A financial guru gave some sobering advice to an 86-year-old woman with leukemia who was struggling to pay off $30,000 in credit card debt.
When she called The Ramsey Show for some advice, a caller calling herself Joan said she had racked up enormous debt just to make ends meet.
“I’m 86 years old. I only have Social Security. I own my own home. I own my car, but I have almost $30,000 in credit card debt,” said Joan, who lives in Jacksonville, Florida.
Although host George Kamel initially expressed reservations, he told her she would have to sell her house. That was the only option.
A financial guru gave sobering advice to an 86-year-old woman with leukemia who was struggling to pay off $30,000 in credit card debt. While calling into The Ramsey Show for some much-needed guidance, a caller identifying herself as Joan explained that she had racked up a huge amount of debt just to make ends meet.
Earlier in the show, Joan revealed that she had been a single mother since she was 19 and had no savings of any kind and had never received a penny of child support.
Joan said she worked until she was 80. Then it became difficult to continue because of her leukemia, which she has had for 21 years.
Since quitting work, the 86-year-old woman has been trying to get by on just $1,200 a month from her Social Security benefits.
Unable to survive on such a small amount, Joan began to borrow money, which only added to her problems.
“The reason I have credit card debt is because I always need an extra $200 (a month),” she complained to the hosts of The Ramsey Show, a radio program and podcast about finance.
This past month, Joan itemized every expense and said, “I wrote down every penny I spent last month.”
After accounting for fixed costs, she found she was left with no more than $100 to $200 to cover essential expenses like food and gas. These expenses have both increased due to inflation.
‘I am 86 years old. I only have social security. I own my own house. I own my car, but I have almost $30,000 in credit card debt,” Joan, who lives in Jacksonville, Florida, explained to the hosts
Her limited income also means she has to rely on her credit card debt to cover unforeseen expenses, such as $3,000 for car repairs, $700 for the dentist and $181 for her dog.
It has created an insidious feedback loop, with Joan increasingly relying on debt to pay her bills, causing her card balance to skyrocket.
Co-host Jade Warshaw offered her condolences to the caller, saying: “You have no buffer.”
After the 86-year-old woman made the minimum payments, interest began to rise to the point where the debt was out of control.
According to the Federal Reserve, the average debt for people between the ages of 65 and 74 was $134,950 in 2022. For people age 75 and older, the average debt was $94,620.
Joan outlined some of her proposed solutions, including selling her 17-year-old Crown Victoria automobile, a move that would leave her without transportation.
The other solution was to sell her house and move into an apartment. Joan said moving in with her daughter was not an option.
Kamel, struggling to find a solution, asked if Joan could get a part-time job to help pay off her debts
The 86-year-old estimated her home’s value at somewhere between $195,000 and $250,000. Unfortunately, she explained, other homes in the neighborhood are worth much more because they are newer.
Host Kamel opposed the sale of the car, noting that it would not make a “dent” in her debts.
Looking for a solution, Kamel asked if Joan could find a part-time job to help her pay off the debts.
She said that she has leukemia, which makes her have less energy and therefore makes it more difficult for her to work.
Kamel had initially expressed concern about selling the house: “You have a fixed cost with this paid-for house. If you sell it to pay off your credit card debt, you’re left with costs that are constantly increasing.”
But by the end, the financial guru had run out of options and resigned himself to the idea that Joan would sell the house. ‘Look at downgrading the credit on the house and moving into an apartment where you pay cash for it, eliminating the credit card debt.’
Ultimately, the financial guru had no choice and resigned himself to Joan selling the house.
“Consider downgrading your home and moving to an apartment where you pay cash. That way you’ll be out of credit card debt.”
He concluded by recommending that she rehome her beloved pet.
“I’d rather you eat than the dog.”