Chapter 1: What is discussed at the start of this section?
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Ann is with us in West Palm Beach, Florida. Hi, Ann. How are you? Hello. I'm well, thank you. How are you? Better than I deserve. What's up? Okay, so I'm calling in today because I've been in a financially abusive marriage for the last 23 years. I am facing prison time. I'm actually supposed to be checking into prison on the beginning of June. We have four children. They're all amazing, smart.
I stayed at home with them for the last 20 years. I'm going to prison for, it's called a conspiracy to commit bank fraud. During COVID, my husband put my name down on documents. showing that I was the owner of a couple of companies. He gave me different people to put down on these companies, and so that's what happened. I'm sorry, you knew this was happening when it was happening, though?
No, no, I didn't know that it was... How are you being held accountable for someone fraudulently using your name? I'm confused. That's a good question. I mean... That's a good question. We had federal agents come to the house and ask questions like, is this your signature? And I said, yes. Like I said, I've been a stay-at-home mom for so long. I know we have back taxes due. I've signed those.
I've never had my name on an account before. Um, anytime my husband would put my name on a bank account, it would be closed due to like overdrawn funds. Um, so I've, I've been in a position that any money was his money. I never had a say in anything we did with the money. He had a bad gambling problem. Um, So, I mean, yeah, that's... Let me... Can I push back on this?
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Chapter 2: How does financial abuse impact recovery?
Because this is a big thing to drop on us here. You've already been convicted, and so that means the government went through trial and proved to a jury that you did, in fact, participate in this. And so when Dave asked you the question... No? No, we didn't go to trial. My attorney told me that... Who has not been paid. My attorney told me that...
I would probably not win at a trial because... So you pleaded? Yes, I pleaded. Yes. Yeah. So how long are you supposed to be incarcerated? Three years. Um, so... So they let him go in first. Oh, so he's already in prison. He was in, now he's out. Out of three years, he did one year. Um... During that time, I had gotten a job. I have a graduate degree I got before I started having children.
How old are your children now? 22, 18, 17, and 12. Okay. So I'm afraid to ask, but apparently he's taking care of them. Yeah, yeah. Okay. Are you divorced yet? No, he won't give me a divorce.
Chapter 3: What should I do if facing prison time due to my spouse's actions?
He doesn't get the option of giving you a divorce. You live in Florida. You can file for divorce and it will be granted. He takes my keys if I try to leave. He's let the air out of my tires. I don't care. Obviously, you can't stay married to this guy. Obviously. I just don't have anywhere to go. Well, you're going somewhere in three months, so that's not an issue.
We already know where you're going. But in the meantime, you need to get an attorney and get divorced. That's my plan is the second I set foot in that prison that I'm filing for divorce. Okay. Yeah, absolutely. You know, have somewhere to go after, and I'll have a better plan. Yeah. Good. You get to start over fresh after living in an abusive, horrible situation for way too long. Right? Right.
Okay. Yeah, so... I know I have like a 401k. Do I need to do anything with that before I go away? You can sit down with a SmartVestor Pro and roll it into an IRA because you're probably not going back to that job, I suspect, right? I don't know, possibly. I'm kind of betting on that, yeah. So what were you doing? What was your career for the last three years? I did epidemiology for a clinic.
You did everything for what? For a clinic? Epidemiology, track diseases. Okay. So that's what your graduate work is in? Yeah. Okay. All right. So you think you can land that when you come out? Probably not. No. I've so much resentment toward my husband. I'm probably never going to be able to do anything I'm sorry, why would you not be able to land that again?
Your husband hasn't got anything to do with this. You're not your husband anymore at the end of the story, and you are starting fresh the other side of a jail term. Why could you not go back to this career? I think because I have a felony. I don't believe that I am very marketable. Well, let me jump in here to try to encourage you. You have three months to tie up some loose ends, obviously.
And one of the most important is to get your story out there either to your existing company. They probably already know this. But this is a situation where you have to try with everything you have. To get out the correct narrative and look people in the eye. And some people are going to say things to you because they don't like tough conversations.
Some people don't even want to consider anything. But I would be trying to shore up what reentry would look like. Because if your husband got out in a year, hopefully you're going to get out sooner than him. You're not in a situation where you're handling money in any way. So it's a medical situation. So having a felony is not necessarily going to keep you from landing a job.
Especially if you tell them when you go in for an interview. When you do the research, when you do the background check, you're going to find a felony. I'm out. I'm clean. I'm innocent. Here's what happened. Give me the thumbnail sketch version of that, not with a bunch of shame and not with a bunch of drama, but just a little bit of information for the person doing the interview.
And if you don't need to call me back, you can go ahead and let me know now. Or if you want to give me a shot, I'll be the best employee you ever had. I think you'll land something when you get out and you start your life again, kiddo. This time without the baggage of an abuser hanging around your neck. The year he was away was the best year of my life. Yeah. Welcome to the rest of your life.
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Chapter 4: How can I navigate divorce while dealing with financial issues?
And diving back into studies is never a good thing when you haven't been able to find a job. So, yeah, you need to get your big girl life up and running. And the best place you could do that in your situation is in proximity of a counseling organization, especially if they have some kind of tuition reimbursement program. And I'm not kidding.
If you can sweep their floors, that's what I would do rather than sell insurance. It's absolutely right. Selling insurance absolutely has nothing to do with anything. That's right. Except you just took a job, and they were the only ones that would hire you this week. And so you took a job, and they're not even going to pay you.
They're putting you on a straight commission to try to get your mother to buy insurance, and then they're going to fire you. So because you're not going to make any sales. And so that's just, yeah, this is not tracking out. Yeah. So hang on. We're going to send you a copy of the book Proximity Principle that Ken wrote.
And Ken, talk about that for a minute, the whole thesis behind that book, because it's helpful to a lot of people. Yeah. The Proximity Principle says in order to do what I want to do, fill in the blank there. I've got to be around people that are doing it and in places where it is happening. So the real formula is the right people plus the right places equals opportunities.
And so this is a really empowering thought when you figure out that it's actually not a deep thought. It's just the old phrase. It's not what you know, it's who you know. We all know that's true. That sticks because we all get that. Not in some kind of slimy way, but it's just the way a door gets opened if you knew somebody. That's it.
Well, you told me, this is one of my all-time favorites, is if you ever walk by a fence post and see a turtle on top of it, you know it didn't get there by itself. And all of us get opportunities through connections and relationships. And so the proximity principle is a step further to say, okay, if I want to be a project manager,
then the first thing I need to do is in my immediate circle, do I know anybody that's a project manager in real life? And if it's not in my immediate circle, does my immediate circle know somebody? And now we're going to go to coffee or lunch and we're going to just simply do a book report on them. How did they get where they are now? What are the good parts of their day?
What are the bad parts of their day? How much money do they make? What does the ceiling look like in that industry? You get to know everything about it. And in learning all of that, two things happen. Number one, you validate. This is called clarify and verify. You clarify what's involved in the role and the journey to the role, and then there's something inside that tuning fork will go off.
That's confirmation. That's verify that I want to do this. The second thing is that you now... are taking the posture of a student, Dave, and you're learning and people appreciate that. And then you say, hey, I would appreciate any other connections or relationships you'd be willing to put me in touch with. And that's where now these things begin to stack.
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Chapter 5: What financial strategies can help me become debt-free?
True. Which one do you want more? I'm staying in there for another year. Pay off that car in two months, and what was the other debt? Student loans. How much do you have in student loans? 50 – $55,000. Awesome. So you could be like debt-free completely in like 15 or 16 months if you stayed another year in that situation. You pay off the car and the student loans.
And then the interest rate really doesn't matter. Yeah, that's true. Live on nothing, beans and rice, rice and beans. Don't go out to eat.
Chapter 6: How can I manage multiple debts effectively?
Don't see the inside of a restaurant unless you're working there. Don't go on vacation. Work all the time. Live for one thing for 14 months, and that is to take all 100% of your raise and put it on those debts, and you'll be debt-free in 14 months. Yeah, okay. That math works. It works a lot better than trying to refinance your way out of debt, which doesn't work. Right, right.
What's the interest rate on your federal student loans? Like about 2%. Well, refinancing is not going to be a good idea because you're going to get a current rate, which is going to be a lot more. Well, yeah, I kind of just wanted to get a consolidation. I know. If you consolidate it, it raises the rate because you're refinancing. There is no consolidation on federal student loans.
Chapter 7: What are the benefits of refinancing student loans?
There's only refinancing. You get to do that one time, and you do it at prevailing rates. And in your case, it's going to increase the rates. Okay. The fact that you have four student loans or eight student loans versus one that total up to 55 does not change that we just need to pay off 55. Okay. Okay. And you've got a great interest rate on that. So, yeah, let's just leave that alone.
How many different loans are there? Unfortunately, there's like 13. Perfect. No, that's really good. I like that. Okay. And the car interest rate's like crazy, right? It's 23%. Oh, my gosh. All right.
So what we normally teach is to list your debts smallest to largest, pay minimum payments on everything but the little one, and that would be listing your 13 student loans out, and then probably your car is going to be your largest debt, and that would make it last.
Chapter 8: How can I prepare for a financial emergency?
I'm probably going to flip that in this case. I'm probably just going to knock that because I want you to knock that. If you're going to knock the car out in two months, let's just put it first. And then list your 13 smallest to largest. What's your smallest one? Yeah, I did that, actually. I use your EveryDollar app, so I actually listed them all in that. My smallest one is like $1,000.
Yeah, so see, that's going to be gone. Right. It's like a mosquito. Mm-hmm. Swat it. And then what's the next one? It is... like $1,500. Oh, good. Yeah, my largest one I think is like $9,000. Yeah, okay. Can you knock that car out in two months if you do nothing but the car? $4,000 a month. Yes. Okay. If you can do that, then let's do that. And then let's list these others.
And you're going to get so much emotional momentum, A, getting rid of the 23%, and then B, knocking off 1,000, 1,500. And they're just going to start. And all of a sudden, you're going to look up, and you're going to have like three left. I bet you by, I mean, I don't know the exact numbers here, but I'm going to give you an estimate. I would say by November, you're going to have three left.
And that's going to make you feel like you're large and in charge because you are. Your confidence is going to go up. And that's my only debt. I don't have credit cards. I don't have anything else. That's my only debt. What is your car payment? It's $318 a month. All right, $318 a month. And then how much are you saving by staying with that roommate and not going out on your own? $1,000 a month.
Yeah, so that decision alone pays off the first two student loans that month. That's right. Yes. Yeah, true. That's why we went there so fast, because we've ridden this truck before. Okay. And the thing I wanted you to do is what I did. When I was cleaning up my mess many, many, many, many moons ago, I kept looking at... something stupid I had done or a situation I'd put myself in.
And I used it not as shame or guilt, but as motivation. It pissed me off. I got mad. And I want you to look at that 23%, that time that you got yourself in a pinch and you got screwed on a car and you let it happen. And I want you to get mad at that. So mad that 14 months from now, your friends are going to think you joined a cult because all you do is get out of debt. Yes. The Ramsey cult.
I love it. Yeah, and I want you to win. Because here's the thing, that's only a year and some change, and your whole life is going to be different after that. Because you're resetting all these grooves in your brain. All the neuroplasticity is resetting. And so you're never going to be the same again.
It's not only the fact that you get out of debt, it's who you become during this 14 months that's different than the you version that bought the 23% car. And that person's dead and gone. And now there's a new version of you that's going forward. And I'm so proud of you. And we're going to help you. You're on the EveryDollar app. We'll send you a copy of Total Money Makeover.
And you call us back if you get tired and you get down. We'll jack you up and pump you up again because I think you got the stuff, kiddo. I think you're going to knock this thing out. If you're willing to do some sacrificial things like this for a short period of time, you can set the rest of your life on a positive course. Yeah, there's no question.
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