Is it possible to succeed in consolidating credit if you are stuck with part-time jobs? Yes, it is! However, you need to make sure that you know how to manage your finances well. This is how you can continue to pay off your debts while struggling to make ends meet through your limited income.
Your situation is actually more common than you thought. Reports reveal that millions of Americans are stuck working part-time jobs. It is true that the unemployment rate is at its lowest. However, reports fail to emphasize that a lot of Americans only have part-time jobs that do not offer job security. If you are only getting part-time jobs, it can be hard to continue paying off your debts. This is why you need to make sure you have a debt relief plan in place to help you meet all your financial obligations despite your fragile source of income.
Debt consolidation is actually meant to make the debt relief process easier. Instead of juggling multiple credit accounts, you get only one monthly payment. The terms are better than the original ones you had. If you use the right strategy to consolidate debts, you can end up with a lower interest rate and possibly have some fees and charges waived. You also have the chance to ask for a lower monthly payment. This will put a lesser strain on your budget as you wait to get a more stable source of income.
Consolidating credit despite having only part-time jobs
Without a doubt, consolidating credit will be harder if you have a part-time job. According to reports, 8 out of 10 full-time workers are living from paycheck to paycheck. Imagine how hard it is for those who are forced to live on a limited income from part-time jobs?
Although it is difficult, it does not mean this is an impossible situation. You can succeed in achieving debt freedom. It will be slow progress, but with enough discipline and determination, you should be able to reach your goals.
To help you along, here are tips that can help you make consolidating credit a success even with a part-time job income.
Make sure it is the right job
Start by applying to the right part-time jobs. First of all, you want to make sure you are qualified for it. Since there is no job security, you need to work harder to ensure that you will keep the job for as long as possible. If you do well enough, they might opt to keep you as a full-time employee.
Another thing that you should consider is the compensation. Obviously, you cannot expect to earn as much as what a full-time employee would. Not only that, you cannot expect to receive the same benefits. You will just get the income as promised when you were hired. But that does not mean you should not scrutinize the salary. Make sure it is fair and will not put you further back in your finances. The experience should also be worth it. Sometimes, your previous employment experience will help make you a more valuable employee for future companies. You have to ensure that this experience will count – even if it is just a part-time job.
Determine how it will affect your finances
As mentioned, your income will not be as much as what a full-time job can offer. This is all the more reason for you to exert more effort in managing your finances. Make sure that it is clear how much money you are really taking home. If you will not be getting health insurance and other benefits, you have to find a way to pay for it yourself – if you can afford it. And do not forget about your obligations after consolidating credit. It may be easier now and you probably have better terms on your payments. But that does not mean you should be careless. Given your limited financial resources, you cannot miss a payment. The charges and fees will just be an unnecessary addition to what you owe.
Adjust your budget accordingly
Once you have the actual amount that you will be taking home with you, it is time to come up with the best budgeting strategy. A budget plan will help you manage your finances so you can stay in full control over it. Based on your current source of income, the best strategy to use is a frugal budget plan. This means you will only spend on what is necessary – nothing more. If it is not necessary, you will not spend on it. And even the categories that you can spend on should be done cautiously. Be smart with your spending, but be realistic also. Your food budget, for instance, can be lowered significantly. If you cook your meals from scratch, that can help you save a lot of money. For clothes, if you buy from non-branded stores, it might save money as well.
Find another part-time job
Nobody can really live on one part-time job, even more so when you are consolidating credit. This is why you might want to find another job that will help you make ends meet. After all, a part-time job should not take up a lot of time. You should have enough to work on another job. The more income you earn, the easier it will be to meet all your credit and financial obligations. It will also help secure your financial situation. If something happens to your other job, you will still have one more source of income.
Don’t stop looking for a full-time job
Even if your 2 part-time jobs give you enough money to fund your lifestyle, it will not give you security. You still need to keep on looking for a full-time job that will not just give you a monthly income. It will also offer job security. You will be given benefits and other perks for being a part of a company. Maintaining two jobs can be exhausting. So if you can snag a full-time job, it will make your life a lot easier. When you have less stress in your life, it is easier to take care of other things like consolidating credit or setting up new financial goals.
What to do with debts if you only have a part-time job
If a part-time job is not bad enough for your financial situation, your debts will definitely make things worse. This is why you need to make sure that you have a plan to pay it off. Fortunately for you, there are many options to consolidate debt. However, you need to know if your part-time job arrangement is temporary or more permanent.
If it is temporary…
If your part-time job is only a temporary situation, that is okay. It means you are still able to find a full-time job that can help improve your financial situation. One option to deal with debt is to file for financial hardship. This will allow you to pay a lower amount for a certain period of time without being penalized for it.
But if consolidating credit is more appealing, you might want to opt for debt management. It involves a credit counselor who will help create an affordable debt management plan. Once it is presented to the creditors and lenders and approved, you simply have to send one monthly payment to the credit counselor. They will take charge of distributing the payments.
If it is permanent…
In case your part-time job will be a permanent thing, you need a different approach in consolidating credit. Sometimes, people who are forced to retire, either by old age or disability, cannot qualify for a full-time job. If you fall under this category, you should opt for a debt reduction.
This means aiming for debt settlement. This involves negotiating with your creditors to allow you to pay only a portion of your debts. You will make one lump sum payment and anything that is not covered by that amount will be forgiven.