Saturday, February 4, 2012

Some History and Background

It looks like I am getting a few more readers to my little blog!  Thanks for joining!  I don't have a very long memory, so I pretty much don't remember what I posted last week and I rarely go back and look at what I posted (I'd rather be reading all your blogs) so thought maybe a little background info might be helpful. As anonymous as I can be, here's the scoop:

Dh and I have been married over 25 years, have 2 kids now 20 and 16.  I'm an accountant and Dh used to work self employed in the construction industry.  His being self employed was ALWAYS a struggle financially as he never made good decisions and really just wasn't too cut out to be self employed but he struggled along anyway because I don't think he knew any better.  Then he became ill and it was hard for him to work, but he struggled on as best he could, in pain every day and working when there was work (construction is seasonal around here).  The end of 2008 hit the economy and by spring of 2009, when work should be back in full swing there was NONE. The construction company he did most of his subcontract work for had laid off over 90 of their employees so they sure didn't need him!  By the end of summer he lost his business and of course the stress didn't help his illness. Without the business income there was no way to pay his business debts (equipment loans, line of credit and credit cards) on my salary - my salary was what we lived on.  He never incorporated his business (financial advice: always incorporate!) so we had to file personal bankruptcy (a very stressful part of our life that I am so glad is over). 

Most of the debt written off (except about $700) was all related to the business, so while we got out from under all the business debt, we were still basically in the same boat on our personal finances.  Little debt, other than our home and a home equity loan (which was taken in 2007 to keep his business afloat).  Of course, since we kept our home, we still are paying the $60,000 home equity loan.  Luckily (I guess) the month before we filed for bankruptcy the bank that held our HELOC loan offered new terms (they had been bought out by another bank earlier that year and were reorganizing their loans) much more favorable to our monthly budget.  Instead of interest only for 5 years and then the $60,000 due in 5 more years (which would have started this year) they offered interest only for 10 years and then monthly payments for 10 more years.  I took it and it got changed just before our bankruptcy was filed.  Otherwise right now I'd be looking at a huge monthly payment I don't know how we'd afford and we'd probably would've had to let our house go. But, getting this $60k paid off is really something I want to figure out how to do in less than 14 years, which is when our first mortgage will be paid off.

Dh hasn't worked since and we tried for disability but was denied saying he could work 2 hours per day, so not eligible.  Seriously, who could find a job to support their family on for 2 hours a day?  I work full time and have 2 small side jobs that I made an additional $800 a month or so on.  From the bankruptcy we were able to keep our meager assets, 3 older cars (one only worth about $500, that Ds was driving to school). Our house value plumeted and now instead of having $30-40k equity we are $50k underwater.  Some days I think we should just walk away from it and start over, but we've been here so long and we'd have to rent, which we don't want to do.

 My mom is very financially secure has has always been my "backup" when needed and I always pay her back, though she and my dad (passed away now) set aside money to pay for kids college (thank god!).  After bankruptcy she offered to finance buying me a new car (I commute alot and need something reliable) and I was going to spend about $18-20k on a new car, but we found a great deal on a 2011 car that had less than 5k miles on it for $12k, so we got that instead. It was practically like new. I'm making montly payments to my mom and LOVE LOVE LOVE my car :-)

Our only debt is the house, HELOC and my car loan with Mom.  Of course, we now have no credit card to rely on for emergencies so we have to be very careful, which is why I have been so focused on getting some savings built up.  I have one department store credit card, Macy's, that didn't have a balance and didn't get canceled (I had a JC Penneys card for 30 years, used it on occasion and was never late and hadn't had a balance on it for a year and they canceled me after bankruptcy).  I don't shop at Macy's much but have tried to use it every so often just to try and get my credit built up a little, if possible.  I'm debating whether to try getting one of those secured credit cards to help rebuild credit score, but at this point do not want to tie up what little savings I have.  And I really don't want good enough credit to get another regular credit card, I'd just use it and I don't want to charge anything.  Surprisingly enough, CreditKarma shows our credit scores at 689 and 672 - not as bad as I had imagined they would be.

Our home is very modest, 1700 sq ft manufactured home - and always falling apart!  I did finally save up enough money last year and we had it and the garage repainted, which did wonders for the look of the house and all of our state of minds.  We have a little acre of land and try to keep it looking nice, though dh would like to do some additional landscaping this spring/summer. 

My main struggle with our finances is to keep Dh from spending.  He has never managed money well and never saved a dime in his life.  I am the one who has to take care of it ALL and finally have resorted to not telling him of the $1500 EF I have built up and will probably tell him our income tax return is half what it really is so I can put the rest into more savings.  He has no concept of saving money and with retirement 20 years away, I can't imagine how we will get by.  Right now my 401k/profit sharing is only at a little over $20k and I had to stop contributing in 2009.  I was so hoping to get a raise last month so I could restart contributions but no raises were given to those who got one last year :-(  At least my company is contributing 3.4% of my annual salary each year, so it is going up a little each year.

In some ways, things have calmed done a lot in our lives now that dh isn't working and doesn't have a business.  We can't do as much as we used to, but we also are not going into more debt every year and it's a much simpler life, which I am finding to my liking.  So, my blog is a record of our journey in this chapter of our lives.


  1. Thank you so much for the update! It's nice to know the background, so I can understand where you are coming from when you post!

    Glad things have calmed down a bit. I'm sure it's difficult for you, and I think you are smart to put some money aside. (After all, you are doing it for your husband too! He'll be glad in the end!)

  2. great background!

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  3. Thanks for sharing! I just went through bankruptcy and am facing some of the same credit building issues as you.