This morning, someone that works in our office comes to ask me to help her with her personal finances. This was completely out of the blue and I feel so honored that she would trust me with her money issues. She said she was thinking last night of who she could ask for help and thought of me... (after she got a denial yesterday from the local credit union for a new credit card account). Now, I'm on a quest to get her all squared away and you guys can come along on the journey. Here's her situation:

Married with 2 children (one in college and one in high school), but not a financially sound marriage ever, apparently... DH is a banker of all things but he apparently doesn't have his head on straight when it comes to their own money. He wants to keep everything completely separate in their household so the wife just deals with this (even though he makes probably 4 times what she does). For the major expenses, he covers the mortgage and utilities. She has to cover the groceries for the house.

Finances:

OUT categories we've identified thus far =
*groceries/eating out for household
*car payment on her car
*gas/maintenance on her car
*half of the household cell phone bill
*medical bills for household
*dog -vet/grooming bills
*multiple credit cards (highest balance is around $5k on one of them)
*three outstanding medical debts

She had her highest balance credit card statement with her and said she thought the interest rate on it was 90% (gasp) and I was like, um -- doubt it? So, I looked on her statement and showed her where the interest rate was indicated which is something like 25%. As you can see, she doesn't even know how to read her statements. She's a college graduate but when it comes to money and math, she's clueless and knows that is why she's in the trouble that she's in.

I gave her homework for the weekend -- I've asked her to write down exactly what her interest rates are on all the credit cards and their current balances. I told her to call each one of those credit card companies and ask for a lower interest rate. She also needs to identify exactly how much she owes on those outstanding medical bills and to estimate how much her other monthly expenses total up (she had no clue how much she spends on groceries, for example).

Next, I asked her about her paycheck. Since I have access to payroll, I looked up her check and all her deductions. She has zero withholdings and I asked if she gets a tax refund each year. Apparently, she just gives her W-2 to her DH each year and he does all the tax stuff. She does know that for 2009, they got back around $1500 total and then she got fussed at from her DH that it wasn't enough. He wanted the refund to be even higher and implied that she must not have withheld enough from her checks (jerk!). He keeps their refund and does whatever with the money even though it's "their" refund. I told her that was crazy. I calculated what increasing her withholdings to 1 and 2 would be, an additional $58 and $103 respectively, in each paycheck... Basically, by just increasing her withholdings to 1, she would have an additional $700 each year in her paychecks that her grubby hubby wouldn't have access to come tax time. She said she's all about having her withholdings changed to 1 now. Yay.

Anyway, I'll post more as we keep ironing out her budget...