~help I am broke! ~ ! BIG $$ mess here

[peacefulgirl]

Ok, what the heck did I do ???

Me and hubby are feeling some pain ! Time for a budget !

We have a house (got good price), 1 CC, I have 2 personal loans and 1 car payment.

We have GREAT credit and great jobs. We both do 401K's at work. He just opened a roth. We have small IRA's.

But we have no CASH! Not a penny ! No emergency fund! Yikes !

I am getting ready to go to work and I have no gas and not a dime to put some in. I will have to go find some change! This is pathetic!

I have always been the bill payer so it really is my fault here.

So last weekend, we decided a budget is needed and cuts!

We both gave up buying coffee on the way to work. His biggest concern was "darn, no Mary-Lou's, how am I gonna check out the chicks?" LOL too funny ! Really he has been great about this because I really am to blame! He has been on me about it and I keep saying ya ya ya.

Ok anyway, I need to get it together, but I can't seem to get a dime extra to save. Paycheck in - bills out, nothing left.

How do I save if our debt=income??? and that isn't gas,food,oil or any "living" expenses !

Where can I cut? HELP !!!!!!!!!

I am reading MSN.com money and have got some good insite, but do any of you know how I can start this?


I am not into $$, I like to live. And I always help others, so I need a new start here, a new mind frame. I feel like I really want to get this going ... YAY but help me find out where extra cash is coming from.

What bills can I cut out, like get rid of cable TV ? what else? I live average, nothing fancy... food isn't big in my house, we eat to live, so that isn't a big thing . . .

HELP !!!!!!!!!!!!!!!

do ask me ?'s and give me ideas please!


Oh, thinking, instead of doing 10% in my 401K, should I do only the 6% they match, temporaraly and use that 45 bucks to save an emergency fund ??? good idea?

can I really save in car insurance shopping around?

whatdoyouthinnk ?????????

I am used to,if you need anything, I am right there buying it for ya ! now I am like oops !

 

[PrincessDadx2]

Best advice I can give is track your spending - every penny for a month, really 3 months is better. Don't forget things that come only once a year - you need to accrue 1/12 of them. After you see where everything is going then split into two categories 1. needs - food, shelter, insurance, etc. 2. wants - cell phone, cable tv, coffee out, etc.

Once you see where everything is going then it will become obvious where you need to cut. For ex. if you are spending $25 on coffee, but your house is 50% of your income cutting out coffee will not help - you need a cheaper house or a bigger income. If your situation is not critical then people on this board and others can help you with many frugal ideas.

 

[holycow]

Try www.cheapskatemontly.com it is agreat site for people with NO money!

Not sure how I can help but I've found in the past it is the nickle and diming that will drain the cash flow, so I would cut out all the fun stuff for a while...you can check your phone service...do you both have cell phones and a land line?

Don't eat out...stay in etc....good luck!



Holycow

 

[crisi]

Yes, you should consider cutting back your 401k to 6% - but consider that last.

Write down everything you spend money on. If you don't need it don't spend it.

Yes, you can save on your insurance by shopping around. Yes, cable is a luxury and not a necessity. So are cell phones. So are movie rentals or movies out. So is probably most of your food budget. So is really really hot water, heating your house to 70 degrees and leaving your lights on.

If you aren't packing lunch for work - start now.

 

[iNTeNSeBLue98]

I know where you're coming from. If you've got a lot of years before you retire, reduce your contributions to your 401k, maybe even less than 6% for a while.

 

[sweet angel]

It's (as has been said) the miscelleneous expenses that are probably killing you. Make coffee at home and bring it with you. Make your breakfast and/or lunch and bring them to work.

Figure $10 per week ($1 per cup, per person, per weekday) for coffee saved. How many 12 cup pots of coffee can you make for $10? A lot.

Figure at least $5 per person per day for lunch...$25 each/$50 per week. Probably about the same for breakfast.

With just those things, you cold save about $100/week.

There's a bazillion other tips, I'm sure. I'll be watching for them too!

 

[anabelle]

DH and I were in the same boat about 10 years ago. Our problem was that we overbought when we got married. We had just got great jobs so we thought we could spend, spend, spend. We got married, built a house, and bought an SUV, then I got pregnant. We were totally in over our heads. We took a class at church and found out that we should try to pay cash for everything or we shouldn't have it. We sat down and wrote down all our expenses, everything, even the snacks we got in the vending machines everyday.

The first thing we had to do was carpool. It meant I had to wait around for him in the evenings, but we lived in the country about 30 miles from work, so it really saved money.
The second thing is we parked the SUV. We had a clunker that I drove if I had to drive in to work early. The SUV just cost too much in insurance and fuel.. Our insurance agent alotted us 1 day per month to drive it just to be able to keep the 4 wheel drive in good condition.

We packed our lunches and tried not to go out to eat more than once a month. It made it more special. We did not by from vending machines. My fondest memory of those days is when one Monday my husband gave me a 5 dollar bill and said it was for buying one diet coke (my greatest addiction) per day. I cried. Sad isn't it.

We worked on the credit card balances and did not charge anything new.

We did not go on vacations, these were pre-Disney days for sure.

We only contributed 5 % into my 401 K. My DH didn't start his 401 K until after we were out of the hole.

The lessons I learned were do not buy more house than you can afford.
Try to only have one car payment.
Do not use credit cards to buy what you can't afford.
Avoid the mall at all costs.
Shop with a grocery list and stick to it.
Keep every receipt and log in a application like Microsoft Money. This helps you understand your cash flow in a pretty chart.

Hope it helps

 

[imsayin]

Oh, thinking, instead of doing 10% in my 401K, should I do only the 6% they match, temporaraly and use that 45 bucks to save an emergency fund

Is the $45 considering tax implications? Remember, your 401K contributions reduce your taxable income. So if you haven't considered that, you will get less than the $45 due to taxes withheld. I would postpone IRA contributions before I would reduce my 401k contributions. Just make sure you don't go below the 6% - that company match is great free money and you should never miss out on that.

 

[peacefulgirl]

First. I want to say thanks to all of you ! I hope you stay around and walk through this with me! I could use the support.

Some of the things I did wrong, I can see clearer now. I can tell you without a doubt, I just lived. I hated to be a tight wade. I gave $$ away like crazy... shhhhh don't tell hubby that! But if a friend had no $$ for food, I would shop and bring it ova. I love doing that! So I guess if I want to continue, I will have to smarten up!

I hope you all keep giving me ideas. Jump in PLEASE!
I will let you know how I do as I go.

Best advice I can give is track your spending - every penny for a month, really 3 months is better. Don't forget things that come only once a year - you need to accrue 1/12 of them. After you see where everything is going then split into two categories 1. needs - food, shelter, insurance, etc. 2. wants - cell phone, cable tv, coffee out, etc.

Once you see where everything is going then it will become obvious where you need to cut. For ex. if you are spending $25 on coffee, but your house is 50% of your income cutting out coffee will not help - you need a cheaper house or a bigger income. If your situation is not critical then people on this board and others can help you with many frugal ideas.

It's not critical, as in we will not loose the house, we just are in a hole that need to be fixed.

Yes, you can save on your insurance by shopping around. Yes, cable is a luxury and not a necessity. So are cell phones. So are movie rentals or movies out. So is probably most of your food budget. So is really really hot water, heating your house to 70 degrees and leaving your lights on.

Insurance is one thing I need to look at for sure. Better rates?
I do run to websites and sell on ebay, have DSL thru cable, how can I have DSL but not the cable tv? I can get rid of cable for a while but can keep internet access ??? Cells are 2 year contracts and I am on the road at night to work, cant cut there- hubby wants me safe! I get discount for cell and land line utility worker hea! Heat ... can keep lower and lights- already on it!

It's (as has been said) the miscelleneous expenses that are probably killing you. Make coffee at home and bring it with you. Make your breakfast and/or lunch and bring them to work.

Figure $10 per week ($1 per cup, per person, per weekday) for coffee saved. How many 12 cup pots of coffee can you make for $10? A lot.

Figure at least $5 per person per day for lunch...$25 each/$50 per week. Probably about the same for breakfast.

With just those things, you cold save about $100/week.

There's a bazillion other tips, I'm sure. I'll be watching for them too!

We both already make coffee at home and bring it to work. I only bought coffee 1x a day before. I get 2 lbs for 9.99 ! great deal there. I always bring lunch, DD does too, hubby used to do about $3-5, 3x a week. Now he doesn't. So we are good here.

The first thing we had to do was carpool

I work 3rd shift in the city, not an option. But here is my driving .... 45 each way to work. 45 min each way for DD school , then 3 nights of her activites, 10 mins each way. That is the minimum driving for me. These are not being cut, good job, good hours to be home for DD & great school and her activities are not where I will cut expenses.

That said, I drive an old beater car for the school/activities travel, to save on beating up my van with milage. Hubby has an big new DUMP truck (his only luxury, this was paid off with some of the equity) that he drives maybe once a week, he drives his old beater PU otherwise. He could make $$ with the Dump truck, but he works OT that makes him more $. )

We worked on the credit card balances and did not charge anything new.

We did not go on vacations, these were pre-Disney days for sure.

We only contributed 5 % into my 401 K. My DH didn't start his 401 K until after we were out of the hole.

The lessons I learned were do not buy more house than you can afford.
Try to only have one car payment.
Do not use credit cards to buy what you can't afford.
Avoid the mall at all costs.
Shop with a grocery list and stick to it.
Keep every receipt and log in a application like Microsoft Money. This helps you understand your cash flow in a pretty chart.

OK so to sum this all up ....


1. CC's not the problem, but loans are
2. Our vacations are a long weekend every 3 years
3. We don't eat out,go to movies- NEVER, rent videos -hardly ever, hubby spends no $$ really, unless it is for the house and he uses his own saving for that, poor guy
4. I up'd our taxes to claim "0" (highest) for both of us this year, we broke even last year, so I panicked... hmmm should I put it back to "1" ??
5. 401K, looks like $75 matched, $50 not matched. Hubby's would be the same.
6. Wal-mart is a no no for me! I hate shopping lately, hate to go out on my days off, so that is a good thing!
7. only 1 car loan and I make extra payments, but hubby's truck is 14 years old !
8. It's making sense, what did us in isn't the mortgage, but the equity we took, it just took the pressure off temporarily!
9. Hubby works OT as much as he can. I used to add that $$ in as reg income, I never treated it differently, I see now that we were living on it and didn't even know it.
10. I need to figure out more cuts!!!!!!

MY HEAD HURTS !!!!!!!!!

 

[mudnuri]

I tell ya- the post about tracking what you spend is CRUCIAL!!

I thought, oh we dont spend that much in cash/debit/atm YA SURE!!

Track it for 30 days!

Here's what we do to save money. Though we're a bit different than most, we both have fairly long commutes- 1 hour for DH adn 30-45 minutes for me depending on traffic..so we both have new vehicles.(mines a lease, and I'll keep it probably 24-30 months, DH loves his truck so we'll have that for awhile) DH's is a business vehicle- he owns the company, so we only pay the payment on mine out of our account. BUT...this is what we do

We both bring coffee, and eat home lunch/dinners. DD's consider school lunch a treat.

I buy in bulk at Costco- 2-3 times a year, all non-perishable food items. Just went 2 weeks ago- spent 400 bucks, and wont go back until March/April. This includes EVERYTHING in my house thats non-perisable.

I shopped around for our insurance. It's hard for us to do, since DH's motorcycle is the "fastest production bike ever made" so most insurance companies wont write a policy for it. HOWEVER by increasing our deductibles on all of our vehicles, 3 trucks, and 2 bikes in our names, it lowered the payment considerably. Again, I coudnt pick and chose the company, but I could increase these.

The FIRST thing we do with our paychecks- is pay ourselves. It's more important to have a cushion in the bank than it is to have your 401K contributions. If you or DH should be hurt, off the job or on- your income will drop considerably, even with disability insurance. usually its 75-80% of your income.

We have our accountant every year tell us what to claim. Some years, its 2, some its 1, sometimes we file together, sometimes apart. With DH owning his business ,this is tricky.

Right now, if DH was hurt, since he's the primary bread winner, we could live the same way and pay our bills for 6 months with our "cushion"....

One thing- HAVE A GOAL...make it attainable. What is it? "have 1 months expenses in the bank?" Then you attain that, and move it up- "have 3 months expenses in the bank" "pay down the mortgage by $2000 this year"...them move it up- to $4000 etc.. if you dont have a goal, you have nothing to acheive, and your savings habit will go right back to what it was- non-existent.

Also- I know what you mean about loans. My main reason for starting my new job was to pay off 3 of them this winter. DH's motorcycle, my tractor, and my DD's quad. Once this is acheived, we'll only have the mortgage and my truck as "loan debt" My goal, this winter is "decrease our loan debt by 3 and not add any credit card debt"...
Good luck

Brandy

 

[imsayin]

4. I up'd our taxes to claim "0" (highest) for both of us this year, we broke even last year, so I panicked... hmmm should I put it back to "1" ??

This is actually the perfect scenario in terms of income tax withholdings. Receiving a large refund from the IRS is not the best savings plan. The IRS gets to borrow your money all year and doesn't pay you any interest.

Another saving idea is to increase the deductible on your auto and homeowner's insurance. You can save a lot of money.

 

[crisi]

Your hubby sounds like a great guy, but don't discount the stress that financial problems can put on your marriage. If you need another motivator, keep that one in mind.

Don't be sure about "not losing the house." You are in a hole now with two decent jobs, but the problem with being in a financial hole is that if anything happens, the hole will get deeper - and fast. Illness, job loss, a surprise baby can all provide a really big shovel to dig deep. Not only should you learn to live "at" your income (without the OT), you need to work on living below your income for two reasons - 1) provide a cushion if you do have a setback, 2) make the cushion last as long as possible.

Call your cell phone company and see if you can't switch to a cheaper contract. If you use it for being "on the road at night in an emergency" you should have bought the cheapest contract possible. Don't be like a girlfriend - broke and going over on her cell phone by $50 each month!

Call your cable company and see what they can do for your cable/DSL bill. Is your website profitable? Is ebay paying for your cable/DSL? If not, it might be time to pull the plug. Living without broadband in my house would be tough, but we'd do it.

 

[disneysteve]

Originally posted by peacefulgirl
3. We don't eat out,go to movies- NEVER, rent videos -hardly ever, hubby spends no $$ really, unless it is for the house and he uses his own saving for that, poor guy

Can you clarify this? Are you saying your husband has his own savings? If so, is that not some degree of an emergency fund (assuming it is more than a couple of dollars)?

I'd suggest picking up any of several books on this topic by Jean Chatzky. She has written some great, down to earth, easy to follow books about living within your means, getting out of debt, etc. Check you local library (don't buy them, of course ).

 

[fkj2]

I didn't read all the posts closely enough to see if this had already been suggested but you may want to call the CC company, if you've been timely about payments, and ask for a lower rate. Also, if you have student loans and haven't yet consolidated them, check now about doing so since the loan rate is at an historical low. If you've been timely about paying that, you might be able to negotiate a lower rate on those, even if you've already consolidated them. It never hurts to ask.

I just heard the Today show, and Jean Chatzky is out with a new book, entitled "Pay down Debt," or something similar, with suggestions on how to save $10/day.

Also, check the coverage on your older car. You might want to consider just having liability coverage only to cut the cost.

 

[MDMOUSE]

We saved a ton on insurance with USAA- call 1-800-531-8111 to see if you qualify. it is for military and family, but the connection can be remote- it was our grandparents who served. But.. be careful about a high deductible- if something happens a huge deductibe could really hurt if you have a fragile situation. Good luck and best to your friend.

 

[FayeW]

What about consolidating the CC, 2 loans, and car payment into one bigger loan? That will usually reduce the total payment required, and then you could save the extra money in an emergency fund. I am a mortgage broker, and I often recommend this to clients who are trying to save for a downpayment. If you are afraid you won't save the extra money, borrow a little extra and put it into a savings certificate if some sort. It sounds like you pay your bills every month, but aren't real savers. That's ok, as long as you recognize that and are willing to "borrow to save". It may not make sense to some, but we are not savers either, but we always pay our bill. We would not be where we are financially had we not borrowed for our savings initially.

 

[Ozymoe]

<I>Also, check the coverage on your older car. You might want to consider just having liability coverage only to cut the cost.</I>

I second this...it's an easy way to painlessly cut some$$ without much risk.

 

[travelbug]

I know others have discussed the cell phone bill, but have you scrutinized your land line phone bill? Do you have any services that can be dropped, like call waiting, call forwarding, etc.?

How about long distance service? I dropped this entirely from my phone coverage a couple years, saving me a monthly fee right away. Now I only use phone cards for any long distance calls, and I only buy them when they come up on sale for $.03 per minute or less (usually at Target).

Best wishes as you look for more ways to cut expenses and build your emergency fund.

 

[SalandJeff]

That said, I drive an old beater car for the school/activities travel, to save on beating up my van with milage. Hubby has an big new DUMP truck (his only luxury, this was paid off with some of the equity) that he drives maybe once a week, he drives his old beater PU otherwise. He could make $$ with the Dump truck, but he works OT that makes him more $. )

If I'm reading this correctly, you have 4 vehicles. Even though 2 are older, it is still costing you money on insurance to carry the 4 vehicles. Can you get rid of your old car and just use the van - or if the van is too expensive to run for gas, etc. get rid of the van also and get one economical car to replace the two....just a suggestion.

 

[disneysteve]

Originally posted by travelbug
Now I only use phone cards for any long distance calls, and I only buy them when they come up on sale for $.03 per minute or less (usually at Target).

Another option is to switch to a low cost long distance carrier. We only pay $.03/minute with kissld.com.

And I entirely missed the fact that you have 4 vehicles. I would definitely cut back to 2. You'll save on insurance and you'll save on maintenance. Chances are the newer vehicles are probably more fuel efficient so you'll likely save on gas as well.