Case Study: Family of 4, $30,000 combined income, Canadian

[startswithhome]

Case Study: Family of 4, $30,000 combined income, Canadian

We've always considered ourselves frugal, and lived below our means, but being low income has made it hard to get to a stable place. Also, lots of job losses, and sucky stuff happened and ate our savings a few times.
My husband and I both have degrees, his is biochemistry, mine is a 3 year degree with virtually no job prospects (Bachelor of Community Design, if it was a 4 year degree I could be a member of CIP, and possibly find work as an urban or rural planner, but I've tried twice to complete the 4th year thesis project and failed, so let's avoid that time sink).
We have two kids, the oldest is 4 and autistic (that will be relevant for some reasons - we could get free childcare for her if we wanted, for example)
The youngest is 2 in February.  We had a family emergency that killed my small business startup while my husband was home with the kids. Turns out you need income to rent an apartment, but 0 savings to access the emergency programs (like income assistance).
Friends found my husband min wage work at a drycleaners and we've been house sitting since August, but that ends in January. We have a place lined up (unlike during the emergency).

Income:
My husband is working an average of 34 hours a week, for 16,000/year, no benefits. He has a lot of free time at work, but no internet access. (Husband suggest lowering the estimate due to a bunch of unpaid holidays off)
I am home with the kids. About $13,000/year ends up in our account due to CCTB, UCB, and disability benefits (autism).
I run a micro-micro business of making nauturally flavoured and coloured candy. I've reduced it to the only really profitable part. I make maple cotton candy and sell it at events. I haven't been doing a lot of events because I thought I'd be home. I thought it would grow fast, so I went in a lot of directions too quickly. I make decent pay per hour for most events I do (after subtracting table fees, car, supplies), but they're few and far between. I think it's worth the time doing cotton candy at events, but the other stuff I tried isn't profitable on a one-person scale. (Update: I called and was able to cancel my GST account, so this is even better)

Total: 29,000/year, 2420/mo

Assets: about 15,000 in a savings account

Liability: a student loan that is <9,000 (will ask husband to check), paying 100/mo. (Update: interest rate is approximately 3.5%, looking for a way to beat that with very secure investments)

Current expenses (rather fixed)
Rent (starting January): 795/mo for a 3 bedroom
Utilities: 80/mo ? (Last place was 100/mo, but we had in unit laundry)
Telecom: 80 for phone/internet (Reduced from 95 to match competition's offer for 6 months. By then the cell phone will be up and we can look at something more mustachian)
Cell phones: 55 (two smart phones were "free" when signing on for 2 years, almost up, it would probably cost more to get out of it, but I'm open to suggestions for new plans come August. I use data for GPS for my business)
Total: 1010

Non-fixed expenses
Food: 500 (this could be lower, probably. I have reservation prices for lots of things, cheese, eggs, meat, staple veggies, but I'm not meal planning, so we're eating more meat/frozen veggies, and very little rice/lentils/staples that just sit in my cupboard. We're gluten free (not to ppm, just not on the ingredient list) and it seems to make a big difference in 4 yo's behavior and focus)
Bus pass (husband)/tickets(me): 90 (bus pass 78, a few tickets a month)
Car: 33.33/month insurance (paid 400/year for insurance on 2000 Camry)
100/month gas (this will probably be less once we get to the apartment, the house we're in is a bit further out)
Toiletries/OTC medicine: 25/month average (I do the shoppers drug mart 20x the points events and stock whatever is low, then I usually blow the points ($200 worth or so) on crap for the kids for Christmas. I'm stopping that now. That was dumb. I will use them for staples and toiletries.)
Fun money: 40/month (20 each) This is an actual current budget. This is my husband grabbing a snack after work, me going out for a cup of tea with a friend. We've always had a budget for this, I think it keeps us sane.
Then it gets finer grain.
Total: 790

Total budgeted spending: 1815
We don't have a clothing budget, for example. I just spend as little as possible, repair, and do lots of swap nights with friends.


Things not in our budget, which sucks.
Term life insurance.
Health coverage. (Although, Canada, so what I'm really saying is that we don't have physio or dental)

4yo will be 5 next fall, but in our province there's this awesome program for autistic kids, called EIBI. Early Intensive Behavioural Intervention. It's a little less than a year, and they're trying to make it available to everyone, but they're a little behind. But if you start public school you can't be in it (because reasons?). So she may be waiting until 6 to start school, because that's what's best for her. Daycare or preschool would be free for us for her, because of the autism and our income. She's probably mastered all the primary skills anyway, but isn't 100% potty trained, so keeping her home or in a more supportive environment seems like it would be best for her socially.

We need more monies. Husband has lost confidence in applying for good jobs. Also he's experiencing multiple chemical sensitivity, so trades aren't such a good option for training in.  I'd REALLY like to get out of the house. Moving is not a great option now. We have a lot of community support right now. We have a few scenarios here:

I work, he stays home. We're both happier, I probably find a slightly better job.
We both work. We pay <$5 a day for 4 yo's daycare (depending on centre), and the full rate for 2 yo. Less things in my house are broken, probably some additional savings there.
I go to community college and get a engineering diploma, and then hopefully an interesting and higher paying job. How do we make up the money for this? Does he work or stay home?
I get a different, faster-to-train trade. Or some other marketable skill?


And yes please to ways to trim the budget now. Always good.

[marty998]

- What's your business? How much do you think you can pull in from it?

I would caution against using $9k right now to pay off your husbands student loans, if I were you I'd be trying to hang on to as much in savings as possible.

$15k is a great start and a stepping stone to more. Once you have cash, the idea is to hang onto it and grow it, not necessarily use it to pay low interest debts (assuming your student loans are low rate).

[MayDay]

I don't know the details but if I had an autistic 4 year old and a 2 year old, I'd be pretty reluctant to go car free in most areas. Special needs kids often have lots of appointments with specialists who are not located conveniently, and may have a very difficult time on public transport. 

That said, I am also curious about the income side. Is your business likely to start bringing in income? If not, time to look for a "real" job depending on the cost of childcare and your ability to work opposite your H. Speaking of, does your H have any better job prospects?

Perhaps scrubbyfish will stop in. She lives in Canada and has an autistic son, and has navigated a lot of social services.  There is a decent chunk of special needs parents here who can at least sympathize with you, if nothing else.

And definitely make sure your birth control is reliable, as I'm sure you know!

[alsoknownasDean]

Are there any better employment prospects for your husband? What about in another area (although that may be hard re: specialist appointments for the 4yo).

Cutting your phone costs and car costs and the like are great, but what's really needed in this situation is more income. Another ten or twenty grand a year is going to have a far greater impact on your finances.

That said, any way to get the food bill down?

[startswithhome]

Oh, poop.
I thought my computer ate my post part way through, not posted it and then locked up.
I will answer all the questions and more when I edit the post tonight after bed time. You guys/gals are lovely for posting to a half-finished mess. Husband saw it and is already excited and calculated how much we'd need to make on the money to make it better to not pay off the loan.

(We were car-free since we got married, but the recently purchased therapy-mobile needs to stay for a couple years. In order to be "fair" they put the specialist all over the 4-city area. 4 yo is on the cancellation list for dental surgery as well, so we need to be able to go at a few hours notice. We're car-lite for now, husband buses to work, I use the car once or twice a week for appointments, and then usually an errand/playdate where I plan the most efficient route and hit all those little things that would take so much longer individually.)

[NICE!]

No advice here, just wanted to tell you how impressed I am with your success. It is incredible what you've already accomplished.

[RichMoose]

You're really doing quite well considering your whole situation. You can definitely trim your expenses a bit by going to a cheaper internet plan. I wouldn't rush to pay off your student loan, it's important to have an emergency 'stash. You don't want to be in a position where you have to fall to credit cards.

Where do you live? Your income is very low and this easily holds you back the most. You have acquired the skill of living with less, so increasing your income could go a long way to improving your savings situation. Your husband should be earning more than he is considering his degree. Is moving to a different region a viable option?

[1967mama]

Congratulations and all you are already doing to keep your family afloat on a very low income!

A few thoughts:

1) Do you need data, now that you no longer need the GPS for your business? Could you use a map book instead?

2) Could you take in a child or two in a home daycare situation? Could you do dog walking? other side hustles?

3) Could you use your cellphones in lieu of a landline? Do you need 2 cellphones?

4) Is your food budget at rock bottom? So many great budget recipes on this forum. Shopping at the very cheapest grocery stores? Are you near the border where you can pop across the line for milk, eggs, cheese and chicken? Do you meal plan?

5) What is your 3 year degree in?

[startswithhome]

Thanks for the replies! I've updated the first post to reflect, I think, everything.

[scrubbyfish]

Gosh, you and I have a lot in common! Me: In Canada, parenting a child with autism, very low-income on average, costlier diet being a critical therapy for child (the most effective so far, by a long shot!), a business sideswipe two years ago did a number on my finances, have accessed some social supports, and have experienced that pickle of needing savings to get by yet being disqualified for help if we have them so ending up at zero net gain.

In BC, we don't generally have free preschool or free child care for kids with autism, so it's a great boon that you do!!

My head isn't clear enough at the moment to poke through the financial details of your post, but I can share some of what I do, and some leads. It sounds like you have an excellent head on your shoulder, in any case, and are on the right track. I think that even with the extra variables you're dealing with, you can go far!!!

1. We've been on the waitlist for subsidized housing and other services for a long time. However, in the last few years I have found more than one opportunity for very low private rent. Even in Vancouver, I paid $575/mo. Granted, we're a family of only two, so we fit nicely in the smaller suites that a lot of people aren't interested in. My point, though, is that there are sometimes opportunities to lower rent even further, and in the private market.

2. No landline, cell only (no data), Koodo @ $35/mo. This gives enough daytime minutes for emergencies, etc. For all other communications I use internet (included in current rent via wifi). When I needed more phone time, I paid $2.99/mo for Skype. So, I consistently had the lowest-cost internet I could find, used email as much as possible, used $2.99/mo Skype if I needed more time, and $35/mo cell for emergencies, etc.

3. I think your food bill is pretty good for four people, gluten-free. Nutrition (vs "food") is expensive in Canada. We can't really compare with US prices.

4. Get your child the RDSP!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! When you put $3500 in, the government of Canada puts in $10500. This is no help to you whatsoever for a while, but it's great for your kid when she's grown up. Any questions about that, or needing help with the application, ask me!

5. Some social service programs will allow savings IF the savings are in approved (exempt) account types. In several provinces, this includes the RDSP, RESP, and a "disability trust". So, there may be ways for you to save while getting help to get on your feet. Find out what might be a fit, line up your accounts to match them, then access help as needed. Doing this may help you access subsidized housing, welfare, etc.

6. I don't trust the system of "paying lots to go to post-secondary in hopes of better income later". It works out in some cases, it doesn't in a lot. If this pulls strongly for you, please talk with career counsellors, etc, before ponying up money.

7. This may be controversial on the forums, but I will say it: If you or your hubby (e.g., MCS) are significantly affected by disabilities such that your ability to work in conventional jobs is affected, consider resources for you, too. A write-off of the student loan, free schooling ("high needs part time" grant), free career counselling, RDSP for self, etc. A lot of these kinds of things are unknown. I used to work in a job helping people access these. These can make all the difference. (Some things, like the "high needs part time" grant for post-secondary might be available simply per low income and parenting a child with a disability.)

[startswithhome]

I think I feel as dubious of career counsellors as you do job-specific training. Every one I've met (sample size 8-10?) has been clueless, and basically fell into the job by chance (or pity, perhaps). I had one man yell at me that if I didn't go interview for a casual job an hour bus ride from my home with a small high - needs baby, that I didn't want to work. I told him from the start that I needed a predictable schedule so I could actually get child care.

[Jon_Snow]

OP, when I read your about your situation the phrase "you can't squeeze water from a stone" comes to mind. With that family income amount, there is not a lot more than you can do - I see very little "fat" in that budget. Even surviving on that amount of income is an achievement... but in order to "thrive"... you need more income. Not easily done, I realize.

Good luck, I will be following your progress.

[scrubbyfish]

I think I feel as dubious of career counsellors as you do job-specific training. Every one I've met (sample size 8-10?) has been clueless, and basically fell into the job by chance (or pity, perhaps). I had one man yell at me that if I didn't go interview for a casual job an hour bus ride from my home with a small high - needs baby, that I didn't want to work. I told him from the start that I needed a predictable schedule so I could actually get child care.

Yep, I've had exactly that experience. So, I don't mean those wildly ignorant-of-real-life "job placement" robots. I mean knowledgeable, aware, thoughtful, logical, well-informed people that can effectively help with researching how much a given career pays, how much the schooling for that costs, how much time the schooling takes, and the ratio of applicants to available jobs. Often, when we do that research, we find our dream job is, financially, a net waste, and we can move on to planning for something that's not. What I'm saying overall is to please not go to school unless/until you have some convincing facts in front of you. Too many pay for school hopefully, and simply end up with a bigger debt.

[APowers]

Just a suggestion, since you're currently in "any better job is an improvement" mode... I don't know what sort of area you're living in or whether it would actually work, but I currently work thurs-sun nights (5pm-1am) delivering pizza and bring home (net) anywhere from $1,600-1,800/mo. That's 24-30hrs per week, and hours that would let me job search for a "real job" on the side, since I have weekdays and mornings/afternoons free.

[startswithhome]

Updates added to the first post:
Telecom reduced!
No more GST filing for micro-business!

Frugal things planned:
Cancelling Netflix soon. DD 4 has dental surgery tomorrow. And have you seen the Maritimes on a satellite? $#!% I'll break it to her when she's not in pain and I can actually get them to the library.
Finding cheaper cell phones/internet/phone once the cell phone contracts are up.
We're in a lower cost area, and once the roads are covered in inches of ice, I will venture out to some super cheap stores and lower our grocery budget. Right now it just seems safer to have husband grab a few things at the grocery store before busing home.

No change on the job front yet.

[daverobev]

Guys, for cell try prepaid and just top up when you need to.

For example, http://www.speakout7eleven.ca/

Even $35 a month is a LOT if it's just for emergencies. Note that all topups with 7-11 extend airtime by a year! You pay $10 to get 100Mb of data, good for 30 days - for when you need the GPS.

[Learner]

My wife and I each use a dumb pre-paid cell with PC Mobile.  We normally only use this for emergency or "really important" calls.  We get the $100 card ($113 with HST) and it's normally good for us for 9-12 months depending what is going on.

We both call home fairly often, but we use the $2.99/month Skype plan.  We have the lowest TekSavvy internet plan (about $28) which is fine for us for basic Netflix, browsing and calls.

I grew up in the maritimes and will be moving back there soon.  Your grocery bill is actually pretty impressive.  I've ballpark estimated a 40-60% increase in maritimes prices over Ontario, for what we buy anyway.

Keep it up!

[daverobev]

I'm curious with skype - do you actually use it enough to make it worth having the plan? I just add credit and use it, which is pretty infrequent (I mean, I use free skype to skype, plus plenty of calls to free call numbers, but actually calling another person on a paid call is rare).

[Learner]

The $2.99 Skype plan lets you call phone numbers, so local businesses, parents (that aren't using Skype), etc.  in terms of voice communication, it's totally worth it.

[daverobev]

The $2.99 Skype plan lets you call phone numbers, so local businesses, parents (that aren't using Skype), etc.  in terms of voice communication, it's totally worth it.

How many minutes do you use, though? Calls within North America are 1c/min, to UK landlines are 1p/min etc. If you use more than a couple of hundred minutes a month it's good, sure.

I guess I don't talk much!

[going2ER]

I'm also in NS. My food bill is $500 per month with a teen and preteen to feed, and no special diets so I would say you are probably about as low as you will get that to. You could work on meal planning, plus it makes it easier to know what to cook that night.

If you have had EI in the past 3? years you would qualify as a reachback client and they would cover the cost of NSCC for you. Just make sure to research what jobs are actually available for the program you chose. You both should be working several hours a week to find better employment, it is out there.

With your family income you would also qualify for subsidy for your youngest child to attend daycare, its under Dept of Education. That would help to reduce costs, however, if you are even considering returning to work or school start looking for a center now as it can be hard to find a space.

[DSKla]

Glad to hear your son is having good results on gluten-free. My coworker has an autistic son, and first went gluten-free with great results, then upped the ante and took on the Auto-Immune Protocol diet, including lowering FODMAP consumption, and he found that his son improved even more than when just avoiding gluten.

Here's an overview: http://aiplifestyle.com/what-is-autoimmune-protocol-diet/

A while back, I made what I called a "tactical nuclear food list" for him, which was a cross-reference between AIP and low-FODMAP, including only foods that fell into both categories since they sometimes differ. If you would like, you can PM me your email address and I can forward the pdf. It is sadly a very short, one-page list.