Debts, Babies and Everything Else!

[ilovemygirl]

I know this will be long. Thank you in advance to anyone who reads this novel of mine. I'd really appreciate all your insights and advice ...

We are getting a lot more in our tax refund than expected. It's exciting because we can pay off all our credit card debt and one of our car loans with it. After that we will still have our other car loan but that will be our only debt. I should be so super excited but all I can feel is nervous and stressed out. Here's why ... 

I decided to attack our debt and change our lifestyle two years ago. I was a full time SAHM at the time and we had massive debt ... 25k on credit cards alone. I started by scrimping and saving for a year. I got pretty good at it but it didn't feel like enough so I got a job babysitting full time so I could make some extra cash but still be with my dd. It helped but after a few months it still didn't feel like enough so I added a second job which is out of the home on the weekends. Hubby is with dd at those times so we have no childcare costs. It's been hard on us as a family but it's really paid off (excuse the pun, lol). 

Anyway, dh has always kind of seen this as a temporary thing. That once the debt was gone we could go back to "normal". That we'd be able to spend again and I'd be at home again. It's a really nice thought. I'd LOVE for that to be possible but it's not realistic.  

Here's the quick breakdown of our finances ...

First - Even with our credit cards and one car loan gone dh's salary will just barely cover all of our necessary monthly expenses like rent, food, insurances, etc. It does not count towards anything like emergencies or savings and definitely not anything extra like gifts and vacations and such. It's ridiculous to think we could even make it a couple of months without something popping up that needs attention, without ever buying something extra for dd, without ever going out to eat, etc. Needless to say, it would all start going back on the credit card and would make all the hard work and sacrifice of the last two years mean nothing. 

Second - The babysitting money will pay for our extras like the ones noted above and maybe leave us a little extra to save some months.

Third - My second job would finally be able to go towards an EF. 

I think it would be wise to keep going the way we are for the next year and build up some savings. Then I could give up the second job. I can't express how uncomfortable I would feel giving up any of our income right now. I also can't express how pissed off dh is about it. I really don't think he cares at this point whether we have debt or not. He feels like our life is on hold and wants it back right now this second, not in a year when we are better off financially.

To add to it all, he desperately wants another baby. It's not that I don't but it's complicated for us. If I could wake up pregnant tomorrow I would but that is just not my reality. We have very serious fertility issues and cannot conceive without IVF. The point financially is that IVF is a huge commitment of both time and money. Both of which we are seriously lacking right now. We would have to go into debt. I would have to give up both my jobs. And at the end of the day, it's very possible it won't work. Statistically, it's more likely not to work than for us to end up pregnant. 

I don't know what I'm asking. It's such an emotional issue. We both have a right to feel the way we do. It sucks to have to think about money and babies as an either/or proposition. It's been hard and we've had some tough times but dh and I do really love each other. I don't think either of us wants to see the other unhappy but our wants are in the opposite directions.

[laohaire]

Wow, that sounds hard.

What does your DH envision in terms of "letting down your hair" when you pay off the debt. (Major kudos, by the way, for doing all of that). Is there room for any compromise?

If you think he will be wanting to spend you all back into debt, that's a problem. Ask him if he wants to do this all over again. If he hated going 2 years tightening the belt, is he going to want to repeat it all? Is there any middle ground where he can go out to eat on occasion or something but not actually go back into debt?

With all those payments freed up, would you really not have some extra money? I am more like you, and I'd want to continue and go crazy adding to savings. But is there middle ground?

Have you read Dave Ramsey's Total Money Makeover? It has steps to financial freedom, and it doesn't end with debt repayment. But it DOES end, and he does not advocate frugal living forever. His target audience is one with a decent income, though, but the picture he paints is: get out of debt, fund your retirement, save for your children's college, and have a fully funded emergency fund. Then, party on! Pay cash for everything! Go on vacation! Buy a fancy car! Well, that won't be our reality (income too small) but my point is that he can be very motivating for people who aren't into denying themselves, because the point is to get to a place when you can spend, baby, spend. Maybe both of you reading it might help you figure out a plan. It doesn't have to be Dave's plan, but his is a good place to start from at least.

[laohaire]

Sorry, I didn't reply on the IVF because I don't feel qualified to even have an opinion on it. I can see it both ways. Going into crazy debt for a "maybe" is something to seriously consider. On the other hand, children are important. Adoption is expensive as well, I don't know how the costs compare though, and no doubt you've already considered it. Anyway, just didn't want to totally ignore that piece of the equation.

[chiefmir]

I just wanted to chime in about the IVF issue.  It is so expensive... I know that feeling.

Have you looked into any research studies at all?  I "know" (all online) of several women who got pg via IVF for free this way.  I believe the only requirements for their studies was that they be under 45 and have had fewer than 5 failed IVF cycles (though obviously the types of women each study needed would vary). 

I don't, obviously, know your IF history...but I would like to add my own experience.... for DD2 we did 18 months of ART, including 4 clomid cycles, 4 injectible cycles, 1 cancelled IVF cycle and one failed IVF.  When TTC#3, DH and I decided that we'd give ART a try, but wouldn't go IVF again... and this time- MUCH to our shock, our first injectible/IUI cycle worked!  Maybe if you and DH really do want to try for DC#2 you might want to consider a consult with your RE again-- just in case there are options for starting with less invasive and less expensive procedures.

good luck to you!

[Ellien C]

Can I address the taxes part? I see this a lot, people getting big refunds and they have CC debt. In your case you say that DH's salary would barely (or not) cover expenses regardless of the CC debt. Can you adjust your withholdings so you are getting LESS back on taxes and have more day-day money? Or do you think the big refund is an anomaly and not likely to be repeated?

[sunflower.mama]

I think people frequently suggest this, and while it may help some people, it's often the case (as it is for us) that if you have a bunch of mortgage interest and kids, you can get sizable returns with zero federal withholding.  The child tax credits of $1000 per child come to you even if your tax liabilty is $0, as do the child care tax credits.  I assume that the earned income tax credit works the same way although I don't have experience with it.

Originally Posted by Ellien C 

Can I address the taxes part? I see this a lot, people getting big refunds and they have CC debt. In your case you say that DH's salary would barely (or not) cover expenses regardless of the CC debt. Can you adjust your withholdings so you are getting LESS back on taxes and have more day-day money? Or do you think the big refund is an anomaly and not likely to be repeated?

[chely7425]

Yes to this.  Our taxable income is not a lot, and with 3 kids and me not working we have 0 tax liability but get a sizeable return every year.
 

Originally Posted by sunflower.mama 

I think people frequently suggest this, and while it may help some people, it's often the case (as it is for us) that if you have a bunch of mortgage interest and kids, you can get sizable returns with zero federal withholding.  The child tax credits of $1000 per child come to you even if your tax liabilty is $0, as do the child care tax credits.  I assume that the earned income tax credit works the same way although I don't have experience with it.

Originally Posted by Ellien C 

Can I address the taxes part? I see this a lot, people getting big refunds and they have CC debt. In your case you say that DH's salary would barely (or not) cover expenses regardless of the CC debt. Can you adjust your withholdings so you are getting LESS back on taxes and have more day-day money? Or do you think the big refund is an anomaly and not likely to be repeated?

 

[ilovemygirl]

Thanks for the replies ladies. 

The taxes are a lot more than usual and I don't expect that again. It's usually around 2-3k which comes to about 40-60 a week. I'm not saying that's nothing because it's a nice bit of money but it will hardly cover all the emergencies that come up and the extras. When I say his salary covers our basics, I mean our very basic basics. Like rent, electricity, food, insurance and medicine. It doesn't cover ANY charity, entertainment (other than our cable), clothing, gifts for us or for other people, gas to travel to visit friends, etc. So I guess technically, it doesn't really cover the basics because we are already feeling pretty deprived. I went through every little expense and we kept three things. Our pets, a membership to the children's museum and netflix. That's it. We already live as frugally as possible for us and his salary just doesn't stretch far enough to break even. 

So we really are having the battle of what kind of financial life do we want. Dh says he is comfortable always being in debt and never having savings. He says we've come this far living that way and we should just accept our fate and move on. I really don't want to live that way anymore. I don't want to be rich or have expensive things, I just want to live comfortably and have a little savings in case of emergencies. 

Then bring in the expense of doing IVF. There's no chance of anything else working (we've tried it all) and there's a big chance that IVF wouldn't even work. That's thousands and thousands of dollars that we just don't have. Both of my jobs are not with a business. There's no vacation or sick time. If I don't work I don't get paid and if I'm not completely reliable and there exactly when I should be I will not have a job anymore. There's no way I could do either of them with how time consuming and unpredictable fertility treatments are. So I would have to give them up and hope that I could find something again when the treatments were over. It's not easy for anyone to find work right now. I consider myself really fortunate to have the jobs I do and there's no guarantee they could be replaced easily when/if I wanted them back. To be honest, this economy scares me to death. I've already been part of downsizing and outsourcing and lay offs. There's less than nothing left in my field. I'm already working off jobs making a fraction of my old salary and yes, I'm afraid to give them up. 

I feel like I'm just trying to be logical. Even if we easily broke even every month, I don't think using credit cards as our only back up is a good plan. Dh doesn't seem to get that the credit card companies could close our accounts tomorrow and we would have nothing to fall back on. What would we do then when our car breaks down or our cat is sick? We do not have any family that could/would help us. Dh will be 40 this year. We aren't kids anymore. It's all on us to take care of ourselves and our dd. 

[GirlBoyGirl]

First of all, congrats on all of your hard work and everything you have accomplished so far!!! BIG KUDOS to you!!! You really took charge of your finances for the better of your family, way to go!

Regarding IVF, I'm sorry, that's hard. I've been there! We were given a less than 1% chance of getting pregnant without IVF so that is what we did (2 cycles) and got the twins. After them, we weren't preventing (because whats the point?) and surprise! We got pregnant! Not saying that will happen for you or that is normal, just wanted to share my story. Also, I had no idea there were research studies that would pay for your IVF but that is worth looking into- if you can find the time because I know with all the appointments it is hard ) alot of clinics have very early morning hours or late evening hours)

Regarding you quitting your job, I think you are just going to have to tell DH that you aren't willing to do it. You have to be firm and stand strong because you are doing this for your family. Its not like you are working so you can afford pedicures and lattes. Maybe you can look for an at home job instead if you think that would make him happy but a weekend only job like you have is pretty nice. WAH jobs might not offer that but you could look into it:

workplacelikehome.com
liveops.com
ratracerebellion.com

Good luck!

[VisionaryMom]

Could he bring in more money? If you've cut everything, and his income still won't pay the bills, then why doesn't he look for other employment, education, or something that would increase his earnings potential.

Is your plan to SAHM just while your child is a preschooler or forever? If it's just temporary, then I may be more willing to consider cutting back, but if the idea is that you'll always be at home, then there's no way I could be okay with living hand-to-mouth forever.  

[zebra15]

Can you find employment opposite hrs of DH with a company that provides you benefits: sick time, PTO, heath care etc?   To me it sounds like you guys need more income either way.  You doing childcare is great and you need that income but possibily joining a company would be better for you in the long run?  That job doesnt need to be 'in your field'  at this point it just needs to be a job!

I also think reading some FP books, dave ramsay, susie oreman,  read a variety of what is out there and pick from them.

[ilovemygirl]

Thanks for sharing your story GBG. I certainly would welcome a surprise pregnancy but I'm not holding out hope. We haven't prevented in the fourteen years we've been together and it hasn't happened yet. Since I was in my twenties when we started trying, it took years of natural methods, then pills, then injectibles, then IUI's before we finally did the IVF with ICSI. It turned out we both had fertility issues. Needless to say there's a lot of emotional back story here and it's part of why I'm reluctant to try again.

When I looked into research studies years ago, everything I found was for people with unexplained infertility or you could only have one specific problem. I would qualify and he wouldn't or he would qualify and I wouldn't. I guess it might be worth looking into again though ... maybe things have changed. 

I don't know what to say about dh making more money. I'd be very nervous about him changing careers right now. I know a lot of people who are perfectly qualified and experienced and can't get work. It seems pretty risky for a middle aged man to go off looking to enter a new field behind all those people while asking for a high salary and good medical insurance. It's a possibility that when our debt is gone and we have some money saved he could try to get his masters in hopes of a raise/promotion but that's years away still.

I appreciate all the advice and thoughts. I'm going to talk to dh and tell him I will keep working until we are fully debt free and have some savings. Hopefully in a year or so, I can give up one of the jobs and reconsider ttc then. I know it's the exact opposite of what he wants to hear but I just don't see this as something I can compromise on right now. Our needs have to go before our wants ... right?

[GirlBoyGirl]

Right!

Sounds like someone has to be the voice of reason here, so I hope he handles the news ok!

Also, a lot of clinics do shared risk plans, payment plans, etc. But I can understand why you don't want to tread back into those emotional waters.

Good luck, mama!