Results 1 to 12 of 12

Thread: Finally out of debt, this is scary, don't trust myself

  1. #1
    242_fair
    Guest

    Default Finally out of debt, this is scary, don't trust myself

    For the first time in about 2 years, I am totally out of debt, and I don't know if I can handle it.

    Line of credit paid, credit cards paid, all accounts up to date, almost out of my car lease.

    So of course the bank sends me a letter offering to double the line of creidt to $20,000.

    It is really scary that I cant trust myself with my own money. I am afraid that after I give back the leased car they will talk me into another one. I could pay $5000 cash and get a road-worthy vehicle, but I am soooo tempted to get another expensive car.

    I can feel myself about to make another huge financial mistake. Why can't I just enjoy being free from debt, and living so confortable within my means?

  2. #2
    Yekhefah
    Guest

    Default Re: Finally out of debt, this is scary, don't trust myself

    Well, if the money is just burning a hole in your pocket, you could always knock a hole in MY debt for me!

  3. #3
    God/dess scarlett_vancouver's Avatar
    Joined
    Jan 2004
    Location
    Vancouver, BC
    Posts
    6,699
    Thanks
    0
    Thanked 22 Times in 20 Posts

    Default Re: Finally out of debt, this is scary, don't trust myself

    You're stuck in a pattern. You get the gratification of familiarity by putting yourself into debt. That's what Suze Orman would say, anyways.

    Make a new habit of saving wherever you can and being frugal- after awhile you'll be very used to it.

    Good luck!

    Feature costumes for sale!

  4. #4
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Finally out of debt, this is scary, don't trust myself

    technically, you're NOT actually out of debt yet... you're only CURRENT on your leased car debt. Consider setting your next goal as saving up a wad of cash so that when your present car lease runs out you can afford to buy your own car outright (or at least finance it with enough down payment such that the loan won't be underwater). When you're driving a dependable car that you don't owe payments on (or at least a car whose current market value is higher than the outstanding loan balance), THEN you'll be out of debt.

    Congrats on a job well done ... so far !

  5. #5
    God/dess Deogol's Avatar
    Joined
    Dec 2003
    Posts
    5,493
    Thanks
    120
    Thanked 50 Times in 35 Posts

    Default Re: Finally out of debt, this is scary, don't trust myself

    Yep - second Melonie's comments.

  6. #6
    242_fair
    Guest

    Default Re: Finally out of debt, this is scary, don't trust myself

    Quote Originally Posted by Melonie
    technically, you're NOT actually out of debt yet... you're only CURRENT on your leased car debt. Consider setting your next goal as saving up a wad of cash so that when your present car lease runs out you can afford to buy your own car outright (or at least finance it with enough down payment such that the loan won't be underwater). When you're driving a dependable car that you don't owe payments on (or at least a car whose current market value is higher than the outstanding loan balance), THEN you'll be out of debt.

    Congrats on a job well done ... so far !
    I get to give back the car at the end of the month. No refund and no miles charges. So then I will be free.

    Like I said, I know I can get a toyota corolla or a jeep (for the snow) for like $5,000. It is just so tempting to get another flashy cool new car.

    Like my mum would say, it's hard to go from the penthouse to the outhouse, if you know what I mean.

    But the other good thing about an older car is that I only need 50% insurance coverage, like to cover me if I hit someone.

    I don't need colisison on my own vehicle. And that alone will save me like $200 a month, plus car payments, so that's like $600 at least...

    I dunno. It's not easy. When I went in to ask about settling up the lease this week, the sales guy was like 'You need to drive THIS one, just for a test today', and he puts me in this 2006 BMW coupe and it's all shiny and red and smelling like new leather. "For just $400 a month, you can drive THIS baby all over town".

    Then all I can think about is me and my doggie hanging out the window and showing off. It is so redundant actually.

  7. #7
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Finally out of debt, this is scary, don't trust myself

    leasing is what it is ... incurring a time denominanted debt in exchange for the 'use' of something which you will never own i.e. a pure 'expense' with high interest to boot.

    If you really are susceptible to the appeal of a sexy new car, in order to take a realistic view of the costs involved you have to think in terms of ownership not 'renting'. This means thinking in terms of a $10,000 down payment, plus an $1000 per month car payment for the next 4 years. However, at the end of those four years, you will OWN an asset with a cash resale value which you can continue to drive without continuing to pay for the privelege on a monthly basis. Compare this to putting $10,000 cash towards a halfway decent used car, which immediately becomes an asset that you can continue to drive without monthly payments.

  8. #8
    242_fair
    Guest

    Default Re: Finally out of debt, this is scary, don't trust myself

    I know. A neighbor of mine has an old mercedes, the licence plate says PAIDNFUL. I am jealous of her all the time.

  9. #9
    madmaxine
    Guest

    Default Re: Finally out of debt, this is scary, don't trust myself

    I'll give you a few good reasons to stay out of debt & start saving in earnest:

    1) You could get sick & be unable to work. I know Canada has socialized medicine, but you still can't be pulling cash in if you're stuck in bed.
    2) Family emergency- that would put another dent in your time & drain your savings (sick parent, sudden death in the family, etc.)
    3) Having expensive cars is a waste of money. Cars depreciate like no other investment. Why not purchase a house, or make some major stock purchases? I just read about a guy who cashed out of his ethanol company at a cool $25 million dollars. He'll never have to work another day in his life.

    I treat budgeting like a game. My uncle lives this way and is a self-made millionaire. Sure it's not glamorous, but you'll never end up old, broke & dependent on someone else.

  10. #10
    God/dess Deogol's Avatar
    Joined
    Dec 2003
    Posts
    5,493
    Thanks
    120
    Thanked 50 Times in 35 Posts

    Default Re: Finally out of debt, this is scary, don't trust myself

    I have a paid off BMW. It is a nice feeling to have no bills!

    You don't need to buy a NEW BMW - you can by a pre-owned certified one. Basically the same thing but far less money. Doing so will put you two years ahead in paying it off.

    When I told some people I had paid off the Beemer, I was told I was now part of the other set of luxury car owners. See, there are two types - them that can afford to buy and them that borrow the car (from the parents) for a little while.

    In the coming economy, I suspect a jeep may be more useful. As the government gets more and more broke, the snow plows will be running slower. Then the roads will be in bad shape in spring and won't be fixed as fast.

    I now return to watching "The Day After Tomorrow."

  11. #11
    God/dess GoldCoastGirl's Avatar
    Joined
    Oct 2002
    Location
    ...hehehe... email me to ask me where i am ! (i dare you!)
    Posts
    11,486
    Thanks
    42
    Thanked 127 Times in 51 Posts

    Default Re: Finally out of debt, this is scary, don't trust myself

    Ah... has anyone bothered to remind 242 that there is a HUGE difference between GOOD debt and BAD debt? Like using other peoples money to buy a business (produce income as well as an asset) or invest in some other way ? If you can use the loan/debt to produce income or increase your net worth in some way then it is good debt.

    Plus use of the word NO works wonders (you had every choice to say NO to the test drive).


    enter: E3167322D9 for your 10% discount

  12. #12
    Veteran Member StuartL's Avatar
    Joined
    Feb 2006
    Location
    European Man Of Mystery
    Posts
    648
    Thanks
    1
    Thanked 21 Times in 7 Posts

    Default Re: Finally out of debt, this is scary, don't trust myself

    Just try to build a budget and stick to it.

    If you are really worried about it, then use the opportunity to save as a way to spend ... this isn't great advice, but maybe you could just save up for holidays or something. Just getting into the habit of saving and then only spending on a specific item is a start. You can progress to saving for savings sake later.

Similar Threads

  1. Replies: 17
    Last Post: 11-10-2011, 10:03 AM
  2. The thing I don't get about the debt ceiling.
    By Clement in forum The Lounge
    Replies: 2
    Last Post: 08-05-2011, 10:52 PM
  3. What happens if you don't acknowledge a debt?
    By cutey5032 in forum Dollar Den
    Replies: 7
    Last Post: 02-12-2008, 10:24 AM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •