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The Finances and Debt Thread

Do Not Sell My Personal Information
Update: down to 13k in cc debt. 3.5k of it is gaining 5% interest down from 24.24%, 4.5k is gaining 2% interest down from 20.24%, 2.5k is gaining 6.9% interest, and the rest is on two cards that are paid off each month. I'm down 5k from last June, and this is with a 3k car repair in January. I've had to refinance a lot, defer student loans, change insurances, etc. To get where I am. I also paid off my wife's immigration lawyer, which helped. I also started saving for retirement in March.

I'm looking to refinance my car loan and private student loans now so I can save even more. I'm also looming to find that magical unicorn <$1,000/mo. 2 bed 1 bath apartment in Seattle area, which I think I found. That would save me another 400 a month. I have 2k worth of sound equipment I'm selling on eBay as well.

Once I get out of credit card debt, I will buy a house.
 
I have a few things that are really going to help my wife and me get out of debt a lot more quickly. It's long, but I'm excited about it so fuck you. :D Ok, scroll to the bottom for the tl;dr version if you must.

My wife and I started out in the red when we got married, barely survived, finally got to break even, and now we're in the green, but not by much, so watching debt barely move despite having a fairly bare-bones budget is frustrating.

The first of which was a fairly big (to us) raise for her. A $3,500 raise because her work finally offered her 40 hours a week instead of 36.5 even though the person whose job she took over worked 40 hours.

Next is I was finally able to get my car refinanced at a 2.1% lower interest rate on top of paying $114 less a month on minimum payments. That's a big asset because not only do I save money in interest, but I get more cash flow to pay off more important things like credit card debt. I couldn't get the car refinanced for the longest time because my credit card debt to limit ratio was too high, and my car had negative equity (still does, but not insanely negative enough to get no offers).

The last thing that is going to save me a bunch of money is the fact that I'm moving! My apartment complex wanted to jump my rent from $1,264 a month to $1,399 a month. I was able to negotiate that down to $1,335 a month, but, between the jump and insane charges for water, sewer, garbage, community area maintenance fees (~$130-135 a month for all those), my wife and I decided it was time to move. We started searching in June, but we didn't find any place that was a significant enough drop down in rent price to make it worth moving due to moving costs unless it was either a significantly smaller apartment or in a much worse neighborhood (we find drug needles right outside of our apartment door all the time as it is).

We also felt like we were discriminated against multiple times because we have a German Shepherd as an emotional support animal. Places that had "no pets" rules or breed restrictions have to lift those rules for us since we legally have an emotional support animal, but we felt like places we were clearly qualified for were choosing to not select us because of our dog. One property manager we were working with had a 2 bed, 1 bath in a neighborhood for $985 (low, flat W/S/G fees), and he kinda reminded me of Saul from Breaking Bad. Just a sleezy, nervous-sounding dude. He gave us the run-around and tried to say that our dog had to perform a duty in order to be a service animal. I told him that he's an emotional support animal and retains the same rights as a service animal when it comes to renting and owning according to the Fair Housing Act (public places are a different story). He said no one he talked to agreed with me. My wife and I felt like he would have rejected us for financial reasons or said that someone applied before us, so we just let him go. I hope someone files a discrimination case against him. Anyhow.

We had until July 11th to let our apartment complex know if we were going to move. We fount one place we liked a lot for $1,295 a month, W/S/G included, but, after doing a cost analysis, the moving costs on top of the increased commute length expenses made it so it would take about 5-6 months before we'd break even. So July 11th passed, but I didn't give up. I kept on searching, and I found a place close to that same place we liked for $1,025 a month, W/S/G included! For the greater Seattle area for a 2 bed, 1 bath apartment is a steal. And it's 1,200 sq ft, which is massive. Bigger than any 2 bed, 1 bath apartment I've ever heard of actually. Vaulted ceilings and sky light windows.

By the time we saw the posting online, it had only been posted for a few hours. I called the lady whose number was listed on the posting, and we told her we wouldn't be able to see the place for over a week due to us going on vacation to see family. She said to apply online sight unseen because it will be gone by then and that they refund app fees to anyone who doesn't get the apartment anyway, so it's risk free. While waiting between flights to our destination, I applied on my phone (not a fun process, btw). Days later, we were notified that we were the first people to have applied, and it's first come, first serve. We got approved, and I immediately began searching for someone to take over our apartment.

My complex would only let me out of my new lease renewal at this point if I did a lease transfer because they legally had me bound to a new lease because I missed the 20-day notice. Now I had the option to do a month-to-month, but rent for that month (August) with W/S/G would have been around $1,600, and the new place wanted me to take over the new place no later than August 1st, so I would have been paying for two places. That would have put me in basically the same scenario as the first place we decided not to go with because it would have taken half a year to break even. So it was a must that we found someone to take our place by the end of July.

I put up a Craigslist ad, and I had exactly one person apply for my apartment. We didn't get her approved until this past Wednesday, July 26th. Get this: due to the fact that my wife are moving on Sunday, July 30th, because that is the only day we could get lots of help and not have to burn a vacation day to move, this new tenant it taking over our lease for ONE day (July 31st) before signing her own new lease. I'm forfeiting our deposit here to her because she is taking the deposit "as is," but it was only $300, and I'm pretty sure we would have had to pay most of that to cleaning fees anyway. I asked the new tenant to pay me one days' worth of rent because she was moving in for one day before her new lease was up, and she did.

All in all, the moving costs are about $400 (app fees, moving costs, paying one day rent at two places, admin fees, etc.), maybe a shade under, but our new place is saving us $440 a month between rent and utilities. Granted my commute is now a little longer, we should be able to recoup that money within about 30 days or so (not including the refundable security deposit, none of which will go towards cleaning fees).

I'm also working towards my own promotion hopefully before the end of the year or early next year. That should be a $10-15k raise. With these new events, my wife and I could be out of credit card debt by the Summer or Fall of next year, and a raise could push that into late Spring or early Summer of next year. We would still have my school loans as well as two car loans, but at least those wouldn't be killing our credit score and at high interest rates to boot.

TL;DR: My wife got a raise, I finally was able to refinance my car loan for lower interest and lower payments, and we are moving, all of which increased our cash flow by $847.58 a month, which should get us out of credit card debt by next summer or fall.
 
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Finances are much better. I'm down to about $9k in credit card debt, and I only owe 5% interest per year on about $1,000 of it. The other $8k is either on a card that is paid off monthly or on a promotional transfer, so it is gaining 0% interest. My wife got a promotion (not including the increased hours she got), so she's making even more than my last post, and, since my last post, I have completed my training for a promotion. Someone just lost their job nearby in my district, so I should be getting that position since I have clearly performed the best out of all my peers both objectively and according to my superiors. Should be a $10-20k increase in pay (especially since it's in Seattle, which just got a $15 minimum wage).
 
So just a little update...the mint app is awesome can see all of my finances including my investments I have through work. After this next payment coming up I'll have paid off $2k of my debt while still saving some money. No clue what the fuck I was doing before, being an idiot I suppose.

Thanks again for all the advice I got from everyone. Once I get shit paid off I'm thinking I'm going to talk to a financial advisor and start investing into more things. I'm sure I'll be back in here for more questions.
I am credit card debt free. Such a relief
 
I am credit card debt free. Such a relief

Congrats! Stay thst way!

Another victory recently: my credit score is about 710 right now. It hasn't been that high in 3 years! I calculated it will be in the mid to high 700s once I get rid of all of my credit card debt. My credit score was about 630 back in april.

I also built a 401k of over $3,000 starting from April of 2017. It's not much, but I'm proud I started saving this year. Thank God for bull markets!
 
Wanted to grave dig this thread in case anyone had any recommendations about life insurance.

My parents are transferring over the whole life insurance plan they had on me and I can do whatever I want with it.

The policy is for $30,000 and the monthly premium is $22.00 a month. It has a net cash value of about $3,200 so I believe I can sell the policy to get that.

Now I have life insurance through my work (worth a little north of $200,000). I know if I lose my job I won't have that insurance anymore so I still want to have something to at least cover my mortgage if I lose my job and kick the bucket.

So my question is should I sell this policy and pocket the cash, and get another policy outside of my work? If so what kind?

Or should I keep paying on it?
 
Wanted to grave dig this thread in case anyone had any recommendations about life insurance.

My parents are transferring over the whole life insurance plan they had on me and I can do whatever I want with it.

The policy is for $30,000 and the monthly premium is $22.00 a month. It has a net cash value of about $3,200 so I believe I can sell the policy to get that.

Now I have life insurance through my work (worth a little north of $200,000). I know if I lose my job I won't have that insurance anymore so I still want to have something to at least cover my mortgage if I lose my job and kick the bucket.

So my question is should I sell this policy and pocket the cash, and get another policy outside of my work? If so what kind?

Or should I keep paying on it?
Sell the policy, pocket the cash, and buy a term life policy. Depending on your age and health, for $22 a month you can get hundreds of thousands of dollars in coverage instead of just 30K.
 
I have a bunch of cash in the bank that I don't know what to do with.

I have superb credit, I pay extra on my mortgage (about one extra payment a year), I contribute about 10k to my 401k each year in addition to employer contributions. I'm 29 and intend on buying a new house within the next few years as well as having a kid. Debt free except the mortgage.

Since I will need the cash relatively soon (within next few years), does it make sense to just sit on my money?

I'm thinking of at least switching to Discover online banking to get the 1.4% interest. I have a Discover credit card. Seems like a no-brainer. Anyone have experience with online banking/Discover in particular?

My goal is to max out my annual 401k within next few years (typically when I get a raise I tack on another 1-2% to the 401k, also going to start dumping some of my bonus into 401k), then open an IRA work towards maxing that out. Seems pretty par for the course.
 
Sell the policy, pocket the cash, and buy a term life policy. Depending on your age and health, for $22 a month you can get hundreds of thousands of dollars in coverage instead of just 30K.

I'm 25 but overweight which is something I need to work on, but other than that I'm fine health wise so I will go with what you suggested.

Thank you!
 
I have a bunch of cash in the bank that I don't know what to do with.

I have superb credit, I pay extra on my mortgage (about one extra payment a year), I contribute about 10k to my 401k each year in addition to employer contributions. I'm 29 and intend on buying a new house within the next few years as well as having a kid. Debt free except the mortgage.

Since I will need the cash relatively soon (within next few years), does it make sense to just sit on my money?

I'm thinking of at least switching to Discover online banking to get the 1.4% interest. I have a Discover credit card. Seems like a no-brainer. Anyone have experience with online banking/Discover in particular?

My goal is to max out my annual 401k within next few years (typically when I get a raise I tack on another 1-2% to the 401k, also going to start dumping some of my bonus into 401k), then open an IRA work towards maxing that out. Seems pretty par for the course.

Do you max your IRA?
For now, you have options. If you are not maxing your IRA that should be priority #1 even above your 401k (after you hit your company match). Otherwise, you can either put it in a high interest savings account like discover or ally, or finish maxing your 401k if you want tax savings. I'd honestly have to know more details about how much you make/your tax bracket/other tax deductions to understand if that is your best option (hint, it is definitely worth it in terms of tax savings/$$, but it might not be worth it in your instance due to wanting to save for a house).
 
Quick question. Now that I'm almost debt free I'll be opening up a Roth IRA. I should be focusing on maxing that out before my 401k correct? Obviously do the companies match
 
I've got an extra $8K lying around in a refund check that I'll need to use for school in the summer.

Thoughts on the best use of it for the next few months until June?

I can open up a new savings account and recoup a $150 bonus immediately. Maybe some sort of money market or mutual fund account?
 
Quick question. Now that I'm almost debt free I'll be opening up a Roth IRA. I should be focusing on maxing that out before my 401k correct? Obviously do the companies match
While there are a few exceptions depending on your personal financial situation, the general rule of thumb for probably 99.9% of people is:

1. First, fully fund your 401(k) up to the point where your employer stops matching.
2. Next, max out a Roth IRA.
3. Next, max out your 401(k).
4. Finally, fund a traditional brokerage account.
 
I've got an extra $8K lying around in a refund check that I'll need to use for school in the summer.

Thoughts on the best use of it for the next few months until June?

I can open up a new savings account and recoup a $150 bonus immediately. Maybe some sort of money market or mutual fund account?
I would find out how long the bank expects you retain a minimum balance and what that balance is. Most of those up front bonus deals require you to keep a balance of $10K for at least 12 months. Makes no sense to do that if you're just going to forfeit the bonus once you withdraw for your classes. 6-month yield on a money market account is going to be shit.
 
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Do you max your IRA?
For now, you have options. If you are not maxing your IRA that should be priority #1 even above your 401k (after you hit your company match). Otherwise, you can either put it in a high interest savings account like discover or ally, or finish maxing your 401k if you want tax savings. I'd honestly have to know more details about how much you make/your tax bracket/other tax deductions to understand if that is your best option (hint, it is definitely worth it in terms of tax savings/$$, but it might not be worth it in your instance due to wanting to save for a house).
Most 401(k) plans allow the investor to withdraw from the account for the purposes of a primary mortgage down payment.
 

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