Family of 6 Needs Budget Advice

**Inkstain82** · 05-19-2009, 03:14 PM

You can't really afford that house, the mortgage is way more than 1/3rd of your budget. But since that's non-negotiable.

Drop the bottled water, drop the second car, drop the cable, drop the gym membership, drop the cell phones. That should get you pretty close.

Sorry, I know it's tough because you are probably accustomed to those things in your lifestyle, but you simply cannot afford them.

**nanamom** · 05-19-2009, 04:50 PM

i would drop the second car, the cable, (you can watch TV on the internet and most of TV isn't worth it anyway) Do you need pet insurance, or the prepaid legal? If you lose the 2nd car your insurance should go down and the gasoline and maintenance as well. Lose the gym and pack the kids lunches. Bottled water is not a needed item either. That comes to over 600 saved. Of course that is assuming you can sell one of the cars for whatever is owed on it. I know it sounds like a second job is th eanswer but as a SAHM I believe other options should be explored first. Can your wife work at home? What did she do? Can she do after school care? tutoring or anything like that.

**kork13** · 05-19-2009, 05:23 PM

I grew up with the public water seriously not suitable for drinking (just washing/cooking basically), so I can understand if that really is the case for you. However, a good water filter can generally solve most of the problems that would merit the need for bottled water, and over the long term would be much less expensive as well. However, if the public water is fine, .......

Other notes....

How large are your tax returns every year? With 4 kids and a home, I expect that it may well be in the thousands. If so, adjusting your tax withholding could free up an extra couple hundred dollars a month for you right there.

You should shop around for some of your services... Pest control? Look for a service/treatment that is effective for 6 months (or longer). At least around here, pest services like that only cost $75-$100 per 6 months. If nothing else, compare companies... get price quotes, and they'll often offer incentives if you change over to their company. Same goes with the alarm service and car insurance (pet insurance? never heard of it.....is it necessary?).

On a similar token, start food shopping by unit price -- cost per ounce/unit. It seems like a minor thing, but by being aware of the unit prices of the foods I normally buy, I tend to save almost 15% off my food costs, because I can more accurately compare products and get the one that is truly cheaper (even comparing between 2 or 3 stores). If you could get even moderate savings that way, it's still chipping away at your deficit.

I think that's what you need to focus in on... chipping away little by little on your expenses... $5 here, $10 there, it adds up, and your deficit narrows. Hopefully, you can quickly get back in the black. Selling the second car saves the payment, gas, maintenance, and insurance costs. Honestly, that and the cut cable/gym/cell phones ideas seem the most helpful for you... Best of luck.

**disneysteve** · 05-19-2009, 07:31 PM

Honestly, I don't know what universe folks are living in when they suggest selling one car. Father works 12 hour days. Mother is home with kids and takes older kids to after school activities. How exactly is she supposed to do that without a car? How does she go to the supermarket? She is job hunting? How does she get to an interview? Whether my wife worked or not, I would sell our house before I considered leaving her without a car. Sorry, but I just don't comprehend the reality of that advice.

Anyway....

You have ton of stuff that can be cut. Keep in mind that just because something has a termination fee doesn't mean you can't eliminate it. Paying the fee may save you far more money in the long run.

Unless your job requires it, cell phones are luxuries. Get rid of them. At the very least, your 10-year-old doesn't need one. If you really want her to have one, go with a prepaid one so you don't have a monthly fee.

Cancel cable or cut to the most basic service. We pay $10.76/month with Comcast.

Cancel pet insurance.

Cancel prepaid legal, whatever the heck that is.

Cancel the gym. You can exercise just fine without it.

Cancel pest control. Go to Home Depot. Buy a 2-gallon sprayer (about $30) and a few gallons of home bug spray (about $7/gal) and do it yourself.

Consider canceling the alarm monitoring. This is an iffy one. What deters criminals is the sign out front showing you have an alarm and the loud siren that sounds when the system is tripped. The monitoring really doesn't do much. By the time the police show up, the crooks are long gone. The crooks don't know if your system is monitored or not.

Cancel bottled water. If you want water, turn on the faucet.

Let's see. That comes to a savings of over $325/mo. and that isn't counting a lower cell phone bill. Sounds like a good start to me.

**Inkstain82** · 05-19-2009, 08:36 PM

Does the father need the car while at his 12-hour shift? If not, dropping him off before and after should work.

It's not easy, but it's doable. We've got one car for two professional reporters in our house, and that's a ton of driving.

Well, I can't say for sure it's doable because I haven't tried it with that many kids, but that's the reason many of us see a second car as a bit of a luxury. When your rent+HOA is just past 40% of your takehome pay, that's going to really cut into the budget in other places.

**snafu** · 05-19-2009, 10:35 PM

Sadly, your posting leads me to conclude your lifestyle exceeded your income from the start. If keeping the house is truly your #1 priority you would cut out all the discretionary extras. Kids can take lunch, house alarm, pet insurance, legal benefit, pest control can all go along with the list by Inkstain. It was not clear if was wife seeking any employment or employment similar to the job she lost?

This economy is often compared to the Great Depression of the 1930's. If you check-out grandparents generation, they did whatever was necessary to keep the family feed. Children not only shared a room but in many cases shared a bed. Amy Dacyczyn became famous a few years ago publishing her 'Tightwad Gazette' [available @ library]. Meals from scratch can chop food bills. Making bread is very satisfying, cost 10% of bought bread and far healthier without additives and preservatives.

A lot of how your children react to your new circumstances will depend on your presentation. If you treat this as a learning experience and adventure, the children may do better as adults, never letting finances run off the rails. They will understand the need to have an emergency fund and savings because life happens.

**fruitbowlk** · 05-20-2009, 04:10 AM

Kids Lunch - $90-pack instead of buy.

Bottled Wate Delivery - $50-needs to be cancelled.

Internet - $25-supended for a few months.

Home Phone - $25-cancel.

Visa - $15-Loan - $165.67-Loan2 - $114

These can be paid off today.

**disneysteve** · 05-20-2009, 05:19 AM

Originally posted by fruitbowlk View Post

Kids Lunch - $90-pack instead of buy.

That number jumped out at me when I first read the list. Then I calculated it out. With 3 school-aged children, that is 15 lunches/week so 60+ lunches/month. $90 is $1.50 or a little less per lunch which really isn't bad at all. I don't know how much less you could spend and still provide a nutritious and filling meal.

**disneysteve** · 05-20-2009, 05:24 AM

Originally posted by Inkstain82 View Post

Does the father need the car while at his 12-hour shift? If not, dropping him off before and after should work.

It's not easy, but it's doable. We've got one car for two professional reporters in our house, and that's a ton of driving.

Well, I can't say for sure it's doable because I haven't tried it with that many kids, but that's the reason many of us see a second car as a bit of a luxury. When your rent+HOA is just past 40% of your takehome pay, that's going to really cut into the budget in other places.

Obviously, it depends on a lot of factors. How long is dad's commute? Do you have someone to watch the kids while mom drives him to and from work?

Do they live in the city or suburbs? I grew up in the city. We could walk to school, walk to the supermarket, the bank, the post office, the library, etc. Where I live now, you can't realistically walk much of anywhere. My daughter's school is a 15-20 minute drive and is not along a route I would allow her to walk for safety reasons, aside from the fact that it would take her probably well over an hour.

I'm spoiled. I admit that freely. I do not consider 2 cars to be a luxury in our lives. What we choose to drive might be, but having 2 cars is not.

**Inkstain82** · 05-20-2009, 07:41 AM

Originally posted by disneysteve View Post

I'm spoiled. I admit that freely. I do not consider 2 cars to be a luxury in our lives. What we choose to drive might be, but having 2 cars is not.

Unfortunately, that leaves him painted into an awful corner.

Two cars + mortgage + car insurance + HOA = 60.4% of his monthly income.

Even if everything else is cut to the bare bones (which is really hard with kids, who wants to tell them that they have to eat PB/J and drink tap water for every meal because their bedrooms and rides to school are a luxury), you are going to have problems with housing and cars eating up that much.

I guess the only solution here is to find more income, somehow.

**disneysteve** · 05-20-2009, 08:39 AM

Originally posted by Inkstain82 View Post

Unfortunately, that leaves him painted into an awful corner.

Two cars + mortgage + car insurance + HOA = 60.4% of his monthly income.

I'd like to know how much is owed on each car and what each one is worth. Might it be possible to sell them and replace them with cheaper ones for cash and get rid of the payments? That might also reduce insurance costs. Raising the deductible can help, too.

**Lindahfx** · 05-20-2009, 11:21 AM

All good suggestions. Could your wife take in kids to bring in extra income?

**snafu** · 05-20-2009, 11:39 AM

Watching Jamie Oliver's effort to bring easy to prepare, healthy, child friendly lunches to the British elementary school system, reminded me that most school lunch program foods are full of sodium and preservatives...cheap, filling but not healthy from a nutritionist POV.

**DebbieL** · 05-20-2009, 12:00 PM

Originally posted by Inkstain82 View Post

Does the father need the car while at his 12-hour shift? If not, dropping him off before and after should work.

It's not easy, but it's doable. We've got one car for two professional reporters in our house, and that's a ton of driving.

Well, I can't say for sure it's doable because I haven't tried it with that many kids, but that's the reason many of us see a second car as a bit of a luxury. When your rent+HOA is just past 40% of your takehome pay, that's going to really cut into the budget in other places.

I agree it is often doable. DH and I only have 1 car, and it works just fine for us. We both work full time, and I also go to night school - and we make it work. I don't miss having my own car at all most of the time (I sold it over a year ago). If you live where there is a good transit system to where you need to go it is very easy. I can easily catch the bus near where we live to work downtown, then after work to college (and back home after college). My tuition also covers a bus pass, so I have no additional costs for using the bus either.

Family of 6 Needs Budget Advice