Help! What do i do with my money?

**Magster** · 05-09-2009, 10:22 AM

hi, this is my second post, just started reading Dave Ramsey's "TMM". All our situations are so unique it's hard to figure out what is best to do for my own personal situation. Can you help?

We are in our late 20s, have 2 little girls and another on the way. We just started a business and I just quit my job and I'm home with the girls finally! We are so happy and just want to make this work so badly. We've worked very hard to get the money we do have and I don't want to mess it up.

Here it is:
We sold our last house and with our equity into it we ended up with $50K in cash.

We put 27K down on the new house so our mortg. is only $100K at $656/mo including taxes and insurance at 4.8%.

With 9K we paid of all credit cards and hospital bills.

I still have $16K in student loans at 2.8% and $118/mo.

We have 2 cars which we own, combined worth no more than $9000.

The business has debt though, it is an LLC but it's still debt that I want to work down somehow. With the truck loan, it's a total of about $22,000 debt a a few loans.

So we have about $14,000 left and it's just sitting there. What do i do with it?

1. leave it in a savings: for when this baby comes to help pay for hospital bills. And/Or to supplement the next year in case we really struggle with the new business?

2. Invest in some long term or short term something. Actually start our retirement!

3. Spend about $3000 to finish the basement and therefore have an office for my husband to work from. We have 3 finished bedrooms, we're in one, and my 2 girls are in the other, and the other is the "office/toy room". It would be really nice to finish downstairs so he can be away from the kids when working and I'll have a the other room for the new baby.

4. Spend any??? We've wanted a piano since we got married and I can justify this all I want with telling you how hard we worked for this money and say that we deserve a gift to ourselves, but i really want to do what's best. That would be about $3000.

5. Pay off any debt. I'd rather it go towards the business, because this amount wouldn't cover my student loan so I'd still have the payments anyway, and it's a lower interest rate.

Sorry this is so long. Please help! What do I do? A combination of them?
-Maggie

**ladykemma2** · 05-09-2009, 10:59 AM

Originally Posted by Magster

hi, this is my second post, just started reading Dave Ramsey's "TMM". All our situations are so unique it's hard to figure out what is best to do for my own personal situation. Can you help?

We are in our late 20s, have 2 little girls and another on the way. We just started a business and I just quit my job and I'm home with the girls finally! We are so happy and just want to make this work so badly. We've worked very hard to get the money we do have and I don't want to mess it up.you went home and started a new business at the same time. hmmm. do you have any backup plan to support yourselves while the two years it takes to see if a business is going to work out?

Here it is:
We sold our last house and with our equity into it we ended up with $50K in cash.

We put 27K down on the new house so our mortg. is only $100K at $656/mo including taxes and insurance at 4.8%.

With 9K we paid of all credit cards and hospital bills.

I still have $16K in student loans at 2.8% and $118/mo.

We have 2 cars which we own, combined worth no more than $9000.

The business has debt though, it is an LLC but it's still debt that I want to work down somehow. With the truck loan, it's a total of about $22,000 debt a a few loans.

So we have about $14,000 left and it's just sitting there. What do i do with it?

1. leave it in a savings: for when this baby comes to help pay for hospital bills. And/Or to supplement the next year in case we really struggle with the new business? absolutely

2. Invest in some long term or short term something. Actually start our retirement!nope

3. Spend about $3000 to finish the basement and therefore have an office for my husband to work from. We have 3 finished bedrooms, we're in one, and my 2 girls are in the other, and the other is the "office/toy room". It would be really nice to finish downstairs so he can be away from the kids when working and I'll have a the other room for the new baby.this is a want not a need while you are in debt

4. Spend any??? We've wanted a piano since we got married and I can justify this all I want with telling you how hard we worked for this money and say that we deserve a gift to ourselves, but i really want to do what's best. That would be about $3000.this is a want not a need, too risky right now. how about making this a reward for being frugal, and whent he business takes off, it can be a proud reminder out how hard both of you wroked to get it. you want it to be a blessing rather than a curse.

5. Pay off any debt. I'd rather it go towards the business, because this amount wouldn't cover my student loan so I'd still have the payments anyway, and it's a lower interest rate.not yet

Sorry this is so long. Please help! What do I do? A combination of them?
-Maggie

............................................

**Michelle68** · 05-09-2009, 01:02 PM

I agree with Ladykemma--leave the money in savings for the hospital bills and for any unforeseen need while you are getting the business up and running. Good luck!

**Magster** · 05-09-2009, 03:02 PM

Ok, about finishing the basement. So if we don't do any of it then we have 3 bedrooms for me and husband, 2 girls, and a new baby. Plus and office for the business. So where do i put the baby?

Are you sure at least finishing one room in the basement for the office isn't getting to be a need? If we don't do the whole basement and just do the one office, then it would cut it down from 3000, to 1000 or less. Please, please can I???

Our life would be so much better if I had a place for this baby and my husband had a place for his office.

Back up plan? Well, yeah, i can go back to work, my husband gets another job etc. My profession is highly available and always hiring, I've never not been able to find a job - even in "this economy". That is last resort, but it's an option.

After talking all this through I think it is best to keep as much money liquid as possible in a savings account - accessible.

Also we are always working toward a food storage for financial times of hardship, what if I took some and put it towards that too? I feel like cash and food storage are pretty much the same thing because in hardship, that's what the money would be for anyway.

What do you think?

**ladykemma2** · 05-09-2009, 05:20 PM

why don't you pray about it for a week and see which decision gives you peace in your heart. an uneasy feeling, a feeling of doubt, or guilt, or "not yet", or "yes" may come.

now the latter day saint in me is going (brightly) ohhhh a room in the basement for food storage....! I feel peace in my heart (ha ha) for you spending about 1000 or more for food storage. I have a testimony of food storage. People laughed at me. BUT, I have lived on my food storage in times of crisis twice now, once when husband was ill for a long time, and during the divorce last year.

if it were up to me i would put the kids and the food storage in the basement and the office upstairs. (grin)

anyway if dave were advising, he would say, you have stormclouds on the horizon and to pack every penny away. pay the minimum and stop the TMM.

edited to add: i wouldn't go back to work, 3 kids daycare would kill any funds you brought home. ugh. Instead become the leanest, meanest, frugalista in the neighborhood . make a penny scream. clip coupons, meal plan, line dry clothes, all the things recommended on this site.

**craftypam** · 05-09-2009, 05:53 PM

I was so much in your position. I stayed home with the kids from the start; my husband has a seasonal job. He also decided to do it on his own after I'd been staying home. Money or not I found it soooo worth it!!!
I definately would keep the money in the bank because of not knowing how the business will go. Why not put the new baby in the toy room and just put some of the toys in the girls room to play with and the rest in the basement. My boys never had a toy room. Why not do something very minimually to make an office for dh. I too would work on paying off debt as much as possible; but not touching the savings. I know what I am talking about. I have been married 33 years; my husband has been in business for about 15 years; I have excellent credit; I have no house payment; no car payments and a small amount of credit card debt. And hospital debt I would make payments, if allowed, because there is no interest on that debt.

If I were you I would leave the money in savings so you will be sure you won't have to go back to work because of the child care. It will defeat the purpose. Living frugally will get you through and get you that office and piano sooner.

**Magster** · 05-09-2009, 06:53 PM

Ok, that's a plan then. I've already started up my budgeting again. I'm struggling though. We just moved from one town to the next and our insurance premiums changed etc, so it's hard to know what bills will be. But in reality I can't really control my city utilities very much, so why worry about "budgeting" it right now. I think I just need to take this next month or more and just track everything. I've done it before. I used to know where EVERY penny went, literally. Now, we easily spend a few hundred without even recognizing it. I've got to go back to my old ways.

Thank you for your advice.

**Siebrie** · 05-11-2009, 08:16 AM

My dd slept in our room for the first 6 months. I think it was ideal, because I was breastfeeding and could stay half asleep during the nighttime feeding.

Do you have any idea how high the hospital bills will be? Maybe an average of the birth of your first 2 babies? Then I'd suggest you keep that money at hand.

**Greebo** · 05-11-2009, 08:34 AM

Originally Posted by Magster

Ok, about finishing the basement. So if we don't do any of it then we have 3 bedrooms for me and husband, 2 girls, and a new baby. Plus and office for the business. So where do i put the baby?

Either with one of the girls or put the girls together. Children will not suffer deep trauma by sharing a room. Children for thousands of years have grown up sleeping in the same room together.

**itlw8** · 05-11-2009, 10:56 AM

most new businesses do not make a profit the first year so you especially need back up savings.

8 months living expenses would be wise. a stock pile is great but if there is no money for the mortage that month you can not pay it in food. save the money you of all people need a healthy savings account.

**itlw8** · 05-11-2009, 11:01 AM

Is his business run out of the home or does he have a plase of business.. if so his office should be there and not at home.

another thought a a biggie is health ins do you hae any now with quitting your job ? You need it as a selfemployed family you now have to buy it yourself.

**Wendy99** · 05-28-2009, 09:56 PM

Originally Posted by Greebo

Either with one of the girls or put the girls together. Children will not suffer deep trauma by sharing a room. Children for thousands of years have grown up sleeping in the same room together.

I thought she meant she had 3 bedrooms total

one for her and her husband
one for the 2 girls
one for the office

I think she is then wondering where to put the baby. Correct me if I'm wrong??

Also does your husband have customers / clients come to his office? If not whats the harm in working in an unfinished basement. Throw down a mat for his computer and desk and voila

JMO

**kita** · 05-29-2009, 10:09 AM

Greebo,
You aren't exactly right onthis one...

Either with one of the girls or put the girls together. Children will not suffer deep trauma by sharing a room. Children for thousands of years have grown up sleeping in the same room together.

Truth is...Children have been sharing the same BED for thousands of years. And in Asia, Children and Parents have been sharing the same bed for thousands of years. I never understood where the younger children came from in that case, but it seemed to work out....

**kellieetter** · 05-29-2009, 11:05 AM

I have my own business too so I know how you feel about having business debt. Me personally I would try to pay down as much of the debt as I can, thats just me though. I know it is important to have a back up fund just in case but for me I am happier try to pay off my debt. You really have to do what you think is best for you in the long run.

I know it is important for you to get the basement down so it opens up and extra room, so maybe you can do that and then put some of the remaining money into debt and some into savings just in case.

**qsaver704** · 05-29-2009, 01:51 PM

I agree with a "makeshift" office in the basement (the mat and desk just sitting there, maybe a new good lamp). Put the baby in the play room.
no piano-not now
don't worry about cars and student loans