Need Advice..

[maat55]

Thanks everyone for the advice.
i am paying $10 for roadside assistance for my old camry. It is very old and not reliable anymore. I have to find out if I could reduce it to $5 per month.

Maat, I bot a new minivan recently about 3 months ago. I wish I had asked you guys advice before buying it. now if i try to sell it, i would lose nearly 3 to 4K right. do you still think its a right idea selling it? and another one for say 10k..

Every way you can reduce debt is a step in the right direction. Save and buy a 1k to 2k car and sell the other. Oweing 3k or 4k is much better that 10k and up. You need to forget that you will loose on the hand and focus on damage controll and debt reduction on the other.

I'm not telling you anything I would not do myself. I'm in the process of selling my paid for truck worth 7,000 to get a 3,000 gas economy car. I sold my motorcycle recently because the numbers and the risk didn't add up and used the money to finish my EF. You make decissions and sacrifices for a reason. Think of your finances as a business, would you do the things your doing in that mindset? Think outside the bun and you will begin to prosper.

[disneysteve]

I see a slew of luxuries that can go temperarly:

House cleaning 75.00
cox down grade ?
pest controll 15.00
gerber 19.00
security 35.00
Honda sell 541.00
beauty stuff 80.00
car wash do it yourself 20.00
resturants ?

maat makes a very good point. There are a bunch of things you could cut out temporarily. That doesn't mean you can't reintroduce them later.

The only one on the list that I probably wouldn't cut is the security system as I think that one is too important to do without. Also, your home insurance probably gives you a discount for having it, so cutting it out could raise your premium.

[LivingAlmostLarge]

What do you owe on the Honda? How long do you normally keep your cars and why did you buy a minivan? Are you just going to replace it with another minivan, meaning you have a lot of kids and can't find in a sedan?

If so, I'd consider keeping it. Depends on the situation.

Keep the security, I'd sleep better at night too.

[disneysteve]

Personally, I wouldn't sell the car. You aren't in any financial trouble. Your expenses are $3,000/month less than your income, so you already are living below your means. If you cut out a bunch of the other stuff, you can free up a few hundred more. It just doesn't make sense to me to take a loss of thousands of dollars by selling the car.

[FoolFromAZ]

I bot this odyssey about 3 months ago. I had been driving camry which i bot in 2002 (it was 5 yr old when I bot that car). yr ago camry started giving all kind of problems and i have spent nearly 3k on camry in the last 1 yr. moreover my wife's office is 20 miles away from our house and my office is 10 miles further away from her office. i drop her at her office and drop my daughter in a daycare close to my wife's office and go to my office. so i drive about 1 1/2 hrs one way everyday. we decided by buy a vehicle which i should enjoy driving and should be more spacious. then we decided to buy a minivan as we are planning to keep this van for next 10 yrs and we are planning to have next baby in 2 to 3 yrs. i was in dilemma between semi old like I bot my camry in 2002. but decided against it as i dont want to change car again in 5 yrs. then we chose odyssey and bot it for 27k including tax, security alarm, gap insurance, extended waranty. i still keep my camry as i wont get anything if i sell that car. it has some dents as well.

[FoolFromAZ]

What do you owe on the Honda? How long do you normally keep your cars and why did you buy a minivan? Are you just going to replace it with another minivan, meaning you have a lot of kids and can't find in a sedan?

If so, I'd consider keeping it. Depends on the situation.

Keep the security, I'd sleep better at night too.

i put only 1k down when i bot. i still owe 25.3k.

[FoolFromAZ]

Personally, I wouldn't sell the car. You aren't in any financial trouble. Your expenses are $3,000/month less than your income, so you already are living below your means. If you cut out a bunch of the other stuff, you can free up a few hundred more. It just doesn't make sense to me to take a loss of thousands of dollars by selling the car.

yes $3000 less than income per month provided we dont contibute anything to 401k or roth ira. if we max out our roth ira and put 5% to 401k, it will reduce the amount to about $1500, which is what i was thinking to do. i have not contributed to 401k so far.. but i dont want to waste my time anymore. i am hoping that our salary wud go high as we gain experience. so we pay the cc debt if not this year maybe next or after 2 yrs. but we want to put as much as possible towards retirement..

[LivingAlmostLarge]

Keep the car. It's not a terrible car but cut out all extras and pay it down a lot faster. I would consider starting retirement as well.

[disneysteve]

if we max out our roth ira and put 5% to 401k, it will reduce the amount to about $1500, which is what i was thinking to do.

I think that's a good plan. Plus, that $1,500 will climb by a few hundred when you cut out all the other stuff. All of that can go toward debt repayment.

[aida2003]

My wife got 5 flats in less than 2 months. We were sure glad we had AAA then.

For my curiosity: did she need to pay for fixing her flat tires? Here in NC, I remember paying $15 to fix one on the spot. Our basic membership for 2 people costs $64/year.

[disneysteve]

For my curiosity: did she need to pay for fixing her flat tires? Here in NC, I remember paying $15 to fix one on the spot. Our basic membership for 2 people costs $64/year.

AAA didn't fix the flats. They just put on the spare. I took the flats to the tire shop. Fixing them was covered by the road hazard coverage on the tires.

[aida2003]

To FoolFromAZ: What kind of insurance from Gerber do you have? How much will it accumulate in a 20-year frame for your DD's education? Is it really worth $19/mo.? I know it's very little $$, but sometimes that's how money get sucked away......
Do you have any life insurance for yourself and DW?

I'm also VERY debt averse and I'd chop the debt ASAP even if that means tightening the belt for 8-12 months.

Your grocery spending is very reasonable, but what kind of entertainment do you do for $300/mo.? Could you cut to $100/mo for a while?

That's probably not my place to criticize your lifestyle, but when/how do you both spend your time with DD if you both work FT and then camp out in front the TV in the evenings and on weekends? I would definitely cut TV package to the minimum available.

In my family, we don't like watching TV, but we read a lot. So, yesterday I told my DH that we'll cancel local newspaper subscription because DD plays with her toys and asks daddy to join, but for him the darn newspaper is more important . That drives me nuts. Well, on the other hand we'll have the 2nd child in less than 2 months, so our hands will be full. Therefore I see no need to spend $37*2 (semi-annually).

[aida2003]

AAA didn't fix the flats. They just put on the spare. I took the flats to the tire shop. Fixing them was covered by the road hazard coverage on the tires.

This is new to me. What kind of tires/what place did you buy to get road hazard coverage on them? Did they cost more to get the coverage?
We get only FREE rotation. Sure each time we come for a rotation we stay stubborn and decline other services e.g. you need power steering flush or something like that, etc....

[disneysteve]

Anytime I've ever bought tires, there was an option to get road hazard coverage. It costs a couple of dollars per tire. Just like any insurance, sometimes it pays off, sometimes not.

[noppenbd]

yes $3000 less than income per month provided we dont contibute anything to 401k or roth ira. if we max out our roth ira and put 5% to 401k, it will reduce the amount to about $1500, which is what i was thinking to do. i have not contributed to 401k so far.. but i dont want to waste my time anymore. i am hoping that our salary wud go high as we gain experience. so we pay the cc debt if not this year maybe next or after 2 yrs. but we want to put as much as possible towards retirement..

Good job on paying down your CC debt so quickly. In March you had $55K according to an older post, so that means you have paid down $5K per month, while incurring a temporary job loss. I think that is great. At your current income, if you forgo 401k contributions for 12 months or so you could be completely CC debt free (faster if you cut your bills a bit). So it is really up to you, whether you are comfortable with debt or not. Personally I would not be comfortable with that level of CC debt and would stop the 401k contributions to get it eliminated. Your wife found a job quickly but if she had not you would have had to cut a lot of expenses quickly with no EF. So if it were me I would stick to the plan, pay down the CCs, then start funding EF and 401k/Roth in tandem.