This article is from personal
experience of hitting a financial wall and coming to a sudden stop. I
was 40 years old and my whole life stopped. I was financially
devastated and did not know where to turn. I had been making a good
income and my wife at the time was working full time and making very
good money. But then I walked into work one day and my job had come
to an end. I had no clue that this was going to happen. We had been
living high on the hog and had not been putting away any funds for times like
this, we had no nest egg or financial cushion to fall back onto. I was
devastated, I felt like my world was crashing in around me and I had no clue of where to turn or what to do.
My credit cards were close to being
maxed out and I had other bills that were closing in on me. I had
reached out to credit counseling agencies to try and help me get my
bills in order. They worked except they took every red cent I had and
put it all towards my debt, which is fine but it leaves you with
nothing which hurts when you have unexpected car repairs or home
repairs or a medical emergency. You cannot just pick up the phone and call your credit counselor and say I am skipping this months payment to
fix my car, the credit counseling agents do not want to hear this from you and they will not help when you have these
situation's. So unfortunately I had to take out other credit cards to
help when these issues came about.
I had also looked into a consolidation loans to
wrap all my debt into one account and one payment with a much lower
interest rate and a payment that I could afford. This would have been great but with no job and only my
wife's income I could not qualify for loan, I was what is called
“upside down”, my debt to income ratio was backwards or upside
down, I owed more monthly than what I had coming in as income. A
consolidation loan was out of the question, it would have been great but there was no bank or loan company out there that would give me the time of day.
Unfortunately a lot of these types of
programs do not work for people and they did not work for me either.
One thing that I did do that worked for me was to go and find a
professional debt settlement representative that could talk to the
collection agencies, credit card companies, and other people I was in
debt to and come up with a debt settlement that we all agreed too. A
lot of people frown on debt settlement because it does hurt your
credit report and credit score, but when you are in a position like I
was my credit score sucked anyways. I opted to take a hit on my
credit and pay off my debt at an agreed upon settlement instead of
filing bankruptcy. The process can take two to three years of work
but I was able to get my bills paid off and in the process I had
found a new job and I took that income and applied it to my overall
debt.
The whole situation was a wake up call
for me. I knew from this that I needed to start storing away some
funds on a weekly basis to cover me for three to six months just in
case one of us loses our job again or we get sick and cannot go to
work and we have to live on one income again. Everybody needs to make
sure that they have at least six months of income stored away in case
of emergencies.
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