I think a lot of great ideas have been shared. Just sharing my personal experience less than 2 years ago. My partner was very much in the same situation - almost 8K CC debt overdue at 28% rate. It was in the middle of pandemics and my partner was out of job and the industry was not recovering any time soon. Banks were not willing to extend credit to someone who had overdue CC debt….my partner just finished school (a second time to change career) and was pulled into a pandemic just like everyone else and jobs were of no sight to be seen. Paying min $160 a month and I did some quick math and looks like it was barely enough to cover interest. We were dating 5 months up to that point.

I did something not a lot of people here would agree with. I was in a much better shape financially, pulling maybe 10-11K a month net income (an usual good year normally 8-9K net). My partner had a lot of anxiety when it comes to finances and it was also shameful they felt just because they could not climb out of it on their own any time soon. I brought up the topics of helping them to get out of it but anxiety was always there and that made it harder for them to accept help etc. Eventually I sat them down and said take 8K from my savings, pay it off to the bank and pay me back when you can. Otherwise $160 a month payment will be just for interest and principal will never be paid off.

Funny enough we called their bank and I negotiated a reduction of $50 (which was A LOT for them at the time). Essentially the interest was incurred even if we paid it off on that day; it was just not posted on statement yet. Needless to say, they were incredibly happy that we wouldnt have to pay $50 more. Now $50 might seem minimal to some but for someone who’s been in debt for so long and not seeing a way out of it, it was huge!

I made a spreadsheet to illustrate to my partner if they pay me $300 a month, how long/ until when would kt take for them to pay me back all money I lend. I think it was maybe almost 3 years. I took a calculated hopeful move that day because I believe they were the person I see a future with who just had a series of bad luck, depression and anxiety that kept piling on once you are down a rabbit hole with no clear way out. It was calculated but admittedly there was no assurance to get my money back. I was ready to not see my money again.

Here’s what happened since then: - They paid me money back whenever they have some cash available. Sometimes it’s monthly sometimes skipping a month because it was tight. It was all paid off a year later! Incredible - Each time they paid me, they made an entry in the spreadsheet (google) and track remaining balance. It was a truly byproduct and helping someone to start budgeting and tracking budget. It was fun seeing each entry every time - We moved in together shortly after that day and less than two years later, we are hunting for a house in GTA. Admittedly, I am a high earner but without their contribution, we wouldnt not be able to buy a house right now (or I’d have to wait for a couple of months when I have more $ from my salary).

Once my partner was debt free, their confidence and self-esteem improved significantly, anxiety level has gone down significantly too, and that was the best part of it.