We need a financial therapist!

Hi Terry,
I love hearing your financial advice on WGN. I am writing because my husband and I need something along the lines of a financial therapist to help us regroup and get our very disorganized and messy financial life in order. We have a lot of debt (a LOT) and my husband owns his own business. As a result, he is more in touch with the way our money flows (between the business and our family, business expenses and debt, etc) than I am, and although I keep insisting that we come up with a better way of planning, managing, etc, it seems that we don’t know where to begin. It seems like whenever we get extra income that we could use for paying off some debt or catching up, it just gets sucked up into the hole (current business expenses, bills) and it seems that we can never figure out a new way to approach the problem. It seems to me that most of the professional financial help that is out there is for investment management, but we really need someone to help us sort through the mess, help us build systems and get come up with a strategy for having a healthy financial life. We have a son who is two years away from going to college and we have no savings.
How can I find someone to sit down with us, look at the situation, and help us come up with a healthy strategy? Thanks!

Terry Says:  This is where a Certified Financial Planner comes in — one who charges only a fee, and is not trying to sell you a product.   But you are going to have to take the first steps yourself.  And I mean you — not your husband.  It seems that you don’t have very good communication — but I’m betting that he has an accountant, who is at least filing your tax returns and filing his quarterly business returns.  Are you being purposely left out — or are you just too timid to speak up and say you want to get organized and sit in on the process with the accountant.

You may need his/her help to sort out what you owe and what you own.  Here’s what you need, with the help of the accountant — or by doing your own detective work — before you can even seek help from a planner.

1.  Your past two years of tax returns –both your personal returns, and your husband’s business return.  If you can’t access these easily from him or the accountant, then you have a bigger problem than disorganization!
2. A list of all  your assets — including the current value of your home, of any retirement accounts (both your husband’s and yours, if you have one), any savings.  If you think you aren’t getting a full list, just take a look at the tax return.  If interest or capital gains are reported on it — you should know about the accounts that generated those items.   Similarly, if there are deductions for more than mortgage interest and property taxes on your personal return, you’ll want to know what’s going on.
3. A list of all your debts.  What’s the balance on your mortgage, and what is the interest rate? Do you know about every single credit card that has been taken out in your name(s)?   Get your latest credit report from www.AnnualCreditReport.com — and your husband’s credit report, as well.   Look for reports of payments on credit cards, or late payments on other debts.  You deserve to know where you stand.  List the outstanding balances, interest rates, and minimum monthly payment on each credit card.   And demand that the accountant give you the same information for his business accounts.  (You would be entitled to that info in case of a divorce!)  If he is the sole owner of this business, there is no reason for secrecy from you — his spouse!
4. Next, make a budget — or at least a list of what you spend monthly on necessities.  That includes all housing expenses, telephone, utilities, and the annual amounts for things like property and auto insurance ,life insurance, and property taxes.     You can do a budget online using Quicken — or simply get a budget book .  I recommend Judy Lawrence’s Common Sense Budget Kit — and if you click on the highlighted type it will take you to the page on Amazon.com where you can buy it and have it within 24 hours!

OK,  I’ve given you a good start on this project.  The next steps are up to you.  If you really want to GET control over your financial life, you will have to TAKE control!    So please write back when you have gotten this done — should take only a few weeks!  Then I will refer you to your requested “financial therapist/mediator!  I’m looking forward to hearing from you!