Finances - Debt

  • Posted by a hidden member.
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    May 17, 2011 11:02 PM GMT
    Does anyone have any debt stories/experiences to share and how you got through or what you did to fix or better your financial situation? Always open to hear ideas of saving money and manage a decent living.
  • Posted by a hidden member.
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    May 17, 2011 11:07 PM GMT
    Change your phone number. It really cuts down on those pesky collector calls!
  • Posted by a hidden member.
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    May 18, 2011 2:14 AM GMT
    in2muscle2010 saidAlways open to hear ideas of saving money and manage a decent living.
    To save money, don't spend it.
    To manage a decent living, you must first make one.
    I'll get back to you when I figure out how. icon_razz.gif
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    May 18, 2011 2:21 AM GMT
    I stayed home with my son for six years and really only worked close to full-time (working freelance) for the last two. And I lived stupidly, still spending money like I was working full time and putting stuff on credit cards.

    When I split with my ex, I suddenly has $38,000 of credit card debt. I got a debt consolidation loan and have spent the last four years paying it off. I only have two payments left to go!

    I think it's really hard to be gay and not go into debt. Especially in the 21st century, when you see people going on trips all the time and buying cars and going to great restaurants, etc. It's not always the same people doing these things but your brain thinks everyone else is doing more fun stuff than you.

    I have one credit card now that I only use for emergencies. I haven't used it in 8 months. I don't have the greatest clothes, but I don't look like a zombie from The Walking Dead.

    When I go to Target, I have a list. That's the hardest for me.

    I never ever will shop at Whole Foods again icon_smile.gif

    Same thing for Costco. I thought about joining, but it's just another place for me to say no. And you do save money on some things, but when you figure things out by the unit, some things are cheaper at a regular grocery store.

    It's all about living within your means -- and not trying to compete with other people. If other people have nicer stuff, either they work really hard or they are miring themselves in debt. Or they are making different choices from you.

    Live your life and spend your money wisely. Don't spend other people's money in your head.
  • Posted by a hidden member.
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    May 18, 2011 2:29 AM GMT
    Trollileo said
    paulflexes said
    in2muscle2010 saidAlways open to hear ideas of saving money and manage a decent living.
    To save money, don't spend it.
    To manage a decent living, you must first make one.
    I'll get back to you when I figure out how. icon_razz.gif
    Prostitution. Duh.
    And porn.
  • Posted by a hidden member.
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    May 18, 2011 2:32 AM GMT
    Uff! no good stories from me, good thread BTW. Will stick around for the financial advice.
  • Posted by a hidden member.
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    May 18, 2011 2:41 AM GMT
    Don't spend more than you make. Pretty simple.
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    May 18, 2011 2:54 AM GMT
    I think it is a mindset thing. Don't spend money before you have it (even if it promised to you or supposedly in the mail). Live within your means.

    I had to change my spending habits quite drastically when I stopped working and went back to school. However, that meant that I was still in pretty good shape financially after that, in spite of having no income and only expenditure during that period.

    Yes, it is painful not being able to go to any restaurant you crave, or buy all sorts of stuff. However, I have found that I actually treasure my possessions more. icon_smile.gif
  • buckled

    Posts: 165

    May 18, 2011 3:06 AM GMT
    canuckguy19 saidDon't spend more than you make. Pretty simple.


    If it were that simple then no one would be in debt. I recently launched my website StudentFinancialAdvice.com that discusses this along many other topics. Although it's more tailored towards college students I think anyone could use some of the articles to benefit them.

    I realize I only have 4 articles up at the moment, but I will be posting about 2 a week (new one will be up tomorrow).

    A huge factor of finance is the psychology of money and I think people neglect that a lot of times... for instance the quoted comment. Americans wouldn't be in debt if money was strictly will power.

    I totally do agree with Canuck... but it's just not realistic advice, considering the people that follow it are few and far between.
  • Posted by a hidden member.
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    May 18, 2011 3:15 AM GMT
    I think it is also important to be realistic with any long-term commitments, such as student debt. What are you going to gain from the degree (or other qualification)? Will it enhance your chances of landing a job compared with what you have now (no brainer if you don't have much of other qualifications)?

    I say this because education is fast becoming a business, with many schools trying to sell programs just to meet their budgets. The sad fact is, some schools sell programs that they know have minimal value. After committing time and effort to study and the money involved, they may have little or no payback (it does not enhance your value as an employee). So it pays to do your research.
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    May 18, 2011 3:18 AM GMT
    Get rid of credit cards and credit card debt right away. Only keep one very basic Visa or MC not both then put it away for emergency use only. Get the lowest rate card available, the one with no rewards, no points, no nothing but a low rate. That's what I have.

    Learn the difference between wants and needs.

    Buy some things second hand. Who the hell is going to know it's second hand unless you tell them so don't unless you're proud of the great deal you got. For all those people who poo poo second hand ask them what they eat on and with what utensils when they dine at any restaurant. Yes, second hand plates, with second hand forks going in their mouths. . As them what they sleep on at a hotel.. second hand mattresses and bedding. That'll shut them up. You can find absolutely fantastic items second hand that have barely been used. For example I just bought a near new $800 Miele vacuum cleaner for the grand sum of $75 at the Habitat for Humanity Restore. Good stuff is out there for pennies on the dollar so cutting back on spending doesn't mean you have to cut back totally. That's just one example
  • buckled

    Posts: 165

    May 18, 2011 3:19 AM GMT
    @Outofthegrey's comment over schools

    Agreed! Time and time again you have people go into "XYZ Degree" for ... ?!
    They graduate, and realize that their humanities degree is going to get them nothing.

    I just don't understand it. You should go to school in order to achieve "XYZ JOB" Therefore, you choose the degree that will get you to that job. Not choose the degree because it sounds interesting and will be fun to study... even if it has zero job outlook.

  • buckled

    Posts: 165

    May 18, 2011 3:26 AM GMT
    5ebastian said

    For such a young kid, you have a great head on your shoulders. Finance major here and I really liked your input on frugality. I loved the definition...

    ^ genius. good for you.


    Thanks guy.. really appreciate the feedback. =)
  • Posted by a hidden member.
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    May 18, 2011 3:36 AM GMT
    buckled said
    canuckguy19 saidDon't spend more than you make. Pretty simple.


    If it were that simple then no one would be in debt. I recently launched my website StudentFinancialAdvice.com that discusses this along many other topics. Although it's more tailored towards college students I think anyone could use some of the articles to benefit them.

    I realize I only have 4 articles up at the moment, but I will be posting about 2 a week (new one will be up tomorrow).

    A huge factor of finance is the psychology of money and I think people neglect that a lot of times... for instance the quoted comment. Americans wouldn't be in debt if money was strictly will power.

    I totally do agree with Canuck... but it's just not realistic advice, considering the people that follow it are few and far between.


    It is that simple, whatever causes people to violate this principle is worthy of discussion, I agree.

    Debt incurred to sustain life, is not what I am talking about. It's debt to finance wants not needs that "don't spend more than you make" refers to in my mind. I fortunately have never had to worry about money, but see the principle violated by my peers daily, and wonder at how they are stretched financially when I know they make by most comparisons very healthy salaries.

  • buckled

    Posts: 165

    May 18, 2011 3:42 AM GMT
    canuckguy19 said

    It is that simple, whatever causes people to violate this principle is worthy of discussion, I agree.

    Debt incurred to sustain life, is not what I am talking about. It's debt to finance wants not needs that "don't spend more than you make" refers to in my mind. I fortunately have never had to worry about money, but see the principle violated by my peers daily, and wonder at how they are stretched financially when I know they make by most comparisons very healthy salaries.



    I definitely agree that the majority of people are bad at their finances. Point and case, your friends that make healthy salaries yet have financial strains. However, I was just saying that it's not really sound advice to say "spend less than what you make" because the majority of people will never follow that if simply being told.

    Same reason fat people are fat... they know if they eat less / eat the right stuff / exercise they will lose weight, but they don't.

    (Not arguing in this.. because you already cleared the need to discuss what causes people to violate the "spend less than you make" principle.. just bringing more to the table)
  • Posted by a hidden member.
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    May 18, 2011 3:53 AM GMT
    Financial Advice:

    Reiterating a few points

    Spend only a portion of your salary
    Develop a budget - easy to use and follow
    Discipline yourself - segregate an objective decision from a subjective decision
    Feelings and wants are not your best friends

    On the topic of college - who cares what you decide to study, but always have a hobby, learn it well, and market it. I studied political science, international relations, african studies, and minored in French; however, I worked in architecture since I was 16. Do I know numbers, budgets, and finance well, you better believe it.

    A good book I recommend to young people or individuals starting off, the Wall Street Guide to Understanding Money and Investing and check out bankrate.com.

    Debt Pointers
    Evaluate your finances first (always difficult to do)
    Speak to all debtors, including credit card companies.
    Lower your interest rates. Keep calling until you speak to a manager and demand they lower your interest rate. If you keep calling every day several times a day, they DO lower your rate.
    Create a spending chart - If you spend often, write down every receipt and total, then review it at the end of every week. You'll see where your money goes and does not go.
    Review your current spending - is your cell phone bill too high? Do you waste food?. etc

    Focus on increasing your wealth
    FInd a new job in a sector your can promote based on your skills? Find alternative types of work, or get a second job if necessary....

    Hope this helps.
    Mike
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    May 18, 2011 3:56 AM GMT
    I think many fall for the trap of advertising and marketing, saying that you should treat yourself since you've been working so hard. The issue is not whether you work hard or deserve it, but whether you can afford it.
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    May 18, 2011 3:58 AM GMT
    One final thing:

    living in high net worth areas with high taxes and rents....

    unlike other portions of the United States, these areas tend to have a higher proportion of people in debt. These rules still apply.

    Stay away from the hype and people who spend just to spend. Washington, DC is an expensive area, even for people making six figures. There is a different between the man who spend $100 on a bottle of wine and one who spends $13 dollars. I rarely go out to dinner and consistently save in Roth IRA, mutual funds, 401Ks, stocks, bonds, and such.

    Remember: Ever person who has money has had financial distress at some point in their lives.

    Best,

    Mike
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    May 18, 2011 4:04 AM GMT
    I have taught this to most every 'troop' I have had through the years and to all my friends and family.
    Its very very simple.

    Create two columns. One is 'WANT', the other is 'NEED'.
    Every dollar you spend must be rectified honestly by one of the columns.
    When the 'need' column consumes all or most of your income, there better be no spending in the 'want' column.

    Additionally, savings is a 'want' column item!
    When you balance your spending decision making with those two columns, you'll be surprised on how little 'debt' you actually have!
  • Bigolbear

    Posts: 528

    May 18, 2011 4:15 AM GMT
    Make higher interest debt your first priority.

    Live well within your means even if it means you do less and have less than your friends do.

    Take up a second job, or some small jobs, to pay off your debt and spend that money ONLY on your debt.

    Once you get in the black save until you have a half a years expenses as a buffer and then work on other long term steps to increase your income.

    I've been living in the black for years now with ZERO debt. The only time I occasionally use credit cards is to increase my FICO score and even that is planned out to the nines. If you don't use credit for too long it will drop your FICO and should you need it later, for a house or additional rental house, those points will save you. Every 6 months check all three of your reports and go over them with a fine toothed comb. If anything looks out of whack, contest it immediately.

    If your job offers a Flex Spending Account for medical then use it. It has saved me $800 this year already. It takes some planning and attention to detail and records but it's worth it. Also, audit your medical expenses. I saved about $420 this year by challenging a charge from a hospital that they said I owed. They are big on charging you "estimated costs of services" up front that DO NOT show up on your EOB later. If you don't know what an EOB is, and you have medical insurance, learn it.

    That's about all I got.
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    May 18, 2011 4:17 AM GMT
    Flex spending is great! If you have a great bill of health, you may not need it, but I agree with all points made....by bigolbear
  • ohioguy12

    Posts: 2024

    May 18, 2011 4:23 AM GMT
    mplsjock_writer said
    I think it's really hard to be gay and not go into debt.


    Is this true!?
  • Webster666

    Posts: 9217

    May 18, 2011 5:14 AM GMT
    I had my Ex work a lot of overtime and turn his paycheck over to me, so that I could pay off his ELEVEN credit cards.

    My best friend wracked up $70,000 in credit card debt.
    He got a book that explained all the steps to file for bankruptcy.
    He got it all wiped away.
    That was about 10 years ago.
    Now, they've got stricter bankruptcy rules.

    I borrowed from my retirement fund, for the down payment on my house.
    The payments, plus interest, went right back into my retirement fund.
    Good deal.
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    May 18, 2011 5:36 AM GMT
    I had to put myself through college so I used my credit card pretty often when I had to buy stuff like furniture, books and other essential stuff. I also had to pay rent a few times and to fix my car when it broke down. I had like $15k of credit card debit by the time I was done with school.

    After I was done with school and got a full time job I was able to slowly pay it down but never completely got rid of it. Its hard when the stupid interest keeps adding onto it. I found a job that paid for my rent and gave me a per diem everyday for half a year. I was also getting my regular salary. I was able to eliminate all of my credit card debit in 3 months and quickly built up a savings that I still add to and never had to touch for any reason.

    I use my credit card for purchases all the time now to get points but I pay it off before any interest is charged. It was a bitch to make the monthly payments only to realize that a huge chunk of it goes to the interest. No matter what I did I felt like I was never going to get out of the hole. It was a huge relief being able to pay off everything. I was fortunate to land the job.

    Before I got the job I was just cutting down my expenses and putting everything to my credit card payments. It seems like it was taking forever but it definitely was going down. Just really cut back on the spending.
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    May 18, 2011 5:43 AM GMT
    AvadaKedavra saidI had to put myself through college so I used my credit card pretty often when I had to buy stuff like furniture, books and other essential stuff. I also had to pay rent a few times and to fix my car when it broke down. I had like $15k of credit card debit by the time I was done with school.

    After I was done with school and got a full time job I was able to slowly pay it down but never completely got rid of it. Its hard when the stupid interest keeps adding onto it. I found a job that paid for my rent and gave me a per diem everyday for half a year. I was also getting my regular salary. I was able to eliminate all of my credit card debit in 3 months and quickly built up a savings that I still add to and never had to touch for any reason.

    I use my credit card for purchases all the time now to get points but I pay it off before any interest is charged. It was a bitch to make the monthly payments only to realize that a huge chunk of it goes to the interest. No matter what I did I felt like I was never going to get out of the hole. It was a huge relief being able to pay off everything. I was fortunate to land the job.

    Before I got the job I was just cutting down my expenses and putting everything to my credit card payments. It seems like it was taking forever but it definitely was going down. Just really cut back on the spending.


    omg so fiscally responsible.....IM gonna masturbate while I read this story over and over again. cool?