Pick Your Community: | Hopkins | Muhlenberg | Daviess | Christian | Henderson | Lakes | McCracken | Webster

Dave Says – September 8, 2013

dave ramsey turq 300KENTUCKY (9/8/13) – This week Dave discusses 'Serious talk time' and 'Big car debt, small income'
 
Dear Dave,
My wife and I make together about $100,000 a year, almost $50,000 in an IRA and no debt except for our home. The problem is I’ve had several health issues lately, and we’ve diverted a lot of money we’d put into saving and investing toward medical bills. We also have two kids in high school who want to go to college. Do you think we should cash out the IRA to help send our boys to school? - Jeff

Dear Jeff,
You guys make $100,000, and expenses at a good in-state school would be roughly $17,000 a year. If I were you, I’d trim the household budget and make the kids get to work. Look around and see what you can sell, too. There’s no reason you all can’t pull together and cash flow an education for these guys.

Providing an education for your kids is a noble pursuit, but you’re low on money right now because of health problems and medical bills. You didn’t do anything wrong to create this scenario. It was just a case of life happening. So, you shouldn’t feel ashamed to sit down with your kids and say, “Okay, serious talk time. You guys know what’s happened recently, so if you want to go to college, you need find a good, affordable institution and start applying for every available scholarship. You also need to plan on working after school and on weekends—now and when you’re off at college—and saving money like crazy. Your mom and I will help out some, but we all have to pull together to make this happen.”

There’s a better way to do this than borrowing money and going into debt. There will be times when it’s not easy, but walking around with student loans hanging over your head—or nothing set aside for retirement—is no fun, either! - Dave
 
Dear Dave,
My mom has about $35,000 worth of debt from a $17,000 car and $18,000 in student loans. She makes $20,000 a year. How can she get out of this mess? - Christina

Dear Christina,
No one needs a car that’s worth nearly all of their yearly income. That’s just ridiculous. If you listen to me on the radio, I’m sure you’ve already heard me say what I’m about to say now—sell the car! That will get rid of almost half her debt, then find her a little $2,000 beater to drive until she can save up for a better car.

Remember this simple rule: Never buy a car that costs more than half of your annual income. Also, never go into debt to buy a car. Automobiles go down in value like a rock, and you never want that much money wrapped up in something that’s depreciating.

We also have an income issue here. Your mom has to do something in the short term to get her income up and pay off debt. A part-time job nights and weekends would be a really good idea. Then, she needs to address her long-term situation with an eye toward a decent job. Whether it’s more formal education or technical training in a particular field, she needs to find a career that will significantly increase her income. - Dave
 
Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 6 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.


Disclaimer: The content supplied by columnists and letters to the Editor on this site does not in any way, shape or form, implied or otherwise, necessarily express or suggest endorsement or support of any of such content, statement, or opinions therein. SurfKY News does not necessarily adhere to or endorse content provided by outside non-staff sources.

© Copyright 2014 SurfKY News Group, Inc. All rights reserved. This material may not be published, broadcast, or rewritten without permission. SurfKY News encourages you to share this story by using one of the social media links below.

In Other News...

Expanding Cancer Treatment Options Across Western Kentucky

LEXINGTON, Ky. (9/18/14) — Kentucky faces some of the highest rates of cancer incidence and mortality in the nation,… Read More

Closure on Kentucky 2678 in Henderson County Today

HENDERSON, Ky. (9/18/14) — The Kentucky Transportation Cabinet plans to close Kentucky 2678 in Henderson County today.… Read More

Most Read This Week (Site-Wide)

September 15, 2014 5583

Man Accused of Stealing Rural King…

in Top Stories by MCSO PIO Alex Piper
September 15, 2014 5227

Man Accused of Stalking Woman During Her…

in Top Stories by GPD PIO Wes Miller
September 16, 2014 4257

Postal Worker Arrested for Terroristic…

in Top Stories by GPD PIO Wes Miller
September 17, 2014 3088

Wanted Man Leads Troopers on Chase…

in Top Stories by Trooper Stu Recke
September 17, 2014 3066

Two Arrested for Meth After Traffic Stop

in Top Stories by Alex Piper

Most Read Stories from Hopkins County

September 17, 2014 3088

Wanted Man Leads Troopers on Chase…

in Top Stories by Trooper Stu Recke
September 15, 2014 2441

Man Arrested for DUI, Carrying Concealed…

in Top Stories by Madisonville Police Department
September 15, 2014 2316

Man Arrested for Being Under Influence of…

in Top Stories by Madisonville Police Department
September 17, 2014 1954

Three Injured in Two-Vehicle Accident

in Top Stories by Kyle Pharris
September 18, 2014 1675

Manitou Man Charged with DUI

in Top Stories by Madisonville Police Department

Most Read Stories from Owensboro

September 15, 2014 1713

Owensboro Convention Center Announces…

in News by Madison Strobel
September 15, 2014 1417

Marian Retreat Oct. 18-19

in News by Jennifer Kaminski
September 15, 2014 1288

Parking Committee Meeting Location Change

in News by Beth Cecil
September 15, 2014 556

Owensboro Man Charged With Burglary,…

in Top Stories by Dennis Beard, SurfKY News
September 18, 2014 480

Owensboro's Nathan Morris Has Worldwide…

in Top Stories by Paul McRee, SurfKY News

Most Read Stories from Muhlenberg County

September 15, 2014 5583

Man Accused of Stealing Rural King…

in Top Stories by MCSO PIO Alex Piper
September 15, 2014 5227

Man Accused of Stalking Woman During Her…

in Top Stories by GPD PIO Wes Miller
September 16, 2014 4257

Postal Worker Arrested for Terroristic…

in Top Stories by GPD PIO Wes Miller
September 17, 2014 3066

Two Arrested for Meth After Traffic Stop

in Top Stories by Alex Piper
September 14, 2014 2484

Three Injured in Single-Car Collision

in Top Stories by Robert LIttlepage

SurfKY News Group, Inc. Central Office & Printing Division
1125 Nebo Rd.  •  Madisonville, KY 42431  •  270.452.2249 (fax)
Main Number: 270.452.2727 (phone)  •  Printing Division Direct Line: 270.821.8600 (phone)


Contact a member of our staff: www.surfky.com/contact
Copyright © 2014 SurfKY News Group, Inc.  •  Terms of Use  •  Site Map

social 03social 04social 22social 21social 06