Fresh meat. From Los Angeles!

iVillage Member
Registered: 01-09-2010
Fresh meat. From Los Angeles!
6
Sat, 01-09-2010 - 6:53pm

Hey everyone, fresh meat here on iVillage, took some courage for me to write all of this down. I'm usually the type to figure things out on my own and not ask for help… (inherited the stubbornness from my father…)

I'm a 25 year old college graduate, working after graduating college for 4 years. I've always worked hard… During & After college… When I say "working hard", I mean being responsible foremost.

I worked down my Student loans to $29k which sounds like a lot but I nearly cut it in half, since my graduation, CC debt $400. Monthly overhead of $1900 (includes bills + current rent). I live at home with the parents, great situation no problems. I pay rent, help out with utilities, groceries & misc house spending. I have about $10k in savings + $3k in stock investments. I have a 401k started at my job. I've always been the smart spender/saver.
I'm at a point where I feel I'm ready to move out but am wondering if it's the right time…considering my debt. While considering my decision I run into the following senarios.

Senario 1
Take large chunks of savings & pay down loan, but this would leave me poorer and chances of moving out and living paycheck to paycheck increase (not what I want)…

Senario 2
Similar as 1 but living with the rents.

Senario 3
Move out, continute to pay my usual 200% on my monthly loan bill…
More detail on my loans,
Loan 1 - 6k @ 4.75% interest
Loan 2 - 23k @ 5.75% interest

I'm not looking for people to tell me "What to do" but actually looking to hear what people have to say from their life experiences to help me make my decision. This question is part debt question part life question.

This is a long read, thanks if you got this far… :)

"Be the change you want to see in the world." - Mahatma Gandhi
"Be the change you want to see in the world." - Mahatma Gandhi
iVillage Member
Registered: 12-10-2009
Sat, 01-09-2010 - 9:50pm
Although I have never made great financial decisions of my own I felt that I wanted to say hi and offer some advice. my DD is just a little younger that you and dying to get out of our house after living on her own in college. I totally understand this but if you get along with your family, please stay with them until you are debt free and also have a nice cushion to fall back on. If you start out now in an apt. or buy something you will have all that debt hanging over you and it makes it that much harder to do the fun things that you should be doing at your age, pay down your debts save money for both long term and short term but most important travel with your friends or do whatever wonderful things you want to do for yourself, maybe a nice piece of jewelry or whatever it is that really speaks to the selfish side of you (we all have that side) Just enjoy being young before you commit to all the expenses that come with living on your own. I tell my DD that we wont be here forever, take advantage of us now because sometime you may have to work at a job you hate or struggle to make the bills and you will wish for this time back. I moved out when I was just 16 and now I wish I would have stayed home till they kicked me out. Be kind to the rents, They will be gone before you know it, they love you and want you to have the happiest life, they may not be able to protect you from everything that will come your way, but enjoy what they can offer, maybe mom cooks, does your laundry, maybe dad fixes your flat tires etc. life is just really hard when you have all the responsibilities. Your Young Your Smart and I know you're in a hurry but please wait there will be time for all that later. love to you


iVillage Member
Registered: 12-04-2006
Sun, 01-10-2010 - 2:18am

I'm currently 26. I moved out of home at 18 (my mother had already passed away and I'd spent the previous 6 months living with extended family; father has never been in the picture).
Ultimately if I'd had the choice I may have stayed at home longer. It is harder to pay down debt when you are living away from home.

Here's my thoughts on each of the situations you've put forward for yourself.
Scenario 1
Take large chunks of savings & pay down loan, but this would leave me poorer and chances of moving out and living paycheck to paycheck increase (not what I want)…
If you were to do this, then I would recommend keeping at least 1-2000 of the savings as a baby emergency fund. If you're not sure that you can do this without the risk of paycheck to paycheck budgeting when you move out, then its not a good idea.

Scenario 2
Similar as 1 but living with the rents.
This would work well from the perspective of not living paycheck to paycheck, and would allow you to rebuild your savings. The main question being, could you handle continuing to live with your parents for long enough that you had the money saved to confortably move out.

Scenario 3
Move out, continute to pay my usual 200% on my monthly loan bill…
More detail on my loans,
Loan 1 - 6k @ 4.75% interest
Loan 2 - 23k @ 5.75% interest
Its great that even in moving out, you want to continue with the increased payments on your loans since it will have you out of debt sooner. However, have you actually sat down and done a rough budget with everything that you would possibly need to cover included to see whether you could actually continue to make payments at this level.

Whatever decision make sure you are comfortable with it - and since you admit being the type that doesn't like asking for help - make sure that any decision that you make won't leave you in that situation. Whether you move out or not, I would opt to use your savings to pay off that $400 you say is currently on CC.

Lyn

bpeblink.gif picture by beautifulmandaPhotobucket


Lyn

iVillage Member
Registered: 10-01-2008
Sun, 01-10-2010 - 7:06pm

I'm not qualified to give you professional advise.

Norma


"Patience is the best remedy for every trouble"- Plautus


iVillage Member
Registered: 03-27-2005
Mon, 01-11-2010 - 11:13am

Personally debt is debt and to be free of it, you have to go at it with all you've got.

iVillage Member
Registered: 12-10-2009
Mon, 01-11-2010 - 6:07pm
My DH and I lived with my dad after we moved back from out of the country for 1 and 1/2 years. Since we didn't have any expenses we were able to save a lot of money fast. We ended up paying for 1/2 of his schooling with cash, 14,000 towards my student loan and taking a backpacking trip through central america for 3 months. So, to make a long story short you could save a lot of money and do more if you are happy living with your family. Also, now we have two little girls and my student loans will be paid off in febuary 6 years after I graduated. So that feels great and now we really need the money to go toward something else.

Liz

student loan paid off 2010

Bathroom remodel loan paid off 2013

Pending Car loan to be paid by the end of 2014!!!!!

 

iVillage Member
Registered: 08-04-2008
Mon, 01-11-2010 - 7:34pm

I lived with my parents after college, had student loans and a car payment, and did pay rent (in the form of my brother's high school tuition - so I had a bill to pay.)


I was then transfered out of state with my company and had to go on my own into an apartment.