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Handing Off Blogging Away Debt & Looking For A Writer

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Hi Blogging Away Debt Community,

I’m James.   I wanted to take a few moments to let you all know about a few updates here at Blogging Away Debt.  A few weeks ago,  Jeffrey and Nate, who had been running Blogging Away Debt, decided to sell the site to me.  We closed the deal a couple of weeks ago and I wanted to take a few moment to let the BAD community that there will be some changes moving forward.  Specifically, I wanted to take an opportunity to ask for your help.  We are looking for another volunteer blogger for the site.  The specifics of what we are looking for are below:

If you think you may be interested in writing, we are looking for someone who will be able to write two or three posts each week. Researching and writing three blogs per week can take a good bit of time so you will want to make sure that you will be able to devote time to it. Here are a few other things we are looking for in a blogger:

  1. You don’t need blogging experience. We would love for your to share you personal finance tricks, hacks, debt stories! However, you will need to provide at least one sample of your writing for our review.
  2. Be willing to interview and be interviewed. Sometimes blogging includes chatting with people and both asking and answering questions. You’ll have to be ready to do so.
  3. You also need to be willing to interact with readers. If our readers are commenting on your post, we’d like for you to respond to them and create a dialogue.
  4. We aren’t looking for a personal finance expert but some background in personal finance, a great debt payoff story or even frugality tips is a plus. We want you to be interested in what you are writing about!
  5. This is a volunteer position. While there is no direct compensation made for each post, there are some opportunities for bonuses, especially if a post is performing extremely well (getting traction). We want someone who is looking to write because they want to help others, whether it be helping them learn to save or providing tips on how to make your own laundry detergent.

Those who are interested in writing for Blogging Away Debt should email me, James Hendrickson, at james@districtmediafinance.com.  I will get back to you with more information and set up a time to chat about a writing sample. If you have any questions feel free to leave it in the comments below or email me!

 

 


How it All Began

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How it all began……

I was never good with credit. When I was 16, Lane Bryant sent me a credit card. I had ordered from there catalog for several years. I don’t remember filling out a credit application, just this very pretty purple piece of plastic coming in the mail, and I then could order clothes and pay a small $25 a month until they were paid off. Easy, right? I had my first charge off on my credit report at 18.

I was a single mother at the time, and on welfare. The next step was to go back to work, and I needed a car. But with a new job and a small awful credit file, I needed a co signer. I don’t know how I did it, but I talked my Dad into it. I bought a 1990 Ford and went to work 3rd shift.

I behaved at 1st, making payments on time, and then I moved out on my own. I lived in an apartment with my son, and my soon to be husband. (now my ex husband). Living on my own was hard, and things started to slide. First my car insurance didn’t get paid, then it was canceled. So the finance company added their insurance to the car. Then I fell behind in the payments. Eventually I had to give the car to my Dad, and borrow his paid off car to drive back and forth to work. He was nice about it, but swore he would never co sign for me again, and he never has. Not that I would ask.

When my ex and I got married, we moved south with the military. He then took over the bills. I had given my Dad his car back when we moved, so we were down to one vehicle. We decided to trade his truck in and buy 2 cars, one for each of us. His credit was good, so it was no problem.

Fast forward a few years, and we are out of the military and permanently living in the south. Thing are tight, and my ex and i fight about money a lot. Eventually we end up splitting the bills 50/50, and each of us have to pay out of our own paychecks. He doesn’t care about any credit cards, just that if they are in my name, I have to pay them myself. Me, having no self control with money, rack them up. We split in 2001, and he walked away with a paid off truck. I was left with 10,000 plus in credit card debt, student loans, and a single wide mobile home with a 20 year mortgage.

I then decided that I wanted a new car. The one I had was with a credit union, and I was upside down a lot. But it was in my ex husband’s name. So, I let it go back, and bought a car on my own. Took out more credit cards. Move to a rental house that was $250 more a month and let the single wide trailer go back to the bank.

Are you starting to see a trend?

Don’t get me wrong, I was making it, but by the skin of my nose. By then I was at my current job but a single mom of 2 kids. Do you know how embarrassing it is to have collection agencies call you at work, while you are a bill collector for your job? One time, they even faxed my boss about my debt. I blamed my ex husband, and prayed that they would stop one day.

Then the rental house caught fire. Thank goodness I had renters insurance. I had a ton of cash, and a spending habit that I had not fixed.I found a new place to live, a rent to own house. I had one year to rent, and I had to get the mortgage in my name. I did it in 6 months. That was the height of the housing bubble, and I got a 11.75 % variable APR mortgage on a $125,000 house. But I had a ton of money from the insurance, that made it easy. My spending habits didn’t change. My kids and I had more stuff then we knew what to do with.

I then met my current husband. He is 6 years younger than me, and still was living at home. We has a speedy courtship, 4 months from our 1st date to our marriage. The money from the fire had run out by then, and he didn’t have a well paying job, so I robbed Peter to pay Paul to pay for the big wedding we had. The mortgage company did the 1st loan modification on the mortgage within 6 months. They lowered my payment and my interest rate to 7.5 % fixed. I thought everything would work out.

Traded and bought a few vehicles, and racked up more debt. Was kinda of keeping my head above water, then my husband got sick. We then had huge medical bills that included a bill for a cornea transplant. Everything got past due, even the house again. We went and filled out the paperwork to file chapter 13 bankruptcy but didn’t have the filing fee until we got paid on Friday. Thursday, I went out my front door to goto work, and my car was gone. It had been repossessed in the middle of the night. So, I borrowed the filing fees to file a day early, and the next day, the lawyer got my car back from the bank.

Again, things were fine for about 6 months then hours were cut. My husband had to find a new job, and took a $2 an hour pay cut. That hurt. Our Chapter 13 payments were self pay, so we stopped them. And our plan was dismissed.

We went back to the attorney, and asked what to do. He said to keep the house, we would have to file chapter 13 again, but reduce what we were paying in the plan. We gave back my car, but kept my husbands truck. I went out and found a mini van on a buy here pay here lot and got that for transportation as our family by then had grown by our twins and we didn’t fit into the truck by then. This time my pay was garnished for the payments, and my take home was about $250 every two weeks. My husbands was about $600 every two weeks. Everything else went to bankruptcy. It was very tight. So tight, that I even went behind my husbands back and got 4 credit cards while in bankruptcy. See the trend.

Then the layoff. My health insurance at the time was 100% paid by my employer, but my husband carried the girls and himself. To add him and the kids to my heath insurance was $300 a paycheck. His unemployment was $115 a week, and I only was clearing $250 a paycheck. The bankruptcy payments had to stop. My attorney got the trustee to stop the garnishment, and I put everyone on my health insurance. We saved up and filed income taxes, and converted to a chapter 7. We bought 2 salvage titled cars, and let the truck and van go back to the banks. We did another modification that included stretching the mortgage to 40 years from 30 years, and kept the house. We were discharged from chapter 7 in July 2013.

Stay tuned for part two…


Dawn of a New Day

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Hello, I’m Marie. I’m here to get honest about my debt. Yes, I have a lot. So much, I am in denial about how much. That’s why I’m here. To be open, honest and get rid of this debt.

A little background about me. I am a 45 year old married mother of four and grandmother of four. Two of my children are grown, and I also have nine year old twins. My husband and I are coming up on our 11th wedding anniversary.

I grew up in New England, but I now live in the south. I moved here in the 90’s with my ex husband, and stayed after the divorce to raise my two children here. The cost of living where I grew up verses here is so much less and by then, my extended family was all over, that it made no sense to move back.

I grew up with a mother who was single most days, and struggled a lot. She would would work her tail off and then buy us with “stuff” when things got bad. To this day, she still likes to fill her space up with “stuff” and still struggles herself to make ends meet.

I have been at my current job for sixteen years. I am the Credit and Collections manager for a home heating fuel company. I handle not only the extending of credit to our customers, but the day to day collections of our accounts.I think that its ironic that I work as a bill collector, yet manage mine so poorly. I adore my job, yet wish I made more at it. Don’t we all?

My husband also works, he works for an automotive manufacturing business, He has been there about three years, after an eighteen month layoff from his previous job. He just was promoted and received a raise, yet his overtime has been cut in the last few months.

I handle 100% of our bills. My husband has no idea even how to handle a budget. We are scheduled to start Dave Ramsey’s class the middle of September. I think it will be a good tool for us, motivation for me, and a real eye opener for my husband. We our out of balance when it comes to money, I stretch it as far as I can, and he thinks as long as the debt card works, its ok. I won’t lie, I have gone through times that I have turned into my mother, and enjoyed my “stuff”. We have been through major medical expenses, a layoff and even bankruptcy. I’m not proud of that last thing, and I am determined never to go there again.

Like I said before, we have a ton of debt. I don’t have specific numbers yet, but around $20,000 in credit card debt, $10,000 in personal loans, two (just bought in the beginning of 2017 )vehicles (about $30,000 each), a $15,000 in student loans, and in February we bought a new house. So if I had to ballpark it, we are talking about $105,000 in debt, not including the house. The house is owner financed, and we have to re finance it through a bank no later than November 2018. That is a whole separate blog post in itself.

We have huge hurtles to overcome, but I have faith that we can do it all. Today is the dawn of a new day.


Sustainability Should Be a Priority When Planning For Retirement

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The local annuities market has grown over the last few years. At the same time, fewer individuals are opting for conventional life annuities, which is quite interesting since conventional life annuities are the only products that provide guaranteed returns for the rest of the retiree’s life. However, these products tend to be expensive (particularly ones that adjust for inflation) and income yields are low.

While some people are prepared for retirement, most are not saving enough. These retirees hope that the market will make up for any lack in capital and are opting for living annuities, which offer more flexibility and the potential to earn higher returns.

The real issue here is a lack of savings. If you find yourself in this category then don’t despair: Proper planning and rational investor behavior can help you manage the problem.

The key is planning

Investors need to examine their financial positions and speak frankly about their options long before they retire. This may be a painful exercise but will present you with more options and ultimately choices. Having as much information about where your funds are invested and what the best performing unit trusts are, help make these choices less daunting. Think about how much you have saved and how long you will need support yourself during retirement. The key risks most retirees face are outliving their money and inflation eroding their savings. Developing a plan will help you account for these risks. As our life expectancy continues to increase it is advisable that you limit your consumption during the early retirement years.

Facing the facts

A lot of capital is required to enjoy the same lifestyle after retirement. If you retire with less than you need you can offset it by drawing more income early on, but this is not sustainable. Spending too much after saving too little is guaranteed to end badly.

You can consider delaying your retirement a few years to save a bit more. It tends to be easier to extend your career rather than go back to work after retirement. This may not be the most attractive option available, but it allows you more time to save, less time to live off those savings and gives your capital more time to grow.

You should not underestimate the impact this extra time will have on your savings. Extending your career in your twilight years may not be that appealing, but it is a better option than having to survive on a low retirement income or running out of money too soon. While some factors may be out of our control we can at the very least influence the longevity of our savings.


Brace Payment Be Gone

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Braces have been part of our lives for almost five years now. You can read some history in these two older posts.

A Car or Braces

Braces – Part II

But I am excited to announce that as of yesterday, all brace debt is GONE! Paid the final $460 payment!

(Braces were not in my budget as I have maxed out my FSA deductions from my W2 job and have been using it to make the payments since I started my W2 job in March.)

Man, this feels good!


First Paycheck = FAIL!!!

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I received my first full paycheck at my new rate of pay. I was shocked that it was much lower than I had anticipated (even after using a couple online calculator programs to try to accurately predict take-home pay).  My expectation was that I’d earn somewhere between $5-6,000/month take-home.  The reason for the large range is that I have a LOT of money coming out in pre-tax deductions, including:  medical and dental insurance, Flex Spending Savings accounts for health and dependent care, and 7% retirement investment (required and matched by my employer). In total, I have 20% of my check removed pre-tax. Taxes remove another 20% of my paycheck. So when looking at my base weekly salary compared to my take-home pay, I’m only actually bringing home 60% of what I earn (to be fair, I’m saving money by being able to pay a portion of medical and childcare from our FSA with pre-tax dollars, but our FSA has caps that we exceed, so some of those expenses are still paid out of my take-home pay post-tax).

After all deductions, my first full paycheck was for a total of $2269. I get paid bi-weekly, so we’re talking about $4500/month for most months (except for the odd month with 3 pay periods). This was a huge shock, given that we’ve been quite accustomed to budgeting for literally double that income amount.

I’ve never shared exact income numbers before on the blog because it made my husband feel uncomfortable for his business earnings to be shared and analyzed. But now that he’s shut his doors down and it’s all me – I feel fine with sharing my personal income. Guess what, y’all….my salary is $95,423/year. That’s with my big raise. I was originally hired at $55,000 two years ago. I guess there’s some disconnect in my brain or something because I thought $95k sounded like “BIG MONEY.” When I got my raise I was overjoyed – I was expecting a huge, wild difference in my rate of take-home pay. Under $5,000/month was NOT what I was expecting. Call me spoiled or privileged of whatever else you want (and I own that I am some of those things – I’m lucky to have the job I do), but this was a huge shock.

So although it feels like “starting over” (although it’s not!!! We’re still down nearly $80k in debt over the last 3 years), it’s definitely a come-to-Jesus moment. Hubs and I have had to totally start over on our budget with fresh eyes. Thinking about how to continue making progress on our debt reduction journey while simply surviving (here, we thought we’d be “thriving” with this huge raise). Some tough realizations have been made:

  • Hubs must keep earning an income somehow. Hubs has run a successful flooring business for almost a decade, but recently quit to go back to school. Many people have commented that he should keep his business going for some side-income, but it just doesn’t work that way. Unless you’ve owned a business in the construction trade before, you probably don’t realize how expensive it is just to maintain the proper insurances, licenses, etc. Hubs is NOT the type to do business under the table without the appropriate certifications. It’s a big problem in his industry (and where we live, in particular), and he was not about to go that route. But to just keep his insurances and licenses up to date cost several thousand a year. When we looked at what he was bringing in part-time versus the costs to keep the company legal, it just wasn’t enough to make it worthwhile. And, maybe surprisingly, the flooring trade is not as flexible with a school schedule as we need. Hubs’ first semester back was this past Spring and he had many stressful calls from employees (or worse, home-owners) with issues that demanded immediate attention, while he was still stuck in class for many hours to come. All in all, this was a losing proposition for our family. So now we’re trying to think of more flexible and accommodating ways that hubs can earn some side-money while in school. So far brainstorming has included: driving for uber or lyft, doing some type of food delivery, and perhaps trying to become a personal trainer. Remember – hubs has been big into health and fitness the last couple years, so the latter is his preferred method, but it will also take the longest to get started and requires additional research first. Any other ideas?
  • Food consumption has to get under control. A friend recently posted on facebook to inquire about how much her friends’ families pay per month for groceries. The most common number I saw was $250/week. I have to say, for the past couple of years since I’ve been working 2 jobs, our food budget has been way over $1,000/month (including groceries + eating out). I mean, $1,000/month was a GOOD month. But remembering back to when I first started blogging, it hasn’t always been this way! In fact, my original grocery budget was only $400/month!!! And I stuck to it! To be fair, it was never easy. I would spend a TON of time researching sales, carefully planning meals around sale items and food we already had in our pantry or freezer. I would easily have to go to 2-3 stores per week to get the best priced items (Walmart does their ad matching, but our local Walmart doesn’t have great quality produce). I’d also make a ton of items from scratch. Everything from breads and homemade granola bars to fruit leather and yogurt – even baby wipes I made myself for cheaper than could be bought bulk at Costco. Between ad searching, meal planning, grocery shopping, food prepping, and scratch baking, I probably spent a good 10-15 hours/week on my efforts. It paid off big-time in terms of money saved, but I just simply lacked the time when I started working full time (plus kept my part-time job, on the side). When I accepted my big raise I had to sign a non-compete so I had to leave my part-time job. So even though I still work full-time, I have significantly more time in the early morning/evening/weekend hours to try to devote to some of my old grocery-saving ways. I don’t know that it’s reasonable to get back to only $400/month. But I think if I shoot for $550-600/month (again – that’s for all food: groceries + eating out), it would be a huge savings over our current spending. I’m going to give it an honest effort for the month of August and see how I do.
  • The budget, in general, needs to be slashed. It’s scary how easy it’s been for things to creep up over time. When I first started blogging all our gifts were in the $10-15/range. Recently our gift-giving has been closer to $25-35+/gift. Hubs and I have both rejoined a gym. It’s very important to hubs (and he spends legitimately a ton of time there), but maybe I’ll cancel my own membership to try to save some money since I’m perfectly happy to run outdoors for free as my preferred form of exercise. I also had a friend recently mention that some health insurance companies offer discounts for gym memberships? I need to call Blue Cross, Blue Shield to inquire about this. Spending across the board needs to come down.
  • Debt payments??? Probably the hardest thing to accept is that our debt payments are going to drastically decrease. We’d grown accustomed to throwing thousands a month toward debt! I’m talking many months where we were paying $2500-$3000/month toward debt!!! Obviously if I’m only bringing home $4,500, there’s no room for a $3,000 debt payment. It’s just not possible. So we have to adjust expectations, adjust our 2017 financial goals, and just keep plowing forward, making as much progress as possible with what we have to work with.

So, ultimately, we need to cut our expenses AND try to find a way to increase our income. There’s not much wiggle room for me (since I can’t pick up side work in my current industry), but I think we can try to find solutions to get hubs some part-time side gigs. My focus will be best spent on trying to reduce our food expenses, since that tends to be our #1 monthly expense (cumulatively speaking. And yes, I know how ridiculous that sounds, but it’s true).

So there you go – I’ve laid it all out on the table. Next up will be formulating a solid budget plan and figuring out how to juggle our debt payments. Especially now that we owe $1,000/month to the IRS from our poor planning last year. Ugh! But baby steps here – if I think about everything at once I become overwhelmed so it’s one thing at a time. We now have a solid “income” figure so we know what we’ll be working with in terms of take-home pay. Now it’s time to figure out how to make our outflow match with our inflow and to find additional areas to cut back.

 

How much does your household spend per month on groceries (and how many people are in the household)? How do you save money on your food budget?


Hope’s Fall 2017 Monthly Budget

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Without further ado, my new monthly budget.

DescriptionMonthly Budget
Total$2,819
Rent$650
Groceries$600
Health Insurance$305
Gymnastics$300
Auto (gas & maintenance)$300
Utilities$250
Entertainment$200
Auto/Rent Insurance$130
Gym Membership$50
Netflix$12
Bill (paid annually)
Life Insurance$22

Some important things to note.  This budget does not include my business expenses, or rather bills I pay out of my business account and use for tax purposes including but not limited to my cell phone bill ($286 monthly,) Adobe Suite membership ($29 monthly,) Microsoft Office ($99 annually,) Dropbox ($99 annually) and so on.  I have completely separated my personal and business expenses since I am working full time as a employee while continuing to work as a contractor.

My income is still pretty variable but the bulk of my income comes from my full time corporate job and a steady consulting job where I work 25ish hours per week.  I currently have 4 sources of steady income and continue to pick up odd jobs. My  income since March of this year has averaged about $6,000 per month.  This is post-deductions for my W-2 full time job and pre-deductions and tax for my consulting jobs.

Now, with that being said, I already know there are changes coming to this budget…first, my deferment ends on my student loans in September at which time I will start paying a minimum of $305 per month AND per my last post, I am beginning to invest in my company sponsored 401K beginning this next pay period.

I did read all your advice and while I get more educated and review all options, I did cut back my 401K from my originally planned 20% to 10%.  I am going to look at Roth IRAs, etc. over the next couple of months, and continue to build my local savings account.

I think most of my budget is self-explanatory, but here are a few notes:

  • I now have to pay for Little Gymnasts training. Ouch!  No more barter. The monthly cost is not quite $300 but I put some buffer in there to help cover the meet fees which will run most of the winter while he is competing.
  • While my commute to work is only 12 miles, I have a two hour round trip 3-4 times a week for gymnast training, thus the higher gas cost.
  • I opted out of the company sponsored health insurance due to its cost and limitations and instead chose to go with a Christian based medical sharing company.  That is the month healthcare cost for the four of us (History Buff is now working full time.)  I do have dental and vision through my corporate job for a very reasonable cost for the entire family.
  • I know $200 is a lot for entertainment. It’s really more a buffer for odds and ends right now.  Sports for the kids and misc housing costs as we continue to settle into our new home. (For instance, I have to buy Sea Cadet a bed this month before he returns from being gone all summer, working at summer camp.)

I will try to be responsive to questions. I know I have tightening up to do. I’ve recently pulled all my credit reports – ugh! So will get a debt update up in the next couple of weeks.