Help me learn how to get out of debt

I know how scary debt is...we have just scratched our way out of $45,000, and it was not easy. We did the Dave Ramsey plan, which was amazing. He has the heart of a teacher, and doesn't just make you feel guilty. I saw some others say this but it is so important...House and utilities first and foremost! You have to have a place to live, and utilities are part of that. Sounds like you are starting to sell things that you can part with, and that is a great way to get started. We put our bills into a debt snowball, from smallest bill to largest...we didn't care if any were interest bearing in the beginning, we just wanted to get rid of any small ones we could, and that was a huge ego boost, which kept us going. Thanks to some medical issues, we still have a little ways to go, but we know how to handle it. If collectors call, just remember, they operate on fear, so don't let them bully you. You make sure you have food and shelter first, then bills...Good luck, and I know you can do this!!! Just take it one day at a time, one breath at a time, and one bill at a time...it gets better...

I was also gonna suggest Dave Ramsey. I've learned so much from his program. I got his book at the library and it helped.

I agree with everyone else that mentioned Dave Ramsey. He is great. You can get Total Money Makeover or Financial Peace from the library and it has all the info and worksheets you need.

If you really want to get rid of the 2nd car don't let it get repossessed. My mom did that with my ex step-father's truck because he stopped making payments. They auctioned it off and made her pay the difference. Dave suggests selling financed cars and getting a cheap clunker car that requires no payments or dealing with just 1 car.

One other thing I would suggest is if your income is really that low check with the hospital and see if you qualify for a low income discount, or see if you qualify for Medicaid and they will back pay up to 1year I think.

His best things that I use though are the emergency fund, debt snowball, and allocated spending plan. You don't need to deprive yourself, you just need to assign every dollar to something BEFORE you spend it. I actually converted his monthly allocated spending plan into a google spread sheet that I catered to my own categories.

The debt snowball is a great concept because when you get something completely paid off it motivates you to keep going as opposed to the highest interest plan which sometimes just puts little dents in something.

So you put all your debt down from lowest to highest. So for you $25/mon, $40/mon, $40/mon, 20/mon (just using the cc for the example.) Then you find any extra money you can to add to your $25/mon payment You pay everything you can on it until its paid off and just the min on the others. then you take that amt and add it to the next card which would have you pay at least $65/mon on that card, then $105 towards the 3rd card, etc etc until all the debt is gone.

He frowns upon financing of any kind even cars unless it is a home loan that you can afford and is fixed rate. He also repeated mentions not to fall prey to debt consolidation/credit repair companies.

Than you for all the responses!

I wanted to add that we do not have rent or utility bills or cell phone bills ( his mom lets us stay at her house that she has paid off for no rent because she is living with her boyfriend at his house)

so when it comes down to it:

c.c:$500.00 $40.00/month
c.c:$1000.00 $20.00/month
c.c:$800.00 $40.00/month
c.c:$500.00 $25.00/month
Hospital bills: $10,000.00 ( 3 different hospitals and different visits so we havent set up monthly payments yet)
Car 1:$8,000.00 $185.00/month
Car 2:$14,200.00 $310.00/month
Loan 1: $3,500.00 $98.00/month
Loan 2:$2,000.00 $73.00/month
Business: $130.00
Student loans: $3,500.00 ( no monthly payment for 6 more months)

PLUS gas and car insurance a month



C.C means credit card. I did not put who I owe just because this is the internet but I do not mind shoing what I owe if it helps me get a plan going lol.

I was wondering if it would be a good idea to not pay on one of the cars so it gets reposessed? Would that make the payment go away? Because then we wouldnt owe acar payment on it plus we can change our car insurance so it may go lower



Also me and hubby do not watch t.v unless its netflix but that is 8.00 a month so i guess that can go to!

I am putting in job applications everywhere! My husband wrks from 4 a.m to 11 or 1 p.m M,W, and F. I am going to go with him tomorrow (to save gas) and apply for jobs when places start opening.

If at all possible I really do not want to go through a consolodation place or anything like that. I dont mind calling the card companies but I dont want a third party agency involved.

As for TV, we haven't had TV for years. It started in an apt when our daughter was born because they wouldn't let us have satellite and they had made a deal with the cable company where we were only allowed to use that company and a special package that the apt came up with, very overpriced. When we rented my grandmothers house we had satellite for a couple years because hubby was making good money but then things went bad so we ditched it when we moved 2400 miles across country for a full time job. Now we use the antenna for prime time/pbs/qubo but even with that most of the prime time shows we watch we just watch online. Most stations now even have apps where you can watch their shows for free on your phone. We have plenty to watch when we want it and we have never had netflix. Every once in a while we get a movie from Redbox for $1. For the kids we let them get iCarly, Spongebob and other stuff like that from the library. If you have s-video ports or HDMI ports you can even spend $10 or less to get a cord to connect tv to your computer so you can watch it on a bigger screen. We also don't have a home phone just our cell phones.

I have found many differnet ways to start getting out of debt but I am not sure which ones work the best.

Short Story: Hubby and I have right under $45,000.00 in debt from credit cars, cars, medical bills, loans, and student loans. I lost my job and my husbands hours got cut to 20 a week. We cannot afford to pay everything off let alone make the minnimum payments.

SO Please!!! Help us by sharing what you have gone through or any advice you have for us.

Please do not just say stop spending money, etc. We have cut up all credit cards and we do not spend any monet on unneccesary things anymore.

We are genuinley in trouble and could use some helpful adivce!

We are young so we dont really care about messing up credit because once we are out of debt we could build it back up.

And we would like to try and save bankruptcy for a last resort because other people have cosigned a few things for us.

Thank you in advance!

Go to a NON PROFIT Credit Counseling Agency or Organization in your City! Make SURE it is a NON PROFIT funded by H.U.D or your City!!! Contact or go online to HUD or your City Directory or Google them. Also, contact United Way or Urban League if you have them in your City (ask for references for Budget and/or Credit Counseling.)

If it is NOT a Non-Profit it is probably a Rip Off!!!

Sell everything that isn't nailed down... become a one car family or sell them and get a cheap used car for now.... prepaid cell phone........ the library has computers you can use, shut all unnecessary things down. Ebay, Craigs list, Consignment shops, etc.

Look for anything that pays....... dog walking, babysitting, waitress etc. I cold called for funeral home plots one time. Find a call center, anything with a late night shift that pays double?

Call all the credit cards and talk them down. Call the student loans and see if you can skip a couple of months. I don't think you ever lose a student loan anymore not even in bankruptcy so I wouldn't consider that a huge priority..... asking to skip or half the payment for now might do the trick. Knock the highest interest item out first. Anything with low interest or fixed interest should be last.

can you move in with someone or get someone to pay part the rent where you are? Some people would love a temporary housing situation like 3 or 6 months without signing a lease.

I would be careful of those consolidation companies.... I have read bad things about them so do the research and check up on the company first.

Any family member you can "borrow" money from that won't demand it back right away?

would love that spread sheet!

Pm me your email and I'll send it when I get home.

If all else fails and you can't work out a solution with everyone you owe that fits what you can afford right now, it might be time to bite the bullet and file for bankruptcy... Not a pretty thing, as it will most certainly trash your credit for a good while. But, sometimes that's just what you've got to do. Best of luck to you and your husband.

I would (respectfully) have to completely disagree here. For as little debt (relatively) that you owe, it's not worth having a bankruptcy on your report for 7+ years. I would rather have a $300 credit card that I would be able to pay off later on my credit report. I've paid of credit cards years later and they just have a 0 balance now. Not bad, not good.

It takes a lot of little things, but over a year all the little things add up to one big thing.

Yes this exactly. When hubby was 21 his truck got repossessed and he had a couple credit cards and some medical bills that were on his credit report and he was suggested to file for bankruptcy. It went through and everything got cleared and its just the bankruptcy on his credit instead of the repo. In the long run it would have just been more beneficial for him to take the hit on the truck and pay the difference they wanted after the auction and budget for the cc's and talk to the hospital then it was to get the bankruptcy. That one thing on his credit really hurts our ability to do or apply for certain things a problem. Even apartments have had problems with it in the past and wouldn't accept us. For such a small amount it is definitely not worth the bankruptcy. Even if all of her cards got charged off and sent to collections that is 2-3yrs bad rep max and then they go away. But with all of her necessities like living space and utilities covered there should be no reason for that step.

LOVE Dave Ramsey!!!!!!

Best quote ever:

"We buy things we dont need, with money we dont have, to impress people we dont like"

Everyone of your advice that I read was good advice. But what I did along with NO T.V., Cell Phone etc.. I paid the bill with the lowest balance a little more (the most that I could) and the rest was minimum balance. One by one. I wanted to keep my Visa so I made sure I paid that on time.But I agree with the two jobs each.

I've not read all the replies but I wanted to post and congratulate you on looking at this sensibly and logically and not burying your head in the sand.

You'll go a long way

And I'm saying this having just found out my 19year old nephew has just got fired for stealing money and is currently locked up in jail in a foreign country, more than likely awaiting deportation. He could learn a lot from you! (or at least I think that's the case, I'm hoping it's a cruel joke being played by his mates on his facebook page until we can find out the truth!)