Screwed Up Royally

[christina33]

Was a member here a few years ago and got back on my feet. However, I forgot the RULES and wound up in debt again! Not feeling sorry for myself just embarrassed and ashamed of my stupidity. However, I am committed to cleaning up my $$$$ of financial messiness!!

Debt -
HSBC - $3000
IRS - $3000
Collections - $400
Student loan - 10,000


In need of
Hearing aids _ ~ 6000
Car repairs - 600
Housing down payment - 20,000


Monthly Bills

Food - 300
Insurance = 400
Teacher Supplies _ 50 - 100
Gas - 100
Cell phone - 90
Rent ( includes utilities except for phone) - 600
Mother ( Sick) - 200
Travel to visit mother monthly - 200

My take home pay is $2900 after taxes from my primary job and about $900 a month from my part-time job. I am picking up some additional work at permanent job beginning March ( 4 hours @ $30/hr).

I am open to all suggestions on how to make this work and quickly. My most important thing is finding permanent housing by September.. Houses in my area are cheap but rent isnt'. So I am getting rid of the collections with part-time pay on February 16th, trying to improve credit score. But I need a concrete saving plan to get to 15,000 by end of summer.

Thanks for having me back!

[BlissMommy]

You can do it!

[Luckybustert]

Welcome back! You've already taken the first step, so just keep at it and pretty soon you'll have that mess cleaned up!

[Anna43]

You do not have all catagories listed for your budget so its difficult to know exactly what your expenses are. Do you know? If not that's where you need to start, keep track of all spending for a month or two.

I would make a point of living on only your regular income and using all extra income for debt. I would make savings a part of the budget of your regular income.

I would not rush into buying a home until I got debt paid down and savings built up. Buying too soon could put you into foreclosure which isn't part of your plan!

[khaski]

Welcome back! The first thing you need to do is get rid of that IRS debt!!!! I would skip even thinking about buying a house unitl you're debt free, have a good chunk to put down AND an good sized EF. Sure, mortgages might be cheaper at the moment than rent in your area- but you're not acocunting for taxes, repairs, etc. Homeownership is VERY expensive sometimes, best to rent while you get yourself together. If something goes wrong, your landlord fixes it, it won't come out of your pocket. If you buy a house with other debts and no emergency $, you will get deeper in the hole! Work on debt-free and emergency savings first, then move onto home owenrship.

[Charro]

It looks like you have about 1800.00 to distribute between needs and accrued debt,after basic expenses. Obviously, the first month you will need to do the car repairs. No car, no taking care of mom or travel , if it isn't fixed. That leaves you 1200.00, the first month. I would apply it to the three outstanding debts. Put your housebuying on hold for this year. Check into programs for Seniors. You might be able to get some help with the cost of hearing aids. Does your Mom have any kind of insurance ? After the first month, I would arrange the debt payments as regular payments so you know what is coming out of your check each month. If you are single, you can certainly pare back the food expense. I feed three adults and one teenager, two dogs and two cats on 400.00 a month. And no, we don't eat a continuous diet of rice and beans. We eat nutritious, healthful meals. Brown
bagging for lunch and couponing and eating a few meatless meals a week would be helpful. If you pay 400.00 on each of the three outstanding debts,the two smaller debts will be paid in 7.5 months. Your student loan would be paid in 25 months(a little over two years). That still leaves you 600.00 a month to save for the hearing aids. (It would take you ten months, unless you find someone willing to let you pay them out after purchase) After the two smaller debts are paid, You could take that money and have the hearing aids purchased in no time. I would then continue to make regular payments on the Student Loan and save what is left each month. My daughter had a student loan and while she was paying, she saved and was able to bargain with them for a payoff amount as soon as she had money saved to do it with. They accepted a little over half. Hers, however, had been turned over for collection before she started making regular payments and saving. (she had an extended illness and ended up in not being able to pay until she was well)
When your debts are paid, you could save very quickly for a down payment on a house and still have money to save for emergencies. You might want to give up the part time job at that point. Good health and a little down time is vital to your life.
It sounds like your life is a balancing act right now. Good luck!

[mombottoo]

I'm showing you with a balance left of $1860 after deducting your monthly bills. Depending on what your credit payments are will depend on what is left of the 1860.

If you are starting out with a 0 balance for the down payment and want to save $20,000 by September you would need to save $2500 per month starting this month. Even with the overtime that starts in March I don't see how, with the figures you furnished for you to save $2500 per month.

Good luck & wlecome back...

[Cricketlegs]

I'm confused about the hearing aids. Why so much. I have profound loss and am recommended for the implant and my audiologist quoted me at under $4000 for 2 news aids as I am so not ready to get implants yet.

Maybe you ought to find out why the quote for you is so expensive.

[my4littlebuffaloes]

I second getting a second opinion on the hearing aids, when you have the cash to pay for them. I would tackle the collections and then the IRS first before anything else. You don't have monthly debt payments listed in your budget. Making a more exact budget would help you see what is really left over each month and help you come up with a plan of action. Good luck!

[dancemommy]

FYI- Everyone seems more concerned with IRS over everything else. While paying the IRS is very important, as long as you make on time regular payments you should be fine. We are self employed and have underpaid before and needed to make payments. Have had no issues doing so. I even missed a payment once due to a hardship and called them and they were fine. Good luck!!

[mndtrp]

You can find a house for less than $600 a month? Including utilities, repairs, landscaping tools and upkeep, insurance, and taxes? This would greatly surprise me, but congratulations if so.

Personally, I would continue renting, and pay off all debts, except maybe the student loan. Considering how much extra you have a month, just get rid of them, and then start saving for the down payment.

In order, how I would allocate any EXTRA money you have each month. All debts and bills are kept current, all extra money goes into the category until that category is complete.

Emergency Fund
Car repairs
Collections
IRS
HSBC
Hearing Aids (unless it is imperative you get them now, but look for something cheaper no matter when)
House down payment

I could waffle between paying off the student loan or getting the house, but would probably lean towards the down payment on the house.

[227melissa]

Don't feel bad we all have screwed up at one time or another. I have paid off everything more than once and got right back in debt, but not this time. Older and a heck of a lot wiser !!!!!!!

[ladytoysdream]

You need to shop around for the hearing aids. Mine a few years ago, cost $ 2400 for the pair.

[rachelj]

Re: the hearing aids....

I think that a lot of it depends on the type of hearing loss that she has. My daughter's hearing aids are about $5K due to the fact that they are the best (or one of the best) for high frequency hearing loss. From what I understand they do cost more than others....

Cricketlegs - could I pm you some questions about dhh stuff?