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SHORTTOOTH1's Photo SHORTTOOTH1 Posts: 1,036
2/6/08 10:35 A

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Mydays and Ceejay. Those are great ideas. I actually started using the snowball plan as soon as I saw it. I'm surprised how quickly it actually works. I also looked at the powerpay website. I need to think about that one though.

If you greatly desire something, have the guts to stake everything on obtaining it. ~Brendan Francis


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CEEJAY35's Photo CEEJAY35 SparkPoints: (5,908)
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2/6/08 9:23 A

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I agree with Mydays...the snowball effect works. I use a free website at powerpay.org/ it helps you create a "power pay" calendar, that will show you how to use that snowball effect to your advantage. Helps to keep your goals in mind and see how much time it will take you to get out of debt.

Edited by: CEEJAY35 at: 2/6/2008 (09:23)
*´¨) .*
¸.·´¸.·*´¨) ¸.·*¨) Cheryl
(¸.·´ (¸.·´ *

The chains of habit are generally too small to be felt until they are too strong to be broken. ~ Samuel Johnson

Surgery Date: December 15, 2009!!!!!


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MYDAYSCOUNT's Photo MYDAYSCOUNT Posts: 2,245
1/18/08 9:13 A

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First, we stopped using credit cards cold turkey. That was not easy, at all, but absolutely necessary. I went from adding $500-$1000 per month to our credit card balances to paying off $1000 per month. We borrowed from my husband's 401K and my parents to get lower interest rates and a major incentive to turn things around. We cut back on unnecessary purchases. We stopped eating out. We cancelled our newspaper and magazine subscriptions. I stopped buying every little thing for my hobbies.

And most importantly, we used the snowball effect to get our credit cards paid off. If you don't know, the snowball effect is paying more than the minimum on one card at a time until that card is paid off. Then as each card is paid off, you add that payment amount to what you pay on the next card. It's amazing how quickly the snowball works when you stick to it because you're saving sooooo much interest. The interest and late fees were killing us!

We're not completely out from under debt yet, but we did pay off all our credit cards in less than a year. We still owe $55,000 to the 401K and my parents, but the interest rates are fixed and much lower than they were with credit cards and our payments are now automatic. We will be completely out from under the debt in 2012. It's been such a stress reducer, let me tell you.

The hardest part was making that phone call to my parents to ask if I could borrow from their retirement savings. My parents are not rich; they're just closer to retirement, so their retirement savings are bigger. I know I have to pay the money back one way or another, because if I don't, I'll be supporting them when they retire. It's great incentive to stick to the budget.

Don't count the days; make the days count.

Barb


To be nobody but yourself--in a world which is doing its best, night and day, to make you everybody else-- means to fight the hardest battle which any human being can fight; and never stop fighting. - ee cummings


Take the journey of your life one adventure-filled day trip at a time!


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CACOSTA's Photo CACOSTA Posts: 2,460
1/17/08 9:37 P

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Barb,
How long did it take you to dig yourself out, and what did you do specifically to get those cards paid off?
Carolyn

“Know the true value of time; snatch, seize and enjoy every moment of it. No idleness…never put off till tomorrow what you can do today.”
SHORTTOOTH1's Photo SHORTTOOTH1 Posts: 1,036
1/17/08 11:09 A

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Thanks for the welcome. It helps to know that I'm not the only one in this situation.

If you greatly desire something, have the guts to stake everything on obtaining it. ~Brendan Francis


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MYDAYSCOUNT's Photo MYDAYSCOUNT Posts: 2,245
1/16/08 3:01 P

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Good for you for figuring out your situation in such a short time. It took me 20 years to figure out I had to stop living outside my means. Trust me, you can fix it. If I can get out from under nearly $80,000 in credit card debt, I'm sure you can get out from under whatever yours is. Way to go!

Don't count the days; make the days count.

Barb


To be nobody but yourself--in a world which is doing its best, night and day, to make you everybody else-- means to fight the hardest battle which any human being can fight; and never stop fighting. - ee cummings


Take the journey of your life one adventure-filled day trip at a time!


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SHORTTOOTH1's Photo SHORTTOOTH1 Posts: 1,036
1/16/08 2:49 P

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Hello All. I recently decided to use the lessons I learned here on SP to try and recover my financial situation. It's not as dire as some peoples since I haven't missed payments on anything or harmed my credit score. But let's just say it's going to take me a VERY long time to recover from the hole I dug myself into. Let's just say that I've been living outside of my means for over a year and am trying to put a stop to that. Fortunately, I have awesome support from my family but can always use more.

If you greatly desire something, have the guts to stake everything on obtaining it. ~Brendan Francis


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