Struggling with $90K Debt: Expert Advice for Couples Facing Financial Breakdown
According to The Sun, A woman has been advised to make significant changes after her partner’s struggling business led them into a serious financial predicament. The couple is facing tens of thousands of dollars in debt, accrued across personal and corporate credit cards.
The Debt Situation
During a recent episode of The Dave Ramsey Show, Oregon resident Rachel reached out to experts Dave Ramsey and John Deloney for advice on her dire circumstances. She shared that her partner’s failing venture has resulted in over $90,000 in debt, which includes obligations from both personal and business credit cards.
Additionally, Rachel mentioned that the couple owns their home, which has an outstanding mortgage of around $175,000. However, she discovered that the property’s value is closer to $250,000, providing a potential profit of around $75,000 if they decide to sell.
Desperate Times Call for Immediate Action
Seeking guidance, Rachel asked if she should sell their home and move into a smaller place or hold onto it. Dave quickly inquired about her annual income, learning that Rachel is a stay-at-home mother to three children and is expecting a fourth. She expressed concern about their financial situation, noting that buying food and keeping the lights on had become increasingly difficult, stating, “We’ve got about $25 in our checking account.”
Exploring Employment Options
With a grim outlook, Dave questioned why Rachel’s husband couldn’t secure a higher-paying job given his skills. Rachel explained that opportunities in Eugene, Oregon, were limited, with her husband likely earning around $30 per hour as an electrician’s apprentice.
Urgent Recommendations
In light of their financial crisis, Dave and John urged Rachel’s husband to make a crucial change by taking on any job available. They recommended that he work construction jobs with multiple crews or even consider night shifts at the local Walmart to generate income. “Not doing anything is not an option,” Dave asserted.
I can’t fathom the situation you’re in right now.
Dr. John Delony,
“He has to go get three jobs this week.”
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Alongside finding extra work, Dave suggested selling the trailer that Rachel’s husband had purchased for his business to free up additional cash.
A Survival Strategy
The experts advised Rachel and her husband to enter “full survival mode,” focusing on maximizing income quickly. “The only answer to it is extreme activity on his part,” Dave emphasized, noting that while her husband is a good person, the failure of his business had left them in a precarious position.
Spending Priorities
Dave outlined a spending strategy for the couple’s first paycheck from the new jobs, recommending they prioritize expenses in the following order: food, utilities, mortgage, and then the truck payment. He assured Rachel that selling their home was not necessary, as their primary issue stemmed from low income rather than high expenses.
Additional Support
To further assist them, Dave offered the couple access to a free financial coach through The Dave Ramsey Show, ensuring they would have guidance to navigate their financial challenges effectively. He highlighted that he has advised many individuals facing tough financial situations, including a couple with $20,000 in credit card debt and a father of five burdened by $46,000 in credit card debt, encouraging them to rectify their spending habits.
