Don't Settle for Living Paycheck to Paycheck

Summary

Podcast Summary: "Don't Settle for Living Paycheck to Paycheck"

The Ramsey Show
Host: Dave Ramsey
Co-Host: Jade Warshaw
Release Date: July 24, 2025

In this episode of The Ramsey Show, Dave Ramsey and co-host Jade Warshaw address various callers grappling with financial hardships. The primary focus revolves around breaking the cycle of living paycheck to paycheck, managing debt, improving credit scores, and building a stable financial future. Below is a detailed summary of the key discussions, insights, and advice provided during the episode.

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1. Tom from New Jersey – Managing Multiple Mortgages and Job Loss ([00:42] - [07:43])

Caller’s Situation: Tom, a resident of New Jersey, reached out with a complex financial situation:

• Debt: Four mortgages, a car loan, and a credit card.
• Employment: Laid off for seven months; wife earns $130,000 annually.
• Assets: Attempts to sell rental properties, securing $45,000 from one sale.
• Savings: Emergency fund of $12,500.

Key Points & Advice:

• Assessing Real Estate Value: Ramsey emphasized the importance of understanding the true market value of properties.

  Dave Ramsey ([05:11]): "What is the stinking thing really worth?"

• Rejecting Bad Deals: Advised Tom to avoid offers that could jeopardize his financial standing, such as buyers attempting to transfer existing mortgages.

  Dave Ramsey ([07:43]): "The buyer that you have is not a real buyer. Run him off."

• Debt Risk Awareness: Highlighted the risks associated with excessive debt, especially when relying on rental income that may not be stable.

Notable Quote:

Dave Ramsey ([06:17]): "You have two issues. Number one, you've got to work on that issue. Number two, we've got to get a buyer. The buyer that you have is not a real buyer."

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2. Ren from Missouri – Credit Score Challenges Affecting Employment ([10:42] - [19:08])

Caller’s Situation: Ren, residing in Missouri, faced challenges with his credit score after paying off debts:

• Credit Impact: Paying off an old auto loan lowered his FICO score below 700.
• Employment Implications: His job as an IT professional for financial institutions tied his credit score to his employment status.
• Debt Status: Approximately $22,000 in consumer debt, excluding mortgage.

Key Points & Advice:

• FICO Score Misconceptions: Ramsey clarified that a FICO score primarily reflects one's relationship with debt, not overall financial responsibility or net worth.

  Dave Ramsey ([12:21]): "If you become debt free and your credit score drops below 700... these are people too stupid to work for."

• Challenging Employer Perceptions: Encouraged Ren to communicate directly with his employer to address misconceptions about his financial responsibility.

• Debt-Free Misinterpretation: Emphasized that being debt-free is a sign of financial health, countering the erroneous notion that it indicates financial irresponsibility.

Notable Quote:

Dave Ramsey ([12:21]): "If you become debt free and your credit score drops below 700 and stays there and they look at you and say you're debt free so you can't manage money. Well, these are people too stupid to work for."

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3. Tricia from Arkansas – Navigating Divorce and Student Loans ([22:45] - [31:35])

Caller’s Situation: Tricia, from Arkansas, sought advice post-divorce:

• Debt: $60,000 in student loans (including co-signed loans for her daughter) and $25,000 on a car.
• Savings: $38,000 in money market savings with an emergency fund of $3,000.
• Income: Teacher salary increasing to $52,400 with additional side income.
• Recent Changes: Refinanced a car loan to reduce payments; divorced after 22 years of marriage.

Key Points & Advice:

• Following the Baby Steps: Ramsey guided Tricia through the seven baby steps, emphasizing debt repayment, building a sufficient emergency fund, and investing for retirement.

  Dave Ramsey ([29:37]): "You'd have a half a million dollars if you invest 15% of your income."

• Emergency Fund Allocation: Advised reallocating her savings to establish a robust emergency fund.

  Dave Ramsey ([29:10]): "So now I've got $16,000 that I can earmark into a money market account as an emergency fund which is adequate for you."

• Debt Repayment Strategy: Encouraged prioritizing paying off the car loan and managing student loans effectively.

Notable Quote:

Dave Ramsey ([29:45]): "Note that your wife is going to feel a whole lot better and you're not. You're going to get a will, you're going to get a life insurance policy and you're going to sell your truck."

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4. Kiko from Tacoma – Single Parenting and Mental Health ([31:35] - [40:00])

Caller’s Situation: Kiko, a single father in Tacoma, faced:

• Debt: Initially $22,000, reduced to $3,000.
• Mental Health: Struggles with ADHD, PTSD, anxiety, and depression.
• Employment: Academic advisor and part-time college professor.
• Income: $4,000 monthly from salary and $2,400 from VA disability.

Key Points & Advice:

• Budgeting with EveryDollar App: Jade Warshaw introduced the EveryDollar app as a tool for budgeting and managing finances systematically.

  Jade Warshaw ([37:23]): "It's getting a lot done for you. It's getting out of debt, it's getting you an emergency fund."

• Prioritizing Debt Repayment: Encouraged paying off the car loan to eliminate high-interest debt, thereby freeing up funds for savings and investments.

  Dave Ramsey ([29:37]): "You'd have a half a million dollars if you invest 15% of your income."

• Mental Health Support: Acknowledged the emotional burden of debt and stressed the importance of mental well-being alongside financial management.

Notable Quote:

Jade Warshaw ([38:13]): "Finding out what your deductible or out of pocket max is. Sometimes it's the same number, sometimes it's different."

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5. Ashley from Columbus, Ohio – High Net Worth but Illiquid Assets ([44:51] - [53:34])

Caller’s Situation: Ashley, based in Columbus, Ohio, with substantial wealth but limited liquidity:

• Net Worth: $40 million, with $30 million invested in her husband's business valued at nearly $1 billion.
• Income: $400,000 annually from the business; considering a HELOC on a fully paid vacation property.
• Concerns: Inability to access invested funds due to business structure and board decisions.

Key Points & Advice:

• Questioning Financial Advisor’s Advice: Ramsey criticized the suggestion to borrow against an already fully paid property, deeming it financially irresponsible.

  Dave Ramsey ([47:07]): "There's no possible way that borrowing on your lake house is a good idea when you have $40 million."

• Divestment Recommendation: Advised Ashley to divest from the business to gain liquidity and better control over her finances.

  Dave Ramsey ([50:07]): "I do completely want to divest. Absolutely. Because you are going to lose your butt."

• Lifestyle Adjustment: Stressed the importance of living within means despite having a high net worth, avoiding unnecessary debts to sustain financial stability.

Notable Quote:

Dave Ramsey ([50:40]): "Live within your means. Now, then we. How do we adjust our means? Well, one is we gotta have a discussion with these partners about, how about my $30 million?"

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6. Ron from Honolulu – Financial Preparedness During Health Crisis ([86:02] - [94:18])

Caller’s Situation: Ron, an active-duty army officer in Honolulu, faced a cancer diagnosis:

• Health: Diagnosed with cancer; recently underwent surgery with hopeful prognosis.
• Assets: $750,000 invested across Roth IRAs and TSP; emergency fund under $30,000.
• Savings: $20,000 from selling his truck.
• Debt: Minimal, with life insurance and a will in place.

Key Points & Advice:

• Investment Strategy During Crisis: Ramsey advised Ron to invest the $20,000 lump sum into an S&P 500 index fund for long-term growth, emphasizing minimal impact on his family's financial security.

  Dave Ramsey ([89:10]): "I'll tell you what I would do with it. [...] I'd dump it into an S and P index fund and just throw it in the market."

• Reaffirming Financial Stability: Acknowledged Ron’s thorough financial planning, highlighting that his preparedness ensures his family's well-being regardless of his health outcome.

  Dave Ramsey ([91:27]): "And then, for what? You've got a decent income. And if you did that, you can claim, clean up a portion of this debt, over half of it, and then you would just plow through the rest of it, get your life back and then start rebuilding again."

Notable Quote:

Dave Ramsey ([89:10]): "The rest of the picture we've just been discovering since you called in and how wonderful a job you've done is what's going to take care of them."

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7. Additional Caller Highlights

Throughout the episode, Ramsey and Warshaw addressed multiple other callers dealing with diverse financial issues, such as:

• Jessica from Santa Barbara: Overpriced home listing and managing multiple debts.

  Dave Ramsey ([120:58]): "If I'm the buyer, if I'm the seller and I'm not desperate and I haven't overpriced the house... your husband, a former real estate agent who doesn't do anything."

• Shannon from California: Balancing investment strategies for a teenage son.

  Dave Ramsey ([108:31]): "It was me. And sometimes this is true. I would come in with a new scheme or a scam every week."

• Anna from Jacksonville, Florida: Overcoming homelessness and repossession.

  Dave Ramsey ([113:28]): "Audit your spending until you can live within your means."

Common Themes:

• Debt Management: Emphasizing the importance of eliminating high-interest debts and avoiding unnecessary loans.
• Emergency Fund: Building and maintaining an adequate emergency savings to cushion against unforeseen expenses.
• Budgeting Tools: Promoting the use of budgeting apps like EveryDollar to allocate funds effectively.
• Financial Responsibility: Challenging traditional metrics like FICO scores when they misrepresent one’s financial health.
• Emotional Well-being: Acknowledging the psychological impact of financial struggles and encouraging community and professional support.

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Conclusion

In "Don't Settle for Living Paycheck to Paycheck," Dave Ramsey and Jade Warshaw provided actionable advice tailored to each caller's unique financial situation. The overarching message centered on taking control of one’s finances through disciplined debt repayment, strategic savings, and informed investment decisions. Additionally, the episode highlighted the importance of viewing financial challenges holistically, considering both economic and emotional factors to achieve lasting financial peace.

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Notable Quotes:

1. Dave Ramsey ([05:11]): "What is the stinking thing really worth?"
2. Dave Ramsey ([12:21]): "If you become debt free and your credit score drops below 700... these are people too stupid to work for."
3. Jade Warshaw ([37:23]): "It's getting a lot done for you. It's getting out of debt, it's getting you an emergency fund."
4. Dave Ramsey ([47:07]): "There's no possible way that borrowing on your lake house is a good idea when you have $40 million."
5. Dave Ramsey ([89:10]): "The rest of the picture we've just been discovering since you called in and how wonderful a job you've done is what's going to take care of them."

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This episode serves as a comprehensive guide for listeners seeking to break free from financial instability, offering personalized solutions and reinforcing the principles of financial stewardship championed by Dave Ramsey and his team.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love, and create actual amazing relationships. I'm Dave Ramsey, your host. Jade Washall, number one best selling author, Ramsey MZ personality is my co host today. The phone number is 888-25-5225. Tom is in New Jersey. Hey Tom, how are you?

[Caller]

Hey Dave, how are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

I can't believe this. I'm a huge fan. Unfortunately, I found your stuff a little too late and I have quite the financial mess.

[Dave Ramsey]

Okay, tell me about it.

[Caller]

So I have four mortgages, a car loan and one credit card. And I started listening to your stuff. I was working. I was, me and my wife, we were building an emergency fund. And I have been trying to get rid of these rental properties for some time now. And I've made some leaps and strides in the last few months. And my question is pertaining to the remainder of our money, our savings. My wife is still currently working and she brings in 130,000. I am not working. I have been laid off for seven months. I have been looking tirelessly for work. I had unemployment and I that had ran out. I recently have just signed up with Uber and I've been doing that. But compared to my previous income, it isn't too great.

[Dave Ramsey]

What did you used to do?

[Caller]

130.

[Dave Ramsey]

Oh, wow. You used to make 130 doing what?

[Caller]

Credit risk, commercial real estate.

[Dave Ramsey]

Okay. And why were you laid off?

[Caller]

$2 billion in defaults, billion dollars of debt. Assets were sold off to another asset management firm and the position was eliminated. And given the current interest rate environment, a lot of people are skittish to hire specifically for commercial real estate.

[Dave Ramsey]

Credit risk underwriting wouldn't disagree with that. But the skills that you use to do that are still usable in other things. So that nuanced job position is probably gone for a while. I would agree with you on that. But you've learned to do financial analysis and risk analysis, and that can be applied to a myriad of different things. So you need to broaden your search.

[Caller]

I'm closing in on one and I'm very optimistic. And it is a pay bump, but I'm not, you know, counting on it. You know, it's not in good hands yet.

[Dave Ramsey]

All right, so we got, we're working on your income. And so what. How can we best help you today?

[Jade Warshaw]

Tell us about the four mortgages.

[Caller]

So I have my primary, 540 at 5.75 payments. 4400. I have a rental property with 453 at 6. 6.5% payment. TNI is 2956, not including insurance, not including taxes. I have another one at 192 P&I is 1019. And then I have another one with a business partner which is at 11 and a half percent, and that is 184, which yesterday, I am hoping that we are closing. Someone is purchasing a cash.

[Jade Warshaw]

Okay, and what will you take from that?

[Caller]

45,000.

[Dave Ramsey]

Okay, but you're out with the cheese. Let me out of the trap. Okay? I mean, and so the other two are up for sale.

[Caller]

So the other two are up for sale. The one that's up for sale, I've dropped the price from 340 to 295,000. My one question is, do I continue dropping the price until I get an offer?

[Jade Warshaw]

Is that property number three?

[Dave Ramsey]

No, you just said. I said there's two left, and you said the one that's up for sale. Why are they not both up for sale? Everything is up for sale, okay, except your home.

[Caller]

Except my primary, which we're considering also putting up for sale.

[Dave Ramsey]

Is your car up for sale?

[Caller]

The car is going up for sale.

[Dave Ramsey]

Good. Okay, good. So we're cleaning this out. All right. I don't know. I mean, you've got to assess the real estate market there as to what's going on. Okay. Is the market simply slow or are you overpriced?

[Caller]

There is a significant depreciation in one of the properties, which is the one I have the specific question about to use the remainder of our savings to get out of that property.

[Dave Ramsey]

The question I want to know is what is the stinking thing really worth? What is the actual market value? What is someone going to walk up and pay for this house today? Not what have you got in it? Not what do you wish would happen. But if you were going to put this thing on the market and you were not standing in the forest, instead you were outside looking at the trees, what is it actually freaking worth?

[Caller]

475,000.

[Dave Ramsey]

All right, and what have you got on the market for?

[Caller]

I have it listed for 4. 95.

[Dave Ramsey]

Okay. All right, well, if it's actually worth 475, that may be a bump high, but it's not enough high to keep somebody from coming and giving you a market value offer. So how long has it been on the market for? 475.

[Caller]

The problem is. So this is kind of a unique situation. Someone has offered to purchase it and give me $20,000. I'm two months behind on that payment and I owe the property taxes. The conditions for them to come through with that are to be current with that mortgage and to be up to date on those property taxes and the $20,000.

[Dave Ramsey]

I'm sorry, they're going to take over your mortgage.

[Caller]

Sorry, can you repeat that?

[Dave Ramsey]

You drop. You throw your phone out the window. I'm sorry, what happened? They can't take over your mortgage, honey.

[Caller]

They service it.

[Dave Ramsey]

No, they can't do that. How does a real estate guy not know this? Okay, that mortgage that you have has a due on sale clause. You transfer title, they're going to call the loan.

[Caller]

I'm not going to be off the title.

[Dave Ramsey]

I know, but if you transfer title in form, even though you didn't move. So you haven't really sold the house, you just lease, purchased it to someone. No, thank you. No, thank you. I'll pass. Don't do that. That's a bad deal. A. If any of the insurance or anything else, any of the tax notifications, anything, gets transferred out of your name and the mortgage company notices that, they're going to say you have transferred in form even though you haven't moved the title and they're still going to call loan. Read paragraph 17 of your Fannie Mae deed of trust. You'll see what I'm talking about.

[Jade Warshaw]

How much are you. How. How much is the total of the months that you are behind in the property taxes? Because you were talking about dipping into your emergency fund to clear that.

[Caller]

I'm behind $6,000. They put a lender. A lender forced insurance policy on it, which is more than the other.

[Dave Ramsey]

Oh, yeah, Way more.

[Caller]

So for the two months, I owe 1,000 in insurance, which they build to a forced escrow account, and then 2956 for. In July's payment. You got.

[Dave Ramsey]

You have two issues. Number one, you've got to work on that issue. Number two, we've got to get a buyer. The buyer that you have is not a real buyer. Run him off. You're going to get in trouble here, man, because you're getting desperate.

[Jade Warshaw]

Yeah. What's in your emergency fund? Real quick?

[Caller]

12,500.

[Dave Ramsey]

Yeah. Okay. So. And so the lesson, Tom, is this, okay? The things that you were taught in academia and I was taught in academia about risk analysis on real estate does not include the risk that debt represents. And you are now experiencing the risk that debt represents wholesale. I mean, right across your face. You're getting slapped Repeatedly with the risk that debt represents. So you went into all these properties thinking there was no risk and the tenants were going to pay everything. And the tenants were always going to be there and they were always going to pay and they weren't going to tear up anything. There wasn't going to be repairs. And you found out that the more debt there is, the more risk there is. And you just took on a boatload of risk for no money. One property sells, you make 45,000, the other one sells, you get out, barely, you got no money and you traded all of that for risk. So now I hope you can get out of these and that's your goal. And I hope you get this job and that's your goal. Thanks for calling. These days, business as usual is anything but. Tariffs make trade policy a moving target. Supply chains are squeezed and cash flow is probably tighter than ever. So if your business can't adapt in real time, you're in a world of hurt. That's why you need NetSuite by Oracle, trusted by more than 42,000 businesses, including Ramsey Solutions. You need to see what's happening, what's stuck and what's costing you and how to fix it. And NetSuite is the number one cloud based business management suite because it helps your business make the right decisions fast. It brings accounting, financial management, inventory and HR into one place so you're not left shuffling a dozen different spreadsheets. That gives you the visibility you need to make quick decisions based on the actionable data. And NetSuite AI automates everyday tasks so your team can focus on strategy. It's one system for full control and no guesswork to tame the chaos. And right now, if you're leading a business doing more than a million dollars in annual revenue, download NetSuite's free ebook, Navigating Global Trade. Three insights for [e-mail] Ramsey that's NetSuite.com Ramsey. Rin is with us in Missouri. Hi, Wren. Welcome to the Ramsey Show. Hi. Hi. How can I help?

[Caller]

So I got a bit of a. Bit of a problem that I'm trying to figure out how to navigate. So I work in IT for a lot of different financial institutions and do a lot of security work for them and everything. And one of the things that's directly tied to my employment is unfortunately, my lovely credit score.

[Dave Ramsey]

No, it's not. Not Nati. It is if you're a president of a bank. But not Nati. They're not. They're not going to kill you for not having A credit score, they'll hurt you for having bad credit.

[Caller]

Right.

[Dave Ramsey]

But not no credit where. Right.

[Caller]

And that's the problem I'm running into is that I've got credit I've had credit for, you know, if I had good credit for quite a while. But I recently, with a lot of the contracts I've been doing, with all the work I've been doing, I've actually been able to get a lot of stuff paid down. And the unfortunate thing is one of my oldest accounts that had was actually an auto loan. And I paid it off here recently. And so I'm like, cool, got the car, paid off all great. And I go check my credit score and it dropped it below 700.

[Dave Ramsey]

Yeah.

[Caller]

I'm like, yeah, what the heck?

[Dave Ramsey]

Yeah, well, that's.

[Caller]

Right. But the problem is with the contract of my employment, it's actually because they put it in the form of, hey, if you can't manage your finances, then why do we give you access to other people's finances to manage the servers that handle it?

[Jade Warshaw]

How often do they check it?

[Caller]

Every six months.

[Jade Warshaw]

Okay. And how much debt do you have left to pay off.

[Caller]

Including mortgage and everything?

[Jade Warshaw]

No, not.

[Dave Ramsey]

Not right around.

[Jade Warshaw]

Not including your mortgage. Just your consumer debt. Just curious.

[Caller]

Oh, consumer debt. I've got about 22.

[Dave Ramsey]

Okay. If you become debt free and your credit score drops below 700 and stays there and they look at you and say you're debt free so you can't manage money. Well, these are people too stupid to work for. Seriously.

[Caller]

I agree that.

[Dave Ramsey]

Yeah. So I mean, they have to have. You have to look at whoever's using this and saying, listen, if you guys are so corporate and stupid that the only measure of financial wellness that you have is a FICO score, and I'm sitting here debt free with a strong net worth and no payments, and you're calling me not responsible. You're stupid.

[Jade Warshaw]

I know. That's right.

[Dave Ramsey]

That's just dumb.

[Caller]

Yeah. And that's what I've been trying to figure out is like, how do I tell them?

[Dave Ramsey]

Get on the phone with the goober, signing the contract and go, dude, if I am financially irresponsible, yes, fire me, but I have no debt that is not financially irresponsible. And that drives your credit score down.

[Caller]

Right.

[Dave Ramsey]

And if you can't look at me and say, debt free is financially responsible, then you're too dumb to hire me. Honestly. See, you've made the assumption that there's only one way to look at this by them. And I'm saying, when you get up in their grill, they're going to cave like a Walmart tent. Yeah, yeah, they are. And the one that doesn't. So what? Move on. I'm not going to pay interest to a bank and pay pay that I don't need to be paying to create an artificial wellness score that is not really a measure of wellness, but instead is a measure of how much I pay payments in order for some bureaucrat in corporate America who can't pull his head out of his butt to make a decision. No, don't live your life that way, man.

[Caller]

The only unfortunate thing is I actually really do like the work that I do.

[Dave Ramsey]

I'm not saying you're so freaking scared.

[Jade Warshaw]

Yeah, you're making a set of assumptions. You're making assumptions.

[Dave Ramsey]

You're not going to lose these accounts, man, when you go in and verbally accost them the way I'm describing and say, I am financially responsible, I'm out of debt. The reason my credit score went down is not because I didn't pay my bills, you dubers. It's because I don't have any debt.

[Jade Warshaw]

And you may not even have to accost them. You might could just explain it to him the same way that you figured it out as a smart human being. But don't, don't lie the same way they're going to figure it out. I've noticed that.

[Dave Ramsey]

Don't live with a glass half empty man. Go in there and sit down and talk to them. And you're the same guy that calls up and goes, I can't rent an apartment without a FICO score. But when you call 40 apartments, 38 of them will tell you they will rent you an apartment without a FICO score. So that's mythology that someone dreamed up and made everybody believe. So they keep borrowing money and staying in debt to the bank. Your other option, Ren, is just keep paying payments the rest of your life because you're too scared to talk to your employer about what real financial wellness is or your con. They're not even your employers.

[Jade Warshaw]

Yeah, that's a good point.

[Dave Ramsey]

Dadgum contracts.

[Jade Warshaw]

That's a good point. If you run it out the other way, as detailed as you've run it out the way, it not working for you. That means that you don't pay off the car, you never pay off your house.

[Dave Ramsey]

So you get to pay a bunch of interest for no reason. You know, $100,000 over the next 10 years to keep your FICO score working. Well, that's just dumb. But no, no. And guys this is the problem with the FICO score. If you don't know it was developed by an organization called Fair Isaac, you can look it up on their website. 100% of the elements in the algorithm that create a FICO score are about your relationship with debt. Have you taken out too much debt? Have you taken out weird debt? Have you not paid your debt on time? Have you paid off debt?

[Jade Warshaw]

The different types of debt, different kinds.

[Dave Ramsey]

Of debt that you have. Is it a credit card debt problem? Car debt issue? And so the only way you get a 700 to 800 credit score is you have paid hundreds of thousands of dollars over the scope of your life in interest to a bank. It's the only way the math works in the algorithm for you to have a FICO score. I can write you a check for $10 million. I'm not going to. But if I wrote you a check for $10 million and you put it in your bank account, your FICO score doesn't change one point. If your boss walks in and says, I'm going to give you a $10 million a year raise, your FICO score does not change one point. You get completely out of debt and build a million dollars in your 401k. It does not change your FICO score one point, except it will go down because you got out of debt. The FICO score is not a measure of financial responsibility. It is not except as it relates to debt. It is not a measure of financial wellness. It is not a way for you to keep score that you are doing well with your money. It is a way banks judge if you want to play kissy face with them or not. That's all it means. When they look down and they see an 800, they go yum yum, yum, yum, yum, yum, yum, yum, yum yum. Bring that one over here, sucker. That's what banks see. That's how they see it. They say they see 800, they go, sucker score. 800 sucker score. That's what they see. They see you've been buying a lot of stuff on credit. You like to pay interest. Come over and give us some of your money, sucker. That's what your FICO score means. It's a sucka score. That's it. Man, this is just nuts, y'.

[Caller]

All.

[Dave Ramsey]

It is not a measure of net worth. You go build a million dollar net worth, it does not affect your FICO score. You know what my Fico score is? 0. I don't have one. It's indeterminable. Which means I'm really off the grid. I must be financially irresponsible. I've got $600 million in paid for real estate. But I must be financially irresponsible. What a moronic, what a moronic thing. You know, this bank wouldn't hire me that he's talking about to work on their software because I'm financially irresponsible by their measure because the sucka score is too low. It's indeterminable. And you and Sam have the same problem sitting here. Just a couple of us, couple of losers sitting here answering questions.

[Jade Warshaw]

A couple of broke, irresponsible losers.

[Dave Ramsey]

This just pisses me off so bad because people walk around and I run into people at parties and they're just, they kind of know a little bit that we Ramsey does stuff with money or whatever, they don't know what. And they come over and go, you know, I got 800 FICO score. And I'm supposed to be nice when.

[Jade Warshaw]

They do or apparently impressed.

[Dave Ramsey]

Yeah, yeah. And I just go, yeah, I think it's perfect for you. You know, I just keep walking, right? Oh my God, you sucker. You just got screwed a lot. And often. So please guys, don't worship at the altar of the great fico. We bring you offerings of interest. Great fico. And you can give us anything we want on payments. It's a suck up play, man. It's how the banks have made their whole dadgum life. Oh, it's a wonderful program if you're a banker. If you're a person, it's horrible. Please don't worship at the altar of the great fat FICO.

[Caller]

Foreign.

[Dave Ramsey]

Hey you guys. Health insurance costs are only moving one.

[Caller]

Way and that way isn't down.

[Dave Ramsey]

And if higher costs aren't enough, the wait times to see your doctor are longer.

[Caller]

And it's harder than ever to get anything approved through the bureaucracy.

[Dave Ramsey]

So if you feel like the system.

[Caller]

Is working against you, try a biblically based alternative to health insurance. Christian Healthcare Ministries. CHM is a health cost sharing ministry that's helped hundreds of thousands of families.

[Dave Ramsey]

Like yours take care of over $11.

[Caller]

Billion in medical bills since 1981. CHM has also helped them stay true to their values and avoid miles of red tape. And CHM support goes far beyond meeting financial needs. They also help meet spiritual needs. Members become part of a family who will pray with them and for them when they experience a medical event.

[Dave Ramsey]

So listen, y', there's a better way.

[Jade Warshaw]

To take care of healthcare costs.

[Caller]

CHM programs start as low as $98 a month. So learn more today and [e-mail] budget that's chministries.org bud.

[Dave Ramsey]

If you're tired of living paycheck to paycheck and feeling like you can't get ahead, join one of our free everydollar trainings. There are new trainings every week this month and they're all hosted by one of our Ramsey personalities. Jade. You've done a couple of these, haven't you?

[Jade Warshaw]

I did one today and I did one on Monday.

[Dave Ramsey]

Oh, wow. There you go. So we're going to show you how to stick to a budget, even find $9,000 of margin using every dollar so you can get out of debt, build wealth, and there's a Q and A time that's live so you can ask questions. Probably a lot safer than you can on this show. Ramseysolutions.com webinar I bet the Q and A was good.

[Jade Warshaw]

Well, yeah, it was. And let me just say, because I have to say this, we've done a lot of webinars in the past and these are totally different. We're showing you completely new things. So if you thought you've seen an EveryDollar webinar, you need to log onto these because they're completely different. We're unveiling some things, Dave, is all I'm saying.

[Dave Ramsey]

Yeah, well, we've iterated on the app and it is doing things that it's never done before.

[Jade Warshaw]

Unbelievable.

[Dave Ramsey]

I saw some of the presentations yesterday. Some of the things that they're doing, it's very, very important.

[Jade Warshaw]

That's what I'm saying. You gotta get on.

[Dave Ramsey]

They're walking you through the baby steps and showing you exactly in detail what the next thing is.

[Jade Warshaw]

It's like if you had me or Dave in your pocket, it's to that level.

[Dave Ramsey]

So anyway, yeah, very cool. RamseySolutions.com webinar get signed up. It's completely free. Tricia is in Rogers, Arkansas. Hi, Trisha. How are you?

[Caller]

Good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

All right. So in 2022, October of 2022, my husband of 22 years decided he was done being married and he left and he divorced me in the process of all that. So he, his income was around 130 at the time. Mine was around 45. So I was very scared. He bought me a brand new car in September. So when he left in October, I took the car back to Nissan where it came from and I said, I'm Gonna this payment's 596. The math isn't mapping. I'm gonna have to have a cheaper payment somehow. Well, so they refinanced it. Basically I sold it to them and they sold it back to me used or something like that. It lowered the payment by about 50 bucks. And I was just trying to figure out how to cut expenses everywhere. Sold a house and so I had to pay. So this took up my whole. I'm a teacher at a private school. This took up that whole school year for me. At the end of it all I at the sale of the house, I had to give that X around 28,000. I had a substantially more. I think I had around 120 out of it. But I needed to pay. I had 60,000 in master's degree student loans that I had to pay for. And I had about 6 or 8,000, I think from my undergraduate degree which had included a 16,000 parent plus loan on it. So I paid those things off in the process of the expenses discovery and everything. I had forgotten that I was a co signer on the youngest daughter's student loans because she was a senior in college at the time. So it was kind of out of sight, out of mind. While she has since graduated and she's paying on her student loans. I'm the co signer so I can't like do anything. I've got 38,000 in money market savings. I've got 3,000 in just an emergency fund. My. We've had a lot of changes in education in Arkansas. So my salary starting this coming school year will be 52,4. And I have also taken on a second source of income that generates roughly for the 20,23 year. I had it brought in around 12,000 which you minus the 30% taxes out of that, whatever that would be. And I'm on track to make about 14,000 with it this year. But I'm wondering what.

[Dave Ramsey]

You're not in a 30% tax bracket, but go ahead.

[Caller]

Well, that's what. When I paid taxes, that's what the IRS charged me. They literally took 30% of that income.

[Dave Ramsey]

Yeah, well, you need to file your taxes properly. You'll get some of that.

[Jade Warshaw]

Not right there. How can we help today?

[Caller]

So I need to know what to do. So I had. So I spent my whole life raising kids, homeschooling them. So I have basically no retirement. I kind of started my own since all this happened. And I found out this coming school year my school is going to start a retirement for us. It's not a 401k. It's. I can't remember that. The letters and numbers.

[Dave Ramsey]

403.

[Jade Warshaw]

Does it do, Is it automatic or do you get a say in it?

[Caller]

I get a say in it. They match 3%. So we can opt in or not.

[Dave Ramsey]

And so I'm wondering, the bottom line is, is that you've had your heart broken and you've been drugged around behind a car for the last two years. So you're just raw, right? Okay. Other than that, your math is okay. Your math is going to be okay. You're going to get there okay. You're very analytical and that's how I know you're going to get there. You know all your numbers, we don't have to ask you what they are. You're just spitting them out. Just left and right. Even the ones in the past that don't matter anymore. So here's what we're going to do. We're going to walk you right up what we call the baby steps. Lots of 51 year olds making $50,000 a year, $75,000 a year with your extra income coming in, have become millionaires by the time they were 65 or 70. Lots of them. As a matter of fact, the number three most likely career in our millionaire study, we studied 10,000 millionaires. Number one was engineer. Number two was accountant. Number three was teacher. And the reason is, is that you're very process driven. And I'm going to give you the process. It's called the baby step. Baby step one is $1,000 in the bank. You've done that. Two is be debt free. Everything but your house. Now, how much debt do you have? That's not a house.

[Caller]

Well, I don't have the house anymore. We live in an apartment.

[Dave Ramsey]

Okay.

[Caller]

One of my daughters and I live in an apartment, but I have a car.

[Dave Ramsey]

Okay. How much is the debt on the car?

[Caller]

It's 25,000. The car is. I owe 25, it's worth 21.

[Dave Ramsey]

Okay. And it's a lot of car. That's that stupid car that was bought right before the divorce. Right?

[Caller]

Right. Yes.

[Dave Ramsey]

And you refinanced it and so you got screwed twice on it. Okay. Now the. And you've got how much in a money market account?

[Caller]

38,000 right now.

[Dave Ramsey]

And how much debt do you have other than the car and the living in the apartment?

[Caller]

None.

[Dave Ramsey]

Okay. This is going to be very scary for you because you've built up walls trying to survive the last two years. But. But if I woke up in your shoes, I would write a check Today and pay off the car. Now I'm debt free and I have 13,000 left in my money market. And how much was in the other account? 6,000?

[Caller]

3,000.

[Dave Ramsey]

3,000. Okay, so now I've got $16,000 that I can earmark into a money market account as an emergency fund which is adequate for you to have as an emergency fund. Then that's baby step three. Then baby step four is start putting 15% of your income away. If she puts 15% of 75,000 away from age 52 to age 65, what does she have?

[Jade Warshaw]

65. I have 70 in here. Oh yes, 74, 80,000. But I did that at your current income.

[Dave Ramsey]

You didn't do that with the extra income.

[Jade Warshaw]

I did that.

[Dave Ramsey]

64 at 64,000. Okay, so you'd have a half a million dollars if you invest 15% of your income. And that's with no match. But you told us you get a match.

[Caller]

Right?

[Dave Ramsey]

Okay, good.

[Caller]

3%.

[Dave Ramsey]

Yeah. So you're going to get that on top of that. So you're going to have 6 or $800,000 if you invest 15% of $64,000 and you never get a raise from age 52 to age 70. Okay, so you're okay. You're gonna be fine. But you're gonna have to continue to be very process driven, math driven, and let the facts talk to you. And the facts have done a good job talking to you in the midst of and trauma. You've remained fairly clear headed. Congratulations. It's very difficult what you've been through because you've been through hell.

[Caller]

Thank you.

[Dave Ramsey]

And then another thing I'm gonna do is I'm put kiddo that has the student loan on a tight budget. Make sure she gets a freaking job and she pays the bill. She's got to be responsible. She can't throw this back on you, right?

[Caller]

No, she's been doing great.

[Dave Ramsey]

I know she gets to keep doing great. And we're gonna put her on a beans and rice. Rice and beans? No, no. Run around Italy, get the freaking student loan paid off, kiddo, and then you can go have your life. But mom's on this thing and mom can't handle any more people dumping on her. Had enough dump on you lately? So you can fight through this. You can do it. Hang on. We're gonna put you in the EveryDollar app, the advanced version, as our gift, free to help you work your way through this. You can do this.

[Caller]

Switching banks can be a hassle and I totally get that. But when Winston and I opened up our Fairwinds account.

[Dave Ramsey]

We were shocked by how quick and easy it was.

[Caller]

It just took a few minutes online. We didn't have to block off an entire afternoon or track down paperwork. And the next day we got a personal call from a Fairwinds specialist just checking in. I couldn't believe it. When I answered my phone and I was talking to them, I was like, y' all are the nicest people. Now, if you're working hard to save.

[Dave Ramsey]

Money, get out of debt and build.

[Caller]

A future, you should have a bank.

[Dave Ramsey]

That supports that, not fights it.

[Caller]

That's why I recommend Fairwinds. They created these smart checking and savings bundles specifically for Ramsey fans. Plus they have a great app and.

[Dave Ramsey]

You have access to over 33,000 fee free ATMs and more than 5,000 shared.

[Caller]

Credit union branches across the country. So you can have access and withdraw your money just like you're used to.

[Dave Ramsey]

No matter where you live, don't settle for a bank that slows down your progress.

[Caller]

Make sure you choose one that helps build you up and helps you win with money. Visit Fairwinds.org Ramsey and open your smart bundle today. Fairwinds.org Ramsey Fairwinds dog Ramsay Fairwinds is federally insured by the NCUA.

[Dave Ramsey]

Are you staying on track with your baby steps? You can take a quick quiz to check your progress and receive a personalized plan just for you. That's kind of personalized means, right? Simply head over, show notes, click the link titled are you on track with the baby steps? Do the quick quiz and we'll help you with a personalized plan. Kiko is in Tacoma, Washington. Hi Kiko, how are you?

[Caller]

Hi Dave. Good, how are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Yeah, so I'm a 47 year old.

[Dave Ramsey]

Single dad, twice divorced both my marriages.

[Caller]

I let my ex wives handle my.

[Dave Ramsey]

Finances so I never really learned how to manage money myself or develop the necessary discipline.

[Caller]

And I'm just really embarrassed that I haven't given my kids the best example how to respect and manage money. Now I'm at a point in my life where I'm trying to rebuild, but I'm living check to check in debt. I'm also an army vet, so I struggle with not only childhood trauma, but adhd, ptsd, anxiety, depression, which make it all hard to stay focused and consistent.

[Dave Ramsey]

But I have been taking some steps like seeking mental health counseling, going through.

[Caller]

Financial Peace University years ago through my former church and I recently met with.

[Dave Ramsey]

A debt management counselor.

[Caller]

But I'm still feeling Stuck and unsure.

[Dave Ramsey]

What my next move should be.

[Caller]

To finally get control and give my kids a stable future.

[Jade Warshaw]

Are you disabled or are you able to work with your conditions?

[Dave Ramsey]

I'm at 90% so I'm able to work.

[Caller]

I'm an academic advisor and part time college professor. But education doesn't really pay.

[Dave Ramsey]

So with all of these different income sources, including your ex military, thank you for your service. What is your household income?

[Caller]

I take home about 4000amonth in salary and 2400 in VA disability.

[Dave Ramsey]

Okay. She got 6400 bucks a month to work with. Good. Nice.

[Jade Warshaw]

So where's the drain? Is it debt?

[Caller]

Just keeping up with child support, rent.

[Dave Ramsey]

I'm doing everything all by myself. You're just disorganized.

[Caller]

Yeah.

[Dave Ramsey]

You have no idea what's going on. You just spend money till it's gone and then you worry.

[Caller]

Yeah.

[Dave Ramsey]

A lot of it is I admittedly coping, trying to get through the season of. Yeah, yeah, absolutely. And that that would be normal. I don't blame you for that. But the good news is you can identify that so that we can whip it right. Because what you need to be is cold, calculated, and on the other side of this, where this money thing is, you're telling this money what to do instead of wondering where it went. Right, right. You want to get control rather than be controlled.

[Caller]

Absolutely.

[Dave Ramsey]

Yeah, I believe you. I don't blame you, man. I think I can smell that a mile away. I've been there. I'll tell. It kind of knots up in your stomach and moves towards your throat.

[Caller]

Definitely. Definitely. Yeah.

[Dave Ramsey]

It ain't no fun, man. So what we're going to do is I want you to flip a switch because you've got this ability, with your background, especially in the academic side, you don't need your. The debt counselor person is going to put you in more debt or they're going to put you in some kind of a debt consolidation loan. That's not what you need. You need a system where Chicco takes control. We're going to flip a switch and pretend like I hired you for $100,000 a year to manage this very simple set of finances. 6400 is coming in and every one of those $6400 needs a name before it leaves, before the month gets here, before the money actually comes in. It needs to already be spent in the EveryDollar app already be allocated. And so when you start telling your money what to do before the month begins, that forces organization and it removes anxiety and stress. Like you will not believe you're going to be amazed. Even though you're still in debt and even though you're still fighting some stuff, once you start get on, once you get on the other side of this and you're cracking the whip instead of it cracking the whip on you, you're suddenly going to get a sense of peace. Now, you got some hard work to do. You got some calluses to earn, but you can do this. And, Jade, you've been showing people how to do this in these webinars. It works.

[Jade Warshaw]

Yeah. Matter of fact, I'm going to give Kiko some homework. This is your homework. Tonight we're going to set you up with 14 days free. We're going to give you the first 14 days on us, but then after that, you got to pay for it so you have some skin in the game. But tonight, I want you to download it and I want you to set up your first budget. That's yukiko putting the 6400 that you make every month right at the top. And then you're just gonna go down and think of everything that you possibly spend money on in the month, including your debt. Write it all out. And then after that, I want you to go into the other part where it's gonna give you your personalized plan so you can start to walk through and say, okay, what do I do first? What do I do with the margin that I found? Margin is just extra. What do I do with that extra money? Which debt do I put it on? How long is it going to tell you all that? It's going to tell you what debt to put it on, how long it's going to take you to get out of debt, and then you're going to walk away with what's called hope.

[Dave Ramsey]

Yeah, it's the Every Dollar app. It started out as a budgeting app. Now it's become a financial management app because we've kept iterating it and to where it starts to tell you what to do step by step while you're laying out your plan. And our team is. Our team's here to help you. We're going to walk with you through this and we're not charging you anything. Okay. This is all just to help you out. You can do this. You'll be amazed once you lay out and say, okay. Okay, here's the seven baby steps. I need to first save $1,000 and I need to work off my debts, smallest to largest, pay minimum payments on everything with the little one. Attack the little one. And the way I'm Going to find that money is. I'm going to write it all down before the month begins in this app. I'm going to tell the money what to do and then the app's going to give you suggestions on where you find more margin.

[Jade Warshaw]

Exactly. And that's the thing, like you call, if you call into the show, based on what you're telling us, we can maybe come up with a couple of things to tell you. But the app is going to.

[Dave Ramsey]

On average, when people just fill out the stuff to start, they find about $9,560. That's been our average in the last. In the last 120 days using this.

[Jade Warshaw]

New process in just a couple minutes.

[Dave Ramsey]

Pretty incredible.

[Jade Warshaw]

Yeah, it's blowing my mind.

[Dave Ramsey]

That's the average, which means you might have 6,000 or you might have 16,000, I don't know. But you can get a head start on this thing and get it turned around and get moving in the right direction. And it's kind of like what we do here, but it's actually more sophisticated because we forget to ask.

[Jade Warshaw]

That's what I'm saying. And it'll go step by step and remind you, hey, this is what you do first, this is what you do next. And by the way, if there's something you don't understand, it'll teach it to you so that you do understand.

[Dave Ramsey]

Yeah, it'll pop up and throw a video of Jade up there explaining it or George Camel or Dave Ramsey up there explaining it for you. So the thing is thinking. Yeah, it'll show you what to do. Exactly. And you don't need a debt manager person. We'll be it for you. And it doesn't cost you anything.

[Jade Warshaw]

There you go.

[Dave Ramsey]

So you hang on, man, we'll pick up and get you set up on that. Katie is with us in Seattle. Hi, Katie, how are you?

[Caller]

I'm all right. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Well, so I have kind of a complicated question, but basically I've been trying to manage our finances as a household. I'm wife with a 14 year marriage with my husband and my daughter is also 14. Same with that as my husband and our daughter. And then we were blessed to finally have another child because we've been trying to.

[Dave Ramsey]

What's your question? Run out of time, honey.

[Caller]

Sorry. So he recently gambled a lot of money.

[Dave Ramsey]

How much is a lot?

[Caller]

I don't know, honestly. I just know that he won some money and didn't tell me about it until I started questioning why he all of A sudden had extra funds.

[Jade Warshaw]

I mean, are we talking hundreds of thousands? How much are we talking about? Give us a ballpark.

[Caller]

So I know that he had been giving me 1200 from his paycheck every week and he's now confessed to me that he actually gets about 1900.

[Dave Ramsey]

So we need to change our system.

[Caller]

Okay.

[Dave Ramsey]

He no longer gets to give you his paycheck. It's direct deposited into our checking account and we decide what we are going to do with our money. And if that includes gambling, that is a mutual decision. And obviously it would be a small enough amount that it wouldn't affect the household.

[Caller]

Right.

[Dave Ramsey]

If he can't go along with that, you have another problem. Yeah, it's a husband problem.

[Jade Warshaw]

The hard part is you don't know the exact numbers because there hasn't been that transparency. So the first step is let's add the transparency. See how does he react to that. Then you can know if your troubles go deeper than just that.

[Dave Ramsey]

Are we dealing with a gambling problem or a budget and disorganization problem? If you're dealing with a gambling problem, you can't fix that until you fix the gambling problem.

[Jade Warshaw]

Or you may find that. Sorry, you may find that you're dealing with a marriage problem. If you say, hey, I want this level of transparency and he says, I don't want to give you that. Do you see what we're saying?

[Caller]

Well, yeah, I do. And I mean this is not the first time and trust has been an issue in our relationship for various different things beside the gambling. And I feel like every time I.

[Dave Ramsey]

Bring it up he gets a little better. Yeah, but it doesn't stay there. So we need to get to solving on this because you're not going to live like this the rest of your life unless you're crazy. And you're not crazy. So you need to have all the account, all the money going to one account and we are in agreement on what we are doing with our money. Then trust will be solid. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly left behind, scrambling to pay bills and trying to make ends meet. I also discovered that there are a lot of rip offs in the life insurance world. Like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your Family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company. This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about. They shop the term life companies to find you the best options and they've been around for over 95 years, so you know they'll be there when you need them. Zander is the real deal and that's why they've handled all my personal insurance for over 25 years. I trust them and you can too. Visit Zander.com for instant online quotes or for a more personal touch, give them a call at 800-356-4282. Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love or create actual amazing relationships. Relationships. Jade Washall, number one best selling author and Ramsey personality, is my co host. Today Ashley is in Columbus, Ohio. Hi, Ashley, how are you?

[Caller]

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

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Well, we have a predicament. We have a very high net worth. But right now our financial advisor is suggesting that we take a loan out on our vacation property which is paid in full. There's no mortgage there to help supplement our income since our money is not liquid.

[Dave Ramsey]

What is your net worth? Huh.

[Caller]

About 40 million.

[Jade Warshaw]

Oh, my word.

[Dave Ramsey]

And you don't have enough income coming.

[Caller]

In off of 40 million, so it's a little tricky. 30 of that is invested in my husband's business, which is close to about a billion dollar business. But we can only touch that when we are allowed to touch it.

[Dave Ramsey]

I'm sorry, if it's your business, if it's your business, why are you not allowed to touch it?

[Caller]

So he's not on the board. So the board makes the decision on who gets money when.

[Dave Ramsey]

I thought it was your husband.

[Caller]

He's one of the owners in the.

[Dave Ramsey]

Business who's the majority shareholder.

[Caller]

There's a handful of people who own the chunk of it. He's one of those people, but he is not on the board of directors. So he doesn't get to make the decision on when redemptions can be made.

[Dave Ramsey]

So. Wow.

[Caller]

Yeah.

[Dave Ramsey]

So the. Well, that's 30 million, but you still got 10 million. You can't, you don't have anything in that. That's creating income.

[Caller]

Okay, so we've got four in retirement. Four million in retirement. We bring, he brings in about 400 a year and he's 100% commission based on what he Does.

[Dave Ramsey]

So what do you need money for if you make 400 a year?

[Caller]

So what we were hoping to do and what we had been doing with the redeeming shares each then come to find out that we can't redeem every single year was my husband's 56. And he's wanting to. After 26 years of service, he's ready to kind of back off and enjoy our vacation home. And I homeschool our kids and be a little more present after being very, very invested firsthand in what he does. So he was hoping to help to supplement our lifestyle with using some money from a heloc.

[Jade Warshaw]

How much would the HELOC have been?

[Dave Ramsey]

Okay, let's just curious. Let's just stop. Let's just stop. Stop. There's no possible way that borrowing on your lake house is a good idea when you have $40 million. There's no scenario by which I can get there. And I'm really disgusted at how pitiful your financial advisor is. This is just asinine. You make $400,000 a year. You have $10 million. It's not tied up in this company. And you guys can't figure out a way to get to some of the.

[Caller]

That.

[Dave Ramsey]

How old is he?

[Caller]

Could be six this year.

[Dave Ramsey]

Yeah. Yeah. Okay.

[Caller]

And I've just recently taken over our finances as of April because I found out a lot of stuff was going on, so.

[Dave Ramsey]

What do you mean?

[Caller]

Well, for instance, I. I just. We got married 15 years ago. I trusted him completely. He made great money. I worked as well. We had three children together. I've been homeschooling them.

[Dave Ramsey]

Yeah. I haven't heard anything wrong yet. What happened that was wrong.

[Caller]

So he trusted that he would be able to redeem shares every year and didn't realize that he couldn't do that. Then we spent money, assuming that we were going to be redeeming shares in.

[Dave Ramsey]

Excess of 400 grand. Grand.

[Caller]

Like a million over.

[Jade Warshaw]

You spent the money before you had it? Yeah. Okay.

[Dave Ramsey]

I don't know. How was that covered?

[Caller]

Well, initially we were getting the redemptions. So it was not. It was like, oh, yeah, well, we get the redemption at the end of the year, so.

[Dave Ramsey]

And how much was you redeeming of your $30 million installed?

[Caller]

A million. Million and a half a year. We put. We get.

[Dave Ramsey]

And you were spending all of that.

[Caller]

And now his income. Hang on. Keep. Keep in mind, his income would drop down.

[Dave Ramsey]

I know. A million and a half a year. On what?

[Caller]

Well, we have two homes. We have staff.

[Dave Ramsey]

Yeah.

[Caller]

In those homes, we have Children, very generous with.

[Dave Ramsey]

Still not gotten anywhere near. Close to a million and a half.

[Caller]

You got a jet horse farm that. That we pay for.

[Dave Ramsey]

You have a horse farm that you pay for.

[Caller]

Huh? Yeah, yeah, there are some things. So I've consolidated quite a bit of that. I've. I've.

[Dave Ramsey]

None of this adds up to a million and a half dollars.

[Caller]

Well, we, you know, chartering yachts and flying private. It all happened real fast.

[Dave Ramsey]

Yeah. Okay. Now I'm getting there.

[Caller]

Yeah.

[Dave Ramsey]

Okay. All right.

[Caller]

Yeah. So when I found out all of this, I said, I'm taking over.

[Dave Ramsey]

All right, well, there's not a I'm taking over. It's. The two of us need to be both using our brains about the actual money that we have to work with. And what of the 10 million can we access? And what percentage of this company does he own? Do you know?

[Caller]

Oh, gosh, I couldn't tell you that.

[Dave Ramsey]

1%, 12%, 82%. We know it's not 82.

[Caller]

Well, of a billion shares.

[Dave Ramsey]

What percentage of the company?

[Caller]

What percentage shares? I don't know.

[Dave Ramsey]

Now, that'd be a good thing to know because he needs to start taking some action because he has 30. $30 million tied up in something he has absolutely no control over. That is not okay. That is where your problem is. It is not a lake house home equity loan. Good God.

[Caller]

Right?

[Dave Ramsey]

The last thing you people need to do is be going into debt to be renting a yacht.

[Caller]

Right?

[Dave Ramsey]

You just cut your freaking lifestyle. Just cut your lifestyle. Live within your means.

[Caller]

We have to have. Absolutely.

[Dave Ramsey]

Then you don't need to be having this conversation about borrowing money on your lake house.

[Caller]

Okay?

[Dave Ramsey]

Live within your means. Now. Now, then we. How do we adjust our means? Well, one is we gotta have a discussion with these partners about, how about my $30 million? And I'm 56 years old, and I poured my life into this company, and how and when am I reasonably gonna get access to that money?

[Caller]

So we've had that conversation. I had that conversation. And it was told to me crystal clear, no questions asked. We will never PR shareholder redemptions over the growth of the company.

[Dave Ramsey]

That's not the.

[Caller]

We can't divest. We have an option to divest. They. They can. They can do it in four years. The challenge with that is on the $200,000 that we invested in this company, it turned into 30 million. So you kind of go, you don't want to completely divest.

[Dave Ramsey]

Yeah, I do completely want to divest. Absolutely. Because you are going to lose your butt. You have no control. And people are looking at you going, you have million dollars and you don't count. Yeah, absolutely. I'm getting out of that deal. Yeah, crystal clear. Meaning they were arrogant, dropped their glasses down on the end of their nose and. And man spoke you, girl. I mean, come on.

[Caller]

Yep.

[Dave Ramsey]

Bull crap. I ain't putting up with that. I'm gonna pay some taxes and get free of these jerk wads. No. No way. Redeem, redeem, redeem away way. That's what I'm doing. No chance I'm putting up with that crap. Because this story doesn't end well when someone keeps control of your of 75 of your net worth. And you have a 40 million dollar net worth, you have zero access to it. Because, darling, you don't understand how business works. We will never put redeeming of share redemption of shares above the growth of the company. No. You've got to be kidding me. So I think we're gonna handle that. We're just gonna redeem the dead gum shares. I can. I can fix that. Oh my God. So no Dar. And you may need a new financial advisor too. This one's an idiot borrow on a lake house to solve this spending problem. Yeah, I don't think so. Okay, Rachel, the Internet officially knows too much about all of us.

[Jade Warshaw]

So much, George.

[Caller]

I mean our names, our addresses, even our relatives names. And what's crazy is even if you opt out, data broker websites can still get your info.

[Dave Ramsey]

Don't like that.

[Caller]

And just a year ago, get this.

[Dave Ramsey]

The average person had about 300 pieces of personal data floating around online. Now it's over 600. It is doubled in a year.

[Caller]

Guys, that is so concerning. Because that info then can be used in phishing, scams, impersonation, and even harassment. That's why George and I both use and love Delete Me.

[Dave Ramsey]

Yes, Delete Me scrubs your personal info from hundreds of these data broker sites. Not just once, but all year long.

[Caller]

And there's real privacy experts behind the.

[Dave Ramsey]

Scenes doing this, not bots. So this is digital hygiene. We all need.

[Caller]

We all need it. And then they will send you a detailed report showing exactly where they found.

[Dave Ramsey]

Your data and what they removed.

[Caller]

And you can even request custom removals if you have something specific you want them to look out for.

[Dave Ramsey]

Exactly. And this is not being paranoid. This is staying protected. And so far, Delete Me has removed my info from 240listings and saved me 94 hours of time it would have.

[Caller]

Taken me to do it. I love it.

[Dave Ramsey]

And you guys, in a world where.

[Caller]

Strangers can Google your grandma and get enough info to scam her in just two clicks.

[Dave Ramsey]

Delete me gives you peace of mind. Yes. So go to join delete me.com Ramsey for 20% off. And that discount brings their annual plans down to about nine bucks a month.

[Caller]

So go check it out.

[Dave Ramsey]

Join delete me.com Ramsey. Well, buying or selling your home is a big deal with all the clickbait headlines and conflicting data out there. Let me help you. When there's drama going on, you know how to fix it. Facts are your friends. Facts just put drama. Just put it to sleep. It's done. So if you find out what's really going on, then all this. Oh, my God, this is me. All this stuff that's happening in the real estate market. Market, it just calms you right down. Okay, so here's the actual facts. The median home price, which, if you know anything about statistics, median is the number that's in the middle. Average is not necessarily in the middle. It's close, but they're close. Close to the same thing, but median is actually the far end and the other end and right in the middle. The median home price in America is. Has gone up again this month to $441,000. That's the median. So when you tell me you're in Kansas City and there are no homes under $800,000, I'm gonna call you a liar. Okay. You haven't looked in the right neighborhood. There are homes under $800,000 because the median in America and Kansas City would be pretty normal town. Not above average, not below average. Right there around the middle. Nashville, Tennessee, same thing. Louisville, Kentucky, same thing. Right. These are all going to hover. That's going to be your house price median. Now, I live in Williamson county, south of Nashville, which is the 11th wealthiest county in America and the wealthiest county in Tennessee. The median house price in Williamson county is not 441,000.

[Jade Warshaw]

So you're right.

[Dave Ramsey]

Okay. It's probably approaching a million. So. But it's, you know, it's crazy out here. So it's just a land that I live in right here where this building is sitting. Okay, but. So I don't know where you live, but one county over, it's a lot less. Okay, true that probably.

[Jade Warshaw]

Listen, Maury county, this is Murray.

[Dave Ramsey]

Yeah. You go down one more county from here and you get a whole different world. Most of the people that work in this building live one county further south of here and not the 11th wealthiest county in the nation. So anyway, 441,000 and by the way, that's up from 400 last, 440 last month and 439 the month before. It's averaged $1,000 a month is all. So house prices are not declining, they're increasing, but very slightly. That's the mathematical facts. 15 year fixed rate still under 6%. So if you want to know more about this kind of stuff, go to ramseysolutions.com market. Alex is in Utah. Hey, Alex, welcome to the show. How come to help.

[Caller]

I have a question about how I can help ease my wife's worries about not investing until after we're done paying debt off. I think something that kind of adds to our stress is we just had our second kid two months ago and we don't have wills life insurance, which I think causing some of that.

[Dave Ramsey]

Well, there you go. So you know, two things to fix it. Go, go to mama. Bearlegalforms.com get your will, go to Zander insurance. Get your life insurance. You need to do that anyway right now. Two today.

[Jade Warshaw]

Now. How old are you guys?

[Caller]

So I'm 26 and she's 27.

[Jade Warshaw]

Okay, and how much, what's the timeline? Because obviously you're saying, hey, I want to pay off debt and build up savings before I invest. Which is what we would teach. How, how long is it going to take you to do that before you start investing?

[Caller]

Going to be a few years.

[Dave Ramsey]

How much debt have you got? Not counting your house?

[Caller]

So we don't own a house. We have roughly 96,000.

[Dave Ramsey]

What?

[Caller]

So we have 64 on a truck and then another 2,000 on a car that we're going to pay off here in the next few months and then 24 in student loans and then 6,000 left on the birth expenses.

[Dave Ramsey]

Oh, cool. And your household, household income was what? Did you tell me that already? Oh, I didn't know.

[Caller]

It's between 125 and 135. I'm self employed.

[Dave Ramsey]

Okay, cool. What do you do?

[Caller]

Working construction. Just a foreman.

[Dave Ramsey]

Okay, good. Hey. Wow. So I got great news. Your wife is going to feel a whole lot better and you're not. You're going to get a will, you're going to get a life insurance policy and you're going to sell your truck.

[Caller]

Okay.

[Dave Ramsey]

Because your truck is stupid.

[Caller]

So one thing with that is.

[Dave Ramsey]

Oh, don't give me one thing with that. You owe $65,000 on it and your wife's afraid you're not going to get out of debt fast enough to start investing. She doesn't Believe you because you keep buying crap you can't afford.

[Caller]

That's fair. The sucky thing is, is because I bought it last year, it's worth maybe 37.

[Dave Ramsey]

Whoa.

[Jade Warshaw]

That's not because you bought it.

[Dave Ramsey]

Did you run a backhoe into it? How's it worth 37?

[Caller]

I have 27,000 miles on it.

[Dave Ramsey]

So what? It didn't drop 30. It didn't drop 30,000 bucks in value in one year.

[Caller]

That's what Kelly Blue Book said. For private. Private sale.

[Jade Warshaw]

What?

[Dave Ramsey]

You're kidding.

[Caller]

No.

[Dave Ramsey]

What kind of truck?

[Jade Warshaw]

Say, what is it?

[Caller]

It's a 24 Tacoma.

[Jade Warshaw]

And you didn't roll any negative equity in it?

[Caller]

Nope.

[Dave Ramsey]

I got to tell you, man, I. I'm a huge Tacoma fan. A Toyota fan in general. I don't own one, but I mean, my perception is not only is that a quality vehicle, but it would hold its value a whole lot better than that. I'm really shocked. I think you must have looked that up wrong. I cannot believe you cannot get $30,000 a year later for a Tacoma. You paid 64.

[Caller]

Yeah, it's pretty rough.

[Dave Ramsey]

I really. That's.

[Caller]

That's my conundrum is I'm upside down.

[Dave Ramsey]

Well, I mean, if you really are. I'm just saying I don't believe you. I think you looked it up wrong. I really do. I can't. I can't imagine.

[Jade Warshaw]

Is there anything wrong with it? Did you add something crazy to pop open your.

[Dave Ramsey]

See if you can find.

[Jade Warshaw]

I'll see if I can find it.

[Caller]

Canceled all the warranties and everything. So that's.

[Dave Ramsey]

That's good. Okay, well, you're on track. All right, so here's the thing. The reason that she doesn't want to stop investing is because she's afraid we'll never restart.

[Caller]

Uh huh.

[Dave Ramsey]

Not because she does. Not because she thinks it's the wrong thing to do. If you really believe that you could be completely debt free in two years by being on beans and rice. Rice and beans. And then take $125,000 income and invest that wisely for the rest of your life, you'd be multi millionaires, mathematically. Easily. Easily.

[Caller]

That's the plan.

[Dave Ramsey]

Yeah, that is the plan. But that requires that you play all the way through. And nothing in your all's path indicates that to her. So she's got to feel like, a, she has a vote on this budget, B, you're willing to do whatever it takes to get there, and we're gonna get there as fast as we possibly can because it's urgent. That we start investing because your most powerful wealth building tool is your income. And right now you're giving it all to Toyota, basically. Yeah. And so she knows that. And so, um, it's not that our, your wife won't go along with really stopping investing in order to get out of debt, it's that she doesn't want to stop investing, to never get out of debt.

[Caller]

Yes. And that's like I've, I've continuously expressed to her, like, hey, we're done. Like, I'm done buying new vehicles. That was a stupid thing. I started listening to you guys like two months after I bought. I'm like, no, that was a stupid tax.

[Dave Ramsey]

I'm paying now. Yeah, you are. If that's the real numbers. I, I'm. God, I'm distressed because I just love that car. But I don't love it enough for you to keep it. But I love it. All right, well, I think you guys keep talking through this, but that's what you've got to become of a common mind that we are willing to sacrifice in order to get there. And we both believe it's really going to happen. She's afraid it's not really going to happen, that we're not going to play through at my house when I was your age. I'm not accusing you of this, Alex, but it was me. And sometimes this is true. I would come in with a new scheme or a scam every week that we were going to do. And if my latest one was we're going to stop all investing to get out of debt after the other schemes and scams only lasted three or four weeks or three or four months, my wife would roll her eyes at that time and go, oh, another one of things you're not going to play through on another one of your great ideas, Dave. And you know, that was back 35 years ago. Today we're very, very much on dialed in, very much aligned. Do you find anything at all?

[Jade Warshaw]

I'm just, yeah, he's not far off. I'm just trying to understand how you spent what you spent to begin with and why I can find them for 31,500 in that, that type of price range. So I don't know what you you did, but you did it.

[Dave Ramsey]

If you owe 60 on it, unless you borrowed on a subprime loan and the balance is not only 60, but the total of payments is 60, that's another possibility. Maybe that's not the real payoff. Make sure you got real payoff numbers. Maybe that's the Number. That's the wrong one. Fight through it, Alex. Fight through it. You're on your way.

[Jade Warshaw]

Sam.

[Dave Ramsey]

Anna is in Albuquerque, New Mexico. Hi, Anna. Welcome to the Ramsey Show.

[Caller]

Hi, Dave. Hi, Jade. Thank you for having me.

[Dave Ramsey]

Sure. What's up?

[Caller]

So my question is, while we're working through the baby steps, how do we handle family dynamics and not seem like the cheap family?

[Jade Warshaw]

This sounds like expectations from extended family. Yes.

[Caller]

Yes.

[Jade Warshaw]

Like what?

[Caller]

They are familiar. They are familiar with the Ramsey method. They actually kind of introduced us to it. But they have since they decided to kind of give up on it. And they said to they're gonna make memories with their money now instead.

[Dave Ramsey]

Who is they?

[Caller]

Sister, brothers in law.

[Jade Warshaw]

And so they've decided, hey, it was too much for us, we're not doing it. And they think you should be in that boat. Whereas, though, you've said, hey, no, we want to be intense, we want to pay off our debt, we're going to do that. And they're kind of making you feel bad about it. Yep.

[Caller]

Yeah. Give me.

[Jade Warshaw]

Give me an example.

[Caller]

Yeah. So, for example, they like to go to places where they play golf for fun. That, you know, is that recreational place.

[Jade Warshaw]

Top golf.

[Caller]

Huh?

[Jade Warshaw]

I said topgolf. It's expensive.

[Caller]

Yep. And we're a family of six, so trying to. To cover that. And I have tried suggesting alternative activities for us to do, and they often kind of respond with, that's boring.

[Jade Warshaw]

Well, then, you know, okay, that's a great example. I mean, this is one of those times where you're just gonna have to, Anna, put your foot down and say, we're not going. I mean, I can't tell you how many times when Sam and I were getting out of debt that I would just say, hey, that's not a priority for us this month. And I might suggest something different. And maybe I don't. If, you know, if you guys are.

[Dave Ramsey]

Going out, we just can't do that this month.

[Jade Warshaw]

Yeah, we're not able to go this month. And like I said, you can suggest another option. What if you guys all came over here and we did board games, and if they say, no, that's not fun, then that's then their choice. So the same way you can't get mad, the same way you don't want them to get mad when you make your choice, you then can't be offended when they make theirs, which is, we don't want to do family board game. We want to go to topgolf. Okay. Have fun.

[Dave Ramsey]

Yeah. I hope you had a great. Hope you have A great time.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

And we. It's just. It's not. It's not. We can't do it this way. Month. But thanks for asking.

[Caller]

Right.

[Dave Ramsey]

You know, let's pretend. Let's pretend something was crazy. Okay. Someone called you up and said, hey, I want you to charter a private jet and fly to London. You would go, I'm sorry, that would be neat. But I'm not going to be able to do that. Why? Because it doesn't fit your financial picture.

[Caller]

Right.

[Dave Ramsey]

Even though that person might be able to charter a private jet to London, which, by the way, be like 120 grand. Okay. But, you know, so it's not. Yeah. So you just. It's just something you can't afford to do is all it is. I mean. Oh, well, you know, toughies. I mean, hey, we want you. We're. We're all buying new. New boats, and we want you to go get a new boat to match our boats. Oh, that'd be sweet. I wish I could, but I'm just not able to do that right now. I hope you guys enjoy your boats.

[Jade Warshaw]

In that moment, with the extreme examples that Dave is giving, you'd be able to see how absurd it is that.

[Dave Ramsey]

Someone else is trying to manage your money.

[Jade Warshaw]

Yeah. And that they would be able to say what you can and can't afford. You realize how absurd that is? It's the same thing here. It's just a smaller. It's just a different scale. And, you know, you can't afford to take your family of six to topgolf because you've got more important priorities. But they don't get to decide that. What's the repercussion? Tell me, is it even real? Let's decide. Is this something that's just taking place in your mind or if it's really happening? What happens when you say, hey, thanks for inviting us, we're not going to go this month, but you guys have a good time? What then takes place? What do they do to retaliate?

[Caller]

So. So they'll go ahead and do the event, which is fine. And then I guess it does put it on us to maybe try to set up something else outside of that event at a different time.

[Jade Warshaw]

See, and I don't think it does. I think you kind of created something that's not even really there.

[Dave Ramsey]

You just didn't go. That's all it is.

[Caller]

Yeah.

[Dave Ramsey]

You just didn't fly to London.

[Caller]

I think they're just getting tired of us saying, sorry, we can't decide.

[Dave Ramsey]

Who gives a crap? Crap what they think they don't get a vote. Listen, people that love you are supposed to encourage you.

[Jade Warshaw]

That's right, Dave.

[Dave Ramsey]

Not send you on a, not be travel agents for guilt trips. You are way too worried about what other people think, kiddo. Just smile and be happy and happy that they want to go to topgolf. Hope you enjoy it. Topgolf's fun, but it really won't change your life. Life.

[Jade Warshaw]

And can I just, I, I, I'm creating something here. But can I just say, these types of people are the same people that when you do get out of debt, Anna, and your money is looking good and you do have margin and maybe you want to do something beyond top golf and they can't afford it. These are the type of people who will be frustrated then at you for that as well. Does that make sense? You're not going to win with these folks.

[Dave Ramsey]

Yeah. When you're, when you have, when you have $2 million in your account and you guys are going to go away for an expensive weekend at the Montage, want to invite them? They're going to be going. Well, wouldn't it be nice?

[Jade Warshaw]

Yeah, that's right.

[Dave Ramsey]

Wouldn't it be nice if we were like you? Yeah. Well, it would have been 10 years ago if you'd have had a dadgum half an ounce of maturity and learned to live on less than you make. But you know, you just have to keep all that to yourself. And it's just, you have to be sweet, be kind, and just know I can't go and quit reading into it, that somehow you've done something wrong. Even if they think you have, they don't get a vote.

[Jade Warshaw]

The biggest, the biggest superpower you can have with your money is not caring what people think. That's the number. If you can accomplish that mentally, you can go further, faster.

[Dave Ramsey]

Well, because that jade bleeds over past this type of discussion because it bleeds over into the. I'm not buying the crap I saw on Instagram to make people think I'm somebody you don't care. I don't need to buy, I don't need to carry a purse. I don't need to wear a shirt or shoes or drive a car or live in a house or go on a vacation for someone else to look at. And I was that guy in my 20s, I really, I bought a Jaguar. I had a Rolex, I had custom made suits I wanted when I was making a little money back then, before I went broke and I really wanted other people to be impressed. And one of the benefits of going broke is I lost all of that. My need for you to be impressed with me is zero.

[Jade Warshaw]

I hear that.

[Dave Ramsey]

The only thing I want to do is just love you and help you. And if you're not impressed, fine. If you are impressed, that's fine too. Life's good. Go on and do your thing. And I'm probably never gonna see you again anyway, so good luck with that. And you know, it's okay. Cause you know I'm not gonna spend now. I've got a nice car, I got a nice truck, a nice boat, whatever. But it's for me. It ain't for you. It's not for you to look at. I don't care whether you know what I drive.

[Jade Warshaw]

I think that is one of the benefits of when you do walk through the baby steps as we teach it. More importantly, when you walk through the debt snowball. Right.

[Dave Ramsey]

Because you're sacrificing, you have to not care what people think.

[Jade Warshaw]

Yeah. Cause you're sacrificing. And there's part of that you can't h shows. And so you start getting used to it showing. You get start. You start getting used to wearing the same clothes. You get used to saying no to going out dinner.

[Dave Ramsey]

You get a Jaguar repo to show.

[Jade Warshaw]

Yeah, that'll knock you out.

[Dave Ramsey]

That's a problem.

[Jade Warshaw]

And so.

[Dave Ramsey]

But it ain't there no more.

[Jade Warshaw]

The positive side of that is, yeah, you, you kind of burn out that part of you that cared about what other people think. And when it's gone, that's a great place to be.

[Dave Ramsey]

Yeah.

[Jade Warshaw]

Your confidence comes.

[Dave Ramsey]

It's kind of sweet when it's coming from her because she's kind of sweet.

[Jade Warshaw]

Yeah, she's.

[Dave Ramsey]

But just. It's not, it's not getting power. The power comes from I love you, I want good things for you, but we're going to do our thing over here. Over here. We're going to do our thing. That's what we do over here. And you know, if you, if you're going to be mad about that, then you're just going to be mad about it. Yeah, I'm going to vote for who I'm going to vote for. I'm on a travel where I want to travel and buy the car, I want to travel, travel. I'm just not. My need for you to be okay with that is really, really low.

[Jade Warshaw]

Yeah, it, it's different. You know, when you're in debt, you are. Your self esteem is low and you're trying to cover that up with Buying things and going places and doing things. It's a different motivation than when you're on the other side of it. The list of things you want even changes because it's coming from a different place. It's not coming from insecurity.

[Dave Ramsey]

Good point. Interesting. So Anna, honey, they don't get a vote. Just smile at them. Have fun at topgolf y'.

[Caller]

All.

[Dave Ramsey]

See you next time we have dinner. It's all good. Sarah is in Los Angeles. Hey, Sarah, what's up?

[Caller]

Hey. How are you?

[Dave Ramsey]

All better than we deserve. How can we help?

[Caller]

I doubt that. I think you deserve it. I just received $100,000 from my parents. I'm married, so my husband and I just received this.

[Dave Ramsey]

Wow.

[Caller]

And I know as a gift.

[Jade Warshaw]

Or was it a. Did someone pass away?

[Caller]

It was. It's a gift.

[Jade Warshaw]

Okay.

[Caller]

They also gifted my brother the same and his wife. And so I, I just want to make sure I do the quote right thing with this money, I'm looking at paying off both of our cars first. We don't have any credit card debt. We pay it off every month. But I'm actually going to stop using a credit card.

[Dave Ramsey]

Wow. I like you already.

[Caller]

Well, thank. I appreciate your guidance. So I felt like the credit card was not optimizing my savings. Like it just. I was spending more than. And yeah, it just does that for some reason.

[Dave Ramsey]

Okay, so your only debt other than your home is your cars.

[Caller]

That's it. Yeah.

[Dave Ramsey]

And how much are they? What's the debt on them?

[Caller]

So 16,000 on one and 7,000 on another.

[Dave Ramsey]

Okay, well that's kind of a no brainer. Good. Okay, so 23 of the. Of the hundred is gone. Okay.

[Caller]

Yep. And then I was thinking about doing about 32,000 in an emergency fund. That would be four months of my husband's income.

[Dave Ramsey]

You don't have any money in an emergency fund today we have 3,000. Okay. Oh, that would put you at 35. Okay. I got you. I see what you did. Very good.

[Caller]

So. And like that would be, I assume and we have it just in like a high yield savings. Is that where you would keep it? Because it's liquid. More liquid.

[Dave Ramsey]

You're doing really good. I like it. Like your plan so far A lot.

[Jade Warshaw]

What's the next part?

[Caller]

Good, good, good. And then the car payments I was going to put towards my mortgage. The car payments that we would have had. Not sure what you think about that. It would be.

[Dave Ramsey]

The main thing I would just do is I would do a budget and I'd start putting 15% of your income towards retirement, doing something toward doing something towards kids college out of your budget and then out of your budget, which includes no car payments. Now then I'm going to put some extra on the mortgage. I don't know how much it may or may not equal to the old car payment.

[Caller]

Okay, I see. Yeah.

[Dave Ramsey]

Because I just want you to do a budget and find money in there to live. And now you move from intensity to intentionality because you're in baby steps one or four through six, which is 15% into retirement, kids college savings, and then systematically pay off the house while enjoying our life.

[Jade Warshaw]

Were you already investing? It sounds like you were.

[Caller]

No, we're not.

[Jade Warshaw]

Okay.

[Caller]

Not vested yet. So that was kind of my next step. If I have a little bit left. We do want to paint our house because it's crumbling and do a couple things to help improve my side hustle, which is our Airbnb in the house.

[Jade Warshaw]

Okay.

[Caller]

After that, I don't, I don't know. Yeah, I don't know where to start for investing. And also another piece is My husband is 20 years younger than 20, two years younger than me. So I'm 54, he's 32. You. I wonder if that factors in at all for.

[Jade Warshaw]

Well, I wouldn't, I wouldn't pause investing to do the things that you're talking about with the home. Investing is something that. It's kind of like you said it and forget it and it's the new normal. My guess is that once you pay these cars off, basically that money that you were paying in car payments, you're now going to feel that go away in your 15, that anom. And your 15% that you're investing every single month. So turn that on immediately. Once you park this money in the savings in your emergency fund. Turn the, turn the investing on and immediately because you'll be.

[Dave Ramsey]

We still got about 50 grand we got to decide what to do with.

[Caller]

Right.

[Dave Ramsey]

And what was your plan with the other 50 grand?

[Caller]

I mean, I was gonna get a new tooth because I had my. Some of my teeth. I gotta get a new tooth. Unfortunately, I live in a very expensive area. It's gonna be about 8 grand.

[Jade Warshaw]

Get your tooth.

[Dave Ramsey]

Okay.

[Caller]

Get my tooth.

[Jade Warshaw]

Yeah, you need to get your tooth.

[Caller]

Get my husband's life insurance because we don't. We have it on me, but we don't have it on him.

[Jade Warshaw]

Okay, that's smart.

[Dave Ramsey]

Get a will.

[Caller]

Pardon me?

[Dave Ramsey]

Get a will.

[Caller]

Yes, yes, we have a will.

[Dave Ramsey]

Good, good.

[Caller]

It's like budgeting. Like I said, I was Using the credit card. And I just noticed yet we could pay it off. But I was kept stretching it every month so I want to stop doing the credit. I was trying to get air miles because my baby girls fly is going to college across the country. So I want to be able to see her. But I'm wondering.

[Dave Ramsey]

Yeah, I think you just pay for your airline tickets.

[Jade Warshaw]

Have you received the hundred thousand yet?

[Caller]

Yes.

[Jade Warshaw]

Okay. Do you have the credit card?

[Caller]

Do you have the credit card? Yeah.

[Jade Warshaw]

Why don't you pull it out of your wallet right now and cut it up?

[Caller]

Okay.

[Jade Warshaw]

I think that would be a great way for you to. To turn over a new. A new leaf.

[Caller]

Why?

[Jade Warshaw]

Why? Why save for tomorrow what you can do today?

[Caller]

Yeah, that was my point is like I couldn't. I just save money for airline tickets.

[Dave Ramsey]

And actually have money for airline tickets. So you need to get on the everydollar budget and it'll walk you through all these baby steps as well as help you plan with your monthly spending that you and your husband can agree to. So we'll give you 14 days of free premium version. You need to try this new version of everydollar we just came out with. You're going to love it. It's going to hold your hand and walk you through all the things we were just talking about. So now you're debt free. You have an emergency fund. You're living on a written plan so that you're spending money wisely. Oh, $8,000 for a tooth. And so we have $42,000 approximately left 32 and yeah. No, no, no, no, no. It's not quite that. It's not quite that much. It's like. But anyway, whatever we've got left, I still want you to, you and your husband sit down. I would recommend that you plan to enjoy some of that.

[Jade Warshaw]

I agree.

[Dave Ramsey]

It might be a small trip. It might be a new couch. We might need a new bed. We haven't bought a mattress in 15 years. It might be.

[Jade Warshaw]

Oh, yeah. You said you wanted to paint the house.

[Dave Ramsey]

If you want to paint the house, if you want to upgrade a car a little bit. But all of that is with cash. We're not going back into debt after we just turn around and cleared the debt.

[Caller]

Right?

[Dave Ramsey]

So just take like a piece. Take a yellow pad, put $100,000 at the top, and you and your husband sit down and give every one of those dollars a name. We know 16 and 7 went to car. We know 8 went to tooth. We know 32 went to finish up the emergency fund. Okay. So you just keep working your way down until the money has already got a name. Because if you don't do that, what we all do, if we keep it just kind of floating around in our brain, is we spend $100,000 four times.

[Caller]

Yes, yes.

[Dave Ramsey]

And you end up worse off than if you hadn't gotten the thing. And you also have this horrible taste on the back of your tongue called regret. So, yeah, you just have a diligent plan and it's not going to go as far as your emotions wished it would. It's not going to go. 100,000 isn't what it used to be. Well, that's true. It's just not. So.

[Jade Warshaw]

But it's getting a lot done for you. It's getting out of debt, it's getting you an emergency fund.

[Dave Ramsey]

You're advancing right down these baby steps and getting yourself in a position to really build some, really some real wealth.

[Caller]

I know. I'm slaying the baby steps. It's so fun. I'm so appreciative of my parents. How do you restock your emergency fund? Do you put a. A little bit every month?

[Dave Ramsey]

You don't need to restock it.

[Jade Warshaw]

You don't need to. But let's just pretend you did have an emergency fund and an emergency happened. You spent, you know, $3,000 on a new AC.

[Dave Ramsey]

You put it back as soon as possible as quickly.

[Jade Warshaw]

It becomes your the 30 day challenge as quickly as you can.

[Dave Ramsey]

And I'll tell you what else. If you did end up using it, I'll be shocked because once you get to the stage that you are now at and you've got enough income coming in and no payments going in, out, a lot of what used to be an emergency becomes a monthly budget item. Like if you had a $3,000 hit and you got no payments in the world, you can just tighten up the budget real tight one month and just do it and not even hit the emergency fund. So what used to be an emergency, a flat tire is no longer an emergency. It's just a crap. I got to take that out of this month's budget and you can actually cash flow through them.

[Caller]

Oh, okay. And what about for vacations? So save up and pay for them separate account.

[Dave Ramsey]

Or you can have a separate account or a separate line item within an account. Same thing as Christmas.

[Jade Warshaw]

Yeah. I'll tell you what I do practically.

[Dave Ramsey]

I looked it up, by the way. Christmas is in December this year.

[Jade Warshaw]

I'll tell you what I do practically. I have a separate. Even I have a separate banking institution for my emergency fund because I don't even like looking at it. I don't touch it. It's just over there and then it's. Any other normal savings for trips and.

[Dave Ramsey]

Things like that can be in the other bank. It can all be in one account. But just kind of keep a little spreadsheet on how much of that account is for trips, how much is for Christmas. So on that kind of thing, just keep a breakdown on it. It's called a sinking fund. When you're working your every dollar budget, it'll help you do that too. I was sick and tired of being sick and tired. Bankrupt with a toddler and a brand new baby at home. Scared doesn't even begin to cover it. But I got mad enough to change. I started using God's and grandma's ways of handling money. That journey became the total money makeover, a plan everyday people can use to take control of their money. Million have changed their lives following the plan in this book and found hope. Start your makeover [e-mail] store. Live from the headquarters of Ramsey Solutions. Ramsey show where we help people build wealth, do work that they love and create actual amazing relationships. Jade Washall, number one best selling author and Ramsey personality is my co host today. Open phones at 888-825-5225. Ron is with us in Honolulu. Hi Ron, how are you?

[Caller]

Great. How are you Dave and Jade?

[Dave Ramsey]

Better than we deserve, sir. What's up in your world?

[Caller]

Hi sir. I'm a 49 year old active duty army officer, got 26 years in, married with three teenage daughters.

[Dave Ramsey]

Thank you for your service.

[Caller]

I was diagnosed. Thank you. I was diagnosed with cancer last month and in the process of kind of getting our finances in to order. Order, I was able to sell my truck and make $20,000 profit. I was trying to get some advice from you all. On with the current market. Where it stands would be the best use of that money for investing either lump sum into the market or gradual over time.

[Dave Ramsey]

Wow. What is the prognosis of your cancer diagnosis?

[Caller]

We're still not sure yet. We're obviously trusting God. I had surgery last Thursday and we should get the pathology back this week. But we're hopeful it was a miracle was caught as early as it was so optimistic.

[Dave Ramsey]

So the optimism is obviously part of your faith, but it's also the fact that you caught it early.

[Caller]

Yes, sir.

[Dave Ramsey]

All right. Okay. And do you guys have any, any debt now other than your home?

[Caller]

No sir, we, we actually did financial Peace University in 2010. And we, we live on base now in Hawaii, so we don't own a home. And we've been investing for, for quite a while.

[Dave Ramsey]

Okay, and so what is the size of your nest egg, sir.

[Caller]

For? With my wife and I's Roth IRAs, it's. We have about 750,000 total invested. Between the two IRAs and my TSP, our emergency fund is just under 30,000.

[Dave Ramsey]

Man, you've done part of our. John, you've done such a good job.

[Jade Warshaw]

Really good.

[Dave Ramsey]

Such a good job. All right. And any light, any life insurance in place?

[Caller]

I have my sgli and then I have policies on my wife and daughters.

[Dave Ramsey]

On you, that's 200k. Right?

[Caller]

On you, it's 500.

[Dave Ramsey]

500. Oh, okay. Oh, officer. Okay.

[Caller]

Yes, sir.

[Dave Ramsey]

Okay. Wow. And you got a will in place?

[Caller]

Yes, sir, we have a will. We, thankfully we got a will. All the, all the things legally that we need in place for my wife and daughters.

[Dave Ramsey]

Good.

[Caller]

So they'll be able to get the life insurance and all, everything else that we've got in this.

[Dave Ramsey]

Because my experience, experience in these situations is just looking in from the outside like I am now that when you have checked all of those boxes and you've got everything tight, you got a tight situation, everything's up to date, ready to go, you don't have to think about those things. You can put all of your energy in fighting cancer, which is where it needs to go.

[Caller]

Yes, sir.

[Dave Ramsey]

Okay. So we don't think about all this other stuff because you've done such a good job. Your prep on life in general is so, so grown up, so adult. So well done. I'm so proud of you. Very, very well done. So all of that to say the $20,000, where it's invested or how it's invested is not going to change your family's life. All the other things you've done is going to take care of your family whether you live or whether you die. Okay. And so the rest of the picture we've just been discovering since you called in and how wonderful a job you've done is what takes care of them. 500,000, 750,000. No debt, no house debt, living on base. I mean, you guys have got, you have a detailed, well executed plan. So she's fine, they're fine. Whether we take the 20,000 and burn it in the middle of the floor or not, they're fine. So that's not to say we don't want to do something smart with it. Now, having said all of that. Of that. What would I do if I had an extra 20 grand laying around? I'll tell you what I would do with it. I did it this afternoon. I'd dump it into an S and P index fund and just throw it in the market. It may be worth 15,000 a year from now and it might be worth 25,000 a year from now. And neither one of those numbers are going to change my family's life. And neither one of those family numbers are going to change your family's life. I don't know what the stock market's going to do, but it goes up more and it goes down. And over time, it's gone up if you leave it alone. So if you leave alone five years, you have a 97% chance based on history that you're going to have more in there than you should put in. If you go to heaven and she's got a 97% chance if she leaves it alone five years, that it's going to be worth more. Right. And so me, I'm just going to grab an s and P500 fund or sit down with your smartvestor pro, whoever's helping you with your investments and pick a good growth stock mutual fund fund and drop it in there and forget it. And then who cares what the news says tomorrow? Because if you read the news, it may go down tomorrow right after you do it. But I don't even. That's not my motivation. My motivation is I'm putting it, I don't need the money. I'm going to leave it alone a long time. And you're going to leave this alone a long time, right?

[Caller]

Oh, definitely, yeah.

[Dave Ramsey]

Yeah. So if you're investing it, which means you're going to leave it alone a long time, that's the definition of investing. Five years or longer then. And that's your mindset. Three years or longer. You're going to make some money that way. And I would just Loan Summit, but you've got to commit to yourself to not go, oh, no. I turned on Fox News this morning and President Trump burped and the stock market went down. Because when he burped, the French burped three times and the Chinese burped five times and oh my God. And this is what happens. And then the market goes back and forth. The market goes back and forth. That's exactly what happens.

[Jade Warshaw]

How long do you plan to live on base?

[Caller]

There's still a lot of unknowns on whether or not I can continue to serve and whether or not I'LL need to retire and move back to the mainland. So, I mean, we're secure if whatever, long, however long we need to be here. The Army's taking care of us to get treatment and stay here.

[Jade Warshaw]

You might, you might factor that into the investment of that money. If you think that it's less than a five year play for you to be on base, it might serve as some down payment going forward. That's just one thing to think.

[Dave Ramsey]

Yeah. But it's probably, you know, a two or three year play anyway, so. Yeah. Cool. Ron, I just got to tell you, I'm so sorry that you're having to fight this. And I'm so proud of you. The job you've done as the dad, as the husband, to take care of your family. You have just done a stellar, exemplary job. It's amazing. Thank you. Thank you. And we'll keep you in our prayers, brother. You're going to be fine. Oh, man. Wow. It's so weird, the sense of I have my act together and how that factors into a wellness equation when you're fighting an illness or even a terminal illness.

[Caller]

Yeah.

[Dave Ramsey]

I've got several friends right now that are facing different kinds of dramatic health issues. And the way they are reacting is based on two things. Their faith walk, their spiritual walk, and whether or not they know everybody's gonna be okay because they got their act together. They got their act together. And if you got your act together and you know, it's. Then you can just kind of put that to the side and work on what's important, you know. It's pretty incredible. Wow. Another reason yet to do this stuff, boys and girls.

[Caller]

Hey, guys.

[Dave Ramsey]

George Camel here with some exciting news for our Financial Peace University coordinators.

[Jade Warshaw]

If you've ever led FPU or even.

[Caller]

Just thought about it, you've got to.

[Dave Ramsey]

Join us for our coordinator rally happening on July 2020 24th. It's packed with insider updates, powerful stories and encouragement from me, Jade Warshaw and Dr. John DeLoney. It's totally free and when you register, you'll be entered to win our $3,000 giveaway. So just head to fpu.com rally to save your spot today. That's fpu.com rally. John is with us in Canada. Hey, John. Welcome to the Ramsey Show.

[Caller]

Hi, Dave.

[Dave Ramsey]

Hi. What's up?

[Caller]

I am in massive amount of debt and I don't know what to do. I just feel like it's a huge weight on my shoulders. We owe over $400,000 between credit cards, credit lines and a car loan. And our Take home pay after taxes is around $13,000 between my wife and I and our expense is about $10,000. This is after we stripped out everything.

[Dave Ramsey]

So how much on credit cards?

[Caller]

On credit cards and line of credits, around 350,000.

[Jade Warshaw]

What's that a result of?

[Caller]

So it's twofold. So we faced a deposit on a house during COVID and we were selling our house at a profit. Originally, the buyers couldn't close on it, so we had ended up selling and taking a loss. And to close on the other house without losing it, I had to take money out from our credit line to pay. So that was about 150,000. At the same time, I got really sick and to the point where I didn't think I was going to live. And so when I got out of that something, I guess the switch flipped in my head saying, why am I being so frugal about money? Because I used to follow the Dave Ramsey principal is very, very, very good. And we were pre2021. We were out of debt. And so I started, because of this illness, I just started spending. And so it went down this spiral. And now I've Learned being in $400,000 of debt and mentally better, it wasn't a good decision. And so now.

[Dave Ramsey]

So you own a home?

[Caller]

We own a home. It's worth about a million dollars. We owe 850, 50,000. It's worth about a million now because it's, it's down. But a year ago was probably 1.2, 1.3.

[Dave Ramsey]

Okay.

[Caller]

Why is it that Canadian market has taken a hit? Because of interest rates here.

[Dave Ramsey]

Oh, okay. Okay.

[Caller]

Yeah.

[Dave Ramsey]

All right.

[Caller]

So I, I, I'm, I guess my question is when does it make sense to consider bankruptcy? Because I'm doing my numbers here. I'm paying, we're paying this $3,000. I'm trying to, to do Ubers and whatnot on nights that I can. We're throwing everything at the debt, but when I do the math, it's $36,000 of interest annually and I'm only putting in 3,000amonth. So to me it's like this vicious cycle.

[Jade Warshaw]

Are you, are you well now? Are you healthy?

[Caller]

I am, I am better. But obviously this stress of debt is mentally a burden and I'm connected to the right therapist.

[Dave Ramsey]

We have a church as well. I don't know Canadian bankruptcy law at all. All in the U.S. were you to file bankruptcy, you would have the option of keeping the car and keeping the house by reaffirming the debt, which means you don't bankrupt on that debt. You keep that debt and you keep the asset, which would absolutely be asinine, obviously. But if you're going to file bankruptcy again, I don't know Canadian law, I have to assume that they have collateralized of those loans somewhat like they do in the US Though, if I woke up in your shoes and again, subject to not knowing the laws there, and I would want to know that, to know what was possible there or how that thing works. But if you were in the us it'd be very simple for me to tell you because I do know the law there are here. I'd sell my car and sell my house.

[Caller]

Yeah, my car. So we have a Tesla. We owe 80,000 on it, but we bought it when that was at the top of the market. And it's worth, based on auto trader, which is similar to Kelly blue book, about 40,000. So it'll be underwater about 40k.

[Dave Ramsey]

And sell my car, not sell my house.

[Caller]

Okay.

[Dave Ramsey]

Because you have huge car payments and you have huge house payments.

[Caller]

Yeah.

[Dave Ramsey]

And you have a decent income. And if you did that, you can claim, clean up a portion of this debt, over half of it, and then you would just plow through the rest of it, get your life back and then start rebuilding again. Because the house doesn't have much equity in it. It's not like it's some kind of big prize and other than it's probably a nice home, but it's a serious burden. The Tesla's serious burden.

[Jade Warshaw]

My guess, there's.

[Caller]

I would just take the 40,000 that I'd be underwater and just add it to the debt snowball, actually.

[Jade Warshaw]

And is there anything in the house? I mean, this is a lot of spending in a short period of time. Anything in the house that you can sell and liquidate and get rid of.

[Caller]

We've been doing that. Yeah. We've been putting everything and anything on Facebook, Marketplace, and it's, it's been. I mean, we've been getting, you know, 50 to 100 to $200 here and there that we've been throwing on and we continue to do that.

[Dave Ramsey]

There's no big item you purchased in the spending spree.

[Jade Warshaw]

Yeah. Because you left out selling the Tesla. That's what I'm saying is you left.

[Dave Ramsey]

Out selling the motorcycle or the sea dish or the snowmobile.

[Caller]

Yeah, we, I mean, we have TVs, but I don't know how much those are.

[Dave Ramsey]

That's not, that's not what I'm talking about. What did you spend money on?

[Caller]

Yeah. It's really bad. Just trips.

[Dave Ramsey]

Okay.

[Jade Warshaw]

Okay.

[Dave Ramsey]

All right. Yeah, we can't get. Can't get those back. Hard to repo that, but okay. Yeah, I'm just going to fight my way through this and you're going to take some lumps here. This is not going to be pleasant. But neither is bankruptcy, by the way, because you're turning in the Tesla. You turn in the house if you file bankruptcy anyway by US law. But now I don't know again what Canadian law is, but I can't imagine a bankruptcy process in a North American country like Canada that allows a bank to not get their secured position. I would be shocked. Thus, a mortgage or a loan on a Tesla, they at least have a lien against the Tesla. They have a lien of some kind against the house. And that lien is protected in bankruptcy in the United States. And I suspect it works as as far same way somewhat there. It's logical that it would. So. But again, I do not claim to know the answer there. I just. I think you guys just went through a series of large bad decisions and now you're going to go through a series of hurtful good decisions to clean up the mess from the bad decisions. So you got about two years minus a house and a Tesla to get your life back, and then you start fresh again. That's what it sounds like to me. I think you'll be free in about two years because you make pretty good money, but you're consuming all of it still. And you've justified that as like, this is our minimum baseline. No, it's not. Million Dollar House is not a minimum baseline. Nope. And neither is a Tesla, for God's sakes. Not a minimum baseline. So. Not even if you're George Campbell or Rachel Cruz. So there you go. Abby is in Jacksonville, Florida. Hi, Abby. How are you?

[Caller]

Hi. Great. I have a question.

[Dave Ramsey]

Okay.

[Caller]

My husband and I are currently debt free.

[Dave Ramsey]

Good.

[Caller]

Exception of our house. We're wanting to buy a specific business. And my question is one, do we buy the business? But more importantly two, do we pay cash for the business or.

[Dave Ramsey]

You don't buy it unless you pay cash. Cash for it.

[Caller]

Okay.

[Jade Warshaw]

Do you have the cash?

[Caller]

Yes.

[Jade Warshaw]

How much is it?

[Caller]

We have about 220 in a high yield savings account.

[Dave Ramsey]

What do they want for the business?

[Caller]

80,000.

[Dave Ramsey]

What is it?

[Caller]

It's an after school enrichment program.

[Dave Ramsey]

Why do you want to buy it?

[Caller]

I want to buy it because he loves what he does. So nothing would change with his job. I'm a pediatric oncology nurse. I've been doing it for 15 years and I'm, I, I'm just looking for something else, something where I can be home with my kids more and just, you know, run my own business with my own house.

[Dave Ramsey]

What the business profit? Net profit.

[Caller]

Last year, 50,000.

[Dave Ramsey]

Okay. And then what? How much for it?

[Caller]

80,000.

[Dave Ramsey]

Okay, that's, that's a good return. That's a cheap price. So I want you to investigate carefully what's going on because if it truly made 50 grand, it's worth more than 80. But get into it and figure out why they're selling it, what they're doing. And if you got 200,000 bucks in them in the bank and you want to pay cash and write an $80,000 check and start your next business and move on to the next thing after. Yeah. I can't imagine the job you've had. Ouch. Rewarding, but also trauma filled.

[Jade Warshaw]

Yeah, that's right.

[Dave Ramsey]

Yeah. Wow. I don't blame you. This is the Ramsey Show.

[Caller]

Foreign.

[Dave Ramsey]

Hey, what's up?

[Caller]

Dr. John Deloney here. The new dates have dropped for the money and marriage getaway over Valentine's day weekend in 2026. This is your chance to hit pause on everything in your life and reconnect with your spouse over a long weekend in Nashville, Tennessee. Me and my friend Rachel Cruz will be digging into topics like sex, money, communication and more. This weekend is happening on February 12th through the 14th and early bird. Prices start at $749 per couple, but the prices will be going up soon. Get your tickets [e-mail] events.

[Dave Ramsey]

The Ramsey Show Question of the day is brought to you by why Refi? When the payment on your defaulted private student loan is as much as some mortgages, it's hard to get get ahead. That's when why Refi can help refinancing to a low fixed rate loan built just for you. Find out [e-mail] Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[Jade Warshaw]

Okay. Today's question comes from Shannon in California. She says, my husband and I disagree and we'd like for you to weigh in. Dave and Jade. Our son is 15 and recently got his first first job. My husband wants him to put the majority of his money into a Roth IRA and take advantage of all that compound growth. While I don't hate this idea, I think it's better for my son to invest his money in something accessible for college or a home down payment in the future. Our Son is open to both options. Which would you choose for your child? And if you prefer the savings option, where would you invest it? Okay, yeah, I tend to agree more with it sounds like the wife, however, with a couple of changes. So I'm going back to when I was 15 years old. I was working at Kroger. It's a grocery store. If somebody said, hey, Jade, you got to take all of this paycheck and invest it, I would lose all motivation in that moment to keep working and bagging groceries at Kroger. So there's part of this where you do want them to do the three things that we talk about with money. You want them to give some, you want them to save some, and you want them to be able to spend time some. Some. So I never heard you talk about him being able to spend any of this. So that needs to be part of it, as well as the giving component. And then with the. The amount that he chooses to save. Yeah, I'm with you, Shannon. I would keep it liquid in just a savings account because, yeah, you're right. College is coming up. Maybe he's gonna want to purchase his own car. You didn't mention a car. So there's just a lot coming up on the horizon that you're going to want your hands on that cash. And it's less than a five year play, which is why I wouldn't invest it. It's college. It's, you know, planning for whatever those costs are. It's. It's planning for him hanging out with his friends, he. Him having an emergency fund, all of that. So, yeah, I'd keep it liquid in a savings account. And don't be too much of a. A drill sergeant with this money. Let him enjoy some of it.

[Dave Ramsey]

Yeah, so mathematically, here's where you're making a mistake. Both of you think this matters. This 15 years old, he's not going to be making that much money.

[Jade Warshaw]

I mean, what's he making, 100 bucks?

[Dave Ramsey]

98% of what this kid needs to take from this is the lesson. 2% is the actual investment decision. If he can learn to live with a plan, he can learn to work hard, make some money, put it to a plan, spend it some of it wisely, be generous with some of it, and invest some of it. You have laid the groundwork for the young man to become a multimillionaire. It's the lesson that matters. The reason that you buy groceries at KRoger when you're 15 is not because there's money in it. Cause there's not any.

[Jade Warshaw]

No, it's because you want to go with friends.

[Dave Ramsey]

You learn. You learn to work. You learn. Work is where money comes from. And the first time you get a check and they see how much taxes come out of it, you know how to vote after that.

[Jade Warshaw]

I know that's right.

[Dave Ramsey]

Golly, you know, I mean, gee, and so on. So you learn to work. Work is good. But you're not really teaching. You don't really. A teenager is really not working because the result of the work is going to change their lives. No, the groove that drops into their brain called work ethic, the neuroscience of it that resides there for the rest of their life, that's what changes their life. And so we're teaching them to work. Whether you get an A on your term paper in the sixth grade or you get a baby matters not at all in the scope of your life. What matters is what did you learn during the discipline of not waiting till the last night to write the term paper, of putting, you know, doing the academic rigors of putting the paper together properly, to footnote it properly so that you learn not to plagiarize and you learn how to, you know, but the actual difference in the A and the B doesn't. What matters is did you do the work to get there? Because honestly, no one has ever gotten hired or fired based on whether they got an A versus a B in the sixth grade ever. But some parents act like it. Some of your parents lose your freaking minds on this stuff. So don't major in minors, major in majors. So the money from this 15 year old doesn't matter. What matters matters is he's learned to work, he's learned to give, he's learned to save and invest. And you can put it in a Roth if you want to. You put it in college if you want to. I tend to agree with Jade. Let him put it towards college and make sure we get through college debt free. That's a better investment than a Roth. If you pay cash for your education, whatever form of education he chooses to engage in, and he puts some skin in the game on that, I think that's a value much more valuable than the actual 12, 14%, whatever it is you're going to get on your mutual funds in your Roth ira. Now, having said all of that once he's doing all of that, if you guys have some extra money and you want to file a tax return on the money that he earns and you pay the taxes, if there's any taxes due there probably won't be. And then you file and open an ira. Yeah, I did that on the kids, but it didn't cost the kids anything. I just had some extra money. And so Rachel Cruz made twelve $33 babysitt, walking dogs, and whatever else she did working at Lululemon or whatever it was she did. And we filed $1,233 tax return, put $1,233 in a Roth IRA when she's 14 or 15 years old. Okay. And did that at 16, did that at 17. But that wasn't. That wasn't her money. That's just because she had some earned money that gave me an opportunity to put some money in her name. Now, that was fun. And the result of that, when she was 25, that'll do something pretty that's worth doing. Yeah, but it's. It's not like the 15 year old became wealthy based on their income and investment strategy. They don't. They don't make enough. There's not a money involved here for that to matter. What really matters is the lesson and building those muscles. That's very cool stuff. Shane is in Detroit. Hi, Shane. How are you? Oh, got a bad connection. Try one more time.

[Caller]

I'm doing well. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So I'm recently homeless. My car just got repossessed, which was my house, and I'm. I've got like 300 saved up. I was wondering, what would you do to just get yourself back up on your feet?

[Dave Ramsey]

How'd you end up living in your car?

[Caller]

I was in foster. I don't really have family or friends, so I was with Mike's fiance and then we broke up.

[Jade Warshaw]

Okay. How old are you?

[Caller]

23. I turned 24 in August.

[Dave Ramsey]

You're. You're what?

[Jade Warshaw]

23.

[Caller]

23.

[Dave Ramsey]

23. Okay. What, are you working at all?

[Caller]

No, my job went under. They lost their contracts, and I've been applying. I have about 200 job applications out. Not really sure why nothing's calling, but again, I have no car, so I don't have a way to get to these job applications either.

[Jade Warshaw]

Where are you right now?

[Caller]

I'm couch surfing at the moment.

[Jade Warshaw]

Okay.

[Caller]

Right now I'm in a buddy's house for the next few days, and then I'm going to be headed north to be staying with another buddy's house for a couple of days, and from there I'm not sure.

[Dave Ramsey]

Okay. All right, so the first thing I need you to do is I need you to get plugged into A strong community that can help you walk through this time. So I want you to find a good local church in the area that you're going to land in, whether it's this buddy's house or the next buddy's house. And you need to define how long you're able to surf their couch. Okay. So that you're not overstaying your welcome, but you're also taking full advantage of their generosity. Not in a manipulative way, but you're able to use that. So I want you to plug into a good church and let the pastor know at that church that you've aged out of foster care and what you're facing. Okay? And if you'll hang on, we'll hook you up with a church in that area where you're going to be. And then, yes, we have to get a position of some kind. And it's probably not about filling out applications. It's probably about connecting to a human to actually get a new job, start earning some income. Income, get $1,000 beater car, earn some more income. Get a one bedroom apartment, earn some more income and then begin to work on your career. We got to get sustainable first. Hang on. Our team will pick up and we'll guide you. Son, our scripture of the day, remember the Lord your God, for it is he who gives you the ability to produce wealth and so confirms his covenant, which he swore to your ancestors, as it is today. Deuteronomy 8:18. Earl Wilson said, ben, Benjamin Franklin may have discovered electricity, but it was the man who invented the meter who made the money. Oh, that's pretty good. If you're feeling stuck and overwhelmed with your money, you don't have to stay there. The total money makeover is the crash course that helps you learn the Ramsey plan, how to beat debt, build wealth, and take control. It walks you through the seven baby steps. In plain language, it's fast, it's clear, read. Most people finish it in a day. Over 10 million people have picked it up and it's helped them finally get it. Get your [e-mail] store or click the notes in the show. Click the show notes. If you're on YouTube or podcast, Carlos is in Melbourne, Florida. Hey, Carlos, how are you?

[Caller]

I'm doing good, Dave, how are you doing today?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Hey, I am calling in. My wife and I are expecting our first daughter to be born any day now.

[Dave Ramsey]

Wonderful.

[Caller]

Yes, very exciting. And we have about $6,000 in a savings account that we've been stowing away and are planning on using that for the cost of birth and any unexpected things that may come along with that. We're.

[Dave Ramsey]

How much is insurance covering?

[Caller]

We're going to find that out. We should have met our deduction through all of the prenatal screens and things of that nature.

[Dave Ramsey]

So as we move forward, we're ballparking.

[Caller]

Based on her co workers, we're on.

[Dave Ramsey]

Her insurance and what some of her.

[Caller]

Co workers who have recently had kids have said to expect around 5,000, maybe some more. I know it'll be different with each.

[Dave Ramsey]

Situation, but that's kind of what we're.

[Caller]

Ballparking, where we'll be able to spend. Spend the 5,000 and then still have a little bit of money saved afterwards if all goes well. The reason I'm calling is because I have five. I have 17,000 in my 401k and I know that we're able to withdraw from that 401k penalty free. It'll still go on taxes as taxable income. Them. I've done the research and it won't change our tax bracket if I do take the $5,000 out of the 401k.

[Dave Ramsey]

Nope. No. No. Absolutely not. Even as a absolutely not peace of mind? No. Okay, so my wife was right again. No.

[Jade Warshaw]

Yeah, she was right again.

[Dave Ramsey]

Now what's your household income?

[Caller]

We take home about $7,000 a month.

[Dave Ramsey]

Okay. Just rebuild. Just rebuild your emergency fund as f you can if you have to use some of this money for. If the insurance doesn't cover it. If the co worker version of the estimate was right. I don't like that methodology for discovering how much you're going to earn or how much you're going to owe. I think I would just rather talk to the health insurance company and find out what my deductible is and what my copay is and what my max out of pocket is and see how far up the ladder you are on that. Because you might get actual information, real information information and find out it's $3,000 and then this whole discussion was for nothing.

[Jade Warshaw]

Mm.

[Caller]

Okay. Got it.

[Dave Ramsey]

Yeah, we don't. You. I don't use co workers who are broke people as my guideline for much of anything.

[Caller]

Okay, got it. And you feel that maybe if it.

[Dave Ramsey]

Is less, whatever the case may be, everything will be all right.

[Caller]

I don't need to take out.

[Dave Ramsey]

Let's pretend it's 8,000. Okay? You take the 6,000 out and you pay. Pay it towards the eight and you cover the other two out of your $7,000 a month income first.

[Jade Warshaw]

Finding out what your deductible or out of pocket max is. Sometimes it's the same number, sometimes it's different. But knowing that, I mean, and prepping for that, that's what's going to give you ultimate peace of mind.

[Dave Ramsey]

Yeah. Congratulations on the new baby, by the way. And the great news about that is, is it makes you get very serious. Some people. Most. Most people. About getting your crap together.

[Jade Warshaw]

Yeah, it does.

[Dave Ramsey]

I mean, you really start. You start saving, you start getting out of debt, you start living on a budget, you start being like grownups and stuff. Because a shocking thing I'm responsible for. This helpless little small person will wake your butt up, man. It's pretty amazing. I love it. Jessica is in Santa Barbara, California. Hi, Jessica. How are you?

[Caller]

I'm doing great, thank you. And I'm so happy to be able to talk to you.

[Dave Ramsey]

You too.

[Caller]

So the situation is we just listed our home for the sale. We listed it for 2.4 million. We had an offer come in within an hour of it being listed for 1.8.

[Dave Ramsey]

Well, that's kind of useless.

[Caller]

I know, right? Well, so here's the story. We have a $216,000 mortgage, a $45,000 HELOC, 50,000 soldiers, solar system. So 311,000 against the house.

[Dave Ramsey]

And then why are you selling the house?

[Caller]

We're selling the house. My husband is 73, I'm 61. And it's like money is always an issue, always just arguing about it, fighting about it. My. I have a 17 year old and a 20 year old. They're always hearing my husband say, I can't afford.

[Dave Ramsey]

Why is that? Why does that cause a sale of. Of the house?

[Caller]

Because we can't really afford. We're living off of his disability income.

[Dave Ramsey]

So you're going to move to a cheaper area?

[Caller]

That's what I think we need to do. Yeah, we need to.

[Dave Ramsey]

I mean, is that why you're selling the house?

[Caller]

We're selling the house because. So we've been living between British Columbia and Santa Barbara, using the house in Santa Barbara as a resident to supplement the other house and the children's education. So it's just kind of this mess. Like it's working, but it's stressful and it's really tight financially.

[Jade Warshaw]

What's your income? What are you guys living on every month?

[Caller]

We're living on his disability, which is 4,000, and Social Security, which is 1,800. And then whatever I can get from the Airbnb, which is averaging about 6 to 8,000, but it's just dried up.

[Jade Warshaw]

And do you have a nest egg? Do you have retirement?

[Dave Ramsey]

So why did you list it at 2.4? Did somebody tell you it's actually worth that or you were just hoping.

[Caller]

Yeah, yeah. No, it. Well, they said it's worth. It's listed on Zillow is like two point.

[Dave Ramsey]

I don't care what Zillow said. Why do you think it's worth 2.4? Do you really think it's worth that?

[Caller]

I didn't necessarily. My husband is a realtor. He did. I mean, he's retired. And another. The person he co listed with feels it's worth it. It's an expensive area.

[Dave Ramsey]

Okay, but. So if it's worth 2.4, then 1.8 is A, an insult.

[Caller]

Right.

[Dave Ramsey]

So we counter it at 2.399.

[Caller]

Okay.

[Dave Ramsey]

Just to let them know that we think they're smoking crack.

[Jade Warshaw]

How long has it been on the market?

[Dave Ramsey]

One day.

[Caller]

Literally five hours.

[Jade Warshaw]

Got you. Okay, I missed it.

[Dave Ramsey]

Okay, so I'll give you. I'll give you a quick nope. If I'm. If I'm the buyer, if I'm the seller and I'm not desperate and I'm not freaked out and I haven't overpriced the house, if the house is actually worth this, which I can't tell from this conversation, if you have any clue, to be honest with you, I'm not sure any of you people have a clue in this conversation. Your husband, a former real estate agent who doesn't do anything. You running an Airbnb half the but and running back and forth between B.C. and Santa Barbara. Oh, my God, what a run. And you got a co listing agent who maybe sold one house last year. So I'm not sure anybody in this whole pile knows what you're doing in terms of pricing houses, but if you're accurate on your 2.4, then I'm going to counter that at a ridiculous 3.9999 just to let that 2.3999. Just to let them know that their 1.8 is ridiculous. Ridiculous. But it may give you an opportunity to get to the bottom of what the house is actually going to appraise for in its current condition. Regardless of the story, regardless of the history, regardless of your wishes, nothing works there. What's the house really worth? If it's worth 1.8, take their offer and you're done. And you move on. And use this as a time to get some cleanliness back to this chaos. That you just describ described because it sounded very disjointed to us on this end.

[Jade Warshaw]

It didn't sound good at all.

[Dave Ramsey]

Sounded kind of scary. So. And if you think a million dollars in your pocket is going to solve that. No, that million dollars be gone about 32 minutes. Not going to solve it. That puts us out with the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of peace, Christ Jesus.