Dave Ramsey
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Dear Dave,

I’m an accountant, and my company is experiencing layoffs. I just learned that I’ll be losing my job in four weeks. I’ll receive a severance check, but I have no other savings set aside. Should I use some of the severance to pay off debt, or hold on to that money as long as I can?

Frank

Dear Frank,

I’d hang on to that money and pile up as much other cash as I possibly could. Right now, the most important worries are food, lights, water and shelter. Debt is not on the list. We need to take care of your basic survival needs first and make that money stretch as far as it will go.

There are two bright spots in this scenario. One, you know the wolf is going to be sniffing around the door, and that gives you time to prepare. The second thing is you’re an accountant, and that’s a very marketable skill. Lots of companies are going to be looking for your kind of expertise as we slowly turn the corner and come out of this recession.

Here’s another thing. The better financial cushion you have during this time, the better you’ll do when interviewing for other jobs. Things will be tight, but if you’ve saved and budgeted your money well, you won’t come off as needy or desperate. You can be confident in your abilities to add value to a different company, instead of being all freaked out and begging for a job.

Then, once you’re settled into someplace new, you can start writing checks out of the remainder of the severance money and your first couple of paychecks to catch up on things!

—Dave

Dear Dave,

Several months ago, I was diagnosed with stage 4 cancer. I have about $30,000 in credit card debt and would like to continue getting my finances in order. My husband has been unemployed for six years due to his own health issues, but I do have life insurance, a 401(k) and receive Social Security. How should we handle this?

Vivian

Dear Vivian,

God bless you and your husband. I know this is a really rough time for you both. I hope you guys are sticking by each other and loving on each other a lot. That may not make these problems go away, but it will make you each stronger and bond you together in incredible ways.

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Dave Ramsey

Dave Ramsey is a personal money management expert, popular national radio personality and the author of three New York Times bestsellers.
 
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