So, the wife and I had a busy year (a move, state license changes, car title transfers, a baby, job changes). In the mix we lost track of a bill (flex line of credit to the tune of 15k) for a bit and it’s now gone to collections. My credit score was a mid 700s and while our debt to income ratio was up there, we were doing okay and looking to buy a house in Maryland. Now my FICO score is at a 570 and the wife went back to work to help set our finances straight again.
Submitted by: Matt
While this doesn’t exactly show the amount of money flushed down the drain, it’s definitely a valuable lesson. I’ve mentioned in previous money drain stories about how important it is to keep track of all your money in one place. Whether it’s Mint.com or using Microsoft Money like me, you need to have every financial related account tracked somewhere so that it’s not lost to the wind. It doesn’t take long to do, just spend a day on the weekend and input all of your current accounts and their balances, set up your usual monthly bills/payments, and review it once a week.
As for how to fix this particular mistake, aggressively paying down debt and living as cheaply as possible are really all you can do. Sell junk, plan cheap meals, don’t go out to eat, don’t buy things you don’t absolutely need, etc. Good luck!