I Don't Know Where My Money Keeps Going

Summary

Podcast Summary: "I Don't Know Where My Money Keeps Going"

The Ramsey Show Highlights
Host/Author: Ramsey Network
Release Date: April 4, 2025

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Introduction

In the episode titled "I Don't Know Where My Money Keeps Going," the Ramsey Network team delves into the common financial woes of individuals who find their discretionary income mysteriously vanishing each month. Hosted by Dave Ramsey, along with experts George Kamel and Jade Warshaw, the episode offers practical budgeting advice to help listeners regain control over their finances.

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Listener's Dilemma: Unexplained Spending

Hayden, a listener, reaches out expressing confusion and frustration over his monthly budget. Despite having approximately $1,900 to $2,000 left after covering essential expenses, Hayden is perplexed by the disappearance of this amount.

• Hayden (00:06): "I have about 1900, $2000 left a month and I just don't know where it's going. It seems like I just spend it."

Dave Ramsey initiates the discussion by highlighting the discrepancy between Hayden's planned budget and his actual spending habits.

• Dave Ramsey (00:28): "On paper, if you did what the paper said on what you spent, you'd have two grand. But you're saying it's disappearing, it's being spent."

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Identifying the Root Cause: The "Treat Yourself" Budget

George Kamel identifies Hayden's budgeting approach as a classic "treat yourself" budget, where only necessities are budgeted, and the remaining funds are treated as free money with no specific allocations.

• George Kamel (00:28): "This is a classic case. You do what is called the treat yourself budget... everything else is up for grabs and you treat yourself."

Hayden confirms this alignment with his spending habits, leading George and Dave to explore the consequences of such budgeting.

• Hayden (01:04): "Yeah, that does sound about right."

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Analyzing Spending Patterns

Dave Ramsey encourages Hayden to examine his bank statements to pinpoint where the money is going, suggesting that categorizing non-essential expenses can illuminate hidden spending traps.

• Dave Ramsey (01:06): "If you go to your bank account statement and you add up all the things that weren't the necessary expenses, it would easily tell you what's going on."

Hayden identifies specific areas where his money is draining:

• Eating Out
• Gas Station Snacks
  • Hayden (01:34): "Definitely. Gas station."

George Kamel emphasizes that small, frequent expenses like gas station snacks can add up significantly over time.

• George Kamel (01:48): "Gas station snacks is a big thing... something that shouldn't go together."

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Reevaluating Asset Management: Truck and Boat Payments

Hayden discloses his significant debts:

• Truck Payment: ~$34,000
• Boat Payment: ~$12,000
  • Hayden (04:14): "Around 34,000... around 12,000."

Given his annual income of approximately $65,000 (down from $80,000 due to full-time work and college commitments), Dave Ramsey questions the necessity of maintaining high-value assets that contribute to financial strain.

• Dave Ramsey (05:12): "Can you get a cheaper truck to do this with?"

Hayden admits that selling his truck could be feasible:

• Hayden (05:15): "Yeah, I probably could."

George suggests that liquidating the boat would further alleviate financial pressure:

• George Kamel (05:43): "That's another maybe $2,1500 that you could put towards this debt."

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Implementing a Zero-Based Budget

Dave Ramsey introduces the concept of a zero-based budget, where every dollar is allocated to specific expenses, savings, and investments, eliminating the "up for grabs" mentality.

• Dave Ramsey (02:28): "I would suggest is a zero based budget, which is a form of budgeting that utilizes every single penny."

George elaborates on the long-term benefits of disciplined budgeting, including building emergency funds, reducing debt, and preparing for future financial goals like retirement or homeownership.

• George Kamel (02:30): "If you were to do a zero based budget, you'd not only be planning for those things... that's the beauty of this, is you get to decide."

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Addressing Parental Concerns and Emotional Barriers

Hayden expresses apprehension about downsizing his truck due to his parents' opinions regarding insurance costs:

• Hayden (06:36): "My parents... don't sell the truck, the insurance is going to blah, blah, blah."

Dave Ramsey and George address this by emphasizing personal financial responsibility and the benefits of reducing debt:

• Dave Ramsey (07:03): "They don't get a say in you getting rid of that payment because you're the one who has to pay it."
• George Kamel (07:33): "They have the best of intentions, but sometimes they only know what they know... that's not necessarily the right answer."

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Leveraging Settlements and Savings for Financial Stability

Hayden mentions an impending settlement from a surgery-related arm injury and savings provided by his parents:

• Hayden (07:46): "My parents got around 30 grand for me. I had a problem with my arm in surgery, so I got a... settlement coming in soon."

George and Dave advise using these funds strategically:

• George Kamel (08:12): "If George and I were in your shoes... that 30 grand, I'd keep it aside."
• Dave Ramsey (08:23): "It's an emergency fund. Plus some moving out money. Plus some down payment money."

This financial cushion would provide Hayden with the necessary security to make informed decisions about debt repayment and future investments.

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Actionable Takeaways and Conclusion

The episode concludes with clear guidance for Hayden and listeners facing similar financial dilemmas:

1. Adopt a Zero-Based Budget: Allocate every dollar to specific categories to prevent untracked spending.
2. Evaluate and Reduce Debt: Consider selling high-value assets like trucks and boats that are depreciating and burdening your finances.
3. Utilize Savings and Settlements Wisely: Build an emergency fund and prioritize debt repayment before indulging in non-essential spending.
4. Challenge Emotional and Familial Barriers: Make financially sound decisions despite external pressures or outdated advice.

Dave Ramsey (08:35): "Create your free EveryDollar budget today. The simplest way to budget for your life."

By implementing these strategies, Hayden—and listeners alike—can transform their financial habits, eliminate unnecessary debts, and pave the way toward long-term financial security.

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Notable Quotes

• Dave Ramsey (00:28): "On paper, if you did what the paper said on what you spent, you'd have two grand. But you're saying it's disappearing, it's being spent."
• George Kamel (00:28): "This is a classic case. You do what is called the treat yourself budget..."
• Dave Ramsey (02:28): "I would suggest is a zero based budget, which is a form of budgeting that utilizes every single penny."
• George Kamel (08:12): "If George and I were in your shoes... that 30 grand, I'd keep it aside."
• Dave Ramsey (08:35): "Create your free EveryDollar budget today. The simplest way to budget for your life."

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This episode provides valuable insights into the pitfalls of unstructured budgeting and underscores the importance of strategic financial planning. By adopting a zero-based budget and reassessing personal assets and debts, listeners can achieve greater financial clarity and stability.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today.

[Hayden]

I'm struggling. Well, not really struggling, but after all expenses and everything, that's a necessity paid. I have about 1900, $2000 left a month and I just don't know where it's going. I'm. It seems like I just spend it.

[George]

So.

[Dave Ramsey]

On paper. On paper. If you did what the paper said on what you spent, you'd have two grand. But you're saying it's disappearing, it's being spent.

[Hayden]

Yes.

[George]

Ah. Do you want to know what this is? A class. This is a classic case. You do what is called the treat yourself budget, which is I budget for all of the things that are like, necessities. Like I budget for my rent, my car payment, my groceries, you know, a couple of, you know, my cell phone bill.

[Hayden]

But.

[George]

But everything else is up for grabs and you treat yourself and then next thing you know, you're like, where did all. Where did the money go? So does that sound about right?

[Hayden]

Yeah. Yeah, that does sound about right.

[George]

Yeah.

[Dave Ramsey]

Like if you go to your. Your bank account statement will tell you. Right? If you go to your bank account statement and you add up all the things that weren't the necessary expenses, it would easily tell you what's going on, right?

[Hayden]

Yeah.

[Dave Ramsey]

So what would you say is. Are the top three things this money is disappearing to? Eating out. Are you sports betting.

[Hayden]

Really?

[Dave Ramsey]

Gas station snacks.

[Hayden]

Definitely. Gas station.

[Dave Ramsey]

Okay, I just guessed here, a little there.

[George]

Well, you know what? I find that gas station snacks is a big thing. Like that seems to be a high ticket item here. I don't know what it is, but.

[Dave Ramsey]

I don't go in there. I'm. I'm too nervous.

[George]

I don't go in the gas station to get food. There's two things, things that just shouldn't go together. I don't know. But anyway, do you have any other advice?

[Dave Ramsey]

Are you like dip something. Something that you're spending vapes? I don't know.

[Hayden]

No, I mean, I. I mean I bought truck parts and different things. I mean, I dabble here and there spending. You single usually? No, I got a girlfriend.

[George]

Oh. Well, that might be where some of it's going, I would think. Here's what I think you need to do. Okay. So a. I used to budget just like that. I was definitely the treat Yourself budgeter who wanted to use the rest on like it's up for grabs. That's the way I felt about it.

[Dave Ramsey]

You ate your vegetables, all right, you get some dessert.

[George]

But the truth is when you treat your money like that, you'll look up 10 years from now and there's a lot of regret because you go, oh my gosh, so much money passed through my hands and I was not a good steward of it. As a matter of fact, for most people, think about it, if during your working years, Most people work 40 years, let's say you just make an average of $50,000 a year, that's over 2,000, that's over $2 million. That's going to pass through your hands. And if you take this portion of it and you just go up, it's up for grabs. I don't know what happened to it. You can't really call yourself a good steward of your money. And chances are you won't be prepared when the time comes to retire or buy a house or any of those things that, you know, we want to do to feel the success of our finances. So what I would suggest is a zero based budget, which is a form of budgeting that utilizes every single penny. And I just want to kind of clear up because a lot of people feel like budgets are kind of restraining. Right. Hayden and I have a feeling that you feel that way. Like you feel like a budget is something that's going to keep you from doing the things you want to do, when really it's the exact opposite. Because if you were to do a zero based budget, you'd not only be planning for those things like rent and car payments and keeping the lights on, but you'd also go through and say, wow, I have nineteen hundred dollars of margin. What is it that I want to do? Do I need to have a thousand dollars of savings? Do I need to build up a three to six months emergency fund? Is there debt I need to pay off? And if you've already accounted for those things, then you can say, okay, yeah, I want to spend a little bit on hunting and I want to spend a little bit on, I don't know, wawa snacks. And so that's, that's the beauty of this, is you get to decide. So let George and I help you decide. Do you have any debt?

[Hayden]

I have a truck payment and then a boat payment.

[George]

Okay, how much do you owe on the truck?

[Hayden]

Around 34,000.

[George]

And how much do you owe on the boat?

[Hayden]

Around 12,000.

[George]

Okay. So that right there is a good indicator of what you should be using that margin for.

[Dave Ramsey]

What do you make a year?

[Hayden]

Last year I brought in around 80 grand, but this year I'm working full time and doing college. So it's it's dropped about 10, 15.

[Dave Ramsey]

So you're making about 65 grand?

[Hayden]

Yeah, give or take.

[Dave Ramsey]

Okay. Man, you got a lot tied up in wheels and motors going down in value to be making 65 grand. Have you ever thought about selling these two items and getting something cheaper?

[Hayden]

Well, the truck is what I use to make the money. Every day I drive for work. I do like hotshot.

[Dave Ramsey]

Can you get a cheaper truck to do this with? I don't think it's a $34,000 truck causing this.

[Hayden]

Yeah, I probably could.

[Dave Ramsey]

I mean if you had a $15,000 truck that was running great, could you do the same work and get paid the same?

[Hayden]

Yeah.

[Dave Ramsey]

Okay, that tells me the truck was for you. And yes, you do use it for work. But you can also get a cheaper truck, get out of this debt, free up more margin. And I imagine you don't have a lot of time to be on the boat when you're working and a full time student.

[Hayden]

Yeah, I do plan on selling the boat this, this upcoming spring.

[George]

What can you get for it?

[Hayden]

Oh, probably around 15. Okay, 1450.

[George]

Okay. So that's another maybe $2,1500 that you could put towards this debt. What George and I are getting at is, and this is an old, this is what Dave Ramsey would say your biggest wealth building tool is your income. Right. And so good for you that you have $2,000 of margin every month. Bad for you that you have this debt. Because what are your payments on the.

[Hayden]

Truck in the boat combined around 1300. I could refinance them, but I've just decided to try and paying off.

[George]

Yeah, I think that's good. But think about if you had that $1300 back in your wallet plus the 2000. That's a lot of money. And so if we can get these things sold or paid off, that's really where you're going to see the ultimate potential with that money. And then we'd be saying things like hey, with this margin you could be investing 15% and hey, you could be doing. Do you see what I'm saying?

[Dave Ramsey]

Down payment.

[Hayden]

Well, my only problem with that is like my parents, which I just turned 20 and they're more like don't sell the truck, the insurance is going to blah, blah, blah.

[George]

They're wrong. Hey, if you have a paid off vehicle, your insurance is going to be lower. If you have a used payoff paid off vehicle, your insurance is likely going to be lower than if you had something that's newer with payments. That's the truth.

[Hayden]

That's what I thought, but, yeah, I don't know. They just.

[Dave Ramsey]

Are they making the $1300 payments for you every month?

[Hayden]

No, they don't.

[Dave Ramsey]

They don't get a say in you getting rid of that payment because you're the one who has to pay it.

[George]

Hey, the truth is, with parents, like, they have. They have the best of intentions, but sometimes they. They only know what they know. And so a lot of times it's like they do it one way, so they pass that way on to you. And even though it's a good intention, it's not necessarily the right answer or the best way to do it. Does that make sense?

[Hayden]

Yeah.

[George]

And so I think from where you're sitting, you can just be like, okay, thanks. That's when you just do the smile and nod and you're like, okay. And then you go into your life and you do the thing that you know how to do in your own life.

[Dave Ramsey]

You can be kind and respectful.

[George]

That's right.

[Dave Ramsey]

Do you have any money in savings, Hayden?

[Hayden]

My parents got around 30 grand for me. I got a. I had a problem with my arm in surgery, so I got a.

[Dave Ramsey]

A settlement.

[Hayden]

A settlement coming in soon.

[George]

Okay.

[Dave Ramsey]

And that'll be in your name. You said your parents have it for you.

[George]

Yeah.

[Hayden]

No, it'll be in my name.

[Dave Ramsey]

Okay, man, that. That'll set you up for sure.

[George]

Yeah. So. So if George and I were in your shoes. Yeah. That 30 grand, I'd keep it aside. Let's call that if you're selling this boat and if you're selling the truck or deciding to keep the truck.

[Dave Ramsey]

It's an emergency fund. Plus some moving out money. Plus some down payment money. That sets you up, man.

[George]

Yeah, I would definitely downsize this truck. I would not pay it off with what you're earning and what your life is. I downsize it. Yeah. This is the Ramsey Show.

[Dave Ramsey]

Create your free every dollar budget today. The simplest way to budget for your life.