Okay, there are things to do but you are not going to like it. You've cut your current lifestyle to the bone, and the only way out is to change that lifestyle or make more money. You say making more money is impossible, so I'll spell out below what I'd do in your situation.
Annual Expense Sinking Fund: $500.00/mo. This monthly amount covers all of the below ANNUAL expenses
(Prop Taxes: 3400
Car Registration: 120
HOA: 500
Flood Insurance (we live in a high risk flood zone): 575
Home Maintanence/ Car Repair Sinking Fund: 1200
Cell Phone Minutes: 200.00
Magic Jack: $36.00)
Holy cow, this is weird. That's quite a bit in property taxes and HOA + flood insurance, that's over 400 a month right there. Right. There. This is going to be a common theme in my reply - you need to move.
Mortgage Payment: 500.00/ mo
Good mortgage payment, but this doesn't cover all that other shit. Call it $1042 with taxes/insurance. Not bad, really.
Utilities: $370.00/ mo
Includes: (these are all paid according to a budget billing plan which regulates the payment so that it is is the same year round)
Gas: $106.00
Electricity: $119.00
Water: $110.00
Internet: 35.00
There's fat to cut here, but it's not the worst I've seen. Not too much to say here.
Groceries: $400.00
Reasonable.
Clothing/ Haircuts: $60.00
Shop more secondhand and learn to cut hair and you can save here, but it's just trimming around the margins really. You'll need bigger cuts than that.
Gas/ Oil: $200.00/mo
Car Insurance for 2 cars: 88.00/ mo
What cars do you drive? You realize that's $500 every 6 months right? Full coverage or bad accident history? You likely need to get rid of a car and replace with a bicycle, ebike, scooter, something that doesn't cost $100 a month in gas/insurance.
Health Insurance: 300/ mo ( is through Medicaid until we are employed again- but this is our estimated cost because dh will work in a hospital)
Life Insurance: 20/ mo
Tithe: 400/ mo (We do not tithe currently, but really want to make this a priority when we have an income again)
That's pricey for insurance, will it not be subsidized by employer? Look into high deductible plan.
My opinion, you can't afford to tithe right now. If you hit FI you can tithe so much more as your stache makes more and more money. Save this for later.
Assets: Our home is valued around 275k and we owe 39k on it.
We have around 45k split between a Roth IRA and 401K
That's quite a lot of equity. I still think you need to move. I'd sell that house and go somewhere with no HOA or flood insurance, buy a cheaper house and use the difference to pay down those student loans. My brother, for instance, got a house for $80k last year and slapped some paint on it. Nice house, 3 bedrooms, plenty for 5 people. You may have to move to a cheaper city (hopefully stay near enough family) but you've got to cut expenses, and this is where you start. I mean, you could pay off your current house, and it is STILL $600 a month. That's not good in your position, not with a $500 student loan payment.
Our cars are in good repair and are paid for.
I have a Whole Life Insurance Policy worth about 5k cash
We just received an early inheritance of 10k and are trying to decide how to allocate it.
Debts: Our total student loan debt is around 34k
What cars, good mpg? Insurance costs are high as mentioned before. I suggest getting rid of any Whole Life policies, you can put that money to much better use. Term life is okay at this point, get a short term after FI it is not needed.
My suggestion stands - sell house, pay off student loans, buy one with cash where insurance and taxes are a bit cheaper. That should cut over $1k from your monthly expenses in one fell swoop. You can trim other fat if you want (the cars are the next thing to look at) but that one alone gets you in decent shape.
All this to ask- should we pay off the mortgage or our student loan debt? If we eliminate the mortgage payment we would eliminate a 500/ mo payment, or if we eliminate school debt then a payment of 455/ mo. We could feasibly pay off either one if we use all but 5k of savings, a big chunk of our Roth money, cash in my whole life policy and use this gift we just received. We would not do this until dh is employed, of course.
Also, one other detail that matters to me quite a bit, is that our mortgage is a private mortgage through family- we have a very low interest rate, but I do not want to continue to owe money to family members (this is the biggest and only factor that makes me want to pay off the mortgage instead of the student loans).
All the more reason to follow my advice. Fixes every one of these problems. Where do you live? I hate to make a blanket suggestion like that without knowing the real estate market at all.
