Need advice on my debts

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1ke said:
Definitely cut up the credit cards and get some credit counseling. Learn how to make a budget and stick to it. You have a loan to pay off prior loans, that is concerning.

Contact local banks and credit unions to see if they are offering any money management classes, also inquire at the library.

Ramsey’s stuff is good, but Financial Peace Univeristy is another couple hundred you don’t need to spend. Check his books out at your local library and read them.
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FPU is currently $109.

daveramsey.com/store/cFPUclasses.html?snid=store.fpu

If the OP goes to every single class and engages in the process, it will be well worth it.

The personal accountability from being in a small group is a very important feature–you can’t get that from a book. But if the OP would get The Total Money Makeover from the library and see an in-person charitable financial counselor, that might do the job nearly as well.
 
Burt_Macklin said:
Avalon, one thing that I can’t help but think is that it will take forever to pay off 20k in debt on what you must get paid as a secretary. I would start looking for ways to increase your take home pay. What I’ve seen several women in your circumstances do - and you can decide for yourself if it might work for you - is work as catering crew for the maritime or oil and gas industry. The major advantage is that you’ll make about 40hrs of overtime a week and you’ll be able eliminate the cost of room and board by living in a man camp or at sea. It isn’t for everyone and it may not be for you but it is something you can think about. It can’t be that hard to get hired either because it seems about half of the crew that I meet is either on work release or has an extensive criminal record. 😃
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This was suggested to me too, and it wasn’t worth it. Now that the industry has tanked those opportunities aren’t available. We had people working at those camps get laid off and told to find their own way home. The oil and gas industry is not the place to right now. Everyone I know who worked in the oil and gas industry has been laid off and can’t find substantial employment.
 
Deo_Gratias42 said:
This was suggested to me too, and it wasn’t worth it. Now that the industry has tanked those opportunities aren’t available. We had people working at those camps get laid off and told to find their own way home. The oil and gas industry is not the place to right now. Everyone I know who worked in the oil and gas industry has been laid off and can’t find substantial employment.
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Bummer!
 
Some ancient (Plutarch, maybe) said: that for which we lack sufficient gratitude now is that for which we aspired, long ago.

I agree that a paid-off, mechanically young Honda is worth keeping. Murphy’s Law says that within weeks of selling it, you might experience a life change (layoff/transfer, bus millage failure, tornado, mooching relative) that would make you desperate for a hoopty-mobile so decrepit that vultures follow it.

(Besides, if that tornado did strike and you had to live in your car for a few weeks, wouldn’t you rather live in a nice one? Seriously, though, relax, the odds are against it.)

One area people haven’t mentioned is utilities. Heat is designed to keep you alive, not to substitute for spending winter in the tropics. Turn it down to 60 F or below and wear a sweater. Put LED lights in your fixtures. They even have LED nightlights now. Put lights on a timer instead of leaving them on. By itself a mini-fridge can cut $20 US a month off electricity, compared to a full-sized refrigerator. Use free library internet instead of owning it yourself. Try to use the slow cooker instead of the oven. And if you like long showers or baths, put a timer nearby, especially one with an annoying alarm.

Having said that, such tactics might save $100-200 a month. It does sound as if you need more. Dave Ramsay has a bit of a mouth on him – but he’s dainty compared to Larry Winget (You’re Broke 'Cause You Want to Be).

Liz Perle wrote a book called Money: a Memoir that touches on the many ways that women are not taught how to handle money, including the bag-lady fear you’ve hinted. Stanley and Danko wrote The Millionaire Next Door (and its sequel The Millionaire Mind) to explore the right ways and wrong ways to view money. Neither book will give specific advice, but they do explore motives. And unexamined motives is how most people get into a mess. Highly recommended.

You’ve done one thing very, very right. Your debts are what is called Unsecured Debt. Secured Debt is when they can take back the thing you purchased, such as a home or car. Unsecured means that if you don’t pay, they’ll take your reputation, because you gave your word that you would repay. That stinks, but not as much as much as Secured Debt.

As for worrying about paying your bills before you die, get enough life insurance to pay your bills, provide a decent funeral, and maybe a little left for church and charity. Then you can buckle down to the business of getting these things while you’re alive to enjoy them.

Keep us posted! 🙂
 
1ke said:
A debit card or prepaid credit card would work fine for those.

I am not opposed to credit cards, I have one credit card. I suggest cutting up ALL store cards and canceling them. They have extremely high interest rates and the stores bombard you with “savings” for using the cards-- 20% off, $10 off-- knowing people overspend and don’t pay off their balances. That “savings” is no savings.

In fact whenever I shop somewhere and the clerk tells me I “saved” $42 dollars", I say “no, I spent $37 dollars”… That always confuses them. Even the people who work there think of purchases in terms of “saving” rather than spending. A mark up in order to mark down is nonsense.

Reprogram your thinking!!!
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I absolutely love this! I wish I could get this through my mom’s head when she says that exact same thing…“but it was only $9.99. You can wear it in the garden for that price.” And then I see this stuff that she donates that she doesn’t even wear. Thank goodness she doesn’t do it often and is not in debt, but it drives me crazy!

DH and I think like you do…it the mathematical geek factor we both share, I suppose…for us, at least.
 
My biggest red flag here was worrying about if the OP is funding her retirement. Hopefully her job comes with benefits, but medical deductibles are outrageous and can easily lead to medical bankruptcy (which I do not want the OP to experience). I saw it way too up close and personal.

I only know about Dave Ramsey from his stock picks. I tend to be a Suze Orman fan (despite her lifestyle, this woman has a great head on her shoulders). She constantly has me asking, “Is this a need to have or a have to have.” I think it is similar to Dave’s thinking that there are have to haves–food, clothing, shelter and I would add term life and medical insurance, along with a retirement plan.

Because I prepare tax returns, I see everything–and too much of the worrisome stuff and not enough of the savers stuff. I don’t know if the OP has a computer, but I recommend to my clients (I also have a financial planning and ACA certification) that they buy a copy of Quicken or, if no computer, get a regular booking ledger and write down every purchase to the penny so you can see where your money is going. Quicken breaks down expenses in categories a little quicker and easier, but a ledger would work. It opening my newly married eyes. And because DH and I came from toxic families, we worked to be independent of them as fast as we could.

I know that Uber drivers tend to be in demand, and I have heard of many people doing that as their side occupations when there are no cabs. I have used Uber drivers when my car was in for inspection or when I didn’t want to drive on medicine. Many home bound people use Uber to help them shop on weekends. I think you go to uber.com for details.

I hope some of this information helps.

Good luck!
 
pensmama87 said:
Or get a debit card. I have one tied to my checking account. It has a major credit card logo on it and I can use it exactly like a credit card - the money just comes directly out of the account. I primarily use it for gas (or unmanned parking if I don’t have enough change.)
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I tried using my debit card from my Credit Union (it has the Visa logo) and it was declined because they switched it to a debit only card! Mine used to my like yours…not sure when things changed.
 
1990Domer said:
My biggest red flag here was worrying about if the OP is funding her retirement. Hopefully her job comes with benefits, but medical deductibles are outrageous and can easily lead to medical bankruptcy (which I do not want the OP to experience). I saw it way too up close and personal.
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No use saving for retirement when the OP doesn’t have a positive cash flow. She could put $10K a year into retirement, only to have to pull it out next year because of an emergency (and pay the additional fees for pulling it out). Better to start slow, get a small emergency savings, pay her debts down, build a bigger emergency savings, and THEN start on retirement.
1990Domer said:
I only know about Dave Ramsey from his stock picks.
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Never heard Dave Ramsey pick stocks. I’ve heard him say he doesn’t own stocks at all, but instead invests strictly in mutual funds (and real estate).
1990Domer said:
Because I prepare tax returns, I see everything–and too much of the worrisome stuff and not enough of the savers stuff. I don’t know if the OP has a computer, but I recommend to my clients (I also have a financial planning and ACA certification) that they buy a copy of Quicken or, if no computer, get a regular booking ledger and write down every purchase to the penny so you can see where your money is going. Quicken breaks down expenses in categories a little quicker and easier, but a ledger would work. It opening my newly married eyes. And because DH and I came from toxic families, we worked to be independent of them as fast as we could.
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Quicken is big, complex, and expensive. Probably works well for someone with complicated finances, but not appropriate for a relative novice.

The “Name Every Dollar” budget is FREE, and works well.

Agree with the Financial Peace University recommendation. It may be the BEST $109 you will EVER spend.

When dealing with complicated issues, it is often better to follow the KISS mnemonic…Keep It Simple Silly. Dave Ramsey’s plan keeps it simple and it works for everyone.
 
I have to say I’ve found budget software to be needlessly complicated. I’m relatively computer savvy, but I hate Quicken and do not find it intuitive. :o The free online ones contain a lot of ads for credit cards, etc.

I used to do budgets on paper, and now I do an Excel one I built myself. Our income goes on the top, expenses below. Simple formula to subtract expenses from income lets me know how much I have leftover every month. I do cash for groceries, but my utilities are on auto-pay. I log in to my online banking once a week to make sure everything is going through OK.
 
pensmama87 said:
I have to say I’ve found budget software to be needlessly complicated. I’m relatively computer savvy, but I hate Quicken and do not find it intuitive. :o The free online ones contain a lot of ads for credit cards, etc.

I used to do budgets on paper, and now I do an Excel one I built myself. Our income goes on the top, expenses below. Simple formula to subtract expenses from income lets me know how much I have leftover every month. I do cash for groceries, but my utilities are on auto-pay. I log in to my online banking once a week to make sure everything is going through OK.
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I do a paper budget, too.

The OP may find a computer version more friendly, though, if she spends a lot of time on the computer.

I also recommend dividing the grocery budget up into weeks rather than just doing a month, as it’s one thing to miscalculate clothing needs, and quite another to discover (20 days into the month) that you’ve spent all the grocery money.
 
Dave Ramsey has a free budget tool, Every Dollar. I’ve not used it but it seems pretty easy from the descriptions. It is also an App for smartphones.

everydollar.com
 
1ke said:
Dave Ramsey has a free budget tool, Every Dollar. I’ve not used it but it seems pretty easy from the descriptions. It is also an App for smartphones.

everydollar.com
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Ooh!

Thank you!

Didn’t know about this tool. We’ve done crude paper budgets. Well, my husband does. He does our finances.

I’m going to run this by him.
 
pensmama87 said:
I have to say I’ve found budget software to be needlessly complicated. I’m relatively computer savvy, but I hate Quicken and do not find it intuitive. :o The free online ones contain a lot of ads for credit cards, etc.

I used to do budgets on paper, and now I do an Excel one I built myself. Our income goes on the top, expenses below. Simple formula to subtract expenses from income lets me know how much I have leftover every month. I do cash for groceries, but my utilities are on auto-pay. I log in to my online banking once a week to make sure everything is going through OK.
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I had the Mac version of Quicken which was cheaper, simpler and less feature bloated than the Windows version. It gave a breakdown of where DH and I were spending money. I think a couple things people forget are those little WaWa coffees and vending machine snacks that add up. DH (and once me) has packed his lunch every day since he started working. When we were married, he made mine too! I’m a lucky wife.
 
No use saving for retirement when the OP doesn’t have a positive cash flow. She could put $10K a year into retirement, only to have to pull it out next year because of an emergency (and pay the additional fees for pulling it out). Better to start slow, get a small emergency savings, pay her debts down, build a bigger emergency savings, and THEN start on retirement.

Actually, OP can do both! Open a Roth IRA. It’s an after tax funded account where all the earnings are tax free when used for retirement. Also, so long as you don’t pull out your earnings, you can take money the money from your Roth with no strings attached. Two for the price of one!

P.S. Sorry, I didn’t know how to use the quote feature.
 
About stock picks, Dave will sometimes give his opinion on certain stocks on CNBC or MarketWatch. That’s the only place I know him from because I tend to read almost entirely financial or Catholic news…well, or Notre Dame. 😊
 
If your car is paid off, I would advise against selling it. There will probably be a time when you really need it and find yourself going into more debt to buy a new one. If it costs more to drive your car to work, you can save money by riding a bus.

Look at the little things. How much money do you spend on eating out or buying lunch?
What do you spend on TV programs?
What do you spend on a cell phone?

Cut back on the little things you may be surprised how much you spend on those.
 
HelenRose said:
If your car is paid off, I would advise against selling it. There will probably be a time when you really need it and find yourself going into more debt to buy a new one. If it costs more to drive your car to work, you can save money by riding a bus.

Look at the little things. How much money do you spend on eating out or buying lunch?
What do you spend on TV programs?
What do you spend on a cell phone?

Cut back on the little things you may be surprised how much you spend on those.
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Also, I found when you have been with an insurance company for too long, they will lower your rates if they sense you will jump ships. Personally, if the can afford to giving others lower prices, they should do the same for you! Without you having to ask!

Finally, if your taxes are simple, can you shop around if someone does then for you? CPA’s charge a lot, as the EA’s or enrolled agents. I am a Registered Return Tax Preparer certified my the IRS. So, I do individual and small S-Corp taxes). They do a good job for a fraction of the price. I do not recommend chain preparers like Block, Jackson Hewitt etc. I volunteer to outreach programs to help those filing their taxes have one less worry.
 
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