Author Topic: Late Starter, Seemingly Limited Options  (Read 12299 times)

no$

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Late Starter, Seemingly Limited Options
« on: April 26, 2015, 08:25:32 PM »
Hello Mustachians,

I'm new to the blog and I've been reading many of the posts for insight into how to handle my money situation but still feel like I can't relate to the examples I've read about. I'll try to make my explanation brief but it will be hard considering how much I have to explain. Any suggestions will be greatly appreciated.

1. I'm 56 years old with no savings account, about $2000 in an IRA I haven't contributed to in years, a lot of bills, and a condo that's underwater and may be impossible to get out of
2. I make about $58K gross yearly but I live in the New York metropolitan area, so the effective salary is probably closer to $28K (based on a New York Times analysis of spending power)
3. I currently owe $182K on my condo but its estimated worth is about $125K. Although I've never missed or been late on payments, Bank of America sold my mortgage to a credit collection company and where I live, creditors have the right to go after me for anything less than the full amount I owe in case I decided to short sell or do some other type of creative selling/financing. That explains my inability to move, in addition to it being hard to find a job just being a bookkeeper.

Now for my expense breakdown.
Income after taxes:        3600.00 + 700.00(wife) = 4,300.00

mortgage                         1334.22
condo maintenance fee   200.00
gas/electric                     50.00
internet                             95.00 (Only one provider in my area so no choice)
car insurance                   109.00 (Just got a new quote- cheapest price)
Gasoline / tolls / parking   220.00 (Drive about 10K miles a year. I live in Jersey City, right over the river from New York)
Discover Card                   200.00 (Consolidated 3 consumer credit card balances with zero interest to pay them off)
life insurance                     67.00
Condo insurance            32.33
mass transit                  143.00 (To and from work. No option, not easy finding work. Last time I lost a job it took 9 months to find work again.)
groceries                          400.00 (3 adults in the household, one going to college full time)
Medical expenses          160.00 (Not covered by insurance)
credit cards                  500.00 (Cancelled cards. Just on payment plan to end cycle. Payments ending in 2016.)
My college loan                  200.00 (Still owe $16K)
Christine College loan      300.00 (Step daughter still in college. $300 is the interest payment so that the payment plan I'm on will be lower by the time she graduates in 2018)
Total                                4010.55


Not sure what other information would be needed for a good analysis, but anyone with suggestions, please ask and I will provide.

Thank you from the bottom of my heart to anyone with helpful suggestions.

Paul

TheFixer

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Re: Late Starter, Seemingly Limited Options
« Reply #1 on: April 26, 2015, 08:50:41 PM »
Welcome to the forum Paul. 

Others will come up with more detailed suggestions, but my first thought is your expenses don't seem terribly out of control, considering where you live.

What about income?  There are 3 adults in your household.  How can the other 2 generate more income to help with paying off debts and getting your head above water on the condo?  You need all the oars in the water & pulling to avoid the rocks ahead....

Peony

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Re: Late Starter, Seemingly Limited Options
« Reply #2 on: April 26, 2015, 08:51:39 PM »
Welcome to MMM. Things will look a lot better for you once those credit cards + Discover card are paid off. Those payments appear to be eating up all of your wife's income.

Can your wife earn more money?

I don't see phones on this list; have you really done an exhaustive accounting of your expenses? Have you thought about budgeting software such as YNAB? It can be so helpful in finding the holes to plug when there just isn't much extra money. Also, very motivating for killing credit card debt.

Good luck on your journey. I am sure others will be posting here with more thoughts.

okits

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Re: Late Starter, Seemingly Limited Options
« Reply #3 on: April 26, 2015, 09:01:50 PM »
Side hustles?  Someone mentioned Elance.com and Scribie.com. You seem to be at a point where every $100 will make a difference.

Is there a spare room in your condo to rent out?

Can your step daughter assume responsibility for her college loan?  When she graduates will she still live with you and DW and contribute to mortgage payment, groceries, bills?

Agree that an easy fix is to increase your wife's income.  What are the details of that situation?

Is there a clear path to higher pay for you if you further increase your professional qualifications? 

Your budget doesn't include entertainment or gifts, clothing or provision for repairs not covered by your condo fees.

Good for you for trying to improve your finances. Some more details would be helpful in understanding what is and isn't possible in your situation.

mozar

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Re: Late Starter, Seemingly Limited Options
« Reply #4 on: April 26, 2015, 09:08:17 PM »
Can you take the cpa exam? Companies are desperate for cpas and there is no ageism. Since you will be working at least another 15 years I think its worth it. You could double your income. I second getting a roommate. It may be a pain but the other option would be to cut off your step daughter. You can borrow for school but not for retirement.

Retired To Win

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Re: Late Starter, Seemingly Limited Options
« Reply #5 on: April 26, 2015, 09:13:54 PM »
Your housing cost is $1566 a month.  That's 36% of your household take-home income.  Too high; even going by the usual lender formula -- which is too generous.  Is there the possibility of taking in a renter?  Or of refinancing through HARP or some other program to lower your monthly installment?

It may be hard to accept, but you really should be shifting that $300 a month student loan payment onto Christine's deferred responsibility.  You need that money to take care of yourself and your future.

And, as others have said, your wife needs to accept that she needs to boost her contribution to the household income, presumably by taking on a more full time job.

Good luck.

no$

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Re: Late Starter, Seemingly Limited Options
« Reply #6 on: May 16, 2015, 09:02:48 PM »
I would to first thank everyone who has contributed their thoughts to my questions. I will try to cover the questions that seemed to come up the most.

  • College Costs: My step-daughter's college payment is just for interest which my wife is paying from her salary. I only included the expense in my budget because we share expenses. My step-daughter goes to college full time and works part time. She pays many of her own expenses; clothing, transportation, supplies, etc. but cannot afford more on minimum wage.
  • Cell Phone: My wife also pays for that bill. It comes out to about $140 per month for 3 of us on a family plan. We didn't go with a pay as you go plan because they don't have plans for communicating with family in all foreign countries. Countries usually covered never include the Philippines where my wife is from.
    *Car: I use my car a lot during the weekends. To not have a car would be a bigger inconvenience than I could bear. Jersey City cannot really be compared to the metropolitan New York area in terms of mass transit availability or convenience. Also, I never had a bike growing up and I've been trying unsuccessfully to teach myself to ride competently. I just don't seem to have the coordination or whatever to get the hang of it.
  • Home: I actually cannot figure out why property values are not more competitive in my area. I live close to a St. Peter's college, near to a newly renovated supermarket, very near to the major transportation hub of Jersey City; the PATH train, I'm right next door to an almost 300 acre park with tennis courts, basketball courts, football and baseball fields, a bike and running trail sectioned off from traffic, and a new public golf range. I'm only going by what Trulia and the other real estate websites give as an estimate. As for being underwater, I already did a HARP mortgage adjustment that lowered my mortgage payment by $300/month but that's the limit. I can't rent because I don't have any rooms to rent out; remember I'm in the New York area. My place is big for New York but it's a closet compared to where many mustachians probably live.
    *My wife is already earning about what I make and that's with no US college degree or a degree acknowledged in the US. She works 7 days a week most of the time and I seriously do not have the energy to work more than I do. (Wake up at 5AM, work from 7AM-7PM, get home at 8PM, go to sleep at 10PM. Also I don't have the almost manic energy most people I've seen seem to have, and caffeine has no effect on my body.)
    * Increase my income. One bill I forgot to mention is my college loan. I still owe about $16K and pay $200/month. I got my college degree in business in 2006. Increasing my credentials would only increase my education debt. With the job situation the way it is, it's a gamble I was afraid to risk.
    * Discretionary Spending: All my clothes are bought by my wife. She will buy something maybe every other month or so and it will be highly discounted from heavily discounted stores, and just to replace clothing that has holes in it, etc. Shoes are replaced about once a year or a little later; again bought at heavy discount. Entertainment is practically nil. I can't remember the last time going out to a movie; I just use the internet for my video needs. Eating out is once a week that we treat ourselves, and at our age if we can't do that I'd rather just die. We also don't smoke or drink or have any other vices.

OneCoolCat

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Re: Late Starter, Seemingly Limited Options
« Reply #7 on: May 16, 2015, 09:14:27 PM »
Your housing cost is $1566 a month.  That's 36% of your household take-home income.  Too high; even going by the usual lender formula -- which is too generous.  Is there the possibility of taking in a renter?  Or of refinancing through HARP or some other program to lower your monthly installment?

It may be hard to accept, but you really should be shifting that $300 a month student loan payment onto Christine's deferred responsibility.  You need that money to take care of yourself and your future.

And, as others have said, your wife needs to accept that she needs to boost her contribution to the household income, presumably by taking on a more full time job.

Good luck.

This.  You can't afford to pay for your daughter college education. 

Spondulix

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Re: Late Starter, Seemingly Limited Options
« Reply #8 on: May 16, 2015, 11:19:37 PM »
You have two basic options if you want to change anything about your situation: increase income, or decrease expenses. You've basically said you can't do anything to increase income.

Your hair is on fire. Have you calculated how long you'll be in debt if you continue the path you're on? I understand saying "it's convenient to have a car for the weekends" or "this is the cheapest internet I can find," but the fact is that you are in a debt emergency. What is more important: not having to work into your 80s, or having a car for convenience on the weekends? The extra $400/month could take YEARS off your timeline of being in debt. The cost of your car is about $2.50/mile - is every trip you make worth that added expense?

Hypothetically, if you had some sort of emergency where you needed to save $7,000 in a year, what changes would you make to get there?

sd85

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Re: Late Starter, Seemingly Limited Options
« Reply #9 on: May 18, 2015, 05:12:12 AM »
I think it would be helpful to list the total household income (you and your wife's) rather than breaking up the expenses between the two of you. If she makes the same amount you do, then there's a large portion of your income unaccounted for.

cerebus

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Re: Late Starter, Seemingly Limited Options
« Reply #10 on: May 18, 2015, 05:57:31 AM »
Income after taxes:        3600.00 + 700.00(wife) = 4,300.00
(why is your wife only listed as contributing 700 of income? I thought she earned what you do).

mortgage                         1334.22
(what's the ETA until you pay that off? Just a thought, what could you get on it in rental if you moved out to a cheaper place?)

internet                             95.00 (Only one provider in my area so no choice) ---- can you not get a slower line or a capped account? There must be some way to lower this.

Gasoline / tolls / parking   220.00 (Drive about 10K miles a year. I live in Jersey City, right over the river from New York) ---- non-negotiable? That's nearly 30miles a day, where are you going?

mass transit                  143.00 (To and from work. No option, not easy finding work. Last time I lost a job it took 9 months to find work again.) --- So where are those 10k annual driving miles going?

groceries                          400.00 (3 adults in the household, one going to college full time) -- not bad at all.


My college loan                  200.00 (Still owe $16K) --- this sounds like a very low repayment. When will that be gone?

Christine College loan      300.00 (Step daughter still in college. $300 is the interest payment so that the payment plan I'm on will be lower by the time she graduates in 2018)  --- as everyone says, this needs to become her debt. Not, let's negotiate and see if we can find a solution - you NEED to get rid of it. She has her lifetime to repay it, you have 9 years till mandatory, non-FIRE retirement. You cannot afford to pay for anyone's anything but yourself.

The_path_less_taken

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Re: Late Starter, Seemingly Limited Options
« Reply #11 on: May 18, 2015, 08:01:02 AM »
Welcome.

And...it's never too late to start.

While there are licenses for some things like in home daycare...there are side hustles from home that don't require one or could fly under the radar.

Teaching Tagalog: people pay $50 an HOUR for a good tutor. Could be done by Skype to avoid transit costs.

Teaching a basic indoctrination class for new immigrants: "these are the steps you need to get a license, rent a home, get a job, enter college...in America".

Dog walking/dog daycare (depending on condo rules I guess, although dog walking is away from the home).

Taskrabbit and related pickup type of work in big cities is supposedly quite lucrative. I live in the sticks and can't comment personally on that but I've seen a lot of blog activity on it.

Doing taxes or bookkeeping on the side for small biz people.


You'll find something.

cerebus

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Re: Late Starter, Seemingly Limited Options
« Reply #12 on: May 18, 2015, 08:20:35 AM »
Welcome.

And...it's never too late to start.

While there are licenses for some things like in home daycare...there are side hustles from home that don't require one or could fly under the radar.

Teaching Tagalog: people pay $50 an HOUR for a good tutor. Could be done by Skype to avoid transit costs.

Teaching a basic indoctrination class for new immigrants: "these are the steps you need to get a license, rent a home, get a job, enter college...in America".

Dog walking/dog daycare (depending on condo rules I guess, although dog walking is away from the home).

Taskrabbit and related pickup type of work in big cities is supposedly quite lucrative. I live in the sticks and can't comment personally on that but I've seen a lot of blog activity on it.

Doing taxes or bookkeeping on the side for small biz people.


You'll find something.

I'm not sure if he has any capacity left for doing extra work. He already does a 12 hour day.

norabird

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Re: Late Starter, Seemingly Limited Options
« Reply #13 on: May 18, 2015, 10:04:47 AM »
Chiming in to reconsider the car. Where are you going with it most weekends? Why do you think you need it? I've had friends who lived in JC carless.

klystomane

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Re: Late Starter, Seemingly Limited Options
« Reply #14 on: May 18, 2015, 10:22:00 AM »
I would to first thank everyone who has contributed their thoughts to my questions. I will try to cover the questions that seemed to come up the most.

  • Cell Phone: My wife also pays for that bill. It comes out to about $140 per month for 3 of us on a family plan. We didn't go with a pay as you go plan because they don't have plans for communicating with family in all foreign countries. Countries usually covered never include the Philippines where my wife is from.

If calling to a foreign country, there are many free wifi/data options nowadays (Skype, Whatsapp, Kakaotalk, etc.). These are completely free, as long as you have a wifi connection.

If she must dial to a land-line, try Google Talk or Skype; their rates are quite reasonable. We use a combination of both and usually reload our GTalk accounts with $10 every 2-3 months.

If you already own your phones outright, look into PTel or something similar; you can go as low as $10 every two months if all you're really using the phones for are wifi and the occasional call.

no$

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Re: Late Starter, Seemingly Limited Options
« Reply #15 on: May 19, 2015, 07:50:42 AM »
New Replies: (Very Long)

OneCoolCat Ė My wife is paying my step-daughterís interest payment of $300/month while her daughter tries to finish school and get in the real work force since all she qualifies to do now is be a cashier and make minimum wage.

Ihamo Ė My wife is actually a nanny and makes a little over $3k/month now. I neglected to give all the information when I first submitted my post. I was trying to be brief in the post as it is not conducive to brevity and Iím not the best at summarizing.
I end up putting close to 10k miles/year on my car because my travel is not out of the country, but to other states. That saves on airfare travel which would end up costing more. Not going on any vacation would be the same as putting me in a mental institution. I only have 3 deep urges in my life, travel, video entertainment (which I get free on the Internet, but not without at least 10mbs speed to do so), and books(which I get for free or at most .99/per on occasion).
Skype only works if the other person has a good internet connection and a relatively third world country like the Philippines does not qualify for that in the region my wifeís family is in. She actually recently worked something else out so we donít need the international plan but there are some other issues preventing us from having a pay as you go plan.
When I said I work in finance, that was my brevity coming into play once again. I work in Citibank, thus the finance reference, but my qualifications would not match up with the finance manager position you so kindly referred to, but I thank you nonetheless.

Spondulix Ė More car facts. My car is a lease so getting out of the lease early would cost me dearly, so thatís not an option. Using one of those services to pass on the lease to someone else is not really an option after I read up on all the horror stories of what happens to screw up those transactions on too many occasions. The only reason I got into a lease was because I was tired of used cars costing me tons of money. Mind you, I did what all the articles on MMM and elsewhere suggest; doing a lot of the maintenance myself, being diligent with tune ups, all the cars bought were vetted by a master mechanic who is the head mechanic of a local dealershipís pit crew, etc. In all cases I ended up with major issues that had the master mechanic and scores of other mechanics shaking their head saying, ďIíve never seen that before!Ē or some such other similar statement. Iím not saying Iím jinxed but I have never had a car that did not cost me a ton of money in repairs after everything I did to make sure I was babying the car and proactively ensuring I wasnít supposed to end up with those problems. And every one of those cars were the ones that ďneverĒ had major problems, such as Toyotas or Hondas in the years when they were considered the best at reliability.

Cerebus - Income after taxes:        3600.00 + 700.00(wife) = 4,300.00
(why is your wife only listed as contributing 700 of income? I thought she earned what you do). See above response to Ihamo.

mortgage                         1334.22
(what's the ETA until you pay that off? Just a thought, what could you get on it in rental if you moved out to a cheaper place?) Mortgage will end 28 years from now because I did a mortgage adjustment HARP 2 years ago to lower my payments by $300/month and that starts the amortization cycle from scratch. If I were to rent I would not be able to get more than $1200/month because that is the going average rate for my size apartment in my city. I would be losing by moving. I canít short sell because New Jersey is one of those states that allows lenders to go after the balance of a short sale and I donít want to gamble that I would be that extremely small percentage of people that gets off scott free. (Just based on historical empirical evidence of my luck with those sorts of things.)

internet                             95.00 (Only one provider in my area so no choice) ---- can you not get a slower line or a capped account? There must be some way to lower this.  The next lower level would not allow more than one computer working at the same time to do more than just surf the internet and send emails. My step daughter is a graphic design student and I LOVE downloading video content. If Iím not going to enjoy anything else in my life, I need to continue to do what I have available to me. I beat cancer two years ago but that experience puts me in a frame of mind of thinking more short term as statistics show cancer can rear its head once more very easily.

Gasoline / tolls / parking   220.00 (Drive about 10K miles a year. I live in Jersey City, right over the river from New York) ---- non-negotiable? That's nearly 30miles a day, where are you going? Those miles usually end up being less than 10k per year but just include weekend trips as explained in my response to Ihamo above.

mass transit                  143.00 (To and from work. No option, not easy finding work. Last time I lost a job it took 9 months to find work again.) --- So where are those 10k annual driving miles going? See above.

groceries                          400.00 (3 adults in the household, one going to college full time) -- not bad at all.


My college loan                  200.00 (Still owe $16K) --- this sounds like a very low repayment. When will that be gone? 2022 at the rate Iím paying. Actually I guessed at the amount before, itís really $12,672 as of May 19th  at 6.75% interest.

Christine College loan      300.00 (Step daughter still in college. $300 is the interest payment so that the payment plan I'm on will be lower by the time she graduates in 2018)  --- as everyone says, this needs to become her debt. Not, let's negotiate and see if we can find a solution - you NEED to get rid of it. She has her lifetime to repay it, you have 9 years till mandatory, non-FIRE retirement. You cannot afford to pay for anyone's anything but yourself. My wife is paying this loan. See more info in above responses.
Capacity for extra work: I couldnít have said it better myself. I wake up at 5AM, start work at 7AM, and generally work until 7PM, get home around 8PM, go to sleep at 10PM. Without either a superhuman or bi-polar manic constitution, I could not physically handle extra work. All my weekend time is taken with just chores. My wife works most weekends.

Norabird: I know there are many people who live carless in Jersey City. In fact, my immediate neighbors are one of them. However, they also donít have the type of life I do. They donít visit friends and donít seem to have visitors, they donít travel to other states, they buy the crap food thatís in our neighborhood (bodegas). I try to make the most of what life I have by doing as much of the things I like to do as possible. That includes traveling to other states since I canít afford to travel to other countries like my ULTIMATE dreams would have me do.

After looking at all the helpful and constructive comments from everyone who has contributed, Iíve come to some conclusions.
ē   My biggest problems are the car and my mortgage. My carís lease will end next year and I plan to get a smaller car with smaller monthly lease payments, but I will still get a leased car. My past history of lemons after doing all I can still haunts me, and I canít seem to do without a car. Just the one thing of visiting my grandson in Staten Island without a car would take about 4 hours of round trip travel, which basically leaves me with one day to do all the chores and ďenjoyĒ my weekends. Riding a bike for someone like me who canít even figure out how to stand up in a bike for handling hills, makes it totally impractical. Iíve been trying to get the hang of a bike since 1998, but either itís because I never rode a bike while a kid or Iím just not coordinated for bike riding; I donít know. My mortgage is extremely hard to get out of as explained before with the laws in New Jersey for short sellers, and the fact that my mortgage was sold to a collection agency even though Iíve never missed or been late with payments, and because I could not get a renter to pay the cost of the mortgage + maintenance to make it worth it. I do plan on doing a bi-weekly payment to at least shorten the length of my loan.
ē   Iíve decided that when I retire, my choice is limited to moving to the Philippines with my wife. She has property we can live in rent free with enough land to grow some food. If Iíve shortened my loan in enough time to lower my mortgage obligations enough to sell my apartment for a small profit, I can use that proceeds to build a small cottage type house on the property to rent out to tourists, Airbnb style, for supplementary income in addition to my social security. Iím from the Virgin Islands so the lifestyle and climate would be very similar to how I grew up.
ē   I wished that when I was younger there was an internet and MMM information out there for me to take into account, or people I knew with this knowledge. I made a lot of mistakes in my life and they are all coming to fruition now. Kudos to everyone on this site who is on the right path. Consider yourselves blessed to be on the path you are on now.

Thank you to all contributors to my post. I will take as much information to heart as possible and try to amend as many of the money drainers as I feel comfortable doing.

mskyle

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Re: Late Starter, Seemingly Limited Options
« Reply #16 on: May 19, 2015, 08:10:55 AM »
Not to keep harping on the phone issue, but you can make calls from Skype to landlines and mobiles. From the US to the Philippines it's 9-12 cents a minute, depending on how much you talk. Might or might not save you money, depending on how much your family likes to talk.

cerebus

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Re: Late Starter, Seemingly Limited Options
« Reply #17 on: May 19, 2015, 08:39:14 AM »
Look sorry to be harsh but you appear to have not the slightest willingness to change any of the factors in your budget where you could save money. You're 9 years from retirement with 22 years left on an outsized mortgage, and you still want to drive your 10k miles a year and re-lease another vehicle next year so that you can 'at least enjoy the few things that you have'?

The reality is, you have nothing paid off, more debt than you can seem to manage even with belt-tightening, and no retirement plans except a slash and burn move to the Philippines. Hopefully that will work out for you.

Bambam100

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Re: Late Starter, Seemingly Limited Options
« Reply #18 on: May 19, 2015, 09:02:50 AM »
I think you will need to start saying "no" to yourself and your loved ones sometimes, and really think about need vs want.  I say this as a favor to you, not in judgement as I personally went through very serious financial difficulties myself 4 years ago.  It takes clear-headed thinking to give up some of these emotional attachments and their accompanying excuse-making.  Like the Handlebar Monsieur, I hate to sound harsh.  How about baby steps?  My first step would be to off-load the loan interest to your stepdaughter, or turn in the car.  Would the lease penalty really outrun the long term cost of continuing with it?  Don't forget, there's also insurance and maintanence to figure in?  You could always rent a car at enterprise if you really need to drive out to the burbs to shop ( plus, you'll organize your shopping better).

Blonde Lawyer

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Re: Late Starter, Seemingly Limited Options
« Reply #19 on: May 19, 2015, 09:36:25 AM »
I don't think you are understanding our replies regarding your step-daughter's student loan.  We are not saying she doesn't need the loan.  We are saying that nobody, neither you, your wife or your step-daughter, need to be making those interest payments while she is in school.  Usually, you don't make those payments and they capitalize and your loan is a bit bigger when you graduate and go into repayment.  We are saying let the interest capitalize and let her have a larger loan at graduation.

russianswinga

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Re: Late Starter, Seemingly Limited Options
« Reply #20 on: May 19, 2015, 09:37:57 AM »
You need - NEED to get rid of that gigantic cell phone bill immediately.
3 lines on Repiblic Wireless or another small carrier - $15/mo X3 = $45/mo
Skype paid phone service for calls to phillipines - likely no more than $10/mo, but it depends on how much you use it. Either way, you can slash your communications bill 3 times over.

In case it hasn't been made clear by the other posters - you don't need skype at both ends. Skype at both ends just makes calls / video free. You need skype on your end, and a paid account with them, from there you can call any number in the phillipines just like you would on your phone, it will be billed per minute, but much cheaper than your cell carrier.
Skype can be installed on smartphones too. So on your end you lose nothing - you can still call from the same phone you've been using. You just pay a lot less.
« Last Edit: May 19, 2015, 09:41:02 AM by russianswinga »

russianswinga

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Re: Late Starter, Seemingly Limited Options
« Reply #21 on: May 19, 2015, 09:55:17 AM »
Here is where I would make immediate cuts if I were you (I'm sorry if these sound cold and not taking your emotional attachment to things into account, but sometimes that's what's needed - the point of view of someone that's not emotionally tied to your situation)
 1. Get rid of the car right now. I don't know your lease return penalty, but you also don't mention what your lease costs. Even if it's as low as $150/month, you will save $1800/year. Likely more.
2. With the car gone, you have no car insurance. 109*12 = Savings $1308 / year
3. With the car gone, there are no tolls / parking. $220*12 = Savings $2640 / year.
4. Get rid of life insurance. YOU CAN'T AFFORD IT, period. 67*12 = savings $804 / year
5. Defer interest your stepdaughter's college loan. There's no reason to be paying a cent on it until she graduates and has a full-time job. 300*12 = Savings $3600 / yr
6. Cell phones - 3 lines on Republic Wireless + Skype paid account for phillipines calls = $50/mo. Savings $1080 / year.
Look, I know nothing about you and I just saved you $11232 per year. Let me spell that out - Eleven thousand two hundred thirty two dollars per year. Can you find decent use for that money to quickly pay down your credit card debt? I think so! Now go forth, young padawan, and use the frugal force to make you life better!

MsGuided

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Re: Late Starter, Seemingly Limited Options
« Reply #22 on: May 19, 2015, 10:27:17 AM »
Hi No$, I hope you keep processing and responding to all the suggestions and face punches you've been getting on this thread. It may feel like MMMers are piling on, but it's b/c they want you to hear about all the ways you can improve your financial situation that you might not be able to see yet.

First, I'll start with a few positive comments. As other commenters have mentioned, your grocery bill is admirably low. Your mortgage seems pretty low considering where you live. And, although I sense a little (understandable) fatalism in your tone, you definitely don't seem bitter or prone to blaming others. Your attitude is crucial, so you're already in a good position there.

You also mention that you don't have the incredible energy that some of the MMMers on this forum have. Some people read the MMM forum and within a week implement changes and are on their way. But that's not the only way to success. I encourage you to take in the philosophy and specific suggestions and think of one thing you are willing to sacrifice to save money. Maybe it's the phone service a bunch of people suggested you could get for less (that sounds like really good place to start to me) or telling your stepdaughter she's going to have to take on all the responsibility for her education (I'm sensing this might be a little more complicated relationally than in appears at first blush--maybe your wife feels it's a parental obligation or you both promised her this help). Whatever it is you decide to take on first, just taking that first step is powerful.

I understand you feel like there's nothing you can do (I felt that way years ago, before MMM existed and my DH and I owed over 100k in student loans and knew absolutely nothing about finance and came from families lacking financial knowledge and skill), but there really is hope. And the options will become clearer the more you learn and open up to new ways of thinking about your future.

Please stick with us, No$. And, if you feel inclined, let us know the one thing you think you can cut/change and designate that savings to pay down your CC immediately.

BTW, my DH and I did pay off that debt, learned a lot. Now, I feel like one of the people I never thought I could be, one who has money working for me rather than a slave trapped in a box I couldn't figure out how to escape. That really can be you, too. It's NOT too late.

frugaldrummer

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Re: Late Starter, Seemingly Limited Options
« Reply #23 on: May 19, 2015, 10:57:21 AM »
I agree with everything Russianswinga says EXCEPT for cutting out the life insurance.  Either you or your wife would be in al ot of trouble if the other died, so if you can keep the insurance, I would.  DO shop around and see if you can get a better deal - perhaps a "first to die" policy that pays only on the first one of you to die, either you or your wife?

Also - I still don't understand why, if your wife makes $3k per month, you only list her contribution to the budget at $700/mo??

Rubic

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Re: Late Starter, Seemingly Limited Options
« Reply #24 on: May 19, 2015, 02:05:08 PM »
Also, I never had a bike growing up and I've been trying unsuccessfully to teach myself to ride competently. I just don't seem to have the coordination or whatever to get the hang of it.

Resource link: http://www.bike.nyc/education/classes/learn-to-ride-adults/

no$

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Re: Late Starter, Seemingly Limited Options
« Reply #25 on: May 19, 2015, 03:25:59 PM »
I think I needed a kick in the head Cerebus. Getting it all laid out in simple bullet points really hit my sweet spot, Russianswinga. And thanks to everyone else for their contributions. (Thanks rubic, I will be signing up for bike classes.)

I tried to lower my life insurance about 3 years ago and that's when I found out I needed more testing that led to the discovery of my cancer. Even though I beat the cancer for now, that pretty much nullified my ability to get a good insurance rate. I have a daughter and brothers and I would not want to put the cost of my cremation (the cheapest option and my first choice), on their shoulders, which is why I was keeping the insurance. There's no Obamacare that I know of for insurance so my preexisting condition prevents me from getting life insurance from another company, (I tried already).

I will start with the phone and college loan interest and work my way up to the car. The lease is very hard to get out of because my lease ends in October 2016. The termination fees come out to many thousands of dollars.  I also found out that Hyundai does not allow lease transfers so I don't have that option available to me either. Selling the car won't work either since it's not worth more than I owe so I would still owe a few thousand dollars. At worst I can stick it out until next year and then go carless.

Meanwhile I'll be taking bike classes and looking into the best car renting options for those times I need a car later. I will also be saving with the phone and college loan and anything else I can figure out, like the bi-monthly mortgage payments I will be setting up to lessen my mortgage term. I expect to be a lifetime member of this website so I will continue to learn and apply more insights.

Thanks again everyone!

russianswinga

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Re: Late Starter, Seemingly Limited Options
« Reply #26 on: May 19, 2015, 05:22:18 PM »
No$ - coming back to life insurance - if ALL you care about is cremation, and not leaving behind 50K/100K/500K/1M in case of an untimely death... you're in luck! One of my clients (I'm in IT) is a crematorium (yes, even ovens are run by computers these days).
A no-frills cremation costs $999. Yep, One Thousand Dollars. My client is California-based, invocares.com, but you can contact them and see if they'll connect you someone in NYC so you can comparison-shop.
Less than a year's worth of life insurance put into a separate savings account will take care of your cremation. Once that's saved - the rest can go towards debt repayment ad getting ahead.
Good luck!

Bambam100

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Re: Late Starter, Seemingly Limited Options
« Reply #27 on: May 19, 2015, 06:03:51 PM »
Everyday I drive past a billboard on the highway- Cremation $895. 

It can be done!

Bambam100

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Re: Late Starter, Seemingly Limited Options
« Reply #28 on: May 19, 2015, 06:06:44 PM »
Hey, No$,

Keep us posted.  We're all here to help.

Rubic

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Re: Late Starter, Seemingly Limited Options
« Reply #29 on: May 19, 2015, 07:03:11 PM »

I have a daughter and brothers and I would not want to put the cost of my cremation (the cheapest option and my first choice), on their shoulders, which is why I was keeping the insurance.

Even cheaper than cremation (and my personal choice):  http://medcure.org/

cerebus

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Re: Late Starter, Seemingly Limited Options
« Reply #30 on: May 20, 2015, 12:21:03 AM »
I think I needed a kick in the head Cerebus. Getting it all laid out in simple bullet points really hit my sweet spot, Russianswinga. And thanks to everyone else for their contributions. (Thanks rubic, I will be signing up for bike classes.)

Oh haha I was worried I had been too strong. You have a great attitude about all this. I think the Philippines move is actually a pretty good idea, which means that I guess the best thing to do would be to focus on getting out of debt, selling off that house when you get out of negative equity, and pouring every extra penny you have into investments so that you'll have some money to subsist on. I forget now, do you actually have a 401 or any other form of retirement savings at present?

Roses

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Re: Late Starter, Seemingly Limited Options
« Reply #31 on: May 20, 2015, 01:26:38 AM »
Moving to the Philippines sounds like a great plan!  I have to reiterate what everyone already said about Skype.  I use it to chat with family in third world countries and it works great even when they don't have internet.  So definitely get on that and switch to a cheap cell phone plan.  Also, I hear there are great apps for free texting to other countries, but I haven't used them myself.

As for the stepdaughter's loan, you do understand that you aren't required to make any payments until after graduation, right?  Even then, there is a 6 month grace period.  No reason at all to make those payments now.  Let her start to pay it down once she's out int he workforce.  That's what most kids do.  It's their expense and it might make her think hard about what career to get into and, most importantly, about her own personal finances

Good luck!  Sounds like you're making great progress.  Keep us posted

Kaminoge

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Re: Late Starter, Seemingly Limited Options
« Reply #32 on: May 20, 2015, 10:20:47 AM »
So glad to see the change in attitude! I think it takes a while to come around and hopefully the suggestions made and the numbers people have laid out will inspire you.

I'll just add to all the people saying you don't need the cell phones. I've lived overseas for decades and I regularly call home (to people who don't even have a computer at times) and I've always used things like Skype. So much cheaper even when you're paying.

I'm especially glad to see you saying you'll go carless. That will make a MASSIVE difference to your financial situation (even if you can't make the change for quite a bit) and I think you'll find, after a bit of adjusting, that you can find ways to do some of what you want without the car. I've got a car now for the first time in over a decade and it's so much cheaper to live without one. Next job I definitely plan to go car free.

MMMaybe

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Re: Late Starter, Seemingly Limited Options
« Reply #33 on: May 20, 2015, 09:47:47 PM »
I also have some questions about your wife's contribution to the family budget. I suspect her salary is largely going to the Philippines. I do currently live in the Philippines so I am well aware of the pressure that relatives here put on their "rich" relations abroad.

But you cannot afford this and it is causing you significant stress. Talk to your wife and see how she can manage expectations with her family at home.

This needs to change ASAP and she needs to be putting an equitable amount into household funds. You can cut all kinds of things as mentioned by others but upping available funds will go a long way to giving you more breathing room.

Retiring in the Philippines is a reasonable idea but I would keep your place in the US. As a foreigner, you can't own property here and it puts older husbands into a vulnerable position sometimes, if say, their wives decided to end the marriage. Unfortunately not uncommon here :(

Dicey

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Re: Late Starter, Seemingly Limited Options
« Reply #34 on: May 20, 2015, 10:20:40 PM »
Hey, No$, I'm going to take issue with you on the bi-weekly payments. I didn't see an interest rate mentioned, but since you did a HARP re-fi, I'm guessing it's pretty low. Pre-paying a cheap loan at this point is stoopid. Next, STOP obsessing about the "fact" that your place is underwater. You have to live somewhere and in time, the value will return. It's not like you're in BF Nowhere and you don't need to move any time soon, so let it ride. You need to save money now and pay off your other debt, not pre-pay a cheap home loan.

For now, worry about cutting your expenses, but be brutally honest with yourself. If you get rid of the car and then can't go anywhere, I suspect it could have an adverse effect on your psyche, primarily because you work so much. Let the lease expire and then get something more economical. Do not shoot yourself in the foot, but find every reasonable opportunity to save.

I think living in the Phippines post-retirement could be a great option for you. Until then, look for ways to earn more at the job you have. Make yourself promotable by virtue of working smart and positive attitude, not by getting more expensive education.

Take advantage of every retirement vehicle (with catch-ups for being over 50) available to you. This is as important as paying off your debts. You do not have time for your money to accrue much interest, so using your dollars to pay down cheap money like a home loan does not make much sense.

You really can do this if you make up your mind to. It's not too late.

P.S. Have you checked to see what your SS $ will be at age 67? It might be more than you think.