Beating Broke

Personal Finance from the Broke Perspective

Taking Financial Ownership

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I was reading a story somewhere where a person was being interviewed about their debt.  In the interview, the person was speaking about how they had this credit card debt and how they just couldn’t get out from under it because of all the interest, fees, and other ways that the credit card company throws on the heap each month.  They went on to talk about how they were in fear of having their car and house repossessed because they were falling behind.  With each new problem, they were quick to point out the things that were keeping them back and causing their slide into bankruptcy.

Something occurred to me, then.  They were taking no ownership in their finances.  No matter what the financial woe was, it was always someone elses fault.  The credit card companies were tacking on interest and fees.  The bank was adding late charges onto their car loan and mortgages.  Not once did they take any ownership of their situation.  Not once did they say, “we shouldn’t have charged so much on the credit cards”, or “we bought more house than we could afford”. The blame was always on the other guy.

Saving is for wimps! I have a plan for affordable housing.If there’s one thing I’ve learned in my journey towards beating broke, it’s that it’s all my fault.  I signed that credit slip.  I signed that mortgage.  I signed the loan papers.  Yes, some of the credit card companies have interest rates and policies that border on predatory.  Yes, the banks will allow you to borrow right up to a point where you’re living paycheck to paycheck.  But, I signed on the dotted line.  Along the way, I discovered all of that, and I took financial ownership.  And, in doing so, I took control.

Through financial ownership, I have control over where my money goes.  I have control over which debt gets paid off first.  I have control of how tightly the purse-strings are held.  And, most importantly, I have control of my financial future.  A future that I plan to make as financially independent as possible.  Not at the whim and mercy of any bank, but a future where I can plan to buy things, and save money towards retirement.

My journey isn’t over, but I am beating broke.  I’m taking financial ownership and making my future one that is free from broke.

I want you be able to say the same thing.  It’s one of my goals for this site to help you beat broke.  Beating broke is the first step in your financial journey towards a life free from concerns over where next months bills are coming from.  You can do it.  But, you’ve got to take financial ownership.  You got yourself in the situation you’re in, and only you can get yourself out.  Do it today.  Accept that you are the only one that can take ownership of your financial situation, and you are the only one with the power to fix it.  Take that step.

photo credit: woodleywonderworks

Car Trouble Part 2

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Unfortunately, losing an engine in the one car wasn’t the end of our car trouble.  It was, by far, the worst of our car trouble, but, certainly not the end.

Because the engine in the other car was gone, we are down to just the one car.  We’re carpooling.  For people with office jobs, carpooling isn’t such a big deal.  For us, it’s a bit of a problem.  In order to do her job at her business, my wife needs a car to transport her clients as well as to meet her clients at their job sites or for job interviews.  Not having a car is not an option for her.  Because the company is still very young, they don’t have the financial ability to have a company car.  Which means that they have to use their personal cars.

So, everyday, we have to coordinate my getting to work, the kids getting to daycare, and then the reverse of that at the end of the day.  Still not a huge deal, right?  Until you consider that my wife’s job isn’t just a 8-5 sort of job.  As the owner of the business, there are meetings and things that she has to attend out of town, and after hours.  Just in the first week that we were doing this, she’s had to be late to meetings so that she could leave long enough to pick up the kids, then me, and then drop us off at the curb in front of our house.  An inconvenience at the least.  Luckily, everyone has been pretty understanding so far.  But, the longer we are without that second car, the more chance there is that she’ll have to be late to or miss a meeting with someone who won’t be so understanding.  And if that happens, it means lost work for her and the company, which means lost revenue.

But, I’ve gotten off on a bit of tangent.

Because we have an increasing need to use the second car, we needed to put new tires on it.  We’ve known that it would need the tires, but because it was the car that I was driving to work and back, it wasn’t a priority.  I drive less than a mile total each day, so dealing with bad tires wasn’t a big deal.  Now, with my wife driving the car every day and putting more mile on it in a day than I normally did in a month, the tires became a big deal.  Especially in the dead of winter.  So, new tires it was. A planned expense, but a rushed one that came before we were truly prepared to do it.

IMG_1147To finish it all off, the day after we put the new tires on the car, my wife came home to pick up a couple of things for a meeting she had later in the day.  The neighbor across the street had a friend come and pick her up for an appointment, and, while backing out of the neighbors driveway, backed right into the side of the car.  The better part of the drivers side door is now concave, and the drivers side mirror is shattered.  Luckily, the other driver has insurance, so we’re hoping that it will pick up the damages.  But, because the other car is in the shop until further notice, we’ll have to wait until it gets out to send the other one in for repairs.  And we’ll be carpooling still.  Just in the other car.

And that, my friends, is our January in cars.  Here’s hoping for a less turbulent February.  I’d say a less turbulent 2011, but I don’t want to jinx it…

photo credit: majcher

Car Trouble Part 1

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Sometimes, when it rains it pours.  And January really was one of those months for our cars.  In mid January, one of our cars wouldn’t start in the morning.  Now, we live in North Dakota.  A car not starting in the morning isn’t unheard of, and borders on common.  Especially when the overnight low nears the -20 degree range.  So, I wasn’t too worried about it, and figured it just needed a little warming up to get going again.  Since we were expecting to get into the 20s that weekend, I just left it and tried it again when the temperatures warmed up.

As you can probably guess from the title, that didn’t work.  So, my thoughts immediately go to the gas line.  If the gas level gets low enough, the condensation in the tank can get into the gas and then freeze the line up so that the gas supply is either so low that the engine won’t run, or can stop the gas flow altogether.  I ran to the gas station, grabbed a bottle of heet and dumped that in.  When that didn’t work, I even went so far as to run an extension cord out to the car and use my wifes blow dryer to try and warm up the lines.  Still, it would not start.

With anything like this, there is a point where you have to admit that you just don’t have the skills or the tools to do the job.  If the line was frozen, it needed to be warmed, and I had exhausted my capabilities to do that.  If we had a garage, I could have pushed it into the garage and let it warm up there, but we don’t have a garage.  So, I had to have it towed to a mechanic.  I don’t like doing that, but I have roadside assistance insurance so the tow is covered, and we do need the car to run.

Car TroubleUnfortunately, when the mechanic started running diagnostics on the car, they discovered a far worse reason that it wouldn’t start.  They couldn’t get the engine to produce any compression.  No compression, in an engine, means that the pistons are not moving.  And if the pistons are not moving, that means there is something wrong with the engine.  In the case of this car, the most likely culprit is that the timing chain broke.  To add to the problem, the engine is what’s called an “interference engine”.  Which means that it uses the interference created by the movement of the engine to help keep the engine moving.  When an “interference engine” loses control by losing it’s timing chain, it basically runs amok.  The pistons and lifters run however they please and start banging into the rest of the engine until parts start bending and breaking.

I know this because it’s already happened to this car once.  Apparently, this particular model and year of car is pretty famous for it on the internet.  The engine gets to about 69,000 miles and loses it’s timing chain, and, as a result, it’s engine.  You’d think there would have been a recall at some point, but I guess it wasn’t a big enough problem.  The first engine in the car blew at about 58,000 miles.  We put in a used engine that already had 28,000 miles on it.  The car is now at about 97,000 miles.  If you do the math, that makes the second engine at about 67,000 miles.  Right on schedule, I guess.

Depending on the severity of the damage, we either need a few new parts, or a whole new engine.  And, until they tear the engine apart, they won’t know the damage.  And, as luck would have it, the mechanic that I had tow the car doesn’t do engine work of that level.  If it needs a battery, oil change, jump start, etc, they do it, but to get in and start replacing parts is more than they have the manpower or space for.

After making a few calls, I found a mechanic that specializes in engine work.  Our options are to put a new to us used engine in the car, rebuild the engine (replace most of the old parts with new parts), or to put a whole new engine in the car.  The mechanic was only able to find one used engine, but it has well over 100k miles on it already.  But, it would only cost about $1700 to put it in.  To rebuild the engine would cost about $3400.  And a whole new engine would be about $4700.  Did I mention that the cars value is only about $4500?

My wife and I have discussed it, and we’re a bit hesitant to put in a used engine into the car.  We had the “should I sell my car or fix it” conversation as well, but it’ll be cheaper to just fix it.  We’ve done the used engine bit once with the car already, and look where that got us.  We’ve decided to have the engine rebuilt.  It’ll cost twice as much, but we’re hoping that it will last quite a bit longer than the used engine might.  We’re also hoping that we’ll be able to then keep the car that much longer.  Also, the rebuilt engine would have an aftermarket timing chain to replace the one that broke, so shouldn’t have the same problem as the factory chain had.

The one bright spot is that we own our cars.  We’re not making any payments on either, so we aren’t going to be hit with the double whammy of paying for a new engine on a car that we’re still paying payments on like we did the last time this happened.  We may have to take a loan out on the car to pay for the engine, but it should still only be one payment.  Hopefully.

The whole thing is going to be a major setback to our payoff plan.  We had planned on using our tax refund to make a big dent in our debt snowball, but it now looks like it’s going to be put towards paying for the new (rebuilt) engine.  I don’t like it, but the situation could be much worse.  When the first engine blew, it was before we had started with any sort of financial plan.  In fact, it was one of the larger contributing factors to our getting control of our finances.  Now, it’s more of a setback and inconvenience than anything.  It sucks, but we’ll get over it.

Unfortunately, that’s not the end of our January car troubles.  Stay tuned for part 2 coming soon!

P.S. if you’re wondering, the car is a 2002 Oldsmobile Alero.

photo credit: fauxto_digit