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We all make mistakes in life and unfortunately my mistake is costing me a lot. As I am getting older I’m finding that a lot of things are based from your Credit. I’m in debt about 15,000-25,000 dollars. Unfortunately the economy is getting harder to deal with and my budget is extremely tight. I made mistakes by being irresponsible and spending money frivolously. I’ve attempted to clean up some of my debt on my own in the past. I’ve not had the best jobs either to really support to pay organizations that say they will help. But it seems like they charge a lot and the places your trying to pay off are getting small amounts of money. I don’t have Credit Card debt. I have an old vahicle loan, medical bills, old electric bills, loans, and other small things. I can’t open a Checking account or Savings account which sucks. The job I’m in doesn’t pay very well and it seems as if I live from paycheck to paycheck. Can anyone please give me some very good advice that maybe I can really use. I’m very serious of trying to get my life back on track. I don’t expect it to get better in one night and understand it takes time for these things. Maybe even give me some budgeting tips. I’m open to all suggestions. Thank-you in advance for everyone that replies.

4 Thoughts on Need advice for getting out of debt!
  1. Reply
    Prince of Pistoleers
    August 21, 2011 at 1:42 pm

    Swallow your pride, do a Chapter 7 bankruptcy to try to start FRESH, and change your ways … pay cash for everything, live within your means, and spend the next several years repairing your credit.

    No credit card debt … what!?!?

    Too bad … that would make it all the more worthwhile …

  2. Reply
    teaser0311
    August 21, 2011 at 1:45 pm

    First things first. Have a yard sale and get rid of every single thing you haven’t used within the previous 12 months. Minimizing the clutter in your living space helps keep your mind focused on living daily with new priorities.

    Pull a copy of your credit report from all 3 credit reporting agencies. It’s important for you to see if any of those creditors have written off your debt, which you can learn from a credit report. Do NOT call them to ask, or they’ll activate your account, and you’ll be sorry.

    The old electric bills are public record reports, and must be paid, or they can follow you for something like 15 years, depending on the state where you live. Old medical bills will stop being reported 7 years after the date of last activity on the account. So, unless those are relatively fresh, don’t pay them. They’ll go away.

    Forget about filing for bankruptcy. You’re not deeply enough in debt to qualify, and if you were, you’d need a huge wad of cash to pay for an attorney.

    As far as managing your money, you need to take a hard look at how you’re spending your income. Every single person I’ve ever met who complains about not having enough money is paying for cable television and cell phones. Those are not necessary living expenses. The things you really need are the things that you will literally die without.

    Groceries do not have to be expensive. You choose what you buy. Convenience foods are much more expensive than food you have to cook. Rice is cheap. Everyone in the U.S. squanders electricity and water. Start watching your habits that cost you money.

    Reduce your optional telephone services. A monthly phone bill doesn’t have to cost you any more than $ 20. Caller-ID has only been available for about the past 27 years. None of us ever died because we had to pick up the receiver to find out who was on the other end of the connection.

    People who whine about the cost of gasoline fail to grasp the fact that the increase in the cost of gasoline just finally caught up with the increases in food prices over the past 40 years. Don’t complain. Just adapt. You’ll be much happier for it. We dealt with a shortage of gasoline in 1979/1980, prices doubled overnight, and our tag numbers determined which days of the week we were allowed to get in line (for several hours) to wait our turn for the privilege to buy gasoline. We learned to be smart about using our gasoline, combining necessary trips, calling ahead to stores to be sure what we wanted to buy was in-stock, and completely stopping all unnecessary driving.

    During the energy crisis of Jimmy Carter’s administration, the public was directed to adjust thermostats in their homes to be a little less comfortable, in order to use less energy. The use of home utilities are very much in your control, if you choose to care enough to exercise control. Unplug appliances not in use, they drain energy even when they’re not turned on. It’s pennies, but in your situation, you need to care about pinching pennies, or you’ll never be free.

    After you’ve taken a hard look at where your money is going, and how you can change your spending choices, then you need to look at your credit report to decide which debt is your highest priority to pay off, and just do it, no matter what you have to give up spending money on to do it.

    I didn’t make smart financial choices for a long time, even though I knew how. I learned the hard way that no matter how bad you think it is now … it can be worse. But, when you make conscious choices as to how you will allow yourself to spend your money, and then stick to those choices, everything else will be easier, because you’ll feel in control of your life.

  3. Reply
    Jeanne R
    August 21, 2011 at 2:21 pm

    Congratulations for making the decision to make your life easier. It won’t seem so at first, but ultimately it will be. You may want to consider getting a temporary part time job so that you can get your debt paid off faster.
    1. Make a budget. Make the budget a week before you get paid. A budget is not a punishment! It is a tool which will free you from ever having to worry about money again. Put everything in your budget. Especially those annual, biannual, or quarterly bills like car registration, insurance, etc. Give every dollar you are going to bring home the name of where it is going. Add an “emergency fund” category to your budget for 25 dollars and save up until you have 1000-1250 dollars. Your emergency fund will help keep you from getting into new debt because of an emergency. If you can, set up a direct transfer to a savings account for your emergency fund. That way it moves automatically and you don’t even have to worry about it. You must cut your spending and live on less than you make.

    2. First get current on all of you debts and make no more late payments. Stop using your credit cards immediately. Do not take on any more debt. Credit cards are like quicksand only the death is much slower. Make a list of all of your debts in order of highest interest rate to lowest interest. Use cash only for your spending from now on.

    3. Pay the minimum due on all of your debts and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on debt #1 (the minimum payment and the extra payment) towards debt #2. That will pay debt #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example:

    To start :
    Debt #1 (highest interest): minimum payment+ extra payment
    Debt #2 (middle interest): minimum payment
    Debt #3(lowest interest): minimum payment

    Debt #1: paid off
    Debt #2: minimum payment from Debt #1+ Minimum payment from Debt #2 +extra payment
    Debt #3: minimum payment

    Debt #1: paid off
    Debt #2: paid off
    Debt #3:Mimimum payment from card #1+ minimum payment from Debt #2+ minimum payment from Debt #3+ extra payment.

    That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have.

    4. After you get all of your debts paid off, add to your emergency fund until you have 6-12 months of income saved up. Put that emergency fund money into a liquid money market fund or into a Bank of America no-risk CD so that if you need the money you can take it out without penalty.

    5a. When you have your emergency fund in place, add a category for “fun” to your budget. Save for a holiday, a vacation, a big screen, or dinners out, whatever goal you want. Remember to enjoy your life.

    5b. When you have your emergency fund in place, start saving for your retirement. Join the 401(k) plan at work and contribute the maximum. You employer probably matches at least part of your contribution so why give up free money. Open a Roth IRA and contribute the maximum on a monthly basis. If you start saving for your retirement now, you will probably retire a millionaire.

  4. Reply
    Ms M
    August 21, 2011 at 2:42 pm

    The best option for debt trouble is negotiating your debts with your credit companies to keep the payments from swallowing all of your income. Typically, you have to get a counseling agency to call on your behalf. If you try to work with them yourself, many of them will not cooperate with you because you are not enrolled in credit counseling. Try http://www.womenindebt.info. Good luck!

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