New with questions
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New with questions
| Sat, 08-21-2004 - 5:44am |
I am 24 and a single mother, who teaches full-time. Luckily I don't have to pay for child care (my mom takes care of ds), but I definately have my share of bills/debt.
My student loans have been in forebearance for the past two years (anyone know how long I can keep doing that?), but my payments begin in Dec. on that. I have several cc's (was talked into getting them for "emergencies" by an ex-boyfriend, and since, at the time, I had the good credit, we put them in my name) adding up to about $10,000. I know that making the min. monthly payment will have me paying on them all for years (one card with min. payment will take 9 years...with over $5,000 interest!). I am expecting a credit report in the mail this week sometime. I do not receive any child support (have filed for it, he hasn't been served yet, I can't afford a lawyer, etc.), so I get no extra help. I have already paid off one card, but kept it (for "emergencies"). Long story short, I had to make $200 monthly payments on a loan my ex was supposed to pay on for about 4 months, which forced me to use my cc for gas, groceries, utilities, etc. I do not want to be in debt! I have enough to worry about as it is. I was wondering about debt consolidation. Do any of you have any experiences with consolidating? Is it a good option? I am renting an apt, have no car pmnt (just insurance), don't do any extravagent spending on entertainment or vacations or anything like that. I don't really know how to go about setting up a budget. I also want to be able to have enough left over every month to start a savings account and get life insurance (for my son's sake, just in case), but how do I do that? Any help/advice would be greatly appreciated :-0)
Thanks!
csd
My student loans have been in forebearance for the past two years (anyone know how long I can keep doing that?), but my payments begin in Dec. on that. I have several cc's (was talked into getting them for "emergencies" by an ex-boyfriend, and since, at the time, I had the good credit, we put them in my name) adding up to about $10,000. I know that making the min. monthly payment will have me paying on them all for years (one card with min. payment will take 9 years...with over $5,000 interest!). I am expecting a credit report in the mail this week sometime. I do not receive any child support (have filed for it, he hasn't been served yet, I can't afford a lawyer, etc.), so I get no extra help. I have already paid off one card, but kept it (for "emergencies"). Long story short, I had to make $200 monthly payments on a loan my ex was supposed to pay on for about 4 months, which forced me to use my cc for gas, groceries, utilities, etc. I do not want to be in debt! I have enough to worry about as it is. I was wondering about debt consolidation. Do any of you have any experiences with consolidating? Is it a good option? I am renting an apt, have no car pmnt (just insurance), don't do any extravagent spending on entertainment or vacations or anything like that. I don't really know how to go about setting up a budget. I also want to be able to have enough left over every month to start a savings account and get life insurance (for my son's sake, just in case), but how do I do that? Any help/advice would be greatly appreciated :-0)
Thanks!
csd

Setting up a budget can seem intimidating but it
doesn't have to be hard. I really like using software
for it (you might have something on your computer already)
but you can do it on a memo pad with a pencil too.
The first thing you have to figure out is how much you have coming in.
Usually, that just means adding up the paychecks that you'll have
in a month. Obviously, that's your "incoming" money.
Then, in another column, list your "fixed" expenses. Insurance,
rent, cc minimums, utilities, etc. Everything that you have to
pay every month.
Then you have to figure out your flexible expenses. These might
be things like gas, groceries, eating out, entertainment, etc.
Even though you HAVE to buy groceries, the amount you spend is
flexible. So try to estimate what you might be spending each month
in each category.
Add up your fixed and flexible expenses and you have your "outgoing" money.
Then, the money you have left (if you have some left!) is what you
have to work with. You can decide to put this toward savings, bigger
payments to your credit cards, or whatever you think is a priority.
The key to a budget is that you have to keep track of where you actually
spend your money. It's no good just to write down $200 for groceries,
if you're spending $300. That doesn't mean you won't go over sometimes,
I think most people do, but the important thing is to be aware of it.
That way the next month you can decide if realistically you need
$300 for groceries OR you have to do a better job at sticking to
$200. Or maybe a little bit of each.
So what you have to do, the toughest thing at first, is to be aware and
record EVERYTHING you spend. Start a ledger and write down every amount
that leaves your hands or your account and what "category" it falls into
(groceries, gas, electric bill, etc). Do that for a month, add them up and compare them to your budget. Or better yet, check them from time to time during the month to see how you're doing.
I hope that helps and that I wasn't stating the obvious! I had no idea
how to set up a budget until I was in my 30s. I think most of us sort
of "know" we just don't want to deal with or don't want to face it.
But it's really empowering if you can set your mind to it. It's the
only way to really get a grip on your money and to start making it work
FOR you. It's a good feeling to know exactly where it's going instead
of living in a fog (like I have for most of my life).
Good luck!
Typically you can defer your student