Where Do I Even Start?

[disneysteve]

Mortgage and HEL:
- I have looked into refinancing with our current lender and have been told that there is not enough of a difference in current rates (home is at 5.25% and HEL is at 11.25%) for it to be beneficial. Note: our current HEL rate is 10.66%.

I can't believe you can't do better than almost 11% on your HEL, but I guess it depends on your credit score.

Day Care:
I'm surprised at the criticism I've received about the costs we pay for day care.

If the person providing your day care was professional hired help, that would be one thing, but I think the reason so many of us commented on this is because it is your mother you are paying. My mother took care of my daughter plenty when she was younger and would never even dream of accepting payment for caring for her own granddaughter. Maybe gas money or bridge tolls but nothing more than that (and I know my mother wouldn't even have accepted that).

The fact that she retired to provide your day care does change the story a bit since she is dependent on that income. That makes negotiating kind of awkward, but if she knows you guys are having financial issues, perhaps she'd be willing to accept a bit less. Even $50/month less would help out.

Congrats on taking on this situation so quickly. I think you'll be fine.

[poohstixx]

Please note...my mom retired EARLY to help us with childcare. She made a large sacrifice for us and we made an agreement on what she would be paid as she still needs some income. She LIVES with us 5-days a week...that's 5 days a week she could be living care free, but has taken on the responsibility of caring for my children because she loves us. I don't have to get up early to get my kids ready for day care, don't have to bundle them up to take them out in the middle of winter at 7am so I can drop them off to go to work, they don't have to stay with a "stranger" all day, they don't get exposed to hundreds of illnesses in a day care, I never have to take off work or leave early if a child is sick (although I do sometimes for personal reasons), she makes meals for us, she does some laundry, she takes my kids to playgroups, she gives them love and care that is absolutely priceless...I think it is reasonable to give her a measly $3.33 an hour (we leave by 7:30am and return by 5pm) to give my children care no one else could possibly provide while my husband and I work. She is extremely flexible and will accept less from time to time if we're in a bind, she will buy groceries and never expects a dime in return. So as you can see, I'm not paying her $30/day JUST for day care.

I really don't mind the suggestions to explore the possiblity of paying my mom more, what I do mind is the judgement attached to the fact that I am paying her at all. Taking care of a 6 and 3 year old boys 9 hours a day is a ton of work. I don't pay her because she makes me or asks me. I pay her because I told her I would, because she has already made many sacrifices for me.

[disneysteve]

poohstixx, I totally agree now that we know the situation. Your first post didn't mention that she left her job in order to provide your daycare. That's a totally different situation than what some of us probably envisioned (that's what happens when you assume). Basically, you hired a live-in nanny who just happened to be your mother in a situation that is beneficial to everyone involved: you and your spouse, the kids and your mother. Nothing wrong with that.

[KTP]

Does your mom have her own house? If she really is spending that much time with your kids and enjoys it then it could make financial sense for you to move in with her and increase her payment by some amount and set the rest aside for a future larger home when your kids are all old enough to be in school all day (and not need daycare).

In this case it could be reasonable to short sale your house if you can get out of it debt free. Then you could live with her, have her readily available to take care of the kids, and all of you would have more money.

[ceejay74]

Sounds like you have a really great plan and should be able to clear up enough room in your budget for accelerated debt repayment or savings. Congratulations for taking the useful stuff on board and not getting scared away by some of the judgmental stuff. It happens when you open up to strangers (has happened to me here), but if you can tune it out there's lots of useful info to be had. (And as DS said, most were not trying to be judgmental but just making assumptions based on the info at hand.)

Good luck to you! Oh, and might I put in a plug for starting a blog here? It's been instrumental in helping me pay down debt and get on track.

[lovcom]

So if a poster disagrees with your set up, they're being "judgemental"?

Look, you came here and asked for responses, and you need to expect that not all responses will agree with what you're doing. To complain about "judgemental" posters is most peculiar, to be sure. Did you really think we all would agree with the way you're handling your situation?

I think you need to grow a thicker skin, and try to see the point certain "judgemental" people are making, because there might be a point you might need to consider.

As to your mom, it seems like you're providing her food, shelter, and the company of her grandkids, so she should not be accepting any payment from you, or at least should stop accepting when she sees that you're in a bind. My 78 year old mother would never accept a dime from us if she was in the situation your dear mother is in.

Also, I would suggest that after the baby is born, to implement a good and dependable contraceptive program, as you can't afford another mouth to feed.

Does your mom have her own house? If so perhaps she can rent it out and get income that way, or sell it.

One more thing: How come your mom gets the boys ready for school in the morning? Aren't you still home at the time, and if so, you should be doing this. Weekends, does your mother get Saturday & Sunday off? I ask these because I'd hate to hear that the primary "mother" of your kids are her and not you.

Best of luck!

[graceful]

To the OP,

Kudos to your Mom in making the sacrifice in retiring early and losing her primary income in order to do her best to help YOU and your family. And kudos to you for not taking her and her sacrifice for granted.

I think that if she was ALREADY retired and was doing this as a "favor" then money would be "extra." But it sounds like she GAVE up income in order to do you this favor and needs the money to maintain her own household.

I actually have friends that do this. They pick up the wife's Mom from LI every week and she stays with them during the week in NJ to provide childcare for them. Grandma goes home every weekend because Grandpa is still there and so is the wife's younger siblings. She has her own household to take care of as well. I don't know what their financial set up is.

Sometimes, it is difficult to "merge" households. Totally different states and school districts, etc. But if the situation was soooooo severe, it certainly is the best option. But it doesn't look like it is necessary in this case... yet.

Best of luck in trimming all the fat in your budget, living within your means, and achieving financial freedom but above all wishing you continued health and a loving family.

[poohstixx]

So if a poster disagrees with your set up, they're being "judgemental"?

Look, you came here and asked for responses, and you need to expect that not all responses will agree with what you're doing. To complain about "judgemental" posters is most peculiar, to be sure. Did you really think we all would agree with the way you're handling your situation?

I think you need to grow a thicker skin, and try to see the point certain "judgemental" people are making, because there might be a point you might need to consider.

As to your mom, it seems like you're providing her food, shelter, and the company of her grandkids, so she should not be accepting any payment from you, or at least should stop accepting when she sees that you're in a bind. My 78 year old mother would never accept a dime from us if she was in the situation your dear mother is in.

Also, I would suggest that after the baby is born, to implement a good and dependable contraceptive program, as you can't afford another mouth to feed.

Does your mom have her own house? If so perhaps she can rent it out and get income that way, or sell it.

One more thing: How come your mom gets the boys ready for school in the morning? Aren't you still home at the time, and if so, you should be doing this. Weekends, does your mother get Saturday & Sunday off? I ask these because I'd hate to hear that the primary "mother" of your kids are her and not you.

Best of luck!

I came here for advice about personal finances, not people's personal opinions of my family. One of us must be in the wrong place. A totally uncalled for post.

[Snodog]

I have nothing to add more than what some of the others have said. Just wanted to wish you good luck! It can be tough out there for young folks but you will make it.

You will find that over the years if you do well at your jobs your salaries will increase and things will get easier.

[buildmybudget]

Pooh, honestly you need a budget that will:

1) show you where you are heading financially
2) how you can save and the impact each decision to cut costs will have on your budget and the speed with which you can pay off your debts
3) how to manage your cash flow so that you can juggle all of these expenses without overdrafting your account
4) help you build the discipline to stick to your budget

All of this advice is worthless if you fail to make necessary changes and if you can't find a system that works for you.

[minnie1928]

The only thing I have to add to your wonderful list is to track your progress. Make a chart or list the debts by date and balances...something. Once you see that you are making headway then it will inspire you to continue on that path.

Good luck! I think you are heading in the right direction!

[Seeker]

I need some advice on what to do! We have a ton of money going out which leaves us with little for food, gas, etc. and we're quckly falling behind! Not to mention we often get slapped with overdraft fees in our account, because we struggle to keep track of what's going out, timing with bills, etc.

I'm responding to just the one paragraph because it sounds as if the other issues are on the way to being explored and organised.... but I'm curious about the above.

How are you and your SO handing the paying of bills? Do you keep them in one place until ready to pay? Do you keep a list of all amounts spent? Maybe even at the top of the list the amount you have budgeted for all the bills and then keep subtracting out the amount as the bills come in?

For day-to-day expenses, it sounds like you're not operating from credit cards, but gone to debit cards instead? Is there a problem with both of you using cash temporarily at least, until your get a handle on the above?

It's (unfortunately) the little day-to-day amounts that are spent that quickly eat into the available $'s (after bills) left over each month. Reducing the monthly bills (storage, phone, etc. as has been suggested previously) should help somewhat, but you still need to protect yourself from overdraft fees, if you're both not on the same page financially and you don't know who is doign what as far as spending/paying the bills.

[poohstixx]

Check out my blog on this site, under poohstixx, to see how I'm doing! I can't post a link until I've made 15 posts, I guess I'm not quite there yet!

[lucmas]

Well first off, are you paying your mother the $600/mth for child care? Perhaps she can give you a break if she doesn't need the income so that you can gain some breathing room. I think it might be difficult, but you need to cancel whatever cable you have and one of your phones. Then clear out your storage unit by having a garage sale and close the storage unit. This is just the tip of the iceburg, but I think you can get through this as long as you build and stick to a solid plan.

[snafu]

Second Jobs:
My husband receives regular business doing photography, mostly through friends and co-workers. This comes at little to no cost to us, except his time which is by no means a lot. I received some criticism about this, but so far there have been very few negatives and financial cost to us as his business is becoming well established and he has several repeat customers.


When I add up the facts and your acknowledgement that you have made poor financial decisions in the past...I point out again, your husband has the option of seeking some part time work to enhance family income since his business does not take up a considerable amount of time. It's great to operate your own business and be self employed but it's pretty self indulgent when you need to dig out of a self created financial hole. His ego needs to deflate while his contribution to family income needs to inflate!