Face to Face with Debt

**sinopa27** · 11-25-2009, 01:39 AM

Hello my dear FV friends!
Well, I got my signature with all my debts listed. I am starting today to Face my debt. I, Sinopa, am in debt. I no longer want to be in debt. I hate all this debt. I don't want to be a slave to debt. Thus, I will stop adding to my debt and do what I can to reduce my debt.
WHEW!!!!!

I want to do the Baby Steps by Dave Ramsey.

*signature has debts*

**frugalwarrior2** · 11-25-2009, 01:52 AM

Start you timeline and begin chipping away. First congratulate yourself for coming clean. Also make sure you plan out a budget and plug any lekas like bank fees and unplug electric. Plan a menu and organize to free up more. Then pay off and snowball just make sure you build a baby EF first. Good luck.

**sinopa27** · 11-25-2009, 02:02 AM

I don't know where to begin! I know I feel better just admitting that I am in debt. I am looking for lots of ideas and encouragement.

**Siebrie** · 11-25-2009, 04:20 AM

I don't follow the Dave Ramsey programme (no debt), but basically, if I remember correctly, you pay minimums on all your debts, build a $ 1000 EF, and then pick 1 debt at which you throw ALL the excess money.

Keep paying minimums on the other debts. You can pick the debt with the highest interest, or with the lowest amount, or which you hate the most.

Once this is paid off, you throw the excess money + the minimum payment of the paid-off debt to the next debt.

**Greebo** · 11-25-2009, 06:07 AM

A detailed walkthrough of how to do the Dave Ramsey plan is here:
[ame=http://www.frugalvillage.com/forums/showthread.php?t=107294]Expanded Dave Ramsey Baby Steps[/ame]

These are the first things you need to do even before Baby Step 1:

0.1: Commit to NEVER borrow $$$ EVER for ANYTHING other than possibly a house.

0.2: Talk with spouse and get him/her on the same page as you concerning finances.

0.3 Do a written budget

0.4 Temporarily stop all retirement contributions

0.5 Get current on all the basics (You MUST have Shelter, Food, Utilities, Basic clothing)

0.6 Amputate "toys" (bikes, boats, ATV's etc) if they will keep you from completing the snowball within 12 months

0.7 Cut lifestyle (Cut CATV, Cellphone, Regular phone "extra's", Internet, Eating out, etc) and/or take second job if $1000 EF will take more than 30-90 days. (depending on income)

0.8 Get current on ALL bills

What kind of help do you need with those first steps? Often, I find that people need help working out a budget because a scary number of people have never ever really used one before.

**joyofsix** · 11-25-2009, 06:13 AM

Good job for admitting the problem. If Ramsey is your choice follow the steps listed above. It will work, but rather like weight loss. You didn't get in this mess overnight and you won't get out overnight. Your cc balances should be doable quickly after your EF. Good luck and keep us posted. It's scary but worth it.

**MaryCarney** · 11-25-2009, 07:14 AM

"The journey of 10,000 miles begins with a single step"
Congratulations on starting the journey. There will be bumps in road, but the keep you sights on the destination. All of us who are already there want as many people as possible to join us!

**ladykemma2** · 11-25-2009, 07:15 AM

you can do this. i paid off between roughly 8000 credit card bills from a divorce. my financial recovery took two years.

the kind people here told me to unplug everything. Go around your house and ask yourself - why is the sewing machine plugged in? why is the blender plugged in? then go to CVS or walgreens and buy power strips. i put them on the TV area and the microwave area. The computer area already had a surge protector. Become a power miser. "why are those lights on? why is "that" glowing? i saw an immediate savings of 100 a month by doing this.

then that summer, i turned my air conditioner to 78 and sucked it up for two consecutive summers. my summer houston texas bill went from roughly 400-500 a month to roughly 200 a month.

a good friend who was an accountant came over and she reviewed all my bills. she had been through a divorce too. she set up an excel spreadsheet budget with all my bills including those that were paid yearly. every month we set aside 1/12 of the bills in the account. she had me open a savings account to put those funds. She reviewed with me that i could no longer pick up the tab and other stuff. she taught me the newly divorced budget and strategies.

i turned off cable and cried all the way returning the boxes, cussing the exhusband. i bought one of those convertor boxes. replacement entertainment became listening to dave ramsey on th internet - the radio archives on his website - while i cleaned house or puttered.

i learned from FVers to meal plan, shop with a list and a calculator to keep a running total. i planned meatless meals almost everyday. (this was a mistake because i developed pernicious B-12 anemia) if i had to do over again, i would have had a better diet.

i stayed out of restaurants. i cooked at home and had intentional leftovers for lunch the next day. i planed meals to cascade: like roast chicken for sunday, chicken tacos for monday, chicken soup for tuesday...

i stopped using the dishwasher and carefully handwashed the dishes. i discovered that if i used the dishwasher my electricity bill jumped by 30 dollars.

i told the pets not to get sick.

i washed everything in cold and used half the detergent. hang to dry.

i didn't get my hair cut. i just put it into a chignon for two years.

i hope this helps. everybody's financial recovery is different!

**ladykemma2** · 11-25-2009, 07:33 AM

here is my budget now. it looks very different from when i first started.

monthly
elec
water
nat gas
lawn
gasoline
groceries/supplies
tithe/fast offering
prescription drugs
dining with friend
credit report
bundled service ATT
haircut
pocket money

sinking funds
escrow (taxes/ins)
trash
home maintenance
home owners association
flood insurance
termite contract
a/c heat maintenance
oil change
car maintenance
car insurance
car registration
car inspection
toll road tag
car replacement
endocrinologist
optometrist
dentist
co-pays
vet bills
tax prep
office max
stamps
xmas
school startup
shoes orthopedic
work holiday parties
travel summer

**nodmicks** · 11-25-2009, 07:40 AM

You did great taking the 1st step by admitting it and wanting to change! Yeah!!!!!! IF we could pay of $46,000 in non mortgage debt anyone can.

Get that baby emergency fund saved up while paying those bare minimums then follow the rest of the baby steps.

One thing that helped us a lot to save up the baby EF and cut costs was for me to read every book on frugality and cutting costs I could get my hands on.

**tervsforme** · 11-25-2009, 08:51 AM

Congratulations on taking the first step and wanting to take charge of your debt. You will find tons of tips and useful information, everything from cutting electricity, meal planning to making your own detergent. Start focusing on you BEF and you will be off and running! Great job!

**AnW819** · 11-25-2009, 08:58 AM

WTG

You can do it!

**sinopa27** · 11-25-2009, 11:00 AM

Originally Posted by Siebrie

I don't follow the Dave Ramsey programme (no debt), but basically, if I remember correctly, you pay minimums on all your debts, build a $ 1000 EF, and then pick 1 debt at which you throw ALL the excess money.

Keep paying minimums on the other debts. You can pick the debt with the highest interest, or with the lowest amount, or which you hate the most.

Once this is paid off, you throw the excess money + the minimum payment of the paid-off debt to the next debt.

If you didn't follow the Dave Ramsey program, what did you do?

**sinopa27** · 11-25-2009, 11:01 AM

Originally Posted by tervsforme

Congratulations on taking the first step and wanting to take charge of your debt. You will find tons of tips and useful information, everything from cutting electricity, meal planning to making your own detergent. Start focusing on you BEF and you will be off and running! Great job!

????Make my own detergent????????? For real???