im 55000 dollars in the hole!is there any advice on how to get out i make 400 a week.i want to be dept free?thanks for responses,chuck

-- chuck (angeld@netpointe.com), April 14, 2000

Answers

Know the feeling! Go to www.cfcministry.org They are a Christian financial group, very smart. They can help you.

-- Vaughn (vdcjm5@juno.com), April 14, 2000.

That's a really neat site. We already have a five year plan (including the mortgage) to be debt free, but there are some really neat online tools here for those interested. It's worth the look and the reminder of what it means to not be debt free. The book that really helped us develop a plan was THe Complete Cheapskate by Mary Hunt. She really made things seem doable that before seemed insurmountable! Good luck.

-- Jennifer (jkmills@freewwweb.com), April 14, 2000.

There's a book, Living Well On Practically Nothing by Ed. Romeny. It's very plain but if you read carefully you will find some excellent ideas. We have two sons who live marginally as they are young and just starting out in life so I have been taking various topics and researching them on the net and writing notes for them to consider. The web is chuck full of ideas.....check out the following: www.stretcher.com or The Dollar Stretcher. It's excellent for there are explanations with regard to not only small items but the ones that hang a noose about our necks like interest on credit cards etc. There are many others. Look in your library too. Consider yourself on a quest towards liberty!!!!! It will be hard work but it's worth it to be in control of your finances. God Bless.

-- Norma Lucas (trooper806@webtv.net), April 15, 2000.

Quit buying stuff! Leave the consipicuous consumption society and start living simply. We (2) live very comfortably on less than $8000 a year. Have been fine tuning for over 16 years now. It's extremely satisfying and can be a lot of fun. We live off the wastes of society- -so much can be gotten for free, including this computor which was given to us. Internet access and e-mail is free. Clothing is THE biggest waste of money out there. Gratefully accept others disgards. Rescue items from the trash, mend and repair and soon you'll have tons of good stuff at almost no cost. Some advertisers make you feel you just can't live without their junk but you can. Stuff is just stuff. Make paying off your bills your main objective and do it with a vengance. Good luck. I'm here for support. Anyone can do it with "sticktoitism"!

-- Sandy Davis (smd2@netzero.net), April 15, 2000.

I've given your problem much thought and I keep coming up with the same three thoughts 1.Bankruptcy 2. Bank Robbery 3. Marry a Banker

-- Joel Rosen (Joel681@webtv.net), April 15, 2000.

$55K in the hole, Now a days that means you bought a new truck! Is the $400 before or after taxes? What other long term debt do you have, What utilitys/expenses do you have? All figure in to the issue. If you devote all $400 to the $55k Bill its payed off in just under 3 years. Any less and its longer.

Pay off high interest credit cards first then burn them is the first step. Figure out if you need what you have. Does the 2 new cars make sense? maybe 2 used cars would be better.

-- Gary (gws@redbird.net), April 15, 2000.

Chuck,

We know exactly what you are going through. When the new year came around we found ourselves 39,000 in debt and that didn't even include the mortgage. This is what we did to get ourselves back on track. 1. Figure out where you are now. Get all your debt statements together and get it all down on paper. you have to know where you stand before you can get anywhere. 2. make a plan. We got together with a credit counselor to help us deal with our creditors. most were helpful by dropping interest rates and lowering monthly payments. This helped to level this out. You can't get out of debt with out a plan. With ours we will have the non-mortgage debt payed off in 4 years and the mortgage 4 years after that. Gotta have a plan. 3. Once the plan is in place look for ways to cut costs. We were lucky in that with our food storage we didn't have to buy groceries for the first 3 months of the year. Search the internet there is a wealth of knowlege on how to be frugal. Read countryside and as many of the back issues you can get your hands on. This time of year you can put in a garden and grow all sorts of things. ours is 8500 Sqft and with six kids we use everything we can get out of there. the chickens are a big help with eggs and the pork and beef in the freezer help out also. There is a lot you can do just make a plan and get started. 4. Get rid of the credit cards NOW. This was difficult at first though as we look back I don't know why. We went to total cash for day to day expenses. Our counselor has the checkbook to pay the bills and creditors. this seems to work for us. 5. Finally don't ever give up!!! The last few months have been really tough on us and the kids. Ever try to send a boy to the school prom on a limited budget? It has been an adjustment but the family is starting to pull together and we are making progress. Good luck chuck and we wish you well. From someone who has been there.

sm4farm

-- sm4farm (dshans@hotmail.com), April 15, 2000.

Sell whatever nice vehicles you have and use the money to pay down bills. Buy a reasonable used car and insure that for less.

Cut up your credit cards. If you can't pay cash, or set aside cash to save up for it, you can't afford it. Accept that you can't have it.

Buy clothing from thrift shops and garage sales. Kids won't care, and you will get over it.

Buy whole foods, and bake and cook from recipes. Make twice as much as your family eats and freeze half. This helps get used to real cooking; left-overs are great. Never eat out. Pack snacks or a picnic basket for long days away from home. Never buy pre-prepared foods like soda pop or junk food.

Buy only gasoline from the gas station.

Go to the store fewer times a month. Make lists. Before you shop, take several items off the list that can wait, or you can do without if you must.

Make paying down your bills as much a priority as utilities. You actually do not NEED cable TV, long distance phone service (or actually even a phone), cell phones, rented movies (the library has movies you can check out for free), new CDs to listen to, computer games, a new microwave, etc.

Send everyone something, even $25/month. Chip away at your debt, and immediately stop accumulating more. Whatever products or services you received from your debtors, you owe them whatever you agreed to pay them. Time to face the music!

-- Rachel (rldk@hotmail.com), April 16, 2000.

Chuck: You have some really sound advice above. Our society today makes us feel that we HAVE to have all the glitz and glamor,and we don't. Living in Korea for two years opened my eyes to how wasteful we as Americans are (now, don't get huffy, everyone, I mean as a society.) There they wait for the Americans to put out their trash can on collection day, and by the time the truck came around, MAYBE there would be a handful of stuff left in the can. They recycle absolutely everything. Cereal boxes, tissue boxes, any cardboard or paper is all taken and carefully smoothed out and recycled. We collected our dog poops and bagged them and put them in the can, as we lived in a walled enclosure, with a concrete floor for the yard. Even those were taken, probably for fertilizer. When my husband retired, I almost hyperventilated everytime he bought anything, as I was sure we would starve to death. Now, we are both retired and 50ish, with a granddaughter to raise and are doing fine. Again, you can do without all the fancy stuff, and be happy and healthy. Our family has just as much fun popping popcorn and putting a jig saw puzzle together as we would going out to dinner and a movie. Good luck, stick to it and you will dig yourself out. Jan

-- Jan B (Janice12@aol.com), April 16, 2000.

Hi Chuck, Been there done that! Do not use credit cards. I know you need one as sometimes there are true emergencies, so put it under your socks and never take it anywhere with you. Next, if you don't have a coupon for other than bread and milk, don't buy it. The running joke here is my father in law goes to the bathroom and yells is there any toilet paper,and everyone yells back and says not if there wasn't a coupon. I am not quite that bad but there was a time... I do buy boxed meals and mixes if they are on sale and I have a coupon. If you see something you want to buy, look around elsewhere then decide to check the catalogs or something. By the time I've done that I find I managed without it. Also try to barter for some services. I also big town errands once a month. I make a list of what I need, go to that store, to that aisle or dept, get it and get out. I don't have to live quite that frugally any more. I do it from habit. I was once single with three little girls and up to my ears. Don't borrow money to consolidate if you can keep from it. Don't pay someone to tell you how to manage. But learn how to change the oil in the car, clip every coupon in sight and you'll find you spent so much time arranging them you missed the movie anyway whether you need the coupon or not(Ha Ha). It is so difficult to get straightened out especially if you have children who want what everyone else has. I took up knitting to keep from shopping and now can't stop. And something my sweet grandmother taught me many many many years ago, if you only save 5 dollars a week, it is more than you had. I know full well that sometimes that 5 dollars is hard to put back but you can. Before long it will be a passion to see how much you can put back. I will think of you as I know what a struggle it is to retrain yourself. And it sure won't happen over-night but take my word for it, there is no better feeling in the world. I am now married to a man (20 years)who makes sure I don't have to scrimp but I still do then he doesn't have to. And your children will rise up and call you cheap.. There are a lot of jokes in our family about my spending habits.

-- Susie (goodartfarm@msn.com), April 17, 2000.

I don't usually use coupons, as store-brand is usually cheaper than name brand even with the coupons. Also, the basic staples (flour, dry beans, 50 lb. bag of potatoes, etc., seldom have coupons available anyway. We are facing the same problem as far as debt, though the bulk of it is our mortgage -- but debt is debt. Those of you who read all of this forum have probably gathered from some of my postings that we are looking for a cheaper place to live. Hope to be able to sell out here, pay off all our debts, and have even a few thou. to start over somewhere. Want to be able to pay cash for the land and live cheap (even in a tent, if necessary), and build as we can afford to pay cash for it. It's getting harder to find places where you won't get into trouble doing that, but it sounds like there are still some out there. So that's our plan -- it has worked for other people, I know from magazine articles I've read over the years. Anyone on this forum do it that way? (Actually, we were well on the way to doing it ourselves while we were in Alaska -- and for those of you who want to know why we left -- family pressure from my in-laws. Big mistake.)

-- Kathleen Sanderson (stonycft@worldpath.net), April 17, 2000.

Kathleen As you already live in cold winters maybe you might be intersted in North Dakata? People are great here. There are housing rules but in the smaller rural areas we have found that they tend to look the other way on things that aren't to dangerous (but don't tell them I told you that!) We bought a structerally sound but otherwise beat up filthy place and our nieghbors didn't even tell us how insane they thought we were until our housewarming party 1 year later when a LOT of it was done!! What we did was to have me go to work to pay nesasarry bills while my husband was able to do all the work himself. Except theroof, which 8 of our brand new neighbors ( we had only been here 6 weeks!) showed up to help put on! Anyway, they want new people here, A plus if you're under 40ish, and if you have kids the town gets practically giddy! Especially if you arrive at the end of Feb., in a huge U-Haul, into a town of 200 and take a wrong turn (hence, touring the entire town). Truly, This has been a great plce to be! Anything else?

-- Novina West (lamb@stellarnet.com), April 18, 2000.

Novina, thanks -- North Dakota is one of the places I'm looking at (notice I said "I'm" -- my husband isn't real enthused yet!). I got a good chuckle from your account of your arrival in your new home town! We are 43 and 44, and our daughters are all grown, though the youngest is autistic and lives with us. Maybe in a few years our oldest daughter and her husband would follow us with their babies -- but he's from Southern Cal., had never seen snow until four years ago, and has a hard enough time with the winters here in NH, so maybe not!! I'm hoping to get a For Sale sign up out front by the end of May but don't know if we'll make it -- I've already had to push the deadline back once. Anyway, thanks -- and when the house is sold, I'll post a message on this forum asking for some serious advice on where to relocate (but I am already checking things out).

-- Kathleen Sanderson (stonycft@worldpath.net), April 18, 2000.

A word about credit counseling. Most banks and other financial institutions view these programs as "private bankruptcy." Talk with your personal banker before working with these organizations. Your credit can become damaged.

-- Bob Heiser (rgheiser@yahoo.com), April 20, 2000.

Another comment on credit counseling. We used a Consumer Credit Counseling Service and their Debt Management Program. Cost $35 to setup and $5 month. Turned in all the credit cards and such; they set up the payment sked with the creditors and established the repayment amounts. Usually no interest or a reduced amount. We've found no problems with the credit reports (FWIW, we just bought a house without any problems).

Also, check out Dave Ramsey's 'Financial Peace' book. A lot of good info there (you can absorb or ignore the religious references as you choose); Dave's situation made mine (and your's) look real simple.

Best of Luck (and welcome to the 'cash only' lifestyle)

j

-- j (jw_hsv@yahoo.com), April 20, 2000.

Chapter 13 might be a route to go... Stops the collections, stops the interest, and you pay everyone off - hopefully. I know someone who went for a Chapter 13 first, and then still ended up converting it into a Chapter 7.

Speak to the credit couselors, but speak to at two lawyers too - the 1st consultation is free, and they'll explain your options to you.

Good luck on your quest to be out of debt. Me, I have the mortgage and $275 on a credit card left. Everything else is ca$h only now! Scrounge and skimp! We dress ourselves and our kids at yard sales and thrift shops. Often we find NEW shoes for $1 or $2 a pair, pants, shirts, sweaters, etc. in the same range. And if you or your spouse can be an avid yard sale goer, you can usually find everything else you might need on the cheap too. Tools, furniture, carpet (we bought a NEW 10 X 12 area rug for $3 a couple of weeks ago), hardware, toys (my kids play with the used toys we bought more than the new ones they got from the relatives! I guess it's the "card board box" thing in a different fashion...), etc.

Good luck, and God bless!

-- Eric Stone (ems@nac.net), April 21, 2000.

We had 35000 in credit card debt on top of house payment, student loan, and regular bills when we got married. We got on a debt management program, free to set up, and an optional ten dollars a month to help with their administrative costs. A year and a half later, we're down to 24000, and should be out of these debts within two and a half years. It's nice to know there is light at the end of the tunnel. The program is called Money Management International. Their number is 1-800-762-2271. I checked out quite a few programs because they seemed to good to be true. I mean, why would anyone help for free, right? Theirs was the best. Good luck. Hang in there. It's not as hopeless as it seems. Carol

-- Carol (ffu001@mail.connect.more.net), May 06, 2000.

I know what you mean we are 55000 in debt we had just started this debt free progam .the company is call edge solutionsthey get with your bill collectors and reduce your entrest you send them so much a month and out of that they pay your bills you do non't have to think about it .we have a 36 month program good luck to you .

Lisa

-- Lisa Miller (ljmill35@aol.com), May 23, 2001.

Chuck - you've gotten a lot of really good info from this thread, but I would just like to interject a few things on living through this.

I've been helping my sis out of debt, 45,000. For a gainfully employed person, like herself it was mindboggeling how she got in this position and how to get out. First I told her it would be a slow process that she had to stick with. No feeling sorry for herself and buying something she didn't need just to passafy herself.

She never bought food with coupons, but she does now. She always had to have the fancy chic foods, but has now found every day foods just as appealing. Her favorite past time is theater and opera. She told me she couldn't give up her season tickets (almost 1,000 combined), I told her she couldn't afford not to.

We started taking her with us to FREE! concerts in the park, the FREE! Shakspear festival, the FREE! Art Walk, Street Fairs and the FREE! lectures that our local Junior College puts together. There is a wealth of culture out there that will help lift the spirites during this difficult time. She was amazed how fun a picnic and a concert could be. She was used to expensive resturants and dressing up.

I guess my point is to find fun free things to do to keep you from getting overwhelmed or depressed. It really helps and my sis has realized how much more there is to life than just pulling out a credit card.

For the nitty gritty, we paid off cards with the lowest balance first then cancealed them. That made her credit look a little better. Then she was able to transfer one balance to a card that had a low interest rate (2.9%). As she works down the cards she will again canceal them so she can transfer other card balances to low rate cards. Hopefully she will be out of debt in about a year.

Best of Luck, I know first hand how hard this can be.

-- jennifer (schwabauer@aol.com), May 23, 2001.

I don't want to sound holier-than-thou, but how do you get $55,000 in debt? I assume you're not counting a mortgage. I have no debt except my mortgage, and I just don't understand how folks get there. Especially when you only make $400 a week -- who would lend you that much? When I had a thriving business and NO debt at all, it would have been difficult to get a bank to loan me money without a cosigner. And how come people buy things they hain't got the money for in the first place? (Medical emergencies are in a category by themselves, of course.) I mean, weren't your eyes open when you rang up your purchases or signed on the dotted line? Was there a gun at your head or something?

-- snoozy (bunny@northsound.net), May 24, 2001.