Dave Ramsey says: Keep house and tighten belts with baby No. 2 on way

Dear Dave,

My wife and I are on Baby Step 2, and the only debt we have is $90,000 in student loans. We bring home about $90,000 a year.

In addition to this, we have almost $60,000 in equity in our home. We also have a toddler, plus another baby on the way.

Do you think we should sell the house, and rent for a few years, while using the money from the sale of the house to pay down our student loan debt?

— Chris

Dear Chris,

No, I wouldn’t sell your home in this situation.

You’re going to be out of debt in a couple of years or so, anyway. You’ll just have to lean into it, and make sure you’re living on a strict, written budget.

I’m talking about no vacations, and no eating out. You shouldn’t see the inside of a restaurant unless you’re working there.

And the new kid’s crib may have to come from a garage sale, but so what? Mine did, too.

Want to know something else? I survived without having a rich kid’s nursery, and so did my kids.

There’s a price to be paid anytime you decide to get serious about gaining control of your money and cleaning up a financial mess you’ve made.

You’re going to have to work like maniacs and have no lives for a while. That might even mean picking up a part-time job at night or on weekends.

You’ve got a tough couple of years ahead of you, but I think it’s worth the trade-off.

Keep your house.

— Dave

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