$17k and Counting...Down!

I thought I'd let you know how this has been going from a woman's point of view. One of the things I've been doing to help cut back on costs has been the one car. We had to get a new car because our last one blew a head gasket. So we thought about it and decided that instead of getting a car now and then a second one for me we'd just buy one and share. The total payment and insurance comes to about 300.00 a month. A whole lot easier to swallow than the 600.00 + we were paying for Scott's car he had when we first started dating. I also started buying my make-up when it's on sale and getting an extra one instead of paying full price at seperate times. But the biggest thing I've done is changing my hair. For years I've been coloring my hair dark brown so I dyed it back to my natural blonde. It will save about 100.00 every 6-8 weeks.

Ladies, what have you done to cut down beauty costs?

My wife and I went over our checking account statements for the past few months and found the #1 thing that drains our account each month: restaurants. It is currently to the tune of approximately $250 a month (!)

Because of this, we have decided to attempt something very drastic: for the entire month of August, we are not going out to eat. None. Never. Nada. We're going to adjust our grocery spending (currently at around $100/month) to fit the plan, plan dinner rather than swinging it, and I'm going to start packing lunch to work or eating sandwhiches at home.

Also, on a good note, my wife asked if she could work a few extra hours each week (24, up from 20) which brings us an extra $100 per month. All of that will be going directly to the debt consolidation loan.

Have any of you ever tried anything as drastic as completely cutting out something you've enjoyed for years? How did it go? Are you still doing it?

Leslie and I have spent a bit of time this past week going over where we are heading with this and how we plan on going about it. Here are a few quick notes about what the plan is:

1) Find places in our fixed expenses that we can cut down (IE: lowered cell phone plan, remove unnecessary services, etc)
2) Evaluate our "unnecessary" monthly expenditures and determine where we can cut down (IE: restaurants, movies, etc)
3) Look around the house to find out what we do not need and can sell (likely on eBay)

With our preliminary guesstimates, we're throwing away over $300 a month that can go straight to paying off our debt - it's amazing what a little cutting down can do!

What types of cut-backs have you done in order to free up some much-needed money each month?

One of the hardest parts of being so heavy into debt is keeping track of everything. I am constantly logging into the credit card websites, checking balances/APRs/etc, tracking payment due dates, and the list goes on. I've been doing this for the past few years, and it's getting old! So, 2 weeks ago, I decided that I would follow the advice I've come across and call to get a lower rate on my credit cards.

I had a credit card through MBNA with a ridiculously high rate (30%+), so that is where I started. I called them and told them that I had to have a lower rate or I would be taking my balance elsewhere. I spoke to the rep for a bit about why I was lowering my rates, and he mentioned to me that they have a debt consolidation program that they offer that is geared towards people that are currently working on paying off their debt. We went over my balances, he pulled my credit, and I now have $11,000 of my debt, 4 accounts-worth, rolled into a consolidation loan. My monthly payment on the loan is around $80 less than the combined payments on the 4 accounts, the interest is lower than the combined rate, and I am one step closer to taking control of this beast!

I now have a consolidation loan ($11,000), a Dell charge account ($3,000), and my IRS tax bill ($3,000). The minimum payments are as follows:

Consolidation: $250/month
Dell: $100/month
IRS: $125/month
---------------
Total: $475/month

3 payments is a lot easier to handle than 6, and my total minimum payments have gone down. I won't be paying any less (in fact, I'll be paying far more) but it's nice to know that I have some padding if I have a bad month.

The first step in this process for me has been to admit my mistake to myself and my wife. As many of you already know, it's hard to NOT know that you are in debt up to your ears, but many of us, myself included, don't like to admit it to ourselves.

So here it is: I've gotten myself in too deep, I've caused unnecessary and unhealthy stress in my life and my marriage, and I am going to change it.

Boy, does it feel better to get that out!

What was your turning point? What made you decide to take control of your financial life?

For the past little while, I've been reading everyone else's blogs about personal finances and it's been a huge help for me. Considering that I'm deep in the hole, it just might do someone else some good to know what I go through. First off, let me tell you a little about me and how I got in this deep =)

I'm 22 years old, and since I was 16 I've been self-employed as a contract web developer. In those early years I was making $20/hour on average, and as one of my clients once told me, "the more you make, the more you spend." Regretfully, I lived that mantra to the max! After hundreds of CDs, burgers, [insert anything and everything here], I managed to spend every penny I had. Along came the credit cards... "I'll pay it back when I get my next check." We all know that game - I'd never pay it back, the balance would go up and up, and pretty soon I had no more credit. Sooooo...I'd get another card, transfer the balance, and start all over again (don't we ever learn?!)

Long story short, here I am today with $14,000 in credit card debt and another $3,000 owed to the IRS on a payment plan.

I was married on October 14, 2005, to my beautiful wife Leslie. She knew I had all of this debt, and thankfully she still loved me enough to saddle herself down! We're now 9 months into marriage, and we're ready to take control of our finances!