A newbie with questions

iVillage Member
Registered: 04-02-2003
A newbie with questions
2
Thu, 06-12-2003 - 1:48pm
Hi all,

I have to introduce myself. I'm in my late 30s, engaged with no children and deep in debt. As with many of you, most of my debt approx. $40K is a grad school student loan. The remainder approx $5000 is cc debt. Last month, I returned to my parents home to save money for the future (i.e. emergencies, wedding, home), pay off the cc's and pay down the student loan. Also I lease my truck approx $330 per month.

I have to admit that I've been lurking on this site for about a month. The members of this board have finally given me the courage to face my debt and realize just how much in total I owe.

I have some questions (1) how should I start? (2) can anyone email to me at karla423@aol.com a budget spreadsheet? and (3) what should I do first establish an emergency savings or pay off cc?

Before I end, I must also say my credit is shot w/ all the late payments. I have a lot of work to do.

Thanks for listening,

Karla

iVillage Member
Registered: 03-31-2003
Thu, 06-12-2003 - 1:58pm
Hi Karla,

Welcome to our group!

There was a post earlier, maybe today, maybe yesterday, with EXCELLENT advice to another newbie. If you can, go through a couple of the posts already on here. I think it was a response from phoenixmom, hope2behappy, or momofchris.

The first step is admitting to yourself that you have debt, then accepting it. Then you can take action.

All the best,

Lee Ann

Lee Ann

www.werenotafraid.com

iVillage Member
Registered: 05-02-2003
Thu, 06-12-2003 - 2:06pm
I am by no means an expert on this since I basically just started budgeting myself, but my own priorities were something along the lines of 1) have an emergency fund... maybe not with 6 months of income but at least a couple in case anything happens 2) pay off c.c. debt 3) work on student loan debt... but at the same time I am also saving for a house downpayment. I myself have $55k in student loan debt and $7500 in c.c. debt. I used the debt calculator on CNN money today and figured out a payment schedule to get rid of the c.c. debt in 2 years (monthly payments of $321.16 total). This lets me put away a few hundred into the house fund. My student loan was consolidated in a way that I can't anticipate my payments for the first 2 years of consolidation so that's a moot point for me.

In terms of my budget spreadsheet, this is what I do at the beginning of each month:

1) take monthly pay (I get paid once a month, at the end of the month bc I live in Europe and that's the law here)

2) transfer rent money into savings account (bc I pay rent every 3 months)

3) subtract c.c. payments (since they are a fixed amount each month) and student loan payment

4) subtract my savings (for the house fund)

5) subtract my estimated bills for the month (this can get tricky... but I basically averaged out my utilities, internet, food, etc bills for the last 6 months to get this amount). This gets deposited into yet another savings account.

6) This leaves me with how much cash I can spend in that month... Then I only allow myself to take out a max of 1/4 of that amount per week... I try for less though. I consider my c.c. to be cash spent. Every week I pay off the c.c. with an electronic transfer (saves the stamp and it's faster). This counts as part of the 1/4 weekly amount.

I don't know... it seems to work for me. I found that it's really key to keep track of where you are spending your money... even down to the last cent.