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Author: SeeFoolRun Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308411  
Subject: Re: Starting Again - Debt Elimination Date: 6/23/2007 6:11 PM
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You probably didn't end up with $36k CC debt in one year so don't feel bad that it won't be paid off in 1 yr. It took time to create it & will take time to get rid of it. Understand it can be a long process but there's light at the end of the tunnel.

Not being insulting so don't read it this way: You sound like you don't have the discipline or desire to change your spending habits. You want the debt eliminated but don't want to sacrifice anything in your standard of living to male that happen.

That's ok - many people are like that, just understand it will take longer and plan for that so you're not discouraged 6 months into a 6 year plan.

You can keep your current standard of living and get that paid off eventually. BUT you have to stop using the cards to subsidize your paychecks or cover unplanned emergencies. Put them up, manage to the cash you have coming in every check, and understand it will take years to get out from under it completely.

Unless you are going to really overhaul your spending and savings plans, I don't see anything else working for right now. Start small & see what extra you can free up for (1) short-term savings (e-fund) & (2) additional debt repayments. Maybe over the next months you only free up $100 so $50 gets saved & $50 goes as extra toward CCs. Celebrate that - don't be discouraged that it was ONLY $100 - every little bit helps. Then you can build on that encouraging achievement and maybe free up an additional $50 the next month & so on. Think baby steps.

Obvious things from your budget that kind of stand out in addition to what you pointed out:

* Car insurance - looks high, but you might be driving expensive vehicles, insuring a teenager, or have some tickets. Might want to shop around & see if you can beat that. $2100+/year to insure 2 cars sounds a little high.

* Phone, internet, & satellite. $230. Getting a package deal for all 3 from one provider might save a lot here. Ours is around $150 for all 3 thru cable company w/ fastest internet service, 3 premium channels, & some other bells & whistles. I see introductory ads from phone & cable companies starting at $100-$129/mo for all 3 all the time. Might want to check out vonage, skype, etc for Cuba calls - maybe you can find a deal.

* $700 for groceries + Hhold misc. Unless you have a big family, that sounds a little high.

Might also want to track that misc cash from the ATM. Are you sure you know where it's going? When I don't feel like taking lunch, drinks, & snacks to work & eat in the cafeteria instead I see huge spikes in ATM cash spending. It's that discipline thing (I'm as guilty as you are here). Just drinks from the machine & lunches & snacks add up to >$50/week before you know it. When i stick to my plan of carrying in lunch/drinks/snacks I see a lot more money "left over" than when i don't. Funny thing is, I prefer what I take in vs what I buy there, but I either forget or don't want to be bothered sometimes.

Bottom line is you have to weigh your priorities. Is it more important to have the cleaning service or have $200 extra for savings & debt? You need to ask that about each non-necessity & answer honestly. If you find things that save time or make you feel life is that much more enjoyable win, so be it. If paying off the debt quickly is truly not more important to you than the morning latte no plan that puts paying off debt in front of lattes will work. Just understand that some people prioritize debt as #1 and go after it very aggressively. Some people don't. Find out where it fits in your priorities & plan accordingly. No matter where it falls, divert extra amounts you free up to your saving/repayment plan immediately. That way what you free up doesn't get spent in a different category.
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