Facing a $90K Debt Crisis: Expert Warns of Consequences Unless Key Changes Are Made
According to The Sun, A woman has reached out for guidance after her partner’s struggling business has plunged them into significant debt, urging experts to recommend a crucial change to improve their financial situation.
The Financial Burden
Rachel, a stay-at-home mother from Oregon, explained during a recent episode of The Dave Ramsey Show that her partner’s failing venture has set them back tens of thousands of dollars across personal and corporate credit cards. The couple faces over $90,000 in combined debt, including liabilities from both personal and business credit cards, along with the financial strain of a truck and trailer.
In addition to this debt, Rachel and her husband own a home valued at around $250,000, with a mortgage of approximately $175,000, leaving them with a potential profit of $75,000 if they decide to sell.
Weighing Options
During the call, Rachel sought advice on whether they should sell their home and move to a smaller place or hold onto it. She described their dire financial situation, revealing that she is a stay-at-home mom to three children, with a fourth on the way. The couple’s finances have become so strained that she noted, “We’ve got about $25 in our checking account.”
Exploring Employment Opportunities
Dave Ramsey inquired about her husband’s employment prospects. Rachel shared that he might be able to find work as an electrician’s apprentice but expressed concern that job opportunities in Eugene, Oregon, are limited. She estimated that her husband would be lucky to earn $30 per hour despite his construction background.
Urging Immediate Action
Both Ramsey and expert John Deloney emphasized the need for her husband to take immediate action, suggesting he should accept any job available to help alleviate their financial burden. They recommended that he pursue construction work with multiple crews or consider night shifts at local stores. “Not doing anything is not an option,” Ramsey asserted.
” I can’t fathom the situation you’re in right now.”
Dr. John Delony,
“He has to go get three jobs this week.”
To further enhance their income, Ramsey suggested selling the trailer her husband had recently purchased for the business.
Survival Mode Strategy
The experts advised Rachel and her husband to adopt a “full survival mode” approach, focusing on generating as much income as possible quickly. Ramsey emphasized, “The only answer to it is extreme activity on his part,” noting that while her husband’s business had failed, it doesn’t define his capabilities.
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Prioritizing Expenses
As they work to stabilize their finances, Ramsey outlined a priority spending order for the couple’s first income: food, utilities, mortgage, and then truck payments. He assured Rachel that selling their home wasn’t necessary, as their financial struggles stem primarily from low income rather than excessive expenses.
Support for the Future
To further assist the couple, Ramsey offered the support of a free financial coach from The Dave Ramsey Show to help them stay on track and overcome their financial challenges.
Dave Ramsey frequently tackles complex financial scenarios on his show, recently advising another couple burdened by $20,000 in credit card debt to address their housing situation as a priority. Another caller, a father of five with $46,000 in credit card debt, was also advised to correct a habit that was undermining his financial stability.
