Credit cards, Loans

Most of it was little things

…and simply not saving for a tough time. I’ve known since I was in junior high that the ideal is to have 3 months of expenses saved up so that if you get laid off, or injured, you will be fine. My parents have more than that saved. They have never had more than one credit card. And only in the last couple years for online purchases or travel. And yet they managed to make it just fine with a single income and 3 kids. We also had one of my grandmothers live with us for 11 years. And during that same time, my other grandmother lived with us for a year. She chose to go into a nursing home back in her home town, and later her money ran out, so my dad had to pay that too.

Yet, they have never had bad credit.

And then there is me. I got my first credit cards in college, and I used them to buy text books, books for fun, little stuff that I thought I needed. My first computer.

When I realized it was too much, I started paying higher than the minimum to get rid of it. During the summer, I was paying $200 a week to get rid of them, which was pretty good consider my paycheck. It took me about a year, but i got rid of every one of them and I was thrilled.

I went debt free about 2 years. Then I started up my own small business. I couldn’t get a loan, so I got a couple smaller credit cards. I bought some equipment and supplies. A new computer.

Basically, I was over-confident. I was sure that I was going to do well and be able to pay it off fairly quickly. But while I got lots of compliments on my work, people weren’t buying much. Then I heard about a show in Reno. I do horse photography, and this show was the biggest in the country, and featuring the breed that I specialize in. They were saying 15,000 people would be there.

So, I decided to go. I stocked up on supplies for products and worked really hard. Two months before the show, I received an offer for a $3,000 loan. I knew the interest rate was too high, but I was sure I would make at least $7,000 at the show (plenty to pay that back and ALL of my other debts). And I had enough product to sell over $15,000 if it went well. I was really excited, I expected to be debt free after the show. Sales were $800. That was it. That barely covered the cost of my being there – vendor fee, insurance, hotel, gas, food, etc.

I managed to get almost instant financial help from ElcLoans.com (I recommend this website) to keep paying the minimums until 2 years ago, when I had two expensive vet bills overlap each other. The first was doable. My dog had mange, and she required special medical baths every two weeks for 3 months. Overall, it cost me about $550, but it was spread out. The topper was the cat. He got a bad abcess, and age 16, they wanted to do bloodwork too. So, I had to pay $243 that day, to get him treated and pick him up. My paycheck was only $250. Bills that needed to be paid didn’t get paid on time, and since the cards were already maxed, I had a late fee + overdraft fee. And then of course, the next month, they want the regular amount + anything over the limit + any extra fees. So, a bill that was only $60 is now suddenly $180 and that is impossible to pay. Even if I pay part, some of it is still late, and the fees start over again.

And that is how I came to be where I am. I am not a victim of bad circumstances. I was young and dumb, and I have only myself to blame for this mess. And I know how easily I would do it again. So, I have to change my lifestyle and my *attitude* toward spending and saving. I need to dig myself out of this mess, but also make sure I don’t let it happen again. I already gave up drinking pop (thankfully, I don’t drink coffee or smoke). And I take lunch to work now, which is saving me a ton of money. I can’t believe I wasted so much money before.

And now it kills me to watch my sister keep going down the same path. She is older than me, in far more debt, yet she continues to buy expresso each day. She eats at fast food restaurants each day. She’s been paying for a health club membership for 15 years, yet she doesn’t go. And she won’t cancel it. She has paid over $3,000 into Trendwest and won’t sell it off even though she can’t afford it. She has creditors calling, and certified letters from the IRS for over a year. She had my parents co-sign a debt consolidation loan and has commented she would like to do it again. She gave up her good job to work a more fun job, which paid $4 less per hour and has no benefits.

A year later, she quit that job and was unemployed for awhile. She is now currently working as a nanny/errand person, working 50 hours per week, and only earning $275 a week. So, she works harder than me, earns less, and owes more.

So, my parents have paid $1000 to fix her car, let her live in the rental house for free (she’s supposed to be paying $350 rent + utilities, but she hasn’t paid anything in over 3 months), and they still help with her bills.

And you know what, she hasn’t learned a damned thing. She hasn’t changed her spending in the slightest, and her debt isn’t getting any smaller.

She won’t even use a check register to keep track of her finances. She just calls the banks and assumes that every balance is current, and forgets what automatic payments are yet to come out.

I can’t even go anywhere with her now, because it would mean more shopping for her, and dinner out at a restaurant. I also have to be careful what I cook at home and when. Because she comes to our house to eat. Yes, I live with my parents. I can’t afford my own place, so I rent part of the basement, and I help support my nephew who lives with us. That doesn’t help me pay off my bills any faster, but with all the crap my sister is doing, I have to help somehow.

I really do believe that getting out of debt is financial fitness, just like health fitness. We have to change our lifestyle, our attitude. We can’t just go on a quick fix, get it cleared, and then everything is good again. we have to really change, and keep those changes even after things look good. Or we are doomed to fail again.

Budgeting and saving, Gift ideas

Everyone except my nieces and kids get framed Photos

Everyone except my nieces and kids get framed Photos. I buy wood frames used at garage sales and spray paint them flat black as that shows off the photos the best. New glass is cheap and cutting glass it easy. If the glass is broken or missing you can get nice frames for .10 to .25 otherwise it is about 1.00. Sometimes if you show up at the end of a sale you can get a whole box for $1 to $2. I use a white museum quality mat and foam core and finish it nicely with acid free tape.

I always sign and date and put a personal note on the back. A part time job with a custom frame place will give you lessons on mat cutting plus access to a mat cutter and materials cheap plus a little income to pay for your supplies. Do well and build a relationship with the owner and you can go back and cut mats for birthdays and other events. I have collected from Grandparents old family photos and documented them well. The old sepia prints on great grand parents and other family history make great wedding presents when framed in a more elaborate formal way too. After you do this you can do mats and frames for friends in exchange for babysitting or other things you might need like cash. They are always looking for extra people during the season.

I have invested in a very nice camera because that is a favorite hobby and in the end it has paid for its self. If you need photography lessons then ask at your local photostore or find out the teacher who teaches at your local community center ask if you can assist in class in exchange for coming. People complain when I find that perfect gift and buy them something else. We bake cookies for token gifts (mail person, garbage person, neighbors) and put them in hand decorated brown lunch sacks lined with waxed tissue that I buy from a local bakery for wholesale. I also organize group gifts for teachers and daycare people and Girl Scout leaders with other parents.

This is very much appreciated and takes little effort and in the end if you can give a teacher or day care worker a $200 American express gift check from 20 to 30 people then they feel much more appreciated as you went to the effort to ensure they got something nice. These are people who deserve big gifts but alone it is impossible to make this happen. We collect individual cards from each giver and put them in a large envelope. Every year I organize this it gets easier and people start expecting so they don’t buy ahead they know I’m going to do this. Occasionally someone offers to help.

I do very very little shopping at Christmas. My kids each get 4 things something they want, something to wear(usually PJs),. something to read, and something they need. Stockings are filled with art supplies and candy a tooth brush and a trial sized tooth paste. These things come from the entire extended family not just me so it is pretty much 4 things to open at Christmas. My mom sews so she makes the PJs and sometimes a pillow case to match. My sister is in charge of books and takes great care in selecting the right one for each kid( she loves books). Used books are fine and used items in general are considered a cool thing.

Our family is very much at the point it is the thought that counts and handmade gifts that are personal are considered in very high regard. The thing with overspending on Christmas is when you do this people feel they have to reciprocate. It might take a few years for a new in-law to get with the program but if you don’t follow suite and continue to do the nice but handmade item they will get the picture that is what you want too. Those that are not crafty buy supplies or gift cards for supplies.

Credit card debt

Nobody is blaming credit card companies for getting people into debt

if you would only read the posts and get off the one-trick pony. NOBODY—I REPEAT—-NOBODY IS BLAMING CREDIT CARD COMPANIES FOR GETTING PEOPLE INTO DEBT.

I’ve never blamed them for my debts at any time—–nor had anyone else on the board. Since this is a debt control group—-we’re not out of line by “complaining” about the credit card companies’ ways of doing business. It is crucial to debtors all over the world to be aware, so that they use wisdom when making credit decisions.

Where are you getting your stale idea that we’re saying credit cards are to blame for debt?

There’s nothing—absolutely nothing—-wrong with those of us who feel the way we do about the credit card companies to try to promote awareness before taking on credit card debt. So many people may not be aware. But you keep drowning out that message with your continuous, broken record “pep talk”, telling us that we are responsible for our own debts. WE KNOW THAT.

Oh, bless your heart. After all the posts, you are STILL misunderstanding and hanging on to your opinion that those of us who rally for credit card reform are trying to blame anybody else for credit card debt.
Kannette—–it is a well known fact that the credit card companies pay very well to have their practices “overlooked” by the government. There is a massive petition under way to Congress to stop this, because it is in the PEOPLE’S best interest to do so.
Please—-if you don’t understand what you’re reading, and stay stuck in whatever gear you’re in—-then stop criticizing with comments that show that you are NOT able to comprehend what you read.
Like I said earlier—-you have the right to refuse drugs if you are offered them. WE all do. But that does not mean the drug dealers and pushers still should not be held responsible for their part in the problem. Same with the credit card industry.

It’s no use trying to make the point—-it’s lost on you. You’re unfortunately stuck in never-never land where you mind your own business and pay your own debts and hope believe the big, bad wolf can’t blow your house down. Well, that’s fine. But the predatory wolves we’re talking about, if not harnessed, will continue to wield their power and it eventually will effect —– yes, even you.

You can’t seem to get enough of showing how misinformed and how very little of the posts you read. You can’t really be so blind. Kannette—-did it ever occur to you that credit cards could change terms in mid-stream, after many consumers had the cards for a while? The Universal Default which most of them subscribe to now, was not enforced until after many, many people had already been customers for some time. If you would ever read about the world around you, (or, hey, even read ANY posts) you’d see that is why so many honest, good rated customes went into default. Because the credit card company, using their NEW rule, looked into the person’s credit and saw that they had applied for credit somewhere else. And—ZAP—-they got hit with a much higher rate.

ARe you really so blind that you don’t realize that the cards may have changed their policies, without your consent, after you’d had the card for a while?

My idea of hell—–being held for eternity with you sitting there, repeating over and over, about credit being our responsiblity—–not the cc companies. And me, shouting, that’s not what we’re saying.

Read the posts. Please read them before you comment.

Credit and lending

Do other countries have the same belief?

“How can a culture go from being shameful, about having to use credit, to its prestige to have a platinum card in 50 years? Do other countries have the same belief?”

That’s easy in one word “Marketing” Our culture is now driven by the media not by our grandparents and parents values. The bottom line is my grandparents would have found a plot of land and planted it with neighbors to ensure they could feed their family and have adequate savings. The media is there to ensure business get support. They want consumer driven culture and they have been very successful at changing American culture from family values to consumer driven over the last 25 years. They have no reason to support thrift. Heck my great grandfather only was able to get work about 5 to 7 months a year. My grandmother took in laundry and cleaned houses to help raise 12 kids. A man who took out credit to support his family was considered lazy and having poor impulse control even though it took on average a month to get that credit.

The media is very skilled at altering perspective. If your perspective is you “NEED” unsecured credit then it is being driven by the media and you should take a look in the mirror ( and yes that includes me). Needing credit to buy a depreciating asset like a car is a foolish idea that comes from being told that a car is more then a way to get from point a to point b and the only way to get from point a to point b is for every adult member of a household own one big enough to transport half your kid’s soccer team and their equipment with a suspension designed to navigate dirt roads which the average family rarely pass.

Let’s face it we have twice as much stuff and much space in our houses then the average family did 50 years ago and we have the debt to prove it. And we whine about it and blame it on unemployment, car repair, and other stupid excuse rather then taking responsibility and stepping up to the plate and saying this is screwing up my life and I need to change. Debt is the result of overspending and poor planning. We should all plan on unemployment, car repairs, medical bills and lots of other things like rain will happen.

Change starts with a change in perspective and if we don’t get our heads our of our _____ then we will fall back into the same trap we find ourselves sitting in right now.

Credit and lending have been around since before there was money. There are expectations on both sides and laws that predate history have come about to help the process. Countries and businesses couldn’t exist without credit. It’s a necessary financial tool that every successful person has used.

I’ve heard it said many times that every successful business has three key components: a sharp lawyer, a good accountant and a friendly banker. Credit has to be managed and regulated so that it remains the useful tool that it’s supposed to be, but the bankers have bought favors from our government and they’ve changed the ground rules in mid-stream. The calculated risks that were made at the outset have changed and now borrowers find themselves in places they never imagined were possible. That just isn’t right.

What’s next? Expect to see, “Yes you made all your payments on time, but since we saw that you were sneezing, we decided that you wouldn’t be able to keep up that second job so now we consider you a greater credit risk and we’re jacking you up to 30 percent interest anyway”. Not far-fetched is it?

Credit card debt, Interest rate

Your post is not helpful

Once again, your post is not helpful. There is nothing here to give practical advice to deal with the debt other than the obvious: pay it off as best you can.

Well, I think the goal of everyone in this group is to find a way out of debt. And, the first step is taking responsibility for spending habits. Complaining about CC companies doesn’t provide individuals with ideas on how to get out of debt either. There are times when individuals just want to vent their frustrations. I imagine we are all frustrated and complain when the bill arrives, and when the check is being written. Unfortunately, the debt is still there regardless of how much we complain.

Many of you have been successful in reducing your interest rate when dealing with certain credit card companies. Members need to know how you succeeded. Others have posted how they’ve reduced their spending habits and used that money to pay off loans. Others have chosen to use reputable credit counseling services. Everyone’s situation is unique and it would be great if members could provide input as to how they are able to make it through the tough times, and their successes, while struggling to get out of debt.

The foundation of reducing debt is creating and maintaining a budget. A budget will help you find extra money, if there’s extra money available. If there’s not, maybe a part-time job is needed, or securing the services of a credit counseling service. You must research these companies. If you don’t, you could end up in a worse situation. Many people worry that their credit will suffer. If you are deep in debt, with over limit and late charges, then your credit has already suffered. They are able to lower interest rates and help you keep your head above water. If a reputable credit counseling service can’t help you, then chances are bankruptcy may be your only alternative. Unless, of course, you have a rich aunt or uncle.

There are many ways to reduce your grocery, clothing and entertainment expenses. There are books in the library that will give you tips on living on a dime. There’s one book many of my clients have read titled “Smart Cents, Creative Tips and Quips for Living the Skinflint Way. Skinflint: (n) A thrifty person who saves time and money by all means possible. Getting out of debt takes time, work and determination. Oh, and ALOT of patience. Sometimes the light at the end of the tunnel is barely visible. But, on the flip side, the satisfaction of getting out of debt is priceless.

Budgeting and saving

It’s great you found a way to “get away from it all”

It’s great you found a way to “get away from it all”. It’s all about the little things that get us by!

When our children were smaller, (we now have teen-agers), we cut out fast food. Instead of going to McDonald’s, we made up a picnic and went to the park. (they were happy with peanut butter and jelly!) We spent hours there, and we all had a good time. There was more family bonding in the park than at McDonald’s where the kids just played by themselves in their little playland. AND, the kids LOVED it!

I would love to see how high Americans would pay. The only way you could do that is to jack up the price, though, as surveys would tell you nothing. I bet a lot of people would “say” they would not pay $5 a gallon but if it got that high, I’ll bet they would.

Frankly I would not mind paying $7 a gallon if it made people change there driving habits. Both in the amount they drive and what they drive and how often they look for alternatives to driving.

We live in the sticks and don’t have any choice but to pay it. There is no public transportation. We don’t even have a convenience store. I definately limit my trips to town. Now I have to need about 10 things before I’ll head to town, where it used to be 3 or 4. Even at $5, I would still have NO choice but to pay it.

You bet they’d pay it. I don’t even think driving habits would change very much. Americans will do anything for their cars. They’d give up the kids first.

I could not afford to pay $7. But you have a good point. One time on the news, a comment was made, reportedly by a gas company spokesperson, that as long as people did NOT change their habits and continued to drive as always, the prices would not go down. If we show we’re willing to pay it, and continue to drive the same, I guess they will assume we have no problem with it.

Yes but do they have public transportation? How many have even have cars? We as a socity have to have gas, to get to our jobs, our famlies, to function in society. It is a need. It may even be an addiction.

No we don’t need a 60K car to do this, but we live in a country that expects you to have a car, and drive. I’m happy to see see that cars now are getting better fuel eco, hybrids(though you’ll pay more), but more needs to be done.

Oil had its time and place, its time to move on. I’ll step off my soap box.

Budgeting and saving

I would love to hear from others about daily life

Such good points. I would love to hear from others about daily life and ways in which we all reduce our spending, stay in our budgets and maintain their budgets and still find ways to grow a savings.

I’ve had to make many adjustments due to gas prices, but am finding it’s not so bad. I started, a while back, a savings account with Capital One 360. It, or any online savings, is such a convenient way to save—-the money is drawn automatically from my bank account every payday. I’m not missing the money anymore, and have adjusted my budget around it.

I would love to hear from other members on their budgets and ideas for staying within them.

My biggest economic cutback was when I quit smoking. $200.00 a month wasn’t going to cigarettes!!

My house is filled with, except for the dining room light, Fluorescent bulbs. This cut my electric bill by about a third, and many of the newer ones look like ‘normal’ lighting.

We updated our furnace to a forced air heater in 2000. a usual $110.00 Gas bill went right now to $28-40.00, and 60 in the winter.

I primarily use the microwave instead of the electric stove, with the exception of Pasta and stews, and that keeps the bill low too.

I buy plain clothes and can decorate them myself. 5 for $10.00 tee shirts become ’boutique’ with my paintbrush and a touch of glitter! I can sell one or two and ‘pay’ for them and the paint…

Cheap cuts of meat, de fatted and marinated overnight, makes for good eating.

Couldn’t afford new flooring, so I stripped up all the carpeting, and PAINTED my slab floors, like they do in Lofts. Looks cool.

Thanks for the ideas! I’ve also found some shirts and jackets in thrift stores. use odd leftover bits of yarn to crochet or knit collars and cuffs. Lionbrand.com has great patterns and they’re free. Go to yard and rummage sales to pick up yarn cheap, just keep an eye out for moth damage. Have you tried putting the meat in a slow cooker or crock pot? After sitting 6 to 10 hours even the toughest, chewiest meat is cooked tender. For stew just use leftovers (potatoes, veggies, scraps of meat, can of condensed soup like vegetable without the water) and leave it on low all day.

My budget is pretty tight with living expenses and trying to pay off debts. Once a year I want a vacation, usually 4 days, to just get away from all my worries and to gather up the energy to keep going. So all year long I save my change in a jar. When the jar is full I turn in the coins for cash and stash it in my savings account. then once a year I pull out just the money I put in (leaving the intrest) and go somewhere away from home. A guy at work has a couple of rental cabins by a lake. He offers me a discounted rental because with the divorce and kids I don’t have a lot of money.

My mom works in a restaurant. She collects all the dollar coins and half dollars that show up plus lots of the regulars save theirs for her. A couple of weeks ago she cashed them in and got nearly $300 which covered her annual family reunion weekend.

Personal responsibility

Can we agree that people have to take responsibility?

Can we agree that people have to take responsibility for the debt they accumulate AND our governments should have rules in place limiting term changes and interest rates and factor service charges into interest rate caps?

But the kicker is that if this is done then credit will dry up to those that are not well qualified or those that need short term cash.

Why?

Let say we get our wonderful people responsive government cap interest rates at 20% and factor in service charges to the interest rates. This is a very reasonable sum and for standard credit cards and loans is plenty to ensure profit. So the total service charges and interest could never exceed 20%. Service charges are processing fees, balance transfer fees, late charges, prepayment fees, collections fees, legal fees. anything you would pay to someone loaning you money. Just keeping it simple we know government won’t but let’s just pretend they are capable of doing so.

The most they could charge for a $400 loan is .22 a day both interest and service fees. This would make it hardly worth it to provide payday loans and other short term incremental credit or loans to those likely to default.

In other words the less profitable something is the more limited it will be.

Another conclusion considering how abundant easy credit is would lead one to believe that it is extremely profitable.

The practice, called universal default, started after a rash of bankruptcy filings in the mid-to-late 1990’s and has increasingly become standard in the industry.

You’re welcome… I like coming here for the info, but sharing the good is also nice. I still look and use this new lappy with awe. I got some chat thing called Skype yesterday and yakked with the ‘angel’ who sent this, and he’s a geniuinely nice dude in Texas… (I could listen to that drawl all day). My fella and I spent about an hour yakking about Macs, Dogs and all with him.

Poor guy’s wife was t-boned yesterday outside of Houston, she’ll be OK, some broken bones, but is staying a couple of days in the hospital, so he needd to just chat and yak for a while. Man, I know he works in insurance, so at least they’ll be one up on the other person who ran the red and hit her (More towards the back passenger side, so her injuries weren’t “Severe”). Dang it. He says she’s a firecracker and will be ‘juuuust Fah-n’… AWWW!

I actually got Quicken and have been using it here on the new lappy. I think keeping a watch on my spending (Online pays and ATM/Checks etc) here instead of relying on what online sites say will be better . So this brings to mind a question: What software, if any, do folks use to track their financial activity?

Budgeting and saving

Christmas is just around the corner

Christmas is just around the corner and I imagine we are all thinking about the cost. Christmas doesn’t have to break the bank.

Presents for family and immediate friends can be oriented towards the time you spend with them than the money you spend. Trust me, most of the people close to you would like to spend time with you rather than have you buy them something they may not use. My mother taught me that. I won’t get into that story though. My brother has two small children, 3 & 1; an evening out without the kids, knowing they are in a loving, caring environment, without teen-agers watching their kids is more valuable than any present I could buy him. If you have to buy presents where you work, consider something homemade or baked. Chances are, they don’t get that kind of stuff on a regular basis. Your parents, if they are close, just want to spend time with you. Give them a certificate for a dinner once or twice a week for a year. If they live far away, create a picture disc of your family, or a video, or make a family collage of what’s been happening in your family over the past year. Remember money doesn’t keep a family together, memories do. Christmas is about what’s important, not what’s been bought.

One of my staff gave me a great idea, but my children are grown and I wish I would have thought of it myself. Christmas is about the birth of Jesus, so the focus should be on the meaning of His birth. She doesn’t spend much on Christmas, but she saves her money for their birthdays. Which, for her, is the greatest give she was given. That’s when they get the good presents.

The thought of buying gifts for everyone almost ruins the season for me! Not that I don’t like to get for people, but the gifts I can afford are just “token” gifts, you know? I like the idea of spending time with people. I LOVE gift cards for me, but some people act offended if you get them that. Anyone have good ideas for grandparents? Mine are all in their 80s. How would you give a gift that would be spending time with them, too?

My husband and I have an every other year gift cycle. Meaning that this year will be a small, token gift year (as mentioned by Jennifer) and next year will be gifts that are more substantual. But the thought of the stress associated with feeling like this an expectation every year really sometimes depresses me, also.

I know how that is with gift cards too. My mother-in-law hates gift cards (she claims because they require no thought) I can see her point – but when you have many relatives in other states and then calculate shipping fees… etc… and then the fact that what you got them may not be right anyway, sending a nice gift card to their favorite store only allows them to chose a gift they really want. Then everybody is happy, I think.

My grandmothers are both in Prague, Czech Republic. For Christmas they really enjoy a small photo album of pictures of my husband and I enjoying our life from the past year. This means more to them than anything, besides us finally visiting one day (but that wouldn’t be over Christmas, because it’s too darn cold there then) After this coming up holiday season, we are expecting our first baby in late January, so I’m sure the holidays will much different after that.