All done with our taxes! I e-filed both federal returns for free and am hard-copy filing the MN state ones. I'll be mailing out AS's today since she gets a refund; I'll wait to send out mine and NT's until we get our federal refund, since we owe a bit.
AS's refunds are bigger than I anticipated, over $1700 total. I'd be annoyed that we were that far off except 1) it was a total wild-card year, with a home business and unemployment, so better a big refund than owing, and 2) I've been eyeing my 2010 goals a bit worriedly, so the unexpected extra money will help tremendously.
I knew that last year was a little hard; due to furloughs and AS's layoff we had to cut back here and there. But I didn't realize to what extent until I looked at our completed returns next to our 2008 tax returns.
AS 2008 total income: $39,970
AS 2009 total income: $19,985
CJ/NT 2008 total income: $89,768
CJ/NT 2009 total income: $79,138
Combined 2008 total income: $129,738
Combined 2009 total income: $99,123
Wow, that's like $30,000 difference! We certainly didn't feel that kind of pinch in 2009.
The contributing factors to the income difference were AS's layoff for most of 2009, my furloughs and health-insurance cost increase, and NT's furloughs and lack of bonus. (Needless to say, none of us got raises either.)
The factors that made it doable, and the steps we took to cope with the smaller income:
-Stimulus program. I can't say enough about this; it really eased the burden of the layoff and furloughs. AS got $25 more per week for unemployment; we all got reduced tax bills and less withholding throughout the year; and the lump sums at the beginning really helped, too.
-Fewer bills. Luckily we'd aggressively attacked our debt in 2008 and knocked out a number of monthly bills, so our budget was already less tight and so absorbed the financial blows much more easily than it would have before. In a stroke of luck, our adjustable-rate mortgage actually adjusted downward at the end of the year, so we had two months of lower payments there.
-Gradual budget cuts. Whenever our income got reduced, we cut back in little ways rather than one big drastic cut. We reduced our grocery/household spending by $200 per month, reduced discretionary spending money in small increments, and cut back a bit on extra debt repay.
-Lifestyle adjustments. Besides monitoring our grocery costs more closely, we switched from a family contract cellphone plan to three prepaid phones (saving an average of $20 per month), and took a downsized fall vacation to Wisconsin instead of doing one of our big blowout trips.
-Frugal pregnancy. Although I misstepped when I chose the high-deductible insurance plan (which ended up costing us quite a bit more than the other plan would have), in everything else we've tried to be sensible. We've openly solicited hand-me-downs from friends and have avoided buying most of the supplies and furniture needed for the baby. In the grand scheme, what could have been a budget-buster in such a tight year hasn't been a financial strain at all.
That's all I can think of off the top of my head; I'm sure there were other factors but that's most of the biggies.
Drastically reduced income in 2009
February 9th, 2010 at 05:12 pm
February 9th, 2010 at 05:34 pm 1265736886
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February 9th, 2010 at 07:16 pm 1265743019
Suzanne, we spent half our time in & around Madison and half in Door County (stayed in Ephraim, but drove all over the peninsula and went to the big island at the tip too). We loved it!
February 10th, 2010 at 12:25 am 1265761519
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February 10th, 2010 at 04:37 am 1265776622
Baby's are not expensive at all, its when they get older..... ahhhhh!
February 10th, 2010 at 05:34 pm 1265823262
I second what boomeyers said! I thought this was going to be a "cheap" month as far as the "kids" category went. Not! $60 for soccer for one son (plus he needs a new uniform, cleats, shin guards, and soccer ball - but not til April 5), $42 for Father/Daughter dance, $20 for Boy Scout Blue & Gold dinner, and even a $5 gift card for the V-Day grab-bag that daughter needs for a party), etc, etc, etc.
It is nice to see that you were able to weather the difference without much ado! As for me, I'm finding that I'm able to minimize the damage of feeling "poor" by doing micro-planning!