Personal Finance: Ask the Experts

Get advice on money matters from The Bee's Claudia Buck and a panel of local experts

October 1, 2012
Surviving the recession: How do we get back on financial track?

Q: I'm wondering if you have any recommended resources for families who are trying to put their financial lives back together after the recession. We didn't lose our house, we didn't completely lose our jobs, we still have health care, cars, children in sports, etc.
However, we did this by hanging on for dear life, and obviously we made mistakes. We thought if we worked hard and cut back on "wants" vs. "needs" we would get through this and then catch up. But now the cars are old and falling apart, the house is a fixer-upper that can't get fixed up and is worth half of what we paid for it. Our credit score is still OK, but the balances on our cards are so high that we don't know how to pay them down.

One of us is employed full-time but there have been little or no raises or COLA in 5 years. One of us is part-time, but has taken repeated reductions in work, and will probably be down to just a few hours a week when the tax hikes don't pass. Full-time jobs are not available right now, or don't pay enough to cover childcare. Food is more expensive, medical costs are through the roof, and student loans just break even because we only pay $500 per month on them.

We never thought it would last this long. We won't be able to "get by" for much longer. I know there must be ways to get advice, but I can't find it.
Any ideas?
I WAS in the Middle Class, Sacramento

A: I realize that times are tough, but if you take a breath and focus on the positive aspects of your life (e.g., both of you are working, although not at the rate you would prefer, you have a home, your credit score is ok, etc.), you can tackle the issues that need to be addressed.

First, let's talk about spending and debt. It's great that you have gone through the "wants" vs. "needs" exercise, but it might be beneficial for you to seek the help of a nonprofit credit counseling agency, that has been approved by the U.S. Trustee's office. The agency will negotiate with your creditors to try to lower your interest rates and perhaps get some fees waived. They also provide useful money-management advice.

To select a credit counseling agency, go to the Department of Justice website www.usdoj.gov. Once there, select "A-Z Index" at the bottom of the page, then "Credit Counseling and Debtor Education", and then "Approved Credit Counseling Agencies". The service is not free, but the costs are nominal.

If it's unlikely that your employment situation will improve, you should explore training for a new career. Information on resources associated with The Trade Adjustment Assistance Community College and Career Training Grant Program (TAACCT) can be found at www.doleta.gov/taaccct/

To obtain an overall review of your financial situation, you can take advantage of a free, one-on-one session with a financial planning professional, as well as classroom-style workshops, at the second annual Financial Planning Day event, on Saturday, Oct. 13, in West Sacramento.

The event runs from 9 a.m. to 3 p.m., and will be held at the West Sacramento City Hall. You can find out more and register for this event at www.financialplanningdays.org.

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Meet Our Financial Experts

Claudia Buck

Claudia Buck is The Sacramento Bee's personal finance columnist. Read all her columns here. Contact her at cbuck@sacbee.com

Terri Carpenter

Terri Carpenter offers advice on job hunting, retraining and career counseling. Carpenter works at Sacramento Works Inc., the career and job training arm of the Sacramento Employment and Training Agency (SETA). With 15 years in the field, she has hands-on experience with everyone from first-time job seekers to career professionals seeking advice after a layoff or looking for a mid-career change. Ask her a question.

Carlena Tapella

Carlena Tapella is a partner in the law firm of Webb & Tapella Law Corp. in Sacramento. The firm specializes in estate planning and probate, such as estates, trusts, conservatorships and litigation. She is a past president of the Sacramento County Bar Association's Estate Planning & Probate Section. Ask her a question.

Kimberly Foss

Kimberly Foss, certified financial planner, is the founder of Empyrion Wealth Management in Roseville. With nearly 30 years in the financial industry, her clients include women in transition, small business owners, retirees and "pre-retirees." Ask her a question.

Jesse Weller

Gregory Burke, a CPA and tax expert with John Waddell & Co. in Sacramento since 1984, worked as an IRS tax auditor for six years. He’s a past chairman of the California Society of CPAs. Ask him a question.

Daniel Tahara

Daniel Tahara takes your questions about California taxes. Tahara, a spokesman for the state Franchise Tax Board, has 10 years of experience as a tax auditor. Ask him a question.



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