This board hepled so much

iVillage Member
Registered: 03-20-2004
This board hepled so much
4
Tue, 08-17-2004 - 11:47am
After lurking for a month or so I finally decided to post a few weeks ago. My finances were a total mess. I have about 6K in CC debt, which isn't horrible. But I owe 40K in medical bills and I owe about 40K for student loans. So along with my rent and 8500$ a year car insurance I end up paying about 3300$ a month. At some point I would really like to be out of debt, and possibly start saving for a house. (I'm only 22 so I have a little time).

To accomplish this I put myself on a very strict budget. I work two jobs so I have two paychecks and I get tips from my weekend job. I use my tip money for gas and food, and shampoo and stuff. I watch what I spend at the grocery store and buy what's on sale. I only use about 15-20$ for food. Gas is about 25$ a week. What's left over at the end of the week I snowflake to CC debt (usually about 40$). I got rid of my debit card (that thing is evil). I cut up all my credit cards and called them to get the interest lowered. I went from 29.4% to 13.4% on one card (1875$ balance), just by calling them. In about 10 months I can save up enough to pay them off. I switched my checking account into a money market account. I have to keep a 1000$ minimum, (emerency fund), but I get 1% intrest, and free checking like a checking account.

I found a new lawyer that will take on my case (to get rid of the medical bills) pro bono, and he says I have a really good case and could get a lot more than 40K. All I really want is to pay the medical bills and give him his 30%. So there is a possibility of getting rid of 40K of my debt soon.

I'm not so worried about the student loans. I like that the interest is tax deductable and only 15K of it is actually in my name. The other 25K is in my father's name (but it's my responsibility). So it doesn't look like I owe alot on paper. I wish I could get the tax deduction on the 25K though, instead of my dad.

I found out that I actually loose two insurance points this year, plus I'm taking a defensive driving course to knock 2 more points off. So my premium will decrease a little (maybe 7000 instead of 8500) next year. (Gotta love Jersey)

This board really hepled me put things in perspective. Now I don't dread working 7 days a week. I know I'm working towards a goal. I don't mind cutting back on expenses. I still don't use AC in my car. But I do occasionally in my house. I avoid toll roads as much as possible (35$ more a month to snowflake). I have accepted the fact that I'm not going shopping anytime soon, but I have tons of clothes and shoes already. I'm not going to be out of debt next week, but if I'm patient I'll get through this.

Sorry this is so long

Thanks everyone...

Sarah

iVillage Member
Registered: 07-06-2003
Tue, 08-17-2004 - 11:59am
Sarah,


You seem to have a good plan in place. Just remember to sometimes give yourself a little treat so that you reward yourself for the efforts you'll be making. It's a lot like attempting to lose weight, in order to stave off full-blown binging one needs to allow themself to eat a bit of their favorite things :)

I hope you win your case, and that your insurance will drop....to $7K...I still couldn't believe it when I first read your initial post :)

I credit this board and the people here in my becoming debt free so I encourage you to hang around especially when things get rough.

Best wishes,

Kassandra

Kassandra

"It is said that life has its peaks and valleys.  The challenge is to accept them equally and experience them

Avatar for cl_beckymk
iVillage Member
Registered: 03-19-2003
Tue, 08-17-2004 - 3:24pm

Yeah and

iVillage Member
Registered: 05-30-2003
Tue, 08-17-2004 - 8:26pm
This sounds like a workable plan, but I agree with kassie-make sure that you build in some 'blow' money into your budget. It gives you some wiggle room if needed, and you can use it to treat yourself every so often.

Yay, you! I think that you've made a darn good start, and I so wish that I'd gotten ahold of my finances at your age (I'm 35)!

Lisa

iVillage Member
Registered: 03-20-2004
Wed, 08-18-2004 - 9:28am
Thanks once again for your replys. Right now I'm pretty excited to be on my way to being out of debt. I've had debt hanging over my head since I was 16 (1st CC and Student Loans). Overall I have pretty good credit. I was able to buy my 1st new car at 18 without a cosign (but at 18% interest). When I leased my Civic last year I found out that my credit score is 720. I've had the habit of maxing my CC's out and paying the them off and charging them right back up again. This viscous cycle has gone on for a while. As my credit gets better and my income increases, my credit limits increase too, putting me in more and more debt. I don't want to end up like my dad, who makes over six figures, but filed a Chapter 7 last year because he had 130K in CC debt.

As far as giving myself a little wiggle room, I can do that on the occasion I get an unexpected big tip from someone at my weekend job. But right now I don't mind sacrificing a little. Every dollar that I save is one step closer to being out of this hole. Once I see the balances start to drop, I'll be OK with spending a little on myself (cash only).

When I do finally decide to go shopping I'm going to try to get the most out of what I spend. Instead of going to Express and spending 80$ on a sweater I can go to H&M and get like four sweaters. Or just get one and snowflake what I save.

I went to the grocery store last night and spent $13.69. Since I'm watching what I'm spending I have been actually eating a lot better. I eat more friuts and veggies (whatever's on sale). I eat oatmeal, pasta and beans (cause they're cheap). I haven't bought meat in a while. I get protein from milk, peanut butter (which can be put on pretty much anything) and dried or canned beans. In the event I crave a steak, I'll let the boyfriend take my out to dinner :) I even stopped buying bottled water. I just refill a water bottle from home with the water from the water cooler at work.

I feel a lot better now that I know where my money's going. This board is great.

Once my CC's are paid off and my medical bills are hopefully taken care of (meeting with the lawyer tomorrow) I'm going to give myself one day off a week. ( I get 19 days vacation time a year from my full time job). In couple years I might be able to quit the second job entirely.

Thanks for all your support....

Sarah