My Husband Lied About Being $1,000,000 In Debt (That I Know Of)

Summary

Podcast Summary: The Ramsey Show Highlights
Episode: My Husband Lied About Being $1,000,000 In Debt (That I Know Of)
Host/Author: Ramsey Network
Release Date: June 2, 2025

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Introduction

In this emotionally charged episode of The Ramsey Show Highlights, Kathy reaches out to the Ramsey Network seeking guidance after uncovering her husband's substantial financial deceit. Over the course of their 27-year marriage, Kathy entrusted her husband with their finances, allowing her to focus on managing their household and raising their four children. However, recent revelations have forced her to confront a looming financial catastrophe that has ultimately led her to file for divorce.

Kathy's Financial Predicament

Discovery of Debt

Kathy introduces her predicament at the onset, revealing that her husband has accumulated nearly $1,000,000 in debt without her knowledge. This staggering amount includes various types of liabilities that have emerged over the past few years.

Breakdown of Debts

• Unpaid Income Taxes:
  Kathy discloses that her husband has failed to pay income taxes for three consecutive years, totaling approximately $160,000.

  Kathy (01:10): "He hasn't paid income taxes in three years."

• Credit Card Debt:
  Unbeknownst to Kathy, there is $80,000 in credit card debt from accounts she was unaware existed.

  Kathy (01:14): "There's about $80,000 in credit card debt with cards I didn't know existed."

• Mortgage on Office Building:
  A significant $550,000 mortgage on her husband's office building has further compounded the financial strain. Kathy was a personal guarantor for this loan, a responsibility she barely recalls.

  Kathy (01:18): "There's a $550,000 mortgage on his office building that I'm, I was a personal guarantor on."

• Loans from Her Father:
  In 2019, Kathy's father passed away and left her a considerable inheritance. Trusting her husband, she extended $500,000 to assist with his businesses, with promises of repayment that have yet to materialize.

  Kathy (02:57): "In 2019, my father passed away and left me a significant amount of money... I've totaled all that up, and it's about $500,000."

Potential Liability

Given that the debts are in joint names, Kathy fears she may be held responsible for half of the total debt, amounting to approximately $250,000.

Ken (04:43): "If you're going to have to pay half... you would owe $250,000 if the judge split it down the middle, is that correct?"
Kathy (04:48): "Approximately. I'm anticipating in... my lawyer thinks we'll end up finding more."

Asset Assessment and Financial Outlook

Current Assets

• Primary Residence:
  Kathy and her husband own a house valued at around $2,000,000. The house is fully paid off, having been purchased through the sale of a previous property.

  Kathy (05:25): "I think it's probably worth maybe $2 million."

• Business Holdings:
  Initially, Kathy believed her husband's business holdings were part of their assets. However, she now suspects these have been depleted or mismanaged.

  Kathy (05:33): "Well, it was all of his business holdings, but I think they're all gone from what I can tell."

Income and Employment

After 27 years of managing the household, Kathy recently resumed her career and secured a position as an appellate attorney, anticipating an income of $130,000 this year.

Kathy (06:09): "I just got a job last week."
Ken (06:11): "What are you doing?"
Kathy (06:13): "I'm an attorney."

Strategies to Address and Resolve the Debt

Asset Liquidation and Debt Settlement

Ken and Jade Warshaw provide actionable advice on navigating the financial turmoil:

1. Asset Division:
   Selling the primary residence could yield sufficient funds to cover a significant portion of the debt. Splitting the proceeds equitably between Kathy and her ex-husband is essential.

   Jade Warshaw (05:29): "You're probably gonna sell it and split the profits... and then, yeah, whatever debt you're on the hook for, you'll take that money and pay off that debt."

2. Income Utilization:
   With an annual income of $130,000, Kathy is positioned to manage and repay her share of the debt effectively.

   Ken (06:25): "Kathy, what are you going to make this year?"
   Kathy (06:34): "$130,000."

Legal Considerations

As Kathy has already filed for divorce, the division of assets and liabilities will be overseen by legal professionals. It’s crucial for her to work closely with her attorney to ensure a fair settlement.

Lessons and Future Financial Practices

Rebuilding Trust and Financial Responsibility

Jade highlights the importance of transparency and joint responsibility in managing finances to prevent similar situations in the future. Establishing clear communication and shared oversight over financial matters are pivotal.

Jade Warshaw (07:48): "Everything is 100. Like, we're keeping everything above board. We're talking about it."

Empowerment Through Education

Kathy's journey underscores the necessity of financial literacy and vigilance, especially when entrusting financial responsibilities to a partner. Ensuring that both parties are informed and involved in financial decisions is critical for a healthy relationship.

Notable Quotes

• Kathy on Trusting Her Husband:
  "I'm just, like I said, I feel like an idiot because I've trusted him with the finances." (01:36)

• Ken on Shared Financial Responsibility:
  "Money is just... it is a joint thing... everybody's got to have their brain on and looking at this because really, this is what happens when you don't." (03:44)

• Jade on Moving Forward:
  "You'll probably sell it and split the profits... you'll ride off into the sunset." (05:29)

• Jade on Future Relationships:
  "We're keeping everything above board. We're talking about it." (07:48)

Conclusion

Kathy's story is a poignant reminder of the importance of financial transparency and shared responsibility within a marriage. With the guidance of Ken and Jade from the Ramsey Network, Kathy is now equipped with a roadmap to navigate her financial challenges and rebuild her life. This episode serves as an invaluable resource for listeners facing similar situations, offering both empathy and practical solutions to regain financial stability.

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Note: Timestamps correspond to the moment the quotes were made in the transcript.

Transcript

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[Kathy]

Hi. I find myself in a lot of debt because my husband has. We've been married 27 years. Sorry, I'm rambling already. We've been married 27 years and I've always allowed him to handle the finances. I quit my job, stayed home with our four children and have just trusted him with the finances. And in the last couple of years, I've just slowly been uncovering a lot of dishonesty and finally ended up filing for divorce after I found out most of it. I'm still not sure I know everything, but I think there is close to a million dollars in debt right now and I'm afraid that I'm going to be responsible for half of it if in worst case scenario, hopefully I won't be on the hook.

[Jade Warshaw]

What kind of debt, Kathy? What kind of debt is this? Million?

[Kathy]

Well, there's about. He hasn't paid income taxes in three years.

[Jade Warshaw]

How much is that?

[Kathy]

About 160.

[Jade Warshaw]

Okay.

[Kathy]

There's about 80,000 in credit card debt with cards I didn't know existed. There's a $550,000 mortgage on his office building that I'm, I was a personal guarantor on.

[Jade Warshaw]

And you didn't know about it.

[Kathy]

I'm sure I signed it. It's my signature. But I don't, I don't remember doing that. I'm just, I, like I said, I feel like an idiot because I've trusted.

[Ken]

All right, well, hold on. Say it. While we're on this list, I want to just cover what as you of what you've given Jade so far. How much of it are you on the hook for?

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[Ken]

How much of it are you on the hook for?

[Kathy]

Well, I'm assuming all. I mean, our taxes are joint. The credit cards, some, some say they're from his business, but others say I've just started opening the mail recently and I'm seeing this the Only card I was aware of has is maxed out at 30,000. Did you. The rest are other ones.

[Jade Warshaw]

Did you know. Is there anything else on the list, by the way, before we keep going through? So so far, we're at. Well, we're not at a million yet.

[Kathy]

Okay. Well, on 2. In 2019, my father passed away and left me a significant amount of money. And he immediately started asking me for money to help with his businesses and said he'd pay me back. And I've totaled all that up, and it's about 500,000.

[Jade Warshaw]

Okay.

[Kathy]

So I'm counting that. In the debt that he.

[Jade Warshaw]

And when he was borrowing that money, do you have any idea what it was being spent on or it's just kind of that cloud of businesses?

[Kathy]

Well, he would. He would say taxes or payroll or this bill or that bill.

[Jade Warshaw]

And is there any record of that? Like, did you guys. Other than just talking about it in the kitchen?

[Kathy]

Right.

[Jade Warshaw]

Okay.

[Ken]

Well, you can probably kiss that 500,000 goodbye.

[Jade Warshaw]

Yeah, so.

[Ken]

So let's take that off the debt list just for the functionality of this.

[Jade Warshaw]

My guess is that how long has it been since you filed the divorce?

[Kathy]

Two weeks.

[Jade Warshaw]

Oh, okay. My guess is that, I mean, Ken, they're probably going to look at this and split it down the middle based on how long you guys have been married and based on that, your name's on these things. Yeah, your name is on it now, right? I do. I hate this is happening, but there's a part of this where you do have to. It's like he did these things, but you also have to own your part in it, which is, you know, he has an office building. How do we think it got there? You know, there's all these things cropping up. How do we think that we're paying for them? And, you know, here on the show, we're always teaching how money is just. It is a joint thing, that coup. I don't want to say venture, because it makes it sound business, but it is this thing that we both work together. We're both plugged in. We both are dialed in as to what's going on. It can't just be. He handles that. I handle this. Everybody's got to have their brain on and looking at this because really, this is what happens when you don't.

[Kathy]

So I'm realizing, all right, so let's.

[Ken]

Talk about how to dig you out of this. So if I'm. If I'm paying attention, I'm trying to. We're really talking about. And I think Jade's Right. Let's assume that you're going to have to pay half. Hopefully that doesn't happen. But we haven't even started this fight, so that means you would. You would owe 250,000 if the judge split it down the middle, Is that correct?

[Kathy]

Approximately. I'm anticipating in. My lawyer thinks we'll end up finding more, but yeah.

[Ken]

Are there any houses we know today? So my question is, what about your house? Is your house paid for?

[Kathy]

Okay, so our house is paid for. We put. We sold a house and we cleared. We rolled part of it over into the new house. So it's paid for it.

[Ken]

How much is the current house worth if you were to sell it today?

[Kathy]

I think it's probably worth maybe 2 million.

[Ken]

Okay.

[Jade Warshaw]

Okay.

[Ken]

That's good news.

[Jade Warshaw]

Yeah. Any other assets?

[Kathy]

Well, it was all of his business holdings, but I think they're all gone from what I can tell. But he. The problem is he won't tell me anything. He's not. I. He will not give me any information.

[Ken]

Well, it's not your problem anymore because this is going to get hashed out between the lawyers. So the way you started this call is how do I get rid of this debt? And best that we can tell, what we're operating off of right Now, Jade, is 250,000. We think worst case scenario, we can't guess what may be out there. But what we know today, how would you get out of it? And that becomes the issue. You haven't worked in how many years?

[Kathy]

27. I just got a job last week.

[Ken]

Oh, good. What are you doing?

[Kathy]

I'm an attorney.

[Ken]

No way. Well, hello. You hit that detail. What kind of an attorney are you?

[Kathy]

Appellate. So I don't know anything about this financial stuff. I'm learning, believe me.

[Ken]

Yeah, but what?

[Kathy]

Can you never be in this position again?

[Ken]

No, we're not beating up on you. We're actually trying to help you here. So my question is, what are you going to make this year?

[Kathy]

130.

[Ken]

Great.

[Jade Warshaw]

Okay, great.

[Ken]

All right. So between the house is an asset, Jade and you making 130. This is not the end of the world. That's the one thing I wanted to hear.

[Jade Warshaw]

You'll probably split the debt in some form of fashion.

[Kathy]

Okay.

[Jade Warshaw]

You'll probably split the assets in some form of fashion. Hopefully it's fair for both parties. And it sounds like there's going to be enough assets for you to clear your debt and still have a decent amount of money. My guess is something's gonna happen with this house. You're probably gonna sell it and split the profits is usually what I suggest, especially if there's not kids living at home, that kind of thing. And then, yeah, whatever debt you're on the hook for, you'll take that money and pay off that debt. And you'll likely have enough money to go out and probably buy another house outright, depending on what you choose. And you'll ride off into the sunset. And like you said, you will have learned many, many lessons out of this.

[Ken]

What's the big one? What's the practical takeaway? Let's fast forward. Let's be positive is going to be too soon on some of this, I'm about to say. But I'm leading my, my partner here somewhere. So let's assume we're all clear of all this mess. She meets another fabulous man and she's in a relationship. She's in a married relationship. What does she learn from this practically and tactically? What does she do different next time?

[Jade Warshaw]

Different. The different move is everything is 100. Like, we're keeping everything above board. We're talking about it. And anything that you have questions about, you're saying out loud. You have something to bring to the table, he has something to bring to the table. No one gets to just, quote, handle it. You know what I mean?

[Zander Insurance]

Yeah.

[Ken]

No excuse, Kathy, to not know anything or very little. So now you know and get your head up. This is not fun. You're getting ready to go through a really tough deal and you're in the middle of the storm right now, but you're going to be okay financially and you're going to be okay emotionally, and you'll be, you'll be okay long term. So appreciate the call.

[Kathy]

Okay. Thank you so much.

[Ken]

Oh, it's tough stuff, isn't it?

[Jade Warshaw]

Yeah, it is. It's just so duplicitous to be. Oh.

[Ken]

Word of the Day by Jade Warshaw. Folks use that one.

[Jade Warshaw]

You know a guy.

[Ken]

Oh, boy. On behalf of all men, I'm sorry.

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