add me to the list as well. As a graduate student without a real job, assistantship, or picking rich parents, I’m left to deal with federal loans which don’t provide for all my living expenses. I swear to God if I dont get an assistantship next year I’m going to transfer.
We have 1 beater car and unfortunately need a reliable car for commuting. Sometimes keeping a beater car running costs more than paying for a new car.
The motorcycle, yeah, I’m with you on that one. I wasn’t happy when that came home.
I like this Ramsey guy.
I have 5 FSA SRM Pro, wireless, selling for $1,999 a piece shipping included.
Anyone interested in this thread?? 
all this talk of ‘you must not have c/cs, pay cash/debit everywhere’ is stupid, of course it is a really bad idea to carry a balance on them, but if you are on a 1% cash back c/c and pay it in full each month you can EASILY make money on it if you charge everything to it (not to mention things like air miles, or travel assistance for your car, etc.). As long as you start seeing your c/c bill as another monthly bill you pay in full, and you completely ignore the ‘minimum payment’ hook, you’ll be fine no matter how many c/cs you have.
While we follow his plan, we never paid for anything. You can google Dave Ramsey Baby Steps and get the idea of what his program is about. Listen a few times on the radio or to daveramsey.com.
LOL!
Francois, that’s COLD, man!
I figured I could post that, because I would totally fall for it, 5min after swearing to not charge my CC anymore 
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I got 2 out of 3. My mortgage length is the violation.
That’s just ridiculous. How would you stay at a hotel or rent a car without a credit card?
Simple, pay with cash or a debit card. I am 47 and have never owned a credit card. We paid off a mortgage and saved and would not borrow to get anything. We have no debt and that alone is worth any inconvenience of not having a card. We commuted by bicycle for 4 years without the use of a car. It is not always easy but we were able to quit our jobs and bike for over a year and now do things we love. If we were caught in debt, there is no way we could do this so ultimately you have to make a choice over what is important, the convenience of a card or no debt.
Besides, I get goo-gads of airline miles with my credit card.
That’s the marketing trap. Yes you can get lots of deals but you can do the same if you research cheap flights or fly at odd times. Yes it can work if you pay it off every month but the reality is that most people don’t. If they did, credit card companies would be out of business. For every one of you disciplined to pay it off, there are thousands who get caught in the trap of “if I pay for this on my card, I am saving because I get free stuff.”
As an aside, I have attended the Dave Ramsey course and really, we did everything he suggested before we knew anything about it. It really is common sense and we were surprised that so many had no clue. They really need to start teaching this stuff in schools.
I paid $129 for the lifetime membership which gives us all the goodies and the class. We can take the class as many times as we want now.
Starts next Thursday. Looking forward to it.
I bet he accepts credit cards as payment?
Nope, you have to use a debit card or a direct bank draft. He walks the walk.
Ha! Unfortunately I don’t listen very well. My parents live debt free including owning their house. Dumb me.
Congrats on the successful way that you have managed your affairs, but no one is going to convince me that not having a credit card is the way to financial success.
Used properly, it is better than not having one. When my girls are old enough, I will be encouraging them to get a credit card and I will help them learn the right way to use it.
FYI - Debit cards typically don’t offer the same consumer protection as credit cards, for what its worth.
I think this Ramsey guy is a snake oil salesman. Sure you will get out of debt if you really stick to his advice, which appears to be live like a fucking homeless person until you are out of debt. I say, fuck that, so I guess that makes me a moron.
My wife and I have a “substantial”, but very manageable amount of unsecured debt. We both had to pay our way through undergrad and grad school. Most of that debt is student loans, but a modest amount is outstanding credit card debt which we have been carrying for some time. Could I pay it off earlier? Yes. Am I going to? Doubtful. We aren’t adding to it, thats the most important thing, but I have devised a payment schedule on my own that I feel is a much better plan towards building wealth and its based on the philosophy that we pay ourselves first. We could liquidate our savings and stop saving and dump all that money towards debt and essentially be free of all debt in about 30 days. In order to do so, I would have to sacrifice the ability to contribute the max to my 401k, not going to happen and dump investments that I own today that have been depressed in these markets…also not going to happen. As a matter of fact I am considering paying ourselves even more. If the markets were thriving I may change that philosophy a bit, but today I am buying and buying and buying as many index fund shares as possible.
All that being said, our weighted average discount rate on all outstanding unsecured debt is 3.6%. Not exactly “credit card” rates and 95% of that is locked. I am gambling that the money we are saving in lieu of paying down debt is going to earn more than 3.6% in the time it takes us to get out of debt, which is about 24 months away barring any unexpected purchases.
Still you have to be comfortable being slightly levered, I simply don’t feel the “burden” most people feel. Its only money, I never had any growing up anyway.
**Debit card my friend, debit card. **
you are a wise man indeed.
I am in violation of all of them but I have more than 20% equity, I am currently overpaying my mortgage (about 1/3 of take home) and I have (based on the current interest rate) about 17 years left.
The first one does not matter now to the extent I have equity, the second I am paying more by choice as my interest rate is less than 1% and I think I should make hay while the sun shines and the third by November this year will be between 10-15 years. (depending on interest rates)
I am on a tracking mortgage that tracks at .06 below base, I have no intention of switching back to a fixed until such a point in time that the interest rate on my tracker (at the end of the year I go to .95 above base) is equal to or more than the available fixed rate mortgages out there. At present thats not likely to be any time soon here in the UK.
So I suppose I could meet all three but am actively choosing not to in order to pay off my mortgage expeditiously. I think thats the best course of action right now.
I have one credit card, a debit card, and an AMEX. $0 balance. I own my car. I owe no student loans. We have a 0% loan on my wife’s car. We have a 27" regular old TV in the living room, and a 17"incher in the bedroom.
I used to carry a CC balance. “it’s a $1000, no big deal.” Until I started looking at finance charges. Thank god my wife prodded me to pay off our CC every month. Which we now do. The answer is not cutting up your credit cards, unless you simply can’t control yourself and have to have something right now (which I understand). The answer is being responsible about it. Just because you have a credit card doesn’t mean you *will *be in debt. That’s just silly
Side effect is some free miles, we’ve gone to Europe and Australia thanks to CC miles
I just started a new job (got laid off last Aug) and am currently using the market downturn to put together at least 6 months worth of savings. Halfway there already. Should be done in two more months
It’s a scary time, but i am thankful I am not extended over my head.
Good luck with your progress. I can’t imagine the stress that having CC debt can bring.
I’m 50, and I have never carried a CC balance (excepting the 2-3 times I plum missed the payment deadline) in 28 years of CC usage. And I use my CCs for everything that’ll take a CC, due to the convenience.
Blaming CCs for CC debt seems kind of silly. Just ask “do I really need this?” before any purchase. If the answer is “no,” then don’t buy it. If the answer is “yes,” then ask “can I get something cheaper that will do well enough?”. For instance, nearly all my kids clothes and early childhood toys were purchased at a second-hand store in nearly perfect condition (just got them both ski jackets/pants for $25 total). Do I need another pair of De Soto cycling shorts? If yes, then I wait for someone to have them on sale.
Having kids gives one an abhorrence of “stuff”. I can’t believe how much stuff my kids have accumulated. I hate buying stuff. The only stuff I’ve bought that I didn’t need in the past 18 months (since we moved to a new house) was a 42" 1080p LCD and a surround system ($1500 total or so).
Blaming CCs for CC debt seems kind of silly. Just ask “do I really need this?” before any purchase. If the answer is “no,” then don’t buy it.
I never blamed the CCs for my situation. Actually I tried very hard to make sure I didn’t come across that way. My situation is strictly my fault and nobody elses.
Here is the deal though. Its not a perfect analogy, but I’ll give it a shot. This is what I have learned from watching “Maxed Out”.
Lets say Scumbag Spirits starts selling booze. Things go well because they are providing a nice product. They make money. But then Mr Scumbag decides that he is greedy and wants more profits. So he brings in Mr Asswipe, the consultant. Mr Asswipe tells Mr Scumbag that if he figures out a way to identify alcoholics, then tempt those alcoholics with Mr Scumbags tasty booze, he could increase his profits. Because once Mr Alcoholic gets a taste, he can’t stop easily and will continue to use Mr Scumbag’s product. Great says Mr Scumbag and he adjust his marketing accordingly. But its still not enough, so he hires another consultant, Mr Cocksucker then tells him that once he gets Mr Alcoholic hooked, raise the prices even more so that Mr Alcoholic can’t afford to pay for rehab and will be hooked forever.
Like I said its not a perfect analogy because alcoholism is a disease. But hopefully it helps get my point across.
Good luck with your progress. I can’t imagine the stress that having CC debt can bring.
I guess I don’t see it that way. I can’t believe financial matters bring people so much stress. This country gives you a free re-do for crying out loud. Not that I am advocating bankruptcy by any means, but its an option that millions have succesfully used to re-build themselves. I guess, I just learned at a young age that while money is nice, its just not as necessary as people think. I enjoy my life, I am confident in my ability to effectively manage our financial matters and have reason to believe I may actually be able to retire at a relatively early age. I manage our affairs to a goal net worth, not just the liabilities.
Most people I know are penny wise and pound foolish and I just don’t understand it. Two of the best decisions I made were to borrow for school and then of course finish school and waiting a little while before getting married and having kids. Most of my friends in financial difficulty just didn’t invest in their careers enough and started a family under financial instability. One of the worst decisions I made personally was buying a condo at the peak of the market, which is a life lesson I will never forget. That being said it will probably turn into a nice little investment property for us in time.
But people seem to try to nickel and dime their way out of debt all the while missing a golden opportunity to cash in on a recession! Job security is certainly important, but its no fluke that I feel secure. I have made myself somewhat indisposable and chosen to work for a company with a substantial amount of critical mass which makes it a very unlikely acquisition target. There must be critical thought before every major life decision, if you make the right decision on those 5-10 major life decisions, the thousands of other ones just don’t matter that much. Instead many people feel like every little decision is life changer and hence the stress.
I firmly believe you have to focus on the BIG picture in life. Brown bagging it everyday, while prudent, just isn’t going to get you ahead of those people with a vision for their life beyond the next 6-12 months. Of course, this is coming from one of those morons so probably wise to just ignore it.