Reply to $155K HHI and broke

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We have $155K HHI and we are broke.  I need advice - maybe I can cut spending somehow?  Here are some of our bills:

$2500 - mortgage
$1600 - childcare
$450 - 2 cars
$45 - internet (no cable here)
$200 - 2 cell phones (no land line)

I should have added:

$725 - student loans[/quote]

and

$350 - elec, gas, water/sewer, trash collection
$100 - life insurance
$80 - car insurance
[b]$200 - credit cards ($5K)[/b]
$80 - diapers, wipes, paper goods
$120 - work parking
[/quote]

This is very bad. I would pay this down before you do anything else. If you save 150 on your cellphones you should put the extra into paying down your credit card. What rate are you paying on it? Any chance you could get a HELOC to pay it down? Interest rates are extremely low, e.g. 2.5 with penfed for 5 yrs.
Can you refinance your student loans? What rate are you paying on them?
What life insurance do you have? You should just have one 10-year and one-20 year term for an appropriate amount (e.g. 500k each).
personally I would lose the gym and take up cycling or some other form of exercise like body weights that you can do at home, at least till you have dealt with the credit card debt.
1600 seems a little high for childcare - have you looked into cheaper options?
I get your foot problems, but why do you need two cars?[/quote]

I agree with this poster, OP.  We are in a similar boat income and expense-wise and our CC debt is what's killing us.  A lot of that debt was racked up through emergency home repairs that also depleted our savings (damned insurance NEVER pays out enough to cover things).  I used my bonus to pay off a big chunk but we have a long way to go.  We are paying WAY more than the minimums each month, and as other things like student loans and smaller CC balances are paid off that money gets rolled into the next card, starting with the highest interest rates first.  Once we get these paid way down, sell our home and move to a lower COL area, I think we will finally be in a much better position.  We'll have enough in equity to pay for the move, a down payment, pay the CC's way down AND have some left over in savings and/or to put into a brokerage account so we can build liquid wealth as a cushion.  Once we get there, we are NEVER racking those damned CC up again![/quote]

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