Some GameStop investors started with one goal – to pay off debt

Den Kovacs, a 25-year-old Detroit-based IT professional, transferred $ 1,000 of his emergency savings and $ 200 that he set aside for student loan payments to his Robinhood account – all with the goal of getting a slice from GameStop mania. On January 25, he sold his other shares to buy four GameStop shares for $ 80. After selling four shares for $ 212 on January 26, he bought six more shares for $ 292, according to commercial receipts. provided.

Your ultimate goal: earn enough money to pay your $ 7,000 debt by credit card.

Kovacs and many other individual investors have followed the frenzy on Reddit, Discord and other platforms. On Friday, Kovacs sold his seven remaining shares for $ 352 and said he plans to use the earnings – almost $ 2,500, according to the commercial income provided – to pay off part of his credit card debt.

“I want to put myself in a position where I’m not in debt like that,” he said. “This is damaging my credit score and I want to be able to move elsewhere. Therefore, I want to pay the debt with everything I gained from it. ”

As a forum, WallStreetBets usually ridicules those who sell because many want to leverage the group’s power to continue bullish. But when it comes to paying off debt and achieving other savings goals, some users have changed their tones.

A Redditor posted a screenshot of what he said was the final payment on his student loan: $ 23,504.45 from GameStop negotiations.

“I never thought I would pay this early,” posted the user.

For some traders who plan to use their unexpected earnings to eliminate their student debts and pay other obligations, it seems worth betting on.

Amina Spahic, a 28-year-old communications specialist from Florida, originally bought two weeks ago for $ 38 a share. She has already used part of her earnings with GameStop to pay off debts and put the rest back on GameStop. Having already made her changes earlier this week, she said she has no plans to sell yet.

“I knew there was growth and potential,” she said. “I told everyone I knew, ‘I’m seeing this on Reddit. Do it.'”

Generation Y average credit card debt rose to $ 4,322 in the third quarter of 2020, according to Experian analysis.

More than 22 million borrowers with direct federal student loans stopped payments during the pandemic, according to data analyzed by Mark Kantrowitz, author of “How to Appeal for More College Financial Aid”.

Some traders have begun to imagine earnings for financial milestones that remain out of reach.

Anthony Eleftheriou, an 18-year-old college student who lives with his parents in London, started investing just a month ago. He bought 25 GameStop shares for $ 50 on Jan. 22 and said he plans to keep it for now, perhaps even using his earnings to pay monthly fees.

“I kind of wanted a quick fortune, but now it’s become a long-term thing,” he said.

Joe Ballent, a 32-year-old assistant physician who works in Cheyenne, Wyoming, said he is prioritizing a few other goals before his student loan debt from GameStop earnings: first, paying for the upcoming wedding and then save until you buy a house. Both seemed out of reach before the GameStop rally, he said.

“I feel that there are many people who have never been able to make progress. I assumed six digits of debt [for graduate school] and I worked two jobs before school, but now I can’t afford a house? “

Ballent started putting more money on the market last year, first with RobinHood and then with accounts at Vanguard and Schwab. He now has more than $ 10,000 invested in GameStop, according to the commercial income provided. He is selling shares little by little, using part of his earnings to pay for the wedding and help with medical expenses for a loved one. After selling everything, he wants to start his search for housing.

“I’m sure I’m just a small fish compared to some of those people,” he said. “But it is important to me and I still want to see where it is going.”

Following RobinHood’s decision to join other brokers to curtail fast-growing stock trading, Miss Spahic said she plans to close her positions and delete the application. She is still following the conversation on Reddit to determine which broker she will choose as a replacement.

“I am following closely what each of them is saying,” she said. “I’m waiting to see who comes out on top and says it is for the people.”

Meanwhile, Kovacs and others are keeping an eye on WallStreetBets.

“I think people recognize that there is an opportunity here,” he said. “You see those gains and look at what happened earlier this week and think, ‘Is everyone collectively right or is everyone collectively wrong?’ Just like me. “

—Marco Quiroz-Gutierrez contributed to this article.

Write to Julia Carpenter at [email protected]