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Topic : Debt

Number of Replies: 754
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Created on : Thursday, July 07, 2005, 09:21:14 am
Author : dataimport
Are you struggling with debt? Have you successfully managed your debt? Share tips and strategies with others.

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October 10, 2008, 9:01 am CDT

paying ahead

I caught the tail-end of a show the other day when Dr. Phil was talking about living within your means and "paying ahead".  What is this concept of "paying ahead" ?
thanks
Linda
 
October 10, 2008, 9:20 am CDT

RE: Paying Ahead

Quote From: hanleylin

I caught the tail-end of a show the other day when Dr. Phil was talking about living within your means and "paying ahead".  What is this concept of "paying ahead" ?
thanks
Linda

Please look at the Show Page for more information from the show. http://drphil.com/shows/show/1144/

 

There are often links that will answer your questions there.

 

Dr.PhilBoard2

 
October 23, 2008, 4:15 pm CDT

Need help fast!!

My company just offered its full time employee's a buy out to basically quit their jobs.  I'm seriously thinking about it but need some advice.  They gave us until next Friday to decide if we are taking it or not.  Here are the basics:

 

Buy out consists of:
lump sum payment of 2 weeks pay for every year you worked there (10 yrs)

lump sum payment for the cost of cobra insurance for the lenght of buy out (which is 10yrs in my case)

longevity bonus (800.00)

100% payout of personal time off

they say they will not dispute any claims for unemployment BUT will the state agree to unemployment because it would be quitting

 

If they dont get enough people to take this, they will layoff; thing is no one knows who they will layoff,(non union) what dept they will lay off, (15 different depts) if they will do it by seniorty ...so you could NOT take this and then get layed off anyway with nothing....

 

I would be able to pay off all my bills except my mortgage and a Line of credit (I know, I know LOC was a bad idea).  I would be able to go back to school (if I can get unemployment).  Any advise????

 
October 25, 2008, 7:28 am CDT

Need help fast!!

Need help fast!!

My company just offered its full time employee's a buy out to basically quit their jobs.  I'm seriously thinking about it but need some advice.  They gave us until next Friday to decide if we are taking it or not.  Here are the basics:

 

Buy out consists of:
lump sum payment of 2 weeks pay for every year you worked there (10 yrs)

lump sum payment for the cost of cobra insurance for the lenght of buy out (which is 10yrs in my case)

longevity bonus (800.00)

100% payout of personal time off

they say they will not dispute any claims for unemployment BUT will the state agree to unemployment because it would be quitting

 

If they dont get enough people to take this, they will layoff; thing is no one knows who they will layoff,(non union) what dept they will lay off, (15 different depts) if they will do it by seniorty ...so you could NOT take this and then get layed off anyway with nothing....

 

I would be able to pay off all my bills except my mortgage and a Line of credit (I know, I know LOC was a bad idea).  I would be able to go back to school (if I can get unemployment).  Any advice????

 
October 27, 2008, 3:46 pm CDT

anyone out there?

doesnt anyone have ANY suggestions for me?  :(   RE: need help fast
 
October 27, 2008, 6:57 pm CDT

Debt

Quote From: rastraus

doesnt anyone have ANY suggestions for me?  :(   RE: need help fast

 

I'm sorry that no one has given you any suggestions.   I see that you have a deadline fast approaching. 

 

My suggestion would be to see an independant financial advisor ASAP....you will have to pay an hourly fee, but you don't want to get advice from anyone that is trying to sell you something. 

 

I just Googled "buyouts or layoffs" and I suggest that you do the same.  Do the math as well. How much will you receive?  How do you plan to invest this money? What will health insurance cost?  What is the job opening situation in your area for your type of position?  Are there other types of jobs that you are wiling to take? 

 

I wish I could be more helpful......good luck to you.

 

 

 
October 27, 2008, 10:22 pm CDT

Here is my advice

Quote From: rastraus

My company just offered its full time employee's a buy out to basically quit their jobs.  I'm seriously thinking about it but need some advice.  They gave us until next Friday to decide if we are taking it or not.  Here are the basics:

 

Buy out consists of:
lump sum payment of 2 weeks pay for every year you worked there (10 yrs)

lump sum payment for the cost of cobra insurance for the lenght of buy out (which is 10yrs in my case)

longevity bonus (800.00)

100% payout of personal time off

they say they will not dispute any claims for unemployment BUT will the state agree to unemployment because it would be quitting

 

If they dont get enough people to take this, they will layoff; thing is no one knows who they will layoff,(non union) what dept they will lay off, (15 different depts) if they will do it by seniorty ...so you could NOT take this and then get layed off anyway with nothing....

 

I would be able to pay off all my bills except my mortgage and a Line of credit (I know, I know LOC was a bad idea).  I would be able to go back to school (if I can get unemployment).  Any advise????

RASTRAUS........I see that you are in the Detroit area which probably means you are connected to the Auto industry in some way. Your area has very high unemployment so finding a new job would be difficult. I would probably take the buy-out because you could wind up getting laid off with nothing.

 

As for what you would do with the money to pay off all your bills......sounds great.......but do you have an emergency fund in savings equal to 6 months wages? Do you have ANY money to use for cash flow? It sounds like you were even going to use the lump sum you would get for Cobra to help pay off the bills. BAD idea!! Pay for the Cobra.....your family deserves that.

 

MY ADVICE.......Take the buy-out, place the money in a Money Market Account paying the highest interest you can find. You would probably be laid off within a month or so anyway. File for unemployment, if they don't contest.......you may get it......I have even though I quit and that was in Michigan. This is a time for SURVIVAL MODE. Look at all your options and try to make the smartest decisions you can. Protect the home and family at all cost. IF you pay off all your bills.....you would owe less but then be cash strapped and who knows how bad or how long these hard times will last. If you pay anything off.....pay the credit cards off......their interest rates are too high. Ahhhhh yes, don't we all wish we had done better in school? While your idea is commendable......this is not the time to go back to school. You need to find another JOB. You have 10 years experience at something.....and I think you will find that there are not too many jobs out there. I also know the Real Estate market in your area sucks......you probably could not sell your home for what you owe on it. PROTECT IT until times get better. DO NOT.....I repeat.....DO NOT use credit cards or your LOC to live on!!! You would just be digging a deeper hole for yourself. GOOD LUCK!!!

 
October 28, 2008, 4:07 am CDT

THANK YOU!

Yea I only have until Friday and I really appreciate the advice from all of you .. thanks very much...I may have mispoke myself about the cobra payout, I was taking just because my husband has insurance that we can jump on so we are good there.  I am surprised to hear the suggestion about not going to school...I guess that is the main reason I was going to do this,, but that is something to think about also.  The credit cards are the first thing that are getting paid off for sure!! , after those I just have a truck payment.  They say they will not contest the unemployment BUT the state of Michigan might.  If that is the case the worse thing that can happen is that I would have to wait for six weeks.  I can always wait to pay off the bills until then.  I calculated that the unemployment would equal out to a $9.00 an hour job so I would have to get at least that if I do get a job. And no I have absolutely ZERO savings!!

 

 So taking into consideration the advice you all have given me I think I can make a good decision for my family and me.  I agree strongly about the "survival mode".  Things sure are going down hill fast and I would feel alot better knowing I COULD survive on a minimum wage job if I had to as far as my debt goes.

 
November 9, 2008, 9:30 am CST

Son and wife asking me for advice What do I say?

Hi, My name is Kasey and my son and his wife recently approached me with what for me is unanswerable.  In 2002 they borrowed about $20,000 from her grandmother to pay off oustanding debt most of which had been incurred by my daughter in law before my son met her. They were asked at that time to sign a promissory note, agreeing to pay it back in 2 years. Completely beyond their means of course. They signed the same note again in 2004 for another two years.  They were not asked to sign again in 2006.  My daughter in law says grandma stated she just needed the note for peace of mind and that she hoped eventually they would be able to afford to pay on it.  Grandma passed away in early 2007. About 3 months after her death, my daughter in laws cousin who is executor of the estate called her and stated he had found the note and did not know whether it would be called in as an asset.  Then not another word on the subject. Last week, after almost 20 months she received a letter via registered mail from her cousin saying it is being called to probate as an asset to the estate and they have 60 days to respond. How should they respond? They are no way in a financial situation with the current economy to pay this debt. Their credit rating is poor, they owe too much on their house to get a loan against it and they frankly could not afford another payment anyway. My son's place of employment just cut back hours dramatically and the only job she has been able to get is working in a school cafeteria, so when there is no school, there is no paycheck. I know this is a debt of their own making I am not looking for sympathy for them, I am looking for advice as how they can weather this. There are 2 small children involved in this and that is where my concern lies. I do not want to see my grandchildren put through any more hardship than they have to.
 
November 10, 2008, 9:05 pm CST

TELL YOUR KIDS TO LIVE WITHIN THEIR MEANS

Quote From: kaseyjcf194

Hi, My name is Kasey and my son and his wife recently approached me with what for me is unanswerable.  In 2002 they borrowed about $20,000 from her grandmother to pay off oustanding debt most of which had been incurred by my daughter in law before my son met her. They were asked at that time to sign a promissory note, agreeing to pay it back in 2 years. Completely beyond their means of course. They signed the same note again in 2004 for another two years.  They were not asked to sign again in 2006.  My daughter in law says grandma stated she just needed the note for peace of mind and that she hoped eventually they would be able to afford to pay on it.  Grandma passed away in early 2007. About 3 months after her death, my daughter in laws cousin who is executor of the estate called her and stated he had found the note and did not know whether it would be called in as an asset.  Then not another word on the subject. Last week, after almost 20 months she received a letter via registered mail from her cousin saying it is being called to probate as an asset to the estate and they have 60 days to respond. How should they respond? They are no way in a financial situation with the current economy to pay this debt. Their credit rating is poor, they owe too much on their house to get a loan against it and they frankly could not afford another payment anyway. My son's place of employment just cut back hours dramatically and the only job she has been able to get is working in a school cafeteria, so when there is no school, there is no paycheck. I know this is a debt of their own making I am not looking for sympathy for them, I am looking for advice as how they can weather this. There are 2 small children involved in this and that is where my concern lies. I do not want to see my grandchildren put through any more hardship than they have to.

KASEY........it would help greatly if you had spent more time giving some details of the Promissory Note and less time defending your son and daughter-in law. Did your kids PAY any of the money back to Grandma? If so.......how much? When they re-signed the Note......did any conditions (interest rate, etc.) change? You said they signed the same Note for another two years......so was it noted in the Note that the "terms" had been extended for two more years? Did they pay ANY money back during those two years. If not.......just admit that they are a couple dead - beats who took advantage of Grandma and now are scared that someone is going to make them PAY-UP!!!

 

Well.......as bad as I hate to tell you.....they will probably be "forgiven" the debt. A Promissory Note is essentially a personal loan......it is clear that your son and DIL were having difficulty paying it back. Grandma even stopped having them "extend" the terms or even have them sign again so it could easily be considered by the Estate as a "Gift" from Grandma. She kept the paper just to show that she DID loan them money but it's also pretty clear that she never tried very hard to collect the debt. Tell the Executor that Grandma had planned to "forgive" the debt and if necessary have your son a DIL show their financial condition and their inability to pay the debt.

 

NOW......as a Mother.......I expect you to sit down with your Son and Daughter - In - Law and give them some lessons on setting up a Budget, and living within their means. Understand this......I have NO sympathy for people who take advantage of elderly.....especially family members who love them and only want to help them. If you don't want to see the Grandchildren put through hardship......be prepared to step up to the plate and see to it that it doesn't happen.

 
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