The Light at the End of the Tunnel

This certainly has been a productive last seven days.  As was reported in the last post, I had trimmed my debt from $70,000 on 11 cards to $30,000 + on three.  It gets better:

With interest, the largest one had grown to over $34,000 and I was given the opportunity to settle the debt for half of the balance.  Excitement grew until I attempted to get a loan from the three banks with which I have accounts.  I was sadly disappointed that the credit union I belonged to since 1980 would not give me a signature loan.  There has never been a loan with a late payment with them.  I was sadly disappointed.  Sure, the realization is that the credit union is a business and has to answer to the shareholders, but I, too, am a shareholder.  That account will be closed soon.

Back to the settlement: I was able to secure $8,000 to offer as a settlement and called them up with the offer.  I believe it was all in the presentation.  At first they balked as my offer saying that it was less than 25 cents on the dollar.  I presented the fact that they haven't been able to collect even one cent on the dollar lately and that I was sadly considering bankruptcy as an option.  If bankruptcy was pursued, they would get nothing, as this is an unsecured debt.  They then offered to take my $8,000 as a down payment and to pay $900 a month for nine months. 

Unacceptable.

I stood firm on the $8,000 as it was a "take it or leave it" offer.  They took it.  Of course I have to pay $100 a week until the $8,000 is paid off.  If there is overtime available at work, it will be paid off much sooner. 

My other card balance of $1,720.08 was paid off with an offer of $1,032.05.  It is done. Finished.  I have paid over $9,000 in the last week, but I was able to erase over $26,000. 

What a relief!

If I can, so can others...keep the faith!

Have a great day!

Back to it!

After a while away, I am returning to what I love to do:  I love to write about things and want to share my struggles and successes in getting my financial life back to where it belongs.  I started out over three years ago with 11 credit cards, over $60,000 in debt and seemingly no way out of the bad situation in which I had gotten myself.  Fast forward to now and the situation is not great, but it is definitely better than what it was.

I am down to roughly $37,000 in debt (I am rounding off the numbers) and only three cards.  The smallest is less than $2,100 and will be paid off in full by the end of 2013.  This was negotiated for a monthly payment and no interest so as to not further myself in debt in the process.  The second one was dismissed with prejudice by the circuit court as the company dropped the case (although they could retry suing me for the $6,000).  The other big one (for over $28,000) stands unpaid and uncollected and is currently awaiting my summons being served. Once it is, I will get my attorney to fight it for me as I have yet to receive valid proof that this debt is mine. 

My lifestyle has changed dramatically as I have largely forgone eating out (cooking at home save a ton of money), going to movies, wasting money on trivial things, and I drive an 18-year old car that is owned outright. 

I want everybody to know that nothing is impossible and can be done with determination and a plan.  Stick with me and the plan that I am using will be brought to life.

Have a great day!

Got Pets?

Sometimes, when browsing the Internet, I run across stories of people wanting financial assistance because they cannot afford their pets. There are some who would treat their animals better than they would care to treat themselves. I believe that the best thing that one can do is to take care of themselves before worrying about a pet. With that being said, I have to admit that there are now three dogs living in our home. My wife picked up our first dog in January 2003. I was working 60 hours a week and had just begun my MBA studies, so I understood that she wanted something there to keep her company. It wasn't until Zena began to get cataracts and develop total blindness that a search was underway for a companion for Zena (or, a replacement, if you will). Since Zena is blind, my wife looked to adopt a blind puppy and we lucked out when she found, after much searching, Avari. Zena began to get a little more life (although she is permanently blind) and Avari needed a playmate. Carmen is one day older than Avari and is of the same Australian shepherd breed, but Carmen is fully sighted (which gives her a distinct advantage at treat time) over the other two dogs in the house. In order to keep our costs low and the dogs happy, we make our own dog treats. We make both pumpkin treats and dehydrate meat (usually chicken). We probably spend $30 a month making our treats instead of paying $200+ purchasing them already made. If you are wanting to have a pet but not spend a fortune, look into making your own treats and giving them baths instead of always paying somebody else to do it for you. Have a great day!

The Light

I am excited to say that I can see the light at the end of the tunnel, and I know darn well that it is not a train! I started out with $71,779.01 in credit card debt. While the debt hasn't gone away, I have chipped away at some of the problem ones and now have it down from 11 accounts to 4. Two of the accounts are at no interest (hey, "some money is better than no money I told the creditors", and after not being able to collect anything for several years, they concurred).

Part of the change is in my thinking. I used to see just the mountain of debt that I was diligently working on. I was working 70+ hours a week just to keep my head above water. Now, I am focused on building wealth, even though I haven't fully eliminated my credit card debt...yet! I also used to be extremely miserly with my money, but have come to realize that there are people that have it worse than I ever did, so I am sharing out of my abundance.

I have truly been blessed with health (which is improving), family, and employment. Some don't experience that blessing.

Thank you for all that you have done, and keep fighting to keep more of what you make!

Have a great day!

Saving Money With Dogs

I realize that having a pet is an expense, but since my wife and I rarely go to movies or go out to eat much, having a pet is an expense that we chose. We first had a Australian cattle dog-mix (still going) about 8 years ago. She has developed cataracts and a bit of neuritis in the last few years and we decided to adopt a blind, high-energy Australian Shepherd who is about as opposite as you can get. The older dog tolerates her fairly well, but the puppy seems a bit incomplete (our perception) as she loves to play.

We solved that dilemma last week when we drove 200 miles to adopt another Australian Shepherd who is nearly twice the size of our youngest despite being just one day older.

Dogs can be expensive, but we have discovered a way to be frugal with dogs. This is a challenge because we reward our dogs (through obedience training) with treats. We don't buy the commercially made ones, we make them ourselves.

Our treats are one of two types: chicken or pumpkin. Both are fairly easy to make. You can find the pumpkin recipe here or we use an inexpensive dehydrator, buy chicken breasts in bulk, chop the chicken into tiny (about your pinkie nail size) pieces and make a load of treats for a fraction of the cost of purchasing commercially made ones).

A New Book

I have been at it fairly feverishly for the past 10 days as I have decided to write a second book about debt, but I have included a whole section on using coupons to save massive amounts of money. For this portion, I have enlisted the assistance from a former high-school classmate of mine. She is notorious for buying a cart load of items and walking away with a receipt for often under a dollar. She knows her stuff!

I am excited that I am attending her class in Branson Missouri on the 6th of March! I am going to first attend her class on coupons, and afterward will team up to write that section of the book.

I am still playing with a few ideas for the title, but will know more later. The book will be available for purchase/download by July 1, 2011 and 50% of the profits are going to go for her charity in Branson that helps the less fortunate people who need a hand up (and some complimentary food and supplies will be greatly appreciated! I will be sharing a few tidbits on here as the book progresses!

And a Year Goes By

A lot has gone on in the last year since I posted in here. I am going to start a sequel to my book (or a part II, if you will) Never Surrender. No, I am not out of debt yet, but am closer with every day. Here is a glimpse of the last year:

1. We now eat out once a month and I take my food leftovers to eat at work. Even though I was spending $2.15 for supper at the drive-though, it was seriously causing more health challenges then buying organic, wholesome foods (nutrients fill you up, calories don't). We are probably spending the same amount of money as if we were eating out twice a week, but being healthier is darn well worth it.

2. I have 4 credit cards left to pay off (although I haven't used one in three years). Two of them are at no interest and one will be paid in December and the other one will be paid off the following December. I am in no particular rush to pay them off as I can use the extra money to further fund the 401K and get closer to financial independence.

3. I have pretty much stuck to a budget. There has been quite a bit of overtime at work (I am down to just one job for now) so there has been extra funds for a trip to Colorado (10th anniversary) and for a timeshare in Colorado (we enjoyed it that much).

4. I have decided to tithe my money. Lots of time has been spent lately reading book after book after book about finance, wealth, and life. I now realize that I have been entirely focused on my needs while ignoring the needs of others. I have been blessed, it is time to share in my blessings.

I am still money conscious, and will resume more regular posts on here now.

Have a GREAT day!

I Made It (This Far)

No, I am not yet out of credit card debt, but if you will recall, there was a bit of stress about making it until payday (today) on the little money that was left. I don't get to see my son very often or for very long, but he came over for dinner last night (we usually go out to eat, but he was understanding and we had frozen pizzas).

It was a nice time.

When I got up this morning, I noticed that my deposits from my two jobs were in the bank and I immediately transferred some of the money that I took out for repairs (out of the emergency fund) back to its rightful place. When my FSA (Flexible Spending Account) reimburses me for my glasses later, the replenishment of the fund will be complete.

Now to build up my savings so that I can negotiate with my lowest balance credit card that I haven't made any sort of arrangement with yet. I owe over $3,000 on that one, but will begin negotiations when I have at least $1,000 in the bank.

Keep your eye on the prize and have a GREAT day!

Making it Until Payday

The nice thing about a budget is that you see where you are at all times financially. Unfortunately, this is a bleak few days until Friday (I get paid from both jobs on that day). There is a reason why it is a little bleaker than usual ( I do have enough to get gas and there is plenty of food to eat, so no worries there).

There were some unplanned expenses.

The starter in my 1998 Infiniti gave up the ghost. It is very challenging to drive a car without a way to start it, so I took it in to my mechanic and it cost $472.00. Mind you, I do have an emergency fund and there was money to pay for the repair, I will just replenish it in a few days (I am using the money that I would have paid for a car loan, which is no paid off, plus the money that I would have paid two of my creditors, which have also been paid off in the last month). I also needed to get a new pair of glasses that cost (with insurance) $374. The good news is that I have a Flexible Spending account at my full-time job, and I will be reimbursed by the end of February.

It's all good.

Planning for the unexpected is one of the many keys to getting out of credit card debt, and I have made great strides in two years, but the are miles to go before I sleep.

Have a GREAT day!

I May be Broke, But I am NOT Broken

Many times I have heard people say (in the break room) "That machine is broke". The though immediately runs through my head that the machine need to get a job and earn some money. People can be broke, but rarer are the times that we are broken.

Just because we are living frugally at this point in our lives doesn't mean that we are poor. Far from it. In the last year, I have managed to basically live on minimum wage (because I am using just the basics to survive and have cut out most non-necessities). One doesn't need a 52-inch television set to live. One doesn't need a brand new car every year to get by, especially when considering that a car's function should be to get you from point A to point B.

What do you have in your life that you can do without and still survive? If you are having a difficult time paying your bills and climbing out of debt, go with just necessities for a while. I used to have breakfast at Hardees or Burger King every day.

I thought nothing of it and thought that it was no big deal.

It is amazing how much money I have freed up just by eating most of my meals at home. Yes, I eat out once or twice a month, but even then it is at an all-you-can-eat dinner or with a coupon so that there is some savings involved. If I want to turn it up a notch, I might even eliminate that luxury.

Just find ways that you can save/make more money so that you can live your life more freely... the way you want to.

Have a GREAT day!

Are You Getting a Tax Refund?

I read quite a bit of interesting discussion on moneyning in the last 24 hours. There seems to be two schools of thought on getting a refund: on one hand, it is your money, not the governments, so if you get a big refund from Uncle Sam each year, that equates to an interest-free loan to the government. On the other hand, some tend to use the refund as their way of saving money.

Because I have been burned by taxes in the past, I fall into the second category.

I may revisit that strategy. Because of my past, I mentally would much rather overpay on my taxes and get a refund than to owe ONE SINGLE DIME. With proper planning, I know that I can tweak my withholding so that we will get little or nothing back. Right now, that would equate to an extra $50-100 a week that could be used to pay down my remaining debt. The thing is that my wife and I have managed to set aside a decent emergency fund, but it isn't nearly enough.

What do you think? Let me know.

Have a GREAT day!

Bite The Bullet and Do a Budget

It is a word that few like. I have found that a budget is something that I can live with now. What happened is that I grew tired of having too much month left at the end of my money and I was wondering where all the money went.

As it is said, "If you fail to plan, you plan to fail".

* First, you may have to keep a record of every single penny that you spend. Buy a soda from the vending machine at work...write it down. Send off a payment for your mortgage...write it down. Give a dollar to a man on the street who is asking for donations...write it down. After a month of writing it down, categorize everything (meals, fuel, car payment, entertainment, etc.).

* Make a trial budget. After looking at your numbers, decide what you really need to spend. The key is to have every dollar accounted for that you are bringing in. This will take a few months for you to fine-tune your budget.

* Stick to it. Some things will not change, like your car payment. Some you have a little more control over, like food.

* Find ways that you are spending needlessly. This is imperative so that you can pay down your credit card debt.

If you need more money, try taking a second job, it doesn't have to be in your area of expertise even. My second jobs have been cleaning offices at night and cashiering. While I have an MBA, I am not to proud to actually do a mundane job to generate some debt-reducing income.

Have a GREAT day!

Vacation Planning

Sitting in the classroom (I am in training right now for a new position), I heard how some of my classmates are planning a trip on their children's spring break. The classmate was talking about taking a train ride to the Mall of America and spending the weekend there. Personally I view that as a waste of money. What is there to do at Mall of America?

Shop.

Spend Money.

I don't want to spend my time at a conglomeration of stores. Maybe because I don't like to shop. Shopping for me is to "get in, get it, and get out". A great goal is to spend as little time in there as possible. The more time that is spent there, the more money that is spent. Typically that is what the merchants want. Stores are set up to where the most desirable items are in the back of the store and you would have to spend a lot of time to get there.

And don't forget about the impulse items that are at the checkout stand. There is always candy and treats along with worthless magazines that have no literary value. Save your money and go to the library.

The library is free.

Spending time together as a family doesn't need to cost a lot of money. If you spend too much money, perhaps you are trying to make up for some deficit in your life.

Have a great day!

Brother, Can You Spare a Dime?

This was one of the lines that was made famous by the Great Depression of the 20th century. A dime doesn't represent that much money, but it can add up. As I like to play with spreadsheets, I was toying with the notion of a dime a day. Keep in mind that the figures I give are not figuring any interest.

A dime a day for thirty years (average number of working years) comes up to a grand total of $1,092.00 What could you do with an extra thousand dollars? A quarter a day comes up to $2,730.00 If you could muster $5.00 a day, you could have a major renovation to your home in the amount of $81,900.00. That's a lot of money to a lot of people (including myself). It would be enough for me to be completely out of debt.

It is no small wonder that stores and companies will nickel-and-dime you to death. They are not stupid. There is great money in the nickel and dimes of the world. Any opportunity for you to save a nickel here and a dime there will add up to lots of dollars that you could use to pay off your debt, to save for the future, or live life as you desire.

Have a great day!

Eat Drink and Be Merry

There are times when people ask me why I am making such sacrifices now (like eating a lunch that costs less than $0.50) when it isn't going to matter when I die.

True.

But...it may matter to those I leave behind. There is no wish on my part to leave a mountain of debt for somebody else to deal with. Although they are not personally liable for any of it, there is all the vultures, I mean lawyers, and other undesirables to deal with. I got myself into this situation, and I will take responsibility and get out. My mother used to say "if you are going to dance, you gotta pay the piper". I should have only danced with what I could afford, but, like too many people, I only thought about the immediate pleasure that I got that didn't even last long enough for the next statement to arrive. Now I am older (and hopefully wiser) and pay for things out of my checking account (or cash). If I can't afford it, I don't get it.

Have a great day!

Bucket List

Yesterday in the training class at my day job, we had a new trainer for the week. As is tradition, there is an ice breaker that gives us a chance to know more about the trainer and for the trainer and the class to learn more about yourself. Yesterday, ours was to create a five item "bucket list", or a list of things that you wanted to accomplish before you "kick the bucket".

One person stated that one of their items was to have more money, at which point, I stood up, walked over to that person and handed them a nickel. I stated that they could now cross that item off their bucket list because they now had more money.

She did.

The problem was that this was not a SMART goal. For those of you familiar with SMART goals, you know that goals need to be Specific, Measurable, Achievable, Realistic and with a Time table. If not, they are just wishes. To achieve a goal, you have to know what you are going for. This takes a little bit of time, but it is worth it to have your goals specifically lined out, especially when working toward eliminating debt from your life (at this moment, I have $56,493.23 in debt and I keep several spreadsheet on my laptop to chart the progress).

Have a great day!

Day One of the First Workweek of 2010

Baby, it's cold outside.

The temperature this morning was a brisk 4 degrees when I went to start the car this morning. I love cold weather, but the heating bill goes up as the temperature goes down. Some ways to save on heating costs during the winter can help you to save a little (so that you can pay down your credit card debt):

Lower Your Thermostat - A programmable thermostat certainly helps. The one in our house is set at around 60 during the day (winter) and 65 at night. Keep extra blankets around.

Shut rooms you don't use - If you don't need to heat it, don't waste your money.

Check for leaks around windows and door - Little pesky drafts are essentially money out the door. A small investment in stopping the leaks means big savings in your pockets.

Use your fireplace if you have one - Fortunately there is one in the house where I live and I love a fire in the winter. We are fortunate that our wood is delivered to our house so we don't have to do any of the hauling.

It's New Day, A New Year, A New Life

I love New Year's Day. To me it is about taking the best of the past and making your future better. A lot of people just blindly write New Year's resolutions that they have no intent on keeping and are usually unrealistic.

As you have been reading, I have had a credit card debt problem in the past. In February 2008 I quit using credit cards. There was over $71,549.12 in credit card debt. I don't have anything to show for it, no small house, no Hummer, nothing to speak of.

How did you charge that much?

Basically, I charged everything: gas, food, snacks at the gas station....everything. Then I made the big mistake of only making the minimum payment. Of course, the credit card companies would increase my limit as I continued to charge. I thought only of the minimum payment, not the long-term cost.

Big mistake.

I first thought that I was doing the right thing by going with a debt consolidator/debt negotiator. The only thing that happened in four months was that I was $2,800 out of pocket and my credit cards were now in default. Now, on January 1, 2010, the debt is down to $56,493.23. The end is in sight now and I have become more and more money conscious. I will be sharing with you thoughts and actions in future blogs.

Happy New Year!

How Can I Save Money When I Don't Earn Much?

This question came to me from a coworker at my second job. She is a single mother of a disabled child. She feels limited in how much she can earn because if she earns too much, she will lose the much-needed Medicaid benefits for her disabled son.

I asked her quite a few questions about her eating/drinking habits as to how she bought things. It turns out that we were able to find almost $1,300+ in savings per year on some seemingly innocent actions.

First, she liked to purchase a drink at work every day. She justified it by saying that it was not a soda pop because it wasn't carbonated and didn't have caffeine. It was still $1.02 a day that was unneccesarily spent, particularly when filtered water is free out of the breakroon. Over a year's time, that one drink a day, five days a week, 50 weeks a year (two weeks of vacation) added up to $255 a year. I reframed it by asking her "How would you like it if I gave you a bottle of Poweraid a day for every day that you worked for a year, but you have to give me $255 today?" She didn't realize how the little things add up so quickly.

Secondly, she admitted to having some chips and snacks at work too...to the tune of $4.50 a day. That expense comes to a whopping $1,125.00 a year. We worked on a plan to purchase food at the grocery store or Wal-Mart in advance so that she could bring some of the same things to work from home and save the money.

The challenge is that so many people who are poor will remain poor if they listen to the sales people say that it is just pennies a day, or a few dollars a week. That is money out of your pockets and into theirs. If you live in a major city of 1 million people and everybody just gave you one penny a day (just a penny), you would make $3.65 million a year.

It all adds up!

Saving Money on Vacation

Vacations are great.

With that being said, vacations, in order to be at a lower stress level, require a bit of work. They can be made more financially affordable when planning is part of the process. Let me explain...

...My wife and I just returned from a 5-day cruise to Mexico. I have a co-worker at my day job that told me that it would be a good idea to pack your favorite snacks and sodas in your carry on luggage because they were not free! That is a great idea. We packed about 20 cans of soda into our luggage. Buying the case from our local Wal-mart for $5.41 for 24 cans now makes a lot more sense that the $81.42 that those same drinks would have cost on the ship. Not only did the sodas cost $2.95 each, a 15% gratuity was added as well.

Keep in mind that this was an all-inclusive cruise for which you had to pay nothing more for all the food that you could eat. Warning: the only free drink would be self-serve water, some juices at the buffet, and coffee. Everything else had a price.

That goes for pictures as well. Every time you would get off the boat, have dinner, get on the boat, etc. there would be somebody snapping your picture. It is a good thing that I do not like having my picture taken because I could have easily been out of another $200+ just for some "candid" photos. No thanks. Besides, the best pictures are those inside your head.

I hope that everybody has a Happy New Year!