I have a dream....but little to no money

[THEFAN]

Sell all non-essential items in your life. We did this this past summer and made over 2400.00 to pay off the rest of our debt. Lawn sale, craigs list, and ebay. Now it is time to pay the rest fo the house off. In less then 10 yrs we will be debt free completely. not bad by the age of 45 is these times. But seriously you will be amazed what you have laying around that you can sell off.

 

[hqueen13]

Wow GD, that sounds awesome! I hope we can find something like that some day! I know we have so much learning to do, and that kind of a 'security blanket' would be amazing!

 

[hwillm1977]

Hubby and I didn't have a lot of money to buy a house either. We bought a trailer in a park first, it needed updates and we paid it off in three years and sold it for more than we bought it for. We used that money as a down payment on a house that we found someone willing to 'rent-to-own' to us. There were tons of conditions, and we had five years to pay the house off completely. Where I live we bought a 3-bed, 2-bath house and 6 acres of land for $25,000. There was no running water or electricity when we moved in so it's not like it was a nice house. AND it took us almost a year and asking almost 100 different home owners if they were willing to rent-to-own before we found this place.

That was 4 and a half years ago, and we paid the house off this month... it's OURS. But it's tiny and there's not enough land here to really do any farming. With the fix-ups we've done we can now sell this place for around $100,000 and that will buy about a 50-100 acre farm here (that again needs fixing). It took us a total of 10 years from when we started out on this 'getting a farm' idea... but we're 34 now and can buy our farm cash without having to worry about a mortgage. We're still planning on staying in the paid off house for a few years so we can save up some extra wiggle room (like a 6 month emergency fund) and have ALL of our debts paid off. I want to be in our dream farm before my kids start school (our daughter is 13 months old and #2 is on the way). I agree with Moolie, not adding to debt feels GREAT... and the more you pay off, the better you are going to feel. It really is a snowball once you start down the path of getting everything paid off.

I wouldn't think about getting your dream place on the first try, but maybe steps you can take to work your way toward that dream without getting in over your head. Can you rent a cheaper place, or buy a tiny place, that needs a little work so you could probably sell for a profit, to live for a few years while saving like crazy and paying off debts?

We have a program for buying farms here too, Farm Credit Canada... they require 25% down (which is pretty standard for a farm property here) but they have perks like deferring mortage payments for years so you can build up stock/income, rolling equipment and livestock purchases into the mortgage, etc.

 

[Soybean]

Thanks for all the advice. The $700 is before payments on debts. The debts are actually 3-4 years old. We didn't have much income at the time (we were both working part time retail) and the bills just sat there. So there is no more interest on the cards as they have closed the accounts so we just have to pay what we owe on them. My husband is in the process of getting together everything we owe and calling each debt and finding out how we can best pay them off. We only just started having this better income because I got a full time job and I am making twice as much as I made in retail. Our plan is to set aside $200 each month as an emergency fund/savings. The other $500 will go towards the debt. In 12 months, that's 6k of the 10k we owe. In a year we could have over half our debt gone. We will be looking for a house to rent when our least is up here. We want to try renting a house where the rent is cheaper than what we pay now. We pay $850 for a two bedroom apartment. We want to find a house to rent for about $6-700. We have cut out cable and internet (I get on the internet at work before my shift).

 

[dfr1973]

Since the credit card debt is old and closed, try negotiating a lower payout ... and throw as much as possible to the e-fund to get it up to level first. Once you have the financial "security blankie" of an e-fund, you will never want to be without it again. In addition, it will help with negotiating settlement if you can say "I have $x,x00 dollars I can pay right now to settle this in full." I'll bet at least a third of those totals are penalty and late fees ... that they can and often will waive just to get it off their books.

 

[~gd]

Wow GD, that sounds awesome! I hope we can find something like that some day! I know we have so much learning to do, and that kind of a 'security blanket' would be amazing!

Of course there is a flip side. You can't blame the kids thst are not interested in farming and can earn more with their skills and knowledge. They lived on a farm and know the hard work, long hours, and pay that can vary lots depending on luck for weather and markets. there is also a fair turn over from the program as people lesrn that farming isn't as easy as they thought it would be. I think they had this program and it was failing and only picked up again as off the farm jobs became hard to find. If you are willing to work hard and learn it can fit well with the SS lifestyle.

 

[hqueen13]

Interesting. I have no delusions about how hard it is to work on a farm. I am grateful for our experience here as we are not responsible for the brunt of everything. We have others to share the work load of the horse care with, and that sure makes for a cushy farm life!
And really, our bigger plan is that the other half will get promoted to branch manager in his job, and we can move somewhere more rural, and that his job will support us and the farm while I can work to get/keep the farm running. That way we can work slowly to establish ourselves and profit coming off of the farm without having to suffer the pains of the unpredictability of farming.
Now, we'll see if that is actually what happens!!

 

[hwillm1977]

Since the credit card debt is old and closed, try negotiating a lower payout ... and throw as much as possible to the e-fund to get it up to level first. Once you have the financial "security blankie" of an e-fund, you will never want to be without it again. In addition, it will help with negotiating settlement if you can say "I have $x,x00 dollars I can pay right now to settle this in full." I'll bet at least a third of those totals are penalty and late fees ... that they can and often will waive just to get it off their books.

DEFINITELY do this... hubby had an old student loan (here in canada, even once the account is closed and goes to collections you are still charged interest every month until it's paid off) that he owed $2700. It was in collections, they called all the time... really awful. He said he wanted to settle the debt for less than he owed... he offered $800, they took $1200 to write the debt off.

Offer a lump sum of at least half of what you owe and negotiate from there... you may end up only having to pay 5-6000 of the 10K that you owe That would mean you could be completely done in a year.

 

[Leta]

Oh, yes! Sorry I missed this. You should do it with medical bills, too- specifically ask to pay the rate that the major medical insurance carriers pay.

I had a private student loan that my mom cosigned on. It was before the term "predatory lending" had blown up, but that's what it was, really. The interest went nuts, so did the fees. I borrowed $7K, and within three years it had doubled.

My mom negotiated- we ended up settling for the originally borrowed amount, and she and I split it just to get it off our credit. It was a PITA, but very, very worth doing.

 

[Avalon1984]

Hey Soybean! Kudos for working on your debt. We all are or were there at one point. I had the same problem and I have been working each month on paying the cc debt and the truck off. I managed to get rid of 57% of my debt in one year, so I will be all out of debt next year. My help was that each month, after utilities are paid and you start working on paying on your debt, use your original total and then add your current total and see how many % points you have come down from when you started. To me it was very motivating to see that I had paid off another 5 or 6 % of my debt per month. Being frugal over a long time can take a toll on your mind but this way you always keep the big [picture in mind. Good luck! You are on the right track.