Karen, from Irvine, California, called the Ramsey Show to ask for advice on her living situation. She is recently divorced and has full custody of two teenage children and currently pays $8,000 in rent on an income of $5,600.
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Dave Ramseyfamous for her financial expertise, asked Karen what she got out of the divorce.
âWe sold the house,â Karen says. “So at a bank, in a high-yield savings account right now, I have about $1.3 million right there. And I’m just trying to figure out what to do with it… I don’t really want to don’t touch it. And then I get alimony/spousal support, but it’s only for six months, and that’s $15,000 a month.
Karen said she had her car and credit card debt has paid, but feels like she’s fighting an uphill battle to make ends meet in an area where the cost of living is so high.
According to Best Places, the cost of living in Irvine is approximately 65% ââhigher than the U.S. average and 10% higher than the California average. Additionally, it costs approximately $1,128,000 to buy a home, compared to the average of $338,100 in the United States. To live comfortably in Irvine, Best Places says a family would need a minimum annual income of $216,000.
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Karen tells Ramsey that she doesn’t “live high” and lives a pretty basic life. âBut youâre in Irvine,â he replies. âYouâre in one of the most expensive real estate markets in the world.â
Throughout the call, it’s clear that Ramsey sympathizes with Karen and her situation, but it’s also clear that she won’t be able to maintain her current living situation. “I’m sorry that your husband is a drug addict, and I’m sorry that he left his children in trouble. But they can’t live in Irvine anymore. You have no money. And so, as heartbreaking as it is- he that is the best thing you can do for them is create a stable environment And you know you’re not one of them If $8,000 is the cheapest you can find there. -down, you have to go somewhere else, kid, I’m sorry.
Karen is not alone in her struggles. According to a Forbes report, around 43% of first marriages end in divorce, and this rate is even higher for second (60%) and third (73%) marriages. According to NerdWallet, the median income for a single-parent family in the United States is around $43,000, while the average cost of living for a single-parent family is $49,000 per year. Of course, these numbers vary greatly depending on where you live, but expenses are often higher than what single parents report.
With high divorce rates and single-parent incomes below the cost of living, many people face similar challenges. Ask for advice from a Financial Advisor can provide personalized advice on asset management, effective budgeting and planning for the future. Many advisors offer free consultations to discuss your financial situation and goals. Don’t hesitate to reach out to someone for professional advice – it could be the key to securing your financial future and keeping your family stable during a difficult time.
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This item Single Mom With $1.3 Million From Divorce Can’t Afford $8,000 Monthly Rent, Dave Ramsey Says It’s Time To Move originally appeared on Benzinga.com
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