I need some advice(newby here)

**kentuckyguy** · 01-06-2006, 10:15 AM

I am recently divorced and have custody of my two children ages 8 and 11. I just bought a house and have been in it for about 4 months now. I aquired the credit card debt from the divorce but was able to keep all my 401K and pension plan.

Here is my question -

My debts are:

Credit cards aprox - $9000

Legal bills - $500 (can make interest free payments)

Medical bills - $200 (can make interest free payments)

Because of my new tax status I will be getting back $4500.

I will be needing a riding mower and my car(94 Honda Accord) has 325,000 miles on it and my truck(96 Chevy 4x4) has 120,000.

What should I do with the $4500 tax return?

**homesteadmamma** · 01-06-2006, 10:17 AM

If it was me, I would put $1,000 into an EF account and the rest I would put towards my debt. The quicker you get rid of debt, the quicker you can start saving for a new vehicle and possibly pay cash for it.

**kentuckyguy** · 01-06-2006, 10:19 AM

EF account?

**tbs727** · 01-06-2006, 10:23 AM

Emergency fund

**homesteadmamma** · 01-06-2006, 10:23 AM

An EF account is an Emergency Fund account.

**kentuckyguy** · 01-06-2006, 10:33 AM

ok

**canadian gardener** · 01-06-2006, 10:46 AM

Welcome to the gang Kentucky guy, hope you enjoy the company and find some new tips and techniques and maybe swap some of your good tips too.

**SewCrafty** · 01-06-2006, 12:31 PM

Welcome to the village Kentucky guy!

Look into some of the older threads, you will find a wealth of information and don't forget to check out "The Shed" it's where our male members hang out when they get overwhelmed by us women!

**kentuckyguy** · 01-06-2006, 01:13 PM

Originally posted by SewCrafty
Welcome to the village Kentucky guy!

Look into some of the older threads, you will find a wealth of information and don't forget to check out "The Shed" it's where our male members hang out when they get overwhelmed by us women!

Thank you!

My sister is also a breast cancer survivor for two years!

**Jerseygirl** · 01-06-2006, 01:18 PM

Depending on how much is typically left over at the end of each month, I would agree that at least $1,000 should be set aside for emergency, then uses the rest to pay down debt with interest. Even if you eventually need to make a car loan, the interest will still be lower than cc.

**Kimberlina** · 01-06-2006, 01:20 PM

I agree- I would put $1000 aside for emergencies, such as making necessary repairs to one of the vehicles to keep it running, then put the rest toward debt. You can even buy a car for $1000 if you need to.

As Dee said, check out the past posts, and then I also suggest listening to Dave Ramsey. www.daveramsey.com If you can't find a local station with a schedule that fits, you can listen to the program for free at his website.

Good luck!

**MandiDawn** · 01-06-2006, 03:31 PM

ok - if it was me, I would do this:

$1000 - emergency fund, so you can handle all the little things that pop up in life.

You have $3500 left

$1000 - riding lawnmower - check all the sales ads, try to find a good used one.

You have $2500 left.

Pay off your legal bill of $500.

You have $2000 left

Pay off your medical bill of $200

You have $1800 left,

Put all that on your debt of $9000 - so your new debt is $7200.

Then you can snowball (put all your money) towards that one debt.

**webjoba** · 01-06-2006, 03:46 PM

I agree with MandiDawn - spread it around in the way she suggests and keep hold of $1,000 for those unexpected emergencies!

You will soon be on your way to becoming debtfree.

BTW - welcome to the Village

**Darlene** · 01-06-2006, 03:49 PM

Got all kinds of good info, just want to welcome you to the Village.

**webjoba** · 01-06-2006, 03:53 PM

I agree with MandiDawn - spread it around in the way she suggests and keep hold of $1,000 for those unexpected emergencies!

You will soon be on your way to becoming debtfree.

BTW - welcome to the Village