Sheesh, $1400 rent?? so after tax money that's 16800 a year on rent; pretax money it's about 24K a year?? I'm guessing her effective take home pay is about 1500 after all is deducted? that is a tight budget. I'm guessing of that 1500, at least 100 bucks goes to phone and internet, 200 bucks on food, hundred bucks on transit.

First, if living at home is an option, I'd definitely start there. Or like someone suggested, get a roommate and cut rental costs in half.

I can help her out. :ifyouknow:

All jokes aside. She appears to be in an emergency already if you ask me. So why not use her emergency fund to get out of debt?

All it takes is discipline. I think if she manages, she can lower her monthly living expense (food, bills, going out, etc.) And if she can, move out to a cheaper place. Living by herself for 1400 is a little much.

With that said, I would pay the 5k lump sum and 2k and then put whatever she can towards the provincial loan. Then slowly pay off the rest.

1. Set priorities
2. Make staying on priorities, priority
3. If under any circumstances, where life and death is not a factor, stay on those priorities.

In my opinion, people always wanna keep some money for emergency but if you think about it, loans that rack up interests, especially high balance loans like hers, IS an emergency. Nothing will drain a person's life more than compounding interests. The faster she gets those debt out of her life, the faster she can be worry free.

Does she have a credit line or a high credit limit credit card with low balance transfer interest rate for a period of months? Because those can act as emergency funds when she absolutely needs it.

The other thing is pride. Yes, great that you wanna do things on your own, but if you have interest building debt when your parents are offering to help, take it. Again, if they aren't in desperate needs themselves, the money isn't going with them when they die. If parents are an option, leverage that. Now is better than later when debt can balloon from compounding. It's like, if you have an illness take care of it ASAP, before it grows out of control. Same issues as here. $16k in savings when you have a debt growing with interest would be time to use that emergency fund. If she's simply saving, and not using that money for any appreciable investment gain, it's dead money, eroded by inflation. Again, $1400 on a single salary of $50k is not a smart move financially. It's actually outrageous since she's especially when she's paying the mortgage payments for someone else.

It's about as bad as it gets when half of your earnings are already eaten away by cost of housing.

Get a roommate ASAP. That rent has to come down, srs.

Let's do the math a bit different....Her take home is $3,200 a month less her rent of $1,400 which leaves $1,800

What is she spending $1,800 on each month?

cancel cable, no new phone, no Starbucks or bubble tea, brown bag lunch, don't eat out every night

cut the spending!
cut up the credit cards

The general rule of thumb for the percentage of gross income that should be allocated to rent is 25%. Based on her income, that's roughly $1,000/month. I believe that if she can find someone to takeover he lease, the penalty for early termination of the lease could be forgiven. If that's not the case, once her lease is up, I'd suggest that she look for rentals that fall within that figure. This will free up $400/month that can be put towards her debt.