Pandemic job loss sank me deep into debt: money advice.

Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)

Dear Pay Dirt,

I had a lucrative job for two years leading up to the pandemic—about $120,000 a year—and got laid off right at the beginning of lockdowns. As everyone froze up hiring, I ended up on unemployment until January of this year, when I found a job in my field, but at a salary of $60,000.

Unemployment provided peanuts compared to what I was making, and all of my emergency savings were eaten up just to pay the bills. I had to put quite a lot of bills on credit cards. I made all the steps to cut back on everything. I even moved out of my apartment into something much lower rent. Having had a job again has been critical, but I don’t see how I can get out of the debt I’m in. I have approximately $40,000 in credit card debt, live in a high-cost area, and am barely scraping by paycheck to paycheck. I am depressed, embarrassed, and unsure of what to do next. I have never been in a situation like this before—I’ve always been good with my finances and living within my means. I am job-hunting again for something closer in pay to what I was making previously, but until then, what would you suggest I do to manage this pit I’m in? Due to my field of work, declaring bankruptcy would be a last resort.

—Pandemic Peasant

Dear Pandemic Peasant,

First of all, be nice to yourself. The pandemic hasn’t been kind to almost anyone, so while it may feel like you are starting over from scratch, I want you to know that you aren’t alone. Many people are reporting being let go at the beginning of the COVID only to see their jobs relisted recently at much lower salaries. You also cut back on your expenses and living costs, which isn’t easy in expensive areas, so give props when due.

As for your credit card debt, I need you to do two things. First, look into a credit card that offers a balance transfer. A balance transfer is a way for you to move the debt from one credit card to a newer one with a lower interest rate, which will enable you to put more money toward your principle (the balance owed) and less money toward fees. One caveat is you usually have to pay the balance transferred off within two years, so only do this if you’re confident you can pay off the amount you transfer.

The other thing I need you to do is look for ways to earn more money. I know you are currently looking for employment that pays closer to what you were making before, which is a major step in the right direction. But I also want you to look into finding a temporary side hustle. Maybe that’s freelance work in your field, a second job, or a passive income stream. I love the website I Like to Dabble—Daniella Flores is a side-hustle queen who shares ideas for various gigs as well as resources for getting started. Even a few hours per week could net you enough to cover a few bills and expenses and help you get out of this pit.

There is light at the end of the tunnel, friend. Don’t give up.

Dear Pay Dirt,

My mother is 68 years old, single, and desperate to retire in two years—but not financially ready to retire and probably never will be. She has no retirement funds, and she has a house that was paid off 30 years ago, but she has taken numerous home equity loans out on it—so she has significant debt. She can’t afford to live in it when she retires. She doesn’t want to sell it. She avoids reality at all costs. She won’t discuss her finances with me, but she does expect my husband and I to help her out when the time comes. She’s horrible with money. I don’t even want my name on the title of her house because I fear what I’ll inherit. Now she’s talking about a reverse mortgage, and she won’t allow us to provide any feedback. She just expects us to step in when the burden overwhelms her. My grandmother always took care of my mom until she died in 2003. Now my mom wants me to take care of her. I’ve been an empty-nester for six years. Do I suddenly have to start caring for my mother?

—Love, Money, and Obligations

Dear Love, Money, and Obligations,

I don’t blame you for not wanting anything put in your name or for being frustrated. Having someone assume you will take care of them when they refuse to discuss their finances in the first place sounds miserable. Not to mention she’s never been fully independent. I have people in my family like that, and I understand the worry that comes with the “what ifs.”

You don’t have to suddenly start caring for your mother, but I do want you to double-check what the laws in your state say with regard to “filial responsibility”—an adult child’s duty to support his or her parents. In some states, you do have to take care of your parents in certain situations, such as nursing home costs, though these laws generally aren’t enforced. I don’t agree with having to bail your parents out, but I want you to review what your state says and perhaps consult with a lawyer to see how you can prepare if needed. I’d also call your state’s economic security office or department on aging to see what resources or suggestions they offer.

As for having those hard conversations, I recommend checking out the book Mom and Dad, We Need to Talk. Author Cameron Huddleston offers advice on everything from how to start those tough conversations to an in-depth list of documents and legal information you may need. If she still refuses, you may need to establish some boundaries around your relationship until she’s willing to talk.

Dear Pay Dirt,

I am at the beginning of a career in the competitive field I studied for. I get paid commission and don’t make a “livable wage” yet. I also have a part-time job on the weekends to earn extra money, though that still doesn’t add up to a livable wage. My partner supports us both, and on his salary plus investments, we’re on track to retire in our late 40s or early 50s. When we first got together, he paid off all my student loans, with the unspoken idea that I would continue on a path to that career.

However, I actually prefer my hourly work, which will never constitute a “career” but would pay double what my “career” does now if I did it full time (not luxurious, but an actual livable wage). We would get our savings boosted earlier (and earn more interest), maybe able to retire slightly sooner, I’d be more satisfied day to day, and feel a little more secure in my ability to support myself if something happens to my partner or our relationship. But if I stick it out in the industry I went to school for, I’ll make more money in the long run. Since he paid for my schooling, I feel obligated to at stay. But on the other hand, every day I don’t make the switch to full-time hourly, I feel I’m losing a little opportunity to add to my savings and a little interest. I feel like I’m literally living the financial version of the Tortoise and the Hare fable. What do I do?

—Money Race

Dear Money Race,

I’m confused. What field is so competitive that you had to go to school for it, make no money, and have to have a second job that also pays little money? You’re also relying on your partner to take care of you, as well as for early retirement, but you’re worried about “a little interest.” Don’t get me wrong, I fully support you working to be financially stable on your own, but the facts here feel muddled.

A career is what you make it. You do not have to stay with an employer that does not pay you a livable wage while you could be happy making money with one that does, despite it not fitting into your mold of what your career should look like. A lot of people have jobs that have nothing to do with their degrees. Many of them are happy and well-paid. Other people work in one field for years, then change to another. This is not the last decision you’ll ever make about your career.

I would take the hourly wage job so you can stop worrying about being able to survive—and can thrive instead. It also sounds like you might be overdue for a conversation with your partner about your financial and professional goals, and what you two expect of each other. If he’s as understanding as he seems—he’s been supporting you, after all!—he will understand that you would like to try something different for the time being. You can always try to revisit the other path later, when you have more of a financial cushion.

Dear Pay Dirt,

I am in my early 30s, married, with no possibility of children, working a six-figure job, and have no debt. I mentor a young woman who recently experienced some degree of familial rejection upon coming out to her family, but she doesn’t appear to have been cut off completely. She knows that if she ever needs anything, she can always come to me. She has never asked for money, but I am her emergency contact when she travels, she checks in with me to confirm everything is safe, etc. I’ve also made very clear to her that if she ever needs a place to stay, she will always have a place with us. I am currently thinking about making her a beneficiary of my life insurance.

Should I do that? If so, what do I need to look out for? Are there other steps that I can take to ensure that if anything ever happens to me, she doesn’t lose her safety net? However, I would also not like her to know that I’m doing this. I think of her like a sister, and I care a great deal and want to make sure she is provided for, but I also don’t want it to be known that I’m doing this, in case it doesn’t come to that (hopefully I will live a very long life and see her firmly established and thriving!).

—Wanting to Help

Dear Wanting to Help,

I think meeting with an estate attorney would be your best option with regards to planning for her well-being and identifying possible problems. (Your state bar association should have a referral service.) Putting her on a life insurance policy isn’t an issue, since you can list anyone as a beneficiary, but you should use this opportunity to make sure you and your spouse are on the same page. Unless a will is drawn up, your spouse is entitled to all your assets. An estate attorney will go over options with you, so you feel comfortable no matter what should happen. Along with a will, you also should consider setting up an advance directive. (Everyone should!) She’s lucky to have you as her chosen family.


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