I’m now simply at indebtedmom.com (and having some issues moving followers and such). Hope you’ll join me there for my new posts 🙂
We can’t afford our house.
Perhaps on paper we can, but even then, just barely. We bought this house just nine short months ago, with less than a 20% downpayment and it should have been obvious to us then, with a new baby on the way, that we were biting off more than we could comfortably chew.
But correcting the mistake of buying a house is not an easy one. If we were to walk away now, we would likely have to bring money to the table at closing. But not walking away means a giant chunk of our budget is non-negotiable and we are barely making ends meet, much less paying off debt.
Which is an interesting position to place yourself in when what you really want to do is stay home. This house is standing in the way of our life.
Our Own Stupidity
We made a lot of missteps buying a house when we moved here about two years ago:
- First, we shouldn’t have bought a house here until we were sure we wanted to stay for at least three more years. I won’t go into the reasons here, but we have industry-related issues that could force a move as early as next year.
- We ended up buying a house 30 minutes from work, church, pediatrician, and gymnastics class (the class is funded by grandparents, so don’t roll your eyes at me). We couldn’t afford any houses closer – a giant red flag about the general cost of living here. So instead we traded a too-expensive mortgage for a manageable mortgage, plus extra gas and vehicle maintenance. I’m thinking we didn’t come out ahead.
- We were keeping up with the Joneses. We moved everything from our stuffed 2700 sq ft house in Texas and put it in a 1700 sq ft town home when we got here. We were tripping over each other, furniture, and dogs. We did not sell anything. Nope. Not one thing. We needed it all for a future house.
What Would Dave Do?
After our recent budgeting exercise had us so tight on vehicle maintenance, medical care, and groceries, I got nervous. I found a forum of Dave Ramsey believers and submitted my budget for review. You know what they said? They told me we needed to make more money.
Seems kinda crazy telling people whose combined income is well over six figures, but these folks couldn’t find too many areas to shave, considering we write four-figure student loan payments each month.
Due to the nature of our professions, we don’t have other viable employers in this area. If we want to make more money, that means we have to move or take on second jobs. We work 40 hours a week minimum, so with a long commute and small children, second jobs are hard to fit in.
Two Steps Forward and One Step Back
Let’s say a new job opportunity presented itself to my husband. And let’s say it didn’t pay relocation, but the salary offered was good enough to entice us to move. We’d lose money on the sale of the house. We’d lose money moving. But isn’t it still the right call?
I think the answer is yes.
We are not ready to sell the house today, but I thought undoing our mistake might still be the best call. And then we could be prepared to quickly move if we needed to or wanted to. And what if we sold our house now for a fair price? We’d end up renting where we started out, which was across the street from our daycare and 5 minutes from work. Time is money. And location is money, especially with rising gas prices.
With that plan in mind, my husband and I decided to list our house on Zillow.com as a “Make Me Move”. “Make me move” is a premarket listing on Zillow, which some owners use it to see if their listing price is fair and some are using it to post a house that might need a few things before being placed on the actual market. The process is simple – it only took me about 15 minutes to do a thorough listing.
With the house (sort of) listed, we have a few things to start tackling. We want to be prepared for moving back into a 1700 sq ft place with an extra body (after all, we’ve had a baby since leaving the townhomes).
- We need to downsize. We have two couches, for example. And two washers and dryers. Craigslist, get ready!!!
- We need to minimize. We have too. Much. Stuff. My daughter has a playroom filled to the brim with toys. I have clothes in three closets (to be fair, one closet is maternity clothes, which I am still in, and the others contain various sizes I hope to one day be. Again.) I think I have something like 6 cake pans, which is a lot for someone who rarely makes a cake. Yard sale and consignment shops, here we come!
Anything we net from Craiglist and the yard sale will be set aside to help us bridge the gap at closing. If we get lucky and don’t have to bring money to closing, we’ll roll this money back into our debt.
What about you – have you ever had to lose money to put yourself in a better financial position?
The mind of man plans his way, But the LORD directs his steps. (Proverbs 16:9 NASB)
I’m in the process of moving my blog over to WordPress.org, where I’ll become simply indebtedmom.com. While that’s happening (and while I care for a sick baby), I decided to throw up a quickie post.
I’ve been mulling over what I want for our financial future. I don’t want to be rich, so let’s start there, but I decided I have some goals other than just getting out of debt and staying home with my girls. And since this blog is all about accountability, I wanted to share these goals and possibly check in on them time to time.
- DEBT: pay off three debts a year and be debt free in four years
- RETIREMENT: retire by 50. Tall order given that we will only have about 10 years after becoming debt free to save and we haven’t been doing a great job
- TOYS: buy Brian a plane before we retire
- TRAVEL: after becoming debt free, take family vacations once a year, including some international trips
I also fully intend to set aside some money for our daughters’ college and weddings, but that will be a balancing act. They will be expected to put some money on the table for these things, too.
And so you know that it’s not all about me – I’m toying with ideas on supporting others through this blog. I have a zillion ideas running through my head, so it will take some time to research the possibilities – but expect that it’s coming!
What are your post-debt financial goals?
We are in debt. A lot of it. The only way out is to cut back, find extra sources of income, and push off some dreams. Writing about that day in and day out would get really depressing, so every Saturday I make an attempt to overcome my typically
realistic negative outlook and write about a success – no matter how small. And I’m willing to lend out this space for others to share something positive about their journey out of debt 🙂
This month was the month of the Murphy fund, and we were lucky to come by it pretty easily. But then I got to wondering if we had more funds laying around that could be tapped into for whatever God has planned. You see, we have lived in four states since being married and we open a new bank accounts with every move. We still have accounts in two other states. So I pulled up the account from our last state, not expecting it to have much, but thinking it had something. I was willing to close out the account – which we never touch anyway – and put the contents toward our debt.
We only had $300. Lower than I expected. I pulled up the account history because, like I said, we never touch the account. There were four charges in the last month. Two were recurring costs from memberships I have been paying for years and had forgotten about. Folks, this is what happens when you give up on balancing your checkbook!! The other two deductions were legitimate – a student loan I haven’t transferred to our local account and our Hulu membership. However, with our recent budgeting exercise, I had to cut Hulu out. We haven’t been using it – we favor Netflix – so I took that money out of our budget. I won’t say who was supposed to cancel the membership but it wasn’t me.
I cancelled all three memberships, saving us around $50 a month and in the nick of time. One more month and that account would have been overdrafted!
So let’s see, that’s how many failures (not balancing our checkbook, not canceling memberships that aren’t in the budget, and not monitoring or closing our old accounts) and one success. This is starting to feel like yesterday’s Five Minute Friday post – why bother posting at all? Is this really a success? Is this really positive?
Yep, I think this is worth posting. Lessons were learned. I took action instead of crawling under a rock or crying. If you are just starting to figure out how to be financially mature, maybe you needed this lesson, too?
Here are my quick and dirty, no-fluff-because-I-sleep-in-two-hour-increments-and-the-baby-will-wake-up-soon tips:
- It’s nice to have a local bank or a credit union, but if you move a lot like we seem to – go with a national bank. You’ll save yourself the hassle of opening and closing accounts – or if you are like us, the overdraft penalty when you neglect your account.
- Have a budget. When something no longer works in your budget, make sure to immediately cancel the service.
- Balance your checkbook! You’ll catch the unwanted subscriptions being deducted from your account.
- Think you don’t have any neglected accounts? Do a lost money search at places like http://www.missingmoney.com*. I once found an old account with a few hundred dollars. Yeah. It’s like I have a fetish for opening accounts and not closing them when I move.
- Monitor all your accounts, even if you think there are no deductions and nothing to balance. Identity theft doesn’t know the difference between a dormant account and one that has a constant income stream.
My poor little neglected checking account reminds me to pay attention. Not just to my finances, but to everything that matters. To pay attention to my preschooler as she begs me to not just look at her, but to see her. To my newborn – instead of my phone. To my husband, who is patiently waiting in line behind the girls and the dishes and the stack of laundry on the dining room table. And to my God, who loves me with a love that I never remotely understood until I became a mother. And even now, I feel sure that His love is something even stronger than the love I feel for my two girls. Even more tenacious. Even more fierce. Because He gave His Son for me – and that’s a sacrifice I’ll never understand. Seems like that’s worth paying attention to.
What’s your success story this week?
* As noted, we have found money this way before. I decided to enter in our name while writing this post, and there are three records for us to claim!!
Lisa Jo Baker runs a blog with a focus on encouraging moms. All moms. Stay-at-home moms, working moms. Single moms. Married moms. Moms who can’t keep their houses clean and feel weighed down by their imperfections. Moms who are frustrated and weary and wonder if they are doing “it” right. She lifts us up, holds our hands, and tells us we are doing great.
Each week Lisa Jo hosts a linkup called Five Minute Friday. The goal is to write for (just) five minutes on a one-word prompt she provides. Unedited and raw. Learning not to judge our writing too much. Learning not to judge ourselves too much. Letting it just be.
And so I join Lisa Jo’s linkup, because this blog reflects who I am as a mother, if through a lens colored by debt.
Today’s prompt is: MESSENGER
I’ve debated not writing anything at all for today. The prompt is all well and good and I’m sure plenty if other writers are taking it to really great, deep, spiritual places today. I tried to gather my thoughts and remembered phrases like “don’t kill the messenger” (yeah, I tend to be a little on the negative side) and
How will they preach unless they are sent? Just as it is written, “H OW BEAUTIFUL ARE THE FEET OF THOSE WHO BRING GOOD NEWS OF GOOD THINGS!” (Romans 10:15 NASB)
It would be easy to talk about Jesus being a messenger, but I don’t really feel that. Right or wrong, I think of messengers as being impartial bystanders who just pass along some information, and I suppose that’s why this prompt has me befuddled.
I’m not impartial or a bystander as a Christian, as a mom, or as someone figuring out my finances. I’m passionate and I have things to say. I want you to know what I have learned. I’m hoping some people are able to grow from my mistakes, to celebrate my victories with me – no matter how small, and to offer their own wisdoms in return.
I suppose I see myself as a mom who teaches her children (the best she can), as a Christian who practices (because I need to practice and make myself better), as a person studying her finances and hoping to learn. Teaching, practicing, and studying… But not passively listening to a message and certainly not impartially delivering one.
So, I actually debated not even doing the linkup today. I’ve felt like I didn’t have anything to say and this post wasn’t “good enough” and you know what? It’s not something I would write and post on just any other day, if only because the topic didn’t really bring out a strong opinion or a learning experience. It’s just is, and so no, I wouldn’t normally publish this. But remembering what Five a Minute a Friday is all about – I decided to submit a post anyway. If only so other people can see that someone else struggles to come up with words. If only so someone else can see where the mind wanders, even when you feel like there’s nothing to write about. So there you have it. May next week be better 🙂 Happy Friday!