# Looking for help with finances



## incognitoman (Oct 22, 2009)

Let me start by saying that our total gross income is about $50k per year. We have 3 kids and feel like we are always broke.

With that said due to some bad choices we have been forced to pretty much live debt free. We have no credit cards, we have one car, and we rent our house. Our credit is so bad that we couldn't get a credit card if we wanted to (which we don't). We have plenty of accounts in collection however many of those should roll off in the next year or so (7 year limit). Of those accounts in collections many of them are medial bills which we just don't pay. Its not for lack of want but we just don't have the money. We only pay our utilities, food, gas, and rent. We don't have a lot of extra money going out that we could use to pay off the debits and because we just don't, and we have the bad credit anyways I don't see the point of really trying anymore.

Of course this hurts us, we worry about moving because they always want to do a credit check so I feel that we are stuck in a house that is killing us (old house that is big!). We can only do prepaid cell phones, if we move we might have to do a deposit for utilities. This adds a lot of stress. I have looked into some things like Dave Rameses program but since we aren't able to save anything currently, I don't see how this program will help us. I have no way of saving for retirement other than the 5% work takes out of my paycheck and puts into a 401k. College for the kids seems out of the question. I don't ever see this changing.

Just looking for advice or maybe some opinion about something I missed. I know we have handled situations poorly and we have no savings at all. How do we get out of this mess?


----------



## 827Aug (Apr 27, 2008)

I really feel for you. I'm not in much better shape myself. My estranged husband really ruined our credit. Plus I've also got around $220K in medical bills. I wanted to file for bankruptcy but couldn't come up with the money.

You are really better off with out a credit card. The key to managing the medical bills is to send each provider $10 to $25 each month. It keeps them from turning you over to collection--plus you eventually get many of them paid. Is your car paid for? Insurance is also probably running high due to your credit rating. I recently put my truck in my brother's name and that cut my insurance in half. 

Do you and your wife do a budget? That's really a useful tool when money is tight. Sometimes cutting expenses is the only option. It's amazing how much money can be saved by planning trips and making lists. I have been able to cut my gas bill by half simply by organizing the trips into town. Is it possible to have a garden? I have a garden year round and also do freezing and canning. It cuts a grocery bill. 

Your current rental house sounds like a budget problem. Keep looking for something more efficient. There are plenty of unrented places available. Also, ask friends and family if they know of anyone with something available. Even my estranged husband is able to keep nice rental homes. His credit is awful and he even gets into gated communities at the beach. He's usually behind on rent payment too. If people rent to him, there's hope for you.

Does everyone in the family have cell phones? Do you also have a land line? I cut my daughters' cell phone bill in half by switching to Straight Talk. I recently saw Target advertising an even cheaper plan. If I had full cell phone coverage at my house, I would definitely get rid of the land line phone.

Be on the look out for scholarships for the children. Although I prepaid college tuition for all of my children, my oldest ended up with a full four year scholarship. One of my daughters will probably end up with a full scholarship as well.

Above all else have hope. That's what everyone tells me; I've been getting by since 2008.


----------



## PealedBannana (Jun 9, 2011)

I used to work in afmissions for a major college. Trust me, paying for school is the only problem you don't have.

As far as budget, I'm really good with numbers and might be able tp help. Many people don't sre how much they really waste. Ferl free to pm me if you have any questions
_Posted via Mobile Device_


----------



## incognitoman (Oct 22, 2009)

Thanks for the feed back. Our car is paid for and our monthly insurance is about $45 we opted to full coverage because its our only one  We do not have a land line we both have cell phones and share the bill with family so it isn't too much of a burden. Also I car pool to work most days so that helps with the gas bill. Still all these things and it doesn't seem to be changing much. 

Credit is already screwed up so the ones in collections I am not even worrying about for now. Just trying to keep everything else going. The kids always need to go to the doc for something and those just add up. 

Our internet and tv is currently being paid for by family but I want to take that back as soon as possible. I need it for work so going without isn't an option.

Yes we plan to move as soon as we can. The house is killing us but we need to have first, last + sec deposit to move. Not easy to come up with. Because of the size the utilities are high too so I can't wait to move. The rent is high but for the area it isn't bad.


----------



## Mom6547 (Jul 13, 2010)

incognitoman said:


> Thanks for the feed back. Our car is paid for and our monthly insurance is about $45 we opted to full coverage because its our only one  We do not have a land line we both have cell phones and share the bill with family so it isn't too much of a burden. Also I car pool to work most days so that helps with the gas bill. Still all these things and it doesn't seem to be changing much.
> 
> Credit is already screwed up so the ones in collections I am not even worrying about for now. Just trying to keep everything else going. The kids always need to go to the doc for something and those just add up.


No medical insurance?



> Our internet and tv is currently being paid for by family but I want to take that back as soon as possible. I need it for work so going without isn't an option.
> 
> Yes we plan to move as soon as we can. The house is killing us but we need to have first, last + sec deposit to move. Not easy to come up with. Because of the size the utilities are high too so I can't wait to move. The rent is high but for the area it isn't bad.


In the longer term, have you considered school or something to help improve your earning ability? Is your wife working? That is not necessarily going to help if you need to pay for child care...

But $50k GROSS that just is not a lot of money for a family of that size.


----------



## incognitoman (Oct 22, 2009)

Mom6547 said:


> No medical insurance?
> 
> 
> 
> ...



We have medical insurance but it sucks its a CDHP plan so that means we get to pay 100% until deductible is met. Wife is a SAHM. Childcare would kill us.


----------



## dojo (Jul 4, 2011)

This is indeed little money, it's good you have already made a lot of adjustments to solve the problems, that's always a good idea. Is your wife able to work from home on anything? There are some things she can do and it would help you guys with some money. As we speak I am working from home as a web designer and earn a pretty decent buck. She doesn't have to do this, but there are other options too.

Just a google search for "work at home" brought me a lot of possible ideas. Maybe you guys can check it out. Even if she can squeeze in 1-2 hours/day it's already A LOT. Otherwise, you'll have to take on a second job or something like this. 

If you are already doing ALL YOU CAN to cut costs as much as possible, the only way to get off this rut is to INCREASE INCOME. There's no other way. Please keep us posted and best of luck


----------



## greenpearl (Sep 3, 2010)

After you are used to it, you will find living a simple life is very rewarding! 

We want more than we need, we spend more than we need. If you sit down and do a careful math, you don't need much to live! 

Medical bills are unavoidable, for that we can only hope we have good health! 

Rent is set, you usually can't do anything about it unless you move to a cheaper place! 

Utilities are usually set, unless you do a good job controlling how much you use. 

I see there is a big chance at saving money on food, sometimes people eat more meals than they need, they eat more food than they need, actually eating more than you need is not healthy for you, your body stores more calories and gains weight, create more problems for your life. 

Gifts and unnecessary things, I don't know if you buy gifts on every American big holiday or not, it is a big waste of money, in my opinion. 

Calculate how much you need, and stick to what you need.


----------



## turnera (Jan 22, 2010)

There are TONS of websites out there that teach you how to live with less. If your wife is SAHM, entrust her with the job of finding ONE new way each week to cut costs. She should DEFINITELY be using coupons for groceries, for example. And she could be trying out new recipes from basic groceries, to replace prepackaged items. That's a great thing for the kids to be involved in, too. Cooking from scratch is usually MUCH cheaper than packaged food.

Keep a tight spreadsheet on budget. Work it EVERY WEEKEND. Every time you find a savings - spend say, $4 less that week than the week before - that $4 goes into a jar. When you have $25 saved up, pile the kids into the car, and go to your bank and start a savings account. Let the kids see you doing this. Keep saving, a new one each week. Put it into jar. Take money to bank. Rinse and repeat. Before you know it, you'll be talking about real money, lol. Ramsey wants you to have a $1000 savings account for emergencies, so you never have to go into debt to get out of a problem, such as needing a new car; use the savings for that tire, and then work to build it back up to $1000. That is your FIRST priority - that $1000 emergency fund.

Then, once you have that $1000, start putting your new savings into ANOTHER savings account; save up til you have your money to move to a cheaper house.

Also, spend an hour or two each week researching ways to increase your money. It could be selling stuff on ebay, could be finding a barter group in your area, could be your wife watching someone else's kid while she's at home, could be you taking on a paper route for awhile or delivering pizza, get creative. Don't turn your life upside down for it, but DO make a real effort to make changes. You have to have a plan, or you'll end up 5 years later with no changes.


----------



## Mom6547 (Jul 13, 2010)

dojo said:


> This is indeed little money, it's good you have already made a lot of adjustments to solve the problems, that's always a good idea. Is your wife able to work from home on anything?


In home child care perhaps? If done right, this can make good money.



> There are some things she can do and it would help you guys with some money. As we speak I am working from home as a web designer and earn a pretty decent buck. She doesn't have to do this, but there are other options too.
> 
> Just a google search for "work at home" brought me a lot of possible ideas. Maybe you guys can check it out. Even if she can squeeze in 1-2 hours/day it's already A LOT. Otherwise, you'll have to take on a second job or something like this.
> 
> If you are already doing ALL YOU CAN to cut costs as much as possible, the only way to get off this rut is to INCREASE INCOME. There's no other way. Please keep us posted and best of luck


Do beware that if you seek work at home options on google, you are going to also get quite a bit of junk and scams. So search carefully.


----------



## Riverside MFT (Oct 5, 2009)

There have been a lot of great ideas.

Use a Budget - just being aware of what little money you have and where it is going can be helpful
Simplify life - getting a smaller home, shopping at thrift stores
Cut spending

Are friends and family able to help out more? Are you able to rent out a room in your home for a little extra money?

Have you considered getting a different job and/or going back to school?


----------



## maccheese (Jul 25, 2011)

I agree with having a budget. It has been a lifesaver. You will know in advance what bills are to be paid and also if there will be any extra. We are a family of three at about $40K (and part of that is unemployment that can be yanked.) For that size family you may qualify for WIC and Food Stamps (this can help free up some money.) I personally don't mind using United Way 211 to find organizations that will occassionally help pay utilities and rent (if it gets really bad.) Because, I had a large medical bill, some credit cards, and a slew of other bills in collections, I did file bankruptcy (trust me, I will not make the same mistakes and let this happen again). We just would not have been able to pay my debt and my husband's debt while continuing to survive. I found a low cost lawyers on craigslist and used the extra money we had while on food stamps to pay. There are also a lot of firms that do payment plans. Previous posters have mentioned increasing income. I am going back to school myself. Since you all have internet, online classes will allow one, if not both to pursue a degree/certification with minimal childcare costs. I would suggest finding a program with the lowest cost (community college, state school) and not borrow too much in student loans. Check out coupon blogs. There are awesome ways to cut your grocery bill and these blogs make it easy. I have also forfeited mother's day, christmas, and birthday gifts for myself for the last few years. There are also quite a few corporate owned apartments that offer move in specials that don't require first and last months rent. I'm not sure where you live but usually private owners require these as corporate owned apartments are a little more flexible to meet their quotas.


----------



## magnoliagal (Mar 30, 2011)

What you have is an income problem. This board is great but what you need I think some more specified advice and some inspiration.

Try this forum. It's Dave Ramsey yes but it works even if you aren't following that plan. Those people are great and they think of solutions that I could have never dreamed up on my own. 

Sign In - Living Like No One Else


----------



## turnera (Jan 22, 2010)

I agree with the Dave Ramsey forum.


----------



## lostleahnc (Aug 30, 2011)

Here are my thoughts on your current situation. #1, I got myself out of debt by paying down my credit cards in such tiny increments I barely noticed, and at that point in my life I was having troubkt just keeping the lights on. I used a letter, which I would be happy to send you a copy of, I used the same one for every company I owed money to, and it esentially just said, I am not acknowledging that this debt is in fact mine, but I would be willing to pay X on the dollar in return to have this item ERASED completely from my credit report. It took months, it was gruelling, but worth it, I ended up going from a 560 to high 600's and above JUST from doing this and keeping up with my measly $10 per month installments I had set up. It took a long time, but it is going to take you guys time too, and you really cant live without credit, so better get a start on it now. 

Secondly, dont worry about both of you right now. Go to annualcreditreport.com where you are entitled to ONE FREE (completely free) credity report per year for each of you, run both see who's is better, and start with that person as being the credit person, and just pay off yours or her debt until the credit is at least ok. 

YOu may also want to consider dropping collision coverage off the car and keeping comprehensive only. Comprehensive covers fire, theft, glass breakage (windshield) hitting an animal, or other "acts of god" collision is what covers you if you are in an accident and YOU are at fault then collision will pay for the damages, I think comp is more important to have bc it covers the things you cant control. Get a few quotes also, you could save a few bucks a month just by calling around

Have a yard sale, thats always kind of a lame way to raise money, but if you have stuff you need to get rid of, its actually kind of a great feeling getting some money and a cleaner house, the kids will have a good time with it too. 

Has your wife considered taking on caring for another child, like a friend or family member or neighbors while she is home? This could earn extra money. 

Get yourself a prepaid credit card if you can. ANYTHING you can do to build up some kind of credit is good, plus there is no risk if its prepaid, you can only spend what you have. 

crazycouponlady.com and couponmom.com have GREAT coupons they also have a database where they tell you what coupons are coming out in the coming week so you can make your list early. Check the stores in your area, some (actually two major ones) here automatically double coupons up to $1 face value, I save a lot at the grocery store and I am only in a house of two, I guarantee couponing will make a dent. 

And dont avoid the phone when the collectors call, although everyone always wants to, be honest and be firm, they will say they cant help, thats ok, stick to your guns and they always come back to you, they know they dont have the upper hand,. 

I hope this helps, I have been there, with NO help so I know what its like to begin the process of that slow crawl out of debt, for a while it wont feel like you are getting anywhere, STICK IT OUT its so worth it!


----------



## Sameold (Aug 11, 2011)

We have less income and more kids than you, and some pretty spectacular screw-ups as well. Get the Dave Ramsey book Total Money Makeover from your local public library and do what he says as far as spending every penny on paper at the beginning of the month. See exactly where every cent is going to go. Hopefully you and your wife can work together on the finances--it's a lot harder when one of you doesn't want to be bothered.
Food and utilities are likely where you'll have the most wiggle room to cut spending: turn the thermostat down in the winter and wear sweaters, and avoid using ac in the summer. Hang blankets in the winter over the windows--look up any low impact living website and see what sort of green things they recommend for avoiding carbon impact: a lot of them are very good cost cutters. Not using the dryer is worth at least $20 a month. Don't get on the utility companies level pay plans--a lot of people like these, but they leave you with a lot less control over how much you spend when you decrease your usage. Unplug everything, including the microwave, when you aren't actually using it, all those darn clocks use electricity, and do you really need the microwave and VCR clocks? My library checks out kill-a-watts--you might see if yours does and see what's using how much electricity.
As far as food goes, look up vegan cookbooks at the library--the real vegan not the frozen dinner vegan sort of deal. There are lots of wonderful things you can do without meat--we eat meat maybe three times a week--that are kid friendly and much cheaper.
Here's one to start you off: substitute lentils for ground beef in spaghetti sauce. Just boil the dry lentils according to the directions on the package, then add them after you've browned the onions and garlic. Lentils are, right now and here, $.71 a pound dry--which works out to the equivalent of two pounds of ground beef, more or less. There's a book called Diet for a Small Planet, written sometime in the sixties or seventies, I think, which, while I don't particularly like most of the recipes, explains the way to combine various non-meat items to get complete proteins. Your librarian will be able to find it and once you understand what types of foods combine the way you need, you'll know how to change your favorite dishes to eliminate or reduce meat (which is the expensive ingredient) without decreasing nutrition. I am, of course, already assuming you cook from scratch. If not, that alone will make a huge difference in your grocery budget.
Also check your tax withholding at work. Do you get back a big chunk of money that's not EITC at tax time? I don't know for sure, but I'd guess that your federal tax withheld ought to be pretty close to zero.
Most of these ideas are going to require your wife, as the SAHM, to do the majority of the work. I hope she's on board.


----------



## Zzyzx (Aug 24, 2011)

Regarding your debts, you have rights under the Fair Debt Collection Practices Act. For instance, you can make each collector validate the debt and if they can't do that, they must erase the debt off your record.

This site from about.com lists other strategies you can use:
Fair Debt Collection Practices Act Profile - FDCPA Background - Fair Debt Collection Law. There are many links on this page that lead to various actions you can take regarding your debts. Even if they're going to start falling off the seven years, it is never too soon to start working with this in order to get your credit going again.


----------



## UGADawgs79 (Sep 27, 2011)

incognitoman said:


> Let me start by saying that our total gross income is about $50k per year. We have 3 kids and feel like we are always broke.
> 
> With that said due to some bad choices we have been forced to pretty much live debt free. We have no credit cards, we have one car, and we rent our house. Our credit is so bad that we couldn't get a credit card if we wanted to (which we don't). We have plenty of accounts in collection however many of those should roll off in the next year or so (7 year limit). Of those accounts in collections many of them are medial bills which we just don't pay. Its not for lack of want but we just don't have the money. We only pay our utilities, food, gas, and rent. We don't have a lot of extra money going out that we could use to pay off the debits and because we just don't, and we have the bad credit anyways I don't see the point of really trying anymore.
> 
> ...


My professional background is in collections, loss mitigation (mortage modifications, etc) and finance. Have you considered filing bankruptcy? Your credit is already shot and you still have those bills lingering over your head. Why not file chapter 7 (if you qualify) and have those medical and credit card bills wiped out? It would allow you to build up your credit again faster than letting the cards ride out the 7 years. You need to be careful about letting these bills go further and further into collections. They can file suit against you and possibly garnish wages.


----------

