This keeps happening every month.  I teach full time and make a little money for handling the impossible decision of whom to send to the bathroom and when.  My wife works part time and pays a good chunk of bills with her income.  I withhold the maximum; she withholds nothing.  It works out at tax time.  We have bills: mortgage, utilities, car, credit cards, car insurance, cell phones, satellite television, student loans, other recurrent rapes I'm repressing.  On top of that, we enjoy the simple pleasure of eating and occasionally purchasing sundries at the megamart.  We should have money left over every month, but we rarely do.  We live paycheck to paycheck.  That's a sad life for two young professionals.

We ate our savings.  We ate it up every month.  Why cook when that nice Chinese lady will have your fried chicken bits ready for you in 5 to 10 minutes?  The pizza you make at home is not a pizza you want to eat.  It's not DiGiorno; it's pickup, because I rationalize the expense by thinking about how much I save on tips and delivery charges when I drive over to my favorite pizzeria and get my order.  Unfortunately, the proprietors of said establishment have grown to recognize me due to repeat business.  I would much rather be the occasional pizza type of person than the pizza every week type of person.  To summarize: we were eating out, whether dining out or picking up, probably 6 nights a week.  If we just ballpark that at $20 per night, that adds up to $120 per week.  That's fine if you're on vacation.  It's not so great when it is every month for a year.  

$120 per week = $480 per month = $5,760 per year.

We ated it all up.  That estimate is on the high end, but it's probably not too far off.  I would be extremely depressed if I had software that figured out where all of our money went over the course of a year.  Figure in the fact that we both gained a ton of weight in the last year and we can arrive at the conclusion that we're fat and broke.  Two nice young intelligent marrieds with a beautiful daughter.  No savings, no plan, calories binged and monies purged on fast food bacchanals.

We took a look at our finances and decided to attack our situation.  We're not at rock bottom.  We still have our jobs and a roof over our heads, but we can do better.  Here are a few things we are trying:

1.  Save money with every paycheck - set up a recurring transfer to take a shift a small portion of our paychecks into our savings account, starting with $25 per week for a total of $100 per month.
2. Set a grocery budget of $50 per week to feed our family of three.  I suppose we should set aside a few dollars to feed the cat.
3. Ban all unnecessary expenses.  No eating out.  No questionable expenditures.  
4. Allow ourselves to spend $20 per month as we wish - no questions, no boundaries save unsavory behavior.
5. Consult one another should we need to make a purchase over $20.  Defend, justify, why, why, why?

These five rules operate on the assumption that all household bills and debts are paid on time every month.  Credit cards will receive more than the minimum payment each month as we save on unnecessary expenditures.  The cost of gas and routine vehicle maintenance has been factored into our decision making process, though we saw no need to budget it precisely as a ballpark estimate of $100/month will do just fine for our relatively new, fuel efficient vehicles.  These estimates do not include any profits found in my eBay activities or online business ventures, which by year end should total several thousand dollars in revenue (fingers crossed).

By the time 2010 rolls around, we should have about $2000 saved, assuming a gradual increase in saving behavior, and have a few thousand dollars less debt than we did in 2009.  As an added bonus, our healthier eating habits will slim us from the ugliness of obesity to the mediocrity of the overweight.  Financially and physically, we are works in progress.

You know it, it happened to you too.  College commons, table lined with freebies, you walked over and filled out a short credit card application for a beer cozy or a t-shirt, or if you worked it well, both.  A few days later, you walked to your campus mailbox (or, commuter, kitchen table where mom stuck your mail) and found a plain envelope with a three inch long rigid section underneath the pre-paid, pre-sorted postmark.  You ran your thumb across the rigidity, discovered the embossed letters of your name, the numbers of your card, the braille intended to burden you.  Innocent really, this ordinary piece of plastic stuck to ordinary trifold paper with extraordinary adhesive.  What is that strange gum you rolled off the signature panel after you ripped the card from the binding legal document you simply discarded in the nearest trash can?  Never mind, this is for emergencies only.  You signed it and stuck it in your wallet.  You took it out at your first opportunity, showing your friends, flaunting your $500 credit limit.  They were unimpressed, as they had also received their cards that day, yet possessed the humility and fiscal responsibility to keep it safely stowed in their wallets next to the picture of the real or imagined girlfriend back home.  

You spent at your first chance.  Just charge it.  What's ten bucks?  It felt powerful knowing that you distanced yourself from that purchase.  A third party intervened on your behalf, the middle man between the merchant and the consumer.  Guilt free, you took your friends out to dinner.  What's another sixty dollars?  They'll get you next time, that's what friends do.  And that new pair of sneakers, you needed them.  By the end of the month, you mindlessly spent $200, maybe $300 dollars.  Mailbox.  Statement.  Minimum payment of $20.  That's it?  Something about interest, some percentage.  You send in your twenty bucks and savor your bargain, three hundred dollars worth of stuff for a picture of Andrew Jackson, and spend something else the next month.

A month later, there's something else on that statement.  Interest rates and a little dollar amount you can't remember spending.  It's not insignificant, so you call the number on the back of the card, demanding to know where and when you spent $12.51 because you would have remembered an oddball purchase like that.  Someone on the other end explains, possibly for the hundredth time that day, the grace period and calculation of interest, explains how you agreed to those terms when you filled out the application, activated your card, and made that first purchase.  Oh.  Well, what's twelve bucks anyway?  Make that minimum payment, sleep in and skip another class.

What's another credit card?  Can I get a higher limit?  Of course.  Want more credit, go ahead and get it.  Here's enough to hang yourself.

That's how my story started.  I still have that credit card, except it now has a $19,000 limit.  I have several other personal credit cards with ridiculous limits.  At any time, I definitely have access to more money than I actually earn in a year.  How does this make any sense?  If you make $40,000/yr, go ahead and spend $100k in a heartbeat.  I could pull that trigger anytime, pool my cards, and buy a cigarette boat to go smoking down the Niagara River.  Might as well cut waves all the way to the Falls and go over.

I do not own my house.  Each month, I buy about $120 of it from the bank and give them a bunch of money in interest.  Some investment, what a scam, this amortization.  You know where I'm going - scamortization.  Only 23 years left to go before I own 100% of this house.  I own one of my cars, it's paid in full.  I have about two years left on the note on my wife's car and I'll be as happy as Little Richard when that's finally paid off.  My wife and I consolidated our student loans and we owe those folks somewhere in the neighborhood of $68,000.  I think I have three lifetimes to pay that off, so I'm not worried as I plan to be reincarnated as a Rockefeller in the next life.  This secured debt gives me no sense of security.

Unsecured debt, bother someone else.  Personally, we're not too bad on credit card debt.  I'd say about eight grand.  However, I ran a small business for nine years.  It recently closed and left me and my partner staring at about $35,000 in debt we need to split up and reconcile.  I'm not thrilled with the debt and if I could do it all over again, I would have never played with the house's money.  The house holds all the cards.  I looked at debt as a tool for building wealth.  Instead, I smashed windows with my debt hammer, wasted money overstaying our welcome.  If we'd gone to the business doctor four years ago, he would have given us six months to live, but we clung to some idea of life, of usefulness and vitality, for four more years.  No use crying over spilled milk.

All told, I'm staring at a mixture of good and bad debt totaling nearly $200,000. Most of it is "good" debt - one mortgage and a few graduate degrees. Nevertheless, helplessness settles in. It's hard to get comfortable with that number. I've been duped into working for the rest of my days to pay for the days I've already lived. Another expensive lesson learned. Debt, while we'll never be friends, I think we can work things out.