General Question

livelaughlove21's avatar

What to do when income equals outgoing?

Asked by livelaughlove21 (14620 points ) March 8th, 2013

My husband’s job recently got new management that dropped everyone’s hours from 60 per week to 40, with no plans on giving anyone overtime. He went from bringing home $800+/week to $500, and our bank account is already suffering.

We’ve done all we can to lower our current bills, neither of us has enough time to work a second job, and I discovered today that the amount we both bring in is the exact amount of our bills. This doesn’t take into account a higher-than-average electric bill or anything like that, but it also doesn’t take into account the money I make as an on-call bank teller, because the money is unreliable. So, any money I make there is “extra.”

We’ve got a tiny bit saved, but nothing worth bragging about. Our money is slowly dwindling and I’m freaking out. We’re getting a few thousand dollars back for our income tax refund, but we’ve been waiting over 21 days since our return was accepted and still have not received our money. I’m worried that fiscal cliff delays will push back our refund for months.

I graduate in December and will be working full time, but the next 9 or so months look awfully daunting. We haven’t gotten to the point where we’re late on bills and we do have quite a bit of money available on credit cards that do not charge interest for 14 months. We only plan to use the card(s) until we get our tax money, and then pay it off, but using credit when I don’t have the money makes me nervous.

I know people use credit frivolously all the time. I know a lot of people are late on bills because they can’t afford them. I know people lose their jobs and are way worse off than we are. I know people live paycheck-to-paycheck their entire lives. However, I’m 23 and we’ve never had to worry about money until now, so it’s a foreign feeling to me. We bought a house late last year, and so things are a bit scarier when you know you can’t just move out if you can’t afford the rent.

I don’t need advice on how to cut expenses – I’ve done so much searching on that recently that there’s nothing anyone could say that I’m not already doing or have tried doing. What I’m wondering is if any of you have been here before, and how you dealt with the anxiety. How can I make myself feel better about this and just be thankful we make enough to pay for what we’ve got, even if there’s no wiggle room in the budget?

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50 Answers

captainsmooth's avatar

Keep your eye on the goal of graduating and what will come after. Try not to get to stressed over the shell game that is your finances. Talk to your mortgage holder about reducing the payment until you graduate.

Things will get better in 9 months. It is just money and a very short period of time.

Adirondackwannabe's avatar

@livelaughlove21 Don’t fret about it. Whatever is going to happen is going to happen. You have so much money and so many bills. Try not to use the credit cards. I made that mistake once.

Coloma's avatar

Aaaah…the ways of this economy. :-(
Well…I am in the same situation and am making a major life change myself after suffering the carnage of this last few years of little work and expenses exceeding my income.
This is happening to a lot of people right now and I am more than twice your age.
Do you have room for a room mate?

Not ideal as young newlyweds, but if you could find a decent room mate you could charge them, on average, around $450—$550 a month.
Yes, as @Adirondackwannabe try not to freak out, this is life, things are ever changing.
We are all called upon to adapt and re-adapt,over & over & over again.
Best wishes!

Judi's avatar

At times like that my spiritual life got me through.
That universal Serenity Prayer comes to mind.
“God, grant me the serenity to accept the things I cannot change, the courage to change the things I can and the wisdom to know the difference. ”

Coloma's avatar

@Judi Yes! Surrender Dorothy! ;-)

filmfann's avatar

We have been spending more than we make for about 3 years. We borrow, use credit cards, and defer payments. It doesn’t help that my company wants to not pay us retro pay for the first half of last year, and the new contract is going to take away more than it gives. The anxiety is tough, but we know we made good decisions that will flush out in the end.
And I eat a lot more macaroni and cheese, and peanut butter sandwiches than I used to.

whitenoise's avatar

Look for opportunities in another job. Another state Another country.

Else… 9 months should be OK. Don’t overly stress yourselves with worries you cannot address a solution to.

Use your voting rights wisely.

KNOWITALL's avatar

At one point we sold several frivolous items, like our old Wii and games, a few guns, etc…to boost our savings. Maybe have a garage sale?

Shippy's avatar

I’ve always believed in living well below my means even when things were great. Which stood me in good stead when harder times hit. As everyone else said. He can look for better opportunities. Or cut the cloth. Smaller car, smaller home, cheaper food stuffs, less clothes buying that sort of thing. I did a rough Rand and Dollar conversion and that money would be OK here. For a fair and well fed life.Or of course you can do part time studies as many do and work, not sure if you are working already though.

nofurbelowsbatgirl's avatar

I am sorry for your situation. I am young and after my husband passed away and I lost his income which pretty much he was the sole supporter, so my life got pretty tight. We (my daughter and I) were living paycheck to paycheck. To top it off I have been struggling with mental illness for most of my life. I finally took what I had from selling the home I could not afford and decided to buy a smaller home that was more affordable and move my mother in with me, since I know she could use the help and I could use the help and it is working out great. Hopefully it works out on the easier side of things for you and not so much of the burdening side.

Judi's avatar

@nofurbelowsbatgirl, if you have a daughter didn’t you get social security survivors benefits after your husband died? I was surprised that I even got the benefits for my daughter who had a different father because he had been supporting her.

blueiiznh's avatar

So sorry to hear the about the rough spot. Keep your head up and continue to be resourceful in your bare bones financial measures.
The last thing you want to do is dip into savings, retirement or start to bleed.
If he was cut 20 hours per week, can those hours be applied somewhere else?
Math would state that he would have to be making about ~$20/hour to make that money up (taxes may vary).
Identify what are mandatory spends and remove the discretionary spending. Review every essential need on those that you even categorized mandatory and slash to the bone.

marinelife's avatar

You need to change you outgo. Look at big expenses like house payment or rent and downsize. It will be painful, but you need to.

KNOWITALL's avatar

Like @marinelife says, to lower the house payment, see if you can re-finance the home mortage. You can get money out for savings (which I don’t recommend), or lower the payment hopefully!

Seek's avatar

Hi! * waves *

I’m trying to maintain a house on 12 dollars an hour! And we reached the end of our savings and our valuable collectibles about four years ago.

Being poor sucks. A lot. But we’re surviving. Barely. Somehow. I do have about $2000 in expenses in the next two weeks, and about half that available. Fun! The current question: Do I pay the rent and not get evicted, or the car insurance and not have my drivers’ license suspended?

FutureMemory's avatar

You need to get a job, I think.

I know you said you’re in school, but when your husband losing his overtime results in a crisis, something isn’t right. You guys have bitten off more than you can chew.

KNOWITALL's avatar

@Seek_Kolinahr Dang, that sucks. How about sell the car, keep the insurance payment and keep the house?

Coloma's avatar

@KNOWITALL But then she cannot get to work I think. Yes, really sucks. sigh :-(

flutherother's avatar

December isn’t very far away but I would discuss the situation with major creditors such as your mortgage company. They might be willing to accept reduced payments for a while given the circumstances. You will find that simply having talked about it you will feel better.

KNOWITALL's avatar

@Coloma Bus line? I thought that was a benefit of city life- lol, even a scooter or two would be cheaper than a car right?!

Judi's avatar

@nofurbelowsbatgirl, did you apply? You still could if she’s under 18. (Unless you’re not in the US. )

livelaughlove21's avatar

Thanks for all the responses everyone!

@captainsmooth, @Adirondackwannabe, @nofurbelowsbatgirl, @filmfann, @Seek_Kolinahr Thanks for the kind words. Sometimes all I need is someone on the outside to say, “It’ll be okay,” or that they’ve been there, and it helps a lot. My anxiety gets the best of me at times – most of the time, actually.

@Coloma Thanks. The roommate thing is something we’ve considered, but only as a last resort. I think it’ll be hard to find a single roommate in our town willing to live with a married couple with a cat and a puppy. We’re 30 minutes from the university. If we were closer, it might be easier, but it’s slim pickings around here.

@Judi Thank you. :)

@whitenoise and @Shippy I don’t think we’re in so deep we need to flee the country quite yet, but thanks for the suggestion.

@blueiiznh We live in South Carolina. He makes $18.88/hr with a high school diploma. Unfortunately, it doesn’t get much better than that around here unless you have a degree or a trade. Finding a 20 hour/week job at $20/hr would be nearly impossible.

@KNOWITALL I’d love to, but we just moved into our first house and don’t really have anything to spare. No game systems, nothing. The most expensive thing we have that we can part with is a DVD player. Any chance of getting about $5000 out of that? A girl can dream! :)

@FutureMemory I have a job, as mentioned in the question. Anything I make there is “extra” (if such a thing exists). However, I’m an on-call bank teller, so I work when I’m available and needed, up to 18–20 hours per week at $11/hr. I’m in 6 courses this semester and, if I have a midterm or a project coming up, I can’t sacrifice my grades for the $50 I’d make that day. And my husband agrees with me. Getting my degree is #1 right now.

@flutherother and the others that mentioned lowering the mortgage – I can try, but it’s through a bank and the loan is very new. I’ll cut other bills before I try to lower the mortgage. At 3.75%, I can’t really complain about paying $790/month for a $140,000 house. Moving is simply NOT something we’ll be doing. We just got this house and we’ve hit a temporary road block; it’s not so severe that we need to declare bankruptcy or foreclose on the house. And considering we have 5 houses surrounding us that have been on the market for months and haven’t sold, selling isn’t our best bet. We’re staying put.

And if I didn’t mention you above – thanks to you too!

My husband’s job is something we cannot afford to change. It’s a better job than most around here, with better pay, and he plans to stay there until he retires, eventually getting a degree, moving up the ranks, etc. He’s found his niche and we’re very lucky he has a well-paying job. Like I said, he makes $18.88/hr, but they kill him in taxes, which is why he only brings home $500—$550/week. He’s claiming 1 on his taxes and we’re scared to raise it, as we don’t want to owe money at the end of the year.

If it gets to the point where it’s necessary, he’ll get a second job. Way before we’ll do the roommate thing again. I’m just hoping we’ll get our tax money back soon, we can keep living as though we don’t have extra money, and maybe it’ll last until I graduate and no other sacrifices will be necessary.

Again, thank you all for your input!

Bellatrix's avatar

As @flutherother suggests making sure your creditors are kept informed is an important thing to do. If you can’t pay the whole bill, pay something and keep talking to them. They will be much more likely to be forgiving.

Part-time study makes sense. Trying to study full-time when you are stressed out isn’t conducive with great results anyway. So, if you can find some part-time work do it (or in your case boost your part-time work up a notch). Speak to the careers people at your university. There might be work in the library or other university organisations. At least you can avoid adding more travelling time and costs to your time-money pressures.

livelaughlove21's avatar

@Bellatrix It’s really a “damned if you do, damned if you don’t” situation. Well, first, I can’t cut down to part-time in the middle of a semester. I could after that, for the Fall, and work more to make more money right then, but then I’ll graduate 6–12 months later, meaning I can’t work full time and actually make decent money until then. As for the suggestion of me getting a job, see my response to @FutureMemory above. :)

Bellatrix's avatar

It just might take the stress off. I see a lot of students who are desperately trying to juggle life issues AND finish their degree as quickly as possible. It generally isn’t a positive outcome. If you are stressed out, you could get sick and be forced to take longer. So planning to take a bit longer might be a better option. Speak to your university counsellors too. It sounds like you already have a huge workload. Anyway, whatever works for you.

chyna's avatar

You do have your taxes to look forward to, so there is a bit of a silver lining there. If you can just stretch that money for the next few months until you graduate, you will be fine!
I know you said you don’t want to change your withholdings on your taxes for fear of owing at the end of the year, but since you are getting a few thousand back, I think that money could be more beneficial in your pocket during the year than in a windfall once a year. You can figure what you need to claim so that you just about break even at the end of the year instead of owing or getting a huge chunk back. If you are getting 3,000 back, that much spread over 12 months is 250.00 per month. I’m sure you can use that now.
Either way, your positive attitude will see you through.

livelaughlove21's avatar

@Bellatrix You’re probably right that it’s a better option. Fortunately, I’ve been able to maintain a 4.0 up until now, so a couple of B’s or even a C wouldn’t be detrimental to me getting my degree. Getting sick is definitely a valid point – as it’s already happened semi-recently and caused me to miss quite a bit of school and work. If I wasn’t so eager to get the hell out of school, I might take steps toward slowing down a bit. But thank you for the suggestion.

livelaughlove21's avatar

@chyna Thank you. I may see if he’ll move it up to 2 and see what kind of effect that has on his checks. Before this week, it was at 0 for some reason. If he can get up to $600/week, that’s an extra $400/month. That would be tremendously helpful.

Response moderated (Spam)
nofurbelowsbatgirl's avatar

@Judi not in the US. And she turns 18 in a few weeks.

Seek's avatar

@KNOWITALL I have an hour commute, and my job requires me to run errands. There is no reliable bus line. The car I have is paid off, but I just had to replace the radiator, which fucked me out of the insurance payment.

bkcunningham's avatar

You said your husband’s hours were cut from 60 to 40 a week. I don’t understand why he wouldn’t have time for a second job.

livelaughlove21's avatar

@bkcunningham He was working from 5AM until 5:30PM, and now he’s working 9AM until 5:30PM. If he got a second job, it would have to begin at 6 or 6:30PM. Not many shifts start this late unless it’s an overnight job, which he can’t do if he plans on sleeping at all. In fact, finding a job that will hire someone with such a limited schedule instead of one of the hundreds of other applicants that are available all the time? Not likely.

Plus, if they ever do offer overtime at his job again, he couldn’t stay. $26/hr (time and a half) vs. $8/hr – not a difficult choice.

bkcunningham's avatar

You either have to cut your expenses or come up with more income. That is the only formula that works. I know it is tough, but most of us have been there and have the t-shirt. You’ll get through this and it will be okay. Just remember this though. Worries about money can put a big strain on any marriage and can be extremely tough on a young, new marriage.

Talk openly to each other and love each other through this. Find time to spend together making fun FREE memories. You guys aren’t the first couple to have money problems and you won’t be the last. Learn lessons from this time in your life. It’s going to be okay. Please, don’t get a bunch of debt on credit cards though. That’s just a puppy chasing its tail and you’ll never get ahead.

JLeslie's avatar

I have been there, actually worse. My income dropped below my expenses at one point. Worrying about having enough money to live is incredibly stressful. One of the worst stresses. Since your income is extra, it sounds to me that it really is not a very bad situation considering it is only for several months. My advice is do not use your credit cards to float money. Avoid that at all costs, only for dire emergencies like God forbid a health expense. I happen to be in the camp of using your credit cards to float money until the end of the month, but then you must pay in full the bill to avoid any charges of interests or other fees. Do not buy anything you can’t afford in full.

I’m sure I don’t have to say this, but this is a lesson in saving for the future. Next time your income increases you can sock more away for a rainy day so you can avoid this stress if anything like this happens again. I am not lecturing, it seems to me if your money is extra already you guys tend to be conservative with your money. Plus, you are just in your 20’s so this sort of set back is more difficult to absorb, since you have only had a few years to really be earning any income or saving.

Shippy's avatar

@livelaughlove21 I meant conversion of like for like. Meaning that would be an OK living to make. I certainly wouldn’t suggest anyone move to South Africa.

RealEyesRealizeRealLies's avatar

I changed from State Farm to AAA, and my insurance rate fell to half of what it was.
Changed cell phone from ATT to Straight Talk, again, half the rate.
Killed the lan line and cable. Love NETFLIX and Youtube… and books.
Dog gets more dry food now than canned. Less treats, but more scraps.
Keep car tires inflated and stay off that gas pedal. Hitch a ride when possible. Carpool.
Cooking more meals with leftovers in mind, so less energy and waste.
Walking to grocery store every other day instead of big shopping once a week.

blueiiznh's avatar

I gave you the math answer earlier. Here is the emotional answer.

Keep hope. Keep up the fight to find a way through. Know and trust that you will come out of this alright if you stay diligent.

Short story…..Three years ago I became unemployed. Single Dad, 24×7x365 with 9 yr old daughter. No family that was in near proximity. The timing of the economy and job situation in my industry was also not on my side. Top costs were mortgage payments, private school tuition, etc. Unemployment Insurance in my state with my salary capped me to get 35% of my normal take-home. I slashed everywhere I could. I kept hope.
I went into survival mode. In the face of the mortgage and foreclosure crunch, I stayed diligent on trying to talk to my Mortgage Company. I was already committed to the tuition. Thank god it was not during heating season ($400 per month). Jobs were also not easy and I knew I could not expect to jump back to my salary immediately. I contracted, consulted and took jobs doing anything. Nothing was beneath me. Cobra payments for medical were $900/month as the subsidy program just had ended. Luckily they were signed back in and it dropped to $450. After 4 months it was evident that the path I was on, it was only a matter of time before I would more than likely lose my house. I kept hope. I wanted to keep my daughter in private school. I applied for tuition assistance to keep her there and was blessed with a complete pass and $0 dollar tuition bill for the upcoming year. I then applied for the HAMP program to try to save my home because my Mortgage company was unwilling to work with me to adjust. My daughter being a soccer player hit the late summer tryouts and the season cost of $360 was then looming. I applied to the league and it was waved. I was diligent, humbled and still with hope.
I had many interviews along the way, interviewed for many jobs that had promise and many with promise that would vanish. I kept hope.
Friday August 30, 2010 I drove to an interview. It went well. The recruiter called me as I was only 10 minutes leaving the prospect and stated they wanted me to start on Monday and told me the offer. That they would email it to me to review. I got home and had an email and message from a different prospect and an offer letter from them. I worked three hours white boarding which one to accept. The following week I received approval via HAMP and got my mortgage redone to a fixed 2%, dropping $600/month. My first paycheck, payed my new mortgage payment. I love my job. Was promoted a year ago. In hindsight I am thankful for the new path. This is life as it throws at us. This is one of those road not taken moments.

So keep hope. Stay diligent. Accept being humbled to do whatever you need to do.

It is in these tough times that you will more than likely learn the most about yourself and your significant other. You are have the right attitude of taking responsibility for it and seeking a way through it. These are times to stay focused, no matter what. Learn to accept whatever path it takes you on and to. Stay positive. Accept the path. Be diligent. Keep hope.
Some things and change simply happen for a reason unknown to us. With hope, this will be one of those “what doesn’t kill you makes you stronger” times in your life. Becoming humbled allows you to clearly see what is important in your life.
You are in my prayers to find your way through.

Coloma's avatar

@blueiiznh What a wonderful and inspiring story! Rings similar to mine in the short version. 6 years ago I had a job I loved, a fat nest egg and life was easy, joyful and peaceful. I was rather smug about the economy in ‘08 & ‘09, thinking I was not really feeling it. Heh…talk about humble.

Yes, so true, that which doesn’t kill us does only make us stronger.
I am nervous about my looming transition but there are lots of positives.
I came to this country property when I only needed to work part time and several sources of passive income, which have now evaporated with the economic downturn.
I just keep telling myself that even if I could afford to hang on here, having to work full time again I would never have the energy for all the upkeep, watering chores and other physical and time demands of living on a 5 acre property as a single woman, 25 minutes from the nearest medium size town.

Yes, I am still sad but…I have in-joyed 7 years of a lifestyle that many only dream of and I will always cherish the memories. Hold on loosely.

bkcunningham's avatar

@blueiiznh, I want to commend you on a beautifully written, inspirational story.

nofurbelowsbatgirl's avatar

@blueiiznh you always inspire me :) You stay calm even in the eye of storms ;)

@livelaughlove21 I hope you are feeling better :)

bkcunningham's avatar

I just thought about something. Have you check with your state’s Employment Commission to see if your husband qualifies for partial unemployment since his hours were cut so significantly?

livelaughlove21's avatar

@bkcunningham No, I haven’t, but he’s working 40 hours a week. That’s full time, regardless of what he was working before. I doubt they’d give us anything, especially considering his hourly rate. He’s not exactly in the poor house.

Seek's avatar

All right… car’s in the shop again. Awesome.
And the hole gets deeper.

Coloma's avatar

Quick everyone! I have 16 days left to stage a mass burial on my property, start digging your graves now. I bet I can get my ranch vet to give us all a great deal on package euthanasia. My neighbor has a tractor. Bury me with with Marwyn and all the other pets down the hill under the big Oak tree, ‘kay?
Oh my sardonic wit…Pffft!

flutherother's avatar

That’s a bit drastic but why not sell off a couple of acres?

Coloma's avatar

@flutherother Haha…just kidding.
Zoning out here only allows 5— 10 acre parcels.
Can’t parcel out acre by acre. You either buy the whole farm or nothing at all.

Judi's avatar

@Coloma, so sad. Your place sounds great. If it had been a few months earlier I might have been able to buy it and lease it back to you. We just put our nest egg into an Oregon mountain property but coastal northern CA was in the running.

Coloma's avatar

@Judi Awww…thank you, yes, it has been a wonderful place. Congrats on your Oregon property, I wouldn’t mind going to Oregon myself someday. :-)

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