This is a good-news column about conquering debt, brought to you by Courtney and Michael Wacker of Lawrenceville.
Buried in a credit card hole and staring at financial disaster, the Wackers managed to whack about $83,000 in principal and interest in a little over five years.
How they got into the mess — fairly typical — and how they climbed out — determination and good advice — can be an example for consumers facing similar messes.
“We had so many cards full of so much stuff that we started just paying the minimum. That was the big trap,” said Courtney Wacker, a 46-year-old former teacher who works in educational testing.
It wasn’t the house or car payments that got the Wackers in trouble. It wasn’t the two kids. It was the plastic.
“You charge it,” Courtney Wacker said. “It’s the American way. I’m going to pay it off later.” Only “later” didn’t come until after the mountain of debt was about to crush them. As their credit scores kept falling, the interest rates on the nine credit cards shot up to as high as 32 percent. By paying the minimum each month, the Wackers were looking at about 30 years to get out from under the load.
Since they didn’t want to be in their 70s before the cards were paid off and since they were opposed to filing for bankruptcy, the Wackers sought help from CredAbility, the nonprofit group formerly known as the Consumer Credit Counseling Service of Greater Atlanta.
First, the nine cards were cut up. Then, a CredAbility counselor went through their budget, put them on a debt management plan and contacted their creditors. The counselor was able to negotiate a critical change — the interest rate on the debt was cut to 3 percent from 32 percent.
“That’s what saved us,” Courtney Wacker said.
Each month, the Wackers paid a figure they’ll never forget — $1,456, which included a $50 monthly fee to CredAbility.
To hit that monthly target, they had to completely change their spending habits. No impulse buys. No meals out. No vacations, other than driving to see family or friends. No expensive Christmas or birthday gifts. Handmade gifts instead.
“We had to adjust to strictly cash, even to pay for gas and food,” said Michael Wacker, a Georgia Power maintenance specialist. “Once that first year got by, we were OK.”
Did it affect your relationship, which began back in high school?
“You have to be able to work together,” Michael Wacker, 46, said. “You have to be patient with each other.”
They had to establish priorities, which were essentially living expenses, plus one other thing — continuing to pay for the kids’ competitive swimming activities. Everything else was eliminated.
As their debt was being retired, their credit scores steadily rose to 750 from the 500 neighborhood. Now, with all of it paid off, the Wackers still plan all of their spending, and pay with cash. They literally have a written, five-year plan detailing how they’re going to tackle many home-improvement projects they plan to do themselves.
Any advice for others?
“If you can’t pay for it, you can’t get it,” Courtney Wacker said. “If you fall into the credit-card trap, don’t wait long to get help.”
- Henry Unger, The Biz Beat
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