Do You Have Too Much Month Left at the End of Your Money?

Summary

Podcast Summary: The Ramsey Show - "Do You Have Too Much Month Left at the End of Your Money?"

Release Date: January 21, 2025
Host: Ramsey Network (Ken Coleman & Jade Warshaw)
Description: The Ramsey Show empowers listeners to build wealth and take control of their lives, regardless of past financial missteps. Hosts Ken Coleman and Jade Warshaw, alongside financial experts, address listeners' top financial challenges, offering practical solutions and insights.

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Introduction and Upcoming Events

The episode kicks off with Ken Coleman and Jade Warshaw promoting their upcoming free live stream event scheduled for January 23rd. They emphasize the event's focus on breaking the paycheck-to-paycheck cycle, budgeting, debt reduction, savings, and investing. Listeners are encouraged to sign up for a chance to win $4,000 in cash through multiple giveaways.

Notable Quote:

• Ken Coleman [00:00]: "Join our free live stream event and you could win $4,000 just for signing up."

Caller Stories and Financial Advice

1. Managing Medical Debt Without Insurance

Caller: Zane from Dallas, Texas
Issue: $115,000 in medical debt due to a severe car crash; 19 years old without medical insurance.
Discussion:
Zane explores options for handling substantial medical debt incurred from an accident. With no insurance and limited income, he faces high debt with uncertain repayment prospects.

Advice Provided:

• Jade Warshaw [05:29]: Encourages Zane to negotiate a hardship payment plan with the hospital, emphasizing the importance of communicating his inability to work and pay due to injuries.
• Ken Coleman [07:15]: Suggests potential settlements and reiterates the importance of creating a payment plan considering Zane's current incapacitated state.

Notable Quotes:

• Zane [04:53]: "I don't want to be straddled with that debt."
• Jade Warshaw [05:36]: "If you don't pay these, they would roll into collections, and some collections agency would end up buying them for pennies on the dollar."

2. Prioritizing IRS Debt Amid Debt Snowball

Caller: Matt from Phoenix, Arizona
Issue: IRS intent to levy for $14,000 in taxes; lost payment plan paperwork.
Discussion:
Matt seeks advice on whether to prioritize IRS debt over his current debt snowball strategy, especially with an upcoming work bonus that could clear the IRS debt.

Advice Provided:

• Jade Warshaw [11:14]: Strongly advises prioritizing IRS debt due to its severe consequences, such as levies and additional penalties.
• Ken Coleman [12:47]: Reinforces the priority of IRS debt, urging Matt to use his bonus to settle it promptly.

Notable Quotes:

• Jade Warshaw [11:25]: "In this case, it's always IRS debt... you want to get them off of your tail as quickly as possible."
• Ken Coleman [12:46]: "If you have this bonus coming up, [...] pay it off instantly."

3. Handling Fiancé’s Student Loans Before Marriage

Caller: Kyle from New York City
Issue: Fiancé has $65,000 in student loan debt; caller has $180,000 in savings.
Discussion:
Kyle is contemplating whether to pay off his fiancé's student loans in a lump sum before their upcoming marriage or continue following the debt snowball method.

Advice Provided:

• Jade Warshaw [14:26]: Recommends paying off the debt in a lump sum post-marriage after securing a financial buffer of three to six months of expenses.
• Ken Coleman [15:19]: Urges Kyle to proceed with the lump sum payment to eliminate high-interest debt, freeing up future cash flow.

Notable Quotes:

• Jade Warshaw [14:47]: "Set aside three to six months of your expenses and then pay off the student debt."
• Ken Coleman [15:21]: "We don't like debt."

4. Navigating Divorce and Financial Priorities

Caller: Emily from Denver, Colorado
Issue: Going through a divorce with two high school sons; deciding between funding college for kids or securing a lower mortgage on a new home.
Discussion:
Emily seeks guidance on prioritizing financial decisions post-divorce, balancing her children's education and securing a stable living situation.

Advice Provided:

• Jade Warshaw [16:57]: Suggests limiting mortgage expenses to no more than 25% of take-home pay and considering more affordable housing options outside Denver to reduce costs.
• Ken Coleman [19:38]: Emphasizes prioritizing housing affordability to maintain financial stability over funding college initially.

Notable Quotes:

• Jade Warshaw [17:42]: "No more than 25% of your take-home pay should be your mortgage."
• Ken Coleman [19:38]: "Your number one priority is keeping your expenses low."

5. Balancing Debt Snowball with IRS Obligations

Caller: Jared from Florida
Issue: Balancing IRS debt repayment with ongoing debt snowball strategy; IRS lost payment paperwork.
Discussion:
Jared is unsure whether to divert his debt snowball efforts to address his IRS debt, especially with a forthcoming bonus.

Advice Provided:

• Jade Warshaw [11:25]: Prioritizes IRS debt over other debts to prevent severe financial repercussions.
• Ken Coleman [12:46]: Advises using the bonus to settle IRS debt promptly, reinforcing the importance of clearing high-stakes debts first.

Notable Quotes:

• Jade Warshaw [12:18]: "The IRS is notorious for making mistakes."
• Ken Coleman [12:47]: "Settle it instantly."

Economic Insights: Inflation and Tariffs

Discussion on Tariffs and Inflation

Hosts: Ken Coleman & Jade Warshaw
Topics Covered:

• The impact of tariffs on small businesses and consumers.
• The relationship between tariffs, business costs, and consumer prices.
• The Federal Reserve's role in managing inflation.
• Historical context of inflation trends post-pandemic.

Key Points:

• Tariffs are designed to penalize foreign countries by making imported goods more expensive, which often leads to increased costs for consumers.
• Ken Coleman [33:01]: "Tariffs do become a tax for the consumer."
• Inflation has cooled, but many staple items remain significantly more expensive than pre-pandemic levels.
• Jade Warshaw [75:18]: Highlights that while inflation rates appear to have stabilized, consumer goods prices have not returned to their previous levels.

Notable Quotes:

• Ken Coleman [33:21]: "A tariff is meant to penalize a foreign country."
• Jade Warshaw [82:35]: "They're not going to go back to what it was."

Success Story: Baby Steps Millionaire

Caller: Alyssa from Green Bay, Wisconsin

Issue: Achieving a net worth of over $1 million by age 34 through disciplined budgeting and investment.
Discussion:
Alyssa shares her journey to becoming a Baby Steps Millionaire, detailing how she and her husband intentionally managed their finances to reach significant wealth milestones.

Advice Provided:

• Alyssa [72:12]: Emphasizes the importance of setting financial goals, being intentional with budgeting, and aligning spending with personal values.
• Jade Warshaw [73:03]: Highlights that building wealth doesn't require flashy lifestyles but consistent, intentional financial planning.

Notable Quotes:

• Alyssa [67:51]: "Having a goal is like, number one."
• Jade Warshaw [71:10]: "It makes it feel so accomplishable."

Practical Financial Tips

Debt Management and Budgeting

• Prioritize High-Impact Debts: Focus on clearing IRS debts and other high-stakes obligations before other debts.
• Emergency Funds: Maintain a robust emergency fund to handle unexpected expenses without derailing financial plans.
• Intentional Spending: Align spending with personal values and long-term goals, avoiding unnecessary expenses despite external pressures.

Investment Strategies

• Early and Consistent Investing: Even at a young age, start investing early to take advantage of compound interest, but balance it with current lifestyle needs.
• Diversified Portfolio: Spread investments across retirement accounts, brokerage accounts, and savings to ensure financial growth and security.

Handling Inflation

• Adjust Budgets Accordingly: Recognize that certain staple goods may remain expensive and adjust budgets to accommodate ongoing higher costs.
• Focus on Essential Spending: Prioritize spending on essential items and reduce discretionary expenses to manage budget constraints effectively.

Conclusion and Final Thoughts

Ken Coleman and Jade Warshaw wrap up the episode by reinforcing the importance of proactive financial management, prioritizing debt repayment, and maintaining a balanced approach to spending and investing. They encourage listeners to engage with upcoming events and utilize the resources provided by Ramsey Solutions to stay on track with their financial goals.

Notable Quote:

• Ken Coleman [83:44]: "So if you're feeling it at the grocery store, you're right."

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This episode of The Ramsey Show offers a comprehensive exploration of various financial challenges faced by individuals and families, providing actionable advice and inspiring success stories. From managing substantial medical and IRS debts to navigating divorce-related financial decisions and understanding economic factors like inflation and tariffs, Ken and Jade deliver valuable insights to help listeners achieve financial stability and wealth.

Transcript

[Ken Coleman]

Hey, guys, if you're ready to get ahead with money and start building wealth this year, don't miss our free Take Control of youf Money live Stream. It's on January 23rd and you could win $4,000 just for signing up. You got nothing to lose. Go sign up right [e-mail] livestream. Welcome, Ramsey Show America. This is where we help you win in your life. We want you to win with your money, win in your profession, and win with your relationships. Alongside the fabulous Jade Warshaw, I'm Ken Coleman. Excited to be together. For you folks today, the phone number to jump in is, is, 882-55-5225. Triple 882-55-2225. And the new year is off and running. And I looked up today, Jaden, it's like, where did January go, man?

[Jade Warshaw]

What?

[Ken Coleman]

Come on. And so, hey, if you're trying to get control of your money, we're not talking about a New Year's resolution. You're just saying, listen, 20, 25, we just got to. We have to stand on business.

[Jade Warshaw]

Hey, come on. Ken Coleman. Yeah. You're 25. This teaching me this is life change, right? We are making real changes, real progress with our money and we have just the thing to help folks out. Ken.

[Ken Coleman]

That's right. Coming up this Thursday, my friend right over there to my right, she is going to be on the stage with Dave Ramsey. They are headlining our free live stream event. Tell them what it's going to be and what it's going to do for them.

[Jade Warshaw]

We are going to help you break the paycheck to paycheck cycle once and for all. That's really what it's about. How many can know how it feels to have more month left but the money is gone, Right? How many of us know what it feels like to be overdrafting our account? Then you pay that 34 fee. Embarrassing, man. It's embarrassing when you're always checking your account before you swipe for your groceries at the grocery store because you don't want to, you know, you want to make sure there's enough money there. We're going to help you with that. The, the fact is people are feeling tightness with their money. They're not sure where to go. And the truth is people have tried to have goals in the past with their money and another year passes and they're still in debt or they still don't have that savings. So we're going to help you. It's a free live stream event. We're going to go over exactly what it's going to take for you to get on a budget, start paying off debt, start building up savings. We'll touch briefly on investing all of that. You can sign up right now at ramseysolutions.com/livestream. And Ken?

[Ken Coleman]

Yeah, this is fun.

[Jade Warshaw]

If you sign up, you're going to be registered to automatically be in our drawing to win $4,000 cash. We're doing five different giveaways.

[Ken Coleman]

Yeah. Isn't that crazy? Five people will win $4,000. And after you sign [e-mail] live stream, create a free everydollar account to get a bonus entry in the giveaway because you guys are going to be using every dollar during the live stream to show you the fastest, most practical way to get control of your this Thursday, 7pm Central Time, ramseysolutions.com livestream.

[Jade Warshaw]

And for anybody who was there on the last event, some of you are like, oh, are you doing an every dollar demo? I am going to go over every dollar, but it's a very small piece of what we're doing. So still tune in. Even if you've seen me do an everydollar demo, I'm going to do that, like literally in five minutes. So tune in because we're talking about a lot. And Rachel Cruz and George camel are going to join us.

[Ken Coleman]

Going to be a cameo. So it's going to be a lot of fun. Don't want to miss that. All right, let's get to the phones. Zane is going to start us off in Dallas, Texas. Zane, how can we help today?

[Zane]

Hey, am I on live?

[Ken Coleman]

You're live, yes.

[Caller]

Oh, cool.

[Ken Coleman]

This is your moment.

[Jade Warshaw]

Do you have something planned?

[Zane]

No, I don't. I was wondering that. Well, my problem, they told me to kind of get to my question. I'm $115,000 in medical debt as of right now and I'm 19 years old.

[Jade Warshaw]

Oh, man.

[Ken Coleman]

What happened? Give us the quick version of what.

[Zane]

Happened three months ago. I got into a high crash or a car crash at about 60 miles an hour, broke both my legs and had to spend a week or two in the hospital and have been out of work for the last three months.

[Ken Coleman]

What's the status on being able to get back to work?

[Zane]

I'm just now able to kind of waddle around my house like a penguin. But walking still not that great right now. And the doctors are kind of telling me that I'm not going to be able to go back to construction for the next year or at least.

[Jade Warshaw]

So was there A. Is there a settlement coming out of this? I mean, were you at fault, or are you going to get paid off of this?

[Zane]

I think I was at fault, if I believe correctly. Yeah.

[Jade Warshaw]

Oh, that's tough, my man. That's real tough.

[Caller]

Yeah.

[Zane]

Sorry for interrupting.

[Jade Warshaw]

No, go ahead.

[Ken Coleman]

Well, my.

[Zane]

My question was, is that at 19, I've kind of been given two options of how to handle the $115,000 of debt that I'm in. And it's to either, you know, counter them and say that I'm not going to pay it and agree on a lower settlement of, you know, 60 to 80,000 or whatever, or to just not pay it and let it really, you know, hit my credit score and let the credit score drop. And I don't know which of those choices to go with at this point, because I've never had to use my credit, and I don't think I will in the next seven years. Well, again, I don't want to be straddled with that debt.

[Jade Warshaw]

Tell me about. Were you on it? Did you not have medical insurance at the time? Tell me more about that, because what I'm thinking. No medical insurance.

[Zane]

No, ma'am.

[Ken Coleman]

Do you live at home?

[Zane]

I was living on my own in a travel trailer because, you know, it's the cheapest thing you can live in as a young teenager. But now I am. My awesome mother is taking care of me while I'm recovering.

[Jade Warshaw]

So the truth is, if you don't pay these, they would roll into collections, and some collections agency would end up buying them for pennies on the dollar. And the truth is, when things go into collection. Yeah. You're more likely to be able to strike some sort of deal and say, okay, I can pay you if it's 115,000, I can pay you 40,000, or I can pay you 60,000. And it's usually a cash deal. I don't like that for you because a. Like you said, you're taking your credit, and it's kind of. It just feels like a hopeless thing. What I would do is I would start with, okay, is there any type of payment plan I can be on? And there's probably some sort of. I don't want to say the term forbearance, but, you know, when you're going through a hard time and they kind of give you a break there until you can start working again? Because the truth is, you're not able to work at this point, and we have to figure out what that means for you next, right?

[Zane]

Yes, ma'am. I'M hoping to be able. I kind of through my dad. My dad's an oil field man and he, there was a plan for me to move out to the oil field and get kind of a desk job out there that would pay better than construction and allow me to work, you know, while sitting down. And that was the plan moving forward. If I was going to be, you know, paying this off, that was the plan either way. But that was kind of my only way in my mind of, yeah, when.

[Ken Coleman]

Is that going to happen?

[Zane]

Pay this off.

[Ken Coleman]

When are you going to take that job?

[Zane]

As soon as I can walk again and get my, my trailer moved out to Midland.

[Ken Coleman]

Fantastic. Okay. So there, there's income and I think Jade's right. You call the hospital, get a hardship.

[Jade Warshaw]

Or something and you talk to him.

[Ken Coleman]

About what you'd like to do and if you can settle for Jade. What do you think about his initial idea of settling for a much lower number?

[Jade Warshaw]

I think that if it comes to that, that's okay. But I would not intentionally tank my credit. Like, I would not intentionally not make the payments to tank my credit so that it gets sold off. I wouldn't do that if that happened because of circumstances that you couldn't help, which happens every time and people call in, fine.

[Ken Coleman]

That was his second option. His first option was going to the hospital and saying, look, I just, I don't know if I'll ever be able to pay that back. Can we do a lower number?

[Jade Warshaw]

Yeah, yeah. Okay. I do like the idea of you going to the hospital and saying, hey, obviously this is the extent of my injuries. Obviously I did not have insurance. Obviously it's going to take me some time. Is there some sort of payment plan I can work out that takes into account my hardship right now? Yeah, and I think they will do that. But I don't want you to go into this with a hopeless mindset of saying I'll never be able to pay off because I don't believe that. I think you can.

[Ken Coleman]

Yeah, I agree. I think you tell them, Look, I'm 19 year old kid, I didn't have insurance. Here's why. Tell them your story. Yeah, and if you could get it to 60, that's a number you threw out, that's very doable for you to pay that off. But as soon as you can get healthy, yeah, man, you're getting out the Midland and man, you're a young Billy Bob Thornton out there.

[Jade Warshaw]

Hey, man, I gotta tell you. Ken, Ken. It's good, isn't it?

[Ken Coleman]

It's so good. I got ahead of it and got in trouble with Stacy, so I had to slow down.

[Jade Warshaw]

Yeah, you gotta watch it get mama.

[Ken Coleman]

Caught back up on it. And I gotta tell you, it's not.

[Jade Warshaw]

For the faint of heart, though.

[Ken Coleman]

Yeah, yeah. Great show. Get your popcorn out for that one. All right, we'll be right back. This is the Ramsey Show.

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[Ken Coleman]

Welcome back to the Ramsey Show. I'm Ken Coleman alongside Jade Warshaw. The phone number for you to jump in is 888-2552. Today, we'll focus on your money questions, of course, and also your professional questions so we can make more money and. And create more margin through the baby steps. 888-255-2225 is the number. Matt is joining us now in Phoenix, Arizona. Matt, how can we help? Hi.

[Caller]

Thanks for taking my call, guys. So we are snowballing our debt and doing everything we can, but we just got a letter from the irs. It was a notice to a notice for intent to levy possessions for our 2023 taxes. We filed the taxes and everything and we owed about $14,000 from 2023. So we submitted all the paperwork and a down payment to set up a payment plan to pay that back. While we're kind of snowballing all of our other debt.

[Jade Warshaw]

Okay.

[Caller]

But they somehow they managed to cash the check for $1,000 as a down payment but lost our paperwork to set up the payment plan.

[Jade Warshaw]

Classic.

[Caller]

So it kind of got me thinking, is there debt that's, like, more important to pay off than other debt, or should I just throw this all into the snowball? Because I know I have a work bonus coming up pretty soon that would pretty much wipe out that IRS debt.

[Jade Warshaw]

Huh.

[Caller]

So, like, should I use it for that IRS or just keep on. Keep on doing the snowball?

[Jade Warshaw]

Yeah. No, you are 100% right, Matt. There. There is some debt that's important than others, and in this case, it's always IRS debt. So when you're working your debt snowball, we always say if you have IRS debt or if you're, you know, behind on your mortgage, that sort of thing, that jumps to the top of the list, regardless of the fact, because they can do so much damage. And let's be honest, nobody likes working with the irs. It is a pain in the butt, and you want to get them off of your tail as quickly as possible. So if you have this bonus coming up, when does it come?

[Caller]

End of February?

[Jade Warshaw]

Yeah, I. I'm knocking that out instantly. And just make sure you keep record of everything because the. Listen, the IRS is notorious for making mistakes. I can't tell you how many times with our business, we got sent a tax bill that was incorrect and we had to fight it and had to show proof. And, you know, you're always jumping through hoops with them. So whatever you do, make sure there's a very clear paper trail so that if this thing rears its head again, you've got everything documented.

[Ken Coleman]

Okay?

[Jade Warshaw]

Yeah.

[Ken Coleman]

Thanks for the call, Matt. Thanks for the call. Excuse me. My voice just went out on me there.

[Jade Warshaw]

Limped.

[Ken Coleman]

Yeah. Kyle is joining us now in New York City. Kyle, how can we help?

[Caller]

Hello. I have a quick question. I am looking to get engaged soon, and my fiance has some student loan debt, about 65,000 of it. And I live at home. I own my own business. I've been able to save up quite a bit. I have about $180,000 saved up between different accounts. Some in retirement, some, and some brokerage accounts, and others in, like, just normal checkings and savings accounts. I was curious about how should I go about handling paying this debt? Would something like a lump sum just handling it right away be wise? Would doing it over a period of time be wise? I've never had debt, so I don't know, like, the best route to actually paying it off.

[Jade Warshaw]

Listen, that's a great question. When do you guys get married?

[Caller]

We're planning to get married in October of this year.

[Jade Warshaw]

Okay, so when and only when you get married after you've said, I do. I think it could be a good idea to pay off this debt, depending on how much of your 180k saved is in non retirement funds. So can you kind of break that down? How much of it is non retirement?

[Caller]

Yeah, so about 30,000 is in a Roth IRA and then I have like 50,000 and just like the S&P 500 and the rest is broken up between like a savings account. So like, like the rest 100,000 is in savings accounts, like high yield.

[Jade Warshaw]

Okay.

[Caller]

And checking accounts and also in like my business checking account.

[Jade Warshaw]

Okay. So of the 150 that's we'll call liquid because the index funds, if you don't have to touch it, you don't have to. But of all of that, how much would you say would be three to six months of expenses for you and your wife once you're in your lifestyle?

[Caller]

Yeah, I haven't yet calculated that out. I know what mine is currently. Okay, but that's something that I would have to calculate.

[Jade Warshaw]

I think that you're going to be fine. But what I would do is I would just set aside three to six months of what? Once you guys are married, set aside three to six months of what will be your expenses and keep that in a high yield. And then if you still have the 60000 liquid or 65, 000 liquid to pay this off, I would pay it off. And even if you only have 55, I would do it in a lump sum and then I would cash flow the rest of it until it's gone.

[Caller]

Okay, great.

[Jade Warshaw]

Yeah, I. Hey, I love your heart behind this. I love that for you it's just as easy as saying, yeah, I'll write a check. That's a good sign, my friend.

[Ken Coleman]

It's a good dude. Yeah, very good dude. Let's go to Emily in Denver, Colorado next. Emily, how can we help?

[Emily]

Hi, I'm going through a divorce and have two high school sons and I'm wondering if I should rebalance some of my cash to help fund college or if I should try to get the lowest mortgage possible when I buy a different home.

[Ken Coleman]

How much cash are we talking about?

[Emily]

Well, that's. I don't know. I don't know what their plans will be, if they will go to a four year school or do something more technical.

[Ken Coleman]

No, I'm sorry, how much cash do you have?

[Emily]

How much? Well, it would be coming out of the home equity when I move homes.

[Ken Coleman]

Okay, so let's just back up so that we know what we're dealing with. We got to kind of get an idea of what you're talking about. So you're in a divorce you're going to move. How much equity do you have in the home?

[Emily]

Well, I'm in an expensive area, so we have. I'm assuming we. I will walk away with about 700,000 in home equity. 6 to 700,000. But the cheapest thing I can buy is probably 8 to 900,000.

[Jade Warshaw]

Okay.

[Emily]

For maybe a town home.

[Ken Coleman]

And then how old are the boys? What grades are they in?

[Emily]

Sophomore and junior.

[Ken Coleman]

Do you have any college money set aside?

[Emily]

About 12 to 15,000 per child.

[Ken Coleman]

Okay. All right.

[Emily]

And I'd like to help them pay for college so they don't have debt.

[Ken Coleman]

Do you work outside the home?

[Emily]

I do work full time, yeah.

[Ken Coleman]

What's your income?

[Emily]

160,000 a year.

[Ken Coleman]

Okay.

[Jade Warshaw]

Okay, that's good.

[Ken Coleman]

What would you say an all in budget for you is? Do you have a pretty good idea what your budget is on? This is not frills, but just paying for your basics and being comfortable. What's that number?

[Emily]

I don't have an exact budget because everything's been combined.

[Ken Coleman]

Yeah.

[Emily]

But I've been trying to crunch numbers and thinking I wouldn't want to mortgage more than $2,000 a month including insurance, HOA, anything like that.

[Jade Warshaw]

Yeah. Just a rule of thumb for you to keep in mind. We would say no more than 25% of your take home pay should be your mortgage. And that's including HOA, that's including taxes and insurance. So if 2K is 25% or less, then you're good. Something to keep in mind here. Have you priced it out in the Denver area? So if you're spending 650. Yeah. You're getting like a decent sized townhouse, is that right?

[Emily]

I'm just outside of Denver and right now the only three bedroom townhouse is 900,000. It'd be the cheapest I could afford. 900,000 to a million is what I'd probably be looking at for property.

[Jade Warshaw]

Have you considered going further out? Like I have friends that are, you know, 30, 25 to 30 minutes from the Denver area, family of four and they're looking at things in the six to $700,000 range. And I've been to their house and it's fine. Yeah.

[Emily]

Where, where I am, I'm between mountain passes and I wouldn't want my kids to have to drive mountain passes in the winter to get to school.

[Jade Warshaw]

I hear what you're saying. Okay.

[Emily]

So there, there is a balance for me on that cost.

[Jade Warshaw]

Two things to keep in mind here and I'll, I'll speak on the home side. Can you speak on the college side, we have to, we have to have very clean and clear expectations and very realistic expectations because the money that's going to come from the is sounds like a lot, but it's not a lot. And I think you're starting to feel that. And so, yeah, expectations on college, are they the types of kids that will go to college, you've got some money.

[Ken Coleman]

Saved, they're gonna have to work and they're gonna have to come up with scholarships and grants and then there's the father. So I would tell you that this is not all on you. I think you've got to make the right decision for your home. Keeping your expenses low as you're now out on your own, that's your number one priority, not cash flowing their college.

[Jade Warshaw]

And that's another good point. It's just you now, you've got kids that will be coming home, but that won't be a part of the home full time. And that's going to weigh into what you purchase when it comes to this home.

[Ken Coleman]

Yeah. So sorry you're going through this, but take care of you first. The boys will be fine. This is the Ramsey Show.

[Rachel Cruze]

You've got a lot to keep organized in life. Kids and calendars and carpooling and cleaning. I mean, it is so much. That's why you need a Knockbox. That way if something happens to you, you leave your loved ones with happy memories and not a huge mess. Knockbox is a complete system to help you organize your accounts, personal history, estate planning documents and all your other info in one place. I'm talking about everything from life insurance policies and social media accounts to your dog's vet divided into 15 simple categories. Plus they've got checklists that tell you what to add to each folder so your family won't have to guess where everything is. So start getting organized [e-mail] Ramsey your family will thank you. That's knockbox n okbox.com Ramsey.

[Ken Coleman]

Welcome back to the Ramsey show alongside Jade warshaw. I'm Ken Coleman. 888-255-2225 is the phone number to jump in. Today's question of the day is brought to you by our friends at Y Ref Refi. Why refi refinances defaulted private student loans. Defaulted means when the borrowers can't make the required payment. So if that describes you and your private student loan, please contact Y Refi. They can offer a low fixed rate loan built for you. Go to yrefi.comramsey today. That's the letter y r e f y.com ramsey it may not be available in all states.

[Jade Warshaw]

Okay. Today's question comes from Jared in Florida. He says, my wife and I are trying to get our debt under control. We aren't drowning by any means, but we have been using credit cards to build our credit. We have some credit cards that are 0% interest for a certain amount of time. Since these have a higher balance and are at the bottom of our snowball list, they would revert to full interest by the time we started aggressively paying them. Would you suggest paying the remainder of the 0% interest off ahead of the other debts to keep them from jumping to 24 to 26% interest? Oh, okay. That's a lot of percentages. What I think you're getting at is moving the debts out of order to avoid paying interest towards the end of your snowball, I might add. And no, I wouldn't. I would keep them in order because the truth is you're going to be going so fast by then and the amount that you're going to be throwing at the debt is going to happen so quickly. My guess is the math on this is going to be negligible because it's probably going to be the difference of a couple of months that this is going to take place. And I would use this as fuel. Like when I know. Ken, if they, if they come on the weather report and say that a snowstorm's coming, what do you do?

[Ken Coleman]

I laugh at how Middle Tennessee is going to react and realize that if we need any bread or dairy product, I should probably go now, thus contributing to the problem I'm laughing about.

[Jade Warshaw]

Yeah, you, you prepare is what I.

[Ken Coleman]

You were.

[Jade Warshaw]

No, that's fine. What you're saying is you prep, you know it's coming, so you do what you have to do to be prepared for it. And it's the same thing when you know that this interest is going to hit, you will have prepared for it. You have thought, okay, and if anything else, you might have tried to avoid it by going faster earlier so that you don't get to that point. So I think that this can be used as fuel to pay off the other debts faster.

[Ken Coleman]

Yeah, I agree. Good advice. Levi is joining us now in Minneapolis. Levi, how can we help?

[Caller]

Hey, so I guess to kind of jump into it. I'll give you guys my situation and where I'm at and everything with my life. I'm 22 years old. I am engaged with a one year old. We had our little one not too long ago. And ever since we found out about her, I've been on a debt free journey. I had about $15,000 in debt which had a mix of, it was home equity loan kind of thing and then some credit cards and stuff like that. I got all that paid off in about eight months. I am a full time electrician making about $55,000 a year and then I also do a lot of side work doing electrical stuff and handyman things on the side. Now that my daughter, she's getting up to the age of where she's kind of starting to realize like, oh, dad's around, dad's not around. I've been really wanting to spend more time with her. I have my three to six month's emergency fund fully debt free and we're getting married in September. We are cash flowing the whole wedding. We pretty much have everything accounted for. We have our tax returns going to be the last little bit about of our money that's coming back to pay for the rest of the wedding. But my main question is I don't know if I want to keep on doing these side jobs. Like, I mean, I cut back a little bit. I was getting more calls from people the more I did on a daily basis to do stuff on the weekends and I was getting burnt out. So I cut back a little. But I'm wondering if I should cut back even more now, rather only do a couple of months because I'm only being able to afford like around 6% of my income to invest in retirement and I feel like I should be doing more even though I'm 22. But I mean I'm, I got a, I got a good growth rate for my income. I mean that's gonna almost double in the next two years once I get past my journeyman's test. So.

[Ken Coleman]

So I guess so first of all.

[Caller]

Where you guys are at for that?

[Ken Coleman]

Well, first of all, I want to congratulate you on. You find out you got a baby on the way and you talk about adulting and growing up and manning up. I just want to call out, way to go, Levi, way to go.

[Zane]

Thanks.

[Ken Coleman]

Are you paying off your debt? You got a fully funded emergency fund. I mean, I'm just very impressed. So my only question that I have, Jade, is and Levi, for you, as you said, you're not able to afford more than putting 6% away for retirement. And I guess I don't understand that. What do you mean by I can't afford it?

[Caller]

Well, I mean I could, I can afford it. It's just more, I guess so for say, the comfortability of everything, like, I'm thinking, like, I have, I have all this time ahead of me. I'm like looking at how much I'm investing now. If I continue investing what I have now, I'll have over $3 million by the time I retire, which is going to be more to live off of. But I'm wondering, like, if I kind of hold back so that way we don't have to give up like all of our lifestyle so I can do more fun things with little one on the weekends and stuff like that and just do this 6% for the next two years. And then once I pass my test, I mean, that's a $10 an hour bump. And then from there I can keep my same lifestyle and then invest that full 15%.

[Ken Coleman]

Listen, I'm curious to know what my friend's going to say here. She's got a big old smile on her face, so I'm going to get out of the way. But my reaction to this is you are rationalizing this. And if you rationalize it now, you're going to rationalize it later when you got more income to do more fun stuff. And I think that the crux of the issue that started you down this path is you've been working like a madman, doing a great job. Can you cut back a little bit? Should you cut back a little bit? I think yes and yes. But I would use that extra, that extra weekend, one or two weekends instead of four. And that's how I would fund my 15. You know what I mean? I, I just, I would go ahead and start doing it now because my friend. Don't get Jade started on her investment calculator. That's all I would say.

[Jade Warshaw]

Well, he's already run it and 3 million is great. Listen, I'm smiling because you're 22, you have so much life to live. And I love that you have a path for your income to go up. And it will. Right now, my biggest. The questions formulating in my mind as you were talking are more so along. You said that you make 55,000 a year, which is really good, but that, that's including side hustles. So my, my first question is, well, if you drop the side hustles, what will you be making a year? And I don't like that number only because it's already lower than the, the median in the United States. And I kind of want you at least above the median. That's the median or above is what I would love for you the, the next Question I had was the wife, you know, when you guys get married here coming up, you know, what's the plan? Is she going to have income? Because that definitely factors into this right now. It will factor into it as soon as you get married. So tell us about that.

[Caller]

Yeah, so yeah, 55,000. That's my standard electric, my electrician job. And then on top of that I have side hustles, which this year has been better this year than the last two. I've been picked up, I picked up a lot more. I've probably this entire 20, 24, I probably made around 15,000 inside hustles throughout the year.

[Jade Warshaw]

15,000.

[Caller]

Yep. And then once she, once we get married, we have one little one right now and she, my fiance, she's working part time doing, working with my mom at our, at my mom's home daycare. So doing that we get free childcare and then she also makes an income of around 20,000 a year. But once we have the second kid, my mom can't afford to pay for, have two kids there because that factors into her number. So.

[Jade Warshaw]

Right.

[Caller]

The plan is to have my wife go be a stay at home mom at that point and then I will just be the main breadwinner at the time. And then she would do like being like a sub and stuff for the daycare here and there when like grandparents could watch the kids and stuff like that. So I mean her income maybe be like 10,000 a year after that.

[Jade Warshaw]

Those are the numbers you need to run and run them clearly. And both you and your wife have to decide. This is the life we've agreed on. John, John Deloney and I have talked about this many times that sometimes what you're signing up for is the used Camry lifestyle. And if you decide, hey, I don't want to do these side hustles, my wife's going to stay home. That is 100% your prerogative. But just know that making $55,000 a year, that is going to mean you're on a used Camry lifestyle. And there's nothing wrong with that. Just, just know I want you investing at least 15% off of your base income so that you're used to putting away $687 every single month whether you side hustle or not. And if that's a problem, check out where your mortgage or rent payment lies because if it's tight, that's likely. Why?

[Ken Coleman]

Yeah, but congrats on just stepping into being an adult and being responsible. At the age of 22, I got a sense that he's going to be okay whatever he does. This is the Ramsey Show.

[Rachel Cruze]

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[Ken Coleman]

Welcome back to the Ramsey Show. I'm Ken Kulmajayde. Warshaw is alongside. The phone number to jump in is 8888-2552-2588-8825-5225. And we are here for you. And my friend tells me right before we. We go live, she goes, I gotta. I gotta throw a little thought.

[Jade Warshaw]

You watch the inauguration.

[Ken Coleman]

I did.

[Jade Warshaw]

Of course you did.

[Ken Coleman]

So now you. We need to explain that because people make assumptions. I am a.

[Jade Warshaw]

Well, you're a political. Like you love politics.

[Ken Coleman]

Student of the process. I love the peaceful transfer of power. I like the tradition. We're the youngest country out there.

[Jade Warshaw]

True that. True that.

[Ken Coleman]

So it's kind of fun. I did watch it.

[Jade Warshaw]

Nice. I did a media hit this morning about, you know, the whole tariffs.

[Ken Coleman]

Yes.

[Jade Warshaw]

What say you?

[Ken Coleman]

Oh, I'm not a. I'm not pro tariff. I'm anti tariff.

[Jade Warshaw]

And the reason is on all imports, regardless.

[Ken Coleman]

I think it's a la. I think that they are a. I think tariffs have been useful economic tools. Many times they get turned into weapons. And here's my beef with tariffs for all the pro Trump people who are automatically canceling me or mad at me. Let me explain why.

[Jade Warshaw]

I was gonna say explain. Explain the pros and cons.

[Ken Coleman]

Because a tariff is meant to penalize a foreign country. All right, so let's just say that Trump puts a tariff on all Canadian products that American companies import in here and sell to you, the people.

[Jade Warshaw]

Yes.

[Ken Coleman]

It is meant to penalize Canada by making their products more expensive and thus trying to motivate American companies to pick another product. Here's the challenge when we say American made and nobody's more America first than me. And I'd love to see American workers make American products. However, our people, and I'm proud of this, get paid more than everybody else in the world. So it is very expensive for a small business. Let's take small business xyz. Let's say they import a widget from Canada. When Trump puts a tariff on that widget from Canada, it doesn't just penalize.

[Jade Warshaw]

Canada, it's going to pass on.

[Ken Coleman]

It's going to penalize a small business because let's say they've got orders coming in all the time and they go, I can't find a comparable widget from some other country and I certainly can't find one in America. It's going to cost me more. So that tariff is paid for by the small business.

[Jade Warshaw]

Sure.

[Ken Coleman]

Well, that small business can't afford to change their margin. So what do they have to do? They have to raise the price of said widget.

[Jade Warshaw]

That's right.

[Ken Coleman]

So in all reality, and I don't want to hurt anybody's feelings, but this is economics 101. This is not Democrat, this isn't Republican. This is just, this is how economics works. Tariffs do become a tax for the consumer.

[Jade Warshaw]

Well, in the short term.

[Ken Coleman]

Therefore, I am never for raising taxes, ever.

[Jade Warshaw]

Listen, I, So there you go. I think I'm with you. I, I'm.

[Ken Coleman]

What did you say?

[Jade Warshaw]

Well, on the media hit, I was talking about how obviously, like to your point, if you, if you put a tariff on the importer, that that price is going to pass along to the consumer. And if we really look at what we're importing, the main ones that are affecting, you know, everyday people in the United States, crude oil. I mean, you're going to see oil prices go up, you're going to see gas go up, like number one. And then even, you know, things like food. You know, we import things from other countries because we want avocados year round. You know what I'm saying? Like, we have gotten used to certain comforts here in the United States that we'll definitely feel that we'll feel it on coffee and, you know, certain fruits and vegetables and, I don't know, chocolate, that sort of thing. But is there a, I'm asking you, is there A short term benefit, long term gain thing here where we say, yeah, we might feel it in the short term, but long term, would we begin to see it play out in the way of, I don't know, what's, what's the end game here? More business being done internally?

[Ken Coleman]

Well, again, we're talking about President Trump. This is his policy. He's very pro tariff and he comes at it from a. Other countries need to be paying us more. You know, I want to bring more income to the United States and through the treasury, so forth and so on. It's just not that simple. And so therefore the answer to your question, I can't even simplify that because it's a. The answer is we don't know.

[Jade Warshaw]

True.

[Ken Coleman]

But, but traditionally when you raise costs for American businesses, it leads to inflation.

[Jade Warshaw]

Yeah. So no one wants to go back to that again.

[Ken Coleman]

Yeah. So 2022, you know, I'm consistent on this, people. I've been on Fox News and I made the host. He got a little, got his feathers ruffled when I just said, look, this is what I think about tariffs.

[Jade Warshaw]

Yeah.

[Ken Coleman]

I think the best thing that Trump can do or any president is cut regulations. So government regulations, things that cost businesses money to comply with, and cut taxes for businesses. When both of those things are cut, prices go down. When prices go down for the American people, theoretically, and this is what we're here to do, is that allows people more room in their budget if they aren't spin crazy. So I am always going to be low tax, low to no tariffs, because I believe in a free market system that takes care of itself. In other words, if the consumer wants to pull back, they pull back. That means if they pull back, guess what the companies do? They lower prices. Car prices go down when demand goes down.

[Jade Warshaw]

Right, right, right, right.

[Ken Coleman]

Housing prices go down when demand goes down. This is called a free market system and the market drives what's going on. I don't like government weighing in and I'm libertarian on that stuff. But again, that's just my position.

[Jade Warshaw]

I got you.

[Ken Coleman]

You don't have to agree with it.

[Jade Warshaw]

No, I think it's nice to hear. I mean, I felt like that was.

[Ken Coleman]

Pretty, you know, who needs less money? The government. You know, who needs more money? Folks, you find people, if you want to know, like vote for me because I'm pro people. I'm serious.

[Jade Warshaw]

The people. Ken Kahneman, the people's president.

[Ken Coleman]

I just don't want more money in the federal government. They don't know what to do with it. And I Think each of you people that are listening today and watching. And I mean this from the bottom of my heart. I mean, James Childs know me a decade. He knows I'm telling you the truth.

[Jade Warshaw]

Well, what do you think about.

[Ken Coleman]

I believe that you all can handle your money if you work with Ramsey Solutions, we teach you how to budget facts. But I believe the American people and the people of the world can manage their money better than anyone else can manage it for them. And I'm talking about government bureaucrats and politicians. That's what I believe at my core.

[Jade Warshaw]

Yeah, I, I agree with you. I do think that regardless of what the, the policies are, if you do the things that we teach. Like I always talk about five pillars of personal finance, right? It's love that budgeting. Like the idea you get out of debt, you stay out of debt. It's an. It's carrying the proper insurances, it's investing for the future, and it's prioritizing generosity. If you're five things, you're winning. And obviously you can use the baby steps to do that. But the truth is, like, certain things can impact us in a moment in a positive or negative way. Like, I would never sit here and say like this doesn't really matter. It doesn't affect you. Sure it does. What do you think about the idea that, like people who work on tips and things like that, that that might not be taxed?

[Ken Coleman]

Love it.

[Jade Warshaw]

I like that too.

[Ken Coleman]

I love any policy that lowers taxes now. I mean, you throw it at me. I'm have a hard time saying I'm not for that. I mean, I think people who rely on tips, they are relying on the generosity of the people that they serve. So if, if someone, if, if you and Sam and Stacy and I are at dinner and we were just at dinner a couple months ago and that. Remember that guy, kind of an artsy guy, musician guy. Either way, you don't remember it, maybe.

[Jade Warshaw]

Tell me more.

[Ken Coleman]

He did a great job.

[Jade Warshaw]

Oh, yeah, I do remember him. We sat outside and we all remember.

[Ken Coleman]

And the four of us, I feel like we all commented on. Here's my point. He served us so well that then the Warshaw family decides at that moment of the check to go. How much of our money beyond the meal are we going to give to this guy because we appreciate how he took care of us. And then the Colemans do the same thing.

[Jade Warshaw]

He should get to keep that.

[Ken Coleman]

The government gets to tax my generosity.

[Jade Warshaw]

No, no, no.

[Ken Coleman]

I'm sorry. The government gets to tax my appreciation.

[Jade Warshaw]

Well, they've taxed it.

[Ken Coleman]

I mean, don't tax my appreciation. Yeah, my man did a good job. He's out hustling for us. Yeah, I'm going to give him a little extra. Plus, they are going to tax.

[Jade Warshaw]

They already got their cut when I earned the money or when Sam earned the money. And now, now they're just. Because I'm going like this. You get to tax it again.

[Ken Coleman]

They taxed you when you got it. Now they're going to tax him when you give it now.

[Jade Warshaw]

Man, who?

[Alyssa]

Who?

[Ken Coleman]

Man, this is unifying the country.

[Jade Warshaw]

It is. I feel like a lot of people do feel that way.

[Ken Coleman]

Everybody feels this way.

[Jade Warshaw]

No, don't tax my tip now. That's.

[Ken Coleman]

So anyway, I hope that that goes through as well. But yeah, I think in general, I want people to have more of their hard earned money.

[Jade Warshaw]

I agree.

[Ken Coleman]

So that they can give, save and spend as we teach here at Ramsey Solutions. Give the way they want to give.

[Jade Warshaw]

Yes.

[Ken Coleman]

Save what they want to save and spend how they want to spend. This is what Thomas Jefferson meant when he said the pursuit of happiness.

[Jade Warshaw]

Get into it, Ken.

[Ken Coleman]

It's just this idea that this is the life that I choose to live. You said it earlier. If I want to drive a used Camry the rest of my life, then freaking drive a used Camry the rest of your life. This is your life.

[Jade Warshaw]

That's right.

[Ken Coleman]

And I think we need more of our money. So there you go.

[Jade Warshaw]

Good word, Ken.

[Ken Coleman]

Economics 101. Politics, by the way, is simple when you make it about that. This is the Ramsey Show.

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[Ken Coleman]

Welcome to the Ramsey show, where we help you win in your life. We're gonna help you win with your money, win in your profession, and win in your relationships. Triple 882-55-5225 is the phone number. I'm Ken Coleman alongside Jade Warshaw. 888-25-5225 is the phone number. By the way, our Ramsey show annual listener survey is now live. And we would love to know what you think of the show, what you like, what you don't what you want to hear more of. Whatever it is, we'd love to get your feedback. There's two ways to participate. You can text the word survey. That's the word survey. Text that to 337-89-33789. Or you can go to Ramsey Solutions.com survey ramseysolutions.com survey or you can click the link in the show notes on Podcast or YouTube. Sign up today and you will be entered to win a $500 gift card. But we would love to hear from you. All right, Alyssa is now on the line in Albany, New York. Alyssa, how can we help?

[Caller]

So 2024, like many, it set my family in complete financial turmoil because one thing bad happen after another and really a lot to do. My husband and I were on the same page with things, but like the execution, it just doesn't happen. And we're about to crash and I just need help trying to get out of it.

[Ken Coleman]

Oh, tell us a little bit more. What do you mean we're on the same page, but it's about to crash? Give us the specifics.

[Caller]

So just to give context, I had my second child last January. I was on maternity leave till May. My daughter, my oldest daughter had a couple of seizures. She's only 2. She had a couple of seizures in April. So unfortunately, that kind of opened the floodgate of a lot of issues that we're still dealing with now. And with that, you know, the medical bills and all that stuff, that's besides the problem. But anyway, I got back from maternity leave and I got let go as soon as I got back.

[Jade Warshaw]

I'm sorry.

[Emily]

Yeah.

[Caller]

So then I went, I went six months without a job, which was kind of okay because with finding out about my daughter's issue, my baby also has the same problem. So the only good thing is we know about it now. So now we're just trying to deal with things. So throughout that six months where I didn't have a job, we are. Our savings is empty. I had to dip into, completely into my Roth ira. I still have my regular ira. I didn't have to touch it. I had to totally empty my Roth. And now the good news is I have a job. I start a new job next week. But the problem, my husband is really spazzy. We talk about the money, and he says one thing to me, but really, if there's an issue, he just covers it up and tries to do all the gig work and the, the ride shares and stuff, and to try to.

[Emily]

Just fix it because he doesn't want.

[Caller]

To tell me because he knows I'm so overwhelmed, I'm just going to get upset. So now that I'm about to go back to work and everything's going to change and I'm not here, and I can't just settle up everything and try my best to start over again. I'm just afraid that everything's going to blow up in my face even more than it already has.

[Jade Warshaw]

Okay. Okay.

[Ken Coleman]

Well, first of all, you. You need some type of help. You can't go through this on your own, and this is a marriage issue. But you can just hear your voice. You can just hear how stressed out you are.

[Jade Warshaw]

Yeah. Take a deep breath. I need to take a deep breath after hearing that, because, I mean, you're transferring that feeling. We feel it. My chest got tight just listening to you.

[Ken Coleman]

That's right.

[Jade Warshaw]

The good news. Let's start with the good news. The good news is you've got a job.

[Caller]

Yes.

[Jade Warshaw]

The good news is you at least have the information surrounding what's going on with these kids. Health. Okay. So it's good to know. So you can know what you can do next. Let's talk about what's happened since you've emptied out the Roth. What's done is done. You can't go back. It's spilled milk. You know, you kind of have to just move on from that. You've emptied out your emergency fund. Good news is that's what the emergency fund is there for. It's there for when it rains and pours. Okay. So let's look at things as they are now and give me a sense of what. What it is that you're trying to accomplish. Like, if I said to you, Alyssa, what's next on your. What's most important on your things to do right now? Give me the top three.

[Caller]

Our credit cards are crumbling. They're. They're crippling. They're completely crippling. Our cars paid off. We rent. So, you know, the rent. The rent's getting paid. The credit cards are getting paid, but barely. And then a lot of the issue really kind of stemmed from my. We had. There's so many credit cards. I had a lot going into them. We've been married for eight years. I had a lot going into the marriage. And then just time goes by, things get worse.

[Jade Warshaw]

How much credit card debt do you.

[Caller]

Have between the two of us? I think it's around 80.

[Jade Warshaw]

Okay, 80,000. But you said your cars are paid off, which is good. What other debt do you have?

[J]

Student loans.

[Caller]

I think between the two of us, we have 130 in student loans.

[Jade Warshaw]

Okay, are you making active payments or is it a super low payment right now?

[Caller]

He's making payments. I'm not making payments right now.

[Jade Warshaw]

Okay, what? Do you know how much he's spending on payments every month?

[Caller]

340, I think. It's not a lot. He's really paying minimally.

[Jade Warshaw]

Okay, tell me what you guys are bringing in. And I know, let's say it like this. What's at your disposal income wise, every month? Like, what are you bringing in? And I don't know what's going on with your husband, but if you feel like you can include that or can't include that in this equation.

[Caller]

No, no, no, no, no, no. It's, it's fine. He brings home. I think it's like take home. I think it's 15 every two weeks.

[Jade Warshaw]

Okay, so 3,000amonth, new job I just got.

[Caller]

It's a little bit, it's less. So I want to say probably like 24, 2400amonth.

[Ken Coleman]

What does he do for a living?

[Caller]

He's a meteorologist.

[Ken Coleman]

Oh, he's on air?

[Caller]

No, he's on air. It's complicated. He works for a company where they like forecast for like cruising cargo ships and stuff like that. So it's, it's kind of like private type of thing.

[Jade Warshaw]

And how much is your rent? How much you guys paying in rent every month?

[Caller]

We're only paying 1650 for a small house.

[Jade Warshaw]

Okay, 1650, you said only. But the truth is it's only 25% is over. 25% of your take home. So you probably are feeling it. Um, it's not much over, but it's 350 over. So you're, you're feeling that a little bit. Okay. What's on fire here is I think you're just, I think you've experienced so much in a very little bit of time and it's still like reverberating in your day to day life. But a lot of it is, it feels like based off what you've said, it feels like a lot of it has kind of started to settle. Is that fair enough? Like all this craziness happened and now the ash is settling and we're going. Okay, and you're kind of like surveying, like, where do we go next? You've got the job. You guys are making 5,400amonth, which is not, you know, it's not a bad place to start. I think that's, that's good. You've got $80,000 in debt and then 130 in student loan debt. So that's probably what you're feeling right now. But it's not because of the payment, because you're not paying on all of that. So it's just that idea of the debt resting on your shoulders. So let's break it into small pieces because I think right now that's what you need to do. If I were you, it's the debt snowball on these, snow on these credit cards. Are they current? Are they in collections? Tell us more.

[Caller]

They're all current. The big problem was my, my husband had them on auto pay and he doesn't, he doesn't check them. So I guess there was a month where it didn't go through. And then it's, you know, it does that thing where it's, you're not getting a payment so it adds.

And ads.

And ads.

[Jade Warshaw]

Okay, so what paying attention, what you can do is there. It tends sometimes in relationships there's people that are better at handling money than others. Everybody needs to be involved. But it might be for you to be the one that actually monitors that and pushes play on it. And it sounds like it's going to be that I want you to be on top of this and try to drag your husband in to get on top of this as well. But Ken Coleman, they probably need to go into some counseling.

[Ken Coleman]

I think they got to scrape some money together. And you guys need a marital counselor so that a mediator can show him how you're feeling and he's got to wake up. This is the Ramsey Show.

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[Ken Coleman]

Solutions is a paid non client promoter of participating pros. Learn [e-mail] SmartVestor welcome back to the Ramsey Show. I'm Ken Coleman alongside my friend Jade Warshaw. We're so excited to be together for you today. Triple 8, 8255-2258-8825-5225. All right, let's go to Salt Lake City, Utah and Haley is joining us. Haley, how can we help?

[J]

Hi, guys. Thanks so much for taking my call.

[Ken Coleman]

You bet. What's up?

[J]

Yeah, so to give you some context, me and my husband just got married last May, and since then we've been able to pay off his $15,000 car loan. We purchased a house and saved up a six month emergency fund.

[Jade Warshaw]

Nice.

[J]

Yeah. So my question is, we bought the house knowing it would need a kitchen renovation. I thought I could last a little longer with the current kitchen, but it's literally falling apart.

[Ken Coleman]

What's going on in my kitchen? Yeah, well, she says it's falling apart, so. So, Haley, talk to us. Paint us a picture of this kitchen.

[J]

Yeah. So our house is 100 years old and yeah, it's awesome. But the kitchen probably is from like the 1940s, 50s. The flooring, I can see the baseboards. To give you some context, the floor is crumbling, the sink is caving into the, to the the counters. And this is more of a luxury. I guess you could put this. But it doesn't have a dishwasher. The electrical is outdated. It's actually not up to code.

[Jade Warshaw]

So that's dangerous.

[Ken Coleman]

Yeah, but you falling through the floor is not a good idea. And feels like the sink is about ready to turn into a massive plumbing expense Fair.

[J]

Yeah. So. So it's functional. But yeah, it definitely needs to be updated. And we knew that. But. So we're wondering if we should one, suck it up, save another year to cash flow the renovation, two, take from our emergency fund, or three, get a renovation loan with a zero percent financing.

[Ken Coleman]

No, no, no. You knew Better. So three's off the table. You knew that, Haley, right?

[J]

Yes, to an extent.

[Ken Coleman]

Okay, so let's go back to one. Let's go to option one. Suck it up and save for a year. How much are you anticipating that this. That the reno would cost?

[J]

We're thinking it will, like, on the low end, it would probably be around 20k.

[Jade Warshaw]

Okay.

[Ken Coleman]

Okay. And how much do you have saved towards that? Right now, we're not talking your actual emergency fund. Do you have any other savings?

[J]

Yeah, we have probably, like, outside of our emergency fund, about 8,000.

[Ken Coleman]

That's awesome.

[Jade Warshaw]

That's good.

[Ken Coleman]

You're not going to like this answer, Haley, but I would. I would absolutely. The two of you go, okay, what's it going to take for us to come up with another $12,000? And how fast can we do that? And I would be so motivated by that floor and that sink. I would be selling stuff. I would be doing everything that I could do to come up with that 12 grand. And to be completely honest with you, I would. I would. Cash flow as you go. And what I mean by that is, if this were my house and you were my wife and I was your hubs, I'd be going, I gotta fix the floor first.

[Jade Warshaw]

Yeah.

[Ken Coleman]

Like, she. We can't fall through. So. Okay, what is it going to take to fix the floor? All right, and then I'm making this up, Haley. But let's say the. Do you have any idea? If you have you a line item that out, what's the floor gonna take?

[J]

We've done some quotes before. Unfortunately, the floor that. I've thought the same thing before. It has to, unfortunately, be like the very last.

[Jade Warshaw]

It has to be. That's what I was thinking.

[Ken Coleman]

Oh, is that right?

[Jade Warshaw]

Yeah.

[Ken Coleman]

All right.

[Jade Warshaw]

Never mind so much if you're changing the footprint.

[Ken Coleman]

Well, what about the sink? That's literally falling into something. What is it going to cost to fix that?

[J]

That would probably be the most expensive part is like the cab, you know, getting new cabinets. And, you know, do you have to say new cabinets?

[Jade Warshaw]

Do you have to get new cabinets? Or you can. Can you reface the old ones? That's what I'm doing.

[J]

We have to get new cabinets because they're not. Basically, we have to redo the electrical, and the sink is taking up all of the counter space because we don't have a dishwasher.

[Jade Warshaw]

It's like a really old. So you're changing. You're changing. Earthing.

[J]

Yeah, it basically. I mean, to an extent, it kind of has to be Gutted.

[Jade Warshaw]

Listen, the thing I'm most scared about is the electrical because I'm like, how are you only going to, I mean, I'm an electrician, but if you tell me the electricity is 100 years old or at the very least from the 40s, how can you only fix it in the kitchen and not fix it in the rest of the house? Like, I'm afraid I can't imagine opening a 100 year wall and it only being that there being no problems. So part of me is like I.

[Ken Coleman]

Was trying to get her to pay for an appetizer, save up for the entree. She's like, nope, we got to have a five course.

[Jade Warshaw]

Does your husband know how to do work?

[Ken Coleman]

Does my husband know electrical, any of this stuff?

[J]

Oh, does he know, Sorry, repeat the questions.

[Jade Warshaw]

Know how to do stuff in your kitchen?

[J]

Oh, we, we've, we've thrown out the idea of doing stuff ourselves to save money and I think there's some things we can do. But like I also don't want my husband to get electrocuted, you know, 100%.

[Alyssa]

He has.

[Ken Coleman]

Well, again, yeah. Haley, listen, back to the point I'm trying to make. Do you disagree with this, Jade? I think they, they just really hustle and come up with 12 grand.

[Jade Warshaw]

I think you need to come up with this money, but I think every plan needs to have a contingency. And in this case, I would be afraid for you to start knocking walls with only $20,000.

[Ken Coleman]

I, I don't know how you're doing it. On 20.

[Jade Warshaw]

Yeah, I, I, unless this thing is a teeny tiny space, I don't know how you're doing it either. I want you to treat this like I want you to treat this home budget, this home rental budget as though, I don't know, somebody prominent has hired you to do their. But like you, you can't play around.

[Ken Coleman]

With like Martha Stewart's hired you.

[Jade Warshaw]

Yeah, man, like you need to go through detail and really make sure you know your numbers on this. Really make sure you've priced things out and gotten accurate because you can't. I've lived in a 100 year old house. You can't mess around, you can't mess around with it. And $20,000 feels light. I'm not gonna lie. Try to get that number up.

[Ken Coleman]

Don't finance it because then you're gonna be stressed out over it. I would try to live around it and make that your motivation.

[Jade Warshaw]

Yeah, that's, you guys are saving every penny. I'd love for you to have like, 30 to $40,000 to start this. Like, just in case. Like, this is the type of thing you open up the wall and then you find out there's mold everywhere. Or you open up the wall and you find out there's asbestos. Like, what are you trying to do? I'm only going off of what I saw on hgtv.

[Ken Coleman]

You're trying to depress her. No, but trying to help her.

[Jade Warshaw]

I've seen enough of these home shows. Homes on home.

[J]

I totally.

[Ken Coleman]

Yeah, you're right. I totally know what you're talking about. Oh, she's so happy with herself. She's. She's watched a lot of hgtv, watch.

[Jade Warshaw]

A lot of tv.

[Ken Coleman]

She's watched a lot of HTTP but yeah, yeah. Don't finance it. And the reason is, is I. I know where you're coming with this because you, you were going like this. Well, look, it's our kitchen. I mean, it's the house we live in and.

[Jade Warshaw]

But you knew that getting into it.

[Ken Coleman]

Yeah, and the finance charge on this adds to the stress. Just avoid this at all cost. Get really innovative. Let me tell you something. I've read a lot of books on innovation, and I'm going to steal something from innovation to give to you, Haley. And I hope it becomes inspiration.

[Jade Warshaw]

As long as it rhymes. Come on, Ken.

[Ken Coleman]

Innovation to inspiration. I knew it. I know. Don't make me do this. Here's. Here's what we know about the great innovators. They innovated. They created something because of a lack of resources. It was the lack of resources, tools, elements, whatever, that led them down the process of what we call innovation. And innovation happens best. And most. This is a fact when we are limited and we have to then dive deeper into our imagination. And I really believe that if you treat this kitchen project like that, like, we ain't got 20,000, we ain't got it. We ain't got 50,000, you ain't got it. We got a problem that we gotta solve. How many different ways can we solve this? And next thing you know, you've got an episode of MacGyver.

[Jade Warshaw]

That's right, Ken. You're exactly right. We find it time and time again when people walk the baby steps, when we say, hey, you're. You now are cutting up credit cards and you have a thousand dollar emergency fund. Right. It causes you to think differently. Necessity is a mother of invention. And you start to go, okay, what can I do to make this work? You start looking for other options. Because we know, Ken, that when people utilize debt A, you don't have to be creative anymore. No, you can just spend and spend and you tend to spend more.

[Ken Coleman]

Slap some plastic on it and that doesn't fix anything. So I really would challenge you. I think you two can figure this out. And I think on the other side of this, it's going to be less stress, better marriage, better kitchen. This is the Ramsey Show.

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[Jade Warshaw]

Ramsey hey guys, what's up? It's Jade. Look, let's be real. With everything that's been going on, staying on track with your money gets tough between bills, trying to pay off debt, saving money. Honestly, it's a lot and I've been there. That's why I'm excited to tell you that Dave Ramsey and I are hosting a free live stream on January 23rd to help you take control of your money in 2025. Plus, Rachel Cruz and George Camel are also going to join us for a live Q A where you can finally get your money questions answered on the spot. And check this out. You could win $4,000 in cash. It's a giveaway. Imagine what you could do with all that money. All you've got to do to enter the giveaway is to sign up for the live stream. That's it. So go to ramseysolutions.com livestream and sign up today.

[Ken Coleman]

Welcome back to the Ramsey show alongside my friend Jade Warshaw and Ken Coleman, triple 882-55-5225 is the phone number for your call today. You don't want to miss our two night virtual event with Dave Ramsey and George Campbell. It's called Investing Essentials. We did this last year and it was just a huge success. People want to know about how we teach people to invest because it's overwhelming and confusing, to be quite frank, and you can't figure it out in a 60 second reel. But at our virtual event, we're going to walk you through maximizing your 401k mutual funds. You get the most out of your money. It's the only place to get Dave's personal playbook on real estate investing. And he'll explain how he's made hundreds of millions of dollars in property investments. You can get clarity, which will give you confidence to invest and build wealth. This is March 4 and 5. It's two night event virtual so you can watch it from home. Tickets started $199, 199 on March 4 and 5. Get your ticket today at ramseysolutions.com events or you can click the link in the Show Notes. Have I talked about the Show Notes yet today? No, I'm going to talk about the Show Notes.

[Jade Warshaw]

Tell us.

[Ken Coleman]

If we ever talk about stuff and we talk about stuff, we know you all are moving around. You're on the exercise bike right now, or I don't know, some of you are on a snow plow, I don't know. And you hear something, you go, oh, I can't remember what the URL was. Some of you don't even know what a URL is. Just go to the Show Notes. If you're watching on YouTube, it's right there in the comments, right there below the video window. And your favorite podcast app, the Show Notes Jade. It's a treasure trove.

[Jade Warshaw]

It is a treasure trove.

[Ken Coleman]

All right. That's all I want people to know because I'm that person. What'd he say? And Stacy's like, what'd you say anymore? What'd you say? And we're like, we don't even know what we're saying.

[Jade Warshaw]

Click the link in the show notes.

[Ken Coleman]

Don't, don't all the links. That's all I wanted to say. It's a psa.

[Jade Warshaw]

Yeah. Good.

[Ken Coleman]

All right, let's go to Green Bay. Was. Oh, this is exciting because, you know, years ago, Dave wrote, not too long ago, Baby Steps Millionaires love it. And from time to time, we have fun when Baby Steps Millionaires call the show and tell us their story. So we've got Alyssa, who is waiting in Green Bay, Wisconsin. Alyssa, you're on the Ramsey Show. How can we help?

[Alyssa]

Hey, guys, thanks so much for having me on the show.

[Ken Coleman]

So you're a baby stuff millionaire?

[Alyssa]

I am.

[Ken Coleman]

Oh, my goodness, you sound young.

[Alyssa]

Oh, I think I'm young. Thank you, Jade. I'm 34.

[Jade Warshaw]

Oh, my.

[Ken Coleman]

You really. Let me. Let me just say, Alyssa, It's a baby. 34 is young. I don't care what anybody tells you, that's young.

[Jade Warshaw]

I'm telling you, it's young.

[Ken Coleman]

Yes. Facts. Well, that's very exciting. Okay, so tell us your network net worth.

[Alyssa]

So it's just over a million? About a million and twenty thousand.

[Ken Coleman]

Oh, okay, nice.

[Jade Warshaw]

That's awesome.

[Ken Coleman]

And how long ago did you crack the 1 million mark?

[Alyssa]

It happened this fall. And then there are some ups and downs in there, certainly with the market. But.

[Ken Coleman]

All right, give us. Give us the mix of what. What is making up the 1 million net worth?

[Alyssa]

Okay, so in investments, so that's regular IRAs, Roth IRAs, 401ks, and our HSA, we have 430,000. And our 529. For our four children, we have 42,000. We have about 480,000 in equity in our home, which will be paid off here soon. And about $68,000 in cash.

[Jade Warshaw]

Nice.

[Ken Coleman]

All right, so I love this. I mean, just hitting that 1 million mark. And I love how it's spread out. This is real everyday people.

[Jade Warshaw]

Yeah.

[Ken Coleman]

Are you actually in Green Bay or in surrounding areas?

[Alyssa]

Surrounding areas. APPLETON, which is 25 minutes.

[Ken Coleman]

Yeah, yeah, yeah. Okay, gotcha.

[Jade Warshaw]

I love this because a lot of people think a network, like when people say, oh, I'm a millionaire, or this person has a million dollar net worth, Alyssa. They think it's. They. They earned a million dollars or they made a million dollars in a year. And people forget that your home equity is part of that. Right. Like for you, it's cash savings. You're 529. Your retirement. I just love this picture. It is. It makes it feel so accomplishable.

[Ken Coleman]

Well, you notice none of it's inherited at all. You've just been building it up. And at a very young age, as we like to point out. What's it. What's the income?

[Alyssa]

Household income, 2024, we topped out at about $300,000.

[Ken Coleman]

Very nice.

[Jade Warshaw]

Where'd you start?

[Alyssa]

We were married in 2013 and we started around 125.

[Jade Warshaw]

Nice household.

[Ken Coleman]

That's a good start.

[Jade Warshaw]

What do you guys do?

[Alyssa]

Yeah, my husband's a high school teacher slash Some like administrative duties and I am a pa A physician assistant.

[Jade Warshaw]

Wow.

[Ken Coleman]

Very processed people.

[Emily]

Interesting.

[Ken Coleman]

And GPA in college for both of you.

[Alyssa]

Oh my goodness. My undergrad I was probably pretty good like a 3.7. And then in grad school, closer to like a 3.0. Just tough.

[Ken Coleman]

Good for you.

[Alyssa]

My husband probably did better than me. He was probably closer to like a 4.0 in his.

[Ken Coleman]

I don't like people.

[Jade Warshaw]

How much, how much did like having a plan for your money, having a budget for your money, how much do you feel like that played into you guys being able to accomplish this?

[Alyssa]

It was everything. Jade. Honestly, I, I will go back and say like we got. Someone gave us the total money makeover, we got married and I like looked at the book and said like, oh, this is not us. I was like one of those classic people who didn't think like school debt was real debt. I was just like, oh, that's good debt. And then I picked it up a few years later and that's when everything changed. Just being intentional because we were never bad with money. We were never like super reckless or anything, but we were just super intentional. And now for the last probably five years, we have our every dollar budget that we're always looking at. And I think one thing I wanted people to really know from this call was we don't like, we don't live in a cave either. Like we don't. I know Dave always talks about like, were you like collecting winds and dust in a cave? No, like we have a budget but we have a healthy income and we still get to do really like fun things and save and pay off our house. So yes, we were like very aggressive with some things, but we've also been super intentional and definitely the budget and the program and just being, being motivated by things bigger than us was a big part of our story for sure.

[Jade Warshaw]

And I love it sounds like you're still working to pay the house off. So I love the idea that you're a baby steps millionaire. It doesn't again, it doesn't mean that your house is paid off and you're living in a million dollar mansion. Like this can look a lot of different ways. In each of those ways is extremely, extremely successful and aspirational.

[Ken Coleman]

Very, very good, very cool. And you really be you. I was going to ask you what advice would you give to somebody, that young couple like you, but I feel like you just gave the and telling us what you all did. But I would ask you told us what you did, but is there a mindset that you would describe for young couples that are listening or watching right now and hearing your story, and they're going, man, 34. They just crossed the millionaire line not too long ago. They started out at 22. What would you say about mindset?

[Alyssa]

Right. I think that's everything I would say start, you know, have. You're not going to reach a goal that you don't set. So I think having a goal is like, number one. And I think we always talked, my husband, I always talked about we have to understand as a couple what we want, not what. I mean, you can look at social media and you can even, like, talk to friends, and everyone's going to have their things. Right. So maybe you love going out to eat or you love vacationing. You can't love at all. I mean, you can, but you can't spend your money at it all.

[Jade Warshaw]

That's right.

[Emily]

Choose.

[Alyssa]

Choose what you're going to spend your money on. And then, you know, don't spend money on other stuff just because other people do. Like, we don't. We don't spend a lot of money on clothes. And I don't judge other people that do. We love to go on vacations.

[Jade Warshaw]

We love.

[Alyssa]

You know what I mean?

[Ken Coleman]

What kind of cars you guys drive?

[Alyssa]

Really crummy ones.

[Ken Coleman]

Really? How crummy are we talking about?

[Alyssa]

2013 Kia Sorento.

[Ken Coleman]

All right. That's not bad.

[Alyssa]

Like 130 miles. A thousand miles on it. And a 2016 Kia Sedona. That's my minivan.

[Jade Warshaw]

You are like, Sam and I, you guys are trying. I drive a 2013 Cadillac. I think he drives a 2016 Yukon. And the miles are about the same.

[Ken Coleman]

Yeah. And they're not crumbling.

[Alyssa]

And that's. Yeah, I know. They're perfectly fine for us.

[Jade Warshaw]

They're fine for us. Yeah. Fine for you.

[Alyssa]

Not flashy.

[Ken Coleman]

Good for you.

[Alyssa]

And they. They're worth probably less than $20,000 together. So.

[Ken Coleman]

Right.

[Jade Warshaw]

So what did you do that moment that you logged on to, you know, whatever your app is, that moment that you saw your real estate value and you. You kind of calculated it and realized, oh, my gosh, we made it. What did you do? How'd you celebrate?

[Alyssa]

I was like, whoa. So I talked to my husband, but then we actually have some best friends who are the same age as us, and it's like, she is my, like, Ramsey person that I talk to about all this stuff, and we have such a cool relationship that we can chat about that stuff. So I called her up. They had just reached the million dollar mark. So we went out for this amazing dinner together.

[Ken Coleman]

Fun.

[Alyssa]

And it was super fun.

[Ken Coleman]

Love it. Alyssa, thank you so much for calling and sharing your baby steps millionaire story. 34 years of age got started young couple at 22J.

[Jade Warshaw]

I love it.

[Ken Coleman]

Yeah, really fun.

[Jade Warshaw]

You got to have friends that you can share money wins with.

[Ken Coleman]

Darang, I hear you. You know, I like that. It's good advice. Hey, don't move. We'll be right back. This is the Ramsey Show.

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[Ken Coleman]

Welcome back to the Ramsey Show. I'm Ken Coleman. Jade Warshaw is alongside triple 8825-5225-8825-5225. Now, my partner and I here, we were talking earlier in the show and we talk all the time around the office about this inflation right in just there is a natural progression of inflation over time. The Fed, just a kind of a quick review here because, because Jake's got a little something to share here today. So teeing you up here because everybody's heard about the Fed. Jerome Powell unfortunately has become a name that everybody knows.

[Jade Warshaw]

Yeah.

[Ken Coleman]

And and to his credit, the Fed is attempting, sometimes I agree with them, sometimes I don't. But they are always attempting to keep inflation in that two, two and a half percent range or so. And when it gets above that, they start paying attention. And this is where we get the monetary policy and you all are paying attention to the headlines all the time when you see are they raising rates, are they dropping rates, all this kind of stuff. So it's always an interesting tension between wages, are wages going up, are they.

[Jade Warshaw]

Outpacing the outpacing inflation?

[Ken Coleman]

Very hard for that to happen over long term terms. So anyway, nonetheless, what do you got here? You got a little something for us?

[Jade Warshaw]

Well, I'm just trying to, I'm trying to make heads or tails of all of it. Right. Because it's like we knew in 2022 that inflation was going bananas. Like we felt it. The numbers were there. The, the data supported what we were feeling was true. But then we started to see inflation taper off and we saw wages start to jump ahead. But yet we were still saying, oh, it's so expensive out there, it's so crazy. And so my thought was like, okay, what's really happening? Because, you know, you're a guy that's following employment, you're following those numbers. And I'm looking at this graph here that I saw that really around March of 2023, a little earlier, wages really did start outpacing inflation at a decent rate. And I thought, okay, that means that we've got a little bit more margin back as American people, where is this money going? So I started looking around and you know, obviously we feel it at the grocery store. Like, that's the main place people say, oh my gosh, it's so expensive. And around about the time I was looking at this, I saw that NPR came out with a grocery study that basically said they followed the prices of groceries from 2019 until today. They went to Walmart and they picked, picked, I believe it was a hundred different items. And they said, we're going to track this over the course of six years, basically. And what they found is on average, out of those items that they tracked, 21 of the items actually got cheaper, 27 products got more expensive, and the rest of them basically stayed the same. And when you think about it, you're like, okay, that's interesting. That's not as much as I would have thought. Like, I'm thinking everything has gone crazy, everything's exploding. And so again, I'm like, okay, things have started to taper out. What's going on with this money? We're also seeing articles that are saying, like, people are spending more on their credit card than ever before, but at the same time, like, investments are doing better than ever, ever before. So the question is, is there margin and what are people doing with it? Is it true that wages are actually outpacing inflation? And from your point of view, what do you think about that?

[Ken Coleman]

Well, no, they're not and they can't. It's unsustainable. So for instance, if we look, if we look from a macro. So real big picture, you know, wages can't outpace inflation on the regular because it just gets to be too much. Like you just. So there's this give and take between wages. It kind of comes up and down. It's a bit of a roller coaster.

[Jade Warshaw]

So even if you see it at a moment, you're saying it doesn't generally last.

[Ken Coleman]

It does not. So you don't want to get into an apples for apples is what I'm saying. The conversation, this idea that, well, inflation over the last quarter was this. So wages should have done that. It's not how that works. You're looking at the total. This is kind of a complex conversation and I'm trying to keep it simple, keep it simple, but you know, you can't, you can't force on companies this idea. When you're in an inflationary period like we, we had been, if you go back about two years ago and inflation's really, really high, you cannot expect companies to go, well, because inflation is up here. I got to raise everybody's wages because that again, that drives more inflation.

[Jade Warshaw]

Right.

[Ken Coleman]

Because when they raise wages, they're raising their expenses, they pass those. So you got to be careful is my point. So this, this, this back and forth and trying to keep that. That's not what you want. What's interesting about this article, as you were talking, that I saw the reason why people feel and really see it at the grocery store. By the way, we saw this talked about in the media leading up to this last election.

[Jade Warshaw]

That's right.

[Ken Coleman]

You saw it on msnbc, you saw it on CNN and Fox. My point is it didn't matter what side of the aisle. Everybody was feeling the pinch on a lot of consumer goods. And this is what's interesting. If you look at 2019.

[Jade Warshaw]

Yeah.

[Ken Coleman]

So this is right before the pandemic, remember? Just kind of a quick history lesson. Because this is crazy. It doesn't seem like it was that long ago.

[Jade Warshaw]

No, it doesn't.

[Ken Coleman]

But here we sit almost five years. We're almost five years to the day. Not quite, but five years, a couple weeks when the pandemic really begins to hit. The U.S. march. March, yeah. That's when it started going bananas. But we now know it was at the Super Bowl.

[Jade Warshaw]

That's right.

[Ken Coleman]

In Miami, you know, nobody knew. All right, so here's the point. So if we're January 2025, if you go to December 2019, US prices cumulatively are up 23%. That's where people are feeling it. For instance, a four pound bag of Domino Sugar now costs $4.46. That's 74% more than 2019. Compared a dozen eggs, $4.90. That's 83% more Tide Liquid. I could keep going on and on why these are the staples. So when you're buying these every week, these aren't your splurges.

[Jade Warshaw]

Yeah, you feel it.

[Ken Coleman]

So that's interesting.

[Jade Warshaw]

So, well, this is. Then that's, that's. I mean, it goes back to our conversation earlier when we Were talking about the tariffs and new administration and that sort of thing. If we were feeling it before and it was because of other issues, you know, back then, right now they're saying the prices are up because of, you know, all sorts. It could be utilities and insurances for businesses to run. And so they're passing that on along to the consumer. It could be extreme weather. Right. With crops. And so because of that, that price is passing on to the consumer. But then if you add, I don't know, other things coming into this. So you're saying, basically what you're saying is, no, the consumer has every right to feel this and even if they have, it's real. Yeah.

[Ken Coleman]

So here's what's happened. You can't get all hung up in inflation costs per month because what happens is you have large spikes. So back to the quick timeline. This will be helpful for folks. We go into the pandemic, Jade starts in, let's call it 2020, early 2020, and the whole world shuts down. All right, so in that moment you did have multiple, let's call it storms converging for a massive, once in a generation, I hope, financial storm one, the scarcity. Because we had supply chains interrupted, the whole world shut down. For a while. Every state was different. Every country was like, what are we doing? Secondly, demand did increase a couple months in when people started going, okay, I'm at home, I'm working from home, but I got to have food. Remember we saw liquor stores, things. So here's what happened. This is interesting. So, so all of that comes into natural economic factors which makes demand higher and scarcity and that created an increase. Here's what this article says and it's absolutely right. Big. I'm reading from this article, big price increases are rarely followed by equally big price decreases.

[Jade Warshaw]

That's right.

[Ken Coleman]

Historic. Well, it's like that's what I want to tell everybody.

[Jade Warshaw]

They're not going to, it's not going to go back to what it was.

[Ken Coleman]

That's the key point. While the inflation rate has cooled, your four dollar sugar is here to stay.

[Jade Warshaw]

It's not leaving.

[Ken Coleman]

That's what's unfortunate.

[Jade Warshaw]

Well, that and that unless you get.

[Ken Coleman]

Into depressionary and very serious recessionary forces that can make those go down. But by and large, if we stay in a somewhat healthy economy, Jade, these prices are here to stay.

[Jade Warshaw]

Yeah, I mean it's got, like you said, it's gone up 25, but over the last year it's gone up less than 1%. So it's not still climbing that ridiculous rate.

[Ken Coleman]

Good news, bad news.

[Advertisement]

Yeah.

[Ken Coleman]

Good news is inflation, as we see it, has cooled. Bad news is companies don't just go, well, you know what? For the last five years, people have been paying $4.66 for this sugar, and we used to sell it for only $2. Let's go back.

[Jade Warshaw]

They're not gonna go back.

[Ken Coleman]

And so there comes in the evil capitalism cries and the rub between. And by the way, this is the tension that exists in America today.

[Jade Warshaw]

Absolutely.

[Ken Coleman]

Is People go, wait a second. You used to charge me this. Now you're charging me this.

[Jade Warshaw]

Come on, think about it.

[Ken Coleman]

So there's the tension.

[Jade Warshaw]

Sam and I went out to dinner, and, you know, everybody has the menus on the screen now that you do the qr, which I hate because it makes you get your phone out at dinner. Figured out. That was one of the things that they figured out. This is a lot cheaper for us.

[Ken Coleman]

Right.

[Jade Warshaw]

And we ain't going back.

[Ken Coleman]

Yeah. They're not going to print menus. You know what else they figured out? Go to the coffee shop in my neighborhood. Neighborhood. Sweet little gal, makes me a coffee, then turns the screen goes, would you like a tip? I feel like going, no, I just want my coffee. This is the Ramsey Show.