Slowly Going Back Into Debt (Update/Trigger Warning #420)

[gs11rmb]

If you win your case, can your legal fees be expensed to the other 'side'?

[shanendoah]

gs11rmb - No.

Okay, I have all my numbers together. At the moment, we are $36k in debt (not counting the house). Now, thanks to the refund from the lawyer ($10.1k), not paying a mortgage this month ($2.2k), getting rid of the monthly installment payment to the lawyer ($1.7k), and the escrow refund ($1k), we'll be able to knock $15k of that to the curb this month. Of curse, that's the same $15k that might have to come back in mid June, but at least I won't be paying interest on it.

The re-fi has been completed. Our interest rate dropped by 0.8%, at least for the next 5 years. We have somewhere between 23%-33% equity.
The HELOC has been closed.

My next goal is to try and get a new budget worked out.

[shanendoah]

Okay, here's what we've actually been spending over the last 5 months, though the mortgage amount listed is the new amount. 

Income
	Paycheck	6101.92
	Rent	300.00
		6,401.92
Bills
	Mortgage		2238.85
	Utilities		297.49
	Car Insurance		104.67	paid every 6 months
	Cable/Internet		106.10
	Netflix		10.94
	Amazon Prime		9.08	paid every 12 months
	Cell Phones		15.00
	Timeshare		55.09	paid every 3 months
	Orthodontist		122.80	for the next 2 years
			2,970.02
		3,431.90
Expenses
	Gas/Parking		50.00
	Car Maintenance		0.00
	Medical		150.00
	Groceries		500.00
	Eating Out		110.00
	Pets		175.00	yearly exam cost $820
	House		40.00
	Family Expenses		520.00	clothing, personal care, activities
	Savings		20.00
			1565.00
		1,866.90

This looks really good until you realize that we've also been paying around $3,000/month is legal expenses, actually putting us short by $1,100/month. And it doesn't actually take into account legal expenses that got put on credit cards that have not been paid yet. (And I have another $1,000 bill sitting at home waiting for me to deal with it.)
So yeah, we're $36k in debt.
You may also notice that we haven't been putting anything aside for things like oil changes and car repairs. It has been a year since one of our cars has been in, and 9 months for the other one. The one is going to need an oil change soon, and probably routine maintenance, and it's likely to be around $500 (car has over 100k miles on it). Nor have we been saving for any home repairs.
Of course, now we will no longer have the $1,670/month bill to the one lawyer, so it is time to mess with the budget.

I will start by saying that nothing in the Bills category is up for debate, not even the Timeshare. We have had the timeshare for 13 years, and have used it on a regular basis. We may choose to get rid of it at a later date, but that's not a conversation we're having right now.
All the changes that will need to happen will need to happen in the Expenses category (and possibly rent from roommie #2, once he's been with us more than a couple months).

Expenses		Old	New
	Gas/Parking	50.00	50.00
	Car Maintenance	0.00	100.00
	Medical	150.00	150.00
	Groceries	500.00	450.00
	Eating Out	110.00	100.00
	Pets	175.00	100.00	the yearly exam cost will even out over 12 months vs 5
	House	40.00	50.00
	Family Expenses	520.00	470.00
	Savings	20.00	25.00
		1565.00	1495.00	total expenses
		1866.90	1936.90	budget remainder
	Legal Expenses		1935.00

With this new budget, it should take about 1 year to get out of the legal debt, assuming nothing else changes.

[finnime]

I'm impressed with your meticulous planning and balancing.

[shanendoah]

finnime - So I am a control freak. I simply feel better when I have a plan. This doesn't mean the plan will execute the way I want, but, I function SOOOO much better when there is a plan.

[raeoflyte]

Shane--do you have a menu plan handy that you would be willing to share?  Groceries/eating out is where we have consistently overspent for years and are really trying to reign it in.  

[shanendoah]

raeoflyte - We don't menu plan. Not eating out is easier, given that C is at home, but I can share the tips we've learned.

1) Keep your pantry stocked with quick & easy things you like. Our go to meal when no one has thought about dinner is rice with cream of mushroom soup. We also keep stocked on pasta and basic pasta sauce. Throwing rice in the rice cooker or boiling water for pasta are both quicker and easier than going out to dinner. We also have pot stickers and tamales which can pair with rice for a quick and easy dinner straight from the freezer.

2) Keep your pantry stocked with spices you like. We buy CostCo size versions of Italian herbs, curry powder, chili powder, taco seasoning, etc. So if we want curried chicken for dinner, it's just as easy as just making the chicken without the curry.

3) George Forman grills are your friend. Hamburgers don't need to be thawed before throwing them on the George Forman

4) Limit your proteins (as in what you buy). We buy bone in, skin on chicken thighs and ground turkey. Buying any other kind of protein happens at most once a month, but often only for special occasions (Easter Ham) or if C sees a really good deal on a roast. 

5) Limit your proteins (as in what you eat). We generally have at least one no meat dinner a week. In addition, if I am making something that calls for 1lb of ground meat, I double the recipe for everything except the ground meat. In general, people in the US eat a whole lot more protein than we need, and since meat is often the most expensive part of a meal, limiting it has no negative health effects and helps your budget. 

6) Eat your carbs. Carbs are filling. Carbs are cheap. We have a carb with every dinner. Rice is our most common, but also pasta, or potatoes. Beans work well for others (I hate beans, so not for me). If I make tacos, I also make rice, because without the rice, we end up eating all the taco meat in one dinner. With rice, we have tacos for two nights.

7) If you have space to store it, buy in bulk. Even when there were only 2 of us, we have always shopped at CostCo. Potatoes, pasta, cereal, rice, cream of mushroom soup, etc - none of those things go bad. (Okay, potatoes do eventually, but not that quickly.) We use part of our garage as a pantry. We also have a chest freezer, so we can buy our meat at CostCo, too. It helps keep the pantry stocked and keeps grocery prices down.

8) Be willing to eat leftovers. Even with C at home, we don't cook every night. We cook at most every other night. We plan for left overs. Most of the dinners we make will be dinner for two nights for the whole family, and 2-4 servings of lunch, as well. 

9) If your kids are willing to cook, let them. Pop Tart loves pancakes. She likes making pancakes. On really crazy nights for us - pancakes for dinner made by Pop Tart. She can also make mac n cheese, or pasta and sauce.

10) Instead of meal planning what you'll have at home, plan when you'll go out to eat. I look at out schedule each week, and if there's a night I think we'll end up going out to dinner, I plan for it. It can give something to look forward to, but for me, the planning for it is the key. I am not saying Papa Murphy $10 Tuesdays never have a last minute impact, but its a lot less if I know we're going out to eat later in the week.

11) Even if you don't strictly meal plan (like us), make a plan for your busiest nights. We generally do "Sunday Family Dinner" with friends every Sunday. Most weeks we cook, which means we have left overs for Monday. It is always best to have quick and easy for Monday. On weeks when we don't cook, we make sure we have other leftovers, or some other quick and easy plan for Mondays. Thursdays are our other really busy night, so we often make sure to cook on Wednesday specifically so we have leftovers for Thursday, or we have some other plan in place, so that we know exactly what we're doing for dinner on Thursdays.


I know these tips won't work for everyone. We have a house with a garage and chest freezer, a rice cooker, electric griddle, and George Forman grill, so we have places to store food for buying in bulk and gadgets beyond the microwave that make cooking food quicker and easier. Our kid is old enough to do some cooking and likes to do some cooking. We have a CostCo nearby, and have the executive membership and the credit card. We spend enough at CostCo that the executive membership cash back pays for the executive membership, and then the card cash back pays for one shopping trip a year. 
I don't coupon, but Safeway is currently doing a Monopoly promotion, and I do play that. We've gotten lots of instant winner "free" things. Not always things we would get otherwise, but free salad mix isn't a bad thing, or free bags of shredded cheese.
We drink a lot of Coke in our house (or I should say, I drink a lot of coke), but I only buy it when the deal is 3 12-packs for $10 or better. But then I stock up. (Which is hard, because I drink Diet Coke with Splenda, and they don't always carry a lot of it, but we live equidistant from two different Safeways.)

But for us, the real key isn't necessarily planning what we will cook, but planning the nights we will cook, combined with having a pantry stocked with things we actually like.

[Deleted]

Can I ask how you keep your car insurance for two cars down to $200 a year.  I'm sure that is liability only, but that's unbelievably cheap at $100 a year per car.  Who is your insurer?  The gas is also unbelievable cheap at $50 for two cars per month. 

[shanendoah]

@bamafan1954 - That's me not being quite clear. I pay around $1,250/year in car insurance. The monthly expense is $105, though I don't pay it monthly, I pay it every 6 months. (If I paid monthly, it would be like $120/month - we get a pretty good discount in exchange for having 2 big bills/year.)

C took the sedan in for an oil change today. We need about $1,600 in work done on it (not counting brakes)- car has over 130k miles, and hasn't been serviced in a year. We'll end up taking it to Les Schwab for brakes. C called around, and the garage it's at is cheaper than the dealership for the work we need done. It sucks, but as I told him, we have around $1900 in savings, and right now, all this really does is put us paying off credit card debt for longer. 

[Shooby]

May 10, 2017 11:49:18 GMT -5 shanendoah said:

raeoflyte - We don't menu plan. Not eating out is easier, given that C is at home, but I can share the tips we've learned.

1) Keep your pantry stocked with quick & easy things you like. Our go to meal when no one has thought about dinner is rice with cream of mushroom soup. We also keep stocked on pasta and basic pasta sauce. Throwing rice in the rice cooker or boiling water for pasta are both quicker and easier than going out to dinner. We also have pot stickers and tamales which can pair with rice for a quick and easy dinner straight from the freezer.

2) Keep your pantry stocked with spices you like. We buy CostCo size versions of Italian herbs, curry powder, chili powder, taco seasoning, etc. So if we want curried chicken for dinner, it's just as easy as just making the chicken without the curry.

3) George Forman grills are your friend. Hamburgers don't need to be thawed before throwing them on the George Forman

4) Limit your proteins (as in what you buy). We buy bone in, skin on chicken thighs and ground turkey. Buying any other kind of protein happens at most once a month, but often only for special occasions (Easter Ham) or if C sees a really good deal on a roast. 

5) Limit your proteins (as in what you eat). We generally have at least one no meat dinner a week. In addition, if I am making something that calls for 1lb of ground meat, I double the recipe for everything except the ground meat. In general, people in the US eat a whole lot more protein than we need, and since meat is often the most expensive part of a meal, limiting it has no negative health effects and helps your budget. 

6) Eat your carbs. Carbs are filling. Carbs are cheap. We have a carb with every dinner. Rice is our most common, but also pasta, or potatoes. Beans work well for others (I hate beans, so not for me). If I make tacos, I also make rice, because without the rice, we end up eating all the taco meat in one dinner. With rice, we have tacos for two nights.

7) If you have space to store it, buy in bulk. Even when there were only 2 of us, we have always shopped at CostCo. Potatoes, pasta, cereal, rice, cream of mushroom soup, etc - none of those things go bad. (Okay, potatoes do eventually, but not that quickly.) We use part of our garage as a pantry. We also have a chest freezer, so we can buy our meat at CostCo, too. It helps keep the pantry stocked and keeps grocery prices down.

8) Be willing to eat leftovers. Even with C at home, we don't cook every night. We cook at most every other night. We plan for left overs. Most of the dinners we make will be dinner for two nights for the whole family, and 2-4 servings of lunch, as well. 

9) If your kids are willing to cook, let them. Pop Tart loves pancakes. She likes making pancakes. On really crazy nights for us - pancakes for dinner made by Pop Tart. She can also make mac n cheese, or pasta and sauce.

10) Instead of meal planning what you'll have at home, plan when you'll go out to eat. I look at out schedule each week, and if there's a night I think we'll end up going out to dinner, I plan for it. It can give something to look forward to, but for me, the planning for it is the key. I am not saying Papa Murphy $10 Tuesdays never have a last minute impact, but its a lot less if I know we're going out to eat later in the week.

11) Even if you don't strictly meal plan (like us), make a plan for your busiest nights. We generally do "Sunday Family Dinner" with friends every Sunday. Most weeks we cook, which means we have left overs for Monday. It is always best to have quick and easy for Monday. On weeks when we don't cook, we make sure we have other leftovers, or some other quick and easy plan for Mondays. Thursdays are our other really busy night, so we often make sure to cook on Wednesday specifically so we have leftovers for Thursday, or we have some other plan in place, so that we know exactly what we're doing for dinner on Thursdays.


I know these tips won't work for everyone. We have a house with a garage and chest freezer, a rice cooker, electric griddle, and George Forman grill, so we have places to store food for buying in bulk and gadgets beyond the microwave that make cooking food quicker and easier. Our kid is old enough to do some cooking and likes to do some cooking. We have a CostCo nearby, and have the executive membership and the credit card. We spend enough at CostCo that the executive membership cash back pays for the executive membership, and then the card cash back pays for one shopping trip a year. 
I don't coupon, but Safeway is currently doing a Monopoly promotion, and I do play that. We've gotten lots of instant winner "free" things. Not always things we would get otherwise, but free salad mix isn't a bad thing, or free bags of shredded cheese.
We drink a lot of Coke in our house (or I should say, I drink a lot of coke), but I only buy it when the deal is 3 12-packs for $10 or better. But then I stock up. (Which is hard, because I drink Diet Coke with Splenda, and they don't always carry a lot of it, but we live equidistant from two different Safeways.)

But for us, the real key isn't necessarily planning what we will cook, but planning the nights we will cook, combined with having a pantry stocked with things we actually like.

Those are good tips!  One thing that i have found that works is to slice down the meat.  Say you buy a steak, for the 5 of us, instead of buying 5 steaks I buy 2 big ones or 3 small ones.  Then after grilling it or cooking it, i then thin slice it and portion it out.  They actually like getting the meat already sliced and that is a very easy way to make it go further because as you said, portion controlling the meat is better healthwise and $ wise as well.

[shanendoah]

With tax, the work done on the sedan was around $1,700. We still need to get it in for brakes. The wagon is due in for an oil change early next month. It has over 200k miles on it. Hoping it doesn't turn into a thousands of dollar job when it goes in.

We will pull some money from savings for this, but will also cash flow some of it. It will slow down debt repayment, but that is what it is. I also have to make a $1,000 payment to my lawyer today.

[shanendoah]

For future reference, even if you file jointly, when making an online payment to the IRS, enter the SSN of the person you list first on the tax form. Because if you make the payment under the joint person's SSN, they will just think you gifted them that money, and then send you a bill for your tax payment.

Spent 40 minutes on the phone this morning getting our tax payment (made 4/13) credited to our taxes. 

[finnime]

Really good to know about the IRS payment thing. TY

[Shooby]

I really don't understand all these lawyer payments.

[Blonde Granny]

No sarcasm intended with this statement: Lawyers will get paid one way or the other.

[zibazinski]

That's for sure.

[shanendoah]

Shooby - Until the most egregious part of this case is resolved, I won't be posting any details about the actual situation. But, basically, we are involved in a complicated legal issue that at this point in time requires 3 different lawyers. The lawyers are tiered based on the importance of their part of the case to us - lawyer 1 is actually the absolute best in the state for what we need, but that comes with a price tag. Lawyer 2 is the 2nd best person in the state at what they do (or, at least the lawyer that the person identified as the best person in the state referred us to when they couldn't take the case). Lawyer 3 is someone with extensive experience (but not in the top tier), whose main job is to keep that part of the case from messing up the other parts of the case.

For legal reasons, this must be handled by at least 2 different lawyers. Technically, Lawyer 1 could also be doing Lawyer 3's job, but the amount of extra time it would take would add so much extra expense to Lawyer 1 (who is decidedly more expensive than Lawyer 3) that it becomes not worth the cost, at least for what we need from Lawyer 3 right now.

But the base answer is that complicated and complex legal situations are expensive and time consuming. And these are expenses that we deem necessary.

[Shooby]

Hope you can resolve this soon!

[dee27]

May 30, 2017 17:51:01 GMT -5 Shooby said:

Hope you can resolve this soon!

Me, too.

[shanendoah]

For those who are following along (and I can't remember if I've given dates here before or not), we had a check in yesterday for the part of the case Lawyer 1 is handling. There has been another (not surprising) delay. Until yesterday, worst case scenario had this ending mid-July. We're now pushed out to mid-August. However, we have our next check in June 30. Lawyer 1 has stated he won't let them push this out anymore, so we should have a really good idea (if not certainty) about whether this will go worst case or not in another 3 weeks.

[debthaven]

I'm sorry about the delay, it must be so nerve-wracking.

[Jaguar]

I'm wishing you all the best shanendoah, that this situation revolves itself in your favour.

[shanendoah]

It is possible the most egregious part of this will be over by the middle of this month. If not, guaranteed it will be resolved by the middle of next month. But hoping for sooner. Because middle of next month means trial, which is always iffy, and also means another $15k (to lawyer A) out of our pockets.

In bad news/good news, on the bad news front, our new mortgage company did not pay our homeowners insurance due in June. Policy will be cancelled if not paid by July 13. We have plenty of money in the escrow account for it. I called the mortgage company on Monday and faxed (?!) them the notice I got from the insurance company. The person I talked to said it should be taken care of quickly. I'll be watching my escrow account to make certain.
On the good news front, we got a $1,270 refund of the escrow account from the last mortgage company. 
Of course, part of that went instantly to Century Link (the finally got fiber optic in our neighborhood and we switched from Comcast to Century Link) which will do autopay from my checking account for free, but charges me $3.50 to pay via a credit card. So that's set up from the checking account (which is going to be a pain, but I'll figure it out). The other part has then gone to lawyer C, who also can't take credit cards.
I still need to make a $1,200 payment to lawyer B, but that can go on a credit card.

I will end up with another big bill from Lawyer B this month, but then, if all goes well, everything should just be little bits here and there until after Thanksgiving.

[dee27]

Shane, I hope the resolution is soon.

[TheOtherMe]

I hope this is all over soon and in your favor.

[Works4me]

For those who do not take credit cards, can you use a check from the credit card? 

Also, here's hoping it comes together the middle of this month for your benefit.

[tcu2003]

We are just past the middle of the month. Any updates? Hoping for resolution for you guys!

[shanendoah]

Officially, the can has been kicked down the road another couple of weeks.
Unofficially, we have a resolution. It sucks. I hate it. It's also probably the best of the options we have. However, until we get the official part taken care of, it could also change.
Life sucks. I am not okay. I am not going to be okay any time soon. But there is a foreseeable future where life does not suck so much, and so I will keep on keeping on until we get there.

[azucena]

Shan - I know I've mentioned before about my friend who's husband also had legal issues. I still can't get over how long it takes to work thru the court system and how it puts your whole life in limbo while it's sorted out. It's been 2 yrs since his verdict which did not go in his favor. I will tell you that their marriage is much better. She got a better job and they are moving to another city to kind of start over. I was truly thankful for how much better she was doing when I saw her a few weeks ago.

All that to say - there is hope. You can move on and put this behind you. Definitely keep holding onto that brighter future off in the distance. You work hard and are sensible so you will get thru this.

[taz157]

I'm sorry Shane it didn't go the way you wanted. ((((Hugs))))