Both of these things are credit crunchy.
My company’s taken an across-the-board pay cut. I am a staff rep to senior management about this. One of my coworkers, a very sweet lady, has asked me to represent her and find out “where that money’s going.” I tried explaining to her that it doesn’t “go” anywhere, it just reduces our overheads to prevent us going into the red. She doesn’t understand.
I have showed her a cashflow projection diagram, illustrating at what point, absent immediate savings, the company’s cash position would be unsustainable at current salary levels, but again she has said “yes I understand all that, but where is it going?”
I guess I need something like the mortgage/bank speech from It’s a Wonderful Life. Any suggestions?
The other issue is my house. It’s verging on negative equity. My ex-wife and I still own half each, but I occupy it.
I have explained to her that, should I be unable to make mortgage payments, I will lose the house (I would be happy to trade places but I don’t think she could afford it). And in that eventuality, were the house worth less than the outstanding mortgage, she would then be liable for 50% of the debt, with absolutely nothing to show for it.
I have therefore suggested that she take legal advice, with a view to letting me buy her out at current market rates - in effect, signing the house over to me - so I would take the financial hit should anything untoward happen.
We maintain an excellent friendship, but she simply doesn’t understand the concept of equity - while we were married I tried explaining it to her dozens of times, to no avail. And now, I can see in her eyes she thinks I’m trying to cheat her out of something; indeed maybe I would be, should the housing market recover, but that’s not going to be for a long long time, and I suspect I am more likely to lose my job than sell the house for a profit. I’m actually trying to save her trouble.
Any ideas on better ways to put these subjects?