Oprah's Debt Diet IV

[disneysteve]

I have resorted to the Friday or Saturday (depends on the bank) for the bill due on the Sunday, since I figure Monday really will be too late.

I think you're taking your chances there. I always do my online payments about a week before they are due. In fact, Bank of America won't let you schedule a payment for less than 3 business days out, so if I go on right now to schedule a payment, the earliest available "delivery" date is 3/29. I'd much rather pay a bill a few days early than risk being late. Never really understood the point of waiting until the last minute to pay.

 

[LauraR]

I've made two late payments on my credit cards in the last year or two. That was unusual for me, and both times I called the credit card company (it was the same one both times) and they were willing to waive the late fee of $35. After the second time I set up automatic monthly payment to cover the minumum due on all my credit cards (4). I'm surprised David Bach didn't suggest automatic payments as a way to avoid late payment fees and organize debt payment (or maybe I just missed it). I know he's big on automatically paying into retirement funds (which I do for my IRA, but couldn't do for my husband without him getting a signature guarantee from our bank---annoying).

I also really think Oprah shouldn't have paid for the Bradley's kitchen appliances, as previous posters have said. She should have been given a budget based on a portion of the money she was spending on take-out. Then they should have taught her a little about comparison shopping. She does seem very status conscious, and I think she needs to get over that. Buying her expensive appliances isn't teaching her much.

The Bradleys could also learn to cook together (it ain't rocket science!) I'm a SAHM, but my husband frequently helps make part of the dinner (and sometimes he makes the whole dinner---like last week when I was tired and ready to order out for pizza and he jumped in and made egg and potato burritoes!) It's a nice opportunity to talk about the day, too.

My DH and I watched the show together and we could both relate the most to the third family (the Egglestons). Although, even with them we couldn't see hanging onto some of the Bears season tickets. Definitely a "want" not a "need". But at least both spouses seem to be on the same page on paying down their debt and not squabbling or stewing in resentment.

 

[Lisa loves Pooh]

All of my online banks tell me to make sure that there is a period of @ five days to transfer the money for bills paid online. Give me a break! In this computer world of ours, that transfer should take....um......seconds. I tend to pay on the due date or the day before. I have resorted to the Friday or Saturday (depends on the bank) for the bill due on the Sunday, since I figure Monday really will be too late.

In my case--we allowed the five days. Our bank assumes responsibility if they fail to post it within five days. It was wired to the bank on Day X...they refused to honor it until day Alpha--4 days after the transfer took place on a non-holiday weekend with a due date on Sunday.

 

[Lisa loves Pooh]

I think you're taking your chances there. I always do my online payments about a week before they are due. In fact, Bank of America won't let you schedule a payment for less than 3 business days out, so if I go on right now to schedule a payment, the earliest available "delivery" date is 3/29. I'd much rather pay a bill a few days early than risk being late. Never really understood the point of waiting until the last minute to pay.

But that is the point---with electronic transactions that MY bank promise to transmit within 5 days--why do I have to be ONE week ahead of the due date...and with the 5 day window--that is 12 days early.

We schedule it right away but not until a time we are ready for it to go out--and while you may not understand....try this scenario.

If I borrow a book from the library for 3 weeks and it is due 3 weeks from now, I should not be compelled to bring it one week just in case the computers do not work right--and they cannot log the return. It is silly.

It is the same way with the payment. It is due when it is due. Why we choose to pay on the due date is irrelevant--it is because we can. We are paycheck to paycheck for that type of stuff. We have interest bearing checking--and while a penny or so of interest is minimal...it is a penny we didn't have before.

It is asenine to have to start and ELECTRONIC transaction 12 days ahead of time so they roughly get their payment a week early.

It is a due date not a random number.

 

[gnoles]

One thing bothered me about David Bach's segment. He kept saying how the CCs were charging late fees and over limit fees and he kind of made it sound like that was an evil plot by the CC companies. He never pointed out that if the family would just pay their bills on time and not overcharge, those fees would cease.

I get the phone call of the year last week from a credit card company, the 0% APR is about to expire on my card, would I like to go ahead and pay off my student loan with $9,000 in cash from them? I explained that my student loan rate was HALF of what they would charge when the no APR disappeared in May.

OK, then how about using this money for a well deserved vacation, they could give me $9500. I responded that my vacation was already paid for with my other card with them, the red one with Mickey on it, and that I'd already set the bank draft up to pay it off... immediately (gotta get those reward dollars).

Then it's, is there anything you would want that we could go ahead and send you the check for, incidentals... (blah blah blah, I really quit listening at this point). I don't think she got it when I said, "I am disinclined to acquiesce to your request" (POTC)

Does the credit card company want me to go into debt, YES.

Do they want me over the limits so that fees and interest will accrue at a high rate, YES.

The companies who cried to congress about debt and bankruptcy are promoting the behavior that leads down this slippery slope. At one time, it was hard to obtain a credit card, now it's too easy.


** Just a note on the above... I carry no balances, I do track down the 0% 12 month no APR cards and keep one active, just in case. The only true loans I have would be Car, House and Student. I'm a teacher, as is my wife. We probably don't make $70k together... and I didn't get reimbursed for my Master's Degree.

 

[disneysteve]

But that is the point---with electronic transactions that MY bank promise to transmit within 5 days--why do I have to be ONE week ahead of the due date...and with the 5 day window--that is 12 days early.

It is asenine to have to start and ELECTRONIC transaction 12 days ahead of time so they roughly get their payment a week early.

You misunderstood me. I wasn't suggesting paying 12 days early.

If I have a payment due on Friday, 4/14, for example, I'll probably make the payment through my online banking site on 4/7. The bank says clearly that it takes 3 business days, so I give it an extra day or two just to be safe. So the payment will likely come out of my account on 4/12, the 3rd business day.

I totally agree with you that if the due date is 4/14, that should mean by close of business on 4/14, not at 5 am on 4/14. That policy is ridiculous and there should be regulations against that.

 

[disneysteve]

Does the credit card company want me to go into debt, YES.

Do they want me over the limits so that fees and interest will accrue at a high rate, YES.

Absolutely. Of course they want you to rack up fees and interest. That's where they make most of their money.

The over-limit thing has always bothered me. If someone tries to charge something and it would put them over their limit, the charge should be rejected - period. You shouldn't be allowed to go over your limit. Otherwise, what's the point of having a limit?

I get similar calls but from my mortgage company, not the CC. They call to offer me a home equity loan/line. They just don't seem to understand when I say I don't need or want to borrow any money.

 

[Debbie]

So the payment will likely come out of my account on 4/12, the 3rd business day.

The wording on the bank websites here is that it might take up to 5 days. I suppose that is a CYA in case their computers go down.

I find it interesting that it is out of my account the moment that I set up the payment, unless it is a future dated bill. Literally. If I set up an online transfer, run down to the banking machine to update my account, the money is not there. As an Electronic Funds Transfer, it should work the same as when I use my debit card (Canadian, here, and it is different. ). I set up an EFT, and the store has the money. You are right to say that I have been lucky, though. Like I said, I do try to make sure that the EFT has been done a day or two in advance, noting the reference number right into Quicken.

And why do I pay when it is due? Because that is when it is due. Every day in my account is $$ for me! And those tenth of a cent interest pennies add up.

One thing that I got confused about, was the interest rates on the "cash your cheque today" places that was mentions 400+ % interest? Never having used them, I don't know enough about that. I know that some of the parents of the kids I teach, though, have. Could someone explain the figures that the inancial advisor was using?

 

[kaddjr]

Okay folks, let's not kid ourselves here. I'm sure Oprah didn't give Lisa that stuff- the manufacturers did. It's called cheap advertisement! Yes, they are expensive items, but even at retail cost, it's a lot less expensive than a 30 second commercial during her show AND it's the very audience they want to reach. They want you to see it, like it, and go buy it. Just like the "Favorite Things" shows. Kinda contradicts the message of this series, dontcha think?

That aside, I think Lisa should have been made to work that stuff in the budget and go buy it herself. This is only mho (and some may not agree with me) but I think the woman is lazy. I don't think this family will make enough changes to get out of their situation. I think they are too far gone.

The family with the teens MAY have a chance, but I still have my doubts. Are the parents still paying for the girl's car? If they are, they need to stop that right now. The money the girl makes from her job should be going to her carpayment. She certaintly doesn't need more clothes! If the girl would get off her butt and do her laundry, she would probably find that she only needs about half of what she has! That goes for both girls. The mother said she took bags of clothes to Goodwill and many of the items had tags on them still. If you need money, don't do that. Hold a garage sale or ebay the stuff (I know the garage sale thing didn't go over very well the first time it was brought up), then take the leftovers to Goodwill. You won't get what you paid for the stuff originally (in most cases), but something is better than nothing when you need money. Same goes for the mother's scrap stuff. Now will say that the father and daughter did very well on the grocery shopping trip, so a positive there.

I think the Egglestons have the best chance of succeeding, although I do agree with the other poster that said to get rid of the Bears tickets. That's definetly not a need. Just a side note with this family- when they were telling their friends and family about their situation, did anyone wonder how many people in that crowd were in the same boat?

There was another point David Bach forgot to point out. On every major cc I have, there is a clause in the agreement that states they (cc company) will periodically check your credit and if they find you have made a late payment to another creditor, they will raise your interest rate.

Did anyone see the previews for the next show? Lisa is driving a SUV off a car lot. Wonder what that's all about?

 

[dcfromva]

I think you're taking your chances there. I always do my online payments about a week before they are due. In fact, Bank of America won't let you schedule a payment for less than 3 business days out, so if I go on right now to schedule a payment, the earliest available "delivery" date is 3/29. I'd much rather pay a bill a few days early than risk being late. Never really understood the point of waiting until the last minute to pay.

steve,
I seriously don't get the 3 business day thing, either--it is supposed to be electronic, what takes 3 days (do they have little virtual accountant agent software racing around making book entries in the computer ) ?

I have found that if I schedule the payment from the credit card web page that it counts as a payment on the same day or the next day (depending on the company)--or I can pick a date in the future, if I like.

-DC

 

[dvcgirl]

Okay folks, let's not kid ourselves here. I'm sure Oprah didn't give Lisa that stuff- the manufacturers did. It's called cheap advertisement! Yes, they are expensive items, but even at retail cost, it's a lot less expensive than a 30 second commercial during her show AND it's the very audience they want to reach. They want you to see it, like it, and go buy it. Just like the "Favorite Things" shows. Kinda contradicts the message of this series, dontcha think?

That aside, I think Lisa should have been made to work that stuff in the budget and go buy it herself. This is only mho (and some may not agree with me) but I think the woman is lazy. I don't think this family will make enough changes to get out of their situation. I think they are too far gone.

The family with the teens MAY have a chance, but I still have my doubts. Are the parents still paying for the girl's car? If they are, they need to stop that right now. The money the girl makes from her job should be going to her carpayment. She certaintly doesn't need more clothes! If the girl would get off her butt and do her laundry, she would probably find that she only needs about half of what she has! That goes for both girls. The mother said she took bags of clothes to Goodwill and many of the items had tags on them still. If you need money, don't do that. Hold a garage sale or ebay the stuff (I know the garage sale thing didn't go over very well the first time it was brought up), then take the leftovers to Goodwill. You won't get what you paid for the stuff originally (in most cases), but something is better than nothing when you need money. Same goes for the mother's scrap stuff. Now will say that the father and daughter did very well on the grocery shopping trip, so a positive there.

I think the Egglestons have the best chance of succeeding, although I do agree with the other poster that said to get rid of the Bears tickets. That's definetly not a need. Just a side note with this family- when they were telling their friends and family about their situation, did anyone wonder how many people in that crowd were in the same boat?

There was another point David Bach forgot to point out. On every major cc I have, there is a clause in the agreement that states they (cc company) will periodically check your credit and if they find you have made a late payment to another creditor, they will raise your interest rate.

Did anyone see the previews for the next show? Lisa is driving a SUV off a car lot. Wonder what that's all about?

Yes, I did wonder how many in that crowd at the Eggleston's house were in the same boat. If you believe the statistics, probably a few of them were in the same boat, or at least a similar boat. I also agree that the Eggleston's have a good shot of making it out of debt. The good news for them is that they are teachers, and so there's likely some kind of pension there. Hopefully they'll become savers. Again, if you believe the statistics out there, and I do...58% of all folks 55 and up have saved less than $100,000 towards retirement. It will be tough for the Egglestons to achieve that because they'll be spending years paying down their $43,000 in CC debt. That's the real danger of CC debt...it takes away from your ability to save for tomorrow.

The Bradley clip of her driving the new SUV...I wondered about that too. I still think she's not a real person. The fact that she wouldn't give up the hair thing was a real sign for me that she simply doesn't get it. The 170K in consumer debt...these people will never pull out of that situation....ever.

 

[Jon99]

Assuming, because they have Bears season tickets, that they live in Illinois, their pension will pay them 75% of their highest yearly salary and medical, plus cost of living increases, so their retirement situation should be in good shape..

 

[dvcgirl]

Assuming, because they have Bears season tickets, that they live in Illinois, their pension will pay them 75% of their highest yearly salary and medical, plus cost of living increases, so their retirement situation should be in good shape..

That's right...and so that's not so terrible. They just have to get out of debt, and save what they can to try and get higher than 75%. Of course, many folks could live off of 75% of their income, but these people need to learn that skill.

The Widlunds probably have no pension to speak of. I think maybe Mr. Bradley is a government contractor and so there may be a pension there. However, one iddy biddy pension isn't going to cut it for Mrs Bradley . She's going to be one disappointed elderly woman unless she figures out something that makes her happy other than "stuff".

 

[NMW]

Did anyone catch Oprah today? They had all three couples on there and dealt quite a bit with credit card debt.

The one thing I thought was totally strange was that Lisa Bradley had never gone into a grocery store and used a cart. That just blew my mind.

My mother-in-law doesn't use a cart when she grocery shops either, just a basket. She and my father-in-law have eaten out most nights in the 14 years I have known them. IF she cooks, it's a big deal and she buys what she's going to cook that day. I remember when DH and I were first dating. When you looked in their freezer there was nothing there, I mean NOTHING except ice. It cracked me up. Now that they are retired, they have some lunch itmes and lots of diet soda. Most mornings my father-in-law goes out for the papers and fresh bagels for breakfast. They still eat dinner out every night.

It's funny that DH grew up this way, but loves that I cook (most of the time ). He loves to have a meal at home just us and the kids.

 

[TumFamily]

I am thinkin' if we stick to the debt diet we may NEVER see Disney again!!!

 

[Caradana]

I don't know how this stacks up to other states, but here's how things shake out in NC:

NC pays its teachers the national average -- no more, no less.
Teachers are not required to earn a master's degree, but if they do it raises their pay 10%. Teachers are reimbursed a large percentage of the cost of a master's degree.
Teachers can raise their pay an additional 10% by earning National Board Certification.
The biggest raises come from leaving the classroom and going into administration; however, in my experience, most teachers don't want to do that -- they want to teach, and administration is a completely different job.
A first-year teacher (bachelor's degree only) earns 26,262, and a 30-year veteran teacher (bachelor's degree only) earns 46,590.

Website:
http://www.ncpublicschools.org/salary_admin/salinfo.htm

Wow. Come to New Jersey. I have a close family member in a mid-size district in Somerset County, 12 years of experience, MA + 30 credits = $61,370. Next year, 13 years = $64,440.

 

[disneysteve]

steve,
I seriously don't get the 3 business day thing, either--it is supposed to be electronic, what takes 3 days

I think it is partly to protect themselves for any system downtime. I also know, at least previously, there were still payees that didn't get electronic transfers but the bank actually cut and mailed a check. I'm sure there are still some of those around, though fewer than there used to be.

 

[disneysteve]

Every day in my account is $$ for me! And those tenth of a cent interest pennies add up.

One thing that I got confused about, was the interest rates on the "cash your cheque today" places that was mentions 400+ % interest? Never having used them, I don't know enough about that. I know that some of the parents of the kids I teach, though, have. Could someone explain the figures that the inancial advisor was using?

My checking account doesn't earn interest, so paying bills a few days early doesn't cost me anything.

As for the interest rates on the check places, not much to explain. The APR on those payday loans is outrageous. Same goes for the tax refund anticipation loans that are advertised all the time here in the US this time of year. I started a thread a couple of weeks ago that I passed a place charging 162% interest on those loans. The idea is that people will only hold the loan for a short time, so they don't think about the APR. They only think about the absolute cost - $10 or $20 and that doesn't sound that bad. But when you actually look at the interest rate, it is outrageous.

 

[mickeyfan2]

Something to remember, when you get a "free" item from any manufacturer you will get a 1099 for the item and owe taxes. Say you got a "free" washer and dryer in 2006 that retails for $2000. By early 2007 you will get a 1099 for the $2000. You can lower that amount to what it is really worth (what you could buy it for) and not the retail. Let use say you can reduce it to $1600. You are in the 25% tax bracket, so you owe Uncle Sam $400. Now that is a good deal for the W/D, but what if you are maxed out and cannot pay $400?

 

[Free4Life11]

I wonder what the people on Exteme Home Makeover do?? Some of those homes are multi-million dollars!!