Can I get a realistic answer for getting out of debt?

Question

I have read and listened to numerous "get of debt" solutions. Are these books for real? The rolling affect of once a credit card is paid off put that payment on the next credit card and so forth? We currently have a $12,000 personal loan that is 21% interest. Our payment is $316 a month but they take out $298 every month in insurance and interest. How are we supposed to get out of this loan if our payment is always taken out from underneath us? We are a one income family. I am also wanting to find some income but haven't had success in finding a NO SCAM stay at home job. Even the ones that were posted to my question a couple of days ago seem shady to me. So....please we are needing some relief before we go under financially with four kids! Help! Any other money saving/earning suggestions? Thanks soooo much!

Just for the record.....we don't use the credit cards any more...cut those babies up long ago. We are trying really hard to make the payments on all loans/cards. We pay extra when we can. We also don't want our credit hit again due to the fact we want to move soon. Credit score will drop with each hit. So, refi is out of the question. Credit counseling is a no go as well....damaging to credit in the end. We haven't had a late pay in 14 months but want to get ahead, ya know? We only have $27,000 debt (I say only because that is below the ave of most people) however, it's above our means.

Answer 1

If you only pay the minimum payment on that card - it will take you 60 years to get out of debt.

You HAVE to pay more than the minimum.

DO NOT use credit for purchases - if you don't have the money at hand, don't spend it.

Go to the library, and pick up a copy of The Complete Tightwad Gazette. It is a virtual encyclopedia of how to SPEND LESS in all aspects of your life. You need to spend less, pay off your debt faster, to get out of debt.

Pay the biggest payments to whatever debtor charges youthe most interest.

Answer 2

Hi there,

With all paying of debt situations i would normally suggest starting by paying of the debt with the highest interest rate then when that's done putting those payments onto the debt with the next highest interest rate.

e.g. if you've paying $100 a week on a credit card at 15% interest and $150 a week on a car loan at 12% interest. Then you pay of the credit card and as soon as this is paid you put the extra $100 dollars a week onto the car loan so that your now paying $250 a week.

This normally takes some time to get going with the first loan but as soon as you pay that one off it starts snowballing and getting quicker and quicker. Most people have the problem when the first debt is paid off they aren't diciplined enough to put all that money on the second loan. I have personally done this before and it's hard to make yourself do it.

In your case because you really can't get ahead on the personal loan, even if it has the highest interest rate i would start with another debt that you can get ahead with and then as soon as 1 or 2 of those smaller ones are done put the extra money onto the personal loan.

I'm not sure what country your in but you may also look at refinancing the personal loan to a lower interest rate if possible or if you own a house refinancing that to include the personal loan.

Please don't take any of this advice as financial advice and telling you what you should do, this is just what i have done in the past that has worked for me. You have to go and see a professional to get some independant finance advice to suit your situation. What i talk about above worked for me in australia but it may be different in other countries.

As far as earning extra income I have found through many peoples advice and my own experience that the best way to be financially secure (passive income = more than expences) or to have a good part time job that doesn't require too much effort, is to build up MSI's (Multiple Sources of Income)'s

This is specially important in your case because you want any work your involved in to not take away too much time from you studies.

Most internet business's require a large amount of time but very little if any start up capital which is why i chose to start in this field.

My latest project that i have been working on and that may be highly useful to you is



www.agloco.com.au




This is a new Online company that is 100% Free (they will never ever charge you a cent) and they distribute all their revenue from the their advertising profits to their members and they are even distributing their shares in the company to the members.

It takes 2 mins to sign up and then after that they will pay you to have a small toolbar on you web browser that presents very discrete and content appropriate adds to you.

This means after your initial 2 min sign up process they will pay you for doing nothing. The added bonus is that if you like you can also sign up and recomend other members to sign up and then you will also get paid a portion of their hours.

It could be a huge thing or it could be a small thing but just remember.

It's 100% free, so there is nothing to lose.

Other MSI's that i would recommend looking into are:

Selling on Ebay
Ghost writing or copywrighting on sites such as www.elance.com
You can also do web design and graphic artist work on elance.
writing your own e-books
completeing paid surveys
online mystery shopper
Online Data Entry

For more great advice and ideas i would recomend checking out www.warriorforum.com


Cheers, ToNy!

.....Always seek proper financial advice from a proffesional in your own country that can assess your individual situation........

Answer 3

The rollover is the best way to do it. It's recommended by Carolyn White, Garrett Sutton, and Charles Givens as well as many other financial seminars I've been to. It works...I'm doing it personally. It's a little rough to commit to but I see it working.

As for extra money, I'm with SFI. It is free to join and has tons of products and services. If you or your wife are creative, I suggest you focus on selling the website/hosting packages they offer to small businesses in your area. This is my focus. I've found that most businesses don't want to build a site even with how easy it is. They come with sitebuilders but the people don't want to take the time to do it. I offer to do it for $99 for a 3 page site and $30 per extra page...which is very cheap in my area.

Last month I made $600 designing websites plus the commissions I'll get each month from the hosting. I work at this...not hard...but I work at it. I have 3 kids and the youngest goes with me to the businesses when I approach them.

You can also save on expenses that you might not have thought about.There are some very affordable long distance rates, internet services, etc...

Answer 4

As trite as it sounds..you probably didn't get in debt overnight and you won't get out overnight either...sounds like you are trying all you can..the rolling effect for credit cards does work if you can be disciplined about putting the paid off payment on the next card...don't think .....'just this one month' ...of missing the doubled payment. For stay at home work..can you do daycare of even one extra child? cash and no investment in car, clothes and work expenses...also there is an on-line company called West.com that is not a scam...you answer telephone call ins for several companies or take orders on line...no investment except a phone without caller id or call waiting....mostly need nights and weekends

Answer 5

Can you refinance this loan to lower-interest paying one? If not, you would have to make larger payments in order to get rid of it sooner. And in order to make larger payments then you need to earn more income. Then why not simply start by selling on ebay. To begin with, find some items lying around the house or garage that could easily turn into cash. It's free to register and just a few small selling fees to get started. Then from there you can look through close-out stores, flea markets or from a hobby like making candles. You can also buy in small lots from wholesalers on ebay that you can re-sell. Before you know it you can be earning extra income per month to pay off your debts. Browse through the articles on this site to get more helpful ideas: http://www.besthomebizfinder.com

Answer 6

Have you tried refinancing the loan at 21% down to a lower rate? Check with some area banks and credit unions.

As far as stay-at-home jobs, is there anyone in your neighborhood that is paying for daycare?

You may want to try a credit counseling service that can work with your creditors to establish a payment plan that works for your situation.

Answer 7

First let me say there is a good book on the "Money" page at http://godisruleroftheuniverse.com which can be downloaded for free. The beginning of the book is all about budgets and getting out of debt, the middle of the book is about creating extra cash flow. The book is Rocket to Riches. Excellent guide for what you need.

Alot of good tips can be found at:
http://www.kiplinger.com/magazine/contents.html
and http://suzeorman.com

Also, for working at home, just do a search on search engines using the words "telecommute jobs". This will also turn up extra real paying jobs that can be done at home.

Answer 8

I would take the debt that is the oldest, then the one that is the biggest and start paying that off. If your looking to save, try a liquid CD with a high interest rate. If you take the $ out before it matures, you get charged. Dont touch that $ and consider consulting a credit counselor.

Answer 9

Sybil,

Work from home jobs are scams. The only way to get one is to get a job and negotiate a telecommute work schedule.

Second, regarding your loan, get a 0% interest on balance transfers card and move as much of the balance over as you can.

I swear by those.

Answer 10

marykay or avon? (neither of those would personally work for me but I have seen a few pink caddies in my day to know that they work for someone)

I am not sure how old your kids are but if they are school aged, is there anyway you could work around school?

If they are younger, why not advertise and take in another child or two for a parent who does work.
Your kids would love the new friends and the other parent would love the peace of mind that comes from having a child in a HOME rather than a daycare.
If you were to charge a mere $50.00 a week you would have over $400.00 a month.
Be sure that the ages of the kids are compatiable ages with your own kids to make the transistion a smooth one.
I would opt against a baby or charge way more to keep one.
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A paper route might be a decent solution if your kids are NOT school aged. If you dont mind getting up, you can pack them in the car and go deliever the papers without having them have to leave your warm car. A small route can net you about $200 or so a month. If your husband works late, you can go and be back home before he is ready to leave for work.
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Since you have 4 kids, you obviously know how to spot a bargin, what about instead of throwing away the old toys your kids no longer play with, why not sell them on ebay?
sure you wont get rich but if you sell your daughters old doll house for $50.00, that is $50.00 less that you have to spend for xmas.

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Speaking of Christmas,

Why not start your xmas shopping now.
This is a great time to pick up winter coats and put them away for next year. Same with gloves hats and mittens. Nearly every winter item is 50 to 75% off now.
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It might be a bit hard to pick up toys to put away for xmas since none of us know what will be the new hot toy for the next year but this might be a great time to pick up a few puzzles or other stocking stuffers too.
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My wife found some awesome things for my kids and for my niece and nephew from second hand shops.
Granted this is not very practical for teenagers but for a child from about 4 months to 5 or 6 years, it is a great way to get nice clothing at a fraction of the cost.
She has purchased Tommy HIlfiger and Polo clothing in excellent condition (probably bought by grandmothers) and it is cheaper than new stuff from walmart.
She recently purchased 8 shirts for $20.00.
what they dont like, she sells on ebay.
She never gets rich from it but it usually pays for her "habit".
During the spring and summer, be sure to get up early and check out a few garage sales.
They are goldminds for things that are slightly used at a fraction of the retail price.
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Does your husband work a traditional job?
If not, maybe you can put your name on the list to subsitute teach.
In our state the requirements are not that tough and the pay is about $70.00 a day. The school will call you early in the morning if there is a need and you can let them know if you can work that day or not.

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Every thought about giving blood?
Okay it does not sound all that romantic but when I was in school we used to do it all the time. We could earn as much as $250.00 a month for about 5 hours of 'work'. The best part of it was that we were helping to save lives. (If you go early in the morning you miss all of the homeless people). You can go when your husband is home and you can go give blood (or plasma) and be home within the hour (after the first time). YOu get paid on the spot!

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Have you looked over your bills?
Maybe you could switch your phone service to your internet and save $50.00 or so bucks a year.
Check and compare your car and homeowner's insurance policies. If you increase your deductible (from $50.00 to maybe $250) your rates can go down quite a bit. Also there is a small discount for having your car and homeowners on the same policy.
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Dont know if you have cable but if you do (we need it for basic reception) do you need 15 HBO stations and 400 channels?
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Do you make a list when you go to the grocery store? Leave the kids at home when you go so you dont have to spend an extra $20.00 buying Toney the tiger frosted flakes when they dont know the difference between that and the generic brand.
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are you a member of sams club or costco.
Buying in bulk can be a huge savings on items like laundry detergent and canned vegatables.
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A pay as you go cellphone could trim your cellphone budget a great deal while still allowing you emergency access to a phone. Walmart has the 10-10-10 plan.
the phone is $40.00 and comes with 300 minutes that are good for two months.
the minutes will carry over if you buy another card every two months ($30.00) or you can buy one card for $150.00 that will last you six months or a one time $300.00 that will last you for a full year and 3k minutes
Obviously dont cancel a contract to get this but if you are at the end of a contract, it might be a good idea to end it and go without the hassle of a monthly contract.
That is about all I can think of right now.