We have a problem at our house, and I want to tell you about it. We owe approximately $17,000 to credit card companies.
I do not really know how to write about this.
We have been without credit card debt three times in our married life: first, when we were first married; then for less than six months when Triss was a toddler; and for less than six months around five years ago.
Two years ago we went through Financial Peace University. We cut up our credit cards, except American Express. We saved our emergency fund. (Then spent it. Then saved it again. And spent it. Then saved it. And spent it. You get the idea.)
We got rid of AMEX a little over a year ago. We even paid off the debt to American Express a few months ago. But the other credit card debt hangs on.
Our Achilles' heel has been the overdraft protection loan attached to our checking account. We tend to go into that every couple of months, because we don't have a good budget. We continue to try to apply Dave Ramsey principles to our budget, but just cannot get a handle on it.
Needless to say, we are treading water. At this point, over $400 of our income per month goes to credit card companies, and we are barely making a dent in the debt.
Mr. Honey and I decided we couldn't do this on our own anymore. We just don't have an intuition for this kind of thing. We took a class and tried and tried to apply the principles to our own financial situation and kept messing up. We read books and kept messing up. We asked for and received advice from friends and family and kept messing up. So this week we paid a Dave Ramsey financial coach to help us think through our specific situation and redo our financial strategies. Neither of us wanted to pay someone to help us, but we tried the other avenues first. We have been trying and messing up for over a decade, and we just need help.
There is a certain amount of shame involved in paying someone to help with basic finances. But it would be a worse shame to continue the way we are currently and not ask for help.
We spent three hours this weekend with the coach, unpacking and repacking our budget.
It was gratifying to hear him say that we are frugal in our spending. (I know, how can someone be frugal and run up $17,000 in credit card debt? I cannot answer that satisfactorily, but I will say that we are somewhat frugal in the way we buy groceries and shoes and clothing and schoolbooks-- nothing like these ultra-frugal families, but we try. We just have more expenses than income at times.)
He didn't tell us to sell the house or the car, so we are all right there.
Our problems are that we don't have a saving plan for the little 'life happens' moments, and that we need some extra income to apply diligently to the debt in order to shrink it more quickly.
With the Lord's help, we are going to fix this.
It is going to be hard. I can hear my inner spoiled child gearing up for a tantrum right this minute. I like things to be easy. That is another reason I am sharing this with you. I want to be a good Christian, and I want to be honest. I have this struggle, and it impairs my witness.
I will post occasionally and tell how things are going.
I can already tell you that no one will be playing in orchestra or chamber groups or going to extra PE-type classes this year. Or ice skating. I am going to try to significantly reduce our food bill. We have been advised to give up trips. I am adding piano students and looking for other ways to earn a few extra dollars. Mr. Honey is growing his territory at work (he is a salesman).
We are going to stop paying into retirement until we get the credit cards paid off. I really want to get the credit cards paid off quickly, because it makes me very nervous not to be paying into retirement. We figured out yesterday that we would have to pay $1400 per month to the credit card companies in order to have the cards paid off in a year. That is $1000 more than what we currently give them each month. I don't know if we can pay them off in a year. It certainly illustrates the seriousness of our situation.
The kids want to go on the radio and shout that our family is debt-free. Me, too. I always get tears in my eyes when I hear a family do that. Will it ever be us? It has to be. We cannot live this way forever. It is so guilt-inducing, so stressful, and so ungodly.
So now you know. And I ask you to please pray for us.