Author Topic: Just Woke Up To Discover I'm Drowning  (Read 64110 times)

Zx

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Just Woke Up To Discover I'm Drowning
« on: April 05, 2015, 10:38:55 AM »
Greetings! I found MMM a couple of days ago after clicking an article on Yahoo about the Go Curry couple who retired at 30.

Just a little surfing and reading and blowing out my cerebral cortex and I am AWAKE and ALL IN. But I'm in worse shape than anyone I've read about so far. Perhaps someone could give me some pointers?

I'm 50 and so is my wife. I work as an Instrumentation Technician and gross about 70k. My wife is self-employed as a Licensed Massage Therapist and makes about 12K, so our income is around 82K.

Debts:

105,000 in school loans, which I'm not paying at the moment

19000 in credit card debt

17000 owed on 2012 Nissan Sentra. Our other vehicle is a 1988 Toyota Landcruiser, which just enjoyed 6000 worth of repairs...all of which went to credit card.

I also have some personal loans from family that I wish to repay ASAP: 13,900


I am on a rice and beans diet, buy veggies once in a while to juice. For health reasons I no longer eat dairy or meat. Someone told me that means I'm vegan, but it's not a moral choice, merely a health choice. I've been doing that for two weeks now and have found it's also a financial boost!

My wife likes this whole idea of the MMM life but is loathe to give up shopping at Whole Foods, New Seasons, and Trader Joe's as she comes from a family that ate only organic, non-GMO, simple foods. She also likes nice things (who doesn't), likes to go to the beach for the weekend and stay in hotels and eat out (who wouldn't), etc, but I am more than willing to give it up for 10 or 15 years to get to my goal.

Just today she was looking through some ads and announced that Seaside has a new hotel with a covered salt water pool. Oh, have I ever swam in one of those, it's wonderful...and I repeated what is now my mantra: Sounds fun, too bad I'm looking for ways to NOT spend money.

All that to say that I'm all in and my wife likes the idea but isn't keen on going all in.

As for daily living expenses, at the moment we live rent free in a huge mansion that is on the market. We live in it and take care of it until it sells. So we have no rent, no power bill, no water bill, no nothing except the owners wanted us to pay for internet and cable: 130 per month.

Since this house is way out in the country, about 5 miles from anything and 25 miles from work, I can't sell the Sentra (which I drive) in order to bike to work and save massive bucks!

My wife needs a larger vehicle to carry her massage table and her equipment, as she has clients all over the area and drives to them to give massage. This is rare and partly why she has such loyal clientele.

I work 4 tens, weds through saturday, and have been looking around for someplace I could work part time on the 3 days I have off, or thinking of some part time business I could start, or really just anything to bring in more money. I want to start taking massive monthly hacks at our debt but feel like my income is stagnant for now so that I have to find a way to make 82K income work hard while the rent free life lasts.

We have no toys to sell: no bikes, motorcycles, boats. No rec vehicles of any kind.

So here I am, just waking up and finding myself in a horrible situation from my own amazing stupidity and ignorance. Words really don't do me justice, I think. But I'm awake now.

I'm not putting anything into work's 401k program to make my net check bigger, and my plan is to attack the highest interest/lowest balance first and do the snowball thing. Other than that I don't know what to do.

Any suggestions?

« Last Edit: April 05, 2015, 10:41:38 AM by dagiffy1 »

justajane

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Re: Just Woke Up To Discover I'm Drowning
« Reply #1 on: April 05, 2015, 10:45:03 AM »
Have you already subtracted the amount of expenses from your wife's 12K? i.e. gas, equipment, wear and tear on the car? If not, then she really isn't making very much. If her clients like her so much, perhaps she should be raising her rates. Or find more clients. Or find another career entirely. What about working at one of those places where the clients come to her?

Looks like you have a sweet deal with your housing. Capitalize that and definitely debt snowball your credit cards.

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #2 on: April 05, 2015, 10:53:26 AM »
Thanks for replying!

This is definitely a low point in her income level since I met her ten years ago. For a time we lived out of state, so she flew in for a week every month to make 1200 and see friends, and with all the write offs and after taxes she netted 700. We've come back to the area but her clientele has shrunk from the days when she was grossing 1400 per week, but she wasn't trying to grow it while we were gone.

We expect her income to double by the summer. If not then we have some decisions to make. She's not ALL-IN with this, though, so I doubt I could convince her to quit massaging and find something that makes more sense! Her clients have become her family and she's not about to give this up.

It's so frustrating to see all that's possible but large changes just aren't possible at the moment.

bacchi

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Re: Just Woke Up To Discover I'm Drowning
« Reply #3 on: April 05, 2015, 10:58:43 AM »
The good news is that you make good money.

The bad news is you have to make TOUGH decisions now.

1) Sell the Sentra and get a less expensive car. Think Yaris or Fit or Civic, used.

2) Think about selling the Landcruiser. I know you just put $6k into it but it sounds like a money pit (and gas-wise, it is). Get a more reliable car.

3) Drop cable. Get hulu+ or netflix or amazon prime instead.

4) I'd personally let the food argument go but you can buy organic rice and beans. Get some tortillas and an avocado and there ya go -- healthy breakfast/lunch/dinner for very little.

You haven't listed your spending but you should be able to wipe out the personal loan and CC debt in a year. You have no mortgage or rent. Your non-debt expenses should be like $1500/month, max.

Yeah, a 2nd job, even for a year, would help a lot.

Kris

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Re: Just Woke Up To Discover I'm Drowning
« Reply #4 on: April 05, 2015, 11:01:20 AM »
Wow.  That is a lot of debt.

Step one is to sell the 2012 car. Pay off the loan, and buy a similar car that's a much older model, say, 2005. 

Wnat are your monthly expenses? It looks to me like you should be able to put about 90% of your monthly salary towrd debt, especially since you have no housing expenses.

tomk2

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Re: Just Woke Up To Discover I'm Drowning
« Reply #5 on: April 05, 2015, 11:01:55 AM »
Congratulations, waking up is the first step. Frankly, I don't think your story is much different from the reader case studies mmm presents. Check that article series, but here's the TL;DR:
you can't afford beach weekends and eating out. Remove the ads that are temptations. Can you cut the cable? You should consider trading down cars, you both should look into making more money.
Sounds like you're good on the general principles of that. Make sure you comfortably bring your wife along. You'll work best as a team. Make sure she knows your financial situation.

aschmidt2930

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Re: Just Woke Up To Discover I'm Drowning
« Reply #6 on: April 05, 2015, 11:08:58 AM »
With your financial picture, your wife does not have a job, she has a hobby. She's making under minimum wage. If you're both all in, she needs a new job.

Sell the car immediately, and get something cheaper. Owing 17k for a car is insane with credit card and student loan balances like that.

With that said, you can climb out of this quickly with a few lifestyle changes and an increased household income.
« Last Edit: April 05, 2015, 02:36:57 PM by aschmidt2930 »

cavewoman

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Re: Just Woke Up To Discover I'm Drowning
« Reply #7 on: April 05, 2015, 11:24:43 AM »
She can keep her clients AND work at a place where the clients come to her. Start looking at chiropractic offices, many will have a therapist who comes in 3-4 days a week. My SIL does this and makes 20/hr + tips, then still has days to take individual clients.

ambimammular

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Re: Just Woke Up To Discover I'm Drowning
« Reply #8 on: April 05, 2015, 11:52:25 AM »
Wife needs to get a full time job and schedule her clients for her off days or after work. She's not working enough to get a seaside vacation. Most of her week is vacation time.


Unique User

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Re: Just Woke Up To Discover I'm Drowning
« Reply #9 on: April 05, 2015, 11:53:52 AM »
What are your expenses and how much do you have to throw at debt per month since you have no rent/mortgage?  Does your 401k have a match?  Will your wife entertain another job, $12k isn't much when you have debt and no retirement savings at 50. 

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #10 on: April 05, 2015, 11:58:25 AM »
LOL I am taking this, as I should, as slaps in the face. As if you are all telling me, "You said you were awake! You're still dreaming...WAKE (slap) UP (slap)!"

You are right. I should sell this car now and buy something cheaper. Unbelievably I just gave to charity (9 months ago) a perfectly nice 1991 Toyota Corolla that ran fine but didn't look good, and against my better judgment I agreed to let it go because "we deserve to drive something nice at our age". Stupid stupid stupid.

I agree that my wife has a hobby. Today I suggested that if she doesn't double her income by this summer then we have some choices to make. But, as I said before, she is NOT all-in. If she can't double her income, she won't give it up to work full time someplace. She just won't.

It's going to be harder for her because she grew up in less than poverty, lived in tents with sand floors in the desert with her family, no running water or sewer and bathing in rain water, nothing nice ever, her Dad didn't believe in working but DID believe in spending any money he did have on ridiculous nonsense. 

I don't know if I can ever get her to adjust to the MMM lifestyle. She lived with nothing for almost two decades, forced upon her, and doesn't want to go back  even if not going back to it means we stay in debt till we die. It's that ingrained. She is good with money (debt free with savings when I met her), but in this situation she needs a moustache! Count on her as being a 3/4 convert and nothing more and I will have to work with that.

I need to count our spending for a month to itemize it out, but as an example the last time my wife came home from grocery shopping she had a bag of pinto beans, a bag of brown rice, and vegetables for salad. She found some Heidi Ho cheese and also some almond milk yogurt (because I won't eat dairy). Again, I am willing to ONLY eat rice and beans and some veggies, while she goes out of her way to free me from that constraint.

Then again, this is all new. I only discovered MMM 3 days ago and the Go Curry couple last week.

So I'm selling the car. We owe more than it's worth, but if I can get close to what it's worth I'll just pay the loan off (we have the Dave Ramsey "emergency fund" at about 6000, but figure we will owe taxes so not sure how much of that will be left).

I will then look around for a cheaper, fuel efficient car. If not, maybe I can bike to work. It's 25 miles and the roads getting there aren't the safest (2 lane country roads), and I have to always do one way in the dark whether I do dayshift or night shift. It might not be worth the danger?

Would you recommend me working 7 days per week if the second job only paid 10 an hour? I've been scouring the local job market and that's about all I can find.

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #11 on: April 05, 2015, 12:01:57 PM »
What are your expenses and how much do you have to throw at debt per month since you have no rent/mortgage?  Does your 401k have a match?  Will your wife entertain another job, $12k isn't much when you have debt and no retirement savings at 50.

Yes, 401K has a match at 4%.

My wife won't entertain another job, no. She charges 70 an hour and won't work for 10. Obviously the people who can afford her have money to spend, and so she sometimes does other work for them and charges 20 an hour. She also does pet sitting and gets 35 to 50 per day. She is NOT lazy, not by a long shot, but she has "standards". She is a 3/4 MMM convert....for the time being.

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #12 on: April 05, 2015, 12:09:59 PM »
The good news is that you make good money.

The bad news is you have to make TOUGH decisions now.

1) Sell the Sentra and get a less expensive car. Think Yaris or Fit or Civic, used.

2) Think about selling the Landcruiser. I know you just put $6k into it but it sounds like a money pit (and gas-wise, it is). Get a more reliable car.

3) Drop cable. Get hulu+ or netflix or amazon prime instead.

4) I'd personally let the food argument go but you can buy organic rice and beans. Get some tortillas and an avocado and there ya go -- healthy breakfast/lunch/dinner for very little.

You haven't listed your spending but you should be able to wipe out the personal loan and CC debt in a year. You have no mortgage or rent. Your non-debt expenses should be like $1500/month, max.

Yeah, a 2nd job, even for a year, would help a lot.


The no-rent situation won't last, it's just the way it is at the moment. A great blessing but I can't count on it lasting for long.

We could cut cable, but this isn't our house and the TV in the main room (where the kitchen is and where my wife spends most of her time) isn't a smart TV and we can't switch it for one that is. This will be a hard sell to my wife, but maybe I can talk her into it.

I am going to sell the Sentra. You've all been unanimous with that, so that's first.

Selling the Landcruiser would be harder because the 6k in repairs is still on the credit card. It is a gas hog, yes, at 15 mpg on the freeway and much less in the city. At the moment she bunches her massage appts on the same days/areas of town so to save fuel, and I don't know that we could afford to buy her something large without getting a loan, even if it is well used. I would hate to be making payments on the repairs while making payments on another rig.

Or maybe this makes sense. I obviously can't trust my own judgment or I wouldn't be in this mess.

Merrie

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Re: Just Woke Up To Discover I'm Drowning
« Reply #13 on: April 05, 2015, 12:27:24 PM »
The 6k on the credit card is sunk costs. It shouldn't make a difference to the decision about the fate of the Landcruiser. First look into how much it would cost to get a cheaper, more fuel efficient vehicle that would meet her needs space-wise.

bacchi

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Re: Just Woke Up To Discover I'm Drowning
« Reply #14 on: April 05, 2015, 12:34:23 PM »
We could cut cable, but this isn't our house and the TV in the main room (where the kitchen is and where my wife spends most of her time) isn't a smart TV and we can't switch it for one that is. This will be a hard sell to my wife, but maybe I can talk her into it.

Unless the TV is 20 years old, a laptop can plug into it with the right cable. Really, though, cable is low hanging fruit at this point.

I personally wouldn't bike 25 miles on 2 lane country roads in the dark.

justajane

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Re: Just Woke Up To Discover I'm Drowning
« Reply #15 on: April 05, 2015, 01:01:57 PM »
She also likes nice things (who doesn't), likes to go to the beach for the weekend and stay in hotels and eat out (who wouldn't), etc, but I am more than willing to give it up for 10 or 15 years to get to my goal.

I wanted to highlight this part, because I want you to clarify what you want. Are you attempting to implement MMM principles so that you can FIRE? Or in order to pay off your debts? Or both?

Because this sentence implies that the dialing back is a short term thing for you, but if you want to FIRE, you would likely have to dial back these things permanently.

The MMM model isn't the Dave Ramsey model - "If you will live like no else, later you can live like no one else." This implies that you will eventually up your consumption. I guess if you are a very high earner and save up millions, you could calculate your FIRE expenses at 75K or higher, but most people on here have them much lower, i.e. their eventual plan is not to stay in hotels and eat out all the time. Their goal is to have their freedom, and this includes getting off the hedonic treadmill.

Argyle

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Re: Just Woke Up To Discover I'm Drowning
« Reply #16 on: April 05, 2015, 01:06:50 PM »
If you track and then post your monthly expenses, we can comment more helpfully.  And perhaps if your wife sees that this is all leading up to solvency and freedom to buy what you decide on, debt-free, she will be more inclined to get on board. 

frugaldrummer

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Re: Just Woke Up To Discover I'm Drowning
« Reply #17 on: April 05, 2015, 01:07:25 PM »
First of all, a minor correction: your wife doesn't really make $70 an hour. she makes, at best, 70 minus self-employment taxes of around $6 minus $5-10 in mileage expenses to get to and from clients, so say $55 for 1 1/2 to 2 hours work depending on travel time, so maybe $30 an hour. Still nothing to sneeze at, but she needs to keep it in perspective.

What is she doing today to advertise her services and increase her clientele?  Also, does she have and back or wrist problems? (Many masseuses become unable to work with age due to problems in these areas).

How big is her massage table?  I have a Toyota matrix hatchback which gets great gas mileage and accomodates a vibraphone or a full drum kit, perhaps she could fit her table in this? 

Also, I agree she needs to get her income up....if she can increase her clientele, great.....if not, a part time morning job would still leave her free to do massage.


waltworks

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Re: Just Woke Up To Discover I'm Drowning
« Reply #18 on: April 05, 2015, 01:22:46 PM »
I am having trouble wrapping my brain around a $70/hour job in which one makes $12k/year. That's what, something like 30 minutes a day average?

-W

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Re: Just Woke Up To Discover I'm Drowning
« Reply #19 on: April 05, 2015, 01:35:36 PM »
What's the story with the $105k in student loans?  Why are you not paying them?  Are they in forbearance?  If not, have you defaulted?

You can BK out of the consumer stuff if it comes to that, but what's your plan for the student loans?

Yonco

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Re: Just Woke Up To Discover I'm Drowning
« Reply #20 on: April 05, 2015, 01:38:29 PM »
Start listening to Dave Ramsey, and read a few of his books.  It sounds like youll be focused on debt elimination for a few years( Daves specialty) and not necessarily financial Independence( MMM special)

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #21 on: April 05, 2015, 01:54:38 PM »
I am having trouble wrapping my brain around a $70/hour job in which one makes $12k/year. That's what, something like 30 minutes a day average?

-W

On average 3 hours of massage a week, give or take, at 70 an hour.

Now, when I met her she had two days per week in which she'd have 5 massages, and two other days in which she'd have 3 massages. She took the other 3 days of the week off. She had no debt, about 50k in 401k, and plenty of cash.

Then she met me and we got married, both for the first time, at 40. I still remember our first purchase: a 1000 dollar 40" flat screen, which we put on credit. It went downhill from there.

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #22 on: April 05, 2015, 01:57:28 PM »
She also likes nice things (who doesn't), likes to go to the beach for the weekend and stay in hotels and eat out (who wouldn't), etc, but I am more than willing to give it up for 10 or 15 years to get to my goal.

I wanted to highlight this part, because I want you to clarify what you want. Are you attempting to implement MMM principles so that you can FIRE? Or in order to pay off your debts? Or both?

Because this sentence implies that the dialing back is a short term thing for you, but if you want to FIRE, you would likely have to dial back these things permanently.

The MMM model isn't the Dave Ramsey model - "If you will live like no else, later you can live like no one else." This implies that you will eventually up your consumption. I guess if you are a very high earner and save up millions, you could calculate your FIRE expenses at 75K or higher, but most people on here have them much lower, i.e. their eventual plan is not to stay in hotels and eat out all the time. Their goal is to have their freedom, and this includes getting off the hedonic treadmill.

My first goal is debt eradication.

Second goal is FIRE...not sure what that is, but I assume it's living within your means as inexpensively as possible, so that at 4% gain on your green employees, you can never work again.

All I see right now are sirens and lights going off, the ship has sunk and the tip of the bow is sticking up out of the water, and my wife and I are hanging on right there.

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #23 on: April 05, 2015, 02:00:12 PM »
What's the story with the $105k in student loans?  Why are you not paying them?  Are they in forbearance?  If not, have you defaulted?

You can BK out of the consumer stuff if it comes to that, but what's your plan for the student loans?

Yes, the loans are in forbearance. They are our lowest interest debt, and with the other debt in the midst of it, paying on them would be bb's fired at Everest. So we decided to not pay them back until our other debts are zeroed out, then we can put everything we've got at those student loans.

The problem was that I didn't realize we are in EMERGENCY conditions. I was asleep/stupid/ignorant. I've been spending more than I made my whole life.

Argyle

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Re: Just Woke Up To Discover I'm Drowning
« Reply #24 on: April 05, 2015, 02:04:25 PM »
Coming here and inviting the face-punches are the first steps towards a whole new life.  You done good.  You've found the lifeboat, hauled yourself in, and you're rowing away from the wreck.

handsnhearts

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Re: Just Woke Up To Discover I'm Drowning
« Reply #25 on: April 05, 2015, 02:09:51 PM »
You make a good income, and you are living rent free for now.  those are great blessings and you can use them to move forward quickly.  Most people have a lot of debt with high housing costs. 

If you are taking home about 5000 per month, you should be able to pay the family loans in 3-4 months, and take the rest from there!

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #26 on: April 05, 2015, 02:15:28 PM »
First of all, a minor correction: your wife doesn't really make $70 an hour. she makes, at best, 70 minus self-employment taxes of around $6 minus $5-10 in mileage expenses to get to and from clients, so say $55 for 1 1/2 to 2 hours work depending on travel time, so maybe $30 an hour. Still nothing to sneeze at, but she needs to keep it in perspective.

What is she doing today to advertise her services and increase her clientele?  Also, does she have and back or wrist problems? (Many masseuses become unable to work with age due to problems in these areas).

How big is her massage table?  I have a Toyota matrix hatchback which gets great gas mileage and accomodates a vibraphone or a full drum kit, perhaps she could fit her table in this? 

Also, I agree she needs to get her income up....if she can increase her clientele, great.....if not, a part time morning job would still leave her free to do massage.

Thank you for the suggestions. We just blue booked our Nissan and will search for something that works for her, too.

No back or wrist problems. She just got new business cards made. She only wants word of mouth advertising because of safety issues going into peoples' homes, and her word of mouth advertising has historically given her all the work she could handle. Basically she gives business cards to her clients to hand out and has gotten 4 new clients in the past 2 months with this method.

A major client who winters in Palm Springs is coming back to town, and this is an 800 per month client with many referral possibilities. I'm willing to wait till summer to see how it turns out. If not, part time job is on her horizon. :)

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #27 on: April 05, 2015, 02:17:25 PM »
If you track and then post your monthly expenses, we can comment more helpfully.  And perhaps if your wife sees that this is all leading up to solvency and freedom to buy what you decide on, debt-free, she will be more inclined to get on board.

Thank you. We are starting that today, every cent.

Cpa Cat

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Re: Just Woke Up To Discover I'm Drowning
« Reply #28 on: April 05, 2015, 02:29:17 PM »
I am having trouble wrapping my brain around a $70/hour job in which one makes $12k/year. That's what, something like 30 minutes a day average?

-W

On average 3 hours of massage a week, give or take, at 70 an hour.

Now, when I met her she had two days per week in which she'd have 5 massages, and two other days in which she'd have 3 massages. She took the other 3 days of the week off. She had no debt, about 50k in 401k, and plenty of cash.

Then she met me and we got married, both for the first time, at 40. I still remember our first purchase: a 1000 dollar 40" flat screen, which we put on credit. It went downhill from there.

It sounds like there's a lot of hope here for your wife. That lady made it to age 40 without debt, living within her means and saving for retirement. Apparently you ruined her. ;)

In all seriousness, I think you should be able to convince her to get back to where she was at 40. She has a variety of side gigs - massage, pet sitting, etc. She doesn't want to advertise the massage gig too much - that's cool, but she could entertain renting a space somewhere in order to make the whole thing more practical - then schedule her 5 appoints (or 3) back to back - no travel. Her clients will visit her there.

In addition, she can advertise her pet sitting business. Every time she picks up a pet sitting client, she can give them her masseuse card.

With your debt situation, she needs to dial it up to something approximating full time. That doesn't mean she has to go work for "the man" - but she does need to start treating her job like a job. It sounds like she's done it before, so it shouldn't be much of a leap to do it again.

For yourself, I'd take that $10/hour job on your off days, then quit it if the pet sitting gig grows to where you and your wife can work it together.

Another Reader

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Re: Just Woke Up To Discover I'm Drowning
« Reply #29 on: April 05, 2015, 02:37:49 PM »
Good job on handling the student loan fire.

What are your payments on the Nissan Sentra?  My concern is you have to have reliable transportation to get to your job and I'm not sure how you will purchase that after you sell the Nissan and come to the table with cash out of your emergency fund.  Have you done the Dave Ramsey thing of listing all your debts smallest to largest?  In your shoes, I would cut every other expense to the bone, get some more money in the bank and get ahead on some of the other debt before I dealt with the car.  If the house sells, you could move closer to your job and sell the car then.

If you write up a case study with all the numbers, you will get a lot of feedback on how to cut your expenses and pay off the debt.  You can make a list of action items to sit down and discuss with your wife.

Unique User

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Re: Just Woke Up To Discover I'm Drowning
« Reply #30 on: April 05, 2015, 02:43:28 PM »
What are your expenses and how much do you have to throw at debt per month since you have no rent/mortgage?  Does your 401k have a match?  Will your wife entertain another job, $12k isn't much when you have debt and no retirement savings at 50.

Yes, 401K has a match at 4%.

My wife won't entertain another job, no. She charges 70 an hour and won't work for 10. Obviously the people who can afford her have money to spend, and so she sometimes does other work for them and charges 20 an hour. She also does pet sitting and gets 35 to 50 per day. She is NOT lazy, not by a long shot, but she has "standards". She is a 3/4 MMM convert....for the time being.

You need to put 4% in your 401k to get that match.   I think most people on these boards would agree with me, you're 50 and that's free money. 

To a certain degree I understand your wife's reluctance, but she also needs to be realistic.  She  works 3.5 hours per week and you guys are in an emergency.  You're 50, in debt with no savings.  When our income was lower we did a variety of odd jobs to increase money coming in.  We've made money selling curb/dumpster finds, done caretaking and even the last two years with great income, I've still done some mystery shopping work and have a fiverr account.  Check out the side hustle threads for her, although maybe the pet sitting and massage is enough. 

Increasing income is only part of it, if you don't know what you are spending or spend that extra money to make yourself feel good about being in such a bad situation, you won't get ahead.  Track your money, but you also need to find inexpensive outlets for fun as you make these changes. 

Without housing costs, you should be able to knock out the personal loan and cc debt fast.  In terms of what you should do with the student loans, I'll have to leave that to the experts here that will know if you have any other options other than paying the whole amount back due to age/income. 

Since you are both 50, another good exercise would be to look up what you can get in SS.  There are a couple threads on here on how to estimate, DH is in his early 50s so I'm certainly taking his SS into account with our plans. 

justajane

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Re: Just Woke Up To Discover I'm Drowning
« Reply #31 on: April 05, 2015, 03:06:04 PM »
Since she works so few hours a week, couldn't her second "job" be to work on lowering your household expenses? What's your grocery budget? If it's anything above $400 (and I'm guessing it is), then she could work on meal planning, cooking from scratch, etc. If you have a clothing budget, she should spend time organizing your clothes so that you realize how much you have and don't need to shop for those anymore. She could go through your stuff and sell things on Craigslist. If you're worried about safety, these days you can always meet some place neutral in public.

Your debt is such that you do indeed need to sweat the small stuff. If she won't work for $10 hr, working on lowering your expenses could be just as good for your bottom line.

midweststache

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Re: Just Woke Up To Discover I'm Drowning
« Reply #32 on: April 05, 2015, 03:37:26 PM »
Since she works so few hours a week, couldn't her second "job" be to work on lowering your household expenses? What's your grocery budget? If it's anything above $400 (and I'm guessing it is), then she could work on meal planning, cooking from scratch, etc. If you have a clothing budget, she should spend time organizing your clothes so that you realize how much you have and don't need to shop for those anymore. She could go through your stuff and sell things on Craigslist. If you're worried about safety, these days you can always meet some place neutral in public.

Your debt is such that you do indeed need to sweat the small stuff. If she won't work for $10 hr, working on lowering your expenses could be just as good for your bottom line.

This. You make the comment that your wife isn't lazy, and I don't want to push back against that too much because, well, I don't know her situation exactly, but if she's only working 3.5 hours a week and then wanting to go on these weekends away and dine out and only buy organic groceries, it seems she wants to reap the benefits without doing the work (which to me seems lazy).

BUT, if as justajane suggests, she's working on ways to lower your costs at home, then such pursuits might be worth it. I also wonder if there are massage therapy schools in your area and, if so, if your wife would be qualified to teach at one? I don't know what the process is for teaching massage therapy, but that could continue to offer a flexible schedule, bring in more money, and be in a field your wife clearly loves. She might even get some benefits out of the deal (like a 401k)!

Finally, do you have a plan in place for paying off your debts? I didn't see any %s on the debt interest, and I know people have different priorities, but getting a really detailed breakdown of monthly income, budget, loan payments, assets, liabilities, etc. (see "How to Write a Case Study") would be super helpful.

Welcome to MMM! Best of luck! We're all rooting for you!

Sofa King

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Re: Just Woke Up To Discover I'm Drowning
« Reply #33 on: April 05, 2015, 04:03:32 PM »
With your financial picture, your wife does not have a job, she has a hobby. She's making under minimum wage. If you're both all in, she needs a new job.



I concur.

Exflyboy

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Re: Just Woke Up To Discover I'm Drowning
« Reply #34 on: April 05, 2015, 05:13:26 PM »
I read the part about your Wife grew up in poverty and doesn't want to go back.

Well here is a facepunch for you... You ARE going back.. either that or you will never be able to afford to retire.. I doubt your Social security payments will pay your debts and allow you to live at your current level of spending.

Want that?.. no didn't think so, well then you could with a lot of commitment (and assuming you never lose your job) be both debt free and close to being FI by normal retirement age.

You Wife needs a real job and you need to get shit paid off (starting with CC's) stat!

Sorry but your both in a world of hurt and this is going nowhere good.


clifp

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Re: Just Woke Up To Discover I'm Drowning
« Reply #35 on: April 05, 2015, 06:04:26 PM »
By the standards of this forum you are really bad shape. But by the average American standard just a bit below average..

Most of the specific advice is good. Whole paycheck is crazy expensive and I think its worth keeping careful track of how much you spend there, and identify specific things you can buy else where. Costco sells plenty of organic stuff now and it's 1/3 price of Whole Food.

To me the the number 1,2,3 priority is to get your wife on board.  One of my best friends was married to a high spending wife, after she passed away, he married a woman who was determined to have a farm,and they are managing to go through his late wife's inheritance at rapid rate. However, the truth is despite my friends view that's it is his wifes fault he is co-contributor to their problems.

Any chance you can get your wife to participate in the forum?

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #36 on: April 05, 2015, 06:21:37 PM »
Well it's worse than I told you, because I forgot to mention we owe 22k to a previous employer for breaking the 2 year contract stipulating I'd pay back moving expenses if I left early.

In other news I just interviewed to go back to that job and, if I land the position, this 22k debt will be forgiven. My income will also double, almost exactly. We find out if I get this job in the next couple weeks. I was told I'm the most qualified candidate and most likely will get the job, but it isn't mine yet.

If I get this job, and it's out of state, I'm moving there by myself to live with people I know already and renting a room. Costs to live at this place will be 750/month, plus food. I discovered that if I bike it from there to my new job it's a hair over 8 miles. This is in the Bay area, so I could do it weather-wise. My wife will stay here rent free.

My wife, bless her heart, asked me if I could support her once I moved down there. I was incredulous, of course. If she is "working" and living rent free, paying only the Landcruiser gas and her food...and she needs money from me to live...I told her she had no business living and working here if that's the case.

She does have an obligation to stay in this mansion until it sells...which could be 1 month or 5 years since it's a property worth millions...so we will be separated and I'm willing to pay that price to be FI one day.

We are going to wait to sell the Sentra until after I find out whether or not I land this new job. If I do, I'm selling the Sentra and not buying any car, just a bike. If I don't get it, I'm selling the Sentra and buying a Tercel or something.

I just started tracking every cent we spend today, so I should have the data to write up my case study by first week of May. Thanks for the punches to the face and the withering body blows. I need it!

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #37 on: April 05, 2015, 06:29:37 PM »
By the standards of this forum you are really bad shape. But by the average American standard just a bit below average..

Most of the specific advice is good. Whole paycheck is crazy expensive and I think its worth keeping careful track of how much you spend there, and identify specific things you can buy else where. Costco sells plenty of organic stuff now and it's 1/3 price of Whole Food.

To me the the number 1,2,3 priority is to get your wife on board.  One of my best friends was married to a high spending wife, after she passed away, he married a woman who was determined to have a farm,and they are managing to go through his late wife's inheritance at rapid rate. However, the truth is despite my friends view that's it is his wifes fault he is co-contributor to their problems.

Any chance you can get your wife to participate in the forum?
[/i]

Zero chance! I read her all the posts you guys have sent, and I also sit her down and read her articles on MMM. I think just marinating in this MMM way of life is going to win her over. She's pretty frugal with buying food and she's already talking about buying bulk beans at Costco and so forth, so her brain is starting to churn out some ideas already. She marched into the room this morning wearing an outfit that looked nice. "Like it?" she asked. "It cost 13 dollars!"

She's on board with being frugal but she's always cringed when Dave Ramsey talked about the rice and beans, tunnel vision burning passion. She thinks you just don't need to be that severe or something. I think we'll get her there.

I am more than the co-contributor to our problems. I am the main cause of the problems! Just me going all in is going to help us a lot.

Exflyboy

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Re: Just Woke Up To Discover I'm Drowning
« Reply #38 on: April 05, 2015, 07:34:31 PM »
Ruminating out loud might be a good way.. You might want to consider ruminating on some of the sucesses too.. Mine just by way of an example started out at $160k in debt and ended up at FI in about 17 years.

Your salary (if you get the new job) will be similar to our combined salary so there is no reason you can't nail this.

But getting your Wife to see the light is clearly goal number one.

Goal number two is to not buy crap you don't need

#3 is get that CC paid off ASAP

#4 is pay off the other debts (unless the APR is less than say 3%)

#5 is to start maxing out 401k (including the catch up contribution)

#6 is to invest the rest in Roth IRA's and taxable investments.

As to investments I would say your going to have to be heavy in stock ETF type investments in order to get the growth you need.

All the best!

Zx

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Re: Just Woke Up To Discover I'm Drowning
« Reply #39 on: April 05, 2015, 10:12:25 PM »
We had The Talk this evening. My wife is on board.

All of your advice is gold to us and we are putting our noses to the grindstone. Looking for P/T work on my days off, recording every cent spent, paying off CC debt.

Right now my wife has a lady for whom she can work for 20 an hour all she wants till the work is done, and she's ready to put in the hours.

I'm optimistic and excited to get down the road!

Argyle

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Re: Just Woke Up To Discover I'm Drowning
« Reply #40 on: April 05, 2015, 10:23:52 PM »
Fabulous!

lemanfan

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Re: Just Woke Up To Discover I'm Drowning
« Reply #41 on: April 06, 2015, 01:14:21 AM »
Nice!

FIRE me

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Re: Just Woke Up To Discover I'm Drowning
« Reply #42 on: April 06, 2015, 01:26:14 AM »
I'm optimistic and excited to get down the road!

Well done. In just a few years, you'll be posting in the “Share your Badassity” section.

Retire-Canada

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Re: Just Woke Up To Discover I'm Drowning
« Reply #43 on: April 06, 2015, 07:37:27 AM »
She marched into the room this morning wearing an outfit that looked nice. "Like it?" she asked. "It cost 13 dollars!"

I'm glad she's making some changes. You need to point out that she has more than enough clothes to wear already and that $13 could have gone to pay down your high interest CC debt. So it's not exactly MMM kung fu that deserves a pat on the back.

You guys are at an age where there isn't a lot of time left to pay off debts, save and invest before you are forced to retire by something age related.

If you can pay off your debt say in 3 years and start saving say 40% of your after tax income you'll be ready to FIRE in 25 years. In reality SS will kick in and help out so it's not quite that bad.

What I'd suggest is you split up your debt and your incomes so you are tracking thing individually and you can each see what your actions are producing more clearly and have some personal responsibility. You can always take all the debt depending on how it was accrued and the disparity between your incomes so all she has to do is work on getting a 40% savings rate out of her side of things while you work on killing the debt.

If she is living rent free with a paid off vehicle and can't save 40% of her income that will make the prospects for FIRE pretty bleak.

Congrats on getting started with the process. No matter what happens you'll be better off taking some action now than waiting another 10yrs to address your situation.

-- Vik
« Last Edit: April 06, 2015, 07:39:02 AM by Vikb »

pachnik

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Re: Just Woke Up To Discover I'm Drowning
« Reply #44 on: April 06, 2015, 07:48:51 AM »
Congrats on getting started with the process. No matter what happens you'll be better off taking some action now than waiting another 10yrs to address your situation.

+1  This is exactly what you need to keep in mind.  I am so glad to hear your wife is on board now.  This just makes it easier because now you are a team.

Welcome to the journal section too!

netskyblue

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Re: Just Woke Up To Discover I'm Drowning
« Reply #45 on: April 06, 2015, 08:07:13 AM »
IDK why everyone's focusing so hard on the wife's income.  82k is still a crapton of money.  If you're not rolling in excess cash every month, there's a massive amount of cutting you can do.  You could support 2 households on 82k in many places.

Retire-Canada

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Re: Just Woke Up To Discover I'm Drowning
« Reply #46 on: April 06, 2015, 08:13:16 AM »
IDK why everyone's focusing so hard on the wife's income.  82k is still a crapton of money.  If you're not rolling in excess cash every month, there's a massive amount of cutting you can do.  You could support 2 households on 82k in many places.

If they are married and she's wanting seaside spa treatments, hotels and fancy meals while they are hundreds of K's in debt in their 50's she's and they want to FIRE she's going to have to both spend less and earn more.

We aren't talking about to 25yr olds that can invest and grow their money for 30yrs before a traditional retirement age.

-- Vik

netskyblue

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Re: Just Woke Up To Discover I'm Drowning
« Reply #47 on: April 06, 2015, 09:03:27 AM »
IDK why everyone's focusing so hard on the wife's income.  82k is still a crapton of money.  If you're not rolling in excess cash every month, there's a massive amount of cutting you can do.  You could support 2 households on 82k in many places.

If they are married and she's wanting seaside spa treatments, hotels and fancy meals while they are hundreds of K's in debt in their 50's she's and they want to FIRE she's going to have to both spend less and earn more.

We aren't talking about to 25yr olds that can invest and grow their money for 30yrs before a traditional retirement age.

-- Vik

Oh I see what you mean.  Although if you're in your 50s and not most-of-the-way there already, you're probably not going to FIRE.  You're probably just aiming to "retire" at that point.

Blonde Lawyer

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Re: Just Woke Up To Discover I'm Drowning
« Reply #48 on: April 06, 2015, 09:25:25 AM »
I see only one person mentioned your student loans.  Are those your loans or her loans? Even if you are in forbearance, interest is still accruing.  Are they federal or private? Do you have a high interest rate?  You owe a lot of people money but do you still have good credit? If so, you might want to try refinancing your loans.  I would need a lot more info on your situation before I could say if it is a good idea for you or not.

Here is a link to my story about refinancing my loans.   http://www.mystudentloanrefinance.blogspot.com/ 
I realized I retell it so often that I might as well just be able to point people to it.

kathrynd

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Re: Just Woke Up To Discover I'm Drowning
« Reply #49 on: April 06, 2015, 09:30:15 AM »
Wow. Just wow.

How do people get to this age, and have less than nothing?
Just to show you, it is never about how much money a person makes.

For the OP...you have a hard road ahead of you.
To me, it doesn't sound like your wife is on board at all.
She already is homeless, in poverty, and her head is stuck in the sand.

If you and her divorced, what would she do?

For the OP, I actually don't suggest working more hours.
Until the wife is on board, or you divorce, it will be futile.

If you could give us a breakdown of your payments you are currently making
and net income, maybe people would have a better idea of how to help.