Find a job, maximize your income, build an emergency fund, minimize expenses, stop using credit, and address your overspending.

What I would add to this advice is that this is a marathon not a sprint. You are not going to be able to cut every big expense and live like a pauper for the time it is going to take. There will be weddings to attend, vacations, cars break down, layoffs, marriages or babies.

So just mentally prepare yourself for that, but by no means throw in the towel. Keep going!

I hope that high school seniors and college students look at this and understand that taking out enormous loans now can have a huge and limiting impact on your future.

Also, it’s very important to live simply as you mentioned. Those in debt need to be more financially aware than those who are not. This is somewhat contrary to the natural order – our protagonist likely became saddled with debt by living a bit beyond his means. When you are saving very little to nothing at all, getting discounts, trimming expenses, and living frugally can make a big, big difference – http://wrinklydollar.com/2009/.....n-savings/ .

He is teetering on the brink of financial collapse, but that said he still might be able to get through it. I agree that the amount he owes is too large for him to work at without debt consultation or bargaining down the amount.

Hopefully he can also sell some of the stuff he bought using that money.

As far as credit card debt, I don’t have much. My biggest payment is my car. I have a part time job…I am going to FORCE myself to apply all of the funds from that job to my CC debt. I will be checking your blog for more tips!

They do however offer deferment and if it helps you get a great job out of it, it may be beneficial in that regard.

“The good news (if you’d call it that) is that he’s collecting worker’s compensation, and is hoping for a sizable judgment in a resulting personal injury lawsuit.”

In MOST states, if you are collecting worker’s comp., you are unlikely to be able to obtain a personal injury award from the same occurence.

That being said, his state may be different, GET YOUR BUTT TO AN ATTORNEY TODAY…you may be playing with fire (if you aren’t already burned) with the Statute of Limitations.

This person sounds like they have serious spending problems ($56K for the school, but $265K in loans and $23K in credit cards). They sound like the need debt counseling. They spent roughly $58K per year (assuming 4 years in school) on top of the tuition. I didn’t even make that kind of money for years after college.

I know someone who has $30,000 in credit card debt and a collection of 300-400 DVDs. Needless to say that a lot of that credit card debt went into buying those DVDs, and fortunately enough they are something that can be sold to get back some of that money.

Paul

I’m curious to see this guy’s response to your advice.