Financial Advice

I’m Feeling Paralyzed in Debt in NYC Without Hope or a Way Out

Question:

Dear Steve,

I have a bank loan I failed at making small regular payments on, it’s at about $1000 and will be written off to collections end of next month. I have a lawsuit from another bank for credit card debt I racked up, so far it’s seemed to be in stasis (no letters in over 4 months from them), but I simply can’t afford to resolve it.

I had the IBR plan on my student loan debt, but I failed to reapply in time because I’ve been depressed and exhausted and just feel paralyzed. My funds are consumed by groceries and rent. The NYC food stamps program denied my application, despite all of the correct materials I provided, and I’m certain it was their mistake…but this took over a month and a half of waiting before I got their rejection letter.

My BFA and MFA degrees in visual and performing arts feel like painful memories, because I don’t see how I’ll ever be able to pursue careers in those fields given my dreadful situation.

What can I possibly do now? I’m 33 and feel totally trapped, paralyzed, and lost. If I move back west to stay with family (parents) it’s not like this situation will be any more manageable, despite the temporary lack of a “rent” problem. Is bankruptcy even an option for me? Please help.

S

Answer:

Dear S,

I can certainly understand how you feel. Looking at the future through lenses blurred with depression, anxiety, and stress will cloud our vision.

The symptoms you describe are often related to depression. After all depression leaves us in a fog, unable to take action, unable to make a plan, or even stick with any plan we might create.

It might just be that what you need right now is a lifeboat to rescue yourself in. Moving back west is not the worst outcome. You could get a support network where you could both emotionally and financially recover. It sounds like NYC is just too expensive for you based on your likely income. But it is also possible that your depression is holding you back from accelerating your career and income. It’s hard to see opportunity when you feel like you are just hanging on by your fingernails.

Now would be the time to get back on the IBR. Reapply. Do it today and set a reminder in your calendar so you don’t miss the anniversary.

If things were not feeling so on the edge for you I would suggest after you apply to get back on the IBR that you go see a doctor to deal with your depression. Getting that under control will give you more possibilities in the future. But getting the depression under control can take time. Time you might not have right now.

So I’m a fan of living to fight another day. That might mean moving back home, dealing with the depression, making sure you are back on the IBR, ignoring the other debt you can’t afford right now, and starting your life over.

But you know, regrouping to fight a stronger battle another day is not a silly approach. Many would love the opportunity to reinvent themselves and start over in a safe place. Maybe that’s worth considering for you?

Steve Rhode
Get Out of Debt GuyTwitter, G+, Facebook

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This article by Steve Rhode first appeared on Get Out of Debt Guy and was distributed by the Personal Finance Syndication Network.

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