Better Mom Reboot

Ok, so it has been over a year and I have been completely neglecting this blog.  As would be expected, a ton of stuff has happened this year. I started going back to school, and oh, yeah, we bought a house!

Last summer, a friend clued us in to a 0% down loan program for homes in rural areas, run by the USDA. There is a small community in our area that qualifies, so we thought we would go ahead and look at what was available. After looking at about 7 houses, we decided to go see where we stood in terms of actually getting a mortgage. We filled out some paperwork, and waited to hear how much we would need to lower our debt to income ratio in order to get a loan. To our shock and amazement, we discovered that we qualified for a loan much higher than we were planning right now! We wouldn’t even have to stick to the rural area, we could basically buy any home we wanted. When we left our lender’s office, I cried because I was so happy that our hard work was finally paying off!

 Armed with monthly payment calculations for a few different loan amounts, we found a price we could afford comfortably, and a price we were willing to go up to if we found something absolutely spectacular.  Over the course of the next 6 months we looked at lots of houses and gradually narrowed down our neighborhood options, as well as home features we wanted.

We suffered a few disappointments. We found a house we loved that was in the right neighborhood and had an acre lot, but it turned out the seller had already accepted an offer. It looked like the buyer was going to back out, so we were poised and ready to submit our offer, but the buyer followed through and we had to keep looking. We found another great house that had all of the features we wanted and a big back yard. As a bonus, it also had new carpet and paint. We put in an offer, but the listing agent sat on it instead of presenting it to the bank, and in the meantime, the bank decided to auction it instead. The house sold at auction for $20,000 less than we had offered. Frustrating.

Finally, we found a short sale that was well within our budget and had most of the features we wanted. It was in a great location, so we offered. The home owner accepted our offer within 24 hours, so then we just had to wait for bank approval. So we waited. Aaannnd we waited, and we waited some more. 7 months later, the bank approved it and we went into escrow. In less than 30 days, escrow closed and we were home owners. There were some issues with getting possession of the house, but after a few very stressful days and some extra labor to remove the previous occupant’s garbage (literally, he had cancelled his trash service and had been piling bags of trash in the garage for MONTHS. It was nasty) it all worked out OK, thank goodness.

Our new home.

Packing and moving was a huge task. I do not have any good tips on moving. We are terrible at it. Our move was totally disorganized and it took almost a week to complete. Now we are in our new home, and are trying to trudge through the unpacking process. It is going slowly (and I mean really slowly,) but surely.  In the process of moving, and getting the house functional, we also used up our savings and charged back up some of our debt. Now we have the challenge of unpacking, doing some minor home repair and renovations, and decorating our new place on a very tight budget so that we can get that debt paid down again. We are basically starting all over again, so I am trying to think of it as a fun creative challenge to come up with more ways to save. That’s fun, right? RIGHT??

Is Living On One Income Possible?

Being a Stay at Home Mom is an interesting endeavor.  I have gotten praise for doing “the hardest job in the world” and ridicule for being “just a mom.”  In reality, neither of those characterizations is fair.  Anybody who classifies running a house and raising a child as being “just a mom” or “not a real job” has clearly never tried it. In my experience, odds are they are also a jerk, so this type of comment tends to put one on my People To Avoid list. On the other hand, I am certain that there are quite a few jobs that are harder than staying at home to raise my own offspring. 

The choice to stay at home is a very personal one with a lot of factors, and every parent has to make that choice for themselves. I can only speak on my own choices. I never really had a huge amount of career ambition, but I always wanted a family, and I didn’t see the point in paying somebody else to raise my children. I am sure that stay at home parenting is not the right choice for everybody, and that’s fine.

What I do want to address is the myth that you have to have two incomes to raise a family these days. Now, I don’t mean that EVERYONE can get by on one income, or that even if you can, that you should. My point is that in a lot of cases, having one parent stay home with the kids is an option, if you want it.

When people hear that I stay at home, a common question is, “Wow, what does your husband do that allows you to be so lucky?” When they hear that my husband is a teacher, people are always surprised that we can get by on such a “meager income.” His paychecks are $3800 a month after deductions (not really meager at all.) We pay $1600 a month toward debt payments. So, we actually live on $2200 a month. I have a friend who, until a recent job promotion, was getting by on significantly less than our $2200 a month. We have enough money to pay the utilities, rent (which is admittedly low) and put food on the table. We even have enough to have an occasional night out. What we can’t afford is to go out of town every weekend, go out to eat every night, or buy new décor every few months. I often think about what we could do with that $1600 a month, if we hadn’t racked up all of this stupid debt, but if we can stay on track, we will be able to answer that question in a year or two!

Of course, if you have debt, it will add to the amount of money you need to make ends meet every month, but even with debt, you might be better off with one parent home. We considered having me go back to work to help pay off our debt, but for our family, that would almost cost us money. I have been out of the work force for over a decade, and when I worked I did serving and retail jobs, which don’t pay a lot. Presuming I could even find a job, I would likely get minimum wage. If I worked full time, we would have to pay for child care, if I worked nights, we would save on child care, but I would be tired (and crabby) and wouldn’t have as much time to do a lot of the money saving things I have been doing. For my family, the money we save by cooking at home, making our bread and cleaning supplies and other things is more beneficial than the small paycheck I would get if I had a “real job.”

In order for me to stay home with the kids, we have sacrificed a lot of things that many families consider important, like cable TV. We don’t have the latest gadgets or electronics and we don’t go on a lot of vacations. We decided that these things were less important than having me home with the kids. There is no magic solution that allows one parent to stay home and still allows for all of the luxuries (unless, the other parent has a very high paying job.) Choices will have to be made, and in most cases living on one income will involve sacrifices. If having a parent at home is something you desire, it is worth really crunching the numbers, seeing what you could live without, and then deciding if those sacrifices are worth it for your family.

It Is Actually Happening!

We get paid on the last business day of each month. Getting a paycheck only once a month was tough, at first, because if money runs low, there is no more coming in a couple of weeks later. On the other hand, it makes budgeting a lot easier, and we don’t have to juggle which paycheck will cover which bills. During the first week of each month, I update Quicken for all of our various accounts. This month I was updating balances in our debt reduction plan and I looked back to this time last year.

We spent a lot of time in the last year feeling frustrated because it seemed like the balances never went down. Well, I am happy to report that despite that frustration, we have eliminated $12,000 in debt in the last year! I believe the true total of what we paid off is actually $19,600 because we had financed a few things that were not included in last year’s totals. Some of what we financed was what we consider necessary, like vet bills, some was justifiable, like my stand mixer that allows me to make all of our bread, and some of it was just frivolous, like tickets to a show.

So, despite a significant amount of slip ups in our plan, we have lowered our total debt by a very large chunk in just one year! It can actually be done, even on one income, even with four kids. If you are trying to pay off debt, don’t get discouraged if your balances don’t seem to be going down. If you make a mistake and purchase something you shouldn’t, don’t give up. It really can be done, and you don’t have to be perfect, or live Little House on the Prairie style to do it.

Happy Mother's Day!

While I fully acknowledge that Mother’s Day is essentially a contrived Hallmark holiday, and that good mothers should receive thanks and appreciation every day, I still love Mother’s Day morning.

This morning I awoke to the kids doing their Sunday chores early so that the rest of the day would be free to do whatever I wanted. Seriously, the chore charts are really helping, I highly recommend them! Mike went and got donuts (at my request, he wasn’t being lazy) and helped keep the kids focused on their jobs. At breakfast, I was showered with the wonderful things the kids made for me at school. Actually, M gave me her gift the second she got off of the bus on Friday, but she re-presented them this morning. 

 

Mom's Day loot!

Pot decoration from my oldest

Mike went out to trim the hedges and mow the lawn and O brought me some of the clippings as a flower bouquet, which you can see in the vase with M’s hand print flowers.

As an added bonus, I looked at the garden to find that our artichokes are coming in! 

Check out the free and all natural pest control!

Later, I will be going to my mom’s for a bit. Her gift this year is that I am finally transferring all of the kids’ and grand kids’ height marks from the hallway at my house (my childhood home) to her new house.

I hope all of the great moms are having a good day, and that your kids give you one day of NOT reminding you why some animals eat their young.

Shocking May Challenge Update!

Yesterday was the first day of the kids' new responsibilities. We kept our expectations pretty low because the kids had a sitter and we weren't home most of the day to supervise. Last week I talked to the kids about needing their help around the house, and let them know about the new chore charts. Before we left on Sunday morning, we reminded them that they had chores to do and we expected them to by the time we got home. If the chores didn't get done, they would have to finish them in the evening, and there would be no TV for that child the next day. When we got home, all of the chores were done! Since we weren't there to show M how to empty all the trash cans, N did it for her (it used to be his job) and then had M and O help him clean the living room. That's right, my seven year old son did an extra chore to make sure it got done.

I have been a mom long enough to know that this success is in no way a guarantee that next week will go so smoothly, but it is nice to know that they can actually do it. Now, if they struggle one week I don't have to question whether they are capable of doing the chores I assigned. It gives me hope!

May Challenge-Getting the kids to help!

So, April’s challenges didn’t go so well. I pretty much failed at all of them. I did mostly keep up with my original March goals, but even that doesn’t feel like an accomplishment. It just seems like no matter what I do, it doesn’t last long. I don’t want to get too far into pity party mode here, but there are literally times when I clean a room and then leave it for a minute, and when I come back, there is a whole new mess. It just feels so futile, like no matter what I do, it won’t make a difference. It makes me want to just give up, I mean, what’s the point of just treading water all of the time?

Then I realize that giving up certainly isn’t going to solve anything, but if my family isn’t helping, there is NO way I am ever going to be able to get the house in order. Getting the kids on board is not going to be easy. They have bad habits too, and changing their habits is going to take a lot of effort, both from the kids and from my husband and I. This is my May challenge, to get the kids to pull their weight.

A friend of mine made a chore chart for her three kids, and has had a lot of success with that. She has broken the house into three areas, and her kids rotate through the jobs, so that they aren’t doing the same job every day. If one of the kids doesn’t do their chore one day, the next day they have to do the previous day’s chore and the current day’s chore, which means one of their siblings doesn’t have to do a chore that day.

Initially, I thought I could use her system with a few minor adjustments. It became obvious pretty quickly that her chart, while great for her kids ages 12, 11, and 9, would not work for my kids ages 10, 7, 6, and 3. I need to assign specific chores to each child based on age and ability.  What I could borrow from her, however, was the idea that failure to complete chores would result in clear, consistent consequences. 

I have made 3 checklists for the kids:

The Morning/Bedtime list for the tasks they have to do to get ready for school and get ready for bed.

 The After School list has their daily chores and tasks.

 The Sunday list has their bigger once a week chores, including step by step lists for each of those chores.

The lists are color coded so the kids can identify their own list easily, also because I am really anal retentive about things that don’t matter.I printed them out and put each one in a sheet protector so that they can use a china marker to check off the list each day, and then it can be wiped off and used again. There is an extra copy of each kids' Sunday chores in their room, so that they can see what they need to do without fighting over the list.

The kids’ role in this challenge is, of course to do the items on their lists. My (and my husband’s) role is to remind them to do their chores, as many times as necessary, without yelling, and to establish a set routine to keep things consistent. I, of course, have to remember that even though it might be quicker, easier, and done better if I do it myself, they have to learn how to help out around the house. This will be a particularly tricky challenge, because I have  enough trouble motivating myself, and now I have to motivate 4 other people, BUT, if I can succeed the reward will be great.

Long Term Goals

The whole reason we started working on getting out of debt was because we really want to be able to own a home. When we first got married, house prices were pretty low, but my husband’s job was not very secure. He was teaching, but he was on an emergency credential which meant that he was almost guaranteed to be laid off at the end of every school year. We didn’t want to commit to a mortgage when we didn’t know what our income would be like in a year or so. Once he was finally fully credentialed, we didn’t even consider trying to buy, because the house prices in our area were so ridiculously over inflated. We were starting to feel like we would never be home owners. Fortunately for us (but unfortunately for many recent home buyers,) the housing bubble burst and prices started coming down. Unfortunately, home ownership had seemed so out of reach for so long, we had not been preparing for it. We had too much debt and no savings. The down side for us of the bubble bursting is that home loans are much harder to come by now. Your credit has to be good, not just OK, and there is practically no such thing as 100% financing anymore. I knew what we had to do, we just hadn’t actually been doing it. When we got serious about getting out of debt, I started this blog.

It was really frustrating at first. We were paying well over the minimum payment on our highest rate debt, and paying the minimum or just a little over the minimum on everything else. The balances never seemed to go down. When we would make some headway, the car would break down or some other expense would set us back. We were still relying on our credit cards too often. On top of that, our debt reduction plan included a program to pay off student loans for teachers who work in low income schools. If we got the loan paid down to $17,500, the program would pay off the rest, once my husband finished his 5^th year teaching at a qualifying school. This year is my husband’s 7^th at his current school, and his 5^th as a fully credentialed teacher at that school, so come June, the rest of his student loan would be paid off. Or so we thought. When Mike applied for forbearance on his remaining loan so that we could apply that payment elsewhere while we waited for his anniversary date to roll around, we were told that he did not qualify for the program because his first student loan was issued 6 days before the window for this program began. Six stupid days. In the three years that we had been communicating with them while we paid his debt down to below the $17,500 cut off, no one at this program had ever bothered to mention that we didn’t qualify. We had been counting on that debt to essentially eliminate itself, and now we would be paying it off ourselves. It was a big blow to our morale.

Things got a bit better when I checked in on a Gifttrust I had. We decided to cash it out, and it gave us almost $3000 extra. Instead of using the money to buy things we wanted, we set some aside to get our van fixed because it was having some issues, put $1000 into our savings account so that future unexpected expenses wouldn’t have to be charged, and sent $1200 to our highest rate card.  Having that emergency fund really, really helps. Now I know that we can get the car fixed or whatever without making our debt situation worse.

We just got done filing our taxes and we are expecting a nice refund.  Even before the return was filed, we had already virtually spent pretty much all of it. We will replenish our emergency fund, and but an extra $500 in it, to make it a total of $1500. Some of it will be used for Mike to be able to attend his sister’s wedding in Texas. A large chunk of it will be used to pay off a credit card. A couple of hundred dollars will be set aside for me to attend a Women’s retreat in October. If there is anything left after that, it will be applied to the debt as well. After we figured all of that out, I took a fresh look at our debt reduction plan. If we are able to stay on track, we will be completely free of credit card debt by October. That still leaves us with Mike’s student loan, and another loan that is the result of a previous attempt at debt consolidation, but all of the really bad, higher interest, and rechargeable stuff will be gone.

Originally, our plan was to completely pay off all of the debt, and then start saving for a down payment, and THEN buy a house. After our car got broken into twice in 2 months, we realized we have to get out of this neighborhood as soon as we can. It was once a great neighborhood, but has been steadily declining for years. Now, sirens and the sounds of the police helicopter are normal, and we need to get out before it gets much worse.  Using a bit of online research, I found that even with those last two debts, we will be in a pretty good position to get a home loan once the credit cards are paid. That is, if we can come up with a down payment. In order to speed up our timeline, we have decided that in October, when the credit cards are paid off, instead of applying that payment to the next debt, we are going to put it into savings for a down payment. We will continue to pay the minimum payments (or slightly more) on the remaining two debts, but we won’t be paying extra until we have accumulated a good down payment. Our tax refund for next year (if we receive one) will also go towards a down payment. If we are able to stay on track, we should hopefully be ready to start buying a house in a year. Our goal is to be moving by early summer 2012.