Retired Early, In Debt, No Job: When the American Dream becomes a Nightmare

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in Reader Questions

After publishing my story last week on becoming Debt Free I received the following email from a new reader.

Dear Paul,

It was nice going through your blog. I read your Quicken 2010 review. I have been a Quicken user since they first came out with it. I used to listen to Dave Ramsey on the radio all the time and wish we could get out of debt.

Here’s my story and we need help.

My husband and I closed our business 10 years ago. We invested that money heavily into real estate. At that time we had it made for the rest of our lives. We were at peace, made more money than when we were working. But, that did not last. As the commercial real estate market slumped so did our money. WE LOST OVER A MILLION DOLLARS in a 2 year span.

We also invested in residential real estate. My husband became a builder and built a one of a kind house that is now on the market because we can’t afford it.

1 house is under construction (50% complete). Bank reduced our line of credit. Lost our money in stock market. Are unable to complete this house. Since we do not have any income, my husband’s plan was to move from 1 house to another to take advantage of tax benefit on $500,000. I do not like the moving part.

Money in our IRA’s has dwindled. We both are 2.5 yrs away from getting S.S. benefits if we want to apply early.

We are asset rich but cash poor. We are living on borrowed money. My heart cries that yesterday we had to ask our daughter to loan us money for our living expenses and to continue with building the 2nd house so that it will be complete by the time our existing house sells.

Our children are grown up and living 10-15 miles away. We became grandparents last year. My husband wants to move away to a country where there is growth. I know that our retirement dollars will carry us further there but, I want to stay closer to my children and grandchildren.

I don’t like taking risks. I want to settle down into a house where I can spend the rest of my living years. Most of all I want to be debt free so that my husband and I don’t live in constant fear. We came to this country in the seventies with 2 suitcases, worked hard and lived the American Dream. I want my husband to start liking USA and wanting to stay closer to the family. He is so disheartened. Neither of us have a job. I work part time (6hrs/week), not enough to put food on the table and pay necessary expenses.

I do not know why I am telling you my life history, but I feel that there is a connection. Good income, extravagant habits, husband & wife feel differently about money and having different spending habits. Most of all, I liked that your wife said you both are communicating better. That is what I want from our marriage of 30+ years.

In our mind we have gone through all the avenues. Typically, my husband’s word is the last word. Sometimes it helps to talk to a third unbiased party. I hope you can help.


First off Sylvia my heart goes out to you, this has to be a scary time. While I don’t purport to have all the answers I can tell you what has worked for my wife and I. Yes I very easily could be your husband in this scenario.

Bridges not Walls

I think the first step is communicating with your husband. I can only make assumptions about what you have tried, but what got me really talking to Angela was her explaining to me that she was nervous and scared about where we were headed financially. The key is to frame it about how you are feeling but not placing the blame on him. We had many conversations before that turned into small fights because I felt like she was telling me I was doing a bad job. I knew I didn’t have a handle on things but I didn’t want to admit it, and her bringing it up made me immediately throw up the defenses. What eventually worked was her talking about how she was worried about things, and she just gave me a nudge towards taking the Financial Peace University class from Dave Ramsey. That seemed doable to me and I liked that it was like having a third party referee even though it was mostly a video class. Going through the process it almost seemed it was my idea so I forgot all about our initial conversation. There’s no telling if that would work with you and your husband but it’s certainly worth a shot.

Boost Your Income

I think at this point the consideration of taking your social security benefits early is probably the last thing I would be thinking about. If it’s feasible you need to bring some income into this equation from one or both of you at least temporarily until you can work a solution for your real estate plans. I understand this is about the worst time to be selling a home, especially a large one, but it’s a boat anchor around your neck. I don’t know what the financing situation is but getting out of the real estate business might be the best thing for you. This sounds similar to the Rich Dad Poor Dad inspired real estate investing and unfortunately you were caught in the bubble.

Seek Professional Help

This might be a great time to go see a financial planner or counselor of which I am not. You can find a list of fee based planners at The National Association of Personal Financial Advisors (NAPFA). Like you said having a third party to help navigate this rough waters could be one of your best investments. Another possibility is to go to Financial Peace University. You can go to Dave Ramsey’s FPU Locator and find somewhere close that is starting up a new class. If you register through the host you can usually sign up for the 13 week class for only $100 which is money well spent in my opinion. I also want to offer you a complimentary copy of the Total Money Makeover if you don’t have one, as I think that would help frame some of your conversations.

Most importantly, your situation is not hopeless. You have family around you, and however painful that might feel to ask them for money, a good strong support system is critical. If you can involve them in this process you might be stronger for it. I know now that I can have open and honest conversations with my parents about my finances as well as their own and it’s been very helpful for all of us. Hugs to you.

Reader Feedback

Do you have any advice you would share with Sylvia we’d love to hear it?

Photo by Hamed Saber.

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