Author Topic: On the edge: A family fights to keep their home  (Read 12389 times)

yahui168

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On the edge: A family fights to keep their home
« on: August 30, 2013, 11:00:01 AM »
Family doesn't think their spending was excessive, just part of the crowd

http://www.nbcnews.com/business/family-foreclosure-housing-unemployment-8C11036099

Lans Holman

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Re: On the edge: A family fights to keep their home
« Reply #1 on: August 30, 2013, 11:15:26 AM »
So tragic, and so preventable.  There have been some interesting threads on this board about how to communicate the value of frugality to spendy friends, this story is a great example of how bad financial choices don't just hurt your savings balance, they can really ruin your life if things go wrong.  Just imagine if these folks had gotten a good MMM audit/facepunch ten years ago, how much suffering it could have saved them.

Forcus

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Re: On the edge: A family fights to keep their home
« Reply #2 on: August 30, 2013, 01:03:06 PM »
You know, I'd tend to agree with them. Without getting in to the details (not supplied), they sound very much like everyone I know, and myself, before MMM. Most people don't understand how close their balls are to the bandsaw until it actually happens and it doesn't seriously happen to most people, so they continue on, "can't happen to me". Don't know what the solution is..

Joshin

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Re: On the edge: A family fights to keep their home
« Reply #3 on: August 30, 2013, 01:28:14 PM »
These stories irk me because instead of putting a human face on the recession, all they do is give a whole swath of people justification for acting irresponsibility because "it's happening to everyone and out of your control."

Although I doubt the article paints the whole story, I 'm still having trouble mustering sympathy for this couple. Obviously, if he knew a financial planner would say they were a disaster, he knew they were doing things wrong. Instead he decided to listen to his friends instead? Brings to mind the old adage about jumping off bridges. They weren't irresponsible because of ignorance, but because of choice.

Unfortunately, I've known a lot of self-employed types like this. The theory seems to be they can bounce back from anything because they are self-made people, but none of them seem to have "just in case" plans. Many of my compatriots were shocked that we were buying a house and increasing our investments at the height of the recession, when their businesses were crumbling. Well, that's because we had backup plans in place to implement if we lost the majority of our clients. It's called being a responsible business owner.

Also, why did he still have his toys (like the motorcycle) if they couldn't afford health insurance? That just blows my mind. Plus no major medical accident insurance? Either he was running with the lowest coverage or he had no insurance on the bike (correct me if I'm wrong, I'm not privy to the workings of motorcycle insurance).

MrsPete

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Re: On the edge: A family fights to keep their home
« Reply #4 on: August 30, 2013, 01:32:41 PM »
Let's summarize . . .

- 4-bedroom house -- nice house; that looks a bit like the retirement house we're planning, but ours'll be smaller . . . and paid for with cash
- Prime location in a good neighborhood
- Outdoor kitchen
- Gas fire pit
- Swimming pool -- and not a plain little one
- Refinanced the house several times, taking money out for improvements
- Big birthdays for their kids
- Motorcycles for their kids
- Quad bikes for their kids
- Trips out to the dessert to ride
- Mercedes
- RV
- Sounds like the wife didn't work until things turned ugly

The article doesn't mention the couple's age, but if their boys are old enough to ride motorcycles, their children must be teens.  It doesn't say street-legal motorcycles, so they could've been riding off-road.  So I'm assuming years of productive earning . . . and they had half a year's salary saved up. 

Yeah, these folks should've known they were buying into too much luxury for their income bracket. 




Another Reader

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Re: On the edge: A family fights to keep their home
« Reply #5 on: August 30, 2013, 01:42:42 PM »
You can't fix stupid.....

GuitarStv

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Re: On the edge: A family fights to keep their home
« Reply #6 on: August 30, 2013, 02:23:58 PM »
You can't fix stupid.....

QFT


I read the guy's salary . . . then read that his lifetime savings were less than half of his salary.  And that's when I knew where the problem was.

BlueMR2

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Re: On the edge: A family fights to keep their home
« Reply #7 on: August 31, 2013, 06:59:27 AM »
"earned about $160,000 a year and managed to squirrel away $80,000 in savings"

Squirrel away, as if half a year's salary is some enormous accomplishment.  Now, granted, they don't say exactly how many years he was making that $160k, but if it was more than 1 year they certainly could have saved more...   It's an excellent reminder to all of us that it's easy to slip into debt when everything is looking up.  Believing that a downfall could be headed our way is very difficult when times are good, yet that's precisely when we must be saving the most.

Blindsquirrel

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Re: On the edge: A family fights to keep their home
« Reply #8 on: September 02, 2013, 06:40:36 PM »
   Sadly, in many ways he is way better off than most in the USA.

arebelspy

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Re: On the edge: A family fights to keep their home
« Reply #9 on: September 02, 2013, 06:47:59 PM »
They actually weren't THAT bad.

Saved 80k emergency fund.  She was willing to (ad did) go back to work when his business declined.  He applied to 100+ jobs when his business failed.

Were there mistakes?  Absolutely.  But they genuinely tried and did the best with what they knew.  A lack of knowledge is the worst charge I can levy at them, I don't see any foolishness beyond that, and I see no reason to belittle them.

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sleepyguy

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Re: On the edge: A family fights to keep their home
« Reply #10 on: September 03, 2013, 08:04:51 AM »
Everything below... let's get real, they were terrible spenders.  Not that they deserve it but come'on... they were living in lala land and paycheck to paycheck.



“I bought motorcycles for the boys, quads for the boys,” Tim Sadowski said. “We would go out to the desert a lot with me and the family. That was my enjoyment.”

Krichelle Sadowski said they worked hard for their success. “I don’t think it was excessive,” she said.

“A financial analyst probably would have said, ‘You’re irresponsible,’” Tim Sadowski said. “But the friends we were hanging out with are saying, ‘You guys are just part of the crowd.’”

As Tim Sadowski’s business dried up, he applied for more than 100 jobs. In that time, the family blew through their savings, forcing Krichelle Sadowski to work part time job as a lunch aide supervisor at her sons’ school.

The Mercedes and the RV were repossessed, and when the business finally closed, the family lost their health insurance.

sleepyguy

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Re: On the edge: A family fights to keep their home
« Reply #11 on: September 03, 2013, 08:07:36 AM »
Well it doesn't mention their age so maybe that could be forgiven.

You can't fix stupid.....

QFT


I read the guy's salary . . . then read that his lifetime savings were less than half of his salary.  And that's when I knew where the problem was.

avonlea

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Re: On the edge: A family fights to keep their home
« Reply #12 on: September 03, 2013, 08:29:16 AM »
My husband found this Dateline episode on Roku and we watched it last night. 

The way this couple lived before disaster struck is not the saddest part to me.  The tragedy is that they were so determined to hold onto their house, they let it become their top priority. 
For years, they dealt with uncertainty and just kept trying to get break after break from the mortgage company.  Being in limbo that long has got to be draining.  Their kids said that the parents were constantly sad and grouchy. When the family was interviewed after finally giving up on the house, Krichelle seemed pretty happy. I wonder if their marriage would still be intact if they had let go sooner. 

sleepyguy

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Re: On the edge: A family fights to keep their home
« Reply #13 on: September 08, 2013, 09:40:51 AM »
Yeah it's pretty odd... a very underlying thing about MMM users vs typical users

MMM = make more, save more... stuff matters less and less

typical = make more, spend more... stuff matters more and more




My husband found this Dateline episode on Roku and we watched it last night. 

The way this couple lived before disaster struck is not the saddest part to me.  The tragedy is that they were so determined to hold onto their house, they let it become their top priority. 
For years, they dealt with uncertainty and just kept trying to get break after break from the mortgage company.  Being in limbo that long has got to be draining.  Their kids said that the parents were constantly sad and grouchy. When the family was interviewed after finally giving up on the house, Krichelle seemed pretty happy. I wonder if their marriage would still be intact if they had let go sooner.

ender

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Re: On the edge: A family fights to keep their home
« Reply #14 on: September 08, 2013, 10:53:46 AM »
Most people (guys particularly) are too proud to reevaluate their lifestyle when their standing/abilities/finances take a hit.

Downsizing because of external factors means, to many, "I've lost" and no one wants to admit that unless it's the last possible option.


pachnik

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Re: On the edge: A family fights to keep their home
« Reply #15 on: September 08, 2013, 01:24:12 PM »
I read this article and have followed the thread.

I had an experience with downsizing or really downward mobility.  About 10 years ago, I left a very bad relationship.  Anyway, I went from living in an expensive home to renting a small apartment, buying clothes at fairly upscale stores to shopping at the thrift store.  You get the picture.  We didn't have any children, it was just me - so at least I didn't have to drag any kids through this.  Thank God I also had a job.

It was definitely admitting "I've lost" but all I lost really was someone who was not suitable for me and expensive stuff such as international travel.  A very humbling experience when I think back now - all those pretty things were just gone.  At the time, I didn't really have a problem with starting to go to thrift stores or taking my vacations on Vancouver Island which is a short ferry ride away from where I live.  I am grateful that I didn't feel the need to put keep up with my previous lifestyle.

This was just my experience in a 'needing to downsize now' situation - not meant as a comment about the people in the story.  It must be harder when you have children because you don't want them to be affected.  Everybody is different.

« Last Edit: September 08, 2013, 01:50:32 PM by pachnik »

GuitarStv

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Re: On the edge: A family fights to keep their home
« Reply #16 on: September 08, 2013, 02:28:50 PM »
Well it doesn't mention their age so maybe that could be forgiven.

You can't fix stupid.....

QFT


I read the guy's salary . . . then read that his lifetime savings were less than half of his salary.  And that's when I knew where the problem was.

They had two kids old enough to ride dirt bikes . . . I'd be surprised if they were under 30. . .

snshijuptr

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Re: On the edge: A family fights to keep their home
« Reply #17 on: September 08, 2013, 04:04:27 PM »
The way this couple lived before disaster struck is not the saddest part to me.  The tragedy is that they were so determined to hold onto their house, they let it become their top priority. 

From troubled family members (not all are blatantly un-mustachian), I have heard that losing or giving up on their house was the best feeling. It was a chain around their financial neck causing so much stress. I am so so so glad I was in grad school during the recession and didn't buy when my family was pushing it so hard.

NumberJohnny5

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Re: On the edge: A family fights to keep their home
« Reply #18 on: September 08, 2013, 05:31:38 PM »
It's one thing to not get something you never had...but to have something of yours taken away, is generally very difficult.

It's used in sales tactics; giving you the keys to a new car...letting you take it home even...makes it feel like it's yours, and you'll actually start to fight to get to keep it (oh, sorry, you'll need to pony up an extra $1,000...and you will because you don't want to lose "your" car).

For my purposes, I assign ownership to who has a financial claim on the item in question. If you just bought a $20,000 car with $0 down, then I consider that car to be the bank's. If it's a $20,000 car with $10,000 owed, then you and the bank are equal owners. Same with houses; more than once someone would ask about "our" house and I'd reply that it's actually the bank's.

I also get the fact that you wouldn't want to affect the children. You have to consider everything. Not just "Oh no, they'll be devastated if they have to leave their house/school/friends." But also "We can stay for an extra three years, be stressed the whole time which will affect them, eventually lose the house anyways and possibly get divorced." Kids can probably handle a move pretty easily, as long as the family's intact.

Zamboni

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Re: On the edge: A family fights to keep their home
« Reply #19 on: September 08, 2013, 05:33:20 PM »
I haven't seen the whole show but did read the article and I just can't feel sorry for them.  They got lucky with a big income for awhile, in construction which everyone should know is cyclical, and during that time they blew all the money away on toys and fancy stuff like boulders for their pool.  Seriously, money spent on big rocks?  The "we deserve to live like this" vibe is very annoying.

My brother is in construction and he not only survived but thrived during the recession because he was the only one in town who wasn't leveraged to the hilt.

Also, call me a b*tch but once the kids are all in school there's really no reason to be a full time SAHM.  What do you do all day?  Alphabetize the soup cans?  Go ahead and flame me because seriously I just don't get it. 

Hugh H

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Re: On the edge: A family fights to keep their home
« Reply #20 on: September 08, 2013, 06:00:28 PM »


 What do you do all day?  Alphabetize the soup cans?  Go ahead and flame me because seriously I just don't get it.

Interesting, I've never thought of that.

Dee 72013

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Re: On the edge: A family fights to keep their home
« Reply #21 on: September 08, 2013, 07:06:56 PM »
Have to say I felt sorry for the husband.
The wife reminded me of the old Kenny Rogers song, "Lucille"
Seriously, I guess her husband only had value when he was rich.
Now that he's broke and crippled he doesn't deserve her love, respect and loyalty??
The only thing I saw her sad over was losing her ring and her dinning room table set.. pretty pathetic

DocCyane

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Re: On the edge: A family fights to keep their home
« Reply #22 on: September 09, 2013, 07:41:00 PM »
I found the video on YouTube. I must say the story is crushingly sad, but it is difficult to see them make mistake after mistake and keep feeling sorry for them.

The worst part for me is the husband hiding an expensive Harley they could have sold.

And with the seeming years they had to deal with things, couldn't one of them go to school to get qualified for a job?

mariarose

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Re: On the edge: A family fights to keep their home
« Reply #23 on: September 09, 2013, 10:23:17 PM »
Does anyone have a link to the youtube video?

SwordGuy

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Re: On the edge: A family fights to keep their home
« Reply #24 on: September 09, 2013, 10:29:18 PM »
I found the video on YouTube. I must say the story is crushingly sad, but it is difficult to see them make mistake after mistake and keep feeling sorry for them.

The worst part for me is the husband hiding an expensive Harley they could have sold.

And with the seeming years they had to deal with things, couldn't one of them go to school to get qualified for a job?

But if it's everyone else's fault but your own, what possible reason would one change one's behavior?

I don't find their story sad, I find it pathetic.

I would find it sad if they had learned from it and were now doing the right things to fix the mess they got themselves into.  But not those who just won't get it even when hit by a reality clue-by-four...

lentilman

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Re: On the edge: A family fights to keep their home
« Reply #25 on: September 17, 2013, 07:57:35 PM »
Yeah it's pretty odd... a very underlying thing about MMM users vs typical users

MMM = make more, save more... stuff matters less and less

typical = make more, spend more... stuff matters more and more

This is a great observation!  The value of stuff is the true divergence ...