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Credit Card Debt is an Understatement. – BEH

I have over 42k in credit card debt. And also have about 40k in debt to my 401K. I am a mess. I am a professional and make enough money to keep all of these bills paid, but just seem to continue going further in debt. I closed one card since they wanted to raise the rate on me, so I can no longer use it and have curtailed my spending on the other so have only put about 500.00 on it in the last 6 months. I am in a mess to say the least but do not wan to file bankruptcy. I cannot borrow anymore from my 401 K either.

Can you tell me the best way to try and get rid of this debt. I am not looking for a free bailout, I knoew tha tis scam, but realisticly need a plan to do something about this mess I am in. I do not own a home, recently went through a divorce and got nothing form it but more debt. I am not late on any payments but barely get by each month. I am about 5 years away fron retirement, hopefully, but with this much debt, that may never be true. Please help!!

BEH

It’s time to put debt behind you and start dreaming about your life after debt. – Click to Tweet

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  • Damon Day

    ok, well, what are your current interest rates? What does your credit look like?

  • BEW

    Hi Damon Day,

    Thanks for the comment. the BK ting is two fold, one I think i amke way too much money to do that and sdecondly in all my years of paying bills, etc I have only been late maybe 5 times on a payment and that was truly due to a mistake on my part or mail dilivery. I am diligent in keepimg all bills paid welin advance of due date. I still can keep them paid at this point, but do not seem to be making any headway. It is/was definately my spending habits, although I keep a tight budget as far as having the money to pay everything, but now have little left to live on. I do have a car payment and truly besides the credit cards, that is the only payment I have besdies rent and utilities.

  • Damon Day

    Hello BEH,

    Well there are certainly a lot of options available for attacking debt. Creating a realistic spending plan, renegotiating interest rates (directly or with CCCS), settling the debts, bankruptcy, a consolidation loan etc.

    Whether one of those or something else is your best option depends on your situation. One thing that stuck out to me was that you are five years away from retirement. That means that the opportunity cost to paying down debt vs saving for retirement will be that much more compounded for you vs someone who is only 35.

    Ultimately the decision will be based on your current and future cash flows, net worth, and your life circumstances. You will have to make some decisions about what is important and what can be sacrificed.

    You mentioned you didn’t want to file BK. Can you tell me the reason why? I am not suggesting that as the best option at this point, but it helps to understand your current mindset.

  • http://DamonDay.com Damon Day

    Hello BEH,

    Well there are certainly a lot of options available for attacking debt. Creating a realistic spending plan, renegotiating interest rates (directly or with CCCS), settling the debts, bankruptcy, a consolidation loan etc.

    Whether one of those or something else is your best option depends on your situation. One thing that stuck out to me was that you are five years away from retirement. That means that the opportunity cost to paying down debt vs saving for retirement will be that much more compounded for you vs someone who is only 35.

    Ultimately the decision will be based on your current and future cash flows, net worth, and your life circumstances. You will have to make some decisions about what is important and what can be sacrificed.

    You mentioned you didn’t want to file BK. Can you tell me the reason why? I am not suggesting that as the best option at this point, but it helps to understand your current mindset.

    • BEW

      Hi Damon Day,

      Thanks for the comment. the BK ting is two fold, one I think i amke way too much money to do that and sdecondly in all my years of paying bills, etc I have only been late maybe 5 times on a payment and that was truly due to a mistake on my part or mail dilivery. I am diligent in keepimg all bills paid welin advance of due date. I still can keep them paid at this point, but do not seem to be making any headway. It is/was definately my spending habits, although I keep a tight budget as far as having the money to pay everything, but now have little left to live on. I do have a car payment and truly besides the credit cards, that is the only payment I have besdies rent and utilities.

      • http://DamonDay.com Damon Day

        ok, well, what are your current interest rates? What does your credit look like?

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