Do one-(low)-income families ever get ahead?

stayathomemom_3

I am new here, glad to find the site.

I am a nurse and my husband barely makes over $40K a year at his salaried position. I quit my job last year, making $20K/yr, to be full time stay at home mom with our daughter.

I will skip all the boring details and say that our only debt is a $800 mortgage payment and as of now, a $2,900 credit card balance with a $35/mo payment.

This $2900 has accrued JUST in the last year. We paid off our credit cards before I quit work and they have sky rocketed up to this in no time.

I feel so discouraged right now. We have turned off our cable TV and are about to turn off our land line. We have cut off everything we can live without. After all the bills are paid and the groceries and gas are bought, we barely have $130 leftover every two weeks to spread between all other needs and expenses that may occur. As you can see from our credit card balance, we are frequently having car repairs and other things that have been outside of what we could afford. Not all of that was necessary charges and a good bit of it was learning how to adjust to a new lifestyle and curb old spending habits from when we had 2 incomes.

All that being said, when I worked we did not save anything and we had a ton more money than we have now. I don't feel like me going back to work would solve anything unless we can become disciplined with where it goes. I want to continue to live a debt-free life but there is no way we are gonna make it on one income unless we figure out a way to get ahead. And I have no idea how we'll do that.


How on earth can you spread $130 between car repairs, savings accounts, and future expenses and actually have a decent amount in those funds?? Our cars are nearing an age where they are about to cost us some money in repairs and we are in no way prepared for that either.

I'm just really discouraged and wondered if there were other families in the same boat and what you are doing to pay off debt and start saving and get out of the hole.
Right now I kind of feel like I can't squeeze blood out of a turnip.

Edited to add: I should add I am from the U.S. ;-)

Tixy

Hi

It certainly hard, and having to get used to not having your income is bound to take some adjusting to.

Maybe a useful starting point is to try to become more disciplined as you say this is not a good area for you. Have you tried both keeping a spending diary for a few months where you record everything you spend, even down to cheap items for 50cents or so? It sound tedious but its a really good way to figure out exactly where you are going.

How old is your daughter? Would it be feasible to go back part time as things are obviously really tight without any income from yourself.

Can you look back to see what the cards were spent on over the last 12months, see if there is anything you bought which you could sell on to raise a bit of money?

Welcome to the site - though do bear in mind we won't necessarily understand how all things work in the US so all the advice you might get might not work for you.

Have you seen the statement of affairs calculator we use on here? Even though some of the headings will be different for you it might still be a useful exercise for you and husband to complete to see if you can see whether you can manage without your income or if there is no way you'll be able to afford all you need. http://www.makesenseofcards.com/soacalc.html

Elsewhere

Having no idea of the cost of living in the US, it’s difficult for those of us in the UK to comment. For instance, we don’t have to pay for health care here (though some things aren’t free unless you are on a very low income); everyone with kids gets money from the government in the form of Child Benefit; if you are very poor or disabled you get other benefits...

How does the cost of food and housing/taxes/insurance compare as a percentage of income? It’s hard to suggest savings without a complete understanding of how these costs compare, unfortunately.

Maybe Moneysavingexpert needs an “Overseas” section!

stayathomemom_3

First of all, thank you for responding! I know it's difficult to give answers when we live in different countries and honestly I did not realize I joined a UK site until after I posted! I could not find any other sites that didn't require membership fees. Certainly can't add that to the mix right now!

The average household income in the U.S. is $44,000/year. That is AVERAGE, accounting for poverty stricken households as well. I think for most middle class families that I know that are not living in poverty, about $55,000/year is average.

With our income adjusted for yearly taxes, my husband's "bring home" pay is $2900/month.

Our mortgage is 26% of that.
Food is 12% of that
Gas is 12%
Utilities 9%
Car Insurance - 4%
Health insurance - 11%
Tithe to our church - 10%
Phone - 8%

So that leaves 8% for us to spread around for other needs besides bare necessities!

I will check out the link for the needs calculator. Thank you Tixy for posting that. My daughter is 2.5 now but we hope to have more children and were trying to make things work on one income until we were done having kids and the youngest was a bit older. But that may not work.

kaz0705

Didn't want to read and run. I can only echo what people have said about trying to comment on American expenses but I found it interesting that you managed to break it down into %- I might do that for mine, just to compare!

However, this forum is a MINE of information regarding food budgeting and general money saving tips. For example, if my maths is right- which it isn't often- you're spending over $300 on food? (10% being $290). I don't know how it equates with food here but that seems a MASSIVE amount to spend on two adults and a toddler! Normally the first step recommended on here is to drop a brand (often using the supermarket's own brand instead of the 'famous' one). Meal plans, batch cooking and using shopping lists should also help.

A lot of this forum probably won't be that useful re: utilities etc but there will be a host of other things that will cross the borders.

May be it's time for America to produce their own Martin Lewis?

Best of luck :-)

Nargleblast

Hello stayathomemom and welcome! Have you tried looking at other forums on this website? I am thinking in particular of the Money saving Old style forum where you can correspond with lots of people who are trying to make ends meet by being thrifty and making the most of a limited income. You will get handy tips on meal planning and some useful recipes, as well as people comparing notes about how they cope. Some regular contributors are from places like Australia or Europe, so you will not be alone. Have a look down the forums list and see, you may be pleasantly surprised.

tealady

Hi stayathomemom, or can I just call you mom for short.
There is loads of advice on here that will cross the pond so to speak. Downsizing, greenfingerered money saving, up your income, cashback and ebaying/carbooting would be good places to start.
I don't know if you can switch utilities in the US but if you can make sure you are getting the best deals and switch via a cashback website if you can.
Oh and keep a spending diary, it will highlight the things that are needed and those that are just "wants"
Good luck

dancingfairy

Like the others have said - there will be lots of things that will be equally useful whatever country you live in - ie shopping around to get the best deals on everything, doing a spending diary etc.
The currency may be different but I'm sure the feelings and difficulties are the same and I'm sure lots of people have been where you are now.
I hope you stay around and pick up lots of tips.
df

stayathomemom_3

Thanks everyone!

Dave Ramsey is the big "debt free" guy here in the U.S. and is kind of a household name. But his forum requires a minimum $10/mo fee, which I think is kind of stupid since the whole point is to help people eliminate wasteful spending and get out of debt, ha ha.

kaz0705 - maybe you were thinking in pounds when you said $300 was a lot for groceries? When I converted 300 pounds to dollars, that is quite a big grocery budget. But 300 American dollars is about 196 pounds. That is actually a very economical budget here and most all of my budget-conscious, thrifty friends are spending at least that if not more for the same size family.
Plus our economy is kind of in the toilet right now so inflation is steadily climbing.

Thanks for all the wonderful suggestions! I will try to spend some time on the site and see what I can find of useful information to me. You're all so nice! ;-)

Fiddlestick

stayathomemom wrote: »

Tithe to our church - 10%

I don't want to come across as rude, but can you not speak to your priest/pastor and see if they would mind if you didn't pay this for say, 6-12 months?

Whilst I don't want to go into your personal beliefs too much, I'm sure God would want you to have a safe and secure family life no?

Nottoobadyet

Heya - there are a few Americans on the boards, most of whom live in the UK. I was raised in New Jersey, whereabouts are you from?

One trick that a lot of people here use is multiple bank accounts - for example, when hubby gets paid put $10 ish away in a specific account for car repairs, so once those come around you'll have something saved up towards it. Another is to pay yourself first - put the money you want to put towards your debt or savings at the beginning of the month instead of waiting to see what’s left at the end.

I also agree with fiddlestick that the tithe seems really high - more than you pay for utilities! Maybe you can adjust this to a more affordable level.

And to think I always dream of moving back to America because money things were so much easier there! Can you tell I left well before the great recession?

Chin up! Best of luck dear.