Have You Ever Considered Bankruptcy?

Please take the poll below and let me know what your experience has been.

 

March Goals

Our goal for March is to pay over $3,000 toward our debt. Of course, there is interest ($420) , so it won’t be a net reduction of $3,000, but every bit counts. 

So our totals at the end of March should be:

Credit Card Debt  ::  $47,682.03
Taxes Owed           ::   $   5,447.78
Personal Loans    ::   $   5,450.00

Total Debt*            ::  $58,579.81

*does not include school loans

:: HOW ::

One of the reasons that we have found it hard to talk to people about our financial situation is because of the “how” – sometimes it’s really painful to accept that you are the reason that your life is hard and that you have made foolish decisions. Although, I think it is harder to change poor habits than it is to just accept responsibility, but you can’t change until you accept the reality.

The reality is that we did this to ourselves. 

That’s tough and it sucks, but it’s time to put on our big kid pants and accept that it was our lack of discipline that brought us to this point. 

Admittedly, there were some things that happened to us that made it all even more difficult (cancer, job loss, etc.), but we would have been able to deal with those so much more easily if we hadn’t already been in such bad shape. So what mis-steps can we identify?

  1. Living beyond our means :: we moved away from our parents in the first year of marriage and out of a sense of guilt, we managed to travel “back home” almost every two months for two years. This is after moving to West Los Angeles – a very expensive place to live – and we started to rack up a ton of debt, all the while excusing it because we felt it was “worth it” to see our families. 
  2. No accountability :: we didn’t set up any type of monitoring system, either internal or external, to hold us accountable for the debt we were amassing.  Whenever I confronted my husband about using a credit card for food, we’d get into a fight about the fact that we were too busy to cook and that we didn’t have the cash flow. And my husband is a wonderful, sweet guy who wants me to have whatever I want, so he wasn’t about to tell me no and my spending went un-checked.
  3. Lack of a budget :: we didn’t have firm financial goals and I would set up un-realistic budgets that we couldn’t meet. I’d feel overwhelmed with work, school, community service and didn’t find a good way to ask for help from those who better at taking a realistic look at life. The irony is that I created and maintained budgets for several non-profits, and they were never a problem – I just couldn’t get it together for my own family.

I know there are more, but this is enough for now. Soon, I’ll write about how we’re starting to address these particular issues and get ourselves on a better path.

:: WHAT & WHY ::

I’m starting this blog in an effort to transparently and honestly communicate the journey that my husband and I are in the midst of with our debt and finances. As the bottom started to fall out from underneath us last year (2008), I was able to find some on-line resources that gave us pointers and encouragement, and I thought that maybe we could pay that help forward by sharing our process.

So what do I hope that will look like? My goal is:

  • to relay our history
  • to evaluate our good and bad decisions
  • to post a minimum of 3 times a week
  • to track our success with out debt reduction plan
  • to identify resources for budget planning and debt reduction
  • to learn from those who visit the blog
  • to discuss the option of bankruptcy and what alternatives are available. 
  • to have our commercial/credit card debt paid off by July 2012

Why would I do such a thing? I know that people in my ethnic and social demographic seldom have honest conversations about money and what we do with it. I don’t know how much my friends make and they don’t know how much I make. And part of our problem as things started to go awry is that we have had such a hard time communicating how bad things have gotten – we don’t want to be the downers at the party, or the friends that can never afford to go out.  How much easier would it be to walk along side our friends and family in life if we knew where people were really at in their struggles? 

So here we are. It’s a first step. 

Let me know if there are any topics about which you would like me to focus on/share. Thanks for stopping by…