Help!! I need to have a place of my own by June

[leelaughs]

Hello,

Here is my info. It's not pretty!! Help find a way to trim and cut and be able to afford at least a $750 a month place to live for myself and my 11yr old. Credit cards are the minimum payment due. thanks
Rent 400.00
Savings Account 60.00
Gas 150.00
Cell Phone (2line) 107.00
Student Loan 242.50
Grocery 200.00
Entertainment/ eating out 200.00
Karate 102.00
Storage 42.00
School lunch 60.00
HOUSEHOLD TOTALS $1,563.50

Creditone 28.00
Target 25.00
Chase 30.00
Capital One #1 16.00
Capital One #2 15.00
Sears 15.00
Paypal 28.00
Walmart 20.00
PERSON 1 TOTALS $177.00


TOTAL BILLS $1,740.50
FREE MONEY $247.50

INCOME AMOUNT
PERSON 1 $1,988.00
TOTAL $1,988.00

[Deleted]

Quick question: What are the balances and percentage rates of your CC's and debts?

[Pants]

Your current rent is $400--if your actual expenses are listed, and you do have $247 extra at the end of the month, to get to a place where you can afford $750 you only need an extra $103. This is manageable.

1--Cut the cell phone, go to pay as you go plans.
2--Cut entertainment by $100.
3--When you move in your new place, get rid of the storage unit for $42.

Those are the obvious ones, buy you don't include insurance...

[Deleted]

Also....does your child live with you full time? If so, are you getting any kind of child support? Why at least $750 for an apartment? Does the cost really matter if you can find what you want for cheaper? What type of apartment are you looking for (1BR - 2BR)?

[8 Bit WWBG]

Its not pretty but its not impossible. The things you have total control over and could cut tomorrow are:

- Entertainment/Eating out
- Karate
- Grocery

The things you may be locked into a contract over, but could reduce:

- Cell Phone
- Storage
- School lunch

CAN you cut the cell phone or reduce it? Before DF and I got smartphones, our phone bill was $80/mo.

If you were able to cut the entertainment in half, give up karate for a while, and trim a bit from groceries, you could find another $250/month. If you were able to get rid of the storage units and the cell phone, you might get that up to $350/$400.

You are probably going to get a lot of extreme advice from here. They'll say cut your cell phone entirely and get a pre-paid phone just for emergencies (though you'll probably reply that you are locked in a 2 year contract). They will also say to cut out all eating out and entertainment and find free things to do.

What are the interest rates on your debt, and what are the total balances? If any of those are close to being paid off, that might free up some money.

And do I want to ask why you suddenly need your own place?

[spartan7886]

Do you need $750 on top of the $400 you pay now or is that the total?

The first thing that jumps out at me is the cell phone - does your 11yo really need their own line?
Your entertainment/eating out budget has lots of room to cut. Eating out should probably become an event, rather than a common occurrence.
What is in your storage unit? Can you sell it? If it is in storage, I would assume you are not using it. That would free up $42/mo plus provide a pile of cash to put against a credit card bill.
You can also probably make lunch cheaper than the school lunch.

That is probably around $200, which together with your current rent and some of your "free money" will get you to $750.

I assume Karate is for the 11yo and not you. If it comes down to karate or a place to live, the kid will survive, but that is the last thing I would cut and I don't think you need to.

You are missing bills, though. I see gas, but no car insurance. I'm hoping that income is net, after health insurance. Where are gifts, clothes, haircuts, etc? You may not need to buy clothes very often, but I'd bet your 11yo is still growing.

How did you run up the credit cards? Do you have a pattern of living on them or was it a single event that triggered it? I hope all that free money is right now going to pay those down (snowballing, of course, via the highest interest or lowest balance method).

How much is in the savings account? You will want a cushion of $500 or $1000, but if you can pay those credit card bills down, that will give you more cashflow.

[stats45]

This would be tough. Not only would the rent be $350 more than you are paying now, but you would probably incur other expenses. How much would you pay for utilities in your area? Would you expect on paying for internet service/cable? If so, these expenses could push your expenses up another couple hundred dollars.

[qofcc]

The obvious one is the cell phone and if that's your primary line, you probably don't want to go with a prepaid. Do you have any friends or relatives with the same carrier who would be willing to transfer your phone to their account? You can transfer a contract to a family plan without canceling it and you can always transfer it back. (at least Verizon let us do that). Also, are there any features you can cut such as downgrading from unlimited texting to a limited text plan?

Can you cut the gas by finding a place that reduces your commute?

You could easily cut the entertainment/eating out.

What is so valuable that you're paying $500/yr to store it?

Are you/will you be eligible for free/reduced school lunches? Could your child take a bag lunch at least some of the time?

Could your child choose a less expensive activity or could you find a less expensive Karate instructor or could you cut back on the number of lessons per month? Instead of weekly guitar lessons for $60/month, we split the time with another student and each had bi-weekly lessons for $30.

Can the student loan payment be adjusted based on your income?

[leelaughs]

Ok, I'm gonna try to answer all the questions:
I am currently living with my mother.. her new boyfriend has pretty much moved in and has a nasty temper.. I don't want my son around him. I was hoping to last until June so I don't disrupt his school year. The reason I say $750 (the $400 would be included in that) is because there is not much around me for less that.. I've been looking, i live in a very rural area and one of the highest counties in pa. Right now i am 45min from work. The reason for the credit card debt-- does being stupid count?-

credit cards:
#1- balance 545.83 23.99%
#2- balance 412.64 22.99
#3 balance 406.44- 0% but not sure till when
#4 balance 840.06 29.99
#5 balance 140.99 25.24
#6 balance 399.00 23.99
#7 balance 161.26 22.90
#8 balance 663.00 26.99

bschoolbound: I drive a company car so I have no car insurance and my health care is covered by my employer
finacialtexan: My son does live with me full time. I do not get CS- his dad is on SSI - the low income kind not the disability kind - i would like a two bedroom
WeWillBackGowron: I believe that I have a contract with the Karate until Sept 11. I would have to check on that. As for the cell phone- I have no house phone and my son is alone in the mornings for a couple hours so i don't feel right leaving him with out a line. His part of the phone bill should go down in the next couple months.

Savings account $1115.00
401K 3% before tax and the employer matches it

I probably didn't get everything- sorry
I may not be able to post again till tomorrow

thanks for all the help

[qofcc]

The interest rates on your cards are highway robbery. As long as you feel you have your spending under control and are not in danger of running up the cards again, I would recommend keeping $500 in savings, then putting the rest of the savings, plus your $60/month toward the cards, starting with the Chase & Capitol 1, not the store cards, save those for last. If you have a true emergency, you should be able to pay for it with one of your major credit cards.

I believe that I have a contract with the Karate until Sept 11

Most places will let you suspend your contract for several months or a year. It's worth asking about.

[973beachbum]

Lee, I agree with WWBG on most but have one question. You list $400 a month for rent and say the new place would cost $750 a month.

What about utilities? I assume they are included in your current rent but would they be included in the new apartment you would rent for $750? If not then that additional $350 a month would actually be even higher.

I would also say that the $60 in savings scares the crap out of me. Is that really your only savings? If it is I think you really need to consider at least a couple of months of really frugal living and squirling away the $247.50 extra plus the entire entertainment/eating out and the Karate.

Just two months of this would be $247.5+102+200 times 2
For a grand total of $1099.

I am not suggesting that you try and do that permantly but even just for 2 months it would give you a thousand dollar cushion that IMHO would go a long way to giving you and your DD the security that you seem to so greatly desire.

[patchwork150]

hello and welcome ;D hope we can all help you out!

will you need to match the $750 rent with a deposit? It would be a bad idea to empty your savings for a deposit.What do you do for unusual expenses- school supplies, shoes, clothes, car registration, doctor/dentist visits, etc?

I don't see utilities or tv listed.

#1- move as close to work as possible, that should help with lowering your gas bill.

#2- I second the previous poster, get rid of that storage unit. Either put what you have in your house or sell it/give it away.

#3- the karate if you can, until you can afford it again. You need breathing room!

#4- is there any way you can consolidate some of the credit cards? my parents went to a credit union who were able to help them consolitate at a much better interest rate. With the interest as high as you have listed, you'll be paying on these for a LONG time without making headway (minimum payments).

#5- cut the entertainment & eating out as much as possible. you can buy frozen pizza or make it cheaper, and it is still quick and fun. Do as many free activities as possible.

#6- do as much as you can to earn more. Maybe you can babysit the odd child on the weekend, collect/return bottles, work an hour or two overtime once in a while, so on.

The worst part of your budget is the minimum payments on debt. WIRR can help you with ways to pay it off as quickly as possible- you would have much more room in your budget without them!

I would strongly recommend taking the $60 you are saving every month and applying it to the lowest balance debt- you are not saving in the long run by carrying interest rates so high. You could pay off balance #5 in 2 months. Then you could pay off balance #7 in another two months, and so on. This is called snowballing, where you take the payment you were paying and add it to the next balance and so on.

[patchwork150]

Once you pay off debt, save hard. 1k is enough for emergencies for a short time until you can pay your debt. Why would anyone want to save 60/month at an interest of probably 1% or less, vs. pay credit cards at an interest of 25%+??

[whoisjohngalt]

Is there anything you can do to increase your income? Yes, you cut a few things here and there, but it's sooo tight and your lack of savings, would make me worried.

Lena

[patchwork150]

Mar 10, 2011 17:25:21 GMT -5 973beachbum said:

Lee, I agree with WWBG on most but have one question. You list $400 a month for rent and say the new place would cost $750 a month.

What about utilities? I assume they are included in your current rent but would they be included in the new apartment you would rent for $750? If not then that additional $350 a month would actually be even higher.

I would also say that the $60 in savings scares the crap out of me. Is that really your only savings? If it is I think you really need to consider at least a couple of months of really frugal living and squirling away the $247.50 extra plus the entire entertainment/eating out and the Karate.

Just two months of this would be $247.5+102+200 times 2
For a grand total of $1099.

I am not suggesting that you try and do that permantly but even just for 2 months it would give you a thousand dollar cushion that IMHO would go a long way to giving you and your DD the security that you seem to so greatly desire.

she already has more than that in savings. I think it's time for her to get rid of her extremlely high interest debt, then save as much as possible when she pays it off.

[azphx1972]

There is no easy solution here. You're going to have to look hard at your expenses, and eliminate as many wants as necessary to come up with the extra cushion in your budget for a place of your own. And like the above poster says, look at ways to increase your income. Good luck.

[973beachbum]

My son does live with me full time. I do not get CS- his dad is on SSI - the low income kind not the disability kind -

Does your son get SS? Because if he doesn't then I think he should. Check out the SS website but minor children of people who recieve SS are entitled to benefits also.

www.socialsecurity.gov/retire2/yourchildren.htm

[patchwork150]

I plugged the numbers in the calculator. If you snowball the way it recommends, you'll have the debt paid off in 16 months using the $60 a month you currently save + the minimum payments. Increase your income any way you can, cut your spending, pay your debt off- and you'll be in a much better place in less than a year and a half.

I agree, look for any programs that will help you out. I know that you can get lower prices for school lunches based on your income for instance. You can do some of the food services to lower your grociery bill (I think it's angels food ministries, where you can order cheap food?) Like I said, there are so many people in the WIRR that can help you!

Good luck!

[973beachbum]

she already has more than that in savings. I think it's time for her to get rid of her extremlely high interest debt, then save as much as possible when she pays it off.

I didn't know that when I typed it but, she isn't going to have the same stable living enviorment by June.

If I had to choose between having no credit card debt but no savings while being the sole support of my kid and having a nice healthy cash cushion of savings with which to pay my bills including the CC's I would choose the latter everytime.

Paid off CC;s are nice but that won't normally help you pay the rent when an emergency crops up. Which normally just leeds to more CC debt.

[patchwork150]

Mar 10, 2011 18:02:03 GMT -5 973beachbum said:

she already has more than that in savings. I think it's time for her to get rid of her extremlely high interest debt, then save as much as possible when she pays it off.

I didn't know that when I typed it but, she isn't going to have the same stable living enviorment by June.

If I had to choose between having no credit card debt but no savings while being the sole support of my kid and having a nice healthy cash cushion of savings with which to pay my bills including the CC's I would choose the latter everytime.

Paid off CC;s are nice but that won't normally help you pay the rent when an emergency crops up. Which normally just leeds to more CC debt.

true. But she is lucky/smart enough to have a 1k emergency fund. How much do you think she should have before getting rid of her debt? It's costing her a lot in interest, and $177/month of her budget. Even if she took an extra $20 and snowballed, she would save herself some $ in the long haul. If she paid her debt in 16 months, she could then save the $177+$60 a month.

[Deleted]

Have you checked to see if your son qualifies for the reduced lunch program? It usually also includes breakfast. The school is very discreet in how they handle it so your son shouldn't be embarassed. I find it hard to believe that with your income you wouldn't qualify.

[haapai]

The good news is

• Many of your line items can be slashed at least temporarily.
  
• Your debts, although they have awful interest rates, are individually quite small.
  

The bad news is

• You're not going to like a lot of the changes.
  
• You're missing a lot of expenses.
  
• When the missing expenses get added into your budget, your resulting budget will probably be unbelievably tight and unsustainable in the long term.
  
• You may have difficulty finding someone willing to rent to you, given your finances.
  
• Once you have eliminated the fat from your budget, the remaining ways to regain discretionary income are to either earn more or eliminate your debts. Getting those debts taken care of is going to require another mess of agonizing choices and risks.
  

Have you considered getting a one-bedroom for less than $750 a month and putting your son in the bedroom and your stuff in the hallway closet? It's a grim way to live, but in light of what you've told us, it may be the best route to a building a better, more sustainable budget. Unless you get frequent financial windfalls that you haven't mentioned yet, you could make more financial progress in a year of living like that than in several years of struggling with higher expenses. Plus it’s plenty motivating.

Have you filed your 2010 returns yet?
Are you on an income-sensitive repayment plan for your student loans? Are you familiar with the list of deferments and forbearances?

[973beachbum]

Mar 10, 2011 18:04:56 GMT -5 patchwork150 said:

Mar 10, 2011 18:02:03 GMT -5 973beachbum said:

I didn't know that when I typed it but, she isn't going to have the same stable living environment by June.

If I had to choose between having no credit card debt but no savings while being the sole support of my kid and having a nice healthy cash cushion of savings with which to pay my bills including the CC's I would choose the latter every time.

Paid off CC;s are nice but that won't normally help you pay the rent when an emergency crops up. Which normally just leads to more CC debt.

true. But she is lucky/smart enough to have a 1k emergency fund. How much do you think she should have before getting rid of her debt? It's costing her a lot in interest, and $177/month of her budget. Even if she took an extra $20 and snowballed, she would save herself some $ in the long haul. If she paid her debt in 16 months, she could then save the $177+$60 a month.

I am not anti paying off credit cards. ;D But in her case I don't think she can move out into an apartment that isn't owned by a family member and pay off her credit cards.

For the next 2 and a half months she needs to both pay all her bills and save enough to rent an apart ment that will cost a minimum of $750 a month. Plus she will need at least 1 months security and first months rent just to get in. Plus she will probably need a security deposit for her electric and heat utilities to boot. With that I think she is going to need at least $2000 to use to get into the apartment and then she has to pay all her bills too. And even if she takes ever spare penny for the next two months she will still only have $2000. Her saving will be wiped out once she writes the check to move in.

IMO the OP needs to save every spare penny you can so you can rent an apartment and pay things like security deposit. Once you are in in all likelihood your savings will be completely depleted. You will have to spend the next couple of months building it back up. Paying off CC's is nice but as strange as it is for me to say it she just can't afford it right now.

OP there were a lot of great suggestions. Especially seeing if your credit union can consolidate your credit cards into one payment that is lower. And calling up your SL company and seeing if you can go on Income Based Repayment plan.

And I still think you need to go to Social Security and discuss that your minor child has a father on SSI and how can you sign him up.

[Peace77]

You can't afford to spend $750 per month for a 2 bedroom apartment. Even if you find a landlord that includes heat, you will need to pay electricity.

Look into renting a 1 bedroom with a den which are sometimes available for about the same price as a 1 bedroom.

Another option that might be even better for you is to look into a Senior House Sharing Program.

Here is a flyer for one program. If that's not in your area, they should be able to refer you to one that is closer. Or call your local United Way or Senior agency.
www.ywca.org/atf/cf/%7BD3CA6459-BAA9-42E1-9706-33B2DE045980%7D/Senior%20Shared%20Housing.pdf

You can't afford to be spending $200 per month for entertainment/eating out right now. Cut that down to $5-10 for now. Save as much as you can for your moving expenses and deposit(s). Bring food from home and use a crock pot to make inexpensive meals instead of eating out.

Use your local library instead of paying for entertainment.

Unfortunately, your son is not eligible for SSI benefits unless he is disabled himself. From SSA.gov "SSI benefits are based on the needs of the individual and are only paid to the qualifying person. There are no spouse's, children's or survivors benefits payable."

[leelaughs]

Hi,
thanks for all the great advice.
I understand that cutting the entertainment and eating out is VERY important.. I am going try my best there.
I need to look into the student load reduction. I had taken one year of forbearance a couple of years ago and I think I can do that one more time, but I'm not sure about reducing it.. i will go on the website today and see what it says.
I do not qualify for free/ reduced lunch- i make about $35 to much. we did apply- packing is a good suggestion.. my son liked the idea..so i think we are going to try that out.
I also tried for SS for my son but because his dad is on SSI and not SSD - he can't get it.

I was seriously debating taking my savings and paying off a couple credit cards but i was afraid because I know that I will need a security deposit and 1st months rent. I was hoping for more time at my moms, but the situation is not good for my son.

Right now I am not paying any utilities- i am supplying most of the food for the house- so when i do get a place i will need to be able to pay for electric and heat. i can live without cable, but i would like to have the INTERNET for my son.

So my best bet for the credit cards is snowballing? Should I start with the littlest one or the biggest one or the one with the highest interest?

Thanks again.. hope i answered all the questions

[qofcc]

I was seriously debating taking my savings and paying off a couple credit cards but i was afraid because I know that I will need a security deposit and 1st months rent.

That's smart, but after you're in the apartment and have your final budget, you should consider it.

So my best bet for the credit cards is snowballing? Should I start with the littlest one or the biggest one or the one with the highest interest?

Provided the credit lines are not frozen, I would do them in this order:

Pay these 3 first because they are major cards that could be used anywhere in an emergency, start with smallest balance first to reduce minimum payments:

Capital One #2 15.00 #5 balance 140.99 25.24
Creditone 28.00 #1- balance 545.83 23.99%
Capital One #1 16.00 #4 balance 840.06 29.99

This one next, because the interest rate is highest and if you needed to, you could use it to buy groceries or other necessities:
Walmart 20.00 #8 balance 663.00 26.99


These next with the lowest balance first:
Paypal 28.00 #7 balance 161.26 22.90
Sears 15.00 #6 balance 399.00 23.99
Target 25.00 #2- balance 412.64 22.99

This one last unless the interest rate jumps, then move it to the top of the list:
Chase 30.00 #3 balance 406.44- 0% but not sure till when

[The Walk of the Penguin Mich]

Is there any chance you can not pay rent at your mom's for the next 3 months (I'm assuming you're giving her $400 currently).

Quite frankly, you're going to need a minimum of about $2000 to move out, between first month rent, security deposits, turning on utilities and stupid stuff like shower curtains, trashcans and brooms. Not only that, the first couple grocery shopping trips when you move into a new place are going to be high as you'll need to buy all the things that you'll need to stock a pantry. That $400 will give you another $1200 by June and I suspect that you'll need every dime of it by the time you've moved.

If you could wait a couple more months, until Aug., another couple of credit cards could be paid off to give you a little breathing room. You don't have a lot as it is.

[Wisconsin Beth]

what about your taxes? Do you get a big refund? Can you adjust your withholding to get more back during the year? Have you done your 2010 taxes already?

[leelaughs]

My mother needs the $400 to keep paying her mortgage.. i not sure exactly what she is going to do when I move but she has chosen.. the boyfriend over us.. so I have to leave.

I did file taxes - my savings is what is left after i paid some personal loans--

I looked at my student loans.. it does look like I qualify for IBR- and I also have an option of a 1 yr forbearance- (my only one left)
which do you think is the better option.. the IBR or the forbearance?

[qofcc]

I also have an option of a 1 yr forbearance- (my only one left)
which do you think is the better option.. the IBR or the forbearance?


The IBR. You can always switch to the forbearance if you need to.