When can I expect my tax refund? April 6, 2008

“We’re getting a refund. We’re getting a refund” (to the tune of Na Na Na Na Boo Boo)

We NEVER get a refund. Well, OK, last year our federal refund was about $500, but we owed the state $280, so we never get MUCH of a refund. The hubby is self-employed, which I believe I have already whined about here. We do not set money aside for quarterly tax payments, since we would be too tempted to tap into it when money gets tight, as it always does. Our solution is to take his taxes out of my paycheck. Although we have children, I take zero exemptions; plus I have an additional $250 per check taken out for federal taxes and $75 taken out for state taxes. Since we file jointly, this seems to offset what he would have had to pay. This gets us off the hook as far as paying quarterly estimated taxes for him goes, without incurring a penalty.

The hubby’s income has TANKED during this recession. Yes, that’s right. I called it a recession. I don’t care what economists say. When the value of our home has dropped 30% in the past two years and our family income has dropped about 25%. Meanwhile the cost of gas, food and utilities has gone up dramatically, that’s what I call a RECESSION!!! Eh-Hem…

I had a point. WE’RE GETTING A REFUND! That would be the one bonus to making far less than anticipated. Since the amount we paid out for his income taxes wasn’t tied into what he was currently bringing home, we over paid and will get back about $4,000! Plus! About $800 from the state!!! Of course this news makes me act like a little kid who has been promised she can go for an ice cream cone “Later..” When? When??? When do we get it??? Can I get it now? Huh, mom?

I found this handy dandy refund payment schedule from the IRS. We should be getting our refund on April 11th, since we e-filed on the 31st. ALSO! This Stimulus Payment Schedule tells us we can expect our economic stimulus payment to be direct deposited into our account on May 9th. Not that we are going to stimulate the economy with it. With any luck, we’ll have some money of our own by then and can use it to pay down debt.

Sorry economy, you’re on your own.

How much can I deduct? March 27, 2008

I’ve been wondering… what is the allowed amount you can deduct for charitable contributions of clothing and household goods?

I don’t bother with garage sales. I usually just give my children’s old clothing away to friends. This year I gave much to Goodwill. So how much can I deduct? $2 per pair of jeans? $5 per pair? There has to be a list somewhere, right?

Time to Google.

Ah-Ha!  The Salvation Army to the rescue!

Mini Financial Meltdown October 12, 2007

I had a mini-meltdown today on the phone with my husband. I can’t take the stress of not enough income anymore. His work has been so unproductive, we’ve put the mortgage on the credit card four times during the past year. Twice during the past 3 months. Next week may make it one more time.

It all comes down to $13.74 a day October 9, 2007

I am going to use a little math to show my husband just exactly how that “little bit of money” does really make a difference.

If you add up our home equity loan and our credit card debt, we owe $45,000. Gulp! That’s where the sick-to-my-stomach feeling comes in. I was driving to work this morning when I allowed myself to realize that our “home equity” loan was really just a PC way of saying unsecured debt which we rolled over into our mortgage. I wanted to pull over to the side of the road and cry. Especially because I don’t know how we are going to pay the mortgage next week.

How could this happen? How?? I am a smart, well-educated woman who was raised better than this! I kept my eyes focused straight ahead and practiced long, slow breathing to get myself calmed down. Then I thought it through.

Our debt really started nine years ago when we bought our house, which was a good deal, but which we obviously couldn’t afford. At the time I was staying home with our 2-year old and newborn. No income there. My husband was (still is) self-employed. Unpredictable income there. Therefore when an emergency expenditure came up or he had a slow week or two, it went on the credit card. WHATEVER “it” was. What do you mean we owe $8,000 in taxes? Credit card. Our car died unexpectedly and we can buy another one for $1,800? Check to the credit card. No money for groceries? Credit card. You get the idea.

Okay. So how, in just nine years, do we end up with $45,000 worth of debt? Let’s break it down. $45,000 over 9 years = $5,000 per year of accumulated debt. $5,000 per year/52 weeks = $96.15 per week. 52 weeks/7 days per week = $13.74 per day. That how much more we were spending over what we were earning.

If we only had spent $13.74 less per day, we would not be in this huge hole. $15.00 less per day, and we would even have over $4,000 sitting in our bank account right now as an emergency fund.

This, I can handle. While it will still take us years to dig out of the debt we currently are in, my goal right now is to not incur any more debt. Cutting $13.74 out of our spending per day keeps us out of further debt. That’s only $6.87 each!

I do realize this way of breaking it down is a little simplistic, but I can wrap my mind around this concept. $45,000 makes me weep. $6.87? Chump change!

Daddy Needs a New Pair of Shoes September 30, 2007

My husband needs a new pair of running shoes. Desperately! The sides are splitting, they’re nasty dirty, the tread is gone, and they’re actually quite embarrassing.

But we’re not buying him any. Not yet at least. Part of why I am starting this blog is to have something to look back upon. The thing is, we’re broke. Not just broke, but in debt. Lots and lots of credit card debt. I feel sick when I think about it. My stomach flips and sinks and nausea sets in.

There has always been some excuse as to WHY we are lacking funds, and I can even give one now. Last year my husband’s income went down by 25%. This year, he’s on target to make even less.

He works on commission. Well not actually commission, because that implies that he works for someone else. Which he doesn’t. He is self employed. Notice how self has four letters? That’s becuase it’s a bad word. Self employed means no guaranteed income, no retirement, no 401K and no health insurance. All those “nos” have each served as the excuse du jour at one time or another.

What we are finally coming to terms with is this….It’s not that he made significantly less money last year, it’s that our spending habits stayed the same. That’s right. I am admitting that it’s OUR FAULT. Not the circumstances, or bad luck. We simply spent more than we earned.

My new obsession is finding a way out this financial mess. With no overnight solution in sight as to how to earn more, we are left with spending less. Not the answer I want to hear, but sometimes reality bites.