Debt

[yo mama]

The housing market on the West Coast is ridiculous and I think that it's best to be patient and wait for a good deal to open up.

 

Don't get me started.

[Ursa Majoris]

I think (thanks to Dave Ramsey) it is also important to have an Emergency fund (4 to 6 mths of expenses) as well as the proper disability insurance to guard against these things.

 

Working on the emergency fund. Fortunately, I have a small income for life that isn't tied to my job. Not enough to live on, not even close, but very handy just the same.

[SayItAintSoJoe]

I don't disagree, but I think reality for many people involves choosing between true necessities. If I have $X dollars in my monthly budget, should I spend it on good private school tuition for my kids, or start an emergency fund? Do I spend my annual bonus replacing a new roof that may not make it another year, or should I pay off my high interest credit cards? While discipline is certainly a problem for some people, even discplined people frequently have tough decisions to make.

 

 

 

Personally, I followed the Dave Ramsey "Total Money Makeover" (baby) steps. A fully funded emergency fund comes only after all non-mortgage dept has been paid off. My post regarding the Emergency Fund was in reply to Ursa's comment that he was CC debt free and had no car payment but was just one illness or job loss away from falling back into the hole.

 

Dave's the man and lays out an easy to understand plan in his book. I recommend this book to anyone who is in trouble (like I was) with debt. Read it (and follow it) and you'll be able to handle the tuition, roof, and anything else that comes your way.

[yo mama]

Dave's the man and lays out an easy to understand plan in his book. I recommend this book to anyone who is in trouble (like I was) with debt. Read it (and follow it) and you'll be able to handle the tuition, roof, and anything else that comes your way.

 

I appriciate the recommendation, but I think I'll take the cost of the book and apply it towards my new roof.

[10MILESDEEP]

There's good sense... and then there's bad taste.

 

[alexgaddis]

I just financed a cookie from the deli...

[SayItAintSoJoe]

I appriciate the recommendation, but I think I'll take the cost of the book and apply it towards my new roof.

 

 

Go to the library and you can have both the book and a good roof over your head for free.

[Puddy]

Go to the library and you can have both the book and a good roof over your head for free.

 

 

Sign me up for one of those

[MojoMan]

Actually, Cliaz is the one who posted the article, so you need to thank him.

 

 

Who is cliaz? Is he new here? Does he post much?

[cliaz]

We took my bonus and put that in our emergency fund. We now have 9 months worth of bills that isn't being touched.

[The Holy Roller]

I just watched cliaz's Ghetto Fried Chicken video. There is a group of folks who obviously are not interested in this thread.

[cliaz]

I just watched cliaz's Ghetto Fried Chicken video. There is a group of folks who obviously are not interested in this thread.

 

 

 

 

Is that not the most awesome video every made?

 

 

Now if we could get a bunch of red neck trailer trash to do: "Everybody wants a sip from my budweiser" we'd be good to go.

[The Holy Roller]

Is that not the most awesome video every made?

Now if we could get a bunch of red neck trailer trash to do: "Everybody wants a sip from my budweiser" we'd be good to go.

 

 

It sorta reminds me of my old neighborhood in north St. Louis. I would like the lyrics because the tune is very catchy.

[cliaz]

It sorta reminds me of my old neighborhood in north St. Louis. I would like the lyrics because the tune is very catchy.

 

 

 

Peep this one out. The beat and tune is really good but it's so freaking racist its not even funny.

 

 

Spain is the dude in the chicken get up

 

 

 

 

 

 

 

 

EDIT - I'm so lame I hijacked my own thread.

Edited March 28, 2007 by cliaz

[spain]

As I have stated many times before on this board, debt scares the shi@te out of me. The only debt I have is my mortgage. I was raised in a poor, but not poverty stricken, single parent with 3 kids and no child support household. We never had any money. But we didnt have any credit cards either. Credit wasnt nearly as easy to get in those days and they dam sure werent going to give people like us a credit card. When we needed new clothes for the new school year each fall, my Mom would put them on "layaway". You younger huddlers probably dont even know what that is. You would go to the store and get them to hold the items that you wanted in the back. You would come in and pay a little on them each week until you could pay them off. No interest. Once they were paid off, you could take them home. We would get a size too big and by the time we had them paid off, the clothes fit just about right. I know that sounds crazy, but some of you "older" huddlers know what I am talking about. I think layaway went out of vogue when everywhere was given as many credit cards as they wanted.

[cliaz]

As I have stated many times before on this board, debt scares the shi@te out of me. The only debt I have is my mortgage. I was raised in a poor, but not poverty stricken, single parent with 3 kids and no child support household. We never had any money. But we didnt have any credit cards either. Credit wasnt nearly as easy to get in those days and they dam sure werent going to give people like us a credit card. When we needed new clothes for the new school year each fall, my Mom would put them on "layaway". You younger huddlers probably dont even know what that is. You would go to the store and get them to hold the items that you wanted in the back. You would come in and pay a little on them each week until you could pay them off. No interest. Once they were paid off, you could take them home. We would get a size too big and by the time we had them paid off, the clothes fit just about right. I know that sounds crazy, but some of you "older" huddlers know what I am talking about. I think layaway went out of vogue when everywhere was given as many credit cards as they wanted.

 

 

 

Dude i mirror this post. When my father left us we were so poor that we went grocery shopping at the local church. Layway was when we were semi - lucky and knew we could get new clothes. Then my muv married my step fother and in 1980 he had a 30 gallon drum fall 2 stories, hit him on his back and then he fell 2 more stories to the groud while fighting a fire. He was in bed for a year and we were hating it because the d@mn insurance company brought out the big dog lawyers to try and slither their way out of paying what they owed us.

 

Being poor is a frightening thing to me. I will do whatever it takes for my kids to not go through that. I hear ya spain. Believe me I hear ya.

[SayItAintSoJoe]

As I have stated many times before on this board, debt scares the shi@te out of me. The only debt I have is my mortgage. I was raised in a poor, but not poverty stricken, single parent with 3 kids and no child support household. We never had any money. But we didnt have any credit cards either. Credit wasnt nearly as easy to get in those days and they dam sure werent going to give people like us a credit card. When we needed new clothes for the new school year each fall, my Mom would put them on "layaway". You younger huddlers probably dont even know what that is. You would go to the store and get them to hold the items that you wanted in the back. You would come in and pay a little on them each week until you could pay them off. No interest. Once they were paid off, you could take them home. We would get a size too big and by the time we had them paid off, the clothes fit just about right. I know that sounds crazy, but some of you "older" huddlers know what I am talking about. I think layaway went out of vogue when everywhere was given as many credit cards as they wanted.

 

 

I too, grew up under similar circumstances. The funny thing is I never even knew how poor we were till I got older and was able to improve my own circumstances. Hand-me-down clothes, mismatch appliances, old cars were all part of my childhood. I remember going to my cousin’s house in the burbs and marveling at the fact that he had a toy box filled with toys. I used to play with his toys for hours. I guess that’s why now I tend to spoil my own children. I also get really pissed at my wife if I ever see my kids wearing something that looks old (poor). I hate having anything around me that reminds me of being poor. However, the weird thing is that looking back at my childhood, I wouldn’t change a thing. Go figure…

[wiegie]

D*amn, we all a bunch of poor bastards. I remember when I was a teenager and pretty much decided that all I would need in life to feel contented was enough money in my savings account to pay to get my car fixed when it broke down.

 

I think there is an old Buddhist saying that goes something like , "The secret to happiness is not getting what you want, it is wanting what you have." Pretty good saying, IMO.

[The Holy Roller]

D*amn, we all a bunch of poor bastards. I remember when I was a teenager and pretty much decided that all I would need in life to feel contented was enough money in my savings account to pay to get my car fixed when it broke down.

 

I think there is an old Buddhist saying that goes something like , "The secret to happiness is not getting what you want, it is wanting what you have." Pretty good saying, IMO.

 

 

Indeed we were. And what makes this a great country is the fact that we had the opportunity to work our way out of the situation we were in and make a better lot of our lives. And that opportunity begins with...education. So thank a teacher that you can read this. Then get back to work.

[Puddy]

 

I think there is an old Buddhist saying that goes something like , "The secret to happiness is not getting what you want, it is wanting what you have." Pretty good saying, IMO.

 

 

My friend the communist

Holds meetings in his RV

I can't afford his gas

So I'm stuck here watching TV

I don't have digital

I don't have diddly squat

It's not having what you want

It's wanting what you've got

 

 

[CHORUS:]

I'm gonna soak up the sun

Gonna tell everyone

To lighten up

(I'm gonna tell 'em that)

I've got no one to blame

For every time I feel lame

I'm looking up o I'm gonna soak up the sun

 

Sheryl Crow's a buddhist

[Azazello1313]

I love these Huddler conversations on debt.

 

For myself, I have six months of living expenses in savings (read: I wouldn't have to change my spending habits if I lost an income, not just enough to pay bills), and no credit card debt. I do use my AMEX ,but I get cash back at the end of the year (last year it was $477). I figure, since I have the discipline to not spend more than my income per month, I'll make my credit work for me in the guise of cash back and airline miles. And...

 

I will say, I just bought a car and have that car payment. I didn't have a car payment for a while, but I made sure I have the six months of car payments in savings and I'll chip away at the car like I did my last one. And...don't blindly assume getting a second mortgage to finance a car is the way to go. I put pen to paper and figured out the tax advantages, etc. vs having a car loan, and I came out quite a bit ahead using the car loan...FWIW.

 

Ultimately, I place the onus on the consumer who is living outside of their respective means, not the banks/credit card companies.

 

 

i agree with you completely. used responsibly, credit CAN be a very useful tool, and it is certainly the case that invididuals and credit card banks can establish mutually beneficial relationships. i don't really see CC companies as evil, they just sell something that a lot of people have a hard time using responsibly.

 

obviously, carrying debt at 15+% interest is really, really bad idea. but having a few thousand dollars on a card with a 0% APR for 15 months if you know you can pay it off before it expires? not such a bad idea. i did that last year for our wedding. one more payment of $700 next month and that debt is gone, just as the 0% interest expires. other than that and the mortgage, we have zero debt right now. of course, we put just about everything we buy on a couple other rewards credit cards, and pay off the statement balance every month. they give you a few hundred bucks of free stuff every year, and a month or more of free float on all of your purchases, and you give them....well, nothing really -- they take a few points on all your purchases, but the vendor pays that and you'd pay them the exact same price if you paid cash.

 

we currently don't have any car notes, which is nice, but it's not exactly the dumbest thing in the world to carry one or two. it all depends on your priorities. if you just wanna get from point a to point b as cheaply as possible, yeah you can only pay cash for cars and spend your life driving around a 15 year old senta. if you want a sweet german ride with 400 HP like soup, most of us are probably gonna have to take a loan out on that one. if you get a decent rate, and don't have to forsake other financial goals (like paying off CC debt, savings and retirement contributions), then doing so isn't necessarily the "wrong" answer.

 

the advice of people like dave ramsey is great for the right kind of person. like the person who was irresponsible in the past and became addicted to living beyond their means. his advice takes an attitude like an intervention for addicts. some people need that. other people don't.

[Ursa Majoris]

i agree with you completely. used responsibly, credit CAN be a very useful tool, and it is certainly the case that invididuals and credit card banks can establish mutually beneficial relationships. i don't really see CC companies as evil, they just sell something that a lot of people have a hard time using responsibly.

 

obviously, carrying debt at 15+% interest is really, really bad idea. but having a few thousand dollars on a card with a 0% APR for 15 months if you know you can pay it off before it expires? not such a bad idea. i did that last year for our wedding. one more payment of $700 next month and that debt is gone, just as the 0% interest expires. other than that and the mortgage, we have zero debt right now. of course, we put just about everything we buy on a couple other rewards credit cards, and pay off the statement balance every month. they give you a few hundred bucks of free stuff every year, and a month or more of free float on all of your purchases, and you give them....well, nothing really -- they take a few points on all your purchases, but the vendor pays that and you'd pay them the exact same price if you paid cash.

 

we currently don't have any car notes, which is nice, but it's not exactly the dumbest thing in the world to carry one or two. it all depends on your priorities. if you just wanna get from point a to point b as cheaply as possible, yeah you can only pay cash for cars and spend your life driving around a 15 year old senta. if you want a sweet german ride with 400 HP like soup, most of us are probably gonna have to take a loan out on that one. if you get a decent rate, and don't have to forsake other financial goals (like paying off CC debt, savings and retirement contributions), then doing so isn't necessarily the "wrong" answer.

 

the advice of people like dave ramsey is great for the right kind of person. like the person who was irresponsible in the past and became addicted to living beyond their means. his advice takes an attitude like an intervention for addicts. some people need that. other people don't.

 

Good info here. I have a Best Buy store card but only buy stuff with 0% interest, several months to pay and then I spread the payments, always finishing up just before the interest free period runs out.

 

There's nothing wrong with credit - IF you can manage it. If you can get a card that effectively pays you to have it e.g. an annual cashback type, it's way better than cash. But - you have to pay it off each month and you have to treat it just the same as you would treat folding money.

 

Cars on 0% interest can still be had too. As with everything though - can you afford the monthly payments? Ultimately, it's all down to personal responsibility.

[I Like Soup]

i agree with you completely. used responsibly, credit CAN be a very useful tool, and it is certainly the case that invididuals and credit card banks can establish mutually beneficial relationships. i don't really see CC companies as evil, they just sell something that a lot of people have a hard time using responsibly.

 

obviously, carrying debt at 15+% interest is really, really bad idea. but having a few thousand dollars on a card with a 0% APR for 15 months if you know you can pay it off before it expires? not such a bad idea. i did that last year for our wedding. one more payment of $700 next month and that debt is gone, just as the 0% interest expires. other than that and the mortgage, we have zero debt right now. of course, we put just about everything we buy on a couple other rewards credit cards, and pay off the statement balance every month. they give you a few hundred bucks of free stuff every year, and a month or more of free float on all of your purchases, and you give them....well, nothing really -- they take a few points on all your purchases, but the vendor pays that and you'd pay them the exact same price if you paid cash.

 

we currently don't have any car notes, which is nice, but it's not exactly the dumbest thing in the world to carry one or two. it all depends on your priorities. if you just wanna get from point a to point b as cheaply as possible, yeah you can only pay cash for cars and spend your life driving around a 15 year old senta. if you want a sweet german ride with 400 HP like soup, most of us are probably gonna have to take a loan out on that one. if you get a decent rate, and don't have to forsake other financial goals (like paying off CC debt, savings and retirement contributions), then doing so isn't necessarily the "wrong" answer.

 

the advice of people like dave ramsey is great for the right kind of person. like the person who was irresponsible in the past and became addicted to living beyond their means. his advice takes an attitude like an intervention for addicts. some people need that. other people don't.

 

Good info here. I am a 0% interest wh0re when it comes to the credit cards. I've even thought of getting the max I can put in a Roth IRA at the beginning of the year on a 0% offer, putting it into the Roth, and then paying the 0% off within the time period. That way, the Roth is earning max at the beginning of the year, and I am simply paying the balance back to the card at no cost to myself.

 

And...my car has 470HP biatch! Leave those little piddly 400HP types (read: TimC) at the stoplight!

[Azazello1313]

Credit wasnt nearly as easy to get in those days and they dam sure werent going to give people like us a credit card. When we needed new clothes for the new school year each fall, my Mom would put them on "layaway". You younger huddlers probably dont even know what that is. You would go to the store and get them to hold the items that you wanted in the back. You would come in and pay a little on them each week until you could pay them off. No interest. Once they were paid off, you could take them home. We would get a size too big and by the time we had them paid off, the clothes fit just about right. I know that sounds crazy, but some of you "older" huddlers know what I am talking about.

 

i'm not THAT old, but yeah i've definitely "been there". i was actually in wal-mart pretty recently and noticed some little sign by the register noting that they were ending their lawaway plan altogether. guess that's an idea whose time has come and gone. but yeah, that brought back vivid memories of waiting in the layaway line at the back of our old k-mart. and of asking my mom if i could have a new bike, her saying there's no way she could afford it, me crying "come on, couldn't we put it on layaway?"

 

but you know, i never really minded being poor (or more accurately, "lower middle class") as a kid. we lived in the basement of my grandma's house most of my childhood, but i have a lot more positive memories associated with that than negative. we didn't always get what we wanted, but we got what we needed and that was fine. i don't ever remember feeling terribly jealous or resentful of the kids who had more, or feeling marginalized because i lived in my grandma's basement. life was what it was, and what it was was fine. i guess that attitude has pretty much followed me into adult life, because i've never been very ambitious when it comes to making money. my #1 financial goal in life is to just not have to worry. being able to enjoy a few of the finer things is nice, but it's not something i feel terribly driven to pursue more of.

 

it all just reminds me how incredibly lucky we are to live here, now, where even a relatively modest existence carries comforts and idle pursuits that have historically only been available to kings.

[Perchoutofwater]

I use a credit card for every purchase that I can. The reason I do this is I get cash back and pay off the credit card in full at the end of every month. The only debt I have is a car payment which is 0% interest, a balloon note on a second piece of property I own that is a 6% and will be paid off this time next year, and my mortgage. The reason for the balloon note was that I thought my money manager would make more than 6% on my liquid assets and he has. I have enough liquid assets to pay off all my debt with the exception of the mortgage and live at my current lifestyle for 18 months. I use debt when it is in my best interest. There is nothing wrong with debt as long as you are responsible with it.