Avoiding Bankruptcy

[Anonymous]

First, I'm not sure this is the right place so please relocate if necessary.  I have gone back and forth about whether to put this thread here or the bankruptcy board. I think this might classify more as debt management. 

I have a problem, a gambling problem, and cash advances just make it too easy. I still have good credit (last report pulled was Tu 753) despite myself and my lack of self control. This is my second issue with credit, and hopefully my last. My first was 18 years old no job + credit card = can't pay. Big surprise there. I settled with the company and rebuilt my credit years later. I bought a house 2 years ago. 225k loan of 200k at 4% Unfortunately something I never considered when buying that house was how close it was to a casino. I was an occasional recreational trip to atlantic city gambler. Over the last year thats changed to I put my entire savings, and about 40K of cash advances into gambling at the casino.

I'm starting this post to keep myself honest, and accountable. My hope is to skirt by, and avoid bankruptcy, while also fighting my gambling addiction.

I also was laid off of my job for the past two years, I have started new employment, and picked up a part time job to also help out. My previous income was about 70K/yr with a lot of overtime(but it was regularly available.) Expected income from the new job situation is about 76k/yr. I also can expect 11K from my longterm girlfriend who lives with me as her contribution to bills/rent. Twice a year I get a check from family for about 2K which totals to about 91K/year. My income will be inconsistent for the next month until my new jobs and regular hours settle in.

Before I speak of my regular monthly expenses (which will need to be trimmed down,) I would like to give you an idea of the debt I am in.

Personal loan 19,006.13 @8% 626.74/mo

Wells fargo cc 3500 @ 23.99% estimated $105 min pay

Chase freedom 2575 @ 19.24% estimated $40 min pay

Disc 4377.75 @ 0% until 8/15 $90 min pay

Barclay card 3811 @ 0% until 10/15 $40.11 min pay

Chase slate 3750 @  % until 12/15 estimated $37.5 min pay

Citi simplicity 4319.75 @ 0% until 2/16 65 min pay

total = 41339.63

I will update interest rates on the 0% cards as they get closer to the time. I also have all my credit cards and limits listed in my signature.

My plan for getting out of the debt at this point is to pay the personal loan at 626.74/month and pay the minimums to all the credit cards, except one which is where the rest of the money will go to. The order I plan to attack the credit cards is in the order as listed for right now. IF I get out of the 0% promotions the order will be based on the interest rate as opposed to when the promotion ends.   I am open to suggestions on different strategies. I also plan on dumping any windfall (xmas, birthday, tax return) into the debt, in the same manner as the regular payments.

As I said my income will be inconsistent over the next month. So it will be hard to do much of anything to help put a dent in the debt as I will only be able to be reactive not proactive.

4250/month is a fair approximation of my monthly income after taxes.

1650 Mortgage/insurance/taxes

330 Utilities (non negotiable)

160 2 cell phones (contract expires in november shopping around)

160 DTV (will get cut down to about 100)

60 Internet (cheapest around)

150 car insurance

225 car payment @3% pay off date 10/16 (The car is my girlfriends however I am her cosigner and well I pay for it)

Food/household items and fuel average 350/month with the largest being fuel my car is 29/mpg but work is not close to home and no other commuting option available (will work on lowering this if at all possible)

1165 /month left over for debt.

1004.35/month in minimum credit card payments. Give or take depending on the min payment estimates. So not much left over for extra payment.

Few bright spots ahead are that twice a year check from my family comes in the first week of November so that will be a big help in trying to get that first credit card paid off. I have considered paying off the Chase freedom first instead of wells fargo because I can have the freedom PIF by Christmas I think thanks to the bonus check.

This will leave a ~3400 balance on WF and I will be able to up my payments to about 300/mo. I'm not sure exactly what my tax return will be this year, last year it was about $3500, I filed in Feb. and got my direct deposit in Feb. If we can repeat this success (and I mean efficiency not cheating) that would pay off the WF card, and still leave me $650 to be applied to my next card the Discover card.

3277.75 would be the balance after tax return. This brings my payments to discover to 390/month in May I would have a balance of 2107.75 May is when I get that other bonus check from family leaving me a balance of only 107.75 to be PIF in June 2015

Next card barclay card will have a balance of 3450.01 but after paying off the last card and upping my payments to CC to 430.11/month my balance will be 3127.65 4 months later in Oct. My balance will be 1407.21 and unfortunately I will be out of my 0% promotion.

Good thing next month is Nov, and I get that bonus check again. Barclay will be paid off, and I will still have 1022.9 to apply to my Slate card with a balance of 3225 bringing the new balance to 2202.1.  My new monthly payment would be 467.61/month. Dec balance1734.49 interest kicks in on this card. Feb balance around ~900 if we can repeat IRS success (and I still mean efficiency not cheating) The slate card is paid off with $2600 to apply to other debt.

The balance on my last card would be 3214.75 once the rest of the tax return is applied 614.75 Feb. is also the month interest starts again. However my new payment is 532.61/month which makes the CREDIT CARD payoff date april/2016

Loan balance at this point would be 7098.07 add in the balance of aprils Credit card payment  new total 6647.60. my new monthly payment would be 1159.35(not sure how this didn't add up to 1165 it should have) May is a bonus month new balance after payments 3488.25 after my August 2016 payments it will leave me an $11 balance on my payments (if I figure out my mistake $1159 vs $1165) I will have a $0 balance, and hey even if I don't I will find the $11 to be done.

23 Months to salvage my life. 23 months of sacrifice.

Goals;

1 follow plan as written

2 Update often

3 listen to advice

4 stay focused

5 don't stress over it just follow the plan.

6 don't stress out friends and family

7 Recalculate numbers at least once a month life is unpredictable things will change.

8 Above all else, stay out of the casino's and away from gambling.

Thanks for reading, look forward to your advice.

Philannony

[daybreakgonesXe]

---

@Anonymous wrote:

First, I'm not sure this is the right place so please relocate if necessary.  I have gone back and forth about whether to put this thread here or the bankruptcy board. I think this might classify more as debt management. 

I have a problem, a gambling problem, and cash advances just make it too easy. I still have good credit (last report pulled was Tu 753) despite myself and my lack of self control. This is my second issue with credit, and hopefully my last. My first was 18 years old no job + credit card = can't pay. Big surprise there. I settled with the company and rebuilt my credit years later. I bought a house 2 years ago. 225k loan of 200k at 4% Unfortunately something I never considered when buying that house was how close it was to a casino. I was an occasional recreational trip to atlantic city gambler. Over the last year thats changed to I put my entire savings, and about 40K of cash advances into gambling at the casino.

I'm starting this post to keep myself honest, and accountable. My hope is to skirt by, and avoid bankruptcy, while also fighting my gambling addiction.

I also was laid off of my job for the past two years, I have started new employment, and picked up a part time job to also help out. My previous income was about 70K/yr with a lot of overtime(but it was regularly available.) Expected income from the new job situation is about 76k/yr. I also can expect 11K from my longterm girlfriend who lives with me as her contribution to bills/rent. Twice a year I get a check from family for about 2K which totals to about 91K/year. My income will be inconsistent for the next month until my new jobs and regular hours settle in.

Before I speak of my regular monthly expenses (which will need to be trimmed down,) I would like to give you an idea of the debt I am in.

@Anonymous loan 19,006.13 @8% 626.74/mo

@Wells fargo cc 3500 @ 23.99% estimated $105 min pay

@Anonymous freedom 2575 @ 19.24% estimated $40 min pay

@Disc 4377.75 @ 0% until 8/15 $90 min pay

@Anonymous card 3811 @ 0% until 10/15 $40.11 min pay

Chase slate 3750 @  % until 12/15 estimated $37.5 min pay

@Anonymous simplicity 4319.75 @ 0% until 2/16 65 min pay

total = 41339.63

I will update interest rates on the 0% cards as they get closer to the time. I also have all my credit cards and limits listed in my signature.

My plan for getting out of the debt at this point is to pay the personal loan at 626.74/month and pay the minimums to all the credit cards, except one which is where the rest of the money will go to. The order I plan to attack the credit cards is in the order as listed for right now. IF I get out of the 0% promotions the order will be based on the interest rate as opposed to when the promotion ends.   I am open to suggestions on different strategies. I also plan on dumping any windfall (xmas, birthday, tax return) into the debt, in the same manner as the regular payments.

As I said my income will be inconsistent over the next month. So it will be hard to do much of anything to help put a dent in the debt as I will only be able to be reactive not proactive.

4250/month is a fair approximation of my monthly income after taxes.

1650 Mortgage/insurance/taxes

330 Utilities (non negotiable)

160 2 cell phones (contract expires in november shopping around)

160 DTV (will get cut down to about 100)

60 Internet (cheapest around)

150 car insurance

@Anonymous car payment @3% pay off date 10/16 (The car is my girlfriends however I am her cosigner and well I pay for it)

Food/household items and fuel average 350/month with the largest being fuel my car is 29/mpg but work is not close to home and no other commuting option available (will work on lowering this if at all possible)

1165 /month left over for debt.

1004.35/month in minimum credit card payments. Give or take depending on the min payment estimates. So not much left over for extra payment.

Few bright spots ahead are that twice a year check from my family comes in the first week of November so that will be a big help in trying to get that first credit card paid off. I have considered paying off the Chase freedom first instead of wells fargo because I can have the freedom PIF by Christmas I think thanks to the bonus check.

This will leave a ~3400 balance on WF and I will be able to up my payments to about 300/mo. I'm not sure exactly what my tax return will be this year, last year it was about $3500, I filed in Feb. and got my direct deposit in Feb. If we can repeat this success (and I mean efficiency not cheating) that would pay off the WF card, and still leave me $650 to be applied to my next card the Discover card.

3277.75 would be the balance after tax return. This brings my payments to discover to 390/month in May I would have a balance of 2107.75 May is when I get that other bonus check from family leaving me a balance of only 107.75 to be PIF in June 2015

Next card barclay card will have a balance of 3450.01 but after paying off the last card and upping my payments to CC to 430.11/month my balance will be 3127.65 4 months later in Oct. My balance will be 1407.21 and unfortunately I will be out of my 0% promotion.

Good thing next month is Nov, and I get that bonus check again. Barclay will be paid off, and I will still have 1022.9 to apply to my Slate card with a balance of 3225 bringing the new balance to 2202.1.  My new monthly payment would be 467.61/month. Dec balance1734.49 interest kicks in on this card. Feb balance around ~900 if we can repeat IRS success (and I still mean efficiency not cheating) The slate card is paid off with $2600 to apply to other debt.

The balance on my last card would be 3214.75 once the rest of the tax return is applied 614.75 Feb. is also the month interest starts again. However my new payment is 532.61/month which makes the CREDIT CARD payoff date april/2016

Loan balance at this point would be 7098.07 add in the balance of aprils Credit card payment  new total 6647.60. my new monthly payment would be 1159.35(not sure how this didn't add up to 1165 it should have) May is a bonus month new balance after payments 3488.25 after my August 2016 payments it will leave me an $11 balance on my payments (if I figure out my mistake $1159 vs $1165) I will have a $0 balance, and hey even if I don't I will find the $11 to be done.

23 Months to salvage my life. 23 months of sacrifice.

Goals;

1 follow plan as written

2 Update often

3 listen to advice

4 stay focused

5 don't stress over it just follow the plan.

6 don't stress out friends and family

7 Recalculate numbers at least once a month life is unpredictable things will change.

8 Above all else, stay out of the casino's and away from gambling.

Thanks for reading, look forward to your advice.

Phil Annony

---

Hey Phil! Welcome to the forums and nice to see another person from NJ!

You seem to have a good head on your shoulders and understand what needs to be done. You made a very well thought out plan, calculated your monthly obligations, and figured out how long it would take to pay based on your sources of income. Mistakes happen and addiction is no walk in the park, so stuff happens. You want to work hard to not only get out of the debt you are in, but also defeat the addition to prevent it from decimating your savings in the future.\

First step is to get help. Getting out of debt is one thing, but what help will it do if you keep racking up casino charges? My mom is a shopaholic. She buys stuff, gets upset that her multiple CC and loan payments are so high, gets depressed, then shops MORE to feel better, and the cycle just continues. As much as she wants to get out of debt, she is not fixing the source of the problem and balances just climb even though she wants to pay down her cards and improve her credit.

Second step is to stop using your credit cards if at all possible. Pay for your daily, necessary expenses with cash, check, or debit card. Cut up your credit cards to resist temptation to use them to take out money. This will enable you to really see the ins and outs of your bank account, and determine what really should be deemed a necessity.

I am by no means a financial advisor, although I tend to do a pretty good job when finances and credit are simple. You do have a lot of financial obligations and not a clear-cut financial picture because you cohabit with your girlfriend, so I woudn't be the person to critique and give expert advice to your current set up since there's too many variables. Maybe someone with more experience on the matter would be best for going line by line and figuring out what works and doesn't. So far, though, your plan looks great!

Have you talked with your girlfriend about the plan? Maybe she can give some more financial support when it comes to the things you share. You can also agree on making lifestyle changes, such as cooking more at home, taking less or closer vacations or night's out, etc. I understand if you can't do all such things, but at least being on the same page of what is going on with your financial picture is important in case something happens down the road where you two can't live the life you used to.

You did mention you won't have a steady source of income right away, and that's okay. Make sure you make at least the minimum payments on all your credit cards, loans, and other bills that could report late payments quickly (such as cell/utility services if they are not paid within 30 days from the due date). Then, once a more steady source of income comes in and you have a better sense of the ins/outs, that will be the the best time to throw any extra money towards your debt. Once you have this kind of income, then you can tackle your debt via the high to low method (paying down the bills at the highest interest rate to the lowest until the debt is gone, saving you the most money in the long run), or the snowball method (paying the smallest balances first to gain a sense of "accomplishment" and keep you motivated to pay everything else off).

Other than that, I wish you the best of luck and to a speedy recovery in every sense of your life! Cheers!

[Anonymous]

Thanks for the reply, I should have mentioned it earlier, my girlfriend is aware of the plan and is on board. However her limited income as well as her own outstanding debt, no where near as bad as mine or for such a silly reason, prevents her from being able to contribute more at this time. She has a job interview in about a week or so that would increase her income by as much as 50% her expenses for traveling would take back a good portion of this, but if she keeps her current job fulltime we could land in a great place but for the time being I will keep her as only contributing the $900 a month. 

Another thing I havent mentioned or discussed is I do have a 1000sq ft loft that is rentable if I install a kitchen or kitchenette for about 500/600/month.I also have another 3 room section also that could be rented for another 400/500/month about 700 sq ft. However I am not sold on the idea of renting, although I know what the extra $1000/month would do. I will update with more details about this and the girlfriend situation in the near future. 

Phil annony

[Anonymous]

P.S. Thanks for moving the post. Like I said I was torn.

[CribDuchess]

I applaud you for standing in your truth (as Suze Orman would say)!  You can do this.  Acknowledgement is the first step in resolving any problem.

Regarding your tax refund - you should look into adjusting your W-4 at your main job.  Having a refund of about $3,500 means you could have almost an additional $300 of take home pay each month.  The IRS won't pay you any interest on that $3,500 refund, meanwhile you're paying interest to your credit card companies.  You need to live in the "now", not the "later."

The IRS has a very nifty withholding calculator that you can use to figure out if you're having too much or too little in income tax withheld, and then you can adjust your W-4 withholding with your employer(s).

www.irs.gov/Individuals/IRS-Withholding-Calculator

I wish you the best of luck and will look forward to reading your progress reports.

[NYFan63]

Phil - I just wrote a lengthy response and it did not update - basically the gist of my message was I was in your shoes before - stick to your plan, stay away from AC and you will be happier in the long run.  Paying down your CC bills each month will keep you confident and will keep your credit intact.  Renting will help you achieve your goals faster so maybe just event for one year to achieve your goals.  Renting has its own issues too so makw sure your read the very strick renting laws in NJ.  

Best of luck! 

[Anonymous]

---

@CribDuchess wrote:

I applaud you for standing in your truth (as Suze Orman would say)!  You can do this.  Acknowledgement is the first step in resolving any problem.

Regarding your tax refund - you should look into adjusting your W-4 at your main job.  Having a refund of about $3,500 means you could have almost an additional $300 of take home pay each month.  The IRS won't pay you any interest on that $3,500 refund, meanwhile you're paying interest to your credit card companies.  You need to live in the "now", not the "later."

The IRS has a very nifty withholding calculator that you can use to figure out if you're having too much or too little in income tax withheld, and then you can adjust your W-4 withholding with your employer(s).

www.irs.gov/Individuals/IRS-Withholding-Calculator

I wish you the best of luck and will look forward to reading your progress reports.

---

My tax refund is mostly because of my mortgage, and job expensses. I would estimate my tax refund before adding in my mortgage and expenses to be less than $400. Thanks for the tip though I will double check it, I just filled out new w4's at both my new jobs, so we will see how things go. lots of room for error in my plan, a lof of it is estimates based on passed experience, and I know thats a slippery slope. 

[Anonymous]

---

@NYFan63 wrote:

Phil - I just wrote a lengthy response and it did not update - basically the gist of my message was I was in your shoes before - stick to your plan, stay away from AC and you will be happier in the long run.  Paying down your CC bills each month will keep you confident and will keep your credit intact.  Renting will help you achieve your goals faster so maybe just event for one year to achieve your goals.  Renting has its own issues too so makw sure your read the very strick renting laws in NJ.  

Best of luck! 

---

Thanks for the good wishes. I do not go to Atlantic city anymore, where I bought my house in Pennsylvania is right near a casino, I haven't been to AC in a very long time. I have added myself to the self exclusion list at my local casino, and reached out to a therapist. I don't want to dig my way out to bury myself all over again. 

Renting is very scary to me, but so is this debt. 

[Anonymous]

Oh, and some other relevant information as it just came to mind, I'm sure it would come up at some point.

I am 29 years old. My girlfriend and I have been together 6 years, living together 4. 

All my Credit cards, loans and utilities are still on time, I've never made a late payment since my first credit card over 10 years ago. 

[CribDuchess]

---

@Anonymous wrote:

---

@CribDuchess wrote:

I applaud you for standing in your truth (as Suze Orman would say)!  You can do this.  Acknowledgement is the first step in resolving any problem.

Regarding your tax refund - you should look into adjusting your W-4 at your main job.  Having a refund of about $3,500 means you could have almost an additional $300 of take home pay each month.  The IRS won't pay you any interest on that $3,500 refund, meanwhile you're paying interest to your credit card companies.  You need to live in the "now", not the "later."

The IRS has a very nifty withholding calculator that you can use to figure out if you're having too much or too little in income tax withheld, and then you can adjust your W-4 withholding with your employer(s).

www.irs.gov/Individuals/IRS-Withholding-Calculator

I wish you the best of luck and will look forward to reading your progress reports.

---

My tax refund is mostly because of my mortgage, and job expensses. I would estimate my tax refund before adding in my mortgage and expenses to be less than $400. Thanks for the tip though I will double check it, I just filled out new w4's at both my new jobs, so we will see how things go. lots of room for error in my plan, a lof of it is estimates based on passed experience, and I know thats a slippery slope. 

---

Yes, with you being single and no dependents, I realized your refund was mostly due to being able to itemize your mortgage interest and other expenses.  As long as you're still going to itemize and deduct your mortgage interest and other expenses, then you should be able to adjust your W-4 withholding to get more money in your paychecks and less of a refund next year (or future years).  I would rather pay the IRS a couple of hundred bucks on April 15th, then have them hold onto any of my money.

Since you just started two new jobs, maybe you could just ride it out for the remainder of this tax year.  Then re-evaluate your W-4 withholding after you have filed your 2014 taxes and determined your refund amount.