Note: This is the application post from Hope wanting to be the next blogger for BAD. Feel free to ask any questions, leave your opinion and express your feelings in the comments
I’ve been asked to introduce myself before and that was hard, but introducing my debt as a first assignment is like asking me to appear at an interview in the most horrific outfit I own, unshowered and without doing my hair and make up. Talk about intimidating!
The worst of it is the shame, trying to keep up appearances that everything is fine when I’m really just drowning in debt. Deciding who to pay, how much to pay and when to pay is really stressful. Juggling the payment dates to try to avoid a late penalty, a ding on my credit score and still have enough money to cover groceries and gas for the month. You are probably getting the gist of my overwhelming dilemma.
For the last three years or so, I have been trying to pay off debt. I have had some successes, but also some major backslides. But I am truly and thoroughly sick and tired of being so stressed about my overwhelming debt and I’ve recently added some serious motivation to 1) getting out of debt and on solid financial ground and 2) setting a good example as a steward of my financial well-being.
With that being said, I must tell you a little about myself. I am an entrepreneur, who has successfully run a home based business for the past 8 years. I have a Masters degree and market myself as a high tech virtual assistant which typically translates into either business system consulting jobs or technical customer service and project management for small businesses. I love what I do.
I am also a single mom, who gets sporadic financial support for two of my kids from their dad and an adoption subsidy for my other two. My kids are my joy, my reason for everything I do and the reason that I work from home rather than going out and getting a fabulous corporate job with a six figure income (at least that’s how it would work out in my head.)
This past fall I was blessed to fulfill a lifelong dream of adoption and welcomed twin teenage boys into our home on a permanent basis (they had been placed here two years earlier as foster kids and since going home did not work out…) They are my new motivation. You see, my other two children are younger and I anticipated having at least another 6 years to get right financially before I had to think about cars and college, etc. But now, that run is very short, the twins started high school this year and could possibly drive next year (it’s a privilege, not a right, of course.)
So I’ve GOT to get a handle on this. I’ve got to get on solid financial ground. I’ve got to be a good example. And I’ve GOT to do it now.
So now you’ve heard of my greatest shame and my greatest joy. My income comes solely from my business and some support for my children. Now, a drumroll please, my debt consists of:
– a student loan incurred during grad school
– a car loan (I had to get a bigger car with the addition of children, purchased early last summer)
– three revolving credit lines
– a personal loan from my dad (no interest)
– a maxed credit card
– a tax bill (that was due in Dec, 2013)
– a consumer loan.
The total owed is $77,792.80. Ugh, just makes me sick. But I am ready for a fight. I am ready to tackle this and frankly I can use all the help, advice and nudges to stay on track that I can get.
Jeffrey strain is a freelance author, his work has appeared at The Street.com and seekingalpha.com. In addition to having authored thousands of articles, Jeffrey is a former resident of Japan, former owner of Savingadvice.com and a professional digital nomad.
I’m looking forward to all these applications. I do have a few questions that I think are important.
1. What is your take home pay?
2. What is one major sacrifice that you’ve made to help get the debt under control?
3. What is your current debt reduction plan?
Hi Danny,
To answer your questions…
1. My take home pay fluctuates but it’s pretty consistently $6K+ monthly
2. My first great sacrifice was selling my “dream” car. I had a Honda Element, completely paid off, but because it was a 4 seater, I had to get another car (this was two years ago.) At the beginning of getting serious, I sold it and put the entirety of the proceeds to debt. I still miss that car! Since then, we’ve given up home phone and tv service, not such a great sacrifice for us, but I know to others it would be like cutting off a limb to lose cable. And my on-going struggle, and sacrifice is travel, I am a road trip junkie, to the highest degree.
3. My current ‘plan’ and I use that term rather losely as I’ve been all over the place is to maintain a spreadsheet Dave Ramsey style of that shows the ‘snowball’ effect. It’s motivational to see how quickly, I could get out of debt with that view, but have really struggled with staying on course when things come up.
Thanks for asking!
~hope
Thank you for taking the time to reply. Quick follow up. What are your average monthly expenses at this point?
Danny,
Thanks for reading. If chosen for the blog, I promise to be a completely open book. At this point, I think I will hold the numbers back until the selection process is done. I hope you understand.
~hope
Hi Hope! A question: any mortgage debt? Also, what is your greatest weakness (i.e. why do you spend?)
Thanks!
Good question, Angie. And this is a tricky one for me to answer. Do I have a mortgage in my name? Short answer: No. Long answer, if I could I would.
My father helped me purchase a home 3 years after my marriage fell apart. It’s all in his name for a variety of reasons, and it’s where I live and plan to continue living. I pay him ‘rent’ but as soon as I can qualify, those payments will be part of my down payment towards the purchase of my home.
While we live in an expensive area, my home is very modest and newer so expensive maintenance and up keep is not yet (knock on wood) an issue for my budget.
Sorry, Angie…forgot about my weakness. There’s two things that just kill me…
1. My kids desires…camps, experiences. I’m very clear cut when it comes to stuff, but when it comes to experiences, I want to give it all to them.
2. Travel..if I could be on the road all the time I would. I love to road trip, willing to go anywhere. And can have fun doing anything. It’s been excruciating to me to have to stay still. Excruciating!
I applaud your courage lay your situation bare. Can you share what part of the country you are in? A state or region is fine. You mention you live in an expensive area. Does that mean that you consider it to be high cost for the country as a whole or just higher cost for your immediate area? Also, are you in a urban, suburban, or rural setting?
Also, what was the timeline of adoption vs. your divorce?
I’m just looking for more context of your environment and the sequence of some of the factors you mention contributing to your situation.
Thanks,
Dan
Hi Dan,
We live in a touristy area of Virginia. I say it’s high after comparing what houses, etc cost in both Texas and Georgia where most of my family lives. I would say my area is suburban, we’re about an hour from 2 major cities.
My marriage ended 6 years ago, a year after that we (my two little ones and I) became a foster family. Two years ago, the twins were placed with us as foster children with the goal of going home to their biological parents after some things were taken care of. Because they were not able to go home, they became eligible for adoption and it was a natural course for us, but was not the initial goal. Side note: they were the 5th and 6th foster placements with us over those years.
Does this answer your question?
~hope
Hi Hope,
1) How old are you?
2) How did you finance your adoption (I know you said you receive a subsidy now)? Were you a single parent at that time?
3) What do you do “to keep up appearances”?
4) How do you plan to juggle the additional responsibility of blogging? “?
Thanks!
Mysti,
I will be 4-0 this year, eeek!
The great thing about adopting through foster care is that it is absolutely free, rather the government picks up the tab for all court costs, etc. Because my kiddos were local there were no travel, etc. costs although some of them would have been covered as well if that was the case. Because they are considered a ‘special needs’ adoption, I was able to keep their monthly subsidy to help support them and they are able to maintain their healthcare. They will also be eligible for some college money.
Keeping up appearances is inbred in me, I know that sounds bad. I was always taught “avoid the appearance of ….” so being honest with my friends, although easier the more stressed I become has been hard. Saying no, we can’t go out to eat or to the movies. It’s probably more in my head than anywhere, but the pressure is enormous to not appear as struggling as I am. Make sense?
Juggling is what I do best…isn’t that the case with all moms 🙂
~hope
Hi Hope,
Kudos to your courage to “interview” here.
And kudos to adopting two kids into your family and making sure they have a home.
I am curious about what Dan and Mysti asked as well.
Some other things I would like to know:
1, How do you plan to invovle your kids in the debt-pay-off-process? Are they (currently) aware of your financial situation / debt-pay-off goals? Or are they also included in the goup of people you are keeping up a different appearance?
2, Why do you have the debt? (Or in other words, what made you max out those credit cards, what made you ask your dad for a loan what prevented you from paying off the student loan…)
All the best on your journey!
I hope to read from you here or elsewhere.
Hi Kili,
How to involve the kids…that is a million dollar question. First, I want to answer part two of that question…I do not keep up appearances with them, they know I am committed to paying off debt. Do they know the extent of the debt, no. Will I share that with them, probably not. I have recently started training myself to say to them…’we have other places we need to spend our money’ rather than ‘we don’t have money for that’ in hopes of teaching them, not that we are broke, but that every financial decision is a trade off.
How they will be involved? I am not sure. That’s something to consider. Not sure how much a 8, 9 and two 15 year olds can be involved other than learning to recognize how to say no and accept no…I’m sure that could be explored further.
Why I have the debt…one word, stupidity. I was so blessed to get out of my undergrad degree with no debt. Thanks to my family. But it was pretty quickly after that I started the debt cycle with credit cards at first, then the student loan, etc. Lack of self control, desire to have it now and having no one on to answer to all contributed to my current predicament.
~hope
Hope, I don’t know the needs of your 15 year old twins, but I do think once things are stabilized they would be great partners for the budget process. While they may not need to know the total figures, having a part in figuring out how to maximize the food budget, for example, might be excellent training. I have 3 girls, 15, 17 and 22. It’s been a great thing for my kids to know that we only have “X” dollars to spend on groceries. And they see it dwindle when we shop and start to realize there is a finite amount. While they don’t see my total budget they start to understand how much it costs to run a household. They need to see this because in just a few short years they will be running their own. Every situation is different but I know for my kids, the vague answers don’t cut it after a while. They do need specifics – just something to consider in the future for possibilities.
Julene,
You are absolutely right in that regards. All four of my kids have nights they must plan and make dinner on a weekly basis. In addition, the younger 3 (1 that is not mine but spends about 60 hours a week with us) do the weekly lunch shopping with a budget and my older two take turns having weeks where they manage the other grocery budget.
I recently wrote about an grocery store experience with one of them on my personal blog (not sure about posting that blog URL here,) but will happily expand on that down the road if chosen.
~hope
Wait, who is this 5th kid who spends 60 hours a week with you?
As I went back and re-read my reply, I realized there were some un-answered questions…
Why haven’t I paid off my student loans? The short answer, they were always the lowest priority. With the lowest rates and easy deferment with no penalty (other than financial) I kind of got in the habit of putting them off. Stupid, but honest.
The loan from my dad was unintentional and unintended. When I lost one of my long term, larger clients last fall, I decided that I didn’t need to replace them and would enjoy the freedom of losing that 40 hour a week phone commitment. Mentally this time was amazing! Financially this time was disastrous. Thus, the loan from my dad.
I learned two lessons from this…say No to some type of work. And when you lose some income, immediately put feelers our for new work, even if you aren’t going to take it immediately.
~hope
Wow Hope – you do have courage and on the surface at least it would appear that you are ready to get your debt paid off. The main thing I would be concerned with is that fact that you are a single mom and are the one “to do it all” for your finances, kids, blog, etc. Readers of this blog can be tough at times and I worry that with no one to bounce ideas, questions, responsibilities and the like off of from time to time that you would become overwhelmed. Don’t get me wrong, I WANT to see you succeed and the readers can also be your biggest cheerleader but I think as other’s have found out in the past, living in a glass bowl can be very tough. Are you ready to take on that challenge too, just as much as the other challenges you have in your everyday life?
Julene,
I think I need this more than anything else. Since I am so good at keeping up appearances, and I am a single mom, there is really no one there slapping my hand when I make a stupid decision. I NEED that.
Tough skin is hard to come by, especially when you are so stressed, but the I think when the outcome is so much greater than the fight it is worth it and I am in such a place that I think I would literally walk through fire to get a handle on my financials and become a better model for my kids, a better provider for my kids and hopefully someday in the position to help or at least guide them as they get to the age of independence.
Thanks for asking.
~hope
Very good point Hope. Good luck!
You seem like a great blogger! My questions are: What does your idea of buckling down look like and assuming an average take home of 6k a month (net, it appears?), what’s not accounted for? I don’t know that it’s appropriate to ask how much your fixed costs and minimum payments amount to unless you’re selected, but it would be helpful to know that you aren’t living paycheck to paycheck and that you can get ahead of the debt at more than 1% a month. Thanks!
Hi Meghan,
Good point. I have a pretty tight budget, but when reviewing it with this question, there are probably still a few areas I could tighten even further. Some of the decisions are really tough especially when it comes down to my kids’ stuff, but I am wholly committed to going all in. I know it won’t be easy, but I think with guidance, encouragement and probably a few slaps on the hand, the pain of the next years could be rewarded with unimaginable freedom for me and my kids. If I can keep that in mind…
I am not afraid to ‘bare all’ I welcome the constructive criticism. And I do believe I make enough to pay off the debt in a reasonable amount of time as long as I can stick to it…
I hope this answers your questions…as least kind of.
~hope
Hi Hope.
When you say a reasonable amount of time, that’s still a bit vague. I understand you may not want to give specific numbers yet, but do you have an approximate time frame for your debt payoff? I know setbacks and curve balls are to be expected, but how long do you anticipate your debt journey taking?
I vote for Hope.
She seems to be in a similar situation as me and I’d love to share her journey to becoming debt free. For once, I’d love to read about someone who still has weaknesses but still trying overcome setbacks, etc.
Hi Hope!
Congrats on your willingness to put yourself out there and tackle the hard questions to come.
My only questions are simple; are you willing to blog regularly and with a solid purpose of providing accountability to what you are spending and your debt reduction, are you serious about getting out of debt and helping others do the same by giving encouragement, setting goals and not making excuses when you are side tracked.
Thanks for sharing.
Connie
I think Hope sounds like a great contributor. While I don’t have kids, I do have weaknesses and had a similar experience of being irresponsible with my money in my 20s and hefty student loan debt.
Hope you sound very willing to tackle this head on. I think having a perspective of someone involving kids in their debt pay off journey would be really nice balance to those involving spouses or partners. I’m really looking forward to having multiple bloggers and different perspectives, particularly individuals who don’t make loads of money and have a tight budget. Sometimes I have felt that previous bloggers have had a lot of extra income to throw at debt and that is hard to relate to sometimes when you are not in that situation. Love this blog!! 🙂
I’ve read every application (which I hope are nearing the end) and I come back to Hope as my vote for the next blogger. Good luck!
I would like to see more of hopes story! I can relate to her because I’m a broke single mom! Lol. Good luck!