Debt Dumpers - 2017

[MerissaAndMomLoveDis]

I'm taking a deep breath and taking the plunge to join this thread. I've been reading the Debt Dumpers thread since late last year and I've really learned a lot. I thank all of you for here for sharing and encouraging. I had no debt at all until the economy went belly up in the late 2000's. I kept trying to keep my small business afloat despite suddenly having about 2/3 less income, while at the same time not cutting back on private school for the kid or her very expensive sport or travel (Disney trips especially). Fortunately, all bills got paid during this time and I was never late, but it was a lot of stress. I finally moved on in 2012 to a great job and cut out private school, but by that time, wow, the credit card debt had really accumulated, along with some IRS debt for those lean years. In late 2015 I finished paying off the IRS!!! But it seems like I was not really making huge strides at paying down the credit cards. I got an 8% raise this year and made budget cuts, and I am finally making some progress. In the past three months, I paid off my second mortgage, paid off my car, and paid off the smallest credit card today. Now I finally feel like I can come out of lurkdom. Still a LONG way to go, and it seems like every time I get going well, something expensive happens ( like a pipe burst in my foundation to the tune of $2500.00--ugh!) but I get a lot of inspiration from this thread. A big thanks to you all!!

 

[AmyAnne]

Oops wrong thread . . . sorry!

 

[Dentam]

I'm taking a deep breath and taking the plunge to join this thread. I've been reading the Debt Dumpers thread since late last year and I've really learned a lot. I thank all of you for here for sharing and encouraging. I had no debt at all until the economy went belly up in the late 2000's. I kept trying to keep my small business afloat despite suddenly having about 2/3 less income, while at the same time not cutting back on private school for the kid or her very expensive sport or travel (Disney trips especially). Fortunately, all bills got paid during this time and I was never late, but it was a lot of stress. I finally moved on in 2012 to a great job and cut out private school, but by that time, wow, the credit card debt had really accumulated, along with some IRS debt for those lean years. In late 2015 I finished paying off the IRS!!! But it seems like I was not really making huge strides at paying down the credit cards. I got an 8% raise this year and made budget cuts, and I am finally making some progress. In the past three months, I paid off my second mortgage, paid off my car, and paid off the smallest credit card today. Now I finally feel like I can come out of lurkdom. Still a LONG way to go, and it seems like every time I get going well, something expensive happens ( like a pipe burst in my foundation to the tune of $2500.00--ugh!) but I get a lot of inspiration from this thread. A big thanks to you all!!

This is a great group to be a part of! My cc debt started around the same time as you - got a job offer I couldn't pass up in another state a couple of years after buying a house. Of course I bought at the peak of the market right before it crashed... and my new job is in a very popular city with expensive housing. So... I've been chugging along but not making the great strides I'd like to. But never give up! This group is great for encouragement and commiserating alike!

 

[ruadisneyfan2]

While I enjoyed the birthing class I took, keep in mind that very often things do not go according to plan. I felt like the people who taught ours were so reassuring that everything would go according to your birth plan and standard birthing steps (here are the steps of labor, water breaks at the end--well my water broke and I never had a pain!) that it actually made it more traumatic for us when things did not go as expected and I ended up with an emergency c-section. So good to have a plan, good to have knowledge, but just be aware that your doctors know what they're doing and don't freak out if that plan doesn't get used!

We have a chunk of money incoming that I'm debating what to do with it. I can either use it to:

1. Pay down the car loan so that we could probably entirely pay it off by next June and get $400/month back.
2. Pay OFF the second mortgage so that we'd get $200/month back.
3. Pay down the credit card.

I think #1 is the best use of it because the car payment is $400/month and around next October my student loans will come due (though they will probably be deferred again for a bit I don't want to count on that!) and that's going to be at LEAST $600/month, possibly more, so I'd like to get rid of our highest monthly payment to offset that. #2 would be nice, but that's a really low interest rate and while getting $200/month back that we could apply to another payment would be a good thing, if we were ever crunched for money that would be the easiest payment to make. #3 is SUPER TEMPTING because we have the credit card run up WAY too much, but my fear is we put a huge chunk down on it, pay it down...then run it back up again. I feel like whenever we make a major dent in the credit card, something happens and we need to put another couple thousand on there again and before you know it the monthly payment is ridiculous.

But I talk myself out of this plan every other hour! I think paying down the car is the smartest thing. Money from my second job through December (hopefully I get as much as I think I will) can go towards paying down the credit card so that we have enough space on there for emergencies, then from Jan-June my second job should pay off the car loan completely. After that, I'm thinking the second job money goes towards paying down/off the second mortgage, then when that's gone, all the "extra" money we're saving on having those loans gone AND the money from the second job goes towards my student loans.

This all sounds so good on paper but it never ever works out as well in real life, unfortunately!

I agree with PPs to pay the car down and free up the $400/month. I would also take some of that chunk to create a$1000 emergency fund. This is Step 1 of the Dave Ramsey method. Some like his ideas, some don't but his Snowball approach worked so well for us.
Some people believe $1000 is not enough to cover all emergencies but it sure covers a lot and many times has kept us from leaning on a cc when unexpected expenses occur.

 

[DisneyMandC]

Curious if any of you have any trips on travel hacking/credit card hacking to share--or at least a good beginner's website you know of. DH and I are considering getting the Chase Marriott Rewards card that offers 80k points and a free night every year. We pay off our credit cards in full every month and have good credit scores, so we would like to take advantage of some good cash back or travel deals.

 

[Jen and Ashwin]

Curious if any of you have any trips on travel hacking/credit card hacking to share--or at least a good beginner's website you know of. DH and I are considering getting the Chase Marriott Rewards card that offers 80k points and a free night every year. We pay off our credit cards in full every month and have good credit scores, so we would like to take advantage of some good cash back or travel deals.

I just finished my spend on the Marriott card. When I signed up it had the 100k bonus and I was able to use almost all work expenses to hit the 5k spend. DH and I have been working through some of the Chase cards, since we want to maximize UR points for our future trips. I have Chase Sapphire Reserve and Chase Freedom Unlimited. DH has Chase Freedom and will probably be getting the Chase Sapphire Preferred soon. I also just got the IHG card with 100k bonus and free annual night for $49 annual fee. Working on that spend now. I figure that this card will help us a lot when driving places, since we really like Holiday Inn Express for overnights on the road.

I would check out the "I love credit cards" thread in the Budget boards. Unlike a lot of other forums (Flyertalk and Reddit), people here on DIS are really nice and helpful. No drama. There are lots of blogs too. I don't really follow blogs much, but glance at The Points Guy every now and then to see what is up. I also watch the finance section of Slickdeals because people post the latest credit card bonus deals there. Doctor of Credit was a good site to look through when I was first starting and trying to get some basic information about Chase cards. I have seen other blogs mentioned on DIS such as MommyPoints and MillionMiler, but don't follow those.

 

[DisneyMandC]

I just finished my spend on the Marriott card. When I signed up it had the 100k bonus and I was able to use almost all work expenses to hit the 5k spend. DH and I have been working through some of the Chase cards, since we want to maximize UR points for our future trips. I have Chase Sapphire Reserve and Chase Freedom Unlimited. DH has Chase Freedom and will probably be getting the Chase Sapphire Preferred soon. I also just got the IHG card with 100k bonus and free annual night for $49 annual fee. Working on that spend now. I figure that this card will help us a lot when driving places, since we really like Holiday Inn Express for overnights on the road.

I would check out the "I love credit cards" thread in the Budget boards. Unlike a lot of other forums (Flyertalk and Reddit), people here on DIS are really nice and helpful. No drama. There are lots of blogs too. I don't really follow blogs much, but glance at The Points Guy every now and then to see what is up. I also watch the finance section of Slickdeals because people post the latest credit card bonus deals there. Doctor of Credit was a good site to look through when I was first starting and trying to get some basic information about Chase cards. I have seen other blogs mentioned on DIS such as MommyPoints and MillionMiler, but don't follow those.

Thanks for the tips! Yes, I tried to look through the I Love Credit Cards thread some. It's gotten so long! I feel like I need an introductory course to reading it! My mom just got a Chase Freedom card since I think they were running a $200 sign on bonus, so we're considering that too. Do you happen to know when you got your Marriott card/when they offer the 100k bonus? We have no pressing need for the points right now since our week long hotel stay in October is already covered by points, so I don't mind waiting longer if that 100k bonus happens to appear at a certain time.

 

[Jen and Ashwin]

Thanks for the tips! Yes, I tried to look through the I Love Credit Cards thread some. It's gotten so long! I feel like I need an introductory course to reading it! My mom just got a Chase Freedom card since I think they were running a $200 sign on bonus, so we're considering that too. Do you happen to know when you got your Marriott card/when they offer the 100k bonus? We have no pressing need for the points right now since our week long hotel stay in October is already covered by points, so I don't mind waiting longer if that 100k bonus happens to appear at a certain time.

I got my Marriott card in April. From what I understand, this is the first time they have ever offered the 100k points bonus. There is no way to tell if it will be offered again and if so, when. Marriott will be merging their rewards program with SPG, so it isn't clear if this will bring changes to their credit card offering some time next year or not.

One thing to consider when you start getting into the credit card game is if it is worth adding your spouse as an authorized user on a card, especially if you are interested in getting some Chase cards to start. Chase has something called the 5/24 rule. Basically, if you have opened more than 5 credit cards within the last 24 months, then Chase will deny you for most of their credit cards (some co-branded cards are excluded from the rule). The kicker is that authorized user accounts count towards the 5/24 limit. For this reason, DH and I don't add each other as AUs.

 

[DisneyMandC]

One thing to consider when you start getting into the credit card game is if it is worth adding your spouse as an authorized user on a card, especially if you are interested in getting some Chase cards to start. Chase has something called the 5/24 rule. Basically, if you have opened more than 5 credit cards within the last 24 months, then Chase will deny you for most of their credit cards (some co-branded cards are excluded from the rule). The kicker is that authorized user accounts count towards the 5/24 limit. For this reason, DH and I don't add each other as AUs.

Good to know. I don't think we've opened 5 credit cards over the last two years, but I do know we've opened at least two between Lowe's and Amazon. I was considering having DH add me as an AU on the Marriott card because it gives you an extra 7500 points. I'll have to look into things and see what our best options are.

 

[Alexle2007]

Good to know. I don't think we've opened 5 credit cards over the last two years, but I do know we've opened at least two between Lowe's and Amazon. I was considering having DH add me as an AU on the Marriott card because it gives you an extra 7500 points. I'll have to look into things and see what our best options are.

You could add one of your children as the AU for the extra points. That is what I plan to do. Add DS as AU to CSP for the extra bonus points.

 

[DisneyMandC]

You could add one of your children as the AU for the extra points. That is what I plan to do. Add DS as AU to CSP for the extra bonus points.

No kids unless they'll let me add the golden retriever or the cat

 

[Jen and Ashwin]

Good to know. I don't think we've opened 5 credit cards over the last two years, but I do know we've opened at least two between Lowe's and Amazon. I was considering having DH add me as an AU on the Marriott card because it gives you an extra 7500 points. I'll have to look into things and see what our best options are.

To get the extra points, you can add any name as an authorized user. I added my bird as an AU and made a single purchase with the card to get the extra 7500 points. My bird now has two credit cards in his name because I also added him to the IHG card for an extra 5k points.

 

[DisneyMandC]

No kids unless they'll let me add the golden retriever or the cat

To get the extra points, you can add any name as an authorized user. I added my bird as an AU and made a single purchase with the card to get the extra 7500 points. My bird now has two credit cards in his name because I also added him to the IHG card for an extra 5k points.

LOL ok, I retract my earlier statement! Good thing Russell (dog) and Kevin (cat) have good credit scores!

 

[Jen and Ashwin]

LOL ok, I retract my earlier statement! Good thing Russell (dog) and Kevin (cat) have good credit scores!

Good thing your cat's name isn't something like Fluffy. My bird is Hector, so no weird flags raised.

 

[DisneyMandC]

Good thing your cat's name isn't something like Fluffy. My bird is Hector, so no weird flags raised.

Yes, because I'm the only weirdo out there who named their girl cat Kevin. Can you all tell I'm a fan of Up?

 

[pblack]

I have two credit cards that we use on a regular basis. One is the Costco Visa card which we use for pretty much everything (4% on gas, 3% on travel and dining, 2% at costco, 1% everything else) and then the Chase Freedom card. I really only use the chase card when they have decent 5% cash back categories. This quarter it's restaurants and movie theaters, so it's been getting a lot of use in the restaurant category. The costco cash back obviously comes as a costco check, but i've heard that you can go in and request it as cash instead of spending it at costco. We spend a decent amount at costco, so i don't mind spending it there. The chase freedom cash back you can get deposited to your account (if you have chase), get it as a statement credit, or use it on their rewards site. With the cash back we have so far, i've been saving it to use for our Disney trip either next month or in October.

 

[AmyAnne]

Regarding credit cards and travel rewards, definitely look at the Chase Sapphire Reserve. The $450 annual fee gets you around $750 in points that can be used for travel, with the 50,000 points sign-up bonus. There's also a $300 travel credit every year, plus lots of other travel-related perks. If you have any specific questions, as Jen said, there's lots of very knowledgeable and very helpful people on the credit cards thread.

 

[dina444444]

I have two credit cards that we use on a regular basis. One is the Costco Visa card which we use for pretty much everything (4% on gas, 3% on travel and dining, 2% at costco, 1% everything else) and then the Chase Freedom card. I really only use the chase card when they have decent 5% cash back categories. This quarter it's restaurants and movie theaters, so it's been getting a lot of use in the restaurant category. The costco cash back obviously comes as a costco check, but i've heard that you can go in and request it as cash instead of spending it at costco. We spend a decent amount at costco, so i don't mind spending it there. The chase freedom cash back you can get deposited to your account (if you have chase), get it as a statement credit, or use it on their rewards site. With the cash back we have so far, i've been saving it to use for our Disney trip either next month or in October.

You can cash the check out for actual cash at costco. That's what I did with mine last year.

 

[ruadisneyfan2]

Darn, when we got our cat we planned to name her Zoe. Ds20, then 9, wanted to name her Flower (as in Bambi). We didn't really care so Flower it is.
I never would have considered back then that such a name could ruin her potential for a good FICO score.
I did add dh to my CSP and added ds20 to dh's CSP so that was nice to get points for that.
I wonder if the bonus point offer is for a limited time.

 

[Jen and Ashwin]

Darn, when we got our cat we planned to name her Zoe. Ds20, then 9, wanted to name her Flower (as in Bambi). We didn't really care so Flower it is.
I never would have considered back then that such a name could ruin her potential for a good FICO score.
I did add dh to my CSP and added ds20 to dh's CSP so that was nice to get points for that.
I wonder if the bonus point offer is for a limited time.

Generally, you need to use the AU card within the first 3 months in order to get the bonus. Offering bonus points for adding an AU is pretty common for lots of cards, so I imagine that offer will continue.