Chapter 1: What financial issues does Ann face with her husband's gambling problem?
Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is The Ramsey Show.
I'm Dave Ramsey, your host, Dr. John Deloney, Ramsey personality, host of The Dr. John Deloney Show, and number one bestselling author, PhD in counseling. He is my co-host today. So if you've got questions about dealing with your family during the holidays, he's here for you. And if you don't, your family's calling about you. If you don't think there's crazy in your family, that means it's you.
Because every family's got some crazy. So there it is. That's how that works. Ann is with us in Chicago. Hi, Ann. How are you? Hi, I'm doing well. How are you? Better than I deserve. What's up? Okay. So almost a month ago, I found out that my husband was gambling online and he All of our savings has pretty much been depleted, and we have quite a bit of debt. So he's used up the savings gambling?
Yeah. How much? Yes. It's a total of $120,000. Whoa! Yes. Yeah. And he borrowed money to continue? Yeah, so that's the money that we owe. How much do you owe for his gambling? That is the total. Oh, I'm sorry, $120,000? Is the debt that we owe in regards to what's been spent from savings. Oh, how much did he steal from savings?
I couldn't even tell you the total, but we're basically starting from square one. So we have found we've gotten a loan. He's gotten a loan to take care of the debt that he needs to pay back. So I guess we're kind of focusing on going to counseling and getting ourselves back into a healthier place independently before we start to kind of focus on next steps with the marriage.
But right now, I just need to... how to prioritize my funds to start replanting. Like I have an educator pension, but I know I need to save and invest in addition to that for retirement and to also like build up that emergency and savings.
So I guess I was just looking for some guidance on like how to do that while knowing I also have a daughter going off to college next year and just life expenses. So yeah. We're going to have to be real honest with you. Okay. In a short amount of time. Is that all right? Yeah, absolutely. Your college, your daughter's college plans have probably changed dramatically. Yeah.
And y'all are going to have to metabolize that and have an honest, direct conversation with her. But chances are, I'm almost guarantee you, she's not going to go to the college she thought she was going to go to because she don't have the money. Yeah. Yeah. And she's, Yeah, she's aware. She knows. Yeah.
And you're going to have to set up, at least in the short term, for the foreseeable future, you have to make sure you're safe because he's untrustworthy. Yep. And just going to counseling isn't going to solve his problem.
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Chapter 2: How much money has been lost due to gambling?
He's got to go to rehab. Yes. He's got to get with the Gamblers Anonymous. He's got a bad problem. Yeah, he's doing that. Okay. Yeah, he's been doing that for about five or, well, probably longer. probably longer than five weeks now and then seeing a therapist in addition to that. So. Okay. So number one, so your longterm,
issues are he reaches a level of healing and then over time can rebuild trust. It's not instantaneous, but over time he rebuilds trust and the two of you are handling every dollar in the household together. Yes. And before that happens, you're going to start operating just to take care of you.
Yes.
And I really don't care about your teacher's pension and your long-term investments right now. I just care more about you having an account where you're in control of food, shelter, clothing. Yeah. We kind of did that right away. I got my own checking account established. And he has... And then we have a joint one for him to have a portion of his paycheck to go into so he can cover...
the debt that he is repaying, but I still have like views of that, I guess. How do you make? What do you make? I make about $75,000 a year. What does he make? I think it's between $90,000 to $100,000 a year. In a month, our monthly income after taxes and deductions is about $9,000 a month.
I think you'd probably sit down with a marriage counselor and get some guidance on this, but I would not be opposed to all the money going into your account and him having visibility on it. And having a discussion about it, but no access to it. I'm in full agreement of that. Yeah. I think his check and your check should deposit into your account.
And then you pay the debt bill out of that account. But he's got visibility. I don't mind him knowing what's going on. But I just don't want him to have access to money. He's got an addiction. Okay. I don't even want him having access to, quote, unquote, his money to continue his addiction. You follow me? Yep, yeah. Yeah, so because his track record right now is pretty blemished. Yeah.
So you sound very factual and logical about this. I guess you're the other side of being pissed off to where you can't even breathe, right? You're detached because you have to be. It's been four weeks of, I don't know, I guess trying to be very solution-focused. Yeah, yeah. I mean, like I said, we're very much focusing on... Well, one of two things is going to occur.
Long term, one of two things is going to occur. He's going to get well and rebuild trust and never go near these sites again, never do this stuff again. Or you all probably aren't going to be married. Yeah.
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Chapter 3: What steps are being taken to address the gambling addiction?
And what I mean by that is for the next 30 days, here's what you can do to reestablish trust. And then he gets to decide, do I want to be a part of this marriage or not? But for 60 days, all of this money goes into one account. Yeah. And you can sit by me, but you don't have access to it. I don't mind you seeing everything and even let's talk about what we're going to do with it. That's all fine.
You speak into it, but you don't have access to any money. And your name's off of everything. Yeah, absolutely. And then he gets to choose, do I want to stay into this marriage? Yeah. But you get to decide, here's what reestablishing trust is going to look like for the next 60 days. And then the next 60 days after that, and the next 60 days after that. Pick up Henry Cloud's book called Trust.
Yeah, it's got some real good frameworks in it on this to have a good discussion about as well. But yeah, let's first establish a short term game plan that's solid and you're protected and safe. Then you worry about retirement.
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This may seem small, but it's something that, yes, I appreciate your help with. I have a federal student loan that I thought had been discharged, and 30-some years later it pops up again. with some interest smacked on it. It's not a huge amount. It was with that added $14,000 loan with $17,000 interest. I find out about it. I'm like, wow, okay, what do I do? Start thinking about that.
Why did you think it had been discharged? Well, I had a very bad marriage and I was told by, as part of a bankruptcy settlement by probably a second rate lawyer that that that had been taken care of. Another loan had been discharged, and I just... Is this a federally insured student loan or a private student loan? A federal, yeah. And now I know that they're with me until you die.
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Chapter 4: What financial advice is given for managing debt and savings?
a debtor like a car you take out a bad car debt you don't pay it they sell that loan to a collection agency for a discount and then the collection agency whatever they can get from you that's what that's how what's they make the spread the only way this would work and revert back is if the federal government is not selling the loan but they're hiring basically a henchman to go get the money
No, no. Sometimes the see is a federally insured student loan. So sometimes the the lender or the owner of the debt gives up and looks at the federal government and says, pay me. You have a guarantee on this. OK. And so then the Department of Education buys the loan at full value. OK. And so they get their money because they have a guarantee on it.
The lender gets their money, and now the loan actually becomes the property of the federal government. Okay. Because they're buying it out. Same thing happens with like an FHA home that gets foreclosed on. Okay. The Federal Housing Administration has guaranteed the loan. So Citibank forecloses on an FHA loan. HUD, Department of Housing and Urban Development, writes Citibank a check for 100%.
Of that loan. Of that loan, regardless of what the house is worth. Okay. And then they take the house and sell it for whatever they can get. And so you've got a HUD foreclosure up for sale that the government owns the house because they had to make good on their guarantee with Citibank. And this works exactly the same way as that.
So when we think of, at the macro level, you know, the debt, the U.S. debt. None of that's included. None of that's included? No. Like the liabilities that the government has guaranteed, none of that's wound into that number? That's not in that number. Okay. Now that number is simply money that Treasury bills, Treasury bonds that are issued, which is borrowed money. Okay.
And people buy that and they use that money to fund the amount that they're in the hole called the deficit. Okay. Finally, mortgage rates have dropped, and you know what that means. People who have been sitting on the sidelines are about to jump back in to the housing market. So if you've been waiting to buy, this could be your window, but you've got to be prepared and do it the Ramsey way.
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Chapter 5: What financial challenges are discussed regarding a personal injury settlement?
He's still under doctor's care, workman's comp, but he's getting ready to lose the workman's comp. And he's got a couple checks left coming that we do know of before they cut him off. But I don't know if I need to use that money to pay off what I can. Okay, so he's unable to be a coal miner because of the injury. Yes.
And how is it that they're getting away with not paying him for the rest of his life for that? Well... That is something that we are going to push for, but in the time being, I mean, he won't get anything until we fight it, if that makes sense. Yeah, well, I mean, it's been a year and some change. Why are we not yet fighting it? Because our...
legal advisor told us that we needed to wait until he was completely done with all doctors cared. That way he can continue to get the care that he needs for his hand. And then after it's over being, there's no union contract that covers any of these, these injuries. No. I would, is this is unionized though, isn't it? Um, I'm not sure. He's not in a union. No, no, that's, Interesting. Okay.
All right. So, yeah, well, I mean, your attorney is, you have faith in your attorney that this is good advice and you're going to be ready to go. Because I suspect this is something, I mean, he was hurt on the job permanently. I think they're probably going to have to support him. But, you know, but you're right in the meantime. Okay. So what's the status of his injury now?
How's he doing in general? Okay.
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Chapter 6: How can someone manage a significant personal injury settlement?
Okay. He's unable to use his hand. They had to amputate his thumb. They degloved him from his palm all the way up his forearm. Oh, God. Tendon ligament repair. They had to take muscle out of his hand. It has been a terrible. Yeah, obviously. Oh, my gosh. I'm so sorry. The Lord has helped us, though.
I'm telling you, if it was not for the Lord, there's no way that we could have been where we are today. So what I'm thinking about, how old is he? He's 35. Okay. This is an absolute tragedy, and it's absolutely horrible. I'm so sorry. And if I'm him, I've got the rest of my life, I've got to figure out what I'm going to do. Yes. And nothing is not an option. Right.
So lots of people have sadly gone through losing a limb or losing the use of something and have managed to find productive work of some kind, maybe using your mind instead of your body or maybe using prosthetics to get a different kind of a job done.
But I really want him to be thinking about, other than sitting around waiting on the lawyer to call him, I want him to think about what his next career is. Yes, he has been doing that. So what's the plan? Well, he really likes to detail vehicles. He's always liked to do that. And that is something that he would like to do. What did he used to make as a miner?
Chapter 7: What are the implications of carrying debt while preparing for retirement?
um cost to um 100 grand a year almost okay and so let's start talking about detailing a detailing business car detailing business that makes 100 grand right it could be done that's that's doable and it might be it might be as five kids doing has five crews doing car dealing and car detailing and he owns a business not just as doing it himself
I mean, I don't know, but let's start looking for a path where we don't start with the assumption of we lost 80% of our income for the rest of our lives. No, no. How about we lost none of our income and we get the benefit of this lawsuit? Yes. So, I mean, as soon as he is physically able with somebody to hire somebody to help him, And then the two of them can do a car detailing.
He needs to get started detailing cars now. Yeah. Yeah. Merry Christmas. You've got a pressure washer for Christmas. He already has tons of that stuff. All right. Well, let's get our button gear. Let's get our button gear. And then we don't have to sit and try to solve for an 80% cut in pay.
We're going to have some cut in pay, and you've been through this horrible tragedy, and all of that's real. But let's minimize the damage that it does by getting back to work sooner than later. Is that okay? Yes. As soon as—I guess as soon as he's able to. I mean—
Yeah, and I don't know the medical condition, and I can't even imagine that because basically if I have a hangnail, I end up in intensive care. I'm a complete wuss. So I can't even imagine what he has gone through, and I would not ever dare to even begin to understand the pain or the loss or the – emotional scars that go with this whole tragedy.
But I can't even get there because I'm a complete wuss. I mean, really, it's ridiculous how big a wuss I am. So anyway, still, though, if I'm him, I'm going to go back to work.
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Chapter 8: How can someone effectively transition from a high-income job to a different career path?
Yes. I mean, he wants to do that, but as of now, I mean, he can't even lift over 15 pounds. I have to help him do everything. Was his back hurt? No, it's the end. He can't lift anything with that hand, but the other hand he can lift on more than 15 pounds. Yes, yes. But I help him do a lot because of the hand injury. And he does as much as he can. I mean, and he's a go getter.
He's always worked 60 plus hours a week. I'm assuming I'm not accusing the guy being lazy and please not even close. But I'm assuming you're doing a lot of physical therapy as well, right? Yes, he has done it over and over. Yeah, I bet. I'm so sorry. Even if he has to go work a register somewhere just for the time being, there's the physical ailment here, but he lost his identity.
Coal miners have a... An ethos. Yeah, they've got a spirit about them. They're tougher than the rest of the people. They do work that nobody will do. There's a spirit, and that's been taken from him.
And so even just grinding out a shift at a gas station, sitting on a stool, like checking people out with their waters and their snuff cans, he'll at least start to slowly get back a little bit of that I'm providing. You get what I'm saying? Right. And right now he's okay. Jim, I'm okay with it because he is John workers, but he's still constantly like, I need to do something. I need to go.
He's right. He's right. But hear him say that's a spiritual thing. I'm serious. Hire, hire a college student that's home for the holidays to go out and help him and get his, let's get this detail business started. Good idea. You know, and somebody go be with him and the two of them together get it done, and he can manage the customers and manage the money and do some of the work.
Some of the stuff is doable, I suppose. I don't know. I mean, I'm just reading into this. But all of this to say, let's not start with the premise we're going to lose 80% of our income. Let's start with the premise that we're going to lose 80% of our income for a month. But to go back to your original question, we're not going to take all the remaining cash we have and try to pay off everything.
We're going to pay minimums and stack cash, right? No, you stack cash. You're in the middle of a hurricane, so you just stack up cash. You're in the middle of what's called an emergency. Right. So you don't use anything.
You pile money up, you pay minimum payments, and then let's get this situation stabilized with his income coming back up with some kind of a business or some kind of a thing he can do. And by this time next year, he should be back up. He's cooking. And then you can start talking about using that money to pay down debt and push play again on the total money makeover baby steps.
Everywhere you turn this time of year someone's telling you to swipe a card now and pay later. But that mindset always leads straight to debt and post-holiday stress. Fairwinds Credit Union takes a different approach. They're here to help you win with money. Fairwinds doesn't push credit cards. They help you build savings and stay debt-free, just like we teach, with the baby steps.
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