Tuesday, June 10, 2008

No Go on Gas

Gas prices are not going down.  

My bubble has totally burst.  *sigh* 

My husband put gas in his truck yesterday evening and it was up to $4.059!  He used to put $55 worth of gas in every two days and now it's up to $70!

We are just fine, but I cannot imagine how people that are worse off than we are or who literally live paycheck to paycheck manage it.  

And when gas goes up so does food.  Again we are fine.  We appear to live paycheck to paycheck, but I make tons of additional payments on several debts each month that I don't have to pay.  

If we end up feeling squeezed, then the extra payments will be the first to go.  It will amount to over $400 extra every month, if needed.  My debt won't go down as much, but we'll be able to live.  And with kids that's important.

We are able to do this because we live below our means, but at the same time we don't sacrifice a whole lot either.  

  • We were told we could afford a larger house with a larger mortgage, but instead we bought in another area where the houses were bigger and the prices the same as the home we had sold.  Our mortgage was larger than the previous one, but we didn't go overboard plus we got a low fixed rate VA loan.  However, compared to others our house may be considered small for a family of 4 with two growing boys.  For us it works and we did upgrade from a 1600 sq. ft., 3-bedroom home to a home that has 4 bedrooms and just under 1900 sq. ft.  Plus we moved out of the city to a more suburban town with a better school system.
  • When a couple of years later we were looking into a heloc, we were told we could get almost double what we did.  We purposely capped ourselves to ensure we wouldn't be in debt any more than we were comfortable with.
  • When we were told more than several times by our credit union that we could have a much higher credit card limit, we told them, "no, we want a lower credit limit of $X,XXX amount" because it was all we wanted.
  • We keep vehicles until they are falling apart and only have a payment (if any) on one at a time.
  • We don't touch our retirement funds at any time!
  • When our pay goes up, we increase the retirement funds and put extra towards the debt.
  • With bonuses, we take some to splurge with and the rest goes to savings and debt.
I hate seeing people taking what others say at face value.  "Look at this!  Great!  You can afford a home at $XXX,XXX."  And then they go out and buy one at that amount without really looking at their finances to see what they could really afford with incidentals like gas and food going up, or home insurance rates and property taxes.  And I bet there are not a lot of people who consider what would happen if they lost their jobs like many are now.  *shakes head*  I feel for them, but I wonder how many could be prevented in losing their homes or having to move closer to work just because of poor financial planning.

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