Forseeable Money Problems- What to do?

[SunshineMama]

Hi Ladies! I could use some of your opinions on this one!

I am due with our third child the end of December. I currently watch 3 other children, and my own 2. I am looking for a replacement for the child I just termed, and have a part time family that wants to sign up with me, but I would need another part time family to make up for the rest of the income. Honestly though, I really do not want to take another child right now, but I feel like I have to for financial reasons.

My family with sibs is gone from November - March. (This is my problem) They make up 1/2 of my income. The other child I watch is a doll, but his mom is flaky with payment. I always have to chase it down from her, but I always get it sometime during the week, it's just a pain.

DH's job is transitioning his role. He got a promotion, but most of his income is based on commission, and he has to build a pipeline. To help him out, his company will average his commissions for the past 3 months, and that will be his income for the next 6. The problem, is that during the last 3 months we went on vacay for 10 days, and they happen to be the worst 3 months commission wise in his history with the company. I did a budget this morning, and, even if I defer all student loans, cut all extras, and cut our food budget rediculously low in half, we are still $1,500 in the hole for November - March.

In March, I will have to cut one child from my care (the part timer, most likely), because I will be over my ratio when my sibs come back. I feel bad knowing I will have to take a child on now knowing I will have to cut them, but I have to do what is necessary for my family. I also have to have something as a back up incase the sibs decide for any reason not to come back, which is a possibility since their mom wanted me to take them to and from preschool and take a paycut the same amount as their preschool. (I have never raised rates on them but with them gone 4 months out of the year and a pre-agreement not to charge them theres no way I am cutting their rate. I can't). I LOVE my current group, and if the sibs were not gone for those winter months I would be okay.

So I know I am going to be in financial trouble in the next 6 months,and I want to do whatever I can to make it by, but I am not sure what I should do now. DH's company just told him he needs all new suits ($1,000 extra expense), and something always comes up and I can't seem to save much. I dont know how we are going to do it. If DH make more commissions and does better than expected, we may be okay, but that is no guarantee that will happen and I cant hedge my bets on that.

Sorry so long. What would you do in my position?

[SilverSabre25]

Sounds similar to our situation, only you get to plan for yours! Is that $1500/month in the hole or $1500 total?

Start to build a cushion now. Cut out all/most of the extras NOW and put the money into a savings account to help cover things then. Plan now for a frugal holiday season--start shopping Once Upon A Child for Christmas toys, for example. And any new baby gear you might be needing.

If you have an extra freezer, stock up on foods you use a lot when you they are on sale. Stock up this summer/fall on the produce and fruits that you can freeze and use later. Plan a set of super frugal-but-nutritious meals you can always have the ingredients on hand for. Think about getting a Costco/Sam's membership if you don't have one already. I prefer Costco myself for their availability of organic things at the same price as conventional at the grocery store.

Can either you or DH get a part-time job? I don't know your DH's hours, but he could look into something like working at UPS or FedEx part-time as a package handler. It's okay money and they have shifts at odd times--my DH is working at FedEx in the evenings, starting at 6:30 and going fro 2/3/4 hours. It's not always the same each day, but it's 10-15 hours a week which translates to $100+/week extra for us. That's enough to make it worth it for us.

[cheerfuldom]

I like the suggestions of the PP.

But also keep in mind that you are already doing what you can daycare-wise. you have a new baby joining the family and you need to concentrate on controlling your stress level and your physical health. That always comes first!

I would go through the house and sell anything extra, do what I can to live in the budget, and then let the chips fall where they may. If that means putting some on a credit card for a few months, so be it.

[SunshineMama]

Sounds similar to our situation, only you get to plan for yours! Is that $1500/month in the hole or $1500 total?

Start to build a cushion now. Cut out all/most of the extras NOW and put the money into a savings account to help cover things then. Plan now for a frugal holiday season--start shopping Once Upon A Child for Christmas toys, for example. And any new baby gear you might be needing.

If you have an extra freezer, stock up on foods you use a lot when you they are on sale. Stock up this summer/fall on the produce and fruits that you can freeze and use later. Plan a set of super frugal-but-nutritious meals you can always have the ingredients on hand for. Think about getting a Costco/Sam's membership if you don't have one already. I prefer Costco myself for their availability of organic things at the same price as conventional at the grocery store.

Can either you or DH get a part-time job? I don't know your DH's hours, but he could look into something like working at UPS or FedEx part-time as a package handler. It's okay money and they have shifts at odd times--my DH is working at FedEx in the evenings, starting at 6:30 and going fro 2/3/4 hours. It's not always the same each day, but it's 10-15 hours a week which translates to $100+/week extra for us. That's enough to make it worth it for us.

That would be $1,500 in the hole :( I like your suggestions. I do have a deep freezer- I wonder how long veggies, etc can keep? I do have a Costco membership. I think I should start buying diapers for the new baby now probably. Evening hours are too crazy to get a part time job, so my only option would have weekend childcare. I really, really do not want to do that. Sigh. Maybe thats what I have to do though. I dont want to take any 401k loans out if possible. This stinks.

[countrymom]

I would slowly start buying diapers now (did you know if you have a new box and need the next size up many stores will let you upgrade to the next size) and wipes. also, start to live on a budget. You know how much you need so start to put money away.

[Kiki]

That I wonder how long veggies, etc can keep? .

http://www.fsis.usda.gov/FactSheets/Focus_On_Freezing/index.asp#19

If you scroll down, there is a chart that tells you how long things last for.

I feel your pain-every summer my husbands hours get cut by about 25% so we lose a good chunk of our money. My advice is almost exactly the same as Silver, cut out anything you possibly can now. If you have cable and all of those extra things, call your provider, and see if they are running any deals; or cancel them all together. (Whatever is best for you!)
Do you have equal pay set up on your utility bills? I found that helped me a lot this year, not having the surprise of a $250.00 summer electric bill, and so forth. (That's high for Utah.)
And again-freeze, freeze, freeze!

[SilverSabre25]

That would be $1,500 in the hole :( I like your suggestions. I do have a deep freezer- I wonder how long veggies, etc can keep? I do have a Costco membership. I think I should start buying diapers for the new baby now probably. Evening hours are too crazy to get a part time job, so my only option would have weekend childcare. I really, really do not want to do that. Sigh. Maybe thats what I have to do though. I dont want to take any 401k loans out if possible. This stinks.

Properly stored, I think veggies can comfortably last 6 months to a year in the freezer. Buy pot roasts at Kroger when they're buy 1/get 1 free. You can easily make a pot roast into at least 2 meals, if not three. Same with whole chickens, turkey, etc. At Thanksgiving, budget to buy a couple extra turkeys, and at Christmas budget for a couple extra hams.

Seriously--consider cloth diapering your new baby. Really. It saves a ton even though there's a bit of an initial outlay. Heck, I have enough cloth diapers for about three babies. I could probably sell you some of mine! I do NOT need this many cloth diapers :P

Consider looking for just one weekend child or something. There's not a HUGE demand around here but I do see it from time to time. Or offer evening/date night type sitting.

[MyAngels]

Have you thought about doing something part-time, but from home? I used to do transcription and database design and management from home.

Here's a couple of threads from awhile back: http://daycare.com/forum/tags.php?tag=extra+work

[Kiki]

Properly stored, I think veggies can comfortably last 6 months to a year in the freezer. Buy pot roasts at Kroger when they're buy 1/get 1 free. You can easily make a pot roast into at least 2 meals, if not three. Same with whole chickens, turkey, etc. At Thanksgiving, budget to buy a couple extra turkeys, and at Christmas budget for a couple extra hams.

Seriously--consider cloth diapering your new baby. Really. It saves a ton even though there's a bit of an initial outlay. Heck, I have enough cloth diapers for about three babies. I could probably sell you some of mine! I do NOT need this many cloth diapers :P

Forgot about cloth diapers! My sister said her start up was around $150.00 for my niece, totally worth it.

Don't forgot to use those chicken bones/turkey bones for stock, and then turn some of the leftover chicken/turkey into noodle soup. You can freeze that as well!

[cheerfuldom]

Forgot about cloth diapers! My sister said her start up was around $150.00 for my niece, totally worth it.

Don't forgot to use those chicken bones/turkey bones for stock, and then turn some of the leftover chicken/turkey into noodle soup. You can freeze that as well!

Cloth Diapering can save a ton of money! I like to think about all I have saved since I have cloth diapered my three kids ;)

Happy to help you get started if you are really interested. I promise it is not hard at all! do you have older kids still in diapers, you can get started with them right now

[Lilbutterflie]

My first thought is; why are you holding spots for siblings for FOUR months?? That is way too long for any struggling daycare provider to hold a spot for. I worry that you will take on another family to make up for their lost income, term them in March, and then the sibings will decide NOT to come back b/c you cannot lower their rate as she asked you to do.

I would sit down with the mom of the siblings, discuss with her that this is your business, and you just cannot financially hold one spot, let alone two spots, for her for such a long time. If you happen to have their spots available when they return, then great! If not, she will need to look for care elsewhere. Another option is she can perhaps pay half the rate while they are gone to hold their spot. This is my policy for families who take extended leave up to 12 weeks, anything longer than this they have to discuss with me so that I can decide whether to hold the spot or not. If you can get her to agree to holding the spot, then you will have at least half of that income. If she decides to take her chances when they return; then you will not have any worries or stress about filling their spots and having to term in March. It's a win win situation.

[Meeko]

Have a yard sale. Sell anything you aren't using all the time. You'll actually feel neater in your home and fatter in your wallet!

Take a few weeks to gather stuff for the sale. Otherwise it'll just be clothes and nic-nacs. I bet if you really think about each room, you'll find furniture etc that will bring in a few dollars. Remember you can always replace things later on.

Use the yard sale as an opportunity to advertise your day care. Maybe a sign offering some evening or weekend care. You will probably find people that will need evening care so they can shop/attend work parties etc over the holidays.

Offer a parents night out weekly and/or monthly for a fee. Every penny counts.

Good luck and I hope it turns out OK. Plan NOW!! :):)

[Blackcat31]

My family with sibs is gone from November - March. (This is my problem) They make up 1/2 of my income.

The other child I watch is a doll, but his mom is flaky with payment. I always have to chase it down from her, but I always get it sometime during the week, it's just a pain.

Are you charging a holding fee of some sort for this sib family? Even if you aren't...you still can. I have often made arrangements with a family because I could and then my situation changed and I had to go back and basically say,
"Dear DCF;

I had no issues offering you the leave you wanted to take without a holding fee as I was financially able to do so. However, my situation has taken a drastic turn and I am unfortunately no longer able to be as flexible as I was and will now be requiring a holding fee for your space. If you do not wish to pay to hold your space, I will need to fill the spaces in order to maintain my own economic stability. Thanks for understanding.

Sincerely,

DCP"

The mom who pays late, I assume you are charging a late fee for her late payments? If not, you need to start. You can make a lot of extra money by collecting off of someone's else poor payment behavior. I increase the late fee for every time the payment is late. Why should their poor planning or payment behavior be your problem?

If she needs your services, she will find a way to be on time. If not, then she will pay the late fee and you will make a little extra cash. Honestly, right now she is paying late because YOU are letting her.

As far as planning, I would also subscribe to some thrifty newsletter/blogs as there are hundreds of them out there that can give you tips, tricks and ideas on how to save money. I would start here as this site has a list of the top 20 thrifty, frugal and penny pinching blog sites to give you some great ideas on how to save a penny or two: http://www.greenecoservices.com/frugal-and-thrifty-blogs/

This is also a popular one:
http://penny-pinching.blogspot.com/

[SunshineMama]

My first thought is; why are you holding spots for siblings for FOUR months?? That is way too long for any struggling daycare provider to hold a spot for. I worry that you will take on another family to make up for their lost income, term them in March, and then the sibings will decide NOT to come back b/c you cannot lower their rate as she asked you to do.

I would sit down with the mom of the siblings, discuss with her that this is your business, and you just cannot financially hold one spot, let alone two spots, for her for such a long time. If you happen to have their spots available when they return, then great! If not, she will need to look for care elsewhere. Another option is she can perhaps pay half the rate while they are gone to hold their spot. This is my policy for families who take extended leave up to 12 weeks, anything longer than this they have to discuss with me so that I can decide whether to hold the spot or not. If you can get her to agree to holding the spot, then you will have at least half of that income. If she decides to take her chances when they return; then you will not have any worries or stress about filling their spots and having to term in March. It's a win win situation.

I would never hold spots like that ever again. I agreed to holding the spots because they were one of my first daycare familiess and I didn't know what I was committing to. Now, I feel like since I have had them for 2 years, I can't just up and change things, I dont feel it would be right to do that to them. I know that they cannot afford to pay when they are off because one of the parents is not working during that time. Also, I have put a lot of time and effort into these kids (they are twins) and I really care a lot about them, and I would hate to lose them. I just feel like I have to be fair to our original agreement.

[Lilbutterflie]

I would never hold spots like that ever again. I agreed to holding the spots because they were one of my first daycare familiess and I didn't know what I was committing to. Now, I feel like since I have had them for 2 years, I can't just up and change things, I dont feel it would be right to do that to them. I know that they cannot afford to pay when they are off because one of the parents is not working during that time. Also, I have put a lot of time and effort into these kids (they are twins) and I really care a lot about them, and I would hate to lose them. I just feel like I have to be fair to our original agreement.

SunshineMama, here is where our business gets tricky. Not only is this a business, but it also gets very personal. I do understand that you originally agreed, when you were financially able to do so, to hold their spot for a third of a year. I do understand that you are also emotionally attached to the twins and don't want to lose them. But you have every right to explain to their mom about how their extended leave THIS year is affecting your business and your family. Your financial situation has changed drastically, thus you have to change your agreement. Think about it, she is ultimately asking you to hold TWO spots for a THIRD of the year!! That is CRAZY!!

I love Blackcat's letter, it explains things very well. I really urge you to think about talking to the mom about changing your agreement. Just because you hate to change your agreement and hate to lose the twins, should you and your family have to suffer financially every single year because of it???

[SunshineMama]

Are you charging a holding fee of some sort for this sib family? Even if you aren't...you still can. I have often made arrangements with a family because I could and then my situation changed and I had to go back and basically say,
"Dear DCF;

I had no issues offering you the leave you wanted to take without a holding fee as I was financially able to do so. However, my situation has taken a drastic turn and I am unfortunately no longer able to be as flexible as I was and will now be requiring a holding fee for your space. If you do not wish to pay to hold your space, I will need to fill the spaces in order to maintain my own economic stability. Thanks for understanding.

Sincerely,

DCP"

The mom who pays late, I assume you are charging a late fee for her late payments? If not, you need to start. You can make a lot of extra money by collecting off of someone's else poor payment behavior. I increase the late fee for every time the payment is late. Why should their poor planning or payment behavior be your problem?

If she needs your services, she will find a way to be on time. If not, then she will pay the late fee and you will make a little extra cash. Honestly, right now she is paying late because YOU are letting her.

As far as planning, I would also subscribe to some thrifty newsletter/blogs as there are hundreds of them out there that can give you tips, tricks and ideas on how to save money. I would start here as this site has a list of the top 20 thrifty, frugal and penny pinching blog sites to give you some great ideas on how to save a penny or two: http://www.greenecoservices.com/frugal-and-thrifty-blogs/

This is also a popular one:
http://penny-pinching.blogspot.com/

Thanks for the links!

I also have a fear that if I do ask them to pay to hold a spot- what will I do if they decide they dont want to and replace me? I know I will have 3 months to fill 2 other spots but that isn't always easy to find. Well, there are a ton of people who want me to watch their infants, which I could always do if I have to, but Ireally do not want to provide infant care with a newborn. I think it would be too hectic. I will have to think seriously about this. Of course, I will make whatever difficult decision that has to be made to protect my family, but I want to find every other option first.

I do like the idea of a yard sale as well. Back when things were good, I gave away an entire kitchen set (fridge, gas stove, microwave, dishwasher) for freee to friends and family. I wish I would have kept those! Sigh

[MarinaVanessa]

If you're $1,500 in the hole total for all of the months you'll just have to be a little more creative when it comes to savings.

Make a list of what you are going to buy at the store based on the store specials. Then look for coupons for those items. Pay close attention to the prices per oz. Buy store brand and generic for the time being if it's cheaper. Don't buy anything that isn'ton your list. Freeze what you can.

Use coupons. As obvious as it sounds there are LOTS of people that don't because it's time consuming.

Like others recommended, use cloth diapers. You'll need at least 12 and will have to wash them every day or two. I recommend Bum Genius pocket diapers because they are adjustable and will work from newborn to toddlers. I'd also get disposable liners, this will catch the #2 and make it easier for you to clean them and keep them looking nice. I used them with my son and spent a little under $150 for the diapers, disposable liners, extra cloth liners (for extra absorbancy) and 2 wet/dry bags and I made that money back within the first 2 months of using them ... easy.

Another way to save is to use household items as cleaners instead of commercially made cleaners. For example instead of buying glass cleaner use white vinegar, it works just as well and costs less. A 2 liter bottle of Windex from Wal-Mart in my area costs $4.98 which comes out to .13oz. and a 1 gallon bottle of the wal-mart brand of white vinegar is $2.50 which comes out to .02 an ounce.

I also use white vinegar instead of dishwasher rinsing/drying aid, floor cleaner, carpet spot remover and in combination with baking soda as a drain cleaner which is WAY less than buying the store stuff. Baking soda instead of Ajax, isopropyl alcohol as a disinfectant, cornstarch to polish furniture and borax and washing soda instead of dishwasher soap.

Instead of paper towels use washcloths/terry cloths and reuse them.

If you use a swiffer use terry cloths instead of buying the refills.

The positive thing about using these as cleaners is that you can advertise as a Eco-Healthy daycare since these are "green". Using less waste allows you to advertise as Eco-friendly.


As far as losing the kids for a few months, I agree with others and say that I wouldn't have saved the spot for that long. I would have required a holding fee or just advised them that they were taking their chances and not held it at all. I dislike taking on siblings (one of the reasons that I don't give sibling discounts) because you run the risk of losing much more of your income at once if the family goes on vacation or leaves. I prefer singletons but do take siblings as long as they keep their financial obligations (pay full tuition, give 2 week deposit and pay the first week of childcare for EACH child in full) and I wouldn't hold a spot for that many months. The most I do is 2 months. JMO of course.

And I wouldn't feel bad about letting a PT child go either to stay within ratio. Business is business, it's not personal. On that note you may just want to play with idea of finding a different family to take the place of the family that will be gone if they are planning on doing this every year. Either that or raise their rates. Food for thought :)

[SunshineMama]

Thanks for the cleaning advice! I am going to look into making my own cleaners and less paper towel use!

I am a super-couponer and am pretty good about getting really good deals on groceries. I also unplug everything when not in use, which saves almost a hundred dollars a month (try it sometime and see- its awesome)! :) This is why I am so scared about things to come: because I am very thrifty and money conscious already. I am not on cloth diapers though- I will have to look into that a little more.

I figured the amount of extra money that I need to get us by for those months is about $6,000.00. So as I see it, I have 4.5 months to save and get that amount. I'm going to sell some things around the house, advertise another part time spot, save extra now, and take a lot of the advice given on this thread.

I agree about not wanting to take sibs in the future, especially sibs who need 4 months a year off without paying. I had no idea how financially devastating it would be to my family. It was bad last winter when I had 2 other full time daycare kids and I didnt have to take time off to have a baby. I'm probably going to only get a week off from my oldest dcb for maternity leave before I have to be back to work.