A couple in Vancouver, British Columbia, Canada can’t make ends meet, despite living off of $25,000 a month.
Eric, 41, and his wife, 39-year-old Ilsa, recently reached out to the Globe and Mail’s “Financial Facelift” column for guidance and advice on how to get on the right track. This sounds like the kind of problem that could prove difficult to find a solution for, but Eric and Ilsa’s situation is surprisingly cut and dry.
Eric, a doctor and professor, works one day per week in a medical clinic and makes $200,000 a year. One other day per week, Eric teaches at a university and brings home an additional $100,000 a year. Ilsa, a dentist, is on maternity leave. When she returns to work, she’ll bring an additional $150,000 home per year for her family.
The couple and their five children, according to The Globe, are “living rent free in a relative’s house (they pay taxes, utilities and upkeep) and ‘regret not having bought a house years ago,’ Eric writes in an e-mail.” The couple bought property last year for $1.1 million, and plan to build a large house to accommodate their children and a live-in nanny.
While $25,000 per month might seem like a comfortable living, Eric and Ilsa’s expenses put them around $6,000 in the red every month. With a $3,800 mortgage payment, $6,000 in professional associations, $2,000 in groceries and $2,000 in vacation travel included in their bills per month, the couple struggles to afford their lifestyle. They are, however, still planning to send all of their children to private school, which would cost them $5,400 a month.
The Globe’s financial guru offered some obvious, yet sound, advice to the struggling couple. If Eric worked one more day per week at the clinic, his household income would total $500,000 per year. Combined with Ilsa’s income, this would easily solve all of their problems. Other suggestions included cutting down on the $4,000 per month that they spend on groceries and vacations, or buying a less expensive home.
The Globe corrected their story following its initial run, after Eric clarified that the $6,000 they spend on professional associations is yearly, not monthly. He also said that he works up to 80 hours per week.
What do you think this well-off couple should do to ease their financial struggles?