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Story 181 for Stupid Tax
Started a Business
Original story submitted by Bella
on June 12, 2012
Location:Franklin, TN
Age: 45-55
Gender: female
on June 12, 2012
Started a Business
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In the thick of it - getting on board with Dave Ramsey
In the thick of it - getting on board with Dave Ramsey
We have the saying posted everywhere! "Live like no one else so you can live like no one else." And we are driven to become debt free. After job loss and being diagnosed with breast cancer, and job loss, we finally landed here in TN.
We faced loosing our retirement home we built in GA. Left it with renters and came here to work. Well, once our church got us hooked up with Dave, we saw some light at the end of the tunnel. Brought our four walls in and began to save and reduce our debt. So we thought.
Our big TAX mistake, because we DID end up letting the house go was the fact of not having a big deduction on our taxes as we always had and we had started a painting business (LLC) but were sticking to the theory of giving Uncle Sam minimul, keeping as much in the immediate pile to live day to day. Come tax time, it blew up. The look on my face when the CPA told us we owed 7k and then over 4k to them for figuring it all out, about sent me out of remission. We now have two more debts to pay off cause the emergency fund wasn't big enough at the time and money doesn't grow on trees.
Lesson learned - although on the personal tax side, we want to have as much as we can in our immediate basket - business wise - it is NOT the same, especially here in TN. We should have done more homework. We know now. We would never blame Dave for that advise, just kick ourselves in the butts for NOT doing the homework as Dave tells us over and over again in his series. We are moving on and working to be debt free still. P.S., I am still in remission too! Brenda
10 of 12 found this story helpful.
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Story 182 for Stupid Tax
Never cosign another's loan, never!
Original story submitted by Conchita
on June 2, 2012
Location:NE Colorado
Age: 45-55
Gender: female
on June 2, 2012
Never cosign another's loan, never!
An extended member of the family desperately wanted to go back to school, as a father of 5 he needed a better career. We stupidly cosigned his student loans for a year of college, thinking it would be less than $10K for a year, right? He even lived with us rent free for a year while his family lived in another state. Later we discover he had asked for money to support his family for a whole year. Total borrowed that we cosigned for, over $32K! Gulp. Three years later we find out he never made a payment on the loans, kept deferring them, interest accumulating, and suddenly we are being asked to pay almost $43K for his student loans. Talk about stupid tax! He was injured right about that time, unable to work and now we are out over $300 a month and have paid on the bills for 4+ years and now are down to owing $38K. I'll be on social security and still paying on his loans many years from now! Never cosign a loan for anyone!!!
67 of 70 found this story helpful.
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Story 183 for Stupid Tax
Make sure your college is accredited!
Original story submitted by Lori
on June 1, 2012
Location:Houston
Age: 45-55
Gender: female
on June 1, 2012
Make sure your college is accredited!
I am a college professor, and see students going deeply in debt all the time. I would like to offer a story of one of my former students.
This student, a self-supporting adult female, about age 50, decided to "better" herself, and obtain a degree as a "certified" medical assistant from a for profit school. Before starting school this woman was debt free, not owing a car (she walked to work). While not rich, she did everything she was supposed to do, by living within her means. The college recruiters seduced her with the promise of a better paying job and work environment. Making it easy for her to obtain her "financial-aid", which was NOT a grant, is just one of the "services' they offered. At the start of every semester she was given her loan money on a "debit" card, which every time she used it cost her an additional $5.00. You see many low income folks don't have bank accounts, so opt for the the "debit" cards in place of direct bank deposit. Yes, she was charged interest on her loan AND a fee for every time she used her debit card! To make a long story short, the school (non-accredited) closed 1 semester short of her proposed graduation. Because the school is non accredited, her credits will not transfer, so she left with no marketable degree, having to start her education over. Oh, and yes, she is now $25,000 in debt, not counting the car she bought. I met her when she took my class at an accredited college. I realy do admire her, she's still trying her college degree, working full-time to pay off the debt and by paying cash for her new degree.
Moral of the story, if you go to college, make sure it is accredited (research the accreditation online). Do not consider a college if the school is not accredited!
31 of 31 found this story helpful.
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Story 184 for Stupid Tax
10-15k Over the Price of the Car
Original story submitted by Maigahane
on May 30, 2012
Location:Nebraska
Age: 25-34
Gender: female
on May 30, 2012
10-15k Over the Price of the Car
This is just one of the stupid taxes my husband and I have paid. 5 years ago my husband's 12 year old car with around 175k miles died to the point it wasn't worth fixing (it needed a couple thousand dollars worth of work to just get it running). He had driven it from age 16 to 22 and I knew that with his next car he would drive it until it died of old age too so I agreed to let him buy the car he wanted brand new. I'm still okay with that part of the decision since 5 years later he's still planning on driving it for at least another 5 years (as long as it holds up).
However, being young, naive, and just plain stupid we let ourselves get majorly conned at the dealership. I think even before the interest we paid nearly 10k over the base price of the car for "warrantees" and prepaying oil changes for 75k miles and other stupid stuff like that. I don't think we still have the original paperwork but when we refinanced 6 months later (after making double payments for a couple of those months) we still had to get a loan for 4-5k over the base price.
IN ADDITION we got a 6 year loan at a ridiculous interst rate given our good credit scores (something like 8.5% in late 2007). When we refi'd 6 months later we dropped to a more reasonable 6.25% but STILL did another 6 year loan since we decided we also needed to buy a house and wanted a lower monthly car payment so we could get approved for a mortgage...
We're within a couple of months of paying this off, almost exactly 5 years after buying the car, cutting off 1.5 years from our current loan by throwing money at it over the last year. I can't wait to add that $500/month to our debt snowball. Between paying close to 10k too much for the car and over 5k in interest we paid WAY too much for his car.
27 of 28 found this story helpful.
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Story 185 for Stupid Tax
Starbucks Stupid!
Original story submitted by Andrae
on May 30, 2012
Location:Okinawa, Japan
Age: 35-44
Gender: female
on May 30, 2012
Starbucks Stupid!
After moving and getting a new job, I started spending frivolously... I thought I was 'staying within my means'.
$576 in one month on eating out - and Starbucks every day.
I'm kicking myself!
16 of 25 found this story helpful.
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Story 186 for Stupid Tax
$100k Diploma..very stupid
Original story submitted by Captain Stupid
on May 29, 2012
Age: 25-34
Gender: male
on May 29, 2012
$100k Diploma..very stupid
I finished my undergrad debt free as I was very fortunate enough to have parents that saved money all my life to send me to school. As I approached the end of my undergrad I was encouraged by my parents, coaches and professors to go to grad school even though I never wanted to. So I applied to 2 that I didn't think I'd ever get into just to say that I tried.
Well that totally backfired and I got into one of them, which happened to be an Ivy League school (top 10 in the country in Engineering). Now everyone said I had to go, I can't pass up this opportunity. So, like an idiot, I went.
In 2 years I not only earned a Masters degree in engineering, but also over $100k in student loan debt (Ivy League schools are expensive!). Then I graduated during one of the worst recessions in since the Great Depression and couldn't find a job for 3 months. I applied for over 60 jobs and only heard back from 3 companies. So I had to defer my loans because I had zero money and was living at home.
I finally found a decent job but I'm paying the minimum on the loans and I'm still shelling out $700 a month. Add in rent, truck payment, bills, etc and there's hardly anything left at the end of the month to save/make extra payments.
Grad school wasn't even close to being worth what I paid. Everyone keeps saying school will pay off...but I don't think so.
26 of 28 found this story helpful.
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Story 187 for Stupid Tax
emotional buying...
Original story submitted by Cyndi
on May 28, 2012
Location:Springfield
Age: 45-55
Gender: female
on May 28, 2012
emotional buying...
My husband is from New Zealand and goes back to see family yearly. My career doesn't allow me to go along...so out of resentment I purchased a new car. If he gets to go to New Zealand = I get a car. VERY STUPID and I even knew better at the time MORE STUPID. Emotions got the best of me...the car is paid but the stupid tax prevails.
8 of 8 found this story helpful.
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Story 188 for Stupid Tax
Lesson Learned!!
Original story submitted by Elouise
on May 27, 2012
Location:Chicago, IL
Age: 18-24
Gender: female
on May 27, 2012
Lesson Learned!!
My stupid tax was miniscule compared to most- here's how it goes: I bought an item from Target but needed to exchange it. Went to return the item, but forgot my receipt. I got some store credit, but it was $2 short due to my lack of receipt. Later that week, I found the original receipt, so I went back to get my $2 back!! Well, for whatever reason, they wouldn't give me the difference. Stupid stupid stupid. Leaving the store grumbling, I considered complaining to management, but then I realized this was MY stupid tax. $2 is next to nothing, but it was the principle that really got me. Lesson learned: BRING YOUR RECEIPTS THE FIRST TIME AROUND.
5 of 9 found this story helpful.
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Story 189 for Stupid Tax
Do the math first
Original story submitted by Patty
on May 24, 2012
Location:Idaho
Age: over 55
Gender: female
on May 24, 2012
Do the math first
As a young new single mother, I was given the opportunity to buy life insurance for my new baby at a mere $20 per month. The policy would provide $1000 upon her death. I did not do the math. Twenty years later the policy was paid in full. I did the math then and realized I had paid $5000 for the $1000 policy. Last year I cashed out the policy because she is married and did not want the policy. I received $250 on my #5000 policy.
26 of 27 found this story helpful.
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Story 190 for Stupid Tax
Consequences of not listening to my spouse
Original story submitted by Bigfoot
on May 23, 2012
Location:Pocatello, ID
Age: 35-44
Gender: male
on May 23, 2012
Consequences of not listening to my spouse
Please read story - it's a series of life lessons better not learned the hard way.
Not long ago, I graduated from physical therapy school and decided that "I'm making more money, I deserve a better/bigger house". I had convinced myself that the neighborhood we lived in was too loud, or that I always wanted a real garage and the house didn't have one.
So I searched and found a beautiful house in the woods. The price was much more than our current house, but it was affordable. My wife didn't like the house and suggested it was a poor financial decision. Well, I felt I deserved this reward and I went so far as to tell my wife I would leave her if she didn't let me have it. I promised to renovate the house into something she would like.
So we bought it, and I began renovations. I had some money set aside, but due to many unexpected cost, I ended up borrowing from the bank and both sets of our parents just to make it liveable. So now I owe family money - which has changed family dynamics, I have a $700+ per month bank loan, and I still don't have a garage as I closed it in during the renovation. Now we are in a position where we are trying to move to new town. Sure the house will sell, but we will still be paying everyone back 10s of thousands.
I haven't had time or money to go or do anything for 4 year. I ended up taking a job I hated and couldn't leave because I needed more money. Due to (unnecessary) financial and job stress, I nearly destroyed my relationship with my wife.
Had I listened to my wife I would have been debt free besides the home, and had all the time and money to travel. Perhaps I would have had the freedom to look at other investment opportunities - the one's that require cash.
I hope this story can help at least one person out there. It's not worth buying the Cadillac house, the Cadillac car, or the Cadillac lifestyle if A) It effects your relationships, and B) it cost you your financial freedom. I would rather live in a card board box - ya its that important.
41 of 41 found this story helpful.
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