Is Your Debt and Your Employment Related

by Bill on January 9, 2012

Is your paycheck related to the amount of debt you owe?

I know there are people who are unable to work certain jobs or certain pay rates because they simply cannot afford it with the debt they have. This happened a lot with the housing bust and the spike in unemployment around 2009. People found themselves required to earn a certain amount per hour to maintain their payments; and working at Big Lots didn’t work.

This is the reason you will continue to hear someone talking about how they cannot take certain jobs; its not because they’re lazy, its because the job doesn’t pay enough for them to survive. So what do you do if this person is you? Here’s an idea or two:

Stop All Non-Essential Payments
Yes, I said stop paying things. No, not the credit cards or the immediate debt. I mean shut off the cable completely. Shut off the Internet. Stop doing anything you can do for free (like use a bike instead of the car). Yes, it will be quiet without the cable and the Internet. Follow along and you’ll see why this won’t really matter.

Improve Your Employability
Take the payments you were making towards Comcast or Dish Network and enroll in an accredited degree-earning course work. In other words, use the non-essential payments towards an investment in YOURSELF. You already improved the value of the credit company or whatever you pay, why not toss money at improving yourself? A two-year AA degree can help you get better employment. I wrote a post about jobs you can get with an AA degree awhile ago that might help with ideas.

Sell Yourself
No, not that way. I mean sit there and brainstorm for any skills or knowledge you currently have. Write it all down. Somewhere in there is a seed for an idea for a part-time income or small hobby-business. Here’s a post on The Daily Money Shot that might help on that end. If there is some way to earn something doing what you love, why would you not try to do it? Again, take the cable and Internet payments, and the money saved from not putting gas in the car, towards supplies to get yourself started. The end goal is to make an investment in yourself that yields a return to help pay down debt.

Use a Debt Paycheck
A debt paycheck is a small little paycheck that goes straight to paying the debt, nothing else. But, what do you do when you don’t know how much paycheck you need?

Take the total debt payment made each month. Divide this by four to find the weekly amount. Divide this number by the Federal minimum wage, not your state wage. As of this post the Fed wage is lower than most states; so working with the national minimum wage ensures greater chances of success. The answer to that last equation is the number of hours you need to work a part-tme job. Use each weeks pay for one month debt payment. In four months you just paid off one year of debt!

There’s a couple of ways your debt and your employment can quietly break up without having a nasty divorce. And you won’t need a lawyer either.

So, is your debt and your employment related?

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Aloysa @ My Broken Coin January 10, 2012 at 4:22 am

It is actually related. In a really bad way: more I make more I spent. I am trying to break this habit. Historically my spending always progressed as my income increased. Sadly. Looking back I can say I would’ve been in a much better place if I’d stopped doing it a long time ago.
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Emilia January 10, 2012 at 9:43 am

We can adapt our lifestyle very easy to a higher income and we feel that we can not live on less than that any more as we adjust our needs to this level. This is human nature. 🙂 Your tips for debt paycheck are increadibly useful. To be honest, we have already cut off our telephone and cable as well in order to save some money per month.
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Bill January 11, 2012 at 1:52 pm

Thanks for the comments Emilia! A debt paycheck is just one way of seeing through the mess many people find themselves in. Sitting down and thinking about all the ways you can make headway, whether they seem farfetched at the moment or not, may bring up ideas someone never considered – like a debt paycheck. The whole concept revolves around understanding that there is an end to it; and there is a way to get there.

Bill January 11, 2012 at 1:57 pm

Hi Aloysa! The cycle you bring up is another part of this I didn’t write into the post – being that the more you make, the more you think you can spend. In the end you have to keep earning more because you keep having to make up for the debt you already have.

As, for looking back on what has happened – I would tell you simply to forget what has happened and concentrate everything on what will happen, and how you can make that part of your life worthy of your memory.

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