Author Topic: Case Study: Getting Divorced and Splitting a Mountain of Consumer Debt  (Read 12314 times)

ItsGettinReal

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Hey there kids, long time lurker, first time caller.

Here's the nitty gritty- my husband and I are calling it quits- we separate into our own apartments with separate finances in September. We have a young child.

I grew up in a very minimalist household and want to go back to it, especially to clear what will be my enormous portion of the debt. My soon to be ex equates things with love, and I don't enjoy being the mom to him so I enabled him. So, I'm leaving the marriage with a healthy salary, a beautiful daughter, but a heaping pile of debt. I want freedom- and fast.

Now, I am a spreadsheet wizard. I love this shit. This is what I have come up with for my budget and responsibilities post-separation. Keep in mind that the mediator may change things (he makes 20k more than me and I think that some things will need to be more proportional, since we're effectively splitting the debt evenly since we're just trying to keep what's already just in our own names. He's still my best friend, and I'm not out to make his life miserable.

Notes-

I live in the Midwest and we both plan on moving closer to my work since he works at home- I will then have about a 10 minute commute which in all possible weather I will ride my bike instead of driving on the weeks I don't have my daughter. On weeks I have my daughter I will need to drive her to school, back to work, back to school, and then home. Probably 20 miles total per day.

I basically have no assets. I have 5k in partially vested company stock and will have about 3k left after moving come September.

This is my estimated budget including income-

GROSS INCOME: $65,000
TAXES (TOTAL YEARLY): $14,506 (currently set at married 0- will have to change come january)
Health/vision/LTD/life ins/STD yearly cost: $2,179.68

Received 6k bonus this past February but wouldn't count on it again.

Current Net Income per month: $4,026

Est Budget-

gas/tolls           $60
Credit Cards     $734 for min payments- see breakdown below
hulu             $12
Electric             $40 (will make as low as possible)
Gas              $20
AES SL         $208 (Private @9% with 19k remaining. Ugh)
Car              $251 (Drive old call into ground after 11 years, purchased used 2015 last April for $14,460)
Verizon       $87 (Iphone- my portion-almost done paying device cost and then will go down to 55 but need to have a smartphone for work)
Car/Rent Ins   $80
Water           $20
Grocery   ?
Pet Ins             $28.62 (tentatively agreed to maintain insurance on the dogs and ex would take them full time so that I don't have to pay pet rent- will work out in mediation)
Internet            $40 or cheapest I can get- need for work
Daycare            $245 (my portion- before and after school care- necessary)

Rent   - Cheapest thing I can find in my area is approx $1250 but not locked down yet


   
This leaves me with approximately $951 for groceries/necessities/extra payments. I'm willing to go ultra minimalist on this stuff but I'm still learning how.



Credit card breakdown: (Min payment/total balance)

disc           70      2944
Target   27   470
GM       52   1899
Citi           88   3211
Elan 2   104   4900
SW           111   4891
Sapp   114   4946
PNC           168   7000
      
           734   30243

Yea, this really is just half of what we racked up. We've been idiots in a HCOL area for 15 years.

It's a possibility being discussed that my father will provide me with a reasonable rate private loan to pay off approx $20k of the credit card debt and I'd pay him back at a 5% rate instead of the 18% average that I have now. It would help me immensely but I can't rely on it.

Please facepunch me? Or give ideas? I can't find much more that I can feasibly cut.

(sorry for shitty formatting, I promise the numbers all line up in the post-writing box)
« Last Edit: May 16, 2017, 06:49:16 PM by ItsGettinReal »

RFAAOATB

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Could you live with your ex as room mates instead of spouses?  You both could cut costs this way and any new debt is now his problem.

MrsWolfeRN

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Could you sell some of your things and knock out the smaller debts before you separate?

Another Reader

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Can you qualify for balance transfers on one or more credit cards at 0 percent?

ItsGettinReal

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Could you live with your ex as room mates instead of spouses?  You both could cut costs this way and any new debt is now his problem.

No. I suggested this at first and he's not agreeable to it. And frankly, He refuses to cut anything (he'll learn.....) so I don't think it would help much.

However, I did forget to mention that by already seperating our finances as of now, I'll have about $4500 in cash when I move out in September. It'll have to pay for deposits, etc, but I'll at least have a savings safety net.

Could you sell some of your things and knock out the smaller debts before you separate?

Most of the stuff worth selling is "his" (electronics)and he will not sell anything. The upside to all this materialism, however, is that I will basically have to buy nothing but a kids bed for my new house- I'm not kidding- we have enough in one household for two households plus more, otherwise I'm donating a ton of stupid shit and selling anything worth anything at a garage sale this summer.

 
Can you qualify for balance transfers on one or more credit cards at 0 percent?

I doubt it. My credit utilization is super high and although the rest of my credit is excellent (no lates, collections, ect) the debt is dragging me down to the 680's according to MyFico. My best hope is the private consolidation loan from my Dad, but he's still mulling it over.

Cassie

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I wish you the best of luck in starting over. It sounds like you have a great mindset:))

MrsWolfeRN

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If he wants to keep his stuff then he should keep the debt that goes with it. It is only fair. Also why should you pay for insurance on a dog that he is keeping, especially if his income is higher?

ItsGettinReal

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Is feeding a single female plus a 6 year old girl (healthily) feasible on 300 bucks a month (I'll only have her half the time)? I've spend so long just not caring because he'd spend the rest of the money anyway that we currently spend a STUPID amount on food/eating out. I am willing to completely cut out dining out and eat practically vegetarian if it gets me out of debt faster.

I'd love to be able to take a part time job on the weeks that I won't have my child, but I have no idea how that would be feasible since I already work full time and I'd only be able to work every other week. Any ideas on additional non-traditional income?


ItsGettinReal

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If he wants to keep his stuff then he should keep the debt that goes with it. It is only fair. Also why should you pay for insurance on a dog that he is keeping, especially if his income is higher?

I disagree with this as well, and he's also wanting me to still be liable for half of the vet/food bills for the dogs. Right now I'm leaving that for the mediator to work out in a few weeks because I'm pretty sure she'll take my side and I just can't face the argument right now.

Also, on the debt, I agree, but from what I've heard so far, the debt should be split proportionally based on income because all purchases were made as a married couple, technically.
« Last Edit: May 16, 2017, 06:27:57 PM by ItsGettinReal »

Another Reader

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Are all of the cards in one name or the other?  Do you have any credit accounts with both names on them?  If so, have you cancelled them or removed your name from the accounts so no more debt can accrue in your name?  No point in making things worse.

lhamo

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Sorry you are going through this but it does sound like you will be better off (financially and emotionally) once you are on your own.

Do you really need hulu?   Here the library system gives free access to DVDs, and also some downloads (haven't tried this myself, though).

You can definitely get cheaper mobile plans.   I use google fi, which won't work with an iphone, but there are other options.  Check out IP Daley's mobile phone service guide.

Can you get him to let you claim your DD as a dependent for tax purposes?  That +head of household status will get you a much better tax rate.  If your STBX is not so savvy with financial matters he might not fight you on this.
Wherever you go, there you are

Lady SA

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It should be feasible to feed you and your daughter with $300/mo.

My husband and I are two adults and we spend $400-450/mo on groceries. With just one adult and a part-time daughter, $300 is more than reasonable.

That leaves you with ~$600 left over in your budget for extra payments.

What are the interest rates on all the cards? I'd personally knock out the target card first because its so small just to get rid of one bill, then do the avalanche method on the rest. If your dad can do a consolidation loan, even for a portion of your debt, that would help immensely.

Is there a reason your dad is waffling? He may be leery because of your past monetary issues (stemming from your exDH's habits, but that might not be clear to him), or is he financially insecure himself? If the former, presenting him with an action plan of how you are going forward responsibly and have a plan for paying your portion of the debts (and making it clear to your dad that it was exDH's spending, not you, that got you into so much debt) might make him more receptive. He might be nervous that you'll just go out and get into more debt and he would have to bail you out again. Show him that you've got your shit under control and have a clear plan and budget may help him relax. A nice step toward that could be eliminating one of your bills altogether (the target one) to show him you're serious.

That is a very generous offer by your dad and is for sure your best financial bet if he agrees to it. You could also talk to him about your backup plan if he decides not to and show him how you will be tackling the existing debt without the consolidation loan. Showing him that you've thought this through and have your eye on the ball may convince him that you are a "safe bet".
« Last Edit: May 16, 2017, 08:00:22 PM by LadyLB »
https://www.earnest.com/invite/lillian2 --> Use this referral to refinance your student loans with Earnest and get a $200 bonus!

ItsGettinReal

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Are all of the cards in one name or the other?  Do you have any credit accounts with both names on them?  If so, have you cancelled them or removed your name from the accounts so no more debt can accrue in your name?  No point in making things worse.

I took care of this earlier this week. There were no truly joint cards- we were just auth users on a couple of each others. I've separated them. What you see in my breakdown is all in my name (I had the good credit for a while....)


Sorry you are going through this but it does sound like you will be better off (financially and emotionally) once you are on your own.

Do you really need hulu?   Here the library system gives free access to DVDs, and also some downloads (haven't tried this myself, though). -- we have a tentative agreement that he'll pay for netflix and I'll pay for hulu and we'll still share the accounts. Ya ya I know, but it also gives me a plethora of entertainment and a ton of kids shows for $12. Our library is meh....

You can definitely get cheaper mobile plans.   I use google fi, which won't work with an iphone, but there are other options.  Check out IP Daley's mobile phone service guide. -- Definitely going to look into this. I maybe use 15% of the functionality of my phone, but I have to be able to connect outlook for work, for example.

Can you get him to let you claim your DD as a dependent for tax purposes?  That +head of household status will get you a much better tax rate.  If your STBX is not so savvy with financial matters he might not fight you on this.

Our mutual friends that just went through a divorce warned us about the tax implications of claiming her and HOH, so he's not going to give up alternating years of that without a fight.


ItsGettinReal

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It should be feasible to feed you and your daughter with $300/mo.

My husband and I are two adults and we spend $400-450/mo on groceries. With just one adult and a part-time daughter, $300 is more than reasonable.

That leaves you with ~$600 left over in your budget for extra payments.

What are the interest rates on all the cards? I'd personally knock out the target card first because its so small just to get rid of one bill, then do the avalanche method on the rest. If your dad can do a consolidation loan, even for a portion of your debt, that would help immensely.

Is there a reason your dad is waffling? He may be leery because of your past monetary issues (stemming from your exDH's habits, but that might not be clear to him), or is he financially insecure himself? If the former, presenting him with an action plan of how you are going forward responsibly and have a plan for paying your portion of the debts (and making it clear to your dad that it was exDH's spending, not you, that got you into so much debt) might make him more receptive. He might be nervous that you'll just go out and get into more debt and he would have to bail you out again. Show him that you've got your shit under control and have a clear plan and budget may help him relax. A nice step toward that could be eliminating one of your bills altogether (the target one) to show him you're serious.

That is a very generous offer by your dad and is for sure your best financial bet if he agrees to it. You could also talk to him about your backup plan if he decides not to and show him how you will be tackling the existing debt without the consolidation loan. Showing him that you've thought this through and have your eye on the ball may convince him that you are a "safe bet".

Thank you. I'm really good at couponing and meal planning when I actually try too, so I think I can get food costs down to very very low levels. I'm looking at it as a challenge :)

As for my Dad, he's in a position to do it, he's actually an original MMM'er really, he retired at 48 and now just fixes bikes part time for enjoyment and a living. Saved all his life and collects a great pension. I wish I would have paid more attention to him but we went through losing my mom to cancer when I was a teen and I just went way off my intended path....He's bailed me out as an early 20something many times. But not in about 10 years. I think he will do a loan for at least a good portion of the amount. I've offered 5% interest with a formal contract and amortization schedule with a very aggressive loan term, and even sent a copy of my MyFico report to him. I think he knows I would never stiff him, but he also has to get my stepmother to buy in.

Indio

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If you need internet service for work, can you expense it? If not, maybe you share expense with neighbor?

When I divorced, I cut everything to the bone. Got rid of cable so kids became great readers. Not having a TV babysitter, had a great side effect. We still don't have netflix, hulu, cable and kids play online math games to entertain themselves.

Verdure

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In think $300 a month should be totally doable. That is my grocery budget for 2 adults. We live in a fairly lcol large Midwestern city. I am a vegetarian, MrV is not. I don't really bother with coupons or much shopping around. I buy mostly organics, not much processed foods.  I'm pretty good about meal planning. I usually spend about $100 a month at Costco, and then about $50 a week at Trader Joes, with occasional stops at other grocery stores for random stuff I can't get at those 2 places. When I do that, I reduce my spending at Costco or TJs to compensate.

Larsg

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Any chance at considering raising your salary by looking for a better job. i don't recall if I have posted on this topic before but throughout my career, I gained significant advantage over my peers by being willing to relocate with both current firm as well as always looked for opportunities in good locations that I would be willing to live. This brought me from the West Coast, to the East Coast, Mid West (Chicago) and finally now in the Pacific North West. Each move came with a salary boost, paid move through corporate Cendant Mobility, and a singing bonus every time between 10K (Lowest) and 30K, Highest. Not sure what you do but before counting yourself out, explore on linkedin jobs in your area of interest in cities you would be willing to live. I first began as a single person, then with a DW, then 2 kids. We have settled down but we did get this process nailed down, timed for the start of school, etc. It is a way out, a way to explore, learn, grow big time, and experience different locations. Not sure how custody would work in that scenario. Even exploring across Chicago for a higher salary can yield a signing bonus, added perks, etc. I loved what i did before I began this journey across the country and back but I have always been driven to be fiscally accountable and knew that I would never truly get ahead until I simply went for more. I never listened to any of my friends or family that said "you can't do that, you will never find a better job that pays more than...or you can't jump from Finance, to Marketing," and so on. You can find a way out if you set your mind to it but I would say with debt like this, time is of the essence because of your interest rates. I would also try and stand alone vs borrowing from your dad. It's just better that way in the long run - you telling you that you are serious. Also, you may need to examine how you got into such debt int he first place. It's easy to slide back under stress or other circumstances w/out understanding root cause. Best of Luck.

ItsGettinReal

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Any chance at considering raising your salary by looking for a better job. i don't recall if I have posted on this topic before but throughout my career, I gained significant advantage over my peers by being willing to relocate with both current firm as well as always looked for opportunities in good locations that I would be willing to live. This brought me from the West Coast, to the East Coast, Mid West (Chicago) and finally now in the Pacific North West. Each move came with a salary boost, paid move through corporate Cendant Mobility, and a singing bonus every time between 10K (Lowest) and 30K, Highest. Not sure what you do but before counting yourself out, explore on linkedin jobs in your area of interest in cities you would be willing to live. I first began as a single person, then with a DW, then 2 kids. We have settled down but we did get this process nailed down, timed for the start of school, etc. It is a way out, a way to explore, learn, grow big time, and experience different locations. Not sure how custody would work in that scenario. Even exploring across Chicago for a higher salary can yield a signing bonus, added perks, etc. I loved what i did before I began this journey across the country and back but I have always been driven to be fiscally accountable and knew that I would never truly get ahead until I simply went for more. I never listened to any of my friends or family that said "you can't do that, you will never find a better job that pays more than...or you can't jump from Finance, to Marketing," and so on. You can find a way out if you set your mind to it but I would say with debt like this, time is of the essence because of your interest rates. I would also try and stand alone vs borrowing from your dad. It's just better that way in the long run - you telling you that you are serious. Also, you may need to examine how you got into such debt int he first place. It's easy to slide back under stress or other circumstances w/out understanding root cause. Best of Luck.

I have considered looking for a new job several times, but there are a few things holding me back from truly pursuing it. Feel free to facepunch me on this--

1. I've been with the company for 11 years and now receive stock yearly and over a month of vacation time annually. I genuinly enjoy my job and the people that I work with as well. The stability that I have is pretty rock solid in my particular position and that gives me a lot of comfort.

2. I do get steady raises and last year was my first real bonus- while I will not allow myself to expect another one, there is a good chance of it being a yearly thing from now on.

3. I actually transferred a few years ago to the suburban office from our downtown office (CHicago), so right now the COL is on the low end of Chicagoland. With 50/50 custody I can't leave the state, and leaving the Chicagoland area for a different job will probably not be feasible.

Regarding the debt, I have been in therapy for a while and I understand pretty well how this happened. I'm a doormat and I couldn't stand up for myself and our budget because I wanted to avoid conflict with my husband at all costs. The stuff and the materialism and the overconsumption actually caused me to be constantly depressed for a really long time. Like I said, I grew up in a very zen, minimalist household and I just don't understand the need for fancy stuff. I'd rather travel if I'm going to spend money. I already buy almost all my clothing at Goodwill because I don't like perpetuating the disposable clothing cycle. Frankly, I think that the transition back to my roots is going to make me really happy and fulfilled.

Dee18

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Not sure from your post what your parenting schedule is, but can you set it from Sunday night to Sunday night  and furnish your apartment so that you could Airbnb your child's room every other weekend?  Alternatively, while I know it would not be ideal in many ways, could you house share for a year or two?  Rent an efficiency for less?  If you are willing to be non-traditional for a couple years, you could really make a dent in your debt.  Otherwise, I think your idea of working a part time job every other week is a good one.  Many employers would be happy to hire someone who has such a strong employment record. Make sure that you are not overspending on your daughter out of some perceived social pressure; she doesn't need new clothes either until your debt is greatly reduced.   

ItsGettinReal

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Not sure from your post what your parenting schedule is, but can you set it from Sunday night to Sunday night  and furnish your apartment so that you could Airbnb your child's room every other weekend?  Alternatively, while I know it would not be ideal in many ways, could you house share for a year or two?  Rent an efficiency for less?  If you are willing to be non-traditional for a couple years, you could really make a dent in your debt.  Otherwise, I think your idea of working a part time job every other week is a good one.  Many employers would be happy to hire someone who has such a strong employment record. Make sure that you are not overspending on your daughter out of some perceived social pressure; she doesn't need new clothes either until your debt is greatly reduced.

It does look like it will be sunday-sunday yes. I've actually considered the Airbnb thing, but going a little farther with it. I have friends that would let me stay overnight by myself pretty much any time, so I'm thinking about ABNBing my entire place out to be available anytime during the weeks that I'm not home. I would probably give them a cut of the profit for letting me crash in their spare bedroom when this happens.

I've looked for the cheapest places possible that are still appropriate for joint custody- I think the lowest I'm going to be able to *possibly* find is $1150/month. I already buy most of my daughters items second hand, and she does not get random gifts or things aside from birthdays and holidays for the most part- this is where I've refused to be a doormat- I will not have my daughter equating things with love. We do a lot of free stuff and nature walks, etc instead.

gatortator

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Create a visual aid to represent your debt.  Fill in/remove (depending on how you make the art) pieces as you pay off the debt.  May help at times when your motivation needs a boost.  You can do it!

Fill in example (don't buy just make your own):

http://mapyourprogress.com/how-it-works

Remove examples:

Paper Chain
Paper Clip Chain

ItsGettinReal

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Create a visual aid to represent your debt.  Fill in/remove (depending on how you make the art) pieces as you pay off the debt.  May help at times when your motivation needs a boost.  You can do it!

Fill in example (don't buy just make your own):

http://mapyourprogress.com/how-it-works

Remove examples:

Paper Chain
Paper Clip Chain

Supercool! This is so up my alley! Thanks!

PDXTabs

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I would seriously consider filing chapter 7 bankruptcy if at all possible. I have never filed for bankruptcy, and I don't know if you qualify in your state with your income. To my knowledge you need to be at or below the median income for a family of your size. Depending on your state you may squeak by if you get to count your daughter: https://www.justice.gov/ust/eo/bapcpa/20170501/bci_data/median_income_table.htm

snacky

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For the first three years after I left my ex I shared a bedroom with my kids. I eventually got a bigger place and gave them their own rooms,but I saved a lot of money in those years.
FrugalParagon and Chippewa are both currently living in their living rooms while their kids get the bedroom.
Is a smaller place an option for you?
Enjoy what comes
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Stomp on the hearts of the unworthy

monstermonster

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You sound motivated and like you can seriously kick some ass with the right approach. You seem to have a good attitude considering all the debt. Sorry this is happening, none of this sounds fun.

$300 is MORE than enough to feed an adult + part-time daughter. We feed a 2 HCOL area yuppies on that amount of money, and we shop mostly at Whole Foods (though we try not to go crazy). We are vegetarian, though. Meal planning is the key and not eating out.

I don't normally recommend Dave Ramsey, but if you can stand the preaching (he's Christian and caters to Christians) he has a VERY strong anti-debt message and a lot of support of people working to pay off big mounds of consumer debt like you. There's a lot of inspirational youtube videos of people finishing off their debt.

You can totally do it! Have you set yourself up on undebt.it? It's a great way to play with repayment timelines.

Moonwaves

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A friend of mine divorced last year and just recently started AirBnBing her place when her son is not there. She stays with a friend when she does that. As she lives in a town with a very high level of trade fairs, she can figure out easily enough when high demand will be and plan accordingly. Her son is mid-teens but since the Ex stayed in the former family home, he basically just kept his room there and comes to sleep in her place on her custody days. But even nearly a year later, it still feels like it's not his room. A big part of that is because of his age and his attitude but it's possibly something to keep in mind if you decide to AirBnB. Will you be still able to make it a home for you and your daughter, or will you be constantly trying to keep it so neutral that it doesn't have a chance to become a home. 

I'd recommend reading Frugalparagon's journals as she has come through a similar experience over the last fifteen months or so, albeit with an ex that sounds a bit more challenging than yours.

JustGettingStarted1980

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Consider House Sharing?

Find another soon-to-be Single Mother with 1 child (there are plenty of websites), and rent a 2-3 bedroom for $1800/month, and share all utilities and expenses not including food.  This has added benefit of another set of eyes and ears for your child at home, help with sick kids, pick up and drop off, etc....  Of course, it would all depend on finding the RIGHT person, and I would do a comprehensive background check on the individual. Any Chicago area single mother's here on MMM Forum?

Good luck,

JGS

ItsGettinReal

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For the first three years after I left my ex I shared a bedroom with my kids. I eventually got a bigger place and gave them their own rooms,but I saved a lot of money in those years.
FrugalParagon and Chippewa are both currently living in their living rooms while their kids get the bedroom.
Is a smaller place an option for you?

If a one bedroom is allowed, I'm doing it. Everyone keeps telling me I have to have an actual bedroom for her. Hell, I'd sleep on the couch while she's there to save money.

ItsGettinReal

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I would seriously consider filing chapter 7 bankruptcy if at all possible. I have never filed for bankruptcy, and I don't know if you qualify in your state with your income. To my knowledge you need to be at or below the median income for a family of your size. Depending on your state you may squeak by if you get to count your daughter: https://www.justice.gov/ust/eo/bapcpa/20170501/bci_data/median_income_table.htm

I want to explore all possible options before going the nuclear route, because I do have pretty good credit minus the debt right now, and I do believe that I can get this wiped out.

ItsGettinReal

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You sound motivated and like you can seriously kick some ass with the right approach. You seem to have a good attitude considering all the debt. Sorry this is happening, none of this sounds fun.

$300 is MORE than enough to feed an adult + part-time daughter. We feed a 2 HCOL area yuppies on that amount of money, and we shop mostly at Whole Foods (though we try not to go crazy). We are vegetarian, though. Meal planning is the key and not eating out.

I don't normally recommend Dave Ramsey, but if you can stand the preaching (he's Christian and caters to Christians) he has a VERY strong anti-debt message and a lot of support of people working to pay off big mounds of consumer debt like you. There's a lot of inspirational youtube videos of people finishing off their debt.

You can totally do it! Have you set yourself up on undebt.it? It's a great way to play with repayment timelines.

Thank you! I've actually been vegetarian before and may either go completely back or at least partially to save money. I've dabbled in Dave but I'm a staunch Athiest and the religious stuff just turns me right off. I'm much more of a MMM gal lol.

Had not heard of undebtit but I'm plugging in numbers now!

A friend of mine divorced last year and just recently started AirBnBing her place when her son is not there. She stays with a friend when she does that. As she lives in a town with a very high level of trade fairs, she can figure out easily enough when high demand will be and plan accordingly. Her son is mid-teens but since the Ex stayed in the former family home, he basically just kept his room there and comes to sleep in her place on her custody days. But even nearly a year later, it still feels like it's not his room. A big part of that is because of his age and his attitude but it's possibly something to keep in mind if you decide to AirBnB. Will you be still able to make it a home for you and your daughter, or will you be constantly trying to keep it so neutral that it doesn't have a chance to become a home. 

I'd recommend reading Frugalparagon's journals as she has come through a similar experience over the last fifteen months or so, albeit with an ex that sounds a bit more challenging than yours.

Really good things to consider here. I'm also looking into the house sharing thing but I admit that I'm an extreme introvert and it makes me wary. But- debt, so I will look into it!

monstermonster

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Thank you! I've actually been vegetarian before and may either go completely back or at least partially to save money. I've dabbled in Dave but I'm a staunch Athiest and the religious stuff just turns me right off. I'm much more of a MMM gal lol.
Yea, I totally get that. Also an Atheist and the main reason I started my business (also teaching personal finance on the radio and through courses) is that I was frustrated how few alternatives for attacking debt that weren't super-duper Christian (and pretty sexist.)

ItsGettinReal

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Thank you! I've actually been vegetarian before and may either go completely back or at least partially to save money. I've dabbled in Dave but I'm a staunch Athiest and the religious stuff just turns me right off. I'm much more of a MMM gal lol.
Yea, I totally get that. Also an Atheist and the main reason I started my business (also teaching personal finance on the radio and through courses) is that I was frustrated how few alternatives for attacking debt that weren't super-duper Christian (and pretty sexist.)

I appreciate you! LMAO

Kansas Terri

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Some inspirational stuff: do you remember the TV show "The Peoples Court"? On it a gent was suing his ex, wanting her to take over some of the marital debts. The Divorce court had split the debts and she had paid her's off but he had not, so he wanted her to take on more of them.

Judge Judy replied that the case had already been settled in Divorce Court.

He said "But, your honor, look at her HANDS"! And the camera showed she had a few gold rings on, some of which had diamonds.

Judge Judy said "Did you pay cash for those"?

"Yes"

"Buy more of them, if you like them" was her response.

On a more practical note, do you have an Aldi's in your area? I go every couple of weeks, and when I do it cuts my grocery bill by 1/3. Their selection isn't all that great, but I can buy 2 weeks worth of staples like noodles and cereal for much less. I buy things that Aldi's does not have (like dried apricots) at a different store.

Some easy meals for a busy Mom: Brown a pound of hamburger and add a jar of spaghetti sauce. Serve over either spaghetti or noodles. Aldi's has good mac n cheese for 33 cents a box if your daughter finds the smaller noodles easier to eat. Cost is about $8?, though your probably will have enough meat and sauce for a second meal.

Roast. Put a frozen chunk of meat in the oven and set the timer. The meat will thaw slowly during the day and then the oven will kick on. Eat it as roast the first night with microwaved potatos, and then slice it for a few days sandwiches.

Bear Creek soup. This is a dried soup that I keep around for blizzards and such. Open the bag, boil the contents for a little longer than the directions call for, and add a can of meat. Cost is about $7?

Leftovers. Put them on a pizza crust with spaghetti sauce, (I add fennel to it to make it taste just like pizza) add chopped up leftovers and top with a fistful of cheese. Leftovers can give you a free meal.

ItsGettinReal

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Some inspirational stuff: do you remember the TV show "The Peoples Court"? On it a gent was suing his ex, wanting her to take over some of the marital debts. The Divorce court had split the debts and she had paid her's off but he had not, so he wanted her to take on more of them.

Judge Judy replied that the case had already been settled in Divorce Court.

He said "But, your honor, look at her HANDS"! And the camera showed she had a few gold rings on, some of which had diamonds.

Judge Judy said "Did you pay cash for those"?

"Yes"

"Buy more of them, if you like them" was her response.

On a more practical note, do you have an Aldi's in your area? I go every couple of weeks, and when I do it cuts my grocery bill by 1/3. Their selection isn't all that great, but I can buy 2 weeks worth of staples like noodles and cereal for much less. I buy things that Aldi's does not have (like dried apricots) at a different store.

Some easy meals for a busy Mom: Brown a pound of hamburger and add a jar of spaghetti sauce. Serve over either spaghetti or noodles. Aldi's has good mac n cheese for 33 cents a box if your daughter finds the smaller noodles easier to eat. Cost is about $8?, though your probably will have enough meat and sauce for a second meal.

Roast. Put a frozen chunk of meat in the oven and set the timer. The meat will thaw slowly during the day and then the oven will kick on. Eat it as roast the first night with microwaved potatos, and then slice it for a few days sandwiches.

Bear Creek soup. This is a dried soup that I keep around for blizzards and such. Open the bag, boil the contents for a little longer than the directions call for, and add a can of meat. Cost is about $7?

Leftovers. Put them on a pizza crust with spaghetti sauce, (I add fennel to it to make it taste just like pizza) add chopped up leftovers and top with a fistful of cheese. Leftovers can give you a free meal.

That story is amazing. I love judge Judy!

Oh yea, I definitely do have an aldi and I also have a GFS supermarket type store right next to my work. I think I can get staples VERY cheaply between the two! I love leftovers too, so I can easily eat spaghetti for 3 days straight.

Chippewa

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For the first three years after I left my ex I shared a bedroom with my kids. I eventually got a bigger place and gave them their own rooms,but I saved a lot of money in those years.
FrugalParagon and Chippewa are both currently living in their living rooms while their kids get the bedroom.
Is a smaller place an option for you?

If a one bedroom is allowed, I'm doing it. Everyone keeps telling me I have to have an actual bedroom for her. Hell, I'd sleep on the couch while she's there to save money.

If you child was male, then lawfully you would need a separate room (as my understanding, at least in CAliforNia). I do not think you would need so for your daughter. You could share a room from what I know. Since she is young, you are at prime to hone down in a 1b and pay that debt off. 
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Inaya

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Whole Foods' bulk section is often cheaper even than Aldi for bulk staples (beans, oatmeal, etc.). Some spices, as well. It's also great if you want to experiment with spices but not commit to a whole jar--buy just enough for a meal. However, always check your most convenient ethnic market because you can often get spices even more inexpensively there.

BudgetBytes.com is my goto for cheap, easy recipes. But here's a link with a couple more: http://www.huffingtonpost.com/2014/11/11/budget-food-blogs_n_6135100.html

If you don't have an InstantPot, consider getting one. They're pricey, but absolutely worth it. One of the best purchases I've made in my life.

Good luck!
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ItsGettinReal

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For the first three years after I left my ex I shared a bedroom with my kids. I eventually got a bigger place and gave them their own rooms,but I saved a lot of money in those years.
FrugalParagon and Chippewa are both currently living in their living rooms while their kids get the bedroom.
Is a smaller place an option for you?

If a one bedroom is allowed, I'm doing it. Everyone keeps telling me I have to have an actual bedroom for her. Hell, I'd sleep on the couch while she's there to save money.

If you child was male, then lawfully you would need a separate room (as my understanding, at least in CAliforNia). I do not think you would need so for your daughter. You could share a room from what I know. Since she is young, you are at prime to hone down in a 1b and pay that debt off.

If I can do this, it's absolutely happening. It would give me an extra $200 per month easy to throw at debt.

I just plugged all the CC debt into Undebtit- FASCINATING! If I have to stick to the original interest rates (IE: no loan from Dad), I can still get all the CC debt paid off by 6/2019. This doesn't even count potential bonuses or raises.

When I add in my student loans and car loan, it brings the payoff date to 7/2020. Which is three years away but that's only THREE years at the absolute longest for freedom from debt. This is so hugely motivating to me right now.
« Last Edit: May 18, 2017, 12:56:24 PM by ItsGettinReal »

ItsGettinReal

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Whole Foods' bulk section is often cheaper even than Aldi for bulk staples (beans, oatmeal, etc.). Some spices, as well. It's also great if you want to experiment with spices but not commit to a whole jar--buy just enough for a meal. However, always check your most convenient ethnic market because you can often get spices even more inexpensively there.

BudgetBytes.com is my goto for cheap, easy recipes. But here's a link with a couple more: http://www.huffingtonpost.com/2014/11/11/budget-food-blogs_n_6135100.html

If you don't have an InstantPot, consider getting one. They're pricey, but absolutely worth it. One of the best purchases I've made in my life.

Good luck!

Luckily I'm a good cook with an excellent spice collection coming with me- I can make cheap stuff taste amazing LOL.

Looking into instapot....might be a good birthday or christmas gift request from my Dad :)

RedwoodDreams

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Would you consider selling the 2015 car and buying a dependable used Honda or Toyota for about 5k? That would net you a cool 10k to put toward the debt reduction. What does the plan look like if it's paying down 20k instead of 30k?

It wouldn't have to be the last car you own, but could help accelerate you to the place you want to be, for now.

I own a fantastic used Acura 1998 with 145k miles on it, runs like a champ, never has any problems, perfectly reliable and doesn't look like a beater. Worth maybe 4-5k. It's possible to get something very reliable and presentable for 5k.

Just one option. Good luck. Sounds like you're certainly in the right mental state to blaze forward!

lhamo

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Google the Good and Cheap recipe book for more cheap meal ideas-- you can download a free pdf version.   It is geared toward people on SNAP, and the recipes I have tried I have really liked (the jalapeno cheddar scones are great with soup or chili)
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Rowellen

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If you child was male, then lawfully you would need a separate room (as my understanding, at least in CAliforNia). I do not think you would need so for your daughter. You could share a room from what I know. Since she is young, you are at prime to hone down in a 1b and pay that debt off.

Is that true? Why would the state care enough to dictate sleeping arrangements? Both my kids (DS 8 & DD 6) like to sleep in my bed.  They have their own but one or the other or sometimes both will end up in my bed most nights. I think my daughter would be thrilled if she could share a room with me every night.

SwordGuy

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If you child was male, then lawfully you would need a separate room (as my understanding, at least in CAliforNia). I do not think you would need so for your daughter. You could share a room from what I know. Since she is young, you are at prime to hone down in a 1b and pay that debt off.

Is that true? Why would the state care enough to dictate sleeping arrangements? Both my kids (DS 8 & DD 6) like to sleep in my bed.  They have their own but one or the other or sometimes both will end up in my bed most nights. I think my daughter would be thrilled if she could share a room with me every night.

Check your state, county and city laws.   I kid you not.  Know for sure.   

Get the answer in writing if you can.  Just because.    Especially if the ex might go for full custody later.

If you can get a roommate you'll really cut your costs down.

Another option is to contact the credit card companies after it's all finalized and tell them what's happened.  You might be able to negotiate a better rate or a lower balance - particularly if they are concerned you might go bankrupt.   They might also cut your available credit downwards, so I wouldn't contact them all at the same time...

tyort1

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I 2nd the instant pot rec - you can make yogurt in it.  Around here Fage greek yogurt goes for about $10/liter.  I can make yogurt in the instant pot, strain it and have 1 liter of yogurt for $2.  It also works well as a slow cooker in addition to it's pressure cooking abilities.
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economista

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The room thing is definitely set by the state and in Ohio at least they take it very seriously if one parent complains.  My parents divorced when I was little and I remember one point when my mom had custody of us my dad had a 1 bedroom apartment.  My brother and I were around 5 and 3 and my dad had bunk beds in the room.  He had 1 bunk and my brother and I shared the other one.  My mom reported him to social services and his visitation was removed until my brother and I had separate rooms to sleep in.  Boys and girls were not allowed to sleep in the same room.  He then retaliated against my mom a few years later when my 3 siblings and I were all in the same room (6 year old girl, two toddler boys, and infant girl).  In that case we were all sharing the same mattress on the floor (not the infant, though, obviously). 

I don't think you would have any issues at all if you were sleeping on a daybed in the living room in place of a couch like FP, or if you were sharing the room with your daughter since she is the same gender.  Also, I think it is only an issue if someone lodges a formal complaint.
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ItsGettinReal

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Would you consider selling the 2015 car and buying a dependable used Honda or Toyota for about 5k? That would net you a cool 10k to put toward the debt reduction. What does the plan look like if it's paying down 20k instead of 30k?

It wouldn't have to be the last car you own, but could help accelerate you to the place you want to be, for now.

I own a fantastic used Acura 1998 with 145k miles on it, runs like a champ, never has any problems, perfectly reliable and doesn't look like a beater. Worth maybe 4-5k. It's possible to get something very reliable and presentable for 5k.

Just one option. Good luck. Sounds like you're certainly in the right mental state to blaze forward!

Part of the reason I bought the used Sonic specifically, is because my father also owns one and built cars for GM for 35 years. If anything goes wrong with this, he can and will help me fix it to avoid repair bills. He also helps with general maintenance. If I go with a foreign car, this help goes out the window because the systems are unfamiliar to him. It seems like the foreign ones are always the cars that people recommend buying a used cheapie on...

kelvin

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Part of the reason I bought the used Sonic specifically, is because my father also owns one and built cars for GM for 35 years. If anything goes wrong with this, he can and will help me fix it to avoid repair bills. He also helps with general maintenance. If I go with a foreign car, this help goes out the window because the systems are unfamiliar to him. It seems like the foreign ones are always the cars that people recommend buying a used cheapie on...

Your dad (or you + youtube) would be easily able to fix a Honda/Toyota. The cars and their parts last years longer than anything else in the same price range, they're easy to work on, and the parts are cheap. They're a backyard mechanic's dream, it's why everyone on the forum loves them.

PDXTabs

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I want to explore all possible options before going the nuclear route, because I do have pretty good credit minus the debt right now, and I do believe that I can get this wiped out.

You can do whatever you want, but please do not pay a bunch of interest (plus principal) because of social pressure not to file for bankruptcy. How many thousands of dollars is your credit worth to you? You should decide through some objective measure and then figure out how much money you could save through bankruptcy.

EDIT - Also, there are three "normal" times that people end up filing for bankruptcy:
  • Job loss
  • Illness (in the US)
  • Divorce

No one will think that you are a bad person if you file for bankruptcy in relation to your divorce.
« Last Edit: May 20, 2017, 10:48:40 AM by PDXTabs »

BrandNewPapa

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GROSS INCOME: $65,000
TAXES (TOTAL YEARLY): $14,506 (currently set at married 0- will have to change come january)
Health/vision/LTD/life ins/STD yearly cost: $2,179.68

Received 6k bonus this past February but wouldn't count on it again.

Current Net Income per month: $4,026

Est Budget-

gas/tolls           $60
Credit Cards     $734 for min payments- see breakdown below
hulu             $12
Electric             $40 (will make as low as possible)
Gas              $20
AES SL         $208 (Private @9% with 19k remaining. Ugh)
Car              $251 (Drive old call into ground after 11 years, purchased used 2015 last April for $14,460)
Verizon       $87 (Iphone- my portion-almost done paying device cost and then will go down to 55 but need to have a smartphone for work)
Car/Rent Ins   $80
Water           $20
Grocery   ?
Pet Ins             $28.62 (tentatively agreed to maintain insurance on the dogs and ex would take them full time so that I don't have to pay pet rent- will work out in mediation)
Internet            $40 or cheapest I can get- need for work
Daycare            $245 (my portion- before and after school care- necessary)

Rent   - Cheapest thing I can find in my area is approx $1250 but not locked down yet


   
This leaves me with approximately $951 for groceries/necessities/extra payments. I'm willing to go ultra minimalist on this stuff but I'm still learning how.



Credit card breakdown: (Min payment/total balance)

disc           70      2944
Target   27   470
GM       52   1899
Citi           88   3211
Elan 2   104   4900
SW           111   4891
Sapp   114   4946
PNC           168   7000
      
           734   30243

You have a great income and should be able to pay down your debt quickly. As a few have already mentioned, use the debt snowball method, it really works. I paid off 18k in debt at 11% in one year while making 55k/year.

I find it difficult to believe you can't find a 2 bedroom apartment in the midwest for less then $1250. I think you could find something cheaper. That is probably the biggest opportunity for expense reduction. Consider some other areas, check craigslist, negotiate with landlords, etc. Rentometer.com can be a good resource to make sure you are getting a good deal.

I would absolutely ditch the pet insurance unless they have serious conditions you need it for. There are always free/cheap vaccination clinic you can take your pets to in my area. That is all most pets really need. Much cheaper than paying $30/month.

Once your phone is paid off with Verizon, ditch them. They are scammers and rip you off. Take your phone to Google FI or Republic Wireless for $30/month. If it is required for work, as about expensing it. If you can't, make sure you deduct the appropriate portion at tax time (same for your home internet).

My bet? You can find a decent place to live for $1000/month, save $20/month on phone service, save $30/month on pet insurance if you really try and commit yourself.

That is an additional $300/month.

Chippewa

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Case Study: Getting Divorced and Splitting a Mountain of Consumer Debt
« Reply #48 on: May 22, 2017, 08:14:56 AM »
I moved my phone to VW prepaid. Cheaper ($40/m) than contract if u stay with them. No hassle. 2g but i barely use it as i have wifi all the time. Much happier with this plan then when i was tethered to their contract.
blog :: stupid debt.  And I have a journal, y'all just think I am going to delete it

ItsGettinReal

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GROSS INCOME: $65,000
TAXES (TOTAL YEARLY): $14,506 (currently set at married 0- will have to change come january)
Health/vision/LTD/life ins/STD yearly cost: $2,179.68

Received 6k bonus this past February but wouldn't count on it again.

Current Net Income per month: $4,026

Est Budget-

gas/tolls           $60
Credit Cards     $734 for min payments- see breakdown below
hulu             $12
Electric             $40 (will make as low as possible)
Gas              $20
AES SL         $208 (Private @9% with 19k remaining. Ugh)
Car              $251 (Drive old call into ground after 11 years, purchased used 2015 last April for $14,460)
Verizon       $87 (Iphone- my portion-almost done paying device cost and then will go down to 55 but need to have a smartphone for work)
Car/Rent Ins   $80
Water           $20
Grocery   ?
Pet Ins             $28.62 (tentatively agreed to maintain insurance on the dogs and ex would take them full time so that I don't have to pay pet rent- will work out in mediation)
Internet            $40 or cheapest I can get- need for work
Daycare            $245 (my portion- before and after school care- necessary)

Rent   - Cheapest thing I can find in my area is approx $1250 but not locked down yet


   
This leaves me with approximately $951 for groceries/necessities/extra payments. I'm willing to go ultra minimalist on this stuff but I'm still learning how.



Credit card breakdown: (Min payment/total balance)

disc           70      2944
Target   27   470
GM       52   1899
Citi           88   3211
Elan 2   104   4900
SW           111   4891
Sapp   114   4946
PNC           168   7000
      
           734   30243

You have a great income and should be able to pay down your debt quickly. As a few have already mentioned, use the debt snowball method, it really works. I paid off 18k in debt at 11% in one year while making 55k/year.

I find it difficult to believe you can't find a 2 bedroom apartment in the midwest for less then $1250. I think you could find something cheaper. That is probably the biggest opportunity for expense reduction. Consider some other areas, check craigslist, negotiate with landlords, etc. Rentometer.com can be a good resource to make sure you are getting a good deal.

I would absolutely ditch the pet insurance unless they have serious conditions you need it for. There are always free/cheap vaccination clinic you can take your pets to in my area. That is all most pets really need. Much cheaper than paying $30/month.

Once your phone is paid off with Verizon, ditch them. They are scammers and rip you off. Take your phone to Google FI or Republic Wireless for $30/month. If it is required for work, as about expensing it. If you can't, make sure you deduct the appropriate portion at tax time (same for your home internet).

My bet? You can find a decent place to live for $1000/month, save $20/month on phone service, save $30/month on pet insurance if you really try and commit yourself.

That is an additional $300/month.

This is Chicagoland, so I'm not kidding when I say the literal cheapest 2-bed that won't end up costing me more in commuting costs and is safe is exactly $1071 per month as of right now. I could find cheaper if I veered into the more shady areas, but I'd not be able to bike commute half the time like I'm planning and I'd not be doing a lot of biking/walking for errands.

Good info on the phone and I agree about the pet insurance, but that's a current area of contention between me and my STBX.....