Lara, I know it's hard to look at those numbers, but you've taken a big step in the right direction by adding up your debt. If you don't know what you owe, it's hard to start making changes to reduce the amount.
It doesn't feel good right now, but believe me, just by doing this, you're going to help yourself move forward instead of back!!
You're aware of what's gone wrong, now you can start making it right. And this board is great for support and ideas all along the way. Hang in there!!
Hi, Have you read any of Dave Ramsey's books? Total Money Makeover is clear and to the point. He always suggests cutting way back or stopping retirement contributions while you are paying off debt. He basically says that if you have debt and are still contributing to retirement, you are actually borrowing the money you are contributing because you are not using the money to pay off credit card debt etc. He probably would also suggest you sell the van -- buy some kind of cheapo used van or car, pay off the van loan, and put what used to be the van payment toward the credit card debt. Don't know how realistic the selling of the van would be, since you may not be able to get what you need used, and often you have to come up with some $$$ because you probably would't get the full amount you need to pay off the loan. It's something to think about tho. I am sure you have seen folks talk about their "target" credit card. That's the one they try to throw as much money as they can at -- after paying the minimums on other obligations. Then when you get that one paid off, you shift that payment to the next debt you want to get rid off. We're pretty much in the same boat -- and have stopped retirement contributions for now. Good luck. We're all in this together. Megan
Regarding retirement / savings, we have lowered our 401k investment to 3%, which is the maximum that our company matches. Since the match is "free" money toward retirement, we've kept it there. In contrast, we used to have 15% of our income going to 401k, so lowering it made a $200 per month difference in the snowball toward debt.
You mentioned you have this amount in credit cards:
Credit cards (6 total): $19,190
Can you list the balances individually? Doing this and tracking how much the balance is each month will show you how much progress you're making, especially if you are making the minimum payments on all of the debt *except* for your lowest balance, which you can snowball like crazy toward.
=)
Congratulations on facing your finances and making a decision that you are "sick and tired" of your debt! That's the first step in getting rid of it. You have to get MAD about how much you've got!
Lara, I know it's hard to look at those numbers, but you've taken a big step in the right direction by adding up your debt. If you don't know what you owe, it's hard to start making changes to reduce the amount.
It doesn't feel good right now, but believe me, just by doing this, you're going to help yourself move forward instead of back!!
You're aware of what's gone wrong, now you can start making it right. And this board is great for support and ideas all along the way. Hang in there!!
Amy K.
Lara
Have you read any of Dave Ramsey's books? Total Money Makeover is clear and to the point.
He always suggests cutting way back or stopping retirement contributions while you are paying off debt. He basically says that if you have debt and are still contributing to retirement, you are actually borrowing the money you are contributing because you are not using the money to pay off credit card debt etc.
He probably would also suggest you sell the van -- buy some kind of cheapo used van or car, pay off the van loan, and put what used to be the van payment toward the credit card debt.
Don't know how realistic the selling of the van would be, since you may not be able to get what you need used, and often you have to come up with some $$$ because you probably would't get the full amount you need to pay off the loan. It's something to think about tho.
I am sure you have seen folks talk about their "target" credit card. That's the one they try to throw as much money as they can at -- after paying the minimums on other obligations. Then when you get that one paid off, you shift that payment to the next debt you want to get rid off.
We're pretty much in the same boat -- and have stopped retirement contributions for now.
Good luck. We're all in this together.
Megan
Hello,
Regarding retirement / savings, we have lowered our 401k investment to 3%, which is the maximum that our company matches. Since the match is "free" money toward retirement, we've kept it there. In contrast, we used to have 15% of our income going to 401k, so lowering it made a $200 per month difference in the snowball toward debt.
You mentioned you have this amount in credit cards:
Credit cards (6 total): $19,190
Can you list the balances individually? Doing this and tracking how much the balance is each month will show you how much progress you're making, especially if you are making the minimum payments on all of the debt *except* for your lowest balance, which you can snowball like crazy toward.
=)
Congratulations on facing your finances and making a decision that you are "sick and tired" of your debt! That's the first step in getting rid of it. You have to get MAD about how much you've got!
Sincerely,
Lindsey Schocke
Geeks on Tap: Mission Accomplished
Sincerely,
Lindsey Schocke
Geeks on Tap: Mission Accomplished