I am 55 years old, my husband is 59. Six years ago our financial life seemed pretty secure. Today it is anything but. Not only have we been hurt by the downturn in the stock market in the last six years, but a number of bad financial decisions have left us scraping to get by. My husband’s income is 1/3 of what it was six years ago and mine, though not that dramatically different, is less than I was earning. We still have a mortgage, two car payments, and put money into a RRSP every month in order to avoid income tax from one of the “bad decisions” that was made. The money we earn barely keeps us afloat. We do have money in investments but we can’t touch it without having to pay income tax on it.

My husband and I have difficulty talking about it as the emotions are high. It has had a very negative effect on our health. I don’t want to work until I am 65 but as things stand I might have to. My husband purchased a franchise that causes him an incredible amount of stress and doesn’t give him much of a salary. He needs to sell it but then what would he do? At his age opportunities are few.

We have little energy left at the end of the week for our children and grandchildren. th of our mothers are still alive and what free time we have we try to spend with them. As far as inheritance goes, we don’t expect much. 

We don’t know where to turn. Can you make any suggestions? Please!! I would rather you contact me at work as I don’t want my husband to know right now that I have written to you. Any suggestion you could make would be appreciated. – P.A.

Gordon’s answer: I’m not a psychologist, but it sounds to me as though your problems are just as much psychological as they are financial. Look at your own words. You “have difficulty talking about it”. “Emotions are high.” “I don’t want my husband to know.” It seems to me that if you are going to get your lives back on track, one of the elements that must be introduced is counselling.

Then look at some of the other things you say. “Very negative effect on our health”. “Little energy” for children and grandchildren. “Incredible amount of stress.” What kind of lives are you leading? You are missing some of the greatest joys that our time on earth has to offer and appear to be cutting years off your life expectancy. What does your family doctor say about this?

Now look at your finance-related statements. Income down. Paying off mortgage. Two car payments. RRSP contributions. Can touch investments. Does it not occur to you that you are trying to maintain a lifestyle that was doable when your incomes were higher but is no longer sustainable? Perhaps you need to make some life-changing (and perhaps life-saving) adjustments.

It sounds like your kids have grown up. Do you really need to stay in the house you’re in? Could you not downsize and live mortgage-free? Do you really need two cars? Would it not be better to pay the tax and free up some of the money you are putting into RRSPs to avoid it? After all, how high can your marginal rates be, given the income situation you describe?

Your husband needs to seriously ask himself whether the “incredible stress” he is under is worth it for the amount of income he is making. What would he do if he sold the franchise? The answer is easy. Anything that he enjoys and that would make his life less stressful.

You are facing some tough decisions. But unless you confront them head-on and do what’s needed, there is no way you are going to escape from this vicious downward cycle.