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Hello, I am new to Saving Advice. I have $44000+ in consumer debt due to stupid decisions I made and want to make a serious effort to paying it down as soon as possible. Here is a list of what my debts, income and budget are going to be. Please give me any feedback that you think might be helpful.
First, some background about my living situation. My partner and I live together in a rented apartment. He is disabled, and does a part-time job. Each month he brings in ~$800, and I earn ~$3600. We keep our finances separate. He has no debt, but has some medical and other expenses that I do not pay for. The lease is in my name and I pay the rent. We take turns paying for things like movie tickets, we chip in proportionally for any vacations that we take, and we go dutch when it comes to eating out. We go to the second-run theatre or get Redbox, and eat out using coupons or Groupon deals, so our spending in these categories is not too much (see budget). We share groceries – not in any particular way, but he buys some things and I buy other things as needed – it works out pretty evenly over the month.
The budget below only reflects my income and spending. Also, it is a bare bones budget. I realize that other than the $100/mo that I want to send to the EF, I am not saving much more for unexpected events etc. However, with over $44000 in consumer debt, I want to attack that aggressively rather than have a lot sitting around in savings. If something unexpected happens and I need more than I have in my EF, I will borrow the money from my Personal Line of Credit and then pay it down ASAP. Once I am down to about half this debt, I will up the amount I send into the EF.
My employer pays a 6% employee contribution towards my retirement plan. They don’t match – they just pay 6% in and no more. I have not planned to add anything to the retirement plan until I pay down my debt. My employer also pays contributions into a retirement reserve account, and I will receive a pension at retirement that is calculated based on salary at retirement. I have 2 more years to go towards vesting for the pension.
BUDGET
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Income: $3600
Rent: $749*
Internet: $15 (my share)
Car Insurance: $40
Utilities: $45 (usually ends up bring around $30-40)
Cell phone: $46
Gas: $80**
Groceries: $100 (my share)
Eating Out: $80 (my share)
Miscellaneous: $100***
Emergency Fund: $100
Debt Reduction: $2245 (see section on debt below)
* I live on the West Coast, and this amount of rent is pretty reasonably frugal for my area. I will be looking for something slightly cheaper to move into when my lease is up at the end of August, but I don’t know that I can lower this very much.
** This much works out for in town use. If I need more for out of town trips, I will budget for it or use Misc. money for smaller amounts that go over
*** Misc. covers most of my expenses that are not covered in the other categories. I rarely buy clothes that are not from thrift stores. I have no regular medical expenses.
DEBTS
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Discover: $3033.67 (25.99% APR, need to pay this off first)
USBank 2: $7086.72 ($700 at 23.99% APR, the rest at 0% APR till 8/13, 15.99% after that)
USBank 3: $9188.27 (0% APR till 10/13, 15.99% after that)
Chase: $4869.50 (0% APR till 3/14. Hopefully it will be paid off by then)
Citi Expedia: $3335.00 (0% APR till 8/13. Hopefully will be paid off by the end of the year)
Personal LOC: $10441.84 (9% APR)
Car Loan: $6197.09 (3% APR)
The minimum payments on all of these combined come up to $815/mo. I plan on putting $2245/mo towards them all.
I will try to see if I can open card and transfer some of these to 0% balance rates. However, given my debt:income ratio, it is unlikely that I will be approved for new cards. I tried recently and was declined. I will try again every few months or so while I work on reducing these debts.
First, some background about my living situation. My partner and I live together in a rented apartment. He is disabled, and does a part-time job. Each month he brings in ~$800, and I earn ~$3600. We keep our finances separate. He has no debt, but has some medical and other expenses that I do not pay for. The lease is in my name and I pay the rent. We take turns paying for things like movie tickets, we chip in proportionally for any vacations that we take, and we go dutch when it comes to eating out. We go to the second-run theatre or get Redbox, and eat out using coupons or Groupon deals, so our spending in these categories is not too much (see budget). We share groceries – not in any particular way, but he buys some things and I buy other things as needed – it works out pretty evenly over the month.
The budget below only reflects my income and spending. Also, it is a bare bones budget. I realize that other than the $100/mo that I want to send to the EF, I am not saving much more for unexpected events etc. However, with over $44000 in consumer debt, I want to attack that aggressively rather than have a lot sitting around in savings. If something unexpected happens and I need more than I have in my EF, I will borrow the money from my Personal Line of Credit and then pay it down ASAP. Once I am down to about half this debt, I will up the amount I send into the EF.
My employer pays a 6% employee contribution towards my retirement plan. They don’t match – they just pay 6% in and no more. I have not planned to add anything to the retirement plan until I pay down my debt. My employer also pays contributions into a retirement reserve account, and I will receive a pension at retirement that is calculated based on salary at retirement. I have 2 more years to go towards vesting for the pension.
BUDGET
------------------------------------------------------------------------
Income: $3600
Rent: $749*
Internet: $15 (my share)
Car Insurance: $40
Utilities: $45 (usually ends up bring around $30-40)
Cell phone: $46
Gas: $80**
Groceries: $100 (my share)
Eating Out: $80 (my share)
Miscellaneous: $100***
Emergency Fund: $100
Debt Reduction: $2245 (see section on debt below)
* I live on the West Coast, and this amount of rent is pretty reasonably frugal for my area. I will be looking for something slightly cheaper to move into when my lease is up at the end of August, but I don’t know that I can lower this very much.
** This much works out for in town use. If I need more for out of town trips, I will budget for it or use Misc. money for smaller amounts that go over
*** Misc. covers most of my expenses that are not covered in the other categories. I rarely buy clothes that are not from thrift stores. I have no regular medical expenses.
DEBTS
------------------------------------------------------------------------
Discover: $3033.67 (25.99% APR, need to pay this off first)
USBank 2: $7086.72 ($700 at 23.99% APR, the rest at 0% APR till 8/13, 15.99% after that)
USBank 3: $9188.27 (0% APR till 10/13, 15.99% after that)
Chase: $4869.50 (0% APR till 3/14. Hopefully it will be paid off by then)
Citi Expedia: $3335.00 (0% APR till 8/13. Hopefully will be paid off by the end of the year)
Personal LOC: $10441.84 (9% APR)
Car Loan: $6197.09 (3% APR)
The minimum payments on all of these combined come up to $815/mo. I plan on putting $2245/mo towards them all.
I will try to see if I can open card and transfer some of these to 0% balance rates. However, given my debt:income ratio, it is unlikely that I will be approved for new cards. I tried recently and was declined. I will try again every few months or so while I work on reducing these debts.
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