A Bigger Paycheck Won't Fix Bad Money Habits

Summary

The Ramsey Show – Episode Summary
Episode: "A Bigger Paycheck Won't Fix Bad Money Habits"
Date: July 14, 2026
Hosts: Dave Ramsey, Rachel Cruze, George Kamel

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Episode Overview

This episode of The Ramsey Show zeros in on the central message that earning more money cannot solve underlying bad money habits. Dave Ramsey and his co-hosts, Rachel Cruze and George Kamel, field real-life questions from callers, offering practical, tough-love advice. Their recurring theme: Wealth is built through discipline, clear decision making, and a commitment to living debt-free—regardless of income.

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Key Discussion Points & Insights

1. Home Buying Struggles, Down Payments, and Market Reality

[00:43–04:45]

• Caller Richard (Fort Worth, TX) has $130K for a down payment but finds housing with foundation issues and gets outbid frequently. He wonders whether to keep searching or invest the money elsewhere.
• Advice:
  • Don’t overgeneralize housing problems; keep looking because not all lower-priced homes have serious issues.
  • Consider lowering expectations or adjusting the down payment ratio for more options.
  • Avoid emotional decision-making—take a strategic approach and be patient.

Quote (Rachel):
"The idea that all homes in Fort Worth have all but five have foundation issues... that's bull crap. That's not true... Otherwise the entire city of Fort Worth would have fallen in by now and no one would live there." (02:37)

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2. Should Investments Pay Off Debt? Even for High Earners

[04:49–09:02]

• Caller Steven and his wife (engineers earning $200K/year) have $30K in investments and ~$40K in debt (student loans, car loan).
• Advice:
  • Use non-retirement investments to pay off debts from smallest to largest; keep retirement accounts intact to avoid penalties.
  • High income does not justify keeping debt—follow the system to build wealth faster.
  • The rule applies no matter your income: "You can't out-earn stupidity."

Quote (Rachel):
"America runs around going into debt all the time. The shortest distance between where you are and wealth is not savings. It is clearing off all debt and staying out of debt." (06:10)

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3. Financial Betrayal & Day Trading Addiction

[10:21–19:50]

• Caller Jane (New York City) lost control of family finances when her husband started day trading. He depleted almost all savings, refused transparency, and declined counseling.
• Advice:
  • Treat addictive/extreme financial misbehavior seriously, akin to substance abuse.
  • Separate finances and consider ultimatums—protect yourself legally and emotionally.
  • Seek help from trusted advisors, such as a pastor or counselor; do not tolerate ongoing financial abuse.

Quotes:
"What do you do if your husband's doing cocaine?... I'm not going to stand here while you ruin the whole freaking family with your moronic day trading." (Rachel, 12:36)
"97% of day traders lose everything." (Dave, 12:56)
"He's saying, 'I don't want to be married to you.' That's what he's saying." (Rachel, 15:10)

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4. Navigating Prenups in Later-Life Marriages

[21:30–30:45]

• Caller Nancy (Los Angeles, 56, marrying 71-year-old fiancé with $2M in assets) resents his desire for a prenup.
• Advice:
  • Prenups are reasonable when there’s a substantial net worth difference, to protect both parties.
  • Discuss inheritance and future asset arrangements thoroughly before marriage.
  • Offset what each gives up for fairness (e.g., lost job, relocation).

Quote (Rachel):
"We don't recommend prenups except where there's extreme differences in net worth. And this is an extreme difference in a net worth." (24:09)

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5. Major Purchases & Living Within Means

[32:28–38:39]

• Caller Grant (Ft. Lauderdale, 24, $150K/year, wants to buy a $16K boat cash).
• Advice:
  • Never have more than half your annual income tied up in depreciating assets (cars/boats/etc.).
  • Buying with cash, within limits, is fine—even for fun purchases.

Quote (Rachel):
"Most people make the mistake of spending...too high a percentage of their net worth...on things that go down in value, and then wonder why they're broke." (34:04)

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6. Older Homeowners Planning for the Future

[38:45–41:07]

• Caller David (San Antonio, 74, no heirs) asked about selling his house to a neighbor now with the option to live in it for life.
• Advice:
  • Avoid life estates with non-family; instead, specify wishes for home sale in a will.
  • Get a will immediately to ensure assets are distributed as intended.

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7. Medical Debt, Ripoffs, and Navigating the Healthcare System

[43:53–59:43]

• Caller Mary (Raleigh, NC) faces a $3,128 bill for a basic MRI after insurance.
• Advice:
  • Challenge the bill—medical billing mistakes and overcharges are rampant.
  • Shop around for cash-pay prices before procedures.
  • Only pay if all attempts to resolve fail; otherwise, consider new providers and insurance.

Quotes:
"Assume that no one has your back." (Rachel, 53:59)
"Open a medical bill, automatically assume it's wrong." (Dave, 55:44)

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8. Medical Emergency and Family Career Crisis

[59:46–63:07]

• Caller Tammy (Houston, 42) needs $17,000 for brain surgery; her husband's career stalled.
• Advice:
  • Husband must focus on stable income; medical costs will become manageable as earnings increase.
  • Use payment plans, and prioritize family financial stability.

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9. Widow Planning: Homeownership, Wills, & Moving Forward

[77:27–85:57]

• Caller Carrie (Austin, recently widowed, young child) wants to relocate, homeschool, and ensure financial security.
• Issues: Home ownership complications (no will, results in split between children).
• Advice:
  • Avoid major decisions for at least a year; seek additional legal counsel on the estate.
  • Live simply; keep emergency funds and consider incremental steps when moving or investing life insurance payout.

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10. School Debt for a Career Change

[86:31–94:10]

• Caller Matthew asks if taking on debt for nursing school is ever justified.
• Advice:
  • Never go into debt for schooling; pay cash or seek employer sponsorships.
  • ROI is key, but so is the cost structure—find the cheapest accredited path.

Quote (Dave):
"Nobody cares where you go to school... All they cared was, could I help them." (92:18)

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11. Family Obligations, Reverse Mortgages, and Elder Care

[118:49–125:08]

• Caller Susan (Flint, MI) asks if a reverse mortgage is reasonable for her elderly mother in a tight spot.
• Advice:
  • Never recommend a reverse mortgage—high fees, high foreclosure rates, and generally bad terms.
  • Family contributions are a better solution; consider small home equity loans only as a last resort.

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Memorable Quotes & Moments

• "You can't out-earn stupidity." (Rachel, 08:19)
• "You're not defined by the worst thing you ever did." (Rachel, 70:31)
• "Assume that no one has your back [in medical billing] and that'll be a good start..." (Rachel, 53:59)
• "Never more than half your annual income in things with wheels, motors, or batteries." (Dave/Rachel, 35:19)

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Notable Timestamps

• 00:43 – Caller Richard on home buying woes in Fort Worth
• 04:49 – Caller Steven on using investments to pay off debts
• 10:21 – Caller Jane on day trading addiction and marital breakdown
• 21:30 – Caller Nancy debates prenup with much wealthier fiancé
• 32:28 – Caller Grant weighs buying a boat for $16,000 cash
• 38:45 – Caller David considers selling his lifelong home with a life estate
• 43:53 – Caller Mary’s MRI medical bill outrage
• 59:46 – Caller Tammy’s struggle with medical costs for brain surgery
• 77:27 – Caller Carrie (new widow) seeks advice on buying a home/homeschooling
• 86:31 – Caller Matthew on debt for nursing school
• 118:49 – Caller Susan asks about a reverse mortgage for aging parent

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Ramsey Show Core Takeaways

• A bigger paycheck isn't the answer to bad financial habits: Systematic discipline and the baby steps are key, regardless of income.
• Debt is the enemy: Even high earners should clear debts before investing.
• Protect yourself in relationships and major life events: Clear communication, legal documentation (especially wills), and separation of finances are crucial.
• Never assume others (especially medical institutions) will look out for your best interest:
  • Always audit, shop around, and challenge bills.
• Family matters require compassion and practical planning: Aging parent care, estate issues, and financial support often demand open dialogue and unity.
• Life is unpredictable: Build flexibility, have an emergency fund, and press pause during emotional upheaval.

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For more advice or to ask your question, visit ramseysolutions.com.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broken. Common sense is weird. So we're here to help you transform your life.

[Rachel Cruze]

From the Ramsey Network and the Fairwinds

[Dave Ramsey]

Credit Union studio, I'm Dave Ramsey. This is the Ramsey Show. Rachel Cruz, Ramsey personality number one best selling author and my daughter is my co host. Today Richard is in Fort Worth, Texas.

[Rachel Cruze]

Hi Richard, how are you?

[Caller Richard]

I'm doing well. Dave, how are you? Doing well today?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller Richard]

Hey.

So my wife and I are on baby step four. We're trying to save up to buy a house. Now we currently have 80,000 and my parents are willing to put in 50 so a total down payment of 130. The problem is in the Fort Worth area, property taxes are very, very high and any home with a value of under 270 is going to have major foundation issues. And when we have found a home that we do like and we want to put an offer in every time, we've been outbid by quite a bit. So do we continue looking or do we just take our money, give up on the getting the house and just put that money towards retirement?

[Caller Jane]

Wow.

[Caller Grant]

Yeah.

[Caller Richard]

And that's putting half down.

[Rachel Cruze]

Yeah. Yeah. That's pretty cool. I like your idea. Well, I. Sorry you hadn't been able to find a house yet, but I suspect you will if you continue on the journey. House hunting is never a perfect process. It's not like going to the grocery store and just walk down it, you know, Costco and get 5 gallons of peanut butter and not think anything about it. You, you know, you do have to hunt. And yes, there are some foundation issues in the Fort Worth area. It's the nature of the soil you have there. But to say that all homes in that price range in Fort Worth have foundation issues is not a true statement. That's a little bit over dramatized to say the least.

[Caller Richard]

Well, we've been looking at homes for six months and I can count on one hand the amount of homes we've seen without foundation issues.

[George Kamel]

Well, Richard, what if you guys limited it down to a 20% down payment and got a larger home or not larger, Sorry, more. Not that it's size has to. Not that it's larger in size, but in quality.

[Rachel Cruze]

Yeah, I'm just.

[George Kamel]

And in value.

[Rachel Cruze]

Richard, the idea that all homes in Fort Worth have all but five have foundation issues, honestly, I'm going to call you out again. That's bull crap. Okay, that's not true. That's just not true. You may not have found them. I don't know what you're looking at or what your deal is, but that's just not true. Otherwise the entire city of Fort Worth would have fallen in by now and no one would live there. And instead, it's quite a prosperous area. It does very well. It's a wonderful town. But you're not wrong in the fact

[Dave Ramsey]

that there's probably a lot that do.

[Rachel Cruze]

It is a foundation issue in the Fort Worth, Dallas area in general. It's a soil thing, a sand content. And so versus Tennessee, where we got rock and clay, you want a basement here, you got to get dynamite involved. So because we grow rocks like people grow trees. So I mean, it's something all the time.

[Dave Ramsey]

But the other question is this.

[Rachel Cruze]

To what extent is the foundation damaged?

[Dave Ramsey]

Is this a structural problem? Or did you walk in and see

[Rachel Cruze]

a hairline crack and go into drama mode? Because I've never poured any concrete and I've been in the real estate business

[Dave Ramsey]

most of my life that it didn't crack.

[Rachel Cruze]

Eventually 100% of concrete will shift and crack. There's just no such thing. Okay. Because soil moves, earth moves. It's life expands and contracts with moisture and freezing and temperatures, all that. So are you overdoing that?

[George Kamel]

Well, yes, I would ask all those questions for sure. And then I also would say, okay, well, maybe your expectations of what you get for, for a $260,000 house is maybe not up to your part. And so maybe you either lower your expectations of what you're going to get or maybe you say, hey, you know what, let's use this. Instead of a 50% down payment, let's do a 30%. Right.

[Dave Ramsey]

I mean like assuming you have the income to support 100%.

[George Kamel]

Yes. So I'm like, there is a reality to what you can buy with this amount of money and what you're seeing. Sure. But I agree with you to just make blanket full statements about all houses somewhere.

[Rachel Cruze]

Yep. Cameron in St. Louis. How are you, Cameron?

[Caller Richard]

Good.

[Caller Steven]

How are you?

[Rachel Cruze]

Better than I deserve. What's up?

[Caller Steven]

I need to know if I should use some of my investment money to pay down some student loans and a car loan.

[George Kamel]

How much you have in Investments?

[Caller Steven]

About 30,000 that I can pull out. And then I have a couple different accounts that I could take some penalties on, but try not to do that.

[George Kamel]

Is the 30,000 and non retirement accounts?

[Caller Steven]

Yes.

[Rachel Cruze]

The other accounts are retirement accounts with the penalties?

[Caller Steven]

Yes.

[Rachel Cruze]

Okay, and how much debt do you have?

[Caller Steven]

I have, I have 3,000 soon loans my wife has 18,000 and then we have an 18,000 car payment.

[Rachel Cruze]

So you can't clear everything?

[Caller Steven]

Pretty close to it. I have some saved up too in savings.

[Rachel Cruze]

Oh, how much is that?

[Caller Steven]

About 5,000.

[Rachel Cruze]

Okay, so you got 35, but I thought I heard 18 and three. And what was the other number?

[Caller Steven]

18, 18, 503. So I guess I. Yeah, I have about 40,000 in that.

[Rachel Cruze]

So you don't have enough money. All right, I thought, I thought I heard that.

[Caller Steven]

Right.

[Caller Richard]

Okay.

[Rachel Cruze]

But you're close. All right, so you've not been listening to us a long time, I take it.

[Caller Steven]

No, just started a couple weeks ago.

[Rachel Cruze]

Okay, cool. Well, welcome. We appreciate you being here. We're weird because America runs around going into debt all the time. And what we discovered several decades ago when I went broke and lost everything was that the shortest distance between where you are and wealth is not savings. It is clearing off all debt and staying out of debt. Because your most powerful wealth building tool is your income. And when you don't have any debt, you can use your income for generosity and for wealth building. And you will become wealthy much faster than those investments will make you wealthy. So all of that to say we're all about getting people out of debt so that they can become wealthy faster.

[Caller Steven]

Yes.

[Rachel Cruze]

Which is gonna lead us to the answer. Yeah. Which is gonna lead us to the answer to your question is yes. We would clean out the SA investments and we pay off your debts, smallest to largest. So I pay off the. You said he had a little credit card and I'd cut it up. No more using it. And I'd pay off the car and never buy another car the rest of your life unless you pay cash for it ever again. Because car payments will make you broke and keep you broke. And then we're going to clean off the largest debt, most of it, but not quite all of it, which was the student loan, if I heard my numbers right.

[Caller Steven]

Yeah.

[Rachel Cruze]

Okay. And see, now you don't have a car payment, now you don't have a credit card, and now you're on a written budget and you're going to knock out that last little bit of debt without all those payments. If you just took all those payments and invested them for the next 15 or 20 years, just that will make you a millionaire. And we're going to take you much further than that.

[Caller Steven]

I guess I have another question.

[Rachel Cruze]

Okay.

[Caller Steven]

Does it matter what our income to our debt ratio really is? I guess because me and my wife are both engineers and make quite a bit of money, but I Don't know if it makes sense to pull all this out or just keep doing what we're doing.

[George Kamel]

How much do you guys make a year? I'm just curious.

[Caller Steven]

Combined income with my bonus, we make about 200,000.

[Rachel Cruze]

Okay, I'm going to send you a copy of the book Baby Steps Millionaires. We did the largest study of millionaires ever done. And oddly enough, the number one career track of the typical millionaire is engineer. Because you guys know how to work a system. And I'm going to teach you a system and if you'll follow it just like you follow engineering principles, it will work. And so no, it doesn't make any difference. You can't out earn stupidity. So I don't care what you make, you still got to run the principles. Hang on, we'll send you a copy of the book.

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[Dave Ramsey]

Jane is in New York City.

[Rachel Cruze]

Hi Jane, how are you?

[Caller Jane]

I'm fine, thanks Dave.

[Rachel Cruze]

What's up?

[Caller Jane]

I'm 52 years old. I've been married 28 years. I have two college age kids and up until last year I took care of paying the bills from my and my husband's joint account. We had no debt, no loans, no car payments and we had about $120,000 saved up for it was to buy a house. So last year when we Would have an argument. Sometimes my husband would say, maybe I should just take over the finances. And I just brushed it off. Like, that's a weird thing to say because we never had separate accounts or anything, and he had access to everything. So in May, he tells me that he wants to spend $11,000 on day trading. And so I reluctantly said, okay. In the past, he lost money day trading as well, But I just figured that he would just get it out of his system, and if he got anything, that would be great. But it was 11,000. So it turns out that I gave him all the finances because it was too stressful for me. And through the summer, he just depleted the entire savings. 50,000, 45,000, 30,000. Whenever I would ask him about it, he would just say, I moved it to another account, and I'm not answering any questions about it. And during that time, our landlord also told us that we need to move. And so I was like, we need that money to get a house. And my mom also gave us $50,000 when she found out we needed to move. So he says, no, we're going to stay here another year, and I'm going to day trade, and I can double this money. And so it was extremely stressful. Finally, in April, after asking him all winter, what are we going to do? What are we going to do? What are we going to do? Because I had no access to anything anymore. I had no. I couldn't see anything. If I asked him to show me what he's doing, he said, I don't want you looking over my shoulder.

[Rachel Cruze]

So why have you tolerated this?

[Caller Carrie]

I didn't.

[Caller Jane]

What could I have done?

[Rachel Cruze]

Well, I mean, if. What do you do if your husband's doing cocaine?

[Caller Jane]

I don't know what I would do. Call the police.

[Rachel Cruze]

Yeah. I mean, just tell him he's either gonna go into rehab or I'm gonna divorce you. Yeah, well, because I'm not going to stand here while you ruin the whole freaking family with your moronic day trading.

[Caller Jane]

Well, he lost it all.

[Dave Ramsey]

I'm sure he did. 97% of day traders lose everything.

[George Kamel]

Yeah.

[Caller Jane]

We still need to move, and I still have $130,000 in savings.

[Caller Richard]

You do?

[Caller Carrie]

Yeah.

[Dave Ramsey]

How do you know?

[Caller Jane]

For my mom. He has no access to that money. Oh, I still have that separate.

[Caller Richard]

He didn't.

[Caller Jane]

He doesn't. Can't touch that money.

[George Kamel]

Yeah, that's what I would. Well, that's the first thing I would do, Jane, is start separating everything. And like you did with that account, that he cannot have access anymore. Because the trust is completely broken. And how he's handled that and how he's handled you in the process, giving you no voice in it. Giving. Completely brushing you off, putting you to the side. That's a complete marriage breakdown. And that's. That's. That's the red flag that I see is that your marriage, that's on the rocks. Right. When your husband treats you like that, and it's way more than the money problem at that point, that's a husband and wife issue. So have you guys reached out to have any level of change or something? Or is he just completely basically ignoring you through all of this?

[Caller Jane]

He's ignoring me. I asked the pastor for counseling, and he said that he doesn't believe in counseling. So he went to the first counseling session and he said to the pastor, I don't believe in any of this. I'm not going to say anything. And he refused to talk.

[George Kamel]

Yeah, that's a hard. That's a hard place to go forward. Right? I mean, again, beyond the money situation,

[Rachel Cruze]

if you just change this extreme misbehavior to a different kind of extreme misbehavior, it indicates to you what's going on and then how you're going to have to handle it. And that's gonna be under the direction of your pastor. Under the direction of a counselor. Not under my direction, but it's going to end up in an ultimatum. Cause you're not going to live like this. I can hear it in your voice. You're not gonna put up with this a lot longer.

[George Kamel]

Yeah, she almost didn't put up with you when you were blaming her at the beginning. You got fired, Jane. You got some fire in you, which is good.

[Caller Jane]

Well, I told him. I said, I'll pay all the debt off and whatever's left, I'll give a down payment for the house, but you have to stop trading and give me

[Rachel Cruze]

control of all the money.

[Caller Jane]

Yeah, I said give me control of all the money, and you can't touch it until trust is gained. And he said no.

[Rachel Cruze]

Yeah. Then he's saying, Dr. John Deloney says behavior is a language. He's saying, I don't want to be married to you. That's what he's saying.

[Caller Susan]

Okay.

[Rachel Cruze]

So you need to sit down with your pastor, honey, and your pastor, and you need to talk about whether or not you're going to stay married in an abusive relationship because you're being abused. And it's not fair to you. You know, the way you've been treated is wrong, and it's as if he's doing cocaine. And he says, oh, I'm not gonna go to a counselor. I don't need help. I'm not addicted. I don't have a problem. You have a problem. Well, you got two other people sitting here going on the other side of this. And in three and a half minutes, we determine that you don't have a problem. He does. Your only problem is him. So he's either going to engage in change or you're not going to be there.

[Dave Ramsey]

Because I can tell, listening to you,

[Rachel Cruze]

you're not going to put up with it much longer.

[Dave Ramsey]

And the problem is, if you don't

[Rachel Cruze]

sit down and address this directly with a counselor, with some help, you're going to go.

[Dave Ramsey]

I've worked with.

[Rachel Cruze]

I've done this for almost 40 years now, and I've sat with couples, and I don't know. I do not understand this. And people are going. I'm going to get criticized for saying this, but women in particular put up with crap longer and longer and longer and longer. And all of a sudden, a switch flips and you're done. And no amount of nothing will get you back.

[Dave Ramsey]

We can't reel you back in.

[Rachel Cruze]

You're just done. Like the thing tipped over and Humpty Dumpty is over. You can't put the boy back together again. And I don't want you to reach that point accidentally.

[Dave Ramsey]

If you're going to reach that point, I want you to do it intentionally.

[George Kamel]

Yeah. And James.

[Dave Ramsey]

And with some help, honey.

[Rachel Cruze]

With some help.

[George Kamel]

Now I just want to circle back, though. I mean, her heart just shattered on the phone. I mean, that's. It's a scary reality, and I. And I don't want to be flipping about it. James.

[Rachel Cruze]

I'm not flipping.

[George Kamel]

No, I know you're not. I'm just saying in general, because we can, or I feel we can say something on the side of the desk. And then we move on to the next call about mutual funds. Right? And here she is picking up this reality that maybe has not been said out loud before to her till now. I mean, there's a reality that's gonna play out for her that's very real and very hard. Jane. And so I think reminding yourself of, you're not the crazy one. You're not in the wrong. What you're asking him to do is not over the top or bizarre. Like, you are the sane one in this. And if he cannot participate in sanity and continues to live in insanity, you can't live your life like that. And so we are here for you. I just. I don't know. I just felt for her just then. I just feel like.

[Rachel Cruze]

Amen.

[George Kamel]

That's so difficult, Jane. In 28 years. I mean, you just feel like you're. Yeah. Your life just kind of just shatters. And because of his behavior, and if he's changed or something's happened, I don't know if you could get to the bottom of it, of what's going on. But if he refuses to change, you cannot change him.

[Rachel Cruze]

You can't make people do stuff.

[George Kamel]

No.

[Rachel Cruze]

And that's why so many addictions. Addicts end in divorce.

[George Kamel]

I wonder if day trading. Not to put day traders in that level, but it's some level of like.

[Rachel Cruze]

Definitely.

[George Kamel]

You know what I mean? It's the same. It's like the same hit of like a gambling or exactly what it is, what that is. Like, there's.

[Rachel Cruze]

It's a dopamine. It's high.

[George Kamel]

Yeah.

[Rachel Cruze]

And, you know, it's like pulling the arm on the slot machine, walking up the craps table. It's the same stuff. It's setting up the same cycle. It's feedback loop. And Easter talks about it in his book Scarcity Loop. And Scarcity Loop talks about exactly how this is going on. What's going on. Cause when a guy is so wrapped up in that or a person is so wrapped up in that that they can't look at their spouse of 28 years and listen.

[George Kamel]

Right. That's what makes me mad for her. Yes.

[Dave Ramsey]

But she can't. And she can't make him do it.

[Caller Jane]

No.

[Rachel Cruze]

The only thing she can do is make him wish he had done it. That's the only thing she can do. And it's just. And protect herself.

[George Kamel]

I was gonna say, Jane, that's my number one step for you, is I'm so glad you have that other account. And I would be taking my name off things.

[Dave Ramsey]

And, I mean, it's different, but it

[Rachel Cruze]

does always help me to go to the extreme and say, okay, if he's

[Dave Ramsey]

doing cocaine and we had the exact

[Rachel Cruze]

same set of verbiage.

[George Kamel]

Yeah.

[Dave Ramsey]

What would you do?

[George Kamel]

Right.

[Caller Richard]

Right.

[Rachel Cruze]

What would you do?

[George Kamel]

Right.

[Dave Ramsey]

Because it's exactly.

[George Kamel]

Whatever.

[Dave Ramsey]

It's still a misbehavior.

[Rachel Cruze]

Okay. Still, I'm screwing around and I'm messing up my whole life, and I'm messing up my wife's life and my kid's life. Okay. So call it what you want to call it. But if you're doing cocaine, you sat with a pastor and he goes, I'm not going to talk. I don't believe in counseling and I'm not going to give you any more money for drugs. Then I'm not going to talk to you and I'm going to shut you out. It's like that's all language of an addict.

[George Kamel]

Yeah.

[Dave Ramsey]

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[Rachel Cruze]

Nancy's in Los Angeles. Hi, Nancy. How are you?

[Caller Tammy]

I'm good.

[Rachel Cruze]

Thank you for taking my call.

[Caller Nancy]

I really appreciate your advice.

[Caller Jane]

Sure.

[Caller Tammy]

Yeah.

[Rachel Cruze]

My fiance, he's.

[Caller Nancy]

He's 71 years old and I'm 56. We're getting married in the Catholic church in October. He wants a prenup and I don't. He's retired, has 2 million saved and a house paid off. The house is worth $700,000. I'm still working. I have $600,000 saved. Neither of us have debt. He lives in San Francisco. I'm in Los Angeles. You know, I don't. I want. I just want to walk to the altar with him and marry our lives together. And I just. I would like your advice because,

[Caller Steven]

you

[Caller Nancy]

know, I want to build a life with him. And I think for me to leave my home, my security, my job, and be a visitor in his home with a prenup, you know, it doesn't feel like a marriage to me.

[Rachel Cruze]

What's your home? What's your home worth?

[Caller Nancy]

No, I, I'm in an apartment. I live in Los Angeles.

[Rachel Cruze]

Oh, so you don't. You just. You mean you just leave your. Yeah.

[Caller Steven]

Okay.

[Rachel Cruze]

You're not leaving a home that you own just so you have $600,000 saved and you make what at your job.

[Caller Nancy]

Six hundred and sixty thousand dollars a year.

[Rachel Cruze]

Okay.

[George Kamel]

And he's retired. He's not working.

[Rachel Cruze]

He's 71. And you're 56.

[Caller Nancy]

71.

[Rachel Cruze]

I'm 56, yeah.

[Caller Carrie]

Okay.

[Rachel Cruze]

Okay. What would make you comfortable in the prenup other than all or nothing? You're assuming he wants all or nothing, right?

[Caller Nancy]

Yeah, he's just nervous because he's 71 and wants to protect. And I said, listen, I want to go. Catholic is forever. You know, when you get married in the church, we don't prepare for divorce. And I don't. I don't want to prepare for divorce because that. Creating that situation and that kind of fear walking down the aisle together and. And he's worried about his investments and losing half of what he's made because he can't go back to work. Right. We both love each other fiercely. And.

[Rachel Cruze]

Yeah. We don't recommend prenups except where there's extreme differences in net worth. And this is an extreme difference in a net worth. And so I don't know why it represents. I understand Catholicism, and I understand marriages forever, and I don't have a problem with that. And I understand that you are somewhat vulnerable if you leave your job and then he decided he wanted to put you out and keep his 2.7, and you had your 600 and you had to start over at 58 years old two years from now. That's not fair to you. But the prenup could say that you got 500,000, but just not half of 2.7.

[Caller Nancy]

And also, I'm leaving Los Angeles, my home, my family, my work, my.

[Caller Carrie]

My whole.

[Rachel Cruze]

You're leaving a $60,000 job and an apartment in Los Angeles. So financially you're not leaving anything.

[Caller Nancy]

I work in the entertainment.

[Rachel Cruze]

I'm sorry.

[Caller Nancy]

Which doesn't really exist up there.

[Rachel Cruze]

I'm sorry, say one more time. You were. You're muffled on that.

[Caller Nancy]

Work in the entertainment industry also, which doesn't really exist up there where he's at.

[Rachel Cruze]

Okay, that's fine. So you're giving up a $60,000 job to move in with a multimillionaire and be married to him. And if you get a divorce, you would want something to start your life over with to offset that 60,000. And I just said, you know, the prenup could say a half a million dollars of his money goes to you. At that point, you'd have 1.1 million and looking for a job. I think you could survive. I'm not suggesting that that's going to happen in this situation. Statistically, it's much more likely that he dies than you get divorced. Agreed.

[Caller Nancy]

Yeah. I never see us getting divorced.

[Rachel Cruze]

And yeah, I mean, I don't see you getting divorced either, but I'm just saying. So what happens to his money when he dies?

[George Kamel]

In your mind, does he have grown kids?

[Caller Nancy]

Oh, neither of us have children. Yeah, this is. This is. The prenup is just for.

[Rachel Cruze]

I know. I'm asking you what have the discussions been? What happens to his money when he dies?

[Caller Nancy]

We haven't discussed that, but that would

[Rachel Cruze]

be something to know. That's much more likely to happen than divorce. I'd really want to know that.

[Caller Nancy]

Right, right. I'm sure it would go to whichever spouse is alive at the time.

[Rachel Cruze]

I'm not sure he wants a prenup.

[Caller Carrie]

Right.

[Rachel Cruze]

So let me just tell you, I'm going to. I'm just going to throw. We're just being cold and calculated, not romantic. Okay. Because you called and asked about this.

[Dave Ramsey]

You called Dave, we'll let Rachel do

[Rachel Cruze]

the romance, but I'm too old for that. But the deal is he's 71, you're 56. I'm going to give you a 90% probability he dies before you or before you got divorced. In that case, there's a 90% chance you should be a lot more worried about what happens to this money on death. And you haven't even discussed that.

[Caller Nancy]

Right?

[Caller Zoe]

I mean, we've discussed a living trust,

[Caller Nancy]

and I guess that's where that would take effect.

[Rachel Cruze]

Yeah, but living trust can have a different beneficiary. Does all the money come to you at death? If it does, that changes the discussion on the prenup a little bit. But I don't know, to answer your question, overall, I don't think it's uncatholic. I don't think it's lacking in commitment when there's an extreme difference in asset base to get a prenup.

[Dave Ramsey]

If you were two 22 year olds

[Rachel Cruze]

that were broke and he wanted a prenup for his collection of Pokemon cards, I would tell you not marry him. Okay? Because he's not committed to the thing. But you're not two broke 22 year olds. The guy has $3 million almost.

[Dave Ramsey]

You got almost a million dollars.

[Rachel Cruze]

And you're too grownups to say the least. And so, yeah, it would be normal to get a prenup in your situation. I don't think what he's asking for is completely unreasonable. But it would also be normal to offset your question, that in the event

[Dave Ramsey]

of a divorce, you did get something

[Rachel Cruze]

substantial of his to offset your question,

[Dave Ramsey]

what you gave up in Los Angeles.

[George Kamel]

That's right. That's right. Absolutely. Yeah. And I think, and it feels like 20, 30 years ago, the automatic knee jerk reaction to a prenup is, oh, gosh, I'm preparing for divorce. I'm preparing for divorce. And as we just talked about this, right, as time's going on, they're becoming more and more common. And probably out of some wisdom, maybe not all by any means, but in some situations, the wisdom in it of planning for him. Because if I'm in his seat and I've built this and I'm not able to go back to work and something happens and half my net worth is gone. And the thought of me having to go figure out how to continue to live my life. You know what I mean? Like, there's a. That makes sense to me like that on his end, too. But your knee jerk reaction, Nancy, of that, I hear that a lot, and I think that's fair. I felt that for a while, Nancy. And I don't think it necessarily means

[Rachel Cruze]

that in fairness, when we came on the Air 30 years ago, we told people, don't get a prenup if you can't combine your stuff. They're not worth marrying. Forget it. And we were just hardcore about it.

[Dave Ramsey]

But the more we went along, the

[Rachel Cruze]

more we found in coaching people that the problems that happened that a prenup

[Dave Ramsey]

does away with are more to do

[Rachel Cruze]

when there's an extreme difference in net worth. So, like, I had a lady for real call up one time, her fiance wanted a prenup to protect his sports car. And I'm like, he loves a car more than he loves you. Don't marry him. He's a twerp. And so he doesn't need a prenup. He needs a dog. And so, you know that that's different, right?

[Dave Ramsey]

But that's. But, you know, if you got 10

[Rachel Cruze]

million bucks and the other person's got

[Dave Ramsey]

zero, the other thing the prenup does is it keeps the weirdness out of the extended family. Because extended family is like, oh, she married a multimillionaire. And here comes, you know, cousin George, cousin Eddie rolls up in the rv, right?

[Rachel Cruze]

And you know, he wants to talk

[Dave Ramsey]

to the new hubby about his new plan.

[George Kamel]

Yeah.

[Dave Ramsey]

Wants to talk to you about a pizza plan. Yeah, I want to open a pizza place with hubby's money. And you're like, all that stuff goes away because you just go, I can't do anything.

[Rachel Cruze]

I got on prenup, and it helps you deal with extended family. That's nuts. And him too, for that matter. He keeps them from thinking you're a gold digger. And, you know, so where there's an extreme difference, I, we, we are good with his suggestion. But I do think you make a valid point that in the event of a divorce, the very unlikely event that you get something,

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[Rachel Cruze]

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[Caller Steven]

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[Rachel Cruze]

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[Caller Richard]

Foreign.

[Dave Ramsey]

Is in Miami.

[Rachel Cruze]

Hi, Grant.

[Dave Ramsey]

How are you?

[Caller Richard]

Hey, Dave.

[Caller Grant]

Hi, Rachel. How are you guys? Little north of that in Fort Lauderdale, but I am 24 years old. I'm making about $150,000 a year. I have a high Yield savings account set up with about 40,000 in it. But I'm, you know, maxing out my 401k. I'm maxing out my Roth IRA as well. Moved down here about 18 months ago from Arizona. So buying a boat has been on our mind. And I think I'm gonna pull the trigger on it. So take about 16 out of that 40,000 in my high Yield savings account

[Caller Steven]

and purchase a boat.

[Caller Grant]

Guess I'm just calling, right, trying to figure out, you know, I need someone to tell me it's a good idea. Just kind of thoughts and opinions. I believe it's okay, right? I am gonna start rebuilding that. You know how yield, cadence count right back up again. I'm maxing out my 401k in my, my Roth IRA. So I don't think.

[Rachel Cruze]

And you're. You're debt free except your home.

[Caller Grant]

No credit cards. I. I'm renting right now. No credit cards, no student loans, nothing.

[Rachel Cruze]

Don't even say something.

[Caller Grant]

In my money every month is my rent. No car payment.

[Rachel Cruze]

Okay, so you have no debt. You have no debt. Are you there?

[Caller Grant]

Correct? Yes, sir.

[Rachel Cruze]

Okay, just make sure you're saying that out loud. You have no debt. Okay. And you make 140.

[Caller Steven]

Yeah. Okay.

[Rachel Cruze]

And you're 28 years old and you have 40,000 and you want to use 16 of that to buy a boat.

[Caller Grant]

24 years old.

[Rachel Cruze]

Oh, I'm sorry. And you want 16 of that to buy a boat? Okay.

[Caller Grant]

Yes, sir.

[Rachel Cruze]

Well, the rule of thumb that I use and that we've taught for years, and it works pretty well. Most people grant, make the mistake of spending money, lots of money, too high a percentage of their net worth, too high a percentage of their life on things that go down in value, and then wonder why they're broke. Now, I love boats. I've got two mastercrafts. I was playing on them all weekend, throwing the grandkids around on tubes mercilessly. Okay? So I'm a boat guy, a lake guy. I'm with you. All right? But boats and cars and motorcycles and lawnmowers and sea doos, anything with an engine or wheels or a battery goes down in value. And if we have too much of our life tied up in things that go down in value, we're always going to be broke and wonder why. And we call that middle class, because middle class has a car sitting out front of the house. It cost almost as much as a stupid house, and then wonder why they're broke. Okay? That's where that comes from. Rich people don't put money and things that go down in value. That's how they got rich.

[Dave Ramsey]

So all that to say the rule

[Rachel Cruze]

we came up with was no more than half your annual income in things that have wheels, batteries, or motors. And that includes boats and cars. So what's your car worth?

[Caller Grant]

The 2008 4Runner? More than 10? Less than 15. Okay.

[Rachel Cruze]

And you're gonna spend more on a boat than you spend on your car's worth. You have 30,000 tied up, you make 140. It meets the guideline. You're not putting too much into the boat. The boat is fine. But that.

[Dave Ramsey]

That speech goes with it, that you

[Rachel Cruze]

have to use that mentality, not just go, I think it's okay to buy a boat because that's what people say. And you're not gonna borrow money. And it's not gonna be more than half your annual income in stuff that

[Dave Ramsey]

has wheels and motors.

[Rachel Cruze]

So you're fine to buy the boat. What kind of boat are you looking at for 16 grand?

[Caller Grant]

It's a fantastic deal. It's a 180 hurricane.

[Rachel Cruze]

Okay.

[George Kamel]

It's ocean boats. You're a lake boat.

[Caller Steven]

It is.

[Caller Grant]

Yes. So I'm from Arizona, so it's a whole new ballpark for me.

[Caller Richard]

Right.

[Caller Steven]

Like boats.

[Rachel Cruze]

So saltwater.

[Caller Grant]

But it's a great deal going for 20 to 18. And I said 16 and they agreed to it. I, you know, put my heart out there. My first time boat owner. It's a single engine. It's, you know, it's going to be my first time, so they agreed to 16.

[Rachel Cruze]

So you're trailering this boat with a Forerunner?

[Caller Grant]

No, sir.

[Rachel Cruze]

Oh, okay.

[Caller Grant]

I live on the marina. Oh, okay. I'll have a slip here.

[Rachel Cruze]

Okay.

[Caller Grant]

Another thing which I'm worried about.

[Caller Steven]

I am.

[Caller Grant]

I. I don't like monthly expenses. I don't.

[Rachel Cruze]

You're getting ready to have one.

[Caller Richard]

Yep.

[Caller Grant]

In terms of a boat slip. Right. Which is going to be 450 bucks a month.

[Caller Steven]

Yeah.

[Caller Grant]

Which freaks me out.

[Rachel Cruze]

Yeah.

[Caller Grant]

But I tell my girlfriend and she's like, man, you're making 150. Like. And I don't spend anything. I tell everybody I'd rather look at money in my account than look at a car or look at anything.

[Rachel Cruze]

Well, you're getting ready to have way more tied up in the boat than you have in the car. And you're using a car every day and you're using the boat occasionally. And so let me tell you. Let me tell you what not to do with the boat, because let me tell you what not to do. This will make you throw up. Don't ever figure out how many hours you spend on the boat and divide that into what it costs you, because it'll make you throw up. It'll be thousands of dollars an hour.

[Caller Grant]

Yeah.

[Rachel Cruze]

That's what you're gonna end up spending. But that's part of owning a boat. Yeah. I got the Mastercraft this weekend. I looked down. It's got 120 hours on it.

[George Kamel]

Yeah. But he said, well, yeah, and his is a 16,000. And he said he works from home in the. In the place. You know, he may be on his boat a lot.

[Dave Ramsey]

I'm not saying that.

[Rachel Cruze]

I'm just saying, you know, there's a whole lot of stuff in this that's giving me pause. Okay. I'm 24 and it's the best deal on the planet. Both of those things scare me, okay? But I think, still, I think you ought to go by the boat.

[Dave Ramsey]

I think you ought to have the experience.

[George Kamel]

I think you got it. Fine.

[Rachel Cruze]

I think you ought to do it. It's not gonna break you.

[George Kamel]

I think you've overthought it.

[Dave Ramsey]

It's not 160,000.

[Rachel Cruze]

Go enjoy it.

[George Kamel]

Yes, yes. You're fine, Grant. You are fine.

[Rachel Cruze]

Go enjoy it. And I think you're probably.

[Dave Ramsey]

A guy that asks this many questions

[Rachel Cruze]

about something like this is probably gonna be okay. It's the ones that go, I just took out a $480 boat payment for the $450 slip, and I drive a $4 car. That's the ones that kill me. Okay? So. Yeah, and we get those all the time, too. So, Grant, I think this is in the guidelines of wisdom, but in the

[Dave Ramsey]

middle of all that, we have to

[Rachel Cruze]

give you all of our speeches.

[George Kamel]

Yep. Well done, Grant. Well done.

[Dave Ramsey]

David's in San Antonio. Hey, David.

[Rachel Cruze]

What's up?

[Caller Richard]

Hey, thanks for taking my call.

[Dave Ramsey]

Sure.

[Caller Richard]

I have kind of a. I have a kind of a unique situation. I'm 74 years old, never married, no kids, lived in the same house for 45 years. No debt. Absolutely no debt. A couple hundred thousand in savings and couple luxury cars and whatnot. But my neighbor who owns the lot next to me says, dave, you know, I've been. I don't want to hurt your feelings, but we want to buy your house, and you can live in the house for the rest of your life, but we're willing to come up with a cash sum and give it to you.

[Caller Steven]

And.

[Caller Richard]

And I said, well, let me think about it. Whatever went to my family members. And then I realized you're the ace in the hole.

[Caller Steven]

Okay.

[Caller Richard]

You know, so I don't know what to do. You know, I know when I die, I'm going to be separated from the house, and my neighbor's a good neighbor, you know.

[Rachel Cruze]

Yeah. You could sell it to him with a life estate, which is what he's proposing.

[Dave Ramsey]

I probably wouldn't do that.

[Rachel Cruze]

You're still probably. You could live 20 years easy. And 20 years from now, things change a lot. So what I would do is say, tell the neighbor that for now, I'm going to put in my will instructions for the house to be sold to you for market value by the executor of the estate, and that then the proceeds will be distributed to my kids.

[Caller Richard]

I don't have any kids.

[Rachel Cruze]

I thought you Said you went to your family. Oh, family members. You said who you're leaving your money to?

[Caller Richard]

My brother.

[Caller Nancy]

And

[Caller Richard]

I have nobody to leave my money to. So.

[Rachel Cruze]

You don't have a will, do you? No, I do not. You need to get a will tomorrow, if not today.

[Caller Richard]

Really?

[Rachel Cruze]

Everyone needs a will. Yeah. And in the will you could leave instructions. The executor of the will is the one that executes the terms of the will. And when you name that person, it could be your brother. You could say, I want this money, I want this house to be sold to the next door neighbor for market value, but have an appraisal done.

[George Kamel]

Market value of like today.

[Dave Ramsey]

At that time. No, at the time.

[George Kamel]

At the time.

[Rachel Cruze]

Yeah, at the time. He can buy it at the time for market value. I'm not gonna sell it today.

[George Kamel]

Cause I think they want, they wanna

[Rachel Cruze]

lock in the price.

[George Kamel]

That's right.

[Rachel Cruze]

Yeah. No, thank you.

[George Kamel]

Well, could he like as a gift

[Dave Ramsey]

to the, he could leave it to

[Rachel Cruze]

the neighbor at that price.

[Dave Ramsey]

You could do anything you want at your will.

[George Kamel]

Yeah, yeah.

[Dave Ramsey]

But yeah, you could say put a number on it today I wanna sell for this many hundred thousand, whatever it's worth today.

[Rachel Cruze]

And I still want that in will.

[George Kamel]

Yeah. But I don't wanna sell it. Cause I want that house in my name still and all that.

[Rachel Cruze]

And I can change my will later.

[George Kamel]

Yeah. If something weird happens.

[Rachel Cruze]

Yeah, yeah. If the neighbor decides to go off, you know, go crazy over there or, you know, they die.

[Dave Ramsey]

What happens if the neighbor dies first?

[Rachel Cruze]

You know, I don't, I don't need

[Dave Ramsey]

the house in their, in their kid's name. And I've got a life estate. So there's too much that can happen

[Rachel Cruze]

over those years to a non family member situation to do a life estate. I wouldn't do a life estate, but

[Dave Ramsey]

I would do a will immediately.

[George Kamel]

Yeah. Go to mamabearlegalforms.com David and you can just do a state specific will there. It's pretty simple. But your family will, your brother will

[Dave Ramsey]

thank you, everyone will thank you.

[Rachel Cruze]

You leave a mess behind if you

[Dave Ramsey]

don't have a will.

[George Kamel]

Well done though, David. Debt free. And.

[Dave Ramsey]

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[Rachel Cruze]

I'm Dave Ramsey. Rachel Cruz, Ramsey personality My daughter is my co host today.

[Dave Ramsey]

Mary is in Raleigh, North Carolina. Hi Mary, how are you?

[Caller Tammy]

Hi.

[Caller Jane]

I'm good.

[Caller Tammy]

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller Tammy]

So I am really good with money. I would like to think I work for a nonprofit. I make enough money to get by and I am fully out of debt and I am very careful with how I spend my money. However, I have been having some health problems and a doctor sent me to get an MRI and did not explain to me how expensive it would be. I have a bill for $3,128.56. It is very far outside of my budget, obviously, and I have been trying really hard for years to save up enough money to get a decent used car and this would set me back a lot. And this is not the first medical bill to set me back. This is just the biggest one. So I've been told to either. You know, some people are saying to get on a payment plan, but I hate being in debt and even if I get on one, it's going to drag out for a very long time.

[Rachel Cruze]

How much do you have in savings, Mary?

[Caller Tammy]

I have a little over $13,000 right now in savings.

[Caller Steven]

Okay.

[Rachel Cruze]

Why did insurance not cover your MRI that your doctor requested?

[Caller Tammy]

Surprisingly, that is the bill after insurance covered quite a bit. And I have a decent insurance policy.

[Rachel Cruze]

No you don't. And you don't have a decent and you don't have a decent doctor either because an mri, you can buy an MRI in the open market if you just walk in with cash for $350 and not $3,000 after insurance paid. MRIs are not $10,000. So I'm really curious why your insurance company and this MRI place have screwed this up so badly. There should be Nowhere near this level of bail.

[Dave Ramsey]

Was it only an mri? Is that all that was done?

[Caller Tammy]

Yes, there is one MRI that was done without dye and one that was done with dye. They were both done at the same time in the same day and I was in and out in 40 minutes.

[George Kamel]

Yeah, it's super strange. Yeah, it says typical ranges is often 100 to $1,000 out of pocket, depending on your deductible.

[Rachel Cruze]

We advertise for companies at local radio stations as 350 bucks.

[George Kamel]

Usually without insurance. Cash pay is 400 to 2,500, but 3,000 after insurance. Yeah.

[Rachel Cruze]

No, something's wrong. Okay, so the first thing I want to do is I want to call my doctor's office and be nice until I don't.

[Dave Ramsey]

Be nice.

[Rachel Cruze]

We're going to start with nice, but we may not end with nice because they need to call this MRI place and they need to get your insurance straightened out because they don't need to send you over there and get your head taken off and get you ripped off acting like they don't care. Because they don't care. Stinking medical people. And so, man, just makes me mad. So after you finish wearing everybody in this story out, I want you to wear them out. I want you to give them $3,000 worth of hell. Okay? Starting with nice, but ending up with $3,000 worth of hell. The doctor, the insurance company, the. The MRI place and everybody else, because this is absurd.

[Dave Ramsey]

Okay, then if you have to come

[Rachel Cruze]

out of pocket with more than 500 bucks, I'm changing doctors and I'm probably changing insurance. And I'm never going to go back in that MRI place again. And I'm going to post online how bad a rip off they are. I'm serious. If I'm going to. If I'm going to get screwed, I'm going to have some fun with it.

[George Kamel]

Well, and also they insurance billing, all of it is notorious of either over. Yes. Screwing up something. Yeah. So I mean, and I hate to say it, I hate that we have to be such advocates for ourselves in this stuff, but call and call and have them check and they're gonna send you to this person. You gotta. I mean, it's gonna be a pain, Mary, but a lot of people, I mean, we find it all the time that there are so many errors and stuff.

[Rachel Cruze]

It takes you three hours and you save $3,000. You made a thousand dollars an hour.

[Caller Steven]

Yeah.

[Rachel Cruze]

So wear them out, girl.

[George Kamel]

Have you though, Mary, have you called?

[Caller Tammy]

Yes.

[George Kamel]

And what?

[Caller Tammy]

Yeah, I've called every office. I've called the doctor, I've called the MRI place, and I've called my insurance. And they all said that it was processed correctly, it was coded correctly. If they recoded it, it would be insurance fraud.

[Rachel Cruze]

Bull crap.

[Caller Tammy]

My next question is, do I? I agree, but do I show up in person with printed documentation and ask them to explain it to me? I'm not sure what to do next.

[Caller Steven]

Yeah,

[Rachel Cruze]

It just depends on how much you want to fight it. But I'm going to. They are ripping. They are ripping you off for a cash MRI. They're charging you 10x what they should.

[Caller Steven]

Yeah.

[Rachel Cruze]

Okay. And if you got two of them in 40 minutes, we can count that as one. We can count it as two. In which case 700 bucks. So I'm going to call and tell the office administrator, y' all are screwing me. And I'm getting ready to go to town on social media. And where you people out? I'm going to make a hobby out of you. Have you heard of Instagram? Have you heard of next door?

[George Kamel]

Yeah, but threatening them, they're not serious.

[Rachel Cruze]

Oh, it will. Yes, it will.

[George Kamel]

No, it will. I don't think it will, Mary.

[Rachel Cruze]

So I'm going to have some fun with it. If I got to write a $3,000 check, I'm having some fun with it. I'm going to bust her child.

[George Kamel]

Some of us don't have the energy.

[Rachel Cruze]

I know.

[Dave Ramsey]

If you don't want to do it, write the check.

[George Kamel]

So, Mary, Mary, I'm talking.

[Dave Ramsey]

But no, you don't put it on page.

[Rachel Cruze]

Write the check.

[George Kamel]

Write the check. Write the check. But I would. Yeah, I mean, I definitely stick up for yourself. And, and it's just a thing going forward of like, what am I gonna pay out of pocket? What is this? Let me go shop around and see what I can find. Right. I mean, it's part of that. That's part of. I mean, that's how I feel with health. I mean, you gotta advocate for yourself. But there is a point that the price is the price. Whether they're screwing you or not. It is what it is. And so, yeah, so you may have

[Rachel Cruze]

to just pay it, Mary, but I'm gonna let my doctor's office know too. I no longer trust you people.

[George Kamel]

Well, that. And if this is gonna be an ongoing thing with your medical issues, then yes, I would for sure become more informed with third party other places that can do this type of thing. Ask around. Right. Just so that you have more information next time something like this comes up. Cause it is scary if Someone's like, you need to go do this and this.

[Rachel Cruze]

But an MRI ordered by your primary physician should be covered by your insurance policy.

[Dave Ramsey]

I mean, if you have decent insurance.

[Rachel Cruze]

Yeah, you buying in a back alley or something? But I mean, it's. But I mean, if you got decent insurance, MRI ordered by your primary should be covered. Now it might fall under deductible.

[Caller Jane]

Right?

[George Kamel]

You may. That's possible.

[Rachel Cruze]

But even then. And still they overcharge. So this is a cash MRI purchase. What's the price? You know what, you could just call up anonymously and just go, hey, I'm shopping around for MRIs. Call that place and go, what do you charge if I walk in off the street for cash and then call and tell them you're going to hand that recording over to your attorney? Yeah. Oh, my God.

[Dave Ramsey]

These people. It's just a rip off.

[Rachel Cruze]

It's an absolute ripoff.

[Dave Ramsey]

Stephen is in Charlotte, but I'm not

[Rachel Cruze]

going to get to Stephen because I'm heading up on a commercial trip. I'm just trying to move on. God. Because it pisses me off.

[George Kamel]

I know it does. But some of us, we don't got that many times.

[Dave Ramsey]

We used to have the healing arts

[Rachel Cruze]

and now we have the medical industry.

[George Kamel]

The what?

[Rachel Cruze]

We used to have the healing arts and now we have the medical industry. And I'm the freaking widget.

[Dave Ramsey]

Oh, I don't want to be your widget.

[George Kamel]

And not everybody, not all medical. Not that everybody. Not all of them. No, no, no.

[Dave Ramsey]

But the system is set up that way.

[George Kamel]

There's a hard. It's a tough. Yes.

[Rachel Cruze]

It's set up that way. The insurance companies are. It's a. Yep.

[George Kamel]

Now the insurance. That's the.

[Rachel Cruze]

Yeah, I'll get on your conspiracy theory thing on this.

[Caller Susan]

Yes.

[George Kamel]

Next segment. Stick around.

[Dave Ramsey]

Health insurance is confusing on purpose. You call one company, get transferred three times, sit on hold for 45 minutes and end up more confused than when you started. That's why I recommend Health Trust Financial, their health insurance advisors who actually get to know your situation and help you find the right coverage for your life and your budget. Health care needs change as your life changes. Maybe it's a job change, the birth of a child, a new diagnosis, or you're just trying to have more margin

[Rachel Cruze]

at the end of the month.

[Dave Ramsey]

No matter your situation. Health Trust Financial shops multiple top rated insurance carriers and helps you understand what you're actually buying. I've trusted Health Trust financial for over 20 years because they help Ramsey fans make smart health care decisions. Go to HealthTrustFinancial.com today and talk to a real person without pressure or confusion. That's HealthTrustFinancial.com.

[Rachel Cruze]

So here's a good plan on your medical. Assume that no one has your back and that'll be a good start for you. Assuming the opposite sets you up for

[Dave Ramsey]

unexpected bills and rip offs.

[Rachel Cruze]

So we have sat down with people to do coaching for the last 30 or 40 years that have a list of medical bills as long as your arm and they're considering bankruptcy. And as we do a full audit on the medical bills, we often find the same charge three and four and even five times. And then we remove all of those and then we go in and we find Tylenol at $64 a pill in a hospital bill,

[Dave Ramsey]

we actually see these numbers.

[Rachel Cruze]

Okay? And there are a few people out there that have a neat side hustle

[Dave Ramsey]

that all they do is audit people's

[Rachel Cruze]

medical bills for them and make a

[Dave Ramsey]

portion of what they save them because

[Rachel Cruze]

they discover the overcharges and the duplicate charges.

[Dave Ramsey]

So don't just assume that these people

[Rachel Cruze]

have their act together.

[Dave Ramsey]

Some of it is with malice, but most of it is just unbridled incompetence. The people doing the billing are dumber than a rock. No, I'm telling you, there's no excuse for this level of incompetence. There's no excuse and it's industry wide.

[George Kamel]

I agree.

[Dave Ramsey]

Open a medical bill, automatically assume it's wrong.

[George Kamel]

But it's just like any other industry. A mechanic can screw you or they're a great guy. Right?

[Rachel Cruze]

Like there's a few great guys. They're not 100%, but there's so many bad. Just be careful.

[Dave Ramsey]

There's so many bad that don't know what they're doing or that have malice that you cannot just assume it's all, oh, they sent the bill, I just have to pay it. No you don't.

[Rachel Cruze]

First and foremost, you got to audit

[Dave Ramsey]

it before you get to that point. You don't ever enter a procedure without

[Rachel Cruze]

understanding what your out of pocket liability

[Dave Ramsey]

is after insurance is paid. And if you're going to be covering an MRI, 350 is the going rate.

[Rachel Cruze]

Walk up and tell them I'm cash out of pocket and they'll do 350. Or go to a different MRI center. There's MRI centers on every corner. They're like Baptist churches.

[Dave Ramsey]

They're everywhere. See, they're not hard to find. And you know, don't automatically assume that

[Rachel Cruze]

if your dentist tells you you need $25,000 worth of work. That.

[Dave Ramsey]

That's gospel, okay?

[Rachel Cruze]

It's not a biblical reference.

[Dave Ramsey]

It's a dentist. Not all dentists are bad. But go get a second opinion. Go get a third opinion. Go get asked the question, what can I do that's not 25,000 where I can still chew food and, you know, figure out, you know, you have to

[Rachel Cruze]

learn about this stuff when you're in it, or it will bankrupt you.

[Dave Ramsey]

The number one cause of personal bankruptcy is medical

[Rachel Cruze]

number one cause.

[Dave Ramsey]

And it's all related back to this stuff where you don't check out what

[Rachel Cruze]

you're doing, and the doctor's office half butt pays attention.

[Dave Ramsey]

They just send you over to the same old place they've always sent you to. Nobody looks at it until you look up.

[Rachel Cruze]

And 3,000 of your 13,000 you had saved for a car is gone.

[Dave Ramsey]

That's a lot, percentage wise.

[Rachel Cruze]

And it should have been 350 bucks if anybody in the whole story had paid attention ahead of time or cared enough to take care of this poor woman. It's your job to care for her,

[Dave Ramsey]

and when you don't, you deserve to lose the business.

[Rachel Cruze]

And I'm going to another doctor, and I'm definitely never going back in that MRI center. And I'm about to possibly change insurance over this because you're gonna stink.

[Dave Ramsey]

And do what the contract says.

[Rachel Cruze]

And when I come out of there with a bill that's 10x higher than I could have paid in cash, and

[Dave Ramsey]

that's after insurance, Something's wrong. Ye.

[Rachel Cruze]

So 100% chance something's wrong. But here's the thing, folks. The lesson you take from that call

[Dave Ramsey]

is you've got to preset all of this before the procedure so you know what's going on. The only exception is when there's an

[Rachel Cruze]

emergency and you don't have a choice.

[George Kamel]

Yeah, that's the hard thing, too. Sometimes something happens medically, and you just got to do what you got to do to.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

And then you still got to go

[Rachel Cruze]

back through and audit it, because you cannot assume competency, because they're not. It's the.

[Dave Ramsey]

I mean, if any of those accounting people work for me, I'd fire them.

[George Kamel]

No. Okay. And I know. I just. Yes, I hear you. I hear you.

[Dave Ramsey]

We don't triple bill people out of Ramsey.

[George Kamel]

Friends who are ner. I have friends in that industry. And there is a level of. And I wouldn't say incompetence, but complication. If they enter this, it goes to this pro. I mean, it's a. It's A lot of stuff moving parts. And do they all get it right all the time? No. And sometimes it's such a confusing process and then you go send it to the insurance companies who. I mean, it's all just medical.

[Dave Ramsey]

It might be confusing to you and me, but it's like their job. It is, it's their job.

[Rachel Cruze]

So they need to learn to do their job.

[Dave Ramsey]

That's competency.

[George Kamel]

Yeah, but when it gets sent to a different department, they use a different code that needs to be competent. That's what I'm saying.

[Rachel Cruze]

That department needs to be competent.

[Dave Ramsey]

I just feel like not saying the nurse did it. I don't know who did it.

[Rachel Cruze]

But whoever ended up sending me this bill, that's triple bill.

[Dave Ramsey]

Somebody's an idiot. Somewhere in the chain there's an idiot chain.

[George Kamel]

Okay, we got it.

[Rachel Cruze]

So there. It's there. All right.

[Dave Ramsey]

Tammy is in Houston, speaking of medical.

[Rachel Cruze]

She's got a medical situation. What's going on? Tammy, I would say is your blood

[Caller Tammy]

pressure too high for my hospital?

[George Kamel]

I'll protect you, Tammy.

[Dave Ramsey]

Can you imagine how bad it would be if it was actually my bill?

[Caller Tammy]

Okay, here it is. How can I pay for brain surgery if I'm broke?

[Dave Ramsey]

Whoa, that's a little step.

[Rachel Cruze]

So do you have it? Do you have insurance? Yes, I have a little HMO plan.

[Caller Tammy]

That's terrible. But we got it.

[Rachel Cruze]

Okay, and what type of brain surgery? Bless your heart, I am an epileptic

[Caller Tammy]

and I have taken 17 different medications and I've had four different brain surgeries and now they're just gonna go in and cut out the part of my

[Rachel Cruze]

brain that just will not stop.

[Caller Steven]

Wow.

[George Kamel]

Oh my gosh. Have well to talk about. We were just talking about on this last call.

[Caller Zoe]

Have you.

[George Kamel]

Do you know what you're gonna after insurance and everything. Do you know what is gonna cost?

[Caller Tammy]

My out of pocket max is 17,000.

[George Kamel]

17,000 and. And then anything else or it's covered past that,

[Rachel Cruze]

I think.

[Caller Tammy]

So if it's.

[Rachel Cruze]

That's the out of pocket max, it should be 100. Should be 100% after out of pocket max.

[George Kamel]

So I got 17,000.

[Rachel Cruze]

That's not a bad HMO. That's a great one.

[Caller Carrie]

Oh, good.

[Rachel Cruze]

If it's covered. If you have a stop loss at 17k, that's pretty stinking cool. Okay, so you got deductible plus 80, 20 to a certain point and then. Wow, that's good. All right. So how old are you, hun?

[Caller Tammy]

I'm 42.

[Rachel Cruze]

Wow. When do you think you're going to have this Procedure.

[Caller Tammy]

It's one of those as soon as possible. Like I said, last year, in 2025, I probably had 200 seizures.

[Rachel Cruze]

Do you have any idea actually when the surgery might be scheduled

[Caller Jane]

then?

[Caller Tammy]

Whenever we can figure it out. So my husband lost his job about

[Rachel Cruze]

a year and a half ago, and

[Caller Tammy]

our Dave Ramsey emergency fund lasted us a whole year. Me and my husband and our four

[Rachel Cruze]

teenagers, we've been doing awesome, but we're just broke.

[George Kamel]

Has he found another job?

[Caller Tammy]

He wanted to own his own business. He's been working on that, and then he didn't earn enough, and then he went and got another job in sales, but he was taking over for a guy that was retired. And so for six months, the guy got it, and then after that, all the accounts were cold.

[Rachel Cruze]

So he's trying.

[Caller Tammy]

He's like working three different jobs, but it just is taking a while.

[Caller Steven]

Yeah.

[Rachel Cruze]

Well, it sounds like you don't have a $17,000 problem. It sounds like you have a career crisis on your husband's side. Yeah. So when he solves that, the 17,000 is going to naturally be solved, right? Oh, yeah. You start, you have the surgery whenever, and you get them, the 17 as quick as you can. They'll take, you know, they'll bill you, and then you pay the bill when you can. I'm not going to tell you not to get the surgery, but. Yeah, but he needs.

[Dave Ramsey]

He's got.

[Rachel Cruze]

Not only because of your surgery, but because of your family. I mean, it's over a year now. He's not had gainful employment. He needs gainful employment, meaning he gets paid, not a pipe dream.

[George Kamel]

Yeah. And then the goal would be maybe throw 2000 at this a month and get it paid off in less than a year. Right. When it all happens.

[Rachel Cruze]

Exactly.

[George Kamel]

Oh, sorry, Tammy.

[Dave Ramsey]

Wow.

[George Kamel]

We praying for you.

[Dave Ramsey]

You're getting ready to hit the road this summer. You want to feel confident your car

[Rachel Cruze]

is ready to go.

[Dave Ramsey]

But when you don't fully understand what's going on under the hood, it's easier to either ignore something important or spend money you didn't need to. Because, let's be honest, you're not a mechanic and you shouldn't have to be. That's why we trust Christian Brothers Automotive, the official auto repair partner of the Ramsey Show. They bring clarity to car repairs and maintenance with their digital vehicle inspections. You can actually see what your technician sees, understand what needs attention now and what can wait so you can make wise decisions without second guessing. Listen, when you're counting on your car to get you where you need to be. You don't want uncertainty. You want confidence. And Christian Brothers stands behind their work with the nice difference warranty. Three years or 36,000 miles, whichever benefits you more. Go to cbac.comramsey to schedule your service and get 10% off your visit. That's cbac.comramsey 10% off up to a 250 value.

[Rachel Cruze]

See store for details.

[Dave Ramsey]

Stephen is in Charlotte. Hi, Steven. How are you?

[Caller Steven]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve.

[Rachel Cruze]

What's up?

[Caller Steven]

So I am about $70,000 in debt, and I just don't know how to

get out of it.

[George Kamel]

What kind of debt is it?

[Caller Steven]

I. What kind of debt? Credit card debt and medical debt.

[George Kamel]

How much is credit card?

[Caller Steven]

I have it. I have it broken down. Amex is 4300 and Capital One is 6800. And then I owe on my car, 25,000. I have some of the debt enrolled in a debt consolidation program. It's been enrolled for about a year and a half, but I just. I'm not seeing anything. Go away.

[Caller Carrie]

Yeah.

[Caller Steven]

So I've got stuff that's on hold that's not anywhere.

[Caller Jane]

Huh.

[George Kamel]

What's the medical debt? How much?

[Caller Steven]

So I don't have the whole total, but I have 1800, 3700, 500, 600, 40002200 and 3600.

[George Kamel]

Oh, wow. Okay. How much do you make a year?

[Caller Steven]

Hardly anything. I make about $2,200 a month. I found myself in this situation because I lost my job January 2024 because of my own stupidity. I stole from my employer. So, you know, I was fired, I was arrested, and everything's just gone downhill since then.

[Rachel Cruze]

Okay, well, what were you doing?

[Caller Steven]

What was your job? I was working for a furniture store.

[Rachel Cruze]

Doing what?

[Caller Steven]

Inventory management. Okay. I was making about 53, 000 then. And then everything was fine. All my bills were paid. I had no debt. I was able to.

[Rachel Cruze]

What's the nature. What's the nature of your medical.

[Caller Steven]

I had to go under anesthesia twice within a year just because I was choking.

I have.

I don't even know what the condition's called, something I can't pronounce. But I had to go under anesthesia and in order to not be choking anymore.

[George Kamel]

And they did a surgery, obviously, while you were under. But you're saying the bill was mostly the anesthesia.

[Caller Carrie]

Okay.

[George Kamel]

Yeah, I gotcha. What are you doing now for work?

[Caller Steven]

I work for a grocery store.

[George Kamel]

Okay. And how many hours a week are you working?

[Caller Steven]

It's 40 hours.

[George Kamel]

Okay.

[Rachel Cruze]

Full time Were you convicted of a felony?

[Caller Steven]

It was dismissed.

[Rachel Cruze]

It was dismissed?

[Caller Steven]

Yes. Because I did a pre trial intervention program.

[Rachel Cruze]

Okay. So expunged.

[Caller Steven]

Okay, Expunged.

All right.

[Caller Grant]

Yeah.

[Rachel Cruze]

All right, so that's not holding you

[Dave Ramsey]

back because it's not on your record back at all?

[Caller Steven]

No, correct. That's not on my record. You know, that took about. That took an entire year.

[Dave Ramsey]

Yeah, but so you're six months kind

[George Kamel]

of out of all of that fog, really.

[Caller Steven]

Yeah, yeah. And I have a license to sell real estate and I'm with a brokerage. But it's hard. I'm a new agent and so it's just hard. I don't, I can't make any money in it. So that's why I'm still at the grocery store. And I've got only 300 in savings. I've got nothing. I. You know, when all this happened, I drained my 401k and any of the savings I was putting everything.

[Rachel Cruze]

What is your, what is your car worth?

[Caller Grant]

The car worth?

[Caller Jane]

It's a Toyota.

[Caller Steven]

It's probably worth 37 or 38.

[Rachel Cruze]

And you owe 25.

[Caller Steven]

I owe 25.

[Rachel Cruze]

How are you paying that bill with all this other stuff going on?

[Caller Steven]

I make it work.

[Rachel Cruze]

Yeah. That car needs to be sold.

[George Kamel]

That car.

[Caller Steven]

I work, sell the car.

[Caller Nancy]

Yeah.

[Rachel Cruze]

And buy a car. Buy a car for cash with the difference for sure.

[George Kamel]

You could buy an eight thousand dollar car. Yeah. Because how much is your payment a month?

[Caller Steven]

400, 543.

[George Kamel]

Yeah. So that frees that up. That changes.

[Caller Steven]

Yeah, it was, it was seven something because it was a lease and then the lease came due or to an end. I think just this past April.

[Caller Richard]

Okay.

[Rachel Cruze]

Matthew, you make $20,000 a year, $30,000 a year. You don't need $25,000 car debt, it's killing you. So you need to sell it and get an $8,000 car that you pay cash for. And then the rest of your situation is all care. And so it's a matter of lining yourself up with some kind of a career, whether it's real estate or whether it's something else. I don't care where your income goes up because you're worth twice what you're being paid in the marketplace. You have proven that in the past and you made a mistake. You paid for it, you went through all the hell associated with it. You lost your job and now you get a restart and you start with that's gonna be part of your story in the past. But it doesn't.

[Dave Ramsey]

As a pastor friend of mine says,

[Rachel Cruze]

you're not defined by the wor. Thing you ever did. You're not defined by the worst thing you ever did. Thank goodness none of us are. It's a part of my story. I have a scar, I have a mark. It hurt. I feel guilt, I feel some shame from it, but it's not who I am. You see the difference?

[Caller Steven]

I do.

[Rachel Cruze]

You know, and so you've got to get that part emotionally, spiritually, in your rearview mirror and then go, okay, I'm

[Dave Ramsey]

18 years old again and the world says I can be anything I want to be. So now what do I want to be, Lord?

[Rachel Cruze]

And what's my next step? And, yeah, and that could be real estate. I don't care.

[Dave Ramsey]

But you don't have to live in

[Rachel Cruze]

the prison of working for half of what you're worth in the marketplace because of a past mistake. That's a self made prison.

[Caller Steven]

And I was working seven days a week. I was valeting cars. I was making some good money with that. But.

[Rachel Cruze]

No, you weren't. You were valeting cars. That's not a career.

[Caller Steven]

That was the second. That was a side job I had.

[Dave Ramsey]

Yeah, it was making some, some money to keep the wolf away.

[Caller Steven]

Some money. But.

[Dave Ramsey]

But it's not, that's not your. You don't want to be that 10 years from today. So 10 years from today, who do you want to be? Now let's start taking the steps to be that. And we'll work the side hustles or whatever to get there. But if we work side hustle, valet

[Rachel Cruze]

and cars while we're trying to get

[Dave Ramsey]

the real estate thing going, because real estate things the thing, fine.

[Rachel Cruze]

But if the real estate thing was

[Dave Ramsey]

just a thing and it's not the

[Rachel Cruze]

thing, then move on.

[Dave Ramsey]

What is it you want to be

[Rachel Cruze]

when you grow up? You know, kind of thing. Right. So we're going to send you a copy of finding the work you're wired to do. It's got a, it's got an assessment in it. I want you to take that, I want you to sit and do some time in prayer about what you're supposed to be 10 years from now and get the car sold.

[George Kamel]

Great first step, seriously, selling the car. I'm like, that's from a financial perspective is going to relieve you so much. But also, yeah, for sure. But. And I think, you know, there is a freshness still 18 months after all of this for you, Steven, that's very, very real and very honest. But I do think the more confidence and the more wins you have out in the marketplace, the more that you're gonna find this level of dignity back to who you are. And. Yeah. And if you can find that intersection with your work of what you're passionate about, what you're naturally good at and gifted at, like all of that combined, this could be seen as a completely fresh start, which is beautiful. That's the beautiful part about redemption and grace is that you get that second chance. So, yeah, we're cheering for you for that.

[Rachel Cruze]

Yeah. I got a friend of mine who was in the bottle for about 15 years and he just got his 15 year coin the other day. If you don't know what that is, if you're in 12 step Alcoholics Anonymous or any kind of a program, you get a coin for so many days, so many months, whatever. And he just got his. He's been dry for 15 years and, you know, he's extremely successful today, but he was truly at the bottom and just virtually homeless, virtually lost his family. Everything completely turned this all around and changed everything, Changed everything. And now he's again. But, you know, he is not defined by what he used to do or used to be is defined, not defined by it. You're not defined by that unless you choose to be defined. I'm not defined by the fact that I was stupid, went deeply into debt and filed bankruptcy when I was 28 years old. I learned from it. It hurt. I don't want to do it again.

[Dave Ramsey]

I don't recommend it to anybody.

[Rachel Cruze]

But it's not who I am. It's just part of my.

[Dave Ramsey]

Let me tell you what I get asked all the time, when should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking, so let's take a quick review. The fact is, term life isn't a baby step. So if anyone is dependent on your income, you need to have 10 to 12 times your income in life insurance now. And most people are surprised by how affordable term life really is, even if you're not in perfect health. Look, I understand the hesitation since most insurance companies make it more of a hassle than it needs to be. Not at Zander Insurance. They're not an insurance company. They're a broker that works for you. That means they'll shop and compare the top term life companies to find the most competitive options on the coverage for your family. For almost 30 years, I've recommended Zander for straight answers, competitive rates and coverage that actually protects your family. Call 800-356-4282 or go to zander.com for a quick and easy quote. That's Zander. If you want to go from in debt to wealthy in debt to incredibly generous, there is a shortest, quickest, most efficient path. We call it the baby steps. We have proven it with tens of millions of people to not only get

[Rachel Cruze]

people out of debt, but also into wealth, becoming baby steps millionaires.

[Dave Ramsey]

And the fastest way to do that

[Rachel Cruze]

is with a game plan. And the game plan is tied to

[Dave Ramsey]

an app called EveryDollar. You can download EveryDollar for free in the App Store or Google Play. It's gonna put you on a budget

[Rachel Cruze]

and walk you down.

[Dave Ramsey]

The Ramsey plan with personalized recommendations and

[Rachel Cruze]

coaching for your situation.

[Dave Ramsey]

Much like you were calling in here on the show.

[Rachel Cruze]

You're going to hear the same kind of stuff so going to push you to do the same kinds of things

[Dave Ramsey]

for you to win. It's not there to sell you anything. We're not going to sell you on debt.

[Rachel Cruze]

We're not going to sell you on three easy payments. We're going to sell you on the opposite. And that's getting out of debt and into wealth.

[Dave Ramsey]

Every dollar. Download it for free in the App Store or Google Play. Carrie's in Austin, Texas. Hi, Kerry, how are you?

[Caller Carrie]

Hi, I'm great. How are you?

[Dave Ramsey]

Better than I deserve.

[Rachel Cruze]

What's up?

[Caller Carrie]

Thank you so much for taking my call, Dave.

[Rachel Cruze]

I'm sorry I get so emotional.

[Caller Carrie]

I'm seeking guidance with my new situation as a widow. I'm wondering, can I buy a home elsewhere where I want to be, not where I'm at, and raise and homeschool our 7 year old daughter as we have been and then work maybe once a week or something to keep my skills up at my job and then have my retirement secured with what I have.

[George Kamel]

Oh, Carrie, I'm so sorry.

[Caller Carrie]

Oh, thank you.

[George Kamel]

Was it sudden?

[Caller Carrie]

Yes.

[George Kamel]

Okay.

[Caller Carrie]

He was diagnosed on Thursday and passed away Friday.

[Dave Ramsey]

Goodness.

[George Kamel]

Oh my gosh. Carrie.

[Dave Ramsey]

Oh, how old?

[Caller Carrie]

Completely unexpected. He had just turned 53.

[Rachel Cruze]

Oh my God.

[George Kamel]

So sorry. How long ago was this?

[Caller Carrie]

It was in May, Mid May, just the other day.

[Caller Nancy]

Wow.

[George Kamel]

Oh, Carrie. Oh, I'm so sorry. Okay, so what's your, what is the financial situation now? Did, did he have life insurance?

[Caller Carrie]

We had a, we had a life insurance policy. So there's 350,000 there. Okay. We had saved up. We have about 30,000 in the bank we had. And then I have his pension coming in. And Social Security. Social Security is very minimal.

[Caller Steven]

It's.

[Caller Carrie]

I have a seven year old daughter. We have a seven year old together. But we also have a daughter, 19, from a previous. From his previous marriage. So between my 7 year old and I, we have about 700 in Social Security and his pension will be about 4300amonth.

[George Kamel]

Okay.

[Caller Carrie]

Everything before taxes right there.

[Rachel Cruze]

And you're living in a home you don't want.

[Caller Carrie]

I do not want to. I mean, the situation is that he had just retired. I went back to work. I'd been homeschooling my daughter for three years. I went back to work full time doing contract work on the road. And he, you know, as retired, took over homeschooling and we were on out doing contracts in the hope of finding a new place to settle down because I promised that I would live in Texas for 10 years and then at that point. Okay, so where do you retired then? We would go where I want to.

[George Kamel]

Where do you want to go?

[Caller Carrie]

And I'm not sure. I honestly don't know. Possibly Utah, where I have a lot of very close and supportive family. But I don't know.

[George Kamel]

Okay.

[Caller Zoe]

Okay.

[George Kamel]

Well, that'll be the first step, right?

[Rachel Cruze]

You own the home you're in.

[Caller Carrie]

That's my. One of my biggest problems.

[Caller Susan]

We owned the home.

[Caller Carrie]

We. We paid it off years ago, but I did not have my name on it. He bought it before, the year before we got married. We paid it off together over five years. And then we never put in a whip. We didn't have a will or anything. And so now by Texas state law, the home goes 50, 50 to our daughters and I own nothing of it and only have the right to live there. And I can't do anything about it unless I want to have it completely drugged through court.

[Rachel Cruze]

Oh, I'd completely drag it through court.

[George Kamel]

Yeah. What's the home worth?

[Caller Carrie]

240.

[Rachel Cruze]

Yeah, I'm $240,000 worth of drag it through court.

[George Kamel]

Yeah. Is there a spouse? There's nothing. There's no spousal protection.

[Caller Carrie]

An attorney told me that I would. My. I would have to pay every single year to have for 11 years for my 7 year old to have representation for her to make sure anything that happens is in her best interest and that it can't be sold until she turns 18.

[Rachel Cruze]

Yeah, I think you need a new attorney. I don't know Texas law, but that answer, given the circumstances is weird. So it doesn't mean that it's not true. It might be true. Again, I'm not an attorney and I don't know Texas law. Texas has some unusual real estate laws, so. But. But I do want to most Go ahead. At this point, what, you're gonna walk away from 240 grand? No.

[Caller Carrie]

Right. I know it, it seems insane. I, I basically been told I have the right to live there for life.

[Rachel Cruze]

Yeah, I know what one attorney told you. I'm telling you I'm going to get another attorney.

[Caller Carrie]

Okay. And then with the money that I have from the life insurance, where.

[Rachel Cruze]

What do I do with that?

[Caller Carrie]

Can I put that towards another house? Am I better off to invest it for my retirement? I don't have a retirement account now.

[Rachel Cruze]

Okay. Are you able to live on $5,000 a month?

[Caller Carrie]

I could live on it.

[Caller Zoe]

Okay.

[Rachel Cruze]

So you have that coming in his pension, his social.

[Caller Steven]

Okay.

[Rachel Cruze]

And if you sell the house, half of it today, half of it goes to the 19 year old and the other half goes with you, with your seven year old.

[Caller Carrie]

Right, Right.

[Rachel Cruze]

But so you're staying there for a while. No, no harm, no foul, even though you don't want to. I'm going to, I'm gonna sit there for a minute.

[George Kamel]

Can she take the 120 and put it towards the house for. But you can't because it's the seven.

[Rachel Cruze]

The child owns the money is what she's been told. I'm. Again, I'm getting, I'm. I want some other legal advice on this. I'm not, I'm not accepting.

[Caller Carrie]

I researched on a little bit and that seems to be the truth.

[Rachel Cruze]

Yeah.

[Caller Carrie]

But I will.

[Rachel Cruze]

It may be. It may be. Okay, so let's assume that it is. Assume you're stuck with that solution. Okay. Then what I would do is this. Normally when someone passes away, what we tell the remaining spouse is try to make no major decisions for a year. Yes, if you can.

[Caller Carrie]

I will not do anything like that.

[Rachel Cruze]

If you can. Because it takes a little while. Especially with something this sudden Thursday to Friday diagnosis to death. Wow. It just comes at you so hard. It takes a little while to just be able to breathe. Yeah. And we can hear it in your voice and I don't blame you. And so what I would do is live on $5,000 a month. I would park the 350 in something very, like a high yield savings, something very innocuous and just sit there a little bit and cry. That's all I would do. And give yourself some time to breathe now, when you can breathe a little better. Six months minimum, probably closer to a year, we can make a decision about whether we keep the house or sell the house based on the information we gather between now and then. But in the meantime, just sit there it's not costing anything. And a little bit of, you know, utilities or whatever, it's not a big deal. And it might be half of it. Be your daughters. And so you do want to take care of it. Let's just sit there and get where we can breathe and then we talk about, okay, if we sell the house and move to Utah next spring when the grass gets green in Texas,

[Caller Richard]

what

[Rachel Cruze]

are we going to do? Are we going to take the 350 and put it down or are we going to invest it? And what am I going to do for my career? What were you doing? Contract. What kind of work?

[Caller Carrie]

Lab scientist.

[Caller Steven]

Okay. All right.

[George Kamel]

So if you, if you worked one or two days a week, Carrie, doing that, what extra, how much could you

[Caller Carrie]

make one day a week? I figure I can make about 1200amonth.

[Caller Steven]

Yeah.

[Caller Carrie]

In Texas. Texas does not pay well at all.

[Rachel Cruze]

Okay, but you don't even have to decide that today either. Okay, but you know, so long term, we've got some career choice that we want to do, where we want to live, what we're going to do with that particular house and what we're going to do with the 350. All right. But it's pretty easy to say, you know, if things go the way it feels like right now, you're probably going to be in Utah. You may or may not have control of some of the equity of this house. You are a cautionary tale for everyone to have a will and.

[George Kamel]

But I'd probably go 50, 50 with the money. Put some on a house, keep some in investments for retirement.

[Rachel Cruze]

Forgot to ask how old she is, but she's got a seven year old. So she's got the ability to make some money. Yeah, I don't know. I don't know. Just take your time. Just take your time, hon. I'm sorry. You're facing.

[George Kamel]

So sorry. Oh.

[Rachel Cruze]

Ladies and gentlemen, mama mama bear. Legalforms.com you can have your will done in just a few minutes. Everyone needs a will.

[Dave Ramsey]

Welcome back to the Ramsey show in the Fair Winds Credit Union studio. I'm Dave Ramsey. Rachel Cruz, Ramsey personality. My daughter is my co host. Today Matthew is in Greenville, South Carolina.

[Rachel Cruze]

Hey Matthew.

[Dave Ramsey]

What's up?

[Caller Richard]

Is it worth going back to school and going into debt for a job that will bring me more fulfillment if I have a financially viable path already in front of me?

[Rachel Cruze]

No.

[Caller Richard]

Hands down, hands down.

[Rachel Cruze]

I wouldn't go back to school and go in debt. I might go back to school. What is it you're wanting to study?

[Caller Richard]

Nursing. Eventually be a nurse. Practitioner.

[Caller Steven]

Okay.

[Rachel Cruze]

Why don't you just pay for it?

[George Kamel]

Kind of expensive.

[Rachel Cruze]

Yeah, I know, but just pay. You could do it. What do you make now?

[Caller Richard]

Right now? So I have a degree in environmental science. I've been working for nonprofits for the last several years. As fulfilling as it was, it was certainly not lucrative. So I'm kind of starting over.

[Rachel Cruze]

But I mean, environmental science has a non. Non. Has things that aren't as fulfilling but are for profit. That pay double what you've been paid.

[Caller Steven]

Yes, sir.

[Caller Richard]

So I had already transitioned. I'm currently working in medicine. I'm using an EMT certification.

[Dave Ramsey]

Oh, good.

[Caller Steven]

Through college.

[Rachel Cruze]

Will they pay? Will they not pay for your nursing degree?

[Caller Richard]

No, sir, not entirely. I would still, especially with a master's program on top, I would probably be looking at 30 or so in debt.

[Rachel Cruze]

Oh, that's not much. Okay, good. So that means you come up with 30 cash. You got this. Where are we going to get 30 cash?

[Caller Richard]

And you think that that would be worth it? Even if I can stay the course and be making a similar amount without that debt in a similar amount of time with my current company.

[George Kamel]

So the pay doesn't change when you become a nurse. You'll be paying what you're getting paid. But you think you would enjoy the nursing side way more long term.

[Caller Richard]

Right.

[Rachel Cruze]

What do you make now?

[Caller Richard]

About 45.

[Rachel Cruze]

You make a lot more than that as a nurse.

[Caller Steven]

Yes, sir.

[Rachel Cruze]

So the pay does change.

[Caller Richard]

So this is an entry level position with a company and I do see a path to increase that significantly over the next four to five years. Like doctor looking at about four to five in school to become a nurse practitioner.

[Rachel Cruze]

Okay, let me stop them. Number one, I'm a huge believer in education. That adds opportunity that's real in the marketplace. Being a nurse is an excellent field as opportunity is everywhere. Being a nurse practitioner is right next to being an md. You can do a lot of stuff as a nurse practitioner that's in the 100 to $150,000 range.

[Dave Ramsey]

A lot.

[Rachel Cruze]

Okay. We work with them every day. It's a great field. Love the idea of going there. Would I pay cash for it? It's the only way I would do it. Can I get scholarships from a hospital or a medical organization that wants me to work for them and will furnish all the pay for this? Because there's always a nursing shortage.

[Dave Ramsey]

Always.

[Rachel Cruze]

And so hospital corps always are looking for nurses and always willing to help people become nurses, especially if you commit to work for them for a while. And so I'm going to investigate those kinds of things if that's where you want to end up.

[Dave Ramsey]

I'm not making this decision purely on

[Rachel Cruze]

what you can make. I'm making the decision based on what you want to do with your life. And I'm making the decision based on what kind of opportunities you have. And again, nursing and nurse practitioner are excellent opportunities in the marketplace and have been for decades.

[George Kamel]

Yep.

[Caller Steven]

Thank you for that.

[Rachel Cruze]

But pay cash.

[Caller Richard]

I had made my initial schooling decision based around what I was passionate about and where I wanted to end up. And I ended up in a position that was not financially viable. But I understand that the return on investment for something like versing is very different.

[Rachel Cruze]

Yeah, that's true. But again, it's not going to be. We're not going to tell you to go into debt to do it. And I would not go into debt to do it. I'm going to find a way to work around that. And as an adult, going to work as an EMT inside a hospital situation of some kind that'll put you on the rolls and they'll start writing checks for scholarships, start writing checks for tuition. Even if it's not, they do it all the time.

[George Kamel]

And you pay and you work your way through.

[Rachel Cruze]

If it takes you a year longer, so what? Not a big deal. But, you know, you're not a traditional

[Dave Ramsey]

student where you just get to quit

[Rachel Cruze]

life and go sign up and work 247 on going to school. You're not 18 years old, so this is adult time now. So the way we do this is going to be different. While you earn your way all the way through it and. Or who you're working with or who you're working for. And also back to your other career. Keep in mind the career field wasn't the problem. It's just you chose to work in an underpaid situation in your field and because you were looking for some kind of a meaning in the nonprofit world. And that may or may not be there. I don't know what you were doing. We didn't get that far into it. But that's the thing.

[Dave Ramsey]

So, yeah, yeah, we're big on education. And the other thing is this too. When it comes to your nursing degree,

[Rachel Cruze]

nobody cares where you go to school.

[Dave Ramsey]

Never one time has a nurse come

[Rachel Cruze]

in to draw my blood and I say, wait, wait, wait, where's your degree from? Never once. Never once did I talk. You know, have we had nurse practitioners? We've had them as concierge. Never once. I don't know where the guy went to School. I have no idea where he went to school.

[Dave Ramsey]

My current doc.

[Rachel Cruze]

I do not know where he went to school. And he's my primary. I don't.

[Dave Ramsey]

Do you know where yours went to school?

[George Kamel]

I don't really. I don't have one.

[Dave Ramsey]

You don't have a doctor?

[Rachel Cruze]

Okay, good. You apparently don't need one.

[Caller Zoe]

Terrible.

[George Kamel]

I see my ob. I do what I need to do.

[Dave Ramsey]

Well, does your OB. You know where your OB went to school?

[George Kamel]

Sweet. Dr. Martin? No, I do not.

[Rachel Cruze]

Okay.

[George Kamel]

I do not. Yeah, I probably could. That I should know.

[Dave Ramsey]

He's virtually a family friend. He delivered half the Ramses. But.

[Caller Richard]

Yeah,

[Dave Ramsey]

but.

[Rachel Cruze]

Well, we don't. We don't.

[Dave Ramsey]

None of us know where we went to school.

[Rachel Cruze]

We love him.

[George Kamel]

And the camels. I don't know if I'm allowed to

[Rachel Cruze]

say that, but yeah. Yeah, George. Oh, he drove George. Camels, too.

[Dave Ramsey]

He's around a bunch of us, but none of us know where he went to school.

[George Kamel]

We just like him.

[Dave Ramsey]

So this idea that where you go

[Rachel Cruze]

to school matters is a lie. So what you want is the least expensive school that has a reasonably good level of knowledge that they're going to transfer to you. We don't want you to be dumb when you graduate, but we also, this idea that you came from some famous school and that is some kind of an ingredient in success is the biggest lie that has ever been told about higher education. And so nothing.

[Dave Ramsey]

The only time I've ever seen that

[Rachel Cruze]

was I graduated from the University of Tennessee and I was interviewing for a job and I went in for a job interview and I went to Middle Tennessee State University for one year before I went to ut. And the guy had on an MTSU and a Middle Tennessee ring.

[Dave Ramsey]

And I was so dumb in the interview, I went, oh, you went to mtsu. I used to go there, too, until

[Rachel Cruze]

I upgraded and went to ut. I didn't get the job.

[Dave Ramsey]

The upgrade, Yeah, I insulted a school, so I didn't get the job. But yeah, that's when it mattered where I went to school. But other than that, I don't think

[Rachel Cruze]

nobody ever cared where I went to school. All they cared was, could I help them.

[George Kamel]

Do you think, though? A small percentage of the country, when you're looking in certain industries, small, small,

[Rachel Cruze]

small, snobbish country Club, you know, 1%

[George Kamel]

of the jobs I just think of like, like hedge fund, like all those, like. You know what I mean? Like, like, yeah, if you're gonna go small, small.

[Dave Ramsey]

If you're going to get hired by

[Rachel Cruze]

a bunch of guys that went to mit, you probably should have gone to Harvard or mit. Right?

[George Kamel]

Right.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

But otherwise majority of in the real world out here where the rest of

[Rachel Cruze]

us live, nobody gives a rip.

[George Kamel]

Yep.

[Dave Ramsey]

I'm not against vacations. I'm against being broke. If you've paid off everything but the house, you've earned the right to celebrate. Come do that on the live like no one else cruise. Hang out with me and the Ramsey personalities for seven days in the western Caribbean. Join the world's largest debt free scream. Hear exclusive Ramsay teachings and more. The best cabins are filling up. Lock in your with a $600 deposit at ramseysolutions.com events or click the link in the show notes. Buying or selling a home is a high stakes proposition. We had a caller the other day.

[Rachel Cruze]

His mother in law had sold their house for 330,000. The appraisal came in at 375,000 and apparently the real estate agent had made the mistake of pricing it too low and they'd already sold the house is under contract. She lost $45,000 by choosing the wrong real estate agent.

[Dave Ramsey]

Yeah, you need a pro in your corner. A mistake in the real estate business has zeros on it. That's huge. You need somebody that knows what the

[Rachel Cruze]

flip they're doing that does a lot of transactions.

[Dave Ramsey]

High protein, high octane baby. Ramsey trusted we vet real estate agents to have the right level of experience to guide you step by step and avoid these expensive mistakes. Connecting with a Ramsey trusted vetted real estate agent is pretty easy and it's free. Just go to ramseysolutions.com agent or click the link in the description. Zoe is in Seattle. Hi Zoe, how are you?

[Caller Carrie]

I'm good.

[Caller Zoe]

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller Zoe]

I had a question. About what? I'm a college student and I was wondering what my moral obligation is to paying back my mom for the college debt so far and kind of while I'm in school and also like how

[Caller Carrie]

to tell her I just I don't

[Caller Zoe]

need her help anymore or I don't want her help with money anymore.

[Caller Carrie]

Does that make sense?

[Dave Ramsey]

So did you before you went to

[Rachel Cruze]

school and before she started paying for it, did you agree to pay it? Did you have an agreement with her?

[Caller Tammy]

I did not.

[Caller Zoe]

Technically I did not. She is a single mom and so she never really it was on never in her mind to save for me growing up and she prior a year prior for me going to school was just kind of like saying I'll take care of it. I'll take care of it. And then this last year, my first year of college, she. It seemed to be a very black male situation, and it was very much putting a loan in my face and saying, I'm doing this, I'm paying this,

[Rachel Cruze]

so you have to do this.

[Caller Zoe]

And I kind of just want to tell her to get out of all of that and help her pay it back.

[Rachel Cruze]

Yeah, well, okay. You ask if you have a moral obligation to repay someone that did something without your agreement. If you shook hands or you looked at your mom and said, mom, if you do this, I promise to pay you back, then you would have a moral obligation. If there was no discussion where you promised to pay her and she said, I'll take care of it, and she sent you to school, and then later on she decides she wants you to pay her back. No, you do not have a moral obligation.

[Caller Zoe]

Okay.

[Rachel Cruze]

Is that logical to you?

[Caller Zoe]

Yeah, that makes sense. I guess it's just when there's money kind of being like tied to someone,

[Caller Steven]

it definitely makes it difficult.

[Dave Ramsey]

Yeah.

[Rachel Cruze]

It's different when your mom's a travel agent for guilt trips.

[Caller Carrie]

Yeah, yeah, yeah.

[George Kamel]

And you might, Zoe, you know, like depending on. With the relationship and all that, you may be out of school in a few years, working and deciding, I'm going to just write her the check eventually and just so that there's nothing there just from a relationship standpoint. But at that point, someone that can't relationally have the IQ to be able to be with you. Right. And to be your mom, and that's still holding that over your head, even if you paid it, then it probably still wouldn't make her happy.

[Caller Carrie]

You know what I mean?

[George Kamel]

Like, that's an odd.

[Rachel Cruze]

Yeah, that's a strange thing to.

[George Kamel]

An odd thing to put over your

[Rachel Cruze]

kid to hang stuff on your kid's neck. So where are you in school?

[Caller Zoe]

I'm going into my second year of college, so I'm still very much in it.

[Rachel Cruze]

And so how are you going. How are you going to finish?

[Caller Zoe]

I'm going to work my way through it. Honestly, I chose to do an in state school that was cheaper in general. And my first year was more just because of housing and all that and for my loan. But this next year I'm planning on not taking out loans and paying for myself, which is also kind of the problem because she. Even though she doesn't want this loan, she still. Or guilt trips me about it. She still has like this weird want to like, push through with me, with me attaching my name to loans.

[Caller Tammy]

For the next few years.

[Caller Zoe]

And I'm, like, very against it.

[Rachel Cruze]

Yeah. So you're working and you make enough to eat and go to school?

[Caller Tammy]

Yes, I do.

[Rachel Cruze]

Good for you. What are you doing right now?

[Caller Zoe]

Well, I'm going to school for marketing, but I'm just a server. But in Seattle, I make a good amount of money to live on, and my school is cheap enough where I can afford it.

[Rachel Cruze]

Yeah, boy.

[George Kamel]

Well done, Zoe.

[Rachel Cruze]

There's not many of you, so there's a loan taken out. Whose name is the loan in?

[Caller Zoe]

It is under hers.

[Rachel Cruze]

Okay, then it's her problem.

[George Kamel]

And just for the first year. She didn't pull, like, all four years or something?

[Caller Zoe]

No, it was just the first year. And this next three years should be a lot cheaper because the housing and it's a quarter system around here, so it's cheaper in general. And so I'm just planning on paying in cash.

[Rachel Cruze]

Yeah, just tell her, say, mom, you said you were going to take care of it, so the loan is on you, and I'll pay for the rest of school. And I love you. Thanks.

[Caller Zoe]

Is there any advice you have for me having a conversation with her? Because especially right now, she's wanting me to sign a loan for the next year. Like, how does that conversation go with.

[Rachel Cruze]

Don't do it. Do not go borrow any more money, mom, because I'm not paying any of it and you don't need the load. I got it, Mom. I'll take the last three years. Thank you.

[Caller Carrie]

Okay.

[Rachel Cruze]

Please don't take out any more loans because you're going to have to pay them, Mom.

[Caller Zoe]

Yeah, yeah.

[George Kamel]

Is there any weird legal thing that her mom could still.

[Rachel Cruze]

It's a Parent plus loan. She could take the loan out in

[Dave Ramsey]

Parent plus and use it herself fraudulently,

[Rachel Cruze]

but then she's got to pay it herself. So it's all on her. But don't let her use the excuse of using the loan in any way and blaming it back on you. Just emotionally don't do that. It's not a legal problem. 100%. You're not liable for a parent plus under any circumstances.

[George Kamel]

And weirdly, Zoe, this may sound. I feel like I'm sounding like you. I'm a little paranoid. Would you. Would you text the mom after the conversation? Recapping, mom, just. Again, thank you so much for what you've done. I have the next three years going

[Rachel Cruze]

forward, and the first year Parent plus is on you because you said you had it. I don't know, send an email. And then I wouldn't do A text, I sent an email. And then print a copy of the email off and keep it in a file.

[George Kamel]

I don't know, I may do that, Zoe.

[Rachel Cruze]

It's not a legal thing, but it might come up later and go, look, mom, I told you. Look, here's what I told you. Here's what I told you. Because her memory is weird.

[Caller Zoe]

Yeah, exactly.

[Rachel Cruze]

I feel like that's a good point, Rachel. Yeah, that's not paranoia, that's a good point. Because she changed the deal once, she'll

[George Kamel]

change it again, right?

[Caller Zoe]

Yeah, for sure.

[Rachel Cruze]

Yeah. So I'll send her a little one page email again honoring thank you for the help the first year. And just a reminder, you told me that you know you had college covered. So that first year is on you. I will take care of the next three years. Please do not take out any more loans from me. I've got this covered. Thank you for what you've done for me. I love you. And just leave it at that. Something very simple. Don't try to preach a sermon at her about how she's supposed to do something. Leave all that out. I know it's in your head, but don't say it.

[George Kamel]

Yeah, and Zoe, if you need a one on one in person conversation, you can have that too. But I would just put something in.

[Rachel Cruze]

Yeah, I just want to have it in writing in case you wanted to pull it out of the file later and say, mom, look here, I clearly told you.

[George Kamel]

Zoe, what kind of school are you going to? I'm just curious.

[Caller Tammy]

I'm going to.

[Caller Zoe]

You probably have not heard of it. It's Central Washington University. Between. Yeah. Is it just like a four year, four year school?

[George Kamel]

Yeah.

[Rachel Cruze]

And you're getting a degree in marketing.

[Caller Zoe]

Marketing and entrepreneurship.

[Rachel Cruze]

Oh, you're amazing.

[George Kamel]

Good for you, Zoe.

[Rachel Cruze]

You're going to do so good.

[George Kamel]

So great.

[Dave Ramsey]

You are.

[Rachel Cruze]

You're scratch, you're scrappy. Scrappy.

[Caller Zoe]

You're good. If I have another second, I do have a question really quick, real quick, about should I transfer? Because I do make more money living where I went to high school versus where I go to school, college. Is it going to be smart for me to transfer to do online school and make more money that way or.

[Rachel Cruze]

No, I think I'd stay the course where I am right now. You've got it lined out and you can pull it off right now. If the only way you could pull it off would be online, I might. But I like what you're doing right now. I'd stick with that for today. If, if something gets crossways later. You can always switch over but and keep in mind that you know, you got to make sure anytime you're moving stuff back and forth that all the credits transfer and you don't have to start something over again. And some skills match better with others than not. So you want to be sure you check all that out if you're going to make a move. I personally wouldn't. I'd probably stay the course. Just because you've got this so dialed in, I don't want to mess with it.

[Caller Tammy]

Foreign

[Dave Ramsey]

let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near [e-mail] agent that's ramseysolutions.com. Today's Question of the day is brought to you by why Refi? One financial mistake doesn't have to define the rest of your life. If you've gotten behind and gone in default on your private student loans, why Refi can help you explore low fixed rate refinancing options and affordable payment plans. Go to yrefi.com Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[George Kamel]

Today's question comes from Cassie in Idaho. I'm on baby step two and putting all extra money each month to my student loan debt. After learning about sinking funds, I started setting aside some money to save for future expenses such as gifts, car and home repairs, property taxes, professional memberships, et cetera. My sinking fund is growing about $2,000 each month and this is separate from my starter emergency fund. Should I continue building the sinking funds or should I be throwing that extra money, including my sinking fund savings, towards the debt? Yeah, on baby step two there shouldn't be many sinking funds. I mean, I think it's smart to know if you have a car that's going to need a lot of repairs throughout your process of paying out debt, putting some money aside to build for that so that if it comes, you know you're able to. But but that's also what your emergency fund is there for. So no, I would not be doing that many sinking funds at this stage. Now once you get past baby step three, that's when you have A little bit more of that luxury to do that kind of thing. But unless you see something looming in the future that you absolutely have to do, then I would be putting every money, all the rest, towards debt.

[Rachel Cruze]

Yeah, 100%. Now, for those of you who don't know, a sinking fund is just simply a savings account within your budget. And so you're saving money for. It's a miniature savings account. You're saving money for stuff. So you're not saving money for a future car purchase while you're getting out of debt? No. You're not saving money for a trip while you're getting out of debt? No. Because you're getting out of debt. You pour everything on the debt wide open, scorched earth. So you should not have a lot of miniature savings accounts. Hardly any, to Rachel's point, while you're getting out of debt. And again, for those of you who don't know a sinking fund comes from. Actually, it's a business term when you're doing retained earnings or you got a piece of real estate as an example. For instance, if you purchase a piece of real estate and you say, well, the roof has five years of life left on this commercial building. And so you start setting Aside, you know, 20% of the cost of a roof per year so that five years from now you have enough to pay for the roof. It's a systematic savings program for repairs and replacements in a commercial building setting. That's where the phrase comes from. Or if you're in a business that uses equipment and you have 10 trucks on the road that do a heat and air H Vac repair, well, you systematically need to replace those trucks as they age. And so you would have a systematic thing in your business budget called a sinking fund that goes into retained earnings to do that. That's where it came from. And we just pulled the terminology over and put it into every dollar. And now we've got consumers with sinking funds for Christmas, which for somebody in the real estate business is probably a little bit humorous. But anyway. But that's really what it is. It's a miniature savings account for a future event. That's all it means. And means you save up for it and pay for it and you don't go into debt for it in the future.

[Dave Ramsey]

But right now, while you're getting out

[Rachel Cruze]

of debt and baby step two, you really shouldn't need a bunch of them.

[Dave Ramsey]

All right. Nathan is in Jefferson City, Missouri.

[Rachel Cruze]

Hi, Nathan. How are you?

[Caller Steven]

Oh, not too bad. How are you guys?

[Rachel Cruze]

Better than I deserve. How can we Help.

[Caller Steven]

Hey, so I got a question on, on a truck. I, I don't know if I should buy a new one or if I should just fix mine.

[George Kamel]

Okay, how much? Well, what I was going to ask how much is it to fix the truck, but what kind of truck is it? How old is it?

[Caller Steven]

It's a 21 years old 2005 Dodge Cummins. I, I have $22,500 into this truck right now and it's going to cost me at least 7, 7, 500 to get it fixed.

[George Kamel]

How much is it worth?

[Caller Steven]

Almost 30,000. Like 10.

[Rachel Cruze]

Okay. What's wrong with it?

[Caller Steven]

The transmission just went out in it.

[Rachel Cruze]

What are you using it for?

[Caller Steven]

I was using it to drive back and forth to work, but I mean now I'm just having to ride with people because I work on the road.

[Rachel Cruze]

You, you work on the road?

[Caller Steven]

Yes sir. I'm a welder on the road.

[Rachel Cruze]

Okay, so you're traveling with business?

[Caller Steven]

Yes sir.

[Rachel Cruze]

And how are you, how are you making your traveling with that you're riding with other people on the traveling or the company's furnishing your travel?

[Caller Steven]

I'm riding with other people in their own vehicles. It's not like, I mean, yeah, I'm just riding with other people.

[Rachel Cruze]

Would you have been doing that anyway or would you have been driving this old truck on the road?

[Caller Steven]

I would have been driving my own truck.

[George Kamel]

Okay.

[Rachel Cruze]

Okay. So you guys travel and do welding, is that what you said?

[Caller Steven]

Yes, sir.

[Rachel Cruze]

Okay, and normally what you would have done is just drive. Everybody drives their own car to the job site, but it's all over the place, right?

[Caller Steven]

Yes sir.

[Rachel Cruze]

Okay, what do you make,

[Caller Steven]

1, 900 a week?

[George Kamel]

Would you say 9,929, 29,900 a week? A week?

[Caller Steven]

Yes sir.

[Rachel Cruze]

Okay, so you're making 150 a year?

[Caller Steven]

Yes sir.

[George Kamel]

Good job.

[Rachel Cruze]

Good for you. That welding things working out for you, brother? All right.

[Dave Ramsey]

So is the truck paid for?

[Caller Steven]

Yes sir, I paid it off three years ago.

[Rachel Cruze]

Good for you. Okay, well a $10,000 truck, well, you don't do a $7,500 repair to.

[Caller Steven]

Okay.

[Rachel Cruze]

I would rather just sell the truck and buy a ten thousand dollar truck.

[Caller Steven]

Okay.

[Rachel Cruze]

That I don't have to repair if you want to do that. Do you have any money?

[Caller Steven]

Yeah, I mean I got money saved up, I guess.

[Rachel Cruze]

How much?

[Caller Steven]

I don't know right now like 10,000.

[Rachel Cruze]

Okay, good. And what would the truck sell for as is a couple of grand?

[Caller Steven]

A lot of people have told me like 7,500.

[Dave Ramsey]

Oh really?

[Caller Carrie]

Okay.

[Rachel Cruze]

So if you took the 10,000 you saved up, do you have any debt?

[Caller Steven]

No, sir.

[Rachel Cruze]

Good for you. Are you single?

[Caller Steven]

I got a girlfriend. I have two kids.

[Dave Ramsey]

Where's all your money going?

[Caller Steven]

Well, I don't really know, honestly. I mean, I've. I've tried to. I put a new motor in it a couple months ago. That was 9,000. I paid cash for it. I have a farm. I'm buying cows.

[Rachel Cruze]

You own the farm?

[Caller Steven]

It was. It was in a will. My. My mom passed, and it's mine now, but. Yeah.

[Rachel Cruze]

And you're buying cows on it?

[Caller Steven]

Yes, sir.

[Rachel Cruze]

Who's taking care of the cows with you on the road?

[Caller Steven]

My dad.

[Rachel Cruze]

Okay, interesting. All right, so you're putting the. How many. How much in beef do you own? What's that beef worth

[Caller Steven]

in Missouri? I mean, a cow calf pair would be like 4,500.

[Rachel Cruze]

Yeah. How many of them you got?

[Caller Steven]

I have 10.

[Rachel Cruze]

Okay, so that's like $50,000 worth of cattle right now?

[Caller Steven]

Yes, sir.

Okay.

[Dave Ramsey]

And you pay that for it or

[Rachel Cruze]

that's what it's worth?

[Caller Steven]

That's what it's worth. I did not pay close to that. Most of them was what my mom had got and.

[Rachel Cruze]

Okay, answer to your question is I would take some of your money and sell the truck and put that 7,500 with some of your money, maybe 7 grand, and buy about a 10 or $15,000 truck that's 10 times better than the one you got. That's the answer to your question.

[Dave Ramsey]

But the second thing is, you're making

[Rachel Cruze]

too much money to not know where it's going. And I don't want you to wake up 10 years from now and go, I made 150,000 for 10 years. That's $1,500,000. And I have no idea where it went. That's no way to live.

[Dave Ramsey]

So you need to know where this

[Rachel Cruze]

freaking money's going starting today.

[Dave Ramsey]

Ready, set, go.

[Rachel Cruze]

That's the grown up part.

[George Kamel]

And start investing, Nathan, if you don't have a Roth ira, start some stuff now. That's gonna set you up.

[Rachel Cruze]

Well, I'm gonna send you a copy of the book, the Total Money Makeover, which is how we teach the stuff here. The baby steps. We work you through every bit of this. Pay cash for the truck. You need an emergency fund of three to six months of expense expenses. You need to start investing 15% of your money into a good retirement plan. And you need to keep buying cows. It sounds like you're good at it. And you're a. You're making great money.

[George Kamel]

That baby step 4B. Buy some cows.

[Rachel Cruze]

Buy some cows. There you go.

[Sponsor Voice]

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[Rachel Cruze]

Our scripture of the day. First Corinthians 2, 9.

[Dave Ramsey]

No.

[Rachel Cruze]

No eye has seen, no ear has heard, and no human mind has conceived the things that God has prepared for those who love him.

[Dave Ramsey]

Katharine Huppard said, as one goes through life, one learns that if you don't paddle your own canoe, you don't move. That'll work. Fun stuff. Hey, we wish we could get to every call and question here on the show. We simply can't.

[Rachel Cruze]

There's no possible way. The lines stay jammed most of the time.

[Dave Ramsey]

You can go and get an absolute Ramsey answer by using the tool Ask Ramsey. It's our AI tool that's built and trained only on Ramsey data and Ramsey input. So you're going to get a pure Ramsey answer. Nothing from Reddit, nothing from TikTok? No, it's all Ramsey. You get the answer the same way we'd answer it right here. It's almost as sarcastic as I am.

[George Kamel]

It's the boomer.

[Dave Ramsey]

Almost. Almost as nice as Rachel is.

[George Kamel]

Right?

[Dave Ramsey]

So ask your question [e-mail] or click the link in the description or on the podcast on YouTube and it'll set

[Rachel Cruze]

you up with the AI tool Ask Ramsey.

[George Kamel]

My prayer for the future of Ask Ramsey is that you get to put in which response. You get to click which response one day and you get to be like, I need a Dave response. Or I want Rachel to tell me this. Or I want Jay.

[Dave Ramsey]

I want George's nerd response.

[George Kamel]

Yes, whatever it is. Just to get your own little flavor.

[Rachel Cruze]

See, I. I always Think they should have changed Siri for men into their. Into their wives voice for their wives

[George Kamel]

have all the answers of everything.

[Dave Ramsey]

The wife's voice is like it's saying. Because then the men will listen.

[Caller Richard]

Right.

[Rachel Cruze]

I'm just saying hypothetically.

[Dave Ramsey]

All right. Susan's in Flint, Michigan. Hey, Susan.

[Rachel Cruze]

What's up?

[Caller Richard]

Hey.

[Caller Susan]

How are you guys today?

[Dave Ramsey]

Better than we deserve.

[Rachel Cruze]

What's up in your world?

[Caller Grant]

Good.

[Caller Susan]

Glad to hear it. Well, the question I have. We lost my dad back in January, so unfortunately, there's been a little bit of a shift in, you know, the income mom has coming in. Now. We wanna. Everybody agrees we want to keep her, you know, in the home that they've lived in for, you know, 60 plus some years.

[Caller Grant]

Wow.

[Caller Susan]

And in order to do that, they put mom on an extremely strict budget. Dad kind of spoiled her, maybe spent money they didn't have to spend, and she would just ask and get. So this is what the siblings that are managing her plan. This is kind of what they're up against. But they've done a complete U turn. And, you know, Basically she's given $100 a week to live on for, and she's now in a situation where she needs to buy depends and she needs to buy insurer drinks.

[Caller Tammy]

So I just.

[Caller Susan]

I have a different difference in opinion. She lives in a home that, that she could take a couple hundred thousand dollars worth of equity out of. And I wonder if they should be considering a reverse mortgage for her.

[Rachel Cruze]

No, reverse mortgages are. They're horrendous, you know, but on the.

[Caller Susan]

On the other hand, $100 a week.

[Rachel Cruze]

I didn't say on the other hand. You asked me if you should do a reverse mortgage. I said no. Yeah, wouldn't reverse mortgage. I saw the house before I did a reverse mortgage.

[Caller Nancy]

Yeah.

[Caller Susan]

Oh, gosh.

[Rachel Cruze]

They're a nightmare. See, they're an absolute nightmare that the foreclosure rate reverse mortgages is six times the normal foreclosure rate.

[Caller Susan]

Okay. And I haven't, in all fairness, I haven't really researched it.

[Rachel Cruze]

Does she not have any other assets?

[Caller Susan]

Well, they live their life, they traveled a lot, and dad had even gone to the bank with the idea that he was getting to the point where he might need to take some. Some equity out of their home to finish out their life.

[Rachel Cruze]

So the answer is she has no other assets.

[Caller Susan]

She has about $31,000, but out of that, they're having to take 1500amonth to pay her bills.

[Rachel Cruze]

What's her. She doesn't have Social Security coming in yeah.

[Caller Carrie]

Yep.

[Caller Susan]

She's got a total of 1450 coming in and I've not run through her entire budget. My sister manages her bills, but I guess she's got, with the amount of money that's giving her, given her and my sister who cares for her, that's a total of 250 a week.

[Rachel Cruze]

And how old is your mom?

[Caller Susan]

My mom is soon to be 86, in fact, back in the hospital again. She's, she's not in the greatest health and she's got the onset of dementia. The thought of pulling her out of

[Rachel Cruze]

her house right now, I wouldn't do that. I think, I think your sister, I think your sister is probably doing a pretty good job.

[Caller Susan]

Yeah, she works hard. It's challenging, not always easy for her when you have six brothers and sisters that, you know, that judge everything that you do. But yeah, they're managing.

[Rachel Cruze]

Yeah. You know, your parents didn't leave much, but they used it all up right to the end. But with sadly, I'm so sorry about your dad, and sadly with what you're telling me about your mom, this is probably not a long term proposition. Would you agree with that?

[Caller Susan]

I would agree with that.

[Rachel Cruze]

I'm sorry to say that out loud, but no, no, it's reality. You know, it might be a year or two, but it's not, it's probably not five, statistically.

[Caller Carrie]

Yeah.

[Caller Susan]

And my thought is, with that being said, why not yank a little bit of money out of her house so that, you know. And she doesn't want to spend money on herself. She wants, because there's a lot of us kids, a lot of grandkids.

[Rachel Cruze]

She wants to be able to feed

[Caller Susan]

them when they come over. And a lot of times that might be ordering a meal out because she's not.

[Rachel Cruze]

So the six children don't have any money, you and your brothers and sisters.

[Caller Susan]

Okay, I'm glad, I'm glad you went there, Dave, because that would be a part two of my question. Most of us are just average people. We pay, a couple of us chip in pay for house cleaning every month because it's a pretty decent sized house so that my sister can devote her time to mom. But long story short, I do have a brother out there that's a multimillionaire and he has done, he's done a lot in the sense that he gives generous Christmas gifts and he would be there in a minute if I would

[Rachel Cruze]

just make a proposal to everybody that we try to put together, you know, a thousand dollar a month budget between six of us or a $600 a month budget between six of us and add to that hundred dollars and doesn't need a lot, but just a little bit to be able to get through because it doesn't sound like we're that far off. And I just hate to. I'm not gonna tell you to get a reverse mortgage. There's no circumstance I'm gonna use it. It's a piece of crap. If you were gonna do something, I'd go get a little home equity loan, you know, for 50,000 bucks or something. But I think you're gonna regret doing that when you're just a few hundred bucks a month off. And so, you know, $10,000 a year changes this. That's 800 bucks a month. That changes this dramatically.

[George Kamel]

If everyone pitched in 100 bucks or something.

[Rachel Cruze]

And that's probably what I would do. And everybody doesn't have to put in the same amount. And some maybe can't put in anything.

[Caller Nancy]

But just.

[Rachel Cruze]

So guys, I think if we could put together 500 or $1,000 a month, mom would be great. And let's just, you know, let's all agree on what portion of that you can put in and what portion you can put in. And maybe the multimillionaire brother will pick up the balance. I don't know. I would if I was in that situation. Because especially the. Cause it's not a long. Sadly, it's not a long term proposition. Right.

[Dave Ramsey]

That's a sad thing to say out loud.

[George Kamel]

Sure, sure. But it's. Yeah.

[Rachel Cruze]

Doing a mathematical statistical analysis and sadly, we step on people's feelings when we do that.

[George Kamel]

But that's because a thousand bucks a month out of her 31,000 that she has lasts a little over two and a half years. You know, so you could take.

[Rachel Cruze]

You know what? I could do that.

[George Kamel]

Take some more money.

[Rachel Cruze]

When that money's gone, then we step in.

[George Kamel]

Yeah.

[Rachel Cruze]

You know, she doesn't really need. I mean, of course, if she has a medical event or something, then we gotta step in and cover the 31,000. Either way, it's 612 dozen other. But I'm probably gonna use that up and.

[Dave Ramsey]

Or some of it.

[Rachel Cruze]

Maybe take it down to 10, maybe make 21,000 the next 21 months. Let's see where we are after 21 months. And not aimed at you, Susan, because you've had the right tone about every bit of this as we're talking about it, but aimed at everybody. El. Because I'm at the stage where we've got older parents and siblings taking care of older parents and so forth. And my wife and I have a rule, and I recommend it to all of you. The brother or the sister that's on site doing everything. You guys shut up and help them, support them. Don't bitch at them. Stand by them. That's not aimed at you, Susan. You weren't doing that. But everybody, the one that's over there doing the stinking work, taking care of somebody, take care of them.

[Dave Ramsey]

That puts this hour of the Ramsey

[Rachel Cruze]

show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of peace, Christ Jesus.