can't win

[newresolve]

I know this happens to everyone, but it's frustrating me.

It's my second month of determined budgeting and *sticking* to it, and I've been doing well. But it seems like there is always something that comes up to wreck it. For example, last month I accidentally blew a tire--had to replace both front ones for $200.

This month was going well until today--something is wrong with my dog and I'm going to have vet bills.

How can I get ahead when life constantly throws this stuff at me???

I don't have an emergency fund because all my extra money goes to debt payment... so I'll have to put the vet bill on my visa, which is exactly what I *don't* want to do. There is nowhere else in my budget that can give... it's very simple and includes only necessities.

The only thing that I could possibly put off until next month is my car's scheduled maintenance... but I am already way behind on that.

anyway... not looking for any answers, just needed to vent!

[FrugalMomof3]

Sorry to hear about these "things" popping up but I am sure it will die down soon and you can stop worrying.

[Odilia]

It IS so tough! I'm sorry life keeps throwing things at you. You're on the right track, and there is light at the end of the tunnel. Most (if not all) of us have been there.

[frooz]

Could you only pay minimum payments on your debt so that you can start an emergency fund? Or sell something you own so you could start one that way?
It is very frustrating when these things happen. We have been having the same problems with emergencies and moving costs and sometimes you just want to cry.

[my4littlebuffaloes]

You need to focus on an emergency fund for a few months. Then focus on debt repayment. The key to getting out of debt is to not take on more debt. You need an EF in place to avoid taking on more debt. I am sorry things like this keep happening! I know how it goes and it is very discouraging. Good luck!

[jamie79]

I agree. Get a start on a baby emergency fund of $1000. Then focus on the debt. While doing the baby fund send the minimum to the debt,

[newresolve]

You need to focus on an emergency fund for a few months. Then focus on debt repayment. The key to getting out of debt is to not take on more debt. You need an EF in place to avoid taking on more debt. I am sorry things like this keep happening! I know how it goes and it is very discouraging. Good luck!

but that's not logical--if I am putting money in a bank account instead of into my debt reduction, then I am paying more interest on my debt than I have to, and earning very little interest for the savings. I'm better off, mathematically, to put as much as possible into the debt, therefore paying less interest, even if that means putting emergencies onto the card.

[frooz]

But if you pay for emergencies on credit card you're just adding to your interest anyway

[justpeachy92]

The reason for the emergency fund is so that you aren't adding to your debt everytime something comes up. You will never have the debt paid off if you are always charging something to it. Your right having a couple of hundred sitting in a savings account doesn't collect much interest, but how much interest do you pay when you charge $200 for tires on your car. I am assuming because you are trying to get out of debt you aren't able to pay your credit card bill in full. If you put $200 on a credit card, and your interest is 18% (the average interest on credit cards across the country) making minimum payments it will take you over a year to pay that off. Your monthly interest charges will be around $24 a month...a year of those interest charges will be around $288. So your tires on credit will cost you around $488......in my opionion having the $200 in an emergency fund to cover the cost of the tires sounds so much better and you could put the money you are saving in interest to the credit card company back in your EF to fund the next emergency that comes along.

[chatterweb]

but that's not logical--if I am putting money in a bank account instead of into my debt reduction, then I am paying more interest on my debt than I have to, and earning very little interest for the savings. I'm better off, mathematically, to put as much as possible into the debt, therefore paying less interest, even if that means putting emergencies onto the card.

Yes, always pay high interest debt off before saving money.

I agree.

Is there any way you can get the credit card companies to give you a rate reduction??

I would call them and ask.

Also, can you be added as an Authorized User to a family member's credit card, only to boost your score? Otherwise known as "piggybacking"
^^^ The above will be outlawed in September07.^^^

Then after a while, you will get better offers on credit cards for lower interest rates...

[newresolve]

Yes, always pay high interest debt off before saving money.

I agree.

Is there any way you can get the credit card companies to give you a rate reduction??

I would call them and ask.

Also, can you be added as an Authorized User to a family member's credit card, only to boost your score? Otherwise known as "piggybacking"
^^^ The above will be outlawed in September07.^^^

Then after a while, you will get better offers on credit cards for lower interest rates...

I've applied for a lower interest card... waiting for the response. I called my current company to see if they could give me a better deal and they couldn't, which is stupid because I've had that card for 10 years.

[newresolve]

The reason for the emergency fund is so that you aren't adding to your debt everytime something comes up. You will never have the debt paid off if you are always charging something to it. Your right having a couple of hundred sitting in a savings account doesn't collect much interest, but how much interest do you pay when you charge $200 for tires on your car. I am assuming because you are trying to get out of debt you aren't able to pay your credit card bill in full. If you put $200 on a credit card, and your interest is 18% (the average interest on credit cards across the country) making minimum payments it will take you over a year to pay that off. Your monthly interest charges will be around $24 a month...a year of those interest charges will be around $288. So your tires on credit will cost you around $488......in my opionion having the $200 in an emergency fund to cover the cost of the tires sounds so much better and you could put the money you are saving in interest to the credit card company back in your EF to fund the next emergency that comes along.

Right, but that's not taking into account the debt that I *already* have, which is already collecting interest. I need to pay off as much as possible in order to reduce my interest payments. There's no sense having money sitting in an account doing nothing just in case something comes up--when the interest payments are definitely adding up every month.

[Its_Donna]

I'm a Dave Ramsey follower and when we where getting out of debt we followed his Baby Steps.....it seems that when you do not have an EF...that's when Murphy moves into your house.

While getting your emergency fund built up pay the minimums on your CC's. Once you have the Cash for the unexpected you can STOP using those cards and then start to snowball them until they are paid off.

Good Luck to you.

[justpeachy92]

"Yes I realize that you already have other debt to pay off, but if you spend any time researching tips on how to become debt free.....listed in almost every article you read it will say not to acquire anymore debt. The only way you can do that is to have a plan for emergencies so when something comes up you have the cash to pay for it. We are not saying not to pay on your debt to establish an EF, but lets say your current budget is allowing for you to pay $100 more a month over the min payment on your card, pay an extra $50 on the card and put $50 in savings to start and emergency fund. In a year you will have access to $1000 in cash to cover an unexpected expense like tires on a car, vet visit, etc. After you have $1000 in the bank or even just $500 you can then start using that $50 towards the credit card again. Whenever you use money from the EF, then split the extra you are paying on the credit card again.

[Buckeye5]

You need to have $1000 in an Emergency Fund. It is about earning $ on the fund at this point it is about being prepared for the tires that blow out, the unexpected vet bill, etc. Emergencies that can cost you $$, it also will give you a bit of mental security knowing that you have the $$ in place for the tires that blow etc. This is the first step to becoming debt free. When most people use their credit cards and have no EF that credit card does not get paid in full, therefore you are taking on new debt. Youreally need to get the Ef in place first, just try it, and see.