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Getting out of debt...

M

morf

Inactive
Feb 17, 2006
10,374
11
#1
So I received a letter form my bank today stating that my bank account had been in negative (big number) for over 70 days now and they will come to my house to take my stuff unless i fix it ASAP.

So I started selling all I could like crazy, all except my two main basses and hopefully it wont get to the point where I have to sell them!

How did you get out of debt? How did it work out for you? Let me hear your stories and cheer me up! :)
 
#3
I stay out of debt. I pay off my cards every month. I save and pay cash for what I want.

I had a mortgage, but paid it off. Of course houses cost less in the 70s

Just a matter off delaying gratification and understanding the best deals are done with cash.
 
#4
Thing is, when I started I was not much into debt, a couple of hundred euros, but it escalated and now I'm knee deep into it.

No excuse I know, I should have been more careful.
 
#6
Prioritize. It's knocked my $19k credit card debt down to $13k in only a few months, and it's falling at a rate I didn't predict I never thought I could hit. All this, and I just bought a house, meaning my rent payment nearly doubled. Nothing like having a kid to get your priorities in order...
 
#9
First dibs on Morphs Rocco Edition :hyper:

I've been deep into debt twice in my life. Once due to a divorce, once due to a sickness in the family and HUGE medical bills. It's not fun and it's life changing. Everyone's situation is different and deep down inside, you probably already know what you have to do. I just worked more hours and lived like a hermit. If you can get out of debt without ruining your credit, that will certainly help in the long run. I wish you the best in working your way out of this situation.

LOL @ Diggler :p
 
#11
just buy loads more high end bass gear ...declare youself bankrupt ...sell it all to you mate for a pitance ...then you will have to spend a few years without being able to borrow..big wows...and get yer gear back from yer mate....and have a great bass rig.:bassist:
 
#12
Ugh, it annoys me when people act like only stupid people get into debt. Anyone can get into debt, through things that are or are not your fault.

When I got divorced I was saddled with ½ my ex’s credit card debt because like a dumbass my name was on some of the cards and he was a spendaholic.

I managed OK for a while with the high payments, but then I lost my job. I got behind on payments. I ended up freelancing for about 2 years, which meant I had a job for a while but then would get let go (as freelance work depends on work available) all while looking for a permanent position.

I put all my credit cards in one of those programs that I USED To make fun of. I thought they were for irresponsible people who couldn’t figure out how to mail a check on time, or people who didn’t know how to budget. But I DO know how to budget, I have been managing all my finances on excel spreadsheets for 10 years now. Once you start missing payments those credit card companies just take you down a spiral and you can’t ever get out.

My parents keep saying I’m irresponsible with money, but I keep pointing out you can’t pay bills with money you don’t have, and it’s not like I ever spend it on anything I don’t need. I’ve been living on Ramen noodles for 2 years now.

It takes quite a bit to get out of debt, and a lot of work when you want to play. I work 4 jobs, my main job, freelance video editing, teaching gymnastics and my own cheerleading business. I had to get a roommate. The trick is to work smarter, not harder. Sometimes I put in 12 hour days. You just do it, y’know?

My perfect credit is destroyed and I’m close to foreclosure on my house, but somehow I just keep plugging away and you stay afloat. If you just keep chugging along you’ll make it out. Sometimes you have to think creative. My roommate makes money by selling her used panties on Craigslist to pervs. They pay up to $60 a pair. NOT something I would do, but it shows creative thinking!

Good luck. It seems to take as long as it took to get in to get out.
 
#14
disenchant said:
...My roommate makes money by selling her used panties on Craigslist to pervs. They pay up to $60 a pair....
Click to expand...

Let me know when you start doing this Morf, I know I can find some buyers. :D


My advice:
-Cut up all the credit cards, never use them again
-Make a list of all of your debts, get them all accounted for. This way you'll know how much you really owe. Yes, it will be scary, but you have the face the truth head-on.
-Make a list off all your income, and monthly recurring bills (ledger/budget)
-Keep track of this ledger/budget and every expense, even coffee and pop and cigarettes. You'll be surprised how much of your money goes to eating out and pop, etc
-Trim your expenses
-Put as much as you can toward paying debts them off. You may want to start with the little ones first, then as you pay them off add the money you were paying on those to the others. As you go the process will gather momentum.
-Sell things if you must
-Earn extra income if you must


I'm more than happy to help you with any advice I can give, but I am no expert.

Good luck.
 
#15
Its all about shredding the credit cards, making a livable budget, and staying within that budget.

My then Fiancee (now wife) had a problem with CC debt, and she tried really hard to get it under control before we got married, but she just couldn't seem to do it on her own. After we got married we paid off about 17k in debt in a little over a year, and have only carried a balance 2 or 3 times since then (3 years).

I would consider going to a debt counselor (not necessarily a consolidator) or a family member/friend who you can trust and who you know is good with finances and get their advice
 
#17
I'm constantly on debt, but no huge sums (except from the loans I pay off regularly like my house loan). I also get a regular salary and pays off as much as possible on my debts every month. Sometimes I'm close to 0 on the debts, but then I go buying something which raises the sum again. Seems I will never be able to save any money when I'm in this spiral... It's not out of control, but not too nice either.

One thing in the OP really surprises me. How in the world is it possible to not know you've ben on a huge debt for 70 days??? I check my bank account balance at least once a week on the internet, but once a month would be the absolute minimum. You pay your bills once a month, don't you? And if you haven't paid a bill, they send reminders. As said, this REALLY surprises me. I just don't get it.
 
#18
Your plan needs to be on paper, you need to be able to visualize the ending and how you will get there.

We are working through some difficulties right now ourselves. We started by making a list of "wants", and a list of "needs". Because it was easy for us to justify most everything as a "need", we enlisted the help of my parents and a couple friends to help us properly prioritize true wants and needs.

We're climbing slowly out of the hole. I no longer feel like we'll never get out.

Whatever you do, don't fall for any get rich quick schemes.

-Mike
 
#19
I feel for you morf, I'm kinda in the same boat at the moment. I have learned to love the taste of rice and beans, plain pasta with just olive oil, bread, and the occasional apple. I actually like the life-style I've worked myself into...its very simple. I don't even own a phone. I have a regular 9-5 job and I've been picking up extra money by occasionally working at a couple restaurants/bars owned by a couple friends. I'm kinda lucky in that aspect though, they let me come and go as I please. But I've found finding something like that keeps me busy and away from places to spend my money. And its helped me drink less too...watching drunk people while you're sober will make you think about things.

One thing that's also helped is whenever I'm thinking about buying something I always tell myself, I'll wait a week. Typically I forget after the week so I never buy it...helps me from buying stupid junk that I've grown to hate.
 
#20
Step 1 is to TALK TO THE BANK.

They don't actually want your stuff. It's not really worth much to them, and by the time they've paid someone to collect it, and resell it they end up getting back very little.

They probably don't even want you to pay them back! Sounds silly but if everyone repaid the banks on all their loans, the banks would be out of business. What they do want is for you to make some good faith steps to indicate that you WILL pay it back. If you go bankrupt they loose almost all of what they've lent you, so it's in their interest to help you dig yourself out.

You need to sit down and talk to them about how much you owe them, how much you owe other people, and how much you can pay them back. If you haven't done this already, (and you're not TOTALLY bankrupt already), then they'll agree a repayment plan. They should also be able to reduce your charges by setting up a fixed term loan - far lower interest than an overdraft. If you're REALLY in bad shape, then you may be able to legally freeze your debt, so the CAN'T CHARGE YOU ANY MORE INTEREST (UK law - france probably different).

You should be able to include any other debts in that loan, at a lower interest rate than say credit cards.

however after that its up to you - you've then got to cut up your credit cards, NEVER take out any more credit, and work hard to keep up the payments. Screw up again, and you'll get hammered.

The worst thing you can do (and the reason they will send you nasty letters) is if you ignore them, and pretend its not happening.

Ian
 

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