2week snowball effect.........

[luvnspnful]

I'm so excited! from the 2 wks I've lurked and learned valuable info at this site, I became truly motivated. I even purchased TMMO and read it cover to cover in bedtime reading stretches. Gives me hope Here's a quickie breakdown on my progress:

april start:
total CC debt: $17915.29- broken down into these amts;
Visa: $9118.35.... made 1 payment of $1000 ( income tax refund) and another today of $18.35... ending total: $8100

Amex: $5623.94. payment today of $323.94.... ending total: $5300

Line of Credit: $3172.92.... payment april 16 of $250, and another of 29.22 today. ...ending total: 2900.

total monthly payout: $1615.29. and my budget was $1400

Great start if I do say so myself I cant bring myself to only pay minimums on the smaller amounts. I must pay it to an equal amount. the great thing is that according to my snowball calc, i will be debt free for the first time in 9 years within 11 MONTHS(not including my car loan....that'll take me 3 yrs). WOOHOO.

thanks to everyone for all that you share and the encouragement ive received from this wonderful place.

[JanH]

Wow, what a start! That's great! Your needing even amounts sounds like my Hubby. He has to pump gas to an even amount--has to end on a zero. lol

[luvnspnful]

Lol on your hubby. Im the same way. Must be a Type A personality thing or the fact I'm a Taurus. I just find it helps me see my progress easier, and do some mental math in a jiffy.
Thanks for your encouragement

[puck36]

Originally Posted by luvnspnful

april start:
total CC debt: $17915.29- broken down into these amts;
Visa: $9118.35.... made 1 payment of $1000 ( income tax refund) and another today of $18.35... ending total: $8100

Amex: $5623.94. payment today of $323.94.... ending total: $5300

Line of Credit: $3172.92.... payment april 16 of $250, and another of 29.22 today. ...ending total: 2900.

total monthly payout: $1615.29. and my budget was $1400

If you are truely doing the Debt Snowball you would have to do the following.

1. List Debts smallest (amount) to largest.
1a. Line of Credit - $2900
2a. Amex - $5300
3a. Visa - $8100
2. Make the minimum payments on all debts
3. Take any extra money and pay down the smallest debt
4. Once the smallest debt is paid off, take that payment/extra money and add it to the next smallest debt.
5. Repeat Step 4 until you are DEBT FREE

I followed Dave's Plan and I was debt free within 2 years. By following the Debt Snowball, I found myself making 3 payments a month on my car. Each payment was $251.81 ($755.43).

Read what Dave says about the Debt Snowball.
Dave Ramsey's debt snowball plan - a great way to get out of debt

[luvnspnful]

i have DR's TMMO. im only using it as a guideline. im paying highest interest debt first (visa is 18.5 %, vs 10% for my LOC). i took the debt calulator payments and upped them to pay the interest down faster. if i only pay the true DR way, it will take me 18 months instead of 11 to be debt free. the visa has balance insurance on it that costs roughly $55 monthly on top of the interest, making the finance charges more than the minimum payment. that, and the finance charges of almost a hundy on the amex are more than my biweekly car payment! ergo, paying the biggest balance first, and so on. once the visa is paid off, i will switch wholeheartedly to the purest snowball method

[tinapbeana]

it's not about which method is the right or wrong one, it's about which one is the right or wrong one FOR YOU. if paying the highest interest rate off first is what will keep the OP motivated, then by all means do it. if you're someone who likes to see results fast, paying the lowest balance off first might be the method that works for you. doesn't really matter which one you choose, the difference in interest is typically only a couple hundred dollars over the course of a few years. what matters is that YOU DO IT and are motivated to KEEP DOING IT.

congrats to the OP for finding a method that works for them

[Ima saver]

I agree with tina, just do what works for you and keep up the good work. What does TMMO stand for?

[disneysteve]

Originally Posted by Ima saver

What does TMMO stand for?

Total Money Make Over

[Homebody]

Thanks Steve and Ima. I was wondering that too. I was thinking Dr. TMMO. What doctor has written a book on money?? But then I call customers, patient's. Comes from being in health care support for over 30 years I guess.

[autoxer]

Originally Posted by luvnspnful

i will be debt free for the first time in 9 years within 11 MONTHS(not including my car loan....that'll take me 3 yrs). WOOHOO.

When all of your credit cards & line of credit are all down to $0, then you can snowball all of those payments on the car loan & it will be gone in much less than 3 years.

Originally Posted by luvnspnful

the visa has balance insurance on it that costs roughly $55 monthly on top of the interest, making the finance charges more than the minimum payment.

$55/month for balance insurance? Is that necessary?

[anonymous_saver]

Originally Posted by luvnspnful

i have DR's TMMO. im only using it as a guideline. im paying highest interest debt first (visa is 18.5 %, vs 10% for my LOC). i took the debt calulator payments and upped them to pay the interest down faster. if i only pay the true DR way, it will take me 18 months instead of 11 to be debt free. the visa has balance insurance on it that costs roughly $55 monthly on top of the interest, making the finance charges more than the minimum payment. that, and the finance charges of almost a hundy on the amex are more than my biweekly car payment! ergo, paying the biggest balance first, and so on. once the visa is paid off, i will switch wholeheartedly to the purest snowball method

What is the interest rates on your car and your Amex card?

Also, I just wanted to say congratulations, being debt free in 11 months is not that bad at all. Good job!

Did you set aside a small amount of money for an emergency fund first? Just curious, because you may want to set aside a few hundred dollars at a high interest rate so that if an emergency happens, you don't have to use those credit cards again.

Have you tried to lower your rates on your cards at all?

[luvnspnful]

good morning all!

to answer a few questions:

- the $55 on the balance insurance stinks, but RBC wouldnt let me cancel it as apparently its part of the original contract(i wouldnt have accepted this act if id known that). i tried to drop it, but im stuck. grrr
-i tried to lower all my interest rates, but was told I had to switch to new cc products to do that........that would kill the age of my accounts, and I dont want more cards.
-the Amex is 16.99%.......as soon as the visa is paid off, im attacking it in a huge way. should be paid for by Mar '08.
-car loan is 8.5%- chrysler is a PITA. im getting my utilization down to under 50% then im trying at work again for a LOC- we get 3.8% below standard as employees. should save me couple grand in interest.

EF has 2900.......2nd EF has 1100. im aware i should use some of it towards debt, but im in the middle of a seperation from the Hubster, and if things get ugly, i need that cushion to survive on.
-after snowballing on Cc is done, im going to save more, but pay double on the car each month. i could be really aggressive, but want more $ saved in a high yield GIC.

thanks to all for your help and support.

[autoxer]

Originally Posted by luvnspnful

- the $55 on the balance insurance stinks, but RBC wouldnt let me cancel it as apparently its part of the original contract(i wouldnt have accepted this act if id known that). i tried to drop it, but im stuck. grrr
-i tried to lower all my interest rates, but was told I had to switch to new cc products to do that........that would kill the age of my accounts, and I dont want more cards.

Combining the balance insurance with the interest rate, gives an effective APY of around 26%. You could save a lot of money in interest/balance insurance if you could do a balance transfer to a card with a lower rate. You don't have to close your old account, so you can keep it's history on your credit report.

[luvnspnful]

Originally Posted by autoxer

:e APY of around 26%ek: .

I think I just threw up in my mouth a little . I didnt do the math on that one........in a way glad I hadnt. yikes........I 'spose I could transfer about half the balance on that visa to my PLOC and the rest to my lower rate visa ( which has 0 balance) and save a bunch, but not until after the $1800 of my BT is paid for( hopefully in june). then im moving that heart-attack inducing portion over. Thanks for the heads up

Does anyone know of any decent low % cards in Canada? we dont get all the different offers like the USA. thanks much

[krayziebone33]

Originally Posted by luvnspnful

I'm so excited! from the 2 wks I've lurked and learned valuable info at this site, I became truly motivated. I even purchased TMMO and read it cover to cover in bedtime reading stretches. Gives me hope Here's a quickie breakdown on my progress:

april start:
total CC debt: $17915.29- broken down into these amts;
Visa: $9118.35.... made 1 payment of $1000 ( income tax refund) and another today of $18.35... ending total: $8100

Amex: $5623.94. payment today of $323.94.... ending total: $5300

Line of Credit: $3172.92.... payment april 16 of $250, and another of 29.22 today. ...ending total: 2900.

total monthly payout: $1615.29. and my budget was $1400

Great start if I do say so myself I cant bring myself to only pay minimums on the smaller amounts. I must pay it to an equal amount. the great thing is that according to my snowball calc, i will be debt free for the first time in 9 years within 11 MONTHS(not including my car loan....that'll take me 3 yrs). WOOHOO.

thanks to everyone for all that you share and the encouragement ive received from this wonderful place.

This is actually a heck of a start. Keep it up.

[thekid]

Originally Posted by luvnspnful

Does anyone know of any decent low % cards in Canada? we dont get all the different offers like the USA. thanks much

Canadian here. I do get quite a bit of low interest rate for initial start off period (say 6 months) offers by unsollicited mail from major banks. I never paid much attention to them before they hit the garbage (I pay my balances in full each month), but they do exist. I know HSBC Canada and RBC are among some of the senders from the top of my head. It would pay to look it up by calling several banks.

However, with an effective rate of 26%, it wouln't be hard to beat. Just tell RBC you're switching your balance to the competition if they don't remove the insurance charge. Should they refuse, you shouln't have trouble finding cards with an effective rate around 18% (probably lower rates for an initial period).

Do you have any room in your 10% LOC? Switching higher rate CC debt to your lower rate LOC would make sense.

[Ima saver]

I don't think you should touch either EF to pay off debt, right now.

[luvnspnful]

hiya! had to have me a nap after work before i posted....

TheKid: thanks for your post. and nice to see a fellow canuke. Im going to try your suggestion, and see if they play ball. Amex is offering 3.99 BT for 6 mos on the Airmiles card so Im gonna call them first and then Rbc and offer to defect. My LOC has about 3k worth of room on it right now- but my plan was to pay down the last 1800 of my BT that I just put on the RBC visa ( at3.9%) first before moving the whole thing over. cant see any point in paying 10% on the amount earning lessinterest, kwim? gotta love the CreditCardShuffle...hehe.

Ima: I agree with ya....too scary to empty the Ef fund out right now. Im still adding to it tho........last 2 wks alone I put in 325.

thanks again to all who replied...much abliged

[greedy4chips]

Originally Posted by luvnspnful

- the $55 on the balance insurance stinks, but RBC wouldnt let me cancel it as apparently its part of the original contract(i wouldnt have accepted this act if id known that). i tried to drop it, but im stuck. grrr
-i tried to lower all my interest rates, but was told I had to switch to new cc products to do that........that would kill the age of my accounts, and I dont want more cards.

Are they suggesting you open a 2nd acct with them at a lower rate? If so I would jump on that in a heartbeat! Otherwise transfer it to the first decent offer that hits your mailbox. Keep the old account open so the average age of your accounts doesn't drop, cut up the card on air on Dave Ramsey's show and avoid using the new card.

Otherwise you are doing great and your plan will work even if it isn't truly Dave's snowball method. I like your plan for your situation!

I have yet to understand the benefit of purchasing credit card insurance. Correct me if I am wrong, but doesn't it only offer you no monthly payment (and balance does not accrue interest) if you lose your job or are unable to work due to injury? I have never seen one that actually makes your monthly payment or reduces your debt other than no interest accruing.

Add in the almost 9% per year interest rate on your outstanding debt and you will take forever to see the card balance at $0.

I am not knocking you at all just venting about the ridiculousness of cc insurance.

[luvnspnful]

hello...... me again . Things are lookin' up. Since my last post I have paid:

visa: $818.21...new balance:$7500

amex: (made a few purchases totalling $323- two CRA monitoring services plus some clothes/shoes for the kiddo, and mother's day), and 2 payments totalling $569.01....new balance :$5198.

LOC: $250.....new balance $2600.

DEBT GRAND TOTAL: $15298 ....in just 5 wks I've shrunk it 2k!!!

COOL STUFF: RBC visa autoCLI 'd me to $13500, TDVisa auto CLI ( just yesterday!) to $7k, plus they gave me a $3k O/D on auto.

I found a deal for a 0% card/12 mos that I applied for and think I will be approved for (since they called me at work to verify phone #s and stuff) that I will BT the Visa and Amex to.

thinking my credit score is going up up up