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Dave Ramsey says: Selling your home isn’t always the answer if you’re out of work

Dear Dave,

My husband was laid off a month ago from a job making $80,000 a year. We have no debt except our house payment. We owe about $82,000 on it, but it’s valued at approximately $300,000. We’ve also got an emergency fund of $30,000, and I work part-time making about $2,000 a month while he collects unemployment and looks for another job. Do you think we should sell our home? We’ve also got a boat that’s worth about $18,000 we could sell.

— Sheila

Dear Sheila,

The first thing I want you to do is take a step back and breathe. Yes, you guys just hit a big bump in the road, but the good news is you’re in pretty good shape financially to handle things for a while.

At this point, I’d strongly recommend selling the boat over selling the house. Boats are a lot easier to replace than nice homes, and the process isn’t nearly as traumatic on the family.

You can also dip into your emergency fund a little bit, but for the next little while you need to make sure you’re living on a really tight, bare bones budget.

I’d love to see you not have to touch the emergency fund, because he’s gone out and found at least a part-time position while he’s searching for something in his field. I know that’s tough to do once you’ve gotten used to making $80,000, but there are jobs out there that will help you guys get through this.

As long as he’s being diligent in seeking a new job, and you’re budgeting and watching what you spend together, I think for now you should keep the house. God bless you both!

— Dave Ramsey

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