Judi, Amy and Shane’s Story
Posted by John | Filed under How I'm Doing
My name is Judi and two and a half years ago, in September 2007, I was married, mother to 3 boys, and on the verge of getting evicted from the apartment we lived in. My marriage was crumbling around me. My husband was an addict and an alcoholic, had no job, and refused to get help. I worked full time, but I had no money to leave with. My kids were literally starving, there wasn’t much money for food…the money we did have I used to try and stay on top of the bills so we had a place to live. I made a good living, but it was being ‘stolen’ from me due to the habits of my husband.
Along came my good friends, Amy and Shane, who swooped in and rescued me. They gave me the money to pay the back rent, and I left. We decided to blend our families together and moved into a house with a backyard and took to parenting our kids and making a life together. That was February 2008. At that time, Amy and Shane had 3 children as well (in February 2009, our 7th child arrived). I was able to pay back the money they lent me by cashing in company stocks that I received on my 5th anniversary at the company. We split the bills and we were to take care of our own debt. Amy took care of the kids, Shane and I worked. It’s a marriage, really, except there are 3 people in it.
At that point, I had no debt, but I had no credit rating either. In 2002, I had gone bankrupt and I hadn’t been able to get to the point of re-establishing credit because of the terrible way I had to manage money due to my ex’s habits and my spending on things I probably didn’t need. I took out a car loan (I didn’t have a vehicle) to help re-establish my credit. In January 2009 we sat down and looked at Shane and Amy’s finances. They were in shambles. They owed $34,000 on credit cards and a $14,000 Line of Credit. I was paying my share of the rent and utilities, but they were trying to pay the debt off by themselves. It wasn’t working…payments were being made late, some were being skipped, they were robbing Peter to pay Paul. Shane went to a credit counselor who told him his only option was bankruptcy. His credit score was at 560 or something terrible like that. Shane didn’t want that at all, so we sat down and we went over what was owed, what money was coming in. We had been watching TDDUP and we knew that we didn’t have to go bankrupt to get out of this mess.
First thing I did was say “you helped me, let me help you”. I took over the bill paying, Shane gave me access to his account on-line and we set up a joint account in all 3 of our names. I began putting more than just my half into the pot. We started paying more than just the minimum payments on the credit cards. At this point we were not using the jar system, so we were not tracking our variable spending well at all, but we managed to pay down about $6000 in debt in 6 months. We did this by dumping tax return money onto the debt and any extra we got in addition to regular monthly payments. In September of 2009 we decided that we wanted to buy a home. We could get a mortgage, but the bank said “you must clear these 3 credit cards ($10,000) and close them by the time your house closes”. Our house closes October 6, 2010. We punched some numbers into a payment calculator and started making the payments required to pay down those cards in one year. Shane made extra overtime, and began doing odd jobs here and there and we dumped the money on the debt. By Christmas time, the $10,000 was cut to $5000.
We also needed to get a line on our variable expenses. We didn’t keep track of anything that was going out of the account. This is when we started using the jar system and began using cash only. We cut our variable spending down to $355 a week. Our grocery jar was a mere $250 a week. Keep in mind that we have 7 children, 2 were in diapers full time, and 2 still used pull-ups at night. We had an 8 month old who was on formula as well. So how do we feed 10 people on a budget of $250? It wasn’t easy but it totally can be done. The first thing we do is plan every dinner very carefully. We scoured websites and looked for ‘frugal’ recipes. We cut down on the amount of meat that we eat. We choose cheaper cuts of meat and look for ways to cook them nicely. We buy what is in season. We rarely go out to eat or order in. We take lunches and snacks to work. We take snacks on car trips. We shop at the discount grocery chains instead of the high end stores. Much of our Friday evenings are spent perusing the grocery store flyers for specials. Our meal plans generally revolve around what is on special. Shane is a master of scavenging the meat aisle for the meat that has been marked down and we get some major deals there (like a huge ham for $4!!). For clothing we shop at second hand clothing stores, especially for the kids. We receive a lot of great hand-me-downs from friends with slightly older children. We never, ever pay full price for clothes…if it’s not on sale, we don’t buy it. More importantly, if we don’t need it, we don’t buy it. Any extra money from the jars is either put on debt or is used for something that we are going to be doing. Believe it or not, at the end of any given week, we have anywhere from $5 to $50 left over in our jars. It’s funny because we watch TDDUP and see what Gail gives people in their jars for food and the couples eyes pop out of their heads! We say, “Oh yeah, that’s SO easy…$150 a week for 4 people, ha!”. We still put money away in savings…both Shane and I through RRSP contributions where our company matches what we save up to a certain percentage. We are starting an emergency fund as well.
As it stands right now, we have gone from $48,000 in consumer debt in January 2009, to $37,000 today, Feb 22nd. I just did our taxes too…we are getting a ton back and it is mostly going on the debt. Once the taxes are in, we will be able to shave another $8000 to $9000 off our debt. Not only will the 3 cards be paid and closed for our conditions of the mortgage, we will also have another credit card completely paid off. We started with 7 cards and a line of credit. It will be down to 3 cards and the line of credit. At this rate, our debt should be paid off completely by December 2011.
So that’s how we’re doing…it feels so good to watch those credit card balances go down every month! It’s addictive! Once the debt is totally gone, we’ll increase our variable spending, but probably not by much. Amy and I love to brag about how we feed our family so well on so little…we will most likely continue to do that! Thank you, Gail, for your dedication to what you do and for guiding us and thousands of others on their quest to be debt free forever!!
March 1, 2010 at 8:24 am
what an inspiration! Thank you for sharing your story.
March 1, 2010 at 10:15 am
What a story of team work – you have done wonderful things for your families and I think it’s inspiring to see a family of 10 work so hard to accomplish great things. Keep of the great work!!
March 1, 2010 at 12:12 pm
That’s definately alot of hard work and you’re all starting to see the rewards… but a “joint” situation like this would be concerning if there was a split that developed…. too much comingling of finances can sometimes be a bad thing as well.
March 1, 2010 at 1:19 pm
How lucky you are to have people you can trust like that.
March 1, 2010 at 1:56 pm
Thanks everyone.
@Kat ~ definitely a concern, one that we have not taken lightly…what I should have added is that everything has been taken care of with respect to splitting the house and assets should something happen and we part ways…kind of like a pre-nup. If anyone does have a situation like this, I would strongly suggest making sure all your i’s are dotted and t’s are crossed.
March 1, 2010 at 8:38 pm
What an inspirational story, Judi!
You made alot of sacrifices during the process, but are clearly reaping the rewards. Like an afforementioned post, I too am very glad that you have such trusting and caring friends that managed to help you in your time of need, and then you returned the favor. Reciprocity can be such a beautiful thing in life.
I wish you all of the best on your journey towards becoming debt-free FOREVER!
March 2, 2010 at 6:04 pm
Yes such inspiration for us folks with fewer people in the household who think everything is tough and don’t think they can did themselves out! I will try to remember this when I’m in a slump and put the same amount of fight and determination into my life and succeed as you have:)
March 3, 2010 at 8:15 am
I echo what Judi says – if you’re buying a house with someone else other than a spouse, definitely get a legal agreement (there’s a difference between joint tenancy and tenants in common) that defines the asset split, the terms under which you will sell, and who owns your portion of the asset should you pass away…
March 3, 2010 at 10:47 am
Congratulations on the hard work you have accomplished so far! Keep up the great work -you all are wonderful role models for those seven children. That is priceless.
March 4, 2010 at 10:18 am
Do you think you could have done it on your own? Will the average person in the same situation be able to look at your story and not feel like they could do it alone?
Also, what is your quality of life like? Seems to be a lot of your time together is spent on money managing. This can’t be a good focus for the children. I’d like to hear more about how your family works, and how it will work after the debt is cleared.
Good luck!
March 4, 2010 at 3:43 pm
@ Joan…perhaps a little harder, but not impossible, and I think that yes, we could have done it alone. It would take longer…but I have seen people clear more debt on less.
LOL, no, it’s one night per week. We take Friday evenings after the kids go to bed to go over budget and plan the groceries and talk bills and debt repayment. The kids are normal, run of the mill kids. The 17 year old is a typical 17 year old, working hard at school and will graduate in June. Our 2 9-year-olds are in Cubs, our 6 year old in Beavers…our 4 1/2 year old will start in the fall. They play baseball and take swimming lessons. The our 2 1/2 year old will start dance lessons and swimming lessons once she turns 3 in July. We belong to the YMCA and do a lot of things there. We go on picnics in the park, we have a big backyard that they play in. We do a lot of fun things for free. We had seasons passes to Marineland last year and will get one for the zoo this year. We go on a family vacation every year to a cottage in Muskoka. Amy stays at home with the kids, so our kids get the benefit of 2 incomes, while still having a stay at home mum. Our quality of life is great. Thank you for asking.
March 4, 2010 at 5:07 pm
Wow, what a great story, and additional comments you have left are helpful too.
Very impressive that you were able to dig yourself out of a difficult situation. You are an excellent role model for your kids!! Very heartwarming.
March 6, 2010 at 9:59 am
That is amazing! Kudos to all of you! They say that 2 heads are better than 1, and in your case, 3 is superb
March 10, 2010 at 4:21 pm
Judi, congrats to you and your family.
I think it’s wonderful that you have found 2 wonderful friends you can trust and to be able to help each other. You all benefit from your arrangements and the kids get the benefit of a stable environment.
I think society could be a much better place if we stop competing with each other and start giving each other that hand up we all could use from time to time.
March 11, 2010 at 12:24 pm
What an inspiring story of financial achievement and friendship as well.
I am so happy for you and your families and wish you continued success
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