Debt Dumpers 2024

[WDW_fan_in_TX]

I didn't realize how bad fees were until I started looking at my bills. Typically, I would just pay it online when it came due and not look at the bill to see what we were paying for. We paid everything late (cable, electric, water, car, everything). Every single one had a late payment fee, anywhere from $8-$30. Even my credit card has fees, A monthly annual fee, plus my regular APR plus a credit protection fee. Man, there are fees everywhere we're paying.

Along those lines, do I have to have the credit protection fees? They're only about $10/month for each card. But that's $120/year per card. Can I call and do away with those? Or at least some and maybe just keep 1? Don't know anything about them, and it might be something I need to call the credit card companies for. Not sure.

Good. Avoiding all bank fees was at the top of my list for ways to help pay down debt.
So next step is to apply any extra payments to the principal.

 

[pblack]

I'm not even sure what a credit protection fee is. Is it possible to switch to a card that doesn't charge you a monthly fee?

 

[WDW_fan_in_TX]

Not sure. Both credit cards I have charge annual fees. I think 1 is like $175 while the other is like $75 or something. I researched when I got the offers to figure which was best for me. And those were the ones I was guaranteed to get.

 

[pblack]

I mean I'm not opposed to credit cards that charge an annual fee, as long as what they're giving you in exchange for that fee is something you use/is beneficial to you. If it's not something you use, I'd suggest trying to call the company it's through and see if you could downgrade to a card with no fee.

As far as the credit protection fee, from my quick Google search, I'd get rid of it if it was me. But you may want to do some more research on it and see if it's something you want to continue paying for.

 

[Nettlelondon]

I didn't realize how bad fees were until I started looking at my bills. Typically, I would just pay it online when it came due and not look at the bill to see what we were paying for. We paid everything late (cable, electric, water, car, everything). Every single one had a late payment fee, anywhere from $8-$30. Even my credit card has fees, A monthly annual fee, plus my regular APR plus a credit protection fee. Man, there are fees everywhere we're paying.

Along those lines, do I have to have the credit protection fees? They're only about $10/month for each card. But that's $120/year per card. Can I call and do away with those? Or at least some and maybe just keep 1? Don't know anything about them, and it might be something I need to call the credit card companies for. Not sure.

Again - caveating this with that I am in the UK. There was a massive scandal here a few years ago when people realised these fees were being automatically added to bills, often a small % of the total balance or total credit available on the card without people really understanding what it was for. As a result it became much less normal for them to be added automatically.

Additionally a lot of people then started reading what the protection actually covered and discovered that they would never to able to take advantage of the protection - for example they were self employed and it only covered the balance if you were unable to pay due to being made redundant. As a result many lenders were accused of misselling the cover and had to refund lots of money, and add compensation to those payments.

At the very least I would have a look at the terms and conditions of the cover and the card itself. If they are cards that are intended for those with poor credit there may be a requirement to have to cover - in which case you may need to sit tight for a bit, improve your overall financial position and then look at different cards that are less restrictive.

If you aren't sure I am sure someone on here could help point you to more local resources that can help you to look at your options.

And you are definitely moving in the right direction - asking questions, reading documents fully, looking at fees and the like all helps to build a better financial strategy for the future.

 

[amylevan]

It’s possible the credit protection fee is required if you have bad credit. But you can call and ask.

You need to pay bills on time. All the extra late fees could be money you could be putting towards principals. Even $8/month could help lower something else.

Do you have a budget set up?

 

[piglet1979]

Yikes! This was another factor that led us to completely reevaluating our finances. Our oldest is going to be a senior next year. When I started running NPC calculators and checked the interest rates of current student loans I She is our oldest of five and we have always planned on our kids covering their college expenses and we would help as much as possible. But with these interest rates, we are trying to see what other options we can manage. We had not been in a position to open 529s, but once we get these debts paid and ensure we are saving enough for retirement, we’ll open them for our other kids. We should also be able to cash flow a decent amount each year for her as she’ll be the only one in college for all four years she attends. And the other kiddos will have 529s so we’re hoping they can all manage college with minimal debt.

This is us too. We were young when we had the kids and had no money to spare. DH had only been working at his company for 2-3 years and I was working at a daycare making no money. I got a new job (still making very little but had the possibility to grow) and we both have moved up where we are at. We just never got to the 529 plans quick enough. Both kids know they will have to pay for their college. We had the kids back to back. DS is a senior and DD is a Junior. This is not helping us either.

One option you can look into is taking college classes while in high school. DD is doing this. She took 2 classes this past summer (see needed for high school not college but wanted to get them out of the way). This year she took Comp 1 in the fall and Comp 2 this spring. This covered her 11th and 12th grade English credit at high school as well as the college requirement. She only needs a math class to graduate so she will take a full class load at college next year. This is all free under CCP (College Credit Plus). I am not sure if this is an Ohio thing or not though. When she starts college and needing to pay for it, she will have a year done already. On the plus side it also can boost your weighted GPA as college classes are on a 5 point scale.

Also, do a lot of scholarships. My kids are not able to apply for any scholarship that we have at my work (most of the ones in our area) so that is a bummer. We are looking at others at the college he wants to go to as well his work. He works at McDonalds and they have a scholarship for employees. I also know Caine's and Chipotle have them so if your daughter is working this might be something to look into as well. We are hoping that he will get enough scholarships to where he will only need to take out a small loan or be able to pay out of pocket.

 

[slightly_obsessed]

It was very frustrating because they are pushing this on students that don't know any better yet. I haven't heard of the one for medical but something for us to look for when helping students.

His loan was for our state and was for med school only. Though I am sure other states have the same type of program; the idea is to get doctors to rural areas or VA clinics/hospitals.

we use a single card the same way for the same types of purchases. i let the points build up and if our expenses exceed what i have budgeted for for groceries/fuel for a given month i apply the points to offset. if our expenses are less for a given month i transfer the difference from my checking to a small savings account we use for higher expense months or that curve ball (but i also have a small amount budgeted monthly that is earmarked exclusivly for christmas).

That's a great way to use of those points. Love that idea.

costco has some GOOD prepared items and they can be much less expensive than eating out (esp. if they are having a sale). dh is a fan of korean bbq so we get the big container and break it down into single servings to freeze. some of their prepared stuff though is overpriced and can be gotten for less if you look to the ingredients-2 we do this with is the street taco and gyro kits. it's much less expensive to buy one of their rotissery chickens, chop it yourself and season the meat/they sell bottles of the cilantro lime dressing so it nets a good savings (and you can also freeze the seasoned chicken for future use), they sell the gyro meat in double packs (also freezable) at a much lower per pound price so we grab those and grab pitas and tzatziki when we plan to have them.

Gonna go add their gyro meat to my shopping list. That is definitely one thing I miss from living in larger city.

 

[piccolopat]

I just wanted to shoot a little update before the weekend comes to an end.

We decided to pay off the loan with the Christmas money we were given, some of the money I made from selling baseball cards the last couple of weeks and put it with some of my paycheck and get that stupid thing paid off.

However, we saw a couple of oil spots under my wife's car when we came back from New Year's out of town, so I took it in Friday. We just had it in the shop in early December because of an oil leak. Now they found another. So we're going to have to put it back in the shop again. We got a quote of $4k. After talking to my wife, we decided to take it to another place and get a 2nd quote. Also, we want to ask around at church (we just started there last February) and see if anyone owns a place that can fix it for cheaper. The place we took it want to charge $200 per hour, and they think it'll take 16 hours.

Once that happened, we decided we needed to put whatever money we could toward the oil leak and put off paying our big loan until another time. However, the car place said the oil leak wasn't bad, and the oil level wasn't low. So it might be something we can go with another month or 2 and just keep an eye on the levels. That way we can indeed pay off that loan.

But we did pay on a couple of credit cards. Were supposed to pay a minimum payment of $25 on each, but we paid $40 on each. I know it's not much more, but it helped us pay on time (to help our credit score) and pay down some more.

We did go to the grocery store, so hopefully we don't have to eat out much. I tried to find something I could do for breakfast every morning, but I didn't see anything that I thought would work (I typically just grab something on the way to work). I don't like to eat too early, so don't like eating breakfast at home. Plus, I don't have time to make breakfast in the mornings. Thought about oatmeal packets, and I did do that a couple of times last week with hot chocolate. But that old fast. So not sure what I'll do going forward on that.

That's a small recap to the week/weekend. We've planned dinners at home this week and also got enough to cook to be able to take leftovers since we don't like sandwiches (there's not a toaster at work to be able to make a sandwich). So we're hoping not to spend any money this week.

Just catching up on this thread so I don't know if this is too late. There are some engine additives that stop leaks that you might try first.

 

[princesscinderella]

since the subject of fully understanding the terms of a loan has been brought up i want to share a practice that many consumers are unaware of until it impacts them to horrible consequences-

zero or VERY LOW rates over a multiple year period (retail installment payments)-

this is frequently used by furniture stores-you've seen the ads that tempt you with zero interest and VERY low payments for multiple years. what few if any who sign on for these notice is that in the fine print of the contract is a clause that allows that if a single payment is short by so much as a single cent, late by so much as a single day-the contract can revert RETROACTIVELY to an insanely high interest rate (in addition to incurring very high penalties and late fees). so that couch you've been paying for the last 3 years at 0% and your payment was a day late on gets the loan recalculated back to DAY 1 with a 30 plus percent interest rate on the original purchase price and you find out that what you thought would be paid off in 6 months now has a higher balance due than the original purchase price.

lousy practice but entirely legal.

Another thing to watch out for is that the minimum payment for that loan may not pay the whole balance off before the end of the 0%. They do the same thing if you don't pay off the entire balance.

This is such important advice!! Care credit which is offered at medical/dental/vet offices also has the same practices. The drs pay a fee off the top to offer the no interest promo period. Care credit hopes you don’t pay it off and only do the minimum balance on the statement. This won’t pay it off completely within the 6 or 12 month no interest period and once that ends bam sky high interest.

 

[MamaBelleRN]

This is us too. We were young when we had the kids and had no money to spare. DH had only been working at his company for 2-3 years and I was working at a daycare making no money. I got a new job (still making very little but had the possibility to grow) and we both have moved up where we are at. We just never got to the 529 plans quick enough. Both kids know they will have to pay for their college. We had the kids back to back. DS is a senior and DD is a Junior. This is not helping us either.

One option you can look into is taking college classes while in high school. DD is doing this. She took 2 classes this past summer (see needed for high school not college but wanted to get them out of the way). This year she took Comp 1 in the fall and Comp 2 this spring. This covered her 11th and 12th grade English credit at high school as well as the college requirement. She only needs a math class to graduate so she will take a full class load at college next year. This is all free under CCP (College Credit Plus). I am not sure if this is an Ohio thing or not though. When she starts college and needing to pay for it, she will have a year done already. On the plus side it also can boost your weighted GPA as college classes are on a 5 point scale.

Also, do a lot of scholarships. My kids are not able to apply for any scholarship that we have at my work (most of the ones in our area) so that is a bummer. We are looking at others at the college he wants to go to as well his work. He works at McDonalds and they have a scholarship for employees. I also know Caine's and Chipotle have them so if your daughter is working this might be something to look into as well. We are hoping that he will get enough scholarships to where he will only need to take out a small loan or be able to pay out of pocket.

Yes!! We hope to chase allll the scholarships. We want to be sure we’re fair with college expenses. Opening 529s is on the distant radar, but we’ll have to decide how much we can comfortably offer to each kiddo. We are in very different financial position than we were a few years ago and can do something for each of them, but it certainly won’t be covering costs at 100% (we’re definitely prioritizing retirement!). Our youngest three are much closer in age, so cash flowing won’t be possible with them.

Yes, her HS offers several dual credit courses. She is currently in three and will continue with more senior year. She should have a solid number of credits under her belt when she graduates.

We’ve talked extensively about summer work and where to apply. We also plan to hire her to babysit her younger siblings. We’ll pay her a fair wage ($15/h) and will encourage her to save that money for college expenses. We’ll only need her a max of three days/week (most weeks probably just two days) until 4pm, so hopefully she can find another job opportunity. She plans to apply to Starbucks, Target and JoAnn’s once she is done directing the youth theater show she is doing right now. I’ll have to have her do some more research on the other employers that offer scholarship opportunities. She just definitely can’t add anything more to her plate at the moment!

We’ve also talked about the possibility of a gap year since she is a young junior. She won’t turn 18 until August 2025 after she graduates HS. She plans to pursue nursing and I suggested she work at the hospital I’m at as a Patient Care Assistant. She already did a mini medical camp there last summer and volunteers once/week, so she has some sense of the hospital world. But there’s nothing like working there to determine if it’s truly the right fit!

Lots to plan and consider over this next year!

 

[focusondisney]

since the subject of fully understanding the terms of a loan has been brought up i want to share a practice that many consumers are unaware of until it impacts them to horrible consequences-

zero or VERY LOW rates over a multiple year period (retail installment payments)-

this is frequently used by furniture stores-you've seen the ads that tempt you with zero interest and VERY low payments for multiple years. what few if any who sign on for these notice is that in the fine print of the contract is a clause that allows that if a single payment is short by so much as a single cent, late by so much as a single day-the contract can revert RETROACTIVELY to an insanely high interest rate (in addition to incurring very high penalties and late fees). so that couch you've been paying for the last 3 years at 0% and your payment was a day late on gets the loan recalculated back to DAY 1 with a 30 plus percent interest rate on the original purchase price and you find out that what you thought would be paid off in 6 months now has a higher balance due than the original purchase price.

lousy practice but entirely legal.

Thanks for that. We’ve never financed furniture & never will, but it’s good to get that info out there.

 

[WDW_fan_in_TX]

We have not. I've wanted to, but my wife always shoots down the idea.

It’s possible the credit protection fee is required if you have bad credit. But you can call and ask.

You need to pay bills on time. All the extra late fees could be money you could be putting towards principals. Even $8/month could help lower something else.

Do you have a budget set up?

 

[AmyAnne]

So glad to hear things are now on the right track. I give you HUGE props for tackling this debt journey while balancing your DW’s concerns about maintaining funds. Sounds like you’re doing a great job. Definitely keep tackling that debt and your snowball will grow!

I’m 100% with you on the collaborative spirit. Talking about finances is still considered taboo by too many people and having a community to share ups and downs helps tremendously. And I totally feel you on the Christmas curveballs! That was certainly one factor that led us to evaluating our finances more closely. We looked closely and here we are!

Yikes! This was another factor that led us to completely reevaluating our finances. Our oldest is going to be a senior next year. When I started running NPC calculators and checked the interest rates of current student loans I She is our oldest of five and we have always planned on our kids covering their college expenses and we would help as much as possible. But with these interest rates, we are trying to see what other options we can manage. We had not been in a position to open 529s, but once we get these debts paid and ensure we are saving enough for retirement, we’ll open them for our other kids. We should also be able to cash flow a decent amount each year for her as she’ll be the only one in college for all four years she attends. And the other kiddos will have 529s so we’re hoping they can all manage college with minimal debt.


Continuing to plug away and grab all the extra hours I can! I worked yesterday and today for call pay, which will make a total of 50 extra hours on my next paycheck from call pay this week and last. This will go a long way to helping us jump start this debt pay off journey!

Regarding college: having put four through college with no loans for them or us (and a similar background to you--had kids young and didn't make enough to start saving until the oldest was in HS), be sure that you look into private colleges as well as public. I had always thought that our state U would be the most economical, but I was wrong, because private colleges offered my kids lots more scholarship money.

 

[Tygerlilly]

they sell the gyro meat in double packs (also freezable) at a much lower per pound price

We've been debating a Costco membership (we have Sam's already). The bulk gyro meat might be the tipping point. We can't find it anywhere around here unless it's in a kit and there's barely enough to feed us all. Plus I usually make mine into a salad anyway.

 

[princesscinderella]

Yes!! We hope to chase allll the scholarships. We want to be sure we’re fair with college expenses. Opening 529s is on the distant radar, but we’ll have to decide how much we can comfortably offer to each kiddo. We are in very different financial position than we were a few years ago and can do something for each of them, but it certainly won’t be covering costs at 100% (we’re definitely prioritizing retirement!). Our youngest three are much closer in age, so cash flowing won’t be possible with them.

Yes, her HS offers several dual credit courses. She is currently in three and will continue with more senior year. She should have a solid number of credits under her belt when she graduates.

We’ve talked extensively about summer work and where to apply. We also plan to hire her to babysit her younger siblings. We’ll pay her a fair wage ($15/h) and will encourage her to save that money for college expenses. We’ll only need her a max of three days/week (most weeks probably just two days) until 4pm, so hopefully she can find another job opportunity. She plans to apply to Starbucks, Target and JoAnn’s once she is done directing the youth theater show she is doing right now. I’ll have to have her do some more research on the other employers that offer scholarship opportunities. She just definitely can’t add anything more to her plate at the moment!

We’ve also talked about the possibility of a gap year since she is a young junior. She won’t turn 18 until August 2025 after she graduates HS. She plans to pursue nursing and I suggested she work at the hospital I’m at as a Patient Care Assistant. She already did a mini medical camp there last summer and volunteers once/week, so she has some sense of the hospital world. But there’s nothing like working there to determine if it’s truly the right fit!

Lots to plan and consider over this next year!

I know when the kids are teens our focus is on college, but if they have a job they are eligible to contribute to a Roth IRA. This is an amazing start on their retirement because they will earn so little that it’s basically putting it away for retirement to grow their whole life and pay zero taxes on that money ever. You would have to open a custodial Roth IRA if they are under 18 but it’s easily done on E*Trade. You can never get those early investing years back. Here’s a screenshot from a calculator assuming they contributed $15,000 to a RothIRA before they turn 18 and then put in a modest $500 each year til they retire based on average returns in the market. I think it’s as big a gift to get them in the mindset of saving for retirement as early as possible while time is on their side as it is paying for college.

 

[princesscinderella]

We've been debating a Costco membership (we have Sam's already). The bulk gyro meat might be the tipping point. We can't find it anywhere around here unless it's in a kit and there's barely enough to feed us all. Plus I usually make mine into a salad anyway.

I have memberships to Costco, BJs and Sams and Costco is the winner for me hands down.

 

[barkley]

Yes!! We hope to chase allll the scholarships.

YES!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

my oldest received the largest number of single scholarships in their graduating class. it was not the highest dollar amount but many of the higher dollar recipients only received scholarships that were for only freshman year-while oldest's were renewable for all 4 years

it was crazy-the high school would send out monthly notices of local scholarships and oldest's classmates would pooh-pooh them b/c they were not of the high dollar that the websites they hunted down touted. they did'nt think about how the websites were showing state and national scholarships that had much stronger competition. my oldest had a decent but not phenominal gpa, did some but no spectacular extracurriculars. we did applications for everything and as a result ended up with enough by graduation to cover freshman year UNTIL the state university found out (had applied to, was accepted but had not yet done the paperwork to formally accept admission) at which time they offered matching scholarship funds that ended up with a surplus that would qualify to roll over and cover a chunk of sophmore year

the kicker came when one very small scholarship notified us near the end of freshman year to remember to submit renewal paperwork for the following year's funds that's when we learned that most if not all were renewable (not advertised on original applications, not made aware of until we contacted them individualy).

my oldest ended up with enough small scholarships that renewed to cover FAR more than the classmates who got far more initialy but were one time shots.

look to-

local groups
local service clubs
your utility companies, credit unions, labor unions (grandparent affiliations work as well), affiliations (family who are members of organizations like the elks, moose lodge, masons, shriners.....can make eligibility to apply)
alumni (did you go to a state college-within the same state it may make eligibility)

We've been debating a Costco membership (we have Sam's already).

have any friends with one??? if so ask if you can give them some money so they can buy you costco giftcards. they sell them for as low as $10 each and allow a non member to buy whatever they want-and pay the difference in cash or a visa related card. oldest just went today-not a member so i buy $10 giftcards that allow, like today, -a $120 purchase absent membership. just flash the card at entry, and the only restriction is you can't use self check-out.

 

[piglet1979]

(we’re definitely prioritizing retirement!)

This is where we are at too.

She just definitely can’t add anything more to her plate at the moment!

I get that. DS only worked 1 day a week during the fall. He played soccer are was in the marching band. He has been working at lot right now but will cut back again when tennis starts. You have a great plan to help her out with her busy schedule.

We’ve also talked about the possibility of a gap year since she is a young junior. She won’t turn 18 until August 2025 after she graduates HS. She plans to pursue nursing and I suggested she work at the hospital I’m at as a Patient Care Assistant. She already did a mini medical camp there last summer and volunteers once/week, so she has some sense of the hospital world. But there’s nothing like working there to determine if it’s truly the right fit!

Lots to plan and consider over this next year!

DD is the same. She won't be 18 until the end of August of 2025. She really wanted to graduate this year and I told her no. She would have still been 16 when college started plus staying givers her a year of college for free.

One thing to look for with taking a gap year, is that it may take her out of the running for some scholarships. A lot of scholarships you have to receive when you are a senior. Our scholarship is like that. We do allow students to take a gap year and not lose their scholarship but they forfeit that year. This means their 4th year they may be able to get the scholarship. Just keep a look out for this.

Regarding college: having put four through college with no loans for them or us (and a similar background to you--had kids young and didn't make enough to start saving until the oldest was in HS), be sure that you look into private colleges as well as public. I had always thought that our state U would be the most economical, but I was wrong, because private colleges offered my kids lots more scholarship money.

Yes. We see this all the time at work. DS applied to several and right off the bat got enough scholarships to put them at the same cost as state schools. This is just the merit scholarship but he may be eligible for more. With FAFSA being so late this year, we won't know for a bit longer.

YES!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

my oldest received the largest number of single scholarships in their graduating class. it was not the highest dollar amount but many of the higher dollar recipients only received scholarships that were for only freshman year-while oldest's were renewable for all 4 years

it was crazy-the high school would send out monthly notices of local scholarships and oldest's classmates would pooh-pooh them b/c they were not of the high dollar that the websites they hunted down touted. they did'nt think about how the websites were showing state and national scholarships that had much stronger competition. my oldest had a decent but not phenominal gpa, did some but no spectacular extracurriculars. we did applications for everything and as a result ended up with enough by graduation to cover freshman year UNTIL the state university found out (had applied to, was accepted but had not yet done the paperwork to formally accept admission) at which time they offered matching scholarship funds that ended up with a surplus that would qualify to roll over and cover a chunk of sophmore year

the kicker came when one very small scholarship notified us near the end of freshman year to remember to submit renewal paperwork for the following year's funds that's when we learned that most if not all were renewable (not advertised on original applications, not made aware of until we contacted them individualy).

my oldest ended up with enough small scholarships that renewed to cover FAR more than the classmates who got far more initialy but were one time shots.

look to-

local groups
local service clubs
your utility companies, credit unions, labor unions (grandparent affiliations work as well), affiliations (family who are members of organizations like the elks, moose lodge, masons, shriners.....can make eligibility to apply)
alumni (did you go to a state college-within the same state it may make eligibility)

That is awesome that the scholarships were renewable. We have a lot of students that they have their freshman year paid with the small local scholarships but they are 1 year awards. It makes the next 3 rough with finding funding.

These are great places to look. Our high school as all of the local scholarships go through them. There is one google form. The deadline was yesterday and as of Tuesday only had 37 submitted application. There are like 300+ seniors. I was shocked. They have been sending reminders at least once each week since the beginning of January if not more.

My work has a lot of the county local scholarships. Because I work here, my kids are not eligible. It is really a bummer. It knocks them out of so many.

 

[DanceDisney23]

She plans to apply to Starbucks, Target and JoAnn’s once she is done directing the youth theater show she is doing right now. I’ll have to have her do some more research on the other employers that offer scholarship opportunities.

Is she applying to Starbucks only for the tuition assistance? If so, is she aware that this benefit only applies to online degrees from Arizona State University? They cover 100% of tuition which is pretty amazing, but online education isn’t for everyone, neither is ASU.

Tuition assistance from an employer can be a great help in paying for college, but many employers have guardrails around that benefit, either through partnerships with specific schools or by limiting the benefit to specific majors that are aligned with the company’s industry. They also usually require a minimum number of hours worked per week which can be tough while in school full time, especially nursing school. Many of these benefit programs are designed with adult students in mind who are going to school part time. Research is definitely necessary.

Also, have you checked if your employer offers a scholarship for employees’ dependents?