- Jack, a 33-year-old federal government employee, has nearly $ 400,000 in credit card, mortgage and student loan debt.
- He earns about $ 95,000 a year working multiple jobs – not enough to cover his monthly payments of $ 9,000.
- He is preparing his doctorate and hopes to land a better paying job that will help him pay off his debt.
Some people know everyday life a little too well.
This is the case with Jack, whose name Insider has changed for privacy reasons. The 33-year-old, who lives in Texas, is a man of many titles. He’s a full-time federal government employee, adjunct teacher, food delivery guy, and future substitute teacher.
He juggles all these jobs in an attempt to pay off his debt of nearly $ 400,000, but his income is insufficient. Looking towards a better future, he is also preparing his doctorate.
“The reason I’m ‘pushing’ myself so hard is to develop multiple sources of income in the hope that this will be enough to draw attention to higher paying positions,” he told Insider.
It’s a story far too familiar to millennials, many of whom find themselves struggling with student loan and credit card debt after spending years bouncing back into the workforce in the wake of the Great
. Unable to afford his life because of his debt and years of low-paying jobs, Jack pursued a graduate degree, banking on the idea that it would pay off in the long run by giving him a better job. paid.
Math doesn’t stick
Until two years ago, says Jack, he was earning less than minimum wage. Today, his pay stubs show that he earns about $ 80,000 per year in his day job and $ 15,000 per year on top of that, in addition to earning what he can with other side jobs.
None of this is enough to manage her debt, which includes credit cards and a mortgage totaling $ 119,129, according to documents reviewed by Insider. He pays $ 600 per month for his manufactured home and $ 390 per month for the land it sits on. In addition, he has massive student debt, which accounts for the remaining $ 280,000 of his total debt.
That’s a monthly hole of almost $ 9,000. Since his current payments are likely to go towards accrued interest, he estimates that he could start reducing his main debt if he had an additional $ 30,000 a year.
On top of all this, he is still accumulating debt. Because he doesn’t earn enough money to pay off his existing debts and cover his living expenses, he said, he ends up juggling extra $ 1,000 a month charges on credit cards in the United States. almost maximum, accumulating at least $ 12,000 in additional debt per year.
“I barely breathe. I work more than I sleep,” he said, adding that he sleeps an average of four to five hours a night. “This is the country we live in.”
Life student debt charged
When Jack completes his doctorate in education in August, his monthly student loan payments will be estimated at nearly $ 2,500. He hopes his current degree will pay off in the long run, helping him replace his assistant position with one as an evening teacher with better pay. Of course, he will still have to keep his day job.
“I am literally having an emergency or unexpected event of being unable to pay my bills and defaulting on everything,” he said. As a federal employee, Jack fears that a government shutdown could cause him to delay pay, which would force him to default on all his monthly debts.
Jack’s student debt was an unexpected turn in his financial life.
He entered college on an ROTC scholarship, he said, only to have it withdrawn once he changed positions in the infantry. He wiped out his $ 8,000 in pre-college savings to pay for tuition, housing and books before turning to student loans.
He added that he had to repay 1.5 years of his $ 60,000 ROTC scholarship, which forced him “to take out predatory loans and credit cards to survive.”
But Jack is hopeful that as a public service employee he can benefit from the revamped Public Service Loan Forgiveness Program (PSLF). The PSLF is supposed to write off civil servants’ student debt after 120 qualifying monthly payments, Insider’s Ayelet Sheffey reported, but loopholes in the program led it to reject 98% of applicants. The Department of Education announced major reforms to the program this month, including making it easier to qualify for payments.
Under the PSLF, Jack’s student debt would be canceled by 2033 at age 43, after 10 years of income-based repayments, starting next year. But he said he would still be way behind in building a retirement nest egg, with no savings, forcing him to keep scrambling for at least 20 years. If he has children, he may not see a “zero debt” balance until he is 50.
Either way, Jack thinks getting rid of his debts is still a realistic possibility for him. “But until then, I will live incredibly stressed, exhausted and not have the opportunity to enjoy the luxury of life that many of my colleagues enjoy,” he said.