Is anybody else trying to do something about their debt?

Miscellaneous and Personal Stuff I Must Share
1

I never really know what’s MPSIMS and what’s IMHO - I guess this is MPSIMS because literally none of you give a rat’s ass about my Discover card.

So our consumer debt has… snuck up. It’s always just a leeeetle bit more than we pay, and before you know it we’re looking around and realizing we rob Peter to pay Paul all the time and that we’re right at, uh, pretty much all our limits. And we just recently bought a car (we’d never had a car payment before) with the intention, and the ability, of paying it off within a few months… but looking at it, damn, if we can do that, we really ought to not do that and instead do everything.

I read the Dave Ramsey books, and while I know people argue with his “debt snowball” it pretty much works out to six of one vs. half a dozen of the other for us, since from smallest to largest most of the smaller debts are credit cards.

The thing is, I honestly don’t think we’re ready to approach this with the “gazelle like focus” it really requires. I am not really willing to get a second job, which would mean spending less time with our son. I AM willing to finally have that giant garage sale, but I don’t think I can suck it up and sell the Mustang my dad gave me now that he’s gone even though we never drive it. And I’m definitely not willing to get rid of the new car, because the reasons we decided to buy it are perfectly valid.

So unless my husband actually gets this better paying job he has an interview for (I have all of my toes crossed) there’s really not a lot to start putting towards debt, which in and of itself is pretty terrifying - we’ve sort of blindly gotten ourselves into a spot where just paying the minimum on stuff and feeding ourselves means we’re up against it! Well that’s not cool. And we don’t really have a ton of places we can cut back - I know suggesting we downgrade phones is a nonstarter with my husband, we don’t go out much, we don’t have cable - the only two areas I can see a lot of wiggle in are that we eat out a little too much and we buy way too much booze. It might be possible to be cheaper with the heat this winter, although that’s a bit tough with a baby who won’t keep a blanket on, but that takes a while to take effect because we do budgeted billing for our electrical bill.

I’ve already gone through and gotten us a way better deal on our car insurance (I can’t believe I was leaving that money on the table with State Farm) and gone over all our bills making sure there’s not stuff we’re paying for that we don’t use. We’re expecting a couple thousand at least from selling my old car (a family friend is brokering it for us and it’s taking longer than he expected) and we get a pretty good tax return, which I know is theoretically bad but frankly is going to be good for us to be able to put a big chunk down at once this February and maybe free us up a bit and jump start us.

I dunno, the whole thing is just depressing. I hate even thinking about it, which I know is how we got into this mess. Even if we didn’t have to do it now, this is probably the best time to do it - before the baby gets old enough to want things or need stuff for school or anything. It’s just… ugh. Don’t wanna.

Is anybody else going through the same thing, or has been through the same thing?

2

I have no debt (with what, by whom & whose laws). I should not have to be bothered by anything, neither morally nor legally.

3

The very best of luck to you.

Booze is probably both the easiest and most difficult to cut back: you’ll find out your true relationship with it. Would it really kill you to not eat out at all for a while? No take-aways or fast food either. Cutting back on heating is also easy: just put on an extra jumper and thicker underwear and tuck the baby in tighter. People survived millennia without central heating; you can do it too.

4

Been through it. It’s kids that do it to you because you can’t cut back on them to save money.

Sorry about your Mustang, you have to sell it. And you probably won’t get as much for it as you thought either. If you hardly drive it then you don’t need it, and your insurance will go down and you won’t have to pay for registering and inspecting it every year. What you get for that can knock down a credit card balance and start saving you money immediately. You have to refinance everything you can and cut any expense that is not an absolute necessity. You don’t get through this in a hurry, it can take years, but the sooner you start and the more that you sacrifice the sooner you will get through this. And trust me, you will be glad you did it when you’re done.

5

Suze Orman used to say that you need to get as much pleasure from saving as you do from spending. I know it’s difficult, but it’s a matter of changing your mindset. You have to celebrate things like selling the Mustang or spending less on food and drink as positive choices that will allow you to live a better, more secure life.

I reorganized my personal finances and set up my budget five years ago. It’s an ongoing process, but I really feel good about where I am now, and I get great pleasure from looking at my savings and retirement accounts. For the most part, I am also able to feel good when I have to say no to spending money on something (sometimes it takes a while to work through the “I need to have that” desire and get to the “I’m better off without it” stage). It sounds like you aren’t yet able to truly separate your wants from your needs.

There are two books that I recommend that were the most helpful to me in putting together my plan:

All Your Worth: The Ultimate Lifetime Money Plan by Elizabeth Warren
Debt-Free Forever: Take Control of Your Money and Your Life by Gail Vaz-Oxlade

It sounds like you know what you need to do, you just need to get to the mental place where you can do it. Don’t think of it as depressing, think of it as exciting – you’re building a better life for yourself and your child.

6

Honestly, in reading your OP, what I see you saying is you’re quickly sinking into debt, but you’re not yet ready to cut back on booze, eating out, or an overly expensive cell phone plan.

I repeat: You say you’re quickly sinking into debt, but you’re not ready to cut back on booze, eating out, or an overly expensive cell phone plan.

You have to change your priorities.

Take a serious look at your food/beverage budget. How much do you really spend on eating out? (I found I was spending a lot more on it than I’d been assuming - tax and tip really add up.) How much do you spend on groceries? (You can save a boatload by cutting back on meat and eating more beans. Do you buy lunch out or pack your own? Buy lattes? Those add up really fast!) And booze? Seriously? If you don’t sit down and add it all up, you’re not likely to make any real changes. **You’ll likely find you can save a few hundred a month in the food/beverage department. **Crockpot and pressure cooker should become your best friends if you’re not up for cooking every night. Always make enough for more than one day’s dinner. Drink less booze and cheaper booze.

I don’t know if I read about it on SDMB or somewhere else, but a woman recently came up with a free downloadable cookbook called Good and Cheap (Eat Well For $4 a Day) of tasty, easy recipes, designed for people receiving food benefits, (but the recipes are useful for anybody). http://www.leannebrown.com/

Heating: Putting up clear plastic sheeting over windows for the winter really makes a huge difference in heating bills if you have older single pane windows. I have no more ideas in this area, other than to agree with the above poster about putting the baby in warmer sleeping clothes and wearing a sweater at home.

The phone thing - your husband won’t consider downgrading? Maybe if you find a reasonable prepaid plan with a cool phone online to show him he’d be more willing to reconsider. There are Virgin Mobile 4G phone plans for $45/mo, now with unlimited data for music streaming. There are several other companies to choose from that also look really good.

One thought - are you able to babysit someone else’s baby in the evening? Watching 2 isn’t a lot more work than 1. Even if it’s just 1 or 2 nights a week, it’s time you’d be home watching a baby anyways. And you wouldn’t be able to drink booze during those hours, which would save money there. :slight_smile:

Good luck. I’ve had to make drastic changes myself, some that I *really *don’t like, but it’s been worth it for the peace of mind.

7

I’ve had good results with YNAB. Budgeting my money by itself has really helped. Looking at the budget and seeing that I’ve already spent $20 if my $30 per month snacking budget helps me to hold off buying that bag of chips. The system is also flexible enough that you can rebudget on the fly in case of unforseen circumstances. Hell , just by moving my budgeting from bi-weekly to monthly has given me an extra $600 every four months. I used that to save up a bit of a buffer and now dump it on my debts.

8

We’re actually doing fine on the grocery budget except for beer and wine - I cook a lot, and while unfortunately my husband can’t eat a lot of the Cheap Eatin’ staples (no beans, no pasta, argh) I do okay on that front. Not that there’s absolutely no fat to cut on the grocery front, but that’s not the fertile area it is for a lot of people’s budgets. (Except for the booze, previously mentioned.)

So unfortunately we do not have “a few hundred” in the grocery budget to find. We do in the eating out budget, maybe $150-180ish a month. So that’s something, although it’s also something we really enjoy.

I’m going to start using cash envelopes for grocery and restaurants, though.

9

Argh, I just looked at the linked cookbook and it drives me nuts because he just can’t eat the majority of it and it all looks really good. He can’t have corn, he won’t eat eggs, no wheat, no beans, not much dairy. If anybody else is looking for stuff I used to do Cook for Good before I met him, which now has a cookbook “Wildly Affordable Organic” which has great shopping plans to eat for practically nothing… only it’s all baking your own bread and such, and that just doesn’t help us. I mean, that doesn’t mean we eat a bunch of lobster and filet mignon, but it does end up being incredibly frustrating that I can’t cook the way I’d actually like to cook for us.

10

I’m ~$700k in debt through virtually no fault of my own. Almost every dime I’ve made over the past 30 years is in the pocket of attorneys. I currently have a new crop of 3 attorneys on retainer: foreclosure, bankruptcy and family law (to fight a frivolous custody modification motion filed by a sociopathic ex.). I could use a forth attorney for another case, but I’m going pro se on that one.

I’m not a big fan of attorneys (prosecution or defense), although they seem to like me…a little too much. I didn’t even like them when I was in medical school and shared the dorm with law students (they always cheated in poker).

But, I still have my kids (and make sure they’re safe, happy and provided for) and my sense of humor, so things could be worse.

11

northpolarbear, I’ve read these sentences several times and still can’t make heads nor tails of what you’re trying to say. Can you elaborate a bit? :confused:

12

About the time I retired, we did some serious looking at our life and our expenses. We decided what was important and what wasn’t. Some of the steps we took:

[ul]
[li]Sold a car - we didn’t need 3 vehicles any longer[/li][li]Dropped to the second-lowest tier on cable and got Netflix[/li][li]Replaced our $100/month phone plan with pay-as-you-go phones - now we pay less than $300 per year.[/li][li]Got rid of our land line[/li][li]Ate out less often[/li][/ul]
Now that I’ve gone back to work, we’ve bumped our cable up again, and we’ll probably eat out more, but we severely reduced our expenditures, so we were able to get rid of everything but our mortgage and our utilities. And I intend to save the lion’s share of what I’ll be making for the next couple of years, then I’ll retire for reals.

13

I don’t cook, but I’m willing to bet that if you started a thread that listed what your husband can and can’t eat, and asked for ways to meet his needs on a budget, you’d be inundated with helpful suggestions and recipes.

If you want to get serious about tackling your debt, you really need to start separating your wants from your needs. Just because you really enjoy something doesn’t make it a need.

14

No cable…I work so can’t justify the expense of cable when I only get maybe an hour of TV per night! Would rather just watch the news.

Food: eat fresh and eat out less. Interesting chat with my daughter today who was whingeing about her little boys eating a whole packet of cashew nuts in one go. They cost $6! So I reminded her of the two packs of sugary mini donuts they scarfed down at the Sunday Market that cost $7.50…:smiley:

Sell the bloody car. It’s a liability not an asset. Use any proceeds to cut down your cc debt.

Speaking of cc debt, I don’t know about the US, but the cc interest rates in Aus are off the planet! I had a cc with a relatively low limit ($4.5k) and had a couple of years where I used it to pay for a whole shitload of medical stuff yada yada. And even though I was paying it off religiously, couldn’t seem to get on top of it!

In Aus, the govt has now made it compulsory for the banks to let their cc customers know the full extent of their debt. I have now cut up my card and payed it out, but just prior to that, I had a notice that: "If you only pay the minimum required payment each month AND don’t make any more debits, it will take you 34.7 years to clear the balance to $0. WTF? My balance at that point was only $4k (give or take a few dollars) Far out! :frowning:

Also, downsize your phone stuff. Get a prepaid plan…it teaches you to be careful about who you ring or text.

And I second those who suggest writing a log about exactly how much you spend. It’s an interesting exercise, because much of our consumerism is essentially unconscious. The $4.00 for a coffee, or the $10 for the funky jumper on sale…it adds up and up. People normally do their budget only considering the ‘regular’ outgoings, but it’s the irregular ones that can have the biggest impact.

Oh, and good luck!! :slight_smile:

15

I really suggest you get onto this NOW because kids expenses only go up.

Your not the first family to have to sell a prized car. Also look around your house. Maybe you have something else to sell like artwork, antiques, old collections, musical instruments, maybe even jewelry.

16

I’ve never carried as much debt as I do now, all because our boiler went kaput last winter before the blizzards and I had no choice except to put it on on a credit card.

Want to ramp my anxiety? Let’s talk finances.

I’m house poor but we live here because my mother paid it off years before the dementia (it’s in my name only). It’s also LOCATION LOCATION LOCATION :slight_smile: If we were to move – and yes we’ve discussed it – we’d have to move very far from my job in order to afford something. My husband mostly telecommutes; I refuse to drive over an hour one way to my job, although I have coworkers who do exactly that (right now I’m roughly 15-20 minutes barring traffic). I’m not earning the big bucks to justify a long commute, IMO.

I just bought a car because my Jeep finally died. It’s small, very fuel efficient, and it’s a payment I can comfortably afford.

My husband is the budgeter. I am in the keep=it-in-my-head kind of way in that spread sheets don’t register with me. I know, for example, how much we pay monthly for non-negotiables like utilities. I keep our weekly grocery budget under a certain amount unless I need to restock the pantry, which isn’t often. What’s probably killing us now are our work schedules: We work opposite; my husband isn’t much of a cook and it’s the last thing I want to do when I come home, so more often than not we grab a bite, whether it’s sit down or take out. The good thing is that we always save enough for another meal.

We have two dogs. Their main expense when neither of them are sick are their food.

My SIL has a saying: “It’s only money. You’re going to ALWAYS have some kind of debt so you might as well make peace with it.” Easy for her to say because she married well and has nothing to worry about; OTOH I understand what she’s saying. But still.

17

Zsofia, I’ve been there and it is miserable, especially in the long run up to admitting you’re on an unsustainable course.

The thing about keeping a car for sentimental value smacked me in the face, as I see it did a few others. I had my father’s wedding ring (until burglars got it) and still have his Navy coat, some wrenches and other tools. I understand sentimentality. But cars aren’t for sentimentality, they’re for being engaged as an adult citizen and keeping a job.

Enjoying seriously improving your situation, enjoying reducing your debt, sounds like fantastic advice.

You don’t have a choice about cutting back. You do have a choice about being able to decide how to do it, versus having mean nasty intruders break into your life and do it for you. Leaving debt out of control when you’re employed and healthy is how you set the stage for becoming homeless when those things happen to change.

I’m excited about having my mortgage and home equity loan paid off within about a year and not having any credit card or other unsecured debt, but I kind of have to do that as I only have several more years work left in me. I’m scared when I hear about people my age without significant savings and, worse still, with significant credit card debt. You definitely have my sympathy. I hope you find your way out of that dark land! and am glad you’re looking!

18

I just had a “OMG! How did my balances get so high!!!” moment a month or so ago. Some of it has been due to a family issue and vet bills, but most of it has been due to my lack of diligence. Too many lunches bought out, not enough cooking and taking leftovers. A few too many “I am hungry now” rather than waiting 30 minutes until I get home to eat.
Much like losing weight, this is a pretty straight forward equation. Spend less and/or get more money.
Depending on where you are located, yard sale season may be over. But for larger ticket items, Craigslist or Facebook yard sale groups, can be an option all winter. Clothes tend to do best as “bag of 2T summer clothes” rather than by item. I also recommend selling the spare car because if you aren’t driving it, the car will actually break down faster than if you were driving it. Like others suggesting, babysitting for a neighbor or two every once in a while can bring in a spare $40 every few weeks without you having to give up time with your own kid. Also, check your credit cards to see if they have bonus programs with them. One of my cards requires that I request that my bonus be paid out and rather than opting for a check, I have it applied directly to my balance.
Consider smaller ways to save on utilities. Since you are on a budgeting plan, it won’t show up for a few months, but that will save money in the long run. I haven’t turned on my heat yet, but rather than freeze, I am using a space heater near my couch, until the overall temp in my house drops to below 60. At that point I will turn on the central heat at 65. Blankets and fleece keep me warm. For the kid who won’t keep his blanket on, he can wear flannel PJs. If you are big readers, make sure you are utilizing your library, even for e-books.

19

The single most important thing is to get your husband’s buy in. My wife tends to get ‘down’ when we discuss budget troubles, so it’s hard to have a real conversation about it. The biggest thing we did was cut the cable, which you already did, cut back on cell phone, which you can do without your husband. The pay as you go companies now offer support for fancier phones, which might be up your alley.

The booze and eating out will be the quickest way to make progress, but he needs to agree. You may enjoy going out once a month instead of once a week, and make it extra special for yourselves.

20

I don’t think you’ll find the answer in a book, but I imagine some may have some good advice in them. There really isn’t a magic formula though, just common sense stuff, and willing to do things differently if it isn’t working for you now. Learn to avoid the big financial blunders. Seems like you’re doing quite a bit of things right already from what I can tell, and a few things you can work on. If your food budget is only $150-$180 a month, that’s pretty good for three. This is the budget without eating out? How much is spent on that aspect? You mention the alcohol a few times, without elaborating much. You don’t have to post the number, but ask yourself how much is really going to that? Hopefully, what drinking you two do, is at least done at the house. Bars can get expensive quick if it is a habit. Alcohol doesn’t help much in the judgment department either.

You don’t have cable, which I think it a good choice, hopefully you don’t have dish either. I’ve never had that, thought about Netflix, but I just don’t spend that much time in front of the TV myself. You mention wanting to keep the Mustang because you got it from your dad and is gone now, but I think your dad would want you to sell it since you’re not using it, anyway. Since you’ve already got the new car, I’d also recommend just keeping it now, and driving it till the wheels fall off, especially if it is an economical car. Also, have that garage sale.

Don’t put anything on the credit card that you can’t pay off entirely the next month. There were only a couple of times, I couldn’t do this in my life. You don’t need that ridiculous interest rate eating away at your hard earned money.

Reconsider phones and plans. I’m not sure you would need too much of a downgrade, but will probably be considerable on savings. I have a Samsung smart phone from Walmart that I buy a yearly card which comes out to $45.57 a month which uses the Verizon towers (options for ATT too) but on the Straight Talk plan. Of course, there are even much cheaper phones and plans.

With a kid, I’m not sure I’d recommend a second job for you. But what about your husband? Even if he gets a pay raise with his job he has now, hopefully he’ll find some other ways to make or save more money. One of the ways I got ahead was staying busy with extra work. Don’t need to do that now, but I did it for a good part of my life, and besides I like staying busy, still do. My dad did the same thing for a good part of his life too. We also did virtually all of our own home and car repairs. There wasn’t anything we wouldn’t tackle.

My parents lived in a 8’x22’ trailer they bought for the first five years of their lives and put it on their own lot. While everybody else was going in debt up to their neck, they toughed it out, and then paid cash for their first real home after the trailer. They never looked back. They accumulated quite a fortune, and never had high paying jobs during any of this time. I learned a lot from them, and much of this is how well you save and manage what little you do make. At age 23, I paid cash for a two year old home that was an arson case I picked up very cheap. Fixed it up, while unemployed.

Much of your answers can be solved by you and your husband if you’re on the same page. Are you? There are sacrifices and things you can do now which will prevent you from making some serious sacrifices later on in my life where you may no longer even have the luxury and option of having that choice. So keep working on it. You can look back many, many years later, and be glad you did.