Credit, Debt, Life

Funke Idogun : Nigeria

Sun, 08 Nov 2009 03:40:12 +0000

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$50 of $475 raised.

Started raising funds on Nov 7, 2009

Funke hawks sarongs of various colors and sizes at retail prices to her customers. She is 45 years old and married with five children. She is a hardworking woman and she hopes to lift her family above poverty. The high season for her business is now and she hopes to meet the demands of her customers. She is hoping for a loan of 70,000 naira to purchase more sarongs to sell. She hopes to own a boutique in the future.
She says thanks to all Kiva lenders.

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Funke Idogun : Nigeria

Kanoumafin Group : Mali

Sat, 07 Nov 2009 23:00:13 +0000

$0 of $2,050 raised.

Started raising funds on Nov 7, 2009

The Kanoumafin group is composed of six married women who mainly live in monogamous households, and are on average 52 years old with 4 children. They all live in the Bamanan district of Markala (4th administrative region of Mali), and know each other through neighbourhood relations and their membership in the same traditional women’s association in the area.
The members of Kanoumafin group run businesses selling various items such as cosmetics, pagnes wax (a type of brightly-printed West African cloth), cereals, soap, perfumes, children’s clothing, etc.
After having repaid their four previous loans properly, this group is working on their fifth solidarity (group) loan through Soro Yiriwaso (one of Kiva’s field partners).
The intend to use their loan to buy 5 bags of rice, 3 bags of niebe beans, 10 bags of fonio (a type of grain), 70 pieces of pagnes wax, and a roll of damask (to be dyed before selling). They obtain their supplies of cereals in Koutiala, and their pagnes wax and damask at the grand market in Bamako. The products are sold in cash or on credit at the fairs in Dougabougou, Sibila, Siribala, Boussin, and Diamarabougou to a mixed clientele.
They foresee making an average monthly profit of 53,000 FCFA, which will be used for their business and to buy piece by piece their daughters’ wedding trousseaus.
Their goal is to maintain their collaboration with Soro Yiriwaso in order to increase as much as possible the size of their businesses by saving and obtaining further loans.

Translated from French by Vilas Menon, Kiva Volunteer

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Kanoumafin Group : Mali

Catherine Okutoi : Kenya

Sat, 07 Nov 2009 18:20:14 +0000

$0 of $275 raised.

Started raising funds on Nov 7, 2009

Catherine has been selling secondhand children’s clothes for the last two years and previously sold vegetables in a kiosk. She is 33 years old and married with a young son named William. She is requesting a loan of 20,000 Kenyan shillings to add an assortment of new inventory.

For the future, Catherine hopes to have a stable business so that she is able to provide for her family’s needs along with her husband. She would like to own permanent business premises and become a wholesale supplier. She describes herself as determined, committed, and persistent in her business.

Faulu Kenya aims to empower Kenyans by providing relevant financial solutions. Faulu is a sustainable and profitable microfinance institution that offers savings and credit services to over 225,000 Kenyans. Faulu recently became the first MFI in Kenya to be licensed as a deposit-taking micro-finance company, which will enable Faulu to better serve its clients.

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Catherine Okutoi : Kenya

Namsraijav Tsogttugs : Mongolia

Sat, 07 Nov 2009 15:30:14 +0000

$100 of $1,150 raised.

Started raising funds on Nov 7, 2009

Namsraijav Tsogttugs is 24 years old and lives with her husband and 2-year-old son in Tuv province in central Mongolia. She and her family live in a ger, a traditional Mongolian tent home. Her husband, Enkhbayar, owns a microbus and earns money by transporting people. Tsogttugs operates a grocery trading business at the local market in her town. She started her grocery service in 2008 and has quickly made good progress with her business. Her earnings have enabled her to purchase a refrigerator for her business and a computer for her family. Tsogttugs is very hardworking and is focused on operating an honest business. She says, “I will work hard to pay the bank loan on time and I will use it to grow my business.” She is requesting a loan in the amount of 1,600,000 tugrug (~1120 USD) to purchase a large amount of flour for her grocery trading business.

XacBank was founded in 2001, and listed its first loan on Kiva in January 2009. It is the largest microfinance organization in Mongolia, but also has mainstream commercial operations. XacBank has the vision, scale and innovation to develop and implement new solutions to poverty. It is currently utilizing Kiva’s 0% lending interest rate to return 9% of interest paid from borrowers to them in the form of a savings account at the end of their loans. This not only allows borrowers to gain financially, but also encourages them to save.

To get regular updates from XacBank, please join our lending team.

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Namsraijav Tsogttugs : Mongolia

Comic for November 7, 2009

guestpost — Sat, 07 Nov 2009 07:00:00 +0000

Comic for November 7, 2009 just to make you smile.

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Comic for November 7, 2009

California State Employee is Suffering From Pay Cut Disease. – Martha

Sat, 07 Nov 2009 01:53:31 +0000

“Dear Steve,

Married couple, I am a CA State Employee who had a reduction of pay of approx. $700.00 a month. We have two car payments and a mortguage, in addition we have credit cards debt of approx. $25,000. THe payments of the credit debt is approx 1,4000 a month and seems that we are living paycheck to paycheck and we hate it.

We would like to reduce our credit debt but because of paycut we are only paying minimum payments. I did contact B of A on one of the credit cards and they reduced the finance rate on one card to 7% and they told me that the account will reflect closed by customer. How can we reduce our interest rate and get out of financial debt without any affects on our credit? I hate the situation we are currently in. We need help,

Martha”

Dear Martha,

If you can afford at least your regular monthly credit card payments but want an interest reduction then a debt management plan is the best bet. However, while your credit report won’t reflect you are in a debt management plan, the cards included will be closed by the creditor and that could impact your credit score.

But while the credit report and credit score are important, that’s not the real problem is it? The real problem is that the reduction in pay has left you at the breaking point each month and all it will take is one unexpected expense to throw you under the bus and all your credit will come tumbling down.

You should explore the debt management solution but after looking into it, if the payment seems to high to sustain for a long period of time, come back, let’s talk about other more drastic options.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big hug.

Steve
@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Source: California State Employee is Suffering From Pay Cut Disease. – Martha

Samphors Soung : Cambodia

Fri, 06 Nov 2009 20:50:15 +0000

$425 of $700 raised.

Started raising funds on Nov 6, 2009

Mrs. Samphors Soung, age 28, is a widow with a young son. She lives with her old father in a suburb about 17 kilometers from Phnom Penh.

She has been a garment factory worker since 1998.

Samphors wants to expand her house’s shape so it will be better for her family to live in. She is asking for her first loan of $700 to put additional space on her house.

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Samphors Soung : Cambodia

I’m Getting Married and Discovered She Has a Mountain of Debt. – Sammy

Fri, 06 Nov 2009 20:07:40 +0000

“Dear Steve,

Thank you for providing such a valuable service during these difficult economic times.

I am getting married in the spring of 2010. We have been discussing each other’s finances and unfortunately she will be bringing with her a mountain of debt. She is 50yo, Gross income is $120k, $45k of credit card debt, a condo that is valued at $100k that she owes $145k on, No savings, $60k in retirement adding $0k/yr. I am 47yo, Earn $85k gross, have a condo @ $225k/30yr @ 5.0%, $55k savings, $125k Retirement adding $15k/yr and a 50% Pension. From what I read she earns too much to declare bankruptcy, would it be wise for her to let the bank take her condo and tackling the $45k in credit cards with my savings?

Thx >

Sammy”

Dear Sammy,

Savers attract spenders. It’s the old opposites attract thing.

Purely from a practical point of view I think the best thing to do is tidy this mess up before you are joined in wedded bliss.

It sounds like you are not going to keep her condo anyway after you get married and selling it really isn’t an option. Also, she’s maturing and currently not saving any money towards retirement.

While some others might chastise her for considering bankruptcy, just purely from that practical point of view I mentioned, I don’t think it is entirely unreasonable.

Let’s look at it like this. Let’s say she hands the condo back and then enters a Chapter 13 bankruptcy for the next three years. It would be best to do that now before you are married. At the end of three years she’ll be totally debt free and you’ll have a clean slate to start from. You can help her to be responsible and start saving.

I admit that sometimes I can be a bit cynical but I think if you simply bail her out with your savings you are sending the wrong message. You don’t want to sacrifice your good savings by investing to try to address her bad behavior. Besides, I think a dose of pain will help her to wake up and get back on track.

Let’s not forget that it’s not going to be just $45,000 of credit card debt. The bank is also going to come after her for $50,000 or so for the deficiency from taking the house back. Do you plan on sacrificing more of your savings for that as well?

I think the two of you should find a local bankruptcy attorney you like and go in and discuss this matter together. Then go home, mull it over, and see if it makes sense to the both of you. If you want to make an investment to bail her out, pay for her bankruptcy.

Bottom line, this is her financial cesspool and it should be her responsibility to clean it up without dragging you in. That’s just not fair.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big hug.

Steve
@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Source: I’m Getting Married and Discovered She Has a Mountain of Debt. – Sammy

Any Suggestions for Good Budgeting Tools to Dig Out of Debt? – Scott

Fri, 06 Nov 2009 19:48:04 +0000

“Dear Steve,

My wife and I currently have credit card debt of about $60,000. In addition to that we have 2 mortgages and 1 car payment with about 1 year remaining. We both have incomes, and are barely able to make the minimum payments.

We aren’t behind on any of our debts, but continue to live a lifestyle where we are putting groceries and gas on a credit card and not cutting down to the bare minimum on expenses. We are not friviolously spending money all the time, but probably spend at least 100 bucks a month on stuff we don’t need (daily purchases) and probably about 200-250 bucks a month on monthly things that we feel we need to maintain a certain lifestyle (maid/cable, etc). I am just overwhelmed with our debt number.

I have been a little more worried than my wife has been, and she manages paying the bills. Should we seek credit counseling or debt management before we start falling behind? Any ideas for good budgeting tools to help us look at how much money we waste monthly? I don’t want to file for bankrupcy, but with the amount of debt we have, and no real emergency fund right now, I know that we are just a blink away from having to consider it. We can’t even start a family because of the situation we have put ourselves in.

Scott”

Dear Scott,

It seems like I’m always suggesting bankruptcy, but here is a new one, not in your case.

First, let’s look at what is driving your concern, financial panic. It’s totally normal and natural. But before we wheel out the big legal cannon to deal with your debt, let’s take some baby steps.

Right now you are earning good money but operating in a fog. I seriously doubt you are tracking all your expenses and totally aware where the money is going. The first thing we need in your situation is clarity. And how do we get that? Tracking.

There are a couple of ways to track and budget. They range from traditional approaches like writing down when you spend any money on a pad a paper and what it was for. Or you can use more modern tools like the online service Mvelopes. The best solution is going to be the one that works for both of you. The Mvelopes approach may work better for you if you both have access to the web during the day and can quickly login and enter what you spent.

Simply tracking your cash will cut your spending by about 20%. This is because once you start tracking spending you become more aware what you are spending on and then make decisions to alter your spending habits.

Now tracking the cash can sound like a painful and boring exercise. Personally, I hate doing it but you don’t have to do it for ever if you don’t want to. Just promise me you’ll do it for at least three months.

Now the benefit of the tracking is awareness but it is also clarity. Once you know where you money is going you can then make conscious and educated decisions based on facts about what you might want to cut back or cut out.

This approach works so much better than the traditional budget approach. A budget is a wish list on how you’d like to spend your money and tracking the cash is a measurement of where you actually spend your money.

Try this approach first and build in some immediate savings. Just open a savings account at your local bank and transfer $25 a week into ti. You should be able to easily do this once you start handling your cash with clarity.

After you track the cash for three months, if you are still in trouble, come back and we can talk about the path forward. Does this sound like a reasonable and responsible path forward to you?

Oh yes, to reduce your debt with the most motivation, use the debt snowball approach. Trust me, it works.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big hug.

Steve
@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Source: Any Suggestions for Good Budgeting Tools to Dig Out of Debt? – Scott

Should We Take Money From Our IRA to Buy a Car? – Brenda

Fri, 06 Nov 2009 19:30:59 +0000

“Dear Steve,

Retired – husband 69 and I am 65

Husband worked for a now defunct airline for 28 years so pension is minimal from PBGC. I have an IRA worth about $210K (withdrawing $10K lump sum annually). We are both currently collecting social security. My husband has two part-time jobs and I have one part-time job producing an insignificant income. Our house payment is $1575 per month and we have two aging automobiles…1998 with 186K miles and 2004 with 110K miles. We need to buy another car and wondered if I should take the money from my IRA to buy a used car. We are currently very tight with out monthly expenses and having a car payment would really be confining for us. I know we are looking at approx. 10% taxes if we take the money from the IRA vs. a lower interest rate for monthly payments but it would really be tight to add more debt per month.

Your thoughts please.

Should I take the money from my IRA to purchase a used car knowing I will be paying more in interest than on a conventional car loan???

Brenda”

Dear Brenda,

My gut reaction is don’t do that. Not only will you pay a penalty but you will lose whatever growth that money will make if you leave it in as long as possible.

There are enough good car loans out there right now for you to examine those first. For example, eLoan.com offers used car financing for people with good credit, which it sounds like you have, for 5.69%. If you see what eLoan.com will qualify you for you can then go into the used car dealer, like CarMax and ask them to beat that offer. If they can’t then you’ve got a good deal. They’ve always beat it for me.

I think the goal here is to not set your sights too high for a luxury car. You need reliable transportation. I’d look at a car that was about three years old so you can get the maximum depreciation but still get a relatively new car.

So I took a look on CarMax.com for a car that looks like it would meet your needs. I found a 2006 Mitsubishi Lancer ES with 34,000 miles for $9,849. The monthly payment on that car would be about $188 a month.

I realize that your issue is one of monthly cash flow but do you think that $188 a month is doable for you? If it makes it too tight then consider upping your annual withdrawal to $12,500. The extra money will cover the car payment and you can leave the maximum amount in the IRA to grow.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big hug.

Steve
@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Source: Should We Take Money From Our IRA to Buy a Car? – Brenda

Credit, Debt, Life

Funke Idogun : Nigeria

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