re: Say you were to "give up" and go with debt consolidation?

We had more debt than any human being had the business of carrying AND more than enough money on hand to wipe it out but would not pull the trigger...made no sense UNTIL we got comfortable emotionally/mentally by assuring we had sufficient reserve if worse case played out...pay all debt and then lose sources of income (jobs).

Bit the big wiener and within three/four months debt was paid, roof didn't cave in and have breathed much easier since....and continue to add to savings.

BTW, our debt was north of 50k, closer to 70k

In addition to all the spending problems, I would try to pick up extra shifts each month. You will obviously bring in more money, but also won't be spending anything while at work.

Are you current with your payments? If so, try calling your credit card issuers and just ask for a rate reduction. They know their competitors are probably waving teaser offers under your nose. It costs absolutely nothing for you to ask.

You've already convinced yourself based on how you and your spouse are wired debt consolidation is the only thing that will work. Some strangers on a message board won't change your opinion is my opinion.

I often speak negatively of Dave Ramsey due to the fact he cost people money who don't live like the people that call in his shows.

You need to follow his message like gospel. You are already mentally financially bankrupt.

Good Luck

First of all, quit beating yourself up over this. You realize that it was dumb, but it happened and now you need to fix it.

I paid off about $17K in CC debt on my measly single income in less than a year because I finally got serious about it. I used to make the minimum payment and then put at least that much back on the card. It was a shell game with my money. I finally sat down and looked over my bank statements to see where my money was going. Holy Crap!!! Had no idea I was spending that much on going out to eat, stuff that I don't need, and going out to drink.

After that eyeopening I realized if I packed a lunch, stayed home and drank, cooked at home at night that I would have a ton of money leftover to pay off the cards. You have to find out areas that you are foolishly spending your money.

I also would transfer my cards to cards that had at least a year of 0% interest and then pay those off. It took about 10 months, but they got paid off and now I actually have a savings north of $3K and am contributing more into my Roth IRA as well. It feels great and never again will I get myself into that situation again. You can do it!

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also would transfer my cards to cards that had at least a year of 0% interest and then pay those off. It took about 10 month

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We had been doing this but stopped. Economy was better so we were getting turned down. Or there were very few cards with zero interest. Maybe things have changed now with the downturn and global economy?

Man, I am impressed. You are sacking up and you are going to deal with it.

I doubt you ever get in this position again. Ignore the "high and mighty" posters and stick yo your plan.

Working with a debt consolidation company, the kind that works on the credit cards, is definitely not as bad as bankruptcy, but it will impact your score for 2-4 years. That makes sense if you think about it logically; you agreed to pay a certain amount of interest and now you're having them renegotiate that rate for you. If you can refi the debt another way, that would be better. If not, just work a plan through them.

I know people that have done this and, without filing bankruptcy, their credit is in the mid-700s within 2 years.

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Are all debt consolidation companies scams?

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Clark Howard

I don't disagree with some of your points and as my old Dad used to say, you can't borrow yourself out of debt.

If he can consolidate all the unsecured debt and get a favorable interest rate, and cut up the credit cards, that is the way to go.

If not, the credit counseling deal may be his best option.

Bankruptcy should be his last and final option.

I applaud him for recognizing his mistake and paying back the money. He is acting in a responsible manner when many in this country don't own up to their mistakes.