Next challenge:

[jamethiel]

Hi Guys! The next challenge is:

FIND OUT WHAT YOUR DEBT IS.

Do you know off the top of your head what your debt is? In spite of my anal-retentiveness about tracking my money, I actually don't. I mean, the credit card, yes, but then I thought about it.

I have two other debts. My HELP debt (higher education loans program debt. I'm not going to worry about this one at this stage. It doesn't affect your credit rating and is garnished automatically from your salary when you reach a certain threshhold. Maybe after I've gotten rid of the other sorts of debt.)

The other debt is the rent for my computer. This is a stupid debt.

Look, at the time I had no money and no prospect of ever getting a computer otherwise. And they said "It's only $111.56 a month!"

What they don't stress (it was there in the small print but I was taken in by the advertising) is that the loan period is 4 years. Making it so that by the time I have paid it out, I will have paid TWICE the cost of the computer in interest. It's barefaced robbery--I would have been far better off going to the bank and getting a loan. Also, I'm still paying for a laptop that's increasingly unreliable and will be worth NOTHING by the time I've paid it off. I broke one of the cardinal rules of finance: If you can possibly avoid it, NEVER TAKE A LOAN FOR SOMETHING THAT DECLINES IN VALUE. (I think the word I'm looking for is depreciates, but I'm not sure so declines it is for now). This includes cars, stereos and any of the other kind of consumable ephemera that seems to control our lives these days.

So: by the end of next week I will have called the company that I pay the money to. I'll find out how much the debt is worth, when I will have paid it off, if there is anything I can do to speed that up and if I have to pay a fee to keep the laptop on settlement.

So. I know this is hard. I know that facing up to your debt is really, really anxiety making. I had panic attacks when I first looked at the balance of my credit card. But I did it, and I made better decisions which corrected earlier bad decisions and I kept at it and now in 1 weeks time, I will be out of credit card debt.

What do you say. Who's with me? Who's going to make the commitment to finding out what their debts are and having that information all in one place to build a bigger picture?

Please, don't share any details you're not comfortable with complete strangers knowing on the internet. A comment of "I did it!" without discussing finances is enough unless you're comfortable with sharing that much.

Comments

[lassarina]

I actually use Mint to track these things (oh hearts for Mint), and the only debt I have beyond the cards is my car loan. In my defense, I bought it used and it's a Toyota, so it will either last me ten years (thus fully recouping the money I spent and how) or when I go to sell it, it will have depreciated only a small amount, since freaking everyone seems to want a Toyota based on how hard I had to look for a used one three years ago.

I also just got made permanent at my job (hurrah hurrah oh glory be), so there will be extra monies every month to kill off the cards.

\o/

[jamethiel]

Oh, if you need something (if my computer breaks down before I get my savings back up I will be borrowing. I need my computer or I will go insane.) borrowing is essential.

CONGRATS on the job! Let us know how killing the cards goes!

[lassarina]

Thank you!

It looks like the job will give me an extra $300-400 a month toward the cards (and I'm moving in with the paladin, which from combined expenses should net another $100), so I have very high hopes that after the initial outlay for moving (new furniture and such, since the bookshelves are, er, very old and somewhat wobbly, for example), I should be able to get that $20K of credit card debt good and beaten. :)

[jamethiel]

Ooh! If you can act like you never got the raise, live like you're on your old salary, you're LAUGHING.

[lassarina]

I was living pretty comfortably (and making small progress, even) before I got the raise, so I think that shouldn't be a problem.

Honestly what I'm proudest of is that even though I had to tap my retirement account to do it, I lived while I was unemployed for 5 months without upping the credit cards at all. I could pay them off really fast if I went back to living like that, but it was much too stressful to worry about literally every cent I spent, so I'll go on like this and be comfortable, I think. It'll take longer, but I'll be happier.

[jamethiel]

*nods* Everything's a balance. I'm quite probably going to get a bit back on this tax return, but I'm spending it on electronics and the rest is going in savings, not in the housefund where I can't access it. I need an iPod. Music is such an important part of my life, it's how I relax and get some privacy and also what I run to. My little shuffle is PISSING ME OFF (the headphones are awful). So I'm going to buy a nano for running and a classic so I've got something with all my music when I'm out and about. And then I will buy a 1TB hard-drive for computer backups and anything left over gets put into savings. And I'm not going to regret it or feel guilty. I have worked damn hard to get my credit card down and without going into debt, I deserve a little fun.

Grats on not upping the card limit when you were unemployed! It's such a trap, and then you get into this situation where it only requires ONE THING to go wrong for it to fall apart (it's what happened to me. Unemployment and then the card balance never went down and then I had to move. Ugh)

[lassarina]

That was pretty much my reaction to my backpay, yeah. I'm getting a new phone (smartphone! LJ/DW ANYWHERE! eeeee!) and replacing my 6.5 year old iPod, but those are my treats and things I've had in mind for quite a while now.