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rated:
Hi there!
I need help figuring out how to pay off my debt!
I have 19,000 in credit card debt and $22000 in student loans (parent plus) I took out for my sons' college.
any help would be appreciated!
thanks!

rated:
Need details - How much on each card and at what interest rate. How much in mortgage and other living expenses. What is your monthly take home pay, etc... For a good example, try this thread http://www.fatwallet.com/forums/finance/1172072/

rated:
Ya, sorry, I was just reading through that thread,
here is my details
We make about $70 K a year

Parent Plus loans
$4891 7.9%
$8119 7.65%
$1018 8.25%
$2368 8.5%
$4225 6.5%

Credit cards
$8240 0% for another 10 months
$5000 0% for 18 months
$1296 8%
$2409 12 %

my Credit score is excellent

rated:
Just to keep things at a high level, generally advice boils down to:
-Make more money
-Cut your expenses
-Pay down highest interest % first

rated:
manderson660 said:   Ya, sorry, I was just reading through that thread,
here is my details
We make about $70 K a year

Parent Plus loans
$4891 7.9%
$8119 7.65%
$1018 8.25%
$2368 8.5%
$4225 6.5%

Credit cards
$8240 0% for another 10 months
$5000 0% for 18 months
$1296 8%
$2409 12 %

my Credit score is excellent

Check out the IBJanky thread. There are quite a few good pointers in there.

Quick summary of steps IBJanky took:
  1. Realize you have a debt problem. You've already taken this step by looking for help.
  2. Track spending for a month to see where you can cut
    1. What is not necessary? Get rid of it. Cell phone and land line? Get rid of one. Cable? Cut it.
    2. What can be reduced/lowered? Have you asked for lower interest rates from your credit cards? Have you shopped your auto/home/life/etc. premiums recently? Are you brown-bagging your lunch or eating out every day?

  3. Devise strategies - lowest balance vs. highest interest rate battle. How much to put toward the debt every month?
    1. Pay off lowest balance first - Pay more interest but earlier sense of accomplishment.
    2. Pay off highest interest rate to lowest interest rate - Pay less interest but no immediate gratification.
    3. After you've cut your expenses, figure out how much you can comfortably put toward the debts every month and stick with that number. If you have extra at the end of the month, pay in more.

  4. Track as you pay everything off and watch for 0% APR with low transaction fee deals you can potentially transfer high interest balances to.


That being said, I would start with the 12% credit card, followed by the 8% credit card. Student loan interest is deductible for everyone, so your effective interest rate is lower by your highest marginal tax rate. Then go after the highest interest rate student loans until the 0% deals expire, but don't hesitate to transfer your highest-interest balances to a promotional rate with a low transaction fee if it comes along.

A few things to consider

  1. Don't cut out entertainment/fun/eating out entirely, just cut back. Not having fun will make you dread this entire process. If possible focus on your least expensive hobbies.
  2. Make sure your spouse/whoever is the other part of the 'we' you mentioned is 100% on board and agrees with the plan of action.
  3. It may be hard to ask him, but can your son help foot the cost here?

rated:
I filed my taxes a couple weeks ago and ended up paying about $30. My parents set up a separate account for college related expenses, but I didn't realize I was actual owner and needed to file taxes appropriately. The gains were less than $50. Should I bother refiling? What would be the penalty if I got audited?

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Greatest impact on credit?

Apologies for the CreditBoard-ish question. We recently walked from our mortgage and now have a foreclosure and charge off (HELOC) reporting. Before we missed a payment, we purchased a new car because we knew 1) our once strong credit would soon be a thing of the past, and 2) this installment loan would help us reestablish our credit and on-time payment history. We're only paying 0.9% APR and have 4 years left on the loan.

Simply in terms of credit implications, is there any consensus on what would have the greatest impact on my overall profile? 1) paying off the auto loan over the next few months (I believe this account, even though paid, will continue to report), or 2) continuing to make on-time monthly payments for the full duration of the loan?

I understand the arguments that I could earn >0.9% elsewhere, as well as the merit/feeling of being completely debt free (which is my preference), but I'm simply looking at this through the lens of its impact on my credit in order to position myself to qualify for a new home loan in 3 years (FHA minimum requirements).

If it matters, I have a 20 year credit history, some large credit lines reporting (other limits were slashed by the banks), ~115K available credit, no other debt reporting, and a credit karma score of 695.

Thanks in advance.

rated:
txrandom said:   I filed my taxes a couple weeks ago and ended up paying about $30. My parents set up a separate account for college related expenses, but I didn't realize I was actual owner and needed to file taxes appropriately. The gains were less than $50. Should I bother refiling? What would be the penalty if I got audited?
What do you mean "gains"? Was this interest income and did you receive a 1099 from the bank? If so, the IRS has received the same information and likely might get caught at some point. I dont now if IRS will bother to "audit" based on this but can likely send you a bill. It doesnt take much to file an amendment, if this is the only thing that needs to be fixed.

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for those who hold balances on 0% credit cards, im sure that affects getting pre-approved for mortagages, correct? how long should that be paid off to ensure a decent or good rate on mortgages?

rated:
The question isn't how long, but how much you are carrying on the cards and will it impact your ability to make XX dollars in total payments per month including the new mortgage. Best suggestion - Talk to a broker, give them your credit score (do not let them do a pull until you are really ready to shop), income and credit card balances and see what they think you can handle for a payment. If you don't meet their thresholds, then you may need to pay down those 0%'s.

rated:
ic .. i thought u had to clear it a while before u get preaprpoved even if you can pay it off easily

rated:
Relocation question...

Anyone in So Cal? I'm contemplating a move to LA from the rust belt Midwest. How's the economy doing there? Is the job market still very sluggish? Are taxes really that bad?

Thanks!

rated:
LongDongSilver said:   Relocation question...

Anyone in So Cal? I'm contemplating a move to LA from the rust belt Midwest. How's the economy doing there? Is the job market still very sluggish? Are taxes really that bad?

Thanks!
You probably need to make 30% more just to break even with midwest.

rated:
Hey. I found this website thru this link:
http://www.fatwallet.com/forums/finance/1078557/

Is that thread totally dead/locked? I have had a hard time trying to increase my banking transfer limits. Otherwise really cool site!

rated:
theskillzdatklls said:   Hey. I found this website thru this link:
http://www.fatwallet.com/forums/finance/1078557/

Is that thread totally dead/locked? I have had a hard time trying to increase my banking transfer limits. Otherwise really cool site!

It is "archived". You can read but cannot post anything to that thread.

rated:
Tax and IRA question.

I've already filed my taxes, received my refunds, etc. However I made a contribution to a non-deductible traditional IRA just recently for 2011 and have since converted it. I believe I finally understand the trick to the backdoor being you make a contribution for 2011, convert in 2012 the day after the contribution thus avoiding any taxes unless the value went up that day, and then you need to note the conversion on form 8606 for 2012 taxes. However, do I need to go back and ammend my return, submit 8606, or just track it based on the fact that I now have a traditional IRA that I contributed to for 2011?

rated:
If I purchase an item in a county w/for example 8.25 sales tax & i return the item to a store in a county w/ a sales tax rate of for example 7.25, do I not get back the full amt of tax I paid back? And what about the reverse. If I purchase an item in a county w 7.25 sales tax & return to a county w/ 8.25, will they give me the difference in tax back? Does what I'm asking make sense?!

rated:
elannmac said:   If I purchase an item in a county w/for example 8.25 sales tax & i return the item to a store in a county w/ a sales tax rate of for example 7.25, do I not get back the full amt of tax I paid back? And what about the reverse. If I purchase an item in a county w 7.25 sales tax & return to a county w/ 8.25, will they give me the difference in tax back? Does what I'm asking make sense?!
In an ideal world, you will be refunded the tax rate you paid. Some stores (particularly large national chains) cash registers are programmed correctly. In some stores, you simply get refunded the rate for the store you return at.

rated:
I made several trades on IRA, Roth IRA and Educational IRA. Do i report these transactions while filing taxes? I am not taking out the money from these accounts, they stay in the same accounts. Thanks,

rated:
eluck said:   I made several trades on IRA, Roth IRA and Educational IRA. Do i report these transactions while filing taxes? I am not taking out the money from these accounts, they stay in the same accounts. Thanks,
Buy/sell inside an IRA have no tax consequence and dont have to be reported.

rated:
^^Which is exactly why I do my short term trading inside an IRA.

rated:
ngreen said:   Tax and IRA question.

I've already filed my taxes, received my refunds, etc. However I made a contribution to a non-deductible traditional IRA just recently for 2011 and have since converted it. I believe I finally understand the trick to the backdoor being you make a contribution for 2011, convert in 2012 the day after the contribution thus avoiding any taxes unless the value went up that day, and then you need to note the conversion on form 8606 for 2012 taxes. However, do I need to go back and ammend my return, submit 8606, or just track it based on the fact that I now have a traditional IRA that I contributed to for 2011?


Just fill out a 2011 Form 8606 with the correct information, sign it on the back, and mail to the same address where you would send your Form 1040. Form 8606 has a separate signature block on the back and you can send it in independently if it doesn't affect your tax. If all you are doing is reporting a non-deductible contribution, there is no need to amend your return.

rated:
Does one have any recourse if your incompetent mega-bank improperly withheld federal income tax from an account opening bonus even though you faxed in a signature card affirming that you are not subject to backup withholding (which they didn't bother to process)?

thanks for any advice you may have

rated:
^^ should report on your 1099 INT, in which case, you should be able to claim it on your taxes.

rated:
Usorry said:   ^^ should report on your 1099 INT, in which case, you should be able to claim it on your taxes.
So it will report on a regular 1099 INT, and we just include that under tax payments made on our 1040?

Is there any way to reverse what the bank has done? Is it worth bothering?

thanks

rated:
beethovengirl said:   Usorry said:   ^^ should report on your 1099 INT, in which case, you should be able to claim it on your taxes.
So it will report on a regular 1099 INT, and we just include that under tax payments made on our 1040?

Is there any way to reverse what the bank has done? Is it worth bothering?

thanks

The bank has the ability to fix the mistake but there's probably a small amount of employees that actually know how to do it. I wouldn't bother complaining. I try not to bite the hand that feeds me. You'll get the money back/credited when you file your taxes.

rated:
^^Depends on the amount of money and the type of account. If it is a regular savings with a high balance, fix it going forward so that you don't diminish the wonder that is Compounding Interest.

rated:
re: ATM in Tahiti

from past reading, I setup PenFed for the 1% before my trip to Italy. I kept my accounts for future international travel+ possibly getting a car loan from them. I'm heading to Tahiti for my honeymoon in June. So started my research, and i'm surprised to see things have changed a bit. It does say up to 2%, which i'm comfortable paying. But i'm reading for Tahiti, it's better to swap currency with Wells Fargo then to pay the ATM fees. I also have the BA no forex fee which I intend to use everywhere I can. But we land late in PPT and will need a taxi to our hotel.

Maybe i'm missing something. I used WF online swap converter and it looked like I was paying 6-7%. So i'm assuming the difference from 6% and 2% must be either an ATM fee or a bad exchange rate at the ATM/banks in Tahiti? Not that I dont trust the regular Tahiti travelers on the advice to just use WF. Just the regular traveler is NOT the AVG-FW =)

- oh...also to take into consideration, is that the ATM may be down/out of money upon my arrival. I plan to pull $1000 for my week trip (Fn everything is so expensive there) for anything requiring cash, and to pay off my hotel charges before I leave.

TIA

rated:
Quick question on mortgages - hoping a mortgage broker out there can help me.

My wife and I have around $280,000 in student loan debt and a $22,000 car loan. Monthly obligations are about $4,200. I make $145k/year and am wondering how much a lender will approve me for. The online mortgage calculators say my "back-end" ratio is too high, but is this a hard criterion for lenders? If I gross 12k/month, shouldn't I be permitted a higher ratio than someone who makes $4k/month? Yes my debt obligations are large, but my other expenses are roughly equal to someone making much less. So in theory I should be able to afford a much larger mortgage.

Thanks.

rated:
lastgaspjr said:   

Just fill out a 2011 Form 8606 with the correct information, sign it on the back, and mail to the same address where you would send your Form 1040. Form 8606 has a separate signature block on the back and you can send it in independently if it doesn't affect your tax. If all you are doing is reporting a non-deductible contribution, there is no need to amend your return.

Thanks, that's exactly what I ended up doing. Was worried I needed an ammended return as well but the consensus seems to be to only send the 8606.

rated:
Suggested input regarding auto insurance claim.

I am the owner of an auto driven by a family member of my car. I was present.
My car was hit from behind at a toll plaza. My car was in line, stopped.
The rear car was driven by a non-owner of the second vehicle.
The driver of the second vehicle did not have a driver's license. The police "took care of this on their end".

The police were called, and an accident investigation exchange form was completed by both drivers, and by me.
My insurance company is handling the claim.
The other insurance company is "investigating" the claim.

I do not know the exact damage amount. I am estimating $800-$1500. My collision deductible is $500, my uninsured deductible is $200.

Are these my options?
Let my insurance company handle it, and I wait for my deductible to be reimbursed?
File my claim directly with the other insurance company?
File an uninsured claim with my insurance company?

Any help, additional information I should know, or direction would be appreciated.

rated:
I was just going to ask the same question. I've got the answer now
One of SIS' posts convinced me to open a ROTH IRA today.
ngreen said:   lastgaspjr said:   

Just fill out a 2011 Form 8606 with the correct information, sign it on the back, and mail to the same address where you would send your Form 1040. Form 8606 has a separate signature block on the back and you can send it in independently if it doesn't affect your tax. If all you are doing is reporting a non-deductible contribution, there is no need to amend your return.

Thanks, that's exactly what I ended up doing. Was worried I needed an ammended return as well but the consensus seems to be to only send the 8606.

rated:
Any recommendations on how to evaluation commercial properties ? I posted in the Investment Property forum too, but no response. I am looking for something like zillow or any other evaluation technique I can use. Thanks.

rated:
I am filing my taxes with Turbo Tax, it shows few errors.. can someone throw some light on these?

1) Form 5329-T: Year end HSA should have a value, even if it is zero. My question is that i have two different HSA accounts from two different employers.. should i sum it up the two accounts and put the amount here? What is the context of why they are asking?
2) Form 8889-T: HDHP coverage check box needs to be checked.. what does it mean?

rated:
Student Loan Payback Strategies?

I graduated last year from a state university and started repaying my students loans last November. Since tax time is approaching I noticed there is a $2500 tax deduction for interest paid on student loans. I was planning on paying off my student loans asap, but started wondering if it makes more financial sense to pay the interest and get the deduction over the next few years? I have two loans: $4500 at 6% and $3500 at 6.8%. Additional details: I am recently married. My wife is currently not working but will be in the next several months. Currently making ~20k a year and we are stable enough to pay a bit more than the monthly payment requirements. We have enough in savings to pay off one of the loans completely. Would I get more back in taxes if I have a larger deduction from the interest or it it not worth it?

(P.S. I tried to graduate with having any loans to pay off, but it just did not work out. Degree is in the sciences.)

rated:
thelineage said:   Student Loan Payback Strategies?

I graduated last year from a state university and started repaying my students loans last November. Since tax time is approaching I noticed there is a $2500 tax deduction for interest paid on student loans. I was planning on paying off my student loans asap, but started wondering if it makes more financial sense to pay the interest and get the deduction over the next few years? I have two loans: $4500 at 6% and $3500 at 6.8%. Additional details: I am recently married. My wife is currently not working but will be in the next several months. Currently making ~20k a year and we are stable enough to pay a bit more than the monthly payment requirements. We have enough in savings to pay off one of the loans completely. Would I get more back in taxes if I have a larger deduction from the interest or it it not worth it?

(P.S. I tried to graduate with having any loans to pay off, but it just did not work out. Degree is in the sciences.)


The tax deduction for student loan interest means that you pay a lower effective interest rate. For
example if your marginal tax rate is 25% then your 6% rate is effectively a 4.5% rate. The government
is subsidizing your interest cost by giving you the deduction.

For 2011 you only get to deduct the interest you paid for those last two months of the year.

For a year of payments in 2012, you will have just under $500 of interest on your student loans,
if you just pay the minimum.
If your marginal rate is 25% then you will reduce your taxes by $125.
If you are in the 15% tax bracket, you will only reduce your taxes by $75.

To me there are two important considerations. First, how much interest are you earning on your
savings.

Second, how do those savings fit into your overall financial picture. If you only have $8K in total savings
and this money also serves as your emergency fund, then paying down both of your loans may not be
a good idea.

If you have $8K in savings above and beyond your needs for emergency funds, and the earnings on this money
is less than the effective interest rate you are paying on your student loans, then paying off the loans
now makes a lot of sense.

rated:
Thank you kenmoreland for fully answering my question.

rated:
Quick question on mortgages - hoping a mortgage broker out there can help me. My wife and I have around $280,000 in student loan debt and a $22,000 car loan. Monthly obligations are about $4,200. I make $145k/year and am wondering how much a lender will approve me for. The online mortgage calculators say my "back-end" ratio is too high, but is this a hard criterion for lenders? If I gross 12k/month, shouldn't I be permitted a higher ratio than someone who makes $4k/month? Yes my debt obligations are large, but my other expenses are roughly equal to someone making much less. So in theory I should be able to afford a much larger mortgage. Thanks.

Bump - does anyone have any experience with this issue? Any help would be greatly appreciated.

rated:
gwu1986 said:   Suggested input regarding auto insurance claim.

I am the owner of an auto driven by a family member of my car. I was present.
My car was hit from behind at a toll plaza. My car was in line, stopped.
The rear car was driven by a non-owner of the second vehicle.
The driver of the second vehicle did not have a driver's license. The police "took care of this on their end".

The police were called, and an accident investigation exchange form was completed by both drivers, and by me.
My insurance company is handling the claim.
The other insurance company is "investigating" the claim.

I do not know the exact damage amount. I am estimating $800-$1500. My collision deductible is $500, my uninsured deductible is $200.

Are these my options?
Let my insurance company handle it, and I wait for my deductible to be reimbursed?
File my claim directly with the other insurance company?
File an uninsured claim with my insurance company?

Any help, additional information I should know, or direction would be appreciated.


I was in a similar accident. Here's what happened to me:
-the other insurance company waited as long as allowed by law to respond to everything
-at the last deadline they requested binding arbitration (I could either accept it or sue, not much of a choice for a few $100.
-the arbitration was scheduled (this was itself a 6 month delay) and the day before the hearing, they settled and sent my insurance company money to cover the accident.
-I got my deductible back...but it took nearly a year.

Still, looking back, too much trouble for me to deal with myself.

rated:
talljay said:   gwu1986 said:   Suggested input regarding auto insurance claim.

I am the owner of an auto driven by a family member of my car. I was present.
My car was hit from behind at a toll plaza. My car was in line, stopped.
The rear car was driven by a non-owner of the second vehicle.
The driver of the second vehicle did not have a driver's license. The police "took care of this on their end".

The police were called, and an accident investigation exchange form was completed by both drivers, and by me.
My insurance company is handling the claim.
The other insurance company is "investigating" the claim.

I do not know the exact damage amount. I am estimating $800-$1500. My collision deductible is $500, my uninsured deductible is $200.

Are these my options?
Let my insurance company handle it, and I wait for my deductible to be reimbursed?
File my claim directly with the other insurance company?
File an uninsured claim with my insurance company?

Any help, additional information I should know, or direction would be appreciated.


I was in a similar accident. Here's what happened to me:
-the other insurance company waited as long as allowed by law to respond to everything
-at the last deadline they requested binding arbitration (I could either accept it or sue, not much of a choice for a few $100.
-the arbitration was scheduled (this was itself a 6 month delay) and the day before the hearing, they settled and sent my insurance company money to cover the accident.
-I got my deductible back...but it took nearly a year.

Still, looking back, too much trouble for me to deal with myself.
talljay, thank you for the information. It seem as though the other insurance company is following the same pattern you described.

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