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Story 181 for Stupid Tax
Too Late! Already bought $30K Timeshare
Original story submitted by Mooma
on February 17, 2013
Location:North Carolina
Age: 45-55
Gender: female
on February 17, 2013
Too Late! Already bought $30K Timeshare
Definitely stupid tax worthy! We bought a $30K timeshare on a 10yr, 16.9% loan 6 months ago! Now we know it was a bad decision, but cannot get out of it. We were told we would have no problem refinancing it at a lower interest rate...bank says NO! We don't blame them, who wants to finance something that is not tangible? We talked to 3 different lawyers and the timeshare, all said we're stuck with it and if we default they will bring judgement against us. Now we are attempting to pay off the $10K owed on the car, will roll that payment up to the timeshare and then put all those payments toward the house. When we put these payments on a schedule, it should all be paid for in 8 1/2 years. Are there any other options? Would appreciate hearing from you!
7 of 8 found this story helpful.
4.2 out of 5
rated 4.2 by 9 people
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Story 182 for Stupid Tax
Never forget about auto-renewals
Original story submitted by James
on February 4, 2013
Location:Baltimore, MD
Age: 25-34
Gender: male
on February 4, 2013
Never forget about auto-renewals
In college I loved bookstores with coffee shops. I spent many nights at Barnes and Noble doing homework over a mocha frappacino and often bought new books and occasionally a DVD or CD. When the cashier offered me a membership I figured I spend enough there that I'll save more with the 10% discount than the $25 membership fee. Anyway, the following semester I decided that I would go without the part-time job so that I could focus on my studies (it was my senior year) and survive on the allowance my dad was giving me. I was very good at managing my money, right down to the last penny. I always balanced my checkbook and checked my actual account balances religiously. However, I had totally forgot about barnes and noble. One weekend I checked my balances and it's at -$36. Dazed and confused I immediately go to the bank. This just had to be a mistake.
Well it turns out that I had $14 in my account when the membership auto-renewal kicked in taking my account to -$11 and then I was charged the insufficient funds charge, another $25, on top of that. Not too mention, since it didn't fit my budget anymore, I wasn't even spending anything at barnes and noble, so the 2nd year of membership was totally down the drain. Also, I never looked back at my statements to even see if I spent enough there the first year to where the savings outweighed the membership fee.
57 of 63 found this story helpful.
4.2 out of 5
rated 4.2 by 25 people
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Story 183 for Stupid Tax
I thought we were done paying stupid tax.
Original story submitted by Still learning lessons
on January 31, 2013
Location:Pennsylvania
Age: 45-55
Gender: female
on January 31, 2013
I thought we were done paying stupid tax.
Since finding Dave a few years ago, my husband and I have made great progress in paying down debt, saving, and trying to make good decisions. But even now, we still slip up sometimes and have to pay stupid tax. Two weeks before Christmas we suddenly lost water pressure in our house. My husband, being the handyman that he is, began to look for the most obvious cause - a leak in a pipe someplace in our plumbing. After a few minutes he said he had checked and couldn't find anything, so he came to the hasty conclusion that our well pump had gone bad, and he wanted to replace it immediately. That didn't seem likely to me since it had been replaced only two years ago, but we were tired and stressed and just wanted the water fixed, so I agreed. We quickly went and bought a new well pump for $450, and he (with help from our son) pulled the pump 200 ft. up from beneath the ground and replaced it. He finally got it all back together and back in our well, turned on the water, and...you guessed it...still no water pressure. After a more thorough check of the plumbing when he realized the problem was definitely not the pump, this time he found a small leak in a pipe to an outside water spigot. I quickly called the store where we had purchased the new pump to see if there was any way we could return it since that wasn't the problem, but since it had already been submersed in water we were out of luck. $450 literally down the drain, all because we were in a hurry. I looked at my husband and shook my head and said we just had to pay stupid tax again. Sometimes the solution to a problem is the most obvious one. We definitely should have known better.
24 of 30 found this story helpful.
4.3 out of 5
rated 4.3 by 27 people
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Story 184 for Stupid Tax
Co-signing your money away
Original story submitted by Kara Jane
on January 31, 2013
Age: 25-34
Gender: female
on January 31, 2013
Co-signing your money away
This is a story about avoiding Stupid Tax, thanks to Mr. Ramsey of course.
A few years ago, my best friend came to me and asked if I could co-sign on a new car loan with her. I was still new to Dave at this point but definitely knew where he stood on this issue. I told her that I loved her, but I couldn't do it. I also questioned her choice to buy a new car (gently and lovingly of course) but couldn't sway her.
Thank the Lord I had found Dave Ramsey when I did because otherwise, I might have agreed. I just got a call from her bank (she put me down as a reference) saying they needed to get a hold of her or they would have to proceed with collections. If I had co-signed, I would be liable for that horrible debt and our friendship would be completely ruined.I'm concerned for my friend instead of being upset with her.
Take it from me, fellow Ramsey listeners, don't co-sign for your friends no matter how much you love them.
Thank you so much Dave Ramsey for all you do!
39 of 40 found this story helpful.
4.6 out of 5
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Story 185 for Stupid Tax
We were the Hare, not the Tortoise
Original story submitted by Brad & Susan Bowles
on January 30, 2013
Location:Bloomington, Illinois
Age: 45-55
Gender: female
on January 30, 2013
We were the Hare, not the Tortoise
We were so gazelle intense that we decided in October to place our home on the market and downsize to a smaller home. We didn't heed Dave's advice when it came to real estate (be the tortoise, not the hare!!!). We purchased a less expensive home in Oct, before we sold our more expensive original home. It has been 4 months and not one showing on our original house (due to price range & school district). Also, there is now a lawsuit against the subdivision developer, which now makes our home very unlikely to sell any time soon. We've been carrying 2 mortgages for 4 months. Yesterday we decided to place our new home on the market and place this in God's hands. Our home was listed on MLS tonight and within an hour we had a showing; and a great offer 1 hour later!!! I think we set the record for the quickest real estate sale in Illinois! Amazing what God can do when you turn your problems over to him! But, we do owe the 'stupid tax' - 4 months of double mortgage, interest on a bridge loan for the down payment of the new home, plus the $10,000 for the privacy fence in the new home. What hurts the most is that we were only $3,000 away from being debt free before we started this stupid adventure. (Paid off $80,000 in debt in 2 years) Yes, we were VERY stupid! But we will soon be back on track and debt free very soon! Thank you Dave Ramsey for this great lesson! This is the 'stupid tax' that we will use to help others avoid the pitfalls that we endured! Lesson learned.....be the Tortoise, NOT the hare!!!
27 of 28 found this story helpful.
4.8 out of 5
rated 4.8 by 18 people
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Story 186 for Stupid Tax
No More Student Loans!!
Original story submitted by Kristi
on January 29, 2013
Location:Colorado Springs, CO
Age: 25-34
Gender: female
on January 29, 2013
No More Student Loans!!
My husband and I have made so many bad decisions with our finances. We have been snail intense with our Baby Step 2. This year is the year we have decided that enough is enough. Our debt is keeping us from the call of God in our lives, and until we pay it all off, we can't be free to go on the missions field.
The stupid tax is this: We took out a small student loan for my husband to work toward finishing his bachelor's degree. He did 1 semester, when we decided that God wanted us to go a different way. All semester we were saving in order to pay cash the following semester, and only have the 1 loan. Well, since we decided to go a different direction, the loan entered into the 6 month grace period before we "have" to pay. I know from experience how these things work, and since we had no deisre to pay additional interest on our stupid tax, today we PAID the entire loan, $1800 in full.
All of our current debt is student loans from my bachelor's degree, and by the end of 2013, I plan on coming to Nashville, Dave, to do our debt free scream!
Stupid tax=Student loan. Thanks to Dave's teachings, our stupid tax this time was minimal.
4 of 7 found this story helpful.
2.7 out of 5
rated 2.7 by 10 people
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Story 187 for Stupid Tax
Converted IRAs to Roth IRAs in wrong order!
Original story submitted by Retired Boomer
on January 28, 2013
Location:Spokane, WA
Age: over 55
Gender: male
on January 28, 2013
Converted IRAs to Roth IRAs in wrong order!
I will be paying a "Stupid Tax" because I converted my 5 year younger spouse's IRA to a Roth IRA before I converted my own. My logic at the time was her IRA was smaller than mine, so I could "afford" to convert it first and pay the 25% tax due. I then started converting portions of my traditional IRA to a Roth IRA each year after, but it will take me at least 10 more years to finish converting my remaining IRA balance to a Roth IRA and still maintain a desired max 25% marginal tax rate.
Unfortunately, I will attain age 70.5 in four more years and will then have to additionally take my annual taxable "Required Minimum Distribution" BEFORE I can convert any more of my remaining IRA balance to a Roth IRA each year.
If I had only converted my own IRA balance BEFORE converting any of my younger spouse's IRA, I would have at worst deferred taxes on any RMD for 5 more years. At best, I may have been able to avoid ANY of the RMD distribution taxes by completing all conversions before any RMD requirement kicked in.
11 of 12 found this story helpful.
3.1 out of 5
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Story 188 for Stupid Tax
IRS (I'm Really Stupid)
Original story submitted by Trying To Stay Positive
on January 28, 2013
Location:Waukesha, WI
Age: 35-44
Gender: female
on January 28, 2013
IRS (I'm Really Stupid)
Let's start with the crux of the problem. My husband and I owe, what I feel, is a large sum to the IRS for 2012. We worked so hard to build our snowball. This included refinancing the mortgage at a great rate, to well within 25% of our income, with 15 year fixed interest, saving tens of thousands of dollars by the end of the loan (more if we can pay it off early), and put our "skipped" mortgage payment into the principal. Sounds like a perfect idea, right? We eliminated traditional childcare, and were very savvy about our medical choices. I am fortunate to work at a place where I am paid for overtime, and since business is doing well, have been working as many hours as possible to put toward our snowball. A few things happened: we made a significant amount of additional income, but we reduced and/or eliminated several areas for deductions on our taxes - didn't put pre-tax money into flexible spending for daycare, reduced our flexible medical spending, and eliminated a month worth of mortgage interest. While we put the money we saved into snowball, these were normally deductions that we would take when filing our taxes. When we were trying to figure out what happened, we realized ("duh moment") that with the combined effect of additional income and significantly fewer tax deductions, we had not withheld enough money on our federal taxes, and now we owe ... big. We will be working for the IRS for a while, rather than our snowball, and we were so close to zero debt (less the mortgage) that we could almost touch it. This was REALLY stupid. Pay attention to your changes in your financial plan, and make sure you take into account how they will affect your bottom line come tax time to avoid the same dumb mistake!!
15 of 16 found this story helpful.
3.9 out of 5
rated 3.9 by 11 people
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Story 189 for Stupid Tax
Sallie Mae Co Signer
Original story submitted by Mema59
on January 27, 2013
Age: over 55
Gender: female
on January 27, 2013
Sallie Mae Co Signer
My daughter and her husband asked me to co sign his loan for school. I knew what the Bible said, but did it anyway. I thought well, what can happen, he's going to medical school. Well a divorce later, he is no where to be found. His parents won't tell me where he is at "he has a stressful job". What was $25,000 is now $40,000. He never paid one payment. I tried to find him, no luck. The loan went into default, Sallie Mae made a deal with me. I must pay $167 a mth for the next 23 years. My daughter is now remarried with 4 children, and very little money, so she can't help. I am reaching retirement now, but must continue to pay. I saw his picture and it looks like he is working in a hosipital in London. I can't find him anywhere in US. When I spoke with his mom, she said that she is paying his other $325,000 student loan for medical school and she was not going to add mine. I signed it, I pay it. So learn from my mistake, I was not working at time I signed the papers, but I will be paying for it rest of my life. Now that's stupid tax!!
18 of 18 found this story helpful.
4.9 out of 5
rated 4.9 by 16 people
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Story 190 for Stupid Tax
Flooded by the Stupid Tax!
Original story submitted by Shannon Herring
on January 18, 2013
Location:Louisiana
Age: 35-44
Gender: female
on January 18, 2013
Flooded by the Stupid Tax!
In south Louisiana, flooding is a norm. We were required to have flood insurance partly since our home is a mere 2 inches below the base flood elevation and because of a revamp of the flood maps in our entire parish.
Unbeknownst to me, our mortgage company ONLY requires us to have flood coverage equal to the principle balance of our loan. Originally insured for 187K - our payoff for the mortgage is only 90K. As we griped and complained and sometimes wept over the rate hike over the 9 years we've been in our home, little did we know from our knowledge OR that offered CLEARLY by the mortgage company, we've been paying the Stupid Tax for almost 9 years.
This WILL be remedied prior to our insurance renewals this year!
Our pocketbook was perishing from lack of knowledge....
12 of 20 found this story helpful.
3.2 out of 5
rated 3.2 by 6 people
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