Ramit Sethi talks to a couple who took a $75,000 pay cut, bought a house anyway, then added a $220,000 pool and construction project. They ran out of money, maxed credit cards, and borrowed $100,000 from family to cover the gap.
You took a $75,000 pay cut. You bought this house based on the old salary, but then you still decided to build the pool.
Yeah.
How much did the pool cost?
Like $120,000. That was just the pool.
What else is there?
Oh, concrete, fencing that had to go around to build the pool. How much total? Another $100 grand.
When did it start hitting you that you were financially in over your heads?
I think immediately, like, we just weren't thinking about all the other things that were going to be added on. Where does the money come from for all all of these things? Credit cards.
Really?
Yeah.
And so what happened next?
We ended up taking a personal loan from some family.
How much did they loan you?
$100,000.
Did you run math? Wow, it got extremely silent in here.
