Reader Case Study - Gargantuan Family

[CentimentalFreedom]

Dear Mustachians,

I need help. I always thought that I was the frugal type then I came across this forum and realized that I was clearly deceived by my impulse spending and self-victimization. Good news is that it's all for my family members. I have somehow convinced myself that EVERYTHING is a need: clothes, tutoring , extra-curricular activities all for my children.  My hair isn't on fire anymore, in fact, it's been burnt to a crisp. Here's the financial situation:

I have a Canadian family of 7 and 2 dogs living in a 3 bedroom house with just our beds (no fancy bed sets, just box and spring. There is a $70 bunk bed I bought off Kijiji that the kids share. ), a dresser, a love seat, and a dining table.. Our car is breaking down (so far we've spent $1200 a year on it JUST FOR REPAIRS) so we want a new car, don't know what kind to get for the size of our family. We have a meretricious tenant living downstairs that we want to get rid of (like now, because I want to beat him with a mace then drive over him a couple billion times with my already inefficient minivan. That horrible, horrible grump is really stressing me out). Finally, I want to quit my second job so that I can spend time with my family... maybe retire? On average, I spend about an average of 10 hours a week with my kids... how depressing is that? Bad mother. I know, but what else can I do. There's no money. I am sick of debt. I am sick of restrictions.

Wait! There's more!! I can't say no to Granny. It's been ingrained in me that it's a no-no. Add the guilt trips and constant rants you'll get a tyrant that spends A LOT of money that I don't have. Mostly on food, but the problem is she "buys a fancy pen before she learn's how to write" I hope that makes sense. Is that even how you say it? The Mr. is going to laugh at my sad attempts again. OK... so... the finances...

Income:

$1192 bi-weekly The Mr.
$250   bi-weekly The Mrs. (Part-time, this is an estimated average and is very dependent on how many shifts I work. Usually, I try 2 shifts a week on my days off with my other job.)
$1095 bi-weekly The Mrs. (Full time, does not fluctuate)
$  500 Basement Rent (Will likely disappear if I could I have my way)
$350 monthly for Child Tax Benefit (for the kids anyway)

$5805 approx. net monthly income

Monthly Fixed Expenses:

$1300.00 Mortgage (Current balance: $165,300 at 3.59% - 7 year term)
$82.00 Internet Bill (Super Fiber Op!)
$146.00 Car Insurance (locked in for a year, will re-evaluate in October)
$7.99 Netflix
$325.00 Phone Bill (having trouble letting this one go because it's a SUPER PLAN with all inclusive everything and 6 gigs of data.)

3 phones (one for granny, one for me and one for the Mr: all unlimited talk/text/North American wide calling... voice mail, caller ID, 6GB data. It's a grandfathered plan and I am STRUGGLING with letting them go.

$1861.00 Total

Monthly Variable Expenses:

$440.00 Electricity (Varies based on usage)
$100.00 Water and Sewer (Varies based on usage)
$650.00 approx. Food (Not bad for a family of 7 right? ...  oh dear, the Mr said that I was pushing it close with this budget...)
$450.00 approx. Gas for Car *Crying like a baby*

$1640.00 Total

Other Expenses:

$1000 estimated to date on car expenses (oil change, maintenance, tire popping, winter damages, etc.)
$200 estimated to date on clothing for kids and granny
$300 estimated to date on all things puppy oriented (except food, which is combined with food budget - I wish i found MMM BEFORE I got the dogs)
$400 estimated to date eating out/movies/birthday cakes...etc..etc..etc... had a super expensive meal at the KEG as a going away thing for a colleague and granny had a stroke so no one felt like cooking (I know, I know... it's changed since then)
$300 estimated to date on medication (granny's old age problems, niece has eczema)
$500 to date on moldy basement windows (some expenses to come during Spring/Summer for installation and new side light and front door also due to mold)

Total: $2200

Liabilities:

$13,675 Credit Line 3.9%  (Previously $ 7,800.00 Credit Line at 9.99% and $7,600.00 Credit Card at 11.99%)
$0 (Previously $ 1,000.00) Credit Card 11.99%
$500 (Previously $1,200.00) Tax Bill

$14,175.00 Total Debt (I hear doom creeping around my bubble slowly sucking what life i have left out of me *Jaws theme playing in the background*)

Assets:

$1000 GIC - 1 year @ 1.3%

$14,830 The Mrs' RRSP
$4,325   The Mr's RRSP

I do have employer RRSPs and balances for my husband's RRSPs... will update post with info when I get home.

Total Savings: $20,555

Stuff:

2002 Dodge Caravan - I bought it CASH! YAY, me! Worst purchase I ever made, now it's just a money guzzler.

Brother - unemployed, in school - is looking for a job
Mother - does not have ability to contribute and, due to some antiquated cultural beliefs, I don't really want to take money from her (buys groceries that she wants on occasion)
Niece - has eczema and asthma, medical bills cost a fortune - mother pitches in where she can (I don't factor this in, what I get is a bonus)
Son (5)
Daughter (2)

The Tenant uses the vehicle on occasion, most of the time it is commuting between jobs and there are occasions when bro takes the kids out swimming and such while he is at home. Free babysitting and home cook because of the amount of people at home.

Energy problem possible cause: Mom does a few loads of laundry a day - it keeps her busy. I have tried on multiple occasions to get her to stop. I really don't have the energy to trigger another nuclear bomb. I feel like there's a ghastly alien hornet's nest floating around my home controlled by dragon lady. All lights in the home are the energy efficient ones thanks to the Mr. I noticed that my water heater was old so I called the power company, they will replace it this year.

To be a little more detailed according to my statements in the last 3 months, I have spent...

$822 on dining out (McDonalds, Starbucks, etc.)
$350 on gifts
$192 on books and board games (including shipping from US to Canada - never doing that again)
$300 on hobbies (I bake...a lot...)

$1564 Total wasted money in the last quarter.

Mustachians were right... it's an eye-opener... all of these expenses will STOP completely, no excuses.

The reason there really aren't any other costs are because the kids usually get gifted clothes for their birthdays. I RARELY need to buy clothes. Most of the spending has been on my niece so far but that has stopped because she's gotten what she needs. I cut EVERYONE's hair (thanks to YouTube for the certificate ;)).

We live:

Approx. 4 KM from my part time job. (I have tried to walk this, takes my about an hour. I have short legs, deal with it. I do intend to walk more in the summer.)
Approx. 7 KM from my full time job. (I intend to buy a bike for this... well keep you posted)
Approx. 11 KM from the Mr's job. (Good luck trying to convince him to bike that)
Approx. 2 KM from Costco and Superstore (We decided to walk this in the summer and if all goes well we'll do it in the winter... Good luck spending money Granny... MUAHAHAHAH)
Approx. 3 KM from Walmart Supercentre

We do not live in a bike friendly neighborhood, but at least I chose a home purchase located within walking distance EVERYWHERE (except for outdoor entertainment like hiking, camping, fishing, beach, etc).

I need a new car and want to know what you think I should get to help my family. Also, maybe tell me where I can improve since I am SURE there are improvements that can be made. Thanks for your time.

Update

March 23, 2014   Spoke to husband, we are walking everywhere once the Summer months start. I am looking on Kijiji for bikes. Went through the plans. I didn't mention that when I begrudgingly moved to New Brunswick from BC, I refused to change my phone numbers - hence the $20 unlimited NA wide calling. It's my connection to home I have left. Even now, going through the plan I don't see it. Mom's plan is only 50 unlimited everything. It's the two other plans that I really need to go through.

March 24, 2014   A thought just crossed my mind. I'm with FIDO, can't I just keep the 6 GIGs and use Skype (voice) and Facebook (text/video) ... ?!?!?!?! What do you guys think!?!

March 28, 2014   I FOUND A SOLUTION TO THE PHONE PROBLEM!!!! SKYPE They have unlimited calling to any other Skype user and if I needed to, I can have a Skype phone number AND unlimited calling for less than $20 per month. Now, how's THAT for learning, Mustachians?!?!?!?! Took at $300 phone plan down to $50 per month (need to keep data to use Skype) I've already apply for the free one. Next step, call the phone company!!!

April 03, 2014   CREDIT CARD DEBT GONE  wooohooo!!!! Someone told me about MagicJack... so deciding between Skype and MagicJack.

April 20, 2014   Spoke to bank yesterday and I was able to DECREASE my interest to 3.9% !!! Also, looked at bike costs, going to pick one up at Walmart for $78!!!

[parkette]

Well done on posting and putting yourself out there. It takes some guts and I'll admit I haven't done it myself yet!

There seems to be a lot of information missing on the expenses side of things. You list about $3,500 worth of expenses but you're missing things like clothing, extra-curricular expenses, car maintenance (you mentioned $1,200 repairs/yr), entertainment, health costs, house maintenance/improvements... Providing these figures (or at least an estimate) will provide a better picture of where you're at, what can be cut and how much of a surplus or deficit you have.

Is that a full list of your liabilities? Your cars aren't listed.

That phone bill is absolutely insane! How many cell phones are you paying for? Can you use wifi more/cut down on watching videos on data and so on? Personally I use around 100mb a month by being careful about what I use my data for and using wifi wherever possible. Wifi is available more widely than you would think; I find it at the grocery store, home stores, etc.

[CentimentalFreedom]

Thanks, Parkette!

I have updated the posting with the estimated numbers that you recommended!

3 phones, all unlimited talk/text/North American wide calling... voice mail, caller ID, 6GB data. It's a grandfathered plan and I am STRUGGLING with letting them go.

[lentilman]

Well, you have a great income!  But if I am reading your post correctly, you have a negative cash flow every month: 5455 (income) -1861 (fixed expenses) -1640 (variable expenses) -2360 (debt repayment) -700 (est/month, other) << 0.

Does the $450/mo gas refer to natural gas for heating or gasoline for your car?  Either way it's high, but if it's gasoline you could knock it WAY back since you are close to everything.

The phone bill is off the hook.  Are your kids old enough to earn their own phone money?  If not, do they even need a phone?  What about just having a landline?

Focus on killing off that debt.  It's eating you alive. 

[zolotiyeruki]

With regard to the cell phones, I have a couple thoughts, having just "downsized" my cell phone bill:
1)  How much data do you *actually* use each month? I know on most phones, you can track how much data you've used.  I figured out that I was only *using* about 100MB each month, even though I had an unlimited plan.  I spend most of my time either at work or at home, and have wifi at both places.
2)  At the least, you could switch to a service like Airvoice, which has unlimited plans starting at $30/mo.  I'm on the "$10 for 250 minutes or 500 texts" plan, and one side "benefit" is that each time I send or receive a text or phone call, it tells me how much I just spent and what my balance is.  This encourages me to use it only when I actually *need* to.

[Thegoblinchief]

I'll respond with GOOD and BAD

GOOD

-Food budget is quite good for your family size.

BAD

-Utilities is insane. Unless Canadian utility costs are much higher than American, your usage is off the hook. Thermostat at 17C in winter, 27C in summer. Lights to CFL/LED. Pay for an energy audit if necessary. In US, it's typically $200-300 but lots of people consider that money well spent.

-Cell phone is ridiculous. I don't care what your plan is like. Learn to do without it. In US, all 3 phones could be on a $20-30 plan per phone for minutes when needed, unlimited texting, and data when needed. Learn to love Google Voice (wifi calling).

-Fuel expenditure for vehicles is also insane, considering your commutes are quite short. What extra driving are you doing? All of your travel is easily bikeable. The husband's 11K is also very easily bikeable. I'm the worst person to look towards for pity about a non-bike friendly city ;)

ADVICE

- Depending on your equity in the house, I'd look at doing a cash-out refinance to consolidate the high interest debt. Make sure to run numbers, but you should be able to find a deal to save money.

-Consider replacing the car when you have some cash breathing room, but $1200 a year in repairs isn't actually all that bad for a car that age. There's basically no options for more efficient vehicles that can transport that many folks, but a Toyota or Honda minivan will on average be considerably more reliable than the Caravan.

-Give yourself a SMALL discretionary budget for random purchases. Once that runs out, oh well, can't buy anything.

[CentimentalFreedom]

Well, you have a great income!  But if I am reading your post correctly, you have a negative cash flow every month: 5455 (income) -1861 (fixed expenses) -1640 (variable expenses) -2360 (debt repayment) -700 (est/month, other) << 0.

Does the $450/mo gas refer to natural gas for heating or gasoline for your car?  Either way it's high, but if it's gasoline you could knock it WAY back since you are close to everything.

The phone bill is off the hook.  Are your kids old enough to earn their own phone money?  If not, do they even need a phone?  What about just having a landline?

Focus on killing off that debt.  It's eating you alive.

You're right, I am running a negative cash flow.

It refers to my car. I am hoping that by walking in the Summer it'll cut the costs, although I am unsure of the other family members.

No they're all under 10 years. They don't have phones, I've updated the posting with who the phones are for. Maybe they don't? I guess granny doesn't need one. Although, I am attached to the plans themselves. I will look into a land line.

As for the debt, you're absolutely right. I have been putting as much as I can towards it.

[CentimentalFreedom]

-Utilities is insane. Unless Canadian utility costs are much higher than American, your usage is off the hook. Thermostat at 17C in winter, 27C in summer. Lights to CFL/LED. Pay for an energy audit if necessary. In US, it's typically $200-300 but lots of people consider that money well spent.

-Cell phone is ridiculous. I don't care what your plan is like. Learn to do without it. In US, all 3 phones could be on a $20-30 plan per phone for minutes when needed, unlimited texting, and data when needed. Learn to love Google Voice (wifi calling).

-Fuel expenditure for vehicles is also insane, considering your commutes are quite short. What extra driving are you doing? All of your travel is easily bikeable. The husband's 11K is also very easily bikeable. I'm the worst person to look towards for pity about a non-bike friendly city ;)

ADVICE

- Depending on your equity in the house, I'd look at doing a cash-out refinance to consolidate the high interest debt. Make sure to run numbers, but you should be able to find a deal to save money.

-Consider replacing the car when you have some cash breathing room, but $1200 a year in repairs isn't actually all that bad for a car that age. There's basically no options for more efficient vehicles that can transport that many folks, but a Toyota or Honda minivan will on average be considerably more reliable than the Caravan.

-Give yourself a SMALL discretionary budget for random purchases. Once that runs out, oh well, can't buy anything.

Well, We have people who leave their computers on all day including the tenant. I will look into the light bulbs and will invest. The hot water heater is rented through the power company at a rate of 6.14 per month and $10.05/Kwh (last month the family used 4356 kwh as a whole)

I will talk to husband about cell phone plans today and... well... learn to do without... trying not to be a whiny pants. we'll look at our cell phone usage as well and downgrade our plans.

So far, I am embarrassed to say that we drive EVERYWHERE. We have talked about walking and, knowing that it's only an excuse, I will try to bike... with everything being uphill that will be difficult but if anything I can walk. It's a lot easier said than done... especially with the Winters here but I am hoping that by the time next Winter comes along, I'll be able to bike despite the weather.

Unfortunately, we got the mortgage in June 2013. So there is very little equity built.

I think that the car will last us another year so I will continue to put everything towards my debt.

[Spudd]

I don't know where you live, but check out start.ca or teksavvy.ca for internet. $82/mo is too high. I pay $45 all-in with start.ca and that includes 150gb of data and 25mbps speeds.

You NEED to downgrade your cellphone plans. That's just nuts. Are your phones paid for (i.e. have you had them >2 years)? If yes, you could look at going to pay-as-you-go. Or moving to a different provider such as Wind, if they exist in your area.

Right now, you're spending more every month than you're bringing in, and that's not sustainable.

[arebelspy]

The Mad FIentist recently posted about a family with 13(!) kids.

You may find it helpful/inspirational: http://www.madfientist.com/how-to-retire-early-with-13-kids/

[CentimentalFreedom]

The Mad FIentist recently posted about a family with 13(!) kids.

You may find it helpful/inspirational: http://www.madfientist.com/how-to-retire-early-with-13-kids/

Thanks! Will take a look!

[MDM]

Family of 7 here also (but no dogs).  Don't know about yours, but our Caravan problems were with transmissions.  Got a used Honda Odyssey in 2006 and nothing but routine maintenance ever since (knock on wood...).

The logistics of getting 7 people where and when they need to be, even with minimal kids' activities, can be daunting so I'll give you a pass (for now) on the car fuel usage.  Time is valuable - you need to spend time budgeting, etc.

Sell the dogs.  Even pay someone to take them.

You aren't actually talking or texting on those cell phones while you are driving - are you?  We get by with one cell phone (~$25/mo) between the two adults without any problem.  Kids got cheap cells in ~high school.  As they grew older (and bought their own), younger siblings got the hand-me-down phones.

$440/mo in electricity is a lot more than just computers on all day.  I agree with prior suggestions to get an energy audit and figure out your big uses.

Only $1300/mo on mortgage?  Is there a balloon payment due in 7 years?  It's $2,228/mo for $165,300 at 3.59% over 7 years.

Yes, you have a hill to climb.  But you have a good income and it is doable, one step at a time, if you take the right steps.  Good luck, and let us know how things go as you make changes.

[CentimentalFreedom]

Sell the dogs.  Even pay someone to take them.

You aren't actually talking or texting on those cell phones while you are driving - are you?  We get by with one cell phone (~$25/mo) between the two adults without any problem.  Kids got cheap cells in ~high school.  As they grew older (and bought their own), younger siblings got the hand-me-down phones.

Only $1300/mo on mortgage?  Is there a balloon payment due in 7 years?  It's $2,228/mo for $165,300 at 3.59% over 7 years.

Yes, you have a hill to climb.  But you have a good income and it is doable, one step at a time, if you take the right steps.  Good luck, and let us know how things go as you make changes.

Thank you so much!!

The dog thing, I am going to struggle with that.

The cell thing, I am going to talk to my husband right away and will update everyone.

Double-checked my mortgage... no balloon payment, it's 1300... i'll have to refinance at the end of 7 years.

[annann]

Re your Mortgage.

The need to refinance in 7 years is the definition of a balloon payment.  You do not have a fixed year mortgage.

[CentimentalFreedom]

Re your Mortgage.

The need to refinance in 7 years is the definition of a balloon payment.  You do not have a fixed year mortgage.

Oh. oops...

[process]

Just want to say I understand how you feel about the phone plan.  I too have a grandfathered-in unlimited data plan for my three phones (mine and children's.)  It cost $185/month, which I know is high, but I am really reluctant to let that unlimited data plan go...  I don't really understand how other people use so little data. 

I did get my phone bill down a bit a couple of months ago though; it used to be $212/month but I lowered the talk minutes as we weren't using that much.  Can you do something like that? 

[scottishstubble]

Quick thought. You're earning roughly $500 a month in your second job. Mucho respect. However, you're spending much of that on your cell phones and internet. Is it really worth being consistently knackered and regretting not spending time with your family just to surf the net? I appreciate responding to an online forum shows that I'm doing just that but you need to do it much more cheaply or not at all. If you do want that extra money, would it not feel great knowing it was going towards one if your credit cards or other debts?

All the very best.

[Catbert]

You mention "granny" and a "niece" when discussing your expenses.  Are you supporting both of them?  Doesn't granny (your mother? grandmother?) get a pension of some type that can either support her expenses or go into the communal pot?  If your niece lives with you can't you get some type of support either from her parents or the government.

I agree with everyone else about the need to downgrade your cell plan.  Does Granny really use a smartphone?

[alittlebirdie]

Canadian family of 7 here as well (Ontario though). If all of your children are under 10 I am thinking you must qualify for some type of child tax benefit. (unless the 7 includes granny and niece?) I am going to echo everyone else and say the cell phone bill is insane. We have Rogers and pay $120 a month for two phones under a grandfathered plan (only 2gig) Even my plan cost makes me sick to my stomach. When our contract is up in December I will be going with Koodo pay as you go. $15 a month for unlimited texting and then buy boosters that don't expire for minutes and data. Your gas bill also seems high since you live so close to work. I believe your gas may be more in NB (here right now we are roughly $1.24-$1.30 a litre). Even so my husband commutes 30km each way daily, we have two vehicles and our monthly gas is $300 a month (that is what we budget and we are usually a little bit under that). Grocery we are at $500 a month but one of our 7 doesn't eat solids yet. We make everything homemade - saves lots. The electricity I can't speak for as we have gas heat and a gas stove. I will say that we cut our daily average from 40kwh a day to 20 kwh a day just by making sure computers were turned off, limiting other electronics being turned on - a lot of times it is just mindless stuff that makes the bills so high. When you start making a conscious decision to lower consumption you can find lots of ways to lower that bill.

[Christiana]

$1200 a year in car repairs is still less than the payment and repair costs on a newer car.  So I would count the Caravan as a win for now, while planning to replace it eventually with an older Honda or Toyota.

Would it help to set Granny an allowance that she can spend however she wants?  (A limited amount of Yes surrounded by a Wall of No.)  Also, you didn't mention whether she's making any contributions to the household in help or money, but hopefully she is in some way an asset.

You said you had very little furnishings, etc. at home.  The Mustachian way is to make your home pleasant and very livable, and to have an active home life, so that you aren't tempted to get in the car and drive to other places to spend money all the time.  With your two jobs, you're not home much, but others in the family are.  What does your family need to be comfortable and profitably occupied at home?  And where can you get those things inexpensively?

I'd also try to be more stoic about the tenant; protect your emotional space. 

[MDM]

CentimentalFreedom,

First, sorry for any USA-based terms (e.g. the taxes) in the table below.  But you would need to adapt and add details if you want to use it (copy&paste into a spreadsheet, add formulas) anyway, so....

You definitely get accolades for paying down the CC debt, but unless you start saving in other areas (e.g. the already discussed phones) it appears you will quickly run out of cash to make extra CC payments.  In this situation you should understand in great detail (e.g., so "miscellaneous" is only ~1% or so) where your spending goes.  You may know this already but it isn't clear from your posts.

You do have the rental income so that helps for now, but as you said that may go away so it is ignored below.  Add back if needed.  Converting your "other expenses" to numbers below was also a guesswork.

One last attagirl: extra points for good vocabulary (meretricious).

Category	Monthly amt.	Comments	Annual
Salary/Wages	$5,455		$65,460
Other income (int., div., etc.)	$0		$0
Federal Adj. Gross Inc.	$5,455		$65,460
Federal tax	$242	2014 rates, std. ded., 7 exemptions	$2,904
State/City tax	$0		$0
Soc. Sec.	$338		$4,059
Medicare	$79		$949
Total taxes	$659		$7,912
Income before other expenses	$4,796		$57,548
Monthly Expenses:
Mortgage	$1,300	Balloon due in 7 yrs	$15,600
HOA			$0
Property Tax			$0
Home/Rent Insurance			$0
Bicycle Maintenance			$0
Cable TV			$0
Car Insurance	$146		$1,752
Car Maintenance, Registration, etc.	$100		$1,200
Child activities (lessons/scouts/sports/etc.)			$0
Childcare			$0
Clothing/Shoes	$50		$600
Computer (paper/software/etc.)			$0
Credit card fees			$0
Dental Insurance			$0
Dentist			$0
Dining (Pizza, Restaurant, etc.)	$100		$1,200
Donations/Gifts			$0
Electricity	$440		$5,280
Entertainment	$8		$96
Financial Planning			$0
Fuel/Public Transport	$450		$5,400
Gas/Oil			$0
Groceries	$650		$7,800
Hair Care			$0
Household; Maintenance	$100		$1,200
Internet	$82		$984
Landscaping/Yard work			$0
Life Insurance			$0
Medical (Doctor, Hospital, etc.)			$0
Medical Insurance			$0
Medicine (OTC + Prescription)	$100		$1,200
Miscellaneous			$0
Pets	$100		$1,200
Phone (cell)	$325		$3,900
Phone (landline)			$0
Recycling/Trash			$0
School Tutition/Books/Etc.			$0
Sports/Recreation			$0
Subscriptions (paper/magazines/etc.)			$0
Travel/Vacation			$0
Water/Sewer	$100		$1,200
Wine/Beer			$0
Work/Professional fees			$0
Loans:			$0
Credit Line	$867	Higher than Excel PMT	$10,400
Credit Card	$1,083	Higher than Excel PMT	$13,000
Credit Card	$100		$1,200
Total Expense	$6,101		$73,212
Available to invest	($1,305)		($15,664)
Loans	Current	Original Prin.	Rate	Orig. Length	Excel PMT
Credit Line	$8,000	$8,000	9.99%	1	$703.29
Credit Card	$8,000	$8,000	11.99%	1	$710.75
Credit Card	$1,000	$1,000	11.99%	1	$88.84
Mortgage	$165,300	$165,300	3.59%	7	$2,228.39
Liquid Assets:
GIC	$1,000
Various savings	$661
Total cash savings	$1,661
RESP	$2,642
RRSPs	?
Rollover IRAS	$0
Roths	$0
Total Investments	$2,642
Fixed Assets
House	$206,625	Assuming value at Mtg. principal / 80%
Car	$1,000

[plainjane]

Re your Mortgage.
The need to refinance in 7 years is the definition of a balloon payment.  You do not have a fixed year mortgage.

In Canada (where the OP is) practically everyone with a mortgage is on what the US would call a "balloon" payment.  What the OP means is that for the 7 years of their mortgage they have a fixed payment amount and a known amount that will be due at the end.  At that point they should be able to get another mortgage fairly easily (though I don't know what would happen if someone was upsidedown or had suffered a job loss, the requirements for moving my mortgage were much lower than the first run, but the house had appreciated significantly). 

Advantage in Canada is that the rates are often lower than in US because the bank isn't hedging on inflation for the next 20 to 30 years, just 3 to 5 years.  Also, I often hear about Americans having to refinance & roll charges into their next mortgage.  In Canada, if I don't like my mortgage company, I can do the same thing _or_ I can just wait until the term comes up.

Disadvantage is that a lot of people talk about the monthly payment amount and term (length of time for this relationship with the financial institution) and less about the number of years the mortgage is amortized over.  It used to be that Canadians were good about paying down their mortgages because there aren't any tax advantages to not doing so, but my guess is that this has become less true over the past 10 years.

[parkette]

I didn't pick up that you were in NB! Hello neighbour :) For once it makes it a bit easier to compare (for me).

A few more comments:

$82.00 Internet Bill (Super Fiber Op!): Internet costs are not fun around here. That being said, we pay $55/mth with Eastlink. I'm assuming you're with Bell considering the fiber op- generally their plans without phone/cable are ridiculous and their customer service is terrible. I do try to shop between the two though when my contract is up. $55 is the lowest price I've been able to get it to, and I really tried to bring it down further! Anyway, check with Eastlink and see what they'd offer for a new customer.

$146.00 Car Insurance (locked in for a year, will re-evaluate in October): I'd recommend checking in to see if you are actually locked in, or if you just prepaid. I have cancelled and been refunded the difference in the past. This cost is really high- shop around! I had a great rate with CAA that I changed recently to lump it in with my house insurance. We pay about $50/mth for 2 cars, liability only. We don't bother with collision/comprehensive because we drive old crappy cars- the extra premiums just won't make up for the meager cost of the vehicles.

$7.99 Netflix: Yes! Well done :)

$325.00 Phone Bill (having trouble letting this one go because it's a SUPER PLAN with all inclusive everything and 6 gigs of data.): I get the impression that you're coming around to the ridiculousness of this. Just wanted to mention that inclusive everything + NOT-unlimited data is easily found for less. My recommendation was also mentioned above- Koodo prepaid. $15/mth base pay for unlimited texting, then reasonable add-ons for Canada-wide calls and data that don't expire for a year. It might be a way to monitor your data usage. Buy the biggest add-on (best value) and then try to see how long it will last! The only thing not included are your calls to the USA- do you make many?

$440.00 Electricity (Varies based on usage): I'm assuming that you heat with electricity... it's expensive, especially this winter. We have oil heat and probably pay about $275-$300/mth for oil + electricity for 1500 sq feet. How big is your house? I bet you could see a big difference in this very quickly; it's low-hanging fruit. These have already been said, but lower the heat (spring will come soon anyway, but remember this next winter!), check out your lightbulbs, ask people to turn off their computers-- or even just turn off the monitor if they're using desktops. We get our electricity from NB and it costs us more so I think you could find some savings.

$650.00 approx. Food (Not bad for a family of 7 right? ...  oh dear, the Mr said that I was pushing it close with this budget...): I personally think you're doing really well with this. High five!

$450.00 approx. Gas for Car *Crying like a baby*: You've already mentioned this is really high. Is it just for the one van? Can you lump errands together?

Finally, I would highly recommend tracking exactly where all your money is going. It is really eye-opening (sometimes disturbing) and will show you what you can cut and where your problem areas are. You have a lot of debt and really need to get this all under control so that you can start saving, investing, and working toward FI. It'll take time but you're on the right path!

PS: The basement rent is really great and I think you'll miss the extra income. If you really can't stand your current tenant, can you find another that better fits your household?

[Prairie Stash]

Your mortgage is normal, for Canada. A little weird being 7 years still, that's longer than usual. All fine though.
Obviously that's electric heat, you need an energy audit! Look at insulation etc.
I can't compare cells, yours sounds horrible. In SK a true unlimited everything plan for 3 is $200 unlimited data, unlimited video texts, unlimited long distance etc.)

What government money does your house get? Child benefits, GST rebates, OAS for grandma? I earn more and get $100 for my child/month. Any child under 7 gets it in Canada.

I would cancel the GIC tomorrow. Pay off the $1000 CC. Piano lessons savings, kids funds are also going. They go to CC #2. If it hurts, I'm sorry but you need to get through the pain to make life better.

[swick]

Also don't forget both the Arts and Sport tax credits for the kids. It is always worth it to see if any programs your kids do qualifies and make sure to ask for a receipt!

I really like Scottishstubble's point that you are basically working a second job to pay for phones and internet, when you think about it like that it is very eye opening.

Definitely looking into options as far as tax breaks for dependents (including Grandma) and seeing if she has any income that can be added to the family pot.

I know how much it sucks to have a renter that doesn't fit with your family. I had no idea that my husband or I were introverts until we had a boarder who is extremely extroverted.  That being said, we would definitely look into doing it again, having learned from our previous experience. It might also be an option to look at shorter term rentals if you live in an area where there are lots of contractors or vacationers. It is a little bit more work, but you can usually make way more money if much less time.

[CentimentalFreedom]

$1200 a year in car repairs is still less than the payment and repair costs on a newer car.  So I would count the Caravan as a win for now, while planning to replace it eventually with an older Honda or Toyota.

You said you had very little furnishings, etc. at home.  The Mustachian way is to make your home pleasant and very livable, and to have an active home life, so that you aren't tempted to get in the car and drive to other places to spend money all the time.  With your two jobs, you're not home much, but others in the family are.  What does your family need to be comfortable and profitably occupied at home?  And where can you get those things inexpensively?

I'd also try to be more stoic about the tenant; protect your emotional space.

I didn't know that new cars cost more. I am hoping that we can avoid getting another car all together with the amount of walking we would be doing.

I believe that I am currently "house poor". I want to pay my debts first and then I'll be asking for everyone's advice as to what to do next but I don't want to throw the baby out with the bath water. When I first moved in, I made my mother's room super comfortable... in fact, it is currently the ONLY room in the house that is completely finished and furnished (thanks, Kijiji!).

Stoicism is something I am definitely going to work on. Although I am a bit hard-headed and overly passionate about EVERYTHING.

[CentimentalFreedom]

Your mortgage is normal, for Canada. A little weird being 7 years still, that's longer than usual. All fine though.
Obviously that's electric heat, you need an energy audit! Look at insulation etc.
I can't compare cells, yours sounds horrible. In SK a true unlimited everything plan for 3 is $200 unlimited data, unlimited video texts, unlimited long distance etc.)

What government money does your house get? Child benefits, GST rebates, OAS for grandma? I earn more and get $100 for my child/month. Any child under 7 gets it in Canada.

I would cancel the GIC tomorrow. Pay off the $1000 CC. Piano lessons savings, kids funds are also going. They go to CC #2. If it hurts, I'm sorry but you need to get through the pain to make life better.

Anyone have advice on reasonably priced energy audits?

Updated the story above with the child benefits.

Working on cashing out the GIC, updated story with new numbers after following your advice.

[plainjane]

Although I am a bit hard-headed and overly passionate about EVERYTHING.

If everything is important, then nothing is important. 

I did some quick Googling and saw http://efficiencynb.ca/home/efficiency-nb-in-the-news.html#Feb32014
- I'd note that you probably don't need an audit, you can do most of the checks yourself.  E.g., what do the insulation levels look like?  Where are your drafts?  Perhaps a task for your brother to take on?

As a baker, I'm sad to see you plan to cut this completely from your life.  Could you switch to making things like pizza or breads?  This would have the added benefit of reducing your grocery bills instead of increasing them.  (A co-worker's partner started to make crackers when the family was tight and couldn't justify other baking.)

And at some point you're going to need to deal with this relationship with Granny.

[CentimentalFreedom]

Although I am a bit hard-headed and overly passionate about EVERYTHING.

If everything is important, then nothing is important. 

I did some quick Googling and saw http://efficiencynb.ca/home/efficiency-nb-in-the-news.html#Feb32014
- I'd note that you probably don't need an audit, you can do most of the checks yourself.  E.g., what do the insulation levels look like?  Where are your drafts?  Perhaps a task for your brother to take on?

As a baker, I'm sad to see you plan to cut this completely from your life.  Could you switch to making things like pizza or breads?  This would have the added benefit of reducing your grocery bills instead of increasing them.  (A co-worker's partner started to make crackers when the family was tight and couldn't justify other baking.)

And at some point you're going to need to deal with this relationship with Granny.

Yep, I tend to go overboard when baking. I'll look into baking breads/pizza.

I'll deal with granny when I can build her an in-law suite.

[going2ER]

I'm in NS so used to the types of bills you  are posting, although not as high, I do understand everything seems to come at a premium.

I agree with others about the phone plan. We are with koodoo and have unlimited free long distance in Canada, voice mail, a few other features that I can't remember for about $30/month. How often do you "need" your phone. I usually use mine for emergencies and when travelling. Work has a phone, we have a land line, so almost anywhere I go there is access to a phone, and for that matter a pay phone is only .25 so cheaper than a cell.

I have been looking at Teksavvy.ca and they seem to cover this area, I need to check out Start.ca too as the cost of internet with Bell and Eastlink is crazy.

For living somewhere close to everything you use a ton of gas. I do not have a gas friendly vehicle as it was selected to be able to pull our trailer, plus I drive 24km each way to work 4-5 days per week. We spend approximately $100 per week in gas, plus we pay more per liter. If you only have 2 children, do you really need a larger vehicle? Does everyone normally go out together? I don't think its necessary for the renter to use your vehicle, just let them know that it is on its last legs and you can't afford to replace it. I also hope he puts gas in it for you.

Unless granny is paying you can not afford to build her an inlaw suite. She has a room and should be contributing to household bills and food, it is honorable to say you don't want to, however, you can't afford to support her. She needs to contribute. Do you also have a neice and another adult living in your home? They also need to contribute.

You can probably still afford to bake, just chose what to make that would be important for your family. Instead of that decadant cheesecake that will cost $20 to make, buy a cake mix for $1.00 and make some cupcakes with the kids. Make bread or cookies that can be packed in lunches.

I would focus on getting the personal debts paid off as that may free up the money you are paying in interest on them.

Would it also be possible for your husband to find a side gig? Either to bring in extra money or to give you a break?

[TrMama]

A good place to start with reducing your energy consumption is to replace your showerheads with low flow models. Look for something around 1.4 ga/min. As a bonus, a low flow showerhead creates less steam and allows me to run the fan for a shorter period, thereby saving even more money by not blowing all our warm air outside.

Also, I just checked my home insurance rates with http://www.insurancehotline.com/. Shop around.

[CentimentalFreedom]

A good place to start with reducing your energy consumption is to replace your showerheads with low flow models. Look for something around 1.4 ga/min. As a bonus, a low flow showerhead creates less steam and allows me to run the fan for a shorter period, thereby saving even more money by not blowing all our warm air outside.

Also, I just checked my home insurance rates with http://www.insurancehotline.com/. Shop around.

Yes, I was checking out plainjane's recommendation for the energy savings and I think I am going to go out to buy a more energy efficient shower head. My shower knobs are tightening as well anymore so I will be asking on the forum for how to fix that. I also have to buy a new more efficient fan because it's being a very inefficient loudmouth right now.

I'll check out that website and intend to shop around.

[CentimentalFreedom]

Unless granny is paying you can not afford to build her an inlaw suite. She has a room and should be contributing to household bills and food, it is honorable to say you don't want to, however, you can't afford to support her. She needs to contribute. Do you also have a neice and another adult living in your home? They also need to contribute.

You can probably still afford to bake, just chose what to make that would be important for your family. Instead of that decadant cheesecake that will cost $20 to make, buy a cake mix for $1.00 and make some cupcakes with the kids. Make bread or cookies that can be packed in lunches.

I would focus on getting the personal debts paid off as that may free up the money you are paying in interest on them.

Would it also be possible for your husband to find a side gig? Either to bring in extra money or to give you a break?

ALL my entertainment comes from the internet, banking, etc. So that's why I upgraded to the fiber op. So far I haven't had the same restrictions as other companies and have been able to do what I please. It's nice to have the internet going without worrying whether or not it will be shut off for a week for "penalty" of going over.

I like your idea of baking for the family and will do that moving forward. I'll start with MUFFINS!! yum yum!!

No I can't afford to build an in-law suite. Call me old fashioned if you must, but this is one of those topics that you'll have to beat me to death over. I can't waiver. The family pressure is too powerful.

My husband relieves my children of dragon lady and I would like for my husband to be around for my kids at least. Rather than them losing both parents.

[CommonCents]

No I can't afford to build an in-law suite. Call me old fashioned if you must, but this is one of those topics that you'll have to beat me to death over. I can't waiver. The family pressure is too powerful.

It's not old fashioned to build a MIL suite, it's newfangled.  Long ago, people even shared rooms...
What family pressure?  Is it your husband?  If so, show him the numbers.  You'd be paying for it at 12% interest on credit cards basically.  If it's anyone else, ask for them to pay for it and estimate high (because renos are usually more expensive than anticipated).

Re tenant, try raising the rent.  Either you get more money to suck up the situation better, or you get them out and can find a more compatible tenant.  And why do you loan the tenant the car???  Bet the tenant isn't filling the car up either, or paying 50+ cents a mile to cover the wear & tear.

[skunkfunk]

I am by no means an expert (I just started at this stuff), but I can reinforce some of the ideas presented here.

ALL my entertainment comes from the internet, banking, etc. So that's why I upgraded to the fiber op. So far I haven't had the same restrictions as other companies and have been able to do what I please. It's nice to have the internet going without worrying whether or not it will be shut off for a week for "penalty" of going over.

Is everyone else just sitting around using the internet all day??? You are paying too much for internet. You're spending 10 hours a week with your kids? I doubt you have time to max out any internet plan, so obviously someone else is. You can't afford it now - $82 a month for internet is insane, especially with how little it sounds like you get to use it. Netflix for a few hours a week does not use that much bandwidth.

Your car insurance is horrible. Don't get full coverage on a 12 year old Dodge Caravan.

Your phone bill - WTF?! Get an MVNO, like Ting or Republic Wireless. No-one - NO PERSON - uses an infinite number of minutes/texts. Even so, with Republic Wireless, you get all text, data, and minutes unlimited for $25/month per line.

Gas and car repairs - this will go down drastically once you start biking and walking. Keep the minivan; you may find that you don't drive much anymore.

Eating out - with a little effort, you can eat better food more consistently for less money at home than you can in a restaurant.

I don't necessarily think it wise to cut out all hobbies permanently, but you have to get rid of that credit card debt. Every payment you make on interest is that much less money you have available for the rest of your life. While I'm only giving advice on things that I've actually done so far - these items are just my opinion.

[CentimentalFreedom]

No I can't afford to build an in-law suite. Call me old fashioned if you must, but this is one of those topics that you'll have to beat me to death over. I can't waiver. The family pressure is too powerful.

It's not old fashioned to build a MIL suite, it's newfangled.  Long ago, people even shared rooms...
What family pressure?  Is it your husband?  If so, show him the numbers.  You'd be paying for it at 12% interest on credit cards basically.  If it's anyone else, ask for them to pay for it and estimate high (because renos are usually more expensive than anticipated).

Re tenant, try raising the rent.  Either you get more money to suck up the situation better, or you get them out and can find a more compatible tenant.  And why do you loan the tenant the car???  Bet the tenant isn't filling the car up either, or paying 50+ cents a mile to cover the wear & tear.

I wasn't intending it as something I was going to do NOW. Sorry about that! It's perspective, the fact is she's taken care of me my whole life HERSELF. I owe it to her to not have her worry about anything. She DESERVES not to worry and I don't believe it's right of me to inflict my own financial problems on her. She certainly hasn't done it to me. Family pressure not husband - he couldn't care less.

The in-law thing was just a thought not a goal.

[CentimentalFreedom]

I am by no means an expert (I just started at this stuff), but I can reinforce some of the ideas presented here.

Is everyone else just sitting around using the internet all day??? You are paying too much for internet. You're spending 10 hours a week with your kids? I doubt you have time to max out any internet plan, so obviously someone else is. You can't afford it now - $82 a month for internet is insane, especially with how little it sounds like you get to use it. Netflix for a few hours a week does not use that much bandwidth.

Your car insurance is horrible. Don't get full coverage on a 12 year old Dodge Caravan.

Your phone bill - WTF?! Get an MVNO, like Ting or Republic Wireless. No-one - NO PERSON - uses an infinite number of minutes/texts. Even so, with Republic Wireless, you get all text, data, and minutes unlimited for $25/month per line.

Gas and car repairs - this will go down drastically once you start biking and walking. Keep the minivan; you may find that you don't drive much anymore.

Eating out - with a little effort, you can eat better food more consistently for less money at home than you can in a restaurant.

I don't necessarily think it wise to cut out all hobbies permanently, but you have to get rid of that credit card debt. Every payment you make on interest is that much less money you have available for the rest of your life. While I'm only giving advice on things that I've actually done so far - these items are just my opinion.

you're right. It's not me using the internet. It's the other 3 people. I don't see the benefit of using internet outside of work, but I've got to entertain everyone some how without being there.  LUCKILY I plan ahead the activities for my kids so that they're not on there. Actually, I've been on the internet MORE since I've posted this case study.

Yes, we are going to discuss with insurance broker to see if we can change companies. The last time I tried she said that I was locked in for another year... although... I didn't sign anything...

sorry, what's an MVNO? Is that only available in the USA?

I'll agree with the car matters.

I think that EVERYONE can agree that I need to cut all DEBT first. Then moderate hobbies can come back.

[skunkfunk]

sorry, what's an MVNO? Is that only available in the USA?

Yep, sorry, forgot that you were in Canada. Canadian regulations make MVNO impossible at this time. Not sure what to tell you about the cell phone bill, then, except that it's horrible.

[CommonCents]

No I can't afford to build an in-law suite. Call me old fashioned if you must, but this is one of those topics that you'll have to beat me to death over. I can't waiver. The family pressure is too powerful.

It's not old fashioned to build a MIL suite, it's newfangled.  Long ago, people even shared rooms...
What family pressure?  Is it your husband?  If so, show him the numbers.  You'd be paying for it at 12% interest on credit cards basically.  If it's anyone else, ask for them to pay for it and estimate high (because renos are usually more expensive than anticipated).

Re tenant, try raising the rent.  Either you get more money to suck up the situation better, or you get them out and can find a more compatible tenant.  And why do you loan the tenant the car???  Bet the tenant isn't filling the car up either, or paying 50+ cents a mile to cover the wear & tear.

I wasn't intending it as something I was going to do NOW. Sorry about that! It's perspective, the fact is she's taken care of me my whole life HERSELF. I owe it to her to not have her worry about anything. She DESERVES not to worry and I don't believe it's right of me to inflict my own financial problems on her. She certainly hasn't done it to me. Family pressure not husband - he couldn't care less.

The in-law thing was just a thought not a goal.

Gotcha.  I can see feeling like you need to take care of her but that can be done as you currently are doing with a roof, food, etc, even a phone and entertainment.  Well, I remind you the best way to make sure she does not worry is to not jeopardize your financial future with unncessary expenditures you can't really afford down the road.  If you mortgage your future to give her a nice suite, that doesn't help her not worry.  (Unless she doesn't care about you being in a good financial state!)

[meadow lark]

I'm confused.  So granny and mother and dragon lady - are these the same person?  On one hand you you talk about how much you owe her, and how much she deserves.  The next second you sound really resentful of her, and your descriptions make her sound very selfish and unpleasant.  I think more important than any financial advice I can offer, is to say you need to work on your relationship with her.  Are you happy that she lives with you?  Does she give as much as she takes?  If yes, great!  Change your attitude.  If not, well, admit it to yourself.  Decide what you think you owe her.  And Yes, she has taken care of you your whole life.  That's what moms do.  You pay her back by doing the same for your children.  She doesn't deserve not to worry about anything.  No one does.  Especially if she hasn't bothered to take care of her own financial future.

[CentimentalFreedom]

I'm confused.  So granny and mother and dragon lady - are these the same person?  On one hand you you talk about how much you owe her, and how much she deserves.  The next second you sound really resentful of her, and your descriptions make her sound very selfish and unpleasant.  I think more important than any financial advice I can offer, is to say you need to work on your relationship with her.  Are you happy that she lives with you?  Does she give as much as she takes?  If yes, great!  Change your attitude.  If not, well, admit it to yourself.  Decide what you think you owe her.  And Yes, she has taken care of you your whole life.  That's what moms do.  You pay her back by doing the same for your children.  She doesn't deserve not to worry about anything.  No one does.  Especially if she hasn't bothered to take care of her own financial future.

"You can't teach an old dog new tricks."

I am neither happy nor unhappy about her living with me, it is the right thing to do. As I mentioned earlier, it's all a matter of perspective. I have an ambivalent attitude towards my situation with my mother. How I think and how I feel towards her evince two different attitudes. She did what she could with what her life had become, there are some situations that are unique to a person's life where they may not have had the choice of taking care of their financial future. No one's at fault, it just is what it is. What she deserves and what she doesn't is all a matter of perspective. My perspective is different.

Wait, how did this become about my mother anyway? Did I do it? Yikes! Back on topic. I am currently checking out Skype for possibilities, what do you guys think?

[swick]

Wait, how did this become about my mother anyway? Did I do it? Yikes! Back on topic. I am currently checking out Skype for possibilities, what do you guys think?

Usually you can't consider major financial changes separate from personal responsibility/family dynamic. Your nearest and dearest will have the biggest impact on your lifestyle and budget and if you want to optimize your financial situation then you have to look at everything.  It sounds like you are being pulled in a lot of different directions.

A resource that has really been helping us lately is Erica's "What I really want from my purchases" Chart.  It is really simple but it gets you thinking about things in a different way. https://dl.dropboxusercontent.com/u/35224895/NWEdible_What_I_Really_Want_From_My_Purchases_Chart.pdf and it doesn't just apply to purchases it is a great way of thinking about all your major decisions - has a way of getting to the root of the problem.

[CentimentalFreedom]

A resource that has really been helping us lately is Erica's "What I really want from my purchases" Chart.  It is really simple but it gets you thinking about things in a different way. https://dl.dropboxusercontent.com/u/35224895/NWEdible_What_I_Really_Want_From_My_Purchases_Chart.pdf and it doesn't just apply to purchases it is a great way of thinking about all your major decisions - has a way of getting to the root of the problem.

WOW! Thank you!! I already emailed it to my husband to print and we're going to implement it right away!

[Ishmael]

Dear Mustachians,

I need help. I always thought that I was the frugal type then I came across this forum and realized that I was clearly deceived by my impulse spending and self-victimization. Good news is that it's all for my family members. I have somehow convinced myself that EVERYTHING is a need: clothes, tutoring , extra-curricular activities all for my children.  My hair isn't on fire anymore, in fact, it's been burnt to a crisp. Here's the financial situation:

I have a Canadian family of 7 and 2 dogs living in a 3 bedroom house with just our beds (no fancy bed sets, just box and spring. There is a $70 bunk bed I bought off Kijiji that the kids share. ), a dresser, a love seat, and a dining table.. Our car is breaking down (so far we've spent $1200 a year on it JUST FOR REPAIRS) so we want a new car, don't know what kind to get for the size of our family. We have a meretricious tenant living downstairs that we want to get rid of (like now, because I want to beat him with a mace then drive over him a couple billion times with my already inefficient minivan. That horrible, horrible grump is really stressing me out). Finally, I want to quit my second job so that I can spend time with my family... maybe retire? On average, I spend about an average of 10 hours a week with my kids... how depressing is that? Bad mother. I know, but what else can I do. There's no money. I am sick of debt. I am sick of restrictions.

Wait! There's more!! I can't say no to Granny. It's been ingrained in me that it's a no-no. Add the guilt trips and constant rants you'll get a tyrant that spends A LOT of money that I don't have. Mostly on food, but the problem is she "buys a fancy pen before she learn's how to write" I hope that makes sense. Is that even how you say it? The Mr. is going to laugh at my sad attempts again. OK... so... the finances...

Don't let her spend your money. I can certainly see providing a safe place for her to live, and some food to eat, but your money is not her money. You have to find a way to manage this.

Income:

$1192 bi-weekly The Mr.
$250   bi-weekly The Mrs. (Part-time, this is an estimated average and is very dependent on how many shifts I work. Usually, I try 2 shifts a week on my days off with my other job.)
$1095 bi-weekly The Mrs. (Full time, does not fluctuate)
$  500 Basement Rent (Will likely disappear if I could I have my way)
$350 monthly for Child Tax Benefit (for the kids anyway)

$5805 approx. net monthly income

Your income is awesome. I live in NS, and cover a house and family (only 2 kids though) and help my mother in law, and our total expenses are under $40k.

Did you consider kicking out the tenant and letting your mother move into that space? More separation might help both of you.

Monthly Fixed Expenses:

$1300.00 Mortgage (Current balance: $165,300 at 3.59% - 7 year term)
$82.00 Internet Bill (Super Fiber Op!)
$146.00 Car Insurance (locked in for a year, will re-evaluate in October)
$7.99 Netflix
$325.00 Phone Bill (having trouble letting this one go because it's a SUPER PLAN with all inclusive everything and 6 gigs of data.)

3 phones (one for granny, one for me and one for the Mr: all unlimited talk/text/North American wide calling... voice mail, caller ID, 6GB data. It's a grandfathered plan and I am STRUGGLING with letting them go.

$1861.00 Total

I personally would deal with the internet cost (as someone who only has access to 1.5mbps, I am very jealous). Put it to work for you though.

As other have mentioned, the phones are killing you. That's huge. If you really think you want the data, we have 1gb plans (each), it's only about 1/3 of the price, I travel a lot and we've never gone over that limit. Just don't watch videos on your phone, period. That's the only thing you have to give up.

Auto insurance is crazy, shop around. I pay $1200/yr for two older vehicles.

I like the house cost, looks like you chose an affordable house! Congrats! Make sure you keep the space organized; borrow a copy of the "Not So Big House Book" from the library for ideas.

Monthly Variable Expenses:

$440.00 Electricity (Varies based on usage)
$100.00 Water and Sewer (Varies based on usage)
$650.00 approx. Food (Not bad for a family of 7 right? ...  oh dear, the Mr said that I was pushing it close with this budget...)
$450.00 approx. Gas for Car *Crying like a baby*

$1640.00 Total

$440/month on electricity???? Holy balls!!!! Here are some things you need to do:

• Stop using the dryer. If your Mom is doing multiple loads of laundry a day, I guarantee that's costing you a ton if she's using the dryer. Install a line outside, and that will give her more to do and be better for your clothes, the environment and everything!
• Get an energy audit, or at least do your own analysis of your house. How much insulation is in the attic? What are the windows like?(Note that replacing windows almost never pays for itself from an energy POV, but sealing them up better and using insulating curtains might).
• Go look into mini-split heat pump heating. They work great in our climate, and probably cost about $3500 to get installed.
• You have a big family, which means lots of available labour. New Brunswick has lots of cheap wood. Look into installing a wood stove.
• Get a plug in energy meter from Cdn Tire next time they go on sale ($20). Use it to find out where your electricity usage is going, aside front he heat and dryer (those are astronomically worse, I guarantee it). Anything that uses electricity to make heat is $$EXPENSIVE$$

Other Expenses:

$1000 estimated to date on car expenses (oil change, maintenance, tire popping, winter damages, etc.)
$200 estimated to date on clothing for kids and granny
$300 estimated to date on all things puppy oriented (except food, which is combined with food budget - I wish i found MMM BEFORE I got the dogs)
$400 estimated to date eating out/movies/birthday cakes...etc..etc..etc... had a super expensive meal at the KEG as a going away thing for a colleague and granny had a stroke so no one felt like cooking (I know, I know... it's changed since then)
$300 estimated to date on medication (granny's old age problems, niece has eczema)
$500 to date on moldy basement windows (some expenses to come during Spring/Summer for installation and new side light and front door also due to mold)

Total: $2200

Nothing here is a raging fire of wastefulness. You can cut down here though.

Moldy basement window might be a sign of too much humidity, rather than a problem with the windows themselves. Buy a humidity meter (they're like $5) and check it, and get a dehumidifier if required.

Replacing windows yourself is not as complicated as people make it out to be in their head. Look into the winter-time sales at Kent, where you get the windows for ~50% off.

Liabilities:

$ 7800.00 Credit Line 9.99% (400 bi-weekly payments going to this)
$ 7600.00 Credit Card 11.99% (500 bi-weekly payments going to this)
$500 (Previously $ 1000.00) Credit Card 11.99% (100 monthly going to this)
$1200.00 Tax Bill (100 weekly going to this)

$16600.00 Total Debt (I hear doom creeping around my bubble slowly sucking what life i have left out of me *Jaws theme playing in the background*)

Yeah, get these paid off as soon as you can. 10-12% interest is a killer. Can you get an unsecured LOC at a lower rate to help out? I have one at 7%, and I'm sure you can do better (I haven't tried because my balance is $0).

Assets:

$1000 GIC - 1 year @ 1.3%
$2642 RESP - 0.5% (YIKES!)
$0 (previously $350)   Savings - 1.3% for Son
$0 (previously $52)     Savings - 1.3% for Daughter
$170   Savings - Piano Lessons (will be empty this Saturday) Piano lessons are 200 per quarter
$40 (previously $89)     Account - *tear*
$400   Savings - 1.3% for children

$14,830 The Mrs' RRSP
$4,325   The Mr's RRSP

I do have employer RRSPs and balances for my husband's RRSPs... will update post with info when I get home.

Total Savings: $23,858

Congrats! You have assets! Focus on getting the flow right first, and you'll be able to build on this.

Stuff:

2002 Dodge Caravan - I bought it CASH! YAY, me! Worst purchase I ever made, now it's just a money guzzler.

Brother - unemployed, in school - is looking for a job
Mother - does not have ability to contribute and, due to some antiquated cultural beliefs, I don't really want to take money from her (buys groceries that she wants on occasion)
Niece - has eczema and asthma, medical bills cost a fortune - mother pitches in where she can (I don't factor this in, what I get is a bonus)
Son (5)
Daughter (2)

Why is your brother and niece listed? Do they live with you too? If so, until they are working they can contribute by firewood and gardening.

The Tenant uses the vehicle on occasion, most of the time it is commuting between jobs and there are occasions when bro takes the kids out swimming and such while he is at home. Free babysitting and home cook because of the amount of people at home.

Energy problem possible cause: Mom does a few loads of laundry a day - it keeps her busy. I have tried on multiple occasions to get her to stop. I really don't have the energy to trigger another nuclear bomb. I feel like there's a ghastly alien hornet's nest floating around my home controlled by dragon lady. All lights in the home are the energy efficient ones thanks to the Mr. I noticed that my water heater was old so I called the power company, they will replace it this year.

$450 in gas!?!?!?!?!?!!?!?! HOLY FUCK!!!!! I thought I was a horrible person because we spent $300/month in gas, and that's because we live in the middle of nowhere. My wife drives 1 hr each way 3x/week, and I have to commute into Halifax once or twice a month (700km each time). Also, kids activities mean we have to drive 40 mins each way once per week as well. And NB has (slightly) cheaper gas than NS!

Seriously, look into vehicle replacement. I know someone that had a Kia Sportage (one of the first ones - piece of garbage) that was able to pay for a new car just on what they saved on gas by making the switch. A Toyota Corolla would be something to look at. Crunch the numbers though!!! You need to consider 4 factors when replacing your vehicle:

• Reliability - look at Consumer Reports
• Cost (obviously)
• Person capacity (you do have a large family)
• Fuel economy (do the math!!!!)

You let the tenant use your vehicle? Um, no, unless they are paying government reimbursement rates for the vehicle. Not sure your insurance covers this situation anyways though.

To be a little more detailed according to my statements in the last 3 months, I have spent...

$822 on dining out (McDonalds, Starbucks, etc.)
$350 on gifts
$192 on books and board games (including shipping from US to Canada - never doing that again)
$300 on hobbies (I bake...a lot...)

$1564 Total wasted money in the last quarter.

Mustachians were right... it's an eye-opener... all of these expenses will STOP completely, no excuses.

The reason there really aren't any other costs are because the kids usually get gifted clothes for their birthdays. I RARELY need to buy clothes. Most of the spending has been on my niece so far but that has stopped because she's gotten what she needs. I cut EVERYONE's hair (thanks to YouTube for the certificate ;)).

Make the baking make you money, rather than costing a lot. This is a grocery expense, not a hobby expense. Make bread (look into 5-minute-per-day artisan bread, sorry I don't have time to look for the link), etc.

You already know the rest of it.

We live:

Approx. 4 KM from my part time job. (I have tried to walk this, takes my about an hour. I have short legs, deal with it. I do intend to walk more in the summer.)
Approx. 7 KM from my full time job. (I intend to buy a bike for this... well keep you posted)
Approx. 11 KM from the Mr's job. (Good luck trying to convince him to bike that)
Approx. 2 KM from Costco and Superstore (We decided to walk this in the summer and if all goes well we'll do it in the winter... Good luck spending money Granny... MUAHAHAHAH)
Approx. 3 KM from Walmart Supercentre

CostCo has a really cool electric scooter that might help the Mr commute. Just search their website. Won't work all year, but 6+ months is a huge benefit.

Also, electric bikes. For 11km, it might provide the boost needed to leave the car at home.

We do not live in a bike friendly neighborhood, but at least I chose a home purchase located within walking distance EVERYWHERE (except for outdoor entertainment like hiking, camping, fishing, beach, etc).

Of course you don't - you live in Atlantic Canada where cars are seen as the only way. Don't get me started...

hiking, camping, fishing, beach, etc... these are what make life living. Don't ever stop going to these to cut back, just figure out how to do them as efficiently as possible, and enjoy every minute.

I need a new car and want to know what you think I should get to help my family. Also, maybe tell me where I can improve since I am SURE there are improvements that can be made. Thanks for your time.

Update

March 23, 2014   Spoke to husband, we are walking everywhere once the Summer months start. I am looking on Kijiji for bikes. Went through the plans. I didn't mention that when I begrudgingly moved to New Brunswick from BC, I refused to change my phone numbers - hence the $20 unlimited NA wide calling. It's my connection to home I have left. Even now, going through the plan I don't see it. Mom's plan is only 50 unlimited everything. It's the two other plans that I really need to go through.

March 24, 2014   A thought just crossed my mind. I'm with FIDO, can't I just keep the 6 GIGs and use Skype (voice) and Facebook (text/video) ... ?!?!?!?! What do you guys think!?!

You've got lots to work with. I worry about the resentment building up with your Mom - you guys seem to need some space from each other to make your relationship better.

Phone - I have a MagicJack (VOIP). Free calls in North America, and for less than $100/yr you get a phone number and voice mail THAT'S DELIVERED TO YOUR EMAIL!!! Take advantage of your internet connection.

Hope this helps a bit.

[CommonCents]

$440/month on electricity???? Holy balls!!!! Here are some things you need to do:

The list is great, but do keep in mind it sounds like she has electric heat, so it may not be quite as bad as you are thinking.

Why is your brother and niece listed? Do they live with you too? If so, until they are working they can contribute by firewood and gardening.

I suspect the niece is about the same age as her own kids - 2-5ish, so I wouldn't put that expectation of "work" around the house on her like that.  That's unreasonable.  She's a child and should only do the same child oriented tasks her own kids do (e.g. clearing plates of the table maybe...not gardening to feed the family!)

Otherwise I agree with you.  I'd add that you should consider taking some of the assets and putting them to the credit card debt so it stops eating you alive, assuming
1) You will NOT grow the debt back up
2) You will immediately build an emergency after they are paid off

Also.  Recognize that you CANNOT afford to save for the kids right now.  You need to save for your retirement because you can't get a loan for that...

[Ishmael]

The list is great, but do keep in mind it sounds like she has electric heat, so it may not be quite as bad as you are thinking.

Even still, though. Now, I did assume that was averaged out for the year. If that's only during the winter months, it might be reasonable.

For comparison, I supplement my wood heating a bit with electric, and my total electric bill still averages out to $90/mo over the course of the year.

[RetiredAt63]

Just a slight shift - you are working super hard.  It can be hard to say "no" to others, especially when you are worn out from two jobs.
There is a group on Ravelry (a web site devoted to the fiber arts, such as knitting, crocheting, spinning) called the "selfish knitters and crocheters".  It is very good at helping people stand up for themselves (knitters and crocheters get asked for free stuff a lot, they call these people who want free stuff  "gimmiepigs".  Even if you never do any fiber crafts, that group is an education on standing up for yourself.  Ravelry is free to join, at https://www.ravelry.com/

Also, Xplornet is based in NB, maybe they would be a good internet provider?  And as you are realizing, your cell phone costs are astronomical.  I am with Fido (no data plan, good phone and text and Canada-wide) and have my home phone through them.  I have cut the ties with Bell completely.

Food and such look good for Canada, and I envy you your mortgage rate and 7 years.  My 5 year term is up this September - I may hit a mortgage broker before I go to talk with my bank about the renewal.  My house and car insurance are done through a broker, and my terms are good - I called a few insurance companies when I was due for renewal, and nothing they could offer was better, generally it was worse.

[CentimentalFreedom]

Just a slight shift - you are working super hard.  It can be hard to say "no" to others, especially when you are worn out from two jobs.
There is a group on Ravelry (a web site devoted to the fiber arts, such as knitting, crocheting, spinning) called the "selfish knitters and crocheters".  It is very good at helping people stand up for themselves (knitters and crocheters get asked for free stuff a lot, they call these people who want free stuff  "gimmiepigs".  Even if you never do any fiber crafts, that group is an education on standing up for yourself.  Ravelry is free to join, at https://www.ravelry.com/

Also, Xplornet is based in NB, maybe they would be a good internet provider?  And as you are realizing, your cell phone costs are astronomical.  I am with Fido (no data plan, good phone and text and Canada-wide) and have my home phone through them.  I have cut the ties with Bell completely.

Food and such look good for Canada, and I envy you your mortgage rate and 7 years.  My 5 year term is up this September - I may hit a mortgage broker before I go to talk with my bank about the renewal.  My house and car insurance are done through a broker, and my terms are good - I called a few insurance companies when I was due for renewal, and nothing they could offer was better, generally it was worse.

"Gimmepigs" oh dear! I will read it, thanks for the support!

I did some shopping around for my mortgage and negotiated as well... I know TD is posting 2.99% but I don't know what that entails. I wrote down the number for CAA and plan on giving them a call.

[skunkfunk]

I did some shopping around for my mortgage and negotiated as well... I know TD is posting 2.99% but I don't know what that entails. I wrote down the number for CAA and plan on giving them a call.

If you've only 7 years left on your mortgage, and given your current rate, it is most likely not in your best interest to refinance.

[CentimentalFreedom]

If you've only 7 years left on your mortgage, and given your current rate, it is most likely not in your best interest to refinance.

Oh! I was explaining how I got my mortgage rate. Sorry about that!