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Originally published September 15, 2012 at 8:00 PM | Page modified September 16, 2012 at 8:07 AM

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Stay-at-home mom works finances

A stay-at-home mom and her husband struggle to make ends meet and a financial planner comes up with a strategy to get them back to feeling financially healthy.

Special to The Seattle Times

Would you like some free financial planning?

IF YOU WOULD BE INTERESTED in a free financial makeover in exchange for having your story and photo published in The Seattle Times, answer a few questions at yourmoneysurvey

Would you like some free financial planning?

IF YOU WOULD BE INTERESTED in a free financial makeover in exchange for having your story and photo published in The Seattle Times, answer a few questions at yourmoneysurvey

In Katie Porter's runner's world, no pain means no gain.

But when it comes to the Lynnwood woman's household finances, that mantra isn't adding up.

As a work-at-home mom of a preschooler and the primary budget-and-bills handler in her marriage, Porter, 30, says she is feeling the strains of chasing a smoother family financial track -- only to fall further behind.

After Katie and her husband, Will, married 10 years ago, they enjoyed the freedom of spending both of their paychecks -- his, from working in the U.S. Navy on the East Coast; hers, from a civilian job with the military in the same place.

When Will left the service several years later, he tapped into G.I. Bill education benefits and the couple moved to the West Coast to be closer to their families.

His studies helped him earn a degree and -- later -- secure an Eastside-based job as an engineer, specializing in heating, ventilation and air-conditioning (HVAC) systems. The position included matching money for his 401(k) plan for retirement.

Meanwhile, Katie left the workforce to raise their daughter, now 4. Together the couple agreed that she would "take care of stuff at home" -- including the household finances. In fact, she said she's been "in charge of our money since we were married."

She's not the only one tackling finances this way.

According to U.S. Census Bureau figures, 14 percent of U.S. women with a child under 18 are stay-at-home moms. And a Pew Research Center survey shows that 63 percent of American wives say they pay the family bills.

At first, says Katie, budgeting was "doable" -- but "man, that kid could go through diapers."

The couple had enough money to buy a house in Lynnwood with 4 percent interest on the mortgage -- and for each to take up a new hobby. To make new friends, get fit again after the baby and cut her stress, Katie started running. Will took up bicycling.

But soon the bills were outpacing Katie's budget.

"My husband works hard for all of us -- even overtime," says Katie. "But there are times, after we budget out gas for our cars, there's not even enough left over for me to get a haircut ... so my hair waits.

"I can come up with a basic plan, but there are obviously holes because we aren't even living paycheck to paycheck," says Katie. "I know I need to stop the credit-card use, but it's so hard when the money just seems to run out."

Getting a plan

Tired of bills running in circles, Katie filled out an online survey to participate in a free financial makeover with a member of the Puget Sound Chapter of the Financial Planning Association.

After the couple's first makeover meeting, chapter member Kathryn Garrison, a certified financial planner with Seattle-based Moss Adams Wealth Advisors, had some encouragement and some tips for the Porters.

"Really and truly, they're not way over budget each month," says Garrison.

But they are using their credit card too much, she says. To get on top of their challenges, Garrison advised the couple to "figure out exactly where all your money is going."

She pointed Katie to -- a free website that organizes and categorizes an existing budget and tracks spending through colored charts.

The website is easy to use, says Garrison.

"The biggest challenge," she told the Porters, will be getting their monthly spending far enough below their income so that they can hit three goals she set for them: "pay off the credit card, get an emergency savings account set up, and defer more income into Will's 401(k) plan."

Easier said than done, says Katie. Despite using the website, she says "old habits die hard."

Even so, she and Will are now looking at ways that they can save on their $500 monthly fuel costs. Since he works overtime, all three agreed carpooling isn't realistic, and transit is inconvenient because there's a one-hour difference between a bus ride and his existing auto commute to work.

Consequently, Katie is going to search for ways to consolidate her errands and trim the grocery budget. A halfhearted coupon-clipper in the past, she says she is now "stepping that up to save on groceries."

Garrison -- a working mom herself -- knows it can be tough.

"Let's say you're a working mom or you're a mom who is home with the kids all day," says Garrison. "It is so easy when you're tired to say, 'Let's just go out to eat' -- but that is so much more expensive. But if you make a menu for the week and create a grocery list, it takes care of that mental block about cooking dinner when you're wiped out at the end of the day."

Despite Katie's concerns about whether to cut their hobbies, Garrison gives both a thumbs-up.

"Running and biking are healthy, so in the long run their life-insurance premiums should be lower," the adviser says. Her caveat: "Save a bunch of money traveling to do those sports and stick closer to home."

While Katie is focusing on trimming their spending, Garrison encouraged Will to check out ways to beef his 401(k) contributions up to 10 percent of his income.

The adviser suggests setting automatic increases for his 401(k) at least once a year.

"That way, if you know you get a minimum 3 percent cost-of-living increase, it's a great time to increase your 401(k) savings 1 to 2 percent," says Garrison. "Over a few years, you won't feel it at all."

Trying to do too much too quickly, she adds, "is like dieting: You're more likely to fail if you go completely overboard at first."

Something else the couple -- and other veterans should pursue: "Check out a VA-guaranteed mortgage," advises Garrison. Right now, she points out, a Veterans Affairs loan is well below the 4 percent rate the Porters are currently paying.

"Another more general thing I would say about the VA is that if you even think you qualify for a benefit or any type of federal benefit, don't just sit there. Check it out," Garrison says.

It could make a difference in how the couple saves for their daughter's college education; some programs provide education support for a veteran's children.

Working together

Garrison's calls her final tips "general advice" for all couples -- and it's as personal as it is financial.

"I want them both to agree on the spending plan," the planner says. "There are relationships where one person manages the budget and the other person covers most of the bills, but you need both parts of the couple doing this together in case -- God forbid -- something happens to one of them. The more open couples are about money, the better."

For the Porters and other busy couples with children, Garrison encourages them to "set aside an hour to go through the budget twice a month -- maybe when the kids are napping or right after they go to bed, when you're not too tired. Have a glass of wine and have a discussion about where things are.

"If you're touching base every two weeks, you can see if you're off track and you can get yourself back on track quickly," she says. "After awhile, it won't take a whole hour, so you can use that for some quiet time as a couple."

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