Broke Down in Tears Last Night

iVillage Member
Registered: 06-02-2003
Broke Down in Tears Last Night
12
Wed, 06-04-2003 - 12:30pm
Yesterday I had to close out our only savings account that actually had any money in it in order to pay my sister back some money she had lent us. When I was at the bank, I was planning on depositing the rest of the savings account into checking to cover what we're overdrawn right now. When I asked her how far overdrawn the account was, my heart sunk into my toes and I thought I was going to be sick. I only had $150 to deposit into the account, and it was overdrawn $340. Mainly because of overdraft fees in the last week. I'm trying so hard to keep our heads above water right now, but I just feel so helpless and like such a horrible wife! My DH used to have good credit, but because of me, it's going downhill fast! He's the only one out of the two of us who has credit worth anything yet.

Anyways, last night I was extremely stressed about the checking account, and the house was a mess (although I checked out the FlyLady website), and dinner turned out horrible. All these things that I'm supposed to be able to handle, and all I do is screw them up! I just broke down sobbing and DH tried to make me feel better. The poor man!

I think we're going to have to go back to cash only also. Use the checking account for bills and use cash for everything else. I also talked to the bank and we're refinancing the house to a lower APR. It will only save us $30-40 a month, but that's $30-40 a month that we didn't have!!! Hopefully with little things like that, we'll be able to stay within our means and start to get ahead.

Leslie

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iVillage Member
Registered: 05-08-2003
Wed, 06-04-2003 - 3:28pm
Hi Leslie, I'm so sorry that last night was so horrible. but look at it this way, you finally realize that things need fixing, so now there's only one way to go, up... right? Right.

I've been reading a financial book and there was a quote in it, of course I can't remember it word for word, but the premise was that debt is not a deep hole, it's a valley... and sure there's a mountain to climb to get out, but step by step will get you to the top and the view will be gorgeous once get there.

hang in there, going to cash only sounds like a good thing to do. As soon as you can manage it I'd go into that bank and cancel that overdraft line too, just another way they keep us dependant on credit... overdraft is just a credit account with checks instead of a card basically.

Keep your chin up, go to cash only, keep a record of your expenditures to see where you can cut, and start climbing :)

iVillage Member
Registered: 06-02-2003
Wed, 06-04-2003 - 5:08pm
Thanks for the words of encouragement. I hope that things do get better for us, but just when we start to see a sliver of light, something always goes wrong. There's always some crisis. We never have enough time to build up any savings for the emergencies. Like my car that hasn't been running for 2 months...we've already put $200 into it in parts (thank god my DH can fix almost anything on a car), plus the part that went out on his truck a week ago that was $90. These little things pop up and we just don't have the money laying around. Which means that we have to use the money that would have been used to pay a bill. And so is the story of our lives. Things don't come in just three's for us. It's constantly one thing after another.

I keep telling myself that things have to get better someday and that someday we'll tell our children how tough things were when we got married and we'll be able to smile about it. Someday.....

Leslie

iVillage Member
Registered: 04-08-2003
Wed, 06-04-2003 - 5:19pm
Ask the bank to waive the overdraft fees.
iVillage Member
Registered: 06-02-2003
Wed, 06-04-2003 - 5:33pm
Hi, Leslie. I'm pretty new here and already I've learned a lot, just from reading the great advice that everyone has. DH and I were talking AGAIN today, and we've decided that the base amount for bills will go into our checking account, and the remainder we'll take out in cash. That will be all the money we have to work with for the month. We will put gas money, grocery money, and probably miscellaneous/entertainment money aside, and I'm hoping that this will be a good visual reminder of how much we can actually spend.

We've been overdrawn too, and I know what you mean about the sinking feeling. I use my phone banking to check the balance, and I hold my breath while I wait for the balance. If I hear that word, "Overdrawn", I just get that sinking, hopeless feeling. Then you know that the next paycheck needs to make up for the negative balance you now have. It makes it really hard to get ahead, or even to stay on track.

I am determined to implement a plan, first to get our bills paid on time, then to add a little to savings and pay down our debt. As much as I know it's a process, I can't help but feel a little impatient. Like now that we're actually figuring things out, it should be a done deal, right? lol. Today we got a call that we bounced a check, and I had to tell myself that soon it should be okay. Maybe not great, but at least okay. DH took the call and didn't even get all crabby like he usually would, I think because we went over all the numbers this afternoon. And even though we agreed it's depressing, we both feel better having made a plan.

Anyway, just wanted you to know that I totally can relate to you, and I think cash has GOT to be the way to go. Maybe not forever, but at least till we trust ourselves to keep better track of things.

Good luck!!

Kara

iVillage Member
Registered: 05-08-2003
Wed, 06-04-2003 - 6:17pm
I know all about sinking money into cars. I'd say that possibly $10,000 of our $40,000 debt was put into vehicles.

We're in a somewhat large city, and once the kids got old enough that we felt we could do without a car we took the plunge and got rid of the cars, they were killing us. That's not an option for alot of people though. Luckily we're able to get DS3 and DD4 whereever we need via transit or cabs, and we rent cars now for occasional weekends.

It's all about making a plan, and sticking to it. There's alot of sacrifice involved too, if you had asked DH a year earlier if he'd ever go without a vehicle he would have laughed at you, but things have changed. In order to cut up all our credit cards and close our line of credit we spent an entire year analyzing our expenses, cutting here and there, and by the year end (Dec. 2002) we had cut about $1000/month off our living expenses. Our debt did not change in that year, but at least it did not go up. We still had to rely on a card now and then to fund an unplanned expense.

There is a book you desperately need to get. Mary Hunt's Debt Proof Living book. Borrow it from your library or buy it if you have to. It is a lifesaver. I've read a ton of financial books and hers was by far the best at teaching us how to stop depending on credit.

It will teach you how to analyze your spending, spot problem areas or areas where you can cut. You will learn how to save for upcoming emergencies (car repairs!) and save for expenses that aren't regular. You will learn how to stop using credit, you will learn to find all sorts of ways in your life to increase your cash inflow and decrease your cash outflow. It is so full of incredible advise and information, it causes alot of lightbulb moments. I also use a free computer program that I got at www.debtanalyzer.com . It's called Debt Relief (there's two of them there, only one is free). You enter your debt balances info and can play with a bunch of payoff scenarios.

Like I said, we went from being $1000 in the hole every month to finally starting to pay down our debt, we pay $620 per month towards it now. We also have a bank account where we put cash to fund yearly bills like insurance and quarterly bills and christmas gifts, dental deductibles, prescription co-pay, you name it, we've got a fund for it now, something unheard of before. We don't even own a credit card now, other than one locked away with an eensy limit that we use to reserve our rental cars, we cancelled all the other ones and can't use them. We're only 5 months into the official paydown plan. It could take us 6 years and alot of interest if I don't increase my income (SAHM right now). It's scary but at least I know dates and figures now, and not only will we be able to tell our kids about the lean times and laugh one day, we'll be able to teach them how to do it right too! Knowing those dates and figures is an incentive to make it happen faster too.

Get the book, really, right now, run, go find it. :)

iVillage Member
Registered: 06-02-2003
Thu, 06-05-2003 - 10:59am
Unfortunately, our balance in our checking account has been an ongoing problem over the last couple of years and there is no way that they will even consider waiving the fees. I'm considering moving all of our checking and savings accounts over to a different bank that has online banking. Our current bank has a phone number to call for information and transfers, but the balances are always for the day prior, and the transfers don't take effect until the next day. It doesn't do me a lot of good.

One thing that I've found has helped me is automatic payments on our loans. I just make sure the correct amount is direct deposited into the savings account from my paycheck, and the payment is automatically taken out on the due date. I'm horrible for letting a due date pass by and accidentally using the cash I had set aside for the payment for other things. I'm trying to catch up on past due payments for one of my loans, and they won't let me set up automatic payments until the loan payments have been on time for two months. Hmmmm...doesn't make much sense to me.

I ordered Mary Hunt's book - Debt Proof Living off Amazon.com. I even made sure that I ordered one from the new/used section for about $5 less than it would be for a brand new book. I am determined to get things in our lives back on track if it's the last thing I do!!!!!

iVillage Member
Registered: 04-19-2003
Thu, 06-05-2003 - 3:56pm
Hi just wanted to caution you or warn you about opening new accounts. Make sure you are able to open them first before closing the old ones. I worked in a bank and they routinely do credit checks on you *before* they open an account up. Bad ratings - no account - simple as that. They are not going to want your business because you would be considered high risk.

I have to say as well, not only to you but to others that have posted I do not understand how you can spend money earmarked for another bill. Do you not have a check book register? I always keep it up to date and I go by that balance - not that bank - that way I cannot spend what has not gone through. I don't mean to sound harsh but I have a hard time with that excuse for not paying bills. We all struggle and I know people can get behind because more money is going out than coming in but I do not understand spending money you have for bills on something else just because its in the bank. As soon as I get or dh gets paid I sit down with the check book register and write the deposit in and all the bills I need to pay with that money regardless of when they are coming out. If this is too hard for you than you really need to look at why you need to spend. What's missing that you need to buy in order fill up? These are things you need to ask yourself (I don't expect you to answer me)

Somtimes I think we need a swift kick in the butt (myself included) to wake up. You are an adult start keeping track of your balance yourself. So what if your bank gives you the previous day balance? Have you spent so much today that you cannot subtract yourself? And you have no money but you bought a book! You could have gotten it for free at the library! I am risking saying all of this because I care about everyone here but I think this needed to be said.

Sandra

iVillage Member
Registered: 06-02-2003
Thu, 06-05-2003 - 4:43pm
I'm checking with the bank tonight to see if we can open new accounts with them. The reason money gets spent that should be set aside for bills is because we never have time to get money set aside for our "emergency" fund. So when a doctor's appointment comes up, we spend money for the copay, money for the prescription, etc. And when car repairs come up, like they have been we've had to come up with $100 within the week to purchase parts. Our budget is very tight, and usually $100 isn't available to just pull from somewhere, as with a lot of people here. So, a week goes by and between gas, grocery money, whatever repairs or odd things we have to pick up during the week, and the loan payments that have to be made, we end up actually borrowing money from the following week's check. Maybe we're living beyond our means, but right now we don't really have any other options. We only have one running vehicle, so for one of us to work a part-time job is extremely difficult. It's not that I spend the money just because it's in the bank, but the repairs or emergencies that come up tend to suck the money from our account every week.

I bought the book because I plan on using it for a very long time to come. I spent $5.00 on a book that will be read over and over and over again. I was extremely proud that I found the book for half price on Amazon and saved $5.00. I know you're trying to be helpful, but I've actually been feeling good about things and the changes I'm making to get things back on track.

Leslie

iVillage Member
Registered: 03-26-2003
Thu, 06-05-2003 - 5:02pm
I can't speak for everyone, but for me I have to admit I am terrible with checkbook management. There I have admitted it! I know it's wrong and I should make the time to do my budget right and this is something I need to work on.

I don't think you sounded harsh, just "real"! What works better for me is paying most bills by drafts from our savings. I am allowed 2 per savings account everyday and they are free so I save some $$ on buying checks because I write fewer. I am able to pay 4 utility bills in person with cash, so I do that. For me, writing fewer checks helps me.

I think another problem that arises is that people don't have savings/emergency funds. Although, how are you suppose to build a savings when you can't pay your bills. It all seems like a vicisous cycle, but I am determined to get out of it.

I thank you for my "kick in the butt" today. I need them often. I'm heading home to go make dinner rather than order that pizza I was just thinking about buying. LOL

iVillage Member
Registered: 04-19-2003
Thu, 06-05-2003 - 5:15pm
Leslie,

Believe me I am in your corner. I have over spent too (or I wouldn't be here) but the point I was trying to make is to really look at your needs vs your wants (yes doctor bills are needs- in my books) but you made the comment that your checking account has been this way for a couple of years. I find it hard to believe you have something come up *every* week/month where you *need* to spend the money today that was meant for a another bill.

You said: Maybe living beyond your means? You don't know? And you do have options: Spend less money or Make more money. I am glad you are getting Mary's book (and that you got it at a discount) but I was trying to point out your spending. EVERY PENNY COUNTS. I cannot stress that enough and it sounds like you could use every penny. Every time you go to make a purchase really think about it. Do you have the money? Even groceries - do you *need* everything in your cart? I, myself, still struggle at times *NOT* to buy what I don't need so I am talking from personal experience (although I have always paid my bills).

I am not trying to make you feel bad. I think it is great that you are taking steps to work on a spending plan and save money but I also think "support" is not always about a friendly pat on the back (those are good :) but that sometimes we need *tough* love and I am only saying this because I really care.

I hope everything works out and I am routing for you all the way.

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