Wednesday, January 2, 2013

The year of the crack down

Brace yourself. This is about to get honest.  Not a woe is me kind of honest, just a real glimpse of where we are at. 

Almost a year ago Justin lost his job.  He was able to get a new job right away and never missed a day of pay.  The new job paid 1/3 less than his previous job.  It had potential for bonuses here and there.  With the economy the way it has been and other reasons, they haven't quite been what had been discussed when he took the job.  Overall this has taken some adjustments at home.  There have also been some unexpected medical expenses in 2012.  It was the year of the medical bill.  I don't think we have ever spent so much in one year on medical expenses. My job also changed this year.  It has been for the better, but it still had us adjust things financially. Our insurance just changed so we will be able to stop accumulating medical debt.  Justin finished is master's degree six months ago so it is time to start repaying loans. Tax rates just changed so our withholdings have changed.  Overall it is a good spot to revamp and make plans.

Debt plan: No more debt.  This plan was actually instituted a couple months ago.  I actually froze our credit cards in ice.  We can't use them.  I don't want to close them out yet because of our credit score.  I do want to pay them off.  I got an app that actually helps keep our debt pay off plan front and center and easy to track.  It shows me different debt pay off options when I enter all of our credit card, car payment and medical debt and when they will be done and which costs the least in interest or which speeds things up.  I paid all of January's bills today.  We have 31 months left! In order to make this plan work we have to stick with it and keep household expenses low to put our money towards the debt.  Our biggest struggle is changing our lifestyle.  I don't think we have an extravagant lifestyle, but we definitely are impulsive and there is no room for that right now.

Student loans: They are a huge looming burden.  Undergrad loans went into forbearance when Justin lost his job and have stayed there.  I just set up a repayment plan for the grad school loans. Adding the extra bill to the already tight budget is a little intimidating.  Ok, more than a little.  A lot.  But in reality, just putting them off forever was not a reasonable option.  It was just us avoiding it.  As soon as I agreed to it, I wanted to take it back, but I was really just nervous.  I know in the end, this is the best plan. 

Private school:  Ava is only in 1st grade.  As much as I hate the idea of her changing schools, now would be the time.  None of us want her to change schools.  I can't think about 2 of them in private school.  I will deal with that when it comes.  We have 2nd grade figured out.  I just can't think about 3rd grade, or 4th.  I have no idea what life will be like by then.  It does seem crazy when I look at everything I mentioned before to even be considering paying for private school for the next 11 years (Rhys included).  It isn't really a logical decision.  Ava doesn't want to change schools at all.  It isn't even about the friends.  She said that she wouldn't have chapel at the public school and she was right.  And then we started thinking of the education level and were reminded of why we chose to start her in private school in the first place.  Justin says we will sacrifice to keep her there.  I knew we would and reality have been.  I guess now it is really put up or shut up time.

Cutting back: The only real wiggle room we have is in the household grocery budget.  We need to get cheap.  Really cheap.  I think it means real meal planning again for me.  I need to consider saving money my job. I also need to figure out a good balance of cheap and healthy meals and make more things from scratch.  I have been earning little bits of money here and there and they have been adding up.  I get free shipping through shop runner.  I shop sales at for things like shampoo and stuff like that and I get cash back through ebates for it.  I actually have a check for $52 coming to me in February. We have also said our only resolution is no fast food.  No eating out unless it is pre-planned and a special occasion for a year.  Convenience eating is really our lifestyle indulgence and it has to stop. 

Earning extra: We are just going to earn little bits of extra when we can.  I am babysitting once a week this spring.  I am selling Thirty-One.  Justin is refocusing on his t-shirts. 

Are we alone in the financial crack down?  I know we aren't. What does yours look like?