Just need encouragement

[yooperfamily]

We have been there a couple of times... didn't learn the first time! This is the 3rd time in 10 years we are crawling out of debt and this is the LAST time!!!!

One thing that has helped us was the "Total Money Makeover" book by Dave Ramsey... I don't follow it to a 't', I tried but then made myself feel guilty when I wanted to do something small (like go out to eat, get the kids ice cream, etc...). It has really helped us though! We cut our satellite way down (DH wouldn't agree to get rid of it totally), cut our cell phone plan, asked (& received) lower interest rates on our credit cards, etc!

I also decided I wanted to contribute financially in some way. I wasn't willing to put my kids in daycare, so I looked at other options and considered waitressing in the evenings, working retail, things like that... I don't like to be on someone else's schedule though and I just hate having a 'boss', so I went online looking for a home party type company! Since starting 11 months ago, I have been contributing $300-$1500 a month... since January though it's been over $1000! I can't even begin to explain how much that has helped us!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! My DH was thinking it would be a waste of time and that I may bring in a hundred bucks a month, but said as long as I could bring in at least $300 a month to pay the CC bills, he's be thrilled... so needless to say he's been ecstatic and super thrilled that our cc bills are getting paid off so much quicker!

Also, it's true that you do not have to wait until they are paid off to cut them up! I believe you can also close the account while you still have a balance & just continue to pay on it.

Don't beat yourself up too much, many people have been there... just learn from it and move on! We have finally learned and are NOT going to ever use them again... we can't wait until every single bill is paid off and we'll be a cash only couple from now on!

 

[Talock]

I know this is gonna sound basic, but amazingly it's a mistake a lot of people make: "Don't Use Cash or Debit Cards".

Since you already have a credit card debt, use your CC it as your main source of payment and use your cash to keep making payments on it. As you begin to control your expenses, eventually you'll see the balance starting to come down.

When I met wife, she had 3 maxed credit cards to which she was making payments to, while at the same time using her debit card for all her expenses. Of course the balance on the cards was not coming down at all, since that's what happens when you only pay the minimum balance.

So I got her to:

1. Only keep a $50.00 monthly balance on her payroll account for cash purposes. Nowadays you only basically need cash for taxis, tips and treats. Even McDonald's accepts CCs.
2. Use her ATM card only to access those $50.00
3. Use the rest of her money to start making larger payments on her CCs. She had more than 1, so we started with the one with the lowest balance, and cancelled it in a couple on months.
4. Not incur in unnecessary expenses.
5. Use her CCs for the necessary expenses.

As a result, in a year or so she was able to pay off all of her credit cards. As per my advise she only kept two, one of which she eventually cancelled for bad service. With time, her Credit Rating was actually better that mine, which only changed when we got married and started sharing my cards.

I hope this helps and you do get outta debt.

Best of luck!

 

[budbeerlady]

Hang in there! You won't get any judgments from me.

Haven't had cable for four years -- don't miss it. We use the library and Netflix for videos. (Yes, Netflix costs, but it is much less expensive than cable -- and we can get all the obscure British TV shows we like.)

We switched to prepaid cellphones and have never looked back. We save about $500 a year over our former plan, because I only use mine when I'm out of town on a business trip.

Another thing we did that might work for you is switched to a higher deductible for both our car and home insurance. That way, you're still covered in case of an accident, but you can save a few hundred dollars a year.

Craigslist, consignment (for both selling and buying my son's clothes), and ebay all help a little. We tried a garage sale last summer and didn't make much, but every little bit helps. I think it depends on the kinds of stuff you have for sale -- our neighbors had one last weekend and made over $500.

Please hang in there! There are lots of us toughing out this economy. You aren't alone.

We just increased our deductables, dropped a few things I didnt have to have on there. It saved us a bit.

We cut out cable years ago, right now if it isnt food, shelter, etc it can be hacked off.

Good luck and

 

[Brancaneve]

$15K is a lot of money but there are so many people out there who owe double, triple on CCs. All the cuts you have made(cell phones, etc) make a huge difference in the long run. I always multiply the monthly payment by 12.

"Oh, $20 a month isn't bad. Well, it's actually $240!" You could do a lot with that!

 

[stazmatic]

No flames - I am right there with you!

I second the posters who suggested Dave Ramsey. I also recommend "Your Money of Your Life" by Joe Dominguez and Vicki Robin. Use your library and get them for free.

I can't agree with the theories to continue to use your credit cards. JMO I feel it is easier to spend more when you use credit or debit cards. Cash is king!

Try CVS'ing or Walgreens rewards. Not sure if you have kids, but this helps save money on everything from shampoo to diapers. It takes time, but everything you need to know is online. There is a CVS thread on the Budget Board and there is great information on www.hotcouponworld.com or www.afullcup.com that will help.

Try to consolidate trips to any stores. I know for me I can drop $100 at Target before I even know what's happening. I try to stay out of there now as much as possible. Ditto for the mall and Sam's Club.

My big weakness was eating out. I have been trying to plan meals in advance to eliminate the 4 o'clock its hungry and I have no energy to cook. Even convenience foods that I heat up is cheaper than the drive-thru. But I am making more from scratch, using coupons, and buying generic when its cheaper.

I keep the thermostat high 82 or low 63 depending on the season. I line-dry all my clothes since the dryer broke which saves about $60 month. Even though I have had the money to pay to fix it I haven't bothered.

So far, I have not taken an extra job, but I am not ruling it out. I consider my full-time job to be saving money any way I can.

I would also recommend cutting your credit cards, but not closing them. If your cc companies know you will not be using your cards anymore they have no incentive to lower your rate to keep you as a customer.

Good Luck - I know you will get through it!

 

[threecrazykids]

Thank you so much everyone for your encouraging words. I have written down all the ideas listed and I'm going to look into each one.

If it were completely up to me I really would like to cut everything to the bones, but like another poster mentioned, we can't even get an antenna signal where we are.
Not that it's CRITICAL, but I kind of want to keep the basic cable as we've forgone the summer babysitter and are having our 14 year old stay home with his little brother and sister (10,8). When he's in baseball my Grandma has agreed to pick him up and take him to practice and keep the little ones while he's there. She lives just up the road and we have 3 neighbors who are also home all summer and have agreed to keep an eye on them as well.
I think keeping the cable may be the only thing we end up keeping though...just for the kids sanity.

I am definitely going to call the credit card companies and do what I can to get our interest lowered. We don't have bad credit really, it's still in the 700's. Does anyone have suggestions on what to say to them? I've never called to try to get anything lowered...how do I start the phone call negotiations?

Needless to say, refinancing isn't an option...we've already done that and racked the cards back up. STUPID.

I swear...NEVER AGAIN. Once we get out of this I am never picking up a credit card EVER again.

And Craigslist...HERE I COME! Anything and everything is up for sale. Hmmm...speaking of those kids. LOL JUST KIDDING!

 

[mjantz]

AFA a second job, look into babysitting. Put out the word to family & friends that you're available for babysitting. Check into churches & see if they need nursery staff. You may not make a ton but it will help.

 

[Juliet25]

No flames from me; I could have written your post.

I'm in the process of getting stuff ready to sell on eBay in August. Kids clothes do well for me at back-to-school time, so I'm hoping to throw a big chunk of change at the cc.

I'm with you...I don't know what else I can cut from the budget. We could cut our land line phone, but with two kids in the house I'm worried that in case of an emergency we wouldn't be able to contact the police or fire department from our cell. Other than that, I'm out of ideas.

 

[minnie1928]

If you would like some rock solid, down to the numbers advice I would recommend posting your income, expenses, assets and debts on one of the forums over at www.savingadvice.com. They have a debt forum that is frequented by posters that will give you some really good financial advice. Flaming over there is very rare and it's almost like having your own personal counselor.

Not that I don't like the Dis...I just don't think this is the type of place to get into the nitty gritty details.

 

[englishteacha]

Hi! We took the Dave Ramsey "class", Financial Peace University. We learned a lot. We paid of DH's student loans and our CC (about $18K between the two) in about a year. DH is self-employed, so having a "good year" helped with that, but taking on a second job, even a few hours a week, as well as cutting back can do the same thing.

How much is "basic" cable? If you keep the internet, maybe you could watch favorite shows online, and get Netflix? Could you cut out the internet? (I know it would be painful) Hang dry laundry (make a clothesline inside if you need to!), eat lots of pasta and beans because they're cheap, cut out beverages (water and milk are all you need. Kool-aid is cheap if you want a treat! )

We have Tracfones and they're just fine for us. We only use it on the road or if I need to make a quick call from work. I got a double-minute for life phone, so every airtime card I add gives me double the face value, and I usually find a promotion code to get even more time. Just plan on using your home phone for most calls, and tell your frequent callers to call you at home, because incoming calls cost minutes as well as outgoing.

 

[Boston Tea Party]

Haven't had cable for four years -- don't miss it. We use the library and Netflix for videos. (Yes, Netflix costs, but it is much less expensive than cable -- and we can get all the obscure British TV shows we like.)

We do the same.

 

[C.Ann]

Just wanted to pop in and wish you the best of luck..

Lots of great suggestions here - and I'm sure that more will be added..

 

[dvcgirl]

I am just needing to vent...we are on the verge of having to sell our house because we've made so many stupid financial moves. So FLAME AWAY because once that is all done I need advise on what the hell to do.

We have at least 15k in credit card debt and are literally buried.

I sat down probably 2 months ago and calc'd up our income versus our bills and we have less than $100.00 a month. That's just SUPER! So anything that comes up that isn't planned ended up going on a freaking card.

I am so p***ed at ourselves I could just spit.

I went through and lowered what I could for bills (dropped down to the basic cable plan, combined internet, phone, etc). I am seriously considering dropping our cell phones, I never use it anyway...maybe just get a prepaid phone for all of us to use.

I just don't know how any of these piddly little bills being lowered really makes a difference in the big scheme of things...ya know?

If it wasn't for the $500+ dollars a month credit card payments we would be just fine but I just am at my ropes end.

Is the only option we have at this point to generate additional monthly income? Hubby or myself getting a second job...then what if that income moves us into the next tax bracket? UGH...I just have a million questions and no idea where to start.



I plan on selling every possible thing we can to generate some cash to get those stupid credit cards paid off. And so help me God once they are paid I'm cutting them up for good.

Thanks guys for listening and I know I need a good butt chewing for this, this isn't the first time I've been in this boat.

Did you guys have a drop in income or did this just creep up on you over time? Because, in all honesty, unless you're discretionary spending is out of control, it sounds like your budget is really tight to begin with. It sounds like your going into a tail-spin over $500 a month in monthly CC payments, and to me that's a bit off.

Sounds to me that you may have been living with too little income for quite awhile, and that's really your problem here. You stated in another post that you've already done the re-fi thing and ran the cards back up again. Don't beat yourself up on that point....nearly two-thirds of all people who roll CC debt into the mortgage do the same thing.

But what really sticks out to me is that you don't seem to be spending extravagantly....you're freaking out over 15K of CC debt and a $500 monthly payment....which isn't all that catastrophic. So, it seems to me that you've got to figure out a way to increase your income.

Can either of you pick up a part-time job, or both of you? I mean, we're talking about $500 a month....$125 a week. There are a million little jobs you can pick up in the short term to help keep you in your home and pay off that CC debt.

It sounds like you're cutting just about everything you possibly can and are on top of the spending side of things, and all of that is great. But I think your real issue may be on the income side and I'd do whatever it takes in the short term to increase that to keep a possible foreclosure at an arm's length.

 

[PrincessKitty1]

I vote part-time job. Just an idea...a friend of mine worked her way through college in the 70s running her own office-cleaning business at night.

You could also hire yourself out to clean one house a week. Check out the rates people are getting locally. Most people around here charge around $15 an hour but my neighbor hires an RN to clean at $25 and hour and people pay it! He must be a great cleaner!

The nice thing about working for yourself is your time would be flexible--you could work one day every weekend or even every other weekend.

Even if the extra $$ you makes moves you into another tax bracket, you will still be taking home more $$. I had a recent raise of about $90 biweekly and I only see half of that but you have to look at it as--I'm still making more!

I think dropping your cell phone and using a prepaid phone would be a great idea.

 

[threecrazykids]

Did you guys have a drop in income or did this just creep up on you over time? Because, in all honesty, unless you're discretionary spending is out of control, it sounds like your budget is really tight to begin with. It sounds like your going into a tail-spin over $500 a month in monthly CC payments, and to me that's a bit off.

Sounds to me that you may have been living with too little income for quite awhile, and that's really your problem here. You stated in another post that you've already done the re-fi thing and ran the cards back up again. Don't beat yourself up on that point....nearly two-thirds of all people who roll CC debt into the mortgage do the same thing.

But what really sticks out to me is that you don't seem to be spending extravagantly....you're freaking out over 15K of CC debt and a $500 monthly payment....which isn't all that catastrophic. So, it seems to me that you've got to figure out a way to increase your income.

Can either of you pick up a part-time job, or both of you? I mean, we're talking about $500 a month....$125 a week. There are a million little jobs you can pick up in the short term to help keep you in your home and pay off that CC debt.

It sounds like you're cutting just about everything you possibly can and are on top of the spending side of things, and all of that is great. But I think your real issue may be on the income side and I'd do whatever it takes in the short term to increase that to keep a possible foreclosure at an arm's length.

Basically it took us less than 5 years to rack the debt right back up. I wish I could post my excel spreadsheet so everyone can see exactly where I'm at.
Some months it looks like we're going to have lots of excess (with school being out no lunches) but then other months we literally have $100 left in the "savings" part of the spreadsheet at the end of the month.

How can I post a spreadsheet so everyone can help?

 

[threecrazykids]

I vote part-time job. Just an idea...a friend of mine worked her way through college in the 70s running her own office-cleaning business at night.

You could also hire yourself out to clean one house a week. Check out the rates people are getting locally. Most people around here charge around $15 an hour but my neighbor hires an RN to clean at $25 and hour and people pay it! He must be a great cleaner!

The nice thing about working for yourself is your time would be flexible--you could work one day every weekend or even every other weekend.

Even if the extra $$ you makes moves you into another tax bracket, you will still be taking home more $$. I had a recent raise of about $90 biweekly and I only see half of that but you have to look at it as--I'm still making more!

I think dropping your cell phone and using a prepaid phone would be a great idea.

I am seriously considering doing cleaning of some sort. I love to clean...it actually relaxes me and I just put my ipod on and get at it. I have no idea how to get started with zero references other than coming through my house to see how clean it is!

I also considered babysitting in the evenings for anyone who works second shift.

 

[PrincessKitty1]

I am seriously considering doing cleaning of some sort. I love to clean...it actually relaxes me and I just put my ipod on and get at it. I have no idea how to get started with zero references other than coming through my house to see how clean it is!

I also considered babysitting in the evenings for anyone who works second shift.

You could put an ad in Craigslist. That's how we hired our pet sitter! She's a college student, and her only reference was an out-of-town vets office she worked in briefly. I thought DH was somewhat insane for wanting to interview somebody from Craigslist , but he said she sounded great on the phone. We had an outstanding interview with her and she wasn't the least bit fazed by our dog, who barked hysterically at her. We hired her on the spot (she's been pet sitting for us about 2 years and is still great!)

The daughter of a co-worker of mine cleans houses, and she asks potential clients to make up a list of what they want done every visit (very important because she wants to make sure she doesn't, for instance, skip vacuuming somebody's miniblinds when it's something they expect to have done), then she goes over to the house and eyeballs the list, the size of the house, then gives her price.

 

[dvcgirl]

Basically it took us less than 5 years to rack the debt right back up. I wish I could post my excel spreadsheet so everyone can see exactly where I'm at.
Some months it looks like we're going to have lots of excess (with school being out no lunches) but then other months we literally have $100 left in the "savings" part of the spreadsheet at the end of the month.

How can I post a spreadsheet so everyone can help?

Well, most people who roll CC debt into a re-fi typically charge the debt back up in two years or less, so you're not as bad as that. Still, this means that you've had many years of over-spending. And so you have to take an honest assessment of that and see where the problem is. If you don't think that you're living a lavish life then you probably aren't making enough money.

How much is your house payment including taxes and insurance? What percentage is that payment of your take-home pay? Sometimes people find themselves in trouble because they bought too much house and they end up being "house poor".

Also, did you mention whether or not you have car payments? If so, that could be an answer for you too....that you're carrying too much in auto debt.



A

 

[YoTony2]

First HUGS!

You are not alone!

For the first time ever, DW and I have had to make a budget and stick to it. It has been eye-opening and disheartening. When money was good we used it, but never planned or controlled it. Now that this Depression/Recession has directly hit us were cutting hard and everywhere.

1) No Dinners out unless we stick to the budget for the month.
2) A/C only when absolutely necessary
3) Compact Fluorescents wherever they will fit.
4) Hot Water on Timer
5) Washing cold-cold or warm-cold only
6) Had to stop prepayments on 1st & 2nd Mortgage as well a Commercial Mortgage.
7) Cut Satellite to minimal program (for kids)
8) Dropped Landlines completely
9) Bargain Cell Phone Plan
10) Daughter about to drive (20 year old Camry 34MPG) for Dad, DD gets Dad's 7 year old GMC.
11) Let go lanscappers at home and office, Dad's cutting the laws on weekends.
12) Just found out about Aldi's.
13) Summer camp for DD9 only, DS13 & DD16 will be working (for us) this summer.
14) Gift purchases on hold. Hand made cards and gifts for now.
15) Looking into time of day electricity plan (for home)
16) No longer carry credit cards, if I don't have enough cash I don't need it. (Obviously used for emergency repairs, etc.
17) Any and all extra money pays down highest interest rate credit card, all cards get 20% more than minimum to reduce them faster.
18) I'm gonna learn to do the home repairs, maintenance and exterior work. (YEAH!!! Yes that is sarcastic!)
19) Looking for part-time work as well.
20) Brown bagging to work and school.
21) Pasta 2 -3 times a week. A nice baked Zitti, a thin spagehtti with hot sausage and sauce, and I'm not sure whatelse, perhnaps a caserole?
22) Big Break, just paid off the last car!

College starts in 3 years Don't know what we'll be able to do... .

But, OP hope these are some new ideas, and that others will post their's

-YoTony2

 

[dvcgirl]

First HUGS!

You are not alone!

For the first time ever, DW and I have had to make a budget and stick to it. It has been eye-opening and disheartening. When money was good we used it, but never planned or controlled it. Now that this Depression/Recession has directly hit us were cutting hard and everywhere.


-YoTony2

I applaud you for your efforts. It always strikes me though when folks say that they "recently sat down and did a budget for the first time". I don't know how anyone can effectively control their financial picture without a budget. I actually *enjoy* setting our budget each year (strange, I know).

Also, setting a monthly budget really isn't just something that you do only when things are tight, or when one is experiencing financial difficulty. Once you're out of debt, you'll need to keep the budget in tact in order to meet your savings goals. We haven't had any debt at all in many years, we save over half of our net income, but to this day I still track every single expense. It just keeps us honest.

We set our monthly budget each January. First come the savings goals, then we lay out our monthly expenses (bills), and then we take the amount that is left and decide how we'll spend it that year (house purchases, vacations, save up for some large purchase....etc.). Once that is set, the only day to day expenses I have to track are grocery and discretionary spending. As long as we stay within the agreed upon amount for those two categories, the rest simply falls into place.