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Money Matters
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Old 04-04-2011, 01:54 PM   #81
SLVR JDM
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Well it didn't work out anyways, so no biggie for now. I decided I think I'm done with the idea of an M car.
That's alright. Save up for it and pay in cash at some point in the future. Being able to do that makes it far more rewarding than signing up for a monthly payment on a loan.

I'll finish paying off my car in 1 month and it will be great to get that behind me. We bought a used car (Acura MDX) last November with cash and it was a great feeling....wasn't my dream car or anything, but didn't take a loan on it, which was more satisfying!

Hopefully it is at least another 5 years (more would be great) before another car is needed for my family. That would put my G at 11 yrs old and the MDX at 13 yrs old, but we rack up low mileage and each only have 5x,xxx miles right now.
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Old 04-04-2011, 02:34 PM   #82
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Well I have been quietly following this thread for about a year so I suppose it's about time I contribute. I just turned 30 and have been divorced for 3 years. As part of the divorce I took all the retail debt, a big reason for the D in the first place.

So I was left making not a lot of money in those days and 6 credit cards with over 13k of balance and an attorney to pay for. I managed to make a few good decisions cutting expenses out of my life (Cable, Gym memberships, cell phone, car with note, etc.) basically everything that was non essential.

I read Ramsey's book and gathered what I could then decided to take the Envelope system to a digital method, since everything I pay is online anyway. So I went and opened a second checking account for my daily personal expenses (Food, Gas, smokes back then). I had my direct deposit changed to where I got the equivalent of $6.50 / day deposited into the new account and everything else went into the existing "Bills" account.

This was a good start and I was making a lot of headway but this was right around the time of the market crash and sure enough all of the sudden my accounts that were all <10% interest shot up to ~26%. Well boys that math doesn't work.

Fortunately, my newly acquired lack of expendable income had paid dividends in the form of a promotion due to long hours in the office (couldn't afford to do anything else). So I was able to use the increased income to convince my banker to give me an unsecured loan for the total debt on the cards which at the time was about 11k. I don't remember the exact term for it but it was a 24 month ballon note. So basically the payments were based on a 48 month term but the balance comes due in month 24 or 25.

And today after two years in a seemingly unending hell of not going out and missing bachelor parties in Vegas I paid off the note 11 days early


What can I offer as advice to someone who may be in the same boat?

1 - It's possible. I did it you can too

2 - It sucks. More than anything has ever sucked before.

3 - Make a list of your expenses and cut them.

4 - Then cut more There's always something, for instance I moved into a studio apt.

5 - Look into consolidation if it's possible. Worked out great for me.

6 - Limit your access to your money. In my case it was making extra payments all the time to make sure I didn't have cash at hand to buy matte grills or that great deal M. Essentially make mistakes.

All the debt didn't add up in a day and it sure as hell, barring a winning lottery ticket, isn't going away in a day. Try to find a someone you trust to talk about it with, in my case I had gotten a promotion and was making a lot more money but never got to reap the tangible rewards for my hard work. That can get depressing and it's good to have someone around to remind you that you're on the right track.

So all in all it feels great but it's kind of like graduating from HS you work a long time towards a goal and once you get there it's more hard work in College and after. Debt-free is a lifestyle and I'm only in my infancy but I imagine it will be a lot of fun in a few years.

And of course thanks to everyone who has contributed to this thread. Reading your stories and progress has been very helpful.
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Old 04-04-2011, 02:44 PM   #83
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^Congrats on the hard work and seeing it pay off! Good luck going forward.
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Old 04-04-2011, 03:33 PM   #84
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Cool story RHLP3.

I think I'm going to be taking the advice of point #6. I told my wife to calm my new car fever down I'm going to pay off the medical stuff at the end of this week! So the final item will be my student loan. Hopefully I can pay for it this month too.
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Class of '03, yet you're still an idiot. Whats your point? Do you really think that you're somehow a god because you joined a site before someone else? ****ing nerd.
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Old 04-04-2011, 03:44 PM   #85
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Good to hear man, I had to get rid of my checks, cut up the debit card and give my corporate Amex to my boss for safe keeping. Eat the bear one bite at a time.
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Old 04-18-2011, 06:40 AM   #86
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Well I started to invest in my Roth 401k last week. Kicked it off with 10% of net pay. I'll crank it up to 15% once all of our debts are paid for. I really want to get into the investing now. I just set the plan for "aggressive growth" as I am 26. I know this sounds late to a lot of people, but in my family, I'm the first to actually start putting away for retirement. My grandpa has military pension, mom married a guy putting money away, and my dad... hell I don't think he even has a plan.
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Class of '03, yet you're still an idiot. Whats your point? Do you really think that you're somehow a god because you joined a site before someone else? ****ing nerd.
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Old 04-20-2011, 06:43 AM   #87
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Man, it is hilarious at times, but being debt free and smelling the balances of positive growth is phenomenal. I got a pension too, but I want to be like Warren Buffet and have myself into a lot of different things with positive growth. My next goal is getting out of the car note business and once the balance is down on my rental property, buying some more land. Was looking at it this way, instead of making a car note, use that money to do other things. Currently fully funding the ROTH, TSP at 5%, and got a savings on the side that gives you a 3% bonus per deposit and earns overall 3% per year. Other than that, I am still aggressive because I do have a pension coming. Looking forward to starting something that spans generations versus just my lifetime!!
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Old 04-21-2011, 03:06 PM   #88
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A side note since the topic has been mentioned here a couple times. A 'pension" or "retirement" is only guaranteed to happen sometime after you need to start planning for retirement. My "retirement plan" when I was younger was to do my 20 years in the military, get a nice paying job for the following 20 years and sock away all my "retirement" checks in the meantime. Then between social security, my military retirement, the money I invested for 20 years before retiring I would be pretty well set. Because of that I spent spent spent. When I was medically discharged with 3 months notice and no retirement check or retirement savings to speak of it was a kick in the financial nuts to me. I've been completely debt free and living well below my means for about 3 years now and it's a great feeling knowing that I still have ample time (and currently resources) to be able to retire at a decent age. Had my situation happened four or five years later it could have meant being very unlikely to retire with a decent savings at a decent age.

Especially for those of you counting on a retirement check, I would recommend that if you aren't already, plan for retirement without it. If nothing derails it and you get the pension then it's just a more comfortable retirement. If something does derail your plans, like the med discharge did mine, then you will already be in good shape and it won't screw with your long term planning significantly.
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Old 04-21-2011, 06:20 PM   #89
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I agree and that is why outside of the pension you research and understand other things. Trust me had I knew 16 yrs ago when I joined up, I would have taken advantage of a lot of things besides cars, partying, lol.
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Old 05-06-2011, 10:10 AM   #90
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Paid off the car today. () Now I need to take the money I would have been using for a car payment each month and sock it away. Cash flow has been tricky lately and will get even more complex as my wife goes PT as of August. My goal is to stash away $5k between now and August as a cushion fund to help on a month to month basis as needed.
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Old 05-06-2011, 10:13 AM   #91
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Congratulations on the car payoff! Smart move with the money storage too.
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Class of '03, yet you're still an idiot. Whats your point? Do you really think that you're somehow a god because you joined a site before someone else? ****ing nerd.
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Old 05-06-2011, 10:21 AM   #92
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Congrats

On to the next goal.
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Old 05-06-2011, 12:09 PM   #93
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BTW is that a "car is paid for" celebratory burnout in your sig now?
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Old 05-09-2011, 09:15 AM   #94
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Paid off a student loan today!

Left to go:

Car: $0.00
School Loan 1: $0.00
School Loan 2: ~$1,135.
Medical Debt: $3,320

Total: $4,455

Highest Interest Rate - Student Loan 2 @ 3.87% ( I just got a paper statement on this... finally! )
Lowest Interest Rate - Medical Debt @ 0.00%

Highest Payment - Medical Debt @ $167/month
Lowest Payment - School Loan @ $50/month
Okay, so I'm a honest guy. The wife and I unfortunately took on some more debt for a purchase. Was it the smartest thing? No. Absolutely not. However, it has been done and we are working hard to pay it off. It will provide a lot of savings in the future as we travel quite a bit and plan to ramp it up A LOT in the future (no kids ftw).

In the meantime, we have made progress.

School Loan 2: $991
Medical Debt: $0.00 (recently paid off! )
New debt: $8,812 @ 7.49%

Total: $9,803

Highest Payment: $212 (New debt)
Lowest Payment: $50

Anyways, plan to pay down heavily on the new stuff in the future. Once again, retarded I know. I'm not too pleased about it. I could be debt free already if it wasn't for my stupidity.
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Class of '03, yet you're still an idiot. Whats your point? Do you really think that you're somehow a god because you joined a site before someone else? ****ing nerd.
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Old 05-09-2011, 09:32 AM   #95
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BTW is that a "car is paid for" celebratory burnout in your sig now?
Haha, I suppose that and I was on the way to the shop for new tires. Might as well make fun use of the old ones, right?
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Old 05-11-2011, 10:04 PM   #96
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In the interest of full disclosure/honesty I will admit that I am no longer "debt free." Almost 2 weeks ago I traded my 2002 330i in for a 2010 Infiniti G37. I chose to finance most of the purchase (minus trade in and some money down) because the interest rate through Navy federal Credit Union was much lower than the returns I have been seeing from the market (brokerage averaging better than 401(k) which has met or beet the indexes over the past few years). I took on 19.9K of debt with it and am taking any overtime or other non-expected money to pay it down faster and have a plan of putting 10-30% extra to the loan per month. First payment "was" due 6/21/2010 but I am now at 18.4k on the loan with a bit over a month left before the first payment was supposed to be due. I'm maintaining my 11% to the 401(k) (upped it this year when I started having overtime but may drop it later in the year to only put in the max IRS will allow pre-tax of 16.5K) and haven't changed what I'm putting in my savings or brokerage accounts.

While I hate "owing" money, I have the money to pay it off but am currently making more from that money than the interest on the loan is costing me even before I pay it off early (as I'm doing mainly for a psychological reason that isn't necessarily good finances). I did make sure that my emergency savings was at my 9 month mark on top of the car before I bought it so even if things go south I'll have my savings plus pay-off amount to get me through any rough spots. I don't know if "Dave" would be happy/proud of my decision, but with tranny issues popping up it was really time to move onto something else and I managed to talk myself into this. I hope to keep this car for another 7-8 years at a minimum unless I run into a good reason to move on.
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Old 05-12-2011, 08:12 AM   #97
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Your rationale is fine. I'd do the same thing in your position. Congrats on the G
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Old 05-12-2011, 03:10 PM   #98
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Congrats on the nice ride, I am sitting till next year with any more debt.
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Old 05-12-2011, 03:33 PM   #99
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In the interest of full disclosure/honesty I will admit that I am no longer "debt free." Almost 2 weeks ago I traded my 2002 330i in for a 2010 Infiniti G37. I chose to finance most of the purchase (minus trade in and some money down) because the interest rate through Navy federal Credit Union was much lower than the returns I have been seeing from the market (brokerage averaging better than 401(k) which has met or beet the indexes over the past few years). I took on 19.9K of debt with it and am taking any overtime or other non-expected money to pay it down faster and have a plan of putting 10-30% extra to the loan per month. First payment "was" due 6/21/2010 but I am now at 18.4k on the loan with a bit over a month left before the first payment was supposed to be due. I'm maintaining my 11% to the 401(k) (upped it this year when I started having overtime but may drop it later in the year to only put in the max IRS will allow pre-tax of 16.5K) and haven't changed what I'm putting in my savings or brokerage accounts.

While I hate "owing" money, I have the money to pay it off but am currently making more from that money than the interest on the loan is costing me even before I pay it off early (as I'm doing mainly for a psychological reason that isn't necessarily good finances). I did make sure that my emergency savings was at my 9 month mark on top of the car before I bought it so even if things go south I'll have my savings plus pay-off amount to get me through any rough spots. I don't know if "Dave" would be happy/proud of my decision, but with tranny issues popping up it was really time to move onto something else and I managed to talk myself into this. I hope to keep this car for another 7-8 years at a minimum unless I run into a good reason to move on.
Its okay.

At least you are honest. Honestly, I would love to sell my car for $8k or so and put the money towards a nicer car, but the idea of a car payment more than the actual debt would drive me mad. I just can't enjoy the car knowing I don't actually own it. I was going mental back when I owed money on the Sky.

The G37 is a fantastic car despite what the fanboys on this site say.

The debt I got I feel was even worse. So bad I don't feel like talking about it lol. Oh well. I just want out so I can focus on getting out of Accounting and work at a job I find more fun. Same goes for the wife, she wants out of accounting too.
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Class of '03, yet you're still an idiot. Whats your point? Do you really think that you're somehow a god because you joined a site before someone else? ****ing nerd.
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Old 08-03-2011, 02:29 AM   #100
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Updates from my January 2011 post.
"Awesome about the car loan!!! We are focusing on mortgages for this year and will continue to send extra payments to our mortgage on the vacation house and I do the same to the other rental property we have. Looking at selling the rental in 2013 and should have no mortgage on the vacation home at that point. That means we'll be 100% debt free by 2013-2014. (I'll be 31-32 and she'll be 30-31 at that point)"

Since then I had an unexpected raise/promotion at work. Since the Horizon incident last year, uscg licensing is becoming more common on the drilling rigs so in June I got bumped up from a third engineer to a first engineer unlimited. Basically no increase in responsibility/job changes except for the 47,000$ raise. I instantly bumped my 401k up to 20% so I hit the 16.5k for this year(company will match 100% up to 6%) I bumped my monthly savings up to 5,000/month since I know my career/profession will be changing within the next few years. I'm 29 now, don't plan on working out at sea at 32 years old so I am saving like crazy right now.
Girlfriend is on the same page, I think conservatively we will have her house paid off by 32. I balance between paying mortages down and putting my savings towards my Thinkorswim trading account. It was much easier changing my savings before I saw my first check, basically I live on the same exact amount I was making before, just save more money each month now.
My 91' 4runner is still running strong, only 92k on it as of today, I'm planning to upgrade back to a BMW once I work on land and can enjoy driving my car daily.
My daily driver will end up most likely being a subaru outback or vw sportwagon, Bmw will be an E30 swap car, E46M3 or another E90 330I like i had before.
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