Can I be saved, or am I in deep s**t?

[Anonymous]

I do have dental insurance and they've paid for half of everything every time I go. Sometimes I go over my limit so they don't pay it.

Oh and another thing, I tried to get my sister out of her mess (as I did) by transferring everything she owed to my cards. Another stupid decision, but I'm supposed to be the responsible one. I really, really screwed up on that one. Now she's got herself into the mess again... It's just not as bad (or anywhere close) to mine.

*sigh* the more I talk about this, the more I just want to sit in a corner and cry. :-/ 

[DI]

---

@Anonymous wrote:

I do have dental insurance and they've paid for half of everything every time I go. Sometimes I go over my limit so they don't pay it.

Oh and another thing, I tried to get my sister out of her mess (as I did) by transferring everything she owed to my cards. Another stupid decision, but I'm supposed to be the responsible one. I really, really screwed up on that one. Now she's got herself into the mess again... It's just not as bad (or anywhere close) to mine.

*sigh* the more I talk about this, the more I just want to sit in a corner and cry. :-/ 

---

Right now just be thankful that you have a job that pays you $35k and you are still young.   Many people have been in your shoes before.  Some find a way out without filing BK and some don't.  

Keep taking care of your health, excercise to relieve stress, eat healthy, and take one day at a time.  

Try to see if you can work something out with the creditors before filing BK if you decide to do it.

[Anonymous]

What I don't understand is I'm 25 years old and the largest credit card limit I have is $2600.  I get paid bi-weekly pretty much my credit limit on the card and they won't raise it.  How are people younger than me getting 20k+ cards to begin with? 

Should I be arguing for a higher limit to help with any utilization I have?

EQ: 700 (8/9/2009)
TU: 715 (8/3/2009)

Message Edited by Cyan007 on 08-10-2009 10:53 PM

Message Edited by Cyan007 on 08-10-2009 10:53 PM

[Macroman]

To the OP: Been there, done that.

You can dig out but you have to decide first that there are things you can live without. Trips sound like #1. Only take trips to the extent that you can pay cash for everything.

Follow the other poster's advice and pack lunch from home. Limiit yourself to only a very limited schedule of eating out, maybe once a week. If your friends are in the same boat then they should be following the same advice. It's a lot cheaper to have a pot luck party at someone's house than eating out and being in the bars. It may just take someone suggesting it first.

Above all pay attention to what's going on with your CCs. If somebody changes the terms on a card with a balance you want to refuse the change and have them close it out. They are maxed out anyway so you loose nothing.

Pay the CC bills first thing when the new statements post. This will reduce your average daily balance and reduce the temptation to spend on something else. Another job will help if you can manage it but make sure it does not interfere with your main job.

If you're dedicated to getting out by paying the debt off you can do it. If you go BK none of your current CLs will ever forget that and it will be on the CR for 10yrs. BK and your creditr will be total %$F# for a long time.

Being young as you are you should get some decent raises at work if you're doing a good job. This will make it easier to dig out as long as you stay focused on paying off the debt. The reverse can be true if you take it as a signal to go back to spending like you have.

If you have the discipline to do it properly you don't have totally shelve the other cards but you have to work from a budget. You have to have a plan that says that you will pay off net X dollars per month and stick to it. Put together a paydown spreadsheet with targets along the way and make sure you stay on track. If you fall behind then you need to tighten spending controls further. Reward yourself with something affordable but memorable for hitting targets quarterly, annually, whatever feels right. Tell your friends in the same situation what you are trying to do, maybe you get a club together.

Finally set a debt-free date based on your spreadsheet and make sure you stay on track. 

If you continue to max out cards: 1. soon you won't be able to get more 2. all the cards will boost your rate and possibly min payment 3. You'll get deeper and deeper

If you find yourself on this second path you'll have to go BK.

Good luck.

[Lel]

---

Cyan007 wrote:

What I don't understand is I'm 25 years old and the largest credit card limit I have is $2600.  I get paid bi-weekly pretty much my credit limit on the card and they won't raise it.  How are people younger than me getting 20k+ cards to begin with? 

Should I be arguing for a higher limit to help with any utilization I have?

---

Cyan007, may I suggest that you post your question on a separate thread?  This thread was started by someone who requested help on how to dig himself/herself out of serious credit card debt.  Your message is not a useful contribution to this discussion.

Message Edited by Lel on 08-10-2009 09:30 PM

[Anonymous]

You can do this.  It won't be easy, but you can get out of this debt.  It will require a couple years of harsh adjustments and a complete lifestyle change, but when it's all said and done you will be glad you did it.

First things first - DO NOT go back to school.  You really can't afford it, and unless you plan on increasing your salary by 10-15k because of it don't do it.  You can always do it in a few years if you really want to, but not now.

Second - find a second job or another source of income.  I'm not sure if you 9-5 it, but you probably could find some place to work nights and/or Sat/Sun.  Consider house sitting/babysitting/yard work/painting, really anything, to get some extra cash.  It will suck for a while, but in a couple years you should be free and it will be more than worth it.

You are still young and can work through this with a couple of years of tough living.  You are also blessed with a steady job that you should milk for all its worth.

You are doing the right thing by posting on this forum and seeking advice.  I would also recommend checking out these sites for some inspiration and good advice - Bloggin Away Debt and DINKS finance.  I've been following both these sties for some time now, and I pick up some good tips from them.

Good luck, and please don't hesitate to post on here more often.  I'll be checking bag regularly.  You might even want to start some sort of blog (as long as it doesn't take much time up) where you can be kept accountable by readers.

-DC

[Anonymous]

---

@Anonymous wrote:

I do have a lot of clothes, and have tried selling them to Plato's closet and what not. I don't buy those expensive name brand stuff or anything. I just get whatever I like and if they happen to be expensive, it doesn't mean I can resell for the same or even half the price. Clothes get cheaper by the season now.

I just don't think selling my things will help that much. 

What do you think about me going back to school? Is that a bad idea at the moment? 

---

Without reviewing all of the posts in this thread, I am following up on the initial posts/replies that you and I had in the beginning.

I do believe that going back to school right now is a bad idea, if considering your debt.  If you were to work full time and get addition second/third jobs, eliminate all non-essential expenses and really button down, you could pay your debts of in a few years.

As the saying goes, eventually you have to pay the piper.  And since you spent the credit drinking, going out and traveling, you don't have any accumulated assets to offset the debt in any meaningful way.

While you can go BK, you need to really analyze the situation and create a budget.  Look into what you can pay now and what you could pay with another job.

There are no easy answers at this point, but obviously something has to change.  You can continue to make minimums, but you will never get out of debt at the levels you are in.  Minimum payments are not calculated as a pay off payment.  They are really just for occassional use for cash crunch months.  Otherwise it takes decades to pay off with minimums.

You played hard, now it will require working hard.  But if you do, you will save yourself 10 years or more of financial mess, whereas if you go after this with a vengeance you can be out of it in 3 to 4 years with sterling credit and a great life lesson.

I wish you luck.  I hope you manage to make it happen!

[Anonymous]

Honestly, reading aspects of your posts are like looking in a mirror.  I too am knee deep in CC debt, and I'm working very diligently to get out of it.

1.  Cut out haircuts.  Get an inexpensive deep conditioner and use that.  Or use a regular conditioner and wrap your hair in saran wrap and let it sit for a good 45 minutes.  Cutting out cut & color on your hair can save you a fortune. 

2.  If you have a gym membership, cancel that too.  Even if your gym is $30 a month, that money can really start to add up.

3.  Do you have an accountant who does your taxes at the end of the year?  I'm surprised that classes for school couldn't have been written off in some way as a business expense.  But seriously, talk to an accountant about some things you can do.  And if you don't have an accountant, find one...let them review your last return or 2...maybe they can be amended to get you a bigger refund.  What about donating your clothes and writing that off as a charitable donation if you can't sell them? Try eBay or Craigs List for selling your clothes and stuff, not just local consignment shops.

4.  Can you move back home?  Getting rid of the lease on your apartment will give you a good amount of extra money to go towards your bills. 

I'm sure there are lots of little things like manicures/pedicures, facials, the new lipstick that you have every month that don't feel like they are "anything", but could easily be cut out and free up some money to pay off these cards.  I look at my itemized statements every single month to try and find a way to cut things out.  No more Starbucks...I drink the coffee from the free machine at work.  No more weekly manicures...I use a good hand cream instead.  No more daily trips to Whole Foods for a $10 salad...I make lunch at home.  You get the idea...and by paying even a few dollars more every month over the minimums due on my accounts is starting to really add up in a good way.

But, like all of these other posters have said...you're very young.  You have an opportunity to be selfish (in a good way) to get yourself out of this problem by possibly taking a 2nd job, moving back home, etc.

Good luck! 

[Anonymous]

I AM lucky to have this job. I know you guys don't want me to go back to school, but I'm more than certain that if I do and get this degree, my salary WILL increase significantly. But there is a chance it might not happen. There's always doubt regardless of the scenario. My boss did say that as long as I plan on staying with the company, my job is secured. So that's good.

As far as going at this with a vengeance, that's what I really want to do. I actually went to bartending school last summer and did nothing with it. Maybe I should become a bartender somewhere in town overnight and weekends instead of going to school?? I don't know... it's so hard to decide what is right. I guess if I look at the big picture, not running away from my problem IS the right thing to do. Going back to school for a 2nd degree should be the last thing on my mind right now. But to each his own.

--------------------------------

Back on the BK subject, my roommate went through it a couple years ago. He said it was the most embarrassing thing he had to go through, but when it was all over, he felt ... relieved. I only saw it as a shortcut, even though I was glad he did it... So maybe it's not so bad after all? I mean I don't want to say that, but if I just BK everything, I wouldn't have to not go back to school, right? Then again, I wouldn't have learned a lesson the hard way. 

You know... maybe I will get that second job. I think I can conquer this on my own. I don't want to grow old and tell my kids there are shortcuts to everything in life.

[Anonymous]

---

@Anonymous wrote:

Honestly, reading aspects of your posts are like looking in a mirror.  I too am knee deep in CC debt, and I'm working very diligently to get out of it.

1.  Cut out haircuts.  Get an inexpensive deep conditioner and use that.  Or use a regular conditioner and wrap your hair in saran wrap and let it sit for a good 45 minutes.  Cutting out cut & color on your hair can save you a fortune. 

2.  If you have a gym membership, cancel that too.  Even if your gym is $30 a month, that money can really start to add up.

3.  Do you have an accountant who does your taxes at the end of the year?  I'm surprised that classes for school couldn't have been written off in some way as a business expense.  But seriously, talk to an accountant about some things you can do.  And if you don't have an accountant, find one...let them review your last return or 2...maybe they can be amended to get you a bigger refund.  What about donating your clothes and writing that off as a charitable donation if you can't sell them? Try eBay or Craigs List for selling your clothes and stuff, not just local consignment shops.

4.  Can you move back home?  Getting rid of the lease on your apartment will give you a good amount of extra money to go towards your bills. 

I'm sure there are lots of little things like manicures/pedicures, facials, the new lipstick that you have every month that don't feel like they are "anything", but could easily be cut out and free up some money to pay off these cards.  I look at my itemized statements every single month to try and find a way to cut things out.  No more Starbucks...I drink the coffee from the free machine at work.  No more weekly manicures...I use a good hand cream instead.  No more daily trips to Whole Foods for a $10 salad...I make lunch at home.  You get the idea...and by paying even a few dollars more every month over the minimums due on my accounts is starting to really add up in a good way.

But, like all of these other posters have said...you're very young.  You have an opportunity to be selfish (in a good way) to get yourself out of this problem by possibly taking a 2nd job, moving back home, etc.

Good luck! 

---

*My haircut is $40 a month I would say. In case you guys are wondering, I'm a guy. LOL. So I don't do manicures/pedicures and the whole shebang! hah! As far as gym membership, I canceled that last year and decided to make my own "gym" at home. I cannot move back home because home is 2500 miles away. I don't have an accountant because I do my own taxes. Maybe I should get one (will get back with you on that).

*The only thing I can think of getting rid of are:

-Cable/Internet - $130 (but I have a roommate, so how does that work?)

-Dining Out - $120 average monthly

-Haircut - $40 monthly (becuase of tips)

-Change cell phone plan to "pay as you go"

-No more concert trips!! (big music fan here)

-Possible getting rid of my car??? $425 monthly

As far as my mandatory traveling, I like to visit home at least once a year and that can be costly. If I don't visit, I'm sure my family would understand, but still, they're family. Not seeing them for years and years would be a very bad thing in the long run.