Finance Issues/ Questions

She's kind of putting the cart in front of the horse.
If she's having trouble making ends meet now, how does she expect to pay back a loan?
Private school is nice, but it sounds like she can no longer afford it.
Public school could help her out a lot - she already pays for it in taxes.
Braces - yeah, that is something that's hard to do later - so now is when that money for that child needs to be spent.
She can cut her cable tv (if she hasn't already), the 17 yr old can get an after school or summer job, even the 14 yr old can babysit or walk dogs.
Oh, and don't lend/give her any money.
Sometimes people ask for 'advice' but they might really be looking for a handout.

Why is she "crying" to you for advice? Is she trying to get $$ from you?

Good grief... For starters stop private school. That is not a "need".

$6000 for 3 children is nothing. Shame on her to have children this close to college and that is all she's saved???

Stop living beyond her means should be #1.

I don't think I'd be this concerned about my neighbor's financial situation enough to have to think this through.

I would take my kids out of private school or talk to the school about scholaships and talk to my orthodontist about a payment plan. If she can't pay her bills then she needs to be doing things to save money, not spend it.

I would have a garage sale and sell a bunch of stuff before I got a loan. Adding to your debt is never a good idea if you can't pay what you owe now.

How was she able to save 6k if she can't pay her bills? I'm from Phoenix and private school here is $900 per month per kid, so not sure if this question is even legit.

If she was doing fine then all of a sudden can't pay her bills, then sell some stuff first to get caught up. If she is struggling every single month, then she needs to review what her priorities are, what her bills vs income is and make changes where necessary. Good luck.

If I couldn't afford my bills I wouldn't be able to have savings...and I wouldn't have my kids in private school.

I would love a huge savings account and private school for my 3 kids, but it's not doable for us coming off of 9 months unemployment for my husband and a big paycut for me. It's our life right now, but our bills are paid 100% of the time on time. Credit scores are no joke when you hold clearances. She needs to rethink the way she's doing things and re-evaluate what's truly important.

I really don't have enough information to answer this question.

Is she just short bills this month or is it a new "going to be short every month" thing?

If she can't pay bills then why are her kids in private school. My step-sister had to pull her daughter from private school due to lack of funds (best thing for my niece ever!!) she ended up getting scholarships she never would have even heard of through her small private school where as public school helped her more with college costs.

What is a cont. brace? Is it braces for teeth? If they are already in braces the orthodontist will probably work out a payment plan. If they don't have them yet...well millions of kids have survived with crooked teeth (myself included).

Every financial planner I have ever heard speak says to save for yourself first...then your kids...so I am leaning towards staying out of debt and "borrowing" from her kids with the intent of paying back their accounts when times are better.

BUT not knowing more information I am not sure if this really helps in the long run...

I would tell my friend, she has two choices - take her kids out of private school or go to the private school and ask if they have financial aide or scholarships. Why has she saved the money? what was she going to use it for?

Then I would tell her to take the $6K and apply it to pay off credit cards or whatever debt it could pay off.

Then I would tell her to tell her kids they are old enough to earn money and tell them to get baby sitting jobs or pet walking jobs.

i would be responsible with my money and not end up in this situation. private school is a luxury and not needed. that could be cut. and there are assistance programs out there to help with paying gas, electric and water billls. she should also check into temporary assistance for needy families to get her thru this tough time. if she fails to qualify then she wasting money and needs financial guidance from a professional like Dave R.

Is this friend coming to me and asking me for money? Why would she get a loan when she has six thousand dollars saved? It's time to use the money and get her financial life straightened out.

It sounds like her priorities are not what I would call straight. It's great that she's saved money but at what cost?

She obviously cannot afford the private school. She needs to put her kids in public school next year and finish out this year. If she is hell bent on private school, she needs to seek out financial aide from the school.

Braces? She can work with the orthodontist to get these into payments she can afford.

Money in general? Clean out the house and have a garage sale. When Tyler and I left California? We made over $2K at our garage sales. We sold a ton of stuff over a month. it was wonderful getting rid of the extras.

I would go talk to a financial adviser and look at big picture.

We just went into bank and had to set up separate accounts - one that automatically transfers money into an "emergency" account. One is a "holiday" account. One is a kids education account.

And then you see how you live - if you can pay your bills - keep track and cut back to needs vs. wants.

We go back to reassess after the summer.

If it were me, I'd consider having them switch schools or cutting back in other ways. Smaller home? Kids getting jobs?

But a financial adviser would be most helpful. They can look at your situation and tell you right off bat what you can do immediately to free up cash.

Not sure there is enough information to answer this adequately. Please encourage her to attend a Dave Ramsey Financial Peace class. Best $100 I every spent.

What is she, a pushover? Or does she have a martyrdom complex? Or does she just feel guilty about everything in her life?

I'm sorry, but she sounds ridiculous to me. Of course she pays her bills. Private school payments? She sounds like she can't afford private school if money is this tight. Basically, she's sending them to private school in order to make their future better already. Why does she have to also give them $2000?

She makes no sense.

If I could not afford to pay my bills I would not put my kids in private school. She needs to take them out...that's a huge financial burden lifted. I don't know what their school costs but often private school at minimum is $1000 per month per child...often a lot more than that. Kid's don't HAVE to get braces. They can wait till they are adults. My boss just got braces this year...she needed them as a kid but never got them. She finally decided to go for it. I would not advise taking out a loan. If she cannot afford to pay her bills then how will she pay back her loan. The answer is to first put the kids in public school. It's not the end of the world. My kids are both thriving in public school and doing great.

I would avoid taking a loan and paying interest on the loan. If this is a short term problem she should use the money in her kids savings accounts then when she is in a better position she can pay back the money to her kids accounts without paying interest.

If this is a longer term issue, like she just lost her job, perhaps she simply can't afford private school tuition any longer.

$2000 EACH? $6000? in savings? She needs to pay her bills. Part of her bills are private school each month AND paying the monthly amount for braces. These are PART of her monthly expenses.

Geesh, if she can save $6000 then she can learn to budget her monthly income and even do a better job of it. Save? She had money left over after she paid her bills each month for however long it took for her to save that much?

If she can afford to pay for private school she can afford a lot more. If she's saving money and not paying her bills then she's not very smart.

Maybe I'm having a bad day or something but you said she saved $6000 but didn't pay her bills? So, she just had the bills but didn't pay them? And put the money in a savings account? That makes zero sense to me. You have money? you pay your obligations.

Private school? That can cost so much - uniforms, tuition, fees, etc. If for some reason your friend is opposed to public school there are free online public schools, and Arizona has several choices. Just google free online public schools Arizona. Some of the schools provide a laptop, some don't. Some reimburse some of the home internet fees. Private school has got to go.

Time to evaluate everything. Have her (or help her) look at her monthly spending. Meals out? Fast food? HBO and Netflix? Smartphones with high data plans? Car insurance? (Of course, car insurance is necessary but it's amazing what shopping around can dig up). Vet bills and grooming bills for an expensive poodle? Suppers that always include beef, or dessert, or premium ingredients? Pay-per-view or rented online movies? Soda and energy drinks instead of water? Gym memberships, dance classes, acrylic nails, salon visits? Driving the kids to friends' houses where a simple bike ride or even a walk would suffice? Leasing a car or paying for a nice car that could be traded in for a sensible - but way less cool - car? Has she purchased anything that can be returned (hasn't been used)? Is her kitchen full of the latest "as seen on tv" gadgets?

And the kids, especially the two older ones, are old enough to talk honestly to. Have they all sat down and really looked at the cell phone bill? The cable bill? The grocery bill? The bills related to the car?

Does she get an income or alimony?

If she has truly pared down everything, and still can't pay her basic bills (electricity, water, rent, car insurance) and she's driving a basic car, then it sounds like she needs advice from a pro.

If she doesn't get an income and can't work, call everybody - the utilities companies, the orthodontist, people she owes money to, the school staff, and have her ask some frank questions. Am I paying for something I don't need? Is there a way to lower my payments? I actually called Verizon the other day with a simple question, and the person volunteered that one of our lines qualified for a $10 per month discount that we weren't getting. And we found out that our car insurance (we just switched so we are just getting acquainted with all the policy details) included roadside assistance, and so did our cell phone carrier! Obviously we didn't need both, but it wasn't until we asked questions and read the fine print that we realized we were paying for the same coverage twice, so we dropped one. Often, phone and car companies just add on things that aren't necessary, that they just speed-talk their way through, and before you know it you've agreed to pay an extra $40 a month for the privilege of getting a refund if you go six months without an accident. My son knew someone who did this, and the refund was about $25. They were livid, and realized what a scam it is. Is she paying for extra data on phones and not monitoring usage? Is her electric and water usage normal for her family size and house size and area? The companies can tell you.

Having $2000 set aside isn't really going to be helpful if the power is shut off and the water is shut off and the kids get un-enrolled from school.

I'm not sure what good $2000 per child is going to do - it's not enough for braces and it's certainly not enough for any kind of college tuition. What's that money supposed to be for?

So she needs a better budget. She's living beyond her means. It's not clear to me why she is paying for private school. She needs a budget plan for every regular bill - oil, electric, orthodontist, etc. If she's so low income that she cannot pay bills, she is eligible for plans for the poor. She might get dental care from a dental school, for example. She might qualify for a state medical plan through the ACA and whatever your state's insurance connector is. Maybe she gets food stamps? But not if she has private school in her budget - I'm sure she would be turned down.

And no, she should not get a loan. She can't meet her regular payments, so why would she take on a new payment with interest? That's foolhardy.

She needs to get a job if she doesn't have one (the kids are old enough). You don't mention a husband/partner but if she should be getting child support, she needs to go to the state to have wages garnished if the other parent isn't supporting them.

She can use the money to pay her bills, but it doesn't address the underlying problem of what she's going to do when that money runs out and she's still living beyond her means.

She needs a solid financial plan even if she uses some of the kids' money to pay that advisor.

This question is confusing. Nervygirl lol.

First let me say your a great friend. I am no money advisor but here is what I would advise if this were my friend.

First since time is so close for school to be done I would tell her to go on and pay the school so the kids can finish out the school year there. At the same time she needs to go in and have an honest conversation with the school and see if they have some kind or program that could lower the tuition or scholarship. If not then she needs to prepare her kids for the fact that they can't attend that school any more. So a bandaid on that little issue. Let's look at the bigger picture.

She needs to sit down with someone she trusts to go through her bills with her and set up a budget. Yes this isn't fun and yeah it could be embarrassing but so is stressing about money and not paying her bills. Something she MUST do. Saving money for her kids is nice bit really in the long run unless the money is invested (and maybe not even then) its not enough to do much with.

She needs lot look at how huch she is paying for things like housing, cars, entertainment. See if there is a way to cut some there. Also a place I have found that causts a lot and is a way save money is with food. How much does she spend on it? Do they eat out a lot? Does she spend 5 buck or more on school lunch per child? If so its time for the kids to take their lunches to school and stop eating out.

While my knee jerk reaction to a loan is a bad idea ad I think on it it might be an answer IF a few things are in place. I would only suggest this line if the money would be used to pay off high interest credit cards and the loans interest rate was low. However I suspect that since she is not paying her bills that her credit is not good so I highly doubt that she could get a good rate. On the off chance that she does then she needs to pay those off and cancel them or cut them up. All but one for emergency. Other wise she will be right back in the same spot. If the things said above can't or won't be met then a loan would cause more harm then good.

Like I said. I am not a money advisor at all. Just saying that if this was my friend that is what I would tell her. Its is clear that she is living beyond her means. And she has some really tough uncomfortable choices to make. I wish her all the bast!!