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FacebookTHE ECONOMY:
When a recession hits home
Tiffany Brown
Jack and Elizabeth Safer’s bedroom is almost empty because they had to sell their furniture to pay bills. They’re planning to keep Pebbles, the dog pictured, but give away their Dalmatian, Pongo. Elizabeth lost her job 11 weeks ago and Jeff’s pay at a new job is half of what he had been making.
Sun, Nov 2, 2008 (2 a.m.)
Sun Topics
Las Vegas is in a big hurt.
We know the indicators. Homebuilding has all but halted. The state’s population — the fastest growing in the country since the early 1990s — has shrunk. The unemployment rate is 7.3 percent, more than a full percentage point above the national average. Our foreclosure rate is five times the national average.
Numbers, numbers and more numbing numbers.
Maybe the story of the economy is best told one life at a time.
They’re running out of stuff to sell; what will they do to pay bills?
Jack and Elizabeth Safar had been struggling to pay their bills even before she lost her job as a car insurance saleswoman 11 weeks ago. Sometimes they got by. Now, they don’t.
Jack Safar, 40, hasn’t been able to earn more than half the $6,000-a-month salary he raked in as an auto body mechanic before a 2007 eye injury, and his 38-year-old wife, who hasn’t qualified for unemployment, has yet to find another job.
They have no savings, and only $30 in their wallet.
Elizabeth spends much of her time now in the Los Angeles area, where they’re from, hawking DVDs and other possessions at swap meets. They’ve sold about 400 DVD movies, the likes of Spider-Man, The Mummy and X-Men, for $5 or $6 each. She crams dishes, china, silver and whatever else might fit into two pieces of luggage for her $40 one-way bus ride on Greyhound; she can’t afford to drive or fly, and she stays with a friend.
The master bedroom in the house they rent is all but empty of furniture. They sold their 2-year-old, $2,500 bedroom set for $450. A second bedroom also has been emptied, except for the 70 DVDs they have yet to sell.
They are buckling under their living expenses. They’ve got 14 months more on their lease, with rent of $1,250 a month. The monthly payments for their 2002 Ford Focus and a 2004 Saturn Vue total $620.
There’s no way Jack’s salary alone can pay the bills.
They’re not sure how to pay the $93 Southwest Gas bill, and worry about losing their hot water this week.
They’re planning to give away their 3-year-old Dalmatian, Pongo, but keep Pebbles, their 7-year-old Yorkshire.
It’s possible their bedroom set in the guest room will have to go. If so, they’ll be sleeping on the sofas in the living room, near the TV that still broadcasts, perhaps inexplicably, $40-a-month worth of DirecTV. It feeds an older, smaller TV; they sold their big-screen.
This was not the life Jack Safar pitched to his wife in 2007 when they moved here from California on the promise of a good-paying auto-shop job with paid vacation, group health insurance and a 401(k) retirement plan. But several weeks after he arrived at his new job, Jack’s right eye was damaged by a flake of flying metal. He said he lost his job and collected $6,400 in workers’ compensation.
The couple had to cash out the $10,000 in their retirement plans.
After eye surgery, which was paid for through the workers’ comp case, Jack got a job at another body shop but is making only half what he had been making.
That’s when they started visiting pawn shops.
— Brian Eckhouse
Less demand for clean carpet leaves man with lot to pay, little to save
Wally Grogitsky, owner of Certified Carpet Cleaning, says over the past 18 months, he's gotten fewer jobs from homebuilders and real estate agents who need homes spiffed up to sell.
Wally Grogitsky has four teenagers, four dogs, three cats and one 21-month-old foster child with health problems.
He faces $9,000 in bills every month — the cost of his carpet cleaning business, the mortgage, the groceries and utilities and the like. And he’s making only $10,000 a month, so there’s not much left over for emergencies.
Grogitsky used to set aside $3,000 every month — to buy his children new clothes, to go to movies, to fix the family car. No longer.
Two years ago, he might have replaced his broken watch. Not now, though. When a circuit breaker blew in his master bedroom, Grogitsky and his wife went without light in the room for two months before finally hiring an electrician.
Grogitsky had one employee, but he let him go in October. Over the past 18 months, half of the home developers who hired him to clean their model homes have stopped calling. And almost half the real estate agents who called Grogitsky for shampoo jobs aren’t even agents anymore.
He has tense conversations with his wife, who makes a point to remind him, even though they both know, that the mortgage is due again.
“I don’t know if any of the stuff the government is doing will help me,” he said. “I’m going to have to be my own light at the end of the tunnel.”
Grogitsky is a master carpet cleaner, certified in specialty messes: Fire damage, water damage, Persian and Oriental area rugs. He’s been doing it for 14 years. In 2000, his company, Certified Carpet Cleaning, cleared a quarter of a million dollars. Then he was diagnosed with cancer. Then his business partner started embezzling money from the company. Then he divorced his wife.
In 2002, he beat the cancer, lost the business partner and remarried his wife. Certified Carpet Cleaning was back on track.
And then the economy collapsed.
“With the cancer, my mantra was, ‘It’s only temporary.’ I beat the cancer,” he said. “But the economy won’t let you go.”
So he’s getting handyman jobs where he can — unjamming garbage disposals, installing ceiling fans, scrubbing tile grout, installing carpets, cleaning mattresses and couches.
The light at the end of the tunnel looks like a lot of manual labor. He is 48. He’s been getting headaches.
“It’s all a real bummer,” he said.
He’s paying attention to real estate statistics, and it looks like more vacant houses are being sold. That may mean more vacant houses with carpets to be cleaned. “That’s my ray of hope,” he says. “We’re close to the bottom, and maybe things will start turning around.”
Then a client calls. He wants to know if Grogitsky will accept a postdated check. He needs his carpets cleaned, but he doesn’t have the money just yet. It’s a question of about $150. It’s coming in a few days, the client says.
Grogitsky doesn’t have to think. “Sure,” he says. “Whatever I can do.”
— Abigail Goldman
Financial adviser finds his clients, himself in the eye of the storm
The day is almost over on Wall Street, the Dow has dropped again, Jeff Ballek is going crazy.
Jeff Ballek feels his clients' pain, as his financial services business suffers.
His phone should start ringing soon.
Ballek is a financial adviser, has been for 27 years. And lately he’s working 14-hour days, hardly has Sunday to himself and for his family, and finds he’s wearing a new hat, though it doesn’t figure in his 10 professional licenses: psychologist.
He listens to people talk about their fears after they see the Dow dip. Will they lose their jobs, their houses? Will the economy ever come back?
He tries not to answer those questions. He doesn’t have the expertise. He just listens.
Then he gets down to business: where or whether their money should be moved from one account to another, or out of one insurance plan or another.
He and his wife, Martha, who works in real estate, are buffeted by the same economic winds.
They moved here from St. Paul, Minn., three years ago.
Ballek was promised a job that didn’t come through and decided to build his own financial company from the ground up, offering services ranging from investment portfolios to life insurance. But by the time things were up and running, the Las Vegas Valley was becoming ground zero in the nation’s foreclosure crisis.
So Ballek’s household economy unexpectedly become a microcosm of the nation’s, because, taken together, he and his wife work in just about every sector that is struggling for air right now: insurance, stocks, credit, houses, mortgages.
The result: Where once upon a time, and for at least a decade, Ballek brought home six figures, now he’s earning about $75,000.
He maintains an office on the west side of town but has closed his Henderson office to save money.
The Balleks took their 6-year-old son out of private school this year for the same reason.
But what he wanted to talk about was not so much his own family but the clients he visits in town, or the ones he listens to on the phone, calling from Minnesota, Washington or Indiana.
There’s the Minnesota husband and wife in their 50s. He’s a contractor, she’s a teacher. He’s afraid he’ll lose his job. So emotions trump intellect. The man doesn’t listen to Ballek’s advice about keeping money in bonds. He doesn’t want to think about the future. He needs some sense of security now.
There are also the clients who call to cancel their life insurance or lower their car insurance because money spent on those premiums seems better spent on other bills.
And, for the first time, Ballek is getting calls from people who really are bottoming out, having lost their homes and their jobs.
Those people need to call someone else, he said — the Salvation Army, for example.
Shaking his head, he admits: “There’s not much I can do to help them.”
— Tim Pratt
Discussion: 19 comments so far…
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Sell furniture to pay bills. Very sad. There are other less drastic things people can do. I found this this site has ways to get help on bills, including heating electric, mortgages, etc. Help is provided from the gov't, companies, and others. For example, over 1.2 people people are targeting to get mortgage help.
http://www.needhelppayingbills.com
I truely feel sorry for you guys, but dont you have unemployment benefits in the States
uddeboda - it depends on the circumstances for unemployment benefits. The employer can deny them, or maybe she was straight commission.
Regarding the 1st story, they can break their lease, with a penalty, but it depends on what the lease states. Since they are in over their heads, sneaking out in the middle of the night is also an option. At her age, she can find seasonal work for the holidays. Hawking your items to pay you bills, they're in way over their heads. Get rid of the Direct TV.
Jack and Elizabeth,
Sorry to hear about your injury, Jack. To me this seems common sense, but here it goes:
1. Smart getting rid of your big dog.
2. Break your home lease immediately. You can find a room or apartment for rent for $700 a month on craigslist. It may require you to get rid of the other dog, or moving into a worse neighborhood. For $700 you can likely keep the small dog. Find a place walkable distance to shopping or a bus route.
3. Break the lease on one of your cars immediately. Everyone has bad credit these days so don't worry about it. You might be able to negotiate it so it won't hit your credit.
Two people can easily live off $36,000 per year if you get out of the consumerism mindset ($2,500 bedroom sets). Take these actions and you will likely keep yourself off the streets. Good luck.
I SYMPHATIZE WITH ALL OF YOU IN LASVEGAS,GOING TO FINANCIAL CRISIS.
WITH ALL THIS CRISIS HAPPENING AROUND YOU GUYS
DON'T FORGET THAT THERE'S GOD THAT'S OVER LOOKING ALL OF US.
MAKE SURE YOU PUT GOD IN YOUR LIFE.HE PUT YOU THROUGH ALL THIS CRISIS AND HE KNOWS THAT YOU ALL CAN HANDLE IT.
GOD BLESS ALL OF YOU.
Is this article about Jeff and Liz a joke? Seriously, is it for real? And I am suppose to feel sorry for them? What, you guys can't live off of 3k a month? Liz, how about getting a job at Walmart instead of taking bus rides to LA to sell off CD's. And what about the $92 gas bill? Oh boo-hoo, pass the kleenex!
My wife doesn't work and I bring home $2200 a month AND we have two kids and yet we live comfortably. How, you might ask? BECAUSE WE LIVE WITH IN OUR MEANS! Our gas bill for this month was $22. How, becuase we hang our clothes out to dry and make a concious effort to conserve in everything we do. Heck, I even take the kids out and we go can collecting. This teaches them about work ethic and how to use money for things like tithing, banking and spending.
To the Sun newspaper: this article is a joke!
To Jeff and Liz: Don't worry, Obama will soon come to your aid. So just sit at your 3000 square foot home and do nothing becuase I am sure I will have to spare some of my CHANGE to help you. GET REAL!!!!!!!!!!!!!!!
Laughable, BRAVO, at last someone who lives on a normal wage and within their means.
I was beginning to think the average wage in the USA was 200 thousand a year from all the reports from the politicians
Oh, for heaven's sakes! I just finished reading about Jeff and Liz's supposed problems when I scrolled on down to the Carpet Cleaning Dude (CCD). CCD, you too get a big BOO-HOO! You make 10k and your bills are 9k, that means you have an extra 1k for ??? Give it the Jeff and Liz, I hear she's got a fancy collection of CD's to sell. Oh, you use to have 3k a month for extra stuff like clothing and movies. Are you for real? Maybe you should have saved that instead of spoiling your four teenagers. Here's one for you CCD, how about sending out your children to get a job and maybe have them buy thier own clothing. I did that when I was young and I think I turned out okay. How about getting rid of that zoo of yours at home. "Four dogs and three cats." And how about the 21 month foster kid with health problems. CCD, you know that you get what $900 a month to care for him plus ALL of his medical is paid for by the state. This calls for another "GET REAL!"
I am not even going to read the last story on the financial dude. He's probably going to say that he had to give up Evian glass bottled water for the Albertson's brand water.
Shame on all of you guys to include the lousy reporter. This is what is wrong with America! Don't you all worry though cause the messiah will come this Tuesday.
It's interesting to note that the discompassionate and cynical responses are from McCain supporters.
This must be what losing looks like.
johnevegas said: It's interesting to note that the discompassionate and cynical responses are from McCain supporters.
This must be what losing looks like.
And I say: You are correct, Sir! I am very uncompassionate and cynical to all crying mentally diabled liberal slugs like yourself. You and your kind are a cancer to our society.
And yes I can admit that McCain lost. I lost, you lost, we all lost. You just wait and see Kommrade John
So he ONLY makes $3000 and she's 38 and UNEMPLOYED?? Give me a break - no sympathy on this end. There's ALWAYS some kind of a job to be found - maybe not the best paying but anything more than nothing is certainly something. From the sounds of what she's been selling at the swap meet I'd say they were perhaps living a little too large considering they had no savings....maybe a few less DVD's or CD's would have served a better purpose in a SAVINGS ACCOUNT??? This story hardly seems worth the time and effort it took to write about.
Oh, and btw, johnvegas - this uncompassionate (sounds better than DIScompassionate) person is certainly not a McCain supporter - hell, I'm not even an Obama supporter..........I'm the one who is choosing to vote "C - NONE OF THE ABOVE".
What I AM is a person who thinks people need to take responsibility for their actions and choices - be they good or in their case BAD....and stop the whining. One certainly does reap what they sow and they are living proof.
Although I am somewhat sympathetic to all of these peoples' plights, I am a believer in creating your own destiny. Some of the comments are practical, albeit rude, and there is some truth in how to manage in this economic crisis. Scaling back on a lot of things and planning for the future is paramount. We all saw this coming a year ago, they should've planned better.
I am curious, however, as to why Mr. Safer hasn't been compensated more for his workers' comp injury. Just having the surgery and then subsequently being "let go" from his job isn't legal, for one. And if he did get a nice sum for his future losses due to the injury, did he squander it? It wasn't that long ago, but I suspect it's what he bought his bedroom set and big screen TV with?
As for the small business owners, well, what can I say other than they poorly mismanaged their profits (mostly in the case of the carpet cleaner).
But the financial advisor, of all people, should have known better. Don't they follow trends? Wouldn't they have that nest egg in which to lie comfortably in in times of woe?
I'm confused. I'm a single mother of 3, making $60,000 a year yet I manage to live in a beautiful home in Summerlin, drive a nice car (which I obtained while married), pay all of my bills on time and still live comfortably AND have a savings.
I think it's about time people realize that this economy is one to be reckoned with. Play your cards right and you can do anything you set your mind to - even if it means having to lower your standards in order to make ends meet. I suspect it's only temporary----relatively speaking.
I am neither a McCain nor an Obama supporter. I am a thinking Las Vegas native who thinks the people featured in this story are part of the entitlement generation. 470 DVDs? Seriously ... WTF? Live within your means and take responsibility.
laughable "You are correct, Sir! I am very uncompassionate and cynical to all crying mentally diabled liberal slugs like yourself. You and your kind are a cancer to our society.
And yes I can admit that McCain lost. I lost, you lost, we all lost. You just wait and see Kommrade John"
Nice display of prejudice and adolescences. Thanks for making my point for me, as if it actually needed reinforcing. I'll pray you enjoy your karma as much as I'm enjoying thinking about it right now.
azsk8fan "What I AM is a person who thinks people need to take responsibility for their actions and choices - be they good or in their case BAD....and stop the whining."
By not voting? I'm really do not understand that.
"One certainly does reap what they sow and they are living proof."
Seems like nobody ever says that about someone when they are successful.
You can call it discompassionate or uncompassionate (neither gets past the spell checker), but it doesn't really matter. To me, it's the same thing.
To make the automatic assumption that someone's misfortune and suffering is because they are stupid, lazy, born in the wrong country, believes the wrong thing, made a bad investment (how many people is this true for today?), or just "whining" is prejudice and lacks humanity.
It also isn't fair to say they are whining because they happen to have more than somebody else. To make it extreme and visible, would we have any empathy for Bill Gates if he lost everything and had to go live in a single small mansion?
I would! I can barely imagine what the shock would be like. I'm sure he would be devastated and that any of us lucky enough to in his situation would be as well.
But from where we are it seems ridiculous. I get that. It's just as ridiculous to NOT consider our differences.
I posted the following on another article, but it fits for this one as well:
Today we mourn the passing of a beloved old friend, Common Sense, who has been with us for many years.. No one knows for sure how old he was, since his birth records were long ago lost in bureaucratic red tape. He will be remembered as having cultivated such valuable lessons as: Knowing when to come in out of the rain; Why the early bird gets the worm; Life isn't always fair; and Maybe it was my fault.
Common Sense lived by simple, sound financial policies (don't spend more than you can earn) and reliable strategies (adults, not children, are in charge).
His health began to deteriorate rapidly when well-intentioned but overbearing regulations were set in place. Reports of a 6 -year- old boy charged with sexual harassment for kissing a classmate; teens suspended from school for using mouthwash after lunch; and a teacher fired for reprimanding an unruly student, only worsened his condition. Common Sense lost ground when parents attacked teachers for doing the job that they themselves had failed to do in disciplining their unruly children. It declined even further when schools were required to get parental consent to administer Tylenol, sun lotion or a Band-Aid to a student; but could not inform parents when a student became pregnant and wanted to have an abortion.
Common Sense lost the will to live as the Ten Commandments became contraband; churches became businesses; and criminals received better treatment than their victims. Common Sense took a beating when you couldn't defend yourself from a burglar in your own home and the burglar could sue you for assault. Common Sense finally gave up the will to live, after a woman failed to realize that a steaming cup of coffee was hot. She spilled a little in her lap, and was promptly awarded a huge settlement.
Common Sense was preceded in death by his parents , Truth and Trust; his wife, Discretion; his daughter, Responsibility; and his son, Reason.
He is survived by his 3 stepbrothers; I Know My Rights, Someone Else Is To Blame, and I'm A Victim.
Not many attended his funeral because so few realized he was gone. If you still remember him, pass this on.
Funny postings. I must say. If Jeff and Liz's take home monthly income is 3000, that is, after taxes, they MUST be able to find a way to make ends meet and live comfortably... It is totally doable. It is just a matter of planning and responsibility. I feel sorry for the circumstances these people go through, but we need to look at this from the positive side: there's something to learn, for the future: saving is always a good habit. Don't buy as many DVDs, don't go for the 2500 bedroo set, have only one dog, get a cheaper $25/month cable service... a dollar here and there saves a lot!
Morgen, at last - the voice of reason - I don't understand why so many others can't seem to get that these people made the bed they now lie in - there are many far worse off than they.