I have a client. She's 25, three kids, no job, no child support, on public assistance, living with mom. She's trying to get her own apartment through subsidized housing. She wants to get a job but I can't imagine what she'll end up with because she doesn't have any solid employment history. At least landing a job that will be able to support herself and her three children. She's trying to finish her degree but approx $25k of her $27k in student loans is in collections and she will need to establish a payment arrangement and be on time for at least 9 months before she can get them deferred and finish school. This on top of trying to hold down a job to cover basic necessities.

I know what kind of plan she needs outlined in order to move forward and she does too but she isn't motivated to do anything. At this time she's content with being on welfare and living the life that an assistance check can provide. Despite the fact she has 36 months and then welfare will cut her off for life.

I'm at a total loss. I've never met someone so obstinate. She wants to go back to school but doesn't want to make any of the changes I've suggested to get her on that track. The steps I suggested she follow are:
1. Find Employment
2. Come back for a budget review so we can set up a payment arrangement for your student loans
3. Talk with a bankruptcy attorney if your employment doesn't leave you with enough income to sustain repayments to the remaining $25,000 in debt (which includes two buy here pay here cars that have been repossessed, various credit cards, and a $1200 utility bill.)

I feel like she's wasted my time…her time. I mean…Why did she come here? Was it that someone finally pulled the covers off and exposed the truth of her situation and now she doesn't want to face it?

I don't know. Just thought I'd share.

I found out that I’m owed $332 from a bank that I have never done business with however I talked with a lady over the phone and she verified my identity and said that it was owed to me so it’s rightfully mine. Great!!! I was going to treat myself to a new workout program to do at home. I figured for once in a long time I’ll put my health and well being first. Then I convicted myself since I don’t do the exercise programs I already have. Therefore the $332 is going straight to the credit cards. I’ve decided to split it between my Macy’s and Citibank card since those are the highest in interest. Hopefully this will square away those balances in addition to my regular payments I was going to make. I am going to allocate the other funds toward odds and ends in my debt. Hopefully I will be able to pay at least one thing in full besides the two CC’s.

My final bill for both the hotel and car rental came to $179 and $203.31 respectively. I also charged $20 for baggage fees back home. Two weeks ago I made my first installment of $165 which brings my BOA CC balance to $2,292.47. That bill won’t be due again until October so I will make another installment of $165 with my first pay in September. I would like to do it with tomorrow’s check but I will need to save it for rent as I will be paying that again starting September 1st. I withdrew $600 from one of my savings accounts to pay some bills before my next paycheck just to get them out of the way. I like paying bills at least two weeks before the due date. It usually pushes the next time their due to the next two months that way I can use the following month for extra payments to my CC’s or hold that money for when my utilities come due again.

I’ve got some things going on in my budget that I was hoping I could pay an additional $1200 toward my debt. I decided to boost my savings and split the $1200 in half to make a $600 installment to emergency savings and $600 in additional debt payments for September. I am going to concentrate on boosting my savings and am shooting for $15k by year’s end. If I do so I will celebrate by committing my ENTIRE tax return toward debt. I hope you’ll hold me to it.

I’ve run into quite a few clients who are in a never ending cycle of poverty all because they can’t get a decent paying job due to past criminal histories. Part of my job as a counselor is to help my clients to create a budget and stick to it. How in the world do you make a budget without an income? Most of my time is going over the necessities of their budget so that they know the least amount of money they would need to bring home to make ends meet.

I’ve met countless women who are married to men that can’t get a job and if they do get one it’s dead end. They end up having to carry the family on their income because their husbands simply can’t. I’m not judging people with criminal histories and felonies but it does send a message to me and my personal life that it may not be a good idea to end up in a relationship with someone like that who hasn’t already made something of themselves.

I have a client who is behind on her rent due to her food stamps getting cut off. They’ve just moved here so she hasn’t become acclimated to the area food banks to get by until her stamps are restored. She lost the stamps due to missing a re-certification. I know, her fault. She tells me how she just started a new job but it’s only part time. I already figured that her husband was working so surely whatever she brings in is going to help out with their budget some sort of way. I then find out that her part time job is the only income source they’ll have. Her husband has applied but consistently gets turned down due to his felony. I usually don’t probe about the details of a client’s criminal history as I didn’t here.

Is it her fault for marrying a man with a felonious past? I know love is blind but clearly you would have to consider the possibility of a low income job future when you choose to marry someone and have children with them. I’m not saying I would NEVER do such a thing but I’ve seen too many members of the working poor or the near homeless and unemployed that have ties to criminal histories that may likely keep them there for the rest of their lives should they choose to stay in that situation.

We had a bad experience with our housekeeping here at the hotel. My roommate complained about the horrible service and we received a free night as well as a reimbursement of our parking. This will change the budget as we get the final bill tomorrow and split it once again evenly. I can now make a $91 payment on Macy’s since that was my budget for parking here at the hotel.

I don’t know why but my car insurance went down by more than $11 a month. To celebrate I will be paying an extra $15 on my BOA card. I also have been reviewing my bank statements and I need to cancel a credit watch subscription since it has already served its purpose. I needed to monitor my credit on a constant basis since I was considering co-signing for a car. I am no longer needing to do that since I am not co-signing after all. That was $14.95 a month so I will transfer that $15 to Capital One. I always get nervous when I know my credit is going to be reviewed. Those bills came due and I went online to schedule both payments to come out this week. I got paid Friday but I don’t get direct deposit so I will need to wait for my check to clear before I can pay my credit cards.

I also got a chance to review how some of my CC bills have decreased since last month. BOA went from 2326.36 to $2055.16. A decrease of $271.20 Capital One balance went from $1215.82 to $1072.44 a decrease of $143.38. The BOA balance decrease will be short lived. Between the credit hold for the rental car and the hotel the bill reads a current balance of more than $3000. However I won’t know until later this week what those balances truly are. I’ve scheduled this month to make random payments on that card when I can. Stay tuned for my final financial outcome on my vacation.

I’ve been really thinking about my savings in a new way recently. Before, I just put about $600 per month away in addition to two paychecks and my tax returns so far this year. Now I’ve evaluated my total savings to see where I really should be putting my money. It gives me new focus and a defined commitment of how I should be saving, why I’m saving and how much to commit each month.

Summary of Savings

EF $9046.13
Car (new) $300.00
Vacation $2283.38
HSA $1035.95

I will be able to commit just one more installment of $300 to my emergency fund next month. This is due to a furnace I bought last year so my landlord gave me a year’s worth of rent free to pay back the interest I lost but it was a better profit than if it had stayed in there so I’m not complaining. I live with a roommate so my half of the rent is $250. Then it will be $50 a month to the EF for the rest of the year until my debt is paid. I get an “extra” paycheck in October since I budget myself on two biweekly paychecks a month and that month will be three. The other 50% will go on my credit cards.

I’ve decided to take the car money that I’ve been putting away without thinking and commit to applying it only to my car replacement/repair fund. I paid off this car last year and ever since I’ve been sticking the $300 away without a thought as to its true purpose. I added it to my emergency fund but I’m too lazy to do the true math to separate it out. I had some car repairs that totaled approximately $1k which threw off what I had really saved to the penny including interest. Instead I’ll start from square one.

My vacation fund is for my trip to Orlando next week. I really hope I don’t have to use this fund. So far I’ve been paying for it out of take home pay. Whatever I’m able to spare will be left there for now. I am planning a surprise trip to Georgia to surprise my pregnant cousin on her baby shower. The ticket is going to be cheap so I’m expecting it to come out of take home pay and I won’t have to pay for a hotel or food since I can stay with my family. I’ll be adding to it monthly for next year’s trips but if it gets out of hand I’ll transfer any excess to the EF.

I have a high deductible health plan for now. I don’t know if that’s going to change since my employer may be looking into another health care plan. I’m currently committing $50 per month since I’m now using it but I plan to contribute at least $100 a month when my debt is paid. My goal is to get this fund to $1500 just to avoid the $3.95 monthly maintenance fee.

I also save my spare dollars and change when I get a twenty out of the ATM. I rarely carry cash on me and when I do I tend to spend it just because it’s there. As soon as I can I try to deposit the loose money into an old jug I’ve re-purposed as my spare cash and change bank. I try to empty it out a few times a year to add to my debt so for now I won’t count this money toward savings as long as it’s going for debt repayment.

Stay tuned for my debt payoff strategy!

I have this client with no savings, retirement; she’s a renter, no assets. Her total monthly income consists of $1201 in disability and $4, yes, four dollars in food stamps for a family of three. I’m having a major problem with one of her expenses, a $250 monthly cell phone bill. She’s $1500 behind in her rent of which she only has to pay approx $150 per month. Her excuse for not paying her rent is that she didn’t know where to send her payment to. She had it saved but “something came up” and she didn’t have the $1800 she owed to her landlord. To her credit the property manager had so much on his plate he forgot he rented it to her but still…not one phone call to them to ask where to send the payment? You did sign a lease didn’t you? She’s currently paying more than $100 over her regular rent payment to pay it off yet I can’t help but to tell her about reducing her cell phone by I don’t know…$200 maybe? Then she could pay off the remaining balance of her past due rent in five months instead of fifteen and take the $300 and start saving toward the $2000 she’s allowed to have in savings without interrupting her disability payments in case something else comes up.

It gets worse. She proceeds to tell me how she can’t cut the cell phone because it’s a multi family plan between her, her daughter and granddaughter. “Ok, are DD and DGD paying for their share of the bill?” I asked. “No” she says. DGD is living with her along with her own infant-aged child without a job. Although, she is making a valiant effort to apply for welfare. Not because she really needs it but because that’s what she’d rather do instead of getting a job. DD apparently has a job but doesn’t pay her share of the bill either. I didn’t care to ask what her problem was.

Granny is $98 in the hole every month (which explains why after looking at her file I see she had to get “emergency help” with her utilities.) I proceed to go through her budget to see where she can cut back $108 since she tells me that she’d like to start saving $10 a month. I noticed that she’s already cut her cable entirely and she tells me about wanting to make the necessary budget constraints so she can have the cable cut back on. It’s $168 a month. No worries though…that’s the bundle price.

I have scheduled her for a follow up but I’m afraid it will all be in vain. She doesn’t see her spending the way I do. I don’t think I pay $3000 in three years on a cell phone let alone one. Then there’s the cable and she NEEDS the cable. Despite the fact that she’s one more late rent payment away from eviction. This of course leaving her with no place to hook up the cable.

Now’s my turn to tell you about my finances.
Savings
Savings #1 $2,283.38
Savings #2 $5,051.12
Savings#3 $1,478.32
Savings#4 $2,501.69
HSA $1,035.95

Total $12,350.46

Debt

Capital 1 CC $1065.82 @ 3.99% Fixed for life of balance
BOA CC $2,175.36 @12.74% adjustable
Citi CC $183.73 @29.99% Adj. (but who am I kidding)
Macy’s $292.69 @23.99 Adj.
Limited $97.12 @24.99 Adj
Medical Bills $2354.00 @0%
Old Cell’s $254.00 @0%

Total $6,432.72

Hopefully I’ll be able to update these monthly. I’ve been aiming for reducing my debt while increasing my savings. I paid off my car last year and although I have been putting that money away in savings for my car repair/replacement fund every month since September 2010, I haven’t been monitoring it closely. From now I’ll just make it my part of my emergency fund and starting with today’s paycheck I will commit my first $300 monthly installment. I could back track but I’m too lazy to do the math since I just spent nearly $1000 to have it fixed last month.

Some might ask why I just don’t take my savings and pay off my debt. I wish it were that simple. I work for a non-profit and although I’ve never missed a paycheck, in this environment sometimes you get paid and sometimes you don’t. I once had to wait three months and got paid over $5000 in back payroll while waiting for a huge invoice to come in. It hasn’t been that bad in a long time (thank You Jesus) but I think you can understand now.

The four savings accounts are two online only accounts and two accounts linked to my two checking accounts. I’m working on building these balances currently at $1,478.32 and $2,501.69 to $2500 a piece to avoid fees on the checking accounts. Before my banks started charging fees I barely kept $500 in them. Just some quick money in case of a tiny emergency. Like my version of a “pay day loan” to tide me over till I got paid and yes, I did pay myself a $10 penalty for lost interest for doing so despite the fact that I’m earning less than $5 in interest on each account right now. I’m also working on building my HSA to $1500 to avoid the $3.95 monthly fee.

So there you have it! Everything out there on the dance floor…including my heart for it is in this as well. I look forward to chronicling my progress.