We’re In Debt: $150,679 In Debt, To Be Exact

This article was originally posted by Chris, a contributor at Your Money Relationship, in July. We are reposting it here so that you can learn his family’s story. Chris will be contributing to Frugal Dad on a weekly basis sharing his struggles with debt.

Let me introduce myself. My name is Chris and I am a twenty-something male married to an amazing twenty-something woman. I work in the health care industry and my wife works in education. We currently live in northern New Jersey and have a combined income right around $90,000. Over the past few years, we have racked up an astonishing amount of debt. Granted, most of the debt is in student loans but that is no excuse for our lack of sound financial discipline.

Here is how our debt breaks down:

  • His Car Loan: $7,279.19
  • Her Car Loan: $8,673.10
  • His Student Loan: $66,070.88
  • Her Student Loan: $48,763.88
  • Best Buy Credit Card: $1,468.90 (0% until August 2010)
  • Personal Loan: $1,922.68

GRAND TOTAL: $150,679 (I updated our debt numbers at the end of October and will be doing it again for November soon)

The car loans are at pretty low rates because they are at our credit union. If I had to guess, I would say that our cars are worth a little bit more than we owe on them. The student loans are also at very good rates. About $40,000 of the loans are private loans. Since general interest rates are low right now, they are too. The personal loan is also at our credit union and it is at 12.9%. That is our highest interest rate on our debt.

The loan that bothers us the most is the family loan. A family member offered to pay off our credit cards as long as we agreed to pay them back. It just makes us feel bad that we owe them this money and we cannot wait to pay it off.

So, there you have it. Our debt story is unique but I can imagine that there are people out there in the same type of position we are. We look forward to giving you an inside look into our struggles with debt and how it affects our lives.

From Frugal Dad: I’m looking forward to Chris’ contributions here. We both agreed the timing was perfect since the Frugal family recently completed our journey out of debt, to highlight another family going through the same challenges. I can’t wait to watch those debt balances fall (especially the credit card debt and personal loans) as Chris and his wife dedicate themselves to a frugal lifestyle. It takes a lot of guts to admit that number, even on a blog, and I know readers will appreciate Chris’ candor.


  1. @Lawrence – The problem with the 90k income is that we live in a high cost of living area. For example, our rent is $1300 per month and we do not plan on moving due to our steady jobs. That makes it a little harder to pay the debts off as fast as we would like. We know that the student loans aren’t that much, but looking back we know we could have paid more cash for school. You could almost say that it’s like credit card debt because I would bet about half of my student loans were from me living off-campus.

  2. TO have this much debt would be horrible…I have a fraction of that debt and I find myself struggling. I couldn’t imagine how hard it could be. I have a newer car for the wife of COURSE. I get the clunker but it has lasted forever, it’s a 1996 Jeep GC with almost 300,000 miles and runs GREAT! While I am not in the exact situation, I wish you the best of luck in getting rid of the debt!

  3. :I don’t think it looks to bad at all.” Are you kidding me? This couple is an undisciplined debt train-wreck. And please don’t try to rationalize the ridiculous student loan debt with “it is what it is.” What it is: A financially enslaving strategy for funding an education. And to be in debt to family on top of all of it? Humiliating. This couple should be delivering pizzas nights and weekends to get rid of that loan.

  4. Wow, that level of debt would be shocking, but you’re in your 20s so time is your friend if your frugal about it. I think you and your wife are both in great industries, and have a decent amount of income! Sounds like employment is pretty secure!

    Although I appreciate the honesty around your numbers, it left me wondering about the cars you bought… did you buy new or used ones? – Just curious…

    The cars my wife and I are currently driving were both bought new in 2003. I’ll never do that again!

    I’ll have to go read your site, now I’m curious if you have a set time goal for your debt to go down to zero.

    Good luck, I’m sure you can do it!

  5. this family debt is ridiculous. you should sell both cars and buy beaters. when we got serious with our debt reduction, we sold a beautiful lincoln aviator and bought a very used kia rio. trust me, you will be smiling every month when you don’t have to make the car payments. get real now in your 20s, so when you are in your 30s you can build wealth.

  6. Chris – First, I DON’T think you have a lot of debt since it’s between two people.

    With that kind of debt for student loans, it’s rational to expect a decent income as well.

    The only thing I cringe at is car debt. Sell your cars, drive a beater like a lot of rich people do, and just focus on the student loan portion, which may be tax deductible (the interest) if you make under 100K.



  7. This is one of the most ridiculous statements I have heard in a long time:

    >>As much as we want to get out of debt, I don’t think that the amount of car debt is unreasonable compared to our income.<<

    ANY car debt is unreasonable. Sell the cars, buy a bike, share one car and get a grip.

  8. This should be fairly easy to pay off with the amount of income you have. It could go very quickly. Did you read Amy Dacyzyn’s book, “The Tightwad Gazette”? You could probably use her ideas to get rid of the bills and then start some massive savings.

    Hope it goes well for you!

  9. I can feel your pain. Combined my fiance and I are standing at 155k in debt (with no mortgage). The majority is private student loans too (about 100k). We started at $243,000 though!

    It will be a long journey.

  10. I just want to post some encouragement for Chris. You are doing a great job just in adding up your debt and recognizing that you need to make changes. You and your wife WILL be debt free! Stick together, stay motivated, get a little angry about all that debt. My wife and I are a few years ahead of you. We paid off 35 k in 9 months making around 70 k. You can do it too! Good Luck!

  11. One thing I’ve learned over the years is that people have different tolerance for debt, and the sacrifices it takes to pay it off.

    To some, ANY amount of debt causes such anxiety that they are willing to work 70 hours a week to pay it off sooner.

    To others, their time is just as valuable, and they would rather continue making modest payments while enjoying a higher quality of life.

    My only bit of advice to Chris is to sacrifice as much as possible before kids enter the picture, because it does get more difficult to dig out with more mouths to feed, and more time devoted to parenting.

    I went back to school after our first was born to finish my degree, and we waited to tackle debt until after our second was born. Both tasks were infinitely more difficult on both me and my wife because we wanted to be involved parents.

    Whether or not you guys decide to have kids, making the sacrifices now will help strengthen your marriage and your household going forward.

  12. @ Mr. ToughMoneyLove – You’re right. The family loan is humiliating and it is on the top of our list to get paid off. I know people say to pay off the lowest balance or the higher interest rate first, but we want the family loan gone. It is just something that is hanging over our heads.

    @Don @Sam – My car was bought used and my wife’s was bought new. As much as we want to get out of debt, I don’t think that the amount of car debt is unreasonable compared to our income. Once we get the family loan paid off, I think we can get the car loans paid off in less than 12 months. The risk of buying a beater is just too much for us to handle on top of other things.

    @Mrs White – I hope it goes quickly! Thanks for the book tip, we will have to check it out.

  13. Man, while I was typing up that last comment there were 3 more!

    @Angie – We know it will be a long process and that just makes it even harder. We just paid off one of the debts last month and it helps with the motivation.

    @Mike – Thanks for the encouragement!

    @Frugal Dad – We have been talking about children lately and definitely want to eliminate most of our debt before having them.

    Since our amount of debt is rather large, we want to still enjoy some very modest things such as eating out as a couple once a month. If we didn’t do that, I think our marriage would suffer some because we would just be shacked up in the house all the time. We just need to budget for it and make sure we cut back in other areas.

  14. 1. I consider student loans an investment. You may never be make that kind of income in the healthcare or education field without the degree you earned thanks to that debt. Plus, when you finally pay it off, it’s like getting a pay raise.
    2. Don’t forget there are costs to owning an older car. The time and money lost due to break downs or repairs can sometimes be more than a car payment. There are reasons that manufacture’s warranties only last so long.

  15. Chris, you’ve done one of the hardest parts: bringing all your numbers together and discovering the mountain before you. It’s going to be a long climb, but you could shorten it.
    I’m guessing you want to be out of debt as soon as possible; otherwise, why go to all this bother? At the rate you’re going (paying off about 3% of debt in 4 month), you’re looking at about 11 years before you’re done. Do you want to take that long? Also, why make the ‘emergencies’ point? Emergencies are pervasive, and therefore to use them as a reason to slow down is pretty irrelevant. You’re going to continue to have emergencies: babies (if you start a family), more expensive car repairs ($600 is cheap), medical problems, etc. You say, ‘that is no excuse for our lack of sound financial discipline’, but aren’t you just making excuses? “We had emergencies, our interest rates are low, we had to get a new car…”. I’m sensing a lack of urgency here.
    Ok, I’ve hounded you plenty, but for a purpose. You used the phrase ‘gazelle intense’, which is a favorite of Dave Ramsey. He will show you how to get gazelle intense. If you haven’t heard of him, check him out. Do what he says. Don’t try to ‘do it your own way’ or do it Dave-lite. If you have heard of him, take his advice: it really works! I can testify to that personally. So let me encourage you to get moving.
    You’ve got your emergency fund according to the link above, so no more excuses for emergencies. You have MONEY for emergencies now. You make pretty decent income, even for a higher cost of living area. $1300 a month rent (percent wise) is not horribly out of whack with your income. Could you cut yourselves down to ‘beans and rice, rice and bean’ (a Ramsey concept) and come up with an extra $15-$20K a year to throw at that debt? Could one or both of you pick up an extra part-time job (maybe 8 – 10 hours a week) to earn some extra cash? Could you sell something you don’t really need (a boat, camper, ATV, etc.) Could you cut your cable/satellite TV, XM radio, magazine subscriptions, health club membership? All of these things are available free at a local library (and cable TV is pretty much worthless these days…I’ve been on rabbit ears since 2001 and haven’t missed it!). And the road outside your house is your gym. Finding the price-effective way to replace expensive things in life is how true gazelle intensity works. I promise you, you will find ways. So…no more excuses. Time for results!
    11 years at a lackluster, ho-hum pace you’re presently following vs. 4 years of true gazelle intensity? I know which one I’d choose. Go forth and, in the words of Larry the Cable guy, “git ‘er done.”
    Best wishes!

  16. Shame on you for borrowing from family and then racking up more credit card debt at Best Buy of all places! I’ll bet you really needed that stuff!…..Shame Shame…

  17. @Susan – We actually had the debt at Best Buy before the family loan. We just didn’t combine it with that loan because it was at 0% and we knew we could pay it off before the 0% ended. We actually just paid it off. But, I see your point. My wife definitely didn’t need that new Apple computer. We could have done just as well with something cheaper.

  18. Right now I have $25,000 left to pay on my own debt, down from $90,000 I started with. I am drooling from anticipation of getting rid of it but have a new grand daughter I wish to slightly spoil. To keep focused on the debt, I taped a cardboard chart for 2010 on the bathroom mirror and a 2nd one right next to my computer. This way I see the huge COUNTDOWN letters with monthly pymts to be made as I brush my teeth and then by the computer as I feel the urge to splurge buying presents for family. Very corny but this saves a lot of money by keeping focused. “git ‘er done!”

  19. I have to say I was blown away by the honesty of putting your personal finances out there…. and taking the comments BRAVO ! for what anyone thinks about your debt/situation I am totally impressed by the fact that you put it out here.I certainly don’t have the answer for you but I agreed with other posters that there are a tremendous people who do from Dave Ramsey,David Bloch,Suze Orman etc etc.What I can speak to is what you will find out along this journey- alot about yourself, your spouse,friends,family and even some surprises along the way.Let “it was the worst of times, it was the best of times” wash over you as you embark and BEST OF LUCK!

  20. I look forward to watching you pay down your debt.

    I wanted to address your “i live in a high cost of living area” issue. For awhile we were paying 1300 a month while having a significantly less than 90k. Try 45k. So my view is.. you have *at least* 30k you could put towards debt a year. Do it.

  21. Older cars are not necessarily a risk. My ’94 Corsica with 120,000 miles on it has needed repairs only twice in the last five years. Meanwhile my sister’s new car was in the shop three times the first year for manufacturing defects. True, it didn’t cost her anything as her car was under warranty, but she still had to deal with the stress of taking it in. My beater costs less per year to maintain than any new car’s monthly payment would be. I wish I could get back all the money I wasted over the years to drive new cars. I was always afraid an older car would break down, but I secretly wanted a status symbol too.

  22. Chris – I am definitely looking forward to your posts on your progress. I live in northern Somerset county in NJ and my husband works in healthcare so I have some things in common with you. Luckily, my debt load is not that great though :).

    Just curious, are your student loan debts from undergraduate or did you go to graduate school? Looking back at it now, do you think it was worth it? I was fortunate enough to graduate without any student loan debt but I married into a large amount of student loan debt. While I hate the debt with a passion, it allowed my husband to get a great job and I wouldn’t trade that for anything – especially in this economy.

  23. My 2 cents on the computer? The Apple won’t break down. Forget car repairs-the cost to repair a pc (usually repeatedly,) would add up to the initial cost of the Apple in a hurry. That is one case that buying the best will pay off in the long run.

  24. It is a lot of debt – scary amount of debt but I can see a couple things. First, we don’t know what they do for a living and sometimes a scary amount of student loans is what it takes to get the education needed for long term career goals. While we’d all love to not have any sometimes there is no way around it. Second, in many cases the sell the car and buy a beater approach may be the right one. But in others it’s not. They may owe too much on their car- more than it’s worth, they may have a very long commute and a beater isn’t a safe way to do that (living in southern california with no real long distance public transportation options I can understand that), who knows, they may use their car for work (real estate agent for example and a beater would lose them sales). Definitely an option to look at but you can’t always assume it’s the best option.

    And in my area – $90,000 a year for a couple is definitely not high income – corners are being cut and belts tightened in southern california at an average $45k a year. You’d probably be living in a very tiny apartment living paycheck to paycheck once all the taxes are through and rent is paid.

    Not all places and situations are the same!

  25. It really bugs me when some people come on here and think there is one acceptable way of living. “Share the car”, etc.
    This is one HUGE country, with HUGE cost of living differences. ($1300 sounds cheap to me for example)
    There are some areas where one car would not work for SOME people. Period.
    Be helpful not critical over details which may not match your values and particular situation. Dogmatism has its place, not here IMHO.

  26. The great news here is that most of the debt is a result of the student loans. That means you aren’t living over your heads – a great sign.

    I’m also excited about seeing your progress.

    Congratulations on your honesty and success!

  27. OUCH! What’s your plan of attack? Selling some cars? Selling everything you own of value?

    Are you doing the Dave Ramsey method, or another one?

    I think knocking off your personal loan and your family loan first is a great idea. Then, focus on your other messes.

    Good luck! It’s a long road ahead of you, but it’s worth it.

  28. And I do wonder — is it at all possible to share a car for a little while? Sure, it stinks. But you are super-heavily in debt.

    I’m not saying have one car forever, but maybe one car for a year or so. Just think of the payment, insurance, and upkeep you’d be saving.

    Maybe you or your wife could drop off the other at work, or take public transit, or catch a ride with a coworker.

    Remember, short-term sacrifices for long-term gain.

  29. chris,
    i just went over to the money relationship site and realized that you made progress since july. i don’t want to be the bearer of bad news, but if you continue on this same track of paying off approxiamately $1,100/month, it will take you about another 130 months – that’s 10 years 10 months to conquer this debt. you need to get radical – if you think you had emergencies now that took up your money, just wait until you have kids. i know i said this in an earlier comment, but we sold our lincoln and bought a cheap kia. was i embarrassed to drive it – yes initially – but i was also proud because i knew i was changing my life for the better. once that car payment was gone the other debt flew down quick. if you are worried about old cars, at the very least, you could keep your wife in the newer one and you could drive the beater. then you would at least have one reliable car for long distance trip taking.

  30. Not sure why there are so many toxic posts here. This should be a forum to help others, not to knock people down.

    1) Student Loans
    My student loans enabled my higher income..and were well worth it. Yeah, I only had $25K..but that was 15 years ago, and I had need based scholarships on top of it. The fact is, many young kids are in a tough spot. Their parents make too much to qualify for financial aid, but not enough to help pay for school. It’s just not possible to pay school as you go unless you go to a community college or are in a state where state schools are reasonably priced. (In MA, just tuition is $12K room/board, fees, health insurance, books, etc.)

    2) Cars
    Many dual income couples commute in opposite directions..and live 1/2 way between their two jobs. Sorry, but that’s just not feasible with 1 car. I just bought an $8000 used car, so for me, keeping the $8000 loan makes sense as long as they plan to keep it a long time.

    When you get your first job out of school and you have no money yet, I see no problem getting a car loan to get your butt to work and back. I pay cash for cars now, but it took over 10 years to get to that point. I’m wondering how many of the naysayers are under 30.(And yes, I worked all through college and was extremely frugal. I still didn’t have thousands of dollars kicking around for a car when I was done.)

    Thumbs up to this couple for being proactive before having kids. I personally was chomping at the bit to pay off debt, so it was gone fast. If they really want the debt gone, it will be the #1 priority and they will be acutely aware of every $1 that goes out the door. (I’m not convinced that this is the case as FU posts talked about things they are not changing instead of what’ll ge given up.)

    4) Roommates for cost cutting:
    I had room mates, even after being married and in our first home..it helped enormously and is even more important in high COL areas. We had house parties and potlucks instead of going to bars. We didn’t feel like we sacrificed anything. We liked the people we lived with (friends from work) and had crazy parties that are still being talked about a decade later. Remember, frugal can be very fun.

  31. I agree that there is some negativity here that doesn’t necessarily belong. Chris needs support and does not need to be chastised. Especially about the car thing. While I like Dave Ramsey, I don’t think his methods are for everyone. If Chris had 50K in auto loans then maybe I would suggest selling and getting a beater. And not knowing his commute situation its hard to suggest sharing a car. I travel an hour in one direction and my husband travels 15 minutes in the opposite direction so it would never be feasible to share a car. Maybe if you live in a rural part of the country – but in NJ that just won’t fly.

  32. Chris,

    I’m so looking forward to how you tackle this problem. I, too, live in North Jersey with the same rent as you. No Mortgage, but two kids. I’m interested to see what strategies you take to get down your debt.



  33. Hi Chris
    I saw your original post several months ago and since then I have wondered about you and your progress. I’m glad you’ll have a chance to share with us through Frugal Dad.

  34. I think it’s a great idea bringing Chris on, you can never have too much motivation for being debt-free. (And following along with someone else’s struggles is definitely good support and motivation to keep it up.)

    But WOW, I feel a LOT better about my own student debt right now. I’m right around $28k, not done yet and yeah, that’s for just a bachelor’s. Oh, but I’m not done yet. I said that, right? Just making a point. I’ve felt horrible about it ever since I added up the number, because I feel like I’m the only one with loans that high… I’m glad to see that I’m not alone. (That’s not horrible to say, is it?)

    Especially cheers me up a bit when I’m forced to carry a balance on my husband’s credit card for a month. Yuck. I do not recommend serious car mods after deciding to do it on a whim and trying to get it all done in less than two weeks. It’s a stupid reason to have the balance, but I feel the need to at least keep some cash reserves on hand just in case.

    I know people would want to gut me for the balance thing, probably for the student loans too. On top of that, I used funds that I was going to pay off my car with to buy her the engine and pay for half the swap. Woo, my 21 years got the better of me I guess. But honestly, I don’t see why everyone’s getting so nasty… Wtf?

    Get off the car thing, people. Cars are NOT evil, and they just MIGHT be necessary for them. How about they pay off the loans and don’t worry at all, and have decent vehicles? I’d say just buckle down and zap the loans, then not worry about it… (I’d simply look at fuel efficiency and reliability and make the call there as it is.)

  35. Thank you for sharing your journey with us. It takes a lot of transparency and bravery to be so open. This time last year, my husband and I had more than $100k in debt, including school loans and a basement remodel. Following Dave Ramsey on TV and listening to John Cummuta’s CDs have been lifesavers. We’re lowering that amount significantly this past year and we’ll be able to pay off even more next year. While the journey hasn’t been easy, we’ve learned so much. I also applaud you for doing this before kids. I really look forward to reading about how it’s going.

  36. @ SusanD and your “shame shame” comment…
    The Best Buy debt was due to a much needed computer on my part because of my job. This was purchased by me before we were even married. The family debt that we owe is all from Chris, and we were grateful to get the help. AND was borrowed by Chris before we were married, I did not accru this debt). Now that we are married our debts are combined and and I am doing my part to help pay debts whether I helped make them or not. I just want to make it clear that I would never take a loan from a family member and then go out and gain more debt by purchasing frivolous things. EVER. The computer was a purchase that happened before hand. Also I would like to make note that since we are married ALL of our extra income is going into our “Dave Ramsey” debt snowball and we do not buy “extras” and have not since ever borrowing any money (which by the way was offered to us by a parent that saw us struggling and understood we would pay it back, which we will asap).

    My car was something I purchased a few years before marriage and gaining our combined marital debt, I will not ever trade my car in for a clunker b/c I have seen far to many people end up having to take their car to the shop which leads to much stress and spending. If I could ride a bike to work I would, but a half hr drive- lets see you people do it! I happen to like my car, we are not scraping by, I want a reliable vehicle and I have already paid a lot on it, I would lose out now if I downgraded. And its a Ford Focus! Not top of line here people. I plan to keep it quite a few years after paying it off.

    If Chris and I keep going at the rate we are right now, paying off debt will go smoothly. My only regret was not paying more for my education when I could have, but we live in a society where we borrow with student loans and that is what I did. Now that I am married, I have gained much more debt than what I ever had personally when I was single, but you know what when you are married you work together to be the best team you can be and work it out!

    We do not use our credit cards AT ALL and they are ALL paid off, and our future earning potential is far beyond that of many people. At the rate we are paying our student loans, they will be gone well before the standard 10 years it takes most people, and they are the bulk of our debt.

    Thanks for letting me have a little in put!
    -Chris’s Wife

  37. I’m impressed by your willingness to put your situation out there on the internet. Stick with a plan to rid yourself of the debt and hold each other accountable through the process. If you end up having trouble staying disciplined and on track look at an automated program with a bill pay function included like ours to make it all work.
    Something that can help you stay on track is to not just look at how much you owe right now based on the stamanet balances, but to look at how much you will pay back including the interest payments. That will give you motivation. Good luck.

  38. My name is also Chris. My advice to my children always has been to avoid going into debt whenever possible. Of course none of them followed my advice. Now that the kids have grown up they live well while I am relatively poor. However I am happy and worry-free, while they reamain stressed as they fret about how they’ll pay back their debts.

  39. Pay it off now before you have kids! When we were both working I used all of my income to pay off all our debts aside from the mortgage (we had a similar combined income and our mortgage was similar to your rent). I’m so glad we did because now we live on one income and we have three (soon to be four) kids and I’m amazed at how much money we used to think we were barely getting by on!

  40. Hi! I will be excited to see you pay off your debt.

    I also live in NJ (central). I am a single mom and for 3 years lived in an apartment that also was very high $1200 a month. But I managed raising 2 kids on less than $30,000 a year (including any and all child support recieved) with no debt. I did not have a car payment or student loans. I also worked from home to avoid childcare costs (but that also meant I worked about 60 hours a week.) Of course I credit all this to God.

    My advice is to live very frugally and pay off your debt as quickly as possible so you have no debt if you decide to have children.

    I appreciate your willingness to put yourselves out there. I pray God will provide a way for you to get out of debt.

  41. I had to write again when I saw Chris’s wife’s post….Really liked the detail and can not applaud you two enough for sharing the story and your journey.I worked 2 full time jobs to pay for my daughter’s education-we were in it together and my hubby ran the home front and worked 1 full time job-she worked 20-30 hours while in college full time.My point we did everything we could, shared cars,packed lunches, paid cash and still for grad school(2nd master’s) she has student loans and YES we even now can see how with a little more knowledge we could conserve more hindsight being 20/20.Let’s share here what we did right…what worked and pay it forward.As to Chris and his wife steady as you go and full spead ahead.

  42. Chris & Chris’s wife,

    Each of us have our own tolerances for cutting back on expanses but acknowledging the situation, budgeting and making cuts will mean huge savings in interest in the long run and that is what is important.

    Something to consider when tabulating your accomplishments: As Einstein said, Compound Interest is the most powerful force in the universe. It can work for you and against you.

    By paying these debts down ahead of the amortized schedule then you will save big in interest. I suggest you mark down on the calendar the date of your financial epiphany (i.e. the day you committed yourselves to a financial renaissance). On that day, make note of what each of your debts along with their interest rates. Project into the future when those debts would be paid off and what the total principal interest paid for letting the loan resolved without paying off ahead of time. Make note of each total cost. I bet it will be far more than $150,649! So, the point I’m trying to make is that you will save yourselves a lot of money in interest; never forget to factor that in because the ~$150,000 you are sweating about now could be actually ~$200,000 but when it’s said in done the bigger the number you tackled the wider your grin will be on that day of ‘NO DEBT’.

    Another thing I’d like to mention, a family member gave you money to get out of credit card debt which in these recession days was likely gouging you with high interest rates. It’s a good thing to not have to pay that high interest but I wonder how much that family member is saving you and how much it’s costing them. If the interest on your credit cards was 12% and the family member is giving you a 0% loan then you are saving a lot of money. But here is the rub, why should they (besides family love)? They can earn at least ~1.25% in a savings account or perhaps more risk free. So, in effect they are *risking* their money on helping you out (because I doubt you are FDIC insured) and they are sacrificing any interest gained as well as losing monetary value due to inflation.

    Be a Bank for them! Do them at least the courtesy of giving them saving account interest (or better) so they gain as if it was in a bank. This will make them and yourselves feel more comfortable about the loan. I don’t mean to pile more debt on to your debt but it is the right thing to do and takes the mental pressure off of you as well.

    Good luck!! I’m debt free as of December 10, 2008 and now love to watch my net worth climb with the *somewhat* frugal life I learned to live and continue to live. Compound Interest was working against me but I have tamed that beast and it is now working for me.

  43. You guys have figured it out and stopped the train long before it wrecked, much sooner than many in our debt ridden society do. Keep up the good work and don’t be afraid to sacrifice, sacrifice, sacrifice. When you finally get rid of the last dollar of debt – the joy and freedom you’ll experience will be worth it!!

  44. To Chris and Chris’ Wife,

    Bless you for being so patient with some very intolerable people. Having debt is bad, but you did not commit a crime and shouldn’t have to explain your purchases to anyone. You made mistakes, you are in debt, and now you are working to get out of it. The only thing anyone on here should do is commend you for making that decision and deciding to turn your finances around. Constructive comments are good, but ride a bike to work?? That is just not realistic for everyone.

    My fiancee and I are just starting to combine savings. We have similar incomes and are paying off all outstanding debts (except one school loan) by 1 January and then working to live on one salary and bank the rest. If we can do this, we should have a reasonable down payment for a home in no time.

    My comment would be…don’t forget to save too. Pay off your debts, but make sure you are saving so you don’t get caught by the unexpected – such as a house repair or car repair. First thing every paycheck put a set amount aside in another bank account and don’t touch it.

    Good Luck!

  45. Chris,

    Hi, I’m yet one more Chris! Common name, huh? Like some of the other posters, I applaud you for facing the numbers. I’m looking forward to seeing your progress and watching you play hard ball with those debts.

    Looking through all the comments, I didn’t see anybody suggest applying the Debt Snowball to all those debts. Some people suggested reading Dave Ramsey. If you do that, you’ll read about the Debt Snowball.

    With your debt load, I’m sure you’ll be able to pay your debts off at least 50% faster by Snowballing them. And that, of course, will come with a nice savings in interest as well.


  46. Hi! Move into a studio apartment for 2-3 years to get this paid off. My husband and I& son live on $23,500 a year before taxes.We pay around $500 a month for health insurance. This debt would make me just sick, as we don’t believe in owing people.You can rent a studio apartment here for $329-$400 a month & that’s all utilities included. In your area you ought to be able to find a studio for at least $600 a month , which would give you the rest to put toward debt pay off. I’d start with the family first, as sometimes this can ruin relationships.God bless, Lisa

  47. I completely agree with Lisa, I lived with my husband in a studio for years to keep costs down while studying, and it was hard due to odd hours for studying, but you have a goal to reduce your debt you need to make sacrifices. Also agree that you should most definitely eliminate the debt before having children, not just “reduce most of it”. Think of it that way, if you make it so that you won’t have a baby before you eliminate the debt, it will push you to eliminate it faster. If you think that the trouble of a used car is too much for you now, believe me a child will be so much more. I also agree with another poster who said paid as much in rent and lived with half of your salary. You should be able to put at least 30K towards that debt. Good luck in getting rid of it!

  48. My boyfriend and I have ~100K in student loan debt APIECE and he also has about $40K in credit card debt because you aren’t allowed to work while in law school. Which is a nice way for them to set you up for being chained to a desk for the rest of your life…

    • That’s not true that they don’t let you work in law school. You’re using it as a cop out. I worked for 2 of the 3 years in law school, and kept my debt to $50k. Did I have a 4.0? No, but I did graduate with a good job in May 2009, even in a terrible economy. Ignore your career counselors, they are only coddled by BigLaw.

      • He worked during the first and second summers (the third he was studying for the bar). But his summer internships were in different cities than where he was going to school, so he had to pay double rent during those times and so it wasn’t enough, especially because he couldn’t work during the regular semester.

        It’s done now in any case, he’s been graduated 3 years. $40K in credit cards even after paying off almost $20K, and interest only on the $100K in student loan debt. It’s done now…

  49. Jesus, This is insane.. I come from a family who’s had it hard; My dad is a teacher but can’t work anymore due to health issues and my mom hasn’t been able to work for ~10 years due to her back. I’m 21 and just about a month shy from getting my bachelors degree..I pay everything myself (insurance to tutition to phone bills) and i have about $8000 in savings, from working insanely hard these past few years, next to going to school. (my dumbest purchase was buying two cars at a police auction three weeks ago. Though it only cost me $1500, i now have two cars for which i’m paying insurance and tax, and i need to get rid of them. fast. I -hope- i can make some money out of the deal, so much for my entry into car dealing 😉 ) I should note that I live in Europe (dutch), so universities don’t charge exorbitant amounts of money, though everything else is more expensive in Europe. Daily, I am worried that i’m not saving enough and on the road to financial bankruptcy. My question is: Why lend so much when it should also be possible to work first and buy later? I honestly don’t mean to be holier-than-thou but shouldn’t it have been possible to do everything you did -save paying tuition – without aquiring such a debt?