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Author: roush17 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308470  
Subject: I would like to thank the entire board... Date: 6/17/2002 9:55 PM
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Before browsing this board my wife and I were ashamed to admit our credit cards were out of control, to the point that we basically avoided discussing it because we thought we were weak individuals... We thought we were the only ones in America with close to $10K on CC's and it eventually bothered me to the point that I take anxiety medicine... But now we have faced the issue and have taken steps to get the job done, get consumer debt free by Christmas of 2004 and enjoy our peace of mind... Thanks for the help and letting us realize we aren't the only ones in this boat...

Jon
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Author: tconi Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130911 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/17/2002 10:02 PM
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We thought we were the only ones

If not the only ones, well, the only ones who let it get out of control...
I know this feeling, as do many others who have expressed the same relief in their posts. There is something really liberting in just writing it out there for everyone to see -
Thanks for joining us and keep posting on your progress.
peace & debt
t

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Author: dianakalt Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130915 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/17/2002 10:47 PM
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roush,

the hardest part in this whole debt-paydown process is acknowledging that you have been living above your means and figuring out what EXACTLY the damages are. from there, you can develop a plan to pay everything off, and i have no doubt that you and your wife can do it!

d

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Author: ishtarastarte Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130916 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/17/2002 10:52 PM
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Welcome!

You'll find that there are some people in much worse circumstances than you.

Good luck!

Feel free to share more!

Ishtar

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Author: Pennsyltuckian Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130920 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 1:02 AM
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<Before browsing this board my wife and I were ashamed to admit our credit cards were out of control, to the point that we basically avoided discussing it because we thought we were weak individuals... We thought we were the only ones in America with close to $10K on CC's and it eventually bothered me to the point that I take anxiety medicine... But now we have faced the issue and have taken steps to get the job done, get consumer debt free by Christmas of 2004 and enjoy our peace of mind... Thanks for the help and letting us realize we aren't the only ones in this boat...>

I feel you, brother.

My first post -- my last day in debt.

September, 1999 -- Total income, $45K / Total consumer debt, $32K

That winter, we had gotten a consolidation loan for 23K from our bank. Thought we were home free. To celebrate, we charged another $9 grand in the next six months. Then I got fired. We were both sick and depressed. I was trying to be the MAN of the family - taking care of the finances, not giving my wife anything to worry about. I wanted her to think everything was going fine.

And she did.

Until the week (I swear, this actually happened) that our water, gas, and telephone were all shut off within 72 hours. Suddenly, I didn't feel so manly any more. We sat down together. We decided to stay married. We got into therapy - I got into recovery - we registered with Genus Credit management.

Today, the last auto-payment came out of our checking account.

Digging the hole nearly cost me my sanity, my home, and my marriage. Digging out has given my family a new sense of sobriety and security. We have worked hard to get to this place, many tears were shed, and many hard choices were made, but we are still together, still in love, and finally FREE!

Last week, I realized something. My Genus payment was actually a little larger than one of my twice-monthly paychecks. I just got a 55% raise!

Already have the auto-payments scheduled for the IRA, the 401k, and the e-fund. They all kick in next month. We also begin saving for a new car.

The credit counselling, the TMF books, the dicipline of the monthly auto-pay (I wish I had the will to do it without them, but my snowballs didn't have a chance in H-ll) - we've worked hard to educate ourselves to live within our means and to pay ourselves first. I just started lurking on this board a few weeks ago, but knowing that there's a community like this, where I can come and share and celebrate and grieve and gloat with people who have "been there-done that-got the tattoo" gives me such hope. I really feel like my wife and I are starting a new life, and we're doing it together, and we're doing it with the help and support of a bunch of people we don't even know on this board.

Jon, you and your wife have discovered the same first step that we found - you're telling each other (and yourselves) the truth about money, and your relationship to it. I can't say what will happen to you on your journey, but if you stay the course, you'll learn an awful lot about yourselves, about each other, and about a saner, more prosperous way to live.

God bless you, and God bless all who post here on this Foolish little board. We are saving money, saving ourselves, and helping to save each other just a little bit, every day.

Peace, y'all.
bob


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Author: pailyeller Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130921 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 1:05 AM
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Pennsyltuckian,

What an amazing first post.

Congrats on your success!

laura

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Author: allienic98 Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130929 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 7:05 AM
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Jon,

Don't feel bad...I'm DOWN to $36,000. Some of us had to dig ourselves in very deep before we "woke up and smelled the coffee". But, one way or another...with all the help and encouragement from this board...we will all be debt free!

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Author: TamarianG Big red star, 1000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130957 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 10:57 AM
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Jon, well done. I think that part of the credit overload problem is that we are all ashamed to talk about it. I can't tell you how many times I've embarrassed friends at gatherings by (gasp) talking about...well...you know...

But you know, I find that the more I stand up and say, "GEEZ, were we stupid, WHAT were we thinking, HOW did we run up sixty THOUSAND dollars on credit cards, MAN that was hard to get control of, but BOY is it ever great to be on top of it now," the more people sidle up to me and say things like, "Hey, we've got, well, a lot of credit card debt...how do you go about...?"

In talking about it, you've gone beyond the more selfish goals of personal debt control. You've become a teacher, a mentor, an example for others. You've become one of the beacons of hope. Yeah, I know, you don't feel like a beacon of hope. But you are. I really think that it's only going to be through people like you talking about the problem that others are going to start realizing that it doesn't have to be business as usual to be drowning in a sea of interest charges and fees; to be signing over your paycheck to Mastercard so you can get just enough room on it to charge the next round of playthings.

So, congratulations and thank you. You're officially part of The Solution. :)

Onward!
Tamarian

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Author: payumoff Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130970 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 11:53 AM
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TamarianG is already one of your Favorite Fools.



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Author: InvestorGrrl Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 130986 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 12:44 PM
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We thought we were the only ones in America with close to $10K on CC's and it eventually bothered me to the point that I take anxiety medicine... But now we have faced the issue and have taken steps to get the job done, get consumer debt free by Christmas of 2004 and enjoy our peace of mind... Thanks for the help and letting us realize we aren't the only ones in this boat...

That's a killer, isn't it? The good thing about the semi-anonymity of the board is it allows people who otherwise wouldn't be open about their debt to take the first step out of the red by posting: "Yeah, I owe money. But I'm working on a plan to stop that." That's probably why the face-to-face debt meeting group I'm in has only three people -- we know each other's last names, we know what each other owes, and we know what each other's plans are for getting out, and how they're getting out.

There aren't enough <EM/> and <STRONG/> tags, not enough capitalization of the letters, not enough bandwidth provided on this board for me to wholly let you know how much I wish your message would be distributed to thousands more of people with large credit card and consumer debt, and they would come clean and start on their path away from the anxiety medicine. Until they wise up and follow in your and others' brave footsteps, I'll be investing in pharmaceuticals and credit card companies.

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Author: KennyO Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131021 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 3:04 PM
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I'm proud of you and happy for you both, roush17!!

I've always been a little overboard about avoiding debt but I'm surrounded by people who may never take the steps that you did to turn your financial (and emotional) life around. The coming peace of mind will be one of the best gifts you'll ever receive. Be sure to pass it along.

KennyO

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Author: wildwoman1 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131028 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 3:37 PM
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Mazel tov! Breaking any bad habit is very hard.

I was in credit card hell (well purgatory anyway) for awhile after my divorce. Now I pay my balances in full every month and it feels WONDERFUL!

Here is a technique I use to help:

Say I charge something on my Mastercard (ie, fabulous red shoes $50). I sit down and write a check for $50 to the credit card company. On the memo line I write "Fab Red Shoes, 6/18/02". Then I put said check into an envleope marked CREDIT CARD CHARGES. When the bill shows up at the end of the month, I have most of the $$ put away already (1 or 2 small items usually get away from me each month).

If my balance in the check book gets below zero, I write it in red, which alerts me that I am now officially Spending Beyond My Means.
(I don't do the red # thing in the Joint checking account, because aI share that with a CPA. They get dispeptic when they see red numbers).

In any case I find that to be a useful technique.


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Author: wildwoman1 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131029 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 3:38 PM
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Mazel tov! Breaking any bad habit is very hard.

I was in credit card hell (well purgatory anyway) for awhile after my divorce. Now I pay my balances in full every month and it feels WONDERFUL!

Here is a technique I use to help:

Say I charge something on my Mastercard (ie, fabulous red shoes $50). I sit down and write a check for $50 to the credit card company. On the memo line I write "Fab Red Shoes, 6/18/02". Then I put said check into an envleope marked CREDIT CARD CHARGES. When the bill shows up at the end of the month, I have most of the $$ put away already (1 or 2 small items usually get away from me each month).

If my balance in the check book gets below zero, I write it in red, which alerts me that I am now officially Spending Beyond My Means.
(I don't do the red # thing in the Joint checking account, because I share that with a CPA. They get dispeptic when they see red numbers).

In any case I find that to be a useful technique.


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Author: FloatinFool One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131091 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 11:08 PM
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wildwoman wrote: Say I charge something on my Mastercard (ie, fabulous red shoes $50). I sit down and write a check for $50 to the credit card company. On the memo line I write "Fab Red Shoes, 6/18/02". Then I put said check into an envleope marked CREDIT CARD CHARGES. When the bill shows up at the end of the month, I have most of the $$ put away already

GREAT idea! I do something similar (can't afford to write ALL those checks!). Since I track all of my expenses in Quicken (well, the Miscellaneous category gets pretty vague), this is what I do...

I find fabulous red shoes and charge them on the spot. Careful to leave credit card receipt in conspicuous spot in my wallet. When I get home, I enter the transaction in the credit card's Quicken account.

The kicker is that I keep a running transfer each month from my checkbook account to each credit card account and add the amount of each transaction to that transfer amount. Then when the credit card invoice shows up, the money has already been "transferred" out of checking account and it's no new skin off my back to write the check to the card company.

For snowballing, I start each month's transfer amount with the snowball amount, and then add any transactions to that as they crop up.

Works for me (and I don't have to keep ordering new checks),

Still, Floatin


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Author: GoCowboys Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131092 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/18/2002 11:38 PM
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I have decided to do something similar. I am going to start using my credit card everywhere I would normally use my check card. Let's say I make a $25.00 purchase at Wal-mart. I would transfer $25.00 from checking to savings. At the end of the month, I would make one transfer from savings back to checking and pay the credit card bill off.

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Author: robertkcox Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131282 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 3:13 PM
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Good for you but why are you buying a new car? After what you have been through especially if you are not going to pay for all of it. What is wroug with a good used car? Good luck anyway, I just don't quite get it. Regards

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Author: KillJoy100 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131287 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 4:02 PM
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Hello Foolish Ones,
This is my first post and it is pretty ironic that this is the first Fool board that I have read any messages on. The reason why I say this is because I too was caught in the credit card trap. I thought it would never happen to me. I have had credit cards for years and managed to control them fairly well.
I woke up one day and realized what I had done to myself in the previous 6 months. I was not in control of my own actions.
Just to give you a brief background…I had been in a bad relationship for the previous 4 years. Out of this relationship came my son, a gift from God. I had lost about 94% of my retirement account from very bad decisions at the height of the electronic down turn.
I decided after this happened that I was going to spend some money on myself instead of hording it all in the retirement fund. I was out of my stinking mind. I bought many, many nice things that I had wanted for so long… All with credit cards. $20,000.00+ worth…. This was the beginning.
Not long after I did the credit card thing, my bad relationship left with my son. I immediately hired the best attorney I could find. $20,000.00 later I did gain custody of my son.
These two items are not including the debt that I had already incurred from a new truck, my bad relationship's car, my house, department store debt and so on. I was in trouble and could not remember exactly how I gotten to that point.
I did not ask for help from a credit counseling service. I should have to make sure whatever had caused this sickness would not effect me again. I was lucky.
I refinanced my house, the only asset worth anything that I had left. I also put a second on the house. It covered all my bills but that security was gone and I have a large payment to contend with now.
Things are starting to settle down and my son and I are doing well. I have some distance to travel before the effects of my sickness go away but I am going to make it.
If I could help stop one person from getting into the credit card trap by telling you this then I would be happy. Please beware; credit cards can trap any one of us.

Regards,
Mark


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Author: diave Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131312 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 5:59 PM
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Tamarian: "But you know, I find that the more I stand up and say, "GEEZ, were we stupid, WHAT were we thinking, HOW did we run up sixty THOUSAND dollars on credit cards, MAN that was hard to get control of, but BOY is it ever great to be on top of it now," the more people sidle up to me and say things like, "Hey, we've got, well, a lot of credit card debt...how do you go about...?"

Hello,

I am new to this board. I have been struggling with consumer debt since losing my job in high tech 14 months ago and took the early retirement option. My consumer cdebt onsists mostly of CC debt but I have a car loan as well, which will be paid off October 2002. However, I intend to apply that budget allocation to reducing my CC debt. Reading the responses associated with this post are both sobering and hopeful.

I tried an approach from another internet site back then that got me started (I could not believe that I had consumer debt of 53K, it is now nearing 44K) but I am still losing ground when an emergency is encountered. That site uses an approach that pays off one card at a time and then adds that payment onto the minimal of another and so on until the lot is paid off (in my case in 2005). They focus on paying cards off by selecting the next CC with shortest pay-off interval. They also strongly recommend against taking out a loan to pay it off (i.e., to reduce it down to a single monthly auto-payment as per this board's posting).

Their fear is that it [debt consolidation loan] lends itself to continued CC usage, and that would happen for me when an unexpected emergency occurs. For example, one emergency I had was the unexpected cost of repairing my wife's car (a $2200 repair). Another was an unexpected dental expense. Also I started a small consulting Sole Proprietor business with start-up costs funded theough CC debt(lap-top, printer, etc.) which was operational for a short period of time (four months) until the business I had a retainer with to cut there contractors. Since then consulting jobs in the telecom business service industry in my area have dried up (I am now re-tooling my programming skills in XML and JEE2 to be ready for the market upswing projected for 2003).

However, reading the responses to this posting suggests that it may be more appropriate for me to do so (i.e., take a debt consolidation loan). Is this correct? What other approaches should I be considering to deal with emergencies?

Also I have a son going off to college this August, and his college fund went south with the telecom market. We are going to use what little remains of the technology stocks (CSCO,LU,NT,etc.), our savings, financial aid, and a HELOC. Using a pay as you go plan.

Any and all suggestions and guidance would be appreciated -- thanks in advance.

diave

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Author: FROSTJ Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131313 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 6:02 PM
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I too have seen the worst side of debt...At one time I foolishly owned a new 1991 Toyota extended cab truck, two motorcycles, a boat, a 1966 buick special convertible, a 1966 convertible Corvette (fully restored),credit card debt and was renting a duplex with three other guys.

I set down one night, because I was always broke (obviously), and, surprize, I was paying out more than I was bringing in. It wasn't really obvious though because I make a good salary and it was the insurance, taxes and tags that was always throwing me for a loop. They were only every six months as you know. So some months it seemed ok but others were tough.

Anyway I sold a lot of the stuff but the credit card stuff is what I really wanted to talk about. I have always had a credit card balance, and probably always will. Sometimes larger than other times but I have gone to switching credit cards regularly and transfering them when the intorductory rate runs out. If operated properly you can maintain this debt while you are paying it down almost intrest free.

Yes, you have to stay on top of it or pay high intrest or late fees if you fail to keep things straight and miss a payment. I started this of an on back in 1995 and have not payed over 5.9% intrest since then. Current rates are 0% for six months. I keep one credit card that I pay off every month and I have seen the large balance continually dwindle down. I figure in about 2 years it will be at zero. Are others doing this? Maybe it would be an option for those serious about getting out of debt. It's working or me.

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Author: Stockbuyer2 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131317 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 6:11 PM
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diave

"Also I have a son going off to college this August, and his college fund went south with the telecom market. We are going to use what little remains of the technology stocks (CSCO,LU,NT,etc.), our savings, financial aid, and a HELOC. Using a pay as you go plan."

I hope you are also using the "son get a job while your in school" plan.

Stockbuyer2

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Author: diave Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131352 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 8:44 PM
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Yes -- it is on our list. I do need to raise the visibility level "son get a job while your at school" much more than it is. Although he did fill in the appropriate job blanks on his financial aid application to NYU.

diave

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Author: AnneOwens Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131362 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 10:30 PM
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Last September, I finally added up the total of all my credit cards and owed $90,000. My boss had requested I take medical leave for the month to try to get my sleep problem and depression resolved so that I could do my work. I am single. I go to a psychiatrist and a hypnotherapist.

I ran up the credit card debt during the five years I took care of my mother after Dad was killed in a car accident. They were 86 then, and Mom had a stroke four months later. I kept her at home but paid two girls to take care of her as she could not walk or do much of any-thing. She had property, stock and income but we spent more than we earned and used up stock. Of course, I increased my spending habits too as I was depressed and shopping was fun. I did not realize I was running up so much debt.

After September when I started trying to pay off this debt and keeping track of my finances, I realized that I needed to pay at least $2000 a month toward the credit card debt. Most of the rest of my salary went toward mortgage and utilities. Thus, I had to charge groceries and anything else I bought. Needless to say, I wasn't getting the debt down much. I sold two houses since September -- which were rented, and applied this to debt. I transfer the debt around to get lower interest rates. I still owe about $50,000, so have quite a way to go. I'm still struggling with the depression and trying to keep my job. My sister and I own a farm in Ohio where we grew up and get a little income from that, to split between us. We want to keep the farm in the family. My sister has two children. Her husband supports her. Thus, I have nothing left to sell unless I find time to sell on eBay.

While trying to pay my debts, I took a course at my church called Crown Ministries, which is about financing and getting out of debt. Besides what I learned, I met weekly with a small group of others who had debt problems. It helped me a lot to curb my spending habits. I have been reading the Motley Fools debt suggestions, though a lot of ideas don't apply because I almost never I eat out and do the things that can be cut back. I don't smoke and rarely drink. I do have two dogs and four cats, and feed 2 racoons outside, but I can't part with my pets. They are my family now. I do have high medical bills for my mental health problems but need that help to keep my sanity and my job.

Anyway, I think I am on the way to recovery but have a long way to go. I have several of my credit cards at 6.9 and 9.9 interest til paid off -- through balance transfers. Once I can pay less on these cards, I will have enough to live on, I hope.

Although we were not wealthy when I was a child, I have never had to worry about having enough money before. I am an attorney so know about finances but I work for the state and make about $55,000, which is not a lot for a lawyer! Guess I've gone on long enough but just wanted you all to know, you're not alone! In fact, I think lots of people just don't tell anyone how much they owe. Good luck to all. Anne

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Author: Fallout2Queen Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131368 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 11:23 PM
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I do have two dogs and four cats, and feed 2 racoons outside, but I can't part with my pets. They are my family now.

Welcome to the board. There's also a Pet Lovers board you might enjoy:
http://boards.fool.com/Messages.asp?mid=17389402&bid=112961&sort=threaded


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Author: Pennsyltuckian Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131369 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/20/2002 11:44 PM
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<Good for you but why are you buying a new car? After what you have been through especially if you are not going to pay for all of it. What is wroug with a good used car? Good luck anyway, I just don't quite get it. Regards >

Very fair, very Foolish question.

Why a new car?

1. (a juvenile reason?) I'm sick of beaters! First car was a 13 year old 71 Beetle. Then a 6 year old 85 Taurus Wagon (moved to NYC after college- no need) Then an 11 year old F-150, a 13 year-old Pontiac 5000 (or was it 6000?). Right now we're driving a 1978 Mercury Cougar that runs like a top, looks like a dream, and burns more fuel than the Space shuttle in passing gear. (Garage sale - very motivated seller)

2. (a naive reason?) More predictable expenses. I've never owned a used car that I didn't buy at least twice. Once for the vehicle, and once for the brakes-starter-alternator-transmission-clutch-sensors-light-freakin-bulbs what have you. I'd like a vehicle that needs rubber, oil, fuel, and an occasional loving bath for a change. Preferably one with a long factory warrantee. Some of my biggest emergency expenses have been keeping clunkers on the road.

3 (a bleeding heart liberal reason?) Ecology.and Economy. I live in one of the most beautiful places on earth, and every time I start that big old 351 Windsor motor (purrs like a kitten - make me an offer?) all I can see is Bluegrass turning brown from all the junk pouring out of my exhaust pipe. Driving a really fuel efficient car is one way I can respond to a world where people are dying every day because I (and many more like me) need (?) 20 gallons of gasoline a week. A new car is my best on a car that is both clean and efficient.

4 (Foolish reason?) Getting the Cougar off the road. Seriously. It really is a sweet ride - and somewhere out there, there's somebody who really wants a classy looking land yacht with wire wheels, arctic air, and a factory installed 8-Track player (the Left channel still works - make me an offer?) It might be worth some dough if I can get if out of daily commuting duty.

Lousey reasons? Maybe. Would a two year old Corolla serve me just as well as a new Echo or Civic? Probably. "New Car" can be a pretty relative term when your car was built during the Carter administration.. Maybe I'm just looking forward to buying a car because it's time, and not because the one I'm driving is dead. Thanks for challenging me to think this through. Maybe we'll take a pop over to the local Enterprise lot - they sell off their fleet after a year or so.

Or maybe there's somebody out there with a '72 Charger who's always wanted to run with the Cat? Wanna trade? Make me an offer!

Peace
bob

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Author: TamarianG Big red star, 1000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131376 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/21/2002 1:25 AM
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Hi, diave. Boy, the dot.gone fiasco has really smarted, hasn't it? CSCO was a big old 'ouchie' in our portfolio, too. :(

The method you describe, of paying one card off at a time, is something we call the 'snowball' method. Our added caveat around here is that you put the debts in order of highest interest (even if the card has a higher balance), and send the majority of your funds to that highest interest debt first. It is the single best way to pay off your cards.

Consolidation loans can be a powerful tool, but they are a double-edged sword. They can create a situation where instead of having $44K on credit cards which you are whittling down, you have $44K in a consolidation loan...and $44K on credit cards. Generally, those of us in the 'been there, done that' crowd advise against them, ESPECIALLY when training unsecured debt for secured. Meaning, if the unthinkable happens and you default on a credit card, they do not have a lien on your house the way a second mortgage (a.k.a., a HELOC) does. However, you can get a fabulous interest rate on a HELOC which can increase your paying off power. It's all a matter of discipline and stick-to-it-ness: can you cut up those credit cards? Can you transfer the balances and keep your hands off them? Even for "emergencies"?

One of the things we often preach about getting together here at the Fool is called an emergency fund (or e-fund). Generally, you should have between three and six month's worth of living expenses in your e-fund; my own e-fund was what saved our bacon when my husband and I both found ourselves out of work this January. You build it slowly, perhaps by sending a set amount into a savings account each month. An e-fund should be fairly liquid - say, a money market fund, CDs, or even a good old fashioned passbook savings (although as is said I believe in the Fool guide to investing, there are mattresses which have better interest rates than a passbook savings account). You don't want it in the stock market for exactly the reason you've already encountered: you don't want a badly timed market crash to wipe you out right when you need the money most!

Hang in there on all this. There is a ton of information here on the Fool, and we really like to share. Take it in baby steps, and don't give up.

If you're looking for a step-by-step, start with your budget. If you haven't done this already or lately, track every single penny you spend, right down to the quarters in your pocket. Seriously. Not forever, but say for a couple weeks or so. Until you have got a really solid idea where all that money goes to when you aren't looking. I do this periodically and I'm always shocked at how my "miscellaneous" budget item has grown...

Onward!
Tamarian

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Author: Stlgrl Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131390 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/21/2002 9:23 AM
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I've put myself on a 5-year payoff plan for CC debt. I'm currently in year 4 and finally am able to see some real progress. Actually, it was a Motley Foot radio program that got me on this track several years ago. I started out with $45K in debt(and easily justified that with an income double that amount; company pays for the car and related expenses; just kept spending ... but no 401K [family-owned business .. my family] and not making real progress on that) and realized I really had to make some changes. All department store cards will be paid off by the end of this year, which is a major thing for me. The visas (yes, plural) will take a bit longer (5-year plan will probably become 6)but I'll get there! I finally started contributing the max each year to the IRA/Roth.

It's not necessarily comforting to know there are many others in the same boat, but MF has helped me realize that I can eventually be rid of this debt!!

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Author: RarusAvis Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131457 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/21/2002 6:48 PM
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RE: The debt burden can be H--l, that's for sure. My eldest
son is going through the painful realization that a six month
cushion of funds for emergencies (sickness, accidents, loss of job,
suddenly burdened with a married then divorced child and her
dependent) is an absolute must to survive in today's world.
Of course, he is only now learning this. Hindsight is 20/20,
I thank Providence for growing up in the years of the Great Depression
and having parents who were excellent role models. Somehow my wife
and I failed to get our experiences across to No. l son. His
trials are real and we help to the extent that me can. This kind of
story is the foundation for starting over and living at a level that
will not put you in a canoe withour a paddle.

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Author: january1000 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131470 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/21/2002 10:48 PM
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I owe about $10,000 in credit card debt. In the past four years I have refinanced my house (and took extra cash to get myself out of debt). Just this year I took a home equity loan to pay off debt (which I still dig myself into). I have a school loan to pay off. Car payment. And mortgage payments. I am not financially disciplined to set myself down to set myself straight. I was looking into ConsumerFirst@debt free. Does anyone know anything about this company? Then there is the MBNA loan consolidation offer. Tell me more about Genus Credit Management. I really want to be disciplined and debt free. I just need help.

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Author: Booa Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131481 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 12:35 AM
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Hey, january, welcome to the board. There are really great people here who have walked a mile or eight in your shoes, and they can give you really good advice.

Alas, I am not one of them. I can tell you a few things, like, take some deep breaths, because I was feeling a little freaked out by the end of your post, so if this is what the inside of your head sounds like, you must be feeling a little, well, stressed. It will be okay, and you can deal with it. That much I do know.

So, usually the more information and details people here have, the better advice they can give you. If you post your debts and the interest rates of each, and how much the balance and minimum payment are for each, people can help you strategize how best to pay it all off. We'll say things like, "You really need that much car?" and such. And you can do most of the things a credit management company would do for you, for yourself, for free.

Something that helps me is to write down everything I spend money on. If you look at an old credit card statement, and your check register, and more or less remember what you did with cash from the ATM, you can get a feeling where you spend money, and what categories to use for writing down your expenses. But when you write them down, even .25 for a gumball at Blockbuster, you can feel where your money is going and identify places to cut back. The first thing you need is information, and you can gather it without judging yourself, just gather it.

The other thing is, stop using the credit cards to pay for stuff. Go on a cash diet. Folks here can tell you more, but it's very helpful, 'cause you stop growing your balances with new purchases.

And an efund (emergency fund) is useful, too, for keeping you from charging emergencies. I am a big proponent of having an emergency fund. When you're trying to pay off debt, you can have a mini-one, like $500 or $1000, which you can build up slowly, don't look at those numbers and freak and think you gotta have that tomorrow.

So, relax, hang out, listen, and don't rush into anything with ConsumerFirst, or an MBNA loan offer, or Genus Credit Management. At least wait until Tuesday, people will have chimed in by then.

Doh! Sorry this got so long. Don't want to overwhelm you. Deep breaths and baby steps, and you can get out from under your debt. And when you do, the sunshine is going to feel *great*.


--Booa (just repeating what other, smarter people have said since 1902)

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Author: Pennsyltuckian Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131482 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 12:36 AM
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<Tell me more about Genus Credit Management. >

J1K,

Here's the link to their web site.

http://www.genus.org/

The server is brutally slow, but don't be discouraged.

Here's how it worked for us (after we tried many of the solutions you described) - We called them, and told the counselor what our accounts were, and how much we owed. He faxed us a proposed payment schedule based on how much Genus estimated they could negotiate our cards down. They then sent proposals to all our creditors, and all but one accepted. No more late fees - no more phone calls - no more punative interest rates (one card was in the high 20's, because of multiple late pays - most lowered to <6%). We then adjusted our plan, based on the amounts negotiated.

We set up an automatic debit from our checking account. The first few months were a little discouraging - a well is always scarier from the bottom - but over time, we learned to budget, and came to look forward to the CC statements with gradually diminishing balances.

What did it cost? $4.00 per payment per account. So in the beginning, we were paying Genus $20 a month on five accounts. When a card is paid off, the fee goes down $4.00.

We had to stop using our cards. We had to stop applying for cards. We had to stop reading the offers and listening to the phone calls. We had to take better care of our car. We had to buy groceries more carefully. We spent money according to a plan - not just until it was gone.

We found other services that do this -CCCS is the original, I think. We found services that do something like this, but charge a lot more money. Then we found services that pretend to do this, but actually just lend you more money.

I learned to treat debt like an addiction. That's why I could never make borrowing to pay bills work. I wasn't solving the problem - I was just feeding the monster - the one who told me I could have what I wanted without consequences. The one who tells an addict to have just one drink, smoke, lap dance, hand of black-jack, orer of fries, etc, and everything will be all right.

Getting out of debt is getting sober. I had to learn to stop sticking the Visa card in my arm every time life got hard.

Too late for more sermonizing tonight. I don't work for these people, and have no interest in their success or failure as an organization - except for gratitude. They helped me pay my bills, and they helped me find some perspective.

Maybe they can help you too.

Peace,
bob

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Author: markup123 One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131484 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 1:11 AM
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Bravo and kudos to all on this board who have gotten rid of their credit card debt. Here's hoping you stay out it forever.

For my part, I am jealous as hell. I too am caught in the credit card debt trap. Not because of my charges, but because of my wife's. Her cards have been paid off several times using savings (now largely depleted; I don't even want to say how much). Plus I have refinanced the mortgage twice to pay off her cards ($67K total). Each time the cards are paid off the result is only to run up the balance again, so I'm reluctant to refinance again or roll the balances over onto lower interest cards.

The last payoff was 8 months ago. Current balance is already up to $30K. I started to think it was better to have the cards maxed out; at least nothing more could be charged. But the card companies keep raising the credit limit!!

My better half absolutely refuses to spend less. Says instead that I need to earn more than the $100K I already make. Of course this is easier said than done, and to me there is no point in earning any more. If you spend more than you bring in you will never get ahead, no matter how high your salary.

I know all this may sound like I'm a weak husband and the obvious response is "cut up her credit cards!" For one thing, she's had these cards since before we were married, my name is not on them, and our agreement was that she would keep them and be responsible for paying them. Admittedly, that does not seem to be working. Secondly, I think she would just request new cards and get them.

I am at my wits end. This board is all about coming to grips with debt and spending habits. How do you convince someone ELSE to do so?



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Author: Stockbuyer2 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131485 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 3:09 AM
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markup123

OUCH!!!!

I assume that since you have put up with her spending for this long that you must really love and care for her. That being said, do you save for your retirement? Do you have an efund? If these things are NOT possible while paying on your wife's debt, she agreed to be responsible for the charges, the best thing you can do is separate your money and finances from hers. She's walking a very thin line. Maybe it's time to try some tough love. LET HER BE RESPONSIBLE FOR HER OWN DEBTS. DO NOT BAIL HER OUT. I think that spending like that is a sickness like alcoholism and until she admits that she has a problem and wants to get clean you can't really help her.

Stockbuyer2

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Author: Fallout2Queen Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131489 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 7:54 AM
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My better half absolutely refuses to spend less. Says instead that I need to earn more than the $100K I already make. Of course this is easier said than done, and to me there is no point in earning any more. If you spend more than you bring in you will never get ahead, no matter how high your salary.

I know all this may sound like I'm a weak husband and the obvious response is "cut up her credit cards!" For one thing, she's had these cards since before we were married, my name is not on them, and our agreement was that she would keep them and be responsible for paying them. Admittedly, that does not seem to be working. Secondly, I think she would just request new cards and get them.

I am at my wits end. This board is all about coming to grips with debt and spending habits. How do you convince someone ELSE to do so?


It's not just about the money -- what about her blatant disregard for your feelings? Line Dear Abby/Ann Landers would say: Go to marriage counseling, and if she won't go with you, go alone.

If you haven't already done so, get a copy of your credit report to make sure she hasn't opened any joint accounts you aren't aware of, or taken out credit cards in your name. And you might want to put a fraud alert on your credit reports to prevent her from doing this. Sorry if I'm implying your wife might be dishonest, but other posters have had problems with spouses/friends/relatives misusing their credit info.

There are other posters here who can give you some more specific advice.



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Author: Fallout2Queen Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131490 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 7:55 AM
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It's not just about the money -- what about her blatant disregard for your feelings? Line Dear Abby/Ann Landers would say: Go to marriage counseling, and if she won't go with you, go alone.


Correcting the typo:
It's not just about the money -- what about her blatant disregard for your feelings? Like Dear Abby/Ann Landers would say: Go to marriage counseling, and if she won't go with you, go alone.


Sorry about that.

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Author: CristyneS Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131493 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 8:34 AM
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For one thing, she's had these cards since before we were married, my name is not on them, and our agreement was that she would keep them and be responsible for paying them. Admittedly, that does not seem to be working. Secondly, I think she would just request new cards and get them.
*********************************************************************

Sounds like she is a shop a holic (seriously). If they are only in her name. Stop paying them- your credit is reported separately. I think that is the only way she will learn. If you keep bailing her out- she WILL keep doing it.


CristyneS

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Author: Pennsyltuckian Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131517 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 5:10 PM
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<I am at my wits end. This board is all about coming to grips with debt and spending habits. How do you convince someone ELSE to do so?>

markup,

IMHO you have just described a classic co-depedent relationship. One partner feels compelled to engage in behavior that is self-destructive, escapist, and hurtful to the relationship -- the other partner feels resentful and trapped in a cycle of nagging, denying, posing (the "strong husband", man have I tried and failed to play that mythical role) and ultimately facing the cosequences that the addicted partner refuses to face.

It sounds like your marriage has much bigger issues to face than consumer debts. Mine did too. Until we got into counselling, and learned to understand WHY we were treating ourselves, and each other so badly, we didn't have a chance of dealing with our debts.

How many stories have you read on this board about people who got out of debt, the fell right back into the hole? Some of us are put into bad financial situations by circumstances or disasters. But some of us are engaged in the compulsive abuse of money and credit. Fixing the bills won't be enough. We need to learn to heal ourselves as well.

I believe that the unfortunate answer to your question is that you CAN"T change someone else - especially an addict. In our marriage, we came to the point where we had to decide - was our marriage about use and abuse, or was it about healing? Once we decided to try to stay married, each of us had to make commitments, to the shrink, to the medications, to the 12 step group, to the marriage counselor to the priest, to the spiritual director. We learned how to get well, and prosperity followed.

You are quite right whe you say "if you spend more than you bring in, you will never get ahead..." But if you don't understand what makes you spend more, and don't do anything about that root cause, you will never even get out of the starting gate.

'God, grant us the serenety to accept the things we cannot change
The courage to change the things we can
And the wisdom to know the difference"

Peace
bob



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Author: january1000 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131527 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 9:43 PM
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Thanks for your advice and support. I will go into detail and record my debts and interest rates. And I will try to let go of being hard on myself.

January

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Author: Booa Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 131537 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/22/2002 10:49 PM
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Sorry for you, markup123. Trying to deal with a spendy spouse has been the topic of many a thread on here. But it is really REALLY hard. Harder, I think, than dealing with one's own spendy tendencies. But as I think you already know, you can't outsave a spender. You can find 10 places to cut your budget, and your spouse takes one trip to the mall or Radio Shack and ffft it's gone. I don't think you sound like a weak husband, and I don't think there's an obvious response. I wish there was a magic wand you could wave and your wife would get a clue, but there isn't.

I guess you figured out, refinancing the house to pay the cards isn't working. You said these are her personal credit cards, where does the money come from to pay for them, do you pay for them? Does she work? Is there any way you can call the companies and ask them to freeze the limits? Can you sit her down and put both of you on a "fun money" allowance, so that you each have so much to spend a month and no more? (If both of you are doing it, that's more fair and she may be more inclined to listen to you.) Can you hide money from her? (I know that sounds terrible, but it may be what you have to do. I hide money from myself, otherwise I spend it, so I know that it works for me...)

Anyway, good luck and we'll be here rooting for you.


--Booa ("Hi, my name is Booa and I'm the spendy spouse in my house")

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Author: diave Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132130 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/27/2002 7:27 PM
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Hi Tamarian,

Thank you for your valuable comments -- much appreciated. I tried to respond to your email but kept getting bounced.

"Hi, diave. Boy, the dot.gone fiasco has really smarted, hasn't it? CSCO was a big old 'ouchie' in our portfolio, too. :("

I was a member of photon valley and truly believed in what we were doing to leap light-years forward. I also invested heavily there (as a true believer would do) and lost a bundle as did most everyone else unless they had the titles of CEO or CFO. :( However, my faith in the technology sector has yet to recover(terribly shaken by the Arthur Anderson, Enron, Quest, WorldCom, NT, JDSU, LU, etc.) and won't until the checks and balances are in place and verified, and sufficient time has passed to gain some level of sobriety as well. ;-)

We seem to be repeating history a bit as well with our CC burnt fingers. My parents were children of the depression and their parents use of credit. We need to re-learn the valuable lessons they learned. It always amazed me how wisely they saved and used money, and they never used credit (except for their mortgage which they joyfully celebrated when it was satisfied). They paid cash or went without. They bought used cars for cash until they could pay cash for new ones. They hah a saving frenzy and I was amazed with the estate they acquired through paying themselves first. I got hooked on CC through a friendly green amex (discussed later).

However, true reality caught up with me, in May 99, when I found myself in the local cardiac ward being shocked back into life. Since then I have made good progress restoring my physical and mental health (meditation and daily 5 mile walks accomplish amazing wonders). For the past year (since 06.01.01) I have been focused on restoring my financial health (which, I am finding, to be a much tougher task ;-).

"If you haven't done this already or lately, track every single penny you spend, right down to the quarters in your pocket. Seriously. Not forever, but say for a couple weeks or so."

This morning I started tracking my spending, as you suggest, and I will do so for several weeks. I set-up a budget (back in 2001) that is based on the previous quarterly run-rates and re-visit twice yearly to revise . However, it is not as tight as it should be and things do fall through the cracks. Like when I recently re-visited my CC spreadsheets and discovered a major outage. I had not linked (monthly, as with the revolving accounts) the use of my Amex green card (when used it was paid off the following month, and recorded). When linked it was shocking to learn both of the happiness usage (dinners out, birthdays, etc.) and the $$ lost. As mentioned earlier, the Amex green was my first credit card and I have grown attached to it (but I am going to cancel it, since it is much too tempting of a decision choice point to use causually and not wisely). I will create an e-fund as well.

Thanks again, Diave
PS: I have found "baby steps" to be a very effective change agent. I am a member on another great web site where "baby steps" are the operative norm (and the only accepted norm as well :-).


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Author: TamarianG Big red star, 1000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132164 of 308470
Subject: Re: I would like to thank the entire board... Date: 6/28/2002 10:10 AM
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Thank you for your valuable comments -- much appreciated. I tried to respond to your email but kept getting bounced.

Yikes - thanks for the heads up! I'm having a lot of trouble with Bigfoot, actually - looks like it's time to change over to something else. BLECH!

PS: I have found "baby steps" to be a very effective change agent. I am a member on another great web site where "baby steps" are the operative norm (and the only accepted norm as well :-).

Wouldn't happen to be the Flylady, by any chance? I'm a new member over there myself...I have this wild fantasy that someday, I might be able to see the carpet in my front room again... 8^D

Onward!
Tamarian

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Author: newfool115 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132373 of 308470
Subject: Re: I would like to thank the entire board... Date: 7/1/2002 3:06 PM
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I'm just curious -- for those of you who are writing checks against your credit cards even as you charge them up -- why do you use a credit card at all? Why don't you just use cash?

If it's the convenience of a card you want, why not use a debit card? If you are worried that your debit card transactions are "invisible", compared to a checkbook, sign up for home banking (web-based) with your bank. Most of my debits come through the day I make them. I pay all my bills through the home banking, also. So I always know pretty much where I am in my balance. Plus, my home banking setup lets me review my transactions in various ways (by date, payee, etc) and import them into home accounting software.

I use my credit card on major purchases to get the double-warranty benefit, but only after I already have the money set aside for the purchase.

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Author: Catleen Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132379 of 308470
Subject: Re: I would like to thank the entire board... Date: 7/1/2002 4:10 PM
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Let me chime in here. For me when I use a credit card, especially for a large purchase I always have the money in my account. I used the credit card for the dispute factor.

Suppose I buy a clothes dryer and it is defective. The dispute enables it to be resolved quickly and with little difficulty.

That is the only reason I use a credit card.

Catleen

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Author: NaggingFool Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132380 of 308470
Subject: Re: I would like to thank the entire board... Date: 7/1/2002 4:19 PM
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I'm just curious -- for those of you who are writing checks against your credit cards even as you charge them up -- why do you use a credit card at all? Why don't you just use cash?

I don't use checks to track my credit card spending, but I do enter all of my credit card transactions into my check register on my PDA, and pay the bill in full every month.

Here are the reasons I use a credit card:
- the 1-2% cash back (I should really get a farm bureau card)
- the extended warrenties, rental car insurance, dispute procedures
- the convenience-- fewer atm trips, less cash to carry around
- the float

-Megan


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Author: diave Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 132416 of 308470
Subject: Re: I would like to thank the entire board... Date: 7/1/2002 11:34 PM
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"Wouldn't happen to be the Flylady, by any chance?"

Hi Tamarian,

Yes. http://www.FlyLady.net is very helpful. I am a flyguy who is baby stepping his way through the hot spots. ;-)

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