In black and white... but mostly red

iVillage Member
Registered: 08-19-2003
In black and white... but mostly red
9
Fri, 12-10-2004 - 4:02pm

Ok, I've been working on this for a while, and thought I'd put it all down on paper and see what happens. Here are the balances on my cards.

1. $269.87 (limit is $300)
2. $324.68 (limit is $200)
3. $1102.44 (limit is $870)
4. $436.80 (limit is $300)
5. $335.00 (limit is $300)
6. $526.41 (limit is $500)
7. $3234.89 (limit is $3036)
8. $2639.77 (limit was $2800... they closed this one)
9. $8.56 (this one was closed by them also, will be paid next week)
10. $680 to Dell for my computer
11. $400 to the local gas company for propane
12. $350 loan from family
13. $5500 car loan ($274 monthly)
14. $805 personal loan ($115 monthly)

It would cost me over $700 just to get things at the limits, which I don't have. I know they seem like small balances, but I can't tackle them all at once and they just keep hitting me with fees, so I can't make any progress. And I have Christmas gifts to buy, at least three. I haven't bought a single gift so far. And I have personal property taxes to pay by the end of December and they are $95. I don't know what to do first, and it seems more and more hopeless all the time. I know some of you have snowflakes each month that are bigger than my paychecks, so I just feel like this is impossible for me. I don't have extra money like that. It's just me, and even with two jobs it's a pain. I think if I can ever get caught up it will be easier, but how do I get there. If anyone has any words of wisdom, please throw them my way. I'm grasping at straws here.

gomom99

iVillage Member
Registered: 02-19-2004
Fri, 12-10-2004 - 4:12pm
I would prioritize the car loan, personal loan and propane bill. Are the credit cards current, behind, charged off? How much to do you have to put to bills each month, after paying household bills and groceries, gas, etc.?

Photobucket

iVillage Member
Registered: 06-04-2004
Fri, 12-10-2004 - 5:24pm
I know it can be disconcerting to put it all down in black and white, but you have just made the big first step. Now you know where you are with each of these debts. I would recommend paying off #9 first as you said you will and feel really good about being able to cross something off the list. Then take a look at what you want to tackle next, whether it be one with a high interest rate or a small balance so that you can cross another one off your list. Only you can decide what order you want to pay them in, maybe pay #5 down to below the limit. I'm not sure if you are being charged over the limit fees on these, but I think if you were able to get them below the limit it would at least save you those fees each month and you will be able to apply more to principal. Take it one debt and one day at a time. You will get there! I know, I use to have $35,000 in debt that I never thougth I would get any control over, I'm now at about $18,000 and it feels so good to make those payments each month and seeing the balances drop. Of course it's going to feel even better when the debt is gone, but there is some sense of accomplishment gained from paying these things off. Keep your chin up! You'll get there, in the meantime, we are all here for you! Hope that helps a little bit!
~leanne

~leanne

deciding to be happy doesn't mean that everything is perfect, but that you had decided to look beyond the imp

iVillage Member
Registered: 03-31-2003
Fri, 12-10-2004 - 6:08pm

Hi gomom,

You look like a candidate for a consolidation loan if I ever saw one. You are gainfully employed and have a second job. That weighs heavily in your favor. Have you ever asked your primary bank (wherever you deposit your paychecks) if they can do one for you? You're right--those seem to be a lot of comparatively 'small' balances which are EACH nickel and diming you to death on over limit & late fees, not to mention interest. I am looking at a pile of cc debt myself at the moment (while making just $8/hour at a part time, temporary job(!!), but all my debt is on one line of credit with one minimum payment of about $125/month. If I was facing all those separate payments and issues, like you, I know I'd sink, even though you and I owe about the same amount on our cards.

It doesn't hurt to ask for a consolidation loan from your bank....and if you already have, it doesn't hurt to ask again. Do you know how much you could comfortably afford each month to put towards debt, if you only had to write one check? (after your monthly living expenses are taken care of)?

BK




iVillage Member
Registered: 03-28-2003
Fri, 12-10-2004 - 9:07pm

I know you are working so hard and when you're behind it's hard to see any progress. You need to set your priorities. These should be food, shelter, utilities, and transportation. Start your budget with these items. Paying the credit cards should be last on the list, you'll get to them eventually.

You might not feel comfortable sharing anymore information but if you could post your income and a rough draft of your budget, showing the minimum payments, maybe we could help a little more.

In the past when we had every little money and we were behind on everything I would send creditors weekly payments, sometimes as little as $5.00. By sending small weekly payments I felt that the creditors knew I was serious about meeting my obligations and I felt a sense of accomplishment. Another technique I used with auto and loan payments would be to pay a payment and a third. This way I was sure to be caught up in three months.

Don't lose hope. You are doing the right things and sooner or later things will get better. You just need a plan you can follow.

Julie

iVillage Member
Registered: 02-14-2004
Fri, 12-10-2004 - 10:21pm
Honestly, it looks like your best bet may be a debt management plan through consumer credit counselling. The problem is the over the limit fees, which are outrageous, plus the high-interest rates. The advantage of a debt management plan is all those fees are put to a screeching halt and interest rates lowered, thus your monthly payment is cut and you actually make some progress. Before we joined a DMP, we had only one card that was over the limit but the monthly fees were a killer.
Good luck.
iVillage Member
Registered: 08-19-2003
Sat, 12-11-2004 - 7:38am
The car loan is current, and never late in over three years. I have to have it to get to work, so it is a priority. I make sure all the utilities are paid, and the personal loan gets paid on time as well. We skimp on food, make do with whatever we can. The credit cards are last, and sometimes not paid. Minimums range from $20 to $100, and if I could ever get caught up, I could start whacking away at them, but December also means car insurance, and that other holiday that everyone else buys gifts for (bah, humbug). I just have to survive December, and it's questionable. Most cards are just a month late, the two largest are about 3 months late. If I send them something this week, there will be no Christmas, because this is the last payday I have before then. Nice, huh? I have two teenagers and a boyfriend to buy for, and that's it.
iVillage Member
Registered: 03-27-2003
Sat, 12-11-2004 - 3:35pm

Hugs!!! I know these are tough times, and with Christmas coming up it's only that much more depressing.

But, as others have said, you have made a crucial step in writing it all down, and you *will* get this under control if you keep working at it. I suggest you keep a copy of your post, and look at it again in a year, so you can see how far you've come. :)

Meanwhile, I second the opinion that you need to look at your food, shelter (and utilities), clothing, and transportation needs first, and make sure they're covered. You can also look at those categories for ways to cut back. There are tons of great tips on this board in various places (try a search) for cutting back on these items, but the first and most important step is to track your spending so you know what you're actually spending. We have cut our *monthly* food spending to under $200 for a family of four. Our shelter expenses have gone up in the past year because we bought a house, but early in our debt recovery journey we moved to a cheaper place where some utilities were included in our rent and that was more energy-efficient due to being an apartment and being backed up to a hill with south-facing windows (we actually sought out an apartment that met these criteria knowing it would save on our heating bills). I shop for all my clothing at yard sales (I'm a sahm, so I don't need suits or tailored clothing, but I actually do find a lot of these items even at yard sales--it helps that I'm a common size, too). Dh's work clothes are harder to come by used, but we do our best and then budget a small amount to buy things when we find really good sales. Again, when we began our journey, we refinanced our car for a lower interest rate and a longer term. It meant we owe on it for longer, but at the time our primary goal was to lower our monthly outlay so we could get caught up on our bills. We have not been sorry. We considered selling and buying something cheaper, but the refinance made for sense for us ultimately. You might see if this is something you could do.

Once you've gotten those issues taken care of, you can start chipping away at your debts with every penny of excess. I like the idea of getting a consolidation loan if you can. If this works for you, you may have a lower payment, only one debt to keep track of, and it can get you current and stop the late fees.

Another option that can be combined with the first, or used alone if the consolidation option is not available, is to raise some quick cash just to get caught up. There is an essay, wish I had a link, on ivillage's money channel with a title something like "6 quick ways to raise cash now" or something similar. Anyway, look for that article. The most obvious thing I can think of is sell stuff. Even things you think you want and love, if it will get you under those limits so you can begin chipping down your debt. You can replace the items when your debt is under control. Jewelry, electronics, kitchenwares, furniture, clothes, etc. Sell online (ebay, yahoo yardsale groups, classifieds), have a yard sale, sell through your paper or other local publication, sell to friends, take items to consignment stores, etc.

That should get you a start on getting the overlimits under control. Then draw up a plan that makes sense to you on the rest of the debts. Here is what I think I would do in your place:

I would pay the $8.56 (as you already plan to do) right away.

I would pay minimums on everything else while focusing any excess in the following order:
Debts that are over the limit by the smallest amount--pay until under the limit.

Once all debts are under their limits I would pay the smallest debts first, regardless of interest rates. That way, if you have trouble again, you won't have so many accounts nickel and diming you. And it's gratifying to keep crossing them off--good motivation to keep you going.

I would ask my family if I could wait to pay them until an agreed-upon future date (a year from now, for instance) at which point, you would agree on a monthly amount you'll pay (as little as $5 or $10). By that time, the rest of the stuff will be under control, but in the meantime they have an end-date for how long they have to wait for their money.

Those are just my thoughts. Keep plugging--you'll make it!!

Blessings,

Heather

iVillage Member
Registered: 09-22-1999
Sun, 12-12-2004 - 11:12am

This my unique advice....Don't buy a gift for the boyfriend. I'm hoping he is mature and understanding of your current financial problems. Give him those non-monetary gifts like a back rub, help him with his household tasks, there are so many things we can DO which may mean more than a gift to unwrap under the tree. I can see how it would be imprtant to the kids, but you really don't have to go crazy. If everyone understands, they should be willing to work with you and make a few small scarifices. They already have what is important, right? Christmas gifts shouldn't be a priority over our financial and emotional health.

Best wishes, Littlesbigs

iVillage Member
Registered: 08-19-2003
Sun, 12-12-2004 - 2:06pm

My kids are 16 (on Monday) and almost 20, and they both know that things are hard, but I will still have to get them something. I have talked to them both, and they know that after I get caught up, I'll be able to get them an additional something. I probably will get my daughter a gym bag (she's a high school cheerleader, and her old one is about to fall apart), and maybe a sweatshirt or pair of jeans for my son. That won't cost a fortune, but still I'm not sure how it will happen. At least it will be something. As for the boyfriend, I'm not sure what to do there. I have to get him something... just not sure what. I guess I'll think of something.

Thanks to all of you for your advice and well-wishes. This board is great, and I make myself come here every day to read the posts. It helps a lot to know I'm not alone. December is almost half over, so all I have to do is get through the next couple of weeks. January will be a little better, since dd's birthday will be done, Christmas will be over (I hate being a scrooge), and taxes will be paid. I really am hoping for lots of snow in January, so I won't be tempted to go anywhere. If you don't go out, you don't spend money, right?

I do the selling on ebay thing, but right now I don't have much to put on there. I made about $100 on there last month. I may do some relists this afternoon, and try to scrounge up some more stuff to put on.

I have already sold all the big stuff I have at home, including some family pieces that I hated to get rid of. The family loan can wait until the other stuff is taken care of, we've already talked about that. I always make sure the car is paid, utilities and rent, and the other stuff waits until I can deal with it. I just have to get current, and right now that's the problem. If I could only get Santa to bring me a winning Powerball ticket!