video of former Virginia father in car / gas pump guy 30k in debt
My favorite interview of the day was with a young father who fell into a financial catastrophe and ended up in a better situation because of it. About 4 years ago he lost his job right after the birth of his child. He was living in northern Virginia at the time where a 2 bedroom apartment cost him about $1900/month. In the video he states that you have to earn at least $45,000/year to live in this area. So after trying to make ends meet with odd jobs he finally decided to move to Summerville, South Carolina. Through a family friend he was then able to land a job at a fortune 500 company. Now he can afford health insurance for his child and pay down his debt by $1000 every 2 weeks.
If you watched the video until the end you will hear me ask him if he tried consolidating his debt to a new credit card. He said he hasn’t done that which surprised me since he was obviously quite intelligent. This one step alone could have saved him at least $2500 in interest on his balance of $8000. But like so many other people, this issue is out of site and out of mind. I’m hoping that what I said prompts him to sort through next week’s mail in search of a couple credit card offers. There’s no reason to let the banks skim away money that is better spent on his family. Anyway, it was definitely an honor speaking to such a capable and articulate individual.
The second part of the video features a man who wound up with even more credit card debt than the first ($30,000). After speaking with him a little about how managed to pay this off, he claims that he too did not call his credit card companies to get reduced interest rates. Despite his successful efforts to get out of debt, he probably ended up paying about $8,000 more than he should have. From our vantage point this seems like an obvious mistake that can be easily avoided. But when you don’t know about the simple step of requesting a lower APR, you suffer for lack of knowledge. Anyway, he seems like he is on a good financial track now through the tough lesson he’s learned.