In Naked With Cash, seven anonymous Consumerism Commentary readers publicly track and analyze their finances on a monthly basis. For almost a decade, I tracked my own finances on Consumerism Commentary; now I’m sharing the benefits of public accountability with the participants. I’ve partnered with financial planners who will offer some guidance along the way. Read this introduction to learn more about the series.
LastDollar is on Team Neal, with Certified Financial Planner Neal Frankle. Get up-to-date on LastDollars’s progress by reviewing her update from last month.
LastDollar’s own analysis and comments, including her thoughts on education and college planning, are followed by feedback from Neal Frankle. Jacob Wade, from iHeartBudgets, also provides feedback.
Comments and analysis from LastDollar
If you were following my updates previously, you know my son was hospitalized for a total of four weeks (two stays of about two weeks each) in June and then end of July to the beginning of August. I’m happy to report he is doing much better now, and although we have a long road ahead, we’re starting to get back into the swing of life.
Summer has been a challenge, as I try to balance the single parenting thing with running a business. I’ve run into this every summer, but I keep making it through! I’m definitely looking forward to the start of school and taking advantage of the few hours a day when the kids are in school to get focused on my work again.
I didn’t make any financial gains in August, as you can see, but I did start paying tuition payments again for the upcoming school year ($1,000), made a payment to the oil company ($500), and took care of some much needed car repairs ($350).
In order to do the car repairs, pay the oil company and make a tuition payment, I had to let a few other payments go unpaid or late (they are first to be paid in September). Obviously I try to avoid doing that as much as possible, but there are times when I have to decide which expenses or bills are the priority if the money isn’t coming in as fast as it needs to go out.
I just noticed some water damage on the ceiling of my bathroom. It appears to be coming in from outside, so I will need to get someone to check that out and quote the project. Hopefully I caught it before it becomes a serious and very costly problem.
Potential income increase coming. I don’t know if you remember, but several months ago I mentioned the possibility of one of my clients getting an investor for his business. He has been working on that for a few months and thinks he is about three months away from getting the funds. If or when that happens, he intends to put me on salary rather than paying per project; it will just about double my monthly income.
The major advantage of this situation, other than having more money to work with, is that I will have steady income on a set schedule (like a regular job, although it’s doing the same work I’m doing now as a contractor and still from home). Plus, I will still have the income from my current business (that comes in on a less predictable schedule). This gig would be a game-changer for my situation, for sure, but I am trying not to get overly hopeful in case it doesn’t pan out.
Feedback from Neal Frankle, CFP
Thanks for the update on your son. That’s wonderful news.
I can certainly respect the challenge you face running the business and the home as a single parent. The good news is that summer is about over! Sounds like that’s going to be good for everyone involved.
In my opinion you did make some important gains this month simply by keeping up with your commitments during a very difficult period. Those were some pretty hefty bills you knocked out. I call that a win. After getting to know you over the last several months, I am confident that you’ll take care of the other bills you let slide.
On the income increase, that is indeed encouraging. Here’s the one thought that came to me. This person obviously values your work very highly if he’s holding out the possibility of doubling your pay. I wonder if you could find other potential employers who might do the same? If so, that would be a great Plan B just in case the funding doesn’t come through for this person.
Feedback from Jacob Wade
First, I’m so glad to hear your son is doing better. I’m glad to hear that you are going to have some free time coming up, and time to sink into the business a bit more. And if you go salary, the steady income is going to make a world of difference. I highly suggest a set budget at that point; it should be flexible to life events that come up. If you need any specific help with that at all, don’t hesitate to contact me.
Feedback from Luke Landes
I’m very pleased to hear about your son’s progress. It’s been a year of many challenges for you, and going back to read your introduction at the beginning of Naked With Cash, I’m reminded that your financial progress seems to be defined by challenges. As I read your monthly updates, I’m always reminded about how short-term emergencies take precedence over achieving long-term goals.
And they have to, there’s no question about that. When your cash flow dictates that you have to choose each month which bills get paid and which ones don’t, you’re always catching up and never preparing for the future.
I can’t begin to pretend I know what it’s like to be a single parent of children with special needs. The situation absolutely limits the flexibility you would need to approach financial independence frictionlessly. I’m glad to hear there’s a good chance your income will double soon thanks to your client’s appreciation of your work. The way I see it, if and when this happens, you want to make extremely efficient use of the added cash flow. Eliminate all past-due obligations immediately.
Build an emergency fund. Save money for your future. Save money for your kids’ future. Make as much of that automatic as possible. Look for more higher-paying opportunities that still give you the flexibility to be with your children — a tall order, but at this point, there’s little you can do to cut down expenses. The pressure is all on the income side of the equation.