I've made a lot of stupid decisions in my life and have been living beyond my means for a long time. Now I'm paying the price. I live paycheck to paycheck and have no savings. Nothing to my name. I have a cheap car that is paid off, that is all. My girlfriend left me months ago so I no longer get any financial support from her, though all of this debt was accumulated (in my name) while we lived together. I am currently living in a friend's living room, but will have to move out by month's end. This means I will have even more expenses in the near future with rent and utilities to pay.
Half of this debt is on credit cards and the other half is a line of credit from a bank that I used to consolidate other credit card debt. I can only afford to make the minimum payments and have been told by a financial adviser that at this rate I would not be able to pay off this debt in my lifetime.
Here's a breakdown:
Credit Cards (minimum payment): $700/mo
Line of Credit (minimum payment): $600/mo
Gas: $200/mo
Car Insurance: $200/mo (I have a horrible driving record, too)
Groceries: $300/mo
Rent (projected): $1000/mo
Electric (projected): $75/mo
Cell phone: $50/mo
Total expenses: $3125/mo
Income (after taxes): $3400/mo
Remaining: $175/mo (Though not likely - I'm probably forgetting some expenses)
It appears that I could continue to make my payments, but I can't help but think that bankruptcy is the best option. I want a clean slate. I don't care if my credit is ruined for 7 years, it seems like a small price to pay given how hopeless I feel right now. Unfortunately my income is too high to pass the means test so I would be stuck with Chapter 13, which would do me no good. A few months out of work would bring my six-month average income down enough to pass the means test and qualify for a Chapter 7 (I think). I'm considering quitting my job (which I'm not happy with, anyway) and moving in with my parents. I could find another job and start saving money instead of being stuck in this hole. Is this a viable option? Or am I better off slaving away for who knows how long just to pay the bills and not have the stigma of filing for bankruptcy?
