I'm looking to be debt free!! Need advice.

**belcher34** · 05-23-2014, 07:48 AM

Sorry for all the typo's. It's hard to type on phone keyboards.

**klarose** · 05-23-2014, 08:05 AM

When is the 0% interest up on the credit card?

If it is soon, I'd pay that off first in less than 2 months.

Otherwise I'd start putting everything you got at the personal loan. It's a little cheaper interest than the truck, but it will be gone faster and then you can knock out the car.

In the mean time, If your willing to sell the truck, that would help you a lot. If not try to refinance it. I've heard good things about Penfed, but never used them.

**Petunia 100** · 05-23-2014, 10:17 AM

So, the 8.5k in checking is the proceeds from the 7.5k loan? I hope you've learned a good lesson.

Never borrow money simply to build your credit rating. It is not at all necessary, and it is expensive. I'd suggest you just pay the loan in full, if not for that truck debt.

Do you need a truck? Do you need an expensive truck? If not, sell it. Then buy an economical car you can afford. How much is the truck currently worth? I hope you've learned your lesson about this, too.

Don't go shopping just to have something to do. Take up a sport or other hobby instead. Ideally, you could use your 8.5k to cover any shortfall of the truck's value vs. the loan, and buy a good used car outright.

Stop using your credit card to buy things you can't pay for. Buy a tank of gas per month with your credit card, and pay the bill in full when it arrives. Do this consistently and over time, your credit rating will be quite good. Plenty good enough to be approved for a good mortgage rate when the time comes.

**klarose** · 05-23-2014, 10:29 AM

Oops. I somehow forgot about the $8.5k in checking.

I agree with Petunia then. Sell the truck, use your cash to pay off any shortfall. Then work on getting rid of that personal loan.

**John213** · 05-23-2014, 05:37 PM

Do you want to sell the truck and get a cheaper used affordable car? It's really up to you.

When is the 0% interest up on the credit card?

Best advice:
Sell the truck, buy a cheaper used affordable car. Pay off the credit card when 0% is up. Then Pay off the Personal Loan. Then build an emergency fund.

Another way to go:
Keep the truck if you really want to. Pay off the credit card when 0% is up. Then Pay off the Personal Loan. Then build an emergency fund.

**Bob B.** · 05-24-2014, 06:49 AM

The monthly payment on a vehicle loan should be no more than 10% of your take home pay, financed no more than 36 months. Your truck payment is 21% of your monthly pay. You should sell the truck.

**RLM008** · 06-03-2014, 06:51 AM

Using debt eliminator software

I plugged the information you provided into some debt eliminator software that I have access too. If you would like to know how you can access to this software send me a message.

If you snowball you minimum payments you should be debt free by 2018. That is by focusing on paying off your fastest pay off first (i.e. your credit card). That should save you an overall total of about $750 that would have gone to interest and have you debt free in 2018.

If you take an extra $100 dollars out of the remaining $671 and apply it to the above strategy that should accelerate you to debt free status by an additional year (2017) and leave you with a savings of about $1,410 and change.

**Michael Thompson** · 06-03-2014, 07:32 AM

Originally posted by Bob B. View Post

The monthly payment on a vehicle loan should be no more than 10% of your take home pay, financed no more than 36 months. Your truck payment is 21% of your monthly pay. You should sell the truck.

I agree to bob. yes you should sell the truck. It will give you some relief

**Eagle** · 06-04-2014, 04:47 AM

Originally posted by belcher34 View Post

So where should i start?

I have a few idea's but i wanted someone else's input.

thank you all for your time and input

Welcome to the forums Belcher34!

Re-organizing the information provided...

Income: $2056 / month

Expenses:
$115 Insurance
$120 Rent/Electric
$85 Cell Phone
$300 Gas/Food
$75 Credit Card
$251 Personal Loan
$439 Truck payment
$75 (Not accounted for)

$671 Left over

Debt:
20k at 10% interest – Truck
7.5k at 8% interest – Personal Loan
1k at 0% interest – Credit Card (When does the 0% expire?)

You have 8.5k in checking… That’s a good emergency fund.

Questions:

1. When does the 0% offer on the credit card expire?

2. How much is the truck worth today? Are you willing to sell it? Check out www.kbb.com

3. How do you track expenses? Consider tracking your expenses as another member suggested through www.mint.com

4. $85 a month seems like a lot for a cell phone plan… Could you get on a family cell phone plan with family? You could potentially be paying $50 or less a month.

5. Have you considered paying your {car} insurance every 6 months? You could probably get a 5% discount for doing so on many insurance providers.

6. How are you allocating what is left over ($671) each month? Are you putting a portion towards your debt and a portion towards checking/savings?

7. How old are you? What have you set aside for retirement?

8. Have you considered getting a second job to supplement your income?

Welcome again... Keep moving forward! You can beat this debt and become debt free!

**Eagle** · 06-04-2014, 04:52 AM

Also check out the following posts as these might be helpful to you:

Tips to get out and stay out of debt

Imagine yourself debt free

Tips for Making Extra Money while in Debt

**belcher34** · 06-04-2014, 09:02 AM

I have a few updates! Sorry guys it took so long to respond, been very busy! Thank you all for your input.

1. When does the 0% offer on the credit card expire?

I already paid the CC off, I figured I could absorb paying it all off at once.

2. How much is the truck worth today? Are you willing to sell it?

The truck is a 2013 Toyota Tacoma 4x4 PreRunner with all the perks. I BB it and its still worth 23-26k. I could sell it to a private buyer and maybe come out okay on this, of course i'll still lose money on it, but not to much.

3. How do you track expenses? Consider tracking your expenses as another member suggested through

I know this might sound crazy, but i keep up with it all in my head. I know when and where my money is going at any moment. Maybe, writing it all down will keep me more organized and really show me on paper how much I spend where.

4. $85 a month seems like a lot for a cell phone plan� Could you get on a family cell phone plan with family? You could potentially be paying $50 or less a month.

I have verizon. My brother and I share a plan and we both pay half. Its been kinda high lately, because of no wifi. I've been looking into their new family plan that costs $160 a month with 4 phones and 10gigs of data a month. My parents are looking to get cell phones and maybe we all can split it. To make it a little cheaper.

5. Have you considered paying your {car} insurance every 6 months? You could probably get a 5% discount for doing so on many insurance providers.

Sometimes i do , sometimes i don't. I have nationwide insurance and i dont know if they give a discount for paying 6 months advance.

6. How are you allocating what is left over ($671) each month? Are you putting a portion towards your debt and a portion towards checking/savings?

Mainly I have been letting it sit in my checking/savings account.

7. How old are you? What have you set aside for retirement?

I just turned 25. I haven't set anything aside for retirement.

8. Have you considered getting a second job to supplement your income?

I wanna get a second job, but my schedule at my current job isn't really consistent enough to try.

Welcome again... Keep moving forward! You can beat this debt and become debt free!

[/QUOTE]

**Eagle** · 06-05-2014, 03:37 AM

1. Re: CC - Good call on paying off the CC. One less payment to worry about.

2. Re: Truck & Truck Loan - How do you feel about selling the truck and buying an older vehicle? Or perhaps refinancing it like you suggested� 10% interest seems rather high.

3. Re: Tracking Expenses - Keeping track of expenses in your head is probably not the best habit. Again, consider using www.mint.com or saving every receipt for a few months to see where your expenses are going. We�ve used it for a few years and have found it very helpful.

4. Re: Cell Phones - We have a similar family cell phone plan through AT&T. 10gb of data, unlimited texts, unlimited minutes and 4 phone lines. When you split up the expenses that�s $40 a month each plus taxes.

5. Re: Insurance - We have Progressive and pay every 6 months. We get a $50-60 discount for doing so.

6. Re: Excess Money - In your checking/savings account you�re likely making less than 1% interest. On the other hand with your car loan and personal loan you are paying 8% or 10% respectively. I�d take at least half of the $671 and start putting it towards debt reduction. Have you calculated how much you�re paying in interest each month?

7. Re: Retirement - At 25 you are doing pretty well in the sense that your total debt is probably around 1 years� worth of income. Does your job offer a 403b or 401k? Have you looked into starting a ROTH IRA or investing in mutual funds?

8. Re: Extra job - Is there something you could do on the side on your own? Say mowing yards, babysitting, tutoring, becoming a dog walker, cleaning homes, painting homes, delivering pizza, or getting a newspaper route? A few extra hundred a month could really boost your debt reduction momentum.

**Weird Tolkienish Figure** · 06-05-2014, 06:38 AM

Originally posted by belcher34 View Post

Hello all,

These are all the debts that i have currently have:

Truck: $20,000 left 10% interest rate $439/monthly payment

I had a great running paid off car, we didn't have anything to do so we went to the car lot just to look around and BAM! I'm leaving with this truck. Something today i still get sick at my stomach over. Whenever I bought the truck I had a limited credit history and that's why they said the interest rate was so high. So, I traded my car in and i had to put an extra $4,000 down. So i figured i pay on it for a year (june is my first year having it) and get it refinanced at my local credit union to get a way better rate on my truck.

Should I get it refinanced? Should i try to sell it? or Should I bite the bullet and just pay it off as fast as i can?

Personal Loan: $7,500 8% interest rate $251/monthly payment

I really didn't need this loan. I just got it to put something big on my credit history and to build credit.

Credit Card: $1,050 0% interest for 1st year $75+/monthly payment

Only credit card i have. A few emergency's came up and i used this card on those. Still haven't got around to paying them off.

Other expenses and my income:

Other Expenses:

Insurance: $115/month
Rent/Electric: $120/month ( I share a house with 3 other friends )
Cell phone: $85/month
Gas/food: $300/month

I bring home $2056/monthly after taxes. I also have $8500 in my checking account.

So after everything is paid for the month i have $671 left.

I stress about having the debt and i don't want it anymore because i could be just maximizing my savings by not having it. I don't struggle paying for any of this, but the debt holds me back because i could go to a different job that makes less but i'd be more happier, but i can't because i have to make a certain amount to pay for all of this. If you understand what im saying.

I bring home $2056/monthly after taxes. I also have $8500 in my checking account.

So where should i start?

I have a few idea's but i wanted someone else's input.

thank you all for your time and input

First off, you need to budget, but I get the point that you probably already realize that?

I would move as much of the truck debt to low interest debt as possible. Have you tried opening low APR cards? If you are not allowed to pay your truck directly wiht your cc you can tranfer debt from the truck to the new CC by overpaying the truck bill and putting living expenses on the card. Just have to be very disciplined about not going overboard on living expenses.

Also, the advice to sell might not be bad either.

Ultimately, sit down, budget things out and figure out where your priorities lie.

**belcher34** · 06-12-2014, 03:45 PM

Hey guys! I have more updates

I paid off my Credit Card, which most of you know by now.

I sold my truck also!! It's a big sigh of relief that I don't have to pay that payment anymore.

My payoff was $22,000 and I sold it for $25,500, so in all I lost around $2,500 all together. Which isn't all that bad I suppose.

Now all I have left is my personal loan. Paying that off shouldn't take very long at all.

So here is my updated expenses:

After paying off my credit card and selling my truck I now have around $10,000 in the bank.

Rent/Electric/Internet: $140/monthly

Cell Phone: $65/monthly (now that we have wifi at my house this has come down dramatically, since i have no overages on my data plan)

Personal Loan: $251/monthly

Insurance: $30/monthly

Food/Fun/Gas: $250/monthly

Total: $736

Monthly Income: $2130

Left over: $1394

Much better than a couple weeks ago, when it was $681 left over

I'm looking to be debt free!! Need advice.