I don’t explain things well sometimes, so I hope this clears it up

It won’t be a 401K loan, first of all because it is not 401K money, it was rolled over money into an IRA years ago. Second of all it’s not a true loan in the sense of the word because we are simply withdrawing from our savings/IRA because we are old enough to withdraw without penalty or a loan to be required (dh will be 65 in Feb and I’ll be 63 on the 6th of this month). We are simply referring to it as a loan in our minds because we don’t want to spend the money willie nillie once it is all worked out. The term “loan” in this case means we are loaning ourselves money in order to flip the budget, but as soon as it all smoothes out we will be putting the money back into either a mutual fund, or if I qualify to still be able to do so an IRA so we could take a tax deduction for upping my IRA—IF we can legally do that. Got to check the laws on that.
The “making money” part is because once all the flipping of the budget is completed and smoothed out we will be paying all our interest bearing debt two weeks early each month and since the interest is figured on the average daily balance it will bring the amount of interest down a miniscule amount in the long run. Also IF we can legally do the deposit into an IRA for me with the repayment money then there might (if congress doesn’t do away with that deduction) be a tax deduction for putting the money back.

When I first started working for the school district

every new employee was offered a 500 dollar interest free loan to help defray the cost of not getting a paycheck right away. I took it and they took 100 dollars out of my paycheck every month for 5 months.
But, I guess it might depend upon other things such as job security and whether it would cause stress with the owner. In my case, there were thousands of employees so there was nothing personal at all there. And, it enabled me to pay my bills that first month.

I wouldn’t have took

that she meant you were going to make more money like per hour or yearly, but that because your husband and son would be getting paid just twice a month instead of every 2 weeks, the paychecks will be larger every paycheck because they will be getting paid 24 times a year instead of 26 times. So those 2 “extra” checks would be added into other checks. I am sure you have already figured it, but for some who might have gotten confused; for example if a salary was 50,000 a year and a person got paid biweekly then the check would 1923.00 every 2 weeks, but if they got paid just twice a month then the check would be 2083.00 a pay period (before taxes, insurance, etc). I think that is what she meant by they would be making more.

I think things like this is why Dave mentions in his new FPU class that just because you live on a zero based budget does not mean you should have zero in your checking after everything is paid. That you need to have a cushion in there.

It’s cool that you have an alternate plan,

but setting up a payroll loan is a pretty standard practice when a company screws around with paydates. Happened to me twice. One time everyone got the loan automatically, the other time we had to ask for it but it was routine. That was last year and they held back the first week in January which of course is when many people are feeling it.

That comtroller does sound off the rails, good luck with that!

Best believe….

I won’t be going through any hardships with my paycheck from my own company! And if I’m not going through any, I won’t be putting my employee’s through one either. The thought of changing paydates just scares me from an owner’s perspective. There are too many federal and state deductions I have to do and the risk of screwing those up doesn’t interest me in the least. I don’t want the IRS, KGB or any other three letter organization coming to look for me- the buck stops with me.

In the long run we should come out better

off because with me paying two weeks early on all the interest bearing accounts we should save a little on interest and maybe get a little ahead of the game on paying off the cc.
Once the flip flop of bills is done then we should be able to put the money back quickly—IF Murphy stays away and if he doesn’t all the more reason to not take out a loan from the employer.. I seriously do not want or need any more debt to worry about.
Dh understood them to say that they weren’t taking the ss pay hike out this pay period, but ds says she said it would come out, but not the other new taxes yet. I sure hope they don’t screw up our ss with all this moving around of funds.

Well the change in pay dates

was the brain child of the comptroller and she insists that NO ONE could possibly be inconvenienced by it that everyone will just need to adapt their lifestyle and attitude for just a week or so and it won’t effect anyone’s bill payments. That their pay checks are all miraculously going to go up and this will keep everyone from feeling the pinch of the new taxes. And yadda, yadda, yadda. Give me a break. If I didn’t have an accounting degree I might have fallen for her bs, but I am a numbers nerd and what you get paid an hour is what you get paid an hour and nothing is going to keep you from feeling the tax hikes. If your bills are due on the 15th and the paycheck gets moved to the 22nd it will definitely change how you have to pay your bills out of what pay check. Ds is a numbers nerd too and he said it was all he could do to keep from calling her bluff. Some of the people just set there going ohhhh, ok. Ds said they were the same ones who whip out a credit card for everything.
The owner on the other hand was hugely apologetic. He asked who all was going to have financial difficulty with it and while several muttered and carried on none but dh and ds raised their hands—during the meeting, others confided they were definitely screwed financially after it. He offered to delay the plan for a month or so and everyone, except dh and ds said that wouldn’t make a difference. It would have definitely made a difference for us. It’s called BUDGETING. But the comptroller wants nothing to do with delaying—she’s new and a bean couner. I have a feeling she won’t be with the company long because she’s pissed off a lot of folks already, and not just the flunkies.
After the meeting the owner went by dh’s desk and called ds over and apologized profusely to them personally. He said that he too was going to have problems with autodrafts and such with this short turn around that they had actually planned on doing it last Oct and decided then it was going to cause hardship and decided against it but the comptroller insisted it HAD to be done in order for her to do her job properly. He said he and his wife were going to be scrambling to get everything readjusted and he appreciated dh and ds being honest enough to admit it was going to cause a problem when no one else was brave enough to do so.
Dh told him if they had done it in Oct we would have been fine because we wouldn’t have taken the vacation and used the bonus money to pay off two bills, but now it was going to mess us up for a month or so big time. He asked dh just exactly how big a problem it was going to be. Dh told him we work on a zero based budget and that since we had previously had no warning we were going to have to come up with enough money to pay 1 ½ months of bills out of a one month pay check in order to pay our bills on time this month and in the future months. That because we use no charge cards that it was creating a bit of a problem. The owner asked how much that was and dh told him the amount. The owner offered a loan to be paid back over 3 months. Dh said he’d talk it over with me and he has to let them know first thing in the morning.

I don’t want to borrow from the company, and neither does dh. We discussed it heavily, I talked with some people off list about it and we all came to the same conclusion. Borrowing money from your employer is not a smart thing to do in more ways than one. I believe DR even preaches against it.

So our game plan is to withdraw from the retirement mutual fund—which we can do without penalty as a “loan” to ourselves. Then the payments we were going to have to make to the employer we make to a savings account instead. Then use that money to purchase me an IRA later this year. I think I’m still young enough for a roth, I’ll have to check on that. If I’m not then we’ll simply re-invest it in a non-retirement account.

Thanks for everyone’s advice.

We do have one child (7 years old). And, while we’ve put some money aside for her college, it isn’t nearly what we need to have. So, I think I’m going to start knocking down the car debt. It was a really stupid purchase and I’m mad at myself for having it. But, since all the other debt will be paid off by the end of this month, I should be able to take care of it fairly quickly. Then, I’ll start on the super emergency fund.

I don’t know if I actually agree this time

It is possible to have a lower payoff date on a house versus the car depending on when you purchased the car. If you were debt free except for the house when you purchased the car, its possible. If you’re that close to have either the house of the car paid of, I don’t see anything wrong with the house being in BS2. Everything after its paid off then goes into wealth buildng-unless you have children in which I would continue with the steps, bypassing the pay off the house step.

I’d pay on the car.

That’s what Dave recommends to. All the bills including the car, then the build up to 3-6 months of bills in savings
then the house.
That being said, I’m such a security freak I’m adding to my savings a small amount each month as I snowball. So I currently have about $2,500 in savings–about one month of our bills. I add 1/4 of any extra money I make each month to the savings account. I know it slows down my debt reduction, but I NEED that little security, especially in today’s economy. If I’m looking at the baby steps correctly, put the money on the car loan, as you are still in BS2 as long as you have the car loan.Paying off the house is BS6, although I like the way you think. Owning your home free and clear is tempting. I think I’d want to move that to BS4, once the EF is fully funded–6 months worth of expenses. My 2 cents.

What do y’all think?

Over the last few days, my hubby and I have learned that he will be getting a nice bonus at work. We also got some “surprise” money on an insurance settlement. With those two checks, we’ll be able to pay off the last of our debt with the exception of my car and our house. We have the $1,000 emergency fund in the bank (it’s actually about $1,200) and we know that my husband’s job is secure.
So, my question is….should I take the money we’ve been throwing at paying off the bills and put that towards the car and the house? Or should I add to our emergency fund and keep paying what I have been on the car and the house. At the rate I’m going right now, my car will be paid off in two years. The house will be paid off October 2010
I have to admit, the thought of having the house, car and all bills paid off is mighty tempting. At the same time, I like the idea of having a cushion in the bank.

Ok, so I called our broker

and I gotta say I love the way he talks directly to us instead of around and above us. That and the great way he’s handled our accounts since 1988.
I first asked him about the age limit on putting into an IRA. Answer 70 ½ so we’re covered there. If I wanted to add to an IRA this year I could and both dh and I will still be young enough after we are debt free to do so, which we probably will. Dh is having 401K taken out of his paycheck at the max they’ll match right now even though we are still on bs2 because we are so close to full retirement (about 2-3 years max) and want as big a pad in there as possible before he does retire.
Right now the planned schedule is to be totally debt free including the house by mid 2015 at the latest. Then him work until spring 2016 for us to build up our ffef and retirement fund. Hopefully by late spring 2016 we’ll be traveling a lot.
After he explained that to me I told him what had happened with the pay check. His first words were, “that is such a poor business move on their part.” I agreed, but told him it had been done and now I needed to flip our budget to match the new paydays so I was calling him for counsel. He asked how much I thought I’d need to reverse the budget. I told him and he said “no problem, you have that and plenty more.” I also told him my thought about getting an IRA later in the year to “put it back”. What he told me next really surprised me. Because of the level we are at in our age we can actually withdraw the money tax free for 60 days and as long as it is put back within the 60 days it will be as if it never left the account. How cool is that? He said if we didn’t get it in within the 60 days it would be the normal tax rate, which would be the same tax rate as taking a payroll advance. He also said that he would not recommend taking a loan from dh’s employer. He thought my plan was a far better financial move on our part.So today I’m playing with numbers AGAIN and my calendar to see how long I can go without taking the money out of the account to do what we need so we will have that many more days to adjust to the new pay schedule and to put the money back and avoid the tax hit. Even though there would be no penalty, we still have to pay taxes on it like the rest of the world.
I’m also looking at ways to try to lower that amount needed to make the 60 day return a certainty.
Dh’s paycheck finally posted and it was higher than I had budgeted for because it had an extra day of pay on it, but his ss was on there so at least I don’t have to worry about them trying to make up the difference later.
So it’s all working out like I knew it would eventually, and hey you never know it’s about review time, so maybe with the payroll “savings” the boss will up the guys salaries. (wishful thinking). LOL!

Hm, how a bout a new year’s resolution that you work together on getting engaged and resolving any issues?

Asking that you write everything down sounds loaded to me because , well, it’s what you want her to do and you don’t have a corresponding problem, so it’s sort of you telling her what to do in disguise. At least it might feel that way to her.
I think there’s a bigger discussion here. Can you two have a ‘non-date’ night, hire a sitter to take the kids somewhere, give you some space to work?
Right now this is *your* burning issue. To get from here to “what do we need to build *OUR* future together” is going to take both of you talking about what you want.

You all make good points.

Instead of that email that I drafted, I wrote another one where I basically ask her if we can have a new year’s resolution where we are completely honest and open with each other regarding what we are spending money on. I proposed that we write it down for each other to see and we will do so without judgment for January. At the end of the month, we can sit down and discuss where our money went and how we feel about it.
This is the core issue – the lack of communication and treating our money separately. We decided to do that long ago because she had a bankruptcy and did not want to ruin my credit, but I think that now that we have a family, it is time to start thinking differently. I hope that she will agree. I’ll send the email (both of us do better starting hard conversations in email partly because we don’t won’t to argue in front of the children). After the email, she will either reply back by email or talk to me in person. It will be okay because I was careful in how I worded things.
If we have trouble navigating through this, I will consult a couple counselor, but I am hoping that we can do it. My issue that I bring to this is that I hate conflict so I avoid these kinds of topics because I am afraid of how she will respond. But, if I can push through my fears and start the real discussion, then I am hoping that we can come to some conclusions together.
I think that I may look into getting the financial peace DVD. We are so incredibly busy that we would not have time to go and would not have anyone to watch our young kids anyway, but I think that she’d be willing to watch it with me.

Hi Lavada,

It sounds like you two need to have some very serious conversations. You can start by emphasizing that you want to build a stable permanent
future together. Have you considered pre-marriage counseling, or going through FPU together, or something? You’ve got a temporary arrangement right now and to combine for life you need to be on the same page about money.
DR was talking about Christmas spending on recent podcast. The desire o be a giver comes from a generosity of spirit, but you don’t want to have your holidays lead to a “financial hangover”. You want everyone to be able to wake up the next day and feel that it was a great holiday with no regrets.
About the email – I would write it all down, but think about how your partner best communicates. Some people like getting the distance and space you get with email – I am one – but other people find it cold and can feel blindsided. You know your partner the best, what’s the best way to have a serious discussion with her ? And also be open, because after 15 years she probably has her own set of concerns. You want to have space to let her bring up issues too, but be able to take one thing at a time without it turning into a fight.

I really liked John Gottman’s book “the seven principles for making marriage work”. It’s also good to have a counselor or pastor lined up to help, because once you start churning up emotionally laden issues it can get heavy fast.

Given the types of disagreements that you are having,

I would suggest that this isn’t a single conversation about how she spends, either spoken or written. Have you considered relationship counseling? If you two want to get married, I think working out these differences now would serve you both very well. Disagreements about money are one of the top three reasons marriages split up. My DH and I have been in marriage counseling for about 18 months now and every session lately we’ve been having aha! moments for why we do what we do. There’s no blame, there’s no guilt, there’s no “you should do things my way, just because”. We are learning who we are, and why we are, and how to change some of the programming we’ve gotten along the way by well-intentioned but also wounded family and friends. I fear that without something deeper like that, you’ll simply continue to have conversations where one or both of you are really frustrated with what the other is doing. Or worse, NOT have conversations. Consider DR the canary in the coal mine – the canary can tell you that something is wrong and needs to be resolved. But the canary can’t fix the problem. I think you would be very well served to seek out some deeper resolutions to how you and she can work together to build a life together. If it’s you and she both trying to impose your own way of doing things on the other, you’ll be having these same conversations for the next 20 years. Been there, done that. Ain’t much fun. But once you start seeing how we bring some unknown assumptions to every decision, and how to change those assumptions, things get a lot easier. Not easy, but easier.


I’ll step up and say something I’ve said before on this list. Sometimes it’s enough to go through the DR class to get a couple back on track financially. But sometimes DR simply reveals deeper issues between how two people (doesn’t matter the gender) work with stuff like money. I know from my own experience being married now twice, my first partner had a very simple strategy – spend it all. That marriage lasted quite a while before we finally threw in the towel because we were tired of arguing all the time. My second partner and current very-much-loved DH, has another relatively simple strategy – save it all. I’m trying to run a business where money coming in and out is like the flood of blood through the veins. It’s gotta move to be useful. So simplistic money management strategies weren’t working anymore. Tack on top of that the fact that I went through my divorce and picked up a number of “oh my gosh we might not have money tomorrow so use it today” habits, which I’m still unlearning, and you’ve got a recipe for financial mis-management on both sides that will never ever agree. Not without some stronger tools and deeper understanding of the mechanisms involved.

So, those of you that remember, I am the one with the partner who has been overspending.

We had a discussion a couple of days ago about new year’s resolutions and I shared mine about finishing paying off the credit cards this year. She discussed other things, but not finances. Then, she told me that she was working on paying off her cards and was making progress. At that point, I asked her about whether she had been using her credit cards and she denied it. I then said, “Are you sure because I can tell that you have been spending more money than you have?” At that, she told me that she has used them a little bit for Christmas, but not much.

So, I logged into her account this morning (I have the password because this is how I manage our joint checking account) and looked at her credit card activities for her one card. I calculated out $3400 dollars in credit card purchases since August. Granted, she is also paying 600 a month into the balance, but the total balance has gone up by about 2000. She did have nearly 1000 in car repairs as part of that, but she did not have enough savings to cover it because she has gradually windled down her 1000 that she had saved.

So, I am tempted to put all of this into an email that I send to her, partly because I have no idea whether she lied to me or whether she is just not aware. Like I said, she tends to be in denial about these kinds of things. She also told me that my constant worry about spending money took some of the fun out of Christmas for her so it may be that she was lying to me because I have been doing a fair amount of nagging when I see her buying things such as the recent laptop, running shoes, and kindle. I also complained some because we bought two expensive things for our 6 year old son, meaning that we were not able to stay within the allotted Christmas funds this year. Don’t get me wrong, I wanted my kids to have a Christmas, but I was working on finding really good used deals in places like E bay.

Of course, another issue here is that I feel guilty for looking at her personal credit card account and she may be upset at that. And, I do not have access to her other credit cards so I really don’t know whether she has put more money on those accounts either.

Why the email instead of in person? Well, it is so that both of us can have some space in a possible heated discussion. It also allows her to think about how she wants to respond before she responds. And, I tend to get really angry if I think that someone is lying to me so it would allow me the same kind of distance for thinking first. In my life, I’ve learned that I can regret what I’ve said in anger and it is not always easy to take it back. I truly do care about her and want to do this in a way that allows her to preserve her dignity, but also in a way that she can at least be aware of what she is doing.

Maryland just passed a law that same sex couples can marry, but I very much hesitate to do this until I feel more confident with the financial side of things. In all other ways, we truly do live as a married couple and we do own a house together so we are somewhat tied financially. If she ends up in bankruptcy, I’d be in trouble too. But, we have been friends since 1989 and a couple since 1996 and we do plan on spending our lives together. We are raising two children together. It would be so nice to feel confident enough to go ahead with this.

So, what do people think? Should I go ahead and risk sending her an email? Any ideas on what should be approached? Any wisdom from anyone who has done something similar?

My only debt

other than the mortgage (and my mom’s mortgage) is the car – and I’ve set it up so that my car will be paid off this month.

I also already have a FFEF in place (6 months) and then some.

I think my problem is that I never really did have credit card debt – so I don’t have those snowball payments that can now be applied to retirement, college savings, etc.

Most of my savings was socked away when I lived wayyyy within my means (in a smaller, older home in a cheaper area). Now that I have a much higher mortgage, higher utilities, my mom’s mortgage, a growing child, etc. –
it’s hard to put money in the bank. Thank God I did it when I had it though.

Emma, How far are you with your snowball?

You on step #2? Will you have more wiggle room after step #2? I did not realize DR said don’t count the 3% match as far as your 15% contributions. Right now Im on step #3, then Im going to plan on bumping mine up the same way as yours. Right now my wife does 6% and I do 6% until we get the 3-6 months of living expenses up.
Your doing good so far with your 401K though, you’re still young =).

Since it is in your maiden name

it will take some time to research this but don’t give it up. If you want roll over information, check your bank or Edward Jones or another place that you can trust. You will have to have the paper work done before you can do much other thanresearch it.

ACK! I’m struggling here..

Here’s a quote from TMMO, “When calculating your 15%, don’t include company matches in your plan. Invest 15% of your gross income. If your company matches some or part of your contribution, you can consider it gravy. Remember, this is a rule of thumb, so if you cheat down to 12 percent or up to 17 percent, that is not a huge problem, but understand the dangers of straying far from 15 percent.”

Based on that statement, what do you contribute to retirement?

As I mentioned earlier, I contribute 8% to a 401K (using Vanguard) via my company. My company contributes an additional 3%. Dave says not to count that 3% – BUT I WANT TO! WAHHHH!!!

I am considering opening a Roth IRA and contributing 4% of my income which would be a total of 15%, if you count my company match – 12% if you don’t – which Dave says is “not a huge problem”.

Should I feel ok about that? I need more info about bad credit installment loans direct lenders, pleas only DIRECT!! It does still add up to 15% – so why do I feel so guilty?

I just want to have enough wiggle room to do other things – like save $2K/year for my daughter’s future, work on saving for the patio/sunroom, have the flexibility to do the things we like to do. I keep working up a budget but struggle with so many different things….(sigh)

To give you some more background info, I’m 33 years old and have about $45K in my 401K currently.

Saw this article on the BBC News website

It talks about how a number of European countries are either passively or actively phasing out cash transactions for a variety of reasons. It mentions the United States in passing. I switched over to a cash-basis a number of years ago as part of the FPU classes I took; I would really rather not switch back. I was saddened to see that many people don’t want to use cash, and think it should be phased out, specifically because it requires budgeting for various expenses in advance.

Since your mother is already having issues about not understanding contracts

I would get a durable poa. Not just a plain one, but a durable one. This will protect both you and her. All creditors will accept it and talk to you then. You will need one for each parent. DO NOT ADD HER NAME to bills in just his name. Creditors will not be able to touch her for debts in his name only if domething hapoens to him.
A durable can only be changed by the individual if they are of sound mind, ir a court rules it dissolved. I won’t go into why this can be very important with my horror story. Just know it will protect all concerned.

Hi everyone

So in going through a bunch of cards and bills from my parents, found out they definitely have more than 2-3 credit cards. lol. But still, they are all paid off. They are definitely of a generation and mindset that was pro cc’s. But again, there’s not debt there. Or at least I haven’t seen it yet.
I realized I didn’t frame my question entirely correctly in my previous post. My other question about paying their bills etc is that my father’s name is currently listed as the primary person. In some cases my mother’s name isn’t there at all, though she may be authorized on the account. I think that is/could be a big problem.
Last month when I helped her pay bills, I ran into a few challenges when I tried to change something because he wasn’t available to confirm the desired change.
Am I correct to think we need to put these accounts, like utilities, in HER name or at least add her? Or should I just worry about getting POA? If I understand right POA would allow me to change whatever needed to be changed, and not worry about whose name is on the account.

Advice appreciated.

We have had 2 cats with health issues, one similar to yours

It is usually cheaper in the long run to feed the proper diet than to deal with vet bills for not doing. Feeding the proper diet may not prevent office visits but it helps. Something like it’s better for us to do maintenance with our health rather than ignore it and end up in the hospital.

You may want to ask your vet if there are any coupons or discounts for the food. Explain that you’re trying to work with your budget and it would help greatly if you could get some kind of coupon or discount.