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I have a very close friend named Niffler. He is in very serious debt and needs to pay back a loan of $10,000. Currently, however, he is unable to pay back this debt. This is a guide to explain what will happen to him and to come up with ways to pay back this debt.

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If Niffler is unable to pay back this debt, these are the consequences:
-His credit will be affected: Niffler's "credit score will drop," (9)  which will decrease he chances of getting another loan, a credit card, or buying a car or a cell phone.
-Nifflers applications may get denied: "Debt collections are a serious delinquency and signal to other creditors and lenders that you haven’t always kept your payment promises," (9). This means that banks will see him as a very risk investment and will be denied some of their services.
-He might have to pay a higher interest rate. This is to "compensate for the increased risk of nonpayment" (10).
-He may also have a harder time getting a job. There are some employers who also like to check credit scores, which, when low, will keep him from upper management jobs.
-Niffler can also be sued. Debt collectors are allowed to sue for a debt of any size, and since Niffler borrowed $10,000, his chance of being sued only increases.

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I can help Niffler by creating a plan:
- The first step to overcoming his debt is to develop a budget. Developing a budget will help Niffler control of his financial situation. It will allow him to do a realistic assessment of how much money he takes in and how much money he spends. To do this he needs to start by listing his income from all sources. Then, he needs to list his "fixed" expenses. Next, he needs to list the expenses that vary. Writing down all of his expenses can help him track his spending and make cuts on any unnecessary funding.
- If he is struggling with significant credit card debt, he can contact Debt Relief Services. They might be able to give him advice on how to deal with bills

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Niffler has a monthly house payment of $1,442. He works as a zoologist and makes $61,660 annually, which is $5,138.33 a month. He owes this money to a bank that charges 3% interest. Niffler will need to set aside about $100 a month for groceries for himself. He is also paying a monthly car payment of $479. Lastly, he needs to set aside around $200 a month for an emergency fund, for clothes, or any other things he may need to buy. The term of his loan is 5 years. This adds up to $2,221. To pay back his loans, he would have to pay $179.69 a month for 5 years. So, he ends up paying $2,400.69 a month, which leaves him with $2,727.64 a month. Niffler can save this money in case he needs it in the future.