Oprah's Debt Diet, Part 1

Monday and Tuesday, Oprah was showing repeats of the first 2-parts of her 5-part Debt Diet. Wednesday, Thursday, and Friday will be the last 2-parts. I watched them when they were originally on, but it was kind of interesting rewatching it.

If you haven't watched it, the show features 3 financial planners: Jean Chatzky, David Bach, and Glinda Bridgforth. There are 3 families going through the Debt Diet on the show: the Bradley's, the Eggleston's, and the Widlund's.

In part 1, we met the three planners and the three families. Each family makes a pretty decent salary ($102k, $90k, and $75k, respectively) and each carries significant debt (three-figures each). Each family I think represents a typical family where they either buy things they can't afford (the Bradley's have 5 cars when their 2 children aren't old enough to drive yet), try to provide everything to their children (the Widlund's easily give in to their children and pay for their daughter's car, which is newer than either of their cars), and have made some classic mistakes (the Eggleston's didn't decrease their spending when the father quit working to go back to school).

We also learn the first 4 steps in the diet:

1. Figure out exactly how much you owe - pull your credit report; open all old bills that you were afraid to open
2. Track your spending - as I wrote in my post yesterday, you need to see how you spend your money in order to stop the leaks and find extra money to pay off debt
3. Play the credit card game - call each credit card company about lowering the interest rate, pay more than the minimum
4. STOP SPENDING - you can't get out of debt if you keep adding to it

In Part 2, we see that Jean Chatzky moved in with the Bradley's while Glinda Bridgforth worked with the Widlunds (the Eggleston's, working with David Bach, were not on the show). Jean Chatzky spent 12 hours with Lisa Bradley opening piles and piles of unopen bills. Jean worked with them in cutting their spending in many categories in half (such as eating out 3 times a day, going over minutes excessively on cell phone) and had extravagent items returned (replaced expensive leased piano with cheaper paid-for version, returned big screen tv, returned cable boxes to cut cable bill in half). She also put Lisa on an allowance of $20/day, which she did not adhere to the first week.

Then it was on to the Widlund's. Glinda Bridgforth also totaled up all the Widlund's debt. She then went through new rules that the family would follow, such as making the daughter pay for her monthly car payment, not hosting friends at home (making it pot-luck instead), cutting up their debit cards and solely using cash, selling the daughters' extra clothes on ebay, and making their checking account require two signatures to write checks or withdrawl money. After Glinda leaves, the cameras catch the family cheating by buying beer and adding it to the cost of gas, and refusing to sell the daughters' clothes on ebay even though the daughters agreed.

I think the show is great and am glad Oprah decided to do it. People often have a hard time discussing money with others. But if they did, they might find that most of their friends and family who have all this great stuff is in debt in order to have it. The thing that really got to me was when Lisa Bradley said how many of her friends and family have not supported her. I understand sometimes people aren't sure what to say or do, but they're the same people they were before...they're just taking a giant step to get out of debt and keep their family together. They don't expect anything from you other than to be there for them like you would in any other situation. And maybe it'll be good for you to take a look at yourself and your financial situation.

Click here for Oprah's Debt Diet, Part 2 and Oprah's Debt Diet, Part 3.