Jun 11, 2024
Life is expensive, and marriage and family can make things even less affordable — at least, that’s what happened to Abdel from Fort Worth, Texas.
The 28-year-old newlywed called into an episode of The Ramsey Show for advice on how to manage multiple debts.
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He explained to finance guru Dave Ramsey how his money situation has gotten out of control: an expensive wedding, coupled with the cost of raising a baby, all while living on a single income has resulted in a mountain of debt — specifically credit card debt.
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Abdel isn’t alone in his predicament. He’s one of millions of Americans who are drowning in credit card debt. To put this into perspective, total U.S. credit card balances were roughly $1.12 trillion as of Q1 2024, according to the Federal Reserve Bank of New York.
Ramsey had some rather harsh words of wisdom, as he told Abdel he has to “work your brains out” to recoup his financial losses.
Big expenses
Before Abdel got married, he had zero debt — other than his student loan — and had $20,000 shored up in savings.
However, he claimed that “stupid mistakes” post-marriage led him to the difficult financial situation he finds himself in today.
Right off the bat, he admitted the wedding cost him about $30,000, which was money he didn’t have in the first place. To add fuel to the financial fire, he was obligated by his culture to buy gold for his wife when they got married.
The gold cost him $10,000, and he needed to take out a loan to pay for it. “I’m sorry, did you say gold?” Ramsey asked.
Today, Abdel has approximately $20,525 in credit card debt, $22,000 in student loans, and a deferred auto loan of $20,211 (for a car he admitted he couldn’t afford). These three debts combined are roughly equal to his annual income of $63,000 working in the finance department for a non-profit refugee organization.
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Abdel and his wife have a seven-month-old son together. She’s originally from another country and only has a high school education, so she’s a stay-at-home mom and doesn’t earn any income.
Saddled with debt, Abdel is paying a whopping $1,500 to $2,000 a month in credit card payments. However, his monthly payments aren’t “going anywhere” thanks to high interest rates. He’s even wondering if he should let his credit card debt go to collections.
Ramsey’s advice? Abdel needs to learn how and when to “say no” when he can’t afford something.
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Be realistic about how much you can spend
It’s not too late for Abdel to get his finances in order — it’ll just require a lot of discipline and a rigid, yet realistic, monthly budget.
“What I’m hearing is… you really struggle with saying ‘no’, to anyone,” Ramsey observed. “You’re going to have to practice that word: no.”
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In addition to getting tougher on his finances, Ramsey believes that Abdel’s wife will have to get creative and find ways to bring in some type of income, even if it’s only part-time.
“She needs to do something to create some income even if it’s while the baby is napping,” Ramsey said. There are many side hustles that can be done remotely from the comfort of your own home, including freelance work, customer service or selling clothing, furniture or handmade crafts online.
Ramsey’s final advice to Abdel was that he should take on a second job and “work your brains out.”
Bringing in more income, cutting back on dining out, limiting vacations, and turning in the car he can’t afford for a cheaper model, are all crucial steps to his family’s financial recovery.
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Adam Palasciano is a freelance contributor to Moneywise.
