Archive results for “February 2007f 2007”

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Sharing a Quote from Another Blogger

Sometimes, other bloggers say things much better than I ever could. Here’s one of those instances, courtesy of Debt Tally.

“They upped our credit limit by $1500. Oh, those credit card companies and the tricks they play. But itâ€™s fine by me – widen the gap between the credit we use and the credit we have, and thatâ€™s ok by me â€” itâ€™ll up our credit score. But poo for you, oh Mr. Credit Card, because we wonâ€™t be going anywhere near the top end of that limit ever again!!”

“Poo for you” cracks me up!

Congrats on your progress Debt Tally!

Posted by Tricia on February 28, 2007 at 12:58 PM in Blogging Buddies, General Debt | 4 Comments »
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Reducing Debt – Where Did We Start?

I’ve been receiving some comments and emails asking where do you start when it comes to reducing debt so I thought I would write a post telling what we did.

First things first, we calculated the total damage. This is a sobering step, but once you finish it you have a better idea of where you stand. We listed all of our debts with columns for creditor, balance due, interest rate and minimum monthly payment. This can be done on the computer or with pencil and paper.

I also took a look at how much we were paying for finance charges. When I first started this blog, we were paying over $400/month in finance charges. That was $400 a month that we could have for other things in life if we didn’t have our credit cards. I used that as motivation.

Once you have all of your debts listed, there are two popular ways to start paying them off.

1.) List your debts from the highest interest rate to the lowest interest rate. Pay the minimum payment for all debts except for the one with the highest interest rate. That debt you pay as much as you can towards. Once that debt with the highest interest rate is paid off, you tackle the next debt in the list.

2.) List your debts from the smallest to the largest balance. Pay the minimum payment for all debts except for the one with the smallest balance. Pay as much as you can to that debt. Once that debt with the lowest balance is paid off, you takle the next debt in the list.

If you choose to go with #1, you will end up paying less interest in the long run because you are getting rid of the balances with the higher rates first. But sometimes the balance with the highest interest may be your largest balance. It may seem like its taking forever to get it paid off.

That’s the appeal of #2. By paying off the smaller balances first, you are seeing progress quickly by paying off entire balances. That can be a big boost to your self-esteem with your debt reduction plan.

For us, we are doing a combination of the two. For the most part, we have been tackling the debt with the highest rates but we have paid off other debts first. I think the main thing is to decide on a plan that works for you and you stick with it. Committment to becoming debt-free is a big factor. Without that, both of the plans above will not work.

I’ll talk about where my motivation comes from in a later post. I started making a list, and I am amazed where all I am pulling inspiration/motivation from.

Posted by Tricia on February 27, 2007 at 10:22 AM in General Debt, Reducing Debt | 19 Comments »
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Sharing a Reader’s Debt Story

Anytime that you, my readers, would like to share your debt story, feel free to send it to me in an email and I will post it on here. It’s not easy reading all of the stories, because there are so many people struggling. But with sharing our stories, we know that we are not alone. Debt can affect anyone.

“Eight years ago I had a hundred and fifty thousand bucks. Now I’m 25 thousand in high interest debt and struggling. To pay it off, I’ve allowed myself 10 dollars a day for food and gas, refuse to use the cards, use advances from work to handle emergencies.

What I did wrong: I bought a fixer-upper with a man who turned out to be a total flake. Then we had a baby. To get out of owning real estate with an unstable person, I lost my shirt on the house. With about $10,000 left, I moved back to Seattle with my son, got a job, enrolled him in preschool. The preschool was expensive, but child support helped us get by, until child support ended, and it looked like it would be gone for a very long time. Ran through the savings, started using the credit cards to pick up the slack. Just three more years til kindergarten, then I would stop with the credit cards. We were getting by until I was robbed, stalked, had to move to a different, even more expensive preschool, had to change apartments. This might have been manageable except that kindergarten isn’t as cheap as I thought.

So now I’m in debt, living day to day until I pay down this debt, which I calculate to be about a 5-year haul if I suck it in and keep to my $10 per day budget. When the lease on my apartment is over, I’m moving to a cheaper apartment (I moved to a more expensive one when I was running away from the stalker, not thinking straight because of fear.) I might even try living without a car.”

Thank you for sharing your story. I think yours is one that many can relate to…things were going well but then a series of unfortunate events created the spiral downward into debt. Which reminds me. There is a banner on the left hand side of my blog that will take you to Modest Needs. People can go there to apply for help with such expenses and others can go there to donate to help others. I support this organization 100% (take a look at their financials – they are very impressive).

Posted by Tricia on February 26, 2007 at 12:44 PM in General Debt | 7 Comments »
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Credit Card Debt Update = $22,192 / Savings Update = $1,122

I made one last minimum payment towards our credit cards today and that brings our credit card debt total to $22,192 for the end of February. I will not be paying any extra towards our debt for a while because it was decided that we should start agressively saving for a few months.

I have been holding onto some money in our checking account for some home repair. I have been having a horrible time getting a hold of the handiman that agreed to do the work so I have given up until the weather warms up. This weekend I took that money and put it into a savings account. I also took what I could from our checking account and shifted that over. If the money isn’t in our checking account, we are less likely to use it. With moving funds around, that brings our savings total to $1,122.

Basically, my husband’s temporary job is the major reason we are still able to pay large amounts to our debt and savings. While the length of the job has been extended, I am not sure exactly how long it will last. As a result, I am feeling rushed. I feel like we have to pay off as much as we can and save as much as we can ASAP.

Living on borrowed time. That’s how I feel right now. I don’t like this feeling, and I look forward to the day where the worry is no longer there. I know we will be at that point sometime in our lives, but of course I am human and I’d like that point to be right now.

Then again, I’ve been thinking about it and I’m not sure if I will ever be to the point where I no longer worry about money. Does that point exist???

Posted by Tricia on February 25, 2007 at 5:39 PM in Debt Updates | 11 Comments »
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Seven Credit Cards Aren’t Enough. How About 1,497?

I have 7 credit cards and sometimes I think that is too many. Even though we only use/have balances on four of them, it’s still some work to make sure everything is a-ok on the cards and there are no fradulent charges.

I couldn’t imagine adding 1,490 credit cards to my wallet like this man has done. The article is older, so he very well could have more cards today:

Man Has 1,497 Credit Cards

What I find so fascinating about this story is that Walter Cavanagh has a total of 1.7 million dollars in available credit yet he has a stellar credit report. He uses one of his cards and pays off the balance in full monthly.

1.7 million dollars in available credit…wow.

[Hat Tip to Dawn at Frugal for Life]

Posted by Tricia on February 25, 2007 at 12:07 PM in Credit Cards | 10 Comments »
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I Was an Emotional Shopper

I confess, I am a huge Grey’s Anatomy fan. Thursday’s episode left me crying through almost the whole hour. The thought of the lead character, Meredeth, possibly dying upset me and I was saddened at how her friends at the hospital were feeling.

One of Meredeth’s closest friends, Christina, was watching and waiting to hear something about her friend. After a while, Chistina said that she couldn’t do this (wait for news) and left the hospital. We later see her shopping and a little bit later she’s visiting the bar showing the bartender what you can buy for 99 cents. She plopped a yellow plastic child’s chair on the counter (Christina has no children) to show the bartender her great find.

Christina is an emotional shopper…I was an emotional shopper.

More often than I would like, when I was feeling down about things I would go shopping. Interesting enough, most of the time it occurred when I was feeling down about not having money so I would turn around and go shopping. Like Christina, I wouldn’t go and buy glitzy expensive things, I would buy less expensive things that we really didn’t need. How about purchasing a cute picture frame even though I had no idea what to put in it? Or some new shirt that looks nice, but I probably won’t wear because it’s not “my style.” I wouldn’t spend a lot with each trip, but the trips add up.

Did the shopping make me feel better? Not really. I realize that now so I fight the urge whenever it arises. I’ve taken the need to go shopping and I either go online and write on my blog, or I clean the house. I’m replacing shopping with other things and so far it is working. There could always be a relapse and I could go overboard with buying expensive things, but I don’t think that will happen.

I feel much better now that I admit what was happening and I’m taking steps to stop it. Our checkbook is thanking me too, but the credit cards aren’t