Debt - Page 3

Pennypacker · 02-27-08, 01:36

I remember seeing him on 60 Minutes. Sounds like solid advice, just painful to implement. I don't doubt it's the right approach, though.

mshu7 · 02-27-08, 01:37

Painful, yes. Rewarding, hell yes!

I wish my wife & I would have found him 5 years ago when we got married!

Holden_C04 · 02-27-08, 01:50

I don't think that debt is bad. I think consumer debt is bad. Sure, pay off stuff early if it makes sense but I don't think enslaving yourself to debt payments is the right way either (unless its cc debt then I say go for it).

Holden_C04 · 02-27-08, 01:51

I think the phrase, "all things in moderation" is a good one.

yrebel7tpx · 02-27-08, 03:54

I Am Going To Live Dept Free That Is The Only Way To Live

Live Like No Other So One Day You Can Live Like No Other
Dave Ramsey

Holden_C04 · 02-27-08, 03:58

It's virtually impossible to live debt free. It would be very difficult for most people to buy a car, attend university, or get a home without some form of debt.

hockeyplaya13 · 02-27-08, 04:03

Dude, calm down, use some lower case letters. Dave Ramsey is not God.

mshu7 · 02-27-08, 04:06

Other than a mortgage, I think living debt free is definitely do-able. It's just a matter of priorities. I grew up with a banker as a dad so believe me, it's possible. Our generation (I'll be 28 on Sunday) seems to start out with a lot of debt and it's hard to get out from under that. However, as my wife & I are finding out, if you prioritize your expenses you can overcome it. It's all about the choices that are made (ie - buying a bigger/newer house than you can afford, buying cars new vs. used, going out to eat a lot, buying stuff to "keep up with the jones', etc.). All that adds up quick. People tend to live outside of a real budget and that's why I think most people go into debt. Obviously, certain circumstances are hard to avoid. However, if one budgets their money BEFORE earning said money, living debt free shouldn't be a problem.

ramtough · 02-27-08, 05:12

42YRS OLD no debt never owned a credit card of any kind. Smallest first always add 10 to 20 more on each payment you will see a differance after a year.

Slick61 · 02-27-08, 05:42

Been there... done that. When I graduated ('91), job market was TERRIBLE, so ended up taking the 1 year grace period on student loan payback. To make matters worse, I consolidated all my student loans through Sallie Mae (at a higher interest rate). Plus, I had several smaller loans that were directly through the university & had to be repaid immediately. And to add insult to injury, I incurred about $7k worth of credit card debt during the first year after graduation. It was tough, since I was only making $25k per year. I lived paycheck to paycheck for a long time trying to pay down my debt.

Sallie Mae was the worst... if your payments were one day late, you started getting all these nasty letters from them. After 7 years, I'd finally had enough. I sold my car, bought a beater, & called Sallie Mae. After 7 years of payments, the payoff on a $15k principal was still over TEN THOUSAND DOLLARS! Told them the check was in the mail & don't EVER call me again. I also paid off my credit card debt around the same time & swore never again.

Since that time, I've never carried credit card debt... usually just a car payment & mortgage. I could pay off my current driver, but decided to put that money to work elsewhere. Paid cash for the Cobra, so no debt there.

I emerged from my excessive debt about 10 years ago, & did it with my credit score in tact... which now stands at 802. It comes in handy when you go to buy your first home (no help from mommy & daddy here). It's tough, but hang in there. It'll get better eventually.

Holden_C04 · 02-27-08, 06:33

For some strange reason, student debt seems to have the most ruthless collection practices around. I've heard some very nasty stories....

aabablusaan · 02-28-08, 10:50

Quote:

Originally Posted by Holden_C04

For some strange reason, student debt seems to have the most ruthless collection practices around. I've heard some very nasty stories....

You're right; however, I got extremely lucky with my student loan program when I went to Grad School - my rate is 2.1% fixed, even with a total balance of $40,000 for my MBA and MIS. I took out a 30 year loan at that fixed rate with a graduated amortization with flex payment. For the first 2 years after grad school, my minimum payment was $100 a month, and I paid $200 a month. Now that the minimum has increased to $200 a month, I now setup an auto payment of $400 monthly. Given my current schedule, I'll cut that 30 year loan out in about 19 years...still at that 2.1% rate, with interest payments still tax exempt for another year. I love it. This is a debt that I have to be patient with, but is manageable.

My GF isn't so lucky...she's currently in law school, and her rate is 7.1% on a $50K principal, plus undergraduate debt around $70K at a 6% rate!!!

I just learned about Dave Ramsey from this thread, and I think I will go with his plan. I already have the 1K emergency, already have the savings, but I need to cut out some credit cards ($3,000 in debt). Thanks for the Dave Ramsey mention...