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Occupation: Teacher and coach
Location: Plano, TX
Why she needs a makeover:
Erin is a schoolteacher who wants to take charge of her finances--and, as a single mother, she doesn’t want to pass on bad money habits to her daughter. She’s anxious to create a budget, pay down her debt and not be living paycheck-to-paycheck.
What She Said
“I hate being depressed about my finances.”Erin's parents never taught her how to manage money, and she’s considered turning to consumer credit counseling before, but she's wondering if advice from a LearnVest Certified Financial planner could help her instead. Currently she has $11,000 in credit card debt, a car loan for $11,000, medical bills—and $400 in predatory payday loans.
Erin has a good salary, and is ready to learn. “I hate being depressed about my finances,” she says. “I really think it’s keeping me from having meaningful relationships with people. I just hope I’m not beyond help.”
“I really think [my finances are] keeping me from having meaningful relationships with people. I just hope I’m not beyond help.”
- Erin makes $54,000 a year as a teacher, and also has a part-time job.
- Along with child support, that brings her HHI to $61,000.
- She has $11,000 in credit card debt, a car loan for $11,000, medical bills—and $400 in payday loans.
In Five Years ...
“I want to be out of debt.”Erin says: My major challenge has been trying to find money to pay off the payday loan. I’ve made changes in a few areas like my cell phone and cable bills but it’s not enough to help pay off the loan. As for the rest of my debt, Stephany has recommended consumer counseling for me, which makes me feel bad about my own progress.
Stephany says: This makeover was a big challenge, and I think a lot of our readers will relate to the fact that it is not easy to get your finances under control, and that Erin is trying to hard to turn her life around. Turning to credit counseling shouldn’t make anyone feel bad—it’s a resource to help people who have tried everything else, which Erin has. It’s a key step to taking control, and we’re so excited about Erin getting back on her feet!
StephanyPlanning Experience: 9 Years
Best Financial Decision: Setting up retirement savings in my early twenties - time really is money!
Financial Motto: Save big now, spend big later.
- It will take $415 to pay off this payday loan, and it’s crucial—if you’re going to pay it off, you have to find that amount this month to pay it off, even if that means cutting down on groceries or cutting your cable bill! Every $100 payment you make only lowers your debt by $50 and there’s a 611% interest being charged!
- Your debt is still very overwhelming, especially because of that predatory loan, so I highly suggest you seek credit counseling from the NFCC. Make time for this phone call ASAP.
- You worked so hard in this makeover and I want to encourage you to stop and recognize the changes you made! You completely turned around your spending on eating out, cut $100 a month from your grocery budget and $120 from your monthly bills, and have a plan to get freelance income. These are all the right things and even small change counts!