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budget help needed

4K views 39 replies 16 participants last post by  Hamada 
#1 ·
Ok, so I need help. I am reading through all of these, but I need advice that is personalized for me. Because I can't seem to "get" it. And I keep saying "if only I could have someone tell me exactly what to do!!" So here goes...And this will be WAY too much info, I am sure. But I REALLY need help.

I am 30 years old and I own my home. (I owe $172k, and worth about $150k)

I filed bankruptcy in November. :pdoff:

One of my loans (for about $6k) is now my mom's sadly...she was my cosigner. I am behind on that (since it's still my problem) at about $900.

My mom lives with me. We share our income, but truly only do that because 5 years ago, it made sense. Now we realize our co-dependency issues and want to separate. But don't know how.

I have a car loan for about $2k (my mom drives that car) and she has a car loan for about $7k for her car (that I drive).

I am behind on every single bill I have. And they are all "regular" bills. No credit cards (obviously after BK) anymore. Since my mom and I share expenses, hers are mine and vice versa. And that has not been working out lately...for awhile.

She is normally on unemployment (she is a construction flagger) and gets paid weekly ($1680/month) and I get paid bi-weekly ($2400/month)

My mortgage is $926 (due on 1st, but don't pay until end of month since behind)
Car (one I own) is $250.60 (paid off in July or August I believe)(about two weeks behind)
Car (mom owns) $213.16 (about two weeks behind)
Cells are about $120 (behind)
House phone is MagicJack
Insurance for both vehicles is $147
Direct TV is about $80but bill is about $250 since behind
Internet is about $50
Mom's medical after hip surgery is roughly $2k
Mom's union dues are $20 (but owe about $80)
Electric is about $120 (but bill is $511 minus $150 JUST paid an hour ago)
HOA is $72 (but wayyyy behind)

So anyways, that is a look at my situation. I have no idea how to catch up. I want to start putting aside some money so I can get a smaller apartment closer to work (I live about 30 miles from work and it's awful), rent out my house and mom wants to move to Arizona.

I was never taught how to deal with money and never took it upon myself to learn sadly. Mom was never taught either. We used to have a lot more money. Sadly, things changed.

I really, really, really need help. :jug::smhelp:

I keep hearing about the Dave Ramsay "way", but I can't even afford to buy his stuff! And I am sure I am forgetting some bills. I am drowning and have no idea how to swim.
 
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#2 · (Edited)
Hopefully some brilliant moderator will move this to a new thread under the financial hardship section so that it will get the attention it deserves. Don't worry about giving up too much information and too many details. We may want more. And the village LOVES to answer these kinds of questions. We may get a little enthused though, so brace yourself
Ok, so I need help. I am reading through all of these, but I need advice that is personalized for me. Because I can't seem to "get" it. And I keep saying "if only I could have someone tell me exactly what to do!!" So here goes...And this will be WAY too much info, I am sure. But I REALLY need help.

I am 30 years old and I own my home. (I owe $172k, and worth about $150k)

I filed bankruptcy in November. :pdoff:

One of my loans (for about $6k) is now my mom's sadly...she was my cosigner. I am behind on that (since it's still my problem) at about $900. What is your min. payment.

My mom lives with me. We share our income, but truly only do that because 5 years ago, it made sense. Now we realize our co-dependency issues and want to separate. But don't know how. I think these need to be current before you can separate finances. Otherwise it will be very, very messy.

I have a car loan for about $2k (my mom drives that car) and she has a car loan for about $7k for her car (that I drive).

I am behind on every single bill I have. And they are all "regular" bills. No credit cards (obviously after BK) anymore. Since my mom and I share expenses, hers are mine and vice versa. And that has not been working out lately...for awhile.

She is normally on unemployment (she is a construction flagger) and gets paid weekly ($1680/month) and I get paid bi-weekly ($2400/month) I am confused by this statement. Is your mom on UE now? If she has gone beyond her benefit time then you are in deep doo-doo as far as the bills go. Is she just out for medical time? When can she go back to work?

My mortgage is $926 (due on 1st, but don't pay until end of month since behind)Some people have found that they can get one payment pushed to the back of the loan. If you are able to keep up with the "pay at the end of the month" it may be time to try that. Then this bill would be caught up.
Car (one I own) is $250.60 (paid off in July or August I believe)(about two weeks behind)More confusion. If you owe about 2k on this car, how can you pay it off by July or August at $250 a month. I am thinking closer to Christmas or Valentine's Day
Car (mom owns) $213.16 (about two weeks behind) How much is this car worth? Also the other one. You may find it an advantage to sell one or both.
Cells are about $120 (behind)Do you have a contract for these phones? Can you go to Boost/straight talk? Can you get rid of one if mom is home and you have a magic jack?
House phone is MagicJack
Insurance for both vehicles is $147 Call around and get quotes. Do again when you make changes to car situation.
Direct TV is about $80but bill is about $250 since behindAre you under contract? I would ditch this and keep the internet. If mom is staying home with her hip problems, I would teach her the joys of hulu and other websites for tv.
Internet is about $50 If you can lower this by calling or switching companies, even for six months, do that. Otherwise 50 is usual for internet here in the pacific NW.
Mom's medical after hip surgery is roughly $2k Sadly since the doctors aren't coming to take the new hip away, this bill will go to the bottom of the list. I am not saying you shouldn't pay it, just that you should feed mom and keep a roof over her head first.
Mom's union dues are $20 (but owe about $80)She has to pay dues even though she is unemployed? And ill? Call the union headquarters and see if there is a clause in the membership papers that would give you some relief.
Electric is about $120 (but bill is $511 minus $150 JUST paid an hour ago) Again, this will be top priority. Call and make arrangements when you can. Pay something every month. And more than the current month. You will find a lot of tips here on how to lower this.
HOA is $72 (but wayyyy behind)I don't have a house much less HOA so I don't know how to rank this...

So anyways, that is a look at my situation. I have no idea how to catch up. I want to start putting aside some money so I can get a smaller apartment closer to work (I live about 30 miles from work and it's awful), rent out my house and mom wants to move to Arizona.

I was never taught how to deal with money and never took it upon myself to learn sadly. Mom was never taught either. We used to have a lot more money. Sadly, things changed.

I really, really, really need help. :jug::smhelp:

I keep hearing about the Dave Ramsay "way", but I can't even afford to buy his stuff! And I am sure I am forgetting some bills. I am drowning and have no idea how to swim.


About Ramsey....Library. Library. Library. Also there is a list of the baby steps here as well.
First you have to get current on your bills. The four walls first, house, food, trans, to your job and enough clothing to cover your nakedness.
Then get an emergency fund of a thousand dollars. Then pay off old debt.

I would plan on about three months of austerity. Eat out of the cupboards. If mom doesn't have any income, I think you would qualify for some food stamps. Look into the angel food ministries esp if neither of you cook. (And learn to cook!!)

Ask about carpools. Look into public transport. See if you can go to one car at least for the summer.

Can you raise your income during those three months? An extra part-time job for the summer? If your mom is not working, and could she watch a couple of school age kids for the summer? You can help her plan some activities for them so it doesn't get to be too much.
 
#4 ·
HOA I would move to the bottom but above the medical. Read your HOA rules regarding non payment. They might want to take you to court, they might be able to put a lien on the property, but if you are not selling that would not matter.

Maybe call them and let them know what is going on and that you are working on it.
 
#5 ·
Get the Ramsey stuff from the library.

I would ditch the cell phones, Satellite TV and internet. Well, you may have to keep the internet since you are using magic jack.

Use the money from that to start getting caught up.

Ask about getting on a minimum payment plan for the medical bill.

Have you considered picking up a second job? Is mom looking for work? You're both going to have to put some effort into getting through this.
 
#6 ·
Off the top of my head (I'm no number genius)
You and mom need to disentangle the finances. ASAP. Can you pick up an extra job? Can she find work?
TV~gone
Phone~downgraded if possible
How long left on the car and what is it worth? Could you get out from under if you sell it?
Contact about medical bills, check into a hardship payment plan.
Contact the electric co. Lights are a must.
Get the Ramsey stuff from the library, check out this site and google other things. You need a budget, yesterday! It feels hopeless but it's not, it just takes a while to figure it out. :hugz:
 
#7 ·
I really appreciate the advice - I wanted to just throw a few things out there...

My mom works whenever the union calls...it just hasn't been much lately. She does receive $420 weekly for unemployment. And that definitely helps.

I currently take a vanpool to work and back everyday, however I still live 12 miles from the pickup - and there aren't any buses or anything like that that run out in my area...it's a super small town and I have no idea why I picked THERE to live. (GAH!)

The car that is in my name is to be paid off in about July or August. (my mom drives that one and it's great for construction work) And if we disentangle our finances and move separately, we both need vehicles. So selling one is not an option. And the one I drive (mom owns) that has several grand left on it is under great terms, but definitely not worth what I owe. It's a good vehicle, a 2002. I had "returned" a 2011 Jeep that I had...it went on my BK.

As for a second job, I am having a hard time with that. I take the vanpool from my little town and it wouldn't make sense (gas wise) it seems to find a job where there IS one, which would be definitely NOT in that town. And that does SUCK. We have so many places shutting down there that it's ridiculous.

We definitely want to keep the internet for the MagicJack, and we receive NO reception for cells where I live. My mom and I are under the same cell contract, and she HAS to have her phone for work. And if I decide I don't want mine anymore, then they charge us $300 and until we pay that, they shut hers off as well.

HOWEVER... After being on this site for HOURS last night, I have decided to give the envelope system a try. I might have to modify it a bit, but I know we can do this. AND I read one of Greebo's (sp?) posts, and I realized I am not a number...I am NOT my credit score. And I think that was a huge burden. I now know I am just me, and that I need to get my financial life on track so that I don't ever have to rely on credit again. Everything needs to be cash. I will need to make adjustments, and I will whine and complain, I am sure...but with all of you smacking me around a bit - I know I can do this!!! :cheergrl:
 
#8 ·
Can you look back to your bankruptcy and see where you've gone wrong post-bankruptcy? What did Schedules I and J look like on the bankruptcy? Did you have a negative cash flow at that time? Looking at your history and the why's of where you are today will help you formulate a plan/budget going forward. Otherwise, you will likely continue to repeat your mistakes. It's not just about the dollars. It's about the way you think.

I would suggest you write down every penny you spend for the next month. Often times the pennies (well dollars in today's world) are the key. You cannot change the fixed expenses like house/car loans, but you can do whatever is necessary to reduce everything else. Stop eating out. Do not buy bottled water or soda or coffee away from home. Do not buy clothing. No movies or other entertainment. Look at every expense and try to find a cheaper way. Turn the heat down and the a/c up. Simple things like not leaving water run can save at least pennies.

Once you get everything down to basic minimums figure out how to keep everything paid each month on time. Late fees waste precious income. Then when you know how much you have available contact each creditor and set up a plan to catch up on their bill.

Consider selling your house if you have any equity. Use the equity to catch up bills, pay rental deposit for apartment or apartments if you and your mom are separating. BUT do not do this until you figure out why you're in this mess and how you're going to change so it won't happen again. Ideally you would have done that at the time you filed bankruptcy but since you didn't then you can do it now. What you do not want to do is waste the equity on the same old same old. You want to use it to build a new and better future. Does your mother have 401-K funds? If so, she might be able to borrow from it to pay her medical expenses. Again, do not do so until you have a spending plan worked out or the money will be wasted.

At this point I think its likely you and your mother need to work together to get your joint finances straightened out. Two incomes in one household will go much further than two households with one income. I'm assuming she's on-board with your goals to get finances under control. Once the current situation is under control then you can work together on how to manage separately.
 
#11 ·
I think where I have gone wrong is that I don't use cash. I let my money hide behind my debit card. It's the out of sight out of mind...and no idea what is actually in there...mentality.

I have no equity in my house - flip flopped by about $30k. But I could rent it out potentially for enough to cover the mortgage AND the HOA fees. I just have to get the floors fixed. I found some laminate flooring at the Habitat for Humanity Restore - EXTREMELY well priced. I would just have to learn to lay it. Which is still better than hiring someone maybe?

I made a mistake on my one car loan numbers - I owe about $600, and not $1800...so it will be paid in July-ish. Which is awesome.

I want to go to a more basic cable, but how does that even work? I am still in a contract, so I can't yet anyways. But eventually it sounds great! But how do I do that with no company? So confused.
 
#9 ·
Get mom a tracfone for work. It will cost way less than your monthly cell plan, for an entire year of service. Then abandon the two other cell phones.

If you both get tracfones you can dump the internet and magic jack too.
 
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#10 ·
If it wouldn't cost us $600 (both phones on family plan) to get out of the cell phones, I would. But even WITH cell phones, we have no cell service at home at all. So we have to have a landline. And the ONLY company that delivers internet charges $25 for the absolute basic service. No add ons. And they are our only internet as well. Total monolpoly over the area.

I do like the idea of getting the no contract phones...a lot! I just have to wait until 2012 to get out of contract. Sadly.
 
#12 ·
Get rabbit ears for the TV, costs like 15 bucks with no monthly charge. I also do Netflix for 10 bucks a month for any movies or seasons. Lot cheaper than paying for cable...

What worked for me was using cash and money orders for everything. That way I know exactly how much money I have and once I've spent it, it's gone. This has helped me big time with those insane overdraft fees
 
#15 ·
Rabbit ears? You mean the little antennae thingymabobbers? LOL That sounds good!

I like the idea of money orders as well - you have to have cash in hand and no overdraft fees.

Although, right now it seems I don't have money for anything...I realize that I need to get caught up on my house payment AND THEN worry about the other bills. That is something I am lacking right now. I always pay the smaller stuff, and ignore the house. Sad, huh? (stupid?)
 
#13 ·
When you get your budget worked out you may find you do not have the money for cable or internet or many other things. You're in a tough situation and it is going to require some tough decisions and sacrifices to turn it around. I'm amazed you were not advised to surrender the house in bankruptcy since you're upside down on it. Did you reaffirm the loan? If not, you maybe can walk away with no worries about a deficiency. Don't know about HOA fees tho.
 
#14 ·
I know that the mortgage folks sent me documents saying they "will no longer be requesting money from me due to BK" and I can't pay on their site anymore...something to do with my BK as well. Which is fine. I just pay through my bill pay from the bank.

It is a tough situation. And I will be honest - I am not good at sacrifice when it has to do with something that effects my mom as well. But I know she will do whatever it takes too.

We need a turn around on this.
 
#17 ·
As a first step while working out your budget, promise yourself you will absolutely not go further in the hole. That means no overdrafts, no charges, no borrowing from anyone and paying bills on time. In other words get real and honest with yourself. If you don't get real you are hurting yourself and your mother's future. It doesn't make sense to sacrifice your/your mother's futures in order not to make necessary sacrifices today. Getting real is probably the hardest part because it means facing the problem and what behavior caused the problem.

Remember its much much harder to climb out of the hole than to fall into it. Also, the first thing to do when you find yourself in a hole is to stop digging.
 
#21 ·
The "bankruptcy" wouldn't ask you to surrender anything. The Bankruptcy Judge might refuse to allow a reaffirmation if you didn't show you could make the payments but that's about the extent of being asked to surrender anything. What I was referring to was you voluntarily surrendering collateral in order to eliminate secured debt. You surrender the collateral and the creditor doesn't get anything else. If someone loses a home in foreclosure, then they usually have a deficiency to pay if the house sells for less than the amount owed. I always explain this to clients and tell them surrender is an option in bankruptcy. Obviously, its a choice only they can make but many times clients decide they'd like to come out of bankruptcy without any debt so they do surrender collateral. Sometimes that isn't their best option so they don't. Its an individual decision.
 
#23 ·
Hmmm....
maybe you should make copies of the info they(mortgage company and BK court) have sent you, make up a big pot of coffee and spend some quality time organizing the paperwork in chronological order and reading them through.
Then take a pen and highlighter and mark up everything you don't understand that they have written. Then figure out who you need to ask so that you do understand what is going on. Once you know what is going on then you will have a clearer idea of what your options are.

As someone has said it may be better to get out of the cell phones sooner rather than later. If you don't think that you can support it in the long tern, cut your losses now. That is part of planning for your money. You have to look ahead and try to ward off future problems.
 
#33 ·
Actually, it's a good idea to call occasionally, anyway. I had a 1.5 MB internet service. I called the phone company, and they said I could have the 7 MB service and a new modem for the same price I was currently paying. There would be no other costs incurred, and I didn't have to enter into any sort of contract with them. If I wouldn't have called, I would be getting less than my money was worth.
 
#34 ·
I really appreciate everyone's help!

Yesterday, I took the first step to create a budget. A real one. Where I layed out how much PER check (for me and my mom) would need to be put in each envelope to pay the bill. To see my mortgage broken down, my car payments, etc...it really made a big difference. Rather than looking at it as a huge lump sum, it made it all more realistic...and you know what's crazy?! The fact that I SHOULD always have enough to put away in savings and EF! I haven't been able to, but this budget would allow for that! I even included money set aside for blow money, dining out, etc!

I CAN DO THIS! :grwave:
 
#35 ·
Good for you. In all of this frantic advice to you I want to know a quote to remember by Dave Ramsey.
In my set of DVDs he says:
"I don't really care WHAT you spend your money on. I am going to give you some good ideas but if you can just NOT spend more than you make and do this (the budget) Every month, On purpose, then I am okay with that."

No matter how crazy life gets or how low the money gets, if you have a budget and you know where the money is going and are MAKING it go there, life is better.
 
#36 ·
You may be thinking, 'Well I need to start my emergency fund now that I have a budget" - and that *would* be nice to start right now - but that's not what you need to do first.

Instead, since you're behind on some bills (I think you said you were in another thread, right?) - now that you have your budget in place, every penny you can spare should be going to get you caught up and current.

The costs associated with being late on payments can be crippling. The fees rack up and right now saving up $1000 for an emergency when you can be losing hundreds a month or more in late charges would be counter productive.

When you're behind, your budget bleeds. That alone means you ARE in emergency mode. So don't save up EF money *until* you're back to the point where you're current on all your bills and with all your active debts*.

---

*Active debts vs. sleeping debts is a different topic - dunno if you have any debts that are far enough behind to be sleepers - they'd be debts listed as outstanding on your credit report but where they aren't actively contacting you right now cause they've given up on you.
 
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#37 ·
Ok, so I need help. I am reading through all of these, but I need advice that is personalized for me. Because I can't seem to "get" it. And I keep saying "if only I could have someone tell me exactly what to do!!" So here goes...And this will be WAY too much info, I am sure. But I REALLY need help.

I am 30 years old and I own my home. (I owe $172k, and worth about $150k)

I filed bankruptcy in November. :pdoff:

One of my loans (for about $6k) is now my mom's sadly...she was my cosigner. I am behind on that (since it's still my problem) at about $900. (what is the minimum payment?)

My mom lives with me. We share our income, but truly only do that because 5 years ago, it made sense. Now we realize our co-dependency issues and want to separate. But don't know how.

I have a car loan for about $2k (my mom drives that car) and she has a car loan for about $7k for her car (that I drive).

I am behind on every single bill I have. And they are all "regular" bills. No credit cards (obviously after BK) anymore. Since my mom and I share expenses, hers are mine and vice versa. And that has not been working out lately...for awhile.

She is normally on unemployment (she is a construction flagger) and gets paid weekly ($1680/month) and I get paid bi-weekly ($2400/month) (total income per month is 4080)

My mortgage is $926 (due on 1st, but don't pay until end of month since behind)
Car (one I own) is $250.60 (paid off in July or August I believe)(about two weeks behind)
Car (mom owns) $213.16 (about two weeks behind)
Cells are about $120 (behind)
House phone is MagicJack
Insurance for both vehicles is $147
Direct TV is about $80but bill is about $250 since behind
Internet is about $50
Mom's medical after hip surgery is roughly $2k (minimum payment?)
Mom's union dues are $20 (but owe about $80)
Electric is about $120 (but bill is $511 minus $150 JUST paid an hour ago)
HOA is $72 (but wayyyy behind)

So anyways, that is a look at my situation. I have no idea how to catch up. I want to start putting aside some money so I can get a smaller apartment closer to work (I live about 30 miles from work and it's awful), rent out my house and mom wants to move to Arizona.

I was never taught how to deal with money and never took it upon myself to learn sadly. Mom was never taught either. We used to have a lot more money. Sadly, things changed.

I really, really, really need help. :jug::smhelp:

I keep hearing about the Dave Ramsay "way", but I can't even afford to buy his stuff! And I am sure I am forgetting some bills. I am drowning and have no idea how to swim.


If my calculations are correct, your household income is $4080

I calculated you minimum payments as follows:

Mortgage 926
Car (one you own) is $250.60
Car (mom owns) $213.16
Cells $120
Car Insurance $147
Direct TV $80
Internet $50
Mom's medical $100/ month
Mom's union dues $20
Electric $120
HOA is $72
Loan you owe to mom $300
Gas for cars ???? (300)
food ???? (300)
water?
natural gas?
___________________________
total minimum payments for month 2998.76

this leaves you with a surplus of $1081.24

I would pay
overdue union dues (60)
electric (361)
direct TV (170)
________________________________
total in back fees 591

save the remaining 1081.24-591= 490.24 for bringing loan current next month

then next month, total income is 4080
minimum payments 2998.76
remaining 1081.24 + 490.24 (surplus from prior month)=1571.48
bring loan current (900) and HOA fees current (??) and cell current (???)
this will bring you current on all bills.

the next month, increase the amount to medical and loan.
 
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#38 ·
the most important thing to pay for is the roof over your head, food, electricity and transportation to work. Everything else is second. Get rid of things you don't need cable etc, can you make it on one car?
 
#40 ·
I have to agree with Greebo about lowering all over due payments. The late fees alone can cause havoc to a budget. So for the next two months buckle down and tackle the debts. This means both you and your mom will avoid spending money where not needed. Meaning not going out to eat, blow money, purchasing an item just because. It may seem harsh but two months to get your finances straightened out and you life off of a financial rollercoaster is nothing. Many of us here have done the same for years just to get financially sound.

Think of it as a team effort to get you finances straightened out. Maybe by the third or fourth month you can save enough to get out of the cell phone contract and be able to downsize the cable. Many people use the internet to catch up on tv.

Once you establish a budget and pay down the debts no matter how difficult it seems you will relish every time you see the progress you make.

Hang in there.
 
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