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OK, bear with me...this may be confusing!

November 13th, 2008 at 03:41 am

Hi everyone! Long time lurker, so I know that you all have great life experiences and will give great advice. I don't know where to even start. My DH and I have been together for 10+ years, married for 5. Due to some personal issues, DH racked up 14K in CC debt back in 2005-2006. I was not aware( in denial) of the problems he was facing, and didn't know about this debt. However, things have cleaned up nicely and we're back on track as a couple since Aug. 2006. We've managed to pay about 11K off, but still have about 22K left to go. I had my own debt as well. (We also had a big car repair, and various 'life happens' events occur, with no EF in place)

We now have about 2K in EF. We have 4 jobs between the 2 of us. My position does pay higher, and I have the health insurance for both of us.

Choices to make for now: Do we try to find a cheaper place in our area to live? Rents seem to be going down in our area, but for first, last and security, (plus various moving fees), it would probably run us about 3K. But that would wipe out our EF.

Do we stay where we are, and focus on debt, or try to get EF bigger because…

On October 22, I gave my husband "the best birthday gift ever"---a positive pregnancy test. We are both very excited. I'm about 8 weeks along. I know financially, we're not ready, but I’m 32, and are you ever financially ready for a baby?

He would be staying at home with the baby, so in the next 7 months, we need to decrease our bills the equivalent of his salary. (Usually brings home $800 a month). It's not much, but he does all the household stuff, cleaning, laundry, errands that I can't do while I'm working.

My job is also an issue. I work for a small company, which only has about 15 employees. The boss/owner/president is a real tough cookie. She does not give maternity leave. The last woman to have a baby had 12 weeks unpaid, had to sign some paper that terminated her, and paid COBRA while she was out. That mysterious paper had to be signed that day…couldn't be taken home to discuss with husband (or lawyer). She left with the knowledge that she would be back, and she is still with us. I have 4 weeks vacation that I'll have by June. If she even allows me to take 12 weeks, that would mean 8 weeks unpaid, plus maybe 1K/month for COBRA. Is that even legal? She has less than 50 employees, so FMLA doesn't apply.

So stay put in current apartment, save up 8 weeks salary, plus another 2K for possible insurance? Or try to pay down debt now before baby comes? Too many choices and this first post is too long!

I didn't want to get down to the nitty gritty with actual figures of debt and salaries on first post, but any advice would be greatly appreciated!

14 Responses to “OK, bear with me...this may be confusing!”

  1. creditcardfree Says:

    Welcome!!

    Not sure if you are a Dave Ramsey follower, but he says if you see storm clouds on the horizon that it is time to save for the rainy day. In your case, yes, save for the insurance and 8 weeks of income.

    I'm not sure about the apartment. It depends on how much you could save per month. You'd have to save almost $300 a month just to recoup the $3K to costs to move.

    Congrats on the baby!!

  2. whitestripe Says:

    welcome and congratulations on the good news! if i were in your position i would just save save save as much as i possibly could. pay minimum plus a bit extra on your debt, and try to minimise your expenses as much as possible. Smile look forward to reading your journey!

  3. Broken Arrow Says:

    Welcome. That's quite a plateful for a first post.

    Well, it seems like you guys are doing what you can given the situation. I think the best upshot to all this is that it appears both you and your husband are on the same page. That alone is worth its own weight in gold.

    Moving? Well, I suppose it depends on how long you plan to live there and how much that savings will amount to in the long run. If it will save you a lot more money, and it doesn't hurt the commute, I'd seriously consider it. Perhaps, I'd wait a bit to beef up a separate moving fund first as well, before the move.

    Good luck!

  4. merch Says:

    I would recommend rework the budget for his salary only. Can you still pay everything and remain current? If not, I might move into something cheaper to get the budget in line.

    I would also recommend that you NOT pay down debt. Over the next nine months, I would take those extra debt payments and just put them to the side. You never know what's going to happen. When my second son was born, we had hospital bills of 35k and I had insurance.

    So again, I would save the money will keeping current. Once you and baby are OK, I would roll that to debt reduction.

    Just my general thoughts and congrats!!!

  5. monkeymama Says:

    Welcome. I work for a small company - no FMLA - so I just wanted to say yes it is legal. I was in the same situation - but the state laws were generous (California) so I am pretty sure my boss had to keep my job for me during the standard 10 weeks disability (6 weeks post partum) or longer if I had been put on bed rest or anything. However, certainly didn't pay me a dime (didn't expect them to) and they were under no requirement to hold my job beyond that. They worked with me because I was a good employee AND because there was such a shortage of workers. So I never really worried about my job. I could have taken 2 years off and the job would be there. (I think few women can say this though).

    But yeah, if not for the state disability laws there were other state laws. I think they had to give 6 weeks unpaid to recover, or something. I'd check into your state laws. Health insurance is to be reimbursed by employee during maternity leave as well. So it all sounds about right. To be fair, small employers just generally do not have the ability to help their pregnant workers. It's kind of my pet peeve - that pregnant women feel so entitled. It helps to put yourself in your boss's shoes. (& not that I am saying you feel entitled but about 95% of pregnant women are from my experience).

    Beyond that most pregnant women do not return to work, no matter what they say. So employers don't want to get stuck paying for women who never return anyway. The bigger issue here.

    I have a lot to say on this subject apparently. But again, Welcome!

  6. CouponAddict Says:

    I have a question about your current living conditions. Do you have enough space? Will you be moving to a bigger apartment/better apartment that cost less? Do you have a bunch of stairs? Besides saving is there another reason to move?

    We signed to move out of our apartment to a much cheaper one about a month before I went into labor. We did not finish moving until after the baby came; Overlapping leases. The new cheaper apartment did not have off street parking BUT it did have about five less flights of stairs. DH's car was hit and run during the night during our contract so the savings was a wash since we had to pay the deductable for repairs, but not having to carry a baby in car seat up six flights of steps after a c-section birth was a blessing and just what the doctor ordered.

    Start saving for that cobra bill, if necessary focus on that emergency fund not necessarily debt reduction. I had to have a c-section because DS was breach so you never know what can happen. Having the insurance will save you more than you can ever guess. I think my Pregnancy/Birth was approx 68K but what the insurance paid for the delivery was 10K and I paid NOTHING because I had met my insurance annual max. Sure beats paying 68K.

    You will need to take it easy as much as possable since you are with child but can DH work more hours or a third job to help build up your savings/pay down debt?

  7. Ima saver Says:

    Welcome and congratulations!!

  8. babymakes3 Says:

    Thanks everyone for your advice so far! I guess I knew that building up that EF was the way to go, but will somehow see if we can pay off some small bills quickly, just so we don't rely so much on DH's income when the time comes. Moving to a new apartment would, at the most, save us 300 a month. We're only on 2nd floor now. We have w/d hookups, dishwasher, a small private yard, deck, view of the water...in February, when no leaves on trees! I guess we're ok where we are. As for DH working more hours, or another job, it may come to that. He actually just got his yearly raise today-27 whopping cents.

  9. Joan.of.the.Arch Says:

    If DH is going to stay home with baby, do you need to take off those 12 weeks?

    Can you can work part time, if not for your regular company then somewhere else during that 12 weeks?

    Can DH could work part time during that 12 weeks?

    Can DH continue working until you go back to work so that at all times, one of you is employed?

    Once baby is born, can you all work jobs with opposite schedules so that both can be employed and one is always home with baby?

  10. Koppur Says:

    Welcome to the blogs and congrats on the baby!

  11. Personal Finance Student Says:

    Congratulations and welcome. If your husband is going to stay home with the baby and you make more; I think I'd seriously consider going back to work sooner rather than later. Most likely you will feel fine enough to work after 6 weeks or so (maybe even less time than that assuming all goes well). Either way, I think I'd definitely have my husband work as long as possible. Good luck!

  12. Ms. Pearl Says:

    First off, if you are in a position to move to a less expensive area and still be relatively close to jobs then don't hesitate, just do it! Next, start thinking about NOT working 2 jobs when your baby is born. I don't endorse any ideology that frowns upon women working, I am just being realistic. It will be very hard and the time you miss with the baby will never be retrievable. Can your husband work part-time after the baby is born, perhaps a different shift a few times a week? Just some ideas. Good luck and congratulations on your precious baby!

  13. scfr Says:

    Welcome!

    On the rent issue, just remember that everything is negotiable. If you have been good tenants, not causing any trouble and always paying your rent on time, your landlord might be willing to make some concessions to keep you as a tenant. Research comparable properties in your area, and if you find that rents at other properties are lower, go to your landlord with your data (numbers and addresses, written down on paper ... hard cold data is best). Be honest ... explain that you would like to stay, that you would prefer not to move, but that you are enticed by the potential savings of a cheaper place. Ask them if there is anything they are willing to offer. They may offer a lower rent rate, or they may offer a "monthly concession" as long as your rent is paid on time (with the higher amount needing to be paid if your rent is late), or they may offer to throw in something for free such as cable, water, trash, etc.

    Don't wait until the last minute to do it ... start talking with them at least a couple weeks before you would be required to "give notice" if you did decide to move.

    Good luck!

  14. debtfreeme Says:

    can't give advice that others didn't already say but congratulations on the new addition and welcome to the blogs.

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