Financial Setbacks

ChallengePaying off debt is hard enough when everything is going well. It’s even harder when you come face to face with financial setbacks. I’ve recently experienced two setbacks that are delaying my debt reduction.

The first happened in November when my son was born. The birth was complication free, but the hospital bills were still high. Before we had left, the hospital offered to settle our bill for $3,584.00. I asked them if that was the best they could do. They said yes, it was the best they could do. In fact, for the first day alone, our bills were over $13,000. I’m not even sure what the second day cost.

Obviously, I enthusiastically agreed to pay the much smaller bill of thirty-five hundred bucks. Fortunately, I had the cash to pay the bill. But it was money that could have otherwise paid down my debt.

Now I’m getting more bills. There are a few smaller bills: a hundred bucks here, a hundred bucks there. Then there’s a $2,000 bill for my wife’s epidural. I may be able to get that bill reduced, but I’m not sure. So far, I’ve been avoiding the bills since I don’t really have the extra money to pay for them in full. I will probably have to make payments on at least the one large bill.

The way I’ve figured it, the pregnancy and delivery will have cost us about $8,000 when all is said and done. I guess that’s not too bad for paying out of pocket. Still seems like a lot of money though.

The hospital bills are one thing; tax bills are another. I just went to my CPA yesterday and discovered I owe about $10,167 to various government agencies. Worse, the taxes are due by January 15.

It is my fault for not planning better. It is something I need to correct this year. But the fact is, it is very difficult to plan when your income goes up and down every month. That’s one down-side of being self-employed.

On a positive note, I was in a similar situation last year. God provided just enough money to cover my tax bill. I had $16 left and didn’t have to go into debt to pay my taxes (praise God!). Right now, I’m trusting God to provide again.

I am reminded of the story about Jesus in Matthew 17. He tells Peter to go to the lake and throw out his line. In verse 27, Jesus says, “Take the first fish you catch; open its mouth and you will find a four-drachma coin. Take it and give it to them for my tax and yours.”

This passage gives me comfort when I think about the money I owe the government. I believe God will help me pay my taxes. And if I am able to meet my deadline, it will be to God’s glory, just as it was to His glory that I was able to pay my taxes on time last year.

Financial setbacks are bound to happen. They won’t be fun, but you may learn some important lessons along the way. For instance: faith, perseverance, and contentment. Learn to deal with financial setbacks appropriately, and they may become times that you look back on and treasure for how much you grew as a person.

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8 thoughts on “Financial Setbacks”

  1. I feel for you. I know how those unexpected fees come into play. Especially one’s you really didn’t want in the first place. Medical are the worst, because you really didn’t want to have to deal with the medical situation.

    If you have another baby you may want to look into many of the painless child-bearing information out there. Epidurals, etcs., really shouldn’t be necessary for a healthy pregancy. A lot of the pain is apparently related to stress. Prior to the hospital births many women had babies in their sleep or while relaxing in the bathtub.

    That aside, it’s really about chiselling down one’s expenses while increasing one’s income. Saving 10% as well as paying off with 10%. Living a good 30% below one’s income (when possible) either by decreasing expenses or increasing income (or both).

    I’ve been amazed at how many things I thought I needed, that woudl make life better, and made little difference. Even health-related “necessities.”

    Best thing for health, I’m seeing more and more, is time off, relaxation, fresh air, exercise, good food…

  2. I’m with you, John. Pregnancies should not be the big hospital ordeals that they are these days. But I’m not the one having the baby, so I’m limited to an advisory role. Apparently, my persuasion skills are not as powerful as the fear of pain during labor. ;-)

    I agree: We require very little for happiness. We actually don’t need that much.

    The other day I was watching a segment of Planet Earth, a truly amazing film documentary of the earth and its animals. The documentary was created by the BBC and some British filming guys.

    It was truly incredible how many days they could spend in the field looking for elusive animals. All they had, in most cases, was a small hut, a cot, and basic amenities like food and water. And these guys seemed to be very happy.

  3. We also own our own business and have to deal with estimated taxes. After the first year I figured out that our taxes averaged out to 19.5% of our gross income. I started saving 25% off the top of every payment we get and I put it in a high-yield savings account. I use the money to pay our estimated taxes throughout the year and then whatever I have left after I file my taxes I put in our IRA’s. It’s a great system, I never worry about not having enough to pay for taxes. On top of that, I’m earning interest on the money unlike most employed people. this year i earned $250 on my tax savings. This has been the best stress-relieving technique I have found for self-employment and taxes!

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