Never Want To Take Out A Loan Again.

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
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Nancylee
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Never Want To Take Out A Loan Again.

Post by Nancylee »

Hi all,
I did dog rescue for about 5 years, and the financial aspects of it crashed my credit. My husband and I had also co-signed our sons' student loans, and they were late with some payments, which hurt his credit rating. So we just got turned down for a car loan at a decent credit rate. They wanted us to pay over 15%! We told them no, but need a car, as the one my son has been driving is a 1994 Subaru with holes and a bad muffler that lets in carbon monoxide. I am now driving that, as I don't want my kid killed.

Question: I really, really hate banks and credit card companies and brokerage firms. Oh, and insurance companies. Because they screw the little guys all of the time. One late student loan - credit rating is severely impacted. I am 51, have a secure job, can retire in 4 years. Some savings in a 403b. My husband is retired/disable, gets an excellent pension. We have two homes with mortgages, and one car with a loan. A boat loan, and an ATV loan, we use for a snowplow. No credit card debt.

Is this possible? How,would we start being loan free from now on? Can you actually save for a car? Please give me hope, because I hate being beholden to big corporations.
Thank you,
Nancy
Beantown85
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Re: Never Want To Take Out A Loan Again.

Post by Beantown85 »

You have a car loan, two mortgages, a boat loan and an ATV loan. I'm wondering if you really hate loans.

Sure it's possible to save for a car. One way to help do that would be to not take out loans for things like boats and ATVs.
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mhc
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Re: Never Want To Take Out A Loan Again.

Post by mhc »

You could do it by stop borrowing money to buy things. Living below your means and paying cash for what you want to buy will keep you out of debt.

It is possible. I decided to be out of debt by age 40. I met my goal 1 month early. I own a house and two cars. There are 5 people in my household. Single income. We live below our means.
52% TSM, 23% TISM, 24.5% TBM, 0.5% cash
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femur
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Re: Never Want To Take Out A Loan Again.

Post by femur »

Greetings,

If you are willing to do a little work and a good deal of research, it is not too hard to clean up your credit reports. I would recommend heading over to this website: http://creditboards.com/forums/

Therein is a great deal of information about how credit works and how you can improve your credit score.

-Femur
Fallible
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Re: Never Want To Take Out A Loan Again.

Post by Fallible »

Nancylee wrote:Hi all,
I did dog rescue for about 5 years, and the financial aspects of it crashed my credit. My husband and I had also co-signed our sons' student loans, and they were late with some payments, which hurt his credit rating. So we just got turned down for a car loan at a decent credit rate. They wanted us to pay over 15%! We told them no, but need a car, as the one my son has been driving is a 1994 Subaru with holes and a bad muffler that lets in carbon monoxide. I am now driving that, as I don't want my kid killed.

Question: I really, really hate banks and credit card companies and brokerage firms. Oh, and insurance companies. Because they screw the little guys all of the time. One late student loan - credit rating is severely impacted. I am 51, have a secure job, can retire in 4 years. Some savings in a 403b. My husband is retired/disable, gets an excellent pension. We have two homes with mortgages, and one car with a loan. A boat loan, and an ATV loan, we use for a snowplow. No credit card debt.

Is this possible? How,would we start being loan free from now on? Can you actually save for a car? Please give me hope, because I hate being beholden to big corporations.
Thank you,
Nancy
I would first recommend you no longer drive a car that, as you said, could be a killer. Second, you appear to have adequate income but only "some" savings in a 403b. Can you save more? A lot more? Enough savings equals freedom from loans.
"Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." ~Jack Bogle
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nydad
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Re: Never Want To Take Out A Loan Again.

Post by nydad »

Start by replacing that muffler! Sheesh! Carbon monoxide is serious business, and you can't smell it...

In order to be loan free, you need to reduce your consumption/discretionary spending to less than your income. It sounds like you have four loans - great that you don't carry CC debt, which is terrible, but the fact that you have loans for boats, ATVs and cars means you didn't have or didn't choose to spend cash on hand to purchase.

So if you want to be loan free, try to increase your income, and just don't buy anything unless you have enough cash to pay for it. A mortgage is an exception - I consider that a "good" debt, e.g. they're relatively cheap, you get a tax deduction reducing the effective interest.
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BL
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Re: Never Want To Take Out A Loan Again.

Post by BL »

Why two homes? Sell one and use any profit or at least the monthly savings in payments to pay off the car. Maybe sell the boat and/or the ATV when it quits snowing? Get some ideas on saving money from Dave Ramsey.
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

We took out the boat loan 10 years ago - they are as long as a mortgage! The ATV is a Work vehicle for plowing, or I could pay someone 75 dollars to plow my driveway every time it snows, which is quite a lot in upstate NY. Because of these loans, I have come to hate loans.

What does it mean to live below your means? We do very little, but with 2 kids in college, we are always paying for something.

And I appreciate the helpful responses. I figured I would get some snarky ones. :)
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

"Start by replacing that muffler! Sheesh! Carbon monoxide is serious business, and you can't smell it...

In order to be loan free, you need to reduce your consumption/discretionary spending to less than your income. It sounds like you have four loans - great that you don't carry CC debt, which is terrible, but the fact that you have loans for boats, ATVs and cars means you didn't have or didn't choose to spend cash on hand to purchase.

So if you want to be loan free, try to increase your income, and just don't buy anything unless you have enough cash to pay for it. A mortgage is an exception - I consider that a "good" debt, e.g. they're relatively cheap, you get a tax deduction reducing the effective interest."

Thank you for the advice. We are going to fix the car and save for a new one.
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

"Why two homes? Sell one and use any profit or at least the monthly savings in payments to pay off the car. Maybe sell the boat and/or the ATV when it quits snowing? Get some ideas on saving money from Dave Ramsey."

We are trying to sell the big home. No buyers yet. We have dropped the price considerably, but still...no takers. In the spring, we are going to paint it and spruce it up some more. We have renters now, we almost meet the mortgage amount. I would love to sell the boat, we can put it on the market in the spring, but may not get what we owe in this economy. Will check out Dave Ramsey.
camaro327
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Re: Never Want To Take Out A Loan Again.

Post by camaro327 »

Decide what recreational activity you like better and then sell either the ATV or the boat. Invest the proceeds (if any after paying off the loan) and use towards the next car.
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Re: Never Want To Take Out A Loan Again.

Post by midareff »

Beantown85 wrote:You have a car loan, two mortgages, a boat loan and an ATV loan. I'm wondering if you really hate loans.

Sure it's possible to save for a car. One way to help do that would be to not take out loans for things like boats and ATVs.
not to mention co-signing student loans that are not paid on time. You really don't sound like you are ready to retire in four years at 55 when medical insurance will likely be a new major expense besides the hand full of loans to pay. Maybe it's time to fix the muffler and drive the car for awhile rather than pickup another loan.
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

Thankfully, my husband has health insurance for life, and I can buying expensively from my work. I really want to sock away all that I can before I retire, and be almost debt free. Kids graduating from college are saddled with loans at high percentages, it is really quite criminal. I know lots of 22 year olds with 100k in loans, and these are kids graduating from top schools, and can barely pay them.

I am grateful for your advice. Thank you,
Nancy
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Re: Never Want To Take Out A Loan Again.

Post by p14175 »

My sister and her husband were (are) in a similar situation. A few years ago I fully expected them to be permanently living in an RV somewhere out in the desert. Anyway, my sister moved all their loans and credit cards to a local credit union to reduce the rates. They are living off her husband's income and all of hers is going to paying off the debt. It seems to be working.
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SC Hoosier
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Re: Never Want To Take Out A Loan Again.

Post by SC Hoosier »

BL wrote:Why two homes? Sell one and use any profit or at least the monthly savings in payments to pay off the car. Maybe sell the boat and/or the ATV when it quits snowing? Get some ideas on saving money from Dave Ramsey.
+1

Living below you means is a lifestyle of planned spending that is less than income. You are probably not budgeting, or living by a spending plan. Once you have your monthly expenses down on paper or, even better, on a spreadsheet, you can look to eliminate wasted dollars and thus increase savings. I think you would appreciate the elimination of 3 payments so that you could apply more money to a new car, existing debts and savings.

SC
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

Yes, we would love to have fewer payments each month. :)
guitarguy
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Re: Never Want To Take Out A Loan Again.

Post by guitarguy »

Read this, and follow the advice pretty closely. It's terrific advice for getting out of debt. (Although I'm not a fan of some of Dave Ramsey's investment advice).

http://www.amazon.com/The-Total-Money-M ... y+makeover

I'd certainly get rid of the boat and one of the houses ASAP. If you need/want the ATV to plow your driveway, keep it and pay off the loan.
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Re: Never Want To Take Out A Loan Again.

Post by Fallible »

Also check out our wiki on personal finance as it includes some areas you've mentioned. Here's the link: http://www.bogleheads.org/wiki/Category ... al_Finance

It would help also to read some good books. Here's another wiki link: http://www.bogleheads.org/wiki/Category ... nd_Authors

Overall, you could start with "Getting Started" on the wiki: http://www.bogleheads.org/wiki/Getting_Started
"Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." ~Jack Bogle
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SC Hoosier
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Re: Never Want To Take Out A Loan Again.

Post by SC Hoosier »

guitarguy wrote:Read this, and follow the advice pretty closely. It's terrific advice for getting out of debt. (Although I'm not a fan of some of Dave Ramsey's investment advice).

http://www.amazon.com/The-Total-Money-M ... y+makeover

I'd certainly get rid of the boat and one of the houses ASAP. If you need/want the ATV to plow your driveway, keep it and pay off the loan.
+1. Sell the boat and one house. Use the cash to pay off debt smallest to largest. Eliminate payments and as many expenses as possible.(ie. extra cell phones, dining out, cable tv, memberships, newspaper, until you are debt free.)
Last edited by SC Hoosier on Wed Feb 27, 2013 11:34 am, edited 1 time in total.
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HardKnocker
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Re: Never Want To Take Out A Loan Again.

Post by HardKnocker »

How to live at or below your means:

Own one home.
No boat.
No ATV (get a snowblower or shovel yourself).
Do not buy a car for your son.
Do not borrow to buy a car (buy used or pay cash).
Send kids to community college and state college (SUNY schools are cheap). Have kids live at home while attending college.
Do not do dog rescue or other altruistic endeavors if it impacts you financially. Look out for #1.

Get real. Fortunately you both have pensions to protect you from your mistakes.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
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SC Hoosier
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Re: Never Want To Take Out A Loan Again.

Post by SC Hoosier »

HardKnocker wrote:How to live at or below your means:

Own one home.
No boat.
No ATV (get a snowblower or shovel yourself).
Do not buy a car for your son.
Do not borrow to buy a car (buy used or pay cash).
Send kids to community college and state college (SUNY schools are cheap). Have kids live at home while attending college.
Do not do dog rescue or other altruistic endeavors if it impacts you financially. Look out for #1.

Get real.
I agree! Especially the points about your son. He needs to provide for himself because you are in no position to support him. He isn't going to support you when you run out of retirement funds.
I live in No Payment Land. It is wonderful, and I'd love for you to live here too.
WHL
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Re: Never Want To Take Out A Loan Again.

Post by WHL »

Sorry I can't provide any help for your current situation, but I just wanted to comment on your views of banks and loans.

I find it laughable that you feel they are "criminal." No one forces people to take out loans for boats, cars, houses, or school. If someone chooses to, they should understand exactly what they are doing. The onus is on the consumer.

I'm not trying to be aggressive or offensive, but it seems that you have brought your situation upon yourself. It's good you found these forums, and I hope you can find ways to cut spending, sell unnecessary assets, and pay down debt, but for those of us who responsibly use the products banks offer, I would appreciate you easing up on them :)
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

I am not trying to aggressive either, but we encourage kids to go to college, and the best college they can get into. Then they don't get enough financial aid, and ParentPlus loans are 8% and higher. This is thievery. These are kids trying to get educated.

And that you think banks are not criminal, I find laughable. My bank just got caught and has to pay 70 million + because if people overdrew their account, they would debit the largest amount first and then the other amounts, regardless of when they hit the bank, to get the greatest number of overdrawn fees. Criminal. I could give you a thousand other examples, but that is not the point of this thread. I find them criminal, and don't want to give them a penny more.
WHL
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Re: Never Want To Take Out A Loan Again.

Post by WHL »

And, FWIW, I don't plan to take out any bank loans, either. That's why I'm saving $750 / month in my "new vehicle fund." :)
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

Hard knocker,
Thank you for calling me stupid. You sure are helpful. And a really nice person. :)
WHL
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Re: Never Want To Take Out A Loan Again.

Post by WHL »

Nancylee wrote:I am not trying to aggressive either, but we encourage kids to go to college, and the best college they can get into. Then they don't get enough financial aid, and ParentPlus loans are 8% and higher. This is thievery. These are kids trying to get educated.
I surely don't want to get into an argument about finances, but there are plenty of ways to pay for school without large amounts of debt - working a job with tuition reimbursement, part-time jobs, military, etc. On the other hand, a college degree isn't for everyone, and there are plenty of blue collar careers paying gobs of money for people willing to work a trade. This is the route I took, and I'm very happily making more money than I know what to do with.
Nancylee wrote:And that you think banks are not criminal, I find laughable. My bank just got caught and has to pay 70 million + because if people overdrew their account, they would debit the largest amount first and then the other amounts, regardless of when they hit the bank, to get the greatest number of overdrawn fees. Criminal. I could give you a thousand other examples, but that is not the point of this thread. I find them criminal, and don't want to give them a penny more.
Sure, there are always going to be shady characters who abuse and take advantage of things. This isn't the norm, however. Read what you wrote - people who overdrew their account. Again, the onus is on the consumer. If they hadn't overdrawn their accounts...

I think we'll never agree, but a good discussion is always welcomed :)
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nydad
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Re: Never Want To Take Out A Loan Again.

Post by nydad »

depending on what school they go to, they might qualify for a SoFi loan. https://www.sofi.com/
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Re: Never Want To Take Out A Loan Again.

Post by Grt2bOutdoors »

Don't retire in 4 years. Retire later and use the money from your secure work to pay down your existing loans.
If you don't know how to save try this - if you have $100 at the end of the month after bills, take 1/2 and put it into an FDIC insured savings account - it may not make much interest, but at the end of 12 months you'll have $600 more than you have now. Do this for however long it takes you to build up enough to provide piece of mind for a decent used car, backup fund, what have you. I know things are depressed economically upstate (have been since the 70's), so now is no time to be thinking of early retirement at 55 unless you need to do so for health reasons. Downstater here and things are not that great here. You are fortunate to a)have a secure job and b) have a pension. Two things in very short supply these days, everywhere.

Don't ever take out a loan for unnecessary expenditures - that means things like a boat, car, vacation. If your kids are unable to pay their student loans, perhaps they can look into a revised payment plan or deferment? They will have to pay it back at some time though, it's not dischargeable.

Either you live up a steep and long driveway or you are in the mountains - you need a 4 wheeler with a plow?

I know 8% is a heck of alot to pay, but think of it this way - your son has many years in which to either pay the required payment or eventually save up enough to pay it all off at once or in nice fat or little chunks. Unfortunately, student loans today can be like mortgages, only the property is the value of the education. Do not give up hope! It might be another 20 years before we get out of this soup........ :shock: , I hope I'm wrong.
Last edited by Grt2bOutdoors on Wed Feb 27, 2013 12:04 pm, edited 1 time in total.
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Re: Never Want To Take Out A Loan Again.

Post by guitarguy »

WHL wrote:I'm very happily making more money than I know what to do with.
Take a run over to the Investments forum...someone will help you figure out what to do with it. :D
WHL
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Re: Never Want To Take Out A Loan Again.

Post by WHL »

guitarguy wrote:
WHL wrote:I'm very happily making more money than I know what to do with.
Take a run over to the Investments forum...someone will help you figure out what to do with it. :D
Haha, unfortunately, it's just a figure of speech. I could DEFINITELY use more money! I put something like 40k into retirement accounts last year.
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Re: Never Want To Take Out A Loan Again.

Post by Quickfoot »

Congratulations on making a decision most people never will. I agree with the previous poster, don't retire in 4 years, instead work until you are at least able to pay off the cars, ATV and boat. You will want to reduce your living expenses as much as possible and increase cash flow by paying off debt, especially if retirement is accompanied by an income reduction.

Yes it's possible to never take out another loan but it can be a long road to get there. I got divorced 4 years ago and my wife got divorced 3 years ago, we are just NOW starting to get back on our feet but we are paying off debt every month. Just like you need an investment plan build a debt repayment plan, also make small milestones with at least one achievable every 3 months otherwise you could get very discouraged.

Debt free living is a life long war, not a single conflict.

To cheer you up a little, I'm still paying $350 a month for plastic surgery for my ex wife that she got AFTER we divorced (guilt is a powerful thing).
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Re: Never Want To Take Out A Loan Again.

Post by Toons »

You might be a "candidate" for Dave Ramsey :happy . "The Seven Baby Steps"
(not affiliated)

http://www.daveramsey.com/new/baby-steps/
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Re: Never Want To Take Out A Loan Again.

Post by guitarguy »

Quickfoot wrote: I'm still paying $350 a month for plastic surgery for my ex wife that she got AFTER we divorced (guilt is a powerful thing).
:oops:
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Re: Never Want To Take Out A Loan Again.

Post by Default User BR »

Nancylee wrote:I am not trying to aggressive either, but we encourage kids to go to college, and the best college they can get into.
Yes to the first, NO to the second. They should go to the best that they can afford.


Brian
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Re: Never Want To Take Out A Loan Again.

Post by KyleAAA »

Nancylee wrote:I am not trying to aggressive either, but we encourage kids to go to college, and the best college they can get into. Then they don't get enough financial aid, and ParentPlus loans are 8% and higher. This is thievery. These are kids trying to get educated.
Well, somebody has to pay for it. Why should the bank? I don't understand how that's thievery. You need money. They lent it to you at a reasonable rate (yes, 8% is reasonable). Where's the thievery there? We don't know your circumstances, but at least on this thread you are coming across as too quick to "pass the buck," so to speak, when you've clearly made a number of questionable financial decisions all on your own. If you want good advice, you should probably tone down the rhetoric a bit. Railing against the system isn't going to help you or anybody else.

My advice: sell the boat. Sell the 2nd home. Pay off the ATV and car asap. Never borrow money again. You can get a safe, high-quality used car for your son for just a few thousand dollars. Pay cash, perhaps using the proceeds from the 2nd home or boat sale. Look into alternative ways to finance college; you don't necessarily need to take out huge loans. Take a long, hard look at whether or not going to a cheaper college makes more sense. Flagship state schools are usually every bit as good as the Ivies for a fraction of the price. Yes, what I'm saying is that Harvard and Yale aren't necessarily better than Michigan or Cal or North Carolina, but they can be much cheaper. Also realize that going to "the best school" isn't necessarily likely to increase their eventual salary. Often times, going to the best college you can get into ends up being a poor choice.
Last edited by KyleAAA on Wed Feb 27, 2013 12:32 pm, edited 1 time in total.
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

Thank you all for your excellent and kind advice. I don't have to,retire, it would be better for me mentally and physically, though. I have side work I do, I am a freelance writer, and artist, and can bring in money, at least with the writing. I can always make money, it's holding onto it that gives me fits.

I think we are going to,start with putting the 350 we would have spent on the new car in a bank account for a car, and focus on putting our old dining-out budget (we used to eat out once a week) toward the ATV first, since that is the closest to being paid off. Then list the boat (anyone want a rarely used 20 foot SeaRay?!.) for sale, and repaint the house and relist. It should sell if I can spruce it up,a bit.

Here is where I get into trouble. Lets say I want to start a garden and freeze veggies for winter. We have terrible soil, so I would need to either buy topsoil (a couple of hundred dollars) or compost for it, which we have been doing for two years. We used untreated wood for the beds, and buy seeds. But we get such a short growing season, I need to start them inside. Soil, heat, lights, or they die. But to buy plants is ridiculously expensive! Some berry bushes and started plants will run at least a hundred dollars! So even when I try to save money, it costs money. Our local markets have terrible produce, and closest good stores are 45 minutes away. Gas money.

Phones. I gave up my I-phone, I got the cheapest phone i could, my husband has no cell phone, but we have my college age daughter's phone. Plus house phone, because we get no cell service living in the country.

How do you win?
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

When banks are getting money to lend out at 2 or 3 %, charging college kids 8 or 9% is usury, in my view.
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Re: Never Want To Take Out A Loan Again.

Post by scone »

I can tell you how I did it, but you probably won't like it. I didn't have a car in high school. My first vehicle was a moped, bought used. I needed it because the bus line between work and school took too long. The moped was stolen, so I went back to the bus, and saved for a motorcycle, bought used.

When I finished school, I moved to the West Coast and borrowed my brothers' beater car. I saved for my own beater car, bought used. I saved up some more, and when the beater car finally died, bought a small motorcycle. I saved up some more, and many years later bought a year end base model B220 truck. Years and years later, after saving up even more, I traded in the B220 for a Honda CRV. This car even has air conditioning and a CD player-- WooHoo!

And that's my vehicular history. It took 25 years to get to this point. The pattern here is, don't start out spending all your money on loan interest. Instead, buy used, and save what you would have spent in interest (plus a bit more) to upgrade your vehicles over time, if you want to.

You can apply the same "loan avoidance through extreme saving" to other areas of your life. Once you start to think of it that way, loans become options rather than necessities. But it does mean living without things now-- postponing consumption. And that's where most people give up and go get a loan.
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Re: Never Want To Take Out A Loan Again.

Post by Toons »

"Here is where I get into trouble. Lets say I want to start a garden and freeze veggies for winter. We have terrible soil, so I would need to either buy topsoil (a couple of hundred dollars) or compost for it, which we have been doing for two years. We used untreated wood for the beds, and buy seeds. But we get such a short growing season, I need to start them inside. Soil, heat, lights, or they die. But to buy plants is ridiculously expensive! Some berry bushes and started plants will run at least a hundred dollars! So even when I try to save money, it costs money. Our local markets have terrible produce, and closest good stores are 45 minutes away. Gas money."


I would switch to canned or frozen vegetables and stock up :happy
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee
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Nancylee
Posts: 45
Joined: Tue Sep 25, 2012 7:21 am

Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

Thanks, scone, I like that! It is a good example of what can be done with patience. I am 51, I think it is time to cultivate patience. I will happily drive the 1994 Subaru- except for the exhaust pipe, the muffler and the holes in the door, it is fine, and I can get them fixed. It only has 104,000 miles on it!

No more loans!
WHL
Posts: 789
Joined: Mon Dec 10, 2012 1:22 pm

Re: Never Want To Take Out A Loan Again.

Post by WHL »

Nancylee wrote:When banks are getting money to lend out at 2 or 3 %, charging college kids 8 or 9% is usury, in my view.
The difference there is that money used for college typically has no revocable asset tied to it. If the "kids" don't pay, what are the banks supposed to go after to get their money?

Aside from co-signing parents, of course :mrgreen:
Last edited by WHL on Wed Feb 27, 2013 12:43 pm, edited 2 times in total.
Topic Author
Nancylee
Posts: 45
Joined: Tue Sep 25, 2012 7:21 am

Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

You are right, Toons! Thanks!

I really appreciate the reality of saving money and how it means giving up stuff. Is there a tightwad group to brag and encourage each other, kind of like an AA for spenders?
Topic Author
Nancylee
Posts: 45
Joined: Tue Sep 25, 2012 7:21 am

Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

That's true, WHL, and we realized,that if the economy didn't get better, we would be on the hook for the loans. Groan.
KyleAAA
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Re: Never Want To Take Out A Loan Again.

Post by KyleAAA »

Nancylee wrote: Here is where I get into trouble. Lets say I want to start a garden and freeze veggies for winter. We have terrible soil, so I would need to either buy topsoil (a couple of hundred dollars) or compost for it, which we have been doing for two years. We used untreated wood for the beds, and buy seeds. But we get such a short growing season, I need to start them inside. Soil, heat, lights, or they die. But to buy plants is ridiculously expensive! Some berry bushes and started plants will run at least a hundred dollars! So even when I try to save money, it costs money. Our local markets have terrible produce, and closest good stores are 45 minutes away. Gas money.
Build one of these. Cheap and ridiculously effective. They are popular in South America and they work great. The Peace Corp builds tons of them.
FillorKill
Posts: 1007
Joined: Sat Aug 06, 2011 7:01 am

Re: Never Want To Take Out A Loan Again.

Post by FillorKill »

How do you win?
Start with thinking that you can.

Having an internal locus of control and a positive 'can do' attitude is about 90% of it. The rest is education, planning and execution.

'can't' often means 'won't'

Approaching any challenge/obstacle as though it is a solvable problem and you just need to figure out the solution - no matter how difficult, unpleasant, tedious or time-consuming it may be.

Having a good attitude really does make a big difference.

Ignoring the gender reference Henry Ford nailed it:

“The man who thinks he can and the man who thinks he can't are both right. Which one are you?”
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mhc
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Location: NoCo

Re: Never Want To Take Out A Loan Again.

Post by mhc »

Nancylee wrote:Is there a tightwad group to brag and encourage each other, kind of like an AA for spenders?
You have found it. Stay around for a while and you will see that most of us fall into this group. We prefer to be called frugal or wise with our money. :D

Here's a current thread: http://www.bogleheads.org/forum/viewtop ... 1&t=111642

Really, the key is to learn to live below your means. You also mentioned something about "how do you win". You live in the country. Enjoy nature. You have a family. Enjoy them. You are an artist. Enjoy your passions. Do not get into the rut of competing with others or thinking that you have to have material objects to be complete.
52% TSM, 23% TISM, 24.5% TBM, 0.5% cash
Quickfoot
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Joined: Fri Jan 11, 2013 12:03 pm

Re: Never Want To Take Out A Loan Again.

Post by Quickfoot »

Absolutely where there's a desire there's a way, we find ways to pay for things we really want. I'd suggest putting together a realistic budget, leave 10-20% in addition to your budget for disposable income, and then setting up an automatic savings plan (they transfer money to savings account without you doing everything). You'll be amazed how fast you build up money.

You can also use pre-paid debit cards for portions of your budget, we do this with our grocery budget because it is our most variable bill. We budget $500 a month for groceries, anything that's left over of that $500 my wife gets to add to her disposable budget. The only real expenses coming out of our main checking account are monthly bills and auto fuel.

We've been through 3 custody battles in the last 18 months (think raising kids is expensive, try fighting for three of them), my wife has been laid off 3 times, and I inherited a significant amount of her debt. It got to the point where even though we make very good livings our financial stability was slipping and we were paying rent on the 15th instead of the first.

I had to put our family on financial lock-down for about 4 months (no dining out, no new toys, no play places, etc) but in 6 months we've paid $$$$$ to the attorney and at the same time paid off $$$$$ in debt with nothing in savings to pay for things with(divorce does that). We are now establishing a 1 year emergency fund and finishing paying off debt and have committed to retiring at 55.

A word of advice, get your husband on board. I've been able to show my wife how paying off / avoiding debt will allow us to have more stability and fun in both the short and long term than if we continued utilizing debt. If your spouse is breaking the budget / fighting against disciplined spending it will be impossible to stay on a budget. If he refuses then I'd get separate bank accounts and divide bills proportionately based on income percentages.

Also decide if you truly want NO loans or no loans outside car payments / mortgage. We have decided that we'll pay off all debt but she'll lease a new car every 3 years, it makes her happy and we have the financial resources to easily meet all our other obligations.
325e
Posts: 99
Joined: Thu Aug 09, 2012 8:48 am

Re: Never Want To Take Out A Loan Again.

Post by 325e »

It is great that you have taken a big step to improving yourself, and willing to put up with the heat you're getting. You are on the right path just by asking.

Take one step at a time. Look at the big items first and then start going down the list. You don't have to do everything at once.

Check out Dave Ramsey's book "Total Money Makeover".
Last edited by 325e on Fri Mar 01, 2013 3:39 pm, edited 1 time in total.
Grt2bOutdoors
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Location: New York

Re: Never Want To Take Out A Loan Again.

Post by Grt2bOutdoors »

Nancylee wrote:Here is where I get into trouble. Lets say I want to start a garden and freeze veggies for winter. We have terrible soil, so I would need to either buy topsoil (a couple of hundred dollars) or compost for it, which we have been doing for two years. We used untreated wood for the beds, and buy seeds. But we get such a short growing season, I need to start them inside. Soil, heat, lights, or they die. But to buy plants is ridiculously expensive! Some berry bushes and started plants will run at least a hundred dollars! So even when I try to save money, it costs money. Our local markets have terrible produce, and closest good stores are 45 minutes away. Gas money.

How do you win?
Just how big is your garden? To amend the soil, don't purchase top soil - it lacks nutrients. Head over to Home Depot or your nearest farm that doesn't mind giving away some horse manure or sheep manure (this will stink!) - take about 100lbs of it and mix it in the top 2 inches of the soil, let it sit for a couple of weeks to get the smell out - then turn the soil over - you don't want to burn the roots of the plants, so no direct exposure to manure, before you begin planting.
Now, this stuff can be expensive, so do it a bit at a time (over 2 or 3 years) - buy 3 or 4 bags of Peat Moss, spread it out on the soil and till it in as well - this will take your bad soil and make it good by holding on to moisture when it rains or you water the garden. If you get a bag of 10-10-10 pelletized fertilizer, sprinkle some of that in the garden soil - not next to or directly on the plantings (you'll burn the roots). That's it. The soil will get better over time, after about 3 years, it will be more about maintainance and less about having to drop big $$'s into it.

Don't waste your money trying to grow salad - buy swiss chard (seeds - plant directly outside) - it constantly regenerates and will go long into the season. String beans, tomatoes, sweet peppers, zucchini, eggplants. Haven't had much success with blueberries (fickle acid loving plants), try blackberries and raspberries (Miller's Nurseries in Canidiuaga).

How short is the season? You should be good until late August, start in late April/early May.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
Topic Author
Nancylee
Posts: 45
Joined: Tue Sep 25, 2012 7:21 am

Re: Never Want To Take Out A Loan Again.

Post by Nancylee »

I am a can do person! I thought I could rescue thousands of dogs a year from the south, and I did! Almost bankrupted is, but,hey, I did it. We can do this, I just needed advice and a plan.

One other question - I am pretty ADD, and getting worse the older I get. Are there any apps or programs for free that help keep track of spending and or budgets? I have an I-pad 2, given to me by a techie friend when he just had to get the newer one! I love technology, and started using a bill paying reminder program, but so many of them I look at make my eyes glaze over.

Thanks,
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