Dear Dave,
I went through a divorce earlier this year, and I was granted custody of our children. They’re 13 and 18. The house we live in is paid for, and it’s worth about $450,000. I also don’t have any other debt. My exhusband has been very good about paying child support, and I have $175,000 in savings. Should I be investing at this point?
Michele Dear Michele,
I’m really sorry to hear about the divorce. I know the whole situation, regardless of the financial situation, is very hardonyouandyourkids.Do yourself, and them, a favor, okay? Make sure you spend a ton of quality time with them. Hug on them a lot, pray and let them know how much you love them every single day.
Now, let’s get to the nuts and bolts of your situation. Fortunately, it sounds like things are pretty good financially. At the very least, you’ve got a net worth of over $600,000. But here’s the thing. I’m sure the trauma of having your life upended is still very painful. That being the case, I wouldn’t recommend making any big decisions now. It’s never a good idea to make important, long-range plans when your emotions are messed up.
When it comes to the money you have in savings, my advice is to just let it sit there a while. I know it won’t make much money, but you won’t lose anything, either. Then, in a few months when your emotions are in a better place, you can look into investing some of that into good growth stock mutual funds. Find a quality advisor, one with the heart of a teacher, who can walk you through the process and explain your options and investments in ways you’ll understand completely. Knowledge has a way of erasing fear and uncertainty.
Finally, at some point you’ll need to take a look down the road, and decide what you want to do with the rest of your life. Do you want to go back to school? Maybe start your own business? Take a little time later to allow for thought, education and deciding what you want out of life now. But above all, Michele, please spend lots of time with your kids. Also, if you’re not currently in a good church, I’d suggest finding one nearby. Those things will help so much with the healing process.
God bless you all.
— Dave
Dave Ramsey is a seventime #1 national best-selling author, personal finance expert, and host of The Dave Ramsey Show, heard by more than 16 million listeners each week. He has appeared on Good Morning America, CBS This Morning, Today Show, Fox News, CNN, Fox Business, and many more. Since 1992, Dave has helped people regain control of their money, build wealth and enhance their lives. He also serves as CEO for Ramsey Solutions.
Dear Dave,
I thought I was going to get control of my money and make a lot of other positive changes in my life this year, but very few of the things I wanted to accomplish happened. I started strong, and began with serious intentions, but somewhere along the way I lost focus. Can you give me some advice for making and sticking to my resolutions in 2026?
Isaac Dear Isaac,
Lots of people make big promises with the best intentions on December 31st. It seems everyone comes up with a laundry list of New Year’s resolutions, but research shows very few people actually achieve their goals. If you’re ready — and I mean really ready — to reset your life and succeed with your New Year’s resolutions, here areafewsimple,provensteps that’ll help.
First, write down your top goal. Pick the resolution that means the most to you and write it down. You’re more likely to succeed if you can focus on a single goal, and you have a greater chance of achieving it if you write it down—onpaper,onpurpose. Andmakesuretheresolution you choose is very important to you. Writing down a goal just because it’s what someone else is doing, or because it sounds like a good idea, isn’t good enough. If your goal isn’t yours, it won’t happen.
Second, set benchmarks. Let’s say you want to pay off your credit cards before July. You need to make that goal measurable throughout the year by setting benchmarks. If you owe $5,000 on your credit cards and want to pay them off in six months, you need to pay about $833 towards them every month. Write your benchmark down beneath your goal, and make a plan for how you’re going to get it done.
Three,findanaccountability partner. A great accountability partner isn’t afraid to ask how your goals are coming along, and they’ll call you on it when you’re slacking. If you set a financial goal, a good accountability partner isn’t going to be the friend who always asks you to go shopping. Studies have shown that having a strong accountability partner increases the likelihood of achieving a goal dramatically.
And finally, make sure you reward yourself along the way. It’s tough to stay motivated when hitting your goal takes a while. Lots of folks start out at full speed, only to see the momentum disappear over time. You mighttreatyourselftoanight at the movies when you’ve paid off the first $1,000 on your credit cards, or maybe a nice, new shirt when you’ve paid off half the card.
Sometimes life doesn’t work out the way we think it will, Isaac. Our priorities can change, and our goals may change, too. If that’s why you didn’t make your resolutions happen this year, that’s fine. Just don’t make the mistake of thinking it’s too late to change and improve your life!
— Dave Dear Dave,
I own a duplex that has an opening for a tenant, and an old college buddy wants to rent the apartment. He has alwaysbeenagoodfriend,but I’m a little worried about the possible effects on our friendship if business is brought into the picture. Do you have any advice?
Justin Dear Justin,
You can make this work, but you’ll both need to be careful. It’s going to take a lot of honesty and maturity from you both.
Doing business with friends always comes with the risk of running into a situation that can damage the relationship. Am I saying never do business with friends? Of course, not. I do a lot of business with friends. I just make sure all thespecificrequirementsand expectations of the business relationship are laid out in clear detail, in writing, and fully understood by both parties before a deal is struck.
Sometimes friends have unrealistic expectations when it comes to doing business together. The friend who’s renting may think the friend who is the landlord will give him a pass if the rent is late, and on a dozen other things. The friend who is the landlord may think the renter will be a perfect tenant, because they’re friends, and find out the hard way his buddy’s a slob who doesn’t respect and take care of the property. All these things should be ironed out ahead of time and before the agreement is signed.
You might want to make sure, too, he understands the need to come talk to you if a situation arises where he may be late with a payment, or not be able to pay the rent one month. Most issues like this can be worked out, but he needs to understand — and it’s your job to tell him ahead of time, in a kind-but-firm manner—you’renotrunning a charity.
Just be friendly, straightforward and businesslike. If you have to enforce the rules, do it consistently and with fairness. Likewise, if a situation pops up where a little grace and understanding are appropriate, provide those as well.
— Dave Dear Dave,
My husband is a union member and works at a paint factory near our home. His union’s current contract will expire in nine months. We have about $27,000 of debt left to pay off, and he makes a little over $80,000 a year. I’m nervous because his slow season is coming up between now and then. During this time, he usually gets about half the hours — and, of course, less money — than he does during the rest of the year. I’m a little scared, even though there hasn’t been a strike in the last six years. Do you think we should go ahead and pay off our remaining debt or hold onto every penny in case they walk out?
— Cheyanne Dear Cheyanne,
I’m going to tell you something that might just blow your mind: You two can pay off the debt and have some money set aside to live on in that length of time. If you do that, you’ll actually be more ready for a strike than ever before. You’ll both have to be on the same page financially and do things with a sense of urgency,butrightnow,Idon’t think you’ve got too much to worry about.
The likelihood of them going on strike is pretty low. Chances are, they’re just rattling their sabers and talking big to posture for the negotiations. Most factories are behind right now, and the last thing they want is to get even further behind. Everything has been so screwed up by COVID-19 that unless the union demands some completely ridiculous stuff, things will probably work out fine.
I think you guys are going to be fine, Cheyanne. Shouldyoubeintentionaland thoughtful about the situation? Absolutely. It’s always wise to look ahead and plan for the future. Getting that debt paid off and saving up a bunch of cash will give you real peace of mind.
— Dave Dear Dave,
I’m coming up on a transition phase in my life. I’ll be leaving the military soon, and I’ve been evaluating my living situation once I am out. My parents said I could live with them for a while, but I am not sure that would work out well. I have done some research on renting versus buying a home, but I understand that you hate VA loans. Can you clarify as to why you feel this way and give some advice for a person in my situation?
Tyler Dear Tyler,
Hate might be a strong word for how I feel about VA loans, but there are some thingsyoushouldknowabout them. Number one, VA loans are usually more expensive, with the interest rate and all the fees, than FHA or conventional loans. Number two, the reason most people gravitate toward a VA loan is they can get a house with no money down. But if you’re trying to buy a house with no money down, it means you’re too broke to buy a house!
When you buy a house, and you’ve got no money in the bank, that house is going to be a curse instead of a blessing.Whathappensifyou buy a home this way, and the air conditioner goes out next week? What happens if your car needs a new transmission nextmonth?Mostpeoplewho find themselves in situations like this start piling on debt to fix things, and that’s not a wise answer.
VA loans and other “no down payment” mortgage loans allow you to buy a home from a position of financial weakness rather than a position of financial strength. Don’t get me wrong, I want you to own a home someday. I just don’t want the home— and a bunch of other debt stacked on top—to own you.
My advice is to rent a decent, affordable place for a while and concentrate on getting your new life and career off the ground while saving some money. You might even consider a roommate situation for a while to help cut costs. But you don’t need to be buying a home right now.
Good luck and God bless, Tyler. And thank you for your service to our country!
—Dave