I am supposed to be so smart as an engineer...?

Question

I have spent many years in school to get my engineering degree, and now I am about to move up the ladder to another company as a director of engineering with almost double my current pay. I hate to spend my companies money, and use the companies $$ wisely...

Yet, beyond my 401K, I seem to be a financial disaster...late CC payments, etc, which is incredibly stupid.

Where should I really start to get a grip on reality of my OWN finances, especially now that I am going into a 6 figure income, and I want more to show for it than just stuff.

I need help!

Answer 1

You need to sit down and make a list of all your monthly bills that don't change. Rent/mortgage, car note, insurance, etc. Then estimate your variable bills like utilities, gas, food, etc. Subtract these from your monthly income. What you have left over is BILL PAYING MONEY. Divide this number by two and that will tell you how much money you should put towards those CC payments at EACH paycheck. Don't just pay those cards once a month. Pay them every time you get paid! This will reduce the interest charges you incur, as well as increase your credit score because you have a lower revolving balance. The faster you pay it down the better off you will be. Once you get that under control, set a limitation on yourself. Never put more charges on that card than the extra money left after bills that you calculated earlier. I know this sounds tedious, but will some discipline you'll get the hang of it and it will be like second nature after a while. Pay down the bills with the highest interest rate the fastest, but don't ignore the other ones. Have fun with it and mark your paydays on your calendar ahead of time to remind yourself to pay those bills! I started doing this almost a year ago and my credit score is now 740. I started at 640! Every time you want to buy something unneccessary and charge it, just think about how much better off you'll be if you maybe wait a while until you can afford to pay cash for that same item.

Answer 2

Actually , you're not alone. Many people with high paying jobs get into debt. Go to www.DaveRamsey.com. He has a pod-cast you can listen to his radio show for free and he has a good book called "the total money makeover." It's a good read and shows you how to get a handle on all your debt.