Well, first, a big thank you to the two readers who have started the process of our paying off the big credit companies and turning it into a commitment for good. I will not list the whole email addresses, but thanks to jbuard and honeydoo for their kind donations. We have started a log of those donations, and are already committed to giving that money forward to a worthy cause once we get the debt taken care of. I am certain that we will feel so much more free to do so once we are not paying for interest.
Speaking of interest, I calculated that currently, we are paying $742 a month in INTEREST only. Then on top of that there is a small portion ($278) that goes to principle. Um, I am pretty good at math, but I wouldnt need to be an expert to conclude that if I am paying three times as much interest as principal, then I will be in debt, well, forever. But just imagine how much that interest money could do if given to a church or a food bank or the red cross. I could go on and on. That is what I would like to do someday.
Yes, it is our fault for getting into this situation, but I will say we are desperate to keep working to get out of it. Once we are, we will never be again.
Saturday, December 29, 2007
Friday, December 28, 2007
So it is after Christmas now, and we are nearing 90 days late on two of our accounts. I know because they called again today to tell me so. I have to admit, the two ladies I talked to were nice, and they offered me a kind of payment plan they said would eliminate the late fees and get me on track to pay it off, etc. But I also have to admit that even the payment plan they offered is out of my limit. I am not sure my mortgage is going to be paid, much less that account. Yikes.
Monday, December 3, 2007
I've got mail! (Sort of...)
In Todays mail I received no less than three credit card offers from companies. One of them is a company whose card I have already, and am late a payment on.
What I would like to know is, if the companies can easily pre-screen me, and could easily know that I am overextended, then why do they send me these things?
Ok, maybe I know the answer. I have been learning about it for awhile now. The credit card companies simpy want to keep me in debt. They give me cards, and keep raising the credit limit. Other companies do the same. Then at some point I reach a limit and miss a payment. Immediately there are late fees, and the interest rate skyrockets. Suddenly I owe more, and in a much more immediate way. But still there are other companies who see this and STILL want to pounce.
Ok, I agree, yes, I got myself in this mess. But isnt it interesting that when hardship arises, and a moment of financial truth hits, the companies just make it harder for me to pay it off, as opposed to having some kind of grace period or leniency and a decent amount of customer sevrice and help?
I cannot wait until the day that I am free of these companies.
What I would like to know is, if the companies can easily pre-screen me, and could easily know that I am overextended, then why do they send me these things?
Ok, maybe I know the answer. I have been learning about it for awhile now. The credit card companies simpy want to keep me in debt. They give me cards, and keep raising the credit limit. Other companies do the same. Then at some point I reach a limit and miss a payment. Immediately there are late fees, and the interest rate skyrockets. Suddenly I owe more, and in a much more immediate way. But still there are other companies who see this and STILL want to pounce.
Ok, I agree, yes, I got myself in this mess. But isnt it interesting that when hardship arises, and a moment of financial truth hits, the companies just make it harder for me to pay it off, as opposed to having some kind of grace period or leniency and a decent amount of customer sevrice and help?
I cannot wait until the day that I am free of these companies.
Sunday, December 2, 2007
Making the Cut
Today we did it. We cut up our credit cards.
Well, all except one, but it has a very small credit limit and small balance (Thanks to our already big credit load) and we figure we should have a reserve in case a big need arises, like a car breakdown or plane tickets to visit sick relatives, etc.
It was a small ceremony in our home, totally missed by the people passing by, but it was a big deal for us. Now the only thing to do with the balances we have on them is to pay them off. Hopefully.
There were three of them, totalling all but 24,000 of our debt.
It feels a little odd, like I am a little helpless without them. But they were becoming useless anyway because they were maxed out. Havent used them in awhile. We just had them, and looked at them.
I suppose it is good to try to rid our house of the poison.
But hard to limit our selves. Even though we know it is a big problem for us, just knowing we have only a tiny amount of credit available is a big step in limiting our debt.
They say it all begins small. It was small. But big.
Well, all except one, but it has a very small credit limit and small balance (Thanks to our already big credit load) and we figure we should have a reserve in case a big need arises, like a car breakdown or plane tickets to visit sick relatives, etc.
It was a small ceremony in our home, totally missed by the people passing by, but it was a big deal for us. Now the only thing to do with the balances we have on them is to pay them off. Hopefully.
There were three of them, totalling all but 24,000 of our debt.
It feels a little odd, like I am a little helpless without them. But they were becoming useless anyway because they were maxed out. Havent used them in awhile. We just had them, and looked at them.
I suppose it is good to try to rid our house of the poison.
But hard to limit our selves. Even though we know it is a big problem for us, just knowing we have only a tiny amount of credit available is a big step in limiting our debt.
They say it all begins small. It was small. But big.
Saturday, December 1, 2007
Upon Entering Debt for the First Time
Ok, here's some of the story behind our plummet into debt.
My wife and I have been married 11 years. We are both schoolteachers, and love teaching. About 5 years ago, we decided to see if we could start a family. We tried, and in a few short months were expecting our first child. However, at 6 weeks my wife started feeling intense abdominal pain, and after several trips to doctors, found out the pregnancy was ectopic. My wife needed immediate surgery and would have, according to the doctor, probably died in another few hours due to internal bleeding. So our first attempt at a child was not only failed, but ended in a traumatic trip to the ER and two weeks recovery.
On our second attempt, the Lord gave us a beautiful, healthy baby boy. He is amazing, learning new things every day. We love our time with him and can't wait each day to see what he will do next.
After our first child came another pregnancy, but that ended in miscarriage. Subsequent doctors visits have confirmed for several reasons, that another child is unlikely, and that our first was a minor miracle.
So we have only one child where there would have been three. This has taken a huge toll on us, mentally and emotionally. I do not list this as an excuse, but rather my own thoughts about our spending. I think when the world seems so hard and sad, it is often easier just to treat ourselves to something rather than making a hard decision about saving money. So we spent to help us get through the day with a little happiness.
Also, we decided, probably rather naively, to try to do our best with the child we have and not send him to daycare. Rather, my wife has stayed home with him now for three years. On the one hand, it has been the best for the child, since he is with his loving parents all the time, but it has been bad on our finances, having only one job.
So what did we do? We kept paying our bills and buying groceries and a few little things here and there. Nothing extravagant like big vacations or cars or whatever. little things. But at the end of the month it always added up to more than what I earned. Big problem, right?
Ah, not when every creditor in the universe sent us card offers, and the ones we had sent us those "convenience checks" that we could just write out and deposit, and Bam! money back in the bank account. So we would get cash advances or use the checks to balance the daily budget, and then move into the next month. They all sounded so easy, and so slick, and we admit we were taken in.
Yes, we did make the decision every month to take more credit. We have come to grips with that. It is our fault. And after a couple years of it, we looked at our statements and realized we were taking out more credit just to pay the payments on the other ones! Talk about revolving credit.
We have stopped taking out new credit for two months now. My wife has started a part-time job, since she has not found a full-time one yet. I started working a second job, too. But still the credit has gotten out of control.
We have missed payments and our credit is hurting.
We rarely see each other, and seeing each other has been for 11 years the greatest joy of our days.
We see no end, and are losing hope. Soon we will need to either file bankruptcy or undergo litigation.
WHAT WE WOULD LOVE TO DO:
We have liquidated everything we can to help pay off the bad debt. BUt it is nowhere near enough. Family members are trying to do the same, but it is slow. But debts keep going unpaid and we are getting desperate.
We would love to have help to help us pay off what we owe. But we do not think we should get a free ride. No, we are against that. We need to stand up and be accountable for what we have done. I tell my students that all the time.
And if we get help, any help, we PROMISE to give it back to the community. Charity. Church. Any place that helps people.
We want to get back to being a part of the help for our community. We are asking that if you help, we would work it back into our budget after paying off debt.
We can balance our budget with our mortgage, our cars, and our expenses on my one salary and still not need daycare for our son, and we pledge to do so. We can even include a monthly allowance for charity. But right now the interest is killing us, and we cannot keep up.
Since we have missed payments, our interest is now above 25% on all our accounts. Just yesterday we received notice that one of our accounts went from 8.9% to 29.99% last month because we were late. We had a hard time paying it to begin with, but now the payment went from $108 a month to $228 a month. Things are getting bad.
Please, if you feel at all stirred by this blog, please consider helping us out. We promise your help wont stop here.
For the future, I will keep posting on this blog with more of my own catharsis about the situation, updates on our attempt to get out of debt, and any successes or pitfalls along the way. Thanks for reading.
My wife and I have been married 11 years. We are both schoolteachers, and love teaching. About 5 years ago, we decided to see if we could start a family. We tried, and in a few short months were expecting our first child. However, at 6 weeks my wife started feeling intense abdominal pain, and after several trips to doctors, found out the pregnancy was ectopic. My wife needed immediate surgery and would have, according to the doctor, probably died in another few hours due to internal bleeding. So our first attempt at a child was not only failed, but ended in a traumatic trip to the ER and two weeks recovery.
On our second attempt, the Lord gave us a beautiful, healthy baby boy. He is amazing, learning new things every day. We love our time with him and can't wait each day to see what he will do next.
After our first child came another pregnancy, but that ended in miscarriage. Subsequent doctors visits have confirmed for several reasons, that another child is unlikely, and that our first was a minor miracle.
So we have only one child where there would have been three. This has taken a huge toll on us, mentally and emotionally. I do not list this as an excuse, but rather my own thoughts about our spending. I think when the world seems so hard and sad, it is often easier just to treat ourselves to something rather than making a hard decision about saving money. So we spent to help us get through the day with a little happiness.
Also, we decided, probably rather naively, to try to do our best with the child we have and not send him to daycare. Rather, my wife has stayed home with him now for three years. On the one hand, it has been the best for the child, since he is with his loving parents all the time, but it has been bad on our finances, having only one job.
So what did we do? We kept paying our bills and buying groceries and a few little things here and there. Nothing extravagant like big vacations or cars or whatever. little things. But at the end of the month it always added up to more than what I earned. Big problem, right?
Ah, not when every creditor in the universe sent us card offers, and the ones we had sent us those "convenience checks" that we could just write out and deposit, and Bam! money back in the bank account. So we would get cash advances or use the checks to balance the daily budget, and then move into the next month. They all sounded so easy, and so slick, and we admit we were taken in.
Yes, we did make the decision every month to take more credit. We have come to grips with that. It is our fault. And after a couple years of it, we looked at our statements and realized we were taking out more credit just to pay the payments on the other ones! Talk about revolving credit.
We have stopped taking out new credit for two months now. My wife has started a part-time job, since she has not found a full-time one yet. I started working a second job, too. But still the credit has gotten out of control.
We have missed payments and our credit is hurting.
We rarely see each other, and seeing each other has been for 11 years the greatest joy of our days.
We see no end, and are losing hope. Soon we will need to either file bankruptcy or undergo litigation.
WHAT WE WOULD LOVE TO DO:
We have liquidated everything we can to help pay off the bad debt. BUt it is nowhere near enough. Family members are trying to do the same, but it is slow. But debts keep going unpaid and we are getting desperate.
We would love to have help to help us pay off what we owe. But we do not think we should get a free ride. No, we are against that. We need to stand up and be accountable for what we have done. I tell my students that all the time.
And if we get help, any help, we PROMISE to give it back to the community. Charity. Church. Any place that helps people.
We want to get back to being a part of the help for our community. We are asking that if you help, we would work it back into our budget after paying off debt.
We can balance our budget with our mortgage, our cars, and our expenses on my one salary and still not need daycare for our son, and we pledge to do so. We can even include a monthly allowance for charity. But right now the interest is killing us, and we cannot keep up.
Since we have missed payments, our interest is now above 25% on all our accounts. Just yesterday we received notice that one of our accounts went from 8.9% to 29.99% last month because we were late. We had a hard time paying it to begin with, but now the payment went from $108 a month to $228 a month. Things are getting bad.
Please, if you feel at all stirred by this blog, please consider helping us out. We promise your help wont stop here.
For the future, I will keep posting on this blog with more of my own catharsis about the situation, updates on our attempt to get out of debt, and any successes or pitfalls along the way. Thanks for reading.
So about the charity thing. Why did I come up with this thought?
First, I am a public schoolteacher. I teach science in a public school in Pennsylvania, just outside of Philadelphia. Anyone familiar with the teaching profession knows that it is a job for servants who want to change the world by impacting students. Plus, we often dont get paid as much as other fields, especially for us scientists.
I love my job. I love seeing students every day, and talking with them and seeing them learn about the world around them. I teach 11th grade, and see about 100 students each day. But I am not in it for the huge paycheck. If I had been, I would have gone to work at a research company and earned more salary, along with perks and bonuses and advancement. No, I love teaching and the interaction I have each day with my students. I want to continue doing that.
My wife and I used to give regularly to other organizations. We used to tithe at church (we still go to church), and used to donate when we could. But since our financial situation went downhill, we have not been able to. And we want to begin doing it again, as soon as we take care of the money mess we have made.
So our thought was this: Suppose we enlisted the help of others who would like to donate to charity? The money they would give would actually accomplish two things: 1) Help our family (including our 3 year old) out of debt and back onto a budget which we pledge to keep. We could then avoid bankruptcy. 2) Help community organizations once we are out and able to work it back into our budget. I know it sounds farfetched, and takes a good deal of faith, but right now, that is all we have.
First, I am a public schoolteacher. I teach science in a public school in Pennsylvania, just outside of Philadelphia. Anyone familiar with the teaching profession knows that it is a job for servants who want to change the world by impacting students. Plus, we often dont get paid as much as other fields, especially for us scientists.
I love my job. I love seeing students every day, and talking with them and seeing them learn about the world around them. I teach 11th grade, and see about 100 students each day. But I am not in it for the huge paycheck. If I had been, I would have gone to work at a research company and earned more salary, along with perks and bonuses and advancement. No, I love teaching and the interaction I have each day with my students. I want to continue doing that.
My wife and I used to give regularly to other organizations. We used to tithe at church (we still go to church), and used to donate when we could. But since our financial situation went downhill, we have not been able to. And we want to begin doing it again, as soon as we take care of the money mess we have made.
So our thought was this: Suppose we enlisted the help of others who would like to donate to charity? The money they would give would actually accomplish two things: 1) Help our family (including our 3 year old) out of debt and back onto a budget which we pledge to keep. We could then avoid bankruptcy. 2) Help community organizations once we are out and able to work it back into our budget. I know it sounds farfetched, and takes a good deal of faith, but right now, that is all we have.
A plea and a pledge
Hello
My name is Will, and I am currently $63,962 in debt.
Yes, you read that right. $63,962.
And believe it or not, this does not include my car payments or my mortgage, all of which are secured debts, and in many cases considered "good debt". No, sadly, this is bad debt, mostly from credit cards, and partly from a debt consolidation loan that I took out.
Why, you ask, am I this far in debt? I hope to answer this question for myself as well as for the universe, which is partly why I am starting this blog today. What I will say first of all that, yes, it is my fault and my doing. I want to own it and deal with it.
In all, I have three goals for this blog.
1) To help myself to come to grips with my financial demons, both by writing about it and maybe hearing comments of suggestion or support from others.
2) To chronicle my path out of debt (assuming I get there) so that it will be firmly implanted in my mind and I will never allow this to occur again.
3) To see if a little experiment will work. It starts with a plea, and ends with a pledge: First, to see if other people who have been through some of what I have been through would help me get out of debt, and second, my pledge to match any contributions to my debt relief effort and give that money to charity afterward.
Let me repeat that: If people were to help me get out of debt, I would, and I PROMISE, keep track of it, use it to pay off the high interest that I owe, and then later use my budgeted income to give it back to charity.
This type of statement clearly needs some background and detail, but there it is. My little experiment. If you are completely turned off by now I understand. If not, please read further. There is a story behind the mess.
My name is Will, and I am currently $63,962 in debt.
Yes, you read that right. $63,962.
And believe it or not, this does not include my car payments or my mortgage, all of which are secured debts, and in many cases considered "good debt". No, sadly, this is bad debt, mostly from credit cards, and partly from a debt consolidation loan that I took out.
Why, you ask, am I this far in debt? I hope to answer this question for myself as well as for the universe, which is partly why I am starting this blog today. What I will say first of all that, yes, it is my fault and my doing. I want to own it and deal with it.
In all, I have three goals for this blog.
1) To help myself to come to grips with my financial demons, both by writing about it and maybe hearing comments of suggestion or support from others.
2) To chronicle my path out of debt (assuming I get there) so that it will be firmly implanted in my mind and I will never allow this to occur again.
3) To see if a little experiment will work. It starts with a plea, and ends with a pledge: First, to see if other people who have been through some of what I have been through would help me get out of debt, and second, my pledge to match any contributions to my debt relief effort and give that money to charity afterward.
Let me repeat that: If people were to help me get out of debt, I would, and I PROMISE, keep track of it, use it to pay off the high interest that I owe, and then later use my budgeted income to give it back to charity.
This type of statement clearly needs some background and detail, but there it is. My little experiment. If you are completely turned off by now I understand. If not, please read further. There is a story behind the mess.
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