Best way to get out of CC debt

[FQLover]

"I still recognize that you did not answer anything about the initial accident itself. Not to stir up memories or whatnot, but if these are from that, why is insurance falling short and if needed, why was legal action not taken to cover the medical bills?"

OP clearly does not want to discuss this aspect of her situation with a group of strangers. Let it go.

 

[DLgal]

"I still recognize that you did not answer anything about the initial accident itself. Not to stir up memories or whatnot, but if these are from that, why is insurance falling short and if needed, why was legal action not taken to cover the medical bills?"

OP clearly does not want to discuss this aspect of her situation with a group of strangers. Let it go.

Sometimes an accident is just an accident. Insurance falls short for a LOT of people. Maybe it was a car accident and it was the daughter's fault and maybe they didn't have adequate coverage for all the medical bills. Maybe because it seems multiple surgeries have been needed, the cost share is simply a huge amount of money. There are plenty of possible factors and the majority of accidents that occur don't qualify to take legal action against anyone. I know a family where the father crashed while riding his bike (no one else was involved and he simply lost control of the bike). He had numerous serious fractures, a head injury, and needed several surgeries. His medical bills after insurance were still astronomical...up past $50k. It happens.

 

[mousehockey37]

"I still recognize that you did not answer anything about the initial accident itself. Not to stir up memories or whatnot, but if these are from that, why is insurance falling short and if needed, why was legal action not taken to cover the medical bills?"

OP clearly does not want to discuss this aspect of her situation with a group of strangers. Let it go.

It would help some, honestly. That's why I asked again in a respectful manner.

 

[Mackenzie Click-Mickelson]

I’m a frequent poster but created a new profile for this question.

My DD was in a horrible accident last year and despite having good insurance, the bills have really piled up. My DH missed 2 months of work while she was in the hospital and I am a SAHM. We have never had credit card debt in our lives but now have about $30k in credit card and medical bills. I can’t go back to work as DD needs a significant amount of rehab. We have cut corners wherever we can but we need to do something to get this debt under control.

I am thinking we should take out a home equity loan. Our house is worth about 750k and we have good credit. DH is considering whether we should cash in some retirement funds (we’ve saved a lot for retirement) but most is qualified $$ so tax ramifications would be terrible. Any suggestions on getting this debt under control? I am constantly losing sleep over this as we’ve never been in this situation. We had a pretty large safety net for emergencies but that has dried up due to alll of her bills.

ETA: Little more info- we have no car payments and have about $550k in equity in our home. We also have quite a bit saved in college funds (about 300k) for our 3 kids and college is about 2 years out for the first one).

OP HERE. Thank you so much for all of your suggestions.

Here's what I have gotten done so far today.

I signed up a for an Amex CC with 0% interest for 15 months and zero charge for balance transfers. I transferred $7000 in CC debt over to that card from my high interest SW card. Thinking we will either open another zero interest card to move more CC debt to (Amex maxes out at $7500 allowed for balance transfers) or we may just start snowballing the one with the high interest rate.

I called the hospital and set up a payment plan for my bills there. They were not able to lower any bills but at least they are now at a manageable monthly amount.

I got the Dave Ramsey book out of the library (normally I would have just ordered it from Amazon, but trying to be frugal here!).

Really appreciate all the suggestions and would love any additional ones anyone has. Gong to look at them more indepthly over the next couple of days. Have a long way to go but at least I feel like I made a dent in it today.

One thing to clarify is that we are not currently contributing to the college funds. Most of that $$ we accumulated when the kids were really young and we had saved a lot even before they were born.

OP here.

DD is actually back at school but is having another surgery next month. She has PT 3 days a week and a multitude of other appointments. I also am the primary caretaker for my elderly dad and my DH works crazy hours and travels quite a bit for work so a part time job is not really feasible at this time.

Thanks for the heads up on the fine print for the balance transfers. I plan to just set up an automatic payment for that card and not make any new charges on it so hopefully that will not become an issue.

Still looking at some other options but I think we are going to cash in some stocks we have to pay off one of my DH’s credit cards and then we will both just have one card each to worry about.

College funds are in accounts that can only be used by the kids without incurring substantial penalties so we are not going to touch those. Looking at some possible options with our retirement funds.

To those that suggested we get rid of some of our luxuries, we have done a lot of that already although I wouldn't say we lived a luxorius lifestyle previously. We live in an expensive part of the country so our house value is considered pretty typical. We cut our own lawn and clean our own house. We are cutting corners right now wherever we can but I’m sure there is always more that can be cut.

Feel like we are making some good progress thanks to all of your suggestions.

I'm guessing part of that sort of comment is coming from what most would consider sizable savings that likely many people don't have when it comes to financial hardships. Also so long as you have equity in your home I don't see the value of the home needing to be told. I think some people see '750K' and they probably think something other than higher COL. We have roughly 100K (in our home equity due to our housing market (though that number is based off of the amount of the mortgage left and the most recent county appraisal that was calculated in Jan). We don't live in a high COL area but rather what is usually deemed a reasonable COL but our housing market is very hot and has been for the last couple of years. But really the value of our home won't matter moreso it's the fact that we could take out a home equity loan if need be.

Several years ago my husband took out a loan from his 401k no penalty but he paid in back in monthly installments taken directly out of his paycheck. I feel like there was a max limit though can't remember.

I wouldn't have thought about cutting your own lawn or cleaning your own house. Were you hiring that out before?

The calling of the hospital for a payment plan is a good one. I probably would have done that as one of my first defenses. When my mom had knee surgery it was over $10k and she immediately worked out a payment plan with the hospital that was quite reasonable.

Not taking vacations is also a good way to reduce costs even if in the short term it sucks. I saw that on another thread you were looking for a summer vacation destination under $3,500 plus you have a vacation it seemed planned for April. May not seem like a lot but it may help to funnel that money towards paying down the medical debt that has you stressed out and without doing anything like opening up CCs, etc. I can understand taking vacation for stress releasing but if you're trying to get debt under control and get rid of medical debt not spending money on vacations (which is usually defined as a luxury) can certainly help.

I hope your daughter continues to get better and the surgeries work out.

 

[Texans_loyal]

Have you asked the hospital to discount your bills? I had a $250K bill AFTER my insurance paid half, I told them there was no way I would be able to afford that. They asked for tax forms and had me fill out paperwork, in the end they took care of the whole bill. They charged me for $150 for water..I swear they would rob you if they could.

 

[katie111]

I still recognize that you did not answer anything about the initial accident itself. Not to stir up memories or whatnot, but if these are from that, why is insurance falling short and if needed, why was legal action not taken to cover the medical bills?

My daughter tried to commit suicide. If I could sue her depression I would, but obviously that is not an option.

Sometimes an accident is just an accident. Insurance falls short for a LOT of people. Maybe it was a car accident and it was the daughter's fault and maybe they didn't have adequate coverage for all the medical bills. Maybe because it seems multiple surgeries have been needed, the cost share is simply a huge amount of money. There are plenty of possible factors and the majority of accidents that occur don't qualify to take legal action against anyone. I know a family where the father crashed while riding his bike (no one else was involved and he simply lost control of the bike). He had numerous serious fractures, a head injury, and needed several surgeries. His medical bills after insurance were still astronomical...up past $50k. It happens.

This. We have good medical insurance but when the bills are in the hundreds of thousands and you have to pay a certain percentage of it, it adds up quickly. We have already paid off a ton of the bills with our savings. A lot of the CC debt came from gas, parking, hotel stays, childcare & camps for our other kids, etc.

I wouldn't have thought about cutting your own lawn or cleaning your own house. Were you hiring that out before?

No, but another poster specifically mentioned that these were the types of "luxury items" we could cut back on so I just wanted to make it clear that these are not things we are spending money on.

Not taking vacations is also a good way to reduce costs even if in the short term it sucks. I saw that on another thread you were looking for a summer vacation destination under $3,500 plus you have a vacation it seemed planned for April. May not seem like a lot but it may help to funnel that money towards paying down the medical debt that has you stressed out and without doing anything like opening up CCs, etc. I can understand taking vacation for stress releasing but if you're trying to get debt under control and get rid of medical debt not spending money on vacations (which is usually defined as a luxury) can certainly help.

These types of comments are why I started this post under a new username but then forgot & logged in on a different computer. We are not taking a vacation in April. That was put on hold because of my daughter's surgery. We are looking instead to take a vacation this summer. My in-laws are paying for it. I think the money would be better spent on bills but after the year of absolute hell we have been through they are insisting we get away as a family.

 

[Mackenzie Click-Mickelson]

No, but another poster specifically mentioned that these were the types of "luxury items" we could cut back on so I just wanted to make it clear that these are not things we are spending money on.

Gotcha I just didn't know where that was coming from.

These types of comments are why I started this post under a new username but then forgot & logged in on a different computer. We are not taking a vacation in April. That was put on hold because of my daughter's surgery. We are looking instead to take a vacation this summer. My in-laws are paying for it. I think the money would be better spent on bills but after the year of absolute hell we have been through they are insisting we get away as a family.

Well to be fair information like that can be important. If you wanted to reduce debt that was causing such stress spending money for something like a vacation may not be the best idea--at the very least it's advice that someone is likely to suggest.

But to also be fair nowhere in your other post did you mention your in-laws were paying for the entire vacation so how am I supposed to know that? You posted you wanted to get ride of the CC and medical debt in the amount of 30K but also posted about taking a vacation in April as well as in the summer. Your vacation post was created 1 week before this post and I fully understand that plans can def. change quickly you also mentioned your daughter's surgery (that would occur in May) in the vacation post.

And yes I did mention about vacation being a stress releaser because it can be so I'm not saying "don't take vacay" at all I'm saying if you're really needing or wanting to get rid of the debt faster (especially with very easy not taking on new CC's, taking out of your 401k) not going for a vacation where you're spending money can help.

You're obviously still free to go on vacation (s) (whether you pay for the whole thing or your in-laws pay for the whole thing). I'm just giving my thoughts on the matter.

 

[katie111]

Well to be fair information like that can be important. If you wanted to reduce debt that was causing such stress spending money for something like a vacation may not be the best idea--at the very least it's advice that someone is likely to suggest.

But to also be fair nowhere in your other post did you mention your in-laws were paying for the entire vacation so how am I supposed to know that? You posted you wanted to get ride of the CC and medical debt in the amount of 30K but also posted about taking a vacation in April as well as in the summer. Your vacation post was created 1 week before this post and I fully understand that plans can def. change quickly you also mentioned your daughter's surgery (that would occur in May) in the vacation post.

And yes I did mention about vacation being a stress releaser because it can be so I'm not saying "don't take vacay" at all I'm saying if you're really needing or wanting to get rid of the debt faster (especially with very easy not taking on new CC's, taking out of your 401k) not going for a vacation where you're spending money can help.

I didn't mention the vacation because we are not paying for any of it. So it is not relevant to this discussion. My in-laws are only giving us this money for vacation. They are not offering us the money to pay bills. To them, that is not an option. So we either go on the vacation, or we don't get the money. And believe me, we need a vacation.

I didn't mention my in-laws paying for the vacation in my other post because once again it wasn't relative to the question I was asking. I was simply asking for some ideas of a reasonably priced vacation destination. It was really nobody's business who was paying for that trip and had nothing to do with the question I was asking.

 

[Mackenzie Click-Mickelson]

I didn't mention the vacation because we are not paying for any of it. So it is not relevant to this discussion. My in-laws are only giving us this money for vacation. They are not offering us the money to pay bills. To them, that is not an option. So we either go on the vacation, or we don't get the money. And believe me, we need a vacation.

I didn't mention my in-laws paying for the vacation in my other post because once again it wasn't relative to the question I was asking. I was simply asking for some ideas of a reasonably priced vacation destination. It was really nobody's business who was paying for that trip and had nothing to do with the question I was asking.

If you're not paying for the vacation at all there shouldn't be any harm in mentioning it. I get creating a new username, I don't even care when someone does that, but if you're not paying for the vacation then it's not becoming a debt to your already existing debt thus no harm no foul.

While none of your situation is actually anyone's business you asked for advice given your current situation and explained that "We have cut corners wherever we can but we need to do something to get this debt under control."

For financial advice, which is what you created this particular thread about, it does matter as far as the type of advice one gives in regards to who is paying. Objectively, not looking at it in a personal manner, you can see how if someone says "I want to get rid of my CC and medical debt" but then also says "I'm taking a vacation" (and up until a week ago it was 2 vacations close together) then not going on the vacation is likely to get brought up from a pure fianancial standpoint especially when who is paying isn't brought up. If you said "in-laws are paying for the summer trip so that's not coming out of our expenses and while we originally had an April trip planned in the last week we decided to postpone that so it's also not coming out of our expenses" or something similar the vacation wouldn't have even been brought up as it doesn't impact your debt that you are trying to get rid of.

I'm sorry that I put two and two together but I still maintain it's a valid comment to make when one is considering financial advice especially given when people talk about reducing overall extra expenses (prior to knowing the in-laws were paying for it).

We, of course, don't have to agree on the matter and it's totally ok. I'm just giving my thoughts.

 

[Southernmiss]

My goodness. The op has been through he## as she says.

The prying in this thread was ridiculous.

There is nothing worse than worrying about a child of yours with medical condition. Debt of only $30,000 in this situation is commendable. The family seems that they were on great footing until the unthinkable happened. Stuff happens.

In this situation, she's trying to pay off her debts, not escape from them. There are so many who would just try to walk away from medical bills today.

Who cares if they charged a few meals, hotels for medical care and parking, or kid activities on the card trying to sustain some sense of normalcy for the family? When your child needs help, you'll move heaven and earth to get them help. You don't have the luxury of time to shop for a cheap hotel or parking, etc. It's often moment to moment quick decisions all while you have a million other worries and cares.


And another thing, Dave Ramsey has never had to face a situation like this. Some of his basic advice is a good starting point, but it's not the end all be all.

Op, I commend you for being strong in taking care of your household, dd and ailing father in essence on your own.

Hugs and prayers to you and your family for brighter days ahead.

 

[TwoMisfits]

My daughter tried to commit suicide. If I could sue her depression I would, but obviously that is not an option.



This. We have good medical insurance but when the bills are in the hundreds of thousands and you have to pay a certain percentage of it, it adds up quickly. We have already paid off a ton of the bills with our savings. A lot of the CC debt came from gas, parking, hotel stays, childcare & camps for our other kids, etc.


No, but another poster specifically mentioned that these were the types of "luxury items" we could cut back on so I just wanted to make it clear that these are not things we are spending money on.



These types of comments are why I started this post under a new username but then forgot & logged in on a different computer. We are not taking a vacation in April. That was put on hold because of my daughter's surgery. We are looking instead to take a vacation this summer. My in-laws are paying for it. I think the money would be better spent on bills but after the year of absolute hell we have been through they are insisting we get away as a family.

Sending hugs your way...sometimes life gives you a really, really sh&tty year or two, and finding some moments of peace and happiness in that sh&tstorm can be priceless. So whatever you decide with the finances, let it bring you a little peace, even if it isn't the "perfect financial advisor" solution...sometimes, the mental aspect of "being done with it" can be just as important as the financial one...

And I wish your whole family a happy and healthier year.

 

[DLgal]

OP, I am very sorry to hear about your daughter's struggles and I empathize, having experienced a major depression as a teenager. I hope she gets the help she needs and you all have better days ahead. Your daughter is still alive and that is all that matters now. The bills will get paid. You're going to be okay.

 

[FQLover]

I add my hugs and prayers, too. Blessings to your whole family and to you ---who are trying to hold everyone together and keep going. May this coming year be a much healthier and happier one for all of you.

 

[Tikitoi]

OP I'm so sorry to hear what your daughter is going through. I hope she gets the help she needs. Hugs for you and your family.

 

[Jen and Ashwin]

Depression is hard. I know from personal experience. You aren't alone and if you want to join us on the debt dumping thread, it is a great group of people that happily give advice and encouragement to each other as we work towards our goals. I wish your daughter and your family all the best.

 

[Hopscotch]

My goodness. The op has been through he## as she says.

The prying in this thread was ridiculous.

There is nothing worse than worrying about a child of yours with medical condition. Debt of only $30,000 in this situation is commendable. The family seems that they were on great footing until the unthinkable happened. Stuff happens.

In this situation, she's trying to pay off her debts, not escape from them. There are so many who would just try to walk away from medical bills today.

Who cares if they charged a few meals, hotels for medical care and parking, or kid activities on the card trying to sustain some sense of normalcy for the family? When your child needs help, you'll move heaven and earth to get them help. You don't have the luxury of time to shop for a cheap hotel or parking, etc. It's often moment to moment quick decisions all while you have a million other worries and cares.


And another thing, Dave Ramsey has never had to face a situation like this. Some of his basic advice is a good starting point, but it's not the end all be all.

Op, I commend you for being strong in taking care of your household, dd and ailing father in essence on your own.

Hugs and prayers to you and your family for brighter days ahead.

Thank you so much for these kind words. You summed up so much of my thoughts. And thank you to everyone else for their support. To those who want to judge...go ahead...but we are doing the best we can for our family.

 

[pigletto]

Hopscotch, as the parent of a daughter who is medicated for mental illness I just want to hug you. So you’re advocating for your dd, and holding your family together, and worrying about debt and taking care of your elderly father and ..and..and...
You are one tough lady. Applause. You’ve got this.

 

[Eeyore2142]

I have no advice that I can offer, but I wanted to offer support. Depression and mental illness is horrible - and the insurance coverage for it is practically non-existent. You are doing what is best for your family and I see nothing wrong with a vacation no matter who pays for it in this circumstance.

 

[Darcy03231]

Hugs to you OP.

Given your financial situation, in the big scheme of things $30k in debt isn't a big deal. I know people who have car loans in excess of that! What's important is taking care of your family's needs. At this point I would say you all need a vacation! I know there are those radical debt people out there that think you shouldn't do anything if you're carrying any debt, but realistically that can be difficult to do. It sounds like you have a plan going forward to take care of it. Don't let anyone get you down.

It goes to show even with good financial planning, something out of the blue can hit any one of us and we could be walking in the OP's shoes.

 

[Texans_loyal]

OP your family is in my prayers. I can't imagine how much strength it has taken to get through this. Go on that vacation and have a hell of a time. Y'all deserve it!