I said, “Goodbye” to my daughter yesterday. Leaving her on the doorsteps of college, as I drove, sobbing away. I know we gave her a good start and I take comfort in that. Even through the tears of a chapter in our lives being over, I am aware a new, exciting one is beginning for her. And with only two children left in the nest, and years ticking away, a new chapter is upon me as well. I’ve done little to prepare for retirement, given the decades of financial ups (and mostly downs) in my world. I am tired of riding the debt roller coaster. I also want to buy a home.
Many of you might be in the same fiscal land, where 401K’s and portfolios are impossible imaginings. Survival is where you’ve been living and it’s not a happy place. I don’t want to eat cat food when I’m 80, nor wait to drink coffee for Seniors day at McDonalds. It’s time I started moving rapidly from where I am to where I need to be.
I’ve spent nearly a week struggling with a livable budget. I have roughly $24K in medical bills, to over 14 creditors. I also have 3K in a car loan from my totaled vehicle owing (the cost of loans when you have poor credit, high interest loans and no gap insurance to pay the loan off).
At present I had been smattering money at creditors, paying without a plan. I’ve just talked to all my creditors, and developed payment arrangements. None of my debts have interest accumulating. (Even the car loan interest was stopped after some bartering post accident). With 16 total creditors, I never see any progress. It gets depressing for me.
My new revised plan is to lop a few bucks a month on the youngest child’s cell phone, by using a prepaid phone with unlimited texting (saving $50.00 a month). For some of my college kids, their cell is their only phone, which means keeping Sprint’s unlimited minutes versus switching to a prepaid phone, is still the best fiscal choice for them.
On my new plan, I am getting a Secured Credit card (Wired Plastic Pre Paid Visa) that gives points toward prepaid phone minutes. I will use it for paying most, if not all of my bills. The points earned, will purchase minutes for the prepaid phone. So I not only will save $50.00, by switching from Sprint, I actually will earn money toward phone use.
My monthly expenses are as follows:
| EXPENSE | CURRENT AMOUNT PAID | Revision |
| Rent, gas for car, all utilities including internet, trash, city water, power, cell, and car insurance | $1,600.00 (I insure all my kids’ cars through college and pay three kids’ cell phones) | $1,550.00(Saving $50.00 from cell phone)To Apply to debt- $50.00 |
| Food for 3-4 humans monthly (quantity depends on college kids staying over) | $400.00 (Yes, I really use coupons and rebates) | |
| Haircuts, clothing, misc. | $100.00 (not bad for a household of up to four females. Most of us buy consignment, clearance or Goodwill) | |
| College assistance for kid(s) | $100.00 (I pay college kids textbook fees, though children cover tuition via grants, scholarships and student loans) | |
| Entertainment | $100.00 (also includes movies, school activities, games, misc. field trips, school supplies, etc for remaining two children at home) | $60.00 (By purchasing two season sports passes for my girls to attend all high school games all year, I’ve shaved off nearly $40.00 a month) To apply toward debt- $40.00 |
| Medical bills/debt | 350.00 | New amount to apply toward debt $445.00 |
| My student loans | $70.00 | |
| Savings | $100.00 |
The previous $350 amount I’ve been paying means that it would be about 6.4 years before I would be debt free. By then, I will be 50. With the revised amount of $445.00, this means that I have 5.5 years toward paying off my 27k of debt.
However, that is at my present income. If I earn an extra $200 a month that I can apply toward the debt hanging over my head, I’m looking at paying this off in 3.5 years. As I am a writer, it’s a viable option to pick up extra work.
I don’t think I can cut more without cutting help for my kids. They come from an economically disadvantaged family, due to all my health and post cancer issues. And they each have jobs to pay for everything else but the textbooks, car insurance and cell phones. As they grow older, I pick up less of the tab. Though my son is in college still, all I pay for him is his car insurance and textbooks. My oldest daughter is a college grad, paying her own way. They each will graduate with around 50K or more in student loans, which is why I do try to help them now as much as I can.
If I can buy a home in three years, I will drop my housing costs by a half. It’s pricey to rent in my town. The cheapest decent three bedroom place is around $750-$1,200.00. Were I to buy a home, my house payment would be far less. If I were to pay this debt off and buy a home in three years, I’d be disciplined enough by then to apply the money I am now paying creditors to savings or investments. I’d still be young enough, at 47, to save money over a twenty year period and have a nest egg for retirement. If I could do this, (without figuring interest), I’d have socked away $156,000.00 toward my golden years.
I am negotiating with some of the larger creditors to take less a month, with the promise I will pay more as I pay off the smaller bills. Using this snowball effect, and hopefully gaining some extra income, I am striving to make greater headway. At least seeing it on paper, makes it a goal, with a time frame. It’s still a long haul, but there’s light at the end of the tunnel. I encourage you to make a budget or post a comment about your budgeting experiences.
2 Comments
Dateline NBC aired a very interesting episode on it’ s Friday edition of the show entitled“ Inside the Financial Fiasco”. Friday’ s episode pertained to the tactics and practices of the debt collection industry. Dateline NBC conducted some undercover investigations of debt collectors. I found the tactics of these debt collectors to be beyond abusive and harassing. In my opinion, the tactics used by the debt collectors portrayed in this episode were fraudulent and criminal.
Debt collectors? Hmm. Yes, many of them have treated me like a criminal as well, as acting criminal themselves- however, I’ve had success with sharing my story with them, telling them I realize they have a horrible job, they must hate as much as I hate talking to debt collectors… etc. Sometimes they soften, other episodes have reduced me to tears or anger…If I were buying new living room furniture or taking trips to Vegas to gamble all my money away, I’d see… but jeeze? medical bills should NOT cost you so much stress later… not at all. I also despise Pharmacutical reps.. too glib, too slick and at least in part why all our prescriptions cost so much. Even thought they “legally” are not allowed anymore to pay doctors or wine and dine them in exchange for “special favors” in recommending products, they do so quite dishonestly… very much so. Tickets to Cubs games, suddenly are “found and donated” to an orthopedic doc I know by a rep. His office, “won” a gift certificate to an exclusive restaurant. etc. Wanna know why your meds are so high? Start with the pharmacutical companies. There is NO way it costs $1,000.00 a day for some drugs I’ve taken. ( I suspect if you scrutinzed drug companies budgets you’ll find lots of room for perks)… By the way, by virtue of a bill collector getting their job, 99.9 pecent of them have passed a credit check- they may not have a clue what many of us with poor credit go through. I’ve educated a few and even sent them copies of my check stubs, and bills. ( I once sent a 144 page fax from my office, of the entire medical bill bankruptcy to a disbelieving bill collector… I never heard from them again)…
)
3 Trackbacks
[...] Bankrupt: Leanne shares her story of how she is planning to address her debt load. She owes quite a bit of money to over 14 creditors through medical bills and a car loan. [...]
[...] A tiny glimmer at the end of the debt tunnel | Mrs Bankrupt http://www.mrsbankrupt.com/a-tiny-glimmer-at-the-end-of-the-debt-tunnel – view page – cached My Journey through Bankruptcy, I said, “Goodbye” to my daughter yesterday. Leaving her on the doorsteps of college, as I drove, sobbing away. I know we gave her a good start and I take — From the page [...]
[...] Mrs. Bankrupt spots a tiny glimmer at the end of the debt tunnel. [...]