Monday, July 19, 2010

Taking responsibility for our Debt

Author’s note: When Shelle first put up the list of topics that she wanted guest contributors for, I thought about taking a chance with them. See, I love writing. I have my own blog; My Life, My Glory. I’ve been blogging for four years. But the thing is, I mainly write for me, myself and I. I don’t write in my blog for everyone else. So I talked myself out of contacting Shelle with my thoughts on one of the topics. What changed my mind? I thought that maybe, just maybe, I might be able to help one person or make one person realize that she or he is not alone. Doing just that makes it worth something.

I have been a wife for four years, a mother for six years and a SAHM for four years. You need to know that I am a little old fashion when it comes to one thing; I believed because I was a SAHM and not bringing in any money in to the home, it was absolutely none of my business what my husband made, how the bills got paid, etc. (Haha, yes, it’s 2010, I know this). This doesn’t mean that’s how I felt about other SAHPs.

Before the economy went down the crapper, we didn’t care much about watching what we spent and when we spent it. My husband is the VP of the company. He makes a great income. He had some debt, but nothing that was extreme and nothing that wasn’t difficult to pay off. Shortly before Christmas 2007, my husband was up for a raise. We were offered a choice; we could either accept the raise on my husband’s paycheque or we could have the company pay some of our bills so that we could pay off the debt we had without pulling us tight in the wallet. Everything went great. We paid off our debts. We had hundreds of extra dollars each week because our bills were taken care of.

The problem starts when the money controller of the company stopped paying our bills without informing us. Apparently, the original plan had been for the company to pay our bills until the debt was caught up. Once the debt was caught up, they would stop paying the bills and would put the raise on our paycheque. This was not what was explained to us. This continued for three months. We were now behind, by three months on all our bills except our mortgage and car payment. Unfortunately, this is also the time when things were getting really bad in the USA. My husband’s company deals mainly with American buyers, despite us being in Canada. So if there were no buyers for the machines that our company made, there was no money coming in. At this point, I had no idea what was going on. I didn’t know that bills hadn’t gotten paid. I didn’t know that my husband was struggling to catch up on bills. I didn’t think to open the letters coming from the insurance company, the electricity company, the gas company, the telephone company or the cable company. Maybe that was my fault in all of this. I didn’t think. I trusted my husband, trusted that he could and would provide for us.

October 2008 rolled around. I was tired of the constant phone calls (even if I did answer them, they couldn’t talk to me because my name wasn’t on the records), tired of signing for letters that arrived in the mail. I finally opened one. I was shocked. I opened the next and the next. I finished opening all of the bills and was in tears. We were so severely in debt that there was little hope. I was furious with my husband for keeping this from me. I was furious that he would allow this to happen (at this point, I didn’t know what had happened). My anger turned into something else though. I began to think about how my husband was perfectly fine financially before me and my son came along. How he only had a credit card debt before we got married and had a second child. I began to feel like this was entirely my fault; that he would have been better off without me coming into his life. I packed a suit case for me and our children. I was going to leave. I know, drastic, but I felt that this was happening because of me and that he didn’t trust me enough to talk to me about it.

I stayed. I stayed and we fought it out. We had never fought before. Oh, we had arguments and disagreements, but we never fought before. We had a full blown screaming match that ended in tears for both of us. I found out everything that happened. I found out that because the economy in the USA hit a low, that people all over the country and even in our country were struggling, his company wasn’t able to give us the raise he was promised, that he earned, that had been given to him and then taken away. So not only had the company stopped paying our bills, but he had to take a huge pay cut on top of owing thousands of dollars.

Something changed. Something inside me changed. Neither of us apologized to the other. I don’t think we needed to. We both knew that we were sorry. I sat down the next day and went through every single bill. I wrote down what we owed to each company, and began to make a budget. I found out approximately $2,000 dollars of the debt wasn’t even ours, but belonged to my FIL and was in my husband’s name!

Fast forward to now, July 2010. My husband is debt free. All of our bills have been paid off. We were lucky. My husband was able to make payment plans with the companies. It took us over a year to get there, but we did. I have a credit card debt that is being paid off, slowly but surely. In March 2011 it will be completely paid off and that is my debt.

So where is the positive in all this?

1. My husband & I are more open about our finances. He now tells me everything, even if I don’t want to know. He tells me NO when I want something but we can’t afford it (yes, this is a positive because before he would say yes and put a bill on hold). He will sit down with me and talk to me if there is a problem, a potential problem or if he wants to make changes in our services.
2. I have taken over the budgeting. I got over my silly beliefs and became involved. I created an Excel spread sheet with every single bill, every single paycheque and every single extra that we ever want to do. I took the step, one I didn’t believe was my right, and took charge of our finances. If I don’t keep on top of things and remind my husband when due dates are, they can and will get forgotten. If they do, it will be OUR fault this time, and not his company’s.
3. Things got really bad. I almost left my husband. I was ready to walk away from him, from our life that we had built and were still building. I stayed and we worked on, compromised on and fixed things.
4. We have a savings plan now, which is something we didn’t have before. Our close friends are getting married in the Dominican Republic in March 2011. We’re able to actually go. I can look at our budget, figure out how much we need to save each paycheque and do it. If we want to go out for dinner, we can. If we want to buy something for the kids, we can. If we want to take a day trip to a zoo, safari, amusement park, we can.
5. We downsized on things we simply don’t need. We dropped down to basic cable and to a basic internet services. We fixed our phone plans so they made more sense. We stopped treating our family and friends to things and “went dutch” more often than not.
6. And the biggest one in my opinion? My husband is officially debt free. I know that some people can say that, but there aren’t that many who can.

How has the economy affected the financial dynamic in your relationship?

* Alex
My life, My Glory


Shelle-BlokThoughts said...

This was kind of me and my man. Except I was your guy and you were my man. He had no idea our finances and I got extremely overwhelmed.

We have slowly dug ourselves out together, but the economy has fought us tooth and nail.

In retrospect with your situation, it seemed to turn out for the better! You guys were lucky.

Great post girl!

TisforTonya said...

finances give me an ulcer - really. I stressed and stressed and stressed when my paycheck wouldn't cover what I thought it should - and then I spent ten years as a SAHM being told to "stop acting like we're poor" when I would avoid spending ANYTHING extra... unfortunately I stopped acting like we were poor just in time for the economy to tank. So now I'm back to "acting" out of necessity. Does this bring us closer? yeah, probably not, but I'm trying to not let it drive us apart!

Anonymous said...

every partnership should budget TOGETHER and pay the bills TOGETHER. It adds accountability. The SAHM thing is such BS but all SAHM's seem to feel it including my bride. As I have said a billion times before a marriage is just a simple partnership, it should be run like a business partnership.

Also most people who are rich a frugal, folks should always spend like it hurts them to do it. Never spend on frivolous things. Security is much better than tings, it is your and your kids future, spend it wisely.

Anyone checking the time line in her post?!?!
bwhahahahaha I been telling everyone to be careful how they vote!

Mrs.Duran said...

OH MONEY Geez I hate this topic but I know that money makes the money go around! I am SAHM also and my husband works 2 jobs, his police job ( which we all know they get paid crap) and his OT job which is a blessing because we wouldnt make it with out it. He pays the bills, well I write the checks out and give them to him and I will find them two days later in the car floor! We just had this fight yesterday about the water bill! He is the numbers guy in our family always has been but he is HORRIBLE about paying bills! I try and take over but I have no idea what his check is going to be. For the most part he lets me know whats going, tells me what I can and cant buy. We are about to lose his OT job like tomorrow so I am going to go back to the work field and put my son in daycare ( insert sobbing) but I want what you and your hubby have, I want us to seat down and pay bills together ect... It just hard to get out of this habit. So I am hoping when I get a job things will change because then I can have an imput about the money since I am putting money in the accout also.

Elaina said...

The economy hasn't really hurt us very much. My husband is in the Army, so he didn't take a paycut, and we were in Germany when things really started to hit bottom, so we barely noticed it personally. We did notice when we bought a car that we had to pay more down, even though we had good credit, because they were tightening the requirements to qualify for a loan. We planned to pay half down, so even that wasn't a problem for us, but if we hadn't been prepared for that, it could have meant we wouldn't have been able to do it. I'm a SAHM, but I'm in charge of the bills. It makes sense, because my husband is gone a lot, but I'm also more organized and better with money.

Anonymous said...

Thank you for your comments :) I was busy all day cleaning our house (we're in the process of getting it ready to sell).

@ Shelle - In the end, yeah, it turned out for the best. We were lucky. Very lucky. I don't know the statistics but don't most divorces happen because of financial problems? I think I heard that somewhere ...

@ T - They stress me out as well. I've never liked to talk Money with anyone. I'll also never fully understand everything that is involved. I've not a numbers person lol.

@ Sage - Oh sage. Darling. My feelings and thoughts, contrary to what you believe, are not bullshit. Sorry, but they're not. I'm entitled to my thoughts and beliefs, just as you are :P You can disgree with me, most definitely, but you shouldn't call my thoughts bullshit. Other than that little comment lol I disgree with the Business Partnership comment. In my opinion, business partnerships should not have any emtions involved. Bringing emotions into a business partnership causes problems. A marriage should be treated like, shocking, a marriage. It is a partnership, yes, but it's not a business. Not in my opinion. I do however agree that people shouldn't spend their money all willy nilly. They should always make sure necessities are bought/paid for first. The little extras should be just that, little extras and every once in a while have that special treat. Also, you need to remember :P I'm in CANADA lol. We didn't vote for anyone in America ;)

@ 615sWife - Breaking out of the habit is rough. For us, it was either; break the habit or our our marriage would more than likely end. It would send me back into my depression and cause more problems between us. You'll break the habit. You just have to work hard on it. Most people can do anything they put their minds to.

@ Elaina - Thank you for your comment. I think one of the very few people who were not affected by the economy were those in the Army. I mean, can they get pay cuts?

Thanks Shelle for letting my share this post on this blog. I appreciate it :)

Elaina said...

The only way that I know of that a soldier can get a paycut is if they lose rank, and that would happen if they get in trouble. In other words, if my husband got a paycut, I'd be pretty pissed :)

Anonymous said...

@ Elaina - lol, yeah, I can understand that.

nitebyrd said...

Alex, you should be very proud of yourself as should your husband. Finances and non-communication are two major marital woes. You've managed to tackle both with determination and skill. I applaud you.

Anonymous said...

@ Nitebyrd - Thanks beautiful. I appreciate your kind words. How come I haven't heard from you in forever? Geez woman :P