Single mom, $29,000 in debt

By MP Dunleavey

Editor's note: Join columnist MP Dunleavey and a group of women as they seek to strip away the myths around money, liberate themselves from debt and find financial sanity. Follow the quest of the Women in Red every other Wednesday in Dunleavey's column on MSN Money.

People often ask me what it takes to become one of the Women in Red. While there are no fixed criteria, when choosing a new member I tend to look for two things:

• Someone with interesting (i.e. challenging) financial circumstances.
• Someone who has the grit to make serious changes in her life and habits in order to deal with them.

Kimber, 28, a single mom living in California, has both.

A pocketful of money mistakes

Like a lot of young people, Kimber put her first foot on the slippery slope of debt while she was in college.

Even before she enrolled, "during a campus visit, there were all these credit card applications you could sign up for -- and I could claim $20,000 in income, just based on what I was paying for tuition," she remembers. "I got three cards!"

By the time she graduated, Kimber had more than $3,000 in credit card debt.

"My dad tried to explain to me that this wasn't free money, but it didn't really sink in," she says. "I definitely learned the hard way."

She also had poor credit from not paying her bills on time, so when she decided to buy a car, she ended up with a $15,000 loan at 18%. "My senior year, I had a $400-a-month car payment," she says.

A medical nightmare

Graduating from college without a job and massive debt was tough. Then real disaster struck. After eating tainted food in a restaurant in 2003, Kimber was infected with salmonella.

To make a long, nightmarish story short, Kimber didn't get adequate treatment and ended up with an emergency hospitalization.

Her medical bills totaled more than $10,000 -- and because she was uninsured and unable to pay, they went into collections.

When I first spoke to her, Kimber explained that so many people got salmonella that there was a class-action lawsuit against the restaurant, and she was waiting for a possible settlement.

Beyond the money

Like so many young girls, I once dreamed of being an "amateur detective" like my hero, Nancy Drew. Writing about money brings out my inner sleuth, because no matter what the numbers look like, the story behind them is always far more complex.

At first glance, Kimber's situation looks pretty daunting. But what I find fascinating about the Women in Red is that these women are greater than the sum of what they owe.

Despite her predicament, Kimber has at least three things going for her. First, the grit and determination I mentioned above. Second, she has a good job as a facilities coordinator, managing three buildings for a publishing company. Her gross yearly income is $40,000.

Last, you might think that having a baby in early 2006 could have been the financial last straw, but in fact, it was a turning point for Kimber.

"I have been working really hard to understand how I got myself into this situation, because I don't want my son to follow my footsteps."

A change of heart

I admired Kimber's feisty spirit. Whatever mistakes she had made in the past, she seemed committed to taking a new course now.

But I was forgetting rule No. 1 of being a personal-finance detective: Do the numbers. All the numbers.

That's when Kimber told me about her most recent hurdle: Just a couple of months ago, she and her boyfriend split up. He moved out and Kimber is now paying all the bills, on her own.

Given that her net pay is about $3,000 a month, after withholdings for tax, health insurance, 401(k) and her flexible spending account, Kimber was in no position to cover $900 in rent, $600 for child care, $400 for her car payment. . . .

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