Help a Reader: “How can I maximize my money when I feel like there’s never enough leftover to save?”

I got a pretty common (and in depth) email shot my way this week on something most of us are trying to get better at ourselves – having money left over every month. So I thought it was worth sharing today and getting your take on it as well.

My advice to her was pretty much what you’d expect from reading this blog for more than a day (aka hustle hustle hustle!), but hopefully with your fresh perspective/tips it’ll give her an overall better picture of what she needs to do to overcome this phase of her life :)

Here’s her email copied and pasted below, followed by my response to her with thoughts. It’s pretty long, so feel free to read just the first sentence and then advise from there, haha… Thanks guys!

Our dear reader’s email:

Long-story short: I went bankrupt at 28. How can I maximize my money when I still feel like there’s never enough leftover to save?

Long-story Long:  I was married from 2006-2009 to a guy I ended up divorcing. To that point, I had good credit. Not great – It was fine. I bought a car here and there but my income was fairly volatile, as a nanny. My credit was GOOD, though.

When I left my ex, I moved back to my hometown and into my childhood home. I had no income and a small amount of debt from student loans (less than three grand) which I was able to defer (and continue to defer with income-based repayment through January 2014).

I consulted with a bankruptcy attorney for advice and decided to move forward after being served by a company with whom I’d supposedly had a credit card. I did some digging and found so many delinquent accounts that I had no idea what was happening. I can only assume that my ex let everything go down the drain when I moved away.

It has been almost two years since my bankruptcy was finalized and since then, I have opened checking and savings accounts with USAA and obtained a secured credit card. I recently became eligible to participate in my company’s retirement savings plan and I invest 10% of my income automatically. I have the small CD attached to my new credit card, but I’m still wondering how to maximize my income when it feels like I never have anything leftover?

I make just over $35,000 a year and remarried last summer.. my husband makes just over $38,000 .. Combined, we look like we make a good amount of money compared to the cost of living. I am trying really hard to educate myself by using all the tools available to me.

We own our house (which he purchased in 2005 for $87k @ 6% .. ew) with a second loan. (approx $20k @ 8.5% with a ten-year balloon payment. EW!) We’re in the process of renovating this 1895 home and our finances. I have $10,000 in student debt; my husband owes approximately $16,000 between his car loan, a line of credit we’ve used to finance house projects, and a couple of credit cards…

We are always spending to zero from week to week, but I can’t really find anywhere to trim our expenses. HELP? We pay all costs related to our restoration with cash unless they’re really high-ticket purchases (like the furnace of 2011). At this rate, our house will never be finished and we’re going to work until we die because we can’t ever save! What do we do!

Thanks – for reading, basically, my entire life story – now I feel like a creep! ha…

My message back to her:

Hey new friend! You’re not a creep – just passionate about figuring out a plan – I dig it :)

It’s hard to advise on a situation without knowing your personality, or all other details outside of what you’ve put here, BUT, from a first glance it looks like the #1 thing either of you can do to speed things up is fairly obvious: earn more money (notice I didn’t say “easy” ;)).

I’m sure we could pick apart your budget and cash flow and come across a few ways to save a few bucks, but that’s really not going to do anything major I feel like in your current situation. Unless there’s a way to combine and refinance your loans at much lower rates without you having to dump a ton of money into it in the process? But I’m guessing/hoping you’ve already looked into that…

So, it’s back to getting higher incomes :) How can you guys bring in more which at this point would all become “extra” that you can apply towards all your goals? Can either of you take on a 2nd job a few hours a week? Can either of you ask for a raise? Can any of your offer any services or build something that someone can pay you money for?

All this money stuff comes down to two things: expenses and income. If you feel you’ve done your best to limit the expenses, then it’s time to focus on the income. Even just hustling to make an extra $200 a month would probably do wonders with your situation :)

That’s really all I have for you to be honest. Again, nothing mind-blowing or new to you I’m sure, but it is the reality of the situation at least from where I’m standing. I will congratulate you on overcoming all that nonsense in the past, though, and also investing so much of your income right now – that’s great. Also with going with USAA too, which I strongly have an attachment to :)

I wish you the best either way. You’ve come really far and you can still keep going!! Just keep in mind that all of this is just a phase, and do your best to hustle hustle hustle.


What do you guys think? Anything I missed and didn’t see? Would you advise differently than just “make more money?” Haha… I tend to always skew that way being biased with it myself (I’m not a big “save every penny and it’ll all add up!” type guy when we’re talking major life changes/needs here), so thoughts from varying experiences/plans from you all will probably help shed more light on her situation.

Again, I think this problem of never having money leftover at the end of every month is pretty damn common in this world of ours today – so your tips may very well help hundreds, if not thousands, of other people reading this too.

So thank you x 100, guys! Or, possibly x 1,000! ;)

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  1. Aimee November 13, 2013 at 6:57 AM

    1. Is any part of the student loans federal? If so, do you or your husband work public service jobs?

    2. Consider cutting up your credit cards if you’re carrying a balance. Maybe leave 1 frozen for emergencies.

    3. Do you have an emergency fund? This could do wonders for stress relief.

    4. J is right, one or both of you need to pick up an extra job if possible. You know the money making potential for nannying/baby sitting. Hit

    5. Create a budget spreadsheet so you can “see into the future”. It might give you a sense of control even if the future doesn’t look the way you want it to yet.

    Good luck and don’t give up!!! :)

  2. Tony November 13, 2013 at 8:07 AM

    “At this rate, our house will never be finished and we’re going to work until we die because we can’t ever save”

    That’s not true, you’re saving 10% of your salary into a retirement plan. Even if it’s really only 5% total if your husband isn’t contributing, that’s still something, so the situation isn’t all bleak. Also, as J said, wanting to do better isn’t being a creep!

    My advice would be the opposite of J’s, spend less money. While earning more is definitely never a bad thing, $73,000 is a pretty solid salary (and if your house cost 87k in 2005, I’m guessing a not a crazy cost of living area). So I have to question where is all of it going. If I did my math right, that’s a take home of about $5000/month after taxes. I’m a little unclear on what you’re paying on the home loan, but my best guess is it’s not more than 1200/month. The student/car/etc. loans will eat into some of the rest, but it still seems there should be a decent amount left for spending, unless you’re just throwing a ton of extra money at those debts. If that’s the reason there’s not a lot left, then good. In that case they’ll be paid of in no time, maybe a couple years or less, then you’ll have all this extra money that you can pour into savings and make up for lost time.

    1. Aimee November 13, 2013 at 2:18 PM

      I agree Tony, except the mortgage is probably waaayyy less than $1200. The combination of credit card balances and having no money left over makes me think this reader is spending more than she thinks.

  3. Holly@ClubThrifty November 13, 2013 at 8:12 AM

    Can you refinance our home? We’re currently in the moving/buying process and the rate on a 15 year mortgage is about 3.5. Even if you needed a new 30 year mortgage, you could save a ton! That should free up some cash!

  4. John S @ Frugal Rules November 13, 2013 at 8:21 AM

    Great suggestions J! I think expenses are key, but will only take them so far in the end. They’re definitely doing something right by automating the 10% into the retirement plan as so many are not even doing that. I’d say, just like you, find ways you can make more money and think outside the box in terms of what you can do.

  5. jestjack November 13, 2013 at 8:29 AM

    I too disagree with our blog host. First ….challenge everything in your budget….cable, cell phones, electricity, fuel, cars, credit cards, etc. Look for ways to get your products cheaper. Second today…not tommorrow…look into a refi. The “juice” (interest) on the mortgage and equity line are considered high in todays market. In my neck of the woods 3.5% is achievable. Soooo combine the two loans into one for say 95K @3.5 to 4% ….even at 4% the new payment would be $459. According to my calc this should free up about $300 a month…with no balloon payments.To me household income of 76K is pretty good it’s the expense side that’s out of wack. I will agree that furnaces are “budget busters”….

  6. Financial Samurai November 13, 2013 at 8:39 AM

    Probably best to just track like a Samurai all expenses and incomes for 6 months straight b/c it is kind of concerning you found out you had delinquent accounts you didn’t know you had.

    You guys have a HUGE combined income compared to the cost of your home. I think you’ll be fine! Just don’t spend like Snoop Dogg any more.

  7. The Warrior November 13, 2013 at 8:51 AM

    I fall into the how-can-we-increase-income category as well.

    Mrs. Warrior and I are working towards the goal of generating certain increases in income each month. Focusing on increasing the income, maintaining the same budget, and putting all additional income towards wealth building has been our best course of success.

    The Warrior

  8. Alexa November 13, 2013 at 8:59 AM

    I’ve been in a very similar situation. My problem was I’d all too often compare myself to others. I could save like $20 a week but then I read blogs about people saving $500 a week and I thought “what’s the point?” I also had the income/expense problem too. I was living on a bare bones budget and honestly there just wasn’t much leftover. I started freelance writing and little by little my side income grew (by doing something I enjoyed) and I was able to save more. Now I’m well on my way to having 10K in savings. It took me a year to get there though.

    My advice is don’t compare yourself to others. Save what you can even if it’s a small amount and feel good about it. Secondly find a way to bring in a side income by doing something that you enjoy. There are all kinds of fun ways to earn extra money.

    Good luck!

    1. Kathy November 14, 2013 at 3:31 PM

      I know what you mean about saving $20 a week while others are saving $500 and feeling defeated. I’ve been in that same boat. …still kinda am until I pay off my credit card debt. (11 more payments to go until I’m debt free!)

      However, I read a comment “somewhere” about a person who had $2 – $3 left after paying everything and she was very depressed about not being able to save “like everyone else”. Well, she changed her mindset to think of it a “$2 – $3 saved is MORE than zero saved”.

      And, eventually, those dollars add up and you’ll have a nice little fund there. So, save whatever amount you can and when things change in your life your savings will most likely change too.

      1. J. Money November 15, 2013 at 11:40 AM

        I like the way you guys are talking :) *Anything* is better than nothing, that’s for sure!

  9. Paula / Afford Anything November 13, 2013 at 9:25 AM

    I agree with J, increase your income. That’s the fastest way to move the needle.

    In addition, I’d love to see a detailed budget of where your money is going. It sounds like you have a high income relative to your mortgage. If you’re throwing a bunch of extra money at your debt, well, that qualifies as savings in my book.

  10. Andrea November 13, 2013 at 9:26 AM

    I’m a big fan of both categories. But I think you have to be honest with yourself–where does your money REALLY go? Do you go out to eat? Have you considered joining Costco or Sam’s and shopping in bulk? Even for things like toilet paper, toothpaste, granola bars…it saves a lot of money. Look back at your bank account if it’s available online; it’s sobering. (“How many times did I spend $4 at Starbucks?! Dammit!”) How much money is going into your retirement accounts? That counts. I sometimes think, Ugh, I’m so broke, but then I see my retirement and savings accounts and realize that I’m not broke, I’m just being smart!

    Also, looking for other jobs is crucial. I spend more time on than most people do on Facebook. Craigslist is another good one. I take pretty odd jobs sometimes–cleaning an office building, going door-to-door asking people if they want their houses painted, hauling various kids around to their activities, nannying. You can never have too many odd jobs. It’s a great way to network and it also shakes up the regular work day. I really enjoy picking up my two girls everyday because they offer a fresh perspective, they’re fun to talk to and they’re really intelligent (plus is $200 a month…) Am I tired? Sometimes. But am I happy? Way more than I was when we were living paycheck to paycheck.

  11. Scooze November 13, 2013 at 9:40 AM

    I aree with the other posters that there is likely more savings actionable in your current numbers. I have two additional thoughts:

    1. How much is this balloon payment going to be on the mortgage and are you planning for it? This scares me.. refinancing may be a better option if you can’t say 100% for sure that you have it saved.

    2. How diligent are you in checking your credit reports? You don’t seem certain that it was yiur ex getting credit in your name. Did you report this to the police? How do you know someone out there isn’t still a possibility of fraud. Make sure your credit is FROZEN.

    Good luck.

  12. TimRiggins November 13, 2013 at 9:48 AM

    My advice would be to hold off on renovations while you get expenses under control for a set period of time – say 6 months. During those 6 months, be brutal about food, transportation, clothing, etc. And save all of the money that would have gone toward renovation in an emergency fund. Also, with the time that you aren’t investing in the house, you can focus on increasing your income Once regular expenses are under control, then make the time horizon for all renovations very long-term (5 or even 10 years?).

  13. Tara @ Streets Ahead Living November 13, 2013 at 10:12 AM

    Making more money is probably the best option at this point. It’s hard to swallow but even waiting tables every Saturday would at least be an extra $50-$100 a week that can go towards debt repayment. I’m living in a bit of denial myself as I really should be working part-time to make some money. That’s my goal for 2014, to try to at least babysit or something to earn some side cash.

  14. Wunderwriter November 13, 2013 at 10:22 AM

    I would take a hard look at the 10% you’re investing from your income into your company’s retirement plan. With any debt at all, that’s usually not a great idea, particularly if you have many years to make up the difference. I know old school logic is “pay yourself first,” especially when your employer offers matching funds (I didn’t see whether they do or not). If they don’t, I’d take that 10% and judiciously pay down debt, highest interest rate first. I’d STOP all home improvement. You need to refinance out of that bullet second (they’re called “bullet loans” because they’re like having a gun to your head), or pay it off before it comes due. If you can’t make more money (not always an easy option), you need to spend less and allocate your funds more wisely. Home improvement projects don’t trump debt, in fact, nothing except “free money” in the form of company match does. I’d turn off the new furnace and wear a sweater, eat rice and beans, watch movies for entertainment, and pay off all debt as soon as possible so I could concentrate on getting rid of that second lien. Even if neither you nor your spouse earns another dime, paying off the debt and the second will make you much, much more comfortable and secure, and increase your credit score as well.

    Good luck!

  15. Anthony November 13, 2013 at 10:35 AM

    I don’t disagree with everyone else’s comments. Yes, you should probably try to make more money. And yes, you should try to cut your expenses.

    Thinking a little outside the box here: I think that you’re spreading yourself too thin. You’re trying to save… and you’re trying to pay your mortgage… and you’re trying to do renovations… and you’re paying on cars, students loans, credit cards… and you’re socking away 10% into a 401(k)… and (maybe) you’re trying to salvage your credit score. Attempting to do all of these things at the same time means that you are seeing very little progress in any one of these categories.

    Pick one of these things (I suggest paying off your debt and committing to never go into debt again!), focus on it, and pull all of your extra time, effort, and money into that one thing. If you pay off your debt, for example, you may very well free up $400-$500 per month.

    I personally disagree that you should perform any renovations on your home (unless it’s a true emergency) while in debt. Even if the home repairs are emergencies, then that is just more reason, I think, to get out of debt first. Otherwise, you will just continue to finance future repairs.

  16. J. Money November 13, 2013 at 10:36 AM

    THIS IS GREAT GUYS! Thanks so much for sharing and spending the time here – really means a lot. I’m shooting a note to our fellow reader now to let her know y’all have some thoughts for her. You’re awesome :)

    Keep ’em coming!

  17. Martin November 13, 2013 at 10:59 AM

    You just have to make more money sometimes! There’s no way around this. That’s why I always write about freelancing because it’s the fastest/easiest way to increase your income. And it’s fun!

    You don’t have to do something that you hate. You can pick something you already do and just charge to teach it. One of my friends started teaching BJJ now. He basically gets paid to do something he was already doing.

    Good luck!

  18. FrugalTeacher November 13, 2013 at 11:04 AM

    One thing I do – and it is minor – is budget for a gain. That is, I make my budget such that if I hit everything on the nose, I spend $100+ less than I brought in that month. Sounds minor, but it does two things.

    1. Over time, you learn to live within that budget and spend less.
    2. You are slowly building an emergency cushion on top of any emergency fund!

    Right now I’ve found I have nearly $1k extra in my checking account. Some of that will be lost to christmas shopping, a car repair, and a bachelor party, but after all those, I’m throwing the extra at my loans!

  19. Kristie November 13, 2013 at 11:05 AM

    I’m not quite sure what your age is, but by your email I’m guessing you are still quite young. And that’s a great thing, sister! Look at all the broke people around our country who are much older than you and don’t have the income you do. You’re giving your financial future serious thought, so you are way ahead of the game!

    1. Stay positive. Be kind to yourself. Leave the past where it belongs.

    2. Track your spending habits and cut back where you can, even if it’s only a few bucks here and there. Small cutbacks will lead to bigger cutbacks. Saving can be an addiction just as easily as spending!

    3. Could you rent a room out to generate income? (Totally an inconvenience, I know, but money is money.)

    4. Nanny?!?! Babysitters in my area get paid big bucks. Perhaps you could dedicate one weekend a month to having a group babysitting session. Arts and crafts, popcorn and a movie and charge a flat fee. Parents need the break and kids need well-organized fun. Send a child home with a great art piece and a smile, and you’ll have yourself a client for as long as you’re willing to offer the service.

    And to share a quick story with you…I knew nothing about finances and was a single mom for many, many years and had only my income to raise my kids on. My first home was 88k and the first stock I ever purchased was Disney–a whopping FOUR shares for $150!!! It’s all I could afford at the time. I still have that original stock, plus the eight additional shares they GAVE me along the way. (Check out Disney and you’ll see how much those original four shares are worth.) Small savings and small investments grow over time. Make lots of them! I consider myself the tortoise. Through patience and dedication you too will make your way to the finish line of your dreams. Good luck, girl!

    1. J. Money November 15, 2013 at 11:42 AM

      This made me smile :) Thanks for chiming in and sharing!

      1. Kristie November 15, 2013 at 2:53 PM

        I love finance and people, and I dig writing! So thanks for giving me (and all of your readers) the opportunity to chime in. I did, however, forget to note in my comment that my Disney dividends, which were pennies in the beginning, have paid for about half of my initial investment. Oh, and I did retire two years ago at the age of 45. Lots of Disney scenarios. ; )

        Love your upbeat take on finance!

        1. J. Money November 19, 2013 at 5:02 PM

          Thanks! That’s certainly my intention with this blog, so I’m glad it’s coming off that way :) There’s too much nastiness out there in this world, and I def. don’t want to be contributing to it.

  20. Rebecca @ Stapler Confessions November 13, 2013 at 11:11 AM

    I thought that we couldn’t chop anything else from our budget, but then I went to the forums at Mr. Money Mustache and they put me in my place: No more dining out, no more spending on unnecessary things, etc. We saved a ton of money with these little changes — it does add up!

    Good luck! Recognizing the issue is a good first step, but you really need to take the next one. Stop dining out, cancel cable if it will lower your internet bill, switch to a lower-cost cell phone provider, find ways to have fun that don’t cost you any money, examine ways to lower your utility bill with small improvements (caulking up all the leaks in your house, insulating your garage, turning your thermostat down a degree, installing a programmable thermostat).

    Yes, earning more money is going to make a big dent, but cutting your spending sometimes is painless, and it sets you up for a less spendy lifestyle even when your income increases.

  21. MamaofFour November 13, 2013 at 11:25 AM

    Cut your household expenses. You can do it. Cut the cable. You don’t need to have it. Turn down the thermostat and dress in warmer clothes and add blankets to the couch. Can you lower your car insurance by upping the deductible? Are you paying for water? Shower every other day to cut the costs a little on soap, shampoo etc. Don’t go out to eat or do any extras except maybe one date night a month. Find ways to cut your grocery budget. It’s hard to give much advice w/o seeing your budget. Call your CC companies and ask for a lower interest rate. Can you refinance your home? Good luck. I’m sure you will get creative and find a way to get to where you want to be.

  22. Mistress Susan November 13, 2013 at 12:02 PM

    INCREASE YOUR INCOME. I have lost 60% of my income over the past 3 years, and I live a minimalistic lifestyle: no car, 525sq ft condo, 6 pieces of furniture, etc. Therefore, there is NO such thing as “decrease your expenses” because nobody has zero expenses. Because I thought about doing a loan modification or short sale (can decrease credit score by 300 points) this past summer, the federal government offered FREE financial counseling to review my case. After talking to 3 counselors over 3 months and getting great, in-depth free counseling, they all said the same thing: At the end of the day, sometimes the ONLY solution is to INCREASE YOUR INCOME.

  23. Cat Alford (@BudgetBlonde) November 13, 2013 at 12:09 PM

    I totally agree with you, J. I would have never paid off my credit cards without working my tail off on the side. Most people will say they don’t have time or another list of excuses. The thing is, working your ass off on the side doesn’t have to be a permanent life sentence. She and her husband can each take on extra gigs (newspaper route, cutting grass, shoveling snow, tutoring, babysitting, etc.) until they build up a big ol’ emergency fund and a big ol’ renevation fund. It might take 1-2 years, but then they can quit the extra hustle if it takes up too much time and enjoy the cushion.

  24. Brian@ Debt Discipline November 13, 2013 at 12:20 PM

    I agree with try and boost the income. Maybe put the home remodel on hold and use that cash to pay extra on debt to knock it out of the way. If the house is livable just deal with it for now.

  25. Ben @ The Wealth Gospel November 13, 2013 at 12:36 PM

    Increasing your income is great, but the main thing you want to make sure you’re doing with that is not increasing your expenses to go along with it. If the point of increasing the income is getting out of debt, you have to make sure that’s where it goes. And as limiting as cutting expenses can be, I still find a lot of value in doing it. I’ve seen people who spend hundreds of dollars a month on extra stuff they don’t need. So make sure to evaluate the spending too.

  26. Blake @ BeanCounterByDay November 13, 2013 at 12:40 PM

    I absolutely agree with J. I am always looking for extra ways to increase my income. However, if that isn’t possible, I can offer up the quickest way I know to save $50 a week. Start making your own lunch, and take it with you to work.

    Like J said, it’s hard to give great advice without knowing all of the facts, but eating out is a MAJOR budget killer. So that’s where I’d start.

  27. SavvyFinancialLatina November 13, 2013 at 1:26 PM

    Not knowing exactly what you pay for, and I can’t say much. But i do agree that looking at your expenses and figuring out what you can cut is the easiest. Then you can concentrate on earning more money. Maybe you have cable? Cable can be replaced with an antenna and a subscription to Hulu or Netflix. Maybe you can get a better electricity rate? You can increase your income passively by adding a roommate to your home. This is actually something we want to look into once we get a house. I’m hoping we can rent out one room. This way we can increase our income a bit. $300-$400 makes a difference.

  28. EL @ MoneyWatch101 November 13, 2013 at 1:28 PM

    I agree with all the advice but you have to do something drastic now as you have a ballon payment coming up in 2 years. Sometimes when you are in a situation you cannot prioritize effectively. Never do a renovation when you have debt or when you have a balloon payment coming up in less than 3 years. Option 1 -Refinance now with any savings you have because losing the house is financial disaster. Option 2 – If you can’t refi, stop all retriement contributing, and get part time jobs, save up all this money to get rid of balloon issue. Option 3 – Sell the house and get a new one without a balloon, see if you can get a straight 15-20 year mortgage. Take a small loss on the current home to help you avoid losing it. Also with all the options you must track every penny and increase income to help achieve multiple money goals.

  29. Sarah November 13, 2013 at 1:37 PM

    I’d encourage you to stop the home renovations. Rethink every cost associated with that project. Some things are urgent, take care of those, and some are not. You get to choose, since it’s your house. You can do it! Your combined income is great, and you guys can totally make it. The most obvious ways to cut bills are to nix cable tv, to hone down your cell plans, to cook more and eat out less or never, to drive less (this is big for me–I pay a ton in gas), and another helpful thing is to air dry your clothes. I cut my electric bill $50 a month by line drying clothes (I have a family of 5 so we do a ton of laundry). I was shocked when I saw that next bill. Also, I second the tips to turn down the thermostat and wear more clothes. We keep our house in the low 60s, and it is working fine for now. Deep winter will be harder, but that’s ok. Better to save a little now to make up for those higher costs later. Good luck!

  30. Brooklyn Money November 13, 2013 at 1:49 PM

    I agree with the posters that said you are trying to do too much at once and also with TimRiggins who said put the renos on hold. Focus on one goal at a time, like paying down your student debt which is costing you interest every day. Also agree with posters who said try to consolidate and then refi mortgage at a lower rate.

  31. Adam Hagerman November 13, 2013 at 4:27 PM

    Wow! There are certainly a lot of helpful people here!

    Personally, I like to help people focus on one thing at a time, similar to what Anthony was talking about above. Set financial goals, take a good hard look at your current situation, get on a budget, save for a small emergency fund and then get the heck out of debt! Do those things one at a time. If you click on my name above, it will take you to my 8 Steps to Financial Freedom.

    You should also try and stop accumulating more debt. By that, I mean stop renovating the house unless it’s a true emergency (like no windows in the house). Then refocus all of your income on attacking your debt. Earning more income wouldn’t hurt either!

    I would also recommend that you take a good hard look at your current 401(k) contributions. For those in debt, I usually advise them to reduce their contributions down to the level where they are getting at least the full matching contributions. Free money for your retirement account is great! You just need to be careful regarding vesting in the account. If you’re not going to be at the company long enough to keep the matching, you may want to consider stopping your contributions entirely and use that extra cash to attack your debt. By paying down your debt, you’re getting a guaranteed rate of return. That’s something that you cannot get in your 401(k).

    Good Luck!

  32. Kim@Eyesonthedollar November 13, 2013 at 4:29 PM

    I would agree with lots of other comments to stop the renovations until you feel like you have things under better control. Making a few hundred dollars a month in extra income would be huge. Are there things around the house you could sell? I’m not sure what your jobs are, but maybe there is a way to add an extra day or shift? Otherwise, there might be seasonal retail options. We live in a small town, but many of the stores still hire extra help until after Christmas. If you are good at cooking or if you don’t mind doing set up and cleanup, there could also be opportunities in helping with company holiday parties. There are always ways to make more money if you are motivated enough.

  33. Jacob November 13, 2013 at 8:57 PM

    I’m probably sharing more than I should here, but I make less than you two by about $10k) and my mortgage is more than 3 TIMES THE SIZE of yours. I put 6% away (401k), and barely have enough to get by, but we do. Here’s the key:

    TRACK. EVERY. DOLLAR. Keep all spending on your credit card and sign up for to see where you money is going. I guarantee with your income, there are several hundreds of dollars of leaks in your budget, money that is going toward stuff that you don’t really care about, and money that SHOULD be going toward your goals instead.

    Our budget is bare bones, because we can’t have any extra fluff in there. No cable, internet for $45, very eco-conscious with utilities, drive cheap cars with liability ins. only, no car payments, $500 for food (including toiletries and eating out) for our family of 4, cheap cell phones, no clothing budget, spending cash only $60 per month, etc. And I’m still shelling out $500/mo for health insurance for my fam. UGH!

    We live VERY well, but only because we know EXACTLY where every dollar is going, and make sure not one escapes! It’s easy to start, just use I know it seems overwhelming, but this one step could change your future to the tune of tens of thousands!

    If you need specific help, I do detailed budgets for people on my site, under the heading “Budget Fridays”. Feel free to check ’em out to gain some inspiration, and get a few ideas for how you could direct your money. You’ve got this!

    1. J. Money November 15, 2013 at 11:46 AM

      I’m glad you chimed in here because you have PLENTY of background experience to know what it’s like to be on the other side of the coin. So thanks for doing that man, means a lot.

      1. Jacob November 15, 2013 at 2:00 PM

        Happy to help :)

  34. Christine @ ThePursuitofGreen November 14, 2013 at 12:30 AM

    Perhaps go through everything once more to make sure there isn’t anything else to cut, then focus on increasing income! There’s a lot of good advice on here. I don’t what else to add haah. Do what you feel like:P

  35. JZ November 14, 2013 at 2:11 PM

    It would make a lot of sense financially to sell your husband’s current car and downgrade to a reliable slightly older $4-5,000 car and apply rest of the money to student/other loans. Better yet, don’t buy another car if you can get by without it. BOOM. That should get rid of a lot of the loans and then aggressively attack it until it’s all gone.

    From there, use the money you would normally use to pay off student loans and the car loan towards savings. Soon enough, your savings will grow and you don’t even have to adjust your lifestyle at all (minus the fancy car)!

  36. Lanny November 17, 2013 at 12:47 AM

    Hi everyone! Thanks so much for the input! It’s so awesome to have a community of people willing to pitch in with their own success. Fresh eyes make all the difference!
    I’m 30 and my husband is almost 37 (with sterling credit, I should add) so I know we’re not ridiculously late to the game, but I as a nanny-turned-teacher-turned-travel professional, retirement investments feel like a luxury (like the health insurance I grew up without) we can’t afford to go without. I started deferring 8%, but bumped it to 10% because I WAS accustomed to a once-monthly payday of $1100 as a private school teacher and would rather go without NOW instead of later.
    I calculated the numbers today and discovered that, while we appear to have a generous income to work with, we net closer to $56,000 per year than the $74k gross salary. As a result of those lousy mortgage rates, we pay just under $1,000 per month on the loan. Because of his superb credit, my husband’s auto loan is under $200 for a 2008 vehicle – I own my 2003 vehicle outright and having one completely reliable vehicle is a must for us – I work 40 miles from home and spend $50 per week on fuel. Fortunately, I found out that this will be changing soon and I’ll be free to work remotely, cutting that cost entirely (and the full coverage insurance I require for my vehicle)
    At the risk of sounding gross, I feel like I should also add that I am in the habit of showering every-other day (at most) already .. as a curly-haired gal, I can’t wash it more than once a week anyway.
    I should also link to my home renovation blog to give folks a sense of perspective on what kind of work we’d be “putting on hold” and what the quality of living might cost:
    Without going into details, I’ll mention that I knew exactly what happened with my credit, but I just didn’t have the energy to pursue legal action after all I’d already been through.
    I’d love to rent out a portion of our house, but as you’ll notice from our blog, I’m disinclined to believe it’s a real option. Since replacing the furnace, we have noticed significant savings in our heating costs. Because of our history with the old furnace, we are in the habit of programming it to the lowest possible setting while we’re away and only “crank it” to 65 when we’re home and reduce to 60 for bedtime. We’re big on extra layers and socks.
    I guess my fear stems from my experience of periods of deep financial hardship – as a child, my two sisters and I shared a single bed in the back bedroom of my great-grandmother’s house after we moved from Orlando to Spokane, WA because it was the only room with heat. The following spring, insulation and other essential upgrades were immediately implemented to ensure we had adequate amenities for, y’know, living, but I’ll never forget the ice on the inside of the windows.
    As someone with that background, I would suggest that I’m anal about my spending and err on the side of caution for all monetary issues. We have a plan to refinance soon as soon as I’m able to sign on the loan. I’ve started utilizing all the resources that USAA has to offer so that I can track my spending and identify where we need to trim things up. I keep track of both of our credit scores and spending habits with Credit Karma and Mint as well.

    If anyone has any additional ideas, I’m all ears!

    Many thanks to all the readers and to J for facilitating this conversation!

    1. J. Money November 19, 2013 at 5:01 PM

      Glad this helped, friend!! Thanks so much for being open to me sharing it with everyone and getting feedback :) It’s what helps make this blogging world of ours so GOOD. Real life situations from real life people!

      Please keep us updated as time goes on. And good luck!

  37. Dollar Flipper @ Flipping A Dollar November 17, 2013 at 6:46 AM

    I know the restoration is nice to have, but of were you guys if focus on debt reduction now instead of construction to the house. This would be a twofold increase because you would not only have more money (since you wouldn’t be spending it on building materials), but you’d also have more time which you could then spend hustling like J Money talks about! You guys seem overcommitted right now!

  38. Justin December 10, 2013 at 11:59 PM

    Consider breaking your cell phone contract and switching to a cheaper pre-paid option with an MVNO carrier that uses the same network as your current carrier. MVNOs charge WAY LESS and give you basically the same cell phone service.

    Ting’s good and so is Republic Wireless–just a couple of my favorites based upon my own and friends’ experience.

    I was in three cell phone contracts with Sprint but didn’t want to pay $670 of early termination fees for breaking my contract. Then a friend suggested WHAT?! That exists?

    Yes. They broke my Sprint contracts, saved me the $670 ETFs, and now I’m saving even more with a $25/month plan from Ting (I had been paying $175/month).

    Go get ’em, girl.

    1. J. Money December 12, 2013 at 9:17 AM

      Wow, great idea for a site! Switching cell phones and carriers are just no fun at all, but you’re totally right it can save you some major bank if done well… Funny how we’re all so used to paying $100+ with our fancy phones when we were just as happy with old school candy bar styles at $30/mo back in the day :)


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