August 16, 2015
Mr. Moore,
Thank you for taking the time to share your financial situation with me. Based on the information you provided,
you appear to be operating with a monthly deficit of $792.86 while maintaining your monthly expenses. This
does not include your unsecured debts, and is based on the following information:
Summary
Income
Expenses
Debt Payments
Deficit
$2,565.14
$3,158.00
$200.00
($792.86)
Below are recommended spending percentages compared to your own:
Housing
Food/Cleaning/Paper
Transportation
Miscellaneous
Medical/Dental Vision
Savings
Charitable
Debt
Total
Recommended
30%
$769.54
15%
$384.77
15%
$384.77
10%
$256.51
5%
$128.26
10%
$256.51
10%
$256.51
5%
$128.26
100%
Actual
46%
$1,189
15%
$385
35%
$899
23%
$590
4%
$95
0%
$0
0%
$0
8%
$200
131%
$3,358
Financial Condition:
Currently, you are overspending in the following area(s): Housing (46%), Food (15%), Transportation (35%),
and Miscellaneous (23%). In your questionnaire, you indicated that you are filing Ch. 7/13 bankruptcy and are
over-extended with credit card debts. You also have student loan debt. I understand you are the only one in
your household.
I appreciate you taking the time to explain your overall situation with regard to your bankruptcy filing and living
situation. It appears you have had to make some difficult decisions in order to make your finances as
manageable as possible. You indicated that you have credit card debt. These debts are considered to be nonsecured debt, and are the types of debts that will likely be discharged under your bankruptcy. As such, they
have not been included in your payment obligations. However, you will likely have to continue to pay your
student loan debt if it is not in deferment status. I have included $200 towards this debt but that amount may
change. Please consult with your attorney. Any additional debt repayment obligations will require you to adjust
your monthly budget. I encourage you to explore programs and resources you may be eligible for to help
balance your budget each month. I am happy to provide some resources for you.
Housing
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(877) 769-4069 -- Email: Support@TheMesquiteGroup.org
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If you own a home, your mortgage(s) payment, homeowner’s insurance, property taxes, home owner’s
association (HOA) fees, utilities, and maintenance expenses (house alarm, yard maintenance, repairs) are
included in this category. If you are a renter, your rent, renters insurance, and utilities are included in this
category.
Because mortgage/rent, insurances, HOA fees, and property taxes may be inflexible expenses, the easiest
way to cut expenses in this category is to control more flexible costs like water, electric, gas, yard
maintenance, and trash removal. However if you rent, and your lease is close to the end of its term, you may
want to consider moving to a place with a lower rent if possible.
Here are suggestions to keep your housing expenses within recommended spending guidelines:
Saving on utilities:
·
Install low flow shower heads
·
Unplug “vampire electronics” (appliances that include a clock or operate by remote)
·
Replace your light bulbs with compact fluorescent bulbs
·
Run full loads of clothes and dishes, particularly between the hours of 7:00 pm and 7:00 am when
usage rates are usually lower
·
Insulate your water heater
·
Use cold water to wash your clothing
·
Call you energy/power company for an energy audit. Many provide them free
·
Keep your thermostat warmer in the summer and cooler in the winter
o
Programmable thermostats can help save money and many utility companies provide discount
programs to help cover the cost
Food, Cleaning, & Paper Supplies
This category includes spending on groceries, restaurants, school and work lunches, snacks, and cleaning and
paper supplies. Here are some ideas on keeping your expenses within recommended guideline and freeing up
some more cash in your budget:
Groceries
Food is a basic need and it is a very necessary part of our personal budget. The average cost for groceries is
anywhere between $150-$250 per person per month (per USDA Food Plans). Individuals with special dietary
needs may find themselves on the higher end of the scale. Here are some simple money saving techniques
to keep this cost in line with your budget.
·
Make a menu of the meals you plan to eat and make your grocery list directly from the menu
·
Shop weekly to cut down on wasting produce
The Mesquite Group www.themesquitegroup.org
(877) 769-4069 -- Email: Support@TheMesquiteGroup.org
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·
Make a grocery list and stick to it. Check the weekly sales flyers at the stores to see what is on sale
and plan your menus around those items. If it isn’t on the list, don’t buy it!
·
Never underestimate the power of a coupon
·
Eat before you shop. Don’t let your growling stomach tell you what to buy!
·
Compare cost per unit (cpu). Some times more is less!
Restaurants, School lunches, work lunches, and snacks
Never underestimate the value of brown bagging your lunch. A peanut butter and jelly sandwich on whole
wheat bread can run about 54 cents a sandwich whereas the average cost of school lunches for 2010 was
$2.58 ($56 a month). As any parent knows, mornings can be a hectic time to get the kids out of the door on
their way to school. Try making lunches the night before to save on prep time in the morning.
Grabbing lunch out while at work can be costly to both your wallet and your health. The average cost a combo
meal at a fast food restaurant comes in at $4-$7 range. That translates to $27.50 a week, or almost $120 a
month, or $1440 a year (not to mention the not-so-good health effects of foods high in fat and sodium)!
Consider packing your lunch or taking in leftovers!
We often overlook the real cost of grabbing a quick snack or coffee. The average cost of a medium latte is $3.
Get your java fix at home rather than at your local coffee shop. Not a barista? There are several single cup
coffee brewers that take the guesswork out of brewing at home and can cut your cost in half (or even more).
You can also pack your own water bottle instead of buying bottled water and keep snacks handy for work,
school, and running errands.
If you enjoy the experience of eating out a restaurant, you are not alone. The best plan for any budget is
planning. Make dining out a part of your budget and your grocery/menu planning. Here are some good tips for
keeping this expense in check:
·
Try eating out at lunch rather than dinner. The lunch menu tends to be less expensive.
·
Many restaurants have large portion sizes. Share an entrée with your partner.
·
Check to see if restaurants are running specials. Many have specials for 2 running.
·
Try to catch the early bird special (dining before 6pm)
·
Order water instead of soda (you can save anywhere from $2-$3 per person)
Cleaning & Paper Supplies
Household cleaning products can get expensive quickly. Coupons are relatively easy to find in your local
newspaper and online. You can also purchase store brands to save money as well. Using all-purpose or
multipurpose cleaners can help you cut costs on specialty cleaners. Even better, make some of your own
cleaning supplies!
Transportation
Transportation expenses include car payment(s), fuel, insurance, tags and licensing, tolls, parking,
maintenance, and public transportation.
The Mesquite Group www.themesquitegroup.org
(877) 769-4069 -- Email: Support@TheMesquiteGroup.org
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Once you have a car payment, you are obligated and bound by contract to make your payments as scheduled.
Leasing a car may seem like a money saving option, but often, leasing is much more expensive and much
more complicated than buying, even more, many require you to keep the vehicle dealer maintained which
results in higher maintenance costs for you. The Federal Reserve Board has a great guide to help you
understand the difference between leasing and buying a car. Check it out online: Keys to Vehicle Leasing.
Fuel costs continue to rise and many of us drive SUVs, Vans, and large sedans. Controlling your fuel and auto
costs may seem impossible, but we’ve got some helpful tips to get the most from your tank:
·
·
·
Car-pool:
o
You’re not the only one looking to save money. Ask around at work and see if anybody is
interested in car-pooling. You can swap weeks with drivers and cut down on wear and tear on
your vehicle.
o
Do you and your spouse work in the same traveling direction? Share a ride and save some
cash.
Running Errands
o
Reduce the amount of time spent on the road by creating an “errands day.” Try to run your
errands in as few days as possible to reduce the amount of gas spent traveling roundtrip.
o
Plan your errands trip by traveling in a loop so that you’re not backtracking between
destinations.
Insurance
o
Lower your premium by increasing your deductible. Make sure you can afford a higher
deductible before making any changes.
o
Is your car an older vehicle? Consider dropping collision and/or comprehensive coverage. If
your car is worth less than 10 times the premium, purchasing the coverage may not be cost
effective.
Medical:
I am unclear if your medical premiums are paid as a payroll deduction or are an extra out of pocket
expense. If they are deducted from your check, this may free up some more cash for other
expenses.
There are many resources and insurance options that may help you cut down on these costs. The Mesquite
Group attached a copy of our reference guide entitled “Health and Well-being Resources” to help you
continue to keep these costs in check.
Miscellaneous Expenses
Here is a breakdown of each of the types of spending included in your miscellaneous expenses:
Communication/Entertainment: home telephone line, cell phone(s), pager, internet access, cable/satellite
television, video rental, movie tickets, magazine and newspaper subscriptions
Ways to save:
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·
·
·
·
·
Consider dropping your land based telephone line
Drop premium channels or give your cable/satellite the boot altogether. There are many services that
allow you to watch your favorite television shows and movies via internet streaming for a nominal cost
or even for free!
Catch a matinee instead of an evening show at the theater
Do you have a magazine you love to read? Don’t buy it at the store! Shop for magazine subscriptions
carefully. Check online to get the best pricing. You can get them for $1 per magazine and cheaper!
Internet savvy? See if your local paper provides “online” only subscriptions. Save paper and money!
Recreation: Recreational vehicles and insurances, time shares, dating expenses
Ways to save:
· If it floats or flies, it is typically cheaper to rent than to own!
· If you have seldom used equipment, give it a new lease on life by selling it.
· Plan a budget for “date night”. Don’t forget to include baby-sitting in your expenses.
Personal Care: haircuts nail salon, massages, specialty hair care products, vitamins, health club dues, dry
cleaning
Ways to save:
· Join social coupon sites like Groupon or LivingSocial to save on local services.
· Find a low maintenance hair style; hair color is costly to maintain, keep it simple.
· Acrylic nails require constant upkeep; do your manicures and pedicures at home.
· Utilize local Beauty or Massage schools to reduce expenses.
· Are you really using your health club? Most Americans are losing money on gyms they never frequent.
Opt for free activities like running, biking, walking, swimming, and aerobic exercise at home.
· Consult with your doctor about money saving options for vitamins and supplements.
Important Note
Household, food and cleaning products, transportation, and medical and dental expenses
should not exceed 65% of your take home pay (net income).
During and after the bankruptcy, it will be critical that you are able to maintain a balanced budget. If your
expenses exceed your income, you will need to either reduce your expenses or supplement your income. I
would recommend tracking your current spending to help identify funds that can be freed up to further balance
your budget and eventually allow you to re-build an emergency and long-term savings. This information can
be used to create a written budget, if you have not already done so. There are great tools available online if
you are comfortable using them as well as other resources. These will be included in the attachments with
your certificate email but some to look into would include Mint.com for budgeting. I encourage you to look into
using Benefits.gov particularly to help identify resources that you could utilize moving forward, I will also be
sending health and wellness information as well.
Once you have filed your bankruptcy case you will be given a case number. You can call us back at any time
after you have received your case number to register for the second required class. That class must be
completed before your debt can be discharged.
Visit www.uscourts.gov for more information regarding the bankruptcy process.
Thank you for choosing The Mesquite Group! I wish you the best in the future!
The Mesquite Group www.themesquitegroup.org
(877) 769-4069 -- Email: Support@TheMesquiteGroup.org
Page 5
Heather Walrath, AFC
Financial Counselor
The Mesquite Group
The Mesquite Group www.themesquitegroup.org
(877) 769-4069 -- Email: Support@TheMesquiteGroup.org
Page 6