Author Topic: Reader Case Study - $231k in debt and need help!  (Read 44845 times)

Novik

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Re: Reader Case Study - $231k in debt and need help!
« Reply #250 on: March 10, 2017, 12:04:13 PM »
I am unreasonably and excessively pleased about a complete stranger on the internet having two less debts to pay on every month.

Same.
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wintertell

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Re: Reader Case Study - $231k in debt and need help!
« Reply #251 on: March 10, 2017, 12:09:00 PM »
I am unreasonably and excessively pleased about a complete stranger on the internet having two less debts to pay on every month.

Same.

Make that three folks!!!!! Congratulations! Dash to the rescue, to rescue Dashh! ... OK now I'm just being silly. : )

Laura33

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Re: Reader Case Study - $231k in debt and need help!
« Reply #252 on: March 10, 2017, 12:29:15 PM »
Dashh, I am sort of irrationally happy for you -- two down and almost $900/mo in extra cash??  Just like that!  Huzzah!
Laugh while you can, monkey-boy

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #253 on: March 10, 2017, 12:46:38 PM »

Thanks for this it was very helpful!

Ok, I just called and paid off the remaining balance of Loan #3.

Loan #3   $882   20.00%   $284

I am running out to the bank and lunch to pay off the Frontier and I am listing it on CL tomorrow.

Also, last night instead of just sitting on the couch and wasting time on my tablet I decided to clean all of the bathrooms in the house.  It felt good to actually do something productive around the house during the week.   

This is AWESOME! 

Thanks for the support!

Ok, truck is now paid off.

Auto loan #2   $1,172   3.84%   $525   Nissan Frontier

It feels pretty good since I have NEVER owned a car outright before.  But it will feel even better to sell it, get something more fuel efficient and be able to pay off a few high interest loans!

I am actually thinking about getting a manual car since I have never learned to drive stick.  I read MMM’s post about that and it really inspired me.  I have always wanted to learn but as I got older just let it go.  I think learning a new skill (my wife can drive stick) is just what I need right now and someday I can teach my sons. 

I am unreasonably and excessively pleased about a complete stranger on the internet having two less debts to pay on every month.  You are inspiring! 

While you still need to see how much you can get for the truck, and how much of the proceeds you'll need to spend on your next car, I'm wondering...

Have you done the cash flow math yet? 

Do you know, that's $809 you've freed up from your monthly debt payments?

Please, tell us, which debt is that going to next?  How long, at that rate, will it take to pay off the next one? 

Inquiring minds need to know...

Hey PJ – my current plan is as follows:

1)    My wife’s bonus hits next week so I am using that plus some of savings (~$1k) to get rid of Loan #1.

2)   I was going to pay off Loan #2 with some savings as well.  That should leave us around $4k - $5k in savings and get rid of the two super high interest loans.

3)   Next we can use start using our snowball on CC #9.

4)   Use the proceeds of truck sale (less new car) to pay off as many other high interest CC’s and loans.

So this is the order I am focusing on now:

Loan #3   $882   20.00%   $284
Auto loan #2   $1,172   3.84%   $525
Loan #1   $4,676   35.90%   $177
Loan #2   $4,278   27.98%   $194
CC #9   $1,000   26.24%   $41
CC #1   $2,588   25.99%   $28
CC #2   $2,279   24.99%   $72
CC #5   $4,376   14.90%   $109

PJ

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Re: Reader Case Study - $231k in debt and need help!
« Reply #254 on: March 10, 2017, 12:53:37 PM »
Fantastic! 

284 + 525 + 177 + 194 = $1,180 to snowball

So CC#9 ($1,000) only has one more month to live! 

*rubs hands together gleefully*

You're killing this!
'To be human you must bear witness to justice. Justice is what love looks like in public." 
Dr. Cornel West

rpr

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Re: Reader Case Study - $231k in debt and need help!
« Reply #255 on: March 10, 2017, 01:01:19 PM »
Fantastic! 

284 + 525 + 177 + 194 = $1,180 to snowball

So CC#9 ($1,000) only has one more month to live! 

*rubs hands together gleefully*

You're killing this!

There is something magical about watching that snowball grow.

freya

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Re: Reader Case Study - $231k in debt and need help!
« Reply #256 on: March 10, 2017, 01:50:53 PM »
That's 5 debts either gone or with less than one month to live!!  Isn't this exciting?  And easier than you probably thought initially?  When your wife's bonus payment comes in, have a wonderful time paying off that usurious 35% loan and then show us a list with 3 loans crossed out.  I must say this is more fun than watching the Super Bowl!

Best of luck with Craigslist this weekend.  Look out for the scammers though.  And have fun with the housecleaning.  Doesn't it feel great to clear junk out of your life?

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #257 on: March 10, 2017, 01:52:07 PM »
That's 5 debts either gone or with less than one month to live!!  Isn't this exciting?  And easier than you probably thought initially?  When your wife's bonus payment comes in, have a wonderful time paying off that usurious 35% loan and then show us a list with 3 loans crossed out.  I must say this is more fun than watching the Super Bowl!

Best of luck with Craigslist this weekend.  Look out for the scammers though.  And have fun with the housecleaning.  Doesn't it feel great to clear junk out of your life?

Thanks Freya - and yes it does feel great!

BlueHouse

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Re: Reader Case Study - $231k in debt and need help!
« Reply #258 on: March 10, 2017, 01:53:29 PM »
current plan is as follows:

1)    My wife’s bonus hits next week so I am using that plus some of savings (~$1k) to get rid of Loan #1.

2)   I was going to pay off Loan #2 with some savings as well.  That should leave us around $4k - $5k in savings and get rid of the two super high interest loans.

3)   Next we can use start using our snowball on CC #9.

4)   Use the proceeds of truck sale (less new car) to pay off as many other high interest CC’s and loans.

So this is the order I am focusing on now:

Loan #3   $882   20.00%   $284
Auto loan #2   $1,172   3.84%   $525
Loan #1   $4,676   35.90%   $177
Loan #2   $4,278   27.98%   $194
CC #9   $1,000   26.24%   $41
CC #1   $2,588   25.99%   $28
CC #2   $2,279   24.99%   $72
CC #5   $4,376   14.90%   $109
I'm so impressed with your progress so far and it sounds as if you'll have another big win in a week or two.  Great work and thanks for motivating me to change something up ! 
Sometimes nothing can be a real cool hand

DanishMM

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Re: Reader Case Study - $231k in debt and need help!
« Reply #259 on: March 10, 2017, 01:58:27 PM »
Congrats!!
Thats amazing!
Have you and your wife celebrated? I dont mean by buying champagne or lobsters...but a hug and a screw-debt-dance?

LadyMuMu

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Re: Reader Case Study - $231k in debt and need help!
« Reply #260 on: March 10, 2017, 06:08:09 PM »
I just read this entire thread and am blown away by the progress you've made in such a short time. I only have one small suggestion. When you sell the truck and get a new-to-you car, get one that is as unglamorous as you can stand. (I like your idea of a manual!) I have three reasons for this. 1) It will start to cement your new mustachian identity into your brain each day as you drive around your town in a "less than" car while knowing inside that you are KILLING it in debt eradication. 2) By comparison, it will make you question other fancy pants choices you are still making. Perhaps next time you need something, you'll opt for another new-to-you (ie Craigslist) option first. 3) The obvious visual difference between your car and your wife's may help nudge her a little closer to team Mustachian. Its a visible sign to her about what you're willing to do to bring financial stability to your family.

We're a one-car family. My husband walks to work each and every day. We live in Iowa. Now he loves to walk and we're a hiking family, but this little daily sacrifice gets him a TON of respect from me all the same.

N

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Re: Reader Case Study - $231k in debt and need help!
« Reply #261 on: March 10, 2017, 09:59:48 PM »
Hey, I think your turnaround is going great! As you flex your MMMuscles, you will get stronger and stronger at resisting spendypants choices.  Keep it up! Keep questioning every expense! Keep talking to your wife and having the tough conversations. Looking forward to following your progress.

PS I was able to sell a car to an aquaintance after sharing I was selling on FB. Dont overlook your own network of friends and relatives when selling a car :)

Good Luck!
N

CmFtns

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Re: Reader Case Study - $231k in debt and need help!
« Reply #262 on: March 10, 2017, 10:43:48 PM »
I am actually thinking about getting a manual car since I have never learned to drive stick.  I read MMM’s post about that and it really inspired me.  I have always wanted to learn but as I got older just let it go.  I think learning a new skill (my wife can drive stick) is just what I need right now and someday I can teach my sons.

You should definitely do this. Driving a manual is awesome. Also, a lot of times manual cars especially manual economy cars are tougher to sell due to a lazy and unwilling to learn population... so you might get a little bit of a deal compared to the automatic equivalent.
"the only efficient way to get there is on the front of the wave" -MMM

PJ

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Re: Reader Case Study - $231k in debt and need help!
« Reply #263 on: March 11, 2017, 12:26:33 AM »
dashh, I wanted to post back this evening to let you know that you inspired me.

I thought I'd cut my budget back pretty far this month, and left myself very little wiggle room so that I could prioritize paying down debt.  But when my utility bills came in much lower than I'd expected, I re-ran my numbers for this month, and decided that "if dashh can get his truck listed and get several bills paid off entirely this month, the least you can do is squeeze out every cent you can toward your debt!"

So I logged into online banking and got that little extra CC payment made!
'To be human you must bear witness to justice. Justice is what love looks like in public." 
Dr. Cornel West

horsepoor

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Re: Reader Case Study - $231k in debt and need help!
« Reply #264 on: March 11, 2017, 09:38:41 AM »
Fantastic! 

284 + 525 + 177 + 194 = $1,180 to snowball

So CC#9 ($1,000) only has one more month to live! 

*rubs hands together gleefully*

You're killing this!

Plus the $185 a month saved on TV/internet, and the money he's about to save on gas and insurance when the truck is replaced with a little >40mpg commuter car.  And the money they'll save on eating out because Dash will use some time meal planning/prep cooking at night instead of channel surfing.  It's like a habit snowball too!

Awesome work.  I'm also over here cheering you on.  It must feel great to have that bit of breathing room that will now let you effectively snowball the hell out of those CC balances!

Villanelle

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Re: Reader Case Study - $231k in debt and need help!
« Reply #265 on: March 11, 2017, 08:18:48 PM »
f you return that TV, you can pay off several more of those debts.  Think how good it felt to ditch the first couple.

I kind of hate to keep harping on the TV thing, but it's more than just the TV.  It's a commitment to your new mindset.   You struggle with actually acting on your ideas and impulses.  Yet you are giving yourself a pass on the TV and allowing yourself to follow the old pattern of not following through.

You are doing great.  You are!  But it's important during these early days of change that you keep your feet to the fire, or you'll gradually ease off and be back where you started. 

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #266 on: March 11, 2017, 08:49:02 PM »
Ok truck is officially posted on Craigslist, Facebook and my wife's work board!

Hoping for a quick sale!

Feivel2000

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Re: Reader Case Study - $231k in debt and need help!
« Reply #267 on: March 12, 2017, 12:38:21 AM »
Just read everything, great progress, man. My thoughts regarding your wife, just from reading this; If I were in her shoes, I would probably think something like:

"We had a good life with everything figured out and then HE had to chase his stupid real-estate flipping dreams! Now we are in dept. But I haven't burned all that money, I have my job and income, making even some extra money thanks to bonuses. Why should I lose all my nice things (house, car, nails,...)? He f***ed up, not me! "

And from what you wrote, she wouldn't be all wrong. Of course, it's a marriage and you are in it together, but you have to go and lead by example and hope that she comes along. Let her have her nails polished and her nice car and take on a second job to pay for all of it. Work your ass of and be frugal. At some point she will prefer having you by her side on a weekend instead of driving an Uber.

Print out the dept and put it somewhere where both of you see it to keep the situation, and your progress, in mind.

But even without any dept, move closer to your work. I did a 60+minutes commute for some time and it drained me. Think about all the lost time! Your child does not have to lose his friends, if both of you can drive this distance every day, you can drive him once per week to keep the connection.

Oh, and return the TV. How many big screens do you need???

Bee21

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Re: Reader Case Study - $231k in debt and need help!
« Reply #268 on: March 12, 2017, 01:25:57 AM »
Dash, you are doing so well. I think this tv and car repair incident came at the right time, as an alarm bell that with all those good intentions you are prone to slipping back into the old habits. Change won't happen overnight, it takes a while to change your spending habits  You made lots of cuts recently, and while those small changes will help, it is the big ticket items (the cars and the house) which will improve your situation considerably.

I hope the truck sells. Don't regret selling it, nobody needs a truck to commute to his office job (khm, apparently my husband does, but we are not in debt). And i disagree with the previous poster about buying a crappy car, buy a decent looking, fuel efficient small commuter car you are comfortable driving.


ShoulderThingThatGoesUp

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Re: Reader Case Study - $231k in debt and need help!
« Reply #269 on: March 12, 2017, 05:48:19 AM »
You're doing it, dashh. When future posters come and are in a really bad way, we'll point to you as an example that it can be done.

SwedishMoustache

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Re: Reader Case Study - $231k in debt and need help!
« Reply #270 on: March 12, 2017, 11:01:59 AM »
Damn sweet job! keep pounding this! You're killing it! :)

Allie

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Re: Reader Case Study - $231k in debt and need help!
« Reply #271 on: March 12, 2017, 12:49:10 PM »
What an awesome read!  You guys are going to do great.  Just remember it is always easy to get another truck, TV, house, whatever.  I was reading a minimalist book, becoming minimalist available on hoopla, recently and it was suggested that you do experiments for 30 days or 60 days or however long and see how it works for your family.  If it doesn't work, that's fine, go back to the old way.  If it does, awesome.  At least that way you know. 

Sell your truck and buy a little car.  If it doesn't work for you after six months, you know for sure and you can go back to make a plan to get a truck again.  Same with the TV.  Go without one of the TVs in a rooms for three months, or the summer, and if it really makes a difference, make a plan to get a new one.  Give up soda and fast food for a month and just see how it makes you feel, if you really want the Big Mac, start eating it again. 

We dug out of six figures of debt with the frugal living and Dave Ramsey plan before mmm came along, but revving up the badassity with the help of this community and blog has really helped us take it to the next level.  Once you start changing your mindset, your wife will join and it will be awesome!  Took my husband a year or so to even consider being more frugal and another to really buy into the plan and make it his own.  But it happened!  Looking forward to reading about your journey!

I'll second how enjoyable it is to take apart a TV.  Our Samsung LCD died a few years ago so we pulled it apart, what's the harm right?  I think it was the capacitor but when we called Samsung to complain about their crappy TV, they sent a guy out to fix it with a new, larger, better part...for free.  If we had just installed the old version, it would have blown again, so a guy to came out and installed the new version.  He was pleased to see the TV already in pieces, it saved him a bunch of trouble!  Always call, always complain, always expect better service, always think of a way that meets your needs and saves money!

Better Late

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Re: Reader Case Study - $231k in debt and need help!
« Reply #272 on: March 12, 2017, 01:32:35 PM »
Hey Dashh. I'm cheering you on as I read the recent posts. From your post about the car and TV though I'm  concerned that you may still be using your credit cards rather than making the complete conversion to cash only budgeting. Using one card to purchase while paying down another doesn't move the needle. And I'm commenting because I have been there (we were over $500k in debt inc. mortgage, cc's, 401k loan, car lease, etc just a couple of years ago);  it's hard to be completely honest with yourself when you've spent years skirting the truth of your reality)

Oil Patch Adams

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Re: Reader Case Study - $231k in debt and need help!
« Reply #273 on: March 12, 2017, 02:47:54 PM »
I just read this entire thread.  Slow start but the snowball is moving, good job.

Personal Finance is different than "a finance" job...I've seen it first hand with my DW.  It's up to you now to educate yours and set a better example for your kids when they can understand the value of a dollar.

Last face punch you'll need is from your spread sheet.  Total up what your debt is costing you each day.  Then break your wages into a day rate.  Sucks to pay someone because you don't have money, that thought alone should ring out in your dreams so when you wake up tomorrow it's a new day and I hope it costs less than the day before.  Soon your day will earn money.

queensborocorp

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Re: Reader Case Study - $231k in debt and need help!
« Reply #274 on: March 13, 2017, 08:02:45 PM »
I hate to be the anti-TV nag. (OK, I love being the anti-TV nag.)

Here are some of the things I knew about The Real Adult World, 10 years ago when I graduated from college:

You have to spend a lot of money on a first date, or your date will think you're a loser.
A small car is unsafe in a crash, plus people will think you're a loser.
It is important that all your furniture matches, or people will think you're poor.
You need to wear expensive designer clothes and shoes, or you'll have no friends.
There is no substitute for living in the most desirable neighborhood.
Real adults don't have Ikea furniture or drive old used cars. Real adults buy new, expensive things.
If you can afford something you should buy it. You work hard, you deserve it.

Only later did I realize all of this was lies. Where did I learn such "knowledge"? From TV, of course.

Big corporations pay for TV shows to be made, and it's in their interest to demonstrate that a high-consumption lifestyle is normal and desirable. They want you spending and in debt. And they know that it's very hard for the brain, on a lizard level, to distinguish TV norms from actual social norms in real life.

TV can end up costing you a lot more than you think.


rpr

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Re: Reader Case Study - $231k in debt and need help!
« Reply #275 on: March 13, 2017, 08:16:34 PM »
I hate to be the anti-TV nag. (OK, I love being the anti-TV nag.)

Here are some of the things I knew about The Real Adult World, 10 years ago when I graduated from college:

You have to spend a lot of money on a first date, or your date will think you're a loser.
A small car is unsafe in a crash, plus people will think you're a loser.
It is important that all your furniture matches, or people will think you're poor.
You need to wear expensive designer clothes and shoes, or you'll have no friends.
There is no substitute for living in the most desirable neighborhood.
Real adults don't have Ikea furniture or drive old used cars. Real adults buy new, expensive things.
If you can afford something you should buy it. You work hard, you deserve it.

Only later did I realize all of this was lies. Where did I learn such "knowledge"? From TV, of course.

Big corporations pay for TV shows to be made, and it's in their interest to demonstrate that a high-consumption lifestyle is normal and desirable. They want you spending and in debt. And they know that it's very hard for the brain, on a lizard level, to distinguish TV norms from actual social norms in real life.

TV can end up costing you a lot more than you think.

queensborocorp -- Welcome to your first post on MMM forums. It is a wonderful one!

Oil Patch Adams

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Re: Reader Case Study - $231k in debt and need help!
« Reply #276 on: March 14, 2017, 06:59:05 AM »
The G rated Tyler Durden speech in advertising!

galliver

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Re: Reader Case Study - $231k in debt and need help!
« Reply #277 on: March 14, 2017, 12:45:48 PM »
3)   Debt:  I am planning on paying off several of our debts in the next month or so.  My wife is getting a bonus of around $3,500 (net) this month which is great.  I should hopefully get around $8-9k from selling the truck and plan on using ~$4k of savings leaving us around $5k.  Also, one of our personal loans will be paid off this month as well.  So if all goes as planned we should be able to pay off around 8 debts which will save us ~1,400/mo which we can snowball.  I am very excited about this as I feel like we will finally be making some progress with the debt!

Ok truck is officially posted on Craigslist, Facebook and my wife's work board!

Hoping for a quick sale!

WOO-HOO! *giant round of applause*

That's all I got :)

Optimiser

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Re: Reader Case Study - $231k in debt and need help!
« Reply #278 on: March 14, 2017, 01:40:51 PM »
Here is another post from an internet stranger who is really excited and happy to see you moving in the right direction!

jessicat

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Re: Reader Case Study - $231k in debt and need help!
« Reply #279 on: March 14, 2017, 03:28:29 PM »
Congratulations on your progress!  So excited for you and your family and your journey!  Can't wait to hear the truck sold.

Verdure

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Re: Reader Case Study - $231k in debt and need help!
« Reply #280 on: March 14, 2017, 03:51:50 PM »
Another internet stranger excited about your progress here!  Congrats on listing the car--that's a huge step. Good luck on a quick sale!  So loving seeing your debt repayment progress; that snowball is super satisfying!

TealBlue

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Re: Reader Case Study - $231k in debt and need help!
« Reply #281 on: March 14, 2017, 05:39:14 PM »
Hi dashh!  I just found you and am excited to follow you're progress :)  Although my debt isn't to your level, I see so many similarities between us in our debt payoff struggle of feeling deserving of the things we are (unreasonably) purchasing and having a spouse who isn't quite as sold on the emergency of the situation as you are!  Anyway, I know firsthand that once the first steps are made, it's easy to keep that momentum going.  Just don't let stupid non-emergencies deter you!  That's my issue!


nouveauRiche

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Re: Reader Case Study - $231k in debt and need help!
« Reply #282 on: March 16, 2017, 06:52:50 AM »
This is awesome dashh!  Another internet stranger here, cheering you on from the sidelines.

I'm excited at the progress you've made already.  It's awesome that your wife has agreed to quit the nail salon for now.  Great work posting the truck!

A few things.
Not sure if this has been mentioned or not:  Would it be possible to rent out your house to cover the mortgage?  It involves becoming a landlord, which is sometimes a pain.  But it would allow you to hang onto the house for now.  Also, your 5/1 rate is now is 4.5%, right?  When it becomes adjustable, it may not change that much.  (It's not going to go to 10%.)  Rates are really low.  You might want to check the fine print & see what will happen with your house payment.  (Ultimately, it would be best to lock into a low rate - they can't stay this low forever.)

MMM writes that people who have a debt emergency should be eating only rice & beans until it's fixed.  He makes it sound like a punishment. I've started making red beans and rice regularly and everyone loves it.  I've also been experimenting with red lentil curries (trying to find the perfect recipe).  Red lentils are dirt cheap at Trader Joe's (if you have one).  There are some great recipe threads in the forum.

One thing we learned from MMM is that "little" things do add up.  When we first found MMM about 2 years ago, I though there was no fat to cut in our spending.  We wound up trimming over $1000 per month by cutting out the housekeeper & the lawn guy, bringing meals & snacks to work, calling around for better deals on insurance, dropping cable, changing cell phone plans, etc, plus generally being more conscious of our spending.

Best of luck to you.  I'm looking forward to following your story as you slash these debts!

ETA:  Another thing I love about MMM is that the changes you make will improve your life in many ways (not just financial).  Cooking at home is better for your wallet and your health.  Biking instead of driving saves you money, gets you fit, and is better for the environment.  Etc. 
« Last Edit: March 16, 2017, 06:56:20 AM by nouveauRiche »

itstheboz

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Re: Reader Case Study - $231k in debt and need help!
« Reply #283 on: March 16, 2017, 09:55:46 AM »

A few things.
Not sure if this has been mentioned or not:  Would it be possible to rent out your house to cover the mortgage?  It involves becoming a landlord, which is sometimes a pain.  But it would allow you to hang onto the house for now.  Also, your 5/1 rate is now is 4.5%, right?  When it becomes adjustable, it may not change that much.  (It's not going to go to 10%.)  Rates are really low.  You might want to check the fine print & see what will happen with your house payment.  (Ultimately, it would be best to lock into a low rate - they can't stay this low forever.)


Rates were really low, but the Fed just raised the rate from .75% to 1.0% (a 33% increase) this week.  This will impact mortgage rates and other interest rates in the near future.  The historically low rates we've seen in the past are probably gone... If you didn't get under 4% before they start creeping up you probably won't anytime soon. 
"People too weak to follow their own dreams will always find a way to discourage yours" -Bob Mayer

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Re: Reader Case Study - $231k in debt and need help!
« Reply #284 on: March 17, 2017, 07:44:56 AM »

A few things.
Not sure if this has been mentioned or not:  Would it be possible to rent out your house to cover the mortgage?  It involves becoming a landlord, which is sometimes a pain.  But it would allow you to hang onto the house for now.  Also, your 5/1 rate is now is 4.5%, right?  When it becomes adjustable, it may not change that much.  (It's not going to go to 10%.)  Rates are really low.  You might want to check the fine print & see what will happen with your house payment.  (Ultimately, it would be best to lock into a low rate - they can't stay this low forever.)


It seems like this might be another plug for selling the expensive house now?  What's "affordable" to many buyers shopping at the top of what the bank will approve them for will decline as interest rates rise.  If the housing market slumps, the Dash family could end up losing equity or even going underwater, whereas selling now and renting near work would be a guaranteed leg up.  Renting is risky and they don't have the financial padding to deal with repairs and legal fees that could be incurred if they get bad renters.

Rates were really low, but the Fed just raised the rate from .75% to 1.0% (a 33% increase) this week.  This will impact mortgage rates and other interest rates in the near future.  The historically low rates we've seen in the past are probably gone... If you didn't get under 4% before they start creeping up you probably won't anytime soon.

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #285 on: March 17, 2017, 11:49:33 AM »
dashh, I wanted to post back this evening to let you know that you inspired me.

I thought I'd cut my budget back pretty far this month, and left myself very little wiggle room so that I could prioritize paying down debt.  But when my utility bills came in much lower than I'd expected, I re-ran my numbers for this month, and decided that "if dashh can get his truck listed and get several bills paid off entirely this month, the least you can do is squeeze out every cent you can toward your debt!"

So I logged into online banking and got that little extra CC payment made!

This is great PJ - I am glad I could inspire YOU since all of you have motivated and helped me out so much so far.


dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #286 on: March 17, 2017, 11:52:29 AM »
Hey Dashh. I'm cheering you on as I read the recent posts. From your post about the car and TV though I'm  concerned that you may still be using your credit cards rather than making the complete conversion to cash only budgeting. Using one card to purchase while paying down another doesn't move the needle. And I'm commenting because I have been there (we were over $500k in debt inc. mortgage, cc's, 401k loan, car lease, etc just a couple of years ago);  it's hard to be completely honest with yourself when you've spent years skirting the truth of your reality)

Thanks for this.  We are not using the credit cards as they are all pretty much maxed out.  So all cash.

I will have to really watch it as we pay them off though to make sure we don't try to use them when something unexpected comes up like a car repair, etc. 


dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #287 on: March 17, 2017, 11:59:03 AM »
This is awesome dashh!  Would it be possible to rent out your house to cover the mortgage? 

I would rather just sell the house and not rent it out.  I've done real estate on the side for a few years.  I have learned I do not want to become a landlord until I am truly ready to do that, even if it is my own house.  I need less stress right now and I see that as just more stress. 

Thanks!

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #288 on: March 17, 2017, 12:48:30 PM »
Hello all,

I wanted to shift my focus to work and get some advice from the forum.  As I mentioned before I am not happy working in accounting, but it is a job and has paid the bills over the years.  I ended up with an Accounting degree basically because my best friend in college wanted to be a CPA.  I resisted and did not sit for the CPA exam (big mistake) since I did not want to work in public accounting.  I went back to school and decided to pursue a change in career to the medical field, but that did not work out.  It was costing me too much money and my heart was not in it (I did it mainly because of my father’s influence).  I then came upon real estate and renovated houses and that is something that really interested me.  I did some research, got some education and started my own LLC.  I successfully flipped several houses and really wanted to try to make real estate work full time.   

I was working full time and doing real estate on the side.  After 10 years working at a private technology start-up (that was acquired and became public), I had moved up the corporate ladder to a Director position and hated it.  The travel sucked and the politics and constant chaos was just too much for me.  That is why I basically engineered my own layoff with severance two years ago.  My plan was to try flipping houses full time.  Well about this time the foreclosure market in my area started to really dry up and it took me nearly a year to find another deal.  I believe foreclosures are at the lowest level since 2005 right now so REO deals are very hard to come by.  I have considered getting my real estate license, but right now I can’t afford to start a new career.  I am also don’t think I would enjoy being a realtor for others as much as renovating houses for my own company.  So for now, I am stuck with accounting again to pay the bills and help us get out of debt with real estate on the side.

So my question boils down to what type of accounting job should I take for now.  Here are the options I have explored so far:

1)   Contract controller/accounting manager position which would entail working with multiple clients on a part time/interim/project basis.  The company focuses on small/medium sized businesses many of which are start-ups.  Starting pay would be between $30/hr - $45/hr depending on the client and can grow to $50+/hr.  Since the ramp up with clients can take time I could possibly stay at my current contract gig (at $45/hr) and start adding clients as opportunities come up. 

Pros:
-      Variety working with multiple clients and could largely work independently. 
-    I would get certified in Quickbooks (new skill set/learning opportunity as I have mainly worked with Enterprise level software)
-   Can earn commission on any new business I refer.
-   Flexibility of schedule which could help me with my real estate side gig and family

Cons:
-     Probably less pay versus a full time job
-     No paid time off (PTO), don’t work don’t get paid
-     Unpredictability of clients (could come and go so hours could drop off until secure another opportunity)
-     No benefits (although I am on my wife’s benefits which are affordable with great coverage)

2)   Full time Accounting role – it has been pretty much impossible to find a Director/Controller position making what I was making before without a CPA license.  So I will probably have to start in a slightly lower level role. 
   
Pros:   
-     Most likely more pay (at least for a while).
-   Paid time off
-   Maybe bonus depending on position
-   Possibly more stable than contract work

Cons:
-     May have to supervise staff depending on role (something I do not really want to do)
-     To make more money or move up to a Controller position I will most likely need to get my CPA which will require a lot of time and money (review course) up front.  I have never had a desire to get my CPA because I never saw myself sticking with accounting forever or in a VP/CFO role.  However, it would make me more marketable so this is could be a Pro and Con.       
-   No variety and may be harder to find a less “corporate” role

I am really struggling with trying to balance not being miserable with my job where I spend 40 hours a week and making the most money I can to get to pay down debt.  And I want to continue my side gig in real estate/renovating because that is something that I can really get excited about and that I consciously chose to pursue.   

There is a part of me that says just suck it up, get a job making the most you can for a few years and get out of debt.  Then you will have more flexibility on what you can do.  Then the other side says I just don’t know if I can handle the typical accounting corporate role for several more years.  Yeah the money would be better but is it worth it if I am miserable all week.   

Thanks for any advice on this! 

Vindicated

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Re: Reader Case Study - $231k in debt and need help!
« Reply #289 on: March 17, 2017, 01:14:31 PM »
I understand your difficulty in deciding options.  I'm kind of in a similar situation.

My current job, we'll call Job Type-0, has medium pay, and I'm not enjoying it at all.

Job Type-1 I'm applying to / interviewing for is higher pay, but I know it will be a lot more work.

Job Type-2 I'm applying to / interviewing for is medium pay, but I'm sure I would enjoy it.

Job Type-3 I'm not applying to, but will probably do when I am closer to FI is lower pay, but I loved it when I did it previously.

For me, I'll likely jump to either Type-1 or Type-2 if I'm given a reasonable offer.  On one hand, Type-1 will be tough, but it'd move my FI timeline up dramatically.  On the other hand, Type-2 would be wonderful and keep me at my current, or maybe slightly better, financial position.

I think your options are similar.  It doesn't really matter if you go for a Type-1 or Type-2, just get out of what you dread.
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MountainFlower

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Re: Reader Case Study - $231k in debt and need help!
« Reply #290 on: March 17, 2017, 02:12:48 PM »
I work as an administrator in a government funded research institution.  Your background would be appropriate for this type of role, but it's so much more than accounting.  We basically manage programs handling everything from finances to HR and hiring, reporting, and everything in between.  Is there a university or something like that in your area?  Might be worth looking into.  While the salaries aren't as high as the private sector, the environment can be very nice and the benefits are usually very good.  For example, my company puts in 10% of my salary for retirement.  I get 11 holidays and 5.5 weeks off per year, plus lots of work from home flexibility. 

Also, the university that I went to will provide career counseling even for Alumni.  I think that there might be a fee for it....but maybe that would open up your horizons. 
« Last Edit: March 17, 2017, 02:15:53 PM by MountainFlower »

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Re: Reader Case Study - $231k in debt and need help!
« Reply #291 on: March 17, 2017, 03:54:58 PM »
Another idea would be to work for a larger consulting firm.

I work as a consultant for a pretty big company so I don't have to worry about not finding a contract to work for the most part. You get the benefits and the PTO, but work at what you are good at. I know my company is always looking for industry experts to fill out their workforce. Consulting is also a pretty good place to make a career change because you can slowly work your way into it with small contracts here and there to expose you to the new work before you plunge right in.

meandmyfamily

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Re: Reader Case Study - $231k in debt and need help!
« Reply #292 on: March 17, 2017, 06:03:55 PM »
dashh-I would cut up your credit cards right now to stop any temptation to charge them back up as you pay them off.

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Re: Reader Case Study - $231k in debt and need help!
« Reply #293 on: March 17, 2017, 06:29:58 PM »
It looks like you're making some real progress.  Good job!

BeautifulDay

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Re: Reader Case Study - $231k in debt and need help!
« Reply #294 on: March 19, 2017, 09:57:34 PM »
Congrats on all your progress. Posing to follow your journey and send well wishes along your way.

Setters-r-Better

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Re: Reader Case Study - $231k in debt and need help!
« Reply #295 on: March 21, 2017, 05:18:20 AM »
Hi Dashh - regarding your career - it seems like your side hustle of real estate made you pretty happy. Is there something you can do related to that that isn't as capital intensive as flipping houses? Maybe you could work with other investors to advise them on flipping. Maybe you could do some manual labor such as painting, landscaping, get your real estate license, even just clean/organize other people's houses might be rewarding for you..I don't know what you're good at...to both stay involved in real estate and also bring in some extra income to pay down your debts faster. If you could build a side hustle you enjoy, that could help you do two things 1) pay down debt faster and 2) build a business for yourself that you could eventually turn into a full time business.

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Re: Reader Case Study - $231k in debt and need help!
« Reply #296 on: March 21, 2017, 08:17:16 AM »
Quick questions, dashh--
1. any bites on the truck sale?

2. What about the house flipping did you like? Was it working with your hands (if you did work yourself)? Was it the gambling aspect of sales? Was it having complete control over a project? Was the satisfaction of turning something old to something new? Can you bring any of these aspects to your current line of work, at least temporarily until house flipping becomes profitable again?

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #297 on: March 21, 2017, 09:32:49 AM »
Hi Dashh - regarding your career - it seems like your side hustle of real estate made you pretty happy. Is there something you can do related to that that isn't as capital intensive as flipping houses? Maybe you could work with other investors to advise them on flipping. Maybe you could do some manual labor such as painting, landscaping, get your real estate license, even just clean/organize other people's houses might be rewarding for you..I don't know what you're good at...to both stay involved in real estate and also bring in some extra income to pay down your debts faster. If you could build a side hustle you enjoy, that could help you do two things 1) pay down debt faster and 2) build a business for yourself that you could eventually turn into a full time business.

Hello Setters-r-Better,

Thanks for the post and questions.  Yes, the real estate side hustle really does make me pretty happy.  The capital is not a problem now since I have a money partner willing to put up all the money to purchase and renovate a property.  Our problem is just supply of deals at this point with the huge dip in foreclosures.  Other investors like to market to “motivated” sellers (yellow letters, bandit signs, etc.) but I have some ethical issues with that approach.  I just feel like I would be taking advantage of people’s situations and I am just not comfortable with that approach to finding properties. 

I have thought a lot about getting my license if for nothing else to stay plugged in to real estate until the supply picks up.  I think it would help me stay motivated while I am working the accounting cubicle job 9-5.  It could also allow me to find deals by networking with other agents.  So that is a good goal for me.

I like the idea of doing some manual labor as well.  I enjoy doing it and it would help me improve my skills for renovating in the future.  A few things I have thought of was volunteering with Habitat for Humanity and also doing some Saturday DIY clinics that Home Depot offers (how to install toilet, etc).  Those will not bring in money but would help me improve my skills.  I could also just do some stuff for other people to make some extra cash like you said. 

dashh

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Re: Reader Case Study - $231k in debt and need help!
« Reply #298 on: March 21, 2017, 10:38:42 AM »
Quick questions, dashh--
1. any bites on the truck sale?

2. What about the house flipping did you like? Was it working with your hands (if you did work yourself)? Was it the gambling aspect of sales? Was it having complete control over a project? Was the satisfaction of turning something old to something new? Can you bring any of these aspects to your current line of work, at least temporarily until house flipping becomes profitable again?

Hey Poundwise,

Thanks for the questions – especially #2 (it really helped me think through what specifically I like about flipping houses).

1)   I have had a few bites on the truck most of which were tire kickers.   I have one out of town guy that seems promising but we will see.  I also took it by the local Auction Direct (like Carmax) and they offered $11,500 to buy it.  It is very tempting to just sell to them or a dealer and be done with it.  I have another dealer that wants to look at and said they will can offer $12,800 contingent upon inspection.  I have a feeling they will lower the final offer to around what Auction Direct offered but we will see.  I can probably get around $13k private party but have to factor in the time to deal with people, look out for scams, confirm funds, etc.  So I am tempted to go with the quick sale and move on especially if the dealer comes in close to $13k. 

2)   There is a lot about house flipping that I like.  I really like the entire process from finding/looking at potential properties, working the numbers on the deal, negotiating the offer to purchase, renovating/working with contractors, listing the property and dealing with agents/buyers to close the deal.  I really get a lot of satisfaction out of turning something old into something nice and new for someone to live in.  I have done some renovating myself but want to improve my skill set and do more of the work in the future since I do enjoy it.  I also like being in control of the entire process and the feeling it gives me that I did it even if I didn’t actually do all the renovations myself.  I made it all come together - MY company did this.  I have never had that feeling working in an accounting office job.  I have felt some satisfaction for doing a good job but it is very different.  I think it is really hard to bring any of those aspects of house flipping into my current job, so I think it is best for me to try to focus on other ways to get those aspects for now (getting real estate license, doing manual labor with Habitat, etc.)   

Paul der Krake

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Re: Reader Case Study - $231k in debt and need help!
« Reply #299 on: March 21, 2017, 02:27:18 PM »
Unfortunately, your truck is worth too much to attract many buyers in Raleigh. Most vehicles being sold are in the 2-7k range, simply because there are few buyers who can pony up much more than that.

When I was in the used car market in that area, I would constantly see reposts of people who wanted too much for their new-ish vehicles, and they would repost a few weeks later and you could tell from the ad that they were mad that no serious offers were made.