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Saturday, October 27, 2007

SPIRALING DEBT IN OUR COMMUNITY:
Another Yated Readers Write Letter

My comments in orange once again. See the Original Article by R. Avroham Birnbaum as well as one other response, "Debt End," that I've posted to date.

Dear Editor,

I was very happy to see the article "Dying To Borrow," by Avrohom Birnbaum, that addressed an issue which has become increasingly more common and devastating in our community: spiraling credit card debt.

He accurately described the dangers of owning "plastic," namely a false sense of security that leads to spending beyond one's means, and then the deathly cycle of paying off only minimums on the credit card each month, leading to an accumulation of ever-larger balances at outrageous rates of interest. [OTOH, rewards offered by credit companies when the balance is always paid off in full is like gravy]. When the Torah calls interest the "bite of a snake"- a venomous snake - it was not exaggerating. Just as venom, slowly at first,but more rapidly as time goes on, affects the inner workings of the victim's body, borrowing on interest one cannot afford, attacks the inner workings of one's self, simchas hachaim and very soul [in addition to eroding one's financial foundation]. This issue needs to be discussed more and brought more into the open. Kudos to the Yated for publishing Rabbi Birnbaum's piece.

However, at the same time, in my opinion, Rabbi Birnbaum oversimplified the problem and how a person in such a position should deal with the issue. He basically said that a person should work on himself to not have kinah. He quotes Rebbetzin Zlata Ginsburg's (daughter of the famed Mirrer andPonevezher mashgiach, Rav Yechezkel Levenstein zt"l) as saying how in America, ostentatious weddings, large houses, fancy cars and expensive clothing have become the new standard, and if one could just train oneself to not pursue such a lifestyle, one would not fall into debt. I'm sorry, but I know numerous situations of people who resisted with all their might ostentatious weddings (try to make one for less than $15k or even $20-25k [Unfortunately even a "budget wedding" is out of range for many, see my post on the need for a new model]), who do not live in large houses, drive fancy cars or need to be adorned in the latest name-brand clothes, but they are still living beyond their means.

Let's talk turkey. I want to share a conversation I had with an executive director of a well-known yeshiva about a year ago. He said that household earning a combined $200,000 or more generally easily meet their tuition responsibilities. Households in the $100-150,000 range, on the other hand,were "making it," but not necessarily easily or were "making it but struggling." He added he was talking about a typical family with 3-4 kids in yeshiva. [Maybe I am only speaking for myself, but $200,000 in combined incomes-both parents working full time and contributing nearly equal amounts-seems like an incredible amount of money, even in 2007, and must come with an incredible non-monetary "price tag" in terms of missed time with the children, exhaustion, coordination, etc.].

What if they have 5-6, or 7-10 or more? And what if one or more of the kids needs extra tutoring or has special education needs? He didn't say, but let's stick with the 3-4 kid cheshbon. Let's say the combined family income is less than $100,000. What does this executive director say about them? They often have "real issues," including "marital" issues, he explained. (Nevertheless, at his yeshiva, even kollel families, he explained, are required to pay at least $3,000 per child. No exceptions.) [I posted on minimum tuitions previously. I believe this post had the most comments to date.]

My point is that most people in a frum community nowadays do not have to live ostentatiously to be beset by extremely problematic and compromising financial situations. These days, with tuitions and other basic necessities, it's hard to imagine how a family with a fair amount of children and without inherited wealth [It is important to try to live frugally even when you can spend more in order to and build a cushion. That cushion will help protect a family from spiraling debts in the future] can survive on anything less than the salary of a doctor, lawyer or successful, independent businessman. [Doctors aren't making what they used to and many who have been to professional school also have $100K of debt to pay back, sometimes multiplied by two if the wife also went to law, med, or dental school. Making the "big bucks" often comes with a big price tag and I know my doctor and lawyer friends don't care for the the assumption that they are rolling in dough, especially when they are just squeezing by].

And, furthermore, what if the yeshiva system really does its job and produces boys and girls filled with the highest idealism who want to continue in kollel life for several years? [Seems the Yeshiva system is quite successful in this area. Even more successful is the Bais Yaakov system]. In case you don't know, the going rate for a solid boy who wants to learn five or more years is approximately $1,000 per month. That's about $50,000 over five years. And that, of course, doesn't include the money paid for the chasunah or the chasunah of other children, their tuitions, daily expenses, etc. [Nor does it include the amount needed to train for a parnasah once a married man decides it is time to leave kollel. Personally, I can't imagine buying a chatan for my own daughter, but it is practically standard in certain Yeshivish communities].

What Rabbi Birnbaum seemed not to understand, or at the least did not address at all in his article, is that there are lots of yirei Shomayim families who truly do not live ostentatiously and yet are faced with bills that cause them to fall into horrific debt despite living a modest lifestyle. I would venture to say that this is true about the vast majority who go into debt [Even a "modest" lifestyle can be beyond ones means]. Yes, there are some who fall into debt because they pursue unnecessary luxuries. However, I think most are not ostentatious, and in fact are repulsed by it.

Yet, debt is a real issue. And generally, the larger the family and the longer one is in the game, so to speak, the more of an issue it becomes. The first thing we have to realize is that despite all the fantastic wealth we are surrounded by in the modern world, living modest frum lives today requires an enormous, enormous amount of money. [My motto: no need to make a frum life more expensive than it needs to be]. We cannot blame those who don't make that $200,000 or more. We cannot tell them that it is a simple matter of working on the middah of kinah and not living ostentatiously [Agreed]. Is there a solution to this problem? [Teaching our children how to run a frugal home--and running one ourself--is part of the solution, although it still doesn't touch the tuition issue. Just like debt spirals out of control, savings increase and become their own additional source of income. In tax terms it is known as "passive income."]. I don't know, but the beginning of any solution has to encompass the entire community, including those with means who are not in debt (whose responsibility Rabbi Birnbaum brushed off). Those with money need to reach a little deeper into their pockets or at the least reassess their tzedakah apportionment. Direct a greater portion of your tzedakah dollars toward yeshivos. Many people give away large portions of their tzedakah money to all sorts of worthy causes, but don't realize that there is arguably no greater tzedakah than your local yeshiva. Yeshivos can start a sponsor-a-family fund to help pay tuition for families who simply can't meet even minimal tuition requirements even after a scholarship has been calculated. [Probably best if these funds are run by a separate organization]. Such tzedakah arguably goes further than any other tzedakah dollar you give and is tax-deductible. [A note: Required, i.e. non-voluntary, donations to a scholarship fund are not deductible]. Furthermore, some of the yeshivos themselves, including their tuition committees, could develop greater sensitivity to situations of families in genuine financial distress [Yeshivot need to pay their bills to, making sensitivity difficult, albeit necessary. Perhaps an easier area to be sensitive in would be to stop nickle and diming parents/students for less than necessary trips, parties, etc. Here is an example: I once watched a girl tell a principal she didn't have the money for a skate party. The principal told her, no problem, I'll pay and you give me an IOU. The girl really was resistant to signing an IOU and was trying to wiggle out of the party. The principal said the event was required. I will never know what the real situation was, but IMO the principal should have let her out of the event or treated the girl herself. She was one of the oldest in a family of 8 or 9 kids and either she didn't have the cash or didn't want to spend her cash on a skate party. And, I'd say that was her right].
At the same time, those who are in financial havoc have to see if there is any way to produce more income or at least reduce expenses [Reducing expenses is sometimes easier than finding new income. I routinuely "save" half or more than half the price of retail for groceries through smart shopping. It requires a lot of work, but every dollar I save is approximately $1.40-1.50 pre-tax dollars earned.]. One of the best ways of doing the latter is by keeping a detailed log of every penny spent [Review your receipts too or, better yet, have a frugal friend review them]. Inexpensive computer software like Quicken and Microsoft Money are great tools to follow your dollars and find hidden places where you may be able to cut back. [Excel works great too . See my Budgeting Label, especially Tool 1, Tool 2, and Tool 3]. Most financial planners will tell you that the first step toward regaining financial well-being is eliminating high-interest debt. One possible way to do this is to refinance your home or take out a line of credit [Home Equity Lines of Credit interest rates are climbing up and they do put your home on the line. Sometimes it is a good idea, sometimes it could be disastrous. The most important thing to do is get your budget in line even when re-aligning debt]. This is "good debt" [Update: I would not ever call a HELOC "good debt," but tax-advantaged debt to a limit]. in that it has tax advantages and is sure to incur interest at a rate less than the sinful rates of credit cards. And, of course, take as much advantage of interest-free gemachim as possible. The bottom line is that responsible yirei Shomayim families falling into debt is a growing problem that is everyone's problem. Not just those in debt [Agreed!]. There is arguably no more common type of mussar in the writings of Neviim than that addressing the insensitivity of those who have power and wealth toward those who don't. How the powerful and wealthy in a community relate to those without such means is a barometer of the spiritual health of a community. If they relate positively, it is a zechus for the community. If, chas veshalom, they do not, it can be well, let's not go there. There is perhaps no greater lesson at this time of year than this message.

As a community, we can do it. Together, we can do it. But as individuals pursuing our own agendas, immersed in our own pursuits, we will all fail. We have to help each other, reach out to each other and work together. Otherwise, what are we on this Earth for? What is the "klal' in Klal Yisroel?

Y. A.

14 comments:

miriamp said...

Just a quick suggestion of another source for accounting software. This one is free, and pretty robust -- I use it to manage my homebusiness and my husband and I use it, along with a simple spreadsheet to oversee the household spending and budget -- Gnucash. As long as we both remember to input all our receipts, no one has to separately balance a checkbook or credit card or bank account statement without the information about the other partner's spending. See it at www.gnucash.org. A quote from their site: GnuCash is personal and small-business financial-accounting software, freely licensed under the GNU GPL and available for GNU/Linux, BSD, Solaris, Mac OS X and Microsoft Windows.

Designed to be easy to use, yet powerful and flexible, GnuCash allows you to track bank accounts, stocks, income and expenses. As quick and intuitive to use as a checkbook register, it is based on professional accounting principles to ensure balanced books and accurate reports.

AryehBaltimore said...

I highly recommend all readers of this blog to check out Dave Ramsey (www.daveramsey.com), buy his book Total Money Makeover, and live every word. He takes the parts of the Torah about not getting into debt seriously (the borrower is slave to the lender). First, Home Equity Lines and part of the reason for the problem. There is no such thing as good debt. It is not good to have a home equity line, and it is not good to have a mortgage. Why pay $10,000 to a bank for the right to not give $3000 to the government? To modify a Dave-ism, it's better to give $10,000 to a yeshivah and you get the same tax benefit. The other problem with the home equity line is that many frum people I know keep racking up credit card debt, and then think they are being smart by making it "good debt". Problem is twofold. First, your house is NOT going to keep doubling in value every year. Many of you now own more on your home than it is worth! Second, by transferring the debt to a lower APR, you take the pressure off and don't change your habits. Just pay off the credit cards and be done with it. Dave says personal finance is 80% behavior and 20% math. As frum people, we live in complete financial bubbles. Do you know the average income in this country is something like $40,000 a year, and that in most places, nobody pays more than $200,000 for a house. Not only are our houses more expensive, but our incomes don't scale. If you own a home that is more than 2.5 times your yearly income, you are paying too much. My wife and I discovered that it's not the little things (like clipping coupons and buying used clothes), but often the big things. Dave says if you pay more than 25% of your take-home pay on your home payment, you're spending more than you can afford and it's impossible to get buy. Before our total money makeover, we bought a typical frum house in a typical frum neighborhood. I was spending more than 50% of my take-home pay on my house! We clipped coupons, bought generic, took no vacations, bought no fancy cars, and we still were losing money. So you may need to move to make a change in your finances.

Incidentally, I must respectfully disagree with Sephardi Lady. Credit cards cost more than their perks, even when you pay them off. First, all it takes it for 1 mistake to wipe out those perks. I missed 1 payment by a day due to a computer issue, and had late fees and 2 months of finance charges. Second, even if you make no mistakes, you do buy more when you use a credit card. It's just a fact. I 've seen it myself. I'll buy fewer "extras" at the grocery, fewer "things" at Target or Home Depot, when I'm paying with cash. Even paying with a debit card makes you feel it more as it disappears from your bank account instantly. But that credit card lets you spend far more than you intend.

Seriously, if you are reading this post, try listening ot some of Dave Ramsey archived on his site right now, and get The Total Money Makeover in bookstores.

Ahavah B. said...

I have to strongly disagree that a home equity loan or refinance is a good idea. Unless you have almost perfect credit to begin with, you are not going to get a fixed rate loan - and variable rate loans are financial suicide. And the qualifications for refinancing and home equity loans have tightened up so much in the last year that anyone in financial trouble with credit cards or consumer debt is simply not going to qualify anyway for any type of loan you would actually want - again, high interest variable rate loans are NOT an improvement over credit card debt - they're the same thing in disguise.

[An important aside: Also, the home equity departments of many large, national banks have actually shut down - and they are no longer offering no money down loans or "sub-prime" loans of any kind. When these divisions get in trouble, they "neglect" to pass along your escrow payments for your insurance and taxes - leaving you in a position of having to pay twice or lose your home. (There have been several examples of this in the national news lately.) And the tax office, etc., will not care that you "already paid." If they don't receive it, you haven't "paid" it. And the mortgage companies that collected your escrow will be tied up in bankruptcy and liquidation for months - presuming you EVER get your money back. You can check out the list of now defunct divisions of these banks at:

http://ml-implode.com/

As of today 176 home equity and mortgage refinance divisions of banks have completely stopped offering new loans.]

This is widespread all over the country and it is very foolish now to think that you can just refinance your way out of debt. That solution is no longer going to "work" - not that it ever did. People are actually going to have to earn real cash and really pay the debt - not just keep endlessly rolling it over into newer and newer loans. "Refinancing" debt is NOT paying it off - it's just acquiring a new slave-master in place of the old one. It's time to stop this game and actually GET OUT of debt by actually PAYING IT BACK with real cash and not just more debt.

That means working or cutting expenses or both - that may mean adopting extreme austerity measures for a while if you are deeply in non-mortgage debt.

AryehBaltimore said...

Agree with Ahavah 100%. As Dave says, "You can't borrow your way out of debt." Home Equity Lines aren't abbreviated HEL for nothing...

Mike S. said...

I agree you can't borrow your way out of debt. I disagree with her about adjustable rate mortgages. They can be very useful, provided you know what you are doing; short term money is usually cheaper than 30 year fixed money. For an ARM to pay, however, you must be able to handle a bump up in rates. Also, you don't want to take an ARM when fixed rates are sitting near all time lows unless you know that you will be selling before it adjusst (not because you are speculating, but because, say, you are in the military and know you will be transferred in 2 or 3 years.) (i.e. this is not the time for ARMs)

I had ARMs from the mid 1980's through 2000 when I was able to get a 15 year fixed at 5.375%. I saved a ton. The ARM was at least 2 percent below the fixed I could have had when I bouight for the whole time, and 5% less for most of the period.

SephardiLady said...

Thank you everyone for your comments so far.

To clarity and discuss:
--A person should always change their spending habits before trying to "borrow their way out of debt." A HELOC is normally something I would advise against (like I wrote it can be disasterous), but there are situations where it is a better alternative. Each situation must be weighed carefully and one should not risk their home to the bank. E.g., I had a client who took a HELOC out to pay for a hospitalization. His home had been paid off for over 20 years. But he just didn't have the cash flow. For him, a HELOC (fixed rate) made sense.
--I agree with Aryeh that paying with cash is best (esp. for those having financial issues). But carrying cash comes with its own risks and inconviences too, and for those who are disciplined I can't recommend against using a credit card so long as the money is there to pay it off and you ensure it is paid on time. For those who use plastic, I recommend against opting out of a mailed statement. I also recommend scheduling an early payment as soon as the statement closes and making sure payment is made (mark your calendar).
--We have benefitted greatly from smart use of credit cards. One card has deposited over $1000 in a 529 account and that account is increased in value over 18%.

AryehBaltimore said...

SephardiLady,
I respect your opinion, but I think each of those issues is covered by having a sound financial plan.
Point 1 - If the client had his home paid off for 20 years, why didn't he have an emergency fund to cover what his insurance did not cover? Dave recommends 3-6 months living expenses. And if he was not insured, why not? With proper money management, everyone can afford health insurance even without a group plan.
Point 2 - It's been studied by the credit cards--you spend more when you use plastic. I was the guy who paid it off each month, and it doesn't matter about "discipline", you just spend more. McDonalds found people spend 37% when they used plastic. You just don't opt for as many extras when you reach for the green. That $1 extra candy bar at checkout, that $4 bag of kosher jelly candy--it seems really high when you have a fixed envelope of cash that you whittle down. I have saved enough using cash that even if H"V it were stolen (about the only risk), I would still be ahead.
Point 3 - I bet if you weren't using plastic, you would have likely spent less money overall and could have saved that money yourself. The increase in value would be had with any 529.

As Dave puts it, he's never met a rich guy who got that way with Airline miles. Not using credit cards effects an entire change in thinking and handling money, which is worth in real dollars many times the 1-2% reward I may receive.

I'm not immune to the draw of rewards. I have 1 card I use for my work expense account (I'm in sales). It's great to get $25 Amazon.com gift certficates all the time, but I get the rewards because I spend $15k per year for my job, far more than would normally be put on plastic. I would never do this with my personal money (not to mention nobody pays me back when I overspend personally).

SephardiLady said...

Aryeh--Your points are all great. Unfortunately, being in debt esp or not having enough in savings puts one into a bediavad situation.

Maybe I should open the forum up for a debate on credits cards soon. I've seen the studies and can't deny the stats on the ground. But we have exercised a lot of discipline as our budget for household items and groceries continues to fall (sometimes in dollars, and definitely per capita) even though I'm using credit cards and not writing checks now. I really don't like carrying cash. I started using a credit card when I showed up to rent a car with a debit card and was turned down. After that I started traveling for work and took a rewards card to benefit for what I ultimately wasn't paying for. Since then, I've been using a credit card and paying it off in full every month and continue to tighten my belt. I think it can be done, although many people (maybe me too) are better off carrying cash. I feel like I'd need a bodyguard to carry cash sometimes.

Somewhat Anonymous said...

Aryeh -

Reward cards (I use Amex Blue Cash) can also be very useful for repeating non-store charges (such as phone bills, tuition, etc.) which are often pretty large and how you pay for them won't affect what you spend anyhow.

I agree with SephardiLady about the inconvenience of carrying cash. I also find that contra Dave Ramsey, cash on hand tends to be spent more freely and gets missed when trying to track my monthly expenses, whereas all credit card expenses are neatly recorded without the necessity of having to remember to mark down each purchase. If my family used cash for most purchases I would have a much fuzzier view of my monthly expenses.

I find Dave Ramsey's approach to be geared to keeping people out of trouble, and I generally approve, but he does overstate the evils of debt somewhat. If you are careful and understand the basics of amortization, interest rates and the like, debt can be a useful tool.

Out of curiosity, what is Dave's general position on student loan debt?

AryehBaltimore said...

Well, there are 2 issues with regards to student loan debt--one is the student about to go to school, the other is the b'dieved "I already have too much debt."

First, he says there is no reason to go through undergrad with any debt. He even says there are ways to handle grad school as well that way. A few facts:
1) Big name schools don't matter much for undergrad, state schools are fine. I personally have friends who went to Harvard, Yale, BU, and UMD. The friends that went to UMD are just as successful if not more so. After your first job, nobody even looks at what school you went to.
2) You go to school to get a degree in a vocation, not to "find yourself". There are cheaper ways to do that. It's ridiculous to take 5 years to graduate (most can do it in 3) because "I can't figure out a major".
3) While in school, you should have a job. Trust me--I went to a big Ivy League University. I had a tough major, and I had time for a job---I didn't have one, of course, as that would "detract from my studies". Instead, I watched TV, hung out with friends, etc, things which likely detracted more from me than having responsibility.
4) Dave says most people he counsels did not incur their student loan debt on tuition and used books, they incurred it on off-campus apartments (on-campus is cheaper), eating out (dining halls are cheaper), and all the extras you buy when you are living on "free money" (student loans). It's like economic outpatient care, except your future self is the doctor.

By going to an affordable university (state school), having a job, being directional, and living frugally, you can graduate with no debt.

If you already have student loan debt, Dave tells you to pay it off quickly. He gets folks calling with $100k in student loans. When they tell him they are doctors making $200k per year, he acts shocked. Average income in this county is $40k. So if you lived like the rest of the country for a year (or like yourself during residency), the student loan would be gone in a year and you'd have a huge income with no debt. Problem is people think, "Why should I be renting an apartment and driving an old car when I'm a doctor?" As Dave says, "Live like no one else, so later you can live like one else."

Do I sound like a religious zealot? I think the frum world needs a major dose of Dave....

aryehbaltimore said...

Somewhat anonymous--
Oddly enough, I used to feel the same way as you with regards to tracking expenses. Cash seemed "free" because it wouldn't show up as a transaction in Quicken. But guess what? I could track all my spending, and at the end of the month, it was still too much. Yes, I could track it easier, but the numbers I tracked were still too high. Now, I spend the money on paper and take out my grocery budget in cash. You cannot overspend if its cash in hand labeled "grocery money".

miriamp said...

You cannot overspend if its cash in hand labeled "grocery money"

As far as that goes, it's true... but then you have to know in advance which person is going to do the grocery shopping, the clothes and shoe shopping, etc., so the right person has the money envelopes.

Actually, in my household, only one person does do the grocery shopping, and it isn't me! I'd have to go with lots of kids in tow, go in the early morning when truthfully I'm not really awake, wait until late at night when my husband is home, or pay for a babysitter. My husband knows exactly which stores have the best prices, shops on the way to or home from work, and stays within budget much much better than I would. He doesn't do impulse buys (I would) and he's in and out of the store in far less time than it takes me.

I might do the clothes and shoes, but he also might do them. What it really comes down to for us is that if there's cash in my pocket, or even a balance in my paypal account, I'll spend it. We have an account for pocket money in Gnucash, what we use instead of Quicken, but you think I remember to enter things! Sometimes. But if I'm out with the kids and I have cash, I am so much more likely to stop for a drink and snack than if I would have to use a credit card. Usually, we can wait until we get home, and the drinks and snacks at home are cheaper and in-budget. So I try not to carry very much cash at all.

Also, I'm sure many if not most of Dave Ramsey's ideas have a lot of merit, but I really don't see how to put them into action with children in yeshiva. And I am not planning to homeschool! (Or worse, public school. And yes, I went to public school. I am not sacrificing my children on that alter.) But how can you have 3-4 months of living expenses tucked away in savings unless you can afford that on top of full tuition. How can you ask for a scholarship if you have the money? That's dishonest. And if you tell them about the money, won't they think it's available? And then you won't have it.

aryehbaltimore said...

MiriamP-regarding your last comment, my wife and I always joke about what Dave would think about the frum world. Building up an emergency fund of 3-6 months is just part of a sound financial plan, just as saving for retirement and saving for college is.

Regarding who gets scholarships, why should an emergency fund be any different than owning a house, or a car (or two or three cars?). Why should a yeshiva penalize a person financially for keeping their funds liquid instead of tying them up in a house they can't afford? Or what about the car they don't need that they bought with money they don't have to impress people they don't like?

Are you requesting a scholarship while putting money into a 401k? Are you feeding your kids rice and beans every night, with 1 cube of meat in your chulent on shabbos to be yotzei? Do all your kids share a room? My point is that you have a financial life apart from yeshiva, and unless you literally live in a shack eating rice and beans, you've withheld SOME money from the yeshiva. So why not withhold enough to build an emergency fund? Yeshiva should not eat up savings--it should be part of your budget. If it is not, you need to have fewer kids, or move to an area with cheaper yeshivas.

I definitely think something is rotten with how the yeshiva system charges people (these pages attest to that). Why should my kollel neighbors eat meat every night, drive expensive cars, and take trips to Israel 2-3 times a year, AND get a break on tuition? Meanwhile, I'd be charged full price and get no break while I scrimp and save. Point is--counting emergency funds as part of what you "can" pay is just ridiculous. If the yeshiva expects me to pay more than I can budget, I will find an alternative (I also don't intend to have more children than I can afford).

miriamp said...

Exactly which of my children should I give back, Ch"v'Sh?!?

Sorry, that was a hot button. But you don't say to a mother of 8 that she should have had fewer children. Too late. And where do I find cheaper yeshivas commuting distance to my husband's job? Or is he expected to switch jobs/careers as well? And who's to say he could find a comparable one in such a location? And why should I uproot my children from a really good and supportive community and a day school that is a really good match for all of them to save a little money? Their education is too important for that.

And no, we don't have a 401K, because to us that too that felt like stealing. My husband just isn't planning on retiring ever. We're not saving for college either, and our cars are for transportation and convenience (I admit that -- it would be cheaper but harder and way more time-consuming to not own any), not for show.

My kids wouldn't eat rice and beans, or I might be tempted to try feeding them it. And the cholent is all meat, no potatoes or beans, and only sometimes rice, because 1.) It's Shabbos, and 2.) What a waste of food to cook things they won't eat.

7 kids share two bedrooms. The 8th (an infant) is still in my room. There aren't any shacks reasonable distance to school and shul, so we didn't buy one, but we did get stuck with a money pit. We wouldn't do any better by getting out and buying a different one, so we're dealing with this one. But we're already on the very edge of the frum community, and just past the eruv, in order to be able to afford it.

I actually don't know how the formula for how much tuition a given family owes works, and there is a formula here. Maybe an emergency savings account wouldn't count against us. Maybe it would. We just fill out the forms, and they tell us what we owe, and then we prioritize it and try to make things work on what's left. And I'm sure there are tons of areas where we could economize and aren't. We're still learning too. But I'm not seeing a place to cut enough to sock away emergency savings. If we could do that, we'd pay off the credit card debt instead, since I think it's about the same. Which I would love to do, but I don't see it happening while also paying Yeshiva tuition and feeding and clothing the kids. I'm already sewing what I can, but I don't make shoes, boots, tights or winter coats.

And now we have to paint the living room, because the original paint (almost definitely lead - the report wasn't specific enough for my taste) is flaking and the crawling baby likes to lick the baseboards. That's a safety issue, so it will be done. Just not liking the color wasn't enough, so it hadn't been done yet. But we'll do it ourselves, not pay someone else to. And the leaking old heating system pipes, the ones we haven't replaced yet, will just be clamped again, because we don't have the thousands of dollars to replace them. Eventually we'll have to anyway, and if the money doesn't materialize for that then the credit card debt will just go up.

I'm actually not complaining, just stating facts. I guess I don't have a sound financial plan. Just a firm trust in Hashem to see us through, one way or the other. Children are a blessing, not a financial burden. Usually we find the money for what we need, and sometimes for what we want too. It all works out in the end. (Please don't take that as a blase attitude about debt. It's not. I don't like having debt, and I don't expect to win a lottery I haven't entered or reap an unexpected windfall, but I do believe Hashem will take care of us if we trust him enough, albeit through our working hard, and budgeting hard, and not counting our children against Him as an extra burden.)