Topic : Debt

I am a 60 year old homemaker. And we are in debt. How we got into debt is a very sad story and a long one so I am not going there right now. Our debt last year was around 25,000 give or take a few dollars It is around 23,000 close to 22,999 as of this month.

I have nothing against credit cards but you have to be educated in them like everything else in life. There are so many people out there that don't even read their statements. They are scared of doing money transfers and they also get stuck when the 0% interest runs out in a worse shape then before. Being smart when it comes to credit cards in an art that everyone should learn.

Closing dates, percentages and how the company figures payments on the accounts are so important.

I have been reading a few of the postings. I saw where one lady was going to pay off one account at a time then go to the next one. For some people this is great.

I do what some call snowflaking. My goal is not only to reduce  the amount of the debt but also the payments. The more your debt goes down the larger the saving. But in many cases if you don't pay the extra money just right the advantages are not that great when it comes to payments.

Snowflaking is when you pay a little on a bill extra. For me that is paying not the lowest balance or the highest balance or the lowest interest or the highest interest but the bill that will gain me the most or reduce the next months payment more.

Example you got a bill that is say 6329.00 and the company charges you 2% of the balance. So your payment is 126.00 Say the interest is 2.9 which is around 20.00 a month. So before the  month's closing date  you pay that 20.00 and 30.00 extra. The whole 126.00 comes off the balance With the 50.00 extra your balance is now around 6153.00 2x61 is 122.00 that month. A saving of 4.00 on that months bill. You want the balance to go down into the next 100.00. Do this with every bill that is close to the 100.00 mark and in no time the monthly payments will go down by 10.00 or more. The more the payments go down the more extra money you have. If you do this on one bill that is great. But across he board closes to that 100.00 mark you will notice more saving and a bigger return.

We are on a very low fixed income. I get my snowflake money by cutting out little things. Like another woman said buy cokes by the case when they are on sale if you work and take the coke to work for your lunch instead of buying from a machine. That in it self could save you at least 5.00 a week or more. Candy or nuts for a break take them from home. Saves more.Cut back on household bills, cut out call waiting and caller ID, cut a few channels on your cable, cut out the newspaper except for the Sunday paper. Use coupons on double coupon day at the grocery store. There are ton of little things you can do.

I am big on Bill Pay. Since most of our living money is in a checking account. When I have a few bucks left at the end of the week I just click a couple of buttons and send it to bill pay. There has been times when I have gotten a bill that had 5 little payments on it listed. If I had tried to do something big, I would have never done anything but I can always find a 4.00 or 5.00 somewhere. 4.00  time 4 is 16.00 extra a month on a bill.

There are little ways out there to make some money. Do surveys on the web. Get a checking account that pays interest on your daily balance.  Get credit cards that will pay you cash back not points but cash. Use all this money to snowflake into your bills.

One pit fall that many fall into is 0 % interest.  When you do a 0% never transfer more then you can pay in the time period. And always when you are counting off the months count one less. So many of these banks do not tell you that it is the closing date of  the month before the date the interest runs out that they start charging you interest.

Know your closing dates, not many people do. What you pay on a bill must be in before  the closing date of the bill to be counted for interest reason. Be mind full if they charge you interest on the daily balance and not the real balance Check your statement it is there. The amount you are being charged interest on should always be what is stated on the top of the statement. I had paid a balance 2,000 recently had only 125.00 remaining on the bill but because of the daily balance thing they charged me interest on 1500.00 not good.

None of us like being in debt. But life happens and many times we have no choice How we get out of the debt is totally up to us.

I know this has been long  I also hope this has helped at least one person out there.

Hugs

Kymaiden

ALIEN LIFEFORM.......do you consider yourself an Alien among most others?? At any rate, I too would fall into the "weird" column as you have described it. However, I was much older and had done "STUPID" more times than you before the "light bulb" came on. Actually I was 37 when I realized money could really be "managed" to my advantage. I taught myself about managing my money and how to make it work FOR me rather than against me. I am now retired, out of debt, and have enough money to remain that way. I have protections in place to see to it that my money outlives me, even though my Government keeps asking me for more in the form of taxes. Wow, I'm 69 and they still want taxes......it isn't enough that I paid taxes for more than 45 working years!!!

 

Like you, it amazes me that very educated people get into debt so deeply. They only come to places like this Message Board when they are desperate and then rarely accept advice when given. The number of people who abuse Credit Cards is staggering. I have told many, "If you play with snakes you are going to get bitten."........doesn't seem to have any impact.......I saw a News article that reported many people will skip their mortgage payment in order to pay a Credit Card payment. No wonder there are so many foreclosures!!!! You spoke about helping family members and I too have done the same......but not anymore. I now only help those who are trying to help themselves. (Family never appreciated what I did so I stopped.)

 

SO........does this mean that because we are debt free, think before we spend, manage our money, have an emergency fund and financial security that we are WEIRD???

 

I CAN ACCEPT THAT.......CALL ME WEIRD.....BUT I SLEEP LIKE A BABY!!!!!

You mentioned people skipping mortgage payments to pay credit cards (or for some people it's rent) I never ever could understand that mentality. I've actually worked with a couple of people in the shelter i volunteer at that were homeless for this reason! I know those CC companies (and collections agents) can lay it on thick and be really scary but people need to get educated about  the Fair Credit Act and the laws in their state. It's amazing what some of these companies will try to pull.

 We're still working on paying off some sm. debts so, I know it can be a struggle. I just urge anyone who's having financial difficulties to get educated and make these companies play fair.

CADDYGUY
To cut a long story short, I've felt a profound sense of not belonging, of feeling different, all my life hence my use of the Alien tag. I frequently do things and think in a way contrary to what typical "earthlings" do. Behaviours must make sense to me. I try to do what works instead of blindly doing what generations of white sheep earthlings have unquestioningly done. I know I'm in a minority group for all sorts of reasons and my financial priorities certainly are out of the ordinary (weird).
Congratulations on being successfully weird also.
I can identify with your attitude to relatives who never appreciated your financial assistance.
There is a social stigma that attaches to anybody who is tight with money, think miser or scrooge......have you noticed?
A majority of earthlings screw their finances into the ground to varying degrees and deep down they know they are screwing up but don't want to blame themselves.
Everybody wants to feel good about who they are and how they live so it's easy to rationalise that people who spend without thinking are not irresponsible, just "spontaneous"  (read good people)
Conversely a person who is tight with money is viewed as the scrooge, the miser, mean, miserable and selfish.  ( read bad people)
Like yourself I would like to help anybody who genuinely wants to change their financial ways but do you think such people exist?
I've thought lots of times I'd like to be appointed money manager for somebody with bad debts but I guarantee the first time I went shopping with them I would not survive the trip. I would be slamming the brakes on their spending, denying them their luxuries and they would shoot me on the spot.
My girlfriend is a "comfort and convenience person" and her finances are in a mess, always have been.
I do try, as diplomatically as I can to "educate her" but I confess I'm getting nowhere. (sigh)
She tries to hide it but I know she detests my attitude to money whilst simultaneously trying to tell herself that good people spend, spend spend..........

Ugh. I'm going to go nuts if I don't find a way to fix this.

I'm a student about to go into the next semester at my local jr. college, and I've got some problem's with money that are about to make me scream.

I only just started my job about a month and a half ago, and I haven't really had the chance to save up a whole lot of paychecks yet. Unfortunately, my car engine just blew itself to hell and it would cost me more to fix it than it would to just buy a new car. Looking on Craig's List, that's going to cost me about $1200, because I can't afford anything higher than that. I absolutely need to get a car right now, because otherwise I can't get to school without it. I could take my bike to work, but I will need the car to get to class.
I owe my mom $50 a month to pay for car insurance and cell phone, and I also owe my boyfriend about $150 for some money he gave me earlier this year.
Since the new semester is about to start, I have to pay for classes. That is going to cost me about $98. That's not including the cost of whatever books I may need for each class.

I've been trying since last year to save enough money to move out, but when I got laid off, that put a major kink in things and basically set me back this far.

Since my job just started a short while ago, I have about $375 in my bank account. However,
with all this added up, I have to come up with about $1,398 basically out of my ass. I don't know what to do. I'm feeling the pangs of money shortage panick come up on me. I really don't know what to do anymore. Every time I pay off something, and I start to feel like I'm in control again, something else pops up. Like this situation with my car. I was feeling pretty good about my financial situation...until that hissing sound started coming from my engine....I swear...every time I see the light at the end of the tunnel, it just starts to stretch itself out even longer.

 I don't have any "magical" solutions for you but some admittedly old fashioned ideas and thoughts that could help you.
I'm encouraged that you have saved some money in your bank account in the past which tells me you do believe in saving but you owe money to your mom and boyfriend,,,,,,,,,,,,,
The number one WORST thing anybody  can do if they are in a fragile financial position (thats you) is BORROW ............
Aim to be debt free where humanly possible, borrow as a last resort and only when you are CERTAIN you can repay the debt without taking risks or gambling good luck will always shine on you (it won't).
Save for whatever it is you need/want and go without it until you can pay cash for it.
I'm assuming your car is old/tired?, you didn't say whats wrong.........
All old, tired cars break down regularly and you need to have money put aside for that event.
 If you have not budgeted for car problems then you took a risk and you lost, lesson learned?
Buying another old/ tired car (you must assume it will cost bucks to fix over time also) particularly as you need to borrow to buy that replacement car is a bad idea and (unless you a VERY lucky) will probably see you in a bigger mess.............
You say there is NO WAY to get to school without a car, is that true because if it is you can't attend school without taking a big risk financially....................
Sounds to me you need to be cutting your spending to the bone in order to save as much as you possibly can.
You mentioned a few things to do with your spending that are not SURVIVAL related.
Moving out of home is an expensive luxury in your position, the luxuries have to go if you are serious about saving (yes i know that hurts).
Believe it or not people can live without a cell phone, that probably sounds like heresy to a young person LOL
School books can often be sourced second hand, looks don't count.
Tell us in detail what else you spend money on??

I spend money on gas, food, and pretty much school. I was going to get another tattoo, but that's pretty much out of sight right now. That's not happening any time soon and I can't even guess when it will be. I used to buy little things here and there, like a shirt or a comic book for my boyfriend, but I haven't bought something like that in about 2 months because I'm trying to save cash.

 

The problem with my car is that it has a cracked head. Meaning the radiator does not hold water. Period. When it's done leaking out all the water, it starts leaking out pressure and makes a hissing sound, which leads to overheating. That is a very important part of the engine that is more expensive to fix than it would be to buy another car. My car isn't actually that old, it's just a piece of junk. *Kicks tire*

 

And no, I do need my cell phone. That's not being cut, sorry about that one. The thing with that is, once my car decided to stop moving...in the middle of the freeway. No one stopped to help me and I sat there for about 30 minutes waiting for my boyfriend to come help me. If I didn't have my cell phone, I might have had to spend the night on the freeway. That's why I have my cell phone. In case of emergencies like that.

 

I would be taking the bus to school while I saved for a car, but the problem with that is that the nearest bus stop from my house is about a 25-30 minute walk. Not to mention the busses in my city are almost always late. Sometimes by an hour or more. If I get out of a class at the college that is 45 minutes from where I work at 4:30 in the afternoon, and I have to be at work at 5, the bus won't get me there on time.

 

I have to buy a car from craigslist or carmax or something, because I have no credit, and can't afford cars from a carlot anyway. So I have no choice on that one either. I've been lucky to find a few good ones that have new parts and other new things put in them for about $850-$900, so I'm contacting the owners of some to see if they can take payments, because I can't give it to them all at once anyway. I'm looking into ones that don't need work on them. Believe me, there's no way in hell I'm going to buy another car like mine. The last thing I need is one that needs a bunch of work on it.

 

My boyfriend said that he will help me with one of my classes, and that he can wait on the extra $150. So that helps too.

 What make, model, year and mileage is your car please?
Tell me about any other problems the car has which will need fixing in the near future (structural rust, noisy transmission etc) and also mention any repairs you have done on it to improve its life expectancy such as a new fuel pump or whatever.........
I've been a car buff since I was a kid and that wasn't yesterday so yes I know about head issues.
OK just a couple of quick questions.....
If the crack is not diabolically bad it can sometimes be kept running with radiator stop leak which temporarily blocks the crack. Have you tried this yet?
Is your boyfriend or anybody else in a position to physically make repairs if you had the parts?, are your people mechanically minded and prepared to help or are you gonna have to pay a workshop to do any repairs?
I'll get back to you on the other points you raised soon, in a hurry.......

 Redfeathers I know I'm bombarding you with advice you never asked for and that this advice is probably contrary to the way your peers operate, there is a reason.
I've never had a well paid job. I'm now in my 50's and owing to ill health have not been able to work for over ten years. I receive a disability allowance. I've had other bad luck too but I won't bore you with that.
To put it simply if I had the same attitude to money that most people do then I would live under a bridge.
I own my  home, I own my household necessities, I owe nothing to anybody  and I have savings for emergencies.
However weird my advice must seem to you, I'm a survivor and luck is not a factor.
Spend 30 valuable minutes reading the tales of financial disaster written by other folks on this board.
Some of these folks will have had bad financial luck true but in this cold hard world bad luck must be allowed for or we collapse.
These tales of disaster reveal that these people took risks, like borrowing dangerously or forming a relationship with an untrustworthy person or just being financially irresponsible.
You are young and hopefully have not yet learned too many bad habits about money, there is hope for you if you are clever.
I don't waste good advice on most of the disaster victims because in a lot of cases they have dug themselves into a hole nobody can get them out of even if they would listen to good advice...........

Buying a used car that has nothing wrong with it and that will never cost you anything in repairs for about a grand is a fairytale............sorry
Borrowing to buy that fairytale is a bad idea in your circumstances.
If you must buy a replacement car then get one with KNOWN faults that you can live with.
I bought my girlfriend a car recently, she has zero bucks.
Her car had been an insurance writeoff, stolen and vandalised, looks terrible but will last for years.
I'll grant you this car would not earn her any street cred (sympathy probably!) LOL but it keeps her mobile and for probably three grand less than a pristine example of the same make.
I mentioned the cell phone more as a lesson for you............
Most folks would spend maybe $20 a week on a cell phone, its just one of many ways people these days spend bucks without any thought.
$20 a week is $1040 per year.
I promise you if you spent $1040 per year sensibly maintaining a cheap car it would rarely break down and then nobody needs to worry about being stranded on the freeway at all.

My dad was a mechanic for over 25 years. He already put a stop leak in it and that's been blown through too. My car is a 1992 Ford Tempo, and I don't know how many miles are on it. My dad has worked on it multiple times, tuned it up, new thermostat, etc. The car is just a piece of junk. It is so bad that once it's leaked out all the water in the radiator, it starts leaking out pressure and makes a loud hissing sound. The other day, I was late for work because it stalled in the middle of the road and I saw smoke coming out from under the hood. Also, when it used to overheat, it would get so hot that the water in both the reserve tank and the radiator itself would actually start boiling, and I could hear it from the driver's seat.