She Keeps Choosing Debt Over Work

0:00Hi, my name's Jess. I'm from Montana and this is Financial Audit. and how old are you 27 27 awesome well thanks for coming down from montana what do you do up there for a living i am a nanny right now so i've been in oh child care a long time okay so how long have you been doing that since like before graduation high school or yeah like right after i graduated what made you want to go into that um well i just i don't know i've always kind of I liked kids. I took care of my siblings growing up and just kind of fell into it and got training and went from there. Has it been a successful career so far?

0:39No, it's not very good pay. Oh, well, what are you making? What do you think on a monthly basis on average? So right now, I just recently started this nanny job like a couple months ago, and it's 16 an hour.

0:54I feel like my friend My friend who just watched some kids Who's 19 makes more than that Why is it so low? I don't know Is this for a company? No, it's just privately Really? Okay, so Wow, so it's just the area and everything like that? Yeah, I think Pay wage is a little lower in Montana Sure, just across the board But yeah, it's, I don't know. This job is actually more than I've made in the past, like working at child care centers. Well, hopefully with that, the cost of living is also lower. I'm hoping we're going to collect some information and figure that out. Oh, okay. So, okay. Well, did you say 16, 15 hour?

1:38How many hours are you working on? 16 an hour and it's averaging like 35 an hour or 35 hours a week. Yeah. And you're doing like every week you take weeks off or like what does it look like? Yeah, every week. and then this I'm not, so this I just started and then I also wasn't sure about like taxes like that so Well, there is gonna you're gonna have to pay a little bit of taxes and then just being self-employed and everything, there's extra taxes that come with that but with the bracket you'll be in and you know hopefully, I don't know how much you'll be able to write off maybe transportation to and from potentially

2:17but just the tax bracket you're in, I don't think you're gonna be too much but it is always good to at least think about putting 25 to 30 percent aside usually 30 percent is the recommended just for safety are you not as of yet because i was have you paid taxes these last like 10 years yes yeah i've always had like pay stubs and did taxes that way so and you've claimed everything correctly and everything oh you had oh okay interesting so how are you being paid right now and no right but you're keeping track of all that correct Yes, yeah, it's all logged on there like every week and then you get like the quarterly statements So we are what yeah more than halfway through the year and you haven't saved up anything for taxes on the side No, I just started last month at this job Oh, so what were you doing previous then?

3:06I worked at a daycare and it's kind of complicated um this year has kind of been weird so i worked at this daycare after taking like a year off with kids i was doing like decent before that and yeah no i mean just like what's up why'd you leave the daycare what was happening it was just the pay sucked and um she's gonna give me bonuses that didn't really happen and i ended up with this like debt like i borrowed again from that thing and we're about to go into a lot of that yep a lot of that before we go into that debt though you should hit subscribe because we are trying to get 750 000 subscribers and thank you to everyone who has subscribed so far so this debt so were you just not making the money you needed to do and you just ended up going to debt because you went into like a lot of different kind of debts that have stacked up quite dramatically for your income.

4:04In fact, for your income, this is if you work 35 hours a week, every single week, never taking a break, essentially, with that job. It gets you that it's still just below$30 ,000, which is$2 ,426 a month, and then you have to put like 30 % aside for taxes. So even with that, like especially post-tax and everything, your debt is over that at that point in terms of how much is owed, and the interest rates are insane. So tell us about your financial situation. Why are you where you are right now? And what's up? So I've lived with my grandparents for a while, like probably six years almost now. And I have never like they don't I don't pay rent.

4:45So I've kind of went into child care and I kind of. I don't know. It's kind of hard to explain. Like my growing up, I didn't have very much stability. So when I was like moved in with my grandparents and had that stability, I kind of just was thought I was OK because I was paying the bills, making bills. And I didn't really have debt and like besides a car payment until probably the last couple of years. Well, what's been happening the last couple of years then? Well, I took out that upgrade thing and yeah, I did. And then I wanted to just kind of take some time off because I do work a lot, like up to two or three jobs sometimes.

5:35Okay, well, right now it's only 35 hours a week. So I don't know if I'd consider that a lot, but sometimes. Not right now. Okay. Yeah. But yeah, and it would be, I would like make bigger purchases and then not really save. Any reason why? I just probably ignorance. Yeah. I just didn't think of the future at the time in my early 20s and dumb. Okay. So what would you give yourself a score? Zero out of ten. 0.5. 0.5. Okay. Well, I at least appreciate that honesty. Honestly, we're about to go into this debt, and that kind of aligns with potentially what I've seen. So why'd you go into this upgrade card loan of death, insanity, chaos?

6:22Terrible. Yeah. Well, I was just burnt a couple summers ago. I was burnt out and just wanted to take a couple months off. Burnt out from what? Working. What were you doing? I was doing child care, and I did photography on the side as well. And I also had times where I worked at a restaurant in town, local restaurant. How many hours a week would you say you were working at that time? I'm just trying to, how are you burnt out? Probably like 80. Is there something going on down there? Oh, I'm playing with my phone. Oh, okay. Yeah. So I just want to make sure it's not being picked up on microphone.

7:03Okay. Then you got burnt out and then you just took out debt to live instead? Um, yeah. Cause yeah, that's kind of where it ended up piling up. I was working. I had a school district job as a paraprofessional. Dude, you've been, you've done like more jobs. like most people do in a lifetime within the last half decade. Yeah, I worked at a child care center consistently for like over four years and was doing different side stuff while I worked there. And then I got this paraprofessional job and was doing okay with that. And that's when I took this loan out because I knew I was going back to work.

7:41When did you take this loan out? Originally, like probably two summers ago. If you took this loan out two summers ago, I'm so curious. I did. Because I did pay it off at one point. You paid this off? Yeah. And then knowing it has a 30 % death interest rate, why did you possibly get it all the way up to the max? Because you owe$4 ,387.10 on here, but there's only available credit of$160. Why are we where we are now? Because I kept borrowing against it. No, no, no. I know. But if you paid it off and you made that progress, why did you put it back on? I need to know where your mindset's at going into this.

8:22Yeah, I know. It's not good. But there wasn't probably any logic behind it, honestly. Are you still spending money on this? No. No. Okay. 30 % death. Yeah. Interest rate. This is crazy. Okay. Well, say it with me. You're not a credit card person. Nope. We know that immediately because you maxed this out again. We're about to go through like a million other debts. Of which, by the way, you are not just not still spending money on those debts and cards. I'm glad you're not in here. You really can't. There's only$160. Right. You know, I don't know. I'm immediately nervous of like what to do just because, okay, let's pay it off.

9:05But then you have something that was paid off. Yeah. Then are we just going to do another$4 ,500 on something with 30 % interest? again or we're just going to do that again not this time what's going to be different about this time well the plan is to pay off the super high interest stuff and then close those accounts or well what's going to be different about you this time plans are great yeah what's different well now i'm aware of how terrible it is because i thought i was doing okay because i was making the payments and then when I left the daycare like at the end of winter it was I um sorry I lost my train of thought but when I left the daycare at the end of winter is when kind of I took it out again because of last winter yes like you stacked that up within just a few months what on what what was paid what'd you spend it on like both yeah like oh geez and then i will after i left the daycare i didn't have a plan so i kind of lived on that for a couple months like this may was when i kind of got back into work like stably okay there's i'm there's like red Red flags everywhere.

10:34This is like a red flag central right now. Paying off cards, putting it back up, taking off work, working like a thousand trillion different jobs within just the last few years. Like, how do I know you're going to be in this nanny job two months from now at this rate? Like, what if you feel burned out? Then all of a sudden we just like, we open another card and just, this is not, by the way, shaming you in this situation by any means. I'm just, I'm scared personally. and I need to know where you're at and like what we can do here. Which, by the way, I should say thank you for being on here. Though this is certainly a dramatic conversation and probably very tough for you and I get that, there's probably thousands, tens of thousands of people that relate to your situation out there and you're coming on here putting your situation on display and it's hopefully helping them and that's always the goal.

11:23So thank you for doing that and give her love in the comments because that's great. Oh, yeah. Yeah, the timeline is super confusing. It is. But yeah, I didn't really realize how absolutely terrible it was since I left the daycare job and saw it all added together. But I need to know what's going to be different this time. What's actually going to be different about you this time? What's going to say you're not going to leave this and go get your 30th different job next month?

11:55Because I'm going back to school. I just think it'll be different. You're going back to school now. Okay. While I do this job. we're throwing something else in. Yeah. Okay. What's your highest level of education? I did about a year of college. And then when I got training at the center, I was at, I community college. Yep. Do you have those credits though? Yep. Okay. It's all transferring. It's the same place. Good, good, good, good, good. What do you want to do? Um, I don't know. All right. Well, that's it. Okay. We'll, we'll go to that conversation. I don't know if I want you spending money on college if you don't know what you want to do yet.

12:34College is great. I know. It was just, well, when I left the daycare job, I like had a really hard time finding like other work. Sure. Is it a small town, small community? What's like the population? You don't have to tell us the town, but like what's the population? Um, I don't know. It's one of the bigger towns. Like that is a very small population. 33 ,000 people. Okay. So yes, I can see opportunities being limited. for sure yeah and it was because i thought i was good with the training i got through my old job and then it was kind of child care positions kind of cap out at a certain pay like 20 i'm sure i'm sure when there's when there's this less market availability for that yeah and now that i've like 10 years of experience it was kind of like i don't want to do the same job forever so So if I get my associates, maybe I can just get a better job from there.

13:30We'll talk about that. That's an important conversation. We'll talk about that. We've got to get through the debts and see what your financial situation looks like. So we know we have the$4 ,226 at the death, death, 30 % interest rate at$193 a month minimum monthly payments. These minimum monthly payments are about to stack up, by the way. Now, we had a card. You had$1 ,000 on it. That's not great. But then you made$150,$100 a payment or$180 a payment. That's great. But then we did$400 of purchases. $400 of purchases. Why possibly on a card that we are losing interest rate on, which is$14.16 on a monthly basis, which also 30 % interest rate, if I'm not mistaken, which also yearly interest loss,$132.

14:16Why are you possibly spending$400 on a monthly? The most recent month. That was the plane ticket. Okay. Because I had the airline credit and it was going to cost me$100 out of pocket. And by the time all the emailing was done, it went up to$325. Well, the good news is we do reimburse some of it. Oh, what? I'll talk to you about that afterwards. But, okay, hopefully, even if there was no reimbursement, I'm hoping the$401 is considered an investment, that this will help a situation that will more than have a return on investment of that$400. in terms of potentially tens of thousands, hundreds of thousands of dollars in terms of you getting out of debt, starting to invest, and being able to retire at some point.

15:01So hopefully that has a good investment on it. So, okay, it's the Cook Silver with$1 ,285.84 with a$45 minimum monthly payment and of course 30 % death extreme interest rate of 2914 interest recruiters in the last month. Crazy. And no, it wasn't just a plane ticket. Come on. Spending almost 40 bucks at Hobby Lobby and spending over 40 bucks at DoorDash. Do we need to be DoorDashing? Do we need to be DoorDashing while we have the stupid 30 % debt and another stupid 30 % debt and more debt that we haven't even talked about? Should we be DoorDashing? No. Why did you DoorDash? because it was just last month and you said, oh, but I learned the piece of personal finance, which is great.

15:56To myself, it's better than I was doing. But yeah, I know. Not a good habit. Not a good habit. We don't do it. We don't do it for a single second. DoorDash doesn't exist. Honestly, should it really exist afterwards anyway? I don't know. It's a very expensive way to get food. It's only if you can be very easily afforded within the budget does it ever make sense. And then, of course, we have another card. It was$662. made$180 payment. Great. That's over the minimum monthly. That's awesome. And then again, purchases, it's only 18 bucks, but still, why are we putting money on a card that you are losing $14.85 of interest on, on a monthly basis?

16:31And you have lost at 32 % interest rate,$45.71 this year so far in interest. Why possibly would you be putting 18 bucks on this card? No good reason It's just Obviously I'm not a credit card person You're not a credit card person Not a budget person currently It's I'm okay It's It's okay to keep Bust with the boys is here to let you know that every college football Saturday Fan duels dropping profit boosts That can turn wins into bigger wins Sounds like we should rename Saturday Booster Day Nice 21 plus and present in select states Opt-in required Bonus issue does not a withdrawal profit boost tokens Restrictions apply Including any token expiration and max wager amount See full terms at fanduel.com slash sportsbook Gambling problem?

17:25Call 1-800-GAMBLER I have an excuse as of why you put this on here Because that at least gives us insight into why Into the I don't knows or it's just bad Or I was just being bad Like please tell me What's your justification behind it? Where were you mentally when you went in DoorDash and Hobby Lobby and then what you do on here? Gas. Oh, gas. But then why did you put it on this card? I need to know where your head's at. We have to get to the bottom of certain things so that we can put you in a better place going forward. Well, yeah. I always make payments on time, so I just kind of justify it to myself that way.

18:06That's not true and we'll go into that. Yeah. sorry continue yeah i just kind of justify it well i'll pay it back later and then it adds up and i owe a lot okay that's just okay good well thank you no that's very helpful that's good so you think just because or it's able to be paid back later and because in general you know making them into monthly payments you're chilling okay now we have another card this one is last I believe I paid off. Yeah, because there was like$7.31, but there were fees of$8.32. Yeah, and it was after I paid it off. I saw that when I... Was it like a transfer fee or what was it?

18:54Maybe it was annual. Oh, this is... Oh, credit one. Oh, if there is a credit card or bank or whatever that I have learned to hate throughout the process of this show, it is credit one. credit one of death because they just they're just punching poor people in the face on a daily basis it's not fair it's not people sign up for it but it's just the predatory practices that they go after I like credit cards this company and the way they go after people with their terrible terrible fees just so people feel like they have a place they can spend money it's disgusting it's terrible so So, yeah, cut that up.

19:40Do you have it with you? Yeah. Are you willing to cut it up? Yeah. Good. So this is credit one. Oh, there's really nothing to pay off. Again,$7.31. So just pay that. Because it was$58.62 of fees charged within 2023. You have a monthly fee. It's probably that like$7.31. It's a monthly fee. It's done. I need you to close this one. Usually I'm not a closed account kind of person, but you're just losing money on this. You're going to close this account. And then interest, because, again, you did hold balances on it of$8.13 this year and a 29 % interest rate, but there's nothing there to pay off. But we do have a car, I'm assuming, is what this loan is.

20:23Yes. This is at a better interest rate of essentially 6%. Yes. When you take an account of depreciation and everything like that, I still don't like that. I wouldn't want anything on vehicles that are over 3%. so it's still not good we'd still want to pay it off early what's extra bad on this is the 70 you took out of course 74 months so you're just like well what's the longest we can do it in order to get the minimum monthly payments down and you took out like the longest car loan and then you're like okay cool happy days and then with that I mean you're paying a total of 17 ,213 on the money you borrowed of 14 ,526 because of the interest Right.

21:05So even though the interest rate feels lower compared to like the crazy 15, 25 % that we've seen in terms of cars, it's still terrible. Yeah. But that one, I paid$250 a month, so it's like$11 over the minimum. That one I thought I was doing okay. Right. Yep. Okie dokie.

21:31Well, so I don't know this bank. The finance charge, the way they have it lifted out.

21:40I wonder what the early repayment is. I wonder if that's like, okay, total payments after you've made all payments. Okay, it would be the$17 ,000. But the amount you financed was at$14 ,562. So we're definitely going to try to pay that early so you don't have to pay that close to$3 ,000 in interest. Okay, so$14 ,562. And all your money is going to interest right now. except for that little bit that you're making extra, at a$239.09 minimum monthly payment at 5.74 % interest. So essentially 6 % interest. Okay. Now in terms of you're like, okay, I feel okay. You've overdrafted this year so far and you're checking it out.

22:25You've overdrafted. I did the last couple months, yeah. Yeah. So if we're overdrafting, do you really feel that mindset that you just said of like, oh, but I can just pay everything? Yeah. No, I know. It's because I wasn't, I was having such a hard time finding a job after I left. Why'd you quit before finding another job? Especially in your situation with zero dollars in savings, correct? Right. Yeah. Yeah, it's just because I was basically losing money with that job and was not making money at all. And then I had to like personal things happen right after I took that job with her and had to miss a week and go down to Salt Lake because my aunt died.

23:11And then. Oh, I'm sorry. Yeah. And and then after that, I just could not catch back up. and she kind of promised me bonuses that didn't happen. And I just... I am not for sticking around a job, especially when money's promised that was not given. But at the same time, what's going to put us further in the hole? Yeah. Looking for a job where we at least have some kind of income versus just no income whatsoever. I know. Yeah, and it wasn't the best choice, but my mental health improved a lot afterwards. So I kind of. Well, how's your mental health with all this debt? Not good. It's, I hate it, but that's the only thing that's stressing me out.

23:57Fortunately, right now, but. Okay. So on here, I mean, you have$516 in there. It's a little low for a checking account. I'd like to at least see a thousand bucks just for safety reasons. And again, I'm terrified of that$0 in savings. Do you even have a savings account? no i i got so fi but good and that's great link in the description below because there are sign up bonuses and a really good high yield rate but you got it just nothing to put in there well i got it and i was trying to put more money in it but it won't let me deposit i have to like link my bank through it i just recently downloaded and put it in so okay you know it's pretty chill to do i mean it's usually what you do with most high yield savings is you'll link your bank account too okay yeah yeah it was like the last week i put got it what were you gonna put in there because you only have 560 bucks though and you're checking account we wouldn't want less than that in a checking account do you have money somewhere i don't know about i just put 50 bucks in there um no that's okay okay yeah we what is this rocky mountain that's my car oh yeah okay that makes sense then we have prime video we're making like a rent or something like that right of 10 blocks subscription then so i see you go to some gas stations but then you also go to the gas station and get like three four dollar purchases which i assume it's not just gas right no yeah we're getting some taquitos and stuff you don't need to be doing taquitos right now in chef's store which chef's store um it's like a bulk food place okay that's fine that's a good way that's a good way to save money oftentimes is the bulk foods and then we're drawing money of 60 bucks who knows or where the heck that went.

25:39Okay, there's the gas. That's fine. Then the DDA would draw $240. And then we're getting some taquitos. And then we're going to some chicken. Longhorn Saloon. $4 taquitos. And Cole Avenue something there. Oh, that's my storage unit. What? A storage unit? No. Oh, sorry. It's an expensive storage unit. Yeah. It's actually my boyfriend. We have it. We split it in half, so I get paid 40. Why do you need a storage unit? What do you have at 27 that you need to store? I'm a beekeeper, so I have bee stuff. Yeah. Do you make money off the beekeep? Not yet. Nope. Okay. That's an expense. You need to put a lot of money in to make money, yeah.

26:33Wow. lovely audible that's okay I like audible but just in your situation we just want to save as much money as possible and yes and then Adobe and I canceled that like Photoshop and Lightroom good and then McAfee that was an annual fee yeah yeah and then they reimbursed me like 60 because I called about it I wasn't expecting it but yeah Adobe which you've canceled but then Wendy's. You can't cancel that. That happens. So Miller Crossing, I don't know what that was. BJ's Wholesale Club makes holiday hosting so easy we called in the ultimate host to talk about it. Mrs. Claus here. You think Santa has it tough delivering all over the world?

27:19Try cooking for hundreds of elves. Good thing BJ's offers low prices on all the menu must-haves plus free same-day delivery on your first order of$100 or more. No more squeezing in trips to the store. The only squeezing here is the big guy into a suit after dinner. For terms, visit BJ's.com slash holiday and get the same great prices online as in club. This is a bar. Yeah. Great. And taquitos and Lewis and Clark and Amazon and PlayStation. 50 bucks there. And I think that one's gas. It's kind of hard to tell in here. And then, oh, the care.com. What's care.com? That's what I, that was also annual fee.

28:01My, that's where I got my nanny job through. So. that also got canceled for next year. Friendly's, which is probably a bar. It's a gas station? Yep. Friendly's? 14 bucks? You just got$14 of gas? No, that was probably... Taquitos, and then there's more taquitos, and then withdrawing something prospect, 60 bucks, and Spotify, more Adobe. Glad you canceled that, and then more PlayStation. and yes $30 of overdraft fees right so what you said earlier is not 100 % true about always being able to pay things because congratulations we're having overdraft fees which is terrible if we're having overdraft fees then no we cannot be going and putting money on something that we're just paying back later if we can't even have money in our checking account correct?

28:51correct you agree? okay perfect let us figure out where some of this sits so we have$0 in savings correct? Yep. Okay, so we're going to really start from the absolute bottom. Negative. Bottom, like there's really not. You have$20 ,000 of debt. Total minimum monthly payments of$509.96. I mean, that's already minimum monthly payments on the debts, of which none are actually like good debts by any means. At least the car has something physical, but everything else is just nothing. All the debts, middle monthly payments are a third A third of your income After what you set aside for taxes A third of your income What's your rent?

29:41None With my grandparents Oh, with the grandparents, that's great That should help us in this situation dramatically Thank goodness How about you Okay, so gas, I'm seeing How much do you think you spend on gas on a monthly basis? Maybe $250 or so Okay. Do you put anything towards the grandparents' situation, like internet or utilities or anything like that, or do they just fully take care of it? Yeah, they take care of it. Okay, cool. I'm just going to lean this towards where you were. Okay. Now, going out to eat and just spending money on bulls, essentially, you know, we're seeing like$200 to$300.