Comments on: Could you handle losing 15% of your income tomorrow?

By: donna jean

donna jean — Tue, 07 Oct 2008 20:02:17 +0000

I agree with many of the comments above. I open and honest about our continuing to make poor financial decisions and slacking off about keeping up with expenses.

It was only in the last 2-3 weeks that I finally caught up on our balances and was entering numbers from May. I was totally ignoring the impending doom and of course it burns pretty bad when you take that approach. It just cracked me up a bit that as soon as I finally took a real look at stuff and figured out how to make it work, I ge side swiped by the news.

So, yes – we have debt that we shouldn’t have. We’ve continued to make purchases that we should. We own more house than we can afford — no strike that, as the partner points out, we have more house than *he* can afford. We bought the house together with two incomes and then went down to one.

But, all the hindsight complaints don’t do much to help things going forward unfortunately. So it’s still going to be lots of hard work for us to figure out how to make things work. Maybe we will, maybe we won’t.

By: JoeTaxpayer

JoeTaxpayer — Sat, 04 Oct 2008 23:05:35 +0000

For good or bad, both Mrs Taxpayer and I have variable incomes. A good year as high as 150% of a bad year for income. So we’ve pretty much learned to budget on the 100%, and in a good year, save extra, throw more at the mortgage, or tackle an expensive project. We are used to swings much more than 15% and just live with it.
Joe

By: traineeinvestor

traineeinvestor — Sat, 04 Oct 2008 11:55:33 +0000

It’s happening to us as well. I’m expecting my monthly income to drop about 20% off its peak earlier this year.

Fortuntely we live well within our means and will still have a reasonable (if unspectacular) savings rate.

That said, there is room to cut the expenses and I/we are having discussions about whether to cut back on our living expenses and, if so, which items. It may be a lengthy discussion.

I agree with everything Enough Wealth says.

If you have run out of expenses to cut, the next items to think about are (i) selling and coupons to clip things you do not really need (especially things that cost money to maintain) and (ii) looking for ways to create a side income. Another possibility is to change jobs (which may not be the easiest thing to do at the moment).

If you are having issues with other half accepting the situation, there may be local help services who can offer a budgeting service.

By: Enough Wealth

Enough Wealth — Sat, 04 Oct 2008 08:43:50 +0000

Just reading through the past dozen or so posts it appears that
> you bought a house at the same time you had/were expecting a new baby
> you have THREE cars
> you ate our (Thai), hosted a party and paid airfares to go to a relative’s 75th birthday party

I can see how your partner getting a 15% pay cut when you had been expecting a pay rise in July would stretch the budget, but it seems you still spend on some things that really are wants rather than needs.

Perhaps selling off two of your three cars and saving a bit on insurance, repairs etc. would help. The odd taxi fare in a real emergency would work out cheaper than maintaining a second (and third) car.

But although trimming the budget further may help, it seems that you simply bought more house than you could really afford. (I don’t think anyone should buy a house if they are carrying a CC balance.)

If your partner can’t/won’t change jobs to get a pay increase, perhaps you can take in a border to get some extra income?

ps. I don’t see why you partner can’t get a second job. Doing unpaid overtime for a company that just cut wages 15% is insane.