Wouldn’t you know it? I used to congratulate myself that I was able to retire on $40K a year. ($39,896 to be exact). After all, I had been living most of my pre-retirement years at $25K to $30K a year. So, you’d think (at least I did) that for me, $40K annually would be pure luxury?
Ladies and gentlemen I am probably going to be one of the first people to finally admit that I can not pay my bills as I used to. Either on time or in full. Don’t get me wrong. I’m doing it BUT I’m getting caught up in all the probable problems people who don’t pay their bills get snarled in. Like interest!
I’ll give you an example. My gas bill for my car (and included in my written budget) was $100 a month. I either spent the hundred dollars on gas for my car or I spent less. Either way, I never went above $100 for gas for two cars. Fast forward to January 2020 and my gas bill is $289, almost triple!
I only have $100 set aside in my budget to pay the gas bill. What to do? I thought of this great solution (or so I imagined) that I would pay the minimum payment before the due date to make sure I wouldn’t be late (thus avoid a late charge) paying my bill and then before the actual due date, I’d hustle to come up with the rest of the money (so I wouldn’t be hit with an interest charge). The bill would have been paid on time, in full and I’d incur no late fee or interest.
The first part worked out OK (the minimum payment, $30 paid January 6th) but the balance ($259.26) missed the deadline (January 18th) by two days (it posted January 20th). So, on a $289.26 bill. I was charged 20% interest and an additional $5.60 is now due on my next bill, in February.
“Houston, you have a problem!”
For the first time in like ever, I got zinged with an interest charge. This is NOT a good sign going forward. Obviously, my idea didn’t work. I think I’m having a problem paying my bills. I’ve re-looked over my written budget again and there really isn’t anything I can cut back on (other than food). No clothes. No travel. No entertainment. No streaming services. No eating out. Grocery supression. Installed a pellet stove to replace our propane heating expense (lowered costs by 50%). Everything looks like it’s in balance on paper, yet in reality it’s not working out. (I’ve since transferred funds over from my savings and got everything back in balance and on time. But this was something I did not want to do.)
What am I missing?
What I’m missing is that America has now become a very expensive place to live in. Anyone at or near my income level is being hit the hardest. According to this recent report (click here) for the news outlet, The National Desk, “continued inflation and record price hikes are hitting Americans hard everywhere, but new polling suggests that lower-income families are more likely to see things get worse before they get better.”
High inflation is eating up the budgets of American households. According to the new Gallup poll, 45% of households said they experience either severe or moderate hardship as a result of recent price hikes.
“It’s really kind of frightening because if this continues, it’s going to be really bad news.”
I haven’t ordered anything from Amazon in over two months! Instead, I go twice monthly to a heavily discounted odd lot chain store and buy whatever I need there instead. In other words, my whole life has changed and it’s just barely working out. At least I’ll admit it. How many people will NOT admit they are having financial difficulties? Blame some news outlets also because even The NY Times is in denial. Our financial troubles will not simply go away. They’re here to stay..
FYI: Moving, getting a job nor an EV will solve any current problem of mine right now. Till then, I’ll have to keep coming up with creative ideas and solutions.
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