So, time for a major reality check. School vs Work.

Most folks will tell you education is important….however, most of them are also not going to help you pay your bills. Money pays bills. Most of us get money by working.

Education is an investment…and like many investments, there is no guaranteed return on that investment.

At this point, you are short of funds, and the wolves may be howling at the door very soon. So, it seems a no brainer to keep the job (for now—it earns money), withdraw from school (for now—its costing money) and return to school when you are in a better financial position to do so. To try to continue work and go to school will give you no good results with either…in fact, there is the highest probability that you may lose your job and NOT do well in school.

Before withdrawing from school, talk with the faculty, staff, counselors….and perhaps even the school psychologist….OK, social stigma time….but find some way to learn good strategies for dealing with stress (which is something that is probably adding to your woes). They may have other suggestions….but the key problem seems to be money, and if you don’t qualify for loans…grants and scholarships are the only other avenues…but often require decent grades and good faculty recommendations.

Also, before withdrawing from school, sit and talk with your boss / supervisor. Find out exactly where you stand with the company. Discuss with them your withdrawing from school and how this action will be taken regarding your work status / evaluation. It is important for you to know if your withdrawing from school will make a difference about them wanting to keep you on. If they will keep you….talk with Human Resources about education benefits in the company (if they have them). Ideally, your current job may have something to do with your major…in which case, if you are a good employee, they have an interest in your improving your ability to do your job. If they won’t keep you on, you need to find another job….and FAST.

Learning is a life long endeavor. You don’t stop learning when you graduate with a degree. So, if you continue to work, and if this job is related to your major, there may be some tax relief available. (If your current job is NOT related to your major, keep the current job, but find one that is more aligned with your major.) Talk with a tax accountant, but I believe there is a chance you can deduct some education expenses if the course improves your ability to do a job you already have AND does not qualify you for a new job. (see http://www.irs.gov/publications/p970/)

Undoubtedly it will take you longer to finish a degree. But if you work and go to school part-time, one major advantage is that when you graduate you already HAVE a job and you might even get a promotion. On the other hand, most other students will graduate and the have to FIND a job.

Write to your creditors NOW and explain your situation and seek reduced payments until you can get back on your feet. Propose a minimum payment that you know you can make, and then make them on time or early. That can buy you breathing room, but it will come at a high price….large interest payments. So budget to reduce all of your expenses to the bare necessities…and put every extra penny against the debt…but do it in a clever way. Interest charges are calculated based on the remaining principle of the loan. So, make your newly negotiated minimum payment on time. If you can, make another payment using any extra money about half a month BEFORE the next payment is due….and specify the full amount of the extra payment is to go against the principle. This will reduce the overall interest payments over the life of the loan and can save you considerable money.

For the car situation…do you belong to AAA (auto club?). If so, they often have diagnostic clinics…about a $35 fee and they analyze and trouble shoot your car. Since they do not do repair work, they have no reason to scam you. Then, armed with the diagnostic, consider finding a community college nearby with an auto mechanics class….and see if they have a program to work on cars…could be a lot less than a regular shop…and maybe with the work being done by fellow students, they can better empathize with your situation and help you out more than a regular business might do. Keep the auto club diagnostic tucked away as an Ace up your sleeve….and see if the auto class repair suggestions match the auto club diagnosis….if they don’t match, don’t authorize any work to be done…Could be a good way to keep you from throwing more money into bad auto service.

I am sorry to hear of your woes…and hope this reply will help you make a good decision for yourself. Best wishes for your future…things will get better…and someday you will look back at this moment and maybe even have a chuckle or two about it. Whatever you do, keep a good sense of humor, take a deep breathe, smile, and strive to have a better day.