I Am Current on My Bills But Have Really Nothing Left. – Sheilah


“Dear Steve,

We make good money. Have 5 credit cards totalling $73,500. Already have a loan out on my 401K. I’ve got a child going off to college in two years. Creditors are now increasing my interest rate (they say across the board) because my credit rating is less than 719. I am so stressed I won’t what to do. By reading your website, I’d say Bankruptcy and Debt Settlement are out. I am current, but have really nothing left. After the mortgage, vehicles, prescriptions.

What is the best option for me?


Dear Sheilah,

This is a situation of applying the right solution to fix the problem. Not eliminating options off the start. Let’s put everything back on the table, including bankruptcy and debt settlement.

Okay, I’m not a huge fan of modern debt settlement so I’m tossing that one right off the table again just to confuse you.

Your situation sounds like you are current on your bills but just making it. With $73,500 in credit card debt your monthly payment on that must be about $1500 per month. That is a lot.

Your credit score is probably suffering because your balances are slipping up and your debt to income ratio is getting out of whack.

If you want to improve your credit then increase your income and pay off the debt as quickly as possible. Done.

But you won’t be able to save any real money towards college and you’ll have to send your child off to school on student loans. That’s pretty scary these days.

In your current situation it also sounds like there is little to no money leftover each month to put into savings as an emergency fund. And if your balances are still slowly creeping up because you are using the credit cards to make ends meet, now you’ve got some much bigger issues.

See also  Should You Borrow From Your Retirement Account to Make Ends Meet or Pay Debt?

So let me leave this up to you. You could go into a credit counseling program and your monthly payment will be about the same as it is now. Or you could think about bankruptcy, get a lower payment plan in place that you can actually afford or discharge your debt completely. If you were able to discharge the debt completely you’d finally be able to save for an emergency fund and put some money away for college.

If you want to try to pay down your debt on your own, read “Do I Buckle Down and Payoff My Debt or Enter a DMP? – Erica.”


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

22 thoughts on “I Am Current on My Bills But Have Really Nothing Left. – Sheilah”

  1. Looks like I only need 4 “secret” numbers: GE Money Bank (services 10 of my 17 cards), HSBC (1 under Household Bank and 2 under Orchard Bank), CitiFinancial (CITGO and Home Depot), and Chase (BP).


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