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Need advice. I don't know how to be an adult.

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Velisity
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Need advice. I don't know how to be an adult.  Reply with quote  

Sorry for the goofy title but I couldn't think of any other way to put it.

My husband and I have been living off about $15,000 a year for the past 5 years (Since we met), probably less some years. We got together both addicted to drugs and in a horrible situation and slowly we've pulled ourselves out of the waste we were in to where we are now. (Mind you I've been living in poverty my entire life.)

My husband is about to finish college. He got his degree as an A&P Mechanic and won a bunch of awards and was able to land a job at an Boeing company fixing hydraulics on airplanes. We're about to go from $15,000($700/month and $1700 extra every 3 months) a year to $50,000 ($4000/month or so). It's a huge difference. He starts work 8/26/16. After two weeks of training, he will be on full time with optional but encouraged over-time.

We've been living off a bunch of welfare. We get food stamps, state health insurance, "Obama phone" and almost in an instant we're going to be losing all of that. We are proud but at the same time I'm so freaking scared. I don't even know why this scares me, possibly because it was a security net? I'm actually ashamed of it.. However I am elated, finally being able to get off of welfare altogether.

I don't know how to budget. I haven't gotten the first clue on how to plan for anything or save money. We're both compulsive spenders but it's tapered off in the past year because there really isn't anything we want/need with our current money level but soon we're about to have more money than either of us have had since we moved out of our parents house and started making horrible life choices. Now is the time that we either make it or break it and personally I want to have the "American Dream"... Where do we start?

Little bit about us. We have a 3 year old daughter, and we live in a very tiny one bedroom that has been to small for us for about 2 years. Our current rent is $675 a month. The only extras we have is the internet and netflix. My credit is about 635, I have one red mark on it. I got a $300 credit card about 6 years ago that I never managed to pay off. Other than that, I have no credit. My husband has a cell phone and a cable company bill on his. Together we owe roughly $2500 in debt, and then my husband has a $23,000 student loan to pay off that's going to start billing us in 3 months. We own a car worth about $2000.

Any advice will be greatly appreciated. We don't want to mess this up. Losing everything we've been so used to using is going to cause us to freak out. I don't want this to happen. I don't want my husband to be working only to support or bad choices.
Post Fri Aug 19, 2016 5:40 pm
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oldguy
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quote:
We've been living off a bunch of welfare. We get food stamps, state health insurance, "Obama phone" and almost in an instant we're going to be losing all of that. We are proud but at the same time I'm so freaking scared. I don't even know why this scares me, possibly because it was a security net? I'm actually ashamed of it.. However I am elated, finally being able to get off of welfare altogether.


Congratulations on your progress and your decision to join adulthood. You aren't as unusual as you might think - I'm age 77, I've seen the beginning of the welfare safety net programs that you are using - and I've seen how it has robbed the younger generations of their independence. Your list, plus UI checks, have given people a reason to not work, not grow up. And why would you work - if UI pays as much as entry-level-min-wage jobs, why would you buy gas, pay for childcare, and work? As you said - ashamed. There was a time, WW2, when anyone who asked for a 'relief' check was frowned upon, everyone was expected to look for work until they found it - and no pick and choose, if the only job was cleaning septic tanks or shoveling out hog pens, that's what you did, ie no waiting for a better job to show up.

You'll find it easy to live on $50,000, you do well without a bunch of gov't help. And Boeing is a great employer - good salary, good family health coverage.
One caution - don't go nuts with your new-found income stream. It happens a lot, college kids graduate and transition from 'poor dorm life' to a instant 'big bucks' earner. And they buy new cars, fancy clothes, rent an upscale apt - and crash into big debt. So try to keep living as if you were still making $15,000 - do that for a year until you have a good idea where your money goes each month, how much Federal, state, city, tax you'll pay each year, how much Social Security tax, and so on. List it all on a spreadsheet, sum it at year-end. Then you'll know what to wxpectg in the following yr - each year.

And invest in yourselves - do it with the Boeing 401k Plan, if you put about $500/m into the plan, every month for 30 yrs - you'll have around $1,350,000 in 30 yrs. (I did that with a similar flight company when 401k were first invented - and I retired with about that amount).
Post Fri Aug 19, 2016 6:59 pm
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Velisity
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Thank you for your reply!

This actually made me feel a lot better about things. I never intended on starting life out on welfare it just happened that way with all the bad choices I made. I also plan on finishing college in about two years with my nursing degree. Working up feels awesome!

We were wondering how much we should put into Taxes and such. I can't even imagine what a million dollars looks like.

ETA: My father had the same mind set about government help. He had 4 kids and a wife to support and he would rather us go collect berries in the bushes out back than get a food stamp check. He refused.. I respected him for that. Sadly he left us in 2013 and he never got to see how much I've improved my life. He would be proud... I just had no idea how to live life, and now I do. I want to learn everything I can about it.


Last edited by Velisity on Fri Aug 19, 2016 7:56 pm; edited 1 time in total
Post Fri Aug 19, 2016 7:40 pm
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Publius
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Congratulations on your sobriety! That's incredible and should be guarded as you go through these big changes.

They will walk him through filling out a W-4 that will determine how much taxes are withheld from each check, so you don't have to worry about budgeting for the taxes at the end of the year.

Likewise, he should have a benefits review during orientation that will outline insurance and retirement benefits. Feel free to come back here with questions on that when it is time, but they will likely help in explaining the options.

Boeing is a great company (they are a big employer in my area) and I know several people that have spent their entire career there.
Post Fri Aug 19, 2016 7:54 pm
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Velisity
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quote:
Originally posted by Publius
Congratulations on your sobriety! That's incredible and should be guarded as you go through these big changes.

They will walk him through filling out a W-4 that will determine how much taxes are withheld from each check, so you don't have to worry about budgeting for the taxes at the end of the year.

Likewise, he should have a benefits review during orientation that will outline insurance and retirement benefits. Feel free to come back here with questions on that when it is time, but they will likely help in explaining the options.

Boeing is a great company (they are a big employer in my area) and I know several people that have spent their entire career there.


Thank you! It's kind of why I put it in my question. I am so very proud of my husband and I. The transformation we've gone through in the past 5 years is just amazing. I don't really have anyone in my life right now I can brag too. Thank you for taking a moment to read what I had to say and for your advice. I'm getting an idea of what we should do next.
Post Fri Aug 19, 2016 7:59 pm
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danerlavigne
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One thing that has helped us a lot is being disciplined with saving.

Every week we save 10% of what we make, even if we have to put off getting something that we need in order to save that money.

We also give 10% to our church, but that is a totally different conversation.

Congratulations!
Post Fri Aug 19, 2016 9:53 pm
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Velisity
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quote:
Originally posted by danerlavigne
One thing that has helped us a lot is being disciplined with saving.

Every week we save 10% of what we make, even if we have to put off getting something that we need in order to save that money.

We also give 10% to our church, but that is a totally different conversation.

Congratulations!


That is a wonderful idea. I was speaking with my husband about these posts and the one from Oldguy really got us interested. If we stay here and keep living like we have been we'll be able to save a lot of money. Maybe even enough to put a down payment on a decently priced house. It also gives us time to pay of the debt we have. The big one is his student loans. Thank you for your reply and taking the time to read my post.
Post Sat Aug 20, 2016 12:52 am
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GardenCat
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Hi there
You have a lot of good and new "updates" to your lives! Congratulations!!!
A few pointers from my time as a credit counselor - First, you are not alone in trying to figure out how to handle your finances and your lives

For all of us, There is a significant separation between our needs and our wants. You will likely find that with greater income and "disposable income" you will think you "need" many more things. Figure out what is really necessary in your lives, food, shelter, transportation, medical care, simple clothing...anything other than the basics falls into the "wants" category, and you can budget/save up for those things without endangering your future needs and this will take will power, which it seems that you both have to have overcome your previous addictions (again, congratulations!).

One strategy for determining what may be a "want" is to take a few days to make the decision before purchasing whatever it is...

I agree with OldGuy about investing for yourselves through any Boeing retirement plan. If Boeing has a "match" (some percentage of the salary that they will contribute to the plan) be sure to put at least that amount into the plan every paycheck as you get an instant 100% return on that $$.

Be careful about "deals" that offer "no interest" on some purchases. The catch usually is no interest if you pay off the entire amount by whatever the stated term is (90 days, one year, etc.). If you don't pay off the entire amount, they usually will charge you interest from day one of the purchase!

Credit cards... Only use cc's for what you can pay for each month - don't carry a balance, pay them in total each month. And make sure you both know about all the cc's that you both/each have. It is absolutely true that people spend more money when they have and use their credit cards rather than cash or checks.

Student Loans - If the loan(s) are low interest and fixed rate it may be wiser, in the long term, to invest your money into retirement funds (IRAs, Roth IRAs, even taxable investment accounts), as these accounts will, again in the long term, earn you more money than you will save by paying the student loans off early.

Enough for now. Keep up the conversation. It will be good to know how you are doing with your new successful lives!
Post Wed Aug 24, 2016 6:12 pm
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