Mortgage: Monthly payment $1691
This is ridiculously high for this amount of principa (depending on how ling youve lived there)l. I'd start calling to refi, but it may be difficult given your job situation.
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Daycare: $1020,
Without a job, do you still need monthly daycare? 40% of your partners income is going to daycare.
Home alarm and phone line (bundled with internet): $85
Call about a cheaper rate. We currently have 3mb/s Internet through Comcast for $40/month. It's screaming fast compared to what we previously had.
Cell phones: $145
Cell phone and a land line? We're on America's most expensive network, with two data plans and pay less than this per month. Call and ask about unadvertised rates with fewer minutes. If you have a landline, you probably don't need many cell minutes. Any smartphone has free texting apps. Paying for texting is something you can't afford right now - so is data, but you may be locked into a contract.
Car insurance: $80
Is this for one car or two? If its for one, you should be able to get it down to <$60/month. If its for two, get rid of a car.
Groceries: $400
For two, we spend between $220-$300/month eating mostly organic. Shop for deals, eat in season, buy staples and cook.
Netflix: $8
We can afford it, and we don't spend $8 on Netflix. Hulu is free, redbox is likely cheaper.
Some of the above advice might seem tough, but you should be in survival mode right now. Between mortgage and daycare, all of your income is being spent. On top of that, your spending on luxuries that many of us with higher joint incomes would consider frivolous.
I think your job situation needs to improve, but while you're looking start cutting out all of the whipped cream, and call about moving to cheaper plans on all of your monthly expenses or eliminate them entirely.
While moving might be cheaper, it's also another expense, which is really hard given your budget. If you were planning in moving in with parents to eliminate rent and daycare completely, that might be worth it, but there is still a risk in giving up a perfectly good job.