Fran Tunno Mills has (probably) $176,000 coming to her from the sale of her California home, which makes her feel financially okay. Her financial advisor, provided by the LA Times as part of their money make-over series is less sanguine--she thinks Fran is in a financial pit and will have serious problems climbing out. As this article makes clear, the financial advisor is almost certainly correct.
Fran is 54 years old, newly divorced (the house was sold and the proceeds divided as a result of divorce), and does voice-over work on contract, which garners her approximately $40,000 a year. [Another thing I can't tell from the article is if she gets child support for her two children or if that is included in the $40,000.]
She has saved only $29,000 toward her retirement, and has $39,500 in debt.
To her credit, Fran knew she needed help figuring out where to go next. But Fran was wondering whether to buy a house or a condo. Her financial advisor was thinking Fran can't afford Domino's pizza, much less a home.
Clearly, living in Southern California is part of the problem. It appears that Fran is considering a move to a small town in Pennsylvania to be near her father, though the article doesn't say whether she can continue her recording contracts from that distance.
On one hand, Fran contributes $300 a month toward her children's college funds, but on the other hand, she uses credit cards to maintain her standard of living. Neither of those can continue.
I have a lot of empathy for Fran's position. I was roughly her age before I saw the necessity of putting money away for retirement. And, like her, I still had teenagers at home during my fifties. I know that if anyone had dropped $176,000 into my lap, I would have felt like I was home free. And I probably would have looked around for new housing.
I think she was fortunate to have a savvy financial advisor to set her straight. The housing proceeds will come in very handy, but just to get her back to zero. She still has to make a lot of plans for her financial future that will entail a number of cutbacks in her family's current lifestyle.