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Shifting Debt no longer working

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Valued Contributor

Shifting Debt no longer working

For the last 2 years I have shifted debt between personal loans, 401 K loans, CC balance transfers etc... but I have continued to charge up CC after. I need a game plan to tackle this. Currently 23000 loan on my 401, a personal loan for a balance of 17000 and now another 8000 in CC debt. Guys I have to stop. I have no hobbies , dont get manipedis, but 4000 of my new debt is pet related. Advice or tips? I work FT about 60 hours a week as a salary RN Director, make only about 300 bucks more than I did last year. I can shift all I want right now with scores near perfect but that option is ending soon. 

Message 1 of 41
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Regular Contributor

Re: Shifting Debt no longer working

You need the Dave Ramsey approach.  Tear em all up. As long as you're not 90, you can always come back to credit cards later. 

under normal circumstances you'd tell someone to get a balance transfer card, pay 0% and pay it off. In your case that would be freeing up more of a balance to run up again.

 

id say pay for everything in cash for a while.  By the time you're done, you'll have a much stronger profile.

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Message 2 of 41
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Senior Contributor

Re: Shifting Debt no longer working

You'll get more eyeballs in Personal Finance. I'll notify mods to move the thread.

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Message 3 of 41
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Valued Member

Re: Shifting Debt no longer working

Take a measuring glass, grab a plastic container, Cut a piece of cardboard place on botton of plastic container. pour in the water then Insert credit card with credit information numbers face down towards the bottom.
For each credit card you use  make an equal batch, then place the credit card in your freezer.
This will help remove the temptation to have excessive spending controlling your piece of mind in your life.
PAY DOWN THE DEBT'S, Sometimes it may be easier to pay more or the min, but in the end both payment types will reduce the amount of interest you'll end up paying, and will help to remove the evil of temptation.
Once you learn to manage yourself, then you can manage responsible spending.

Khols $700.00, Dressbarn $300.00, Lowes $5000.00, Gap $1000.00, Belk $1000.00, Guitar Center $2000, Ebay Mastercard $700.00, Credit One $700.00, Merrick Bank $700.00, Capital One $500.00, Fortiva $500.00, Walmart $3000, Amazon $600.00, Paypal $400.00.
Message 4 of 41
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Valued Member

Re: Shifting Debt no longer working

One of the things that helped me early on was realizing there exists wants and needs.
Wants is a reward for the proper management of needs.
Oddly It helped me by applying for a loan for a car, and was approved yet I declined to make a car purchase. I then had applied for a loan from John Deer, and approved for $17,500, but declined to purchase their top of the line lawn tractor.
I then thought of bettering my education and decided to apply for a Sally Mae student loan, I applied for $15k and was extended to $29,500.00 to study academic philosophy.
I also declined that as well.
Do NOT measure your worth based on yur perspective of monetary value, but how well you live your life in principle.
In other words how well you value your conscience and reasoning for a gain.

Khols $700.00, Dressbarn $300.00, Lowes $5000.00, Gap $1000.00, Belk $1000.00, Guitar Center $2000, Ebay Mastercard $700.00, Credit One $700.00, Merrick Bank $700.00, Capital One $500.00, Fortiva $500.00, Walmart $3000, Amazon $600.00, Paypal $400.00.
Message 5 of 41
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Valued Member

Re: Shifting Debt no longer working

The reason as to why I offer these advices, is the very fact that temptation can be strong. Don't waste your years building up a burden that you have the ability to remedy today, early on.
It's never too late.
The next step in your mindset would be for you to cash out your 401k, pay the tax penalty and recycle the underlying problem.
Or perhaps a better remedy from your past habit is to roll over the remaining 401k balance to a private ROTH account which if done properly may not cost nearly as much, but gives you the independence to invest in a potentially higher short term gain, at a much higher risk, some people are disposed to be a Bull.
Not offering financial advice just recommending  potential options.
Remember most 401k plans will prohibit contributions for 6 months before they will allow a reinstatement, and matching contributions, but it may be enough to help you to reduce your debt during that time period.
Also remember you have the Right in option to settle out in any Federal income deductions during employment.
In other words I have used in the past this option during times of higher inflation, especially when the prime interest rate climbs too high, which is never good when it climbs to 3% or higher.
For me it worked out best to contribute Federal payments at the highest level for at least the first six months of the year, then remove contribution deductions the last 5-6 months, while you may get less in a Federal refund you are most likely able to stay on top of the debts (no defaults) and the extra monies can be applied for wants as a break.
Thus in the end being able to pay the bills under the potential increase of the cost of living, creative financing has to be learned.
I'm often made sad when I hear so many people brag about how much more of a Federal refund they get compared to their State refund, when in the end the U.S. government gains about 0.25% on your extra payments, you could vest in the last 5-6 months deferred Federal tax payment of $1500.00 on normal contributions to a Salley May savings account at a 1.70% return rate for 5 months and gain $132.00.
You the people need to understand the system is designed for gain for the opposition, the system is won by understanding it.
Which is better for the economic society the government earning $18.84 ove a 5 month period, or you earning $132.00?
The best part is you get to decide how to dispurse the extras $132.00 in economics than the government using the $18.84 as a subsidization.

Khols $700.00, Dressbarn $300.00, Lowes $5000.00, Gap $1000.00, Belk $1000.00, Guitar Center $2000, Ebay Mastercard $700.00, Credit One $700.00, Merrick Bank $700.00, Capital One $500.00, Fortiva $500.00, Walmart $3000, Amazon $600.00, Paypal $400.00.
Message 6 of 41
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Regular Contributor

Re: Shifting Debt no longer working


@Sbrooks1 wrote:

For the last 2 years I have shifted debt between personal loans, 401 K loans, CC balance transfers etc... but I have continued to charge up CC after. I need a game plan to tackle this. Currently 23000 loan on my 401, a personal loan for a balance of 17000 and now another 8000 in CC debt. Guys I have to stop. I have no hobbies , dont get manipedis, but 4000 of my new debt is pet related. Advice or tips? I work FT about 60 hours a week as a salary RN Director, make only about 300 bucks more than I did last year. I can shift all I want right now with scores near perfect but that option is ending soon. 


Lock up your cards with someone else. Choose the card with the lowest balance and pay that off. Take that payment and freed up monthly payment and go to the next. All the way to paying it off. Pay off your 401K loan. Pay off your personal loan. Why do you have $4k in debt for pets? You brought yourself into it, you can take yourself out. Actually, since you can't control it, cut the cards up. Have someone there with you to ensure you did it. Delete any reoccuring debt on those cards and use cash. As you pay them off, close them. Literally, on the phone making your final payment and close them in one call. Do not except any reason to keep it open. Not even CLI increases. 



Jan 2020
Currently rebuilding. Cards aren't worth bragging about yet.
Message 7 of 41
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Valued Contributor

Re: Shifting Debt no longer working


@Sbrooks1 wrote:

For the last 2 years I have shifted debt between personal loans, 401 K loans, CC balance transfers etc... but I have continued to charge up CC after. I need a game plan to tackle this. Currently 23000 loan on my 401, a personal loan for a balance of 17000 and now another 8000 in CC debt. Guys I have to stop. I have no hobbies , dont get manipedis, but 4000 of my new debt is pet related. Advice or tips? I work FT about 60 hours a week as a salary RN Director, make only about 300 bucks more than I did last year. I can shift all I want right now with scores near perfect but that option is ending soon. 


This really doesn't seem like a lot of debt for a job that (sounds like it) pays pretty well. 

 

What's going on with your housing and transportation expenses? Are you house or car poor?

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Message 8 of 41
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Super Contributor

Re: Shifting Debt no longer working


@Sbrooks1 wrote:

For the last 2 years I have shifted debt between personal loans, 401 K loans, CC balance transfers etc... but I have continued to charge up CC after. I need a game plan to tackle this. Currently 23000 loan on my 401, a personal loan for a balance of 17000 and now another 8000 in CC debt. Guys I have to stop. I have no hobbies , dont get manipedis, but 4000 of my new debt is pet related. Advice or tips? I work FT about 60 hours a week as a salary RN Director, make only about 300 bucks more than I did last year. I can shift all I want right now with scores near perfect but that option is ending soon. 


I don't agree with some of the drastic advice you've been given.

IMHO you should tackle the revolving debt first, using the snowball method:

1. Stop using cards.
2. Pay off smallest balance first, then next smallest, and so on.
3. On other cards pay minimum + something each month.
As each balance turns to zero, that will free up your remaining monthly cash to apply to the next smallest balance.

 

Once you've got the credit card debt paid off, then you can start reducing the installment loan.

 

Once you've got the installment loan down to 9% of the original loan amount, then you can start getting rid of the 401k loan.


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Message 9 of 41
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Community Leader
Super Contributor

Re: Shifting Debt no longer working

My question is, are you living paycheck to paycheck? 







Message 10 of 41
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