Need some advice

[veronak]

Ok I start my part-time job tomorrow, I owe about $4650.00 in debt not including the $1300.00 in student loans ;which I have a forbearance for at this time. I live at home and really want to purchase my own home. My credit score is 615, not good . Any way I was thinking either deposit my part-time check into my $20.00 challenge account ; this money I am saving for a new house and live off of what I make now.With my income now I do pay extra on my high interest credit card and plan on moving to the next once it is paid off. Or should I split the money, I was thinking half to my EF, then split the other half between my debt and my $20.00 challenge account, by doing this about $100.00 will be placed in the EF account and $50.00 each to debt and 20.00 challenge account
So let me know what you guys think, I am really gearing towards not touching this fund and just depositing the entire amount with the exception of $5.00 to my IRA account right now I am only contributing $30.00 a month this will increase my contributions to $40.00 monthly...wish I could do more but I figure something is better than nothing

[Haku]

Good for you, veronak!

Well, naturally, you'll get lots of answers, and frankly, they're not going to be all too different or that bad. I think, in the end, you should do whatever is comfortable to you.

As you probably know already though, I'm mostly a numbers kind of guy, which means I'm looking at where I do the most bang with my buck. In your case, I'm going to have to say the CC, perhaps at the expense of everything else. On top of that, it's also simple and straightforward, albeit not as glamorous as being able to brag about having all these accounts.

Of course, if you insist on contributing to the EF, IRA, or the challenge account, that's fine too. Nothing wrong with that. Whatever you feel is best.

If you don't have a preference though, I say go hack down the CC as fast as you can.

[debtdude]

Aim as much as you can towards your debt.

Let's say you have a credit card with a 23% apr. If you were to split money - some in savings/ira/whatever and the other towards credit card, you'd need the interest of the saving/money market/whatever to EXCEED the interest of the credit card to make any money. Unless you've got a single stock that's going gang-busters, pay your CC down first then move one.

I'd also hold back on the whole "buy my own home" thing. Or at least pay on that in a few years out. You don't want to be declaring bankruptcy or forfeiting your mortgage because you jumped the gun on home buying too early.

[PrincessPerky]

I'll ditto the CC thing, but I understand about the living at home problem...I would split the money for the house and CC, if you must get out..(I left home early so I really do understand needing to get out)

[JoyJoy]

Most of us were raised with family values to help our family and our friends when they needed it. We are really enablers helping them when they won't take care of their own affairs. We do have to step back and say "NO MORE!!!"

I was watching Joyce Meyer (female evangelist) today and she was talking about this very same issue. http://www.joycemeyer.org The message for today on TV 5/18/06 was dynamite! I have to agree with her that sometimes we do it for approval so we won't be thought of as uncaring. (you can listen/watch to it on the website if you want to.)

Sometimes you have to walk away from a bad situation with family and friends for your own sanity. Pray for them and know that God in is control.

[cbmeeks]

Hate to be a Dave Ramsey fan-boy, but his plan works.

Get his Total Money Makeover book. Seriously, you can find the paperback for well less than $20. Get out of debt BEFORE you start saving for a house. It sucks to live with parents, but 30 years of debt sucks more.

If you save for a house while you are paying debt, you will pay more interest and save less for the house. No debt = more money. Period.

[wwjdmsl]

Yep....get debt free before looking at buying a house and when you do, ensure you go with a 15 year mortgage ...Do you have a sufficient emerg fund in place now (~1000.00?)?

[veronak]

EF is funded

I was just wondering... how did you find out your credit score? I'd like to find out mine...

[sweeps]

myfico.com or any of the credit reporting agencies, for example experian.com.

Most of them have a credit watch product that you can try free for 30 days and get your credit score (then just cancel before the end of the trial period).

Thanks, mine is 726... hmm

[veronak]

FYI guys:
Well my friend strikes again she called me last night to help her figure out her hourly wages and after a year of working she realizes that she was making $2.00 an hour less than what was agreed upon. Of course she has decided to speak with the boss, which I informed her was a bad idea since technically she has agreed to this amount for the last year with out any questions. But she is her own person who makes really bad choices without thinking first and if you don't agree with her she thinks you have no clue but who I am to say anything