Common Sense Beats Clever Money Hacks

Summary

The Ramsey Show: "Common Sense Beats Clever Money Hacks"

Episode Date: August 5, 2026
Hosts: Dave Ramsey & George Campbell

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Episode Overview

In this episode of The Ramsey Show, Dave Ramsey and George Campbell take live calls, offering practical, no-nonsense financial advice focused on building wealth through common sense over flashy money hacks. Together, they help callers navigate career crossroads, big financial decisions, buying real estate, confronting debt, and managing family expectations. The theme is consistency and straightforward action—“normal is broke, and common sense is weird.”

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Key Topics & Discussions

1. Career Choices vs. Side Hustles

[00:46 – 09:01]

• Caller Michelle, a single mom living paycheck to paycheck, wonders if switching careers (to real estate or esthetician) will fix her financial stress.

• Dave's Advice: Her $85K–$100K potential in sales far surpasses what most estheticians—and even most real estate agents—earn. He pinpoints the real issue: a short-term cash flow gap.

• Key Quote:

  • Dave: “Today’s problem is rent. And that’s not solved by anything we’re talking about except a side hustle.” [04:05]

• Actionable Tips:

  • Stick with the sales job, ramp up commissions, use a detailed budget to cut costs.
  • Find a side hustle that lets Michelle leverage her sales skills (“Car sales on the weekend?” [06:23]).
  • Use Ramsey’s Side Hustle Quiz for targeted ideas.

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2. Checks and Balances for Major Purchases (Homebuyers)

[10:20 – 19:34]

• Caller Grace is baby step 7, debt-free, considering whether to buy a new, bigger home.

• Framework for buying:

  • Don’t borrow more than a 15-year fixed-rate mortgage.
  • Payments should not exceed 25% of take-home pay.
  • Strive for 20% down.

• Memorable Teaching:

  • Dave: “The person with the most options, information, and patience always wins.” [18:58]

• Advice:

  • Patient negotiating is key; start with a low offer to help a motivated seller (“I can set you free, man. You got no walking money, but you’re set free.” [14:05])

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3. Downsizing During Transition

[24:32 – 30:46]

• Caller Linda laid off with $90K severance, wonders if she should downsize her home for security.

• Dave’s Take:

  • Don’t make a drastic, permanent move for a temporary problem.
  • “That’s a drastic measure for a temporary problem. That’s sort of a last—worst, worst-case scenario.” [25:48]
  • Seek a new job first (and aim for a better salary).

• Encouragement:

  • “It’s human nature when you’ve been devalued by a stinking corporation to think that you’re not worth it. ... I know you’re worth it.” [27:56]

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4. Prioritizing Kids' College Funds vs. Mortgage Payoff

[32:55 – 39:28]

• Caller Kirsten: When to stop funding 529 college plans in favor of accelerating mortgage payoff?
• Analysis: Use future value calculators to forecast college savings growth and stop funding before overfunding.
  • Dave: “I don’t want to over fund a 529...if you do a side deal...you could just hand it to them if they don’t need it for college.” [36:16]
• Practical Tip: Coordinating multiple accounts for multiple kids, adjust contributions based on projected need.

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5. Repair or Replace the Car?

[39:35 – 42:07]

• Caller Claudia: Facing $3,000 in car repairs.
• Advice:
  • Get a second opinion from an independent mechanic (dealership usually isn’t the best deal).
  • Don’t over-invest in an old car (“You don’t put $3,000 in a $3,000 car.” [41:01])

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6. Navigating Family Cultural/Financial Expectations in Marriage

[43:54 – 51:44]

• Caller Dante, Chinese-American, faces pressure to provide a dowry ("bride price") and fund a big wedding out of tradition.
• Discussion:
  • Dave struggles with the logic of honoring expensive traditions, raising the importance of open, respectful family dialogue.
  • “I would probably sit down with her father one to one and say...the only reason I’m doing any of this is to honor you.” [50:21]
• George’s Practicality:
  • “I would get real clear on the numbers and not let this become some unlimited thing...” [49:46]

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7. Debt and Retirement Saving—Resetting “Normal”

[54:02 – 62:53]

• Caller Mike, 42, high income ($235K household), but deep in consumer debt ($187K).
• Message:
  • “If you don’t do this stuff, it’s going to catch because, you guys, you’re pretty extreme mess here.” [58:16]
  • Pause all investing, sell the expensive car, go to “scorched earth” to get debt free within two years.
  • “If you do that, you’re going to retire with millions of dollars. If you don’t...normal sucks.” [57:26]
  • “You’re going to be the old man that changed the whole thing someday. But not if you’re not the young man that changes the whole thing.” [60:22]

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8. Home-Buying in a High-Rate Market: Dispelling Myths

[66:07 – 71:57]

• Caller Brian asks about so-called “assumption loans” he’s seen on TikTok.
• Dave clarifies:
  • Most loans today are NOT assumable at original rates, and TikTok advice is often fraudulent or misguided.
  • “There is a thing in the get rich quick real estate world ... but once the mortgage company discovers that...they’re going to call the loan and foreclose.” [68:19]

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9. Should I Buy a Beater or Finance a Better Car?

[71:57 – 74:09]

• Caller Jacob: Only owns a motorcycle, needs a car for Alaskan posting.
• Advice:
  • “There are $6,000 cars that will run just fine. Get a pre-purchase inspection.” [72:54]
  • Never finance a car; buy what you can afford in cash.

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10. When Can Baby Step 4 Be “Done”?

[80:16 – 85:00]

• Caller Jordan, 30, already has $140K in retirement savings.
• Dave: Never stop investing; keep building wealth for security, future generosity, and legacy.
  • “I always have investing my whole life ... I wouldn’t tell you to stop enjoying it except for a short period of time while you’re in baby step two.” [81:04]

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11. Managing “Too Much Generosity” with a Family Nonprofit

[86:29 – 94:42]

• Caller Susan runs a nonprofit cat café to benefit her son (with Down syndrome) but is losing $4,000/month.
• Dave’s Insight:
  • “The business model of the nonprofit is not what you thought it was.” [90:58]
  • Decide how much you’re willing to subsidize; reassess the model; consider focusing efforts where the emotional and financial costs align.

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12. Paying Off Debt with Grit & Celebration

[106:37 – 111:57]

• Caller Lee, 54, pays off $38,000 in 18 months (live on-air debt-free scream!).
• Key Moment:
  • “I have gone against everybody I know...I have been living off boiled eggs and Quaker instant oatmeal.” [107:29]
  • “You changed your life. We just got to observe it.” [109:19]

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13. Parent PLUS Loan Drama

[118:32 – 126:36]

• Caller Mark: Fiancee’s parents sprung a $100,000 Parent PLUS loan “she’s expected to pay.”
• Dave: Daughter isn’t liable or even morally responsible if she never consented. But handling this will “fracture” the parent-child relationship.
  • “You can’t just come along and drop this like freaking atom bomb into my life and I’m not going to pay it.” [124:10]

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Notable Quotes & Memorable Moments

• “Normal is broke, and common sense is weird.” —Dave Ramsey [00:05]
• “The person with the most options, information, and patience always wins.” —George Campbell [18:58]
• “You don’t put $3,000 in a $3,000 car.” —Dave Ramsey [41:01]
• “If you do that, you’re going to retire with millions of dollars. If you don’t...normal sucks.” —Dave Ramsey [57:26]
• “Somebody’s got to break those curses off of my family. And it might as well be me, and it might as well be you.” —Dave Ramsey [84:17]
• Lee’s Debt-Free Scream:
  • “3, 2, 1—I’m debt free!” [111:50]

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Practical Ramsey Reminders

• Use a budget (EveryDollar app) for clarity and control.
• Big changes (home, jobs, generosity) must be rooted in reality—don’t solve a temporary problem with a drastic, permanent solution.
• Never buy (or keep) more car or house than you can afford.
• Never stop investing for retirement; options, security, and legacy matter.
• Family expectations, especially involving money, require boundaries and clear communication.

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Final Thought

This episode is a testament to Ramsey’s tough-love, you-got-this ethos: focus on what’s in your control, skip clever schemes, and apply relentless common sense. Whether digging out of debt or navigating family financial drama, perseverance, patience, and practicality win the day.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studios, this is the Ramsey Show. I'm Dave Ramsey. Your host, George Campbell, number one best selling author, Ramsey personality is my co host today. The phone Number here is 888 825-5225. The call is free and some say the advice is worth exactly what you pay for it. Michelle is with us in Austin, Texas. Hi Michelle, how are you?

[Caller]

I'm broke. How are you doing?

[George Campbell]

Appreciate the honesty.

[Dave Ramsey]

There we go. Straight to it, baby. Here we go. Oh my gosh, I love it. How can we help?

[Caller]

Okay, so single mom and I've been living paycheck to paycheck my whole life. Started listening to your show and realized there is a solution. I just have to figure out, you know, there is hope, shall I say? I just have to figure out the solution. So my question is, should I go to some small school like real estate school or esthetician school to try to better my situation?

[Dave Ramsey]

What are you doing now?

[Caller]

I'm in sales. I've been in sales my whole life.

[Dave Ramsey]

What are you selling?

[Caller]

Well, I'm selling forklift batteries for forklifts. But I just started with the company

and it's going to take me about

a year to ramp up and start making commission.

[Dave Ramsey]

And when you ramp up and start making commissions, what are you projecting that you'll be making?

[Caller]

Post around 85 to 100,000 a year.

[Dave Ramsey]

Okay, and what's wrong with that?

[Caller]

Well, right Now I'm making $65,000 a year and when I, I mean my rent went through and I'm, I'm negative

a couple of hundred dollars.

[Dave Ramsey]

Okay, so you got a side hustle issue until you get your commissions going, not a career crisis.

[Caller]

Okay.

[Dave Ramsey]

So I mean, estheticians don't make 85,000 a year, most of them. So no, I wouldn't go that direction. Real estate agents can make well in excess of 85,000. Most of them don't. But most of them don't sell a lot of houses either. So I mean, if you're going to get in the real estate business, you're going to sell a lot of houses

[George Campbell]

and it could take a while before you see some meaningful income.

[Dave Ramsey]

Now again, you're starting again, it'd be six months probably with nothing.

[Caller]

Right.

[Dave Ramsey]

So you got some kind of side hustle or you start real estate part Time while you're selling forklift batteries? I don't know, but which wouldn't be a bad idea. And you don't really have to go to real estate school to pass a real estate test in Texas unless they. They may require a pre licensing. They probably do a pre licensing class. But it's just one class or something, isn't it?

[Caller]

There's six classes that I would need to take. I actually, in order.

[Dave Ramsey]

In order to sit for the license.

[Caller]

It's one test and yes, it's six courses. Principles, one, two.

[Dave Ramsey]

But you have to. All that's a prerequisite for taking the test?

[Caller]

I believe so.

[Dave Ramsey]

Okay.

[Caller]

I started. I've done principles one and two before. I just.

[Dave Ramsey]

Okay.

[Caller]

Having a kid who couldn't finish.

[Dave Ramsey]

I don't mind you. You know, let's take those classes while we're doing this and while we're working a side hustle to make sure the rent. Let's first cover the rent and stay in the current job. And then, then once you've got that going, then if you want to go ahead and take the test, take the minimum number of classes necessary to take the test. Don't go, you know, getting a whole bunch of certifications in the real estate world until you've sold some real estate. So it's not, it's not necessary. If you find a broker that will sponsor you as your affiliate broker's license, pass the prerequisite classes, then take the test and start selling part time as your side hustle. Once you've got the battery business up to income, then that's probably a thing. And then if you can get the real estate business to take off and it passes the forklift battery business, then you drop the forklift battery business. Right. Okay, but. But I don't, I don't. Today's problem is rent. And that's not solved by anything we're talking about except a side hustle.

[George Campbell]

Yeah, there's a long tail on this. So how much debt do you have?

[Caller]

My car would be my only debt. Well, I do have about 1500 in

[Dave Ramsey]

dental work that I just had done

[Caller]

that I'm financing, zero interest. And then my car, I owe 19,000 on it.

[Dave Ramsey]

Mm, okay. Good for you.

[Caller]

And that's it.

[George Campbell]

And what's your rent every month?

[Caller]

My rent's 1500amonth.

[Dave Ramsey]

Okay, I'm gonna look at your budget into a detailed every dollar budget if I'm you and see what I can cut. And then is there any chance there's anything at the forklift business that you can do to create some extra income there while you're waiting on your commissions to come in without having to do some other side hustle.

[Caller]

No, there's nothing.

[Dave Ramsey]

Okay.

[Caller]

It's just.

Yeah.

I mean, I'm out there hunting my own. My leads.

So. Okay.

[Dave Ramsey]

Just takes a bit. You're just knocking doors.

[Caller]

Yeah, yeah, yeah.

[Dave Ramsey]

A lot of rejection. Yeah. Okay.

[Caller]

Yeah.

[Dave Ramsey]

It takes a minute to get. Takes a minute to get the book of business built. Yeah. So what can you sell? Cause you're good at selling and I can kind of tell from talking to you. I've trained salespeople my whole life. I think you're really good at it. You carry yourself very well. So what could you sell as a part time side hustle that would make bank. Car sales on the weekend?

[Caller]

What kind of sales car?

[Dave Ramsey]

Oh, never thought about that. They make money.

[Caller]

Okay.

[Dave Ramsey]

Use the used lots the quickest.

[Caller]

Okay.

[Dave Ramsey]

And yeah, if you can find a dealer that'll let you work weekends and maybe some evenings or something depending on what the hours the dealerships are running. Might take a minute to get that going too. But you got walk ups there, some of the leads, so sometimes it's fish in a barrel, right?

[Caller]

Yes. Yes.

[Dave Ramsey]

So I don't know, something like that. I'm just making this up. I'm spitballing. You're using your current skills, but I think your skill of selling is more valuable. I don't want you doing Uber eats.

[Caller]

How do you know?

[Dave Ramsey]

Well, I want you doing, I mean, if you have to, to make rent, do it right. You've been doing what it took to make it for a long time. You're a single mom. But I want you to just. I don't want you to just fall into the normal default job. What is that? You can use your skill set and your history and your experience. What were you selling before you were selling batteries, you know, that you could go back to and work part time and work their evening leads that nobody else wants to work or whatever. I don't care what it is as long as it's moral and you believe in the product. You know, I don't know. Salespeople can do a lot of different things because that's a skill of being able to interact with people and having high emotional intelligence. And it just gives you the ability to do a lot of different things.

[George Campbell]

And we actually have a great side hustle quiz, Michelle, you can take that'll help guide you on this. Ramseysolutions.com Sidehustle and that'll help you at least get Some ideas and get going on this. But I like the idea of if you can make double or triple your hourly rate instead of Uber Eats, you're doing something. You have skills in consulting, sales. That's a. That's a way better trade for your time.

[Dave Ramsey]

Thirty years ago, one of my best friends at the time was a career counselor, and he always said, gather a bouquet of flowers from those that are within reach. Oh, so what is it you automatically can do that? You can reach. Right? That's a good metaphor.

[George Campbell]

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[George Campbell]

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[Caller]

Foreign.

[Dave Ramsey]

Atlanta. Hi, Grace. Welcome to the Ramsey Show.

[Caller]

Hi. Thank you.

[Dave Ramsey]

How can we help?

[Caller]

So, trying to come up with some good checks and balance questions to ask ourselves to ensure a potential decision we're making is a good financial one, not just emotional one.

[Dave Ramsey]

Good. I like that.

[George Campbell]

The fact you're asking the question tells

[Dave Ramsey]

me you're probably okay. You're gonna be okay. Yeah, you're probably okay. But let's play with the concept for a minute because I think it's awesome. George, what do you think?

[George Campbell]

Yeah, I mean, I got a framework for spending. Is this about a big spending decision?

[Caller]

Potential home purchase?

[George Campbell]

Oh, well, the parameters we have will

[George Campbell (advertisement voice)]

help you with this.

[George Campbell]

So walk us through what you're working with.

[Caller]

So we are currently baby step seven with our home paid off. This home based off what we would be selling our home for Ideally we would after emptying a non retirement brokerage account to help with the down payment. We'd only be carrying about a 40 $50,000 mortgage.

[Dave Ramsey]

In theory which you would pay off household

[Caller]

we were thinking less than two years.

[Dave Ramsey]

What's your household income?

[Caller]

My husband's income is 140 salary and he usually gets between 20 and 40 in bonuses. We just said any bonus that comes in lump sum payment.

Okay.

[Dave Ramsey]

How old are you?

[Caller]

32 and 34.

[Dave Ramsey]

What's the current home worth?

[Caller]

400.

[Dave Ramsey]

What's the new home worth?

[Caller]

The offer we would consider is 535.

Okay.

[George Campbell]

And what's in the brokerage?

[Dave Ramsey]

It would be just under 100.

[Caller]

Yeah. We have between two different brokerage accounts. We'd be able to and part from just general savings not emergency fund. We'd be able to put together about 150. But we want to be able to give ourselves some cushion again just we'd have to put in a fence and have some expenses related to the new home. The other big factor is I'm due in three weeks with our second child.

[Dave Ramsey]

Oh. How long.

[Caller]

And that's where the emotions start playing in.

[Dave Ramsey]

Yeah. For real. How long have you been debt free?

[Caller]

We paid off our home. Actually talked to you about it in 2024amonth before our firstborn was born.

Okay.

[Dave Ramsey]

So you have a reputation of buying houses when you're pregnant. Okay.

[George Campbell]

I feel like that's just how it goes.

[Caller]

We paid off the house.

[Dave Ramsey]

You did that George.

[George Campbell]

Yeah.

[Dave Ramsey]

And I counseled you against it.

[George Campbell]

Every time we move it's like the worst possible time but that's how it goes. What's driving the urgency for this?

[Dave Ramsey]

Well why now?

[Caller]

The so we had always said we'd probably move within the next three years. Nothing super set on that. And I know it's a dick for George so I don't want to say it but like one of the things this house popped up. I don't. I'm not going to say I have this amazing opportunity but.

[George Campbell]

Oh she knows my trigger word is we have an opportunity. Yeah no that's.

[Caller]

I appreciate that I listen a lot. Are the current owner of the other house has already moved out of state and is carrying two mortgages and they're the listing agent Unprompted is who told us he is very negotiable on the price and that's where we're thinking we can get that price down to the 535.

[Dave Ramsey]

Do you know what the two mortgages total?

[Caller]

What his two mortgages.

[Dave Ramsey]

Yeah. I do not find out. That's, that's your first offer.

[Caller]

Okay.

[Dave Ramsey]

Get him out whole. That's it.

[Caller]

Okay. I know he, when I look at the selling records, he bought the house for 320.

[Dave Ramsey]

I don't care what he bought it for. I care what he sold it for. I want to sell it. I don't want to buy it.

[George Campbell]

Have you had comps run by your real estate agent to find out what this house is actually worth?

[Caller]

Yes. And he has it currently listed at 575.

[Dave Ramsey]

Yeah, here's the thing. I'm gonna, I'm low ball this guy. When the agent, when the agent unprompted, says he's desperate, I'm gonna, I'm gonna just, I'm gonna hit him at his mortgage base and get him say, look, you're. I can set you free, man. I can set you free. You got, you know, you got no walking money, but you're set free. And that's where we're gonna start on this. And I'm really good at buying real estate at a deal. I'll just tell you. So anyway, that's first thing. The answer to your original question is what is the framework? You obviously have listened a lot to this show and you know that we tell people not to take out more than a 15 year fixed rate mortgage. It's more than a fourth of your take home pay, and have at least a good 20% down payment if at all possible to avoid PMI. You've definitely destroyed all of that.

[George Campbell]

You're going like 90% down payment.

[Dave Ramsey]

You're like completely way over the top on that. The, the only thing that gives me any pause at all is number one, I have to say, anytime I. It's very rare for me to run into someone who finally got completely debt free that wants to go back into debt.

[Caller]

I don't.

[Dave Ramsey]

I know, but you're about to. And that's weird. Okay, I'm gonna say that out loud. And the other thing that's weird is you're doing all this while you're pregnant and you're gonna move while you're pregnant. And I just, you know, having.

[Caller]

We are very maxed on space at our current home.

[Dave Ramsey]

Yeah. Well, so what? You know, so will that moving truck. It'll be maxed on space, but this is going to be a little bit maxed on space and buy a house nine months after the child's born. You probably got all the cash you need and you pay cash for the same house.

[Caller]

Yeah.

[George Campbell]

But if you Said, hey, we're going to take on the 40 grand mortgage and pay it off in six months.

[Dave Ramsey]

We're not going to yell.

[George Campbell]

That's different.

[Dave Ramsey]

We're not going to.

[George Campbell]

But if it's going to take you years to pay off that, that's the part that worries me.

[Dave Ramsey]

Well, he said, she said they paid off in two years. On aver, depending on the bonuses. Right.

[Caller]

Ideally quicker is just the bonuses.

[Dave Ramsey]

Again, depending on the bonus, one or two years. None of that is dumb. You're, you're all way over in the smart column. You're all fine. I, I can't. I can tell you that Sharon Ramsey would not move while she's pregnant. That would not be something she would do. Now Whitney did it, but Georgia than me.

[George Campbell]

So you won't have to do any of the moving. That's the good news.

[Dave Ramsey]

Yeah.

[Caller]

Well, no, that's part of the budget is to get movers.

[George Campbell]

You'll be yelling at everyone else.

[Dave Ramsey]

Yeah. And. And if I can do the whole. Do the same exact deal a year from now and pay cash, I'm going to wait a year just because I don't want to be in debt even

[Caller]

six months from now. Yeah. We said even six months now.

[Dave Ramsey]

Yeah.

[Caller]

If this house popped up, we wouldn't have a hesitation.

[Dave Ramsey]

Yeah. Just because I don't want to be in debt. It's that simple. And it's like, you know, $535,000 houses in Atlanta are everywhere. And so but if you want to say, okay, Lord, if we can get it at this price, we'll lay a fleece out there, then we're going to think that we're going to call that God saying to do it and we're going to put a low ball price on it, find out what the guys to mortgages are. Maybe it's 500, maybe you got no mortgage, you scrape it all together or you dip down a little deeper into the savings than you want to and you wait on the fence a minute. I don't know, whatever it is. Right. You just kind of figure it out. But at our house we don't borrow money. So we would not have been able to do your deal. We would have had to figure out some other way to either buy it at a deal or wait on another deal to pop up an opportunity. All that. Yeah.

[George Campbell]

The goal is just how quickly can we get back to baby Step 7 if we're going to do this move.

[Dave Ramsey]

Yeah. Yeah. And there's nothing we're discussing with you that's dumb. Okay. You're very smart. You've done a great job. You guys are amazing. Congratulations. You're in the top 1%. Smart people out there, Excellent job. I'm just thinking with you that the first thing I want to do is avoid debt. And if not, how quick can I get out of it? And what are some techniques to do that? A lower price point would help. Waiting would help. And that would probably involve a different house and so on. But I'm truthfully going to have my real estate agent pull the mortgage deeds and figure out what the balances are on these things. Or call the agent who's been so forthcoming and say, okay, what are the balances on those two mortgages? And then go, that's our offer. And let him write some checks to cover his fees and stuff. Come out of pocket a little bit and you get him out of Dodge, he's in trouble.

[George Campbell]

You got the upper hand. And I've heard you say this, Dave. The person with the most information, options, and patience wins.

[Dave Ramsey]

Exactly.

[George Campbell]

And you're in that spot. The more patient you can be, the more options you have, the more information you have about the mortgages and where they're at.

[Dave Ramsey]

That was an eight hour negotiation class in two sentences right there. I try to do it again. Do it again.

[George Campbell]

The person with the most options, information, and patience always wins.

[Dave Ramsey]

Yeah.

[George Campbell]

And that's you.

[Dave Ramsey]

And this is more than one house. Gather all the information about the deal you're doing, know more about it than they know about it, and then be willing to walk away. Have patience.

[George Campbell]

Same goes for a car or literally anything else.

[Dave Ramsey]

Don't get married.

[George Campbell]

At my last house, Dave, I lowballed by 80 grand and they took it first try because I. I ran the numbers.

[Dave Ramsey]

Which means it should have gone lower.

[George Campbell]

Exactly. My real estate agent said you're gonna offend them. Apparently not.

[Dave Ramsey]

Not enough. I should have offended them a little more.

[George Campbell]

Could have done a little more damage.

[Dave Ramsey]

Sam.

[Caller]

Foreign.

[Dave Ramsey]

Back to school time means you're depending on your vehicles more than ever. Whether you're driving kids to school, helping one move into a dorm, or just managing a busy fall schedule, the last thing you need is your car to break down and throw your plans off track. That's why I recommend Christian Brothers Automotive. One of the smartest things you can do is stay ahead of potential car problems before they become expensive repairs. And Christian Brothers makes that easier. With their digital vehicle inspection, you see exactly what their technicians see, so you're not left guessing about what's wrong or wondering whether the repairs are actually needed. You get Honest recommendations and the information you need to make a wise decision. And every repair is backed by their nice difference warranty. Three years or 36,000 miles, whichever benefits you more, help your vehicle last longer. Schedule your service today and get 10% off your visit at CBAC. That's CBAC.com Ramsey 10 off up to a 250 value.

[George Campbell]

See store for details.

[Dave Ramsey]

Attention all nerds.

[George Campbell]

I'm listening.

[Dave Ramsey]

Nerds.

[George Campbell]

I've been summoned.

[Dave Ramsey]

Nerd warning. George and I are going to do the nerd event. It's called Investing Essentials. It's Dave Ramsey's playbook on investing, what I personally do, what I don't do and why. And details on real estate purchases, how I analyze all of that, how I select mutual funds. And we're going to go into a bunch of legacy stuff like how to, you know, some basics in estate planning and how to hand wealth off without ruining your kids and all of this.

[George Campbell]

The relational pieces of stuff.

[Dave Ramsey]

And I gotta tell you, if you're having trouble sleeping, sign up for this. We will put you to sleep. Unless you're a nerd, in which case you will be sitting on the edge of your seat, you'll be taking notes, and you will be run out of ink with your pen. You will just be taking notes everywhere. It's so dense. It's so full. It's so overwhelming. It's so boiling over with nerd stuff. You are absolutely going to love it, I think.

[Caller]

I'm not.

[George Campbell]

I think you really sold it there.

[Dave Ramsey]

I don't think I sold a single ticket.

[George Campbell (advertisement voice)]

Well, it's September 1st and 2nd again.

[George Campbell]

It's virtual. You can join from anywhere. And it's about two plus hours both nights. So you're getting four plus hours of content, stuff we've never really talked about. At length with the formulas and super tactical pieces.

[Dave Ramsey]

Based on going over the notes the other day with you and the gang, I'm thinking if we get out in two and a half hours each night, we're going to be doing good. You guys, we just chalked this thing full. It's everything. So you're gonna love it. And you can.

[George Campbell]

I need to watch this again. I need to take notes. We're gonna give you all that access to a replay. There's different tiers depending on how long you want the replay for. You'll even get Dave's notes along with it. With the deck, you get the slide deck as well.

[Dave Ramsey]

The slide deck alone will put you to sleep. Just put it on your TV and you'll just Go. You'll just be gone. Just like that.

[George Campbell]

And the tickets start at 199 bucks. And if you aren't at least 200 bucks richer over the course of your life from watching this stuff, then that's on you. Yeah, that's all I'm gonna say.

[Dave Ramsey]

Then you really aren't a nerd. And you should not have been here. You should not have attended.

[George Campbell]

It's one of our favorite events we do. And the people love when Dave goes deep. As much as Dave likes to joke that nobody wants to hear this stuff.

[Dave Ramsey]

Well, we've only done it. We've only done it a couple times, right? This is like the third time.

[George Campbell]

We do it, like once a year.

[Dave Ramsey]

Yeah, but I mean, just a couple times. And it's so it. And a lot of you come. There's a lot of nerds that people want to know. And even if you're not a nerd, but you aspire to be a nerd,

[George Campbell]

aspiring nerds are welcome.

[Dave Ramsey]

Aspiring nerds are welcome.

[George Campbell]

We're going to answer your questions as well.

[Dave Ramsey]

Insomniacs are welcome.

[George Campbell]

I'm going to use it for bedtime for my toddler.

[Dave Ramsey]

I promise. Kid will sleep all night. Absolutely. $199. It's a virtual event. It's September 1 and 2. You can click the link right now and go there in the show notes, or you can go to ramseysolutions.com events. All seriousness aside, that's absolutely going to be incre. You will be blown away. I'm so excited to teach this stuff because I've had trouble sleeping. All right. Linda's in Boston. Hey, Linda, what's up?

[Caller]

Hi. I'm good. How are you guys?

[Dave Ramsey]

Better than we deserve. How can we help?

[Caller]

I was laid off, and I don't know how long it will take me

to find a job.

So my question.

[Dave Ramsey]

When did you get laid off?

[Caller]

Two weeks ago.

[Dave Ramsey]

Okay. How's the job hunt coming?

[Caller]

It's.

It's interesting.

[Dave Ramsey]

What were you making before?

[Caller]

I was making a little over a hundred thousand.

[Dave Ramsey]

Doing what?

[Caller]

I was in sales or business analyst.

[Dave Ramsey]

Were you a business analyst or were you selling?

[Caller]

I was in sales operations. I support the sales organization.

[Dave Ramsey]

Okay. Wow. Why'd you get laid off?

[Caller]

Structure.

[Dave Ramsey]

Okay.

[George Campbell]

Was there severance?

[Caller]

There is.

[Dave Ramsey]

How much?

[Caller]

90.

[Dave Ramsey]

Oh, awesomeness. Okay. Now, I'm sorry, but that helps us to go. And the core of your question is, what then?

[Caller]

So, because I don't know how long

it will take me to find a job, I'm curious if I should just sell my existing home and downsize and use whatever profit from the selling of the house to buy something smaller, cash.

[Dave Ramsey]

Absolutely not.

[Caller]

No.

[George Campbell]

That's a drastic measure for a temporary problem. That's sort of a last. Worst, worst case scenario, you are up against the wall. But right now you've got some cushion. Right?

[Caller]

My seven. Yeah.

[Dave Ramsey]

Yeah.

[Caller]

Right.

[George Campbell]

And that's assuming you don't find anything.

[Dave Ramsey]

So if you get a job in six months, you just put 45 grand in your pocket. If you get a job making the same thing.

[Caller]

Yeah.

[Dave Ramsey]

You got a signing bonus. They did you a huge favor.

[Caller]

True. Yeah, well, I. Yeah, that's right.

I didn't see.

I didn't think of it that way. I think I was looking at it more as some stability since again, I don't know how long it will take me.

[Dave Ramsey]

Well, you got a year. If you call me up and you got one month left on your severance, we'll have a different discussion.

[Caller]

Yeah.

[Dave Ramsey]

But I'm also going to ask you why you suck at job interviewing. If you've been looking for a year, too.

[Caller]

But.

[Dave Ramsey]

Oh, no, no, no, no. I said if you did do that, you didn't do that. But I said if you did. If you told me I've been looking for a job for a year and I can't find a job, I'm like, you're not very good at sales. You know, I mean, this is. Yeah. So you're. But you're going to be fine because you have the people skills, right?

[Caller]

Yes, I do.

[Dave Ramsey]

Okay. And that's what's. That's what's missing out there in the marketplace. People with people skills. Most people have been raised sucking on an iPhone and they don't know how to interface with human beings.

[Caller]

Right, right. No, absolutely. Absolutely.

[Dave Ramsey]

These electronic pacifiers are killing us. So. But human beings like you and me that know how to. And George know how to work with human beings. I mean, there's a lot of stuff

[George Campbell]

you can do, which means utilize your actual physical network of people that you know, versus just applying on, you know, do not apply for jobs.

[Dave Ramsey]

Do not blindly apply for a job. It's a complete waste of calories.

[Caller]

So that was my other thing. Do I just go for the offer? So that way I have a job and.

[Dave Ramsey]

No. Yeah, eventually, but. And I want you to pick up something, do something if you want to, but in the meantime. And I don't want you to take a job making less. I want you to take a job making more.

[Caller]

Yeah, that was my other dilemma. It's like, I don't Mean, will I have to get paid the price cut?

[Dave Ramsey]

It's human nature when you've been devalued by a stinking corporation to think that you're not worth it. That's human nature. But I've been talking to you for four minutes, and I know you're worth it.

[Caller]

Okay?

[Dave Ramsey]

So you, girl, go get $120,000 job. 120. Say 120.

[George Campbell]

That's your number.

[Dave Ramsey]

Yeah, 120. That's your number. And I want you to call me back and tell me you got $120,000 job within six months of getting laid off and put $45,000 in your pocket. Now. Now let's go back to the house for a minute. Do you like your house? It's kind of.

[Caller]

I'm single. It's four bedrooms.

[Dave Ramsey]

Do you like your house?

[Caller]

Yes.

[George Campbell]

I mean, if you still had your job, would you want to downsize anyways?

[Caller]

Yes, I would.

[Dave Ramsey]

Okay, then let's talk about downsizing. But I want to do it from a different narrative. It's from strength rather than weakness.

[Caller]

Right?

[Dave Ramsey]

There's no need to panic. You're going to get $120,000 to your job within two months from today. And you know, you can just say Dave Ramsey's a liar if it doesn't happen. You're going to do it. I can just tell. All right? And then downsize your house just because you don't like the house. Got nothing to do with being laid off by a stinking corporation.

[Caller]

Okay, that makes sense.

[George Campbell]

Just disconnect those decisions and you'll have more clarity and more patience because you're

[George Campbell (advertisement voice)]

not in a rush.

[George Campbell]

You're not desper.

[Dave Ramsey]

Don't be a motivated seller.

[George Campbell]

Sell your house for whatever reason.

[Dave Ramsey]

There's no reason.

[George Campbell]

No reason to panic and get a good agent. You can get one of our Ramsey trusted agents, ramseysolutions.com agent. And they'll actually help you price it strategically and get you out of this thing. And maybe it'll coincide. You'll be moving, entering a new job. It's a whole new chapter.

[Dave Ramsey]

That'd be okay, too. Hey, hang on. We're gonna send you a copy of the Proximity Principle, which is a book that will show you by Ken Coleman how to work the people that you have in your network to help get you into, they know somebody that know somebody. Sometimes it's just 1 degree or 2 degrees of separation that gets you in the door, not in a pile of applications. You don't want to just get in a pile of applications and call that job hunting, that's useless. So don't do that. And then the second thing we're going to send you is finding the work you're wired to do, which has an assessment with it that I want you to take just to verify what I think I already know about you. Okay? Which is you got great people skills. You know how to deal with. You've got, you know, you've got good emotional iq. And that puts you in a different position. George. Second one of those calls by a lady we got today. I need to remind America the highest paid profession is sales. Higher than doctors and lawyers and Indian chiefs. Higher than everything.

[George Campbell]

The ceiling is there.

[Dave Ramsey]

If you want to free up margin in your budget, one of the first things you should do is take a hard look at your monthly bills because every dollar you overpay is another dollar you don't have for reaching your financial and overpaying for your phone bill. Well, that makes zero sense. And it's why I recommend Boost Mobile. Their unlimited plan is just $25 a month forever. No contracts, no hidden fees, no surprise price hikes. If you already have a phone you love, you can keep it and keep your number when you switch. And if you're skeptical, Boost mobile offers a 30 day money back guarantee so you can try it risk free. Listen, your phone bill should, should fit your budget, not the other way around. Reaching your financial goals is easier when you can pay less for the same service. Switching to Boost Mobile now is just a smart money move. Go to boostmobile.com Ramsey and make the switch today. That's boostmobile.com Ramsey $25 forever requires customers

[George Campbell]

to remain active on Boost Mobile unlimited plan.

[Dave Ramsey]

Sam. Kirsten is in Fort Wayne, Indiana. Hi Kirsten, how are you?

[Caller]

Good.

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

I am. My husband and I are in baby step five and six and we're looking for advice on when to stop funding our children's 529 versus paying off our mortgage.

[Dave Ramsey]

Very cool. How old are the kiddos?

[Caller]

I have a six year old, a three year old and a nine month old.

[Dave Ramsey]

Okay. Well, I mean there's a couple things you can look at on that that I'm okay with. Either way, you've obviously done a very good job with your finances. Congratulations. Very few people get to where you are. What's your household income

[Caller]

after take home or take home after taxes and 401k? 10,427amonth.

[Dave Ramsey]

And you're how old again?

[Caller]

I am 33.

[Dave Ramsey]

Oh, wow.

[Caller]

You guys and my husband is also 33.

[Dave Ramsey]

You're going to have so much money. Oh my gosh.

[George Campbell]

How much is already on the 529s?

[Caller]

So our 6 year old has 62,000, our 3 year old has 32,000 and our 9 month old has 8,000.

[Dave Ramsey]

Are you working with a smartvestor pro?

[Caller]

Not yet.

[Dave Ramsey]

Okay. Who's doing the 529s? Y' all just DIY them?

[Caller]

Yep. All right.

[Dave Ramsey]

Because George may be able to do it fast enough. Do it as an example with the 62,000. Which ones you do?

[George Campbell]

Yeah, I can do the 62 because that's the one that's coming up first. Right.

[Dave Ramsey]

And he's 12.

[George Campbell]

12 years from now?

[Caller]

He's.

Yeah, he's 6.

[Dave Ramsey]

Well, that'll be 204,000.

[George Campbell]

If you add nothing to it, you just let it coast. If you get an average 10% return, if you're in some good mutual funds in there, 200 grand. So now you, you can kind of figure out, hey, let's say they go to an in state school. We'll factor in inflation over the next 12 years. 200 grand sounds good. Or you may decide, hey, let's put

[George Campbell (advertisement voice)]

a little bit more in to get

[George Campbell]

to 250 because there might get scholarships as well.

[Dave Ramsey]

Well, the other thing is this. I don't want to over fund a 529.

[Caller]

Yeah, that's what we're worried about is overfunding.

[Dave Ramsey]

Personally, I'm not sure 204 will be enough to send them to school, room and board included. Pretty sure it's not going to be enough 12 years from now, but it's going to be real close.

[Caller]

Okay.

[Dave Ramsey]

And he might decide to go into a trade or something and doesn't need anywhere near that. So.

[George Campbell]

And then another kid might go to a super expensive school and now we can use those funds and change beneficiaries.

[Dave Ramsey]

I'm probably not putting any more in that one.

[Caller]

Okay.

[Dave Ramsey]

And so what we just did was we just future valued, meaning if you let it grow at a 10% rate or a 12% rate or whatever number you want to use, you can use the Ramsey calculator on our website and do that. That's what George was using. Okay. @ramseysolutions.com Jump on there, it's free. Okay. And we just Future valued, what's 62,000 going to be worth in 12 years at 10%. That's all he put in. Okay. And it came out 204. And then you have to ask yourself, is that enough? I don't think it's going to be enough, but it's going to be so stinking close with the kind of income you got and the other wealth you're going to have that I really wouldn't worry about it. I think I'd probably stop that one.

[George Campbell]

That's the other factor. You guys are going to be so much wealthier 12 years from now that you can likely cash flow any gap. And if you don't use it, you can roll over up to 35 grand over time with the new Secure Act 2.0 into a Roth IRA for that kid.

[Caller]

I did see that, which is exciting.

[Dave Ramsey]

See, it's kind of a pain, though. I really. I wouldn't, I wouldn't do everything counting on that. The only advantage of a 529 versus dumping money just into the kid's name is it grows tax free. That's the only advantage. It's not that it won't grow. So you could open just a mutual fund in the kid's name. And until it reaches the point, you know, until it reaches the point that it actually pays taxes, which will be a while, but if it did pay taxes on it, you're going to lose some of it to taxes. That's the only difference. And so I'm not putting any more in that kid's 529. That one. Now do the other ones.

[George Campbell]

Yes. Figure out, for example, you'll have 142 by the time they're headed to college. So you may want to fund that one a little bit more.

[Dave Ramsey]

Yeah. What I might do is say, okay, if 204 is the baseline, I'm going to set the other two up to land at 204 based on their age, maybe with inflation. Yeah. Or maybe a little more because of that. So I wasn't that sophisticated. I'll tell you what I did, which is kind of fun just for the heck of it, because 529s weren't there when our kids were doing this.

[George Campbell]

You had education savings accounts at that point?

[Dave Ramsey]

No, they weren't even there.

[Caller]

Wow.

No.

[Dave Ramsey]

We just had utmas Uniform Transfer to Minors act, which means I just opened a mutual fund in the kid's name. And all I did was the niece is the oldest and I put her in the calmest type of mutual fund of growth and income. Rachel's the middle, so I put her in a growth and Daniel was the baby. I put him in an aggressive growth. And I didn't put as much in his because he was the baby. And it was going to grow faster, but it had more risk. And they all turned out about the same. Got really, really close.

[George Campbell]

It's a good experiment.

[Dave Ramsey]

Just generally dropping them in there and didn't touch them after that. I just dropped a chunk in there and went. And then what ended up happening, weirdly, Kirsten, is this in that case, by the time the kids got to college in our case, and this is probably what you're going to run into, they went to University of Tennessee, a state school, and I just wrote a check, cash flowed it. And when they got out and got married, I handed them that UTMA account to start their lives with. Okay, now you're gonna have to use this 529 on education. So you're not gonna be able to do that plan. But if you do a side deal and you don't end up like beyond on the oldest child that we're talking about 204 from 62. If you do a side deal and you just open a mutual fund in their name, a Uniform Transfer to Minors act. Utma. Utma then. And you can do that with your. With your Smartvestor Pro, they can help you figure all this out. Then what'll happen is you could just hand it to them if they don't need it for college. And so it's perfect to do all that. And that's how it ended up working out at our house. But again, those tools were not all available. I had to pay some taxes on their accounts as they grew.

[George Campbell]

There's more options now than ever, which is nice, but also can be overwhelming. So we're actually walking through that in our Investing Essentials event. It's all the ways you could invest for your kid. What's the best account? For what reason? Is it education? Is it a wedding? A down payment? Whatever it is, there's the right kind of account to use.

[Dave Ramsey]

Oh, we're going to cover that in the nerd event?

[George Campbell]

That's right. At least I am. I don't know what you're going to do. I plan on it because I got young kids, so I'm thinking about this all the time.

[Dave Ramsey]

Okay.

[Caller]

All right.

[Dave Ramsey]

Well, I got grandkids.

[George Campbell]

Your kids have launched.

[Dave Ramsey]

They're okay, Yeah, I got grandkids, but that means my kids have to think about it.

[George Campbell]

That's their problem.

[Dave Ramsey]

Now.

[George Campbell]

You did your part.

[Dave Ramsey]

That's fun. Oh, man. Love it. Claudia's in Washington, D.C. hi, Claudia. What's up? What's up?

[Caller]

Hi, Ramsey. So honored to be on the show. I have a big question for you. Should I Change my car? Should I repair it?

[Dave Ramsey]

What's your car worth today?

[Caller]

If it was repaired, the dealer says 12k. Carvana says 13k as is.

[Dave Ramsey]

Or if it was repaired as is.

[Caller]

Equal repairments.

[Dave Ramsey]

What's wrong with it?

[Caller]

So I just pay about 1,000 in repairments, and I need to put three more, according to the dealer, because I need to do some repairs, replacements, like wheel bearing and arm bushes, something like that. That will be a total 3,000 more dollars that I'll have to pay. So should I put that amount towards.

[Dave Ramsey]

I don't think it's going to make your car worth $3,000 more.

[Caller]

You don't think so, do you?

[Dave Ramsey]

You think the car's going to go from 13 to 16 by putting wheel bearings in it?

[Caller]

No, no, no, no.

[Dave Ramsey]

I also don't know if you need wheel bearings or not. I want you to go get a regular mechanic, not a dealer.

[George Campbell]

It's an independent mechanic.

[Dave Ramsey]

Go to Christian Brothers and let them do an analysis for you. Dealerships are not crooked. They're just super expensive. It's the most expensive place to get a car fixed.

[George Campbell]

They can pretty much charge what they

[Dave Ramsey]

want over there, like sometimes double. So if they told you 3,000, Christian Brothers might tell you 1,500. I don't know. I don't know what your repairs are. And I'm not turning wrenches these days, so I'm not positive. But you check on it and look at. Okay. And the other thing you ask is, what is a reasonable repair to a car of this age and this Miles? Because sometimes I run into somebody, Claudia, for instance, that has a $3,000 car, that's 250,000 miles. And they're saying you need to redo the whole suspension. No, you don't. It's a $3,000 car. Nobody redoes the suspension on a $3,000 car. You drive them to the junkyard and you toss somebody the keys and you walk away. You know, you don't put $3,000 in a $3,000 car. And you don't redo the suspension on a 250,000 mile car unless you're rebuilding a classic car from the frame up. So just, you know. So some of these repairs that they suggest, yeah, you could do this, but no reasonable human would do that to a $13,000 car. And so a good. A good mechanic will look at you and go, it's not common sense. Okay, don't do it. And if it was my wife's car, I wouldn't do it. That's the kind of mechanic I want, right.

[George Campbell]

You might take your three grand you would have spent plus what the car is worth and go get you a different car altogether at that point might

[Dave Ramsey]

be a better plan.

[George Campbell]

Hey, George Camel here.

[George Campbell (advertisement voice)]

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[Dave Ramsey]

may vary and no specific outcome is guaranteed. Welcome back to the Ramsey show in the Fair Winds Credit Union studio. Dante is with us in San Francisco. Hey, Dante, what's up?

[Caller]

Hey, Dave, thanks so much for taking my call.

[Dave Ramsey]

Sure. How can we help?

[Caller]

Yeah, so I've been with my girlfriend for about three and a half years now, and I'm considering proposing. We're both fresh out of college, just lived together for about a year now, and we're doing pretty well financially for our age. The issue is that we're both Chinese. Well, I guess that's not the issue. But her family follows some traditional Chinese marriage traditions that my family does not. In her family, I'd be expected to give her parents about 30 to 40,000 doll as a dowry or bride price. And there's also significant pressure to have a large traditional Chinese wedding. And then my girlfriend and I are both not particularly interested in having and spending a lot on a wedding. But I think her parents and extended family strongly expect it. I like her a lot. I like her parents a lot. I think they're great. But my concern is just that even with our income right now, this would cause a pretty big Hit especially down the line for our savings.

[Dave Ramsey]

What is your. What is your income? Income.

[Caller]

So we are Both making around 175k each.

[Dave Ramsey]

Gross each. So if you were married, you'd be making a $350,000 household income.

[Caller]

Yes.

Okay.

[Dave Ramsey]

Okay. Now, so have you made the decision that you're going to honor both of these requests regardless, or are you trying to work through. Are you trying to work through? If you're going to set a boundary here.

[Caller]

Not. I'll be honest, it's probably looking like. Like, I would say, leaning towards yes for both. The bride price is something that is, I think, just very standard in her family. It's something that if I. I guess for either of these, if we were to not to either one, her parents would not either not approve of the marriage or be. I'd be on very bad terms with them to begin the marriage, and I don't want to be like that. So I'm. I'm leaning towards doing both.

[Dave Ramsey]

Okay.

[Caller]

All right.

[Dave Ramsey]

And so is 30,000. And then how much is the traditional wedding going to cost?

[Caller]

I would say.

I don't actually know. I'm not super well versed in how much a normal wedding is even. But I would say we're looking at roughly 75 to $100,000.

[Dave Ramsey]

I would guess. That sounds right. Okay, so we need. Let's call it 130 for the fun of it, and you make 350. And I mean, the first thing you've got to decide is that you're really going to do this and both of you are going to do it in spite of whatever. Okay. That. That's hard because you sound. How do I say this properly? I don't know what. The proper politically correct thing. You sound very Americanized, distanced from those traditions.

[Caller]

Yes, I personally, my family is very Americanized. Correct.

[Dave Ramsey]

That. That's.

[George Campbell]

I don't.

[Dave Ramsey]

I hope that wasn't offensive or something, but I just. You sound like this. Doesn't it? Like it. You know, it's not something you would do in a million years, but it kind of goes with the package.

[Caller]

Yep.

[George Campbell]

Now, is the expectation that you're going to personally fund all of this, or is she involved with her income? Is she willing to say.

[Caller]

I would say the dowry and the bride price is something that I would personally fund. Technically, her parents would actually give that amount back and more, but it would go into an account solely in her name that personally I don't have a huge problem with.

[Dave Ramsey]

Oh, wait a minute. So the wedding, you're not gonna have to pay for all of it?

[Caller]

No, the. Well, the bride price would be $30,000 from me to her, basically.

[Dave Ramsey]

I got it. And then her parents are gonna give you more money for this big traditional wedding.

[Caller]

It's more.

It's more likely not for the wedding specifically. It's more just for her to have, I guess, like a safety net. That's kind of how it works in Chinese traditionally.

[Dave Ramsey]

Can you spend that, all of that on the wedding?

[Caller]

No, that would come from, I guess, our joint account.

[Dave Ramsey]

Okay, so it is a net loss of 130 or so.

[George Campbell]

Okay, so let's say she covers 50, you cover 50 for the wedding, plus you're 30 or 40.

[Caller]

Yes.

[George Campbell]

So you need to save up about $90,000 out of your income, let's say, over the next 12 months. Yes, 18 months.

[Caller]

Yeah. And I guess my question was mostly just, is this something that I want to do? Is it something that I should kind of just say, like, screw it and let's do it now? Is it something that I should say I need to save up and hold on of this? How should I budget for it accordingly, I guess, is my main question.

[Dave Ramsey]

Yeah, well, I don't emotionally from the hillbilly culture connect to this tradition because most of ours are like shotgun weddings. Right.

[George Campbell]

It's on the other end of the spectrum.

[Dave Ramsey]

So, you know, I can't get my head around. But what I do want to respect is that you're going to be married to her for a long time and it's going to involve her parents. And so I tell you what I probably would want to do. And as respectfully as I could. Are they in China? Her parents?

[Caller]

No, her parents are in America.

[Dave Ramsey]

Okay, that's even better. I would want the two of you to sit down with her and her parents and say, we want to honor you. But you also need to understand that we were raised here and that if it wasn't for you, we wouldn't do any of this. The only reason we would do any of this is for you. Is there any amount of this that you would forgive and not force us to do?

[Caller]

Yeah, I think she's actually had a conversation with that, just individually, her, with her parents. And this was probably like a few months back, a year back maybe, and they were saying, like, oh, yeah, like if. Yeah, if he does ever want to propose, these are the things he's going to have to do. He's going to have to, like, come up. Come up to us, like, ask for our blessing, stated amount. And that was 30 before he's actually the requested amount and then also provide a bunch of like extra gifts and stuff. And I think that's their expectation.

[George Campbell]

I would get real clear on the numbers and not let this become some unlimited thing that you just keep funding. At least that'll give you clarity. So I know what the numbers are for everything. The wedding, the dower, and then figure out, okay, who's covering what, what's my portion, and then you set up a sinking fund. If you're going to go through this. I got to save four grand a month for the next 18 months to cover all of this. Are you in a spot financially to do that?

[Dave Ramsey]

Man, this is hard for me because I'm having trouble and you are too. That's why you called. I'm having a lot of trouble being required to write $130,000 check that I have absolutely no desire to write. I'm having trouble with that. But I'm not very compliant. I'm more defiant. And so, and so, you know, I don't know. I think if I'm. I would probably sit down with her father one to one and say, okay, I heard what you told my potential fiance, your daughter, but I want you to hear from me. I don't want to do any of it. And so I want to figure out what I can do that is honoring. Because the only reason I'm doing anything is to honor you. And I don't have to do any of it. She'll just go marry me. So we really need to talk about this. And so, you know, and just see if there's any budge here. I don't know. I mean, at the end of the day, would I sacrifice relationships with the in laws for the rest of my life for an X number of dollars when I make $350,000 a year? No, I probably wouldn't, but boy, do I hate black mail.

[George Campbell]

It does feel a little bit like that.

[Dave Ramsey]

You know, I like, I mean, it's just a ransom note. Yeah. And I'm. But again, it's my. That. That it's a cultural difference between being a hillbilly and being Chinese. And so I, I have to admit that intellectually, outside that this is my emotions talking, I would just be like,

[George Campbell]

hey, but I mean, what if he didn't make 175? What if he made 60? It's an unreasonable request.

[Caller]

Yeah.

[Dave Ramsey]

What's unreasonable request anyway? But it's traditional. And you know, it's the 15 year old birthday party if you're Hispanic. Right.

[George Campbell]

And we spend little quinceanera you get

[Dave Ramsey]

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[Caller]

Good, Dave.

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Yeah, so I just had a question. Thanks for having me on, by the way too. I feel like time's catching up on me with retirement and just really looking for clear path to get back on track. My question is really, should I just put off contributing to retirement? My wife and I both, we're both 42 years old and just concentrate on our debt or continue contributing to retirement and find a way to pay off our debt? We're currently living paycheck to paycheck. Right now, between the two of us, we make $235,000 a year. It's kind of embarrassing and really, I think got stuck in these buy now, pay later type deals.

[Dave Ramsey]

How much debt?

[Caller]

Credit cards in consumer debt with student loans and everything? 187,000, not counting our mortgage rate.

[Dave Ramsey]

How much, how much do you owe on your cars?

[Caller]

One car is 31,000 left on it, the loan, and the other is 17,000.

[Dave Ramsey]

Okay, so what's the other 130,000 credit

[Caller]

cards and some personal loans and 30,000 and student loan.

[Dave Ramsey]

So you just, you guys just, you borrow. You spend money like you're in Congress. How long you been making 235,000 and spending this kind of money?

[Caller]

I will say the last six months. My, my, I had gotten a new. Where I got the $50,000.

[Dave Ramsey]

How long have you been making 235,000?

[Caller]

Probably at least a year and a half.

Half.

[Dave Ramsey]

Okay. What were you making before that?

[Caller]

Right around probably like 1:80 between both of us.

[Dave Ramsey]

Okay. So it's fair to say there's absolutely no bridal on your spending until just recently.

[Caller]

Yeah, yeah. And when I just had an epiphany, actually I was watching your tick tocks that I that show up on TikToks, your video and I really.

[Dave Ramsey]

So I was, I was abusing you on TikTok.

[Caller]

Yeah, yeah.

[Dave Ramsey]

And you're like, oh, Dave's gonna get me.

[Caller]

Oh my gosh.

Exactly. I need to, I need to figure this out.

[Dave Ramsey]

I appreciate that. But the bottom line is the emotion is you looked in the mirror and said, I'm a 42 year old man, I make $235,000 a year and we can't control our spending. This is disgusting. And it had nothing to do with my TikTok. You just really just came to an epiphany to, didn't you?

[Caller]

Yeah. I mean, at the end of the day, you know, and then just thinking about them like that, I feel like I can't even enjoy like food to my labor, like getting where I am, you know, making decent money.

[Dave Ramsey]

Oh, you've already enjoyed the fruits of your labor and then some. Well, you've spent every fruit of your labor and then fruits of other people's labor. That's $187,000 worth.

[Caller]

Yeah, well, a lot of it's on our kids, I would say.

[Dave Ramsey]

Well, then your kids have. Yeah, they need to learn a new word. You want me to teach it to you?

[George Campbell]

I don't think the kids. Car loans.

[Dave Ramsey]

No, kids don't have car loans. But they go, you guys do anything you want to do whenever you want to do it without any thought of it, and that stops. You got, you're going to grow up, all of you. All of you. The kids and you know is the answer. We're freaking broke. We're broke.

[Caller]

Exactly.

[Dave Ramsey]

Yeah, we're broke. Broke people can't do that. We're not going out to eat. We're not going on vacation. We're cutting up all the credit cards. Tonight we're going to sell the $31,000 car and we're going to on beans and freaking rice. And all we do is work and pay off debt and we're gonna clean this mess up in about two years. But you're gonna go to scorched freaking earth. You're gonna go all the way to the other end of the spectrum with great intensity. If you do that, you're gonna retire with millions of dollars. If you don't do that. You're gonna continue to be normal. And as you and I have both established in this call, Mike, normal sucks.

[Caller]

Oh yeah.

[Dave Ramsey]

It's not fun. Your life is not fun.

[Caller]

Yeah, it's all. It's stressful and I'm always worried if I lost my job, what would happen.

[Dave Ramsey]

Yeah, you'd be. You'd be screwed. And you're going to retire broke. So stop all your retirement. If you don't do this stuff, it's going to catch because you guys, you're pretty extreme mess here. You're going to have to take some extreme measures to reset your all's brains on how money works works.

[George Campbell]

So think about this, Mike. If you paused investing, could you then take home 10, 12, 15 grand a month with your income making 235?

[Caller]

Yeah, I think I do about 600 into my retirement a month.

[George Campbell]

Okay, so we'll get that back on top of anything else that we can muster up. Sell the $31,000 car. That brings us to about 156 in consumer debt. Now you throw seven grand at that thing a month, you're done in less than two years. By 45, you have a fully funded emergency fund. You're completely debt free and you're investing in retirement 15%, which is way more than 600 bucks a month.

[Dave Ramsey]

And if you invest 15% of your income into retirement, which you can easily do with no payments.

[Caller]

Right.

[George Campbell]

45 to 65.

[Dave Ramsey]

So you're 20 millions and millions of dollars at retirement. But the next two years are going to suck. Yeah, it's going to be off.

[Caller]

I.

[Dave Ramsey]

Your kids are going to hate Dave Ramsey. They have to join the Dave Ramsey support group on Facebook.

[Caller]

Yeah.

Why?

I keep telling them they need to learn how to save now and not not. Yeah, because I mean.

[Dave Ramsey]

Yeah.

[Caller]

Yeah.

[Dave Ramsey]

Cuz you know what? You know what they're going to do when they grow up? What you do more is caught than taught. How old are they here?

[Caller]

9 and 11.

[Dave Ramsey]

Oh, that's pretty perfect. You got time to save them if they're teenagers. I don't know if you could turn it around or not, but you know, but right now they get to watch their parents sacrifice to win. And they're going to remember it the rest of their lives. And when they inherit $10 million at your death, they're going to say back in aught 26, Daddy and Mama said they wasn't going to do this anymore. And the whole life changed.

[Caller]

Right.

[Dave Ramsey]

Someday that's what they're going to be sitting on. But you're going to be the old man that changed the whole thing someday. But not if you're not the young man that changes the whole thing.

[Caller]

Yeah.

[Dave Ramsey]

You ready to do it? We'll help you. Okay. I think you can do it. I think you can do it.

[Caller]

Yeah.

[Dave Ramsey]

And I actually. The reason I kept you on here so long is I think you're disgusted enough to actually do it. It requires a certain level of being pissed off to do it.

[Caller]

Oh, yeah. I'm super mad. I can sense it every day.

[Dave Ramsey]

And it's not mad at somebody. It's mad at this situation and mad at the mess I made. And I'm not going to do this anymore. I've had it when you have that moment. And I can tell from talking to you that's why I keep you on the line. You've had that moment. If you were just blowing me off on all this stuff, I would have already blown you off. But, dude, I'm proud of you. I think you can do this. And I'm telling you, if you do. What? So stop the 401k. Sell the $31,000 car. Get on the every dollar budget. We're going to give you the upgraded version for free. Get signed up on. I'm going to send you a copy of the total money makeover book. You and your wife read through it and go, we want a life making 235,000 with no payments but a house payment. And we're going to retire 20 years from today with tens of millions of dollars. And I think you will. The numbers say you will.

[Caller]

On the retirement, though, should I go all the way down to zero?

[Dave Ramsey]

You've got to focus on the enemy right now, and the enemy is your overspending that has created debt. And you got to focus on that with such intensity that people think you've joined a cult like your broke friends are making fun of you. Look at Mikey. He makes 200 grand and he can't go out to eat. You know, well, kiss my butt. I'm not going to be broke anymore. I'm changing. You do whatever you want to do, broke person, and you just move on. You may need some different friends. So this is the thing. You've got to reset your brain on how this stuff works to where you get above this problem and step on it instead of it stepping on you. Because this money subject's been kicking your butt your whole life. You've never been able to tell it what to do. It's always told you what to do. That changes this week. Mike it has to, because if you

[George Campbell]

just make more, you're just going to spend more until you say I've had enough.

[Dave Ramsey]

We just found that out when he got the raise through 35.

[George Campbell]

Yeah. A third of people making six figures are paycheck to paycheck. And a lot of people think, well, if I just made more, I'd get out of this.

[Dave Ramsey]

I tried to out earn my stupidity. I couldn't do it because I had a lot of stupidity.

[George Campbell]

The more you make, the bigger the zeros on the end with the stupidity.

[Dave Ramsey]

That's exactly right.

[George Campbell]

Bigger mess you get to clean up.

[Dave Ramsey]

So hang on, Mike. We're going to send you a total money makeover book. 10 million people have used that to get out of debt and become wealthy. I want you and your family to become wealthy and be able to do anything you want to do. But it's going to cost you two years to clean up your last 10 years of stupid rapidity. 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 Finance. They're 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 at the end of the month. No matter your situation. Health Trust Financial shops multiple times 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 Ramsay 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. Here's what some people don't realize about wills. They're not about age. Turns out out people of all ages die. There's an insight for you. Real hopeful and we've done research all of you and George and I are going to die. Our research shows that. So if you are an adult and you love kids, pets or any amount of money you have made to go to the right person you need a will. It's like a grown up thing to do. And this is national Make a will Month. Like anybody cares, but it really is is and so get a will. Seriously, if you're ready to get one, go to mama bear legal forms.com and if you're not sure where to start? You can text quiz to 33789. We'll help you figure out which option fits your situation. All right, Brian is with us in Dallas. What's up, Brian?

[Caller]

Hey, Dave. How are you?

[Dave Ramsey]

Better than I deserve. How can I help?

[Caller]

Hi. So I'm wondering, since the rates are

really high right now, my timeline is

about 16 months or so to look into buying the house. Should I look into getting an assumption loan?

[Dave Ramsey]

There's no such thing.

[Caller]

There's not?

[Dave Ramsey]

No. The only loans that can be assumed have to be reset and you have to qualify for them and they'll raise the rate.

[Caller]

Oh, right.

But you, you wouldn't go into their rate.

[Dave Ramsey]

No, you can't. Oh, where'd you hear this?

[Caller]

Yeah, but I heard it on TikTok.

[George Campbell]

Yeah, it gets a lot of clicks and views on TikTok, but they're so rare because of how many stipulations have to take place that they pretty much never happen.

[Dave Ramsey]

Yeah, so in the, in the 1970s, loans that were FHA loans, HUD loans, were fully consumable without qualification and the interest rate did not move. They did away with that in the early 80s and that's the last time there have been fully assumable loans. All other loans have, for instance in a Fannie Mae, a conventional deed of Trust, paragraph 17, if you actually want to look it up in paragraph 17, it's called a due on sale clause, meaning that the entire mortgage is due upon the sale of the property and they will call the entire loan. Okay, now if that entity, let's say that's with a bank and they're using that, and they have that paragraph 17 in their deed of trust, if they want to allow you to assume it, they're going to qualify you and they're going to reset the rate to current rates. Otherwise they would rather just get paid off. Because they'd rather get that 2% loan off the book and reloan the money at 6% current rates. So they don't want that loan out there at the current rates. Now let's fast forward one more time. Brian, since you called and we're in the teaching business here, the TikTok idiots, what they are suggesting is going to get you fried. Because there is a thing in the get rich quick real estate world where you just go in and you don't register the deed and you keep the property in the other guy's name and you agree to pay him by contract or contract for deed or whatever phrase they want to use for it. But once the mortgage company discovers that in effect the title has been transferred even though it wasn't recorded, they're going to call the loan and foreclose on the property. So if you follow these TikTok morons and assume a loan without the bank's knowledge, hiding it from them, that's a fraudulent transaction. You're gonna get foreclosed on and lose all your money. And you should, cause you're a freakin liar. You lied, okay? And that's what these guys are teaching you to do. It's a, it's a fraudulent technique. It's a lying a technique by which you lie. And it's called contract for deed. You can do it that way and it's a wraparound mortgage. These are all phrases we used in the 70s and 80s when we could actually utilize those old FHA loans legally and without being fraudulent and we could wrap around them, we could do all kinds of stuff. But you cannot do that with modern mortgage documentation. They have the ability to call the loan and they will as soon as they discover you're screwing with them. And they should.

[George Campbell]

And you need to cover the cash gap. So whatever the home is worth and whatever the loan is, you got to cover the difference in cash.

[Dave Ramsey]

Well most people that are doing this don't have it. Flip this house. TikTok Tucker wants to say okay, you owe 140, we're going to sell you the house for 200. We owe 140 on it. And the last lady we bought it from, we never paid off her mortgage. It's still sitting there because we wrapped it and now we're going to let you wrap it up to 200 and they're going to let you pay the whole loan to them and they're supposed to pay the underlying and never transfer the title. Title's not in your name, it's a mess. And so you're what's known as screwed the first time something happens, I mean the house burns down, the taxes are not in your name, you don't get notified, the taxes don't get paid, there's no insurance on the stupid house because you can't put the insurance in your name because the mortgage company knows whose name the insurance company's in because they got a copy of it because their name's on it too as a payable, as a payee in the event of a fire. And so good lord, it's just, it, it's just so crooked.

[George Campbell]

So if the interest rate's the deciding factor just means you need to wait until you can afford that thing with current rates.

[Dave Ramsey]

Yeah. And by the way, 6% is what we're sitting at today. 5.9 on a 15 year fixed. By definition that is not high. By definition that is low. And compared to historical data, it's dramatically low. Six percent should cause a real estate boom. Interest rates are not what's holding people back. Okay. It's the fact you got all these other loans, you got no control of your money money. And you don't have the money to put, you know, haven't saved up the money and you're trying to buy a house you can't afford in a city you can't afford to live in. This is. These are the problems you get into. So yeah, please, Brian, don't listen to people doing real estate deals on TikTok. Good lord. That's the worst possible. That's as bad as Reddit. These are the two sources of sewage. It's just, it's just raw sewage. You will die from salt cross sewage kill you. Jacob is in Oklahoma. Hi Jacob, what's up?

[Caller]

Hello, sir. I am currently in the Air Force and they are sending me from Oklahoma to Alaska. I currently only have a motorcycle and I'm trying to determine if it is a good idea to finance a more reliable car or purchase a cheaper, possibly issue ridden car car to save my cash reserves.

[George Campbell]

So your only options are go deeply into debt or buy a car that's going to explode on the interstate. That's what you just.

[Caller]

Exactly.

[George Campbell]

Okay, just want to make sure we were clear here.

[Dave Ramsey]

What's the motorcycle worth?

[Caller]

It's probably worth around six grand.

Okay.

[Dave Ramsey]

Why don't you buy a six grand car?

[Caller]

I just, I don't know if six grand is going to.

[Dave Ramsey]

I do.

[Caller]

A reliable enough vehicle.

[Dave Ramsey]

Absolutely. Oil. It won't be pretty and it won't attract chicks.

[George Campbell]

You got a girlfriend?

[Caller]

But not right now.

[Dave Ramsey]

He's going to Alaska.

[George Campbell]

We'll find one over there. But here's the truth. There are $6,000 cars that will run just fine. Get a pre purchase inspection, It'll cost you 100, 150 bucks. You'll know if there's issues ahead of time.

[Dave Ramsey]

And you're probably better off just buying Alaska. It's a little more expensive. But shipping one to Alaska is not cheap either. So how long are you going to be stationed there, Jacob?

[Caller]

The Air Force will cover the shipping of one vehicle, Oklahoma to Alaska. And I'll be in Alaska for four years.

[Dave Ramsey]

Okay.

[Caller]

Yeah.

[Dave Ramsey]

Then get you a great $6,000 car and cover the shipping you don't have any other money? I take it, other than the motorcycle?

[Caller]

I have about 15k in cash.

[Dave Ramsey]

Oh, great. So how expensive do you want a car? Do you want, you don't want 21. What do you make?

[Caller]

Yeah, I make about $2500 a month, but so $30,000 a year or anything like that.

[Dave Ramsey]

So if so you. 21,000 if you sell the motorcycle. How much do you want to spend on a car?

[Caller]

I was probably looking to spend around 10 to 12K.

[Dave Ramsey]

Well, just write a check.

[Caller]

You think that's a good idea as opposed to trying to save some of

[Dave Ramsey]

that money a thousand percent. Do not buy a car with a car payment ever the rest of your whole life.

[George Campbell]

Taking on a car payment is a terrible way to save money.

[Dave Ramsey]

It's a guaranteed way to stay in the middle class the rest of your your life. It's the most expensive thing we buy that goes down in value. Ne. I'd ride that motorcycle in the cold, baby, in Alaska before I'd go into debt. But you don't need to sell the motorcycle. You got 21,000. You pay $12,000 for a car, ship it up there and you got a little money in the bank and you're, you know, not a lot to do up there anyway. So just stack your.

[Caller]

Hey guys, it's Rachel Cruz. When it comes to life insurance, most people fall into one of two camps. The ones who make a plan to protect their families family and the ones who hope everything will just work out. But hope isn't a financial plan. When you get married or have kids, your money decisions aren't just about you anymore. Your income helps keep the lights on, pay the mortgage and put food on the table. And if something happens to you, will your family have protection or uncertainty? Well, at Ramsey, we recommend term life insurance that 10 to 12 times your income with a 15 to 20 year term for the years that your kids are at home and your mortgage is still being paid off. That's why Winston and I have our term life coverage through Zander Insurance. They're an independent broker who works for you, shopping all the top companies to find the most competitive prices on coverage you need. Get instant quotes online in just [e-mail] or call 800-356-4282 to get your family protected with term Life Insurance. That's Zander.com or 800-356-4282.

[Dave Ramsey]

So when our grandkids turn 10, Sharon and I take them on a trip somewhere and Rachel's oldest daughter Amelia and Denise's oldest daughter, Lydia, were ready for their 10 year old trip. So we took them to Washington D.C. and we tour around to all the monuments and all this monuments and all this stuff. And traveling with Papa Dave is cool because Papa Dave don't do anything except luxury travel anymore. That's right. So you got it made. So like we get a VIP tour guide. So we let go in the back door, not because of Dave Ramsey, just because I wrote a check for the guide. Right.

[George Campbell]

You're paying for the premium expenses.

[Dave Ramsey]

Go in the back door and you get in five minutes before everybody else into the National Archives to see the Declaration of independence. And 35 minutes later, there's 2,000 people standing there. But yeah, you don't want to be in there in the middle of that. But it's wonderful to see this. So we went all around Washington D.C. walking around with the grandkids and the tour guide and Mount Vernon and the Capitol and got to tour the White House. Melania's staff, first lady staff was very nice to allow us to do that, set it all up. It was very cool. But the fun thing was, everywhere we went, we would run into somebody who recognized me. Rachel was with us too, recognized me or Rachel, and said, hey, thanks for what you do and you changed our life and can we get a picture or whatever and all this stuff. And we're walking along a sidewalk and this guy is sitting on the sidewalk with a cooler beside him yelling, you know, cold water Gatorade. Cold water Gatorade. Just a street vendor. And I walked behind. He goes, shut up, Dave Ramsey. And I said, absolutely, dude. Who are you? And I stood there and talked to him for a minute. He goes, hey, man, this is my side hustle. I'm making really good money selling bottled water to the tourists for getting out of debt. This is my side hustle. How cool was that?

[George Campbell]

That was incredible.

[Dave Ramsey]

That was fun. And we got this one in too. So we run into a lot of different people. And I got to hear a lot of wonderful stories. Hey, crew. I saw Dave Ramsey and his daughter and grandkids at the Capitol building about two weeks ago. I was walking through the Capitol with my five boys. I saw them. I wanted to shake his hand and thank him for saving me from a life of debt and endless years in the workforce. I've raised my five boys, my husband's single, military income, all because I was introduced to Dave Ramsey and the Ramsey team around the age of 16. I followed the program ever since. At 36, I'm pursuing a Flight, career, debt free. My husband's retiring from the military in about five years to start his own business. We're so grateful. This particular trip sent me over my budget. And I was just mulling that over in my head when the budgeting master appeared in front of me. How great is that? Yoda, right? The guilt of my overstretched budget and what I would equate to financial idol of mine appearing before my eyes wrecked my whole day. And she didn't even say hi. She walked away. Oh, that's fun. You could convey my endless appreciation to him. Well, you're. Well, we appreciate your endless appreciation.

[George Campbell]

It was nice you said.

[George Campbell (advertisement voice)]

I didn't want to disturb him or

[George Campbell]

his family on their vacation.

[Dave Ramsey]

You're not ever disturbing us. We're always honored to meet anybody anywhere.

[George Campbell]

I disturb Dave more than anyone that. Well, I don't care, vacation or not.

[Dave Ramsey]

Maybe Rachel.

[Caller]

But.

[Dave Ramsey]

Yeah. So, no, I mean, we. We. It's oftentimes somebody will say something nice to us.

[George Campbell]

And Rachel told me one of the security guys at the White House, you know, full camo, huge gun, he leaned

[George Campbell (advertisement voice)]

over and said, I make all the

[George Campbell]

cocktails for Smart Money Happy Hour. I don't miss an episode like, wow,

[Dave Ramsey]

a bunch of these guys were checking into the Senate Building, and one of those guys leaned over and said, yeah, smart Money happy. Different guy, too. Yeah, the Smart Money hobby are right popular. George, there's a few people out there in Washington, D.C. watching your drama.

[George Campbell]

They need to decompress after all the drama over there. So that's what we're here for.

[Dave Ramsey]

That's exactly right. Well, thanks to all of you. We appreciate all of you that listen and all of you that say nice things. We really do. Thank you very much. Jordan is in Cincinnati, Ohio. Hi, Jordan. How are you?

[Caller]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Thank you so much for taking my call. And I want to say on behalf of my family, thank you. My parents took SPU when I was a kid and they changed our family tree, which has set my sister and I up for success.

[Dave Ramsey]

Wow.

[Caller]

My question.

[Dave Ramsey]

Very cool.

[Caller]

At 30 years old, my husband and I are sitting at 140,000 in retirement. Using your retirement calculator. At that 10% rate of return and a retirement age of 65, it gives me 4.6 million without me contributing anymore. Is there ever a point in time that you can consider Baby Step four done or complete?

[Dave Ramsey]

No. I know. I always invest. I didn't stop investing when I had a first million dollars. I kept Investing, because the money then gives me options for a couple of things that are very important spiritually and emotionally to me. It does three things. One is it gives me additional security, which is not a big deal. Once you get past five or $10 million, you're not worried about that. And the second thing it gives me is the ability to completely, as you said about your parents, change my family tree. And, you know, $10 million does a lot more than 1 million. And the third thing it does is it increases my ability for generosity. And so, I mean, if you had $10 million, you're making a million dollars a year in growth. You can give away a million dollars a year and still have $10 million for the rest of your life. That's kind of fun, by the way. Highly suggest it. So, no, I don't stop building wealth. I always enjoy some. I always, always have a generosity factor that's substantial and more substantial. The percentages don't change a lot, but the numbers change. And I always have investing my whole life I have, and I teach everybody that. And I've always done it. I wouldn't tell you to stop enjoying it except for a short period of time while you're in baby step two. Right. And no, I get what you're saying, but I don't know what you're gonna do do with all the money you're wasting in the meantime. So you can do all of that and still have a great life. You can keep investing 15% of your income the rest of your life and still have a wonderful life.

[George Campbell]

Yeah, well, money is a tool. And so you have more money. We have more options for what you can do.

[Dave Ramsey]

It equals options. That's what it is.

[George Campbell]

And so I like having options. And we don't know to factor in 35 years. We just don't know what your future holds and what life events are going to happen. I'd rather be investing for the future and have more than I need then, not enough.

[Dave Ramsey]

And, you know, if you don't need it and you don't want to give it to your family, give it away, help somebody with it. You've got the gift of getting an early start, the gift of getting an early education, and you've done very well so far, but you do only have $140,000. It's not much really, in the scope of life. So let's go get some more. And that's not greedy. It's just saying this gives me options and it gives me security, it gives me the ability to be generous and it gives me the ability to change my family tree and make sure that this is the last ugly Ramsey in this branch to be debt in debt and bankrupt. You know, it can stop here. If I teach them and I leave them zeros, lots of zeros. You gotta teach them, you gotta leave them lots of zeros. And you know, I can be the last one. I mean, somebody's got to be old man Vanderbilt. Right? Somebody's got to be old lady Rockefeller. Somebody's got to break the chain in this family and change it. Break the curse of poverty, the curse of being in debt, the curse of mediocre mindset and stupid socialism ideas. Somebody's got to break those curses off of my family. And it might as well be be me and it might as well be you. And so that's the way I look at it. I don't want to get stuck with any of that anymore.

[George Campbell]

And the math is incredible. When you look at the ROI of a dollar when you're 30, I mean, if she puts in a thousand bucks a month, let's say for the next 35 years, instead of that four point something million, she'll have 8.3 million. And that's only. She's put in an extra 400 grand to get an extra 4 million out. That's a pretty sweet vending machine right there. So as far as you know, your

[Dave Ramsey]

money goes, that's better than Chuck E. Cheese.

[George Campbell]

Pretty good bang for your buck right there. And again, it changes the life you can have and the options you have and your family tree.

[Caller]

Yeah.

[Dave Ramsey]

So the answer is no, I wouldn't. I would have a steady stream of generosity, a steady stream of enjoyment, and a steady stream of investing the rest of your life. And that's how what I've done also, and asking do something I didn't do, and it's made me a really good life. If I wasn't me, I'd want to be me. All right. Sophia is in Salt Lake. Hey, Sophia. Sophia, what's up? Oh, no, you're not. No, you're not. We're at the end of the hour. We're going to come back to you. Sophia, there's another hour and you're going to be just fine. Don't worry about it. And you, for people that don't know how to get that other hour, well, you're going to teach you about YouTube and podcasting, I guess. We'll get you there, I promise. Sam. Welcome back to the Ramsey show in the Fair Winds Credit Union Studio. Susan is with us in Orlando. Hi, Susan. How are you?

[Caller]

Good, thank you. My husband and I would love to know if we are being too generous too soon. We opened up a non profit cat Cafe over two years ago for our son who's 24 years old, who has down symptoms syndrome. And we adopt out cats. We partner with Easter seals so that other people with disabilities have work experiences. And we also use it as a ministry by playing Christian music, giving away bibles and Christian literature. But.

[Dave Ramsey]

Okay, help me with this, because I need to understand what a cat cafe

[Caller]

does is adoption center.

[Dave Ramsey]

An adoption center.

[Caller]

It is. It's like a living room environment for the cats to roam around while people come in and visit and socialize with them and then have the ability to adopt them out.

[Dave Ramsey]

Okay, so your question is, how are you being too generous? So you set up and operate this whole thing.

[Caller]

Yes.

[Dave Ramsey]

Out of your pocket.

[Caller]

Yes.

[Dave Ramsey]

As a gift.

[Caller]

Yes.

Okay.

All right.

[Dave Ramsey]

And of course, you did not expect it to be a business. You expected for this to lose money.

[Caller]

Correct.

We were hoping to break even.

[Dave Ramsey]

How would you do that? Do people pay fees to adopt the cats?

[Caller]

They do. Correct.

[Dave Ramsey]

Okay. And. But they're not doing that often enough.

[Caller]

Or are you not charging, having just recently the cost? But we're not getting enough customers or community involvement. So it might be just because we've only been around for a couple years and the word isn't out yet.

[George Campbell]

How much are you losing every month doing this?

[Caller]

We're losing 4,000amonth.

[Dave Ramsey]

And, and, and what is your net worth?

[Caller]

1.7 million.

[Dave Ramsey]

Okay, so 50,000. How old are you?

[Caller]

I'm 48 and my husband is 60.

Okay.

I earn 187 a year.

[Dave Ramsey]

In addition to what your investments do. Okay, Correct.

[Caller]

And I'm still. We are investing 18.5 per month or total.

[Dave Ramsey]

But, I mean, you can handle with the numbers. You're giving me a $50,000 a year donation to the world of cats or whatever we want to call it.

[Caller]

Right.

[Dave Ramsey]

This is a. Have you formed it as a nonprofit?

[Caller]

It is. It's a 513C. So we do get tax benefits.

[Dave Ramsey]

Okay, but you do not solicit outside donations, only fee for the cash.

[Caller]

We have a little bit, but self reportedly, we have not done well with asking for money.

[Dave Ramsey]

Yeah, that's not shocking. Okay, and how many cats did you adopt out, say, in the last 12 months, as an example?

[Caller]

Well, it's 232 in the last two years, so about 115.

[Dave Ramsey]

Okay.

[Caller]

All right.

[Dave Ramsey]

So 10amonth. Okay. And they chart and you charge What?

[Caller]

Well, about 150 per cap, but we give most of that back to the rescue so they can continue their efforts. They microchip the vaccinate. They spayed and neutered the cats before

[Dave Ramsey]

they send them to you?

[Caller]

Correct.

[Dave Ramsey]

So these are all rescued animals.

[Caller]

They are.

[George Campbell]

So how much are you actually bring?

[Dave Ramsey]

Is that. That's included, though. Oh. But so it's just your operation, so. Yeah. So you break even. You're not collecting any fees towards your operations, so your operation is just all out of pocket.

[Caller]

Yeah.

[Dave Ramsey]

Four grand a month.

[Caller]

What do you.

[George Campbell]

Are you leasing a building for this? Is that what's going on?

[Caller]

We do. We do lease a space and then we also employ a couple part time employees. And then, you know, cat food and litter. Also it's a gift shop, so a little bit of merchandise as well.

Okay.

I did look back in the last six years. Our net worth did still increase by 700,000. So it's definitely.

[Dave Ramsey]

I don't think it's killing you. I think it's just emotionally bothering you.

[Caller]

Yeah, I'm anxious about losing money.

[Dave Ramsey]

Yeah. It's just like the business. The business model of the nonprofit is not what you thought it was going to be, right? Yeah.

[Caller]

I think we definitely need to be better about asking for help. We're both nurses, so we're usually the helpers and not the people asking.

[Dave Ramsey]

Yeah.

[George Campbell]

Can you get volunteers?

[Caller]

We can.

[Dave Ramsey]

Okay. So here's what I would do in this situation. I would treat it emotionally like it's a small business that's losing money. And in that case, what I want to do is I want to say what must be true for me to be happy that we're doing this. And that's a number. Okay. I'm not happy. You've established that at 48,000 a year.

[Caller]

Right.

[Dave Ramsey]

Not because it's hurting your net worth or not because you can't afford it, but because that number bothers you. It's that simple.

[Caller]

Right.

[Dave Ramsey]

Okay. The juice isn't worth the square squeeze.

[Caller]

Right.

[Dave Ramsey]

The benefit of helping is not worth 50k to you. It doesn't seem to balance the scales. So how much would you be willing? You don't have to answer me, but you got to answer you. How much am I willing to feed this thing? No pun intended. Right. To. And still be okay with that. Okay. It might be that you could do something else that was, you know, $5,000 a year that gave you the same sense that you were after with this. And I don't know what it is, but it might be that we. Okay. This methodology that we were using here to be a blessing to the animals and our special needs child is not paying off. So we've got to find another way to be blessing to the animals and blessing to the special needs child. And it could be that you just take the existing shelter and you make a donation and your child volunteers there and you set up a room at that shelter in your name that you give them a one time gift that keeps it going or gets it going and then they keep it going or whatever. I mean, it could be you just find out a different method to. Try to do some of the same original motivations or we change this model.

[Caller]

Model.

[Dave Ramsey]

I'm afraid just on the outside looking in, if you charge more, you're probably going to have no adoptions because there's only a certain amount people are going to pay.

[George Campbell]

They'll go elsewhere to adopt a cat. Right. If it's half the price. So that's not a lever we can tweak much significantly.

[Dave Ramsey]

Yeah. And if you don't make the donation back to the animal center, they'll continue to send you animals anyway because you're a methodology to help the animals find a home. Right?

[Caller]

Correct.

[Dave Ramsey]

Yeah. So you don't have to make that donation back. And so at 100 bucks, you know that that's thousand dollars a month. 1500 bucks a month. Right, Right. So I don't know. But you got to decide what must be true here for me to be okay, because I'm not okay today.

[George Campbell]

And maybe you look at, you know, local businesses that will sponsor you for a couple hundred bucks a month, you'll advertise for them in the shop and

[Dave Ramsey]

I'm going to get good at asking for money.

[George Campbell]

Yeah.

[Dave Ramsey]

If you're in the fundraising business, I'm going to, you know, or I don't want to do that and so I'm not going to do it anymore. And we're, you know, you could close it. That's an option, you know, just. But I'm going to sit around and creatively think, okay, if I wasn't doing this at all, what would I do today? That would be the number that I'm okay with. $2,000 a month, I'm okay with that, whatever. What would I do today to do that? And would I make a $50,000 year donation to, you know, Cats R Us or something? I don't know. And this is the part where we say there's more way, more than one way to skin a cat. No, you don't say that.

[George Campbell]

I was waiting for it.

[Dave Ramsey]

You can't say it here. I say it on this call.

[Caller]

Okay. Foreign.

[George Campbell]

Hey, guys, George Camel here.

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[Dave Ramsey]

34 years on the air. First cat cafe call and not the last.

[George Campbell]

May there be many more. They're getting popular. That's all I'm saying. Well, I mean, there's dog bars too, by the way. I know you're a dog guy and

[Dave Ramsey]

you're all about horses.

[George Campbell]

I love a horse cafe, but I think the smell would turn people away from drinking their coffee.

[Dave Ramsey]

I'm not even gonna. Yeah. Hey. If your private student loans are in default, when you've fallen so far behind that the loan is underpaid, considered unpaid, why Ren Refi may be able to help. Why Refi helps borrowers in tough situations. Explore low fixed rate refinancing options that fit your budget. Go to yrefi.com Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[George Campbell]

Today's question comes from Tim in New Hampshire. I'm planning to retire at the end of the year, and I'm wondering if I should take an $80,000 lump sum from my employer or take a monthly payout from my retirement benefit. I'm debt free and on baby step seven. What would you advise? It's a fun math equation. Now, I don't know the monthly payout that would have been nice to know as a part of this. But generally, if you can take the lump sum and you don't necessarily need it and you can invest it, it might be better off. Depending on what that payout is.

[Dave Ramsey]

It almost always is. Okay, so there's two things going on with a pension, and that's what we're talking about. Most likely, the pension regulations require that the money is invested in such a way that your typical return on a pension is around 6 or 7% versus a good growth stock mutual fund, which would have averaged between 11 and 12%. Okay, so. So number one, you're. When you're getting that monthly payment, it's based on a lower rate of return. Not good. Number two, when you die, if you take $80,000 and put it in a mutual fund, someone gets the $80,000 or whatever it is grown to. If you die with a pension, nothing, zippo, nada. You could have survivor benefits. And then when your spouse dies, nothing, zippo, nada. Okay, so now we always take the lump sum because it's a lot more when you die and a little more while you're life. And typically, here's the thing. In other words, if you take the 80,000 and invest it, it typically will create more monthly income than the pension because it's invested better. That's what it amounts to. So, yeah, we almost always, when we run the calculation, we tell you to take the lump sum. It's a lot better when you die and a little bit better while you live.

[George Campbell]

And it's in your control. That's the most important.

[Dave Ramsey]

There you go. There's that too. Sophia is in Salt Lake City. Hi, Sophia. How are you?

[Caller]

Yeah, hi. How are you?

[Dave Ramsey]

Great. How can we help?

[Caller]

Yeah, I just had a question. So my husband and I own a house. We have one car payment and a little girl. My husband doesn't like our house. He wants to move into an apartment so that we can save money for a better house. Is it better to move into an apartment or stay into our house and build equity?

Okay.

[Dave Ramsey]

Why does he not like your house?

[Caller]

I think he just doesn't like it because he. We feel like we're spending more money, like watering the lawn or like if it's just kind of smaller. It only has two bedrooms. We can't really grow our family into it. And there's some things that need to be done with it. And I think that's just spending more money.

[George Campbell]

So he just doesn't like the idea of home ownership at the this point?

[Caller]

I think so.

I don't know.

No, I think he really does love. He wants to get a house, and I think this one just doesn't feel like the right one for him.

[George Campbell]

Okay, but you have one child and two bedrooms, so right now it works for your family. He just doesn't like watering the lawn. Yeah, that's what I'm hearing.

[Caller]

Money spent. Yes.

[George Campbell]

So how much is this mortgage compared to your income? Because you said it's also a financial burden.

[Caller]

Yeah, so our mortgage right now is 2,900. Our income is 6,200.

[George Campbell]

So that's eating Your lunch right there. It's about almost half your take home pay.

[Caller]

Yeah, yeah.

[George Campbell]

So you just bought too much house to begin with and so now he's seeing all of this.

[Dave Ramsey]

You spent too much. I don't know if you bought too much house. That's a very expensive two bedroom house.

[Caller]

Yeah. It has a basement. They call it the basement downstairs a room, but it really isn't, doesn't have a closet.

[Dave Ramsey]

So what will this house serve? I'm sorry.

[George Campbell]

Phoning a friend I think, I think she's asking him right now.

[Caller]

Yeah, I don't know exactly. I know that we.

[Dave Ramsey]

Yeah. So what I would do is find out, figure out what it would sell for. It just seems like it's very expensive. $3,000 a month for a two bedroom in salt Lake City. It sounds out of whack. Like you bought in a neighborhood that's like pretty chic or something. I don't know, I don't know what you're doing or what the problem is.

[George Campbell]

If you go buy a three bedroom, it's probably going to be more expensive. So it doesn't matter.

[Dave Ramsey]

Well, if you stay in the same neighborhood, but maybe you need to be in a different area. So no, I would not long term be a renter. No, I would not buy a home that is 40% of your take home pay. Unless your income is going up dramatically over the next two years, you're going to be paying pinched. Because you're what we call house poor. Because by the time you pay all your bills and pay your house payment, you don't get any money, you're broke, and so you bought a house you can't afford in terms of the payment. And so yes, if your income's not going to go up and you don't like the house, then it is time to get out of this house. And if you rent for a short period of time, one year or something, while you reassess and reevaluate where you're going to live and get a payment that you can actually afford on a 15 year fixed rate, then I would change and go that way. Yeah. And so you know, those are all decisions you guys can make. But the answer is yes, we would sell this house. Unless your income is going up because your payment is too much as a percentage of your income for you to have a quality life. The payment's going to eat you and

[George Campbell]

get rid of that car debt as well. So if you reset, go rent, pay off the car loan, save up an emergency fund, stack up a bigger down payment, you'll be good shape.

[Dave Ramsey]

Dalton is in Memphis. Hey, Dalton. What's up?

[Caller]

Hey, Dave.

George. It's good to talk to you.

[Dave Ramsey]

You too. How can we help?

[Caller]

Thank you for taking my call.

[Dave Ramsey]

Sure.

[Caller]

Yes, sir. So the question is, I can give you the question, give you a little backstory. So we had, last June, our house flooded. Thankfully, we did have flood insurance, so we were able to. We rented for a little while, and through some other problems that we had, we chose not to move back. And so the renovations took about a little, about a year, and we bought another house. That house is now on the market and it is completely paid for. So we have only one mortgage. And my question is it's been on there for about coming up close to 70 days. Do we just wait it out,

keep

lowering the price, or at some point think about maybe renting it out?

[Dave Ramsey]

Are there other houses on the street that are. Have sold or for sale that are in the flood zone?

[Caller]

1. One directly did, but I guess she's technically not in it, but she did have some water damage because it was more of an astronomical flood than it. Than the plane says it is.

[George Campbell]

And you've had no showings, no offers in 70 days.

[Caller]

Lots of. Lots of showings. A couple very interested parties. The flood insurance is what's backing people

[Dave Ramsey]

out of the deal, whether you can buy flood insurance. Why wouldn't they not do the deal? They just don't want to be in a flood.

[Caller]

Price.

[Dave Ramsey]

They don't want that.

[Caller]

And the price of what it's going to cost to have the flood insurance?

[George Campbell]

Additional cost.

[Dave Ramsey]

How much is the flood insurance?

[Caller]

The one I just. The policy I just bought was about 2500 for the year.

[Dave Ramsey]

And what's the house price? That.

[Caller]

299.

[Dave Ramsey]

Okay, that's 1%. That's not killing this deal.

[George Campbell]

It's an extra 200 bucks a month.

[Dave Ramsey]

You could give it. You could give them 10 years of flood insurance to still make a deal. Right.

[Caller]

We just haven't had any offers. It seems like the area here is very staggering, stagnant. I've. My realtor is pushing this every day, and every property that they have at their firm is just sitting.

[Dave Ramsey]

Okay, so it's not flood. It's not a flood zone issue then.

[Caller]

Seems to be the slow market.

[George Campbell]

It's not helping.

[Caller]

That just seems to be not helping.

[Dave Ramsey]

Yeah, it's not helping, but I don't think it's killing your deal if you're sitting in a market where nothing's selling. Lowering the price doesn't matter. That Won't cause a sell until you get down to a giveaway price. I might look at changing realtors.

[Caller]

Are you?

[Dave Ramsey]

If you're not using a Ramsey trusted real estate agent, you may want to take a change in realtors. Sometimes that'll move the property.

[Caller]

Foreign.

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[Dave Ramsey]

Lee is with us in New York. Hey, Lee, what's up?

[Caller]

Hey.

How are you?

[Dave Ramsey]

Better than I deserve. How can we help?

[Caller]

I hear you. I'm trying to get where you're at. Oh, my God. I'm so happy to be here. Ah, real quick. I'm 54 years old. I've been on baby step two for 18 months. I paid off $38,000.

[Dave Ramsey]

You go, girl.

[George Campbell]

Awesome.

[Caller]

Thank you so much.

[Dave Ramsey]

So proud of you.

[Caller]

Thank you. I appreciate it. And that's why I'm here. I have gone against everybody that I know. I've been hearing about how I need

to take a break.

I'm too old to work two jobs. You need credit. You're crazy. I've been all surrounded by naysayers.

[Dave Ramsey]

A lot of losers around you.

[Caller]

Oh, my God, yes. I even was like, you know what? I made a payment today, and somebody had the nerve to say to me, look, you bragging. Good bragging.

[Dave Ramsey]

You need some new friends.

[Caller]

Exactly. I haven't had a pedicure since 2024. I've been living off of boiled eggs and Quaker instant oatmeal.

[Dave Ramsey]

You're amazing.

[Caller]

To buy myself a new bed, I've been sleeping on a futon mattress.

Are you.

[Dave Ramsey]

Are you done? Are you finished?

[Caller]

Yes. Today is the day that I make my final debt payment.

[Dave Ramsey]

On what? What are you paying off today?

[Caller]

Today is a credit card. I had three credit cards.

[Dave Ramsey]

Who is it? What credit card?

[Caller]

Citibank.

[Dave Ramsey]

Oh, I hate them. I'm so glad it's not in your Wallet.

[Caller]

No, it's not. I just. Today, I just wanted to do it just surrounded by people who actually understand what I've been going through.

[Dave Ramsey]

So you're gonna make your payment live on the air right now.

[Caller]

Right now.

[Dave Ramsey]

The final payment.

[Caller]

Yeah.

[George Campbell]

Mark the moment.

[Dave Ramsey]

I love this.

[Caller]

Yes.

[Dave Ramsey]

This is so fun. I'm so proud of you.

[Caller]

Thank you, Dave. I've been watching y' all for years. What do you.

[Dave Ramsey]

What do you make a year?

[Caller]

I started at 81,000, and I went up to 93. I work in a restaurant. I had two restaurant jobs.

[Dave Ramsey]

So if you. If you look back, you're 54. When was the last time you were 100% debt free?

[Caller]

Oh, God.

Oh,

I was 30 something.

Wow.

[Dave Ramsey]

So 20, 25 years.

[Caller]

Yeah. Yeah. Went through a divorce. My dog died. Like, it's been a whole thing. This 18 months has been crazy. And I just. I just been hearing about how I'm doing the wrong thing.

[Dave Ramsey]

Well, you've been doing the right thing. The only thing you're doing wrong is who you're hanging out with. But the.

[Caller]

I don't hang out with anybody.

[Dave Ramsey]

Yeah, well, whoever it is, it's you yapping at you. You need to get them some duct tape.

[Caller]

Yeah.

[Dave Ramsey]

But the. You're just so cool. I love you. You're awesome.

[Caller]

Thank you.

[Dave Ramsey]

Way to go. You're such a winner.

[Caller]

Y' all changed my life. Y' all changed my life.

[Dave Ramsey]

You changed your life. We just got to observe it.

[Caller]

Yes.

[Dave Ramsey]

Thank you. You're an inspiration. Now let me ask you, okay? Everybody's telling you you're crazy, and you hadn't had a pedicure, and life's been tough for 218 months. Was it all worth it?

[Caller]

Yes.

Yes. Because you know why? Listening to everything, listening to your show. I got a financial advisor through Ramsey. I have an IRA. I have a 401k. I was minus 40,000 net worth, and now I'm almost 200,000 net worth because of you.

[Dave Ramsey]

I didn't do it. You did it.

[George Campbell]

Quarter million dollar swing.

[Dave Ramsey]

I'm so proud of you.

[Caller]

I had life insurance and everything. I did all this stuff, and I'm like, I just want to do this last one. I want somebody to understand and celebrate with me.

[Dave Ramsey]

Well, you got the right people. We all want to celebrate with you. You're fun.

[Caller]

I'm just. I'm so happy to be here.

[Dave Ramsey]

Awesome. Very cool. So what are you gonna do? You're gonna, like, hit submit on the payment button or something and say, yeah, bye, bye.

[Caller]

City is not working. Of course it's not working. I'm trying to get my face ID to work.

[George Campbell]

Oh, gosh.

[Dave Ramsey]

Well, it doesn't recognize you because you hadn't had a pedicure.

[Caller]

I've had it open all this time, and now it won't.

Of course.

It's my life.

[George Campbell]

That's the devil in that technology trying to block a blessing.

[Caller]

Seriously, I've had it open all day.

[George Campbell]

What's left on the. On the balance that you're about to pay off?

[Caller]

$2,092.53. All right.

[George Campbell]

Amazing.

[Dave Ramsey]

Very cool. Well, I think we can count it. I know you're going to be able to pull it off once you get off the pressure of being on the air and trying to do the face and all that stuff, but yeah. All right, so here's what I want you to do. I want you to tell me now that you're debt free, how's it feel?

[Caller]

It feels great.

[Dave Ramsey]

I can't believe this.

[Caller]

I've had this open all day waiting to do this, and now it's not going to let me.

I'm so sad.

[Dave Ramsey]

It's okay. We're going to count it. It's the same thing.

[George Campbell]

If it happens 30 seconds from now, it'll still. It'll still be magical.

[Caller]

Oh, I'm so sad.

[Dave Ramsey]

You'll work.

[Caller]

I can't believe this happening to me right now.

[Dave Ramsey]

I'll tell you what. I tell you what we're going to do. You're going countdown and scream I'm debt free. We're going to put you on hold. Christian is going to check back with you in a few minutes, and if you get the thing working, we'll bring you back on the air. Okay? And if you don't, we'll just know. We'll just know that you did it at home. Okay?

[Caller]

Yes.

[Dave Ramsey]

All right, Count it down. 3, 2, 1. I'm debt free. Scream it.

[Caller]

3, 2, 1. I'm debt free.

[Dave Ramsey]

Yes, you are.

[George Campbell]

We got the music and everything.

[Dave Ramsey]

Got the whole backdrop, the whole. The confetti fell in the studio.

[George Campbell]

Just snuck in a debt free scream right there.

[Caller]

Wow.

[Dave Ramsey]

Pretty cool. Pretty cool. All right, check back with her in a few minutes and make. If she can get up, we'll let her push the submit button on the scout's honor. First time we've done that one, I think. Way to go. Very cool. Jeff is in Tyler, Texas. Jeff, what's up?

[Caller]

How's it going, Dave?

[Dave Ramsey]

Better than we deserve, sir. How can we help?

[Caller]

I knew you were gonna say that. So me and my wife have been extremely Blessed we are 45 and 46 years of age. Got four children. We have make it about 330 a year.

[Dave Ramsey]

Wow.

[Caller]

Have been for a little while now. We are out of debt, except for our house finally, which is fantastic. My biggest question is, we've got about 650,000 in a 401k and when I, I get on the Dave Ramsey investment calculator, it's by the time we retire, it's a pretty dead gum big number. And I'm really, really worried about our investment strategy if we continue maxing out our 401k like we have been doing with my company Match. And when it comes to required minimum

[Dave Ramsey]

distributions, your company doesn't have a Roth 401K.

[Caller]

Well, they have a Roth IRA. I'm not 100% sure about a Roth 401K. If we do, I'm not aware of it, but that's something that I look at.

[Dave Ramsey]

So 80% of the companies that have a 401k have a Roth option.

[Caller]

Okay, I'm sure that they probably do.

[Dave Ramsey]

Then, then start, start your contributions from today forward being Roth. That's the first step.

[Caller]

Okay.

[Dave Ramsey]

Yeah. Cause there's no RMDs on Roth.

[Caller]

Correct.

[Dave Ramsey]

Okay. No. Required minimum distribution is 73. Then the second thing is let's get the house paid off. And when the house is paid off, I'm going to start moving all of it at once or at some point or move chunks of it, whatever. However we need to do it, whatever your bracket CRE on your income, whatever you're looking at, I think you're probably creeped out on the actual brackets. But anyway, I'm going to move chunks of it to Roth and pay the taxes as a part of my investment strategy so that all of the growth from this point forward is tax free and so that I avoid RMDs. And you got time to do this. So get the house paid off and then cash flow, the taxes that are created without having to touch the Roth, without having to touch the amount. So let's say you're 600,000 in there, you move 200,000 over, it creates $40,000 in taxes. You got the extra 40,000 because you don't have a house payment anymore. And you just pay that 40,000 in taxes and you move the whole 200,000 over and you do that in like three chunks or four chunks or whatever and you get it all moved over there. And then by the time it gets there, it's going to be millions and millions of dollars. As you, as you are.

[Caller]

Yes.

Sir.

[Dave Ramsey]

And so, yeah, you're. You've. You've anticipated a problem way in advance. Congratulations. That's called wisdom.

[Caller]

Fantastic.

[Dave Ramsey]

Yeah. And then there's an added benefit that you hadn't even got to yet. I didn't even think about this stuff in the old days. I did all Roths and converted everything to Roth as fast as I could. As long. As long as I can look back. And I had no. I wasn't even thinking about RMDs. And at the time. And I wasn't thinking about estate planning either. But here's the thing. You can name a beneficiary on this Roth. There's no taxes, no income taxes to your heirs.

[George Campbell]

They're going to love you even more.

[Dave Ramsey]

Yeah. And if it's a stupid traditional, they got 10 years under the Biden act, the Biden Secure Act, 3.0. They make you cash. They make the inheritance diary, make you cash it out. It's a sort of RMD on an inherited required minimum distribution. You got to get all out of there in 10 years. And none of that applies. So all mine's Roth. So my kids have no problem with any of this. It all goes to them. No taxes. Except estate taxes. But that's a different issue. Hey, guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey priority principles we use on the show. Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple, and free to use. Go to ramseysolutions.com and try Ask Ramsey today. That's ramseysolutions.com. Our scripture of the day, Isaiah 40:31. But those who hope in the Lord will renew their strength. They will soar on wings like eagles. They will run and not grow weary. They will walk and not be faint. And Rand said, money is only a tool. It will take you wherever you wish, but it will not replace you as the driver. Well, I gotta tell you, every dollar, our best app ever in the financial world that walks you through the Ramsey process and builds a budget for you and gives every dollar a name, every dollar an assignment is absolutely exploding. The number of people that are signing up for this is going crazy. It's awesome. You can start it for free in the App Store or Google Play and it will walk you through the whole Ramsey process. And in the first 15 minutes, when you're just filling out the stuff. It's going to help you find margin from the day one. And then I'm going to show you how to apply that margin to the fastest, quickest way to build wealth. It's free in the App Store or Google Play, every dollar. So Lee in New York was able to push the button and she made it. And we're not going to put her back on after all. But she got to do her debt free screening. We confirmed it and we have confirmed that Citibank is no longer in her life, which is awesomeness. Awesomeness. Awesome awesomeness. Mark is in New York as well. Hey Mark, what's up?

[Caller]

Hello. Thanks for having me on.

[Dave Ramsey]

Sure. Well, how can we help?

[Caller]

Yeah, so I'm getting married this coming summer. My fiance and I are working through a bit of a concern. She is in her fourth year of college, going to graduate this spring. The way she financed through college was her parents had told her that they were taking care of it and there was going to be a small loan in her name. There's a small loan in her name right now. And now they're saying that they have a very, very large parent plus loan that they're just telling her about now that they expect her to pay back when she graduates. We're looking to figure out how to navigate that.

[Dave Ramsey]

I'm sad for you, man. You're marrying into a weird. Yeah, this is going to be a long, drawn out bunch of drama. You get married a year from now.

[Caller]

Yeah.

[Dave Ramsey]

Okay, well, I mean, the answer to your question is simple, but the results are not going to be. The simple answer is your fiance is not liable for a parent plus loan legally. And if she did not tell them about the loan, she did not say, mom and dad, y' all sign up for this and I, I'll pay it then. She's not morally obligated either. And from the story you're telling, she didn't even know about it, much less agree to pay it. Is that correct?

[Caller]

Correct.

[Dave Ramsey]

Okay.

[George Campbell]

How much is the loan?

[Caller]

Her federal one, I believe is 35,000.

[Dave Ramsey]

That's the small one.

[Caller]

That's the smaller one one. The parent plus one is 100,000.

Good.

[Dave Ramsey]

And she's going into her senior year.

[Caller]

Correct.

[Dave Ramsey]

So she's got a year to go and they're going to pay for that with loans as well that I had

[Caller]

used the, like the total for all four years. Like we know the total numbers that we have.

[George Campbell]

She's covered until graduation at this point through the student loans. Okay.

[Dave Ramsey]

No, they already have they already paid her tuition for the entire year.

[Caller]

They had put up the parent plus loan for it, so in theory, yes.

[Dave Ramsey]

Well, I mean, if they paid the tuition, they can't unpay the tuition.

[Caller]

Yeah.

[Dave Ramsey]

Okay. Because when she tells them, no, I'm not going to pay this, I didn't agree to, they're going to be pissed. Yeah, they don't have a right to be. They're jerks, but they're going to be pissed. How old are you?

[Caller]

23.

[Dave Ramsey]

And what will you two be doing for a living?

[Caller]

I'm going to be working in the medical field and she's going to be a teacher.

[Dave Ramsey]

What does medical field mean?

[Caller]

It's like staffing.

Okay.

[Dave Ramsey]

And you have a four year degree?

[Caller]

Yes.

[Dave Ramsey]

And do you have student loans?

[Caller]

I do not.

[Dave Ramsey]

Okay, well, this is just an old guy talking. Now, when you marry a young lady who is getting ready to fracture the relationship with her parents, it's going to be very, very hard for her. She's going to be in a lot of pain. And so your marriage is going to be impacted by that pain.

[Caller]

Right.

[George Campbell]

The wedding might be a little awkward is what we're about talking, trying to

[Dave Ramsey]

say, well, life is going to be awkward. There's some dysfunction here because these people are jerks. You don't spring $100,000 loan on somebody that didn't agree to pay it out of the blue after they get engaged going into their senior year. And we don't call you a jerk. You're a jerk if you do that. This is your kid that you promised to take care of the education and then you changed your mind. Okay? Now if that's what really happened, then these people are jerks. Now if there's another part of the story we're not getting, then there's a different thing. But when your wife says to her parents, I'm not paying this, it's not going to go well, Mark. And I don't think she should pay

[Caller]

it,

[Dave Ramsey]

but it's not going to go well. She's going to have a. You're going to have a negative experience here. Count on it.

[Caller]

Yeah, and I could sense them throwing that they did a good thing back at her, but I don't feel it.

[George Campbell]

How did she think this was all being paid for if they just sprung this hundred thousand dollar loan and said, oh, by the way, we took this out, you got to pay.

[Caller]

They were taking care of it and she was going to have a small loan. So she was going off what was on her credit report for the federal loans.

[Dave Ramsey]

They were taking care of it, but they. She didn't have any idea that they didn't have any money.

[Caller]

No.

[George Campbell]

If Dave says, hey, I'm taking care of dinner, I assume that means Dave is paying and has no expectation of me to pay him back. So the communication here is terrible.

[Dave Ramsey]

Wait a minute, George. How did I get in this?

[George Campbell]

I'm just saying I'd like a free dinner. Thought I could squeeze that in. Oh, man.

[Dave Ramsey]

Yeah. Mark, Mark, this is a problem relationally. It's not a problem legally and it's not a problem morally. So the answer is I would don't you get involved. But I would tell her to tell her parents that mom and Dad, I did not agree to pay this. And you can't spring it on me in the 11th hour and turn me into a pumpkin. It's not going to work. I'm not going to do pumpkin. You get the pumpkin. You signed up for it and I'm not paying it. I'm so sorry. I hope you understand that. You didn't tell me about this. I didn't sign up for it all along. If I have integrity and if you told me about it up front, I would have could have made the decision to whether or not to take this on. But you can't just come along and drop this like freaking atom bomb into my life and I'm not going to pay it. I'm sorry. I love you, but no. And then they're going to go and you're going to have to listen to your wife talk, your fiance talk about her parents and they're going to.

[George Campbell]

You're going to be the therapist for

[Dave Ramsey]

a while and listen to her for the next 30 years. Because after. It's not this thing, it's going to be something else with these people. These people are screwed in the head.

[George Campbell]

I wouldn't expect a nice wedding get from them.

[Dave Ramsey]

I wouldn't expect anything that isn't caught drama associated with it for the next 30 years. I really wouldn't. I mean these, you know, integrity is integrity and this is just going to bleed over into everything else that goes on here. These people. Now I am questioning whether this is really what's happening or not. It's bothering me, but I'm going off of Mark's word that this is what his fiance said and he's got it very dialed in and his mind. But I'm wondering if there's other conversations that the fiance forgot or something like that. So. But if it went down exactly the way he laid out, then we're just going to blame it all on the parents being dysfunctional, screwed in the head and whatever.

[George Campbell]

Parent plus loans are one of the worst.

[Dave Ramsey]

I hate parents.

[George Campbell]

Not just financially.

[Dave Ramsey]

This is the. This comes up all the time. We hear this call all the time. Parents do parent plus loans and then they meant to do it. Then they get a divorce and I can't afford it, so you gotta help me because I'm stuck. Cause your daddy left me after 23 years.

[Caller]

Yeah.

[George Campbell]

Even if they say, hey, we're gonna

[Dave Ramsey]

pay it, this is what happens. This is what happens when you do these stupid butt student loans. And let me help you guys. 35,000 is not a little student loan, Mark. It's a big butt student loan, especially for a teacher. 100,000 is three times a big but. Okay, that's a lot. It's three big buts. That's horrible.

[George Campbell]

So many big buts.

[Dave Ramsey]

This is ridiculous, y'.

[Caller]

All.

[Dave Ramsey]

I mean, we've. We've got now gotten dumbed down to where we think a 35,000 is a small one. That's a big. That's ridiculous, you guys. No, no, no, no, no, no. None of this is okay. And you parents, stop doing this crap. Don't put your kid in a school unless you can pay for it or they can pay for it or both of you together pay for it. Stupid.

[George Campbell]

Have some integrity.

[Caller]

Community.

[Dave Ramsey]

Bruise up families generationally. This is what Congress is doing to you. That puts this hour of the Ramsey 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.