So, I just found MMM a few days ago, and I feel like I got religion.
Ive been struggling for a while, trying to figure out how to get out of the financial mess we are in, and somehow find a way to have a life we all enjoy.
A little about us, I am a stay at home wife/mom to two kids, 8 and 5, who I homeschool. Im almost 39.
My husband is 48. He doesnt like his job, and complains every single night about having to go in the next day. Its taking a toll on his (and mine) sanity. He does have deadlines and tiny mistakes can cost the (small family owned) company lots of money, so it is stressful for him, and of course we wish he made more money.
We do homeschool our kids, and would love to travel, have funds to follow our passions by taking classes, etc, and I would be happy to move somewhere a lot less expensive than Chicago to live in. Not sure my DH would be excited to move. He hates change. He hates moving.
Our situation feels pretty dire to me, I will outline it all shortly, though I know that since he does have a pretty secure job, that we are ahead of some of our other friends, where the husband has gotten laid off.
We do have a lot of medical bills due to my DH and I each having a major surgery in the last 15 months.
Also, we currently in default on our mortgage.
A little about the mtg. We have lived in our condo for 12 years. Our mortgage was 145K when we stopped making payments in March 12. (now there are fees and stuff added to that total). We tried to sell it 5 years ago but got no offers. It was right when the market was tanking. Its in a 20 unit building and in the past 2 years, 4 other units have fallen into foreclosure. There are two across the hall from me, one just sold from the bank to an investor for 59,900. The other 3 are in various stages of foreclosure, but not owned by the bank yet and not listed for sale, but effectively my condo is worth 60K or less.
Our PITI is approx 1300$ plus a HOA of 357$. Its an 1100 sf, 2 br condo that was rehabbed 12 years ago. Our HOA fees went up last year (a long overdue raise, but for us it was $75 more a month) plus somehow our prop taxes went up 200$ a year to 2600$ year. $1650 is way more than we can sustainably pay for housing, and truthfully we could find a comparably sized place for several hundred dollars less. (maybe even half)
While we are not paying the mtg, taxes, or insurance as of right now, we are paying the HOA fee and tring to set aside cash for when we have to move (the 2400$ I mentioned earlier)
So, here is our situation:
Assets:
DH contributes 50$ week into a vanguard target retirement 2035 account. Currently he has 4 funds that have 1419, 1467, 1508, and 1417 totals. $5811 total. (there is some company matching, looks like they contribute $45 a week. not sure how these numbers got decided on)
DH has another idle retirement acct with a balance of $10533. IIRC, I just sent paperwork in to roll that into the vanguard accts, but Im not 100% sure.
I have an idle retirement acct from when I was working that I think is worth about 10k, but I cant find any statements right now. I havent added to it since I stopped working.
At this moment we have $2400 in cash.
We have no other savings. No stocks, etc. , no education funds
We do have health insurance (with 3500$ personal deductibles, 7500$ family, and plenty of copays, plus we pay 20% past the deductible)
No life insurance on either of us
DH makes approx 65$K a year. He gets paid hourly and works overtime, so it varies by his weekly paycheck. He usually gets a bonus worth one week of pay at the end of the year (included in the 65K I mentioned). He gets 3 weeks of paid vacation, but he cant take it consecutively.
Out of each weekly check comes 126$ for health insurance (we pay half, the co pays half) and $50 to retirement acct. He works about 50 hours a week. His commute can vary from 40 min.- 2 hours one way (depending on mode of transport and traffic) he works on the near southside of chicago.
His take home weekly pay is approx 850 on average.
Currently I babysit part time for about 140$ a week, but my hours will change in November to less, but Im not sure exactly how much.
Debts:
Credit Card with balance of $9000 at 0% interest for 10 more months
Credit Card with balance of $1500 that I meant to keep at 0 balance and already has gotten away from me again. Its an amazon rewards card.
Medical Bills approx $6300 total owed. I currently pay approx 300 month (have formal payment plans arranged for a couple, then I make sm. payments to the rest, with one larger payment to the lowest balance one to pay it off the fastest, etc)
Car Loan: (sigh.) 357$ month with 27 months left. Its a 2008 Kia Rondo. I love it so much. It has a third row for storage or 2 xtr seats. This comes in so handy with all the kid activities we do. We often carpool, have lots of supplies to take places, its roomy, it fits me and my DH, who are big people). The part that makes me sick to my stomach is that we also had a 2004 Honda civic that was paid off, but we sold it to my sister earlier this year. I thought it made sense to go to one car (though my husband resisited mightily and is still mad). I didnt think we could sell the KIa since we had a loan on it, and tbh, I liked it way more than the honda. DH and I agreed to share the car. He drives it to work 2 days a week and takes the bus the other 3. The bus can often take 1-2 hours one way. Its a massive time suck. He has to be at work by 8 and he gets home around 5:30 or 6:30.
Other Expenses:
Yearly:
eye exams : 100 family
contact lenses for DH: 400 (he also has glasses he wears at home at night)
Medical supplies for me: 75
Monthly:
Rent Fund: 1000 (trying hard to set this aside while we arent paying mtg)
HOA: 357
Med Bills: 300
Car Gas: 120
Cigarettes: 120 (DH smokes. Price just jumped up from 100$ month, plus he drives an extra 60 minutes/mo to go get them in the burbs)
Cell: 115 (DH uses 30 min a month, max. no texts. flip phone that w bad audio, I have an iphone with unlimited data, etc)
Cable: 100 (floated the idea of canceling and DH threatened to move into a hotel. I think he was joking. I hope)
Car insurance: 87
CTA fares: 80
Internet: 45 (cable internet as we have no home phone)
Kids allowances: 20/mo each. 40 total
Netflix: 8
Food: another sigh. this is where we always have problems. The past few months I have been seriously cutting back on groceries, and trying to do 100$ per week at the grocery store. However, I had previously made a bulk purchase of meat so my freezer was stocked with meat already.
But, we do tend to eat out too much. DH really loves going out to brunch once a weekend. Its very easy to do drive thur with the kids during the week when we have entire days out of the house. This is an area I know we can improve, but will take some family cooperation. we probably spend another 100$ a week on food out of the house
Other expenses would be clothes, classes for the kids, and any other enrichment activities we do with them. (Im not willing to negotiate on Homeschooling)
I buy most of our clothes at the thrift store. Right now the kids arent taking many activities. But I estimate that all the classes and stuff for Homeschooling ideally would be at 100-200$ a month (more would be even nicer).
So I havent added that all up, but I dont see how we could ever hope to live on 50% of take home pay.
I think that covers most of it.
in regards to the car, condo, commute:
DH works on near southside of chicago. its not that many miles away, but its on the other side of the whole Loop downtown area, and it takes a long time to drive past it/thru it. The housing right near there is not good, and then me and the kids would be on the other side of where all of our social lives are (and their activities and classes) However, I dont mind commuting as much as DH does, and I could do most of mine in off-traffic hours. Im assuming we will move and when we do, the commute is a major consideration. DH has to have a way shorter commute.
We are trying to work with the mtg company (citi) for a modification. I sincerely doubt we would get one, let alone one we would want. We would sell in a heartbeat, if we were not so dead underwater.
Re; the car. It would be a huge adjustment if we had nø çår at all. I know families who do it in chicago, but it would meet with serious resistance from DH and kids. (even if I wanted to and Im not sure!). DH has big extended family in suburbs and we usually see them once a month or so. I mean, it would just be the hugest lifestyle change we could make. Groceries, classes, everything. oy.
Re: the foreclosure. My dad is an atty and he said if we end up losing the condo, we may want to file for bankruptcy so we dont end up with a major tax liability. Also, if we did, we would wipe out our medical bills and cc debt. But he said bankruptcy might not be best, either. I dont know what to do. DH does not want to (nor has he ever) be involved with financial decisions. Ive always done it all, and clearly I need help. We spent the last 11 years overspending and living beyond our means, and now I see that there is a better way that will actually give us the lives that we really want. But I dont know how to get there. I dont even know where to start. Im beginning to realize that things I thought couldnt (or shouldnt have to) live without are tying us down and actually making life harder. Not sure DH is going to agree, and not even sure how to talk to him about all of this. He is angry and tired so much of the time.
I feel like its imperative we do something to improve our lives.
Please help. I know I will get punched in the face, but please do it nicely. :)
N