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Dave Ramsey suggests how 'concerned' widow, 65, can clear debt and get by in retirement

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On The Ramsey Show – Highlights YouTube, Kathy, 65 called in because she was not sure what she could do. After losing her husband, she was not taking in half as much income as they used to.

Kathy lost her husband three years prior and they were not finished planning for their retirement.

She explained to the finance expert that they were in good shape but since losing his income, she has been struggling to get by.

They had a business mortgage lending business together and he was the broker. It takes training so it is not a role she can take over easily.

She works part time but said this is “nowhere near” what they were bringing in before.

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Her house is paid for but she has around the $30,000 (around £24,000) in debt.

She also has $20,000 (around £15,000) on credit cards and $10,000 (around £8,000) for a timeshare scheme her and her husband signed up for before he passed.

However the timeshare scheme is becoming expensive due to maintenance fees increasing.

She does not use it very frequently so she doesn’t think it is worth it anymore. She wanted to get rid of it but didn’t know how.

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Kathy is currently on social security. Social Security is a federal program in the U.S. that provides retirement benefits and disability income to qualified people.

Towards retirement, Kathy has $238,000 (around £190,000) in mutual funds and $131,000 (around £104,000) in an annuity and $50,000 (around £40,000) in the bank.

Mr Ramsey explained that he would get rid of the timeshare and write a cheque to clear the credit card debt today.

He said: “Chop up the stupid credit card you’ve got to stop using them.”

“You have almost $500,000 (around £400,000.) You’re 65 so when you’re 72 if you don’t touch it it will be worth $1million (around £800,000) if it’s invested like we teach you.

“Just let it double. It will double around every seven years. Make sure that money is growing.”

He explained that Kathy can invest into mutual funds but that it is a process.

Mr Ramsey said: “The more you do it, the more you will become familiar with it and more confident you become.”

He suggested that Kathy finds an investing tutor who has the heart of a teacher.

“I don’t want people putting money in something they do not understand because you are scared,” he said.