Just imagine Hell. Hell has got to be…where you expected an $85 bill but now you’re trying to find someone/anyone on the other end of the phone line (on a shoddy vulnerable connection) to answer why you were billed $2,000 for a set of routine labs.

“That’s Interesting!“

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Hopefully, this article will help put an advocate in your corner for that ridiculous medical bill charge. There are a lot of hidden bombs in the minefield of insurance and medical billing so take this with you:

Common Medical Bill Errors

According to Medical Billing Advocates of America, 80% of medical bills have some form of error. Add this to the fact that medical bills can bury someone in debt, this is a critical issue for hospitals and insurers. Here are the most common medical bill errors that are commonly encountered in the US –

1. Typo of Patient Data 

People who handle patient information can make a mistake in encoding. One of the most common causes of this mistake is when the handwriting is hard to decipher or if the one who filled the form during admission was not a relative or acquaintance. There is also a possibility that upon encoding, the encoder might’ve switched two patient’s information, although it is not as likely to happen. 

2. Coding Errors

Hospitals and insurance providers have codes for their products and services, just like in grocery stores. The three usual code sets used are Current Procedural Terminology (CPT) codes, Healthcare Common Procedure Coding System (HCPCS) codes, and ICD-9 codes. You can usually find the code before the service description or in the separate column.

An example of an error is when you are billed with a major procedure instead of just a checkup because of a one-letter difference. There are free databases online where you can look up the code in your bill to confirm if you’re properly charged.

3. Duplicate Charges

Duplicate charges happen when you pay the same things, with either the same or different code. An example of this is when you are billed with your room usage twice on the same date. Another one is when you are charged separately for services that are actually included in your room package.

4. Canceled Tests or Procedures

This happens when you request to cancel a procedure, but they included it on your bill anyway. One common reason why this happens is when your doctor forgot to update the management about your procedures.

5. Unbundled Charges

Unbundled charges happen when instead of charging as a package, you are charged with separate services that make up a bundled package. As per Catalyst, an example of a bundled package are tests to diagnose UTI, Sepsis, and Congestive Heart Failure. They’re charging you with the right items, but because it is not charged as a package, the package discount is not availed.

6. Check Your Explanation of Benefits (EOB)

If you’re the one who usually ignores EOB documents, you should build a habit to check it for information inaccuracies. This document is sent by your insurer and includes the list of treatments that they will shoulder. In addition, this document also includes the amount that you would need to pay because it is not covered by your policy. Compare your EOB to your final bill to make sure that you won’t have to pay charges that are already paid by your insurer.

7. Location of Ordering Physicians

This one was what went wrong with us. Just because of this little misstep based on the location of our ordering physician – we had a pending charge of $8,000 that insurance and our physician had to settle back and forth (which has taken months and share of it is still on-going.) It should have been no more than $100.

Apparently, if you work for a large employer with insurance in different states, the location of exact coverage differs based on tons of factors, but they don’t tell you about it during pre-authorization. It still doesn’t make sense to us, my husband was so very annoyed. In this case, the uninsured price was cheaper than the insured price charge…so we negotiated to pay the uninsured price. Logic has no place here. I don’t envy anyone dealing with medical insurance.

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Steps In Negotiating Medical Bills

1. Review Your Medical Bill & Insurance Policy

Check your medical bills for possible errors. Make sure to tally the services you received and compare it to the final bill. Watch out for the errors listed above, use free internet sources to check the codes. And lastly, verify that you have the right information written in your final bill. It is also a great idea to review your insurance policy to save time if ever your insurer refuses to pay your bill.

2. Contact Your Insurer & Hospital Billing Department

If you found some errors and inconsistencies, the first thing you should do is to call your hospital’s billing office regarding the inaccuracy in your bill. Each information in this call is important, so take note of the conversation. If the inaccuracies are easy to correct, it can be easily done during the phone call.

However, if the problem is not resolved, the next thing you can do is to contact your insurer. The insurer will likely help you in filing your claims, especially if the claim will help in reducing your bills (which could also reduce their billings, especially in cases of duplicate charges).

You should also act on fixing the bills as soon as possible because unpaid medical debt will affect your credit score and it would take at least seven years to remove it. It is suggested that you also contact a credit-reporting agency to let them know that you’re disputing a medical bill.

3. Organize Your Hospital Documents

In order to win the dispute, you need to arm yourself with evidence showing the errors of your healthcare provider. If you’re not provided, you can ask for an itemized statement of your medical bill. You should also present documents from you and your doctor’s agreement if you refuse treatment but the hospital still charged for it. Results after the treatments are also strong documents to include in your appeal.

4. File Your Appeal

The next step is to officially make an appeal for your medical bill. Make a letter regarding the error and explain all your concerns in polite but detailed contents. Attach a copy of your files and evidence, as well as include the details of the conversation you had with the billing office including the time and date of the call and the name of the representative. You should both fax the letter and send it by mail. By sending a letter as soon as found an error, and if it is sent to collection, it should be noted as disputed.

5. Negotiate Your Bill

After the medical bill has been disputed, and the error of the billing department has been acknowledged, you will be given a new medical billing with adjustments. If you think you still need help after the adjustments and after exhausting your insurance coverage, try to negotiate the amount you owe for a lower price. The hospital will more likely work with you in restructuring the amount you owe if you show that you have the intention to pay.

You can speak again with the billing office and make a payment plan that can help you pay your medical bills. Don’t be shy and ask if they could reduce the price. Explain your financial situation and be honest about the details.

6. Consider Seeking Help From a Billing Advocate

This is for when all else fails. If the hospital won’t still honor the dispute, or if your insurer will still reject to pay your coverage, you should consider seeking help from a medical bill advocate. A medical bill advocate is a person that knows the medical delivery system and should help you in negotiating your bill. Although there are medical bill advocates that offer their service for free there are others who would charge for their services. But the fee is nothing compared to the money you’ll save in negotiation. You can find a billing advocate in both NAHAC or APHA.

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Sample Letter For Medical Disputes

In order to make a strong case, your medical bill dispute letter should be detailed but concise. You should also put important information such as your name, address, and contact information. Include the date of your billing along with a billing identification number. Elaborate the error and support it with solid evidence. Mention the involved code if the error is from a coding error. If the error is excessive charging, explain your point by comparing the cost of services in another area. Also, mention how you want to rectify the errors, but as polite as possible.

Sending a letter does not only notify the hospital about your concern in your medical billing. This is also a way to make them comply with federal requirements, as written letters are strong evidence. Creating a good letter is important should you ever have a problem with your dispute.

Here is an example of a billing dispute letter about an error in upcoding:

Jon Snow

Castle Black, North of Winterfell

The North, Westeros, 11122

Date: November 18, 2019

King’s Landing Hospital

The Crownlands,  Capital City

The South, Westeros, 110021

Billing Account Number: 123-456-789

To Whom It May Concern:

This is to notify the Billing Department that I am disputing a charge on my bill, which was dated November 15, 2019. The original treatment was done last November 14, 2019, which amounts to $100. I was admitted to your hospital because I accidentally bend my knee during an unfortunate accident. This required your technicians to take x-rays to fix my injury. However, upon checking the bill, I was charged with Electrocardiogram and some blood tests which I did not take amounting to $500.

Attached in this letter is the copy of the bill that I received with an ECG and blood tests charged into my name. Also attached in this letter is a copy of the result of my knee x-ray after your staff finished my treatment. As you can see, the result sheet indicates a knee x-ray and not ECG.

I would like to request a new bill wherein the ECG and blood tests are removed. I would also like the new billing to be sent as stated by the legal collection laws, which has a 30 days limit upon receipt of this letter.

I hope to hear from you as soon as possible upon receiving this letter. Please contact me at 555-098-1238 or at JonSnow@castleblackmail.com.

Thank you.

Sincerely, 

Jon Snow (printed name with signature)

Billing No.  123-456-789

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What Happens If You Don’t Pay Medical Bills?

1. Late Fees and Interest

Just like any other debts, your medical bill will start ballooning after its due date. The late fees, as well as interest rates,  will start to take their toll, and the longer time that you ignore your obligations, the more obligations you would get. That sounds cliched, but that’s what happens.

2. Credit Score Damage

As mentioned before, an unpaid medical bill will be very damaging for your credit score. According to the NCLC Digital Library, some hospitals will wait for several months before reporting to a credit reporting agency about your unpaid balance. However, there are hospitals that will report after just a month or two. This would make you pay your bills via credit card, but that’s not a good thing to do because credit card companies charge even higher interest rates than hospitals. Instead, you should opt for a bill negotiation and try to make a plan for monthly payments.

3. Hospital Can Decline You Services

When your balance remained unpaid, and you still won’t make an effort to make a compromise, it is likely that the hospital will decline their services to you. Although you can always go to other hospitals, this would be a problem if there are no other medical facilities in your place. However, they cannot decline your right if you need to be in the emergency room, as per the Emergency Medical Treatment and Active Labor Act or EMTALA.

4. Involvement of Legal Action. 

Yes, unpaid medical bills can turn into legal action when the collections agency cannot get any payment, or at least an intention to pay from you. Hospitals can sue their patients for unpaid medical bills, but they cannot really send you to jail. Instead, the hospital can request for wage garnishment, in which a portion of your wage will go directly as payment for your obligations. 

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What Are The Medical Bill Collections Laws?

When the hospital cannot get you to pay your bills, it will likely send your account to a collection agency. After a while, you’ll go to receive a lot of calls from their collection agents. These agents can pressure you, or even insult you to make you pay your dues. In this case, you have the protection of the Fair Debt Collections Practices Act or FDCPA. The collection agency would get in trouble if they call you at the wrong time, if their agent harasses you, or if you’re still contacted when you have your own attorney. However, this protection doesn’t apply if the original creditor (the hospital) will be the one contacting you.

Just like other matters, the collections law depends on the state where you live. There are states where consumers are initially favored while there are other states with weak consumer protection.

There are four areas that state the coverage of the rule such as FDCPA application, homestead and vehicle exemptions, bank account exceptions, and wages. Florida (head of the family only), Texas, South Carolina, and North Carolina require 100% wage garnishment.

Most of the states will take 75% of your wages, except in Alaska, where they can get wage garnishment between $456 to $716, according to Better Business Bureau.

States such as Alabama, Delaware, Indiana, Louisiana, and Pennsylvania will require even your auto as payment with no exception. States such as Colorado, Florida, Hawaii, Kansas, Louisiana, Michigan, Minnesota, Mississippi, Montana, Nevada, Oklahoma, Rhode Island, Texas, Utah, Virginia, and Wyoming will require you to empty your bank account to pay your obligations with no exception.

Are You Liable To a Late Medical Bill?

The truth is, you can actually ignore your medical bill for the rest of your life. However, the fact that the debt is still there will never disappear. If you’re willing to spend the rest of your life with bad credit and receiving harassing phone calls every day, that might be the ideal choice. But honestly, having a bad credit score isn’t worth it.

There is actually a statute of limitations on debt collection, and it largely depends on the state-by-state rules, as well as the category of debt (oral, written, promissory note, or open-ended agreement). A myth that your medical bills will go away after seven years is just a myth. The truth is, your debt will stay, but it will not stay enforceable after a few years.

In Louisiana, Oral, Written, and Promissory Note agreements would not be enforceable anymore after ten years. Rhode Island will stop honoring oral and written agreements after 15 years while Promissory Notes and open-ended agreements will stop in ten years. Meanwhile, in California, oral agreements will stop being enforced in two years, while the rest will be stopped in four years. However, since a lot of people don’t know this law exists, collection agencies will still call them to pay their debts. (source)

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Disputing a Medical Bill

1. Spot Common Coding Errors

Virtually, medical procedures are coded to facilitate collection from insurance companies. But there are instances when codes are mismatched out of an honest mistake. This means that the codes do not line up with your diagnosis and as a result, your insurer will most likely payment upon a claim.

To catch you up to speed, here some of the most common coding mistakes that you need to know, so when you talk to the billing department, you know exactly what to say.

2. Upcoding

This happens when you are billed for a treatment that is almost similar to what you received but is actually more expensive. Ex. When generic medication is billed for a name-brand medication.

3. Unbundling

Where services that should have been billed as a package were billed individually resulting into a higher medical bill.

4. Duplicate Billing

A common computer-generated issue that happens when you’re billed multiple times for one procedure.

5. Mismatched Billing

This happens when the code does not match your diagnosis. Hence, insurance providers will deny the claim and send the bill back to you.

6. Know The Cost of Every Procedure

It is important to know all the fees for every procedure. Being 100% aware of what is legit can help you spot the mistakes in your bill.

You do not have to conduct an extensive investigation to do it. Simply approach your healthcare provider and inquire about the exact prices for each procedure and other associated services. Any provider would be willing to lift the veil on pricing especially during the payment stage.

This way, you will know whether the numbers in your bill are accurate. If there are mistakes then it is time to show your negotiating skills. Here are some steps on how you can negotiate a price dispute.

1. Visit the hospital’s billing department and inform them of the mistake and request for re-adjustment of your bill. If the hospital provides a customer hotline, then make the necessary call.
2. Submit the necessary documentation to support your claim.
3. Wait for further instruction from the billing department as they verify the price discrepancies. Depending on the severity of the mistake, the verification may take one to three days.
4. If your claim is denied, you may file an appeal to the head of the billing department or to its dispute resolution officer. Normally, they will give you a timeline to hear back on the request (typically 3-4 weeks).
5. Make sure to leave an email or a contact number to the billing department. Once adjustments are made, you will receive a notice to make the payment.

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Check If You Qualify For Discounts

There are different discounts that you may qualify for depending on your situation and location. Some hospitals offer charity care programs that allow people with low income to avail 20 to 30 percent discount after what their insurance covers. There are also hospitals that give some discounts to their own employees.

The government have more financial aid programs for people in special situations. Persons with Disabilities (PWDs), for example, are entitled to a certain discount in public and private hospitals under the Affordable Healthcare Act. The discount cover purchases of generic and branded medicines, diagnostics, hospitalization, and rehabilitation services.

Older people (60 years old and above) can avail of a financial aid that covers hospital visits, medication, and nursing home care. Here are some steps you can follow to learn whether you can qualify for a discount.

1. Inform your medical provider of your unique situation. Are you suffering from any kind of disability or have you reached the senior age? Are you a hospital employee?
2. Submit a formal letter of your intention to avail of any of these programs. Sometimes, government initiated-discounts are automatically reflected in your bill.
3. In case you did not receive the discount, do not hesitate to contact the hospital’s customer service representative or billing department then request for re-adjustment if your bill.
4. Wait for the decision and file an appeal when necessary.

~

Does anyone remember that show Married…With Children? I use to watch old reruns of Married…With Children on FOX even though it was a little before my time.

I didn’t always get the jokes back then because I was still picking up English, but I understood the overall plot and tone.

It was a pretty low-brow show with simple vocabulary.

Married…With Children was sarcastic, dark, rude, sad and just downright hilarious in an “I’m going to hell for laughing” way.

Chinese television shows had nothing remotely close to this American classic!

The Bundys are a bitter, hateful and impoverished family.

The entire show series revolved around Al Bundy, a depressed shoe salesman. Peggy Bundy, a do-nothing lazy housewife with a spending problem. Kelly Bundy, the dumb blonde daughter and Bud Bundy, the loser teenage son. The premise repeatedly demonstrates how utterly pathetic all of their lives are: poor, uneducated, dirty, hopeless and…married with children.

Every single 30-minute episode highlighted how awful each character is and they only existed to make each other’s lives a living hell.

Married…With Children was revolutionary at the time of broadcast. Every other family on TV from the Brady Bunch to the Cosbys were seemingly perfect. It was completely unrealistic to the real American family.

I totally agree.

My dad was not an architect or a doctor. He was an Al Bundy. I never cared to watch a full episode of Cosby or Brady. My family was relatable to the Bundys. No Cosby nor Brady was ever being scammed or stabbed on the regular basis to keep my interest.

Can I get a “Wooooooooooah Bundy!” ;D

“That’s Interesting!“

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Financial Bundy Files

On another note, the Bundys of Married…With Children also serves very good examples of very, very bad financial lessons.

I wrote out a long list of things I observed that I believe continued to keep the Bundys poor. My husband looked over to see what I was writing and said, “Phew boy, that is going to be a loooong list.” Ha!

I didn’t have to dig far or research very hard. I mean if you wanted engineer exactly how to build wealth, just watch a few seasons of Married…With Children from the beginning and do the complete opposite of what they did.

~

1. Low Income

AL: Sure selling shoes is fun. But behind the glamour, it’s like any other minimum wage slow death.

The only source of income is from the cursed Al Bundy who works at a low-end women’s shoe store inside a cheap mall.

The gravity of which Al’s life has progressed so far downhill from his high school football days haunts him daily. He is a middle-aged, balding man working at what is essentially a Payless Shoe’s store gig meant for teenagers.

The annual salary of a shoe salesman in 2018 dollars is $36,000 (I googled it.)

It gets worst…Al is not a good salesman and his annual wage (let’s generously assume it’s $36,000) needs to support a family of 4 + dog. He is not motivated to improve his income or care to learn any in-demand skills.

In fact, his job has been demonstrated that it could be done by a chimpanzee.

2. High Spending

To be fair, it’s not just Al Bundy. Every single adult Bundys represents total financial failure.

The matriarch of the Bundy regime, Peggy Bundy, is a lazy housewife who refuses to cook or clean for her family.

She spends frivolously on her husband’s shoe man income and racks up debt that takes Al years and years to pay off.

Another large portion of her spending goes to her eating out while the rest of her family (especially Al) starves to death.

She has no understanding of personal finance and on the rare occasions she does end up forced to work to her dismay…she ends up tricked into some pyramid scheme and drives her husband into more debt.

Some of her highlighted purchases include a $5,000 statue of a Greek God…which she was able to buy with a down payment of $10.

There was also the self-portrait painting Peg commissioned of herself for $2,500 dollars…which Al upon seeing…fell out of his bedroom window in horror.

Her purchases are so idiotic that when the Bundy’s hosted a yard sale to recoup some dough they failed.

When the Bundys couldn’t sell any of the junk Peggy had bought, Al explained to Kelly and Bud the basis of the Greater Fool’s theory. Peggy is the greatest fool as she is the last idiot to buy junk with no other takers.

KELLY: You know, I can’t understand why we can’t sell of any of this junk.

AL: Well, honey, see, lawn sales are based on the Bigger Idiot Theory. You know, nothing’s so dumb that some bigger idiot won’t come along and buy, but the uh, the flaw on that theory is that eventually you get to the Head Idiot, and uh, you call her “Mom“.

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3. Unplanned Pregnancies

AL (to Kelly): Love, hate… look, we’re a family, what’s the difference?

It’s hard to say if Al and Peggy were high school sweethearts from the way they jab at each other. Peggy gave birth to Kelly right after she graduated high school on Al’s shoe man salary. This type of poor planning drove these two newly married people right into the poor house head first. Since money is always tight in the Bundy household, the kids forgo dental insurance and basic needs like heating and food.

4. Car Obsessed

Al purchased a ’65 Mustang with his neighbor and they both spent a fortune repairing it…until the cops showed up and told them that it was a stolen car. Oooopsies.

When Al got tired of pushing his ancient Dodge, he took his secret savings stash of $5,000 to put a downpayment on a brand new car at a fancy car dealership. The dealership overcharged him because…well, they’re car salesmen and he’s…Al Bundy.

But fortunately for pathetic Al…Peggy had already found his secret car stash and spent it a loooong time ago. No new car for Al but he did unknowingly buy back his old broken down car (for more than what he sold it for) thinking it was a trade up.

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5. Loans & Dumb Ideas

What happens when you have no money but can’t curb spending? You fall for cheap and easy money! There are plenty of desperate banks who are willing to loan out money. Everything the Bundys “own” come at a much higher interest rate because they are broke.

When Al borrowed $50,000 from the bank to start his own…shoe emergency hotline (yes, a shoe emergency hotline) it failed miserably.

Al: I’m getting an idea. I’m going to re-invest in my Shoe Line. Al Bundy is not going into the gutter owing $50,000. I’m going into the gutter owing a $100,000! That’s the man you married!

Now since Al is already $50,000 in the hole, he goes out and gets another $50,000 line of credit and put it back into his shoe hotline with a series of hilariously bad 555-SHOE television commercials advertising his shoe hotline business.

It failed miserably x2.

Peggy (attempts to comfort): After all, you lost $100,000. How many men who make less than a fry cook can say they lost a $100,000?

That’s the Bundy way!

6. Criminal Behavior

We would be here all day if you wanted a full list. Off the top of my head…robbing a dead mall Santa, losing their neighbor’s house (yes – they lost an entire house), stealing from little children, dodging from paying taxes, stealing their dog’s identity to apply for a credit card (yes they really did that). That’s on top of the usual casual shoplifting, pickpocketing, breaking n’ entering, encouraging rioting, scamming, and of course the looting.

I mean the list goes on and on. This only covers the adult Bundys…

7. Get Rich Quick Schemes

Every Bundy (with the exception of a relatively clever son Bud) falls for get-rich-quick schemes. Peggy Bundy would be the biggest idiot of course. Their love of lottery scratchers and lotto powerballs come before bills and debtors. Peg loves the lottery. One time, she spent $200 buying a small prayer statue of ‘Tubro’ the Panamanian God of Money to aid her in getting rich.

8. Single Income

AL: Peg, you can stab me with knives, you can beat me with clubs, you can make me open my eyes when we’re having sex but there’s no way on earth you can make me get a second job.

During the late 1980s when Married…With Children became popular, dual-income American families were becoming more and more prevalent and accepted. The “New Era of Women” could now choose a career, a family, or both!

Or you can choose either one I guess, like Peggy Bundy.

To supplement Al Bundy’s shoe salesman income, Peggy could have helped out by getting a job. Instead, she spent the day watching Oprah on TV and eating bonbons. She could have taken the traditional homemaker role…except she spent the day watching Oprah and ignoring Bud and Kelly.

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9. Taking Advantage of Others

The moral of the story for many entrepreneurs is…there will always be enough suckers willing to hand over their hard earn money as long as you target the correct suckers. The world is crawling with them. Look how well Amway and Herbalife are doing! The Bundys not only fall for these get rich schemes, they are also responsible for starting some of these shady organizations themselves. Al was the kingpin of a psychic hotline where they sell lucky numbers and lucky days to gullible callers. When the money flooded in, Al ignores the advice of staying small. He got greedy and lost it all soon after.

10. Poor Hygiene

Not bathing, brushing, flossing, curbing foot odor…generally this is basically the fastest and easiest way to make anyone who meets you wary of your existence. Since first impressions are a big deal, especially for a sales position, it’s not hard to see why Al makes less than a “fry cook.”

11. Bundy’s “Curse” / No Hope

The Bundy Curse is a crutch or belief told most often by Al Bundy. The curse is responsible for ruining every (especially male) Bundys from being truly happy. No matter what potential skill or talent they may possess, the Bundy curse will ultimately make them into horrible failures.

Al strongly believes Peg is part of the curse that makes his life hell because she “wasn’t truly a Bundy, being so only through marriage.”

The curse seems pretty effective.

via GIPHY

It’s hard to imagine robbing a dead Santa, your son as a peeping tom, threatening to call immigration on an innocent Mexican woman, stabbing your husband with a knife fastened to a grocery cart, welcoming prison time because there will be free food…..

To clarify, this show is a COMEDY show

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12. No Education

The Bundys do not believe in education. When Kelly was a first grader, Peggy decided to bleach her hair blonde instead of helping her with her homework.

via GIPHY

Since there is no money or food at home, Kelly goes out with other men if she needed clothes or food. The lack of child rearing and general healthcare is how she developed her dumb blonde persona. Kelly has shown hidden intelligence in some instances but they were never developed or discussed to meet her potential.

Bud Bundy, the remaining male Bundy seed, is crafty and smart. But instead of developing his intelligence or building his confidence, the adult Bundys stole Bud’s scholarship money and squandered it on jet skis and big screen TVs dooming their son’s future forever from a debt-free, college experience. He will owe $25,000 dollars – in 1980s dollars – and work for the rest of his life to pay back the debt that his parents caused him.

(Once again, this is a comedy show.)

13. Bad “Investments”

The Bundys do not invest. There is no money to invest. Moreover, they don’t have money priorities. Before the electricity bill is paid off, Peg has already spent it at the hair salon. Sometimes the Bundys scam or illegal obtain a windfall. The last windfall they received was scamming their neighbor out of $2,000 for a wedding. Al pocketed the $2,000 and paid off a rental property at Lake Chicamocomico.

Unfortunately, Al learns it was a fake retirement property built on a toxic waste dump. It will be uninhabitable until the year 5 million.

AL: What’s five million years in the scheme of the life of one man?

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14. Bad Reputation

The entire neighborhood hates the Bundys. So does lower and upper Uncton England…and every single person who has had to smell them or be near them. They once took out the power of the entire neighborhood during a heatwave and decided to pander in the supermarket. They have a dilapidated house and overall rudeness that lowers the overall property value of the home.

Al was also caught on camera on the evening news for lying to a librarian. Without a single ounce of support from the overall community, it’s hard for a person to get far.

15. Lawsuits

The countless of times the Bundys have been sued by someone or they are trying to sue someone happens so often on the show series that I use both hands to count it. Even though the Bundys lose lawsuits more often than they win them (which is hardly ever) the winning plaintiffs get nothing.

What could the Bundys possibly have any more to be taken away?

There are no ramifications! WIN!

16. Not Eating

Ah, the last thing – bad nutrition I suppose but they don’t really eat period. Since the Bundys do not eat often due to their poverty, when they do get a chance to feast (almost always stealing or scamming) normal spectators are appalled.

To avoid paying for movie snacks, the Bundys wait until the concession clerks turn their back and eat as much as they can so they don’t have to pay.

Have you seen the Bundys eat?

Recommended Reads:

• 51 Healthy Frugal Dinner Recipes You Can Make for Under $2
• 25 Simple 5-Ingredient Meals for Under $5 to Feed a Whole Family
• 35 Scrumptious Meals You Can Cook Under 20 Minutes (20 Minute Recipes)

Summary

I came from a family similar to the Bundys so I hold solidarity there. I grew up watching this guy and then rewatching this guy.

Despite how different – completely different – my views are today to that of Mr. Bundy…Al is still my favorite All-American TV anti-hero. I’d buy him a beer any day and it would be an honor.

So take it away, Al…

AL: “So you think I’m a loser? Just because I have a stinking job that I hate, a family that doesn’t respect me, a whole city that curses the day I was born?

Well, that may mean loser to you, but let me tell you something. Every morning when I wake up, I know it’s not going to get any better until I go back to sleep again.

So I get up, have my watered down Tang and still-frozen Pop Tart, get in my car with no upholstery, no gas, and six more payments to fight traffic just for the privilege of putting cheap shoes on the cloven hooves of people like you.

I’ll never play football like I thought I would, I’ll never know the touch of a beautiful woman, and I’ll never again know the joy of driving without a bag on my head. But I’m not a loser. ‘Cause despite it all, me and every other guy who’ll never be what he wanted to be, are still out there, being what we don’t wanna be, forty hours a week, for life.

And the fact that I haven’t put a gun to my mouth, you pudding of a woman, makes me a winner!”

~

Hiya kids,

I have a guest post from Kris. I enjoyed reading his My Financial Mistake series so this is kind of like the summary chapter after his financial mistakes. He will go over with you guys how exactly his family of 3 got control of their household finances.

 Relevant Reads:

• What Is The Real Cost of Raising a Child (Done Frugally and On The Cheap)
• Got Kids? Check Out These Free Rainy Day Resources for Kids
• 11 Punchable Financial Crimes According to Me
• When Having Too Much Money is Bad (The Cons of Being Rich)
• How To Make a Roll of Paper Towels Last Embarrassingly Long

Intro

Hi, my name is Kris and I write over at Chronicles of a Father with Cents where I chronicle our life experiences and try to provide you with advice on how to reach not only a financial happiness but a lifestyle with some of my interest and hobbies that blend into my financial aspects.  I live in the great but expensive city of San Francisco with my wife, Mother with Cents, and 2-year-old son, Baby with Cents.

You can follow me on Twitter, Instagram, and Pinterest.

From Falling Behind to Getting on Track  

I remembered when I was falling behind in credit card debt and student loans, I didn’t know how to manage my finances. All that I knew was to have a reactionary outlook when it came to paying my bills.

When the credit card statement came or when I got the student loan email notification, I would look at the minimum amount and see I would have enough to pay it off for the month. Talk about living ‘paycheck to paycheck’, this was being in survival mode.

But as the years gone by I not only eliminated credit card debt and student loan from my financial life but also got a better grip on managing the household finances.

Taking the Reins on Managing our Finances

When Mother with Cent and I got married, I figured that Mother with Cents was not the type of person who liked to pay any bills like electricity, internet, and the cell phone.

I remember there were a few occasions during those first few months after we got married that she didn’t know that electricity was due tomorrow or that we had to pay for our monthly internet bill that day. So noticing that she really didn’t keep track of these due dates, I talked to her and said that I’ll take the responsibility to pay these monthly bills. 

I like doing these monotonous tasks because although it seems dull and repetitive to log in and pay them off but I like to know that we won’t be late paying off any bills.  Sure I could automate most of them and not worry about it but I like to see how we spend every month to get an idea on ways we can try to lower our spending or basically be status quo and keep spending the same way.  

I have an email trigger to know that I will have to log in to pay them off. Since we pay mainly everything by credit card, the credit card companies break down our charges by category so I don’t have to skim through every receipt and separate them by category.

This is basically our way of tracking our expenses every month. The first few months doing this felt like it would take forever getting through it because of calculating everything correctly and making sure that the formulas on the spreadsheet are right.  But after a while I started to get the hang of it and now doing our monthly income statement feels like a breeze.

 Related Reads:

• How Much Money Does Our Frugality Save? (Spoiler: $56,000+/Year)
• Eat Ugly, Save Money? Imperfect Produce Review (+ FREE COUPON)
• Everything ‘Married…With Children’ Did That Kept Them Poor

Opening Other Accounts

Once I started to get a good grip on handling these financial responsibilities, I wanted to dive more into personal finance.  So I went ahead and took a personal finance class at a local community college and it led me to get more into it.

And after taking the course, I started to listen to podcasts and blogs and this really helped me learn more about the types of accounts I should open to help generate more of our net worth.  Before all this, all we had was a regular saving and checking account. We would also have some 1 year CDs (Certificate of Deposit) but we immediately closed it after it matured. 

I started to look into a high yield savings account, opening taxable accounts and buffer up my retirement accounts.

Before getting really serious about our finances, I didn’t make a huge contribution to my 401K and had an IRA that was just sitting there with no contributions and getting charged for annual fees. That IRA account was ‘collecting dust’ for almost ten years.

Secondly, I opened three taxable investment accounts, two of them are robo advisors like Wealthfront. The third one a regular one where I pick stocks, bonds, mutual funds and ETFs.

And lastly, with my retirement accounts, I increased my contributions and kept increasing them until I decided to max it out this year ($18,500). With that IRA, I revived it by rolling it over from my previous bank to Fidelity and maxed out contributions ($5,500).

Using Personal Capital to Keep Track of Our Accounts

Now I have these financial responsibilities by having all these accounts attached to our name.  But with these accounts, I couldn’t really be passive about it by not looking at it. And so I joined Personal Capital and started to link all of these investment accounts onto there so I can keep tabs on them

I would log on about once or twice a month and see how my progress was going. With Personal Capital it is so much easier to have all of my accounts on one screen instead of logging into each account and trying to remember the passwords.  And with Personal Capital, it would show my net worth of all of my investments. Having a site like this really encourages me to check in frequently and see what is going on with my accounts.

Trying to Lower Our Monthly Rates

I also like to check in with accounts that we have expenses for like the internet, electricity and car insurance to see if we can get a lower rate for them.

When our internet bill was $20/month I used to call customer service every year to re-negotiate with them to have it stay at $20 a month. I’d tell them that I would go to another provider if they wouldn’t keep their price at $20.

For about three years that tactic worked. But when that fourth year approached, they didn’t cave in and were stuck at increasing our monthly rate to $60.  We went ahead and left for another provider and now paying $50 a month.

For car insurance, I would change our deductibles to see what is best for us and have the prices at a reasonable rate.  Right now we have a pay-per-mile car insurance company called Metromile where we would pay based on how many miles we drive a month.  This is great for us since we don’t drive very often and thus our monthly rate is lower than if we go to companies like Geico or Progressive auto insurance.

Tasks like these make me feel more in tune how we are doing with our finances by constantly checking in like this.

 Related Reads:

• 16 Part-Time Jobs with Good Health Insurance and Benefits
• 6 Biggest Reasons Why Airbnb Is So Popular

Mother with Cents Role

With doing all these financial responsibilities that I am handling, it seems like Mother with Cents has a minimal role in all this but that is not the case at all.

She keeps me aware of any sales that are going on with anything that relates to groceries and clothes/accessories for Baby with Cents, and even rates for CDs and savings accounts.  We would also text me about a local bank increasing their CD rate and maybe opening an account with them to take advantage of the increasing rate. She even informed me about a high yield savings account rate for American Express.

Mother with Cents has a pretty active role in our finances and was the driving force in helping me get to save money.  Persuading me to drop expenses like cable TV, going to the barber to get a haircut, and cutting down on shopping for clothes really helped saved us a lot.  Also, add to the fact that she was barely in debt throughout her life really made me look at money in a different manner.

Although I’m currently responsible for managing most of our finances, she was the one that got this thing going.

Communicating about our Finances

We are pretty much open to our finances and let each other know any big purchases we want to make and if it’s a smart idea to buy it.  We do not really sweat the small purchases like if I want to go out to eat for lunch during work or getting a snack at the market.

It’s the major ones, more specifically anything over $50 that we discuss if we need to make a purchase on it.

After doing our monthly expenses, I would inform her about how much we spend on a certain category especially groceries.  And we would go over them and see if we need to make any adjustments to it the following month. I remember one month that we spend close to $300 and she really wanted to cut down to under $250 or even better close to $200.  And so we cut down to random purchases at Costco and Trader Joe’s and we ended spending just over $200. So communicating like this really helps the both of us know what we need to do to cut down and save.

Whenever I want to open account whether it’s savings, CD or an investment I always inform my wife that I want to open one and put a certain amount onto theirs. That’s when she looks around for rates and see which bank or credit union we should open with. With the investment accounts we have, she would let me handle everything regarding setting it up and the types of investments it should have.  

Conclusion

Being aware of your finances and communicating about it with your significant other really keep everyone involved in what is going on with it.  It also helps that having a someone who knows what their role is key to managing the household finances in an efficient manner.

How do you manage your household finances and your role in it? How often do you communicate with your partner about your finances?

~

This post was written in aggravation at 3 AM by yours truly.

There are barrels of good people out there under a mountain of usurious debt north of six figures. You could argue until the cattle turn into jerky whose fault it is at the core for anyone north of negative six figures to get themselves into that situation.

For me, predatory student lending practices would be my first tick off the row of boxes given. Then you have the medical emergencies, family tragedies, personal struggles, surprise unemployment, and using once so often credit cards to make sure ends meet. These are real-life reasons.

Buuut, occasionally, you come across the special category of not-so-sympathetic ”frivolous” spending that makes it hard not questioning what it is that they’re actually thinking. I personally don’t know anyone who has shopped themselves into a negative six figures (thank goodness) but one beautiful fool who comes magically close to defying all money logic.

This moonchild goes by Soapy.

~

“That’s Interesting!“

• Panhandling: How Much Money Do Panhandlers REALLY Make?
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• 39 People Who Got Richer AFTER Quitting Their Day Jobs
• Can Being a “Friend-For-Rent” Really Make Extra Money?

For those of you who are new here, here is a synopsis of my friend, Soap. She is one of the many colorful characters I’ve noted in my life.

I added this portion so no one is missing a piece of the puzzle:

Soap is one of my best friends. She is also the daughter of a very affluent, multi-millionaire family. She grew up in Salt Lake City. Her childhood was what one would call pure opulence and she had many privileges most people can only dream of.

(Think Crazy Rich Asians…)

Her sister is married to the wayward son of a Chinese billionaire and Soap herself…well, she is in her 30s with a drinking problem. She has terrible health and cannot hold down a stable job. At age 30, she started with $80,000 in refinanced consumer and medical debt and some unpaid taxes as well.

Although her parents can easily wipe the debt away, they think it would be better for Soaps to learn how to manage her own finances by learning to live frugally and focusing on her career and education. Both of Soap’s parents fall under what you call, the sensible rich.

Soapy’s parents immigrated to the United States from China in the 1970s. They’re open-minded and highly educated (in contrast to my own immigrant parents). They educated themselves, worked very hard, and became successful engineers and then entrepreneurs within two decades. Now they want to pass on their successful international trading business but to no heir.

Soap was the only heir of choice but she repeatedly declined to learn her family’s business. Now her parents have stopped asking. To Soaps, her parental life work has no appeal what-so-ever. It is not how she wants to live her life, even at the guarantee of wealth.

Read the complete set of Soapy’s Odessey:

• 21 Frugal Pantry Staples List on a Limited Budget
• Practical Budgets For People Bad With Money
• How To Effectively Overcome Credit Card Addiction
• 3 Signs When Frugality Isn’t Worth It & What To Do
• Why You Still Need An Emergency Fund While In Debt
• How Soapy is Geoarbitraging in China
• What Am I Doing With My Life? I Need Help With My Life.
• How It Feels To Resent Someone For Being Spoiled

~

The Update

Her cell phone service was shut off. The phone company won’t let her get a new phone number until she pays for the old balance and pay for a new phone line to be opened. It will cost $400 from start to finish.

Not having a phone and job searching is obviously a no-go. You need a working phone to look for any job.

But not all of our conversation is surrounded by money or job. She hates talking about it and I don’t want to be a stick in the mud.

Financial responsibility is for those ready to receive it.

We talk more about dreams, food, family, relationships, work, miscellaneous dumb things, and girly stuff — this time, I was chatting about shoes. Just…you know…normal girl talk. 

I didn’t want to make her depressed so any talk not on the subject of money is a better one.

I guess I accidentally pulled her into a safe spot with a mention of sneakers because…she told me about her $800 shoe purchase last month that I was NOT aware of before. 

I guess she didn’t feel like telling me because…well, you can imagine, I would be angry. I guess she treats me like her mother too, hiding bad money and new debts.

“I agree it’s overpriced but I still got it.”

Yeah, but what in the world did you get an $800 one for? What’s wrong with $50 shoes? This is a sickness. It’s sick!

These are “Yeezys” below. (Yeezy = a very overpriced clothing brand by rapper Kanye West. It’s hard to tell if these Yeezys were new, used, or barfed in with the naked human eye.)

We always talk late and I, once again, put the phone down and decided to just not speak to her for the rest of the night until I calmed down. I had to physically SEPARATE myself from my phone in a thwarted attempt not to scream INTO it with my husband sound asleep next to me.

 Recommended Reads:

• The Rent Is Too Damn High! – A Guide To Living In Your Car

Punchable Offense

Honestly, the purchased item in question doesn’t really matter. People have and will continue to blow money on silly crap, that’s not news. I just never known an otherwise intelligent human to be THIS self-destructive. It’s shocking to me.

If you are following along with the saga that is Soap, you may know she owes a bunch of financial sources and friends (myself included) a few thousand dollars that she has not paid back.

It also reminded me of my list of punchable financial offenses. If she told me she bought $800 shoes in real life, I would have slapped her.

I’m not grumpy at this point over a few thousand dollars. If she could be more responsible with her money and cut back, she wouldn’t have money issues.

She was living on cereal for 2 weeks because she told me she ran out of money.

I assumed she ran out of funds…not that she ran out of funds because she spent it on $800 shoes.

By the way, she wanted everybody on this blog who are broke to know how economical and “frugal” it is to live on cereal because a big box of sugar “can last surprisingly long”…

(P.S. her definition of frugal is so wrong. It’s what the common masses THINK frugality is: living in misery because you’re poor. SO FREAKIN’ WRONG I CAN’T EVEN UGH!)

 Related Reads:

• How Much Money Does Our Frugality Save? (Spoiler: $56,000+/Year)
• Eat Ugly, Save Money? Imperfect Produce Review (+ FREE COUPON)
• Everything ‘Married…With Children’ Did That Kept Them Poor

But Not Bankruptcy

Don’t think badly of Soaps. She doesn’t want personal bankruptcy even…though at this point…even I think that’s the only choice left.

Initially, I assumed it’s because her mom is a cosigner for her major debts. With her parent’s wealth and assets, there is no such thing as bankruptcy anyway. But more so, Soap does not consider bankruptcy as an option because she was taught that bankruptcy is immoral.

“It’s…I don’t know…it feels, feels like stealing.”

She was taught to believe that you can’t let someone else handle the baggage. Isn’t that so mature of her?!

Which is even more confusing because if she understands THAT, why dig yourself even deeper then?

SHE’S CRAY!

This is a life staging form of modern art, right?

I mean…it’s NOT “easy” spending $800 on a pair of shoes when you’re north of six figures in debt without a job. That takes an incredible, extreme amount of irresponsibility to throw around that nonsense. This isn’t a money issue, this is a mental issue that…like if we were on Dr. Phil, he would be like:

A reader bought up the fact that she might have a mental illness and initially, I thought “nah” because Soaps is in all areas a very normal, very happy person

When the conversation is not about money, we joke and laugh about typical things. She’s happy with most of her life besides the ‘needing more money’ thing.

But now I’m not so sure. There might be something psychologically wrong with her. No clue what but I can think of 30 different mental barriers a person would need to break to be that stupid. Soap just FLYS through them all.

 Related Reads:

• 3 Signs When Being Frugal Doesn’t Work & What To Do About It
• Why Rich People Penny Pinch When They Don’t Have To?
• At What Age Does Being Broke Stop Being Cute?

Here are the major steps a person needs to overcome in order to be OK with spending $800 on footwear while $100k in debt:

*Give Into Hopelessness

THAT is what makes up a good percentage of debt holders’ mentalities when they’re struggling in $100,000 worth of any debt. Soap included.

It’s so hard with Soaps. I’m split between flaming anger, sadness/pity, and if there’s enough room…a whole lot of disappointment.

But don’t judge her based on that huge number. It’s pretty hard not want to call it quits; unless you’ve been there without a planned path, no one gets to say or pass judgment. $100k is a hugeeeeeeeeee number. If the situation looks hopeless and life is miserable for the near and distant future…what’s another $800 for shoes up against $100,000?

*Maxed Credit Cards? Blow Cash

Look no deeper. Tell the head doctors that they’ve met their match. Soapys money management is something ridiculous. I’m wondering what two wires are touching in her brain that shouldn’t be touching. But I’m the only one here doing interpersonal counseling. If she can get something she wants with the cash she has in hand, that’s the moment that matters and she will get it. Those shoes were good as bought the moment she got her bi-monthly payout from her last side hustle.

Related Reads:

• Would You Survive a Financial Recession If Economic Collapse Happened?
• I Took The 30 Day No Spend Challenge & This Is What I Learned

*Have No Priorities

There is two main reason why people continue to put charges to their credit cards: buy themselves food and electricity to make it through the month OR buy something happy to get themselves through the day. There’s a big difference in paying your grocery bill versus paying for a mall trip. Logically, money goes to groceries first, not Yeezys. Logically, making rent goes before an Icelandic vacation pipedream. (She’s been crazy about Iceland for some reason. Another escapism daydream in this ridiculous artist life.)

I feel like a lot of rich children don’t seem to have a strong sense of priorities. It’s always fun first because the repercussions were never there for them to be afraid of. Because I was poor, I only saw repercussions and no upside. Maybe that’s why Soap thinks I’m a wet blanket…

*Have No Money Sense

Life is like a game of Minesweeper, full of little landmines. You can get better by gauging the potential and likely mines. There’s no guarantee – most of these happen to people out of the blue and once you’re knocked down and it’s hard coming back up. That’s how the system is built, it can happen real fast. My own family was on the teetering edge of every single one of those landmines for…uh, my entire life? I understood that reality since I was 10 years old and I lived with it every day.

Money is either lost or gained. The effects compound regardless but there are only two ways money moves. It takes a strong person to dig OUT of negative six figures and they get bragging total rights. I don’t see it happening here…

 Related Reads:

• 4 Profound Things I Wish I Knew Before Growing Up
• Effective But Semi Illegal Ways To Pay Off Student Loans
• Top 5 Financial Mistakes I’ve Made In My Early 20s

*Eat Cheap to Survive Afterwards

Just a day before the whole “Yeezy” shoe confession, she told me she’s been living off cereal for 2 weeks after running out of money. It honestly pulled at my heartstrings initially when she told me…because I love food. Like…hello, have you met me? I almost PayPal her money for her to buy groceries. But now, after finding out about the Yeezy shoe thing, it would be kinder to just let her starve and learn a lesson.

*Wait for Parental Bail

Her family can be generous. 2 years ago, after her last financial bailout, her mom gave her $20,000 and told her to use the remainder to start an emergency fund and open a savings account. That was the last fresh start she got from her parents.

2 years later, she has doubled that debt with 2 more tax bills that go unpaid. What did she do with the $20,000 her mom gave her for an emergency fund and rainy days?

No one knows, not even her.

She spent it on a new Xbox, knock off hoverboard, random dumb things she can’t remember but she confessed to that it was junk. Not to mention the other things she continues to purchased since then that aren’t necessities.

It’s hard to see a cent from her unless she got a fantastic, six-figure size bailout from her mom but it seems like her mom has had enough of her antics too. There have been too many bailouts to list.

It’s always sad to see parents “give up” on their own kids and this is they’ve basically given up on her / not too sure what to do now. Soap asked me why her mom hasn’t cleared her debts yet when she is clearly struggling. Soap doesn’t understand this but I’m seeing her parents stuck in suspension because they ran out of ideas.

I’m more or less joining her family on that front. I’ve only known her for about 5 years. Her mom and dad raised her from baby to 18. If Mr. and Mrs. Sensibly Rich quit, what’s my advantage for nagging about financial responsibility?

 Relevant Reads:

• What Is The Real Cost of Raising a Child (Done Frugally and On The Cheap)
• Got Kids? Check Out These Free Rainy Day Resources for Kids
• 11 Punchable Financial Crimes According to Me
• When Having Too Much Money is Bad (The Cons of Being Rich)
• How To Make a Roll of Paper Towels Last Embarrassingly Long

Conclusion

The universe somehow placed us together and forged a friendship worth almost 5 years of time. It’s like we’re the stars of an alien reality TV show. I’ve reached a level of Zen with her. I honestly don’t care anymore. I care about her as a living person but I don’t care how she’s going to pull out of this or any hope she can with the actions she’s taken over and over. Now it’s less about how to change her behavior and more “I wonder what season 6 is going to be.”

I hope this was entertaining! She’s the best expert out there at bumming life. Don’t you just love her artistic approach to life? It’s a breath of fresh air in these personal finance neck of the woods, am I right?

We have been using our old Google Docs spreadsheet for over a year now and slowly improved some of its features as we tweaked this and that. We also received some feedback on suggestions to improve. My husband implemented all the reader suggestions in this current revision.

Download the revised budget version here.

I’m not going to pretend I understand any of my husband’s coding gibberish.

 Related Reads:

• How Much Money Does Our Frugality Save? (Spoiler: $56,000+/Year)
• Eat Ugly, Save Money? Imperfect Produce Review (+ FREE COUPON)
• Everything ‘Married…With Children’ Did That Kept Them Poor

Revisions to The Frugal Gene’s Budget Sheet

*Combined the separate monthly summary pages into one single page in a single selectable month. It makes things less cluttered looking.

*Split out income and expenses to separate tabs. Before they were on one page and there was a lot of scrolling back and forth on the page. Plus, when you used the search function, it searched both expenses and income which was unnecessary. Now it’s on a separate sheet for ease.

*Added accounts tracking. Previously, it was done by payment method but now it tracks balances on accounts so you can confirm that everything has been entered correctly. You can also track the balance on accounts.

*Before we didn’t have any tracking on paying off credit card and now there is tracking between transfers to demonstrate that. It tries to track account balance which is more accurate.

*Removed the starting balance and ending balance because it was terribly confusing before. Now it is simply called “Net Saves” (Green Box).

*The ability to rename months without breaking the sheet if you prefer to look at them in non-English languages such as French or Spanish.

*Introduction of “smart average” which ignores months before you started tracking or that is not yet tracked in order to give you a more accurate average of your spending than just the regular average. The regular average is simply divisible by 12 (months a year total) which isn’t accurate if you were, say only in the month of June.

Download the revised budget version here.

Sample Budget Categories

It was my gig to use it and check for any parts that would be confusing or unnecessary. After we finalized and uploaded, I realized we were missing sample budget categories. We were editing on our master sheet which was full of data and forgot that the working template itself was set to blank.

For a functioning budget, the categories of where your money will be registered going to are critical. It’s not as easy as jotting down food, transportation, rent, child care, etc. In order to jump start on a strong foot, you need accompanying categories that work for your budget.

Everyone has different urgencies for categories so I thought it might be even better without a pre-populated list. I decided to include a suggested categories post instead for more customization. There is no rule on organization but it would be good to place the higher expenses near the top and go down from there.

~

Master List of Basic Personal Finance Budget Categories

Housing & Shelter

Housing is easily the biggest expense in most of our budgets and for a very necessary reason. I don’t like nature that much. You can cut down on housing costs if you house hack.

*Mortgage

*Rent

*Property Taxes

*HOA Dues

*Home Maintenance

*Renter’s Insurance

*Homeowner’s Insurance

*Household Repairs

Transportation

If it was responsible for getting you from point A to point B then it goes under transportation. This is usually the 2nd highest budgeted category in an average American’s budget. (Although, me = El Cheapo, thinks it should never be.) A general rule of thumb….if the thing goes ‘vrooom vrooooom!!’ then it’s probably under transportation (except husbands).

*Auto Insurance

*Parking Tickets

*Car Maintenance & Repairs (Oil change etc.)

*Gas

*Tires (Tire chains, etc.)

*DMV Fees & Licensing

*Airfare/Public Transit

*Things (Car deordizers, leather seats upgrades, windshield wipers.)

Food & Dining Out

If it goes in your mouth and tastes good, then it’s probably food. I’m on the fence about cigarettes and pot under groceries but it’s really a personal call.

*Restaurants

*Groceries

*Beverages (Redbull, alochol, etc.) 

*Pet Food

*Recreational

Utilities

This is the category that I personally detest the most. Depending on where you live, these little utilities and recurring bills could really eat away at the bottom line. Always pay extra attention to these!

*Electricity

*Water

*Heating

*A/C

*Sewage & Waste Management

Personal Care

If it touches your body and makes you feel beautiful then it goes in personal care (except husbands). If it trims something ugly and unholy off you then it goes in personal care too.

*Children Clothing

*Adult Clothing

*Makeup

*Skincare

*Gym

*Salon

*Shoes

*Bath Goods

Medical & Health Care

May you never have to deal with most of this on the list but it’s good to come prepared with a category anyway. Always set aside some rainy day money because most of these below are EXPEN$$IVE.

*Emergency Urgent Care

*First Aid

*Survival Kits

*Health Insurance

*Primary Care

*Dental Care

*Misc. Care – (podiatrist, optometrists, etc.)

*Medicine

*Disability Insurance

*Medical Devices

*Pet Insurance

*Long-Term Care

Household Staples

We personally don’t separate toiletries from groceries because it’s an inconvenience but if you want to flush and curb food costs, it would be wise to take these out.

*Toiletries (Napkins, kitchen towels)

*Laundry Detergent

*Dishwasher Soap

*Cleaning Supplies (Trashcan liner, compost bags, etc.)

*Mechanic Tools

*Small Appliances

Entertainment

The level of spending could possibly push some of these sub-categories into areas that pertain more towards fun money depending on each specific person’s financial situation but in general, entertainment includes (at least in our case) new computers, headphones, and board games.

*Phones

*Cable TV

*Home Internet

*Outings

*Concerts

*New Computers

Fun Spending

There is no definition of free money besides the amount you allot for yourself and whatever you want to do with it. Nothing wrong with having some “extra” money to blow off steam if you can afford it. The keyword is ‘afford.’

*New Car Fund

*Goat Pellets

*Vacation

*Games

*Spas

*Cable/Netflix

*Extracurricular Activities

*Anything

Charity Giving

Giving doesn’t have to come with a plan, make room in your budget for spontaneous giving as well as donations, tithing, and supporting your beloved content creators.

*Donations

*Tithing

*Patreon

*Holiday & Birthday Occasions

Family

Having a family comes with a set of costs too and this category is a less commonly discus during the budget set up the process but it’s necessary to track these expenses if you have them.

*Life Insurance

*Child Care

*Alimony

*Senior Care

*Pet Care

Education

I sometimes catch myself concerned with the overall education quality of public schools, especially in cities with poverty and funding issues. No one can deny that kids are indeed very expensive

*Private School

*Private Lessons

*College

*School Supplies

*Books

*Subscriptions

*Day Care/Babysitting

Gifting

Sometimes special occasions like Valentine’s Day sneaks up on you so tracking this category will give you a better idea what will eventually happen again. (Not sure if everyone knows this but Christmas and New Years happens every year. Around the same time too!)

*Holidays & Birthdays

*Wedding

*Anniversary

*Special Occasions

*Christmas & New Years

Financial

*Income

*Retirement

*Consumer Debt

*Emergency Fund

*Savings

Miscellaneous

*Everything else (identity theft protection, that time I had to buy a rope because it’s generally good to have a rope around, fridge magnets, clips for chip bags etc.)

Note: Woop! That was a lot of categories and things to consider. No wonder saving money might not come easy, look at the number of things tugging at your dollar for attention! This is more reason why everyone needs a budget so download the revised budget version here or get started going traditional with a pen and paper. They’re both good as long as you’re tracking where your money is going.

~

Adding More Categories

You can insert some new lines by right-clicking on the row numbers to the left and inserting a new line.

If you insert new lines on the setup page somewhere in between the first mauve row and the last mauve row, the functions that make the other pages work will find it correctly.  Note that if you insert a new line just after the last mauve row, it may look correct, but the values for it won’t update on the other sheets.

If you’re adding more lines, you may also need to insert new lines in the appropriate sections of the monthly and annual summary pages.  If the calculations don’t work for any of the new lines, you should be able to copy paste from one of the working rows in the same section without needing to make any additional changes.

~

Saving your own money for college does a lot more than just paying the tuition. Spending your own money teaches you about the value of money, provides a safety net, and gives you a preview of the working world. I’ll tell you my experience of going to college as a low-income student and how I navigated my way through. You might think this story starts at age 18 but my college prep started long before 18, and I didn’t even know it.

I held two multimedia based internships from the time I was 16 to until I went off to college:

*During my first internship, my class was paid to learn how to make our own video game in Maya 3D. I designed a 3D island and animated my own space station on giant Mac OS X Leopards. I also came up with the phrase ‘pinwheel of death‘ long before it became popular. It was an amazing opportunity. We were allowed to enter the UbiSoft office in San Francisco and poke around after school. We were given free video games! I was very paid well for that 8-week internship.

*My second internship was at an independent advertising design studio. Our medium was Adobe Illustrator and Photoshop. A year later, when I was offically in college, my late mentor told me that my (and other students) design was being hung in the streets of New York City for the Urban Forestry project. The project was successful funded and I was paid $600 for completion.

 Recommended Reads:

• Why ‘The Millionaire Next Door’ is a Myth to Most Millennials
• Saving Money For College Does More Than Pay Tuition

The College Years

As an 18-year-old college freshman, I had around $5,000 in my saving account that was 100% my own money and no one had a clue I had any.

Even more importantly, that money in my bank account gave me the seed money that I needed for school books and dorm room furniture -without- having to touch the credit card my mom opened for me.

It would have been really hard to ask my parents for money. At the time (around 2009), my mom was let go from her nursing care agency due to a workplace injury she sustained at a client’s house. Money for everybody was only getting tighter during the Great Recession.

Thanks to the $5,000 in seed money, I never had to touch that credit card very much. Because a lot of transactions were never as easy as swiping a card. I saw the money leave my checking account almost immediately; it did not take long for me to realize I hated the feeling of my cash leaving. I was naturally frugal during school, I never felt tempted by cars, and I did not have to pester my parents for money.

By junior year, I was able to score another temp media gig in the university computer lab. That stint replenished my diminished savings which were down to a little over $3,000 back up to $5,000 and beyond. I sustained that amount until the end of my university career.

 Related Reads:

• 4 Profound Things I Wish I Knew Before Growing Up
• Effective But Semi Illegal Ways To Pay Off Student Loans
• Top 5 Financial Mistakes I’ve Made In My Early 20s

The Adult Years

I met my school credit requirements and chose to graduate early in 2012 in an effort to curb my college costs. The end was in sight. I decided to skip the formalities of graduating with my peers. I gave myself a head start job hunting before every new graduate hit the job market.

Related: How I Paid Off $20,000 In Student Loans Working Part-Time

When my first loan repayment arrived, I was able to create a soft landing with that $5,000 in between my first real-world paycheck and my first student loan payment. 

It’s hard to imagine how ugly things could have turned out if I was not so fortunate to have learned the value of money early on.

*Did you know that the average household with revolving credit card debt pays $904 in interest only per year?¹

*Dropout rates of 16 to 24-years-olds who come from low income families are seven times more likely to drop out than those from higher incomes families.²

*50% of students who drop out of college have income under $35,000/yr.³

Being in control of finances, making and saving your own money should start long before students enter college. Unfortunately, this is lesser known advice compare to the general pressures of going to college felt by teenagers everywhere. Good college education serves an enormous purpose in educating the young but I do wish financial education was taught beforehand.

I was told over and over that without a college education, I would have no future. But I was never told that without a financial education, I would never know the beauty of a sound night sleep or the comfort of monetary stability without a life of servitude to creditors.

~ 

This post was written for this year’s CFSI: #FinHealthMatters as an effort to curate student financial awareness.

A majority of Americans are financially illiterate.¹ That means if you offered them an 8.56% interest rate on a used car,² most of them wouldn’t know enough be able to scream and run away ASAP.

Is not possessing the basics of financial literacy an excuse? This is one of those things that I am sitting on the fence about.

I would love to hear all sides. Welcome to the open place to bounce around what you think!

First things first, there are only two principles of wealth after you get that money in your hands.

*The first thing is to save it.

*The second thing is to invest it.

Personally, after a lifetime of living on the edge, the savings part was a no-brainer. I welcomed my 22(ish) years on planet Earth with a healthy $20,000 net worth and zero debt. That’s straight shootin’ for a kid that came from the bottom 10% rung (brag, brag, brag).

But I still classify myself as financially illiterate. If I had been financially aware then the smarter thing to do would be reserving $7,000 for a 6-month emergency fund and invest the beautiful $13,000 and change remaining into a rolling bull market in 2013. Ack, I could have doubled my pennies since 2013! I didn’t know. I didn’t know!

What Do You Think?

YEAH, EXCUSABLE.

Late & Foreign

My family was non-English speakers in a new country. Almost everybody living on “the wrong side of the tracks” all carried some form of financial ignorance. For my family, saving money was possible with some extreme frugality that I’ve been accustomed to, but unfortunately, saving was all they did. A buck here and there, brick by brick, to build a tiny ineffective nest egg. The money didn’t grow. It only shrank with time.

And that is the tragedy. Why didn’t they invest?

Learn to invest? From who in the same mugwump immigrant community exactly? Also with what money?

Read a finance book? They can’t read.

Go online? Um…my father doesn’t know how to operate a mechanical pencil. He calls the computer a TV.

I feel like in my parent’s case, there is a workable defense on why they remained financial ignorant. They had to fight EXTRA hard for something. They came to America in their late 40s, didn’t speak the language and they got some dirty ass looks for being different. It wasn’t just adjusting to finances, it was adjusting to every single new thing from language to culture to work. Those are pretty high stakes to kick down for someone nearing age 50.

Closed Information Bubble

Mr. Executive told me how he grew up in a quiet gated suburb on the east coast with a great school system, and he hated it.

“You know how people in some small towns tend to think alike, dress alike, talk alike and even look alike? That was one of those of those places. There was nothing to do and everyone was the same.”

I’ve always had a lovely mental imagery of small towns but Mr. E did freak me out a little with his rant. Everything rude that he says…does have a point. He’s not one to sugarcoat anything, that’s why he’s an effective entrepreneur.

I have this theory that might already be a theory…but I swear I came up with this on my own. Basically, human communities are hive minds. We are submerged in information and we’re learning constantly, CONSTANTLY. We just don’t know it because we are processing them in the back of our minds. If both your mother, aunt, sister, tranny granny next door were skilled financial businesswomen, then you wouldn’t necessarily be completely blind to the financial dictionary even at the tender age of 7. But in a small rural town where the main source of revenue was ice fishing then you would be naturally further away from understanding finances way past the 20s and that would be excusable.

So this closed information bubble draws out a lot of drive to even start to learn/the importance of learning something.

Straight-Up Predation

There are rat bastards out there who are willing to screw a 17-year-old out of their life to line their own hefty pockets. A lot of them are in the education business. We sell the big career dreams to those who are misinformed and desperate for betterment. The loan sharks profit off financial illiteracy and they hurt perfectly good, young people with financially illiterate parents (like mine) from illiterate communities (like mine). It has nothing to do with intelligence or education, it’s just bringing the sheep to the slaughterhouse and the sheep simply don’t know any better. You can’t blame the poor thing. We were bought up to obey and trust adults, counselors, administrators, and authority.

 Related Reads:

• 4 Profound Things I Wish I Knew Before Growing Up
• Effective But Semi Illegal Ways To Pay Off Student Loans
• Top 5 Financial Mistakes I’ve Made In My Early 20s

Data Convulsion and Confusion

There is a lot of differing financial information out there. It might not seem like it but Google can spit back different kinds of information depending on your phrasing and word choice. It creates an echo chamber of sorts. Some money gurus argue against contributing to your 401k and gets a lot of support for it!

You have to know what to Google before you Google it. You need the baby vocabulary there to start learning. Plus, there are lots of different schools of thought on investing and it’s not a one size fits all deal so it trips even more people up.

But is saving money for a rainy day really that much off from common sense? I swear I have the frugal gene because I never thought it was ever, ever, everrrrrrrrrr a good idea to spend ALL your money. Even when I was playing pretend, I held onto 20-40% of my imaginary cashier money.

Even if you left me in a financial black hole, I would have tried to ROCKED it out as frugally back then just the same as now.

Oh wait….yeah, I DID DO THAT.

All debt free and $20,000+ saved before turning 23! I didn’t have a car even back then in college. And it wasn’t because I was privileged to live in San Francisco. I attended university in a DIFFERENT not-at-all walkable, middle of nowhere (unless you count pee puddles) barn town and I did it CAR FREE. I chose the car-free life, even back then. I forgot to mention that before! Saved me a bunch $$ at some minor inconvenience. I graduated with less debt – even though I made a mistake in attending a private, more expensive university. I hustled it hard back and I sacrificed during college too. That was not financial literacy, that was just common sense that owing someone something as important as…money IS super bad!

Which leads me to….

VS

NOT EXCUSABLE, WERK IT OUT.

Why Should ANYTHING Be Excusable?

Believers of Free Will, you have to take personal responsibility. There’s this thing called “individual difference.” This “individual difference” is why some people argue that the social sciences are not really science. Some people come above their variables of utter shit and some people don’t. The biggest driver like I said in my previous post is the difference in coping mentality, loci of control, and temperament. Splash of luck too. OH and personally, how hard you’re gonna pivot to make something advantageous is what I consider a factor.

Pivoting Your Ass Forward

If we had a word of the week for you guys: this week is pivot!

Pivoting is something successful people are good at doing. Not everyone comes into adulthood knowing what they will or even want to accomplish with their life. Steve Jobs bummed around campus barefoot until he decided he wanted to do something with computers. This other Steve guy, from Think Save Retire, makes an argument for pivoting. I remember that was the first time I’ve heard of that word being used in a sentence that was actually pleasurable to the ear. What a beautiful word for a beautiful motion. Bloggers from our own community have done it themselves in their own respective careers and written about it. There’s more than one way to skin a cat. If there’s a will, there’s a way. If life zigs, you zag! Etc. All of those corny one-liners.

 Related Reads:

• 9 Money Mistakes To Avoid For Debt-Free Living
• Don’t (Nicolas) Cage Yourself In Financially
• 4 Practical Budgets For People Bad With Money

Info’s Out There, Man

One of the main arguments against financial illiteracy is this: the information is out there. Pockets of mental gold await you at your local nerd squad headquarters. ANYONE can walk into the library and check out any book in the money section.

(Except me…I was busy being a typical Asian teenager so…to the manga and anime section! Hahaha.)

The good thing is you don’t need to reach for much. All personal finance books are more-or-less basically the same. I fretted more over a single physics sheet of homework than books about how to save money.

If you are thinking first about your money’s intention, you will one day go, wait…what do I do with this money besides saving it? From there, you’re about 2 skips and a hop away from investing. There will be some investing fails. Everybody has an investing fail story. And I think that’s beautiful because it shows we’re all human.

VS

UNDECIDED & CONFIDENT 

This is where I am. If it was up to me, I would choose the case to case basis.

I keep going back and forth, back and forth like that crazy ride in the amusement park. You know the one shaped like a giant Viking ship and all it does is swing back and forth big time? I hate those. I love roller coasters but this ride just BACK AND FORTH, BACK AND FORTH. It’s nauseating and boring at the same time.

That’s why I went through the hassle of trying to poll everyone on Twitter because I can’t make up my mind…and now I know it’s OK not to. I can see the poll results and the numbers are pretty darn close. If you have a Twitter account then cast a vote for your opinion here or retweet to share. I accept comments below too!

This section has a point to it. You’re this if you are stuck on the fence like me AND also believe that the correct answer is always going to be somewhere on the fence. I know this is the no-fun answer (who wants to be undecided) but a lot of life is muddy. SEE WHY IM ON THE FENCE.

MY PARENTS’ OWN ILLITERACY

This only applies to my situation growing up so there are lots of different ways to go at it in your life but….it’s good food for thought!³

My parents are both largely illiterate (not only financially, they can’t read or write English period.) My father is much more illiterate than my mother.

When I was in middle school, my mother took English night classes after her grocery job. She had her notebooks filled with words like “cat” and “pencil” in a 1st grader workbook. I remember looking sadly over at her at the table trying to piece together words that a 6-year-old American child knew.

I thought to myself,

“This is kind of depressing…seeing your mom rack her brain to spell out the word Pencil.”

She was almost 50 years old. How long was learning English going to take? Even if she managed to grasp basic of English and sentence structure, what was she going to do with that skill?

It’s gonna be another minimum wage slave job. But she won’t be cutting vegetables, she will be answering phone calls and writing down memos…and you know what?

Even that was a helluva step up!

So she went for it. She bought her pencil case and booklet and filled out all the assignments for her adult education class.

She talked my father into going too but he quit after 1 class session. On top of the fact that he was not the sharpest tool in the shed, he was also very reluctant to learn.

He used his age as an excuse.

“I’m too old, too old, the brain is not going to learn anymore.” x10 times every single time he was asked to attend class.

But what I did was worst. I didn’t encourage MY OWN MOTHER to learn or continue her education either. My thinking was the same as my dad (to my poor mother’s dismay.)

I didn’t say anything discouraging to her really but I didn’t say anything ENCOURAGING either.

I thought…you’re 50 years old, what in the world is learning “cat” and “pencil” going to help you with anything in life right now? I was lukewarm in her strives to better herself and her own education. I should have encouraged her more, but at the time, it seemed like an uphill battle.

When she told me she stopped going I just said, “I don’t care.” I was very, very, very apathetic. I knew by then my family was poor and realistically my future as an artist was a pipedream unless I wanted to starve. SO WE BOTH QUIT because we gave ourselves an excuse.

I’m not saying it was an illegitimate excuse. It was probably good I didn’t become a starving artist, racked up debt on a studio art major’s salary. I LOVEEEE MONEY. But I wish instead of making an excuse to quit drawing and painting I pivoted instead. I was a very all or nothing turd teen. I gave myself the excuse to quit, which I should have never done if I didn’t allowed for that excuse!!!

 Relevant Reads:

• What Is The Real Cost of Raising a Child (Done Frugally and On The Cheap)
• Got Kids? Check Out These Free Rainy Day Resources for Kids
• 11 Punchable Financial Crimes According to Me
• When Having Too Much Money is Bad (The Cons of Being Rich)
• How To Make a Roll of Paper Towels Last Embarrassingly Long

So yeah, that’s a regret. IM REALLY SORRY MOM. You would be a fluent English speaker if it wasn’t for your crappy family.

So yeah, this illustrates the gray area beautifully. Financially illiteracy can be excusable but it is not an acceptable course of action for the individual to lay down and go “whoop, I’m excused!” (Not the best choice of wording here but I’m sleepy.)

If a person wants to learn, and I mean, they’re REALLY determined to learn then the information is out there. You would need a lot of determination and yeah – there are some really shitty, near impossible “mountains of crap” in the way BUT anything is better than using “mountain of crap” as an excuse.

This applies to personal finance the same. Yes, it is excusable…but not really and let’s definitely not call it that! It does no personal good to be “excused.” We have to tell each other to keep going and pivot when necessary!

Here’s the end result of someone who didn’t take the excuse vs someone who did take the excuse:

*My mom can understand 2nd grade level English. She studied and picked up some things along the way with her electronic dictionary. Today, my mother can look at a tax document and know it’s about taxes. She can look at a hospital bill and know if it’s a bill or just spam.

*Today, my father continues as a 100% illiterate and dependent on my mom and/or me.

So the difference between my mom and dad is not going to be a life-changing or career-changing difference but one is still much better than the other with just a little more effort in simply believing what a person can or cannot do.

Would you rather be frugal and work overtime to be $2,000 in debt vs no overtime and hovering up and up from $4,000 in debt?

That’s kind of an amazing difference, right?

Anyways, I don’t have the answer. It’s just a fun topic to discuss, there’s a little poll going on Twitter. I set up a new one here if you wanted to vote!

[socialpoll id=”2497951″]

[1 week later]

Twitter Poll Results and Part 2 Here!

You know what they say: there’s more than one way to skin a cat!

(No one says this. Who says this? Why is this a saying.)

It’s a gross way of saying there’s more than one way to reach your goal. So if you want to save money faster and you’re feeling like an adventurous, modern-day Viking you would be a good candidate to go aboard for some geoarbitrage.

 Related Reads:

• How Much Money Does Our Frugality Save? (Spoiler: $56,000+/Year)
• Eat Ugly, Save Money? Imperfect Produce Review (+ FREE COUPON)
• Everything ‘Married…With Children’ Did That Kept Them Poor

What is this scary ‘geoarbitraging’ word?

In layman’s terms, it’s the nuclear option. In personal finance terms, it means taking advantage of the higher living costs in one particular geographic region, skipping town on that noise, and moving to a different geographic locality where things like rent, food, transportation, utilities are less expensive.

That is what Soaps just did.

For those of you who are new here, this is a brief synopsis of my friend, Soap. I added this portion so no one is missing a piece of the puzzle:

Soaps is one of my best friends. She is a free-spirited, creative genius. She is also the daughter of a very affluent, multi-millionaire family. Her childhood was what one would call pure opulence.

Today, she is in her 30s with a drinking problem. She has terrible health and cannot hold down a stable job. At age 30, she started with $80,000 in refinanced consumer and medical debt and some unpaid taxes as well.

Her mom is her loan cosigner. Although her parents can easily wipe the debt away, they think it would be better for Soaps to learn how to manage her finances herself by learning to live frugally and focusing on her career and education. Both of Soap’s parents fall under what you call…Normal Upper Middle Class People.

Soapy’s parents came to the United States from China in the 1970s, educated themselves, worked very hard, and became successful engineers + entrepreneurs within two decades. Now they want to pass on their successful trading business but to no heir.

Soap was the only heir of choice but she declined the offer to learn the family business repeatedly and her parents have stopped asking. To her, their life work and success was not meant to be her life. It’s not how she wants to live. She is like a Beat Generation character that I’ve only read in a raunchy adventure fiction.

Soap didn’t know how credit cards worked until she was over 17 years old. For 17 years, she didn’t know that credit cards cost real money.

“It was my mom’s card that we could buy anything with and the store gives it to you. I didn’t know it cost money money, I didn’t think about it. I thought the card told the store clerks what a good person you are and they give it to you because…you’re a nice person. Hence the name CREDIT – like good karma = good person = stores will give you stuff. No one told me you had to pay it back with money.”

This is why I am an absolute advocate for teaching personal finance in both home and school. That and learning to say “no” to children so they would never end up in an environmentally induced bubble. I started a basic personal finance series in hopes of spoonfeeding her frugal slices of life. My goal was for her to read and apply some of the traditional ideas inspired off Suze and Ol’ David Ramsey. I believe her upbringing was so “generous” (in comparison to mine) she ended up with bad self-control and money management skills.

Read the previous posts in Soapy’s Odessey:

• 21 Frugal Pantry Staples List on a Limited Budget
• Practical Budgets For People Bad With Money
• How To Effectively Overcome Credit Card Addiction
• 3 Signs When Frugality Isn’t Worth It & What To Do
• Why You Still Need An Emergency Fund While In Debt

Geoarbitrage for Debt

I am a fan of geoarbitraging. It seems like an underutilized money hack especially if you have short-term money problems. Fine print though, it’s for those without a geographic obligation such as work and family. If you are able to work location independently and want to save money, as fast as possible then a savvy move would be to take your first-world salary, go abroad, and live like a modest prince for cheap while stocking up enough in savings.

Most smaller cities in China will find first-world American salaries generous in comparison to the yuan salary (Chinese dollar).

The next thing you know you’re living in a pimped out mansion in a third-tier, small city in China!

No, no – it’s not that easy. China limits multi-entry tourist visas to 90 days and you would have to leave and can re-enter after a certain time.

Soap works as a seasonal freelancer and her work is greatly affected by seasonal changes. After business expenses, she is making a few dollars above the Canadian minimum wage. I’ve minorly brushed up in the past that we have been in business together at one point, very briefly, that was not successful.

A month back, Soap was at life’s crossroads. She is about $80,000 in debt the last time I checked with her. Although her parents can pay it off easily, it was understood after her last bailout 3 years ago, it would be her last bail and they stand firm on that decision today.

Compare to 2 years ago, personally, she definitely has become better at controlling her finances. I’m going to take 50% of the credit for that by the way!

But it’s not really enough.

Here’s the debt trap, it’s not enough if you dug yourself that deep. Take for example high-interest rates credit card debt or unshakeable student loan debt, yuck! Debt doesn’t have to give anyone second chances by the way. Now we’re back to basic personal finance, the two subjects that are so wholly simple and basic:

Related Reads:

• Debt and Suicide – Why I’m Proud To Be A Grown-Up Tattletale
• The 11 Perks of Growing Up Poor

How do you get out of debt? 

1. Cut expenses.

2. Make more money.

Besides lucking out on an inheritance or robbing a bank, those are pretty much the two choices for 99% of people out here.

Naturally, if you can’t cut your expenses and you can’t make more money then the debt stays where it is or get even bigger and that is where Soapy’s problem comes in. That’s where a lot of people hit that familiar old problem.

For all the years that I’ve known her, Soapy has just been tangling between “almost barely bankrupted” and “barely bankrupted.” There could be progress made, then she gets sick out of nowhere and right back down the debt hole she goes. You can’t save up enough money to better your situation because it’s locked in keeping interest and debt collectors at bay. Not to mention there’s the tax bill that hits her as a freelancer. Trying to somehow increase an unstable, freelancer’s income, account for taxes, late bills, late rent, find food etc. by yourself with is tough.

When she did put the pedal to the metal and doubled up with a normal 9 to 5 job on top of freelance work, her commute extended, her health declined, and her freelance work quality declined as well. I felt bad for her, I was lucky if she had the time and energy to send me a text. And wouldn’t you know it, after the second week, she fell ill with a lung infection and had to call the temp job quits.

Rinse and repeat, year after year, the story repeats itself.

Soapy’s Expenses

There are moments when Soap tells me her master schemes on how to hustle some money and I shake my head in horror. But this instance, I was fully on board with her idea of geoabritage. She didn’t know that fancy word. She just told me her grandparents invited her to vacation for 2 weeks in China but unbeknownst to them, she’s wasn’t going to be coming back with them!

There were a few bumps in the road I was worried about but it’s this nuclear option or keeping her on that miserable debt treadmill so I gave her my blessings.

Item	Costs in China (YMMV)	Original Costs (Monthly)
Housing	$0-$200 per month	$1,000
Transportation	$2-$5 per taxi ride	$300
Food	$100-$300 per month	$2,000
Health Care	$100 per doctor trip	Unspeakable
Internet + VPN	$150 unlimited mobile data per month + $10 VPN	$0
Electricity	$10 per month (The only service she has.)	$0 (with rent)
Mosquito Repellent	Priceless
Soap Total	$565	$3300

Cost of living in China, just like the U.S., fluctuates wildly depending on the specific location.

*Chinese first-tier metropolis cities like Bejing and Shanghai are the American equivalents to Washington, D.C. and San Francisco. These overcrowded Chinese cities are VERY expensive unless rent became free. Geoabritaging in larger metropolitan cities also come with health issues attributed to the air pollution.

*A large second-tier city is something along the lines of Guangzhou and Shenzhen.

*A third-tier Chinese city like Shenzi is the one Soap currently lives in. Shenzi most actively reflects the power of geoabritage in a small-sized city for those who are location independent.

Soap’s sleep and wake schedule are pretty backward now but I was able to get in contact with her with WeChat (Chinese messenger.) She gave me a quick rundown of her expenses in her a small “third tier” city in Shenzi, China.

Housing

Soap lives rent-free in a semi-abandoned building belonging to her parents family. It has been sitting empty for 2-3 generations. Her apartment has no shower or kitchen. It might sound really weird to Americans to have an apartment without a shower and kitchen but that’s how old the property is. There isn’t really an “up to building code” standard in China. No one is going to fret about how many inches the handrail needs to be away from the wall (which was something incredibly stupid we had to deal with in Seattle…) but in another sense, no one will bat an eye if you have no running water or heat.

But it’s free!!

Her small room in a split house between 4 other roommates in Toronto costs about $1,000 a month so that’s a $1,000 in the pocket.

The Shenzi city rent costs (at the upper crust) only $200 USD per month. That $200 USD will get you a really fancy, furnished apartment with your own shower and kitchen.

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Transportation

Most people walk and bike, which is a cost-effective way to get around. There are city buses that will set you back a few quarters. A private taxi service (similar to Uber) takes you anywhere in the city for $5 USD. That’s considered expensive in China because petrol gas costs are high; however, from a tourist perspective, a private taxi in China is about the same price as a round trip bus ticket back home and it’s much cleaner and faster.

Food

Soaps food expenses are usually ridiculously high for just her. She met with recent success in bringing her overall food costs down. Unfortunately, not long after she implemented my grocery hacks, she got sick again and slid back down…again. Typically, she spends about $1500 on food and eating out alone – just herself. If you include her favorite Jack Daniel’s and Red Bull, then kick it up to $2,000 a month.

In China, she lives mostly on street food. The street markets in China are super inexpensive. You can get street skewers for a few pence. For $2 to $3, you can eat from any street vendor until you’re stuffed. Her food bill is on the higher end of the local spectrum because her free apartment has no kitchen or sink to clean up. A hot pot buffet in China runs about $10 USD (there’s no tipping in Asia in general.) Her dining out bill comes out to be about $200 USD a month compare to her $2,000 bill in Canada. But western food, even bad western food in China is expensive. A Westernized McDonald meal in China will run about $6 USD for a Big Mac meal (with bubble tea instead of soda).

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Personal Care

So I mentioned before, her apartment building is old and there’s no kitchen or shower…which means that she needs to find public bathhouses for personal hygiene. Although it is not a lot of money for her to go to a public bathhouse, bathhouse costs do add up. Back in the states, Soapy bathes 3 times a day, that’s her habit but she can’t do that anymore.

The Chinese bathhouses don’t match exactly the definition of bathhouses in the states. It’s view more as leisure recreation activity like a spa with a pool etc. Public bathhouses also serve food for 3 meals a day. For entry to a bathhouse, its around $10-20 USD and that includes 3 full meals and a bath.

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Health Care

The one huge downside of arbitraging in China is if you have a weak immune system. Her exposure to street food cleanliness and allergies certainly don’t help.

Within a day of landing, Soap was hit with a cold and the stomach flu. She spent two days vomiting and the rest of the week with a bad cold. As she got better, she was hit with an ear infection. That took another week to recover…and then she was hit with a mild cold after that. Finally, her immune system stabilized but she missed over 2 weeks of “family vacation” waiting for her immune system to adjust. Apparently getting sick like this happens to every time she re-enters China.

During that time, she refamiliarized herself with the cost of a typical doctors trip. The good news is if you want to see a doctor for anything, it will cost no more than $100 USD per visit. That includes everything too – the doctor appointment, medicine, shots. It’s manageable on her arbitraged first-world salary.

Internet

Soap would make a great vlogger!

Good internet where she is is expensive. She pays $150 USD a month for unlimited on the go internet, we were able to video chat without disruptions. She needs a VPN for work thanks to China’s great firewall and that’s an additional $10 USD per month. Again, depending on how you frame it…if a fancy apartment cost $200 USD per month that means the Internet might be a costly luxury for some.

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Electricity

Electricity is Soap’s only utility since she’s living without a kitchen and shower. It’s cheap ($10 USD/month) but it’s a bit scary to use. Nothing is guaranteed to be “to code” especially in a semi-abandoned family house so it pays to be extra careful.

The outlet wattages are also higher in China compare to the states so if you get zapped, it’s not going to be a tickle – it might just knock you dead.

Conclusion

Those numbers are pretty much her main expenses in China. I don’t know about you but after learning anyone could get a fancy penthouse for $200 per month, I’m drooling. Even if you’re only allowed in for 90 days, that’s some frugal lodging! Needless to say, she will be saving close to $3,000 to $5,000 a month if she chooses to geoarbitrage in China on her first-world salary. If she stays there, the chances of her knocking out her loans are very good.

If she was back here, she wouldn’t be able to get that jump-start going because her debt would simply keep her running in place. And I think that’s the most important thing people forget about those who carry debt. No judgments here. I know that if I was in her position I would absolutely geoarbitrage a hundred times over. I would grit my teeth for 5 years and come back with some savings and a career plan so I can move on with my life.

Readers, has anyone relocated themselves overseas to save more money? What was your experience? Would you hack living in a small city in China to turbocharge your savings? Is not having a shower or kitchen a deal breaker?