Reality TV Meets Personal Finance

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Each week on SOAPnet’s new original reality series Bank of Mom and Dad, a twenty-something woman who is drowning in debt must pay the ultimate price ... letting her parents move in! With the assistance of money coach Farnoosh Torabi (that's me), Mom and Dad will teach their daughter to rethink her spending habits and transform her relationship with money.

In last night's debut episode, we met debt-ridden Christina Caparoula from Queens, New York. The 33-year-old actress/bartender was carrying some $35,000 in debt consisting of credit card balances, student loans, a personal loan and overdue parking tickets.

The good news is Christina earns a decent salary — $2,500 net each month — which can afford her an aggressive debt repayment plan if she is willing. The bad news is she has expensive habits that are hard to break, overspending an average $1,000 a month on dining, yoga and travel. “I want to have my cake and eat it too,” she told me during our first meeting. Talk about living it up but not paying it down!

For Christina the key challenges were lowering her car expenses, her yoga membership and her costly grocery purchases. If she began by scaling back on these expenditures she could begin paying down debt and affording health insurance, which, by the way, is a need not a want.

Embrace Public Transportation. Christina’s car payments, insurance and gas totaled more than $700 a month, not including her $1,000 in overdue parking tickets. While she claims the car is her source of freedom and escape from the city, the cost of keeping and maintaining the car in New York (which by the way has the largest public transportation system in the country) is outweighing the benefits. Selling her car and resorting to public transportation could shore up $600 a month or $7200 a year.

Eat Well for Less. Fifteen dollar bottles of olive oil and $4 bottles of water quickly add up to an average $150 grocery bill for Christina. Sticking to generic or store-brand labels and clipping coupons could easily trim her grocery bill in half. And that’s not including how much she’d also save by eating at home versus her tendency to dine out.

Secure Health Insurance. Christina has very weak knees and if she doesn’t seek medical attention soon doctors say she could face severe consequences down the road, including disability. While she can’t receive medical insurance through from her employer, Christina has several alternatives, including state-run insurance programs and benefits available through the Freelancers Union. For this she should expect to budget for health insurance premiums at around $200 to $250 a month.

Barter for Yoga. Christina didn’t know but her yoga studio offers members free unlimited classes in exchange for five hours of office work at the studio. The savings? At least another $75 per month. In a year that’s $900.

Catch a new episode of Bank of Mom and Dad, Wednesdays at 10 p.m. on SOAPnet.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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