Save up and pay cash for the cd player while paying down on the cc. $315 is not $315 when you let it ride on a cc. Compute how long it will take you to completely pay off the cc while not adding to the balance. Then take that amount of time times 1+ the cc interest percentage times the $315 and add that to your $315 and think you'd be amazed at what that cd player is really costing you. Roughly what you really pay = (months remaining * (1 + annual rate/1200) * amount) + amount
They negotiated with all my CC companies and cut all my interest rates in half. I saved hundreds of dollars doing it this way. They deducted 1 payment a month from my checking account to pay all 4 credit card payments, making it impossible for a payment to ever be late. They also stopped all collection calls of any kind. They also gave me endless free resources to read up on to help me restore my credit and change my spending habits. I would never be 100% debt free (like I have been for the last 2 years) without them.
I did this once, and found I was eating about 10 times a week at fast food places -- breakfast/lunck or dinner -- on the go! And I thought I'd been eating fairly healthy Changed my eating habits in a hurry!!
Manny Ra, One key principle of saving applies to retiring debt: allocate an aggressive, but realistic, number of dollars per paycheck and have it set aside BEFORE you get your paycheck. So, say you want to pay $500 per month toward your debt. Set up an automatic pay, so you never see the money and have zero chance or temptation to spend that money. Then, the rest of your salary is there for you to use. This gives your debt first priority and your spending habits second priority. You will get used to knowing that there's less on your account. You won't be tempted to go out to Houstons for that nicer meal, or to buy that extra comic book. You just won't have the money to do it. Good luck.
Sorry. I've always just paid off my credit card every month and not stretched myself beyond my means. I didn't know what I was talking about and probably should not have said anything.
It's cool. Sorry for the rolleyes, I edited them out. I get a little passionate about anything involving debt because of the hell I went through in the past with it. I did learn my lesson though, so I've got that going for me...which is nice. Manny, my brother. If you're living rent-free, you should take care of all your debt like yesterday. Once you start paying rent, it's almost impossible to even make a dent in your debts. Any money you pay will just go towards your interest and it'll never end.
Manny, Your CC debt is surely a problem, but more importantly, it's a symptom of your core problem... Just as in weight loss, and alcoholism, and gambling, you must first change your personality. And you should really do so immediately! YOU NEED DISCIPLINE NOW! A) you were already in debt, and rather than fix it, you jacked up your CC debt even more?!?! STUPID! - AND IMMATURE! CC companies get rich off people like you. Do you realize that whatever price you pay for the comic book isn't your total cost? If you add the comic book prices to the amount of interest you've jacked up on your CC, you would never have bought them. B) you obviously live paycheck-to-paycheck. Don't you plan or save for any kind of serious problem you may encounter in life?!?!? If you continue down this path, you will lose your house and belongings! There are vultures in life that will rip people like you to shreds. C) You're in debt $7860 and you're actually considering spending hundreds more on a car stereo?!?! STUPID! Interest on that $7860 is gonna skyrocket quickly and beyond your control if you don't get rid of it NOW! D) You obviously know what you're supposed to do - you know you're not supposed to buy the car stereo. If you didn't know that, you'd have already bought it by now. So I guess you're just posting this to see if people here will tell you it's okay to buy the stereo. IT'S NOT OKAY. DON'T BUY IT. And do a little growing up, while you're at it. If your car drives and has A/C, shut up and lump it. I know this post sounds harsh, but dude, you need a slap in the face. -- droxford
Am I the only one who wants to quit their job and follow A-Train around the country as he brings smiles to the downtrodden?
Manny, I am surprised that you are willing to discuss your issues so openly, given the fact that many on the board know your "real-life" identity. I think ~ $ 8,000 is probably not something you will need to be too worried about given that you have a job and live at home. A lot of people have some debt (Donald Trump had a lot more, by the way) and it is nothing to be ashamed of. There has already been some good advice in this thread, so I don't want to repeat it all...just try to budget and stay away from these silly comic books, you're a grown-up now .
CCCS is the way to go. I'm doing it right now in fact. They are going to save me around $20K and have me debt free in 5 years. Paying my minimum payments would have otherwise taken me 14 years and cost me an extra $20K or so. Good thing about CCCS, while in the plan you CANNOT use any of the cards and apply for new ones. Also I'm saving an extra $700 a month now doing CCCS.
My advice is to pick one interest/hobby and stick with it. In the past I've found myself with so many different interests that I was spending a lot of money on recreation and hobbies. So I basically picked one that I enjoyed the most and let the others slide until my money situation was better. In your case the music, comic books, or whatever. Just pick one and slide on the others until your money problem is solved.
If you're going to school, maybe you can get subsidized student loans, and then use as much of it as possible to pay off your credit card debt. Presumably your student loans will have more favorable interest rates and payment terms. We know you're disciplined, you've posted before about your weight training program. Exercise some restraint when buying CDs and comic books. If you still want to buy comics/CDs, try to trade your old ones for them. You probably have a huge collection of both. Also, don't look at your comic books as an investment. Even if your ENTIRE comic book collection averages yields of 15-20% per year (I wouldn't count on it), Visa still gets their 9.9% guaranteed. I would think of it this way. You are PAYING Visa $800/year to carry a debt. That's a lot of comic books. Sell the dog. (just kidding)
were they increasing at the rate of 15% to 20% annually, compounded? If you put your money in a standard investment vehicle and let it ride for 7-8 years, it should double in value. Unless the comic books double in value every 8 years or less, it seems they are not performing as well as a market port folio. Of course, that does not take into account the joy you may experience owning these particular assets. So when I say they don't produce enough return, I mean in relation to the interest carry on credit card debt. If the debt is costing 10%, then an appreciation up to 10% per annum is exhausted by the debt service. It's break even at the interest rate, and if the appreciation in value is less than the interest rate, you're underwater the difference. the thing to remember is that when you're in a hole - stop digging. if you are doing that, it's just a matter of time before you're back in good shape. locking the credit cards up and forcing yourself to use cash will help get there. Manny, I generally preach conservatism in credit management, so this is my sermon to all who will hear it. Since you posted on this topic, I responded, but my comments are really more general than Manny specific. You gotta do what you wanna do. My feeling about credit is this: get credit, but then save it for appreciating assets or travel. Use cash for expendibles or depreciating assets. It hurts more to spend cash, which is why you should do it.
Once again, I like to thank those who had serious tips or suggestions. I sold my 24 shares of company stock and after 30 bucks went to commission, I am getting a check for close to 1100 bucks! I will probably go ahead and use 315 of that for the CD player; however, I am going to set aside 50 bucks each month and place it in a secondary savings account to pay myself back that 315. I will probably then place 185 in that account just for emergencies and then use the rest which will be over 500 dollars to pay on my credit card next month. I know it isn't really much, but it will get my balance below $7000. Then it will be up to me to stay focused and disciplined. I still have a couple of extra copies of some important issues that I can sell, but I like to hold off in doing that for 2 reasons: 1) I would be selling them at a loss (I overpaid for 2 of these books) 2) If I can get my CC balance down to 4K to 5K, this would be a good time to sell as the prices should go up from what they are now; however, I don't know when that will be but it is better to wait as long as I can so these books can go up in value than trying to sell now. Of course, I wouldn't mind holding onto them, but if things get really bad (which it can always happen), then I have another option out there.
Sounds like a good plan. Here's some Tips regarding the comics. 1. Don't ever overpay for comics if you're looking at it as an investment. If you pay $60 for a $50 issue, you need a 20% increase just to break even. 2. I don't remember your comic investment analytics. However, let's look at the opportunity cost. You have 10% consumer debt. What you're really doing is leveraging the debt to buy comic books and hoping it'll outpeform the credit card interest. Factor in 3% inflation and you'll need about a 13% annual return just to break even. Factor in the risk premium and I don't think it's worth it. And since this is a non-liquid collectible, there is a substantial discount between the "price guide value" and what you can actually get in the open market. Also, any grading dispute can reduce your expected sale price.
I feel for you, bud. A while ago I was in serious debt problems. I owed $3000 or something around that figure, and I'm a student. I have no full time job. It was serious. I didn't know what to do. Worrying about it every day, waking in a cold sweat. Bad news after bad news. Parents getting divored, doing badly at University. Man, I can't believe how one property investment find managed to turn my entire life around. I don't know how I would have taken myself out of debt otherwise. I think I would have had to drop out. So any news? What have you done since your last post ?
