273. "We Spend 139% of our Income and still fund our adult kids"

Ramit Sethi of I Will Teach You To Be Rich speaks with Mary and Harry, 57 and 62, who are approaching retirement while spending more than they earn every month. They have a blended family of seven adult children and continue stepping in whenever one of them needs money, housing support, childcare, repairs, or help managing another crisis.

Mary handles nearly all of their finances and feels overwhelmed almost every day. Harry’s income is inconsistent, and about a year ago, he revealed that he had accumulated $43,000 in credit card debt without telling her. Mary initially feared he was about to confess to an affair. Instead, she discovered that decisions she had been making were based on an incomplete picture of their finances.

Today, they have approximately $476,000 in assets, $499,000 invested, just $3,000 in savings, and $435,000 in debt. Their net worth is around $542,000, but their fixed costs have reached an unsustainable 139%. With retirement approaching, Ramit makes it clear that small cuts will not be enough. Harry needs to substantially increase his income, they may need to sell their home and rent, and both of them must stop treating their adult children as financially dependent.

In this episode, we uncover:

Why Mary thought Harry was confessing to an affair

How Harry accumulated $43,000 in secret debt

Why their fixed costs reached an alarming 139%

How they spend more than they earn every month

Why they have only $3,009 available in savings

Their $476,000 in assets and $435,000 in debt

Why Mary thinks about money almost every day

How supporting their adult children created more debt