Extreme makeover: Couple needs cash flow

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Mark, who is a full-time student, took a leave of absence from school to work full-time after his wife, Andrea, lost her job due to pregnancy.  Mark believes that even with Andrea working again his current salary is so low compared with his debt that he has no choice but to return to school, so he can continue to defer paying back his student loans.

This couple’s immediate problem: “They need steady cash flows and reduced expenses,” says Robert L. Riedl of Sumnicht & Associates.

Mark sits precariously perched between adding debt to attain his degree and leaving school and being left with massive debt and nothing to show for it. But he might be able to defer payment on his student loans by taking less expensive community college courses. “Swapping to a night or extended-term program might allow for [attending] school—at lower tuition—and increased work hours,” says Paul Escobar of Eskie Specialty Advisors.

Mark could ask his employer to pay for his education in exchange for a time-commitment to the company, Dennis Stearns of Stearns Financial Group says.

Escobar suggests Mark consider trading his car for a more modest vehicle or car-sharing. If he returns to school full-time, Mark should consider on-campus housing for its cost advantages.

The experts urge Andrea, a financial planner, to consider a fee-based or salaried position, which might provide daycare, or land a job in another field and do financial planning nights and weekends, adds Lynn Ballou of Ballou Plum Wealth Advisors.