Getting out of Debt May 2010 - Page 3

[mtm]

Congrats MyTwoAs

eirual, focused is good. Is the money going in a retirement fund? Is there a penalty or tax implication to taking it out? Oh and the ccs would go missing here too if there was that much slippage.

Selesai, welcome! What a rough year you had. I think you are smart to focus on the cc and car loan. Do you have some emergency savings? That would be my first priority.

dagny.galt, it does get easier. You don't need to say I can't afford something to anyone, just a sorry, doesn't work for us but have fun often works. And find others who are trying to get in a better financial pplace and spend time with them, it will help.

ouch on the summer school. Can ds help pay for it?

lakeruby, how was the vacation? I need to declutter too.

[Softmama]

Dh's company FINALLY got the taxes done (and yes, they paid the late fees/penalties for us as it was their delay) and good news, we are getting money back
and it is all going to the home equity loan

I'm ecstatic This tax thing has been hanging over me (we really didn't know if we'd owe or not) and now its been lifted.

We are still struggling to stay on budget so that we can pay down the home equity loan as quickly as possible. Sometimes I'm excited about how far we've come and sometimes I get caught up in how far we have to go (darn thing is quite large). one step at a time.

[eirual]

Originally Posted by mtm

eirual, focused is good. Is the money going in a retirement fund? Is there a penalty or tax implication to taking it out?

I believe the money is now just in mutual funds. There would be no penalty, it would just be taxable income.

[stanleymama]

Happy News! Dh was offered a full-time job today and he will be able to keep his part-time one with the county. Plus he is starting emt training and i am going to pick up some money cleaning for my mom. We should have our last cc paid off this fall Then our only debt will be students loans!

[Softmama]

great news Stanlleymama

[MyTwoAs]

p1gg1e - Congrats on BS3, that is fantastic news!! Of course avoiding layoffs is equally fantastic. Woo!

kith - You're describing the classic nerd vs. free spirit syndrome. I'm the nerd (but I'm also the spender, which makes an interesting combination). It also takes several months to get the budget process tweaked to where it flows smoothly. Since you have variable income that just adds more confusion to the process.

Here's some links that you may find helpful:
http://www.daveramsey.com/article/ne...ney_budgeting/
http://www.daveramsey.com/index.cfm?...entItemId=8114

eirual - Good question on lesser of two evils. I know that there are tax implications to borrowing from retirement plus you lose out on capitalized interest. Does your husband qualify for any grants? What about applying for scholarships? Good luck with the mysteriously disappearing credit cards! My husband has one card tied to iTunes and the Playstation Network that keeps getting new charges (thanks to my son) so I went out and bought a bunch of iTunes gift cards and removed the CC. I then put a passcode on the Playstation Network.

Selesai - It sounds like you've had quite a year and a half but have fared pretty well all things considering. I agree that being underwater in a home isn't much of a deal if you love the home and are planning on living in it. My sister sold her first house when the market was at its peak and obviously bought when it was at its peak. Despite a hefty down payment she's pretty close to being underwater but it is their dream house so it doesn't matter. Good luck with your goals!

Softmama - yay on the taxes getting done - wahoo!!

stanleymama - congrats on the new job and the ability to keep the existing part-time job.

[kitteh]

Thanks for the links MyTwoAs! I'll look at them ASAP.

We've already overspent a few places this month, but I've also made more than I expected to, so it is maybe working out? I just hate the variability of it all, because I feel like I'm not in control/on top of it when everything doesn't do according to plan, or when there really can't be a solid plan set in stone.

DH is going to start looking for a new job soon, so hopefully that will go smoothly and we'll find something quickly. We're thinking about looking into valet parking jobs, because DH has heard that they make good money for the equivalent of part-time work. But in order to look for valet jobs DH has to have a CA license, which will involve about $100 of expenses. He's started to save up his tips--which aren't involved in the budgeting (or, they are, but they're considered his blow money) so hopefully the license won't mean any over-budget expenditure. And if he DOES get a valet job it will be a dream come true for our income and scheduling (valet jobs are mostly at night and I'm on day shifts at the restaurant, with no real desire to work nights, so it'd be perfect. Cross your fingers for us, mamas!!)

[MyTwoAs]

My friend was a valet in Las Vegas at one of the major resorts and he earned a six figure income. I see you're in the LA area which is another great market for valets - good luck to your DH!

[She2dancer]

I would like to join in here. We havehad a rough few years, as many have, and we are ready now to take control of our lives. My DH was just reinstated in his old job, so we finally feel like we can start paying off debt instead of just surviving like we have been. I have just started exploring the DR method, so I am not entirely sure where to start, but we do have our BEF done. My next step is to sit down with DH and do a budget, but I am not sure where to start, any suggestions????
Posted via Mobile Device

[eirual]

Originally Posted by She2dancer

I would like to join in here. We havehad a rough few years, as many have, and we are ready now to take control of our lives. My DH was just reinstated in his old job, so we finally feel like we can start paying off debt instead of just surviving like we have been. I have just started exploring the DR method, so I am not entirely sure where to start, but we do have our BEF done. My next step is to sit down with DH and do a budget, but I am not sure where to start, any suggestions????
Posted via Mobile Device

A good place to start is tracking your spending and listing your expenses. If that's as far as you get for a month, then it's a step in the right direction! For me, what got me to just do a budget is realizing there'd be lots of blank spaces to allow for life to happen. This is what ours is like (we put fixed expenses in on the computer and pencil in life as it happens).

[p1gg1e]

Bump!

[MyTwoAs]

Originally Posted by She2dancer

I would like to join in here. We havehad a rough few years, as many have, and we are ready now to take control of our lives. My DH was just reinstated in his old job, so we finally feel like we can start paying off debt instead of just surviving like we have been. I have just started exploring the DR method, so I am not entirely sure where to start, but we do have our BEF done. My next step is to sit down with DH and do a budget, but I am not sure where to start, any suggestions????
Posted via Mobile Device

Definitely track your spending - it may be rather eye-opening when you see how much goes out in certain areas. Since that takes some time, I'd list all of your known/fixed expenses and then try to guesstimate your other expenses and then tweak it in the future. I believe it takes about 3 months of budgeting to get it working smoothly.

[MyTwoAs]

I have a thought-provoking question. When I listen to Dave Ramsey's Friday podcasts, he often asks the debt-free callers what happened to get them started on this journey. Why did they do it, etc. My question to you is why are you focusing on getting out of debt - why now?

For me, it is mainly because of my children. They both have developmental disabilities and although both are bright and happy children, their future is uncertain. I understand that the future is uncertain for all of our children because we honestly don't know what tomorrow will hold but especially in the case of my son, I KNOW that I face the possibility that I will need to provide long term support for him.

If I want to be in a position to provide a good life for my children in the event that they can't because of their health conditions, then I need to make sure that I have all of MY ducks in a row. We are blessed to have a huge shovel and we are also blessed to have realized that we were living wildly beyond our means and that lifestyle creep has been an everyday part of our vocabulary.

The Why Now was my husband's new job. Instead of creeping up our lifestyle we're scaling back...what better time than now, right?

[dagny.galt]

Well, ladies, I think I'm just going to bow out for this month. We got hit by Murphy HARD. Our roof was damaged by last week's storms and we ended up with some water damage. Even though the damage was relatively minor, we have to replace the roof or face more damage every time it storms again, and insurance isn't going to cover anywhere near enough of the cost. On top of that, the day after the storm, we got hit by an IRS audit notification, and it looks like we owe over $800 to them from 2008 (due to a miscalculation on our part). It's going to be an expensive (and frustrating) roadblock to our debt-payoff plan for a few months. I'll be back to the monthly thread once we're back on track with BS #1.

[eirual]

sorry to hear of all your roadblocks, dagny. There's no harm in sticking around as you work through them though.

As for the why and why now questions, I'm not sure there's one specific reason. Last summer DH and I were trying to make our one LOC joint so we could both keep better track of it. We thought we were in good shape, but in that process we had to re-apply for a whole other loan and couldn't just add on another name. That was the first time DH and I had ever been denied a loan and it was a bit of an eye-openner. We have (had??...now that we haven't used it I don't know if our rating will go down) awesome credit so it was a sign that we were heading in the wrong direction.

When we were talking with my grandparents' at the cottage we were talking about the way people spend money these days and they were saying that if you have a dual income, you should live like you only have one and save the other, ignore the Joneses. And I agreed, but we were both making crap money at the time so that just wasn't feasable if we wanted to live anywhere we remotely enjoyed (we rented a $700/mo apartment with thrift store furnishings, it's not like we were living it up). Now that we both have decent jobs I don't ever want to go back to working our tails off for peanuts. I want to be smart about what we DO have so we don't have to go back and be in that position again. We've tried the "doing all the things you should do once you grow up" plan and it got us nowhere fast, so now we're doing the "be smart and have a plan" plan and it's taking us much further much faster.

Those are a few of the reasons, but really, I was just sick of running in circles, I was feeling ready to move FORWARD!!

P.S. I was re-visitng our savings plan for this move and tuition, and as long as we can rent this place out and move in with my parents for June and July, we'll be laughing, no need to steal funds from retirement or borrow....oh, and I need to find a job out there, but that's a minor detail right?....ahhH!

[micah_mae_]

Oh oh I want to join!!

We have already paid off most of our debt..we owe $70 medical bills (to be paid on the 1st) and our car gets paid off in February BUT I'm having a baby in October and so we HAVE to get a bigger car. Our car is not big enough for 2 car seats RF'ing and DS1 will only be 2 when #2 is born. So we will have the new car too.
We also have not done any savings.

[SumnerRain]

Oooh! I need to join! Didn't know you gals were here until the MDC newsletter!! We found Dave in October 2008. We nearly lost our home and we were behind on CC payments and they took all our APRs up to 30% and raised our minimum payments. $600 payment on a 4k limit at 32% for a payment that was TWO DAYS late! We were fed up. I found Dave on XM by accident and we jumped in with both feet. Scraped together $$ for FPU and things started falling into place. DH applied for a promotion in the company and got it, which was a huge raise.... on the other hand it meant 50-100% travel.

In February he left for a year in Iraq, but before he left I was able to finish paying off my midwife. Since then we have paid off four credit cards and a student loan. We have one credit card left, another student loan, and my auto loan. We are 52.4% through babystep #3, but later this year that will drop down to 40% when that student loan comes out of deferment since we have not included it into the snowball yet. I am hoping the next time he has to go to Iraq or Afghanistan or wherever they send him (probably in January or February) we can use that year to get to 85-90%+, especially since we will not need to be saving as aggressively (we had to pay for a cross country move that was only partially reimbursed).

We also have a goal to be able to sell our home in Colorado sometime. We have tenants with a two year lease right now, and we are renting up here in Washington. I am hoping either they sign another two year lease in 2012, or we will be able to get what we owe at that point.

[Julia Rose]

subbing to this thread

[stanleymama]

The "why" we are doing this is because we know the freedom of being debt free and to teach that to our kids is priceless. I want my kids to know how to handle money, the value in saving, the freedom to live life without debt hanging over there heads. Like Dave says, we want to live like no one else.

[scrandall1173]

Going Debt-free

Hi all,
I'd like to join this thread if possible. We are in the debt pay-off stage. We went Dave Ramsey style debt-free last year but then bought a house and well, it's been an adjustment. So now we have some debt that we need to clear and figure out how to make needed repairs to our new house.

So I guess we "relapsed"' and I think this thread will really keep me focused on getting back on track.

Thanks.