My Debt Blog

I’ve been debating for a few months of switching things up with how to handle the finances. Right now my wife and I only have one joint checking account where everything goes in, and everything comes out. While this has worked for quite awhile, it does create a challenge when one of us needs something or wants to do something, yet the bills have to be considered too. I know some people who do a yours and mine account and pay for half the bills. While it may seem to work for them, it feels very separated instead of working together.

The idea I had was to have three accounts, a sort of yours, mine, and ours type of thing. Paychecks would be deposited into separate accounts and then a percentage of the monthly costs would be transferred to the one in the middle. The only question is when it comes to personal debt we both have, should those be considered a joint expense? I make quite a bit more than my wife is currently and if this were the case, I think she would have trouble keeping up with her payments. That would be the point where I feel she would begin to think that this is unfair to her and wanting to go back to the old way.

If we combined all our bills and household expenses as they are so we have no individual payments, roughly 70% of each of our income would take care of this. This would leave us each with the remaining left over. I would have several hundred per month and my wife only a few hundred left over. Since I naturally don’t live in the moment, but rather the future the bulk of ‘my’ money would go directly towards getting us out of debt.

Sometimes the best thing is to do nothing at all and leave it the way it is. Joint account just means we need to both work together to manage the money and meet our wants and needs. The basics just always have to come first like food, shelter, utilities, clothes, and transportation. Beyond this basic structure are luxuries that we choose to have: HDTV, cell phones, Internet, and the like. We also have the credit card debt we’re working on, and the student loans that have to be paid back. I’m just weighing the options here openly on the blog as thinking out loud. Feel free to leave a comment on the subject.

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My birthday was about two weeks ago and something I have wanted to try out was Quicken 2008. I had looked at this software for a few months and considered buying it near the tax time because of the rebates and such. When my birthday came around, and I don’t want or desire much, I received a copy of Quicken 2008 Deluxe. Installed it, got our primary accounts setup, and wondering where to go from there.

This weekend we went to Borders bookstore and I bought a guide on how to use Quicken. Going through this book I have made a lot of progress in the program now. I have entered all the transactions for May and up to the weekend for June, and am tempted to go back and manually enter stuff for January to April to track things on a YTD basis. What I really like about this program is the ability to easly see cash flow for the month. It has the income and the outgo boxes showing what income to expect and an idea of the bills and such, then it shows what is left over we could save (or use to pay off debt).

There is a budget feature in the program, but with only one month in there I’m not sure how it will calculate things. Plus a budget should not be a template that is going to be the same month to month. We haven’t had much luck with a budget, but things were easier to lay out when I put the bills in a list. This makes things rather clear when the bills come in, how much we have to spend to pay them, and then what is left over. One thing I think that Quicken will help us with is the ability to at least track how much is being spent on clothing and eating out.

Doing some quick math on what my wife will make from her summer job, it will be slightly more than what she currently earns at her current job. The flipside though is it will cost more in gas to get to the new job, so this will have to be tracked to see if there is any increase. If there is an increase it will help us pay debt and save more, as long as we keep things relatively the same as they are today. I’ll see if I can get a pie graph or something with where we are spending our money.

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I never like getting to January in that the damage from Christmas is actually felt this month. It has been a difficult month to get through on one income on top of that. With no EF or additional income, it is getting increasingly difficult to keep focus. As the pressure or weight of carrying everything gets to me, it gets harder to keep going. I’m to that paycheck to paycheck point and there is nothing to show for it.

So if January was bad, how does February get better? We need to pay close attention how much is coming in, and what needs to go out. My wife will also be setup to help with our household income, even though it won’t be permanent yet. Spending is the single most important issue that needs to be watched very closely.

Getting through February is important because I’m patiently waiting on my bonus. The bonus does not necessarily fix problems, but it will help turn things in a much more positive direction. I can’t post details yet because it isn’t in hand yet. Priority before paying down debt is to get that EF back to 1k though.

Expect my regular monthly plastic pinch update and my net worth update. I might as well point out that debt is going up and net worth is going way down, partly due to the huge hit I’m taking on my retirement savings. Even though it is only Monday, I cannot wait until Friday comes around.

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I’m actually glad it’s a Monday for a change. Friday is payday and we have no money until then. Right now I’m the sole breadwinner between my wife and me. The student teaching she did for no money was rough and we had to get through that. I never really liked or understood why they cannot pay student teachers since they’re still doing a job. Now she’s done with that and graduated.

We’re half way through the month and I am a little concerned that nothing has happened yet. She puts in applications into places and then has to go get tests done, background check, and a lot of run around. Why wasn’t she informed about the process before now I have no idea? At the same time, no job and no income either.

I’m frustrated about how we’re going about spending money now. There’s only so much money for the month, and the normal household expenses usually stay consistent. Last month we spent way more than what came in, along with the car insurance bill. Now is the time to really assess what we’re spending money on. When we were in the grocery store the other day, I was adding in my head what we were getting. My wife doesn’t always think about the cost of things, so when I reminded her we only have so much in the account, she got upset. I’m doing my best here trying to keep things together, but at times I feel like she could be doing more.

There have been plenty of comments in the past that we’re never going to get anywhere unless we’re on the same page. I agree with that, which is why I’ve stopped trying to pay off debt for now. There is no point in my efforts unless my wife also believes in the cause. I just want to focus on the necessary expenses right now. When the bills come in I track their balances and payments due. It will take a long time to clear the balances when we only pay the minimum required monthly payment. This is where those DMP and credit counseling programs catch her attention. I don’t like resorting to something like that, but the idea of those is you pay one monthly payment and they distribute it between the creditors involved. There’s a specific chart and a roadmap of how long it will take to be debt free. It would be great to get rid of credit cards, but I don’t think we need a program to do this.

I also brought up the sour subject of student loan debt. These loans can’t go anywhere quickly when we are still working on our credit card debt. Getting rid of credit card debt is more important than paying off student loans. It just takes time and sacrifice to dedicate the income towards the cause. I only have so much control over money, and that’s not saying much.

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We’re finally in the first full week of the first month of the year. I was worried about my paycheck being less than what it normally was due to increased cost of insurance, but it wasn’t too bad. Even with that said, it still wasn’t much money to work with coming out of December. At the same time my wife has no money coming in yet which is now a problem.

My wife graduated with her masters, so she is officially a teacher now. I am patiently waiting for her to make the effort to get a temporary substitute job while she is working on a more germinate position. She is fully qualified and will make a great teacher, but the school isn’t going to hand her a job. Money has been tight since she stopped working and did student teaching. We need to get back to DINK (Dual Income No Kids) stage so enough money is coming in so I don’t feel all the pressure.

The reason I’m frustrated during this period of single income, our spending has increased not decreased. Sometimes I would pull from the EF just to hold us over to rebuild it back to its original amount. Since the EF was blown apart in December, we don’t have any cash to spare right now. This is why I get very frustrated when stupid things come up like Coldstone (ice cream) and Starbucks. We can’t afford these things right now and really need discipline when it comes to spending. No more using the credit cards to hold things over.

I’ve tried to have a serious talk about money before, but it usually turns into something else. The last thing I need is a fight because that doesn’t accomplish or change the present situation at all. Something tells me I’m going to have to find an additional job to bring in extra income. I hope she gets some temporary sub spots soon because we can really use the money to help ease the pressure I have been under. We have awhile to go yet before I get paid again and 2/3 of that goes directly to our regular monthly bills. Lifestyle is going to get seriously cut here until the income situation improves.

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Thanksgiving is that time of year we’re supposed to be give thanks for the things we take for granted. This is not the case with major retailers given that they make 25-50% of their annual profits in the 40 days between holidays. Not that I wanted to go, my wife and I got caught up in the Black Friday mess.

I noticed a lot of stuff, even on sale, wasn’t that great of a deal considering I have seen the same prices weeks before. So what makes it about Black Friday that gives people permission to spend money? My wife actually didn’t spend that much money and meanwhile I got my mom the doorbuster Mickey Mouse snow globe at JCPenny. So we’re still in the black for now.

December is going to be another story. Just as the issue came up in June, our semi-annual car insurance bill is coming due. An added bonus though my wife’s insurance will be discounted more so we will save over $100 bucks this time around. It will still take some money though to cover our insurance bill so we’re covered the New Year. I’m not sure how we’re going to do both Christmas and car insurance in the same month. My wife starts to look at that emergency fund as though it is regular savings for this time of year. It almost sounds like she thinks we should go into the New Year with no EF.

At the same time along with Christmas is my wife’s birthday. She already told me she wants a Coach purse for Christmas and the matching wallet for her birthday. I’m at a loss here when it comes to figuring out how to cash flow a $300-400 gift. Getting out of debt isn’t a priority to her this year and I don’t know if it will be next year. Sometimes I just want to stop trying anymore because I’m not getting anywhere. Is all the effort on my part really worth it?

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We’re almost through this month of August and I think the money is going to get tight. Pretty much what my wife made for the summer has also been used as regular income. She is going into student teaching now and they (her teachers, advisors, etc) suggest that she not try to work while doing this. It is going to be almost like an unpaid internship where the gain is learning experience. I’m a little bit frustrated because we were having problems before, but now we’re going to have some serious problems if the spending isn’t controlled next month.

Priorities need to really be taken into consideration next month and the months that follow. I have that 1k sitting in an EF for emergencies, not for other things. There are two tires on my car I’m not sure how long they will last but will need to be replaced here soon. I am trying to plan $100 a tire for this month and next month so there will be some money there to fix that situation. What is going to be difficult next month until November or December is not running to the EF to fix a problem.

The other solution is for me to work more to make up for what my wife used to bring in. I can get a second job in my sleep, but the reason for a second job must be justified first. In the meantime I am going to resort to a pastime of doing website design/maintenance services that I did in high school and college. These jobs are small and random as I find them on Craigslist and knock them out quickly because I know what I’m doing.

I don’t think there’s going to be much in the terms of debt repayment for the next few months other than just holding the ship steady. The only positive thing right now is my wife is in her final stage for her masters degree. After that it means no more borrowing money for school through student loans. We could finally put an end to both of us using credit cards for any reason. I hope she lands a job quickly when she is done so that the household income bumps way up over what it has always been. My income has gone up over the two year period I have worked and expect it to increase even more. This time next year we should be on a better path to really focus on getting rid of debt.

My plastic pinch update will be coming shortly.

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