Richelle Nelson never thought her family would worry about money.
They had savings in the bank, good paying jobs, high limits on their credit cards.
Nelson said that in 2008 she and her husband owed between $30,000 and $40,000 among all of their cards, and they were making payments of up to $1,200 a month when many of their credit card companies increased their interest rates.
"It put us in a really bad place," Nelson said. "It completely wiped us out."
They filed for bankruptcy in December 2009, she said. They repaid about 20 percent of their outstanding debt within five years and have never really felt stable since.
Nelson, who works for an insurance company, and her husband, Michael, a warehouse manager at a flooring distributor, earn a household income of about $123,000 a year, she said. At one time or another, they’ve each lost their jobs and found new jobs for less pay.
“Never in a million years did I think the rug would just be pulled out from underneath us,” Nelson said.
The Nelsons story is one in a series on Long Island’s middle class and the struggles it faces. You can add your story at newsday.com/middleclass.
Buying a childhood home
The Nelsons and their three children, Hunter, 13, Lauren, 12, and Emily, 10, live in a five-bedroom house on about 4,800 square feet. It's the house she grew up in; her husband grew up on the same street.
They bought the house, valued at more than $600,000, from Richelle's parents in 2005, she said. Almost $300,000 of the house's value was covered under a gift of equity from her parents, and the Nelsons took out a 30-year, $350,000 mortgage for the rest. Because they were already $150,000 in debt, the bank required that debt -- including student loans and debt incurred from their first house -- to be included in the mortgage.
In the past, Nelson has questioned whether it's fiscally responsible for them to keep the house -- especially after Michael Nelson lost his job in 2011 and they made only partial payments on their mortgage for 18 months, she said.
Pictured, Emily Nelson and her sister, Lauren, play in front of their North Bellmore home on Sunday, April 10, 2016, as their mom, Richelle, looks on.
'I started to half pay the mortgage'
The Nelsons "tried everything" to finance their house and pay off the debt, including taking out a second and third mortgage, borrowing off their 401k, and cashing in a life insurance policy.
Over the years, as their property taxes increased, Nelson said her mortgage payments were up to $4,200. When Michael Nelson was out of work, the payments became too difficult to make.
"I started to half pay the mortgage," Richelle Nelson said. "We had to do a modification. We got a 40-year mortgage at 5.75 percent. We're never going to get ahead at this point."
She said they now pay $3,200 a month including taxes, which is slightly more than what's required because they are trying to get the balance down quicker.
"We get to keep our house, that's the one positive out of all the negative," she said. "As long as the children feel happy, that they have a roof over their heads, I'm OK with owning the house."
Pictured, Michael Nelson, 46, and his daughter, Emily, 10, watch television in the living room of their North Bellmore home on Sunday, April 10, 2016. (Photo credit: Randee Daddona)
While trying to modify the loan for their mortgage, the Nelsons were introduced to the Hispanic Brotherhood of Rockville Centre, a nonprofit that offers a range of services including assistance with housing problems. The agency also connected them to United Way of Long Island's Project Warmth, through which they qualified to receive one month of heating oil and one month of electricity for free.
"We're not the normal clientele of that organization," Richelle Nelson said. "We are married, we do work full time but we still can't make ends meet."
The United Way featured Nelson in promotional materials for their program to encourage other middle class families to seek help when needed, she said.
"For a long time we got no help," she said. "I started trying to be an advocate for us. Fortunately, my girls think it's fun; part of that embarrasses my husband and my son."
Pictured clockwise from left, Lauren, 12, Richelle, 44, Michael, 46, and Emily, 10, stand together in the dining room of their North Bellmore home on Sunday, April, 10, 2016. The Nelsons son, Hunter, did not want to be photographed.
'I really thought credit cards were money'
Richelle Nelson knows she and her husband made mistakes that contributed to their financial woes. Did they really need a big house? She said she often wonders, but it seemed like they would be able to make it work at the time. The other mistake were the credit cards. "I really thought credit cards were money, and that was the wrong way to look at them," she said. "When we had high limits, I never thought, 'No, you don't need to buy this or that.'"
After the bankruptcy, the mortgage modification, job losses and pay cuts -- everything is different for them now. "Thinking fiscally is the first and foremost," she said. "It's at the forefront of everything nowadays."
Nelson does the family laundry on Sunday, April 10, 2016.
Making the budget work
Nelson said their $3,200 mortgage is about 50 percent of their take-home pay. She said they spend about $178 a month on electric; $100 on water; $25 on gas; $168 for insurance on cars that are nine and 13 years old; $150 on cable, phone and Internet; $140 on cell phones; and about $800 on groceries. They pay about $1,500 annually for oil and only get deliveries in the fall and winter.
"There is nothing disposable," she said. "Every penny is accounted for in my checkbook."
Because of the bankruptcy they don't qualify for credit, Nelson said. Sometimes when they are in need, her sister will buy them groceries on her credit card and Nelson will pay her bill, she said.
They do save some money, Nelson said. They put 8 percent into a 401k, though they are currently borrowing $180 per paycheck through a 401k loan to cover the costs of their son's bar mitzvah. Lauren, Emily and Richelle Nelson shop for groceries at their local market on Sunday, April 10, 2016.
"It is a daily struggle and it pains me to say 'No' all the time to our three children," Nelson said. Vacations just don't happen, she said, and they can't afford extracurricular activities for the kids.
To help compensate, Michael Nelson turned his basement into a dance studio with a full-length mirror and wood floors, so his daughters could dance and do gymnastics at home.
"I think next year they will notice there is a difference between our household and their friends," Richelle Nelson said. "They don't see it right now because they are still in elementary school."
Pictured, Emily Nelson, 10, practices her dance moves in the basement home studio on Sunday, April 10, 2016.
She said her son, Hunter, copes with their situation well and doesn't ask for much. His Bar Mitzvah, which they are still paying off, was a small affair at the firehouse.
Pictured, Hunter Nelson, 13, plays video games in the den.
A hope for reprieve
Richelle Nelson hopes some reprieve is on the way. She is a graduate student at Molloy College in Rockville Centre, working toward getting an M.S. in clinical mental health counseling. When she earns her degree, she intends to work part time in that field while keeping her full-time job as an insurance account executive.
She said she did not qualify for financial aid so she had to take out $32,000 in federal student loans this year, but she is actively looking for scholarship opportunities. Pictured, Nelson gets a visit from her daughter, Emily, as she must spend time studying on Sunday, April 10, 2016.
'You can't go up, you can't go down, you can't get help'
"Six or seven years ago, we were upper middle class. All of a sudden we're smack in the middle of middle, middle class and not able to get anywhere," Nelson said. "You can't go up, you can't go down, you can't get help."
She and her husband do count their blessings though. They are happily married, with healthy and happy children, she said. It will just be nice when things get a little bit easier.
"Maybe the additional income will make it so we're not just treading water," Nelson said. "I don't know if it's a certain dollar amount in particular -- $20-, $30-, $40,000 - I don't know what the number is. It's just a comfort level that if something should happen again, we would still be OK. I hope that's what I'm working toward."
Pictured, Nelson moves down to her basement to get more studying done on Sunday, April 10, 2016.
More photos of the Nelson family
Emily Nelson, 10, and her sister, Lauren, 12, play in front of their home in North Bellmore on Sunday, April 10, 2016.
Emily Nelson, 10, left, and her sister Lauren, 12, read a book together in a guest bedroom of their North Bellmore home on Sunday, April 10, 2016.
Michael Nelson, 46, and his daughter, Emily, 10, check prices on cold cuts for the week from the local market on Sunday, April 10, 2016. He said they have the best prices for Boar's Head cold cuts.
Emily Nelson, 10, practices her dance moves in her home studio in North Bellmore that her father Michael built for her, Sunday, April 10, 2016. The wood floor was a gift from Michael's company in Deer Park.
Richelle Nelson gets a hug from her daughter Lauren, 12, as she must spend time studying on Sunday, April 10, 2016.