You're doing great with the 1st step of acknowledging and the next which is finding out where the 'problem' lies. Like carrotsmakemefat said, you may just have a problem not knowing where your money goes!
I love What's The Cost, it's a site that has a debt snowball calculator. Knowing how much you owe and APR's can really be freeing. NOT knowing is scary! Once you can see it all laid out, you can tackle it!
the people are the Money Matters board may be able to help you more. There is a lot of financial knowledge over there, but you have gotten a lot of good advice here, too. You may find yourself, come Monday, feeling a lot better.
I would, personally, tackle the CAR issue this weekend. There is no reason you need to be making $800 in car payments a month. Even if you are upside down, you can get out of the cars, in to something cheaper but reliable, and be making a much smaller car payment. This is a FOR NOW change, not FOR LIFE change. Do with less today and you can have that 'want' back when you are out of debt.
Post by jennistarr1 on Oct 23, 2014 10:25:54 GMT -5
are you deducting medical expenses in taxes? I would sign up for a FSA account if you don't already have one. And then any expenses you spend on medical care above that you can claim on taxes.
Can you change electricity providers? I'm also in DFW, we had Reliant and were paying between $270-$370/month. We switched to Ambit at the beginning of September and our first bill was $79.
If your child has a chronic medical condition or disability, non-means tested (no income barrier) Medicaid could be secondary insurance for him alone. I know families who do it as the only insurance when dad and mom are covered individually under employer policies. Texas could be a problem, I think they tend to have a wait list- but do contact your state or the social worker at your hospital about this. It's federal funds but states can administer them as they see fit.
They can fill you in on CHIP- it may be free depending on your income or it may be at a reduced cost. It may be a more comprehensive policy than what your DH has.
Also, don't forget to deduct these expenses come tax time if you can. The new limit is 10% of AGI. This is anything medical or dental including the breast pump, copays, deductibles and mileage. DS has ASD and a lot of his services weren't covered even by DH's awesome insurance. We even used the medical deduction for tuition at a private school for kids with dyslexia.
I'm afraid I don't know a lot about taxes - but you can try using the withholding calculator to see where you will end up and make adjustments as needed.
I agree with selling the cars, they are too expensive for your current budget. Our income is right around yours per month and we have no car payments, and I don't see how we would fit them in at this point (especially not $800 worth). Having to cover the amount you're upside down would still be preferable to having to make those payments each month.
Dave Ramsey is great for getting out of debt. I listen to his podcasts for the success stories. It's amazing what people have been able to dig themselves out of. I think you can do it too. You make a good income, and if you can lower some of your fixed expenses it would really help. How much equity do you have in your house? Would it sell quickly in your area? You might consider downsizing, or refinancing to lower the payment. We refinanced our house two years ago when DH was out of work and lowered our payment nearly $500 per month. I might also consider suspending your DH's 401k contributions until you get some of this debt cleaned up. At the very least, it would help get the underwater amount on the cars paid off sooner.
Cable needs to go. Get a Roku and a Netflix subscription, and find the cheapest internet service available. When we need to tighten up, cable is the first thing to go. We add it back when money gets a little fatter, but as working parents the amount of TV you watch can't possibly be more than an hour or two a day, which just isn't worth the money.
The advice you've gotten that I've made it through so far is good. I would suggest downloading the You Need A Budget software. You get a full-feature 34 day free trial, and there is usually a sale or promo code for a big discount to buy the program. I started using it on September 1 after completely devouring the YNAB podcasts, and it has been extremely eye-opening to see where our money is actually going. It's a zero-based budgeting plan, where every dollar is categorized as soon as it comes in. Each purchase is logged via the app or desktop, and you see how much you have left in the category. I was literally in slacked-jaw shock at how much we were spending at restaurants after the first month. I also had no idea we were spending so much on fuel. Now I can adjust the budget to accommodate the higher fuel costs, and keep track of my spendthrift DH's wasteful purchases and categorize them as his walking around money instead of pulling them from the household budget.
Good luck to you. Please come over to MM for advice and encouragement whenever you need it. It's really helpful to see your budget through unbiased eyes.
We are in TX also and we have Metlife for a bundle of car/home insurance and it is WAY cheaper than State Farm and several other companies we shopped. As Curly said, USAA is also good if you or your parents have military service. I second shopping your electric...there can be a HUGE difference in providers' costs here in TX if you are eligible to switch. Tracking all expenses to plug budget holes, shopping all services you currently have, asking for discounts/medical assistance, explore selling cars, do it all! I hope things get better for your family soon. Good luck.
Do you have to be on your H's insurance? Can you look at alternatives through the ACA?
I'm not sure what aca is?
I am on my own insurnace through my company which is ok but suuuuper expensive. Ds is on h's ins but we are waiting to hear about the new plan since his company merged with a bigger one. Hopefully it will be much better. Right now his deductible is $7k, copays $65, 30% in network out of pocket and family max of $15k which we are about to meet.
We do not qualify for state aid.
Two things on the insurance/medical.
have you looked in to whether your DS qualifies for SSI or other state funded programs that help middle, and sometimes even high income parents with children with high medical needs (I have not read all the post. You may have explained this). My nephew qualifies for some assistance from their state (SC) and also qualified in GA due to his high medical needs (heart defect). My brother is in no way poverty stricken. I don't think they take advantage of the program anymore, since they have good insurance now, but they did when they didn't.
Also, if your medical cost exceed x% of your income, you can deduct them on your taxes. I used to do this when I made about $12k in reportable income, and paid $2.5k in health insurance, plus deductibles, so if your spending $16k, and make $80k, this might help you a bit.
You out also might talk to the doctors directly. My cousin is a pediatrician and frequently "forgives" or lowers middle income parents with high deductible insurance their bills because, unlike people who make less and get aid, or people who make more and can, they really can't pay, and delay treatment as a result.
But let's say you do it with the trade-in values and you end up with a $12K loan to cover the difference in value. Then you buy 2 cars for $10K total. A $22K loan with a 5-year term at 5% interest will be $417/month. That cuts your car loan bill in half.
Here's a calculator so you can play around with actual rates.
@pancifoot- are you and your DH filing separate tax returns? If so, why? It's very rarely advantageous for couples to file separately. Married filing jointly is more beneficial for the vast majority of people.
No, we file together, it's just for the deductions on our paychecks, only one of us can claim the baby, right?
It doesn't matter for paychecks. If you're getting a refund, you can still adjust your withholdings. There is a calculator on the IRS website you can use. If you are getting a bigger refund, adjust!
Post by emoflamingo on Oct 23, 2014 15:58:47 GMT -5
I'm not sure if it's the same for every state (regulations wise), but insurance rates in Kansas vary based on credit as well, so that can affect whether or not USAA is cheaper for some people than others.
ETA: Looks like an esurance website says that only Massachusetts, Hawaii and California don't take credit score into account.