“I Make $18/Hour and Have $70,000 of Debt” | Financial Reality Check 16:54

What's up guys, George Camel here, and I gotta tell you, I love the feedback you guys are giving us about this channel. Comments like: "George my man, love the channel, keep up the good work" and "Thank you for video and to Mrs. Eleanor Nelson who allow me to monitor my investments and take profits anytime of choice. I recommend Mrs. Expert Eleanor to my coworkers who need such a person in the society. DM her whatsapp I will post below." Okay, comments like that are obviously scammers.

But if it's not, I am missing out on a great investment opportunity. I'm gonna be rich. But we really do appreciate the real feedback and suggestions from those of you who are not bots designed to steal money from elderly people.

And speaking of real, one of the things you've told us you'd like to see on this channel is me helping real people with their real budgets using real life numbers. So that's exactly what we're doing today. And my first victim, I mean guest, is Alicia. Alicia DM me and she wanted help with her budget. So I said, I will happily agree to that if you let me put this in front of thousands of people to watch.

So I gave her a free coaching session and told her it's worth exactly what she paid for it. And the goal with this was to let you see step-by-step how we put together a budget to get her on the path to building wealth. But before we roll that beautiful bean footage, take those little digits and hit that subscribe button, like this video and share it with all your friends who have contacted quite impressive advisor of investment, Mrs. Expert Eleanor for Trusted Invest Broker. Seriously, who's falling for this stuff? Do better scammers, get a real job.

which I know is rich coming from a YouTuber, but still. Anyways, let's meet the star of today's show, Alicia.

Alicia, welcome to the channel. Thank you so much for hanging out with us. Thanks so much for having me. This is great. So tell the viewers what caused you to send me a message a little while back. Yeah, so I have always kind of struggled with my finances, with budgeting and trying to keep everything in check. Then COVID hit and I was trying to get out of my apartment, trying to get out of my lease.

And my sister, who is very gracious and very kind, she offered to have me come live with her here in Arizona. And her kind of one stipulation was like, hey, you got to pay off your student loans. Okay, so give us a financial snapshot. How much debt do you have? What are the types? So I've got about $500 in credit card debt. So I've actually been able to pay that down, which has been good. I think I started...

$1,700. And then I'm looking at about $77,000 for student loan debt between my undergrad and graduate. Oof. What did you study? I have a ministry degree. So my bachelor's is in pastoral ministry. My master's is in ministry leadership. Cool. Are you using that currently? And I work in a country...

No, I work at a country club at the moment. Well, we can help you figure that out later. But today, let's talk about your finances because we got a little bit of a mess here with the student loans. The payments are coming back. Do you know what the payments are going to be? I'm on an income-based payment plan. So they have me like super low at like $32 and change or whatever. But I'm really looking to pay back.

Okay, so what are you doing at the Country Club? I'm an administrative assistant, so I kind of bounce around, but I do a lot of accounts payable. And you have your debt amounts. You started to make an every dollar budget for us, started inputting some of your expenses. So let's walk through this from the top. You have two paychecks a month, and the take-home pay on each is $1,200. So we have $2,400 coming in.

Let's see what's going on. Any giving that's currently happening? Not at the moment. Okay. Anything you're putting towards savings every month? Yeah, I have a very small paycheck that I get from helping teach dance. It's probably like $100. So I'm going to say $100 is...

Heading there every month. Now, what about your bills? You don't have rent. You don't pay for any of the utilities? Correct. Bless you. Your sister is a saint. Can I just give a shout out? I know. Yes. She also was like, please give me a shout out because I'm doing this for you. What's her name? Can we say it? Yeah, her name is Shana. Shana, you're amazing if you're watching this. What a sweet, sweet sister.

Okay, you're paying for some streaming services. What does all entail there? Yep, so that's mostly music. So like Spotify, Apple Music, and then TV, like...

Apple TV. Okay, and that adds up to $35. Your phone is $98. Does that include the cost of the phone, like a payment plan on the phone, or is that just the service? No, that's everything. You don't have life insurance. You're paying auto insurance $90 a month. Mm-hmm. And you've got a gym membership. Groceries. Are you cooking at home a lot? Mm-hmm. Yeah, definitely cooking at home. That's why I don't really have anything in there for, like, restaurants and, like, going out to eat. And then gas? Yes.

You're guesstimating about $150 a month. And then no fun and entertainment for Alicia. No pets, no kids to speak of, no repairs and maintenance. And then we have a counseling. Do you have a monthly appointment there? Yes. Okay. Now let's get to the fun part. Let's add your debt in here because right now your budget's looking so good. You're like, I got $1,450 left. Let's go. Well, not quite. So let's add, how many student loans do you have? I have four. Okay. Student loan number one, give me the smallest one. What is it? Smallest one is $1,500.

153. And what's the minimum payment? Are they all together? Those ones don't technically have a minimum. Okay. And then you know the interest rate on that smallest one? That one is 6.08. So we're going to add the debt. I'm going to say it needs a minimum payment. So I'm going to add a dollar right now. And then we're going to add the second debt. What is student loan number two?

Okay, so that one is the $16,155. Okay, and no minimum payment on that one? So I think it's like $15 or something like that. Okay, and what's the interest rate? $4.625. We're going to add that debt. Okay, student loan number three? $19,843. All right, minimum payment? That one will be zero for right now, or the dollar. All right, and interest rate?

6%. We added that one. Man, I'm getting overwhelmed just keep adding these student loans. I'm like, I'm exhausted. All right, student loan number four. Is 25,963. That's the big one. Minimum payment? That one would be the 15. Okay, getting wild. And then interest rate? 4.625. So let's add in this credit card. You just have one credit card? Yeah. What's the company? Let's give them a shout out. Capital One. Screw you, Capital One.

I can't stand those commercials. I like Jennifer Garner as an actress, but not as a person. And it's because of those commercials. What's the current balance? $511. $511. Okay, what's the minimum payment? $28. A whopping $28. Okay, and interest rate? I feel like I'm going to throw up hearing this. I think I want to say it's like $24. That sounds accurate. Ouch. I think I'm going to be sick.

And where is the rest going? Because you can see in this budget, we should have $1,450 left to budget after all their bills are paid. I think because most of it has been going to my credit card. Okay. Trying to, because the balance was significantly higher. So like every paycheck I've been trying to put

a significant amount toward it to knock it down. And where would you say, you said like, I'm a spender, like this money kind of drifts, where are you spending? Yeah, I think just thinking of like, oh, I need toothpaste and then it snowballs into like, oh, I need this and this and this. And so I think it's just kind of that, that same mentality of like, well, I have the money, so I'll just buy it now and then I'll be good and then I won't have to worry about it for next time. So I've added all of your debts. We have the budget. How are you feeling so far? It's okay looking at it.

broken down instead of just constantly like going back and checking it and thinking, well, if I make this amount of payment, then it'll bring me down to this and then I'll be fine. So I think that this helps me to like visualize a little bit more instead of trying to like

mentally figure it out. Absolutely. This episode is sponsored by BetterHelp. Hey guys, it's George. You knew that. Sometimes this time of year can get a little rough. The sun goes down sooner. You don't know whether to wear long sleeves or short sleeves. And if you don't like pumpkin spice, well, you're just praying for peppermint season to get here. You see, it's rough.

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All right, let's get back to it. Okay, so let's start attacking these debts. And you can see that our every dollar budget line it up smallest to largest balance for us, which is great. And so what we're going to do is make minimum payments on all of these debts except the small one. That's the goal with the debt snowball and baby step two. So we've got to get your $1,000 starter emergency fund. You're so close because between your checking and savings, you have close to $1,000. Next Friday's payday, and you're going to get another $1,200. $1,200.

And so that should fully fund your Baby Step 1 emergency fund. So you're right on track for that. So we can leave this emergency fund savings. Let's say you're going to put in another $300 next paycheck.

to get there. So the following paycheck, you're going to have another one coming in that we can use to start attacking this debt. That credit card is going to be gone with that following paycheck. That's going to feel good. It'll free up that payment to that $28 and you're going to start attacking student loan number one. And the other part of this equation, right now you have an amazing situation because you're living with your sister and even with your income, you still have over $1,000 left in margin, which is incredible. But what if we could up that income to, let's say, $3,000?

Could you do a side hustle where you could make 600 bucks a month? I mean, helping teach dance helps a little bit, like gets that extra, a little bit extra each month. And then I dog sit here and there for people. So that's not like a super steady gig, but I usually get like $40 a day. Well, maybe get serious about it. Maybe you up it to 50 for your new clients, say $50 for an overnight. So let's say through dog sitting,

You're making an extra, if it's three times a week times four weeks, that's an extra $600 right there. Look what this does already for our budget. We're already at $3,100 take-home pay. You know, making $36,000 trying to pay off $77,000 is hard. But making $60,000 trying to pay off $77,000, this is a fixable problem. And so in October, because that's when your next paycheck is, we plan the $511,000, which will cover our Capital One balance. And we still have $1108,000.

And so we're going to throw 1108 at that student loan, which will knock it down close to 14,000. So 30 days from now, that's where you should be. But you can see even in one month's budget, you got Baby Step 1 knocked out, you knocked out a credit card, and you knocked out $1,100 off one of your student loans. It's an every dollar budget because we gave every single dollar a name. Every dollar's got a job, which means none of it can flow away into Amazon purchases anymore.

So how do you feel about this current plan? If you just did this for a few months, do you feel like you'd feel more progress than you have been? Yeah. And again, I think it's breaking that scarcity mentality of like, oh, I'm not going to have any money like at all. And then like not panicking and putting it, putting stuff on my credit card or doing something like that. This sounds crazy. What if...

we cut up the card today. Like, so you could not use it anymore. You couldn't swipe it if you wanted to. Would that scare you? I think a little bit, 'cause I got it in the first place, as people do for emergencies. You're gonna have an emergency fund, next paycheck,

So we're not worried about, you know, most of these emergencies, they weren't over $1,000, were they? They were little ankle biters stuff. So you're going to have the money, just pay for that with your debit card, which I'd encourage you to use. And then you can even cash out

and use an envelope style system for your groceries. So if you're out at the grocery store, we're bringing actual cash and that's going to make you think differently about what we're putting in the cart. I won't make you do it today. We can do a part two where you come back and cut it up, but or send us a video when we're off air and send us that video. We'll clip it in. But I think that's the next step for you. The way we're going right now, we're going to build a future where you don't have to rely on anyone except Alicia and Alicia's money and God. That's it.

Isn't that a better life? That is so much better. That's what I want for you. So we have the numbers here if you actually stick to this budget. What I want you to do for the next 30 days is report back, track your transactions. I'm going to gift you one year of every dollar premium so that it'll connect to your bank. You can just drag the transactions up to the right categories. And before you make the purchase, check with the budget.

Because now you're the boss of the budget. Now the budget is the boss of you. Because that $18.90 that's left to budget, we need to allocate towards this debt. Do you feel like you can do it? I think so. Yeah, this is giving me more confidence than trying to figure it out and make calculations and whatever. That's the goal. Let me nerd out for you and just show you it's possible. Because really, it comes down to a math equation, but you can't just look at numbers. It also has to come from within where you're like,

I'm done with this. Like I, yes, I made money mistakes, but I'm not just going to stay this way for seven years and hope that one day it's forgiven or hope that one day my life changes. You have control of this entire situation, but I believe you are going to overcome this and it's going to be a whole lot faster than you ever thought possible. And you're going to be moving out, have your own place, have your own apartment, probably making double what you're making now with no debt.

and you're investing for the future, and you're saving for the down payment, and you're budgeting for all of the luxuries you want in life, and you have no guilt. Does that sound like a future you want? Yes, most definitely. You ready? I'm ready. All right. I'm ready to go. We're going to check back in, and America is, we're waiting with bated breath to see if Alicia can do this.

Hi. All right. So it's been about a week since I had my conversation with George about my finances. I'm going to cut up my credit card. So I paid off my balance today and it was about $4.90, somewhere in there for my balance. And I'm still waiting for it to like process, process, but it's done. It's in there. And I'm about to close my account, but here it is.

and I'm about to do this. This is so scary, but this is a step for me to being debt free. And so, um, yeah, here we go. Did it. I did it. Oh my gosh. That was intense, but I did it and I'm thrilled about it. I'm happy about it. So yeah, there we go.

All right, I hope this video was helpful. Huge thanks to Alicia for being brave and vulnerable in order to help so many of you out there. Now, if you're ready to create a budget, check out the EveryDollar app. I will link it below and you can get started for free. And while I personally can't coach every single one of you, I made a video called "Budgeting for Beginners" that will help you get started. I'll link that below as well. As always, be sure to like, subscribe, and share this video with your friends who are gullible enough to contact Mrs. Eleanor via WhatsApp. Don't do it.

It's a trap. Thanks for watching. I'll see you next time.