Debt Reducers

[alicenwonder99]

The more I think of my cc company (Bank of America) not lowering my interest rate, the more mad I'm getting! I've already saved a balance transfer code for 3.99% of the life of the "loan" to my Chase card. I really hate switching my balances around too much. It just seems to get me deeper in debt for some reason. But I think the difference between 23.99% and 3.99% is too huge to pass up.

I also contacted my mortgage broker to see about a refinance. I told him I will either want to add my 2nd mortgage into it, or get some cash out to pay off some (well, at least the high interest) cc debt. He's getting my house appraised so I'll find out today. We moved into this house over 2 1/2 years ago, and we already have about $100,000 equity. I'm not sure getting cash out to pay off cc debt from my refinance is a good way to go. It sure seems like a quick fix to get this high interest debt gone. But it really is just moving debt around. I just have to come up with a plan and STICK TO IT.

I watched the documentary Maxed Out last night. WOW! It just really made me madder about all of this evil debt. Dave Ramsey is also in it. I checked it out from the library. If you haven't seen it yet, make sure you do!

 

[Heluvsme]

We're on the 2nd year of our 3 year plan. This year, by July, we will have written out $30,000 in checks to pay down our debt. It's really hard to even write that, I'm ashamed we let it get that bad, but on the flip side, I'm proud that we're able to pay it down ourselves. We didn't get any help, just something we'd been waiting for the right time for. We had to wait for some stock options to gain, we had to wait for a couple loans to be paid off, and now, by this time next year, we'll be out of debt except for our home loan, which we refinanced and is now down to $893/mo. We stick very close to a yearly budget, food, clothing, even down to the last $10 is budgeted. We have a small safety net in our savings if there is an emergency, and hopefully there won't be one.

It's hard, it's not something that's easy to talk about with people, and even though we may think we had a really valid reason (son diagnosed with a disability and me not working to stay at home with him and us paying OOP for all of his therapy since it's not covered by insurance), to a lot of people, they just hear the dollar amount of your debt and immediately jump to judgement.

Debt, it feels like you're swimming in peanut butter doesn't it??

 

[lttlmc3]

bump!

 

[smiller]

Count me in!

#1 Goal: no new debt
#2 Goal: reduce current debt

I've got the small emergency fund (and add $10/wk), I'm using my envelopes for all discretionary spending, I pay all my bills on time, I'm putting almost 10% gross in my Roth IRA, and I've added $50 to the minimum payment on my smallest bill.

I'm finally starting to feel that I'm moving forward and not backward with my budget.

Here's to snowballing!

 

[problemchild718]

I'm in too! We have paid off the cc and vowed not to use them unless a true emergency. (we just had our 2nd cash Christmas-no cc!) We need to pay off a car and get our emergency fund padded. Then worry about college bills that will be coming soon ad another child for braces.
I just feel like it will never end....

 

[lttlmc3]

Now, what kinds of things can we all do to reduce our debt?

 

[Illuminations_Rocks]

You are all inspiring! I have a large student loan debt I'm going to try to pay down. I've been making rather large payments for the past few months (I just graduated a year ago) since I've had a good job, so I hope that in 2 more years I can eliminate it. I'm thinking it'll probably be 3 more, but hey, that beats the 25 years I have to pay it back! I have already paid off my accumulated interest and that just felt soooo good.

Other than that I don't have debt. I pay off my CC in full each month and really only use it when I buy something off the internet or stay at a hotel - I am just leery of them having my bank info on my debit cards. I am still using the car my parents bought me when I was in college, and hopefully it'll last a few more years.

DF and I are getting married at the end of August. So we'll be spending a lot on our honeymoon to WDW. This is something we've both earned and are saving for; I told him we weren't allowed to go since our trip last January 2007 until our honeymoon so we could save money. He is a major Disney junkie. Living in CA though we did go to Disneyland a few times - but we live less than 3 hours away. The most expensive trip we took there was when we got engaged and we even had an AP discount on the DLH.

We're also going to be moving next month to Columbus. Housing is a lot cheaper there than here in Bakersfield, but we think our utilities are bound to go up since the weather here isn't too extreme (well except for the heat in the summer but we were at work during the day and the cat didn't mind it being 78 in our apartment). Hopefully we are slightly better off there. Well, no matter what we will be, he got a nice raise with his promotion. While I'll have to take a small paycut (we pay by cost of labor in my company), I just got a raise, so all in all it'll be like a 1-3% difference - the big difference being I don't get overtime pay in Ohio while I do here in Cali.

DF has no debt but also has no credit. I want him to get some credit so my good score isn't the only thing carrying us.... Any ideas? My only thought is for him to get a credit card, it'll have an annual fee and I'm sure start up fees, but is this a good start? He'd also pay it off in full each month, of course. A car loan is out of the question for him; he doesn't drive. Our utilities, except for cable, are in his name, but this doesn't do anything does it?

I can't wait to keep reducing!

 

[smiller]

Now, what kinds of things can we all do to reduce our debt?

I made a deal with myself that any extra money I earn, from odd jobs I sometimes get asked to do, half goes to debt reduction and half goes to fun money. That way, I'm motived to work extra when I can! Who doesn't like fun money AND what's funner than reducing your debt? It's a definite win-win.

I also use envelopes for EVERYTHING to stick within my budget. It really helps me appreciate what I have and what I can afford, and makes me realize all that junk that I really don't need!

I'm very thankful for the CVS threads and No Buy threads here on the BB, too!

 

[Heluvsme]

The little things we do are really that---little! But they really can add up! For instance, I turn off all lights when they're not being used. I put my computer to "sleep" when it's not being used.

I buy store brand at the grocery store, that saves a LOT. Also, I get the rewards from shopping at Kroger, so I save $.10 a gallon on their gas.

I stopped the newspaper.

I cook in the crock pot a lot, we can get several meals out of one pot....tonight is chili, $4.70 total, we'll eat it for 3 nights.

I pay all my bills on time to avoid late payments.

I've turned my thermostat to 63 and only turned it up on about 4 or 5 occasions in the past month.

I use a lot of baking soda instead of buying expensive cleaners. It also makes cheap kitty litter better!!

We eat in season. If it's not strawberry season, I don't buy them...too expensive.

I can't wait to read the other ideas, great topic!!!

 

[lttlmc3]

When my husband leaves for his training, I'm going to have a lot more opportunities to save money and pay more debt off. He leaves February 9th. I plan on getting only food on sale and keeping the heat on only on a limited setting. Plus, we won't be buying food for two, or buying gas for two vehicles and things like that. I plan to go without a lot so that we will have a lot of the debt paid off when he comes home. That's my goal!

 

[momtostitchandbuzz]

Little things I have been doing to help have a little extra money to get rid of debt include:

*Getting rid of my Entertainment Weekly subscription

*We stopped receiving the paper

*I picked up a extra shift at work.....still trying to talk myself into picking up a couple of more, I know one isn't going to help much, but I hate being away from my kids more than I have to

 

[minnie1928]

DF has no debt but also has no credit. I want him to get some credit so my good score isn't the only thing carrying us.... Any ideas? My only thought is for him to get a credit card, it'll have an annual fee and I'm sure start up fees, but is this a good start? He'd also pay it off in full each month, of course. A car loan is out of the question for him; he doesn't drive. Our utilities, except for cable, are in his name, but this doesn't do anything does it?

I can't wait to keep reducing!

Verizon used to report to the credit bureaus, I'm not sure if they still do. A credit card is probably your best shot. If you want to get one at a low cost, try a store card.

 

[minnie1928]

When my husband leaves for his training, I'm going to have a lot more opportunities to save money and pay more debt off. He leaves February 9th. I plan on getting only food on sale and keeping the heat on only on a limited setting. Plus, we won't be buying food for two, or buying gas for two vehicles and things like that. I plan to go without a lot so that we will have a lot of the debt paid off when he comes home. That's my goal!

That sounds like me! DH was recently promoted and we'll be relocating once school is over. So, for right now it's just me and the kids during the week and he's home on the weekends. The kids and I can tolerate setting the heat lower and our food bills should be lower. All the savings will go be put aside in anticipation of our move. Once we get past that, then I'll get back on track and pay down/off our DVC.

 

[FirstTimertoDiz]

bump

 

[smiller]

I paid my Disney Visa in full today (well, scheduled the payment at least! you know how it is online), which I do every month so the rewards are actually worth it.

Didn't reduce current debt but sure kept new debt from accumulating!

 

[hhartill]

You are all so inspiring, since the first of the year my family and I have been living on a budget and doing the debt snowball. My husband gets big end of the month checks so this has been a hard January! It's cold here! It's nice to read that we are not the only ones.

We should be debt free by our next trip to DW in Dec/08. It will be nice to see the parks without dragging all that debt with us.

As you can see...I'm new at this....did I do it right?

 

[tmarquez]

Count me in too!

I haven't officially started yet, but next month my car will be paid off...so I will have extra money each month from that to pay off other things. Mainly I want to pay off the credit cards and start paying DH's truck as far down as we can.

I was wondering what you guys are doing in terms of the "emergency fund". Are you saving a set %, enough to live off for a couple of months...? I need to start there and will be using our tax refund as well as some money my mom is paying us back when she gets her tax refund.

In addition to the extra money from my payed off car, in May my stepson turns 18 so his child support will be over (although he will be going to college, so that may end up costing us more), and my DD starts public kindergarten in August (that's $400+ in our pockets each month due to no daycare). So hopefully we can really most things payed off this year.

I haven't read any of the books mentioned, but will go to the library tomorrow to see what i can find.

 

[tinkryansmom]

DF has no debt but also has no credit. I want him to get some credit so my good score isn't the only thing carrying us.... Any ideas?

Congratulations on your upcoming wedding! And your move! It is an exciting time for you to be sure.

My advice on the no credit issue is to have DF get a secured credit card. He would open an account, think like a CD, it would earn good interest, and then that amount would be his credit limit. So in reality he is using his own money but it works like a credit card.

I had one after I ran up debt after college and it help re-establish my credit quickly.

 

[MsLeFever]

I'm in! My DH and I have been doing some serious talking about our debt. We are both picking up one-time extra jobs because without extra income this debt just wasn't going away.

Our interest rates are high and it was frustrating to see even a large payment get eaten up in interest. We have 3 credit cards. We are paying off the Disney VISA in Feb!! (those extra jobs are paying off)

Then we have decided to take out a loan from my retirement (we aren't anywhere close to actually retiring) to pay off the rest of the CCs. The retirement "loan" (it is really your own money so it doesn't show as a loan on a credit report) will "charge" 6.5 percent - but that interest just goes back into my retirement so we will be paying the interest to ourselves. All of this means that our large CC balances will be zero as of March and the actual debt will be gone in 3 years!

The "extra" will be put aside for a downpayment on a house - and to give us a cushion so that the next time a car need $1000 worth or work we just have it!!

Good Work and Good Luck to all of us!
Barbara

Already told the kids that unless we really get a bunch of extra work that no WDW this summer - but that will mean a better (cash only) trip in a year or 2!

 

[Chicago526]

DH and I will continue our debt pay down, we started in earnest in '06. We have three years left and then we'll be car and consumer debt free, assuming nothing major happens in the meantime. Actually, we may not be car debt free, it's two more years to pay of DH's truck but by then we'll be looking to replace my 10 year old (by then 12 year old!) Saturn. If it's still in good shape in two years, we'll bank the old truck payments until it dies and have a good down payment for a replacement, but I doubt we'll be able to pay in full for something. Oh well, we'll also be CC debt free so I won't mind a small and short car payment!