Dealing with Debt - introduction

SephardiLady (author of the Orthonomics blog) is a dear friend of mine. Her blog is dedicated to addressing financial issues in the Orthodox community. She recently has been following the responses to this Yated article, in which a rabbi expressed some sympathy toward a community member who confided his struggles with debt, then proceeded to blame it on trying to live a fancy lifestyle. The letters that followed (those which she has posted with her comments) have been bringing up the reality that some people are struggling financially and not living an expensive lifestyle.

This is obviously a meaningful topic for me, and even more so after I read today's post. SephardiLady and the commentators offers an extensive list of cost-saving techniques for grocery shopping. Now, there's nothing wrong with saving a few dollars. (Unless you end up using more gas to get the savings...) And SL truly lives what she suggests - she is an expert at what she calls the "art" of coupon clipping and finding bargains. Again, this is not a bad thing. But I came away from the post feeling like the point had been lost, and that maybe there is really a lack of understanding of how serious the debt situation is for so many families.

So we have three groups with financial problems:

1. People who make enough to live normally or even well-off, but waste their money on showing off, having fancy clothes, gigantic parties, etc. This is the group that the original article was addressing. This is basically an attitude problem, and antithetical to truly being a religious person. (In any religion, I think.)

2. People who make just enough, and can end up with a better standard of living and more savings for the future by clipping coupons, bargain shopping, etc.

3. What seems to be hard for everyone to understand is that there's a third group of people for whom even saving $1000 a year on grocery costs would make no difference to the depth of their problem. This is the group pleading with the rabbis and the community to figure out how they can do all the things that they have been told are necessary to living a religious life and still have food on the table and shoes for their kids.

The overall focus of financial advice is to look at your monthly expenses and see what you can cut. And the suggestions are usually things like switching to a cheaper car insurance, using coupons, or maybe an extreme like giving up your cell phone. Now imagine the following (real) situations:

- No health insurance (My husband and I went without for over a year, and my kids still don't have. And I have a friend who went years without.) By the way, no health insurance means forgoing health care too.

- The same friend cut his gas bill - by letting his gas be shut off. So he has no stove to cook on.

- Wearing the same four outfits repeatedly to work because that's what I have. This is something that has kept a number of people from going to shul - they simply don't have even one decent outfit that they won't feel humiliated in. I'm not talking fancy, I'm talking about something that isn't torn.

- Paying only the bills that are threatening to shut off this month. Calling the company and asking what is the absolute minimum to prevent shut off. then not paying again until the next threat.

I truly hope that most people can't imagine getting to this point. I truly hope most people can solve their problems by shopping sales and similar measures. But for a growing number of people, the financial issues can't be solved with these measures.

What I'd like to discuss in the next few posts is another version of looking at your expenses. I want to look at those areas (mainly in Orthodox life) which are so accepted as "required" expenses that no one wants to consider whether they can be cut or eliminated. Yet these are the high-cost areas that would actually start resolving people's problems.

I came up with five categories to start the discussion: food, Shabbat/Yom Tov, clothing/headcovering (both men and women), simchas, and private school (AKA "the tuition crisis").