Need help is getting rid of debt

[neatdesign]

I agree ^ we are working on getting rid of all the non-necessities we currently have (gym, cellphones, internet, cable, going out, cigs)...

Phew... Several people had mentioned cutting out cigarettes among several other things, and until now you addressed cutting out everything BUT the cigarettes. I'm glad to read that. Cigarettes (all tobacco products, really) result in completely needless spending, if you ask me.

Thank you, we are both very happy that we are this far ahead in life to have our home, vehicles & dog living happy at our age.

Now that you've confirmed you have one dog, I'd also like to join the others and question your spending $50/month on dog food. For one dog that's excessive. Even in her active, younger years, my dearly departed dog Andie, an Akita, weighed 100lb but I never paid more than about $30/month on her food.

Of course, it could be that your dog has an allergy that requires a special diet, but if not then I say ditch the fancy stuff and get something cheaper. You can always add some variety by giving the dog an occasional piece of fruit or something similar to keep the pooch happy.

~ Jenney

[christine quast]

I agree that asking for cash or gift cards to places like target or walmart is the best way to go. If you receive gift cards from those places then you can shop for food and other needed items and eliminate those bills for possibly a couple months, leaving you to use the money to pay off your debt. Start with the best buy debt with is 0 interest for only 6 more months so you do not want to be hit with another big payment with a huge interest. After you have paid this off, get rid of the old navy since this is your next highest interest and also the smallest debt. If you continue to make the same payments it will probably take you 2 years to pay off this debt. After that get rid of your credit card debt and also stop charging so much unless you can pay off the balance each month. Then work on the second home loan, the car, until you have only the first home loan left. I would try and see about bringing in more income, such as another job, or garage sales, selling items you do not need anymore. If you stopped going out, stopped smoking, got rid of cable/internet, and got rid of anytime fitness, then you would have an extra $340 a month to pay down your debts. You could also try to get a cheaper cellular phone service if you can get out of the contract. If you did this and took the extra $340 and added it to your best buy payments you could easily pay it off. Then once that is paid off take the total payments and add it to the next debt payments and pay it off. If you keep doing this it will free up your money to be able to pay off all your debts faster then you can be debt free quicker.

I also added up your monthly expenses that you listed and it came to $2352 which means that you are $352 over budget each month, which even though your water is every three months that still means your over $278. You are spending way to much each month so you will need to cut out any extra things such as smoking, cable/internet because you cannot even afford them right now. So i think your goal would be to get another part time job or a weekend job, anything to get more income of at least $400 a month but preferrably more if possible so you can take that money and pay off your debt.

[americangolden]

Things have been going well since I last posted. Fiance has a new fulltime job 40 hours a week and we got rid of some expenses. Things are going slow but looking good !

[jIM_Ohio]

I am going to be 24 years old in a month and my fiance is 22. We own a home and think we are doing good in life for our age but we are getting a little over our head in debt.

We are getting married August 7th of this year and I am hoping to get help from people here at this forum to get our debt under control before then. I wrote down all of our loans & bills for each month. I don't know where to begin right now we are just making minimum payments to everything and it's not getting us anywhere.

Any help would be greatly appreciated in helping us work on our way to becoming debt free.

Our monthly income is as followed
Me - $1350
Fiance - $650
-----------------
Total - $2000

Here is a list of loans that I want to eliminate

Best Buy Loan
Balance - $1,345.20
0% Interest if payed off by 9/3/2010
If not payed off by that day 24.24% interest rate
Monthly Payments - $16 (which is the minimum payment)

Car Loan
Balance - $3,977.10
6.5% Interest
Maturity date - 6/1/2013
Monthly Payments - $114

Visa Credit Card
Balance - $2,720.54
Credit Limit - $9,000
18.99% Interest
Monthly Payments - $63

Loan from Father
Balance - $1,350
0% interest
Monthly Payments - $50

WHEDA Home Loan
Balance - $88,842.35
Maturity Date - 10/1/2038
6.5% Interest
Monthly Payments - $810

WHEDA Home Loan #2
Balance - $3,789.02
Maturity Date - 10/1/2013
8% Interest
Monthly Payments - $40

Old Navy
Balance - $344.91
22.99% Interest
Monthly Payments - $18

Here is a list of monthly bills I have

$810 - Mortgage Loan
$40 - Mortgage #2 Loan
$16 - Best Buy Loan
$50 - Dad Loan
$114 - Car Loan
$63 - Credit Card
$65 - Anytime Fitness
$18 - Old Navy
$104 - American Family Insurance
$95 - US Cellular Cell Phone Bill
$74 - Water Utility (Every 3 Month Bill)
$85 - Natural Gas Utility
$53 - Electric Utilities
$240 - Food
$150 - Gas For Cars
$50 - Dog Food
$95 - Cable/Internet
$30 - Cigarettes
$150 - Going out

Problems like this are best broken down into 3 variables

1) Income
2) Spending
3) Debt management

Each of those has pros and cons, and sub categories...

but here is what I see focusing on each

1) Income- 2k per month
is this gross or net?
what is your typical tax return? Being married should help increase normal tax returns

2) Spending

$810 - Mortgage Loan
$40 - Mortgage #2 Loan
$16 - Best Buy Loan
$50 - Dad Loan
$114 - Car Loan
$63 - Credit Card
$65 - Anytime Fitness
$18 - Old Navy
$104 - American Family Insurance
$95 - US Cellular Cell Phone Bill
$74 - Water Utility (Every 3 Month Bill)
$85 - Natural Gas Utility
$53 - Electric Utilities
$240 - Food
$150 - Gas For Cars
$50 - Dog Food
$95 - Cable/Internet
$30 - Cigarettes
$150 - Going out

I add this up and see $2302

So issue 1 is budget does not balance- you need $300/mo just to break even
Eliminate going out
reduce car insurance
and maybe you get to point where you only spend $2000/mo
that will prevent hole from getting deeper.


3) Debt

focus on these items

Best Buy Loan
Balance - $1,345.20
0% Interest if payed off by 9/3/2010
If not payed off by that day 24.24% interest rate
Monthly Payments - $16 (which is the minimum payment)

Car Loan
Balance - $3,977.10
6.5% Interest
Maturity date - 6/1/2013
Monthly Payments - $114

Visa Credit Card
Balance - $2,720.54
Credit Limit - $9,000
18.99% Interest
Monthly Payments - $63

Loan from Father
Balance - $1,350
0% interest
Monthly Payments - $50

WHEDA Home Loan
Balance - $88,842.35
Maturity Date - 10/1/2038
6.5% Interest
Monthly Payments - $810

WHEDA Home Loan #2
Balance - $3,789.02
Maturity Date - 10/1/2013
8% Interest
Monthly Payments - $40

Old Navy
Balance - $344.91
22.99% Interest
Monthly Payments - $18

and sort by interest rate

24.24% interest rate Best Buy Loan Balance - $1,345.20
22.99% Interest Old Navy Balance - $344.91
18.99% Interest Visa Credit Card Balance - $2,720.54 Credit Limit - $9,000
6.5% Interest Car Loan Balance - $3,977.10 Maturity date - 6/1/2013
8% Interest WHEDA Home Loan #2 Maturity Date - 10/1/2013
6.5% Interest WHEDA Home Loan Balance - $88,842.35 Maturity Date - 10/1/2038
0% interest Loan from Father Balance - $1,350

I put car ahead of house because house is appreciating asset, car is depreciating asset, so pay off depreciating assets first is generally good thinking.


You listed some key information... and that is the visa has about $6000 of room on it. Here is what you do. Pay down old Navy- get rid of the debt- $344- as soon as possible. If you cannot pay it off, transfer the balance to the visa- it will save you the minimum payment on old navy each month.
When the best buy financing kicks in, transfer that remaining debt to the visa card
call the visa card now and try to get that rate reduced
then when you transfer, call them again and try again

very important to make on time payments to the visa, as you want that rate to stay low while you use that balance to consolidate the debt


You cannot finance your way out of debt, but you can use available credit to consolidate payments. Better to make only 1 payment than to make 10, if all 10 are charging you high interest.

I would use wedding money to pay down the debt- as debt can be a burden and stressor. You will learn a lot about spouse in first 5 years of marriage, so make sure spouse is on board with that, and learn together.