Earning Well but Drowning in Debt...how to dig out?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My bet is that OP went out and bought all 3 kids brand new boots, snow pants, jackets, mittens, hats, new sleds, new shovels just their size and blew $250 because it's snowing and the kids wanted to go outside for 15 minutes

Impossible to buy all of the above for 3 kids for $250.

Agreed, and for the record, my two have been outside for hours and hours. I have the dryer running non stop.not od wet into dry and repeat.

I'm certainly not going to hate on patents who want to warmly clothe their children.

You can warmly clothe your child for much less. I got snow pants for $5 and boots for $3 at a consignment sale. I think that was pp's point.

Get those bargains at a consignment sale/thrift store requires:
1) Being there when the store's open (they often close @ 5)
2) Happening to see something in your kids' sizes -- you won't go 3-for-3, but maybe 1-for-3 and 2-for-3. So then there's 2-3 trips to different stores
3) Beating out Everyone Else for the stuff in your desired sizes and that isn't horribly inappropriate for whatever reason (e.g. something from 1985).

Maybe doable for a SAHM with a preschooler or whose kids are all in school. But a woman working 40+ hours a week is supposed to do her consignment/thrift shopping when, exactly? I hardly think most dual-income families want to spend their weekends combing over thrift stores.

This is something where the time spent looking for bargains can really add up.

Walmart and Target are good for inexpensive clothes - I get a ton of clothes there. Everything from shorts to orchestra attire. You can go to the consignment stores when you get a chance and you can go to weekend yard sales and flea markets. Craig's list and even free cycle.

[Anonymous]

OP is competing for resources with highly educated, driven people in this area who have made either smarter or tougher choices. She does not understand the competitive environment in which she operates. Or she refuses to acknowledge it.

[Anonymous]

Are we really discussing if an elementary school student should be in a car seat or how they racked up 8K in medical? (maybe it was in 2 calendar years 4K in both?)

Reality is the family has debt and is looking how to get out.

Option 1 - make more money (change jobs)
Pros - can pay off debt quicker
Cons - trade off of hours worked and long term employment.

Option 2 - spend less money by reducing discretionary spending
Pros - can start taking action immediately
Cons - small impact on total amount of debt and it will take time to see results

Option 3 - make a change so that there is a step change in the non-discretionary spending
Pros - can make significant impact in paying down debt quickly
Cons - major life change

Option 4 - combo of above

[Anonymous]

I was genuinely curious if a 4th grader needs a car seat because it makes that last OP suspect, also

And I think the latest OP response is a troll and not the OP, since OP said previously she was a lobbyist and husband works on the Hill (it was a short post I quoted on the previous page) that was missed by a lot of later posters and now she said they don't want to be law firm partners and are lawyers.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The $8k after one of the pregnancies could have been therapy for PPD pre-ACA, when mental health wasn't covered like physical health. At $100/session it can add up. Could have also been marital counseling, which is really spends.

That is speculating. It's also possible that OP had major surgery and was under a plan when she had to pay 15% or 20% of the costs after a certain amount. I recently had a very simple surgical procedure that lasted 45 minutes, but cost me close to $4k because Blue Cross Blue Shield Standard required that I pay 15%. Bills to surgeon. Bills to hospital. Bills to anesthesiologist. Bills to pathologist, etc., etc. I can definitely see how it's possible to have $8k in medical bills as a fed. if something isn't covered entirely.

I don't. Most plans cap out of pocket costs and exclude infertility (if it's covered). Our plan is 3k.

My BCBS catastrophic maximum is $5500 as a single person.

[Anonymous]

I am glad to see this thread has mostly moved out of OP bashing mode.

That said, I personally would be panic stricken if I were in OP's place. Moving does not seem practical, and it is unclear if selling a car is worth it.

So what we are left with as the first step as many have said is paying of a big chunk of the credit card debt with the emergency fund. As I recall they are paying into their TSPs--if they are contributing in excess of employer max match (can't recall) they could cut back on the excess for a while (not too long--that is their retirement) and put that towards the rest of the CC debt. I personally would scrap all summer camps and any summer day care and use a combination of parental leave and a college student.

OP has said she feels obliged to give her DS music lessons once a week. I am with her on that. But apart from that, she needs to cut way back and find places to economize. She should go through her house and see what she could sell on Craig's List. I am betting she could come up with at least $1000 to put towards that CC debt and it will make her house feel more spacious.

She needs to see if she can get a better deal on car and home insurance. She should look into her cell plan to see if there is a better deal. Or scrap it altogether since she and DH can possibly use their work Blackberries. There is some clever alternative to cable I've seen here that she should look into (I didn't understand it, but the posters swore by it). Same with internet providers--all this media stuff adds up fast.

Apart from these things, all the basics of frugal living: no eating out or take out--lunches get taken to work and school, no clothing except for kids--try Goodwill, no purchases for just about anything else except food and gas (oh, right--the darned child birthday gifts--find a cheap source), no vacations except driving to family, no dry cleaners unless you really can't wash on delicate or wool cycle, etc.

All of these things add up and I am guessing that OP by being very mindful about what she spends could reduce monthly expenditures by $1000 to $2000 to finish off the CC debt and start in on the student debt.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My bet is that OP went out and bought all 3 kids brand new boots, snow pants, jackets, mittens, hats, new sleds, new shovels just their size and blew $250 because it's snowing and the kids wanted to go outside for 15 minutes

Impossible to buy all of the above for 3 kids for $250.

Agreed, and for the record, my two have been outside for hours and hours. I have the dryer running non stop.not od wet into dry and repeat.

I'm certainly not going to hate on patents who want to warmly clothe their children.

You can warmly clothe your child for much less. I got snow pants for $5 and boots for $3 at a consignment sale. I think that was pp's point.

Get those bargains at a consignment sale/thrift store requires:
1) Being there when the store's open (they often close @ 5)
2) Happening to see something in your kids' sizes -- you won't go 3-for-3, but maybe 1-for-3 and 2-for-3. So then there's 2-3 trips to different stores
3) Beating out Everyone Else for the stuff in your desired sizes and that isn't horribly inappropriate for whatever reason (e.g. something from 1985).

Maybe doable for a SAHM with a preschooler or whose kids are all in school. But a woman working 40+ hours a week is supposed to do her consignment/thrift shopping when, exactly? I hardly think most dual-income families want to spend their weekends combing over thrift stores.

This is something where the time spent looking for bargains can really add up.

Wait, are you kidding? I wrote that. I'm also part of a dual Fed family with same HHI as OP.
People do this. But keep justifying every expense...

[Anonymous]

OP I know a LOVELY couple that lives in a two-bedroom beautiful condo with THREE BOYS. The place is not a mess and they make it work because they have to. Get rid of all your CLUTTER and you can make it work.

Make the changes that you HAVE to make. Just do it! No more excuses.

[Anonymous]

Speaking of clutter...be sure to participate in your neighborhood yard sale.

[Anonymous]

I am a carpooling mom and while my 5th grader does not need a booster in my car, there are several 5th graders who do need a booster. Some are girls and are not super petite but do have longer legs.

If the seatbelt doesn't hit the kid in the right place, they are going to sit in a booster in my car because their safety is my responsibility in my car.

So yes, it is totally realistic for a 4th grader to need a booster.

Here is the 5 step test. http://www.carseat.org/Boosters/630.htm

Kids can pass the 5 step test in some cars and not in others.

We went to Europe this summer and my 10 yr old had to be in booster by law there. So I am not even as strict as the EU is!

[Anonymous]

Consigment shopping is often more than buying new. With clearance, coupons and buying ahead, you can get new cheaper. Target is expensive for clothing and they don't have great clearances anymore. Walmart is hit or miss with prices.

[Anonymous]

OP, if you are ready to not be stressed out about money, look at this thread the way a dog looks at a bone. You may have to chew a lot to get the meat off of it, but there are good recommendations here.

I hope that you and your husband can get on the same page.

Good luck.

[Anonymous]

Anonymous wrote:

I do have a child who is musically gifted. He is not in Kindergarten as other posters have alluded to, but is in older grade in elementary school. It is not some bragging right for us wannabees to flaunt. He has been flagged as gifted by his school, and is playing his chosen instrument at a pre-professional level at a very young age, with just a couple years of training. Elementary school band/orchestra doesn't cut it at this point. Sorry to disappoint you naysayers. We are doing our best to support him.

Since he is pre-professional now, what is going to happen in a year? He becomes a professional musician in the 2nd grade? Really? He is that much of a musical prodigy? And if so, isn't that good news since as a professional he can start earning money.

Seriously though, if he is already at that level, then stopping lessons for a year or two or just dialing back isn't going to ruin his talent. And try and remember that he might very well lose interest in stop playing in a couple years. And yes, it's only natural for a parent to brag about their gifted child and if you prattle on here about how amazingly gifted he is, irl you are doing the same and worse.

The real problem isn't the music lessons though. It's they way you frame the situation to believe that you have to provide these lessons at the expense of getting out of serious debt. If not these music lessons, something else will come along that one of your kids will be gifted in and you will then start pouring money into that.

The reality is despite the amount of income and debt you and your DH make combined, you can only afford a middle class to lower middle class lifestyle in this area and you are trying to maintain an upper middle class lifestyle. 3 kids in this area is tough. It's tough in a way that bumps you down the socioeconomic level very quickly if you do not truly have a very HHI and little debt.

PP were not being nasty when they suggested moving. Long term, it really is a better economic choice unless you really can change your mindset now and get rid of the crippling debt.

[Anonymous]

Anonymous wrote:You need to control your spending. I'll bet you can cut back on lots of things and still maintain a decent lifestyle. We live quite well on half your HHI, but we have no debt.

Can you take out a HELOC and pay off the credit card debt? That's the first place to start. The interest rate on credit card debt is outrageous, but the interest on a HELOC is a fraction of that. You might also be able to pay off part of your student loans with a HELOC if it's at a much lower rate.

That will cut your payments at least, and you would not be taking on any more debt.

Trade in your newish cars and get used minivans (they are spacious and cheap). Plenty of space to haul around three kids. Use the cash you raise to pay off more debt. Do not spend it or put it into savings.

Take cheap vacations or none at all. Don't throw away cash on big trips to Europe or renting a nice beach house when you can stay in a moderately priced hotel in a pleasant place for a week for the same price. Take day trips if you need to get out of town.

Look at your monthly expenses: What do you pay for heat? Do you really need to keep your thermostat at 72 degrees all winter? We keep ours at 65 degrees. Yes, it feels cold in the fall, but we wear sweaters and get used to it. As an added bonus, we get fewer colds when the temperature is lower in the house.

What are you paying for TV each month? Can you cut back on some of the premium channels? Can you live without cable? We don't have a TV, but we watch TV shows on our computers.

What are you paying for cell phones? There is lots of competition, so you can surely get a lower priced plan.

How much do you spend each week on lattes? Just cut that out right now. Bring your coffee from home in a thermos.

Go out to eat once or twice a month, period. And go to family-type places. You're over date night at fancy restaurants if you've got three kids.

How much do you spend on convenience foods? Takeout? Cook more, and you'll save money.

Have your housekeeper come every other week instead of every week.

Mow your own grass.

Shop at TJMaxx. They carry last-year's Nordstrom merchandise at a fraction of the price. I keep my clothes for more than a year, so it makes no difference to me.

That should get you started. as a pp said, it's not rocket science. You have to take a cold hard look at your "necessities" and cut back ruthlessly. Consider "needs" and not "wants". Get rid of the "wants."

Best of luck to you OP.

GREAT advise

[Anonymous]

Haven't seen this mentioned yet -- Public Service Loan Forgiveness goes live in 2017.

OP, if you and your husband are feds and have made on-time, qualifying payments on federal student loans for the past 10 years, you may be eligible to have the balance of your student loan debt forgiven. Details here: https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/public-service