Tackling debt....Dave Ramsey...Suze Orman....others?

[Jcrew]

Useful link

web page

[eastbay]

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I don't know how Suze Orman is considered an expert. All she does is state the completely obvious. If you buy her list on how to get out of debt it will basically say this:

1. Stop buying $8 coffees at Starbucks every day. If you order 3 of these per day, you will save $24 per day. That is $8,670 a year i just saved you! (even if you don't drink coffee I am still going to count this as money that I just saved your because I know everything, and women are better than men too).

2. Increase your deductibles. You probably don't even have a deductible on your car insurance because your such an idiot. Well make it $1,000. This will save you like $500 a year.

3. Stop using premium gas. Regular unleaded works just as well, and btw, did you know that it is cheaper? Bam! I just saved you another $250 per year.


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4. Pay off your high rate loans first. If you have a credit card at 18% and a car loan at 10%, pay off the credit card first before paying down the car loan.

I don't get it, either. I don't think I've ever heard one of these "pop" financial advisors ever say anything that wasn't jaw-droppingly obvious, as if it they were letting you in on secrets of the rich and famous.

eastbay

[FastPlaySlow]

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3. Stop using premium gas. Regular unleaded works just as well, and btw, did you know that it is cheaper? Bam! I just saved you another $250 per year.

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Please don't use any fuel that isn't recommended. If your car can run on regular, run on regular. If it needs premium, please use premium. Don't use regular on a car that needs premium just because it's cheaper. It can damage your engine.

Premium vs. Regular

[Thremp]

FPS,

Thats pretty much almost only for old cars. New cars don't knock.

[Prelude008]

Thanks all for the advice/links. I agree with you on Suze. I watched her show for a second time and she somewhat annoying. It's something about her delivery...she over exaggerates and puts on a bit much to say the obvious. I do find lots of points and topics interesting...but it's something about her delivery.

I also think I will take your advice and start tracking where my money is spent to make the comparisions to see what I can cut out/back on.

[Prelude008]

Prohornblower,

Congrats on your 5 digit reduction in debt!!!!!! I have been listining to the recent online Dave Ramsey streams and I like him too.

Just curious, what your your biggest challenges in making your 180 turnaround?

Congrats again.

[gusmahler]

I am currently using the snowball method to get rid of debt.

http://en.wikipedia.org/wiki/Debt-snowball_method

It was tough at first to live below the way you used to live. But once the first credit card was paid off, I all of a sudden had a lot of extra money at the end of each month. And I've paid off two other cards in no time.

If you don't want to click the link: here's snowball in a nutshell.

Let's hypothetically say you have 5 credit cards each with a minimum payment of $100. You have $600 to spend on debt reduction. So you send $100/month to each of the cards except for one. You send $200/month to that one. After the first one is paid off, still spending the $1000/month on debt reduction, you can send $100/month to 3 credit cards and $300/month to the other card.

By the time you're on your last card, you're sending a lot of money to that card and getting rid of the debt.

The hardest part is reducing your spending. Previously, I'd send the minimum to all my cards, then I'd look in my bank account and see I have a bunch of money left over, so I'd buy stuff I didn't need.

Now, I just set up automatic payment. The same day I get the direct deposit from my employer, I send a set amount to the credit card companies. Now, I don't have extra money in the bank account, yet I'm still paying off debt.

[Thremp]

There multiple methods. I prefer the ones where you see progress quicker IE paying off smaller bills etc. Anyone who is able to recognize the value in paying off higher % debt probably isn't in debt :/

Snowball and others work very well for the debt plagued IMO.

[Big Bend]

I recently became 100% debt free.. its a GREAT feeling!

buy cheap, buy used, buy smart, buy less. good luck!

BB

[JuntMonkey]

I would always just pay the minimum to all of them, and then put all my leftover money to the one with the highest interest rate. Wouldn't matter how large or small the balances are.