Is this what the Emergency Fund is for? - Mothering Forums

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Old 03-02-2010, 08:26 PM - Thread Starter
 
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DH is currently working in construction, but we are in the northeast, so his hours are very weather dependent. February was a brutal month. Between his boss being sick, the snow and rain and winter break (his boss gave everybody the week off - a blessing and a curse), dh only worked about two weeks (!).

As it is, even when he works FULL TIME, we are a little short each month. This month is a disaster. Do I put groceries and gasoline on the credit card? Borrow money from family? Or wipe out our emergency fund? We have A LOT of credit card debt, and had been working diligently to get rid of it (via the snowball), but since this turn of events (namely, dh getting laid off and having to take a job for $20/hr) all that has come to a screeching halt.

WWYD??
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Old 03-02-2010, 08:32 PM
 
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I wouldn't add to the debt. If you are short every month and you are in debt, something has to give. Either you have to find some way to get more income or cut costs. I would be crazy frugal about my grocery purchases, especially if they are coming out of the emergency fund.

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Old 03-04-2010, 10:41 AM
 
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Originally Posted by dachshundqueen View Post
I wouldn't add to the debt. If you are short every month and you are in debt, something has to give. Either you have to find some way to get more income or cut costs. I would be crazy frugal about my grocery purchases, especially if they are coming out of the emergency fund.

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I would use the money for your shortfall. Then figure out a way pronto to increase income or cut costs as PP suggested.
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Old 03-04-2010, 02:56 PM
 
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Originally Posted by cristina47454 View Post
DH is currently working in construction, but we are in the northeast, so his hours are very weather dependent. February was a brutal month. Between his boss being sick, the snow and rain and winter break (his boss gave everybody the week off - a blessing and a curse), dh only worked about two weeks (!).

As it is, even when he works FULL TIME, we are a little short each month. This month is a disaster. Do I put groceries and gasoline on the credit card? Borrow money from family? Or wipe out our emergency fund? We have A LOT of credit card debt, and had been working diligently to get rid of it (via the snowball), but since this turn of events (namely, dh getting laid off and having to take a job for $20/hr) all that has come to a screeching halt.

WWYD??
$20/hr is actually a lot of money. Where is it all going? A really expensive mortgage/rent payment? Expensive cars? $20/hr equals $800 a WEEK...man, that's a lot of money!

Do you have a budget? Maybe you could post your expenses (I'm much better at budgeting other people's money than my own ). There must be a way to live debt-free with that high of an income.

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Old 03-04-2010, 04:07 PM
 
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Originally Posted by waiting2bemommy View Post
$20/hr is actually a lot of money. Where is it all going? A really expensive mortgage/rent payment? Expensive cars? $20/hr equals $800 a WEEK...man, that's a lot of money!

Do you have a budget? Maybe you could post your expenses (I'm much better at budgeting other people's money than my own ). There must be a way to live debt-free with that high of an income.
Everything is relative. To you, the hourly wage seems high, but to the OP, it sounds like a major step down in income, and your $800/wk estimate doesn't take into account taxes coming off the top. My DH makes a good deal more than $20/hr when he's working, but right now he's unemployed and the work just isn't there. He might be out of work for months, so right now we'd jump at $20/hr if it meant not eating up our savings or adding to our debt, all the while knowing it was *just* $20/hr and that he could/used to make more. I can understand where the OP is coming from, since we're getting pretty close to a similar situation. I know from experience that it doesn't take expensive vehicles and a huge house payment to get there, esp. when a layoff is involved.


OP, first, s:
Second, yes, this is one of the situations that the emergency fund is for. The idea is to avoid going even further into debt when bad things happen. For the short term, you might need to tap into that fund, but the idea is to use as little as possible while you work out ways to cut expenses anywhere and everywhere and/or increase your income to cover the shortfall. Pay minimums on your debts for a month or two. Yes, it will take longer to finish your debt snowball, but the focus now should be on making sure you don't add to it by using credit to buy consumables, kwim?
Waiting2bmommy has a great suggestion, post your budget here if you can (and are willing) and you should get some great ideas on how to get through this without it wiping out all the progress you've made so far.

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Old 03-04-2010, 05:54 PM - Thread Starter
 
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Yes, we have a budget. I've learned a lot from this forum and we've implemented most everything. Things are bare bones around here. No cable, no eating out, no travel, no new clothes, we bundle trips so I only have to fill up once a week. Our cars are paid for. We are currently renting, so no home repairs. Small house but High COL - we pay $1275/mo. We keep the thermostat at 58 degrees. We are on MassHealth, so no health/dental insurance costs.

Our credit card minimums are our problem. Oh, and oil heat. At $20/hr IF dh works 40 hrs a week, we are still short $1000/mo. I am a SAHM, and am looking at going back to work. Previously, dh provided well for us, but this economy has dealt us a hard blow. Sigh.
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Old 03-04-2010, 06:55 PM
 
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Wow thats a tough question there. You already have incurred enough debt and you don't want to add to your debt either. Borrowing from family I wouldn't recommend that either, might cause dispute if your not able to pay them back at the agreed time. I guess you could use a little of your emergency fund until things get back on track and you can put back the funds in your emergency stash when things are better.

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Old 03-06-2010, 03:16 PM
 
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$20/hour in the Northeast is not a lot. Not when rent on a 2 br apartment can be $1000/month or more, electricity is $.19 per kW, oil for heating is $3.15/gallon, etc..

Plus, the OP said her husband only got 2 weeks of work in February - that's only $1600 for the month, pre-tax, assuming he worked 40 hours a week those two weeks.
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Old 03-06-2010, 07:16 PM
 
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I agree that COL makes a huge difference. $20/hour wouldn't take us very far either.

That said, even when your DH is working 40 hours a week, you're still $1000 short every month? It sounds like it's time to find another job. Either for you or your DH- but something's got to give.

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Old 03-06-2010, 07:35 PM - Thread Starter
 
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Just wanted to post an update...somehow, we made it this month. DH got paid for the first week in March in time for it to cover bills, I got some bday money, one of our investments paid out the annual disbursement...God's got crazy timing!

Next month will also be tight, but the money we are "short" will be made up from a reimbursement for materials (work we did on this house)

Yes, something has to give...dh is applying for jobs and I am gearing up to go back to work. It will be a huge transition for us, but a necessary one. We could have all our debt paid off in short order if I managed to get a FT job. What a load off our shoulders that would be!
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Old 03-06-2010, 07:41 PM
 
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It sounds like you are doing A LOT well. Your budget sounds crazy-tight, and thank heavens you were blessed with a little extra cash when you needed it.

Could you call your credit card companies and ask them to lower your min. payments? Or look into transferring your balances to a different card, maybe with no interest?

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