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

Post by Quickfoot » Wed Feb 27, 2013 2:45 pm

There are tons of apps, some free, some almost free, just search the market / app store for budget planning and look at the reviews.

You might take a look at mint.com as well.

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bertie wooster
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Re: Never Want To Take Out A Loan Again.

Post by bertie wooster » Wed Feb 27, 2013 3:06 pm

Congrats on realizing that you are too far into debt and 1) realizing you need to make a change and 2) starting to take the steps to initiate change. This is a big deal! But you need to be disciplined to make this happen. Start budgeting and start cutting unnecessary expenses (such as cable, smart phones, eating out, new clothes, etc.). Also - your kids need to pay for their own phones/cars/tuition because you and your husband simply cannot afford it. Have them consider looking at state schools or community colleges and they need to get a job to help cover the costs (and they should be able to get student loans w/o you cosigning I would think).

Retirement in a few years does not seem like a good idea based on what you've revealed about your financial situation. Work until you've paid off the boat and ATV and sold the 2nd house. Your only debt should be your primary house mortgage (and in general that should be close to paid off by retirement). You're very young, so I think continuing to work is a good option unless you have significant health problems.

I think a big obstacle for you is that you have a victim's mentality. It's important to realize that your current situation is the result of your decisions. Not the banks or society or college or your children or your ADD. Once you own your current situation you'll be in the right mindset for improving it.

You've taken a big first step! Now it's time to buckledown and make some significant changes in your life. Living below your means is a way of life.

Good luck!

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

Post by SC Hoosier » Wed Feb 27, 2013 3:19 pm

Nancylee wrote: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?
Gardening is not going to change your financial situation significantly for the better, so stop looking there. I like the farmers market suggested by a poster below. Your daughter must pay for own phone. Also, to the tuition discussion, community colleges are almost free. There are a lot of excuses for why you aren't able to improve your situation. Your circumstances are a result of poor past choices. You chose where you live and your cell phone provider. Do you need a cell phone if you have a home phone?We all lived without them 25 years ago. If your decisions get better, so will your situation. Let your goal of retirement in a few years spur you to make drastic changes. Financial Peace University from Dave Ramsey would be such a blessing to you. Please do it.
Last edited by SC Hoosier on Wed Feb 27, 2013 3:42 pm, edited 1 time in total.
I live in No Payment Land. It is wonderful, and I'd love for you to live here too.

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

Post by Nancylee » Wed Feb 27, 2013 3:23 pm

Bertie,
I do not have a victim's mentality! I know I have made stupid decisions, but I have never been a victim. I believe that I have the power to change the world, and definitely myself, and am looking for ways to do so. No one else caused my financial issues, BUT the decks are stacked against the little people, because we don't pay attention, while The Man does.

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

Post by guitarguy » Wed Feb 27, 2013 3:30 pm

Nancylee wrote:I do not have a victim's mentality! .....BUT the decks are stacked against the little people, because we don't pay attention, while The Man does.
With all respect, YOU not paying attention does not mean the decks are stacked against you. In fact, saying that the decks are stacked against you is precisely playing the role of being a victim, which I think is what the previous poster was alluding to. YOU just need to educate yourself and make better decisions, which is what you're doing here. :wink:

BTW, being a huge dog person, thank you for your contributions with rescuing. However, make sure not to compromise your financial stability in trying to overdo it. We took in a friend's dog that would've went to a shelter if we hadn't taken him. Every little act helps.

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

Post by fourwaystreet » Wed Feb 27, 2013 3:36 pm

Just my two cents.............Don't cosign any more loans for your children, learn to say no. If the kids can't afford their college cost they should take some classes at a community college, go part time or attempt to transfer to a SUNY school. There are several SUNY schools that are highly regarded (Geneseo, Binghampton, Univ. of Buffalo, Albany, Cortland and Brockport all located in Upstate NY by the way.) Or God forbid your kids could get a job to help pay their way.

Work longer than four more years and if your pension is that robust, retire then get another job and double dip for awhile. Your health care costs should be resonable when you retire (assuming here that you work for the gov't)

Sell the boat for what you can, pay off the loan and put the remainder to whatever is the highest % loan you have.

Buy your fruits and veggies at any one of the numerous farmer markets that Upstate NY has and freeze as necessary.

Unless you have a excessively long driveway and I mean plantation length driveway nobody pays $75.00 to have their driveway plowed per snowfall. The cost for a avg size driveway is about $250.00 per season

Good luck
Last edited by fourwaystreet on Wed Feb 27, 2013 3:39 pm, edited 1 time in total.

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

Post by SC Hoosier » Wed Feb 27, 2013 3:37 pm

Nancylee wrote:Bertie,
I do not have a victim's mentality! I know I have made stupid decisions, but I have never been a victim. I believe that I have the power to change the world, and definitely myself, and am looking for ways to do so. No one else caused my financial issues, BUT the decks are stacked against the little people, because we don't pay attention, while The Man does.
The only deck that is stacked against anyone is not paying attention, as you said. Now that you are paying attention, you can start to win with money. :D :moneybag :dollar
I live in No Payment Land. It is wonderful, and I'd love for you to live here too.

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

Post by mrspremise » Wed Feb 27, 2013 3:41 pm

Nancylee wrote: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,
I personally like "Mint.com" which is owned by the same company that does Quicken.

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

Post by reggiesimpson » Wed Feb 27, 2013 5:38 pm

Lots of good advice here. Frankly i have never had a lone in my entire life (65 yoa). Cant stand the idea like you and most people. May be a bit of a shift for you at this point in life but if you want to really do it and i mean really want do it then start slow. As folks have suggested here its time to get rid of stuff. Dont take out anymore loans ......ever. Pay cash as much as possible. Take the savings and sock it away. The joy of doing this will slowly overtake you. It will take time but its well worth it.
BTW....fix the muffler.

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Re: Never Want To Take Out A Loan Again.

Post by eaglesfogbowl » Wed Feb 27, 2013 5:44 pm

Reading through the responses and the dialogue taking place really helps me realize that this is truly not a normal internet forum. I'm always impressed with the amount of patience shown to new people.

That being said, when you said that you can make money any time, but once you have the money it slips through your fingers (paraphrasing) tells me that you might not be telling your money where to go quite as well as maybe you should be. Set up a budget. If you have one already, tighten it down and eliminate some "stuff" to clear monthly cashflow.

I also agree with the posters commenting about the victim's mentality. Just in this thread alone we've seen the blame placed on the banks, the soil, etc. If you're fed up enough with where you are, you'll do something about it. If you're not, you won't. Your biggest problem is going to be flipping the switch on the interest equation and making the determination that you'll minimize what is going out to lenders and after that maximize what comes in. Do the math and set up amortization schedules on each of your outstanding loans - you will be AMAZED at how much free money is going out each month. Searching the internet is a powerful thing.

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

Post by MNwildcat » Wed Feb 27, 2013 6:33 pm

It is tough to read objectively when the topic is of a personal matter. My recommendation is to take the day to absorb some of the very good advise from this thread, sleep on it, and reread it again to let it soak in more. The people responding have the similar passion to helping people with financial advise as you do with saving dogs.

The overall process is the same that everyone here is learning, has learned, or executed:

1) If you earn X amount. Don't spend more than X.
2) If you have debt, pay off the most expensive debt first, then the next most expensive, and so on.
3) Save as much as you can for the future (emergencies, retirement, college, automobile, etc...). (I have learned that this is very complicated myself, but love the challenge and learning).

Good luck and keep asking questions! The ony dumb one is the one not asked.

MNwildcat

Curlyq
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Post by Curlyq » Wed Feb 27, 2013 7:01 pm

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Last edited by Curlyq on Thu Oct 18, 2018 7:44 pm, edited 1 time in total.

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

Post by Nancylee » Wed Feb 27, 2013 7:17 pm

Yes, CurlyQ!
I write post-it notes and forget to look at them. Get bills, put them away for later, and never remember them. I started getting worse in my 40s, when I stopped smoking cigarettes. (Link between nicotine and dopamine has been found.) My ADD has gotten worse every year. I appreciate the ideas,and recommendations. Thank you!

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

Post by clacy » Wed Feb 27, 2013 10:05 pm

Nancy, wish you well but you really do sound like you're blaming the people that loaned you money for your leveraged position.

I can't tell you anything that hasn't been said, but I think it's sort of ridiculous to complain about debt, and "being beholden to big corporations" and "screwing the little guy" in the same post that you're talking about retiring at 55, while you have mortgages for two home loans, an auto loan, a boat loan and an ATV loan. You chose to buy boats and ATV's and then question why a bank would damage your credit and require a high interest rate for missed payments on your kid's student loans (that you co-signed).

I do wish you the best, but if you don't take ownership of your decisions, both past and present, you will have a very hard time becoming debt free.

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

Post by Nancylee » Thu Feb 28, 2013 6:39 am

Thank you to all who offered help. To the scolds who don't read very well, I have a pension, as does my husband. I have lots of interests and other ways to make money than just my full time job. I admit I have made mistakes, while also acknowledging the fault of the corporations and banks in this country, which are not friendly to the little guy. If you don't see that, well, no one is more blind than those who refuse to,see. i am well read, and smart enough to know that. I shared some info, not other info, but there are always those who love to call names and characterize others, and how easy for you to feel superior on an anonymous blog. I understand that it makes you feel superior, like you could never make the mistakes i made, because you are not a "Victim." I think you Negative Nellies ruin it for everyone else. I will be certain to not ask for advice again, because it comes with a whole pile of scorn.

Again, thank you to those who offered real suggestions,
Peace,

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

Post by guitarguy » Thu Feb 28, 2013 7:35 am

Nancylee wrote:I think you Negative Nellies ruin it for everyone else. I will be certain to not ask for advice again, because it comes with a whole pile of scorn.
Well, best of luck.

The fact is this forum is filled with a lot of knowledge, and the only loss will be your own.

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

Post by prudent » Thu Feb 28, 2013 8:43 am

It's short-sighted to stay away because some people said things you didn't like. You will never find another site that has more people who know what they are talking about and are willing to help.

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

Post by lightheir » Thu Feb 28, 2013 8:52 am

I might be over-reaching, but I suspect you're trying to compare the loan experience you had years ago before the recent great recession to the current reality.

My wife and I got preauthorization for a home mortgage that works out to only 1.3x multiple of our combined one-year pretax income. We're both physicians so the income is extremely stable. We had zero debts outside of her student loan (which are admittedly large but @ 3.5% interest) and had a pretty respectable portfolio of cash and investments on top thanks to prudent savings even over the lean years of training.

The raft of paperwork and scrutiny was incredible for this mortgage that happened 2.5 years ago. They even wanted paperwork down to a letter from my residency director that affirmed that I truly went there for training, and this was what would be considered a top-tier institution. And then even with everything in perfect order, the lender came back and cut down the amount they would lend by 10%. The amount of paperwork I submitted for that mortgage exceeded the amount of paperwork required to get into medical school or get board certified medical licensure.

I can't help but feel that if it was this hard for us with our income/debt/asset levels, it's no surprise that you're encountering what you are. It's the unfortunate (or fortunate, if you look at it from the recession-proofing perspective of avoiding financial bubbles) reality of today's economy.

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

Post by MathWizard » Thu Feb 28, 2013 5:52 pm

Nancy,

Please don't turn away from good advice because of some of the comments.

You are actually right about the fact that not having money puts you at a disadvantage
in financial transactions. I saw it first hand.

I grew up in a family that did not have money. We were the poorest family in our
small town, and everyone knew it. The family had no insurance other than the required liability
insurance on the family car. When my father was severely injured, my mother was taken
advantage of in financial dealings because others knew she was in a tough position and
had sell things to pay medical bills and keep food on the table.

I have shown my sons this kind of thing. Just look at CD rates. If you can put $25000
in a CD, you can get a much better interest rate than if you put $500 in. This is for the
simple reason that the bank has to do the same amount of work to process the two CDs, so
percentage-wise the costs they have associated with the $25,000 CD are much less, and they
must pass that savings along to the CD holder lest she take her business elsewhere.

If you are richer, not only do you have more money to make money with, but you can make it
at a faster rate.

The thing is though, you need to use this knowledge to your advantage. You are doing this
by wanting to go from negative interest rates (loans) to positive rates (savings/investments).
How do you do this? Clearly to pay off loans, you need to spend less.

Those who you think are giving you snarky comments are seeing you headed for a brick wall
and want you to focus on changing course and not cursing whatever caused you to get into that
situation.

With the earnings you have reported, it should be possible to get out of debt, and be headed for
a good life. This will take time, so you shouldn't get discouraged if it takes you more than
4 years to be able to retire.

For what it is worth, I'm 55, the age at which you want to retire, and the only debt I have is
a small mortgage debt that I could pay off now if I wanted to. I have one child in college,
and another headed there, and we pay their tuition. I also have a fair amount of retirement savings, but
it will probably be at least another 7 years before I can retire.

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

Post by KyleAAA » Thu Feb 28, 2013 6:23 pm

MathWizard wrote: If you are richer, not only do you have more money to make money with, but you can make it
at a faster rate.
I'm not sure I agree with this. Barring your CD example, there are MANY high-paying CDs out there with low minimums. What higher-yielding investments do the rich really have access to that the middle class doesn't? Hedge funds? Those don't really beat the market consistently. I can't really think of any.

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

Post by MathWizard » Thu Feb 28, 2013 7:09 pm

KyleAAA wrote:
MathWizard wrote: If you are richer, not only do you have more money to make money with, but you can make it
at a faster rate.
I'm not sure I agree with this. Barring your CD example, there are MANY high-paying CDs out there with low minimums. What higher-yielding investments do the rich really have access to that the middle class doesn't? Hedge funds? Those don't really beat the market consistently. I can't really think of any.
When GE was in trouble, they did not turn to me and offer me Preferred Shares at a 20% dividend, they went to Warren Buffet.
(Yes, I'd have taken 20% preferred shares in GE, even then. I believe in indexing, but a nearly sure 20% just to get them the
cash flow to weather a storm is a pretty safe bet.)

I am not complaining about this, it is just that concentrated money has a greater utility, otherwise you have all the costs
of rounding up the money. That is essentially what investment banks make their money at, if you are a Very High Net Worth
Individual, you can be an investment bank, and cut out the middle man.

I suspect that you can think up lots of examples.

Just think of the costs associated with getting a million dollar gross income from ten million transactions versus 100 transactions.
A ten cent transaction cost wipes out your profit from the first. A $100 transaction cost on the second is only 1% of gross.

This does not mean people are taking advantage of others, it is just that there are transaction costs in business, and
you can usually make more profit from larger transactions.

I use the CD example with my kids because that is something that my children can see.
They've never been involved in business.

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

Post by SpaceCommander » Thu Feb 28, 2013 7:24 pm

May I suggest http://www.savvymoney.com This could be a helpful tool if you need help with a structured plan and monitoring.

JC
I honor my personality flaws, for without them I would have no personality at all.

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

Post by nydad » Thu Feb 28, 2013 9:22 pm

What higher-yielding investments do the rich really have access to that the middle class doesn't? Hedge funds? Those don't really beat the market consistently. I can't really think of any.
Even vanguard gives discounts to those with more money (admiral shares / institutional shares). I think this is normal, and many posters here are glad to graduate to admiral funds. Less expense == higher yield, by definition. There are also plenty of investments that only wealthy people have access too - see rules on "accredited investors" - not only hedge funds, but private equity, etc. Not saying these do better...

But I think there's another thing - if you have a lot of money, even earning a small amount could be enough to cover your basic living expenses. I wouldn't be surprised if many fabulously wealthy people do *worse* overall on their portfolios in terms of CAGR than the top bogleheads here (exactly because they are in expensive hedge funds, paying expensive advisors, investing in dodgy business schemes, etc), but a 5% gain on 10 million is worth a lot more than 10% gain on $500,000 - most people pay the same basic prices for goods and services, so the rich have an advantage because many of their gains may be taxed at the cap gains rate (instead of as income), and that income, even if marginal, goes a long way.

Absolute values matter just as much as percentage gains. This is also why you see many bogleheaders encouraging young, early savers to focus on their career, as that is a much bigger determinant of net worth in the long term than 1 or 2 extra percentage points at age 25 of a $10k portfolio.

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

Post by Nancylee » Fri Mar 01, 2013 7:41 am

Thank you to you kind sharing folks, I am a smart person in every other aspect of my life and it is embarrassing to be such a dolt when it comes to money,

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

Post by Fallible » Fri Mar 01, 2013 8:14 am

Nancylee wrote:Thank you to you kind sharing folks, I am a smart person in every other aspect of my life and it is embarrassing to be such a dolt when it comes to money,
You're not a "dolt" about money, either. You recognized the loan problem, decided to do something about it, came to this good site to ask good questions, and now plan to put the advice to work. That's smart.
:thumbsup
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Nancylee
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Re: Never Want To Take Out A Loan Again.

Post by Nancylee » Fri Mar 01, 2013 8:22 am

Thanks, Fallible. :) I have decided to take charge of our finances, so I don't live the rest of my life with worries, as I did up to now. Dave Ramsey said in the book i got yesterday that you have to,get mad to make changes, and being given a really high rate for a car loan got me really angry, mostly at myself.

We bring in a decent income, it is ridiculous that I got us into this situation. I am proudly driving around the 1994 Subaru, have an appt to get the muffler fixed. It's a weird feeling, when I left the library yesterday and saw my old, beat up,car, I got kind of a perverse pleasure in knowing that it is paid for and that I am not falling into the trap of paying 495 dollars per month to LEASE a Honda CRV! Forget about buying, which we always do. That was upwards of $650! For a CRV! I will save for a used one and buy it cash.

Great advice here, thank you,
Nancy

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

Post by nydad » Fri Mar 01, 2013 8:36 am

Now you're starting to sound like a boglehead! I'm glad
You found this board, it really is one of the best
Places in the internet for this kind of advice
And the people who post here are so generous
With their time and wisdom...

Sidebar: I wonder what you'd get if you added up all of the money
Collectively saved as a result of good advice on this
Board - it might be a significant sum! (Peanuts compared to
Vanguard, but still...)

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

Post by Fallible » Fri Mar 01, 2013 8:37 am

Nancylee wrote:Thanks, Fallible. :) I have decided to take charge of our finances, so I don't live the rest of my life with worries, as I did up to now. Dave Ramsey said in the book i got yesterday that you have to,get mad to make changes, and being given a really high rate for a car loan got me really angry, mostly at myself.

We bring in a decent income, it is ridiculous that I got us into this situation. I am proudly driving around the 1994 Subaru, have an appt to get the muffler fixed. It's a weird feeling, when I left the library yesterday and saw my old, beat up,car, I got kind of a perverse pleasure in knowing that it is paid for and that I am not falling into the trap of paying 495 dollars per month to LEASE a Honda CRV! ...
The enormously satisfying pleasure of being paid up and frugal has been described many times on many threads on this site. If you haven't seen the frugal topics, there's one going now and here's a link to one of my favorites: http://www.bogleheads.org/forum/viewtopic.php?t=36680

There also are topics on financial mistakes we all make: http://www.bogleheads.org/forum/viewtopic.php?t=37041
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

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

Post by lightheir » Fri Mar 01, 2013 9:29 am

[off-topic comments (along with one response) deleted by admin alex]

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

Post by ziszew » Fri Mar 01, 2013 12:16 pm

lightheir wrote: <<snip>>

When the top 1% pays on average 15-20% income taxes, that is NOT a level playing field.

<<snip>>

It's hard for me to point to the investment climate as "fair" with legal and tax codes that clearly show otherwise, and from what I've read, most economists would agree on this point at our country's current state. Being nonwealthy is a huge disadvantage in terms of gaining future wealth, period.
Lightheir,

According to the most recent available published data from the IRS (2009) your numbers are a bit off for "the rich":

Average Effective Federal Tax rate (percent of AGI paid):

Top 1% = 24.01%
Top 5% = 20.46%
Top 25% = 14.68%
Middle 50% = 5.56%

Percent of total AGI earned by each (aka their "slice of the pie"):

Top 1% = 16.93%
Top 5% = 31.72%
Top 25% = 65.81%
Middle 50% = 20.71%

Percent of Federal income tax revenues paid by each:

Top 1% = 36.73%
Top 5% = 58.66%
Top 25% = 87.30%
Middle 50% = 10.45%

While outliers will exist in any group and be highlighted in an attempt to skew public perceptions, the actual data paints a different picture.

As to income inequality and wealth accumulation, that's a political argument and not for discussion here. That, and one of the more difficult concepts for many people to grasp is that one doesn't necessarily equal the other. There are people that are in the top 1% of earners living paycheck to paycheck, and those much lower down the income ladder with a large asset base of savings, pension, etc.

As to "fair", I've always gotten a kick out of this video on redistributing GPA points; it's got an obvious political tilt but the comparison is interesting along with people's reaction (it's not "fair" because the GPA points were "earned").

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Re: Never Want To Take Out A Loan Again.

Post by reggiesimpson » Fri Mar 01, 2013 12:17 pm

Nancylee wrote:Thanks, Fallible. :) I have decided to take charge of our finances, so I don't live the rest of my life with worries, as I did up to now. Dave Ramsey said in the book i got yesterday that you have to,get mad to make changes, and being given a really high rate for a car loan got me really angry, mostly at myself.

We bring in a decent income, it is ridiculous that I got us into this situation. I am proudly driving around the 1994 Subaru, have an appt to get the muffler fixed. It's a weird feeling, when I left the library yesterday and saw my old, beat up,car, I got kind of a perverse pleasure in knowing that it is paid for and that I am not falling into the trap of paying 495 dollars per month to LEASE a Honda CRV! Forget about buying, which we always do. That was upwards of $650! For a CRV! I will save for a used one and buy it cash.

Great advice here, thank you,
Nancy
Yes and that "perverse pleasure" will turn to pure joy as you start to seriously sock away the extra funds. It becomes a very pleasant habit. Congratulations.

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Re: Never Want To Take Out A Loan Again.

Post by KyleAAA » Fri Mar 01, 2013 12:30 pm

reggiesimpson wrote:
Nancylee wrote:Thanks, Fallible. :) I have decided to take charge of our finances, so I don't live the rest of my life with worries, as I did up to now. Dave Ramsey said in the book i got yesterday that you have to,get mad to make changes, and being given a really high rate for a car loan got me really angry, mostly at myself.

We bring in a decent income, it is ridiculous that I got us into this situation. I am proudly driving around the 1994 Subaru, have an appt to get the muffler fixed. It's a weird feeling, when I left the library yesterday and saw my old, beat up,car, I got kind of a perverse pleasure in knowing that it is paid for and that I am not falling into the trap of paying 495 dollars per month to LEASE a Honda CRV! Forget about buying, which we always do. That was upwards of $650! For a CRV! I will save for a used one and buy it cash.

Great advice here, thank you,
Nancy
Yes and that "perverse pleasure" will turn to pure joy as you start to seriously sock away the extra funds. It becomes a very pleasant habit. Congratulations.
True dat. I can't wait until the end of the month when I get to transfer any excess money in my checking account into my taxable portfolio. Sometimes it's a lot, other times it's almost nothing because I have to replenish my emergency fund for some reason.

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Re: Never Want To Take Out A Loan Again.

Post by The Wizard » Fri Mar 01, 2013 12:44 pm

Nancylee wrote:Thank you to you kind sharing folks, I am a smart person in every other aspect of my life and it is embarrassing to be such a dolt when it comes to money,
"Dolt" is over-stating your situation, as others have said.
The problem for some people is: it's perfectly legal to do lots of stupid financial tricks.
Buying a car (or a house) with no money down is a bad idea.
Carrying a continuing credit card balance is a bad idea.
Getting and rolling over PAYDAY LOANS is a TERRIBLE idea.

But people do all of these things, for various reasons.
Learning the right things to do and developing discipline to do them is a healthy change for many folks...
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Re: Never Want To Take Out A Loan Again.

Post by Winthorpe » Fri Mar 01, 2013 4:41 pm

Nancylee,

I also think you would benefit in a huge way by doing the Dave Ramsey Total Money Makeover. Go all in, get your husband on board, and you should be able to clean things up. However, once you get to the investing part, leave Dave behind and get much better advice here.

Good luck.

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Re: Never Want To Take Out A Loan Again.

Post by zebrafish » Fri Mar 01, 2013 10:22 pm

Listen to Dave Ramsay show podcast or on radio for a few weeks. He is perfect for where you are currently. You can make excuses for continuing to go into debt or you can get angry and dig yourself out. Sounds like you are close.

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Re: Never Want To Take Out A Loan Again.

Post by celia » Fri Mar 01, 2013 11:13 pm

Nancy, Here's a good goal for you: Pay off all your loans BEFORE you retire, even if you have to extend your retirement date. This may mean selling off some of your assets, but believe me, the peace of mind of not having loans hanging over your head makes retirement more enjoyable.'

Many people on this forum have never had any of the kinds of loans you have, except for a mortgage; a few have even never had a mortgage, but saved up to buy a house they could afford. It can be done. Just join the thousands that have been building up their savings while retiring debt since the 2008 market crash. Overall, we are over-extended, but don't need to be. One by one, people are paying attention to their finances and making adjustments.
A dollar in Roth is worth more than a dollar in a taxable account. A dollar in taxable is worth more than a dollar in a tax-deferred account.

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Re: Never Want To Take Out A Loan Again.

Post by SurfCityBill » Fri Mar 01, 2013 11:18 pm

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 on Dave Ramsey, but limit his advice to eliminating debt. Look elsewhere for investment information.

-B

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Re: Never Want To Take Out A Loan Again.

Post by natureexplorer » Fri Mar 01, 2013 11:20 pm

Nancylee wrote: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.
[Personal attack removed by admin LadyGeek]

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Re: Never Want To Take Out A Loan Again.

Post by celia » Fri Mar 01, 2013 11:27 pm

Curlyq wrote:. . . In the case of the late payment, it was a credit card payment and after the late payment, I set up an automatic monthly payment to my credit card every month that well-exceeded the minimum and was generally more than the average monthly amount charged so that I avoided any further penalties. I'm happy to say that I'm now at the lowest interest rate possible that this bank charges for credit card customers due to my always on-time payments. I don't know how some (or most) people can pay their credit cards off monthly on their own, without being late or forgetting. I just can't do it.
I don't understand this. You provide your own answer by using automatic monthly payments to allow the credit card company or loan company to debit your checking account. There's nothing to remember and you're never late this way. Of course, you have to be sure the money to pay the credit card/loan is in the account each month. If you don't have the money in your checking each month, then you can't afford the credit card/loan.
A dollar in Roth is worth more than a dollar in a taxable account. A dollar in taxable is worth more than a dollar in a tax-deferred account.

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Re: Never Want To Take Out A Loan Again.

Post by Nancylee » Sat Mar 02, 2013 6:46 am

[Response to personal attack removed by admin LadyGeek]

Thank you, all, I am looking into the Money Makeover program. I am trying to find out how much it costs! :)

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Re: Never Want To Take Out A Loan Again.

Post by Nancylee » Sat Mar 02, 2013 6:48 am

CurlyQ, you have been incredibly helpful with your organization help. Thank you,
Nancy

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Re: Never Want To Take Out A Loan Again.

Post by guitarguy » Sat Mar 02, 2013 8:20 am

Nancylee wrote:Thank you, all, I am looking into the Money Makeover program. I am trying to find out how much it costs! :)
The book isn't expensive...maybe $10-15 on Amazon tops. Or you could even see if your library has it. Trust me, read it. It's well worth your time.

It will also "cost" you time and effort to make lifestyle and attitude changes. Your ROR on your time and commitment investment will pay off in spades.

P.S. I'm glad you didn't leave the forum. The amount of advice and knowledge here is priceless. You do have to have thick skin though...people on here tell it like it is. Once you get your situation in order and come back to update us on how well you're doing and how happy you are after making your life/financial changes, the compliments and congrats you receive from the members here will be just as numerous as the critiques that got you going.

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Re: Never Want To Take Out A Loan Again.

Post by timmy » Sat Mar 02, 2013 8:45 am

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Re: Never Want To Take Out A Loan Again.

Post by Mudpuppy » Sat Mar 02, 2013 3:06 pm

More so than any program, the best key to getting control of your financial life is to change your attitude towards money to be proactive instead of reactive. You need to make budgets, track spending, read the fine print of any financial document, distrust anyone trying to sell you something financially related, and so forth. That is being proactive. The idea is to plan and anticipate what you will do with your money and also try to anticipate and fend off all of the sharks who might try to separate you from your money. Being proactive is taking charge of your finances and taking responsibility for any mistakes you might have made (but don't beat yourself up over the mistakes; learn from the mistakes).

If one is instead reactive, one doesn't do these things and then gets surprised when something bad happens. This can lead to anger/disappointment/resentment/etc at one's self and at others. It often leads to initially lashing out and blaming others, even if eventually one comes to realize what mistakes one might have been made. It's important to realize when one is being reactive, to take a step back emotionally, and to reassess the situation to see if one might have been able to do something differently along the way to prevent the outcome. This is how one learns to recognize one's mistakes, how to learn from one's mistakes, and how to figure out proactive steps to take to prevent such situations in the future.

Okay, enough of that soapbox. I think you've already made the first steps towards being a proactive person by seeing the criticisms here and not running away from them. I don't think you need Dave Ramsey's program or any other program that costs money. You just need to keep working on financial skills, which includes one's emotional relationship with money.

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Re: Never Want To Take Out A Loan Again.

Post by guitarguy » Sat Mar 02, 2013 5:31 pm

Mudpuppy wrote:I don't think you need Dave Ramsey's program or any other program that costs money.
All it will cost you is the price of the book...that is if you can't just get it from the library. If you do need to buy it to read it, it's worth the $15. Again, I think it will help you. It's very motivational and informative.

P.S I'm in no way affiliated with Dave Ramsey.

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Re: Never Want To Take Out A Loan Again.

Post by LowER » Sat Mar 02, 2013 6:02 pm

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

Post by chipperd » Sun Mar 03, 2013 6:34 am

I agree with all who have suggested that you set up a budget and spend less than you take in and I would add plan for that next emergency. While I am not a fan of Dave Ramsey's investment advice (as someone mentioned above) my wife and I ( and kids) are in his "Financial Peace University" 9 week class now. Reasonably priced ($95) for the nine weeks with book and dvd's you keep, the structure and support will work for anyone, when followed. You can find a class on his website. Good luck!

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Re: Never Want To Take Out A Loan Again.

Post by scubadiver » Sun Mar 03, 2013 11:26 am

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.
Nancylee,

I would argue that the "usury" rates are entirely avoidable. I was born and raised in upstate New York. Attended community college and SUNY school for undergrad and found that option provided a high quality and affordable education. I did in fact choose to take out loans to finance portions of my education. It was a choice I made at the time and in retrospect there is a lot I could have done to avoid that - live and learn I guess. In any event, no one put a gun to my head forcing me to take out the loans.

You have gotten some very good advice in this thread and I'm glad (for you) to hear that it sounds as though you plan to follow it. I know you've expressed some frustration with the "scorn" and I didn't help by adding a bit of my own above. Sorry, that's the way it is. As you are discovering, this is an outstanding forum for (free!!!) financial guidance. Sympathy. Not so much. Particularly when your biggest problem is your own decision making. Truth be known though, many of the posters here are themselves former victims of their own poor decision making. Keep that in mind.

Anyway, I don't have much new to offer. Just some encouragement.....ok, maybe you should sell the ATV. I shoveled many driveways in my day. Unless yours is extremely large I'm guessing you can get by with a cheaper alternative.

Good luck.

Scubadiver

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