The Low-Income Life

Update to My Setback

2011-10-28T06:00:00.001-05:00

After I fixed problem number one with my car things ran smoothly. Now, my dash display is showing that my gas cap is loose again, which went away when I fixed the fuel filter, and my service engine light is back on. On top is this, the violent shake in the front is not cured, however it's still not as bad as it was. Lucky for me I will be fixing this at the beginning of next week as I get paid Friday.

I'm supposed to actually receive some child support money from my son's mother(a whole other story) by the end of the month as well, an entire 250 dollars. This is believe will go to fix the other problem with my car since it's "new" money, then it's on to Christmas shopping. My youngest daughters birthday is 7 days before Christmas, so we are blessed with a little extra shopping, and she is blessed with a couple extra presents.

On a good note, I found out that my job offers a 401(K) in place of the forced retirement. I will be looking into this soon as well, because it seems with my current retirement plan I'm not allowed to play with it any as far as picking investments, and I can't roll my old 401(K) over into it according to the people that run it. Another good note, I may be finally going to day shift! We run 3 12 hr shifts and a 6hr shift. I work 6pm to 6am on those 12hr's, and it is not fun. It'll be nice to be home with my family at night. I'll be off Thursday, Friday, and Saturday as well, which is another bonus. I see a weekend getaway in my future.

New Account

2011-10-26T16:28:00.000-05:00

I've opened up a new online checking account through INGDirect. I already had my savings there, plus an old 401(k). I'm still going to be using for now my current brick and mortar bank, but those days are coming to a close in the future. I have everything automatically withdrawn from my old account, so I'll slowly switch everything over, probably after taxes come in.

My current brick and mortar bank charges a $8.00 a month fee. The fee was originally $10 but they lower it $2 for setting up automatic deposit of your payroll. This fee is supposed to go away after a year. Also, the past 2 months, they've been charging me $5.95 to use their bill pay service. This is something I do not use nor ever signed up for. Apparently this is a free service if I pay 3 bills a month, and I was magically signed up for it without my knowledge.

I made a phone call on the 17th to find out why I was being charged this fee, and to see about getting that $8 fee taken away from my account. Well, since I overdrew my account by $4.00 and my payroll hit the very next day back in January, I'm not eligible to have a free checking account. But they did tell me they will be crediting my account $5.95 for 3 months (next month will be on there too because its a month behind) and unsubscribing me from billpay. Well it's been almost 10 days and I've not had my account credited anything. I'll be calling tomorrow to check on this. I'm simplistic I guess. That's why I want everything automatically withdrawn and I opened up the checking account where I have my savings and that 401(k). Makes it easy for me.

Eating Out

2011-10-21T13:54:00.000-05:00

Eating Out. Seems like this is the new American Dream. I know me and my family love to go out to eat. And I've noticed that we are beginning to do this more and more. I work nights and she works 2nd shift, so we see each other a few minutes in passing and we usually have 1 day off together. I think that's where it comes from. I hate cooking and can't cook a lot so that doesn't help much when I'm home with the kids, however, I'm more likely to cook than she is.

What really stuck with me and inspired this post is the price of eating out. I'm not talking about a sit down, be waited on, family restaurant, I'm talking about McDonald's and other fast food places. If the entire family is eating, we can usually expect to pay about $22.00 at McDonald's. That's to high! Not when I can pay 4-6 dollars for a frozen pizza and feed the family, or cook a good home meal and still only be using about 7-8 dollars.

This is something me and my family definitely have to work on. We could definitely have a lot more money to spend on things that we would rather do. October is an especially bad month for us with eating out, and it has been for the last 6 years. Why? McDonalds has Monopoly going on! It's like crack.

Setback!

2011-10-19T09:14:00.002-05:00

If I would have started preparing sooner then I wouldnt be in the predicament that im in. I knew when I got paid that I was going to have a small amount of work done to my car. Replace a fuel filter. I masked the mechanic to look at some other issues with my car as well and see whats going on and to give me prices. Well, my 35 dollar out the door fuel filter turned into 136 dollars because my brakes in the front were almost gone, and the rear was getting there. While we were investigating further, we concluded i needed a new wheel hub and not a wheel bearing like i originally thought (money saved) and a transmission mount. Ones $100 and the other $111. So my next two checks will be replacing these things instead of putting money in the emergency fund. These types of things is what the emergency fund is for, and makes me wonder if I should be putting back a little more than a $1000 before i start on rebuilding my credit.

On the bright side I no longer smell gas after driving for a while (my fuel filter was leaking and had a lot of metallic crap in it, he kept it to show to me), my gas mileage has improved, and im not getting a violent vibration in the front like i was getting. The vibration is what made me think wheel bearing in the first place but replacing the brake pads solved the problem, yet i wouldnt be applying the brakes when i felt it. I dont know, cars are weird i guess, and im far from being a mechanic. Hopefully next time I'll be prepared for this.

Making Things Easy

2011-10-18T06:00:00.001-05:00

I've found through numerous trial and error different things that do/don't work for me as far as making things simple financially for me. Some people write down every single penny of everything they spend. This is the LAST thing I want to be a part of. It comes off to me as being to obsessive, like there is no freedom in spending the money I work hard to earn. That's why I budget the way I do, or don't, whatever one can call what I do!

I mentioned in a previous post that everything over what I have to save each paycheck for bills is pulled out of my bank. What do I do with it? Whatever I please! If I feel like gaining some weight this period, then I'm going to McDonald's a couple times! However, this cash in hand is my gas and haircut money(I religiously get my haircut every time I get paid, $9.00 each time). I do have access to my wife's paycheck as well, which she pays our cellular bill and our babysitter with, $150 and $120 a month respectively.

Anyways, everything that is a monthly bill is automatically withdrawn from my account where I can. The thing I discovered with this is, with a few companies, they don't exactly advertise this service. This is how they can collect late fees from us. By making a few phone calls and visiting a few websites, I was able to get all but one company automatically withdraw my bill from my account. The last one offers this service, but someone on their end is a little illiterate and cannot figure out why my account is the only one in the entire USA that cannot have this service(I'm working on it though!). The benefit of this? No late fees! I don't have to make time to visit, don't have to write out checks, don't have to call and give my card number out to a random person, etc.. That part of my life is automated. Easy enough right?

I found out yesterday that my employer will send my direct deposit to several different accounts if I so please. A lot of employers do this, I've just never put this to use. The major benefit to doing this is that I can save money and never see it actually withdrawn from my bank, so I can get myself used to living on a little less. You can't spend what you've never seen in the first place. With me though, I use a program on my phone that I view all my accounts at once on, and so therefore I know the money is out there. I've combated this in a sense by making my checking account local, but my savings account through INGDirect. It'll take 2 to 3 business days for me to transfer money over to checking, so I'm less likely to put in the effort to do so. My wife has began to save money out of her check, and soon she will be depositing that into my savings account after I set everything up.

I'm looking for budget ideas, as I'm always looking for something a little easier, or just good idea's in general to add to the arsenal. Comment!

The Budget

2011-10-17T06:00:00.000-05:00

I'm not completely sure if what I do can be considered a budget. I'm always looking for easier ways, and the way I'm currently doing things has been working for the past year. It has definitely been tweaked, and I'm still tweaking things today.

I'm paid twice a month, the 15th and 30th. Weekends and holidays juggle the payday at times but that's the schedule we stick to. All of my bills, minus food and gasoline, add up to $1286 a month. I figure $1300 for a round number and for a just in case scenario. Those bills, divided by 2, gives me $650. Everything over that amount is withdrawn from my account, and is money that goes to food, gas, haircuts, and general items for the house and my personal "needs." While that doesn't give me a complete look at where my money is going, it works.

I have my retirement automatically withdrawn from my check so that's taken care of. In my case, however, you're not given the option with the state to put in retirement or not. So for some, that may not be enough. I was heavily searching into IRA's when I got a statement yesterday detailing what an old 401(k) account I had was worth. I had completely forgot about this. It's only worth about $250 (wasn't at that job long!) but I have it there so rolling it over is an option. Plus, it's through INGDirect, and that's where my savings account is through. For my next post, I'll be blogging about how I actually go about paying Mr. Bill.

The Debt

2011-10-16T19:00:00.001-05:00

The following is an overview of my debt. I pulled my annual credit report yesterday and have added everything up. There are a couple things on my credit that I won't be paying on, for personal reasons I won't address here. The following totals do not reflect those items.

Installment accounts (7 Items) - $3602
Medical (7 Items) - $1306
Student Loan - $11,000

I will be paying those off in the order listed. I'll be putting some more progress bars up in due time when I began paying on them. I want to complete my small emergency fund before I start this process.

The Bills

2011-10-15T17:38:00.000-05:00

So I got paid today. A lot better of a check than normal, I worked a little overtime. So I'm going to break down my basic bills below, not to include Auto Gas and Food. Why? Our gas varies a lot, same with food. I haven't been tracking it with the way I budget, but it's a task for a later date. Here we go!

Rent - $500.00
Utilities - $250.00
Car Insurance - $90.00
Auto Payment - $248.00
Internet/Cable - $104.00
Washer and Dryer - $94.00

These are rounded up figures, and it's how I figure it. My Utilities number is high, but never has it been over that much, some months they total about half of that. With my internet/cable bill, those are through 2 different providers, so with my cable service, it's $57 a month, and getting ready to be in the $80 range here soon. As soon as my contract is up, I'll be cancelling this service and using a combo of Xbox Live/Hulu Plus/Netflix to bring that number to about an average of $25 a month. That could change if I find another cheaper route. My washer and dryer is through rentacenter. We sold off the ones we had when we moved to low-income housing, as we didn't have need for it. It's cheap enough to work with, and it's warrantied the entire time we are paying on it and for a year after it's paid off, so that works for me.

As far as debt, I have some. I haven't looked at my credit report this year so when I do, I'll post the figures here. She got paid today also, and set some money aside for us to start saving. Now to set that up. I've already put a Emergency Fund progress bar up on the side. It's not three months worth like I am ultimately going for, but its a good amount to have so I can start paying down my debt. I have my next post already running through my mind, so stay tuned for that.

The Situation

2011-10-12T21:05:00.001-05:00

The last time I blogged here I was jobless. I was dependent on my $7,300 tax return to hold me over until I found employment. I bought an $1800 piece of junk car and paid my mom her $1000 back. I was dependent on my mother to pay my cell phone bill and my car insurance, and those two items were paid by her for a very long time, even before I had started blogging. That summer I got a little paper route, and made about $100 every week, until I wrecked my car into something unknown in the middle of the night. I could no longer do the route and had just spent $1000 trying to fix all the problems I was having from the car.
What saved me though was the fact that I had enrolled in school right after I started blogging. I signed up for all the student loans I could get (Bad Mistake!). Right around the time I had that wreck my financial aid check came and I bought a nice mini-van for $3400. The car would never start again after I wrecked it, and it sat outside my apartment for a year. I sold it for $150 and had it crushed.
I was in school a little over a year before I got bored, and irritated. It got to where I was arriving to school an hour early and still was late to class because I couldn't find a parking spot. Plus, I had broken my foot and it was not fun going to class during the winter with ice on the ground. I could never get approved for a temporary parking pass so I could park closer while I was on crutches. I ended up dropping all the classes that semester.
I took summer classes in 2010, and passed those, but didn't feel challenged, or I was just lazy. I wanted to work. I applied for a state corrections job in Oct. 2010, a field I have experience in. I got that job, with a raise to start because of my previous experience. Thing is, my state is THE lowest paid state compared to all the surrounding states, and I rake in a whopping $24k a year. Bright side is, it is $24k I didn't have.
As of today I'm still at this job, and due for a 5-10% raise Nov. 1st. Not much, but I'm not complaining. During my college time my wife was able to get her Nurse Aide license and is now working in a nursing home. We have moved into a house we rent, and it's right in the middle distance wise to our jobs. Hers is 30 minutes one way, mine is 30 minutes the other way. Needless to say, our gasoline bill is through the roof. I sold off the mini-van in Feb 2011, and bought 2 cars for us.
For the first time since I was 19, roughly 8 years ago, I'm completely independent and pay all my own bills. That is sad to say, no one should be my age and still depending on their parents. I don't feel very good about that, but that stage in life is gone. Me and her both are enrolling back in school next year, without student loans, and going to further ourselves in the careers we have chosen. I'm always on the lookout for better paying state jobs, but I'm not being very active in the search as I'm satisfied in my current position.
This is a quick run-down of what has went on the past couple years. It's not a thorough description, but you get the point I hope. I want my next few posts to cover my financial situation, and what you, as the reader, can expect to see content wise on this blog. I'm still working on giving the site a new look and updating lots of information, so please be patient and subscribe, comment, and all that good stuff!!

Stay Tuned...

2011-10-12T09:31:00.000-05:00

I am updating the site and going to be blogging again. A lot has changed. I'm changing up the design on the blog so stay tuned. In a couple days I'll have a fresh post and we'll be back at it like we never missed a beat. Thanks!

Payday Loans... Legal Loansharking?

2009-03-02T19:32:00.000-06:00

Posts like this have been made countless times by a countless number of people. I feel the need to throw my input into the mix as well, as I have insider experience.

For two years I was a branch manager of a payday loan company. When I took over the store, I was the youngest manager within the company's 200 plus stores. The store was losing thousands each month. Within my time at the company, I brought the store up to making over 37,000 dollars each month, with virtually no defaulted loans. I was rolling in money at the place, as I received 5% of that 37,000+ as a bonus, on top of my hourly wage. My store had the highest growth rate in one year, which I recieved another bonus for, lowest defaulted loans for the year... another bonus. During the end of my time, my district manager had made me the trainer for the district, and basically give me half of her district to tend to as well. When I traveled, I did so in my own vehicle, was paid gas mileage, plus 40 dollars for food expenses. I was put up in a hotel at times to help with setups of new stores and was given even more money as a living allowance... well over what I needed to "live." If I was required to run a store for a period of time, I would get a bonus for that store, plus the bonus for my home store. The moral of this story is that there is tons of money being made through payday loans.

The interest rate on these 2 week loans were upwards of 450%. They also make money on cashing payroll checks, fax services, copying, doing taxes, money orders, etc. They prey on the poor and weak, I don't care how much the commercial say's "Please use payday lending responsibly." They are in the business of making money, and by lending it to the poor and charging outrageous interest rates, they keep making money. A person borrows $200 dollars, and two weeks later, has to bring in either the $30 dollar interest rate to "roll-over" the loan, or bring in the whole $230 dollars(Kentucky law does not allow the "roll-over" system, that's why I mentioned both). When someone pays off the loan of $230 dollars, they are now needing money again, and couldn't afford to just pay the loan off. So they borrow the same $200 again. Two weeks later, they pay basically another $30 fee, and borrow the same $200 again. This is what the lenders want. After so long, you've paid thousands in fees, yet your still borrowing the same money you borrowed in the first place. They are not like a finance company, where you pay a payment on a loan and eventually it gets paid off. The loan just keeps going and going until you pay the full amount of your loan and walk away.

People can avoid these traps by simply not falling into them to begin with. Whether you need the money now or not, just don't use them. These companies can take you to small claims court if you default, and can even garnish your wages. Lucky for people in my town, the county attorney hates payday loan companies, and therefore will not set up a small claims case for any representitive of the company.

I know I've rambled a lot, but I had a point to make. If you are already in this trap, call the office and ask for a payment plan, as you can not make the full payments any longer. They should set you up on one, and you can slowly get rid of this trap once and for all.

Finances Update

2009-03-01T23:39:00.000-06:00

I figured that I would start off the month right by listing my finances, that way you guys can follow along. I am going to be keeping this info updated as much as possible to the right of the blog on the homepage. A nice quick glance at how I'm doing so far.

The IRS has given me a refund date of March 10th. I am ready for this to come. I need to buy a car badly. My kids need things as well. I've done spoken to the boss(my wife) about how we need to buy extras of the things we absolutely are going to need for the next few months and put back some emergency cash before she tries to go wild and spend it all(she's the spender in the family).

I received my final paycheck from my job today, all of 178 dollars. I should be getting a refund on a water deposit I made with the house we just moved from, so I'm expecting over $50.00 there.

I have no job prospects yet. So we will be stretching our refund for as long as we have to. I have been looking on the internet as well for work, something I can do from home. I've been doing a little pay-per-click sites, but at .005 per click, I can see I am getting nowhere fast. Anyone have any leads on online work that's more promising?

Credit Cards and Living Without Them

2009-03-01T00:29:00.000-06:00

I have long since been against the use of credit cards in my life. I've never owned one, and don't plan to. What exactly is the use for them? I know some offer all kinds of rewards or cash-back, but you're still left with a bill to pay, most of the time you pay more to the credit card company than you actually paid for the item. So that brings me to say (as I have been before I have even been into personal finance as much as I am now), if you can't pay for it now, then obviously I can't afford to buy it.

This standard is exactly why I have no credit debt. Outside of a home, I believe nothing should ever be bought on credit. I do believe as well, in very certain circumstances, that a car note may be acceptable to have. Some people have no other option than to carry a note on a vehicle. Those being the ones that have decent enough credit, but no cash. They may wind up being swindled in a sense to a higher car payment, but they have what they need to get where they need to get. In a small town like mine, where there is no public transportation, a vehicle is almost a necessity.

I'm sure people believe that credit cards are necessary for emergencies, I just don't see where though. If you have your credit card, and your credit card is in your wallet, then where is your cash or bank card? What about next month, when the statement comes in, are you going to have the money to pay for your emergency? If you can pay off the balance every month, by all means, go for it and help your credit score, they are just not for me.

Now I'm not badgering the use of credit cards or the people that use them, I've just personally never seen the point in them. I've noticed a lot of people, including fellow personal finance bloggers, have accumulated tons of credit card debt. Will at mydebtcomeback has accumulated a whopping 647,000 dollars worth of debt. Tricia at bloggingawaydebt.com has shown to the public how far they've come from their 37,000 dollars worth of credit debt. While these numbers are outrageous, I envy these bloggers for paying down their debt, and trying to get rid of credit cards altogether out of their lives. These two blogs, however, aren't even a fraction of the personal finance blogs out there that speak about how the blogger themselves are in debt to credit cards. All of them are working towards a goal, and they are all using a different system for obtaining that goal. From Dave Ramsey's “Snowball” approach (more on that approach here), to an all out “throw everything towards debt” approach, they are paying it down, and each of them is going to be proud to say that they too are debt-free.

Can you live without credit-cards? Please feel free to enlighten me on the benefits of a credit card, besides helping your credit score.

Online Banks I've Been Recommended

2009-02-27T22:48:00.000-06:00

With my tax refund on its way, I figure that I should get my savings account going again. I logged onto my online savings bank, and noticed that I was getting 1.85% APY. This is much smaller since the last time I looked. My balance of 3.47 is small as well. I thought it would be well over a million by now(that was a joke!). There was a time not long ago where online banks could have interest rates upwards of 5.00%. This is not the case nowadays. Online banks are averaging around 2.00% today. Still much better than the average savings rate of 0.42% that you can find at normal brick and mortar banks. Below is a list of three banks that I've been recommended, outside of the one I have open now.

Gmac Bank: APY of 2.75. Only $1.00 to open, and no minimum account balances.
Igobanking.com: APY of 2.00. Only $1.00 to open, and no minimums.
Bank of Internet USA: APY of 2.50. $100.00 to open, no minimums as well.

I have no experience with none of these banks myself. I have heard good reviews about each of them, and these 3 seem to help me out as far as minimums and start up balances. All stats were pulled from Bankrate.com. Hopefully soon the banks will be able to bounce back from this mess, and we'll all be able to benefit once again from high savings rates.

Taking a Sick Day

2009-02-27T00:08:00.000-06:00

I was going to take a sick day from posting today. A virus that has been circling my family for a few weeks has finally hit me, and put me down for the count for the day. It got me to realize just what being broke and out of work is really like.

When sickness hits the poor and uninsured what are they to do? The best thing I think that can be done is go to the emergency room and hope for a cure while you are there, instead of the doctor seeing you and giving you a prescription that you can't afford in the first place. Doing this though, causes that medical bill to go right to your credit report, which just causes more damage in the long run. I've only spoken to one bank that does not hold medical bills against a person when applying for a line of credit.

There is no state benefits for someone perfectly able to work, only the disabled and children, which I'm not complaining about because of that fact that I am able to work and be offered insurance. So what's a person like me to do?Other than the above-mentioned E.R visit, there's only one thing to do, and that's say, "I'll be over it tomorrow... Hopefully."

Money Manager Ex and Budgeting

2009-02-25T16:15:00.000-06:00

Money Manager Ex is a free tool that I use to set up my "spending plan." With it I assign every dollar to a different account to be deposited in from my checking account each week. This is the same as Envelope Budgeting. Money Manager Ex is a great program that reminds me a lot of a much more condensed Microsoft Money. Really worth a look if you need a program that does not cost any money and gets the job done. You can download it here.

For each of my expenses I have an account. Each week when I had a job, I would deposit 1/4th of the total monthly amount into the account(eg: 6.25 deposited four times would equal my rent payment of $25.00). When the bill comes due, I have the money to pay the bill in the account. I debit the account, and start over again the next month. In those months where there are 5 paychecks, I would withdrawl the money into a savings account.

On top all all this, I would deposit 10% of my earnings into a savings account as well. Anything left over is spending money, to buy household items and to just "blow."

Now, without employment, I am forced to throw that idea out of the window. I have to start from scratch again. Feel free to leave suggestions

My Current Financial Situation

2009-02-24T22:39:00.000-06:00

I am going to give a break down of my current finances as of this day. Then I will be updating this as much as possible in new blog posts titled, "Today's Finances." Lets Begin.

Current Cash on Hand: $25.00
Current Checking Balance: $107.30

I have my last check coming this Friday, then that will be the last of my weekly income from a job.

Expenses:

Rent: $25.00 (Includes all Utilities)
Child Support: $190.00
Gasoline: approx. $80.00 Monthly

Except for Gasoline, those amounts are fixed at this moment. I have other needs as well, such as toiletries and baby items(diapers, baby wipes, etc.) that are not fixed expenses. These items may total in the area of $100.00 a month.

Where's the Food!? Thanks to the government, I do not have to pay for food at this time.

We watch movies that we borrow from people, so no cable bill. I have access to the internet through a wireless connection at the apartments that no one pays for. Although it is limited and hard to keep connected, it'll do for now. I have a fairly large(for me anyways) tax refund check around $7,300 dollars on it's way, should be getting that within two weeks. This is what is going to hold me over until I find employment. I do have to buy a vehicle and pay back a debt to my mother of $1000 out of this refund. But I should still have plenty.

Well, there's an overview of my finances. I will keep you updated as much as possible. Thank you for reading.

Welcome!

2009-02-24T22:30:00.000-06:00

I am laid-off from my job. Can not receive unemployment benefits either. I won't be recalled.

I live in a very small town where jobs are limited. Used to not be that way, but the recession hit hard here in Kentucky. I was fortunate enough to know that I was going to be laid-off two months in advance, so I began a job search, but to no avail. I also applied for section 8 housing, which I received and got to move into a small 3 bedroom apartment last week. Because of my current employment status, my wife with no work, and 3 children, my rent including utilities is a whopping $25.00 a month. My car is also broke down, so I have been borrowing my mothers car for the last 4 months to get around.

I lived in a much larger 3 bedroom home, 15 miles away from town, 20 minutes away from my mother. Which if you can imagine, was a lot of driving when my mother had errands to complete and I was at home. Now I am located in the middle of town, so the stress has went down a little. My oldest child goes to school still in the town I did live in, so I still drive her there every other week(I have shared custody of her), since the year is almost out. Then she will be transferring to a closer school for me.

I am 25 years old. I should have had a career already. Therefore, since my rent is a lot cheaper now, me and my wife both will be going back to school. I plan to get whatever work I can find here in town, and go to school entirely online through the state school system.

In my next post I will be reviewing my financial situation for you to follow along with. Thanks for reading.