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jvrban

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How do I boost my credit when I make 40% less than I did 4 years ago ?
4 years agog I lost my 38,000 dollar a year job, was out of work for 1 year only able to find a part time job. Then my wife lost her job soon after, for about a year. I finally started working full time about 2 years ago, but only make 22,000 a year and my wife makes about 32,000 a year compared to 40,000 before. I have no credit cards, they are all in collections, the little bit that we had in savings is all gone. I am trying to go back to school and finish some kind of degree or at least a certificate. My car payment is 516.00 a month because our credit rating was horrible. It just keep getting worse, not better. I am losing hope, do I have any left?

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There are a few routes to go...if there is definitely no light ahead, and your debt is unattainable for any kind of control....then file for bankruptcy. If you don't want to take that route (it's not for everyone), there are a few things you can do until your financial situation gets better. 1. DO NOT LET THE DEBT COLLECTORS BULLY YOU!!!!!! They get paid to make you pay as much as THEY want you to! If you don't want to deal with them on the phone, send them $10-$20 a month in the mail with the statements they give you. They get paid on commission, so the more you pay on the phone, or the higher your payment plan, they more that person on the phone gets paid. If all you can afford is $10-$20 a month to each, it is better than nothing! And, because you are still making payments, you won't get dinged for non-payment. 2. GO BACK TO BASICS! Sometimes, you have to remember what your life was like before you had money. (I've had to do it-I lost my job for 6 months and had a newborn). Sometimes you have to remember that all you can afford right now are the basics. Nothing fancy anywhere. Allow yourself one "luxury" a month so that you don't feel like you are working only to pay bills- because, let's be honest...no one wants to live that way. My "luxury" was spending $20 a month to get my nails done. No more $5 Starbucks, and $7 lunches, etc every day or every other day. Pack your lunch- PB&J can be your friend when you are tired of ramen noodles. 3. IF POSSIBLE, PAY HALF OF YOUR BILLS EACH TIME YOU GET PAID. It is amazing how, if you restructure the way you pay your bills, how it can make a difference. Like with your credit cards, even though maxed out and in collections, you save on interest by paying every 2 weeks instead of on the due date once a month, because even if it isn't the minimum due, you are still paying before the due date. Same for your car payment (if you have one). And if your mortgage company will let you pay before the due date, it works there, too. As for your other bills- if your water bill is usually $100 a month, pay $50 per check, no matter how much the bill is. Sometimes you will have a credit (because you overpaid), and in those summer months when you are using more water, you won't have to pay more, because you will have built up a credit from still paying that $100 a month when you were only using $60 worth of water. (for example). 4. STILL PUT MONEY INTO SAVINGS. If you can, do an automatic transfer every payday for a small amount that you would never miss....$1, $5, even $10- and while slow, it will put some money back in your savings. Another thing my husband and I do, we have something called a "Broke *** Fund". It's a jar that we put our spare change in (if our toddler doesn't steal it for her piggy bank first). Then, whenever we are desperate and need a couple bucks, we have some change. Or, if we let it fill up enough and need groceries, we cash it in at the store, and then use the money for necessities at the store. Just a few words that have helped me in that situation....GOOD LUCK! Things will get better, I promise! PLUS- if you can make this work for you, and stick to it, once you do get "back on your feet", if you continue with this kind of spending, you will be able to quickly rebuild your savings, too.

Reply by
jvrban

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Thank you so much for the tips, never thought about paying half the car and some fixed bills every couple of weeks. Thanks again, God Bless and God speed!

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