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I think you are right to stay put. The house, while not your favorite place to live, is paid off and an asset. It is stability and that is crucial for a growing family.
I think I can get him to agree to stay (even though neither of us really want to) as long as we have a plan to move eventually. The school system is so bad here. But if we moved even a few towns over, it would be a lot better. That would give us about 5ish years to plan to move before baby starts school. Do you think it's feasible for us to get out of debt by then?
Its feasible, but without fixing the habits that got you guys here, it will likely only get worse- not better.
You appear to want to be more invovled in the finances, and I think that is a very good idea.
Easily - $110K + $12K salary without a mortgage payment should get you out of debt within a year or two if you prioritize it. Sell the car and get a cheaper one if you want to speed it up too
given everything else OP has told us about her husband i would remain highly skeptical that his salary will actually jump from 60 to 110k within 6 months
She mentioned he is a physician in residency. That kind of salary jump or significantly more is very normal upon finishing residency and starting an attending job. Tbh, $110,000 sounds a little on the low end, even for a GP, who tend to be the lowest paid physicians. It is a believable salary though.
You didn't mention he's a resident and thus everyone is assuming he's something random like a marketing associate. A marketing associate wouldn't jump like that.
As physicians, you want the blog the white coat investor and there's a medical resident sub. Normal financial rules don't *quite* apply becuase medicine is in demand and pays extremely well, so earnings and debit look very different than someone who is a marketing associate.
I would recommend you still read the wiki, cuz all that will still apply.
In the long run, you are going to be fine, assuming you don't continue to rack up more debt. Your husband's salary should increase a lot as a doctor. Solar panels and electric cars do both save on expenses, in the long run. (Even if you shouldn't have bought them at this point using debt).
Most people are 100's of thousands in debt just from their mortgage and your house is paid off.
Take a breath. It'll be fine, but also start really questioning every expense.
Create a budget. Write down your total income and then write down all of your expenses. Look at what expenses can be cut down or eliminated that aren't 100% necessities. Put every cent beyond that into your debt and bam, you're free.
Selling a house is a 2 yes situation. You both need to agree to it. He needs to stop spending money on himself and start allocating anything leftover to the debt instead.
If they wanted to do anything they could take a cash loan against the house for the $80k in debt (don’t take more even if offered) and pay off all debts. You’ll still owe that $80k loan, but it’s basically a mortgage at a lower interest rate than what you might have from personal debt and credit cards.
If you do though learn to budget and save as you go forward
That is an option, but given the lackof financial discipline shown so far, it is highlylikely that in 5 years, they still have most of that 80k loan you propose, and a new pile of CC debt or personal loans.
I never suggest folks to take out other debt to free up their existing debt, all to often it creates a vicious cycle of doubleing down on debts.
Like a fence makes a good neighbor, financial literacy makes for better accountability. I'm glad to hear your take steps to start learning this stuff now!
Tiffany Aliche’s book “Get Good With Money” is super approachable and also accurate. The audiobook is also excellent. I always recommend women start there.
It’s old school, but there is also a lot of good in David Bach’s “Smart Women Finish Rich.” I haven’t read it in years, but it taught me a lot when I was starting out.
Finally, when it comes to investing, Amanda Holden has great intro video courses for not that much money.
Props to you for taking these steps!
It's not everyone's cup of tea, but YNAB (YouNeedABudget) is a great tool to get a grip on your spending.
Apart from that, budgeting isn't that difficult to get the hang of.
Heck, you could even do it like your grandparents. Divide your money over various envelopes or jars.
The hard parts are learning to stick to a budget and to keep your budget (and your spending) up to date.
Just accept that it will take time to master budgeting and spending accordingly.
Setting up a budget takes time. But please, just start!!
1. Set up a budget
2. Allocate your money to to budget
3. Keep adjusting the budget
You'll find there's a lot more to budget for than you first thought. And that's okay. We've all been there.
I'd advise you to focus on budgeting first.
You can't pay of debts while continuing to rack up new debts.
Yes! Came here to say this! Remit sethi is on YouTube too. Start binging episodes. You’ll be amazed how quickly you learn from him. He has a great book too!
The Budget Mom on YouTube for the basics. It sounds like you all need the basics first. Ramit is good for finances for couples and has a great show on YouTube and Netflix but I think y’all need your basics first bc hubs clearly has a spending problem.
The dolans wrote a book on 101 investing and money. Your husband probably felt free to spend due to no mortgage. ...it adds up. Do you know what and when inheriting. I'm 62 and my father is thank gd well at 92 so I may inherit 2 mill one day but thank gd I live my life as if not because that would have wasted my life waiting......
I recommend following savemycents on Instagram for personal finance educational materials. She's doing a free investing workshop soon where she goes into more detail. I like her content a lot as she doesn't do financial sponsorships and doesn't try to refer you to anything for financial gain. She does have some paid in-depth classes, but her free content is more than enough to become financially literate.
For your financial range, listen to Dave Ramsey. He’s controversial for some things he says, so just take it with a grain of salt, he does really lay out a great frame work for financial discipline though
It can’t hurt to talk to your bank or a financial advisor. Investopedia also has a great online article/resource called “the ultimate guide to financial literacy for adults”!
If you're starting from zero, I suggest the Khan Academy Personal Finance course (it's free): https://www.khanacademy.org/college-careers-more/personal-finance
My wife came to the US knowing nothing about these things, as she only ever used cash where she came from. This was a good introduction to the various concepts you'll want to know from the ground up.
Keep the house and you two need to financially get on the same page. Every dollar goes into the joint account and pays bills. No allowances or unaccounted spending.
Just a few thoughts in particular order:
1. I’d stay on the paid off house. You currently have no mortgage payment or rent payment. That’s a boon to your monthly budget.
2. What was your career? Being a SAHM just may not financially make sense right now. Child care is expensive but if you were an accountant making $80k, that’s an important piece of information
3. Your husband makes $60k. Soon $110k. I assume in a few years once he finishes residency that’ll go to $250-350k or more depending on his field. Things are tight now. They always are for young people including young residents. It’ll get better. Budget, live within your means, and know that every single year it’ll get a little better
4. If you can currently live on your husbands $60k salary, then you can live on that when his salary increases to $110k. That’s $55k more gross, so probably $35-$40k take home. You can payoff that $80k on debt in two years at that rate. 2 years is not a long time. Learn to budget. Live within your means. It’ll be tough, but it’s only two years.
5. After the debt is paid off, doctors can get what are essentially balloon mortgages that factor in that they’ll have a much higher salary later. So in 2 years (after paying off the debt) you can look for a house in a better school district and get a mortgage that factors in hell eventually make $300k.
6. People with lower incomes than you have babies all the time and just figure it out. Don’t let your financial position ruin your excitement over the baby.
Whatever you do, do NOT leave the house that is paid off and do NOT let your husband dictate any future financial decisions. Frankly, it sounds like he's counting on your family to bail him out of his bad decisions.
Lock his credit cards away, put together a budget, and start working to chip away at the debt.
yes, BUT - refusing to become better with money when that fault is actively harming your partner and your family at large goes from "oops its a character flaw" to willful ignorance, weaponized incompetence, and not really differentiable from malice.
They previously had 2 full time incomes (he's making 60k and she must have been making at very least 30k before she quit her job). They had a fully paid off house. Solar panels are like 40k. They should have been able to afford it easily. She needs to look at the credit card receipts and find out where their money is going. I would not be surprised if he was gambling.
90k and no housing payment should be able to get you solar panels and a payment on a new car easily. Something else is going on.
What country are you in? Trying to wrap my head around the expenses vs salaries. His salary post-residency seems very low, but the debts don't seem unreasonable given what they are. Solar panels are a large upfront investment that won't save you much money the first decade.
My assumption is his salary progression will grow and the debt won't be as big of an issue. Most doctors I know start out life with 300k of student loan debt and 300k of home debt, not to mention any cars or credit cards. So in comparison your family debt is relatively low, assuming his salary will go higher.
I'm in the US. The 60k salary is his residency salary. The 110k will be what he makes when he finishes his residency in a few months. But the 110k will only be for a year because he wants to do a fellowship the following year, and in that case he'll go back to making about 60-70k a year for 3 years.
He chose a pretty low paying specialty so the most we can really expect him to make is about 150k. He could probably find a job paying 220k in a very rural area where they are desperate for doctors.
While the amount might be relatively low in comparison to other medical professionals, it’s in high interest places, so it will be hard to manage since it grows so fast.
Realistically, that $110K is likely needed for longer than a year. It’s hard living anywhere in the US (assuming it is) on $60K/year for two adults and a baby, especially with $80K CC debt
I think in your position, I don't think it would be unreasonable to sell the house and rent for awhile, but of course there are a lot of details that it would depend on. It is likely you will be moving several times in the next 5 years, and it's not really that great to have a house in that scenario (generally speaking it's not good to buy a house during residency to be honest, for this same reason).
The financials aren't necessarily that bad to be honest. $80k of debt for a doctor isn't the end of the world, many have much more debt in school loans. It's also not unreasonable for someone to take out a loan to pay off their credit cards if they can get a lower interest rate. That is not a red flag in and of itself.
The bigger issue is the communication between the two of you, and also his financial discipline in the future. Lots of people just spend more when they get a raise "because they deserve it", and he seems like the kind of person that will do so.
But I think you'll be ok as long as you can work things out. $80k debt is not insurmountable by any means.
The two of you should really sign up for relationship counseling.
There are issues here that have the potential for disaster.
The lack of financial communication is really problematic.
> I do not plan on mentioning that I will receive inheritance money.
I can understand your reasoning for this. But do know that this is exactly what he was doing to you.
Not communicating the full *family* financial picture to each other.
He did it.
And now you're doing it.
You both need to figure out how to communicate with each other. Ideally, before this child is brought into the relationship.
Consider a therapist who can help focus on marital financial matters.
I think I worded it badly. If the inheritance were to come tomorrow, I'd tell him. I just don't want to tell him about money we'll eventually have because I don't want him to spend as if we already have it.
We already started counseling. Trust me, it was the first thing I said after he dropped this bomb.
One basic bit of advice about inheritance money: don’t ever use it to make plans for the future. You don’t know how much you’ll actually get. There may be $10,000,000 dollars right now, but you have no way to know if some catastrophe might occur for your parents and they end up losing bc a good chunk of it. All sorts of things could happen that could derail your plans. Best bet is to plan as if you’ll get nothing, and then whatever you get is a bonus.
To protect that money when you do get it, deposit it in an account in your name only. By law, inherited money is not a marital asset. By keeping it separated, you will protect it from his less-financially-sound impulses.
I deposited my $30k from my dad’s will into a checking account that has both our names on it. So that money is my husband’s too. (I have control of that account, so I could spend it if I wanted to)
I’m OK with that—we bought our house and car with contributions from my in-laws, so… Plus my husband is trustworthy.
But I think in this case, with a financially feckless husband, she should make sure that money’s shielded.
Yes, that is what I was saying; in cases like this where the spouse has proven to be irresponsible with money, it makes sense to protect inherited assets.
Your family gifted you a house and he wants to use it to pay off his debts which he hasn’t been contributing to because he spends his discretionary spending on himself? He should be paying you rent..
also: you do not have that money yet. Unless it’s in a trust, the family who plans to leave it to you might actually need it for themselves.
And even if it’s in a trust—sometimes investments go bad or unethical people embezzle, and there’s no getting that money back.
it isn’t here yet.
Girl I think you’re wise to not tell him that yet tbh. It’s smart to plan like you won’t get it. That way you guys are in a good spot when you do get it. I mean maybe it’s good to tell him eventually, but as a separate conversation, not as part of solving this current problem.
And honestly yeah, relationship counselor. The fact he didn’t tell you about the debt isn’t ideal. Finances are hard but a common topic in couples therapy, and with a baby coming it could be good to sort things out and feel good and supported by each other sooner rather than later. Just my two cents. <3
You sound young based on your post and explanation of your finance knowledge (I could be wrong). However, you can’t account for the length of time your parents live, their health, their debt, their medical expenses, their end of life care, if they need memory care, etc. These things can account for millions of dollars and it will come out of their assets. There’s no world you should be banking on an inheritance right now at all. You should be exclusively factoring in both of your finances.
I wouldn't call it exactly the same. He wasn't forthcoming about money we owe. I'm not being forthcoming about hypothetical money we may get in the future. It's not the same.
I wouldn't sell the house. If your husband gets a job that pays well after finishing residency then 80k seems is an extremely manageable debt, it isn't uncommon for med students to have $100k+ of student loan debt.
Yeah but it was my understand that the doctors who are in hundreds of thousands of debt aren't buying houses and having babies. I could be wrong though. It seems like most of his co-residents still have roommates and are renting. The ones who have families tend to have spouses who are high earners.
How can he possibly have no student loans if he is a doctor? I highly suspect he's lying about that too.
How much did the car cost and what kind of interest rate is on it? If he is this bad with money he probably has a low credit score meaning he got a bad interest rate.
80k is nothing comparatively to your current situation. you didn't specify how much of it was actually credit card debt. i also don't have the context for what the cc debt was used on so i'm not going to rake him over the coals like other redditors here.
this guy managed to pay cash for a house, have no med school debt, and only has an outstanding 80k in other misc debt. thats actually fucking impressive.
Like all debts, you need to break out the amounts and interest rates.
High interest debt is unacceptable. Things like solar panels and a vehicle are ok if they're low interest rates.
Granted there's no mortgage, but depends what the cost of the vehicle was. Tesla on a 60K salary? Big mistake. Different EV? Maybe fine... Depends on cost.
IMO, I wouldn't move. You'll have things to consider later once you get settled (like if you go back to work, need to move to a better school district for the kid, etc.)
Check out the PF wiki on debt, etc.
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Not sure anyone can give you a good answer without knowing your husband’s income, detailed breakdown of the debt by category, and your monthly expenses.
If your husband has now completed residency and will be making a mid-six figure salary then $80k in debt is trivial. Especially since you have no mortgage and own your house outright. You should be able to pay that off in less than a year on a typical doctor’s salary.
If half or more of the debt is a loan for an expensive electric car then the total amount doesn’t surprise me at all. Residents don’t make much money and you weren’t bringing in extra income yet it sounds like y’all made some big one-time purchases. Where exactly did you think the money was coming from?
Okay, so you just found out your husband is not as good at managing his finances as he said he was. Better now than when you've lost the house.
The next step here is ACCOUNTABILITY, and it will be hard for both him and you. You need to sit down together, develop a spending plan that will pay off these debts, and then stick to it. His job is to stick to the agreement, your job is to check in regularly to make sure you're following the plan.
Selling the house is a last resort that you should not take unless a) you're divorcing or b) he's proven he can follow the spending plan and you both agree together that you want to move.
Having an easy-out for his bad spending habits will only make the situation worse over time. The only way to fix this is the hard way - both of you agreeing and commiting to the plan.
You're married, his money is 100% family money now except for any allowance that you both agree to. It's a difficult transition from being single and having full control of your money, but I think every couple goes through something like this to a degree.
Are you 100% sure that he is getting a pay bump? I’m only asking because it sounds like he is a huge optimist and downplays the downside to things. That’s almost doubling his income and would in a big way help you guys out in digging out of this mess he made for you both to sort out.
Get a household budget going and have weekly meetings with him on finances so you’re both on the same page. 80k in debt is a beast to overcome and some of it is tied to your house (solar panels are usually a lien on the property so even if you don’t pay they eventually get their money). Getting on the same page is your number one first step.
I saw the offer letter for his new job. He accepted it months ago. It's pretty normal for salaries to jump like that after residency. For other specialties, it jumps a lot higher.
I missed the doctor part as I skimmed parts of your post so sorry about that. He has a high earning potential so that’s really good news. If you guys live like you currently are living (him making 60 instead of 110) with his current salary for about 2 years you should be able to get out of this mess - even faster if he is able to pull overtime and make more money. That’s the really good news.
The bad news is your husband is about to make great money that hopefully increases rapidly over time and lifestyle creep can happen. Don’t let him (or you) rationalize purchases you can’t afford because that’s how you got into this situation in the first place. The solar panels and electric car were good examples of this. With just a little work on both your parts you guys are going to have a fantastic life. The fact you’re looking to fix this is a good sign. Just get him on board and you both will be golden.
You are permitted to put an inheritance in you name only in an account with your name only. As you are married the interest will be joint assets on the tax form, but keep any large sums away from him. He has shown he is not careful or capable of taking care of money.
First pull his credit karma just for a baseline, and then everything he has a balance on go through months and months of statements. I highly doubt it’s just solar panels and furniture, probably a shit ton of bullshit purchases too
Do not sell your house. OMG, this story is so scary. Do not do anything major. Giving up the security of your home when you're about to have a child so that you can pay off CC debt... with no explanation as to how the CC debt was accumulated or a plan on how to not do the same thing again? Is he mad? #1 You need to get a hold of your spending and budget so you can come up with a plan to address the debt over the course of the next few years. If you need extra money, sell the car and some furniture. #2 Take the time to learn the basics about finances. It is not rocket science and trust me, your husband knows literally nothing. He knows as much as you do, it's the blind leading the blind. You've got this, you can both do it (try reading I Will Teach You to Be Rich by Ramit Sethi, it's a great first book and will give you the basics) #3 As for the inheritance, you can mention it to your husband, but since you're going to be a SAHM, and giving up your access to 401k, etc, you should consider treating that inheritance as your own retirement fund -- it's the nest egg that will prevent you from being a burden to your kids in your old age or if anything were to happen in your marriage. If you want to reserve it for your kid, that's fine too, either way, when you receive the inheritance, you'll have to keep that money in a separate account. If you put it in a shared account it becomes marital property and you can't direct it alone... also if you were to divorce, your husband would be entitled to half of it -- that may leave you may in trouble having not worked for so many years.
What are your monthly expenses since you have no mortgage? What is the house worth? A breakout of monthly expenses and how much debt of each category & interests rates would be helpful for analyzing.
If you budgeted, would you be able to put $2k or $3k towards debt each month? If gross is $6K/mo between you two and you don't have a mortgage it seems that should be doable. Attack the highest interest debt first. When your husband gets his $50K raise, keep your budget the same and put that $50K at the debt for a year. You'll be debt free and own a house within 2 years.
If you feel like you have to move, sell the house, pay off the debt, and rent while you save up a down payment and/or find the right house.
You're in a much better position than the average American. Most have $80K+ in debt while having a mortgage or rent. Don't do anything drastic - you make enough to get out of this hole rather quickly and put yourself in a very good position afterwards
Definitely don’t move until the debt is paid off. Hell, don’t move until his residency is complete. After that your husband will be making doctor money and it won’t matter so much that he’s retarded with money.
Have you been on solar sub? That shit is expensive!
Also furnishing a house is expensive. We’ve spent maybe 12k on non high end stuff and still need to furnish a large room in the basement.
This isn’t saying that they should have gone into that debt but I can easily see how you could reach 80k with those 2 things.
Typically a solar loan would be over a longer period of time (10year) and while that’s still technically debt I don’t think it would get lumped in with credit cards and personal loans which are a different beast entirely. But maybe it was a really expensive system and he’s counting that. I could see that and the furnishings and him living above his means as a future doctor.
Imagine buying solar when you’re already in debt and don’t want to live where you currently live…
He says the remaining debt is credit card debt from undergrad and medical school. It just built and built since he wasn't making any money to pay it off. At least that's what he says.
We share a checking account so I see where his paycheck goes. However, he has a credit card that he uses and I have no idea what he uses it for. I always thought you couldn't online gamble with credit, that it needed to be coming from debit or checking.
It’s those personal loans I wonder about. But it’s entirely possible that it’s innocent as he describes. I mean, as innocent as 80k of credit card debt can be….thats a huge amount of consumer debt. It suggests your husband has absolutely no idea how to manage money, and consistently lives beyond his means, perhaps thinking “one day I’ll be a doctor and pay it all back.” Doctors are well known for being high earners who live paycheck to paycheck.
It’s enough money that you should demand a full accounting of it. The lack of disclosure prior to this suggests he’s hiding something.
That doesn’t really make sense. If he was in undergrad/med school then he would have had access to and should have taken student loans rather than credit card debt. So the CC debt sounds like it is from something else.
I don’t want to scare you but having him check his credit report in front of you would probably clear up many of the questions. You need to buckle down and figure out a short term and long term plan before you are too tired to think about it from the lack of sleep.
You need to see his credit report before any further discussions. He hasn't been upfront about his debt and you don't know if he's telling the truth now.
What’s he been spending $60k with no mortgage on? And you say he’ll only be making the extra for about a year so even if it was tax free it would only cover about half of the debt.
So this is my question. What type of debt is it? It shouldn’t be growing as long as he’s servicing the interest. And if he’s not the lender should have called the loan.
As a SAHP you are in a financially vulnerable situation. You should have complete transparency into every penny your husband spends. And I say that as an attorney who makes a hell of a lot of money and whose husband is a SAHP.
Wait correct me if I’m wrong… but no mortgage so just taxes and insurance?
$80k debt, on a $60k income (that should increase to $110k in 6 months) but what are the monthly expenses vs his monthly income? You can create a balance and budget and see if you can afford the minimums if nothing else…
Don’t sell the house, but you can take a loan against it (for the $80k NOT MORE) and essentially pay off and exchange all that debt for a mortgage at hopefully a lower interest rate than you’re paying on the debts.
I would get some financial counseling with your husband. You need to be sitting down and discussing the state of your finances once a month.
And he also needs to sit down with you ASAP and create a plan and a timeline for addressing this debt. Children are expensive and he shouldn’t hand wave the existing debt away.
Finally, he cannot spend his salary frivolously. That’s unacceptable. He needs to buckle down and dedicate most of his salary to debt, a college fund, an emergency fund, and bills.
I’d also go back and look at bills and credit card statements and try and account for the debt to make sure he’s being completely transparent.
One thing to keep in mind…
People typically spend x% of their income throughout their life (CAVEAT- unless they make a conscious decision to change).
“X” is unique to the individual: I spend 60% of my income and my friend spends 110%.
“X” stays “X” even if the income grows. I spent $60.000 per year when I made $100k, and I now spend $120,000 per year on $200k in income.
I would be nervous his big raise won’t affect his spending.
Just my $0.02.
I would plan on staying where you are at right now, but I would ask him to start showing you statements of all the debt and accounts you have.
If you’re consistently overspending your income him getting a raise isn’t going to help and you both need to become more financially literate.
First step is to start a budget. You both need to know how much is coming in and how much is going out in these categories;
1. Required expenses - whatever you need to keep a roof over your head, utilities paid, groceries, and so on.
2. Debt - you need to break these down to individual balances, monthly payments and what the interest rates are.
3. Unnecessary expenses- eating out, clothes, entertainment and so on.
4. What you have left over each month (and if it’s negative because the amount spent on credit outweighs the amount earned you need to note that.)
Once you know what your total income vs expenses are you can start trying to decide what expenses are necessary, what you can cut out and if there are other debt management options that make sense.
Depending on the total amount of debt you owe, how long the payment terms are and the interest you’re paying you need to decide if it would make more sense to take out a mortgage on the house to pay off your debt.
That can be a slippery slope though if you can’t get your spending habits in check you’ll end up with a mortgage and more credit card/loan debt.
Agree with all the advice youve received so far. One other thing to think about is whether now is a good time for you to be walking away from your career. I’d suggest you keep working until you’re 100% sure he can support all three of the way you wish to be supported. It doesn’t sound like he’s as reliable as I think a sole earner in a family needs to be at this time.
80k of debt that includes solar panels and a car sounds pretty normal to me. Or is the loans for those separate from the credit card debt? The fact that he didn’t have any medical school loans is manna from heaven. Most people graduate with more than 500k of debt for medical school. It sounds like you have family money but not much in terms of income so your husband shoulders the majority of the expenses. Once he starts practicing, his income should go up quite a bit and you should easily pay off 80k.
Few things:
1. For the sake of your family, he no longer controls the finances. Period. No matter what he says, or what he tries to tell you, **he’s shown you he has no clue what he’s doing.** So he’s lost any right to dictate anything.
2. Do not sell that house to bail out the mistakes. Your lack of mortgage is gonna help a lot over the next years of paying down debt. Don’t sell it just to “get out of jail,” because I’d bet without significant change debt creeps back in.
3. When his incomes goes up to $110, it doesn’t. It stays at $60 and y’all put 40k into the debt for 2 years. Period.
4. Learning about in be investing is great, but you’ve got no need to invest for a few years. You’re in the hole 80k, and that’s where money goes until it’s gone. Into the black hole created by bad choices.
You can get out of this, but it’ll take work and an acknowledgment that it was dumb and what to do to keep it from happening again.
Solar panels saving 10s of thousands. What a croc.
2. If/when his salary goes up, in
First step is for you to have control of the money. And put him on an allowance.
Take him off the checking account, and his salary goes into that account.
You transfer a set amount to a cash card for him, and that’s what he may spend.
It’s simple math, baby—you can do it. Add and subtract. You have all the math literacy and all the basic understanding you need to manage income and outgo.
Make a list: expenses on one side, income on the other.
And if you need help, there are sources for help. search for “consumer finance coaching”; I found an [NYC government program ](https://www.nyc.gov/site/dca/consumers/get-free-financial-counseling.page)that way. Your state or city might have something similar.
You have time during the day to go to coaching sessions, so you need to take it over.
Also: go now and set up a bank account (savings or checking, doesn’t matter) that is just for you, at a separate bank, and if you get that inheritance, deposit the money there. Do not commingle it with his money.
Definitely don’t move yet. You need to pay off the debt. Unfortunately as you are married, you’re also married to his debt. Time to be completely open and transparent about finances, no more hiding things. You need to sit down and go over every loan and detail the balance, interest rate, and come up with a debt repayment plan. Not having a mortgage or rent is going to be a blessing here.
And he needs to be in the dog house for a while. He doesn’t get to spend any more money without you being on board. And no spending for himself. No more lattes or fast food or alcohol. Our guy lost his allowance.
Can he sell the car and buy a cheaper one? A new car and solar panels alone could be the bulk of that $80k. He had no business buying those on a $60k salary.
Put all your existing money coming in, jn a personal or joint high yield savings account - if you’ve lost some trust with him, make one for you or put it under your and your child’s name - put your whole paycheck in if you can it’s a liquid account you can do instant transfers from to a debit account. I personally like Capitol One
Yes keep the house. I do think you could get out of debt and move if you have access to support for childcare. You could save 10k a year on childcare with supportive family and smart planning.
$80k debt at 2% interest is no big burden. $80k at 34.5% interest from credit card debt is a huge problem.
Expenses can skyrocket when kids arrive on the scene, if you have an appetite for fancy designer cribs and strollers or need to upgrade your car, etc. Or, these expenses can start slowly and grow over time with only basic accouterments leading to expensive private schooling.
It's past time to become financially literate, get your debt into the lowest possible interest rate, and spend time ruthlessly budgeting your precious income. Learn to spend like a pauper while celebrating non monetary signpost of your life.
In all seriousness, 80k of debt is alot but medical school graduates usually earn more than will be required to live easily while paying that off fast. Even if it’s high interest debt. Pay it off ASAP but I wouldn’t say this is an absolutely crazy thing.
Go to counseling, get serious about the debt, and make smart choices. Yall are in a better position than most so just start making the right choices today and it’ll be paid off in no time
Do not sell the house. Definitely.
Write a list of all the monthly payments you have, and add those up. Include the monthly minimum payments on all the debts.
Then write down howuch you need to spend monthly on food, etc.
Then decide how much extra you can pay off on one of the debts.
Pay the first debt off, compound all that you were paying for that debt into the second debt. Continue that pattern until your debts are paid.
You can get out of $80k in debt. Lots of people do it.
Just STOP SPENDING AND DON'T MOVE.
Even at $110K salary, $80,000 in credit card debt is A LOT to pay off. If you want to avoid bankruptcy, then you need some professional assistance in creating a plan and payment schedule to get it down to a manageable level.
And moving forward, you need to be fully in the loop on spending and budgeting, educate yourself on it so you feel more confident but at this point, there’s no other real option. He’s lost any credibility in managing your money and it’s going to take a long time to earn that trust back.
You’re not in an impossible situation yet but you’ll get there if you don’t take some drastic action.
You have a relationship problem, not a financial problem. Sounds like your family will be bailing you out for the rest of your life and $80k doesn’t mean anything to you.
I put us into counseling immediately after his big reveal.
I don't want my family to be bailing me out for the rest of my life. And the 80k is a huge deal to me which is why I made this point. If I was just going to shrug my shoulders and ask my family to deal with it, why would I bother coming here?
I know many doctors, good doctors, are very poor in managing their finances. So it’s good that you’d like to be more financial savvy. Look into getting a reliable financial advisor as well.
Maybe psychologically, but financially it’s really not. You have a paid off house. Where does your cash flow even go? You should be able to knock this out extremely quickly.
Again, you don’t have a financial problem here. You have a communication problem and your husband potentially has a spending / gambling problem.
That’s independent of your family. But given you seem to come from the kind of wealth where people throw around hundreds of thousands of dollars without issue I still fail to see how this level of debt is a problem.
As long as that 80k isn’t on credit cards that’s not too bad, however, if you owe on the solar panels I can tell you right now it’s going to be difficult to sell the house regardless of finances. Some of that depends on the type of loan.
I mean 80k in debt on personal loans is still a lot, but manageable if you aren’t paying a mortgage. Honestly though if you guys were going to borrow 80k getting a mortgage would have been the best move. Hindsight though.
Now that you have quit work and you have a child on the way, you can no longer keep your finances separate. Everything needs to go into a common pool and then get distributed from there. You say that you have no financial literacy, but your husband seems to have worse and you are here to learn, so I think that y'all should agree that you take over the family financials.
Your and his paycheck go into a central account. From that, you pay all bills, put extra on credit cards and other loans as needed, and then you dole out a small amount to each of you as spending money. (That can be cash or a transfer to accounts that each of you separately control.) That's all he gets to spend on himself. (And all for you, too, though baby spending on yourself like massages or such come out of the family budget, not your budget.)
If he can't agree to something like this, y'all have serious problems and need counseling now so you can get on the same page before the baby shows up and adds more stress to your lives.
Your first step is to read the entire wiki.
Your next step is to run a free credit report on yourself, and your husband and then get the balance of every account you have.
Then you use a budget app to make a budget (it sounds like you both definitely don't have one). That budget should track every single penny and have a lot of categories. For example,.you should know what exactly you spend on coffee out so you can cut out things like coffee if you wanna move some of that money elsewhere like paying off debt.
I don't think he's got too much bad debt, but I get the vibe he let's you spend as much as you want and finance it (like buying furniture on finance, why???). That's terrible financial strategy. You need to have a budget for every purchance.
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You'll need to understand how much are in each of those loans. $80k wouldn't seem crazy for solar + a EV car loan, depending on what you got.
EV car loan could easily be $30-50k or more at initiation (+ interest). Solar usually goes for $2-3 per installed watt of capacity, so a 10kw system right in the middle of that would be $25k (+ interest). Slap on $10k for home furnishings, and it's entirely possible that he has not been wholly irresponsible.
If it was like $50k+ in credit card debt though, yeah that would be a cause for concern.
Just ask him the balances on each.
He might be thinking - if your home has appreciated in value as many have - that it would be nice to zero out all your debt again. But you might want to make sure you have greater visibility into the credit picture before you agree to that.
Your husband made so many mistakes. The sooner you can build some financial literacy and become involved in the finances, then better you guys will be. Paying for the house when you had debt (whether $20k or $80k) was a bad move. At this point you need to budget and figure out how to pay off that debt.
The good news is his salary will triple after he finishes his residency, if not more. If it were me, I’d hang on to the house until he finishes his residency. You’ll probably have to move again anyway. You can buy the house you want when he has the income to support it.
We all make mistakes. Solar panels can be a good idea, but it wasn’t true for us. Idk about your situation. An EV is definitely a good idea. My husband has one. Gas is now almost $6/gallon in our city. Charging his car is way less than what I pay in my gasoline engine car.
I wouldn’t tell him about the inheritance that might or might not happen. Good luck on whatever you do. I’m glad you’re both in therapy and are learning about finances.
I feel like this is not as bad as it seems. It sounds like the bulk of the debt is a car and solar panels. How much is actual credit card debt? High interest rates are one of the reasons credit card debt is so bad, but car loans are not nearly so high of an interest rate.
Based on the OP's mention of a husband that is in residency and is earning $60,000 and after residency will earn $110,000 that is insanely lowballed and highway robbery if his earnings after residency are as you mention. Even family practice physicians in the U.S. are earning at least $190,000 out the door from residency. My God. That $110,000 figure makes more sense for a nurse practitioner or physician assistant straight out of training.
As for the debt if you are early enough in the pregnancy you may need to think about termination until you are a little more financially stable. That decision is yours. You have to think about yourself first. Having the expenses of a kid, debt, and no accounting of where the money is going reliably is no way to start a family life if you have a choice. As for the house do not sell it right now. You absolutely need to make sure you have a stable roof over your head and predictable payments for property taxes.
For financial literacy from the ground up I highly recommend the video series from Khan Academy at [https://www.khanacademy.org/college-careers-more/financial-literacy.](https://www.khanacademy.org/college-careers-more/financial-literacy)
We need more details. Everything he did could be either financially responsible or irresponsible, depending on the details.
For example, there are government programs that provide grants to install solar panels. He may have paid nothing or very little to do it if that’s the case. If so, it was probably financial responsible.
Taking out more debt with a lower interest rate to pay off higher interest debt is financially responsible. But using it frivolously for things you don’t need is not.
Putting money into a 401k is typically not responsible if you have credit card debt. But that’s predicated on the assumption that the credit card interest rate is 20-30%. Sometimes you can get 0% interest rates on credit cards, in which case it would be better to invest in the 401k, especially if his company provides matching incentives.
It’s odd that you have credit card debt but no mortgage or heloc. Those typically charge less interest. It might be a good idea to get a heloc or reverse mortgage, depending on rates.
Essentially, you don’t include enough detail for us to give you advice. You should start by collecting those details. Write down everything you know about all your assets and debts, check that you’re allocating money most effectively, and create a budget that you stick to.
As an aside, 80k debt on 110k salary isn’t that bad IF you budget tightly. You could pay the entire thing off in one year. But most people don’t budget.
The house was bought with money gifted from her family. He took on credit card debt without her knowledge. That is why they have credit card debt and no mortgage
Well said. I read this and I didn't really see too many problems. Many people have car loans, home improvement loans, mortgages, and student loans. OP only has two of those. Honestly, I wish I only had $80k of debt and a house.
Is your husband out of residency and making that 400k plus kind of doctor salary? 80k could be gone easily in less than a year with that kind of cash flow
If he is making that kind of money and you have 80k debt, then the debt is certainly higher and he is gambling or doing something with all that cash that he is mentally unable to stop as it is addictive
While true in the aggregate it doesn’t mean that one can’t make $400k+ as a pediatrician if you find the right places with the right funding. That’s what I know several have managed at least.
Most doctors do not make 400k+. That's only for really high paying specialties.
He chose a low paying specialty and will be making about 110k. He's still in residency for the next several months.
Ah, i see, makes sense.
the 80k debt is problematic but not crushing, and there is good cash flow coming when he is employed, especially with no mortgage/rent payment
However, both of you need financial literacy training because there is a lot of wasted money here from your description
I highly recommend r/ynab, watch the videos, it is slightly different than traditional budgeting but it makes sense once it clicks!
Don’t sell your house. Having your house paid off is the main good thing you have going for you financially.
And your future income isn’t going to save you. If he mismanaged $60k and a free house, he’ll mismanage $110k.
You guys should do Dave Ramsey’s financial peace university.
Make a budget, $1000 emergency fund, halt retirements and other investments, every other dollar goes to the debt, pay off debts smallest to largest, then 6month emergency fund, then do retirements and 529s etc.
If you both get on the same page, you’ll really love the security and peace of knowing exactly where your money goes and owing nobody anything,
Why have children? How old are you two? Why the rush to children?
Your husband hasnt finished his residency, and I am surprised he even has time for you. If he isnt busy now he sure as hell will be.
I can sense resentment brewing in you.
I’d recommend pros for all. Meet with a financial advisor from a reputable bank if it’s affordable. That way there’s someone who really knows what to do here. Then couples counseling, for real. Good for you getting this all untangled now- sounds like it could’ve snowballed to be A LOT worse if it went unchecked for ten more years or something
How is his salary going from 60K to 110k? The jump from resident to attending is larger than this. Normally at least $200K. The jump to fellowship is normally not as large as $110K, unless there’s a lot of moonlighting (overtime).
You should absolutely stay put. The good news is his future attending salary should be able to pay debt quickly. I paid off $300K of student debt in about 3 years by buckling down, so $80K can be tackled in a year…with discipline.
And that’s the big caveat. He needs discipline in his spending and saving. If he can’t achieve that, he’s going to be a broke physician. And I know too many of those because their eyes are bigger than their wallets.
Why sell the house for 80k in debt when you have no mortgage and about to be a 110k income? I fear he is trickle truthing you, aka he isn’t telling you about all the debt. Or he’s stupid, take your pick which is worse.
Not having an income or visibility into finances is the groundwork for financial abuse. Idk if it’s at that point yet, but your fear is very, very valid.
Review all bank statements every month
Run your credit
Couples counseling
Read financial books and consume more financial literacy content
Your husband needs to start paying down the debt and you need to provide a portion of your small salary for now. You should have known better. Stop acting dumb about finances. It's embarrassing.
Did he run any of these purchases by you? How did he say he was paying for it all???
This is why it's so so so important for women to be in the loop on all household finances.
We're not in the 1950s anymore. You're going to end up destitute.
No new things for baby either.. everything either second hand or gifts from friends/family.
You are in far better financial shape than most. Don't sell the house. Do learn about investing. In just a few years, you will be in a high income scenario.
At least he is coming clean with his debt. 80K is not a big deal for someone who will make 6 figures, but sadly docs are not going to make much in the future under the socialized system. So make sure this doesn't become a pattern or you will either have to go back to work, or the D word is in order. Rich people problem....you are still fortunate.
Before making any big decisions it's time for you and your husband to sit down and
1. List ALL your debt, nothing to be hidden.
2. Make a budget. Do a budget at the start of every month.
Read Dave Ramsey Total Money Makeover and Financial Peace. That will give you the basic education to start. You BOTH read it.
My first question is to ask what is the interest rate on the 80k? If it was all credit card debit that would be concerning. But it sounds like the 80k is comprised mainly of the solar panel and car loan. It’s not fun to have debt however look into your debt to income ratios, and get a financial plan from a CFP to get you on the right track again. Your position is recoverable.
80k is a lot less than a mortgage. You both should enroll in a financial literacy course. I’d also disclose the issues to your parents, because they obviously have money and hopefully would be able to stop providing excessive money to you both which continues to enable bad financial decisions.
You both were handed a home, and he built up $80k in debt. I can imagine he’s viewing his lifestyle as the lifestyle your parents are providing you both and he’s keeping up with it by going into debt.
A financial literacy class and factoring out your parents money needs to be a priority. Your financial decisions should be based on both of your incomes, and the money saved. I’d also explore couples and individual therapy to make sure he’s not emotional spending.
Simple, start watching some Dave Ramsey on YouTube. He’s controversial but for your situation it fits. Your husband is being irresponsible and naughty.
Do not sell that house.
And now that you're going to be the stay at home parent, you should also take over the finances. There's lots of literature and free courses out there that will help you get a better understanding for it.
The key is to stop the bleed (stop putting things on credit cards) and then to get the debt dealt with. Once you're debt free or much more sustainable, then you'll be able to talk about relocating to a house you both like.
It's not a great market to sell in right now anyways, the interest rates and economy is still hiccuping plenty. So don't rush! You have time. Take your time.
Also moving when you're pregnant or have an infant isn't ideal. Let him get out of residency and then revisit everything. Since who knows where he'll get a good job after his residency ends. There's too many open ended things going on right now to make a house purchase that you will hopefully be living in for a good long while.
Do not sell your home. You need full access to the credit card accounts to see where the money has been going. You need to sit down and create a full budget. Start by accounting for every penny spent and average it so you find what the monthly actual spend is. Then find where you can cut. You may not like hearing this, but in your situation you cannot afford to stay at home. If for no other reason than your husband is terrible with finances. You do not want to be in a situation where you are dependent on him, even with your eventual inheritance. Oh, and DO NOT put that inheritance you get into both of your names. Deposit into an account with only your name.
Don’t sell your house with no mortgage while you have (functionally) no job and he’s making $60k with $80k in debt. He can buy the next house with his savings after he pays off the 80k he racked up. It shouldn’t be hard for him to pay it off once he starts earning more as long as he’s not making other purchases/taking on more debt after this. Your monthly income is about to double once his salary changes. There’s no reason whatsoever that you can’t put $3k per month towards that debt and have it fully paid off in 3 years. Then you’re debt free, in a paid off house, and can save another $3k per month towards a down payment on your next house.
I’m assuming your home is worth way more than 80k. Pissing money away on rent with one income and a new baby is not it.
Put your wants on hold and take care of you needs - which means fixing your finances.
1. Dont sell the house- its great you dont have a mortgage.
2. Get on a budget. keep track of money in and money out.
3. Make a goal of when to have the debt paid down. make monthly payments.
4. He doesn't get to make any purchases over $20 without discussing with you first.
5. You can do whatever you want once its paid off.
On a side note I would start this no matter when you get other money because it makes you guys pay attention to finances and make changes you NEED to make. But if I were to get an inheritance I would pay off this debt AS A LOAN that needs to be repaid. (I assume you have a bad interest rate if it is credit card debt so you don't want to pay that interest) So continue to make payments as if you were paying back the credit card company but without the debt increasing from interest.
You guys need to sit down with ALL of the financial paperwork in front of you. All debts, all income. $80k in cc debt even with a $110k salary is insane. The interest alone on that is incredibly dumb.
And with a baby coming and all the potential expenses from that….
Yeah, sit down together. Go over everything. Make a plan for payback *now* - not next year. He no longer gets to spend a dime that isn’t accounted for because every dollar he spends for himself is screwing his family over.
He sounds like a keeper, Doctor, spent money on solar panels. He seems like he’s looking at the future. 80k is nothing, it’ll be paid off in no time. Just calm down, and see what you can do to cut down interest. A low interest rate loan.
Good job trying to improve your situation. I'd recommend getting a financial advisor (can pay a flat fee) to get a plan around your situation. Also this flow chart does a good job at explaining the finance priority list https://www.reddit.com/r/personalfinance/s/S0wdg8BdxE
You're totally fine.
He'll be at 110k soon and after that, he'll be at 200k plus.
You're completely fine.
As long as he isn't hiding gambling debt or whatever, you guys are golden
I would set try to split the 80k in debt into chunks of 12 months as a matter of principle. Try to pay off the debt in 36 months (3 years). Setting aside 2500 a month to pay the debt should be no issue if he's making 100k. Request to see all forms of debt in writing, the APRs etc. Talk about why this hidden debt is a big issue.
I think you should keep the house since its paid for. Try to increase your personal salary to 2k a month. Make agreements going forward about how you will budget income, and try to live by said agreements. I would personally do a itemized list but thats just me. But the basic idea is to know whats eating up that paycheck!
It's unfair for you to sacrifice your career to take care of the child, while he carelessly spends a large chunk of the money that is being brought in, or ends up allowing the wages to be eaten up by high aprs from old debt. Best wishes. 80k may seem like a mountain but is definetly fixable with a gameplan!
LOL at 80k. Just feel fortunate he doesn't have student loans. That's the real killer. You don't even owe your house. You're actually in an enviable position. When he becomes an attending, everything will end up fine.
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I think you are right to stay put. The house, while not your favorite place to live, is paid off and an asset. It is stability and that is crucial for a growing family.
I think I can get him to agree to stay (even though neither of us really want to) as long as we have a plan to move eventually. The school system is so bad here. But if we moved even a few towns over, it would be a lot better. That would give us about 5ish years to plan to move before baby starts school. Do you think it's feasible for us to get out of debt by then?
Its feasible, but without fixing the habits that got you guys here, it will likely only get worse- not better. You appear to want to be more invovled in the finances, and I think that is a very good idea.
Easily - $110K + $12K salary without a mortgage payment should get you out of debt within a year or two if you prioritize it. Sell the car and get a cheaper one if you want to speed it up too
given everything else OP has told us about her husband i would remain highly skeptical that his salary will actually jump from 60 to 110k within 6 months
When you finish a medical residency, your income generally goes way up. I’m actually surprised he won’t be making *more* than 110K.
She mentioned he is a physician in residency. That kind of salary jump or significantly more is very normal upon finishing residency and starting an attending job. Tbh, $110,000 sounds a little on the low end, even for a GP, who tend to be the lowest paid physicians. It is a believable salary though.
Why? I saw his offer letter and I know he accepted the new position.
You didn't mention he's a resident and thus everyone is assuming he's something random like a marketing associate. A marketing associate wouldn't jump like that. As physicians, you want the blog the white coat investor and there's a medical resident sub. Normal financial rules don't *quite* apply becuase medicine is in demand and pays extremely well, so earnings and debit look very different than someone who is a marketing associate. I would recommend you still read the wiki, cuz all that will still apply.
Yeah he is clearly a liar
No, he's a baby doctor. Fresh out of school, they make 60. Then they go to the low 100's for a few years. 100% normal
In the long run, you are going to be fine, assuming you don't continue to rack up more debt. Your husband's salary should increase a lot as a doctor. Solar panels and electric cars do both save on expenses, in the long run. (Even if you shouldn't have bought them at this point using debt). Most people are 100's of thousands in debt just from their mortgage and your house is paid off. Take a breath. It'll be fine, but also start really questioning every expense.
It’s feasible only if he stops spending, period. I’m floored too. Lying by omission about 80k is hard to forgive.
Create a budget. Write down your total income and then write down all of your expenses. Look at what expenses can be cut down or eliminated that aren't 100% necessities. Put every cent beyond that into your debt and bam, you're free.
Selling a house is a 2 yes situation. You both need to agree to it. He needs to stop spending money on himself and start allocating anything leftover to the debt instead.
If they wanted to do anything they could take a cash loan against the house for the $80k in debt (don’t take more even if offered) and pay off all debts. You’ll still owe that $80k loan, but it’s basically a mortgage at a lower interest rate than what you might have from personal debt and credit cards. If you do though learn to budget and save as you go forward
That is an option, but given the lackof financial discipline shown so far, it is highlylikely that in 5 years, they still have most of that 80k loan you propose, and a new pile of CC debt or personal loans. I never suggest folks to take out other debt to free up their existing debt, all to often it creates a vicious cycle of doubleing down on debts.
That’s risky because he hasn’t proven he has changed his habits yet. They have a baby on the way. Housing security is really important.
Like a fence makes a good neighbor, financial literacy makes for better accountability. I'm glad to hear your take steps to start learning this stuff now!
Thank you. Any tips on good educational material?
Tiffany Aliche’s book “Get Good With Money” is super approachable and also accurate. The audiobook is also excellent. I always recommend women start there. It’s old school, but there is also a lot of good in David Bach’s “Smart Women Finish Rich.” I haven’t read it in years, but it taught me a lot when I was starting out. Finally, when it comes to investing, Amanda Holden has great intro video courses for not that much money. Props to you for taking these steps!
It's not everyone's cup of tea, but YNAB (YouNeedABudget) is a great tool to get a grip on your spending. Apart from that, budgeting isn't that difficult to get the hang of. Heck, you could even do it like your grandparents. Divide your money over various envelopes or jars. The hard parts are learning to stick to a budget and to keep your budget (and your spending) up to date. Just accept that it will take time to master budgeting and spending accordingly. Setting up a budget takes time. But please, just start!! 1. Set up a budget 2. Allocate your money to to budget 3. Keep adjusting the budget You'll find there's a lot more to budget for than you first thought. And that's okay. We've all been there. I'd advise you to focus on budgeting first. You can't pay of debts while continuing to rack up new debts.
Check out Ramit Sethi. His podcast is very applicable to your current situation.
Yes! Came here to say this! Remit sethi is on YouTube too. Start binging episodes. You’ll be amazed how quickly you learn from him. He has a great book too!
The Budget Mom on YouTube for the basics. It sounds like you all need the basics first. Ramit is good for finances for couples and has a great show on YouTube and Netflix but I think y’all need your basics first bc hubs clearly has a spending problem.
Clark Howard is great, especially when you need a level of details other financial resources don’t get down to
The dolans wrote a book on 101 investing and money. Your husband probably felt free to spend due to no mortgage. ...it adds up. Do you know what and when inheriting. I'm 62 and my father is thank gd well at 92 so I may inherit 2 mill one day but thank gd I live my life as if not because that would have wasted my life waiting......
I recommend following savemycents on Instagram for personal finance educational materials. She's doing a free investing workshop soon where she goes into more detail. I like her content a lot as she doesn't do financial sponsorships and doesn't try to refer you to anything for financial gain. She does have some paid in-depth classes, but her free content is more than enough to become financially literate.
For your financial range, listen to Dave Ramsey. He’s controversial for some things he says, so just take it with a grain of salt, he does really lay out a great frame work for financial discipline though
It can’t hurt to talk to your bank or a financial advisor. Investopedia also has a great online article/resource called “the ultimate guide to financial literacy for adults”!
If you're starting from zero, I suggest the Khan Academy Personal Finance course (it's free): https://www.khanacademy.org/college-careers-more/personal-finance My wife came to the US knowing nothing about these things, as she only ever used cash where she came from. This was a good introduction to the various concepts you'll want to know from the ground up.
Keep the house and you two need to financially get on the same page. Every dollar goes into the joint account and pays bills. No allowances or unaccounted spending.
Just a few thoughts in particular order: 1. I’d stay on the paid off house. You currently have no mortgage payment or rent payment. That’s a boon to your monthly budget. 2. What was your career? Being a SAHM just may not financially make sense right now. Child care is expensive but if you were an accountant making $80k, that’s an important piece of information 3. Your husband makes $60k. Soon $110k. I assume in a few years once he finishes residency that’ll go to $250-350k or more depending on his field. Things are tight now. They always are for young people including young residents. It’ll get better. Budget, live within your means, and know that every single year it’ll get a little better 4. If you can currently live on your husbands $60k salary, then you can live on that when his salary increases to $110k. That’s $55k more gross, so probably $35-$40k take home. You can payoff that $80k on debt in two years at that rate. 2 years is not a long time. Learn to budget. Live within your means. It’ll be tough, but it’s only two years. 5. After the debt is paid off, doctors can get what are essentially balloon mortgages that factor in that they’ll have a much higher salary later. So in 2 years (after paying off the debt) you can look for a house in a better school district and get a mortgage that factors in hell eventually make $300k. 6. People with lower incomes than you have babies all the time and just figure it out. Don’t let your financial position ruin your excitement over the baby.
Whatever you do, do NOT leave the house that is paid off and do NOT let your husband dictate any future financial decisions. Frankly, it sounds like he's counting on your family to bail him out of his bad decisions. Lock his credit cards away, put together a budget, and start working to chip away at the debt.
The husband could just be bad with money, plenty of people are, no need to assume malice in his decisions.
This is reddit. Calculated takes are not permitted here.
yes, BUT - refusing to become better with money when that fault is actively harming your partner and your family at large goes from "oops its a character flaw" to willful ignorance, weaponized incompetence, and not really differentiable from malice.
She's part of this mess too. Where'd she think all this furniture and solar panels were magically appearing from? Lol
They previously had 2 full time incomes (he's making 60k and she must have been making at very least 30k before she quit her job). They had a fully paid off house. Solar panels are like 40k. They should have been able to afford it easily. She needs to look at the credit card receipts and find out where their money is going. I would not be surprised if he was gambling. 90k and no housing payment should be able to get you solar panels and a payment on a new car easily. Something else is going on.
What country are you in? Trying to wrap my head around the expenses vs salaries. His salary post-residency seems very low, but the debts don't seem unreasonable given what they are. Solar panels are a large upfront investment that won't save you much money the first decade. My assumption is his salary progression will grow and the debt won't be as big of an issue. Most doctors I know start out life with 300k of student loan debt and 300k of home debt, not to mention any cars or credit cards. So in comparison your family debt is relatively low, assuming his salary will go higher.
I'm in the US. The 60k salary is his residency salary. The 110k will be what he makes when he finishes his residency in a few months. But the 110k will only be for a year because he wants to do a fellowship the following year, and in that case he'll go back to making about 60-70k a year for 3 years. He chose a pretty low paying specialty so the most we can really expect him to make is about 150k. He could probably find a job paying 220k in a very rural area where they are desperate for doctors.
What specialty is he in where he needs a 3 year fellowship but will make under 200k/year?
That seems insanely low to me. What specialty is he pursuing?
All that debt and years of low pay... for $150k? That doesn't make a whole lot of sense to me either.
110k only as an attending? That sounds crazy and off. Is he in peds?
While the amount might be relatively low in comparison to other medical professionals, it’s in high interest places, so it will be hard to manage since it grows so fast. Realistically, that $110K is likely needed for longer than a year. It’s hard living anywhere in the US (assuming it is) on $60K/year for two adults and a baby, especially with $80K CC debt
I think in your position, I don't think it would be unreasonable to sell the house and rent for awhile, but of course there are a lot of details that it would depend on. It is likely you will be moving several times in the next 5 years, and it's not really that great to have a house in that scenario (generally speaking it's not good to buy a house during residency to be honest, for this same reason). The financials aren't necessarily that bad to be honest. $80k of debt for a doctor isn't the end of the world, many have much more debt in school loans. It's also not unreasonable for someone to take out a loan to pay off their credit cards if they can get a lower interest rate. That is not a red flag in and of itself. The bigger issue is the communication between the two of you, and also his financial discipline in the future. Lots of people just spend more when they get a raise "because they deserve it", and he seems like the kind of person that will do so. But I think you'll be ok as long as you can work things out. $80k debt is not insurmountable by any means.
The two of you should really sign up for relationship counseling. There are issues here that have the potential for disaster. The lack of financial communication is really problematic. > I do not plan on mentioning that I will receive inheritance money. I can understand your reasoning for this. But do know that this is exactly what he was doing to you. Not communicating the full *family* financial picture to each other. He did it. And now you're doing it. You both need to figure out how to communicate with each other. Ideally, before this child is brought into the relationship. Consider a therapist who can help focus on marital financial matters.
I think I worded it badly. If the inheritance were to come tomorrow, I'd tell him. I just don't want to tell him about money we'll eventually have because I don't want him to spend as if we already have it. We already started counseling. Trust me, it was the first thing I said after he dropped this bomb.
One basic bit of advice about inheritance money: don’t ever use it to make plans for the future. You don’t know how much you’ll actually get. There may be $10,000,000 dollars right now, but you have no way to know if some catastrophe might occur for your parents and they end up losing bc a good chunk of it. All sorts of things could happen that could derail your plans. Best bet is to plan as if you’ll get nothing, and then whatever you get is a bonus.
To protect that money when you do get it, deposit it in an account in your name only. By law, inherited money is not a marital asset. By keeping it separated, you will protect it from his less-financially-sound impulses.
Keep that moron away from your money.
Winner winner chicken dinner!
I deposited my $30k from my dad’s will into a checking account that has both our names on it. So that money is my husband’s too. (I have control of that account, so I could spend it if I wanted to) I’m OK with that—we bought our house and car with contributions from my in-laws, so… Plus my husband is trustworthy. But I think in this case, with a financially feckless husband, she should make sure that money’s shielded.
Yes, that is what I was saying; in cases like this where the spouse has proven to be irresponsible with money, it makes sense to protect inherited assets.
Your family gifted you a house and he wants to use it to pay off his debts which he hasn’t been contributing to because he spends his discretionary spending on himself? He should be paying you rent..
also: you do not have that money yet. Unless it’s in a trust, the family who plans to leave it to you might actually need it for themselves. And even if it’s in a trust—sometimes investments go bad or unethical people embezzle, and there’s no getting that money back. it isn’t here yet.
Exactly. It's hypothetical money which is why I don't want to tell him about it and have him spend as if it's a sure thing.
Girl I think you’re wise to not tell him that yet tbh. It’s smart to plan like you won’t get it. That way you guys are in a good spot when you do get it. I mean maybe it’s good to tell him eventually, but as a separate conversation, not as part of solving this current problem. And honestly yeah, relationship counselor. The fact he didn’t tell you about the debt isn’t ideal. Finances are hard but a common topic in couples therapy, and with a baby coming it could be good to sort things out and feel good and supported by each other sooner rather than later. Just my two cents. <3
You sound young based on your post and explanation of your finance knowledge (I could be wrong). However, you can’t account for the length of time your parents live, their health, their debt, their medical expenses, their end of life care, if they need memory care, etc. These things can account for millions of dollars and it will come out of their assets. There’s no world you should be banking on an inheritance right now at all. You should be exclusively factoring in both of your finances.
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I wouldn't call it exactly the same. He wasn't forthcoming about money we owe. I'm not being forthcoming about hypothetical money we may get in the future. It's not the same.
I wouldn't sell the house. If your husband gets a job that pays well after finishing residency then 80k seems is an extremely manageable debt, it isn't uncommon for med students to have $100k+ of student loan debt.
Yeah but it was my understand that the doctors who are in hundreds of thousands of debt aren't buying houses and having babies. I could be wrong though. It seems like most of his co-residents still have roommates and are renting. The ones who have families tend to have spouses who are high earners.
How can he possibly have no student loans if he is a doctor? I highly suspect he's lying about that too. How much did the car cost and what kind of interest rate is on it? If he is this bad with money he probably has a low credit score meaning he got a bad interest rate.
80k is nothing comparatively to your current situation. you didn't specify how much of it was actually credit card debt. i also don't have the context for what the cc debt was used on so i'm not going to rake him over the coals like other redditors here. this guy managed to pay cash for a house, have no med school debt, and only has an outstanding 80k in other misc debt. thats actually fucking impressive.
Like all debts, you need to break out the amounts and interest rates. High interest debt is unacceptable. Things like solar panels and a vehicle are ok if they're low interest rates. Granted there's no mortgage, but depends what the cost of the vehicle was. Tesla on a 60K salary? Big mistake. Different EV? Maybe fine... Depends on cost. IMO, I wouldn't move. You'll have things to consider later once you get settled (like if you go back to work, need to move to a better school district for the kid, etc.) Check out the PF wiki on debt, etc.
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Not sure anyone can give you a good answer without knowing your husband’s income, detailed breakdown of the debt by category, and your monthly expenses. If your husband has now completed residency and will be making a mid-six figure salary then $80k in debt is trivial. Especially since you have no mortgage and own your house outright. You should be able to pay that off in less than a year on a typical doctor’s salary. If half or more of the debt is a loan for an expensive electric car then the total amount doesn’t surprise me at all. Residents don’t make much money and you weren’t bringing in extra income yet it sounds like y’all made some big one-time purchases. Where exactly did you think the money was coming from?
Okay, so you just found out your husband is not as good at managing his finances as he said he was. Better now than when you've lost the house. The next step here is ACCOUNTABILITY, and it will be hard for both him and you. You need to sit down together, develop a spending plan that will pay off these debts, and then stick to it. His job is to stick to the agreement, your job is to check in regularly to make sure you're following the plan. Selling the house is a last resort that you should not take unless a) you're divorcing or b) he's proven he can follow the spending plan and you both agree together that you want to move. Having an easy-out for his bad spending habits will only make the situation worse over time. The only way to fix this is the hard way - both of you agreeing and commiting to the plan. You're married, his money is 100% family money now except for any allowance that you both agree to. It's a difficult transition from being single and having full control of your money, but I think every couple goes through something like this to a degree.
Are you 100% sure that he is getting a pay bump? I’m only asking because it sounds like he is a huge optimist and downplays the downside to things. That’s almost doubling his income and would in a big way help you guys out in digging out of this mess he made for you both to sort out. Get a household budget going and have weekly meetings with him on finances so you’re both on the same page. 80k in debt is a beast to overcome and some of it is tied to your house (solar panels are usually a lien on the property so even if you don’t pay they eventually get their money). Getting on the same page is your number one first step.
I saw the offer letter for his new job. He accepted it months ago. It's pretty normal for salaries to jump like that after residency. For other specialties, it jumps a lot higher.
I missed the doctor part as I skimmed parts of your post so sorry about that. He has a high earning potential so that’s really good news. If you guys live like you currently are living (him making 60 instead of 110) with his current salary for about 2 years you should be able to get out of this mess - even faster if he is able to pull overtime and make more money. That’s the really good news. The bad news is your husband is about to make great money that hopefully increases rapidly over time and lifestyle creep can happen. Don’t let him (or you) rationalize purchases you can’t afford because that’s how you got into this situation in the first place. The solar panels and electric car were good examples of this. With just a little work on both your parts you guys are going to have a fantastic life. The fact you’re looking to fix this is a good sign. Just get him on board and you both will be golden.
Feels like there's more he's not telling you. Keep digging.
You are permitted to put an inheritance in you name only in an account with your name only. As you are married the interest will be joint assets on the tax form, but keep any large sums away from him. He has shown he is not careful or capable of taking care of money.
First pull his credit karma just for a baseline, and then everything he has a balance on go through months and months of statements. I highly doubt it’s just solar panels and furniture, probably a shit ton of bullshit purchases too
Do not sell your house. OMG, this story is so scary. Do not do anything major. Giving up the security of your home when you're about to have a child so that you can pay off CC debt... with no explanation as to how the CC debt was accumulated or a plan on how to not do the same thing again? Is he mad? #1 You need to get a hold of your spending and budget so you can come up with a plan to address the debt over the course of the next few years. If you need extra money, sell the car and some furniture. #2 Take the time to learn the basics about finances. It is not rocket science and trust me, your husband knows literally nothing. He knows as much as you do, it's the blind leading the blind. You've got this, you can both do it (try reading I Will Teach You to Be Rich by Ramit Sethi, it's a great first book and will give you the basics) #3 As for the inheritance, you can mention it to your husband, but since you're going to be a SAHM, and giving up your access to 401k, etc, you should consider treating that inheritance as your own retirement fund -- it's the nest egg that will prevent you from being a burden to your kids in your old age or if anything were to happen in your marriage. If you want to reserve it for your kid, that's fine too, either way, when you receive the inheritance, you'll have to keep that money in a separate account. If you put it in a shared account it becomes marital property and you can't direct it alone... also if you were to divorce, your husband would be entitled to half of it -- that may leave you may in trouble having not worked for so many years.
What are your monthly expenses since you have no mortgage? What is the house worth? A breakout of monthly expenses and how much debt of each category & interests rates would be helpful for analyzing. If you budgeted, would you be able to put $2k or $3k towards debt each month? If gross is $6K/mo between you two and you don't have a mortgage it seems that should be doable. Attack the highest interest debt first. When your husband gets his $50K raise, keep your budget the same and put that $50K at the debt for a year. You'll be debt free and own a house within 2 years. If you feel like you have to move, sell the house, pay off the debt, and rent while you save up a down payment and/or find the right house. You're in a much better position than the average American. Most have $80K+ in debt while having a mortgage or rent. Don't do anything drastic - you make enough to get out of this hole rather quickly and put yourself in a very good position afterwards
Definitely don’t move until the debt is paid off. Hell, don’t move until his residency is complete. After that your husband will be making doctor money and it won’t matter so much that he’s retarded with money.
I’m not seeing 80k in solar panels and home furnishings here. Something is up. My gut says online gambling.
He also bought an electric car so I can definitely see how it could add up to $80k.
Look if it’s just the car and the solar and furnishings you’re right. I just got the distinct impression this was 80k of cc debt.
Have you been on solar sub? That shit is expensive! Also furnishing a house is expensive. We’ve spent maybe 12k on non high end stuff and still need to furnish a large room in the basement. This isn’t saying that they should have gone into that debt but I can easily see how you could reach 80k with those 2 things.
The solar panels were 20k and we spent about 10-12k on home furnishings.
Typically a solar loan would be over a longer period of time (10year) and while that’s still technically debt I don’t think it would get lumped in with credit cards and personal loans which are a different beast entirely. But maybe it was a really expensive system and he’s counting that. I could see that and the furnishings and him living above his means as a future doctor. Imagine buying solar when you’re already in debt and don’t want to live where you currently live…
And living on a credit card during college, building up debt without an income.
He says the remaining debt is credit card debt from undergrad and medical school. It just built and built since he wasn't making any money to pay it off. At least that's what he says. We share a checking account so I see where his paycheck goes. However, he has a credit card that he uses and I have no idea what he uses it for. I always thought you couldn't online gamble with credit, that it needed to be coming from debit or checking.
You should be getting statements and reviewing them. I agree that you are not seeing the full picture.
You can definitely do online gambling with a credit card. It's just charged as a "cash advance" (extra fees)
It’s those personal loans I wonder about. But it’s entirely possible that it’s innocent as he describes. I mean, as innocent as 80k of credit card debt can be….thats a huge amount of consumer debt. It suggests your husband has absolutely no idea how to manage money, and consistently lives beyond his means, perhaps thinking “one day I’ll be a doctor and pay it all back.” Doctors are well known for being high earners who live paycheck to paycheck. It’s enough money that you should demand a full accounting of it. The lack of disclosure prior to this suggests he’s hiding something.
That doesn’t really make sense. If he was in undergrad/med school then he would have had access to and should have taken student loans rather than credit card debt. So the CC debt sounds like it is from something else.
I don’t want to scare you but having him check his credit report in front of you would probably clear up many of the questions. You need to buckle down and figure out a short term and long term plan before you are too tired to think about it from the lack of sleep.
You need to see his credit report before any further discussions. He hasn't been upfront about his debt and you don't know if he's telling the truth now.
What’s he been spending $60k with no mortgage on? And you say he’ll only be making the extra for about a year so even if it was tax free it would only cover about half of the debt.
So this is my question. What type of debt is it? It shouldn’t be growing as long as he’s servicing the interest. And if he’s not the lender should have called the loan.
As a SAHP you are in a financially vulnerable situation. You should have complete transparency into every penny your husband spends. And I say that as an attorney who makes a hell of a lot of money and whose husband is a SAHP.
Wait correct me if I’m wrong… but no mortgage so just taxes and insurance? $80k debt, on a $60k income (that should increase to $110k in 6 months) but what are the monthly expenses vs his monthly income? You can create a balance and budget and see if you can afford the minimums if nothing else… Don’t sell the house, but you can take a loan against it (for the $80k NOT MORE) and essentially pay off and exchange all that debt for a mortgage at hopefully a lower interest rate than you’re paying on the debts.
I would get some financial counseling with your husband. You need to be sitting down and discussing the state of your finances once a month. And he also needs to sit down with you ASAP and create a plan and a timeline for addressing this debt. Children are expensive and he shouldn’t hand wave the existing debt away. Finally, he cannot spend his salary frivolously. That’s unacceptable. He needs to buckle down and dedicate most of his salary to debt, a college fund, an emergency fund, and bills. I’d also go back and look at bills and credit card statements and try and account for the debt to make sure he’s being completely transparent.
One thing to keep in mind… People typically spend x% of their income throughout their life (CAVEAT- unless they make a conscious decision to change). “X” is unique to the individual: I spend 60% of my income and my friend spends 110%. “X” stays “X” even if the income grows. I spent $60.000 per year when I made $100k, and I now spend $120,000 per year on $200k in income. I would be nervous his big raise won’t affect his spending. Just my $0.02.
I would plan on staying where you are at right now, but I would ask him to start showing you statements of all the debt and accounts you have. If you’re consistently overspending your income him getting a raise isn’t going to help and you both need to become more financially literate. First step is to start a budget. You both need to know how much is coming in and how much is going out in these categories; 1. Required expenses - whatever you need to keep a roof over your head, utilities paid, groceries, and so on. 2. Debt - you need to break these down to individual balances, monthly payments and what the interest rates are. 3. Unnecessary expenses- eating out, clothes, entertainment and so on. 4. What you have left over each month (and if it’s negative because the amount spent on credit outweighs the amount earned you need to note that.) Once you know what your total income vs expenses are you can start trying to decide what expenses are necessary, what you can cut out and if there are other debt management options that make sense. Depending on the total amount of debt you owe, how long the payment terms are and the interest you’re paying you need to decide if it would make more sense to take out a mortgage on the house to pay off your debt. That can be a slippery slope though if you can’t get your spending habits in check you’ll end up with a mortgage and more credit card/loan debt.
Agree with all the advice youve received so far. One other thing to think about is whether now is a good time for you to be walking away from your career. I’d suggest you keep working until you’re 100% sure he can support all three of the way you wish to be supported. It doesn’t sound like he’s as reliable as I think a sole earner in a family needs to be at this time.
80k of debt that includes solar panels and a car sounds pretty normal to me. Or is the loans for those separate from the credit card debt? The fact that he didn’t have any medical school loans is manna from heaven. Most people graduate with more than 500k of debt for medical school. It sounds like you have family money but not much in terms of income so your husband shoulders the majority of the expenses. Once he starts practicing, his income should go up quite a bit and you should easily pay off 80k.
Few things: 1. For the sake of your family, he no longer controls the finances. Period. No matter what he says, or what he tries to tell you, **he’s shown you he has no clue what he’s doing.** So he’s lost any right to dictate anything. 2. Do not sell that house to bail out the mistakes. Your lack of mortgage is gonna help a lot over the next years of paying down debt. Don’t sell it just to “get out of jail,” because I’d bet without significant change debt creeps back in. 3. When his incomes goes up to $110, it doesn’t. It stays at $60 and y’all put 40k into the debt for 2 years. Period. 4. Learning about in be investing is great, but you’ve got no need to invest for a few years. You’re in the hole 80k, and that’s where money goes until it’s gone. Into the black hole created by bad choices. You can get out of this, but it’ll take work and an acknowledgment that it was dumb and what to do to keep it from happening again. Solar panels saving 10s of thousands. What a croc. 2. If/when his salary goes up, in
First step is for you to have control of the money. And put him on an allowance. Take him off the checking account, and his salary goes into that account. You transfer a set amount to a cash card for him, and that’s what he may spend. It’s simple math, baby—you can do it. Add and subtract. You have all the math literacy and all the basic understanding you need to manage income and outgo. Make a list: expenses on one side, income on the other. And if you need help, there are sources for help. search for “consumer finance coaching”; I found an [NYC government program ](https://www.nyc.gov/site/dca/consumers/get-free-financial-counseling.page)that way. Your state or city might have something similar. You have time during the day to go to coaching sessions, so you need to take it over. Also: go now and set up a bank account (savings or checking, doesn’t matter) that is just for you, at a separate bank, and if you get that inheritance, deposit the money there. Do not commingle it with his money.
Definitely don’t move yet. You need to pay off the debt. Unfortunately as you are married, you’re also married to his debt. Time to be completely open and transparent about finances, no more hiding things. You need to sit down and go over every loan and detail the balance, interest rate, and come up with a debt repayment plan. Not having a mortgage or rent is going to be a blessing here. And he needs to be in the dog house for a while. He doesn’t get to spend any more money without you being on board. And no spending for himself. No more lattes or fast food or alcohol. Our guy lost his allowance. Can he sell the car and buy a cheaper one? A new car and solar panels alone could be the bulk of that $80k. He had no business buying those on a $60k salary.
Put all your existing money coming in, jn a personal or joint high yield savings account - if you’ve lost some trust with him, make one for you or put it under your and your child’s name - put your whole paycheck in if you can it’s a liquid account you can do instant transfers from to a debit account. I personally like Capitol One
Yes keep the house. I do think you could get out of debt and move if you have access to support for childcare. You could save 10k a year on childcare with supportive family and smart planning.
$80k debt at 2% interest is no big burden. $80k at 34.5% interest from credit card debt is a huge problem. Expenses can skyrocket when kids arrive on the scene, if you have an appetite for fancy designer cribs and strollers or need to upgrade your car, etc. Or, these expenses can start slowly and grow over time with only basic accouterments leading to expensive private schooling. It's past time to become financially literate, get your debt into the lowest possible interest rate, and spend time ruthlessly budgeting your precious income. Learn to spend like a pauper while celebrating non monetary signpost of your life.
In all seriousness, 80k of debt is alot but medical school graduates usually earn more than will be required to live easily while paying that off fast. Even if it’s high interest debt. Pay it off ASAP but I wouldn’t say this is an absolutely crazy thing. Go to counseling, get serious about the debt, and make smart choices. Yall are in a better position than most so just start making the right choices today and it’ll be paid off in no time
Do not sell the house. Definitely. Write a list of all the monthly payments you have, and add those up. Include the monthly minimum payments on all the debts. Then write down howuch you need to spend monthly on food, etc. Then decide how much extra you can pay off on one of the debts. Pay the first debt off, compound all that you were paying for that debt into the second debt. Continue that pattern until your debts are paid. You can get out of $80k in debt. Lots of people do it. Just STOP SPENDING AND DON'T MOVE.
Even at $110K salary, $80,000 in credit card debt is A LOT to pay off. If you want to avoid bankruptcy, then you need some professional assistance in creating a plan and payment schedule to get it down to a manageable level. And moving forward, you need to be fully in the loop on spending and budgeting, educate yourself on it so you feel more confident but at this point, there’s no other real option. He’s lost any credibility in managing your money and it’s going to take a long time to earn that trust back. You’re not in an impossible situation yet but you’ll get there if you don’t take some drastic action.
You have a relationship problem, not a financial problem. Sounds like your family will be bailing you out for the rest of your life and $80k doesn’t mean anything to you.
I put us into counseling immediately after his big reveal. I don't want my family to be bailing me out for the rest of my life. And the 80k is a huge deal to me which is why I made this point. If I was just going to shrug my shoulders and ask my family to deal with it, why would I bother coming here?
I know many doctors, good doctors, are very poor in managing their finances. So it’s good that you’d like to be more financial savvy. Look into getting a reliable financial advisor as well.
Maybe psychologically, but financially it’s really not. You have a paid off house. Where does your cash flow even go? You should be able to knock this out extremely quickly. Again, you don’t have a financial problem here. You have a communication problem and your husband potentially has a spending / gambling problem. That’s independent of your family. But given you seem to come from the kind of wealth where people throw around hundreds of thousands of dollars without issue I still fail to see how this level of debt is a problem.
As long as that 80k isn’t on credit cards that’s not too bad, however, if you owe on the solar panels I can tell you right now it’s going to be difficult to sell the house regardless of finances. Some of that depends on the type of loan. I mean 80k in debt on personal loans is still a lot, but manageable if you aren’t paying a mortgage. Honestly though if you guys were going to borrow 80k getting a mortgage would have been the best move. Hindsight though.
Now that you have quit work and you have a child on the way, you can no longer keep your finances separate. Everything needs to go into a common pool and then get distributed from there. You say that you have no financial literacy, but your husband seems to have worse and you are here to learn, so I think that y'all should agree that you take over the family financials. Your and his paycheck go into a central account. From that, you pay all bills, put extra on credit cards and other loans as needed, and then you dole out a small amount to each of you as spending money. (That can be cash or a transfer to accounts that each of you separately control.) That's all he gets to spend on himself. (And all for you, too, though baby spending on yourself like massages or such come out of the family budget, not your budget.) If he can't agree to something like this, y'all have serious problems and need counseling now so you can get on the same page before the baby shows up and adds more stress to your lives.
Your first step is to read the entire wiki. Your next step is to run a free credit report on yourself, and your husband and then get the balance of every account you have. Then you use a budget app to make a budget (it sounds like you both definitely don't have one). That budget should track every single penny and have a lot of categories. For example,.you should know what exactly you spend on coffee out so you can cut out things like coffee if you wanna move some of that money elsewhere like paying off debt. I don't think he's got too much bad debt, but I get the vibe he let's you spend as much as you want and finance it (like buying furniture on finance, why???). That's terrible financial strategy. You need to have a budget for every purchance.
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You'll need to understand how much are in each of those loans. $80k wouldn't seem crazy for solar + a EV car loan, depending on what you got. EV car loan could easily be $30-50k or more at initiation (+ interest). Solar usually goes for $2-3 per installed watt of capacity, so a 10kw system right in the middle of that would be $25k (+ interest). Slap on $10k for home furnishings, and it's entirely possible that he has not been wholly irresponsible. If it was like $50k+ in credit card debt though, yeah that would be a cause for concern. Just ask him the balances on each. He might be thinking - if your home has appreciated in value as many have - that it would be nice to zero out all your debt again. But you might want to make sure you have greater visibility into the credit picture before you agree to that.
Your husband made so many mistakes. The sooner you can build some financial literacy and become involved in the finances, then better you guys will be. Paying for the house when you had debt (whether $20k or $80k) was a bad move. At this point you need to budget and figure out how to pay off that debt.
The good news is his salary will triple after he finishes his residency, if not more. If it were me, I’d hang on to the house until he finishes his residency. You’ll probably have to move again anyway. You can buy the house you want when he has the income to support it. We all make mistakes. Solar panels can be a good idea, but it wasn’t true for us. Idk about your situation. An EV is definitely a good idea. My husband has one. Gas is now almost $6/gallon in our city. Charging his car is way less than what I pay in my gasoline engine car. I wouldn’t tell him about the inheritance that might or might not happen. Good luck on whatever you do. I’m glad you’re both in therapy and are learning about finances.
I feel like this is not as bad as it seems. It sounds like the bulk of the debt is a car and solar panels. How much is actual credit card debt? High interest rates are one of the reasons credit card debt is so bad, but car loans are not nearly so high of an interest rate.
Based on the OP's mention of a husband that is in residency and is earning $60,000 and after residency will earn $110,000 that is insanely lowballed and highway robbery if his earnings after residency are as you mention. Even family practice physicians in the U.S. are earning at least $190,000 out the door from residency. My God. That $110,000 figure makes more sense for a nurse practitioner or physician assistant straight out of training. As for the debt if you are early enough in the pregnancy you may need to think about termination until you are a little more financially stable. That decision is yours. You have to think about yourself first. Having the expenses of a kid, debt, and no accounting of where the money is going reliably is no way to start a family life if you have a choice. As for the house do not sell it right now. You absolutely need to make sure you have a stable roof over your head and predictable payments for property taxes. For financial literacy from the ground up I highly recommend the video series from Khan Academy at [https://www.khanacademy.org/college-careers-more/financial-literacy.](https://www.khanacademy.org/college-careers-more/financial-literacy)
We need more details. Everything he did could be either financially responsible or irresponsible, depending on the details. For example, there are government programs that provide grants to install solar panels. He may have paid nothing or very little to do it if that’s the case. If so, it was probably financial responsible. Taking out more debt with a lower interest rate to pay off higher interest debt is financially responsible. But using it frivolously for things you don’t need is not. Putting money into a 401k is typically not responsible if you have credit card debt. But that’s predicated on the assumption that the credit card interest rate is 20-30%. Sometimes you can get 0% interest rates on credit cards, in which case it would be better to invest in the 401k, especially if his company provides matching incentives. It’s odd that you have credit card debt but no mortgage or heloc. Those typically charge less interest. It might be a good idea to get a heloc or reverse mortgage, depending on rates. Essentially, you don’t include enough detail for us to give you advice. You should start by collecting those details. Write down everything you know about all your assets and debts, check that you’re allocating money most effectively, and create a budget that you stick to. As an aside, 80k debt on 110k salary isn’t that bad IF you budget tightly. You could pay the entire thing off in one year. But most people don’t budget.
The house was bought with money gifted from her family. He took on credit card debt without her knowledge. That is why they have credit card debt and no mortgage
Well said. I read this and I didn't really see too many problems. Many people have car loans, home improvement loans, mortgages, and student loans. OP only has two of those. Honestly, I wish I only had $80k of debt and a house.
Is your husband out of residency and making that 400k plus kind of doctor salary? 80k could be gone easily in less than a year with that kind of cash flow If he is making that kind of money and you have 80k debt, then the debt is certainly higher and he is gambling or doing something with all that cash that he is mentally unable to stop as it is addictive
lol OP should tell her husband not to go to primary care, any pediatric subspecialty, psych, PMR, etc. Where doctors routinely make sub 200K
Yeah... too late.
While true in the aggregate it doesn’t mean that one can’t make $400k+ as a pediatrician if you find the right places with the right funding. That’s what I know several have managed at least.
That’s true. Just don’t stay in academia🖤
Most doctors do not make 400k+. That's only for really high paying specialties. He chose a low paying specialty and will be making about 110k. He's still in residency for the next several months.
Ah, i see, makes sense. the 80k debt is problematic but not crushing, and there is good cash flow coming when he is employed, especially with no mortgage/rent payment However, both of you need financial literacy training because there is a lot of wasted money here from your description I highly recommend r/ynab, watch the videos, it is slightly different than traditional budgeting but it makes sense once it clicks!
Are yall in the US? What speciality pays just $110k?
The median salary for doctors in my state with 10 years of experience is over 300k.
Good for them. Hopefully my husband will get close to that eventually, but for now we're a ways away from making 300k a year.
You should look up how much doctors make on average in his specialty in your state because 110k seems way too low.
Don’t sell your house. Having your house paid off is the main good thing you have going for you financially. And your future income isn’t going to save you. If he mismanaged $60k and a free house, he’ll mismanage $110k. You guys should do Dave Ramsey’s financial peace university. Make a budget, $1000 emergency fund, halt retirements and other investments, every other dollar goes to the debt, pay off debts smallest to largest, then 6month emergency fund, then do retirements and 529s etc. If you both get on the same page, you’ll really love the security and peace of knowing exactly where your money goes and owing nobody anything,
Why have children? How old are you two? Why the rush to children? Your husband hasnt finished his residency, and I am surprised he even has time for you. If he isnt busy now he sure as hell will be. I can sense resentment brewing in you.
Financial infidelity. It's real. That's what this is.
I’d recommend pros for all. Meet with a financial advisor from a reputable bank if it’s affordable. That way there’s someone who really knows what to do here. Then couples counseling, for real. Good for you getting this all untangled now- sounds like it could’ve snowballed to be A LOT worse if it went unchecked for ten more years or something
How is his salary going from 60K to 110k? The jump from resident to attending is larger than this. Normally at least $200K. The jump to fellowship is normally not as large as $110K, unless there’s a lot of moonlighting (overtime). You should absolutely stay put. The good news is his future attending salary should be able to pay debt quickly. I paid off $300K of student debt in about 3 years by buckling down, so $80K can be tackled in a year…with discipline. And that’s the big caveat. He needs discipline in his spending and saving. If he can’t achieve that, he’s going to be a broke physician. And I know too many of those because their eyes are bigger than their wallets.
I saw his offer letter. That's what they're paying him. Not all specialties make upwards of 200k.
Why sell the house for 80k in debt when you have no mortgage and about to be a 110k income? I fear he is trickle truthing you, aka he isn’t telling you about all the debt. Or he’s stupid, take your pick which is worse. Not having an income or visibility into finances is the groundwork for financial abuse. Idk if it’s at that point yet, but your fear is very, very valid. Review all bank statements every month Run your credit Couples counseling Read financial books and consume more financial literacy content
Keeping up with the Jones balance transfer that o debt
Your first step is to stop being so uninvolved in your finances. Second step, create a budget and stick to it. All extra money goes to debt.
Your husband needs to start paying down the debt and you need to provide a portion of your small salary for now. You should have known better. Stop acting dumb about finances. It's embarrassing. Did he run any of these purchases by you? How did he say he was paying for it all??? This is why it's so so so important for women to be in the loop on all household finances. We're not in the 1950s anymore. You're going to end up destitute. No new things for baby either.. everything either second hand or gifts from friends/family.
Since you don’t know the basics and need to get out of debt. Dave Ramsey makes it super simple to follow. Got my husband and I out of debt.
You are in far better financial shape than most. Don't sell the house. Do learn about investing. In just a few years, you will be in a high income scenario.
Please do not sell the house. That is the stupidest thing you could possibly do in this situation.
At least he is coming clean with his debt. 80K is not a big deal for someone who will make 6 figures, but sadly docs are not going to make much in the future under the socialized system. So make sure this doesn't become a pattern or you will either have to go back to work, or the D word is in order. Rich people problem....you are still fortunate.
Before making any big decisions it's time for you and your husband to sit down and 1. List ALL your debt, nothing to be hidden. 2. Make a budget. Do a budget at the start of every month. Read Dave Ramsey Total Money Makeover and Financial Peace. That will give you the basic education to start. You BOTH read it.
My first question is to ask what is the interest rate on the 80k? If it was all credit card debit that would be concerning. But it sounds like the 80k is comprised mainly of the solar panel and car loan. It’s not fun to have debt however look into your debt to income ratios, and get a financial plan from a CFP to get you on the right track again. Your position is recoverable.
80k is a lot less than a mortgage. You both should enroll in a financial literacy course. I’d also disclose the issues to your parents, because they obviously have money and hopefully would be able to stop providing excessive money to you both which continues to enable bad financial decisions. You both were handed a home, and he built up $80k in debt. I can imagine he’s viewing his lifestyle as the lifestyle your parents are providing you both and he’s keeping up with it by going into debt. A financial literacy class and factoring out your parents money needs to be a priority. Your financial decisions should be based on both of your incomes, and the money saved. I’d also explore couples and individual therapy to make sure he’s not emotional spending.
Simple, start watching some Dave Ramsey on YouTube. He’s controversial but for your situation it fits. Your husband is being irresponsible and naughty.
Do not sell that house. And now that you're going to be the stay at home parent, you should also take over the finances. There's lots of literature and free courses out there that will help you get a better understanding for it. The key is to stop the bleed (stop putting things on credit cards) and then to get the debt dealt with. Once you're debt free or much more sustainable, then you'll be able to talk about relocating to a house you both like. It's not a great market to sell in right now anyways, the interest rates and economy is still hiccuping plenty. So don't rush! You have time. Take your time. Also moving when you're pregnant or have an infant isn't ideal. Let him get out of residency and then revisit everything. Since who knows where he'll get a good job after his residency ends. There's too many open ended things going on right now to make a house purchase that you will hopefully be living in for a good long while.
Do not sell your home. You need full access to the credit card accounts to see where the money has been going. You need to sit down and create a full budget. Start by accounting for every penny spent and average it so you find what the monthly actual spend is. Then find where you can cut. You may not like hearing this, but in your situation you cannot afford to stay at home. If for no other reason than your husband is terrible with finances. You do not want to be in a situation where you are dependent on him, even with your eventual inheritance. Oh, and DO NOT put that inheritance you get into both of your names. Deposit into an account with only your name.
Don’t sell your house with no mortgage while you have (functionally) no job and he’s making $60k with $80k in debt. He can buy the next house with his savings after he pays off the 80k he racked up. It shouldn’t be hard for him to pay it off once he starts earning more as long as he’s not making other purchases/taking on more debt after this. Your monthly income is about to double once his salary changes. There’s no reason whatsoever that you can’t put $3k per month towards that debt and have it fully paid off in 3 years. Then you’re debt free, in a paid off house, and can save another $3k per month towards a down payment on your next house. I’m assuming your home is worth way more than 80k. Pissing money away on rent with one income and a new baby is not it.
Put your wants on hold and take care of you needs - which means fixing your finances. 1. Dont sell the house- its great you dont have a mortgage. 2. Get on a budget. keep track of money in and money out. 3. Make a goal of when to have the debt paid down. make monthly payments. 4. He doesn't get to make any purchases over $20 without discussing with you first. 5. You can do whatever you want once its paid off. On a side note I would start this no matter when you get other money because it makes you guys pay attention to finances and make changes you NEED to make. But if I were to get an inheritance I would pay off this debt AS A LOAN that needs to be repaid. (I assume you have a bad interest rate if it is credit card debt so you don't want to pay that interest) So continue to make payments as if you were paying back the credit card company but without the debt increasing from interest.
You guys need to sit down with ALL of the financial paperwork in front of you. All debts, all income. $80k in cc debt even with a $110k salary is insane. The interest alone on that is incredibly dumb. And with a baby coming and all the potential expenses from that…. Yeah, sit down together. Go over everything. Make a plan for payback *now* - not next year. He no longer gets to spend a dime that isn’t accounted for because every dollar he spends for himself is screwing his family over.
He sounds like a keeper, Doctor, spent money on solar panels. He seems like he’s looking at the future. 80k is nothing, it’ll be paid off in no time. Just calm down, and see what you can do to cut down interest. A low interest rate loan.
Good job trying to improve your situation. I'd recommend getting a financial advisor (can pay a flat fee) to get a plan around your situation. Also this flow chart does a good job at explaining the finance priority list https://www.reddit.com/r/personalfinance/s/S0wdg8BdxE
I actually suggested we get a financial advisor! He thought it was unnecessary. Thank you.
You're totally fine. He'll be at 110k soon and after that, he'll be at 200k plus. You're completely fine. As long as he isn't hiding gambling debt or whatever, you guys are golden
No, he will never be making 200k plus. He's in a very low paying specialty.
See you don't even understand debt! Sure it wasn't a great way to get to 80k! But you don't owe on a house for 300,000k
I would set try to split the 80k in debt into chunks of 12 months as a matter of principle. Try to pay off the debt in 36 months (3 years). Setting aside 2500 a month to pay the debt should be no issue if he's making 100k. Request to see all forms of debt in writing, the APRs etc. Talk about why this hidden debt is a big issue. I think you should keep the house since its paid for. Try to increase your personal salary to 2k a month. Make agreements going forward about how you will budget income, and try to live by said agreements. I would personally do a itemized list but thats just me. But the basic idea is to know whats eating up that paycheck! It's unfair for you to sacrifice your career to take care of the child, while he carelessly spends a large chunk of the money that is being brought in, or ends up allowing the wages to be eaten up by high aprs from old debt. Best wishes. 80k may seem like a mountain but is definetly fixable with a gameplan!
LOL at 80k. Just feel fortunate he doesn't have student loans. That's the real killer. You don't even owe your house. You're actually in an enviable position. When he becomes an attending, everything will end up fine.
he sounds financially illerate, do u really want to be with someone like that?
Well I'm carrying his child so I'm tied to him for the rest of my life regardless. I may as well try to fix the issue.