overwhelmed, embarrassed, scared
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| Sat, 04-11-2009 - 8:31pm |
Hi,
I need to say first that what I'm not looking for right now is a lecture. I'm beyond depressed and scared over my finances. What am I asking for is help and advice on how to improve my situation.
I make $91k and I have $400 to my name. I don't know why. I don't know what happens. I don't buy frivolous things like jewelry, etc. My only extra expense is buying lunch during work. Other than that, I don't buy anything extra. I did the "write everything you buy/bills down to see where it goes" thing so many times my fingers are sore. It doesn't help. It just tells me that I have enough to save. Yet here I am oweing $2,900 in taxes and I don't have it!
I have $30k equity loan
$11k in one credit card
$2k in another credit card
All have low interest rates (7 and 3 percent)
I pay for all utilities on my own.
Mortgage is $1,460 (tax included) a month.
Childcare through a friend is $150 a week
I split my checks into $1580 for bills and $650 for savings.
Yet every year I have nothing in savings.
I now have a 4 month old son and I'm terrified. I need something to change.
What do I need to do. Who do I need to see to get some help here? I've asked financial planners who just look at me and tell me to save for 8 months worth of my salary. They just don't understand that I know that. I want to achieve it and need help figuring out why it's not happening. WE need to refinance since our mortgage is up in 2010 and I don't know if it's wise for us to roll the equity loan in it and go back up to $1,750 a month.
Any help and pointing in the right direction would help. I am married and my husband makes $30k but all he does is give me 1/2 the mortgage ($700) and that's it.
I know many of you are going to be angry at this and tell me I'm stupid. I obviously am. I just want some help in figuring out what is wrong that I have NOTHING to show for.
Any help is appreciated. I'm desperate. Along with some other personal things (mother dying of cancer, marriage falling apart) I'm back in therapy because a big part of me feels like ever since I got married, I've had nothing but money problems. I was taught to save and have all my life. Then I got married and for some reason, my money is out the door. But then I realize that with my salary and his, I will have to sell the house to give him some money (where are me and my son going to live), probably pay him allimony because I bet he'll ask for it, pay for a lawyer, etc. It feels like I'm just stuck here with no choices that are good.
Sorry to babble here. I'm just fed up and scared and desperate. I don't know who/where to turn to for help.

Hi there piccu9, first, welcome to this board. I will be one of many to reassure you - no one here is going to call you stupid. You're not stupid. You came here for support, and hopefully a solution that works for you.
My first suggestion is try not to think too far ahead. Obviously your marriage is an important part of your life. When things aren't going so great, it adds to the overall negativity you are feeling. But, for now, you're married.
You did list some expenses. If you're comfortable, list everything that you pay out in an average month. we'll try to find some leaks to plug in your budget. For starters, I suggest bringing lunch to work. It may seem like a minimal expense, but it adds up.
You have been going to a doctor you said....co-pays, scripts, those are expensive expenses too that add up quickly.
Is it possible to ask your husband to contribute more money to the family finances?
I hope you stick around. Hang in there. Take it one moment at a time. (((hugs)))
First, hugs to you!
I think you probably know what you can do to improve your savings etc but you are so stressed with your marriage that you spend to comfort yourself.
We all do this but some more than others. You need to like yourself enough to make the hard choices...like cutting back on the lunches and save it instead.
I sincerely hope things get better. Stick around here and you'll be encouraged!
Michelle
First of all your are NOT stupid; we have all been financially scared and at some point or another we have all made financial mistakes. If it makes you feel any better I make $86K and my husband makes $42K and we too struggle financially. Debt is hard. Getting out of debt is harder (in my opinion) and I have been working on it for years (some years are better than others).
All of that aside you can work through this; but work it is.
Identifying where the money goes is the biggest challenge as you say. For me it is eating out and the $30 here and the $50 there.
You mention putting $650 a month into savings but you mention not having any savings at the end of the year - can you tell how this is coming out of savings once you put it in?
The one concrete piece of advice I can give you is DEFINITELY refinance before your terms are up. The upside is that rates are pretty good right now if you qualify.
I am sure others will have better advice but mostly I wanted to say you are not alone.
Take a deep breathe! I am so sorry to hear about your mother.
Just looking at what you wrote, there seems to be two issues here: your marriage and money, and they are sort of related.
You mentioned your husband only gives you $700 a month for the mortgage. Does it contribute to your daycare cost or grocery? I am not sure if you want to go through a divorce when there are other very stressful events in your life, but having gone through one myself, sometimes it is more stressful to stay in a bad relationship. You did not say how old you are, but the average life expectancy for women in the US is 83+. Yes, a divorce can be very expensive, but your time, your sanity, and your life is worth much more than that. I would check with your state law and perhaps even consult with a divorce lawyer regarding money matters. For example, in Texas there is no alimony although they are very sticky about child support. In some states you not only share the asset (your equity in the house), but the debt as well, regardless who incurred it.
Based on your numbers, I cannot really tell how much your net take home per month is. $91,000 a year comes out to be about $7,583 a month. How much is tax, 401K contribution, healthcare account, childcare account, etc.? Find out how much you bring home a month, plus the $700 from your husband, and start listing all you fixed expense: mortgage, childcare, utilities, car (payment and/or insurance, gas, etc). It seems like you have no idea where the money went, other than lunch at work. Perhaps this is the first place to cut back?
Some people here use an envelop system. They do a budget, then put cash in envelops marked for each items (gas, lunch money, grocery, personal care, etc.) and adhere to it. Any left over goes to either savings or as extra payment on credit cards. Personally I do not do that, but stick around and I am sure someone could give you more details on that system.
That's all I can think of for now. And I would like to share with you when I went through divorce 15 years ago, I was very scared. I stayed in the house but had to pay him off, and at the same time the company I worked for was having a round of layoffs (and I was not sure if my job was on the line). It was not easy, but looking back, it was worth it. I got my happiness back. I am not advocating divorce is the solution to all marital problems, what I am saying is don't let financial considerations shackle you to a bad relationship.
Hang in there, and hang around. A lot of people here have good ideas.
Edited 4/11/2009 9:04 pm ET by marie_1229
Edited 4/11/2009 9:08 pm ET by marie_1229
One of the greatest things about being here is that while no one will lecture you, you will get some great advice.
Thank you everyone. This helped.
For some of the questions, my husband can't contribute more. He has his "own" bills such as his own credit cards, Brinks, internet, and cell phone. We do NOT comingle our debt or bank accounts because he is horrible at finances (worse than me) and quite frankly, I pay for enough around here and I don't want the "extra" in savings to go to his credit card. It sounds mean but trust me, he has a long history of paying Peter to pay Paul and I'm in enough hot water with my "own" finances. :)
Ok as said before every two weeks my checks are split:
$1580 towards bills
$650 in savings
So here are the bills that I pay out monthly:
$750 mortgage
$300 equity loan
$323 car loan; but I owe $1,650 on it and I want to pay it off asap.
$50 or more on Amex. Balance: $2,800 another bill I want to pay off asap
$250 on visa. Balance $10,800 it's the only card I use and try to use for emergency only like say a veterninary bill
$114 electric and we're on a budget plan
$67 for gas and that's a budget plan
$67 for landline phone. I think this is high. We hardly use it but I require one for telecommuting at home. 90% of it is due to fees/taxes from the phone company
$50 for water bill
$109 comes out monthly from my check for the train
$25 every 2 weeks for a train ticket to work (corp bus but in the summer I will walk from the train to work)
approx $350 every 2 weeks for groceries. this is the big grocery bill. little stop offs during the week are sometimes $100 on top of this.
$150 a week for child care
$100 every 2 weeks for my son's formula (he has a milk allergy so I can't breast feed)
$25 for birth control pills
$15 for my son's meds every 3 weeks
Approx $100 for pet food
Now for the one time bills:
$500 for labor and delivery bill I need to pay asap (gave birth day after Xmas)
$1,000 for my son's hospital stay (he was sick with RSV for a week)
$2,900 in my taxes but I'm also throwing in $100 towards my husbands. We're going to give each other our returns to pay off the rest of our taxes. So for now I'm throwing in like $200 immediately
My goals are to have a good savings, be able to put $200 a month in an IRA, put some money away each month for my son, and do some light house improvements (interior doors, light landscaping, new water heater, bathroom gutting and replacement ourselves so no labor costs)
OK, thanks for posting your numbers.
Here is what I can see:
total income, including your husband's contribution: $5160 per month
total expenses as they are now(excluding the one time expenses you mentioned): $3975. Leaving $1185 extra per month to go towards the upcoming one time expenses/additional debt repayment.
When you refer to saving twice a month at $650, each time, for a total of $1300 a month. I think it's great that you consider savings a priority, but for the next 6 months, it seems you might be better served putting that money towards expenses?
I would look at your grocery bill-$700 a month is a lot, especially when you add on $400 a month for your baby's formula. It will take a bit of time, but check our your store's sales flyer every week. try to purchase items based on the sales.
If I were you, I would: pay the minimums due on everything. With the $1185 extra in month one, I would pay the $500 towards your first medical bill. Put the balance towards your taxes due. Next month: Put the entire $1185 towards your taxes. Now due on taxes, give or take what the IRS is going to tack on: $1030. Month three: pay off your taxes.
Your car, even just paying the minimum, will be paid off within the next 6 months! That is great! And frees up an add'l $323 per month. Is it necessary to have the train expense AND a car? can you live with one or the other?
OK, so come month four, if it were me (lol), you will have your taxes paid and the $500 medical, leaving the $1000 hospital stay due. the $1185 extra will take care of this.
Now, going into month 5, you have all your one time bills paid, your car is almost paid off, you cut down your grocery bill (hopefully) so now, you have a minimum $1500 extra per month.
I don't mean to simplify anything you are feeling or going through right now. But, your frustrations with your marriage aside, even handing this 90% on your own, you can do it! Can you see that in 6 months time, how things can look a bit better? You will gain confidence and self esteem from these accomplishments. It's strange how when a woman feels these things, other issues in life tend to follow suit.
I would then snowball everything onto the Amex, it will get paid in no time. And then focus all extra funds towards the card with the $10K balance.
Through all this, I would question myself on anything extra, any dollar that was not spent on a NEED. no room for wants. I think you will surprise yourself.
hang in there.
Hello Piccu
I do lecture ask anyone around here but I do it in a nice way. First I have a question. You and husband are filling married joint taxes aren't you. Hey if you are going to be married at least for three more days you should anyway. Oh have you filed already if you have you can always go back and do an amended form. No matter what you end up owing just make sure you file on time.
Welcome! Hugs to you.
First off, nobody here would ever demean you. If someone does - we all would jump them in cyberland and scare them away. :) This is a support board in all senses of the word.
Congrats on your son. Four months old is still very little and you are probably not only suffering from post-baby expenses you didn't expect and exhaustion. Please make sure you are taking care of YOU first and foremost. As a woman who suffered from very severe post partum depression you need to make sure you are taking some time out for yourself.
I don't have a ton of cure all advice but do go online and apply for coupons or free samples of formula. I made all my friends and family members go online and apply for free formula samples and when they got them in the mail they gave them to me. :) Didn't save me a ton of money but every little bit helped.
As for those medical bills - as long as you are making a payment - even if its only $15 a month they can't put you into collections so don't overly stress on those. Most medical bills have no interest either so focus on one of the bills right now that has large interest.
Perhaps you need to tuck $100 a month into savings and use the rest for debt repayment for now. I do think its great to save but right now you would feel more relief in getting rid of some other bills.
Keep posting. Welcome.