During an episode of The Dave Ramsey Show, a concerned caller asked a personal finance expert: Dave Ramsey What to do after realizing your financial situation is unsustainable? Ramsay’s advice:
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Calling from San Diego, Olivia told Ramsey that her financial situation was unsustainable and asked if she, her husband, and their two children should leave everything — their church, their family — and move to a cheaper home to build their fortunes. Olivia explained to Ramsey that they had just paid off their debt. Before offering any advice, Ramsey asked the caller to reveal how much she and her husband made.
Olivia told Ramsey, “My husband made $70,000 last year, and I work on his days off,” adding, “I made $30,000 last year.” This puts her income in San Diego at $100,000, but the caller said he wants to move to Arizona. According to information from Salary.com, the cost of living in San Diego, California is at least 39.7% higher than Phoenix, Arizona. The median home price in San Diego is 101% higher than Phoenix, Arizona. However, Azcentral reports that even in Tucson, the city with the lowest cost of living in Arizona, a family of four needs to earn $215,000 a year to live comfortably. Therefore, moving to Arizona will not provide financial stability and may increase stress, as relocation is considered one of the most stressful events in life.
Ramsay “The way you ask the question, the way you structure your sentences, you don’t want to quit,” Olivia told the caller. The caller acknowledged that she didn’t want to quit and said the only reason she wanted to quit was for financial reasons. Olivia explained that she works hard to send her daughter to a private Christian school, but was only able to do so because of the support of her family.
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Ramsay sympathized with Olivia and agreed that “it’s tough to move away from your grandparents,” but added that Olivia would have to make some decisions. He explained, “Either change your career so you can keep this up or make other choices, like not going to private school.” Something would have to change, Ramsay explained, because their financial situation was not sustainable. Olivia and her family would have to make some difficult choices. Ramsay praised Olivia for realizing that their financial calculations were not working, saying, “That’s very smart of you to realize that the calculations were not working.”
In Ramsay’s view, Olivia has three options: pull her daughter out of private school, change jobs, or move to an entirely new state. Ramsay advised Olivia, “One of three options. All three are hard. Pick the hard option, because if you don’t, the hard option will pick you.” Olivia and her family have some decisions to make before they are forced to make the hard ones. Ramsay also advised Olivia and viewers that it’s important to have some kind of life insurance in place to cover any unexpected events that may occur.
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This article Dave Ramsey advises women who realize their financial situation is unsustainable: “Choose the pain, or the pain chooses you.” Originally Benzinga
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