Severe Debt, Extreme Measures

We (my sister and I) cut down everything possible when I lost not 1, but both of my jobs within months of each other in 2008. Magazine subscriptions, stopped renewing them. Newspaper, stopped buying it. Out to eat, stopped going. Buying Avon, no more. Trips to the local gourmet grocery store, which was in addition to our weekly grocery shopping, ended. Air conditioner on all day, every day whether it was warranted or not, stopped. Buying meat, and just about everything else, not on sale or brand name, no longer. Delivery of food directly to our home, cut that off. (Yeah, we eat a lot!) We went to our church’s food pantry a lot during those first few months, too, and glad we were able to do that. Called every creditor we had and reworked loans, at least with the ones who were willing to do that. Of course I had unemployment insurance for a while, so that helped until it ran out. Praise God I was employed full time within 7 months of being laid off, but at a much lower rate of pay so we were still having to make more adjustments. I had a lovely friend who, under the influence of God’s prompting, pay off what I owed on my living room furniture, about $1800. My sister took on more of the household expenses, even though she made less than I did before I lost the jobs. And finally, about a year ago, we let go of the one big expense that neither of us wanted to, our satellite TV package. We’ve learned to do other things in our leisure time–read more, make jigsaw puzzles, cook more (and eat what we cooked rather than going out or bringing in!), spend more time with friends and at church activities. We still watch TV, with an antenna and Apple TV, but no longer to the extent we did before, hours upon hours on end, especially me. If there’s a show I want to see on, say, Food Network, I go over to a friend’s house and have a nice evening there, visiting and watching the show. All was not peaches and cream, however. We got behind on our mortgage and went through 2-1/2 years of negotiating and interminable waiting to see if we could get a modification, which we finally did several weeks ago. It’s been a long road, but with advice from people like Mary Hunt and others, we are on our way back to financial security!

My husband and I sold our dream house after 12 years, for a small loss. Then moved to a small rental in a beautiful neighborhood. Our outgoing monthly expenses have dropped by nearly $1,800 a month! (But really I think it’s been a lot more than that because the hot water heater in our new home had to be replaced recently, but the landlord had to cover the cost… had this been our old house we would not have been able to afford the cost of a new unit!) Smaller house equals less electricity, etc. Tough decision, turned out to be the best decision of our lives. We are both happier, which means are kids have happy, loving parents again.

It’s a good article but I do have some questions. Regarding the woman in the story, Patty, who lost her insurance: My understanding is that if someone loses their benefits because a spouse lost his/her job, then it’s considered a “qualifying event.” That means the person does not have to wait for an open enrollment period to enroll in their employer’s benefit plan. Is that true everywhere or just some employers?
Also, even if Patty had been ineligible for benefits at her own job, she and her husband could have used COBRA due to his job loss. I realize it can be expensive, but probably a lot cheaper than the bills she incurred later. When a friend was in a similar situation, she said they had a period of time to elect to use COBRA, so they didn’t have to decide right away.
It is awful when people have financial problems on top of medical issues, but in this story I am not sure why she was unable to have any health coverage. Any comments that could clarify things?

i also have severe medical debt – insurance companies pay less and charge more out of pocket – these stories give me hope that there is light at the end of the tunnel…