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    $50,000 in credit card debt

    I find myself in a very bad financial position. I have about $50,000 in credit card debt that I'm not sure I can pay off. Amazingly, my credit is pretty good and I had most of it on 0% cards until now, but some of the 0% time limits are coming due and I haven't been able to find other 0% offers to replace them. I'm afraid that if the balances have any % attached to them that I will soon be buried to the point where I can't dig myself out. Do you have suggestions on what course of action to take that might help me escape this endless debt hole?

    #2
    Short version:

    Spend less than you make and put the rest toward debt.

    Comment


      #3
      I'm in a same situation my friend. My wife and I got married last May and I have been trying to dig myself out of 40k of wedding debt that I put on my CC's. Not a smart move at all. To make matters worse we have lost over 100k in equity on our home. At any rate, I've found that the snow ball effect works, but it takes time and you cannot touch any of those cards while paying on them. That's good that you credit is still high. Mine has suffered since having the high revolving debt, and I haven't been able to get approved for any 0% cards either. Oh well maybe that's a good thing. No more debt to accumulate. Just curious what is the monthly your are paying on your cards?

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        #4
        It's gonna boil down to a few things:
        1. Stop using the cards, if you haven't already
        2. Cut your existing expenses to the bone
        3. Get a second job or something to bring in more income. Considering selling some of your stuff on ebay/craigslist
        4. Pay down the principal on the cards as fast as you can

        I'm guessing you didn't accumulate this much debt overnight, and you won't pay it off overnight. Don't look for an easy out...there isn't one. It's gonna take some perseverance.

        Comment


          #5
          Nothing is going to work unless you come up with a "spending plan" and debt reduction plan. The first step is get control of your spending. To do this, you need to find out how much your "fixed" expenses are, subtract that amount from your income, and the result is what you can afford to spend on discretionary expenses. This exercise gets you living within your income. What you are looking for is how much can you afford to spend on debt reduction.

          The bottom line is that you are probably spending too much on discretionary purchases, and you are not leaving enough to pay your bills, so then you put some of your fixed expenses on the credit card too. You have to start paying your FIXED expenses FIRST and then buy discretionary purchases with what is left. This will most likely be a huge adjustment to your life style. This is going to hurt at first, but then once you get your spending in control you will not believe how liberating that is. If you are married, you will most likely see a huge improvement in your relationship. I used to spend one day a month at our church's counselling center giving financial advice. I learned the #1 reason for marital problems was money problems.

          I'd love to help you through these posts as best I can. Just fire away the questions.
          Last edited by jeffrey; 05-26-2009, 06:55 PM. Reason: forum rules

          Comment


            #6
            Everyone has very valid points and comments.

            If you want us to help you further, could you please post all of your income and expenses... we might be able to help you find areas to trim. Also include all of the ccs.. and their mrc's, etc.

            Comment


              #7
              Originally posted by minnie1928 View Post
              It's gonna boil down to a few things:
              1. Stop using the cards, if you haven't already
              2. Cut your existing expenses to the bone
              3. Get a second job or something to bring in more income. Considering selling some of your stuff on ebay/craigslist
              4. Pay down the principal on the cards as fast as you can

              I'm guessing you didn't accumulate this much debt overnight, and you won't pay it off overnight. Don't look for an easy out...there isn't one. It's gonna take some perseverance.

              Excellent post.

              Comment


                #8
                Well I can honestly say that after my wedding this has been one of the worst financial years in my life. I've seen my credit go from 720+ to 600 in a year! I have nott missed any payments, but I did have one of the lines cut, and another card closed because "inactivity" which added to the mess.

                I've tried everything from applying for consolidation loans, to 0% CC, when I had better credit and no luck. "TO MANY INQURIES". So I have been paying cash for everything. It's hard not having a back up though. I have read the reviews, about how debt settlement screws your credit up, but at this point I feel that I'm already there. I will post up my #'s later, but I'm planning on being free within a 24-36months.

                Comment


                  #9
                  Wow!!!

                  A debt settlement and no interest and no enrollment fee???

                  That just sounds too good to be true.

                  Comment


                    #10
                    Originally posted by PetMom View Post
                    Wow!!!

                    A debt settlement and no interest and no enrollment fee???

                    That just sounds too good to be true.
                    Do the math she presented, they may not be charging interest but they're taking a $2k cut.

                    Comment


                      #11
                      In October of 2007, I found out my husband had $42,000 in credit card debt on 7 credit cards and the pile was growing higher every month due to finance charges and late fees as he was paying the minimum (which added up to >1K a month) and then still using the cards because he spent so much cash on making the minimums.

                      I refused to help him pay it off in cash because he got there by himself but I did coordinate the payoff effort for him because he was clueless as to what to do. This is what we did.

                      1. Stop using cards immediately.
                      2. Found extra money by stopping TSP contributions completely.
                      3. Changed health insurance during open season to premium which was about 60% less.
                      4. Stopped eating out immediately-packs lunch (leftovers) every night.
                      5. No more new clothes either. He didn't need them anyway.
                      6. Changed the deductibles on his auto insurance as well as the homeowner's insurance to save a little money.
                      7. Created new budget in which every penny counts. No more treating himself to silliness.
                      8. Snowballed cc payments, starting with highest interest rate cards. We were able to transfer a couple of them to 0% cards.

                      So it's been just over 18 months and he is down to 21K and I expect by the end of the year that he will be at 13K and by this time next year, he'll be free. From 42K to freedom in less than 3 years. He did it and so can you.

                      Comment


                        #12
                        I find that if you put everything on a spreadsheet and track it religiously you will see tangible results sooner. Start setting goals such as cc debt down to 35 K by 12/31/09

                        I have a spreadsheet that is color coded and contains the creditor name, balance due, percentage rate *and when 0% terminates, etc. Every time I make a payment I update my spreadsheet. I include my goals on this spreadsheet.

                        I do work two jobs, and do the frugal lifestyle as much as possible. Doing so I was able to pay off 20K of debt last year on an 80K income. It's possible to do much better but I own two homes and have two car pmts so that was the best I could do and I was mighty proud of myself.

                        I believe it's about having a plan and sticking to it. There are some great template on google templates. They have budgets, etc. too. I made my own spreadsheet but not sure how savvy you are with that.

                        Good luck, i know it can be done but it aint easy and it requires perseverance.

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