Trying to unf***k my finances, need advice

[agent23]

@2corinthians1114 You are fine, try and centralize the debts at the lowest possible rates. Don’t stress over a bit of debt that’s par for the course; focus on increasing your income and I promise the rest will solve itself.

 

[minders0486]

@2corinthians1114 What province are you in?

 

[kremlina]

@2corinthians1114 RSP taxed as ordinary income. Nevertheless cash it payoff loan now.
Payoff any balance & Cancel CC.
Get a no fee CC with low limit — DO NOT use it unless literally life or death situation.
Start saving 10% of your take home by setting up an automatic deposit to a savings account.
Build a realistic budget and stick with it.
Start paying your parents

Part 1 completed. This sets u up to go to Part 2. How to manage $ for your retirement.

 

[mikesekurity]

@2corinthians1114 I agree with using the RRSP. You wont pay capital gains on the RRSP, but it will have a percentage withheld(I believe 10% for that amount) in anticipation of taxes, then it will be included as an extra $3700 in your income taxes this year.

I'd 100% pay of the LOC first, then the remaining two debts would depend on your relationship with your family - make it a conversation. Personally I would pay LOC, then Student Loan, then family just from a math perspective, but if that is going to negatively impact your relationship then maybe tackle the family debt first.

In future, if you can avoid borrowing from family - or even from anyone, it would be ideal. Family especially as it seems great at first, but can ruin relationships in the end.

Good Luck!

 

[celiag]

@2corinthians1114 Imo, you need an extra job if you want to pay this down in a hurry.

 

[tyleryhwh]

@2corinthians1114 It sounds like this debt is really stressing you out. If your RRSP will help you get out of this situation, then I think you should cash it out.

$3700 isn't that bad of a hit and if it relieves your stress then I would definitely cash out. The $180 you're paying now, you will be able to rebuild what you take out in your RRSP in less than 2 years if you allocate it toward your RRSP insteaad.

Also you might want to do a bit of research to see if RRSP is worth it for your income. It tends to favour higher incomes and I think I recall it actually not being worth it for lower incomes.

 

[jongault]

@2corinthians1114 That payday loan is rough. Think of it like this: you're paying $155 a month for the privilege of owing $3800. Your minimum monthly payment is mostly going towards 5paying for interest it's not really making much of a dent in the amount you owe.

Take a look at your RRSP statement, 10% a year is generally regarded as a good return - which would mean your $3700 RRSP might only earn $370 in a year. You can do some math and think about compounding interest over 10-25 years that you might be missing out on, but your debts would be compounding too.

You can rebuild your RRSP after you've got your high interest debts under control. Imagine what your RRSP would look like if you put that $155 a month in there? You'd have it built back in about 2 years.

 

[drmirabilis]

@2corinthians1114 You may have already done this , but confirm that you are allowed to pull your RRSP. I get a 5% match on my RRSP with my job, but I can not pull either my 5% , or the company’s match , without quitting the job. If I were to contribute above the 5% , unmatched , I would be able to take that , but can’t touch any of the first 10% without leaving the job.

 

[clemmy]

@2corinthians1114 I would withdraw your rrsp and pay off money mart loan right away. But this will be treated as your 2024 income and the full amount will be taxable. But this tax won’t be due until when you file your 2024 tax returns next year so you have some time to save up for it.

Next, cancel your credit card and get the $500 back but you’ll need to pay off your credit card balance. At this point, you don’t need a credit card, and definitely not something that charges an annual fee. You should pay cash for everything and maybe get a prepaid credit card that you can top up in case you need a paperless payment method.

You also need to get a second job (maybe third) so you can aggressively pay off your student loans next and save up to pay tax on your rrsp withdrawal by April 30, 2025. Working 2-3 jobs will suck but your debt balance actually isn’t too horrible so you should be able to pay it off relatively quickly depending on how motivated you are. Paying off your parents loan should be last but definitely have an honest discussion with them and let them know how you intend on paying them back (eg $200 a month once your student loans are paid, or something).

 

[psyop]

@2corinthians1114 Buy green sell red

 

[resjudicata]

@2corinthians1114 Ramsey Baby Steps…

 

[jonswater]

@2corinthians1114 I would get a second job for a couple month. You're not that much in the hole!

 

[jonde]

@2corinthians1114 Be proud of yourself for trying to better yourself in such a practical way. You're restoring my faith in humanity in your willingness to learn and do what it takes to try to unfuck yourself. You aren't dumb. You are a go-getter that is learning. Keep going man!!

 

[derikdanton]

@2corinthians1114 LOC to buy crypto is actually gigchad as fuck lmfao