Disneyland or pay down debt? - Page 4

[Storm Bride]

Pay down the debt. Okay - I'll admit that's easy for me to say. I freak when my credit card debt gets to $1,000, and I'd far, far, far rather go camping than go to Disney (honestly - a free vacation to Disney wouldn't be worth it to me, so....).

However, I'd do things a little differently than the OP, or most of the posters. I'd pay off the card at 0%, so the 28% wouldn't ambush me 6 months down the line. Then, I'd put the rest on the other card, and call and see if I could have that interest rate reduced. I can understand wanting to deal with the card that currently has interest being charged first, but I'd be stressed worrying about how I could possibly pay off the other card before the introductory rate caught up with me.

OP: Is the 0% card one of those ones that charges retroactive interest? I've known a couple of people who have been bitten by that one...not fun to suddenly find yourself owing 6 months worth of interest on $3,200 at 28%.

[katheek77]

Honestly, at that age (4.5 and 2) they won't remember that much, and would just as easily be please with a trip to the local lake and beach. For real.

We went to Disney world when I was 11 and my sister was 8, and, I think that was a really good age. Any younger than 6, and I'm inclined to think it'd be just as good to take them to anything new in the area and they'd be equally amused.

[sunnysandiegan]

You've gotten plenty of advice on the debt versus vacation question.

I want to mention you have choices on where to bank and which credit cards to use. Is there any way you can join a credit union for your banking needs instead of Wells Fargo, which you said you disliked? Credit unions typically pay higher interest rates and typically charge far less in fees, etc. Once you get established with a credit union, you may be able to transfer your credit card balance(s) there and pay a LOT LESS in interest.

Meanwhile, I didn't quite catch the exact details of your credit card scenario. What I understood was you have two accounts. One is currently at 0% and will be going up to 28% and this was the smaller balance. The other account was at 9% through the January cycle and has gone up to 23% for February and beyond. This was the larger of the balances. If I understood this correctly, then I would do the following:

~ With any and all money possible, I would pay off the smallest balance while paying just over the minimum on the larger balance...IF (and only IF) I could pay it off completely within a few months and definitely before the interest rate goes up to 28%.

~ Then, I would throw all I could at the larger balance.

~ Meanwhile, I would ditch the bank and go for a credit union. I'd also inquire about possible balance transfers to a credit union credit card account for the larger balance.

~ RIGHT AWAY, I would call and ask for a lower interest on the account that just went up. Tears, truth, desperation, whatever it takes...but I do typically start with honest politeness. Most people respond to human interaction, I have found. I go higher up the chain, if I feel the person cannot do what I am asking. Sometimes even calling back the next day helps. New person, fresh emotions...

~ If I was unsuccessful in lowering the BOA account interest and I was unsuccessful in obtaining a credit union credit card for balance transfer purposes, then I would start trying to find a different account to transfer that balance to in order to avoid 23% interest. That is simply inconceivable.

I think you are doing really well thinking of all the ways to bring in cash and selling off the items that perhaps got the card so high in the first place.

On a completely different note, I would seriously consider my husband's feelings in this matter. If he is working hard and feels deprived, that is going to negatively impact the entire family. It is my opinion that everyone can feel abundant regardless of the actual monetary situation. I would work on the spiritual side of feeling abundant on a daily (hourly) basis and see what miracles can transpire. Whatever your beliefs, I feel confident abundance can be found somewhere... a gratitude journal, thanking DH for his work each day, visualizing an abundant life, donating a little to others, placing a $5 bill in DH's wallet with a love note, etc.

Best wishes!!!

[katheek77]

One more thing...I thought the new stimulus package doesn't include rebate checks...tax cuts, increased benefits for those on unemployment and/or food stamps, but, I didn't read anything about there being stimulus checks included.

[Suzannah]

Originally Posted by it's just apples

I would spend $150 on a membership to the pool and go every day this summer. You're still getting something fun, and are able to throw the rest of the money toward your debt. We do the pool every morning in the summer and it's AWESOME!

This is a great idea - the pool, the zoo, a children's museum. We were broke for many of DD's early years, but we bought memberships to the zoo and the botantical gardens ($150 total for both, family memberships with guest passes) and went all the time. The cool part about it, too was that if DD had serious issues or it was too crowded when we got there we could leave without worrying about wasting money.

We are in a debt hole also and are facing the same decisions, too.

Edited: Just saw that the high interest card is with BoA. They will absolutely NOT budge. EVER. My father died, and my mom found out that he had a business account from awhile back that had $50,000 on it. She had never used it and it was in the business's name. They made her pay back every penny and did not stop charging interest. They are BASTARDS. (sorry if that's offensive, but they are offensive).

[freespirited]

I didn't expect so many responses, it's been fun reading them all, and inspiring to me as well.

I think you are right about my kids being too young for Disney and, even though we are working on dd2 being potty-trained, I don't think she would be by then necessarily and there would still be diapers to change, and honestly, the more I think about it, just getting into the park and having no budget to spend inside it would be a real bummer. I also think I'm being sentimental because dh and I honeymooned at 4 Disney parks in Orlando and had a blast, but we also got to eat in the aquarium restaurants, sample the different foods in all the parks, go back to a lovely suite every night, and we would NOT be doing that at all this time. I'm talking packing snacks and drinks, staying at the cheapest hotel within 30 minutes, etc. I grew up in L.A. so I went to Disney quite a bit as a child but I'm sure everything has changed. The traffic and pollution alone have worsened so much since 30 years ago. See, now I am talking myself out of it quite nicely instead of the opposite!

I just thought of something, I don't know if anyone brought it up already as my mind was a little foggy going over the recent posts (coffee hasn't kicked in yet), but what if I pay off the $3800 at 0% with my 5k I am expecting, then transfer another $3800 from the high interest card at 0%? Does this make any sense? Maybe that is not such a great idea though because they charge me $100 to transfer $3800 to the 0% card each time, and since I just did it, I'd be paying $100 just to extend the 0% rate from June to July. Math is not my strong suit, but it doesn't seem worth it now that I am analyzing it in my head.

Some of you suggested paying off the 0% card first, but I am not sure why. $3800 at the 24% rate is $456 in interest for 6 months. The difference in interest rates between the cards (28% and 24%) is only 4%. 4% of $3800 is $152 annually. I would be saving, minus the $100 transfer fee $356 dollars between now and June. The difference between the 28% and 24% is not that big on a $3800 dollar balance. I can't see paying that one off first being a better deal than throwing all my money at the bigger one, kwim? Please explain if you have a different POV. Keep in mind that I *think* I might be able to pay these cards off, if market conditions work in my favor, in one year. I can't see it taking more than two years.

Dh has a recession-proof job so we are good there. His boss told everyone not to worry, that they are in no danger at all of losing their jobs despite the economy. As far as my plan goes, dh seems to be coming over to my side a little more. Yesterday I told him that we could either pay our power bill ($95) and have $$350 cash for two weeks of survival, or pay it next time and have $445. He totally went for paying the bill. $350 will have to buy groceries, gas and misc for two weeks. I think that is doable. Then the next paycheck we will have more money to throw at the cc debt. I like the idea of giving him a $5 bill, but I know him and he would just use if for a need, like milk or eggs or something. It wouldn't be a treat for him. He doesn't spend anything on himself, nor do I. We both wore the same pair of shoes/boots all winter. He is really anxious to pay off the debt so we can have a better life. As you can imagine, an extra $300 a month to have around can add a lot to your quality of life.

About my bank - I am stuck with them because we have a heloc with them for 50k. My "mortgage" is another larger heloc through a relative. Wells Fargo gives us a better rate if we bank with them but man are they sharks. After our cc debt, our next goal will be to pay down our 50k heloc and get out of anything to do with Wells Fargo. That may take some time though. Our rate is really low because it's linked to prime, so our mortgages are only 4.24%. I can't imagine how we'd make it at this point if the rates rose back up to what they were last year at this time, almost double. This year they will stay low so we MUST get out of debt. Our plan was always to sell the house after 3-5 years which is why we never got a traditional mortgage. The fees were going to be 5k and it didn't seem worth it for a home we were not going to stay in longterm. If we can't sell this year or next, then we have to be prepared for rate increases, but I think we are years away from getting back to the rates doubling again so I am not too worried.

[Suzannah]

For DH and a treat, I used to buy mine a Starbucks giftcard with $5 on it and slip it in the car for him. That way he had to spend it on himself. It could also be for a place to buy lunch if he is generally a brown-bagger.

[freespirited]

Originally Posted by Suzannah

This is a great idea - the pool, the zoo, a children's museum. We were broke for many of DD's early years, but we bought memberships to the zoo and the botantical gardens ($150 total for both, family memberships with guest passes) and went all the time. The cool part about it, too was that if DD had serious issues or it was too crowded when we got there we could leave without worrying about wasting money.

We are in a debt hole also and are facing the same decisions, too.

Edited: Just saw that the high interest card is with BoA. They will absolutely NOT budge. EVER. My father died, and my mom found out that he had a business account from awhile back that had $50,000 on it. She had never used it and it was in the business's name. They made her pay back every penny and did not stop charging interest. They are BASTARDS. (sorry if that's offensive, but they are offensive).

BoA are pretty sneaky. They totally raised my credit limit even though we live below the poverty line. They just went by my credit score. I think they saw I always charged it up and paid off over the years in large lump sums so they figured I am creditworthy that way but they wanted to suck me further into debt with them out of greed. If they had bothered to ask, they would have determined I didn't have the money to justify that credit line, but I took it because I needed to transfer the high interest rate card and they offered 0% to do so. I have had bad luck with them in the past, but lately they have been unusually kind to me, I've called a few times about an over-the-limit fee (I got one for $2 over the limit!) and also a late fee and both times they reversed the charge. It was freaky. I have no idea what to expect when I call to ask for a lower rate. After what you told me, I am expecting them to say no. I did apply for one of their 7.5% loans and they totally turned me down because of my debt-to-income ratio, even though I explained I wanted it for my BoA credit card only to help me able to pay it off, so no, it doesn't look promising. They know they have people tied and they take advantage of that. Capital One were the worst for me. I will never deal with them again, ever.

This spring/summer I would like to plan more activities for the girls so we all feel more fulfilled. I took dds to a museum last fall and they had a surprisingly good time as there was a scientific toys and activity room. DD1 played on the computer making designs and the younger one played with special toys. As for public pools, the indoor YMCA one always made dd1 sick. She'd always come down with something within a few days, even in summer, so I am sort of wary. But we live near the mountains so there are rivers with little sandy beaches not far away and places to picnic so I want to do those things more often and make nice family memories/traditions. I remember going to the lake nearby with my mom and sister growing up. It was pretty much free and I loved just hanging out with my mom at the beach. I think you are all right that my dds will be just as happy to spend a summer doing these things than going to Disney, and the money we will save will take a pretty good load off our shoulders.

If we don't get any sort of lump sum payment, I think we'll get reduced payroll taxes. Right now those are $150 a month for us, so if those are forgiven, that will be a good extra payment towards the debt every month.

[freespirited]

Originally Posted by Suzannah

For DH and a treat, I used to buy mine a Starbucks giftcard with $5 on it and slip it in the car for him. That way he had to spend it on himself. It could also be for a place to buy lunch if he is generally a brown-bagger.

That's sweet of you! Dh throws a royal FIT if he finds out I bought anything from Starbucks, lol! I say something along the lines of "I don't myself new clothes hardly ever, it's my way of treating myself!" He still doesn't approve. I used to get one once a week. Not anymore. Dh comes home for lunch everyday as he works only 5 min away. I seriously can't think of anything he would do with $5 to treat himself.

[A&A]

Seriously? You actually have to ask this question?

Pay down debt.

My kids have never been to Disneyland. It doesn't have to be a rite of passage.

[Suzannah]

Originally Posted by freespirited

That's sweet of you! Dh throws a royal FIT if he finds out I bought anything from Starbucks, lol! I say something along the lines of "I don't myself new clothes hardly ever, it's my way of treating myself!" He still doesn't approve. I used to get one once a week. Not anymore. Dh comes home for lunch everyday as he works only 5 min away. I seriously can't think of anything he would do with $5 to treat himself.

My DH was boycotting them for awhile because of what happened with the Sonics (he's from Seattle), so I started giving him lunch cards (b/c he brownbags it and hates it). If your DH feels deprived, what would make him feel abundant? Figure that out and do what you can.

[Suzannah]

Originally Posted by A&A

Seriously? You actually have to ask this question?

This is pretty patronizing. Not helpful or supportive.

[freespirited]

Originally Posted by Suzannah

This is pretty patronizing. Not helpful or supportive.

I have to agree, sheesh. Yes I did have to ask the question, but no one had to reply and yet they did, with many inspiring posts, and the more I read the more inspired I felt, which you could tell if you'd read all 70 posts. I really did want to go to Disney for a variety of reasons, none of which was for "a rite of passage." I'm not like that. I liked the idea as much out of selfish reasons as for my kids to have the experience.

Not all posters here have unbending devotion to paying down debt in lieu of spending. Some of us need an extra push in the right direction.

[ChetMC]

Agree

Originally Posted by sanguine_speed

If your family had never been on a vacation or something, perhaps it would be different, but if it's only been 'over a year', then....I'd wait for a bit. We haven't gone anywhere in several years now, and probably will go this summer for a weekend getaway.

I agree. If you'd never been on a family trip, or your kids had never seen the ocean in their lives, and there were good deals to be had because of the downturn in the economy, I might say go for it. I'm all for mental health trips, and for being a little irresponsible at times for the sake of some fun, but it sounds like you've had vacations before and you'll have them again. You can find more inexpensive way to show your kids some fun.

[bender]

I was thinking about the missing relatives and not being able to see them regularly. Is there any way your family and your husband's family can use skype and do teleconference calls for free? If you have broadband access already, it wouldn't be much more to set up a camera and microphone.

I had a friend visit about 6 months ago, and he was able to sit down with his girlfriend and eat dinner, listen to music, and catch up on daily events. I had another friend who would just leave his camera on (and his mom would do the same) and as they wandered through their daily living, they'd yell from across their respective houses or just chit chat randomly.

It's not the same as being there, but it could develop family morale. Maybe the grandparents could give language lessons to your kids?

[StephandOwen]

Debt. Debt. Debt. Hands down.

And I say that as someone who is using part of her refund to take ds to disney world for 9 days this spring But neither I, nor dp, have cc debt (we both have cc that get paid off every month). If we had that debt, we'd skip the vacation.

[Jenelle]

I have to agree that there are some posters on this board who have been in their saving/not spending/no debt mindset for so long, or perhaps their entire lives... That they are not very sympathetic to those who are just beginning their journey into frugality, who are just now starting to have difficulty financially, who have only recently suffered a job loss or some other financial hardship that has brought them to this board in the first place.

OP, when I first started poking around this board, I was reluctant to post because our situation felt so bad and I honestly just needed to read and "lurk" and wasn't about to put myself out there for everyone else's opinions. I am glad that you did, though, because you seem to be learning, "inspired" as you say, and there is certainly a lot to learn from the helpful posters on this board. I do hope you will stick around and let us help and support you while you commit to digging out of your hole.

[Drummer's Wife]

Originally Posted by A&A

Seriously? You actually have to ask this question?

Pay down debt.

My kids have never been to Disneyland. It doesn't have to be a rite of passage.

sheesh, did you read the OP's updates? She sounds very sincere and grateful for all the advice. Of course, here on the F&F forum, all the wise mama's are going to recommend paying down debt, but I imagine in the real world not only do most people who take vacations have debt, it's likely many of them are using CC's to help fund those trips.

[claddaghmom]

We have a ton of debt and are planning to go to Florida if our refund pays X amount towards our debt.

But I would recommend the OP put all money towards debt.

Our situation is much different. Our COL is low and our debt is not high interest credit card debt. The way we apply our refund will wipe out the scary stuff for me. The rest is just cleaning up to get to a zero.

Also, our trip will be flight, plus hotel, plus $100 food and $100 tank rental (scuba diving). That came out to $700 total for us. $700 just seems much different from $1200.

Is there a way the OP could plan a different vacation, still in Florida or some other warm, sunny state, but nix Disneyland/world? I think last time we drove to Florida, our week long stay was $800 total and that was with 4 adults, 3 kids. And BTW we rented a minivan for it.

[Tanibani]

I have not read all the replies, so forgive me if I repeat...

Someone said your children are too young to appreciate it right now. I agree with that. I live in Ventura County and in October I purchased an Annual Pass $174 each person (me and 2 kids, DH hates big theme parks). But my children are one almost 9-year-old son and a 4.5-year-old girl. I took them for MLK day and my son thanked me, which was so sweet.

I truly think it can wait. It's OK... you will get there. (And you are right, it is crowded now. I need to get a Ph.D. in "tricks for Disneyland" to learn how to do this right.)

I grew up pretty poor and now we are well off (with zero-little debt). But I'm a big believer in enjoying all the wonderful FREE things in the area. Instead of driving to Disneyland, take a car trip to a SoCal beach (there are many) and stay in a cheap hotel.

We have a weekly Zuma (Malibu) beach playdate in the summer. It takes us 30 minutes to get to the beach. I love that I have prioritized that 4 summers ago and all my friends enjoy it.

So... my advice is... pay off the debt and feel good about how responsible you are being and conscious about it. Weekly, do something fun with the family. It be visiting the pet store to look at animals being groomed. I do that with my 4.5-year-old daughter now.

Enjoy what you have around you right this minute.

- visit the library, a local farm, a bookstore, a playground, let them ride their bikes till dark, read stories with flashlights... create memories in different ways... have a movie night in the living room with a pizza picnic on the carpet. Invite a friend. Have a kiddie sleepover (moms included).

I remember going to Maui in 2003 (I was newly pg with my 2nd) and I couldn't wait to get back home (weird!) because I missed my house and I love my life. I felt pretty happy.

You don't have to go on vacation to have a great time. Create vacation at home. I have a Little Tykes Bubble maker and I make bubbles for my kids sometimes when they take baths.