Poster in need of advice

[bjl584]

This is from an anonymous poster looking for help.
There isn't much to work with here, but here it is:



My wife and I just had a baby. She is no longer working to stay home and raise the child. I make decent money, but we both came into the marriage with debt and now I’m taking it on alone and it’s overwhelming. I have credit cards maxed out that I’m not able to pay on, thankfully we only have one car payment but it’s steep. I used a HELOC to help consolidate but even with that it’s hard to pay bills.

And advice for ways I could start to manage this better? Or financial assistance I’m not aware of?

[myrdale]

Get a second job.

Have the wife get a work from home job.

Trade the "steep" car payment in for something you can afford.

It's their choice for the wife to be a stay at home mom. Nothing wrong with it but that decision comes with a price, decreased income.

100% of the time, rolling credit cards into a HELOC is a bad decision. Before you did it the worst the credit cards could do was ruin your credit or maybe sue you. After you do it, now your home is in peril of foreclosure since you borrowed against it. And now the credit cards are balance free waiting for you to max them out again!

[Fishindude77]

Pretty similar advice here.
When you find yourself in a hole, the first thing you need to do is stop digging.
* Cut up and quit using the credit cards. Make all purchases cash or debit card using money you actually have.
* No more dumb ideas like HELOC'c to consolidate debt. You've only traded one kind of debt for another and you've put ownership of your home in a much riskier position.
* Get a cheaper vehicle.
* Find something your wife can do to bring in some income. Work overtime yourself or pick up a second job.
* No eating out, no vacations, no frivolous spending, no unnecessary costly fun, etc. until you get things turned around.

This is a great case for the Ramsey baby step plan. If you're not familiar with it, learn about it and start using their methods.