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Question for the Money Doctors

Question submitted on Jul 8, 2012.


My husband is 37 and I am 36. We both work. Our annual income is about $80,000. We have $20,000 credit card debt, $240,000 home and auto loan combined and owe my parents $21,000. Our financial situation has been a huge problem in our marriage and we started seeing a counselor. I always wanted to go back to grad school and the counselor encouraged me to do so if that helps maintain my sanity. I started researching schools and tuition will be $50,000+. We have 3 kids, age 13, 11 and 5. I want them to go to college. So I think my going back to school is a bad idea. But my husband doesn''t think so. I think he lacks financial common sense. But he never trust my judgement. I need a professional help.


Finances are one of the top causes for stress in relationships, and as our family matures, the more of an issue it becomes.  I can’t suggest whether or not getting a graduate degree would be the right or wrong course of action.  I can say that some that I present to are beginning to raise the issue of cost benefit in an education and what it brings to the table in the form of additional revenue streams. 

There are a few of steps you should consider to assist you in your decision making process and to reduce the amount of debt that your family has.

1.Go through your entire budget and assess Wants versus Needs.  Eliminate as many of the wants as possible.  Only you and your husband can determine what is in the best interest of the family.  I always suggest elimination of all of the wants and to reintegrate them into the family over time when raises occur and bonuses are paid.  My recipe for a raise or bonus is 1/3 to debt, 1/3 to retirement plans, and 1/3 for family activities.  The important task is to get a handle of your debt situation.  Your debt of $41,000 plus your auto loans indicates that the family is living beyond its means.  Credit card debt is expensive, and family should be paid back.  I would submit that the stress in the family would be reduced if finances were not hanging over your head.

2.Begin to craft a financial plan.  It will be well worth the expenditure to get a sense of where you are and where you are headed.  This process should focus on what is important to your family Values and Goals.  If it is focused on strategies, tactics, and tools, this is not in your best interest.  Your roadmap must be focused on the family and who you are.  From this, you can prioritize what is important.  This process will help you evaluate the merits of going back for a Master’s degree and the potential impact it would have on the family.

3.Review your plan at the close of every year.  Evaluate where you are financially this December versus the prior December.  It is easy to get lost in the day to day anxiety of finances and being tugged in different directions.  We are balancing the needs of children and spouses which only grow in complexity over time. 

4.Don’t be afraid to communicate to the family.  Change is always difficult, but by being upfront in terms of the changes that are necessary from a financial perspective, dealing directly with your and your husband’s changes will benefit by direct communications.  It is also a good opportunity for the children to learn about finances.

5.Share good financial habits with your children at the website.  A great way for the family to work together.

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