I live outside the US (Colombia, to be more specific) and since some of the facts and options in many get-out-of-deb sites does not apply to people in my country, the basics and the methods are valid here.
Now I have a special situation, I’m self employee, I make around US$800/mo, my wife is an employee, she makes around $900/mo, and we want to get out of debt but now we want to buy a car and she is going to get a loan to make an specialization in her field. I’m now keeping and eye and tracking record on my expenses, trying to figure out a budget.
Is it possible to get out of debt in this case since we are about to get into debt to get a car and to study?
The fundamental process to get out of debt is universal, simply spend less than you make.
It sounds like you have a need to purchase a car and for your wife to go to school and you are going to go into debt to achieve those goals.
Debt is nothing more than pledging future labor and income from that labor to repay money that your borrow today. The price to borrow that money is the interest rate charged you and the lender is counting on you repaying those loans without fail. The terms of the loan will be disclosed in the loan document.
I’m glad to hear that you are working on a budget to figure out where your money is really going. That will give you a lot of information about how much you can borrow without getting in a position where you are spending more than you earn each month.
Just be sure that even with the new loan payments you are still able to save money each month. You want to make sure that even while you are getting out of debt you are still able to save money in case of an unexpected expense.
Let me know what your total expenses are each month, the cost of the car loan and student loan on a monthly basis. Then I can give you more specific advice about your plan.
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