Life Gets Easier When You Don't Owe Anyone

Summary

The Ramsey Show – "Life Gets Easier When You Don’t Owe Anyone"

Date: July 9, 2026
Hosts: Dave Ramsey, George Kamel Ramsey
Theme: Overcoming financial obstacles, building wealth, and strengthening relationships through intentional money management

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Episode Overview

In this value-packed episode, Dave Ramsey and George Kamel take calls from listeners struggling with debt, relationship conflict over spending, questions on retirement savings, car loans, home buying, and more. Through real-life scenarios, the hosts centralize the core Ramsey themes: personal responsibility, intentionality with money, and the importance of unity (especially in marriage) for lasting financial peace. Key takeaways include actionable advice, memorable analogies, and encouragement for fresh starts, regardless of past mistakes.

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Key Discussion Points & Insights

1. Financial Conflict in Marriage (00:51–08:55)

• Caller Hannah’s Dilemma: Hannah is “on Baby Step 2” but hides money from her spender husband due to his dismissive attitude after a big income increase.
• Dave’s Analogy: “You can't hide the liquor under your bed to keep your husband who drinks too much from drinking. You have to address the drinking problem.” (01:54)
• Advice: Financial misalignment is a behavior and marriage issue—not just a tactical problem. Both hosts strongly recommend marriage counseling to build mutual respect and intentionality.
  • “It takes two emotionally mature and healthy adults to follow a plan and do it together.” – George (05:37)
  • “Personal finance is 80% behavior, only 20% head knowledge.” – Dave (07:00)

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2. Should You Use Home Equity to Pay Off a Car Loan? (10:14–14:10)

• Caller Alyssa: Considers refinancing her home to pay off a $15,000 car loan on a $40K household income.
• Dave: Strongly advises against moving debt around. Instead, sell the car, buy a cheaper one, and use payment amounts to upgrade cars over time.
  • “You're not paying off the debt, you're just moving it.” (10:44)
  • “Sell it, buy a $9,000 car and not have any payments, then pay yourself payments and move up to better cars.” (11:51–12:17)
• Takeaway: Break the car payment cycle and get on a budget for lasting change.

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3. Student Loan and Career Considerations (14:10–19:16)

• Caller’s Husband: Has $47K in student loans but didn’t finish a degree in video game development.
• Hosts: Discuss the value of degrees versus marketable knowledge. Dave humorously admits, “I am officially an out-of-touch boomer.” (15:19)

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4. Investing for Young People & Future Planning (16:14–20:07)

• Caller Gideon: 19-year-old asking about rolling over his 401k and starting an IRA.
• Dave: Focus first on graduating with a debt-free, marketable degree. Investing comes after securing earning potential.
• George adds: Parents should teach their kids to critically engage with the world—mentioning news resources for preteens/teens (20:07).

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5. Giving With Intention & Generosity with Integrity (23:14–30:33)

• Caller Sophie (Brooklyn): Wants to transition from “check-the-box” giving to deep, intentional generosity.
• Dave:
  • Give to causes that “make your heart beat”—find alignment with values and make sure the charity operates efficiently.
  • Split giving into three buckets: auto-giving, causes that move you emotionally, and spontaneous acts.
  • “The random acts are actually the most fun because you're right there in the face of the thing.” (29:30)
• George: Getting directly involved with causes makes generosity more tangible and meaningful.

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6. Debt Free Legacy at End of Life (32:53–34:15)

• Hospice Chaplain’s Story: Helped a terminal patient reach Baby Step 4 before dying debt-free.
  • “The peace she felt knowing she was not leaving debt behind was profound.” (32:53)
• Reflection: Freedom from debt leaves a powerful legacy and dignity, even in one’s final months.

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7. Is 20% Down Payment on a House Mission-Critical? (34:22–42:31)

• Caller Taylor (Orlando): Wants to know if he needs to wait until he has a 20% down payment.
• Dave: 20% avoids PMI but is not required; most first-time buyers put down less with a 15-year fixed loan.
  • “Most first-time home buyers…put down 5% or 10%.” (36:52)
• Warning: Don’t co-buy a house unless you’re married. (39:52)
• On 15 vs. 30-year mortgage: 97.3% of 30-year borrowers don’t pay it off like a 15-year; discipline is key.

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8. Keep Retirement and College Savings in Perspective (43:45–49:50)

• Caller Maria: Weighs different college savings options post-529 plans.
• Hosts: 529 plans are superior for college savings due to tax advantages and flexibility over other new “Trump Accounts.”

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9. Debt-Free Milestone: What’s Next? (50:11–51:27)

• Jonathan (Jackson, MS): Paid off $62K in debt—asks about joint retirement accounts.
• Dave: IRAs are always individual accounts but can name each other beneficiaries; coordinate investment strategies as a couple.

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10. Finances in Second Marriages and Unity (53:50–62:54)

• Trudy (Los Angeles): New marriage, husband wants to keep finances separate due to her debt.
• Hosts: Stress the importance of unified financial decisions in marriage.
  • “If he has to be protected from you, he shouldn’t have married you.” – Dave (55:01)
  • “There's a lot of unity and excitement of just going, we're going to build wealth together…” – George (60:35)
• Dave reflects: The healthiest couples combine finances and make decisions together.

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11. Debit Card Security, Fraud, and Credit Card Myths (76:29–85:25)

• Listener Michael: Asks about debit card safety.
• George: Recommendations for Apple Pay, virtual card numbers, and regular account monitoring.
• Dave: Debit cards have the same zero liability fraud protection as credit cards. The key is vigilance and using built-in tools.

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12. Are We Over-Contributing to Retirement? (86:06–94:08)

• Caller Mike (San Diego): Wondering if he’s locking up too much money in retirement accounts versus having liquid investments.
• Dave: If you want flexibility before 59.5, balance brokerage (after-tax) accounts with retirement accounts. Monitor, but you’re in great shape.
• Quote: “You could limit [retirement contributions] for a little while and get that after-tax brokerage up, then start that plan.” (93:28)

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13. Net Worth as the True Measure of Financial Success (95:31–104:40)

• Dave & George: Announce new net worth calculator and urge listeners to focus on increasing net worth, not FICO scores.
  • “The FICO score requires your emotions be immature. Net worth requires your emotions be mature.” – Dave (102:13)
• Memorable Analogy: “The banks have taught us thoroughly—what’s in your wallet? Not your card. My money!” (98:23)

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14. Fresh Start After Divorce – To Sell or Stay in the Home? (106:08–114:17)

• Caller Jennifer (Philadelphia): Newly divorced; unsure if she should sell the home and pay off all debt for a clean break.
• Dave: Recommends the fresh-start approach: sell the home, pay off debt, embrace “chapter two” and new possibilities.
  • “Your life becomes a new adventure after this tragedy and this heartbreak...” (108:30)
  • “People either treat it like a comma or a coma. You get to choose.” – George (114:19)

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15. FAFSA, College Aid, and School Choice (117:29–125:42)

• Caller Danielle: Unsure if she should reduce family savings to improve financial aid odds.
• Dave & George: Don’t "act" poor for need-based aid. Focus instead on scholarships, affordable school choice, working in school, and teaching kids responsible habits.
  • “The only thing more worthless than your degree is where you went to school.” – Dave (123:26)
  • 54% of college starters actually finish—a caution against “almost degrees.”

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Notable Quotes & Moments

• “Personal finance is 80% behavior, only 20% head knowledge.” (07:00, Dave)
• “If he has to be protected from you, he shouldn’t have married you.” (55:01, Dave)
• “Most first time home buyers…put down 5% or 10%.” (36:52, Dave)
• “The FICO score requires your emotions be immature. Net worth requires your emotions be mature.” (102:13, Dave)
• “You can’t hide the liquor under your bed to keep your husband who drinks too much from drinking. You have to address the drinking problem.” (01:54, Dave)
• “People either treat it like a comma or a coma. You get to choose.” (114:19, George)

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Timestamps for Major Segments

• Marriage & Money Conflict: 00:51–08:55
• Car Loan Payoff & Selling: 10:14–14:10
• Retirement & Student Loan Questions: 14:10–19:16
• Investing for Young Adults: 16:14–20:07
• Intentional Giving: 23:14–30:33
• Debt-Free Legacy: 32:53–34:15
• Home Buying (Down Payments): 34:22–42:31
• 529s, College Savings: 43:45–49:50
• Financial Unity in Marriage: 53:50–62:54
• Debit Card Safety: 76:29–85:25
• Retirement Contributions Strategy: 86:06–94:08
• Net Worth Focus vs. FICO: 95:31–104:40
• Fresh Start After Divorce: 106:08–114:17
• FAFSA, College Aid, and School Choice: 117:29–125:42

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Conclusion

This episode delivers both practical financial strategies and deeper advice on relationships, integrity, and emotional maturity with money. The recurring message: Lasting wealth and peace come when you’re debt-free, intentional, and unified in your life and relationships. Whether paying off debt, planning for a fresh start, or navigating family finances, Dave and George provide clarity, humor, and encouragement to keep listeners on track toward financial freedom.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fair Winds Credit Union Studio, this is the Ramsey Show. I'm Dave Ramsey, your host. George Camel Ramsey, personality number one best selling author and host of co host of the Smart Money Happy Hour. He is my co host today. Open phones at 888, 825-5225. Hannah is with us in New York, Syracuse, to be precise. Hey, Hannah, what's up?

[Caller]

Hi. How's it going?

[Dave Ramsey]

Better than I deserve. How can we help?

[Caller]

Yep. So my husband and I are on baby step two and I have a husband who is way more of a spender than I am. And it's gotten to the point we started the plan in January and it's gotten to the point where I am now having to put money aside in a savings account, diverting it from my paycheck because if I don't do that, he ends up spending it and it's become very.

[Dave Ramsey]

How old is this child?

[Caller]

He's 33.

[Dave Ramsey]

Okay, does he actually have a psychological disorder or is he just immature?

[Caller]

So our income has. Two years ago we were close to, I want to say 125. And in the past year and a half our income has gone up to 275 a year. So there's been this massive shift in the amount of money coming in. And whenever we talk about it, he's very dismissive of it. He feels like it's fine. We make plenty of money and you know, we'll pay the debt off eventually. So we've never been able to get on the same page with that. And that's, that's what I'm calling.

[Dave Ramsey]

Okay, Well, I mean, you can't hide the liquor under your bed to keep your husband who drinks too much from drinking. You have to address the drinking problem. And so this is a behavior problem and a marriage breakdown. And there's not a tactical step that you can do to fix that. And so it's got, you know, if I were in your shoes, I'm going to force the issue because I disagree. I've tried. I worked at it really hard. I tried to out earn my stupidity. I'm really good at making money and I never was able to make enough to be or my income was bigger than my stupidity. Congress is trying it. They're not able to either. And your husband isn't able to either. And so the Arrogance that goes with that, that says, oh, I make a lot of money, I'm bulletproof. I've experienced that. I've looked at that idiot in the mirror. I know what he looks like, looks like me. And so it doesn't work. It's not practical, and it's not addressing this lack of self discipline. It's like, okay, I'm in good shape and so I can eat whatever I want to eat and get fat. You know, that doesn't make sense. You know, it's like, no, that's not where the good parts of life come from. They come from learning to delay pleasure for a greater good. Not just being hedonistic and buying anything I want to buy whenever I want to buy it, and pushing, filling up my card on Amazon and hit submit, submit, submit, submit, and think that's where happiness is found. Instead actually achieving some goals. Now you don't have to live on beans and rice if your income's gone way up. Maybe there's some things you can do depending on how intense you want to be on things, but you need to at least be intentional. And when you're panicking to the point that his behavior is this bad, that you have to, quote, hide the liquor bottles under the bed, it doesn't work. You're still going to get drunk,

[Caller]

right?

[Dave Ramsey]

So you guys need to see a marriage counselor, okay? If he's the answer, if he's dismissive of you to the point that your vote doesn't count and he can't hear this concern and address the concern and come to some kind of mediated point where, okay, we are going to spend some money, but I'm willing to write down and agree to the money we're going to spend, then that's fine. I mean, in today's world, Sharon and I can buy most anything we want to buy, but we still don't without A, talking to each other and B, making it part of a holistic plan. And so right now you've got our

[George Kamel Ramsey]

money, but it's his plan. He does what he wants. It's not our plan. You guys never aligned on this. It sounds like you never were aligned with your financial values. You value being debt free and he doesn't give a rip.

[Dave Ramsey]

And the extra income can gloss over the cracks that are in what's going in the relationship and in how he's treating you and even how you're treating him. And so instead, okay, I want to treat you in a place of honor and respect. And the only way I can feel comfortable doing that is that we are being mature about how we're handling this. And I don't feel like we are to the point that I'm wanting to hide money from you. That's weird. You know, you really have to address this.

[George Kamel Ramsey]

Yeah. The problem is it takes two emotionally mature and healthy adults to follow a plan and do it together. It's really hard to do it alone. You can kind of drag the other one through it. You can try to do it on your own, but man, it's going to be a grind.

[Dave Ramsey]

Yeah. And we just don't, you know, all the data that we've got now from having done this for 45 years, this coaching people, the data is pretty thorough. And the data tells us if you want to have a high quality, long lasting, sustainable marriage, a quality marriage, not a perfect marriage, but one where we introduce conflict and we resolve it and we're aligned to certain values and we like each other as a result. And we want to hang out. Not only love each other, but we like each other and we want to hang out together. But that takes work and alignment and constant adjustment. And that's why we admire people that have been married 50 years and didn't kill each other. You know, it's like you did. How did you do that? Because I think I'd be dead by now. You know, it's like. Right. And so, you know, and the same thing with wealth. We don't see people building wealth. I mean, again, very often. But statistically the data says that couples that work together, very high probability of actually becoming wealthy. And the couples that don't work together and have to hide the liquor bottles under the bed, the target bags under the bed, or hide the money in a savings account because my husband, who makes $275,000 a year, can't seem to be a grown up enough to limit his spending. Then you know, those couples don't succeed financially or relationally in the data. And so that's what we want for you guys. Hannah, we love you and we want you to win. And so we want you to go all the way to the source of this down into of this thing and clean it up. That's the problem with this. That's why the show has been so popular for so many years, is it's not really about one plus one equals two or ten plus ten equals 20. It's personal finance. And so we get to deal with all of our trash that all of us have. And George and I are authentic and tell the truth about our own stuff. And Rachel is All the people that are on here, all the Ramsey personality, it's one of the things we do is just go, hey, this is a human problem. It's not a math problem because it's personal. Finance is 80% behavior, only 20% head knowledge. So relationships and how you function in them, huge indicator.

[George Kamel Ramsey]

If you add more people in, it multiplies the drama, the complexity, the emotions around it. So you really need to be aligned in order to win.

[Dave Ramsey]

Oh, wait, you're saying children throw fits and want stuff.

[George Kamel Ramsey]

Yeah, the tantrums aren't going to help, especially when it's coming from a grown adult. That makes it even more difficult.

[Caller]

Foreign.

[George Kamel Ramsey]

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[Dave Ramsey]

Alyssa is in Manchester, New Hampshire. Hi, Alyssa. How are you?

[Jade Warshaw]

Good.

[Caller]

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

I just have a question regarding taking a loan out against the house. Would it be smart to do that refinance in order to pay off $14,000 worth of car? What? We own the car.

[Dave Ramsey]

Absolutely not.

[Caller]

Because we're just accruing more debt, right?

[Dave Ramsey]

Yeah. You're not. You're not paying off the debt, you're just moving it. So what is your household income?

[Caller]

40.

[Dave Ramsey]

Okay. And you owe $15,000 on this car?

[Caller]

Yes.

[Dave Ramsey]

What's the other car worth?

[Caller]

We only have one car.

[Dave Ramsey]

Okay. And what's the interest rate on this?

[Caller]

I think it's six.

Okay.

[Dave Ramsey]

That's not too bad. I was afraid you were going to tell me?

[Caller]

18?

No, no, no.

[Dave Ramsey]

You only have one car?

[Caller]

Yes.

[Dave Ramsey]

And what's the car worth?

[Caller]

I think it's worth 24,000.

[Dave Ramsey]

And you owe 15 on it.

[Caller]

Mm hmm.

[Dave Ramsey]

And you, your household income is 40?

[Caller]

Yes.

[Dave Ramsey]

Well, what I would do is sell it and buy a $9,000 car and not have any payments.

[Caller]

Okay.

[Dave Ramsey]

And then I would. With no payments. How much are your payments?

[Caller]

There are 470amonth.

[Dave Ramsey]

Okay. And then for the next 10 months, I would pay myself a payment. 11 months, and I'd have $5,000 and I'd go buy another car so that we had two paid for cars, a $9,000 car and a $5,000 car and no payments.

[Caller]

Actually a good idea.

[George Kamel Ramsey]

Do you see how that just broke the cycle of payments in your life?

[Caller]

Yes.

[George Kamel Ramsey]

Pretty incredible.

[Dave Ramsey]

Now here's the thing. You don't have to panic because you're not about to get repoed. You don't have to give the car away. I want you to get $24,000 for it. I don't want you to sell it for 19,

[Caller]

okay?

[Dave Ramsey]

Because you need that nine so that you get a good car as your main car. And then while you're driving that good $9,000 car, then you get, you save up and get a $5,000 car. And here's the fun thing. It's not necessarily how life works, but from a math riddle perspective, if you just want to say, like those old. Remember your prop. They may not have had them when you were in school. When I was in school, they had math word problems, and we had to solve the problem. They told a little story and you had to solve the math problem inside it. And so make it kind of into a math word problem and say, all right, if we had a $5,000 car 10 months from now, that was in a $9,000 car 10 months, it was paid for 10 more months from now, we could sell the $5,000 car for 5,000 and put 5,000 cash with it and have a $10,000 car. And 10 months later, we could move the 9,000 up to A. Or 14 months later, we can move the 9,000 up to a $15,000 and we could have a $10,000. And you know, if you map that out and kind of play it out, that's about 36 months I just outlined there. And three years from today, you could be driving a paid for $15,000 car and a paid for $10,000 car. If you just keep paying yourself one car payment of 500 bucks a month, but you're already Paying somebody else that car payment. But you're going to have to be on a budget to do that. Because once you don't have to pay the bank to avoid repo, it's harder to save money than it is pay payments discipline wise.

[George Kamel Ramsey]

I'm curious, do you guys have any other debt?

[Caller]

We have school loans. My husband has school loans. Carlos, how much? We have about. I want to say it's 47,000.

[George Kamel Ramsey]

Is he the only income in the house right now?

[Caller]

I do get a disability, but he works at the post office. Yes.

[George Kamel Ramsey]

What was his degree in?

[Caller]

He didn't end up graduating.

[George Kamel Ramsey]

What was he pursuing at the time?

[Caller]

Video game development.

[George Kamel Ramsey]

Well, the income is the other lever to pull here because these student loans, they're going to be hanging around. You can't get rid of these things.

[Dave Ramsey]

You can get a degree in video game development.

[Caller]

Apparently so. Yes.

[Dave Ramsey]

He didn't. But people can.

[Caller]

Yes.

[Dave Ramsey]

Wow.

[Caller]

Yeah.

[Dave Ramsey]

Like a four year degree.

[Caller]

Four years. Yes.

[Dave Ramsey]

Okay.

[George Kamel Ramsey]

Someone's gotta make them.

[Dave Ramsey]

I am officially an out of touch boomer. Just put me in the category. Just put me in the boomer bucket. I never thought I'd see the day.

[George Kamel Ramsey]

I'm sure it's a newer degree, but you can make good money doing it.

[Dave Ramsey]

You'll have to. I knew that. I thought it was just somebody that kind of was self taught techie.

[George Kamel Ramsey]

Yeah. That like a developer who went, oh,

[Dave Ramsey]

I can figure out somebody that played Call of Duty so much that it became their duty or something. I don't know. I mean I just thought it was kind of learned that way. I didn't think it was. I didn't know there was actual four year freaking degree. I wouldn't be surprised that a technology place maybe had a certificate or something in it. But I'm a little shocked that somebody's actually offering a four year degree in video game development. It is a big industry. I guess it's logical. It's just. It shows how out of touch I am. That's what. How irrelevant I am. All right. Gideon's in Phoenix. Hi Gideon. What's up?

[Caller]

Oh, nothing too much. How are you doing?

[Dave Ramsey]

Better than I deserve. How can we help?

[Caller]

So I've got. I'm a college student. I've got an employer sponsored IRA. 401k. Excuse me, I'd like to start a personal IRA because I won't be as this job forever and I'll need to roll the 401k into my IRA. How would you recommend I go about doing that?

[Dave Ramsey]

Well, your rollover IRA will be different than The IRA that you add to, there'll be two different account numbers. Rollover account numbers don't technically combine with individual IRAs that are opened. Does that make sense? But if you are interested in doing some investing and you want to learn about that, you could get in touch with one of the smartvestor pros that we recomm in. It's really not that big a deal. It's not that hard. I mean, have you ever opened a bank account?

[Caller]

It's been a while, but I think so.

[Dave Ramsey]

Okay. How old are you?

[Caller]

19.

[Dave Ramsey]

Okay, well, it's about as much paperwork, plus a little bit of opening a bank account. Like if you go open a checking account or you go open a savings account, you have to fill out four or five pieces of paper and, you know, put your social down four or five times and that kind of thing. And it's like, you know, they, they. And then poof, you have an account. And the same thing's true of opening an ira. See, an IRA is technically an investment. You're actually picking a mutual fund. In this case, that was what we're recommending to put the money in. And the IRA is the blanket. The Individual Retirement Arrangement is what it stands for. The blanket that wraps around the mutual fund and keeps it warm from taxes. The IRA itself is not an investment. It's how the investment is treated for taxes. And you want to make it a Roth so that it grows tax free. What year of school are you in?

[Caller]

I'm going into my. Well, it's kind of weird. I did some dual enrollment, so I'm technically a sophomore. But because I did classes early, I'm also technically a junior.

[Dave Ramsey]

Okay. And so what are you studying?

[Caller]

I'm getting my Bachelor of Biblical Studies in Admissions from Crown College of the Bible in Tennessee.

[Dave Ramsey]

Good. And how are you paying for all of this?

[Caller]

I'm working through it. Working through college. My parents are helping a little bit, but I'm working mostly.

[Dave Ramsey]

Good for you. Good for you. Well done.

[George Kamel Ramsey]

Do you have a Roth option with your employer for that 401k?

[Caller]

I don't believe so. It's just a 401k. I put in 3%. They match, that's all.

[Dave Ramsey]

Okay. That's okay. Let me back up three steps and say before you did a 401k and before you did an IRA, my first concern is that you graduate with a degree that is usable in the marketplace, that you can go get a job and make a living with that set of information, and that you pay cash for that degree. If you do that. That is a better investment than a mutual fund.

[Caller]

Yes, sir.

[Dave Ramsey]

Knowledge is the tool tools in the tool belt, not the degrees, but the knowledge in your tool belt is what makes you set you apart in the marketplace. And you will be worth more than that mutual fund will be ever. So I'm more concerned that you do that first before you do either one of these other things. But if you're already doing that, then, and it sounds like you're on a ministry track, which is wonderful. Good. And then, yeah, have a, have a 401k. And if you want to add to that, in addition to an ira, that's good.

[George Kamel Ramsey]

As a dad of young kids, I'm starting to think a lot more about the world they're growing up in and how I'll help them make sense of it as they get older. And that's why I like World Watch, a video news service for preteens and teens. Because one thing I know for sure, if you don't teach your kids how to understand the world, somebody else will. And these days that could be TikTok, YouTube, Instagram, influencers, or whoever happens to show up in their social media feed. World Watch's 10 minute videos help young people understand what's happening in the world through a Christian worldview without all the outrage, negativity and noise that is everywhere these days. The reporting is factual, engaging and designed specifically for preteens and teens. And World Watch creates opportunities for something every family needs more of, meaningful conversations. Instead of just reacting to headlines, kids learn how to think about what's happening in the world. And parents get a chance to keep those conversations going at home. Because when my kids are old enough, I want them informed, not overwhelmed. And right now you can get a 30 day free trial. Just go to Worldwatch newsletter or use promo code Ramsey to get started. That's Worldwatch News slash. Ramsey.

[Dave Ramsey]

Ever feel like a rat in a wheel with your money where you just run, run, run, run, run, don't seem to get anywhere. If you reach the point on that that you're sick and tired of being sick and tired and you're ready to say, I've had it, then you start asking questions on this show and you start going, okay, Ramsey, what do I do to get from here to there? What is the shortest distance between running like a rat in a wheel and actually having some money? Where I'm actually controlling my destiny? Where I can retire with dignity and not have to eat Alpo at retirement because I counted on social insecurity? Hey, there's a Plan work your whole life and count on the government, which is well known for their ability to handle money, to take care of you. Well, that would be stupid. So once you kind of break through that stuff and you go, I don't think so, and you're ready, what's the shortest path? Well, we call it the baby steps. And we've helped millions, tens of millions of families become baby step millionaires by working through this process. And of course they do it with a plan and the plan is a budget and it's called EveryDollar. The EveryDollar budgeting app will hold your hand into a personalized coaching plan and help you find extra money to get out of debt, build wealth and become a baby steps millionaire. In 15 minutes you're going to find your first few thousands of hidden margin money that you're just pissing away and you can actually start doing something with it. Actually be a grown up and stuff and we'll show you how to do it. You can download every dollar for free in the App store or Google Play and then you could call here. We'll help you, but you won't really need to because it'll tell you the same exact stuff George and I are going to tell you. Sophie's in Brooklyn. Hi Sophie. What's up in your world?

[Caller]

Hi, Dave. Hi, George. Firstly, I just wanted to say how much I appreciate the way that your show and Ramsey, while being, you know, faith based and in values, is still inclusive and useful and relevant for those who maybe share all the same beliefs and values. I think that's rare in media today and after listening to your show for the last four years, I feel like I'm much more able and open to respect and appreciate the opinions of those that don't share those. So thank you not only for what you've done for me financially, but also so helping me become less of a dumb bigot.

[Dave Ramsey]

Wow, that was cool. What a great phrase. You're awesome. How can we help you?

[Caller]

So my question is around giving with intentionality and being generous with integrity. Currently my giving, it consists of three charities that I've selected based on sort of my values and things that are important to me and they're on automatic monthly debits. And it feels like I'm just of picking a box each month versus being intentionally generous. You know, as mentioned, I'm, I'm not mentioned but insinuated. I'm not part of a faith based community. But I love what I hear on the show about tithing. You know, this idea of giving to a community with shared values where you are both involved in and can tangibly see how those funds are used.

[Dave Ramsey]

Yeah.

[Caller]

I'm currently on baby steps four, five, and six, on track for seven in the next six months. And want to make sure that as I'm approaching know, becoming outrageously generous, I want to make sure I'm doing it with integrity and intentionality.

So I love.

I love that someone like me.

[Dave Ramsey]

And just an excellent.

[Caller]

How do you deter. Sorry.

[Dave Ramsey]

That's okay. It's an excellent question. Thank you. Thank you. Very, very well thought out.

[Caller]

Thank you.

[Dave Ramsey]

Okay, so what, as you said, what we're going to suggest is you find something that aligns with your values and something that. And honestly, it's something that kind of makes your heart beat. Okay. This thing matters to me for whatever reason. Either it's something in my history or something in my family's history, or I just care about it for some reason and it makes my heart because, you know, the weird thing is that not everything that's valid is gonna be yours to do. Some things that are valid, they're not yours to do, they're somebody else's. Cause they care about them. So I want you to find something that does do that. And then what we have done at Ramsey in the family, it started out with we were looking at that, and then we wanted to get a touch more sophisticated and really look into how that particular charity was operated. For instance, let's just say you were giving to something that was feeding hungry children. You were worried about food security. Okay. Then you would want to know that a high percentage of the donation is actually going to feeding a child, not the bonus plan of the president of the charity. And so you can. You can look at their books. If they will disclose them. If they won't disclose them, we don't give to them, okay? If they're ashamed of where their money is going, then we don't. Ramsey. Don't give to them. So if they're transparent, then I can look and I go, hey, you know, 10, 15% of their income goes for administration and salaries and overhead to operate the thing. And the other 85 or 90% or 75% or whatever goes to the actual thing, the drilling of the well to create the clean water for that community or whatever it is you're doing. Right. I don't want that flip flopped. I don't want 85% going to salaries and 15% going to the hungry kids. I don't want to give that $100. You follow me?

[Caller]

Right.

[Dave Ramsey]

So I'm looking at the way the things operate, how well it's operated. In our case, we don't give to ministries or charities that borrow money because that would be inconsistent with our family's belief. That would make us seriously hypocritical. Now, that wouldn't necessarily be true of you. You could decide if you want to do that or not. But I'm just saying that's one of the things we've decided. So then back to your original question. What we do is we set some things on autopilot, like that, where we're automatically giving just out of. Not necessarily because the thing is tickling us every month and tickling our heart and making us smile every month, but instead, we just want that rhythm of generosity to be there as a part of who we are as people, not as a part of the thing. Then that's one bucket. The second bucket is we do look for some things that make us cry, that when we give to it, we read the letter from the person later and we cry. And I really want some of those. And then the third thing we do is that we allocate a small amount, and some of it is a small amount relative. It's not a small amount, but it's a small amount relative to the total budget of the foundation. My daughter runs the foundation, and she's authorized to just randomly bless something. And I carry a pocket full of hundreds. And I may just randomly bless something. If I'm standing at the gas pump and I'm looking at a lady and her kid's clothing is not great and the tires on her car are bald. She's probably a single mom, 52% of which live below the poverty level. And God might speak to me and say, buy that lady's gas and roll her car over there and put some tires on her car. And I got enough money in my pocket just to go do that one. And those are so fun. That's the most fun you'll ever have because that's really in your face.

[Caller]

I remember listening to an episode where you shared that. And I also heard an episode where you said you were in Australia. I'm Australian. You love the Australian people. And I said to myself, if I saw Dave in a restaurant, I would be buying him dinners. They thank you.

[Dave Ramsey]

Oh, you're sweet.

[Caller]

I hate you. On the. On the random acts of.

[Dave Ramsey]

Yeah, but I mean. But the random acts are actually the most fun because you're right there in the face of the thing. The second most fun are the ones where you hear Back later and say, you know, we just did a huge fundraising event at our farm the other day for a sex trafficking interdiction organization. Meaning they send the ex military guys in and get the girls out of the situation and sometimes very forcefully. And it's basically really and truly saving somebody's life. And so we just did a fundraiser for that. And you meet some of those girls that were dragged out of that and saved. Oh my gosh, you know, that's. There's no ticking a box on that. Your heart's changed forever, you know, and so on every. You can mention that with a whole bunch of different charities or ministries that are out there. So you got, you probably want some different kinds of buckets, some spontaneous kind of keep your generosity pumpkin moving and

[George Kamel Ramsey]

get some ones you can get involved in. The closer you get to it, the more intentional it's going to. To feel.

[Dave Ramsey]

Yeah, exactly.

[George Kamel Ramsey]

See if you can serve them. We have ministry time here. We actually can go do that for a week.

[Dave Ramsey]

We're least likely to give to some big invisible thing where we have no connectivity to them at all. I mean, we do give to some large ministries, but we end up with some connectivity in there. Somehow. I want to, I want our family somehow to get the psychological income from the generosity. If you're planning a summer trip, you're probably spending a lot of time getting everything ready because responsible people prepare for things that matter and travel as a way of reminding us life can change fast. That's why I recommend Mama Bear legal forms. See, a lot of people put off getting a will because they think it's complicated, expensive, or they'll have to sit in a lawyer's office for hours. But without a will, your family is left trying to figure out who gets what and who takes care of your children. Instead of grieving, Mama Bear helps you solve that problem. They make completing your will easy, affordable, and specific to your state. The whole thing is designed to help you quickly get a will done without hiring a lawyer. In fact, you can finish your will in less time than it takes to pack your carry on bag. So before you load up the car or get on a plane this summer, go to mamabearlegalforms.com and make your will use the promo code Ramsey and save 20%. That's mama bearlegalforms.com promo code Ramsey. Speaking of fun things. And she was a fun caller for sure. Love that. Dave, I want to take a moment. Thank you and the team for the work you do. I'm a hospice chaplain.

[Caller]

Wow.

[Dave Ramsey]

I spend my Days walking with people through some of the most vulnerable moments of their lives. Your teaching has shaped not only my own financial journey, but I'm working my way through baby step two. And it's also given me tools I've been able to share with the people I care for at end of life. One of my patients wanted financial freedom more than anything. She told me her goal was to die without owing anyone money. Together, we worked through the baby steps slowly and faithfully, and she made it all the way to baby step four before she passed. Because of her hard work, her kids will be able to sell her house and have a little something left over. The peace she felt knowing she was not leaving debt behind was profound. It was one of the most meaningful, meaningful parts of her final months. She loved the EveryDollar app, by the way. It gave her a sense of control and dignity at a time when everything else was slipping away. Thank you for giving me the tools to be successful in my own life and for equipping me to help others find hope and freedom as well. Her story reminds me that it is possible and that the work that you guys do reaches further than you will ever see. Wow. That is not one I've run into.

[George Kamel Ramsey]

That's special.

[Dave Ramsey]

That's wild.

[George Kamel Ramsey]

That's an angel walking among us right there. For sure. That's the Lord's work. And what a cool story to have to have her go. This is the goal I want. This is the legacy I want to leave for my family, is that of freedom, man.

[Dave Ramsey]

And she did it pretty amazing. Taylor is in Orlando, Florida. Hi, Taylor. How are you?

[Caller]

Hey. Doing great, guys. Thanks for taking the call. Yeah. So first of all, listening to all these other stories, of all the stuff you guys are doing, it's super impactful. So it's really cool to just not know that it's not just me out here having all these questions, but really cool stuff. Seriously.

[Dave Ramsey]

Thank you.

[Caller]

But my question is whether or not saving 20% for the down payment on the house is actually like, mission critical or if that's something that's. I'll kind of give you the background of. We recently discovered the baby steps. We had enough cash to just pay off all the debts right away. Decided to go get debt free.

[Dave Ramsey]

Good for you. That was hard.

[Caller]

And. Yeah, well, it was. It. It was a lot. But we've been blessed and we both have good jobs. My wife, or I guess fiance technically, but soon to be wife, is about to start a new job and start making about 60 grand more than we had previously.

[Dave Ramsey]

Wow.

[Caller]

So we have a lot of income that is coming in. We just now, having recently paid off the debts, don't have as much cash saved up as we used to. And we are debating whether or not it makes sense. We've never owned a home so whether to do an FHA loan because we have enough cash to cover the payments. I know you guys teach like a 15 year, but if we're going to do stuff like that to afford it, we need to spend a lot more time saving up. I just trying to weigh, oh no,

[Dave Ramsey]

you could purchase less house. Fair, that would work too.

[Caller]

That's a good point.

[Dave Ramsey]

But anyway, way to go. Congratulations.

[Caller]

Thank you.

[Dave Ramsey]

The thing on the 20% down, we don't slap our fist on the table on that. We just remind people that if you put 20% down on a conventional loan, you avoid PMI private mortgage insurance, which is about $75 per month per hundred thousand dollars borrowed. So it's a lot.

[Caller]

Yeah.

[Dave Ramsey]

And it's basically foreclosure insurance, meaning that you're buying insurance, private mortgage insurance. PMI is you're buying insurance for the mortgage company that pays them in the event they have to foreclose on you and lose money on the house because you don't have a big down payment. They're worried that they're going to be upside down on the house at a foreclosure and that's where that comes from. But no, we don't do that. We just say it's going to be more expensive if you don't. Most first time home buyers on the Ramsey plan don't put down 20%.

[Caller]

Okay.

[Dave Ramsey]

Most of them put down 5% or 10% or something like that. And they do do a conventional loan on a 15 year fixed where the payment is no more than a fourth of their take home. Pay the FHA loan, you can get in for a little less out of pocket. That's the biggest difference in it. But it is more expensive. The closing costs are higher, the gotcha fees at closing are higher and the interest rates are a tick higher. Just a little bit.

[Caller]

Gotcha.

[Dave Ramsey]

So it's not a horrible deal, but it basically was designed for people to buy their first home or to buy a home if they don't have much money and you pay a premium to get into that to save a little bit on the down payment stroke. But if you'll be patient and now that you don't have any debt payments build up a good strong down payment. Not 20% but you know, 5 or so and get you a good fixed rate, 15 year conventional. That's going to be what we'll recommend because that's the best deal for you guys.

[Caller]

Right?

[Dave Ramsey]

And the 15 year, by the way, is cheaper. The interest rate's always lower on it than it is on the 30, and

[George Kamel Ramsey]

you'll save way more on interest over a 30.

[Caller]

Yeah, that was kind of the. Because I know you guys talk about the 15 and I've been following the math as I do research here. I was wondering if having the 15, but having the more expensive monthly or if you set up like additional payments beyond this, you know, if the 30 year has payment once a month. If you pay a little bit more than that.

[Dave Ramsey]

Yeah. But as of this moment, payment lower. As we're sitting here talking, the 30 year is three quarters of a percent more than the 15. It's sitting at about four and a half, I'm sorry, about six and a half. And the other's at about five and three quarter. A 15 year is. Okay, so it's considerably cheaper. It's almost 1%. I mean, so if you borrow like $300,000, that's $3,000 a year, year more. You're paying so that you can wiggle around in your plan you just laid out, right? And that's all you're doing. You're just trying to wiggle your way into it. Just be calm, be a little bit more precise. Slow down and build the cash up. Build the cash up and then it's your first house. You're not going to buy the freaking Taj Mahal. You don't need a McMansion. Just get the other thing. Move out of the city and out to the country, you know, get something that needs a little bit of work and get something that not everybody's like thrilled that you bought it. If some of your friends make fun of you, you probably bought the right house for your first one. But you know what? The stupid thing around Orlando, Florida will go up in value. I mean, just put Mickey ears in the front yard, it'll go up in value. You know, I mean, it's going to go up and you're going to make good money on it in a few years and your guys are going to be making more money and you'll be able to move up. You know, it's your first house. And Taylor, do not buy this house until you are married.

[George Kamel Ramsey]

Yeah.

[Dave Ramsey]

Period. No exceptions. Do not buy a house with someone you're not married to. I don't care if we call him a fiance or not. You're not married the law doesn't go, oh, wait, they're a fiance. The law says you're not married, it's your roommate. And that's a general partnership that has a different set of laws on it. Do not buy a house. People with someone you're not married to,

[George Kamel Ramsey]

if you listen to the show long enough, you'll hear that call and they're in a nightmare situation and they thought, well, I thought I'd be okay. And life didn't work out as they planned. And now you don't have the protections that you would have if you were married.

[Dave Ramsey]

So here's what's interesting. Also, Taylor, there's a difference in a 15 and a 30. I guess I've been doing this, it's coming up on 40 years now and I've had the question from day one. Because if you add up the total 30 payments on a 30 year and 15, I mean 360 payments on a 15 year and 180 payments on a 15, 15, 180 payments on a 15 year for your 15 year mortgage and you add up, including interest and principal, and you add up 360 payments for the 30 of the 30 year mortgage and you look at them, it's hundreds of thousands of dollars more you pay for the same house. Hundreds of thousands. In every case especially I've been using that example to go, never do a 30. My whole. For 40 years I've been talking about this and people go, well, I'm going to take out a 30 and promise to pay it like a 15. Here's an interesting stat for you. I'm promising to do stuff that you're not going to do. The FDIC has studied that and they say that 97.3%, that's all of them, of the loans, the 30 year loans are not systematically prepaid. They're often prepaid, but they're not systematically prepaid. Meaning I'm going to add the difference every month. And I'm going to be very precise and very disciplined because I'm the one human on the planet. No, you're not. That's just absolute bullcrap. You're not. I'm very disciplined in my life. There's a lot of things I'm very precise on, I don't miss on. And I'm not going to set myself up and make that promise to myself. And I teach this crap for a living. Instead, trick yourself into doing something smart. Things like signing up for a 15 instead of a 30.

[Jade Warshaw]

Hey, what's up guys? It's Jade Warshaw. Now I know a little something about saving money. While my husband and I were paying off over 460,000 doll in debt, we went over every expense in our budget to find ways to cut back. Nothing got a free pass including our phones. And you need to be doing the same thing. And now with Boost Mobile, one of the easiest places for you to save money is your phone bill. Their unlimited plan is just $25 a month. Forever. With a price that nice, why would you ever go back to your old carrier? And with Boost Mobile, there's no contracts, no hidden fees and no surprises, which makes this a no brainer when it comes to saving money. The best part, you can keep your phone and your when you switch. So it's not like you're making some huge lifestyle change. Listen, you need a phone, but you don't need to be overpaying every month. So whether you're paying off debt or building wealth or you just want to keep more of your money in your pocket, this is a win. Go to boostmobile.com Ramsey and make the switch today.

[George Kamel Ramsey]

That's boostmobile.com Ramsey $25 forever requires customers to remain active on Boost Mobile unlimited plan.

[Dave Ramsey]

Welcome back to the Ramsey show in the Fairwinds Credit Union Studio. George Camel, Ramsey personality, is my co host today. Maria is in Los Angeles. Hi Maria, how are you?

[Caller]

Hi. Hi Dave. Hi everyone. Thank you for taking my call.

[Dave Ramsey]

Sure. How can we help?

[Caller]

Yeah, so I have a. My husband and I are in baby step number five and we have 529s for our daughters. The youngest is 10, the oldest is 20. And the new Trump accounts just came out. So we were debating whether to get an ESA or do the Trump accounts not the $1,000 but the regular investing. And I wanted to know your thoughts on which one.

[Dave Ramsey]

You said you already have 529.

[Caller]

Yes, yes. And we learned about the ESAs doing the baby steps. But I'm just wondering, I would just

[Dave Ramsey]

keep using your529 much smarter for college

[George Kamel Ramsey]

than the Trump account accounts because the Trump accounts are going to be taxable income. The 529 if used for college is completely tax free and it stays in your control.

[Caller]

Huh.

[George Kamel Ramsey]

Okay, so as far as the financial benefits, the 529 wins every time. Well, how much is in the 529

[Caller]

so far for each one? About 1500. Okay, just started doing this.

[Dave Ramsey]

Oh good, you got it going. You got it started. Good for you.

[Caller]

You.

[Dave Ramsey]

That's more than most people. Most people just talk about it. You actually did it Good for you.

[Caller]

Thank you. Thank you.

[George Kamel Ramsey]

The other great thing is the 529, way higher contribution limits. There's really no practical limit compared to a Trump account. $5,000 a year.

[Dave Ramsey]

Yeah.

[George Kamel Ramsey]

And the ESA is $2,000 a year, so you're good. The 529 plans have come a long way.

[Dave Ramsey]

You always pick a 529 plan that has the, the, you have the right to pick the mutual funds and move the mutual funds that are inside of it. So if I don't like one of them three years from now, I can get out of it and move it. Some of the 529s are fixed, you're locked in and you don't want to do those. But the Mutual, the Proper 529, the ones we like and recommend, will allow you to select the mutual fund to put in the 529. And if it's underperforming, you could deselect it and select a different one. And just like you could do with a Roth IRA or something like that. Same exact process. And that's going to give you the best rates of return and give you the best tax benefits and the most flexibility over the ESA and over the Trump accounts. For sure. The Trump accounts are all right, but largely it's a Trump thump my chest thing. It's a thing. Trump's going, look how great I am. You already could do most of the stuff that the Trump accounts do do. It's not like it's something really substantially earth shatteringly new, other than it's got a big T on it for him.

[George Kamel Ramsey]

I did get my free thousand bucks, Dave, for my little guy.

[Dave Ramsey]

That's true. You are getting free money from the

[George Kamel Ramsey]

government if you have a child.

[Dave Ramsey]

George is on welfare now, apparently.

[George Kamel Ramsey]

I, you know what I thought, I thought I've given so much money to the government this year, I'd like a little bit back. So thank you for that.

[Dave Ramsey]

Oh, that's it. It's not actually government money, it's actually some of my money coming back to me, me. Because I've already given you more than welfare.

[George Kamel Ramsey]

I see it as a tax reform.

[Dave Ramsey]

That's better than welfare.

[George Kamel Ramsey]

It's a thank you from the government. But if you've had a child born in 20, 24, 5, 6, 7, then you can get that free thousand bucks.

[Dave Ramsey]

You got two of them?

[George Kamel Ramsey]

I got two. One was born in 25 and one was born in 23, so she missed the boat on that one. But we shall see. It is cool as a retirement vehicle for your kids. Because what you can do is once it becomes a traditional IR8 18, you can do conversions to Roth and let that grow tax free for the rest of their life.

[Dave Ramsey]

Now, which is an interesting math riddle to run out. But again, the practicality of you actually doing all of that all the way through is almost zero.

[George Kamel Ramsey]

Well, and it's a good reminder, parents need to be investing 15% into their own retirements first.

[Dave Ramsey]

Yes.

[George Kamel Ramsey]

Then save for college next. Because that's coming up a whole lot sooner than your kids retirement. So this is a nice to have.

[Dave Ramsey]

This is like after you become really wealthy and you get bored and you're trying to come up with something else to do with money.

[George Kamel Ramsey]

It's like a baby step 7 item for most people.

[Dave Ramsey]

Yeah. And beyond. Yeah. It's like trying to figure it out. It's kind of like, you know, I did. I'll tell you what I did do that was in that category. So the kids were teenagers and they were working some here at Ramsey and some at the mall and some babysitting and dog walking or whatever. So I filed a tax return like on Rachel Cruz Ramsey at the time when she was 13. And for some reason I remember it, it was $1,233. I don't know why I remember that.

[George Kamel Ramsey]

Let's go, Rachel. All right.

[Dave Ramsey]

I remember numbers is what I do. And so it's 1233 bucks. I filed a tax return and the taxes on it were like, because she's. She could not take a standard deduction because I'm using her as a dependent. So. So I had to pay taxes on the 1233 because I filed that extra turn for her on that. But that enabled me. Then you can put up to your earned income into a Roth IRA. So she's 12 years old. I opened a Roth IRA and put 1233 bucks in it. And I paid a little bit of taxes. Those were extra dollars coming out of my pocket. Didn't cost the kid a thing. The kid made $1,233. Put it in her I wanna buy a car account. That's what she did with it. But I actually filed a tax return on it, paid a little bit of taxes, and then put the 1233 out of my pocket and put it in there. And then I ended up doing that subsequent years on all three of them

[George Kamel Ramsey]

compounded for the next three years.

[Dave Ramsey]

So by the time they get out of college, all of their earned income had been put into by me as extra. But that's beyond the baby steps. That's way past. You're out of debt, your house is paid off, you're doing everything you want to do with generosity. And I'm just going, what's a math fun thing? But I mean, you take that for a 12 year old, what's 1233 become by the time they're 76? A lot. Hundreds of thousands of dollars tax free.

[George Kamel Ramsey]

Pretty cool.

[Dave Ramsey]

And so in addition to the other things so you can do some stuff like that. I would do that kind of thing before I'd screw with the Drum account.

[George Kamel Ramsey]

Yeah, I just don't want someone calling in going, hey, my kid had to go in a bunch of student loan debt. But hey, they've got a thousand bucks in a retirement account. That's not what you want.

[Dave Ramsey]

Don't do it in that order. You're exactly right. Stick with the baby, time and place for it. Good point, good point. I just shocked to hear your own welfare, that's a new thing. Jonathan's in Jackson, Mississippi. Hey, Jonathan, how can we help?

[Caller]

Hey, Dave.

Hey, how y' all doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Well, I got good news and I guess you could say good news too. Just wrote the last check yesterday to pay off all our debt. About $62,000 total house and everything. Well, the house was already paid for. Way to go.

[Dave Ramsey]

Jonathan. How does it feel to not have a debt in the world, dude? Different, Unusual, Surreal. Yeah, for real. Good for you, man.

[Caller]

Well, thank you. I appreciate that. It was, it was a lot of hard work. My wife and I both worked part time jobs to get it done and she worked actually part time, full time and part time while pregnant. And we had our first child in January and then we had to quit our part time jobs, but we still didn't quit paying down on it.

[Dave Ramsey]

Good for you. That's good for you.

[George Kamel Ramsey]

What's your question?

[Caller]

So my question is where I haven't really, I've been so focused on that I haven't really looked at our retirement accounts. So my question is, I have an old IRA God, from years ago and it's got a grand sum of 2 cents in it. And my question is, should I keep start recontributing to that? Have my wife open up her own or should we be like a joint retirement?

[Dave Ramsey]

There's no joint retirement. There's no joint.

[George Kamel Ramsey]

There's no joint tied to one person.

[Dave Ramsey]

They always have one name on them. You can name her as a beneficiary, she can name you as a beneficiary in the event of death. And if you get divorced, the judge will make you split it up anyway. But it's in your name and or her name. So you're just, she can have an ira. You can have an ira, and you can have that. Take that old IRA and start it. And so sit down with a smartvestor pro and start planning out your newfound ability to save and invest. Just jump [e-mail] that'll help you pick out one with the heart of a teacher. And you guys sit down and figure out whether you would need to roll that old IRA into some good mutual funds and all the stuff you're going to want to do now that you don't have any payments. So proud of you. If you run a business, you already know this. Bad information leads to bad decisions. And right now, AI is everywhere. But AI is only as good as the data behind it. The best AI is built on the best data. That's why I recommend NetSuite. NetSuite is the number one AI cloud ERP and more than 43,000 businesses run on it, including us here at Ramsey Solutions. Their AI isn't bolted on, it's built in. And it connects everything that runs your business, accounting, inventory, customer data, all in one place. Because when your numbers are connected, AI actually works like it's supposed to. NetSuite's AI helps flag cash flow problems, spot inventory issues, close your books faster, and cut down on manual reporting. If your revenue is at least seven figures, go to netsuite.com Ramsey for a free product tour. That's netsuite.com Ramsey. Trudy is in Los Angeles. Hi, Trudy, how are you?

[Caller]

I'm good, thank you, Dave, how can we help? Okay, my question is, I just got married about five months ago. My husband is retired. He has like 10 properties, and his retirement income is from renting those properties. When we got married, he says, you know, I came in with debt. I have about $48,000 worth of deb debt. And so he says, you just pay your bills, use your money. Because I receive a pension, he said, use your money to pay your bills. You know, don't worry about any of the expenses. So, you know, he buys all the food, he puts gas in the cars, he takes care of everything. He's just kind of absorbed me into his home. So I'm just wondering, is it okay to stay separate in our accounts while I get out of debt? And then should I talk about moving into one account? Or is it because he's so well established and maybe he, he should stay separate to protect his, his, his income.

[Dave Ramsey]

Because he, if he has to be protected from you, he shouldn't have married you.

[Caller]

Oh, well, maybe that's the wrong choice of words, but I don't know, I just wonder if you guys want, if

[Dave Ramsey]

you guys want to do this, you do whatever you want to do. I wouldn't recommend all the years of doing what we do. We see the couples that have the best marriages and the best wealth building probabilities are the ones that work together and combine and make combined decisions. And so we don't have one playing daddy and one playing little girl. It's okay, little girl. I'll just take care of you or mommy. Mommy's gonna put me on an allowance. I work hard and I give mom the check and then she tells me what I can do. And he's 60 years old or 40 years old. Mommy's telling him what to do in the form of his wife. No, that's not the healthiest form of relationships that we see. It sounds like you guys are both okay with it. If you want to do it, you're free and it's America and you can do what you want to do. But you're called here asking if you should do it. No, I don't think you should. I think he should write a check today and pay off the debt that you have. And your pension ought to go into the same account that his income goes into. And we sit down and decide what we are going to do with our money because we are now married, the preacher said, and now you are one.

[George Kamel Ramsey]

Okay, if you listen back to what you said, you basically said, I'm going to be punished until I pay off my debt and then maybe he'll let me into his financial world.

[Caller]

Right.

[Dave Ramsey]

Well, or he's just being real sweet and saying, I'm going to take care of you, little girl, while you go clean up your mess. This. Yeah, that's, that's just not a cool, I don't like that vibe.

[Caller]

Yeah.

[George Kamel Ramsey]

What is your income compared to his?

[Caller]

He's, I'm, I'm not sure how much comes in from the, the rentals.

It's.

He's got 10 properties, but he's very, he lives very humbly. I mean, he doesn't even tell anybody that he has these properties. Only me and his son knows that he does.

[Dave Ramsey]

That's fine.

[Caller]

So he's not asking to put it

[Dave Ramsey]

on a billboard, but he should tell his wife.

[George Kamel Ramsey]

Yeah, but if you make 2,000, he makes 10. It's going to take you a decade to pay off your student loans if you're lucky. So that's where I'm going. If you combine this, it's done so much faster. He probably has the money sitting around to just knock it out.

[Dave Ramsey]

And oftentimes, Trudy, again, if you guys want to do this, it's whatever you want to do, you can do. But you asked us, and so we're obligated to tell you what we think. We love you and what we think is going to be best for the two of you. This comes up, up most often in second marriages that are later in life. We don't have two broke 22 year olds asking this question, hey, they don't have 10 properties, right. But there's this weird thing that happens that you feel like you're bringing the new family, the new marriage down and he feels like he brought more to the table. And that's just not how it works. It's a combining of our lives for unity. And so you've got to work through the emotions of that, both of you. And he's humble. He doesn't tell anybody. Well, he ought to tell his wife. Hello, I'm pretty humble about some things and I ought to tell my wife, honey, this is what we made this year. This is what our tax return says. This is what we just close that. We just got that thing signed and here's what we made on that. And she has very little inner working knowledge of a lot of that, but she ought to know what's going. Sharon wants to know. She needs to know. I get hit by the proverbial milk truck. She's going to need to know how this is going to work out and how she can function without me paying all the bills and so forth. And so these are two standalone adults, not what we would call a kept woman. And so that's what we would want for you guys. We would want some more of that. And guys, it's interesting, I didn't even know this. I found it out later as we've been talking about this and teaching it for all these years, the old marriage vows. I mean, most people heard the standard marriage vows. In sickness and in health, for richer, for poor, unto thee and so on, Right? But there's an actual set of marriage vows in the ancient book of common prayer. Like if you're orthodox or something, you would find a it there. And it says, in sickness and in health unto thee, all my worldly goods I pledge at the altar in front of the preacher.

[George Kamel Ramsey]

All of my wealth, income, toys.

[Dave Ramsey]

It just became ours. It's now a we, it's not a mine. And it's not like I'm going to pat you on the head and take care of you because you're somehow deficit and I'm superior. And he's not that guy. This guy here, he's not. Trudy's husband's a nice guy. Yeah. He's a sweet person. And he's not being that condescending.

[George Kamel Ramsey]

He just lives so long in his own world. He's going, hey, let me just cover the bills.

[Dave Ramsey]

You do the job, I'm taking care of it. I got you covered, kid. I got enough money, I'll take care of you. I love you. And that's all he's saying. But the downside of that is then that Trudy doesn't. She doesn't have insight into how the whole thing's operating. Operating. And she should, as his wife. I think, well.

[George Kamel Ramsey]

And there's a lot of unity and excitement of just going, we're going to build wealth together versus hey, let me handle it. You do your little thing over here. I got this. I'll cover the bills.

[Dave Ramsey]

And I run into it. Truthfully, it's a blue collar thing. More the neighborhood I grew up in. It's like the mom takes care of the money and dad just works shift work and comes home, brings the check on Friday and plops it down. And they always call the wife mom. I call my wife mom. I call Sharon mom or Mimi. That's what I call her. We're on the golf course and I'm like, good hit mom. You know, and they're like, that's your mom. No, it's not. It's not my goober. It's the mother of my children. But the so, but that's, you know, and so that's the neighbor. That's the vernacular I grew up with kind of thing. But it's like, you know, mom only gives me so much allowance and I can't do so much. Says a 45 year old guy working 60 hour work weeks and it's like his wife is his mother.

[George Kamel Ramsey]

The old ball and chain.

[Dave Ramsey]

The old ball and chain. That's exactly. Yeah. And because she's assumed headship in the household and he just defers to her. Then I'm on an allowance and I can't stop buying. I can't do, you know, I can't do that. We can't go fishing Saturday. I don't have the license. You know, all this stuff, it's the stuff I heard my whole life. It's like. Well, you know, it's like, are you a child or are you, like, a man?

[George Kamel Ramsey]

That can't be a quality fun marriage. It's just very transactional almost.

[Dave Ramsey]

It's almost a cop out. Like, I don't want to be responsible, so I'm gonna let her or him be that. And Trudy's not any of that. No, but this. Just. This whole discussion, though, goes in the same bucket. But Trudy's is much, honestly, much more functional than a lot of the things we hear.

[George Kamel Ramsey]

And they'll be.

[Dave Ramsey]

There was a kindness coming from her husband. I heard. Yeah, she received it as kindness.

[George Kamel Ramsey]

You said, hey, you'll be fine doing it this way. But it could be so much better.

[Dave Ramsey]

Yeah, I think it'd be better if the two of you both stood up like two adults. And we. I, you know, I brought you. You know, this is. You're my wife, and we're gonna write a check today and pay off this debt. He's got that guy has the money in his account right now to pay off that debt, and then it's just uncomplicated everything. And you didn't marry him for that, or you wouldn't have gotten married. He wouldn't have. He wouldn't have gone.

[George Kamel Ramsey]

He would have smelled it a mile away.

[Dave Ramsey]

Exactly.

[George Kamel Ramsey]

Hey, George Camel here. A few years ago, someone stole my identity. And let me tell you, that is not a quick video fix. It takes hours on the phone, piles of paperwork, and a whole lot of stress trying to untangle the mess. And even after that, there's this nagging paranoia because your information is already out there. And the truth is, you can do all the right things and still become a victim. That's how common identity theft is. And that's why I'm glad I had Zander's identity theft protection. When my identity was stolen, their team stepped in right away. They were monitoring my information and caught the issue. And their US Based recovery special help handle the calls, the paperwork, the cleanup, so I didn't have to do it all on my own. Zander also includes up to $2 million in stolen funds and expense reimbursement. And with the family plan, your kids are covered for free. You work too hard to let identity theft steal your time, your money, and your peace of mind. So go to Zander.com to enroll today or call 800-35-6428.

[Dave Ramsey]

Buying or selling a home is a really big deal. You don't want to overpay for a house. You don't want to sell Your house too cheap. You know we had a caller the other day, George, that had listed their, their. His mother in law listed the house. Oh boy. For 335,000. It's sold in two days. The appraisal came back at 375,000 and he was wanting to know how to get his mother in law out of the contract because she had sold her house too cheap.

[George Kamel Ramsey]

They left a lot of money on the table.

[Dave Ramsey]

30, 40,000 bucks. You know who I blame? Real estate agent. Oh, who put this house on the market? $40,000. 15% under what it should have been priced at.

[George Kamel Ramsey]

She didn't do her research, didn't run the comps, she didn't price it.

[Dave Ramsey]

He or she, the agent said sucked. So you need to get a real estate agent. You make a real estate mistake. It's not a, they don't, you don't make hundred dollar mistakes on real estate. You make $10,000 mistakes at least on real estate. So you need to get a high octane, high protein professional real estate agent. We vet the agents that we put on our website to recommend to you. They're called Ramsey Trusted. They do, you know, 50 to 300 transactions a year. They don't do two transactions. And they actually know how to do, do a comparative market analysis and appraisal to get your house on the market for the right price. So you don't call me up and say my mother in law just sold her house for $40,000 too cheap. Ouch. Ramsey solutions.com agent. And you can find a Ramsey trusted agent for free or click the link in the description if you're on YouTube or podcast. Andrew is in Cincinnati. Hi Andrew, how are you doing?

[Caller]

Pretty good. Thank you Dave and George for taking my call.

Sure.

[Dave Ramsey]

How can we help?

[Caller]

So my question is. Well first I want to start off by giving the context. I recently just gave my life over to Jesus Christ and I'm taking the Bible seriously with my life. And I've discovered, I've discovered that I have a PhD in BUMB, just like you would say. And I'm new to the Ramsey baby steps. I have $41,000 in debt, $25,000 a part of that total combined debt of an auto loan. $9,000 in one credit card to about 1300 and another credit card and a $5,000 debt that I owe my parents. My girlfriend, I'm 32 years old.

[Dave Ramsey]

Okay, what about your girlfriend? Say that again.

[Caller]

So I just broke up with my girlfriend. She didn't want to go to church, didn't believe in God. So I want to do a 180 with my life life. And be a good steward and a leader to myself and my community in my future family. Wow,

[Dave Ramsey]

man, you have been through it. Look at you. You're on. You are on fire. Good for you. Okay, and what do you make a year?

[Caller]

Sir, I make 52,000. Have my primary job. My secondary job as a real estate agent. I've made about 25,000.

[Dave Ramsey]

Okay, so 75. Very cool. Yes, sir, Very cool. Well, as you've already figured out by poking around the Ramsey stuff, we are also Jesus people. And we build the systems that we use based on biblical principles. Now, not everything we teach is from the Bible. Some of it is. The implications are from the Bible. But like the Bible says, the borrower is slave to the lender. So we take from that. I don't want to be in debt, which is why you called. So that kind of is the way we now. How do we. How do we get out of the debt? Well, that's not necessarily a biblical thing, but it is a cool thing. Cause here's part of your young faith experience. As you're brand new in all of this, what you're gonna discover is that God is gonna use this money subject to help you with the transformation you're going through in all parts of your life. Because you're gonna become a different person as you go along the process of getting out of debt and as you go along the process of handling money properly. And becoming the different person is actually the goal. The money stuff is a side goal. Does that make sense?

[Caller]

Yes, sir. Yes, sir.

[Dave Ramsey]

And so I'm real proud of you. Thank you for giving us all that context. And I'm proud of where you are at this moment. Okay, so $75,000 a year. And you probably heard about the baby steps. They're not in the Bible. We made those up, but they work.

[George Kamel Ramsey]

It's in second opinions.

[Dave Ramsey]

It's in second opinions, second hesitations. Yeah. And so, yeah, you're going to first save up $1,000 after being on a budget. Now, being on a budget is a biblical thing. God talks about planning all through scripture. Jesus said, don't build a tower without first counting the cost, lest you get halfway up and you're unable to finish. And all who see you begin to mock you and say, this man began to build and was unable to finish. So you don't build a house without a blueprint, and you don't build a life without a budget. So you're going to do a budget on every dollar. We're going to hook you up with that and pay for it. The upgraded premium version will give you a year's worth of it when we get off the line here. So you're going to do your budget. And in your budget, first thing you do is you find $1,000 and set it aside as your starter emergency fund. And then we're going to list these debts, smallest to largest. $1300 worth of credit cards will be your small one. And we're going to pay minimum payments on everything but the little one and attack the little one with a vengeance. Now, are you paying your parents payments on the 5,000?

[Caller]

Yes, sir, I am.

[Dave Ramsey]

Okay, good. Okay, so keep paying that minimum payment, keep paying your car payment, and keep paying the $9,000 payment and then all other money we squeeze out of the budget after we've got our baby step one, $1,000, we're going to throw at that $1,300 credit card and cut up all the credit cards when you get off the phone, okay?

[Caller]

Yes, sir.

[Dave Ramsey]

Get a debit card. It'll do everything your credit card will do except go in debt.

[Caller]

And where I broke up with my girlfriend, she had her house on land contract and I helped her pay all of that. And so of course I wasn't able to pay down a lot of my debt. So I think my next question is, I literally moved in with my parents. Should I seek independence and just go rent while I'm doing this? Should I live with them? Should I save up for a home? How exactly should I go about.

[Dave Ramsey]

So you've been there for two weeks?

[Caller]

Yes, sir.

[Dave Ramsey]

Yeah. Well, you don't want to stay there indefinitely, but you're in the middle of a chaotic, transformative period of your life. Okay. You have a breakup, a move, a reset. Spiritually, you are adjusting the other parts of your life to align with the spiritual connection with your newfound faith. And so all of those things are good. I'm okay with you using your parents as a safety net, but not as a hammock.

[Caller]

Yes, sir.

[Dave Ramsey]

So I would establish a period of time I'm going to stay here. Assuming that it's not a toxic environment, assuming it's a good environment, a period of time I'm going to stay here and after that I'm going to be out. And so, you know, maybe you sit there six months and you use that six months rent free to. To really knock out a few of these small debts and get some wiggle room in your budget. I don't think a 32 year old is going to want to stay there for three years unless you're weird. Does that make sense? So, I mean, so let's just kind of find that balance. Maybe, maybe six months is the number. Maybe three months is the number. I don't know. You look at and you figure it out. But yeah, start, you know, let's get our feet under us and get, you know, touch ground here and then say, okay, based on that wisdom and what my budget's telling me, I'm gonna make a much better and much more informed rental decision. I mean, I'm gonna rent the cheapest thing I can possibly rent, but be out on my own and have my adult dignity back, so to speak. Speak. But using them as a safety net is fine. And so people often, I always tell, we're always hard on parents, have their kids in their basement and all that kind of thing. But people always say, Ramsey says, never do that. No, we actually do think there's a moment in time that for a short period of time, that mom and dad can be a great safety net for adult children. You just don't want to be a

[George Kamel Ramsey]

hammock transition, all of that.

[Dave Ramsey]

Yeah, we don't want to be a hammock. And not for Andrew, because he's not in this situation.

[Caller]

But.

[Dave Ramsey]

But for, you know, everybody else. I mean, that. That's the thing. I. For everybody else, you know, the. An eagle that doesn't leave the nest is a turkey. So you just can't. That's a problem. So we've got to work that out. But, you know, can you come home and heal if the eagle got, you know, got damaged? Yeah, you can. And he's in a healing period, a changing, a metamorphosis period right now. And so good for you and good for your parents that that's available to them. Available to you that you got a good relationship with them. So, yeah, let's do a little bit of that. And then you go. But go ahead and figure out how long that is. Is it three months? Six months? Nine months? What is it?

[George Kamel Ramsey]

Here's what nobody warns you about. You're behind on payments. You signed up with some debt settlement company. You're making your monthly payments to them. And then one morning, a process server knocks on your door. Surprise. You just got sued by a creditor. And that company you tried trusted. Not a law firm. They're not built to represent you if things escalate. And now you're scrambling to figure out what to do next. And that's why I tell people about Guardian litigation group Guardian Litigation is not a call center. They're actual attorneys at a law firm. And from day one you're assigned a real attorney who can represent you if a creditor takes you to court. No scrambling when things go sideways, just real legal protection built in from the start. And look, the best way out of debt is still the budget, the plan, the baby step steps. But if you're already in default and legal threats are coming your way, Guardian has your back. Their attorneys have helped over 55,000 people settle more than $600 million in debt. So get real legal [e-mail] Ramsey that's guardianlit.com Ramsey Attorney advertising results may vary and no specific outcome is guarantee.

[Dave Ramsey]

The Ramsey Show Question of the day is brought to you by why refi missed private student loan payments putting you in default can keep your budget stuck? Why refi helps borrowers Explore how fixed rate financing with low low payments based on what you can afford get you moving again. Visit yrefi.com Ramsey that's the letter yrefy.com Ramsey might not be in all states.

[George Kamel Ramsey]

Today's question comes from Michael in Alaska. How do you protect your debit card while shopping either online or in a store? I'm worried about someone accessing my bank account funds. Simple question. I've got a lot of ideas here as well. Sort of the the mixture of my worlds of tech and and finance.

[Dave Ramsey]

Have at it.

[George Kamel Ramsey]

One of the main things and this is great with modern technology is Apple Pay. So Apple Pay blocks your actual card number at these transactions and it's a tap to pay. So your card is never actually used or exposed. So that's one way it's encrypted. Another one, and this one's actually a new Advertiser on my YouTube channel, but I've used them for years. They're called Privacy.com and they create virtual card numbers that you can lock up to merchants with spending limits, time limits, one time use. So I use those when I shop online because your actual debit card number is never exposed. It's a virtual card number that's attached to your bank account or debit card. So that's pretty cool too.

[Dave Ramsey]

Most websites, including ours and you know I've learned about this because of owning Ramsey, otherwise I probably would have never learned about it. When we accept your debit card to purchase a total money makeover book or George's book on our website, the number is not stored literally it is tokenized is what they call it in the tech world. And so it's encrypted, in other words. And so we have a token, an encrypted token on you then that when you come back, you can use the same card very easily. So like if you return to a website of any kind where you do shopping, that's what's happened. If it's a decent website, if it's sophisticated in any way, they will have tokenized it, meaning they're not in their database to be hacked. Is not your entire card number. We simply do not have your entire card number. It's gone as we wanted to. But we have access to your account through that token only. And so it keeps fraud from actually happening because we would have some liability if you got hacked through here. We don't need the PR problem of that. So if you're dealing online, you're going to run into that a lot with reasonably sophisticated sites. The second thing is that you are not liable for charges on your debit card that were fraudulently made, just like you're not on your credit card. And I've heard people incorrectly and that's a minimum ignorantly say on other financial shows. Well, you never get a debit card because credit card protects you in the event of fraud. Debit card gives you the exact same protections. Look it up on visa.com look it up.

[George Kamel Ramsey]

Zero liability policy.

[Dave Ramsey]

It says it right there. It's got a little paragraph called the zero liability policy on all Visa and MasterCard products, whether it's a Visa credit card or a Visa debit card, a MasterCard debit card or credit card. Zero liability in the event of fraud. So if someone steals your number and buys stuff and this actually happened to Sharon a week and a half ago. Oh, wow. Our bank contacted us and said, did you buy $10,000 worth of Louis Vuitton in South Carolina last week? And we're like, no, we did not. Weren't in South Carolina. And Louis Vuitton was not on the Christmas list. So didn't happen. And they're like, okay, $84,000 worth, these people, wherever they grabbed her number, wherever they scarfed her number, they hit Louis Vuitton and co coach all over America. And I don't know how they were doing it.

[Caller]

Wow.

[Dave Ramsey]

But it was hitting my wife's. It was hitting my checking account with my wife's debit card. And you know what it cost me? $0.00. $0.00. You know what it cost? Oh, Louis Vuitton. I don't know. I don't know. Did they actually let those purses and suitcases get out the door with the fraud. They might have. But when they got back and the charge was denied, maybe they recalled the order, maybe it was an online order, I don't know. But it was 80,000 bucks.

[George Kamel Ramsey]

That's wild.

[Dave Ramsey]

That was a lot. I think they knew whose card they'd gotten a hold of.

[George Kamel Ramsey]

Yeah, they went ding, ding, ding.

[Dave Ramsey]

I think we just hit the lottery. So we don't know what happened, whether it got picked up, whether somebody took a picture of it in a back room or where it happened. But that happens with credit cards. It happens with debit cards. It's identity theft. And there's fraud online and there's fraud in stores and there's atm, you know, gas pumps or have, you know, the artificial things where the crook is scanning your number and keeping your number and that kind of thing. I've heard of all of these things happening. I have never lost a dime. And I have had a debit card for as long as there have been debit cards. Probably 30 something years.

[Caller]

Wow.

[Dave Ramsey]

I've never lost a dime. Now I have had all kinds of situations where the bank sends me the email that says, is this you? Or the fraud department will call and say, is this your you? The 800 number rings on the phone. Right. But they do that with your credit card as well. They'll check a lot of times. One good notice if it breaks the algorithm. So, like if we, if we head out of the country, we just spent three weeks in Argentina. If we head out of the country, we ring, we. We email my banker, my private banker, and say, we're going to be in Argentina. That is us. Those charges are us. Look, for that, you don't need to because that'll trip the algorithm and the whole stinking thing will get shut down. I'll be down there with no money. That's not a good idea. Right. So. But I let them know. But, but the algorithms are all. They're excellent. They're getting better all the time. The identity theft protection that Zander has is there as well, but I've never had to access that for any of this. The debit card is as safe as the credit card. Period. And especially if you keep up with your stinking banking.

[George Kamel Ramsey]

Yeah, the big part is just paying attention.

[Dave Ramsey]

You never look at your checking account but once a year. Well, no wonder you got screwed because you're screwing yourself. You're doing a bad job of handling your money. You need to know what's going on with your money. So, same thing. So, you know, that's.

[George Kamel Ramsey]

I get text Every transaction that comes through goes to my phone.

[Dave Ramsey]

Really?

[George Kamel Ramsey]

Yeah.

[Dave Ramsey]

Every single transaction. That would drive me bananas.

[George Kamel Ramsey]

I guess it's probably when you're using at a point of purchase.

[Dave Ramsey]

I don't get. I don't get it at all. I don't get a single.

[George Kamel Ramsey]

You're missing out. It's a good time. It's. The only people that text me is my bank. I can't get a hold of my wife.

[Dave Ramsey]

It's a party. It's a banker party.

[George Kamel Ramsey]

It feels good to get a text.

[Dave Ramsey]

Sounds like a party party to me. That would drive me bananas. I don't need all that activity. But I do need the protection, though. I don't want, you know, some crook loading up on Louis Vuitton with Sharon's name. I don't want that happening. And then they tried. They tried, and we were happy to sign. I think they sent. Oh, they did. The bank sent over an affidavit because this was an unusually large.

[George Kamel Ramsey]

Yeah, that's like a police report level.

[Dave Ramsey]

Yeah. So we signed affidavits and everything for them to put in the file.

[George Kamel Ramsey]

Did they do a search of your house to make sure there was no Louis in there?

[Dave Ramsey]

Well, they would find Louis in there, but they would be older than last week, and. And they would have been actually paid for by us, so. Yeah. And not stolen by us, but. Yeah. Wow. Not in my closet, but in my wife's. But anyway. Yeah.

[George Kamel Ramsey]

So I covered all this, Dave, in my book, in the credit card chapter, Breaking Free From Broke, I literally have a spot about the fraud protector. That's the archetype of the credit card user who says, well, credit cards are safer. And I go through all the nitty gritty details, the Electronic Fund Transfer act And all these 17 ways you can stay protected. And it's really a nothing burger. It's more paranoia at that point and a justification to keep your credit card more than it is reality. So I want to just convict everyone out there going, well, I don't want to cut it up, because fraud could happen. There's a higher likelihood you put yourself into debt than fraud happening if you're using that credit card.

[Dave Ramsey]

Well, fraud. You really should. The only way you're going to catch it on your credit card is if you look at the stock and go, I didn't charge this. The only way you're gonna catch it on your debit card is if you keep up with your statement. And I didn't charge this. So you actually have to freaking pay attention to your life or you're gonna crash. Cause I mean there's crooks everywhere. There's more people, there's people that work harder at being crooks than they do at their job. And they're even better at it than they are at their job.

[George Kamel Ramsey]

And if you lose your debit card, you gotta lock that thing immediately. So like Fairwinds, which has been an awesome partner, I've got their debit card. If I lose the Fairwinds debit card, I go into the app and hit lock. No one can use the card.

[Dave Ramsey]

So I'm pretty sure our bank has that one too.

[George Kamel Ramsey]

Yeah, there's a lot of these protections these days that it's actually safer than it's ever been to use a debit card.

[Dave Ramsey]

Yeah. And it may actually, because it's more, the algorithms are more sensitive. It may actually be even safer than a credit card.

[George Kamel Ramsey]

I believe it.

[Dave Ramsey]

But the, they do have the same exact fraud protection. You get charged zero. That's Visa and MasterCard's guarantee on their written agreements. Welcome back to the Ramsey show in the Fair Winds Credit union studio. I'm Dave Ramsey, your host. George Castle, Ramsey, personality number one best selling author is my co host today. Mike's in San Diego. Hey Mike, what's up?

[Caller]

Great to speak with you guys today.

[Dave Ramsey]

You too.

[Caller]

I'm calling to find out if you all think we're, I, we, my wife and I are potentially contributing too much to retirement to time when maybe a little bit further down the road we'll, we won't have access to that money for a while and there's some other things we could be doing with it.

[Dave Ramsey]

Okay. Are you out of debt?

[Caller]

Yes, sir.

[Dave Ramsey]

House and everything?

[Caller]

Yes, sir.

[Dave Ramsey]

Good. Way to go. How old are you guys?

[Caller]

We are 41 and 39.

[Dave Ramsey]

Good for you.

[Caller]

Okay.

[Dave Ramsey]

And how much is in your retirement accounts now total.

[Caller]

So because we have two different jobs, we have access to a number of different accounts. So between the 401k, the 457 and the 403b, we have 600k and then in an after tax brokerage, we have 600k and then we've got 100 and change in a 529 and then 40k in an emergency.

[Dave Ramsey]

Excellent.

[Caller]

Okay.

[Dave Ramsey]

And then so if you have 600k in a brokerage account, I assume, I assume the 600k in after tax brokerage is invested in good mutual funds.

[Caller]

Yes. Well, it's between that and S and P index funds.

[Dave Ramsey]

Okay, good mutual funds.

[Caller]

Yeah.

[Dave Ramsey]

I mean you're earning market returns then on, on those investments, which means that 600 is going to double about every six years or so. Okay. So when you're 47 it'll be 1.2. And why would you need more than that before you're 59 and a half? Oh, by the way, when you're 54, 53, you'll have 2.4 if you don't add anything to the brokerage account.

[Caller]

Right. I think the key there is we have the ability to contribute in pre tax money. Right. So saving us quite a bit in our income too. Both a 401k, a 457 and a 503.

[Dave Ramsey]

But you said your question was am I currently putting too much into retirement? Wasn't that your question?

[Caller]

Correct. Yeah. So we're maxing out all of those accounts.

[Dave Ramsey]

Yeah, but it's only 600k. And then the other 600k is an after tax. Right?

[Caller]

Correct. Okay.

[Dave Ramsey]

And you said, I'm afraid I'm going to have too much of it tied up and I won't be able to get to it. But my point is your 600k is going to be 2.4 million before you get to 5,900 a half. And that's if you don't add anything to it in the brokerage account.

[Caller]

Right? That's the brokerage.

[Dave Ramsey]

But yeah, what do you, what do you. And the other account will be growing faster because you're putting more into it. That's, that's me saying if you don't put anything into the 600k. So what is it that you think you're going to need to buy? That's millions of dollars before you're 59 and a half.

[Caller]

Well, we are in San Diego, so the houses are not cheap.

[Dave Ramsey]

You not own a home yet?

[Caller]

We do. Okay.

[Dave Ramsey]

And it's paid for?

[Caller]

Yes, sir.

[Dave Ramsey]

And what does it call? What's it worth?

[Caller]

Probably 1.7.

[Dave Ramsey]

Way to go. You guys have done so good, man. Congratulations. You got a lot of money. So what's your income?

[Caller]

Acome is around, depending on the year and bonus, maybe around 300.

[Dave Ramsey]

Okay, man, you guys are just. You've done a wonderful way to go.

[George Kamel Ramsey]

So what are those future goals? You said there's other things that we want to do. What are the. Have you guys laid those out to see what they're going to cost, when they're going to hit?

[Caller]

Well, the big one for us is, is we'd love to either invest in real estate locally, which given the area we're in is a challenge because it's so expensive, or even potentially Upgrade in house. But given where we're at, right, you sneeze wrong in the wrong direction and your taxes go through the roof or whatever else with respect to, you know, homes here. But, you know, because we're contributing close to 75k to toward retirement, if we were able to reallocate some of that.

[Dave Ramsey]

Are you putting money into the 600k after tax account at all?

[Caller]

Not right now.

[Dave Ramsey]

Okay.

[Caller]

No. Okay.

[Dave Ramsey]

All right.

[George Kamel Ramsey]

If you guys make 515%, 75K. So I think you guys, you know, obviously you can invest more than that. Your house is paid for. But it doesn't sound like you're contributing so much. You're filling them out, you're maxing them out. And then once you reach the point where you don't have access to those, you can go to the brokerage, buy some real estate.

[Dave Ramsey]

The answer overall is to be investing and you're doing that. And so are you going to have enough at retirement? Yes. You're going to be in great shape. You're already in great shape and you're only, you know, you're only 41 and 39 years old. So because you've just done a wonderful job. So now it just becomes a nuance of how we want to flesh this out. If instead of maxing out all available retirement and keeping the government's hands off of it, if instead of doing that, you said, I'm going to put 15% into my Roths and my 401k Roths and so on and the rest of it I'm going to put over into this other brokerage because I want to do some other things like buy some real estate for cash and that's going to be my other investment that I want to do. Then that's a decision and you're not wasting the money. Both are going towards investments, both are going towards good quality investments. So I don't have a problem with it at all. You're going to have plenty for retirement. Now what I would challenge you to do is to monitor that as you go along. So let's say that you said, all right, we're going to put 75K into retirement. That's 15% like it was baby step four. You're not at baby step four anymore, you're at seven. But let's just, okay, we're going to put 50 and everything else we're going to put in the after tax brokerage account and when it gets big enough, we're going to buy a piece of real estate with it. That's okay. But what I would do as you're doing that then is I would monitor going along and say, you may look up someday and go, okay, now I've got enough in there, or I'm putting too much in that 600. I could be keeping the government's hands off of more of this money by maxing out a few of these other things and come back and max out out everything. In my case, what I personally did in your situation, my income was different than yours, but I maxed out everything to keep the government's hands off of it and then piled up cash for after tax investments. And I still do. I still use a simple brokerage S&P 500. I don't even have it in a brokerage account. It's just an S and P. And I just throw cash in there. I, I get a big royalty check from a publisher and I just chunk cash over there. And when that account gets big enough, I go buy a piece of real estate with it. That's my personal strategy. It's not any fancier than that. But I'm maxing out all the other stuff even at 65 years old, just because I get so pissed off about how much of the government takes from me. And I want to get it all in any kind of tax protected account I possibly can. But you could, you could limit that for a little while and get that 600 up to 2 million and then start that plan.

[Caller]

Yeah, that's really the key there, which is kind of. It's hard not to contribute to some of those accounts because of the tax benefits. But.

[Dave Ramsey]

But I also want to do these other things sooner than I'm going to be able to if it's all over in that other account. Yeah, yeah.

[George Kamel Ramsey]

So maybe you max out the ones with the best tax advantage advantages and then move to the brokerage once you get that piece of property.

[Dave Ramsey]

So if you put 75 away in your retirement, how much more could you throw at your after tax brokerage account? Beyond the 75?

[Caller]

It depends on how much we want to have fun during the month.

[Dave Ramsey]

I know, I know. How much are you thinking?

[Caller]

I think it's really five grand.

[Dave Ramsey]

How much are you thinking?

[Caller]

A couple thousand, at least.

[Dave Ramsey]

Okay. All right, then that's not a big deal. Yeah. The big thing is going to be keeping it invested well and it's going to double on your investments. But in six years, seven years. All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates, but when you have the Right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back. From the first call to close call closing day, find a Ramsey trusted agent near [e-mail] agent that's ramseysolutions.com. Thanks for joining us. U.S. america. So the network net worth calculator is happening, George?

[George Kamel Ramsey]

Oh, yeah. Coming up in a few episodes, I'm going to be walking through the latest data on net worth by age as sort of America's financial report card, if you will. And I want to know how our audience stacks up. And here's my bet. I bet you that our audience has a much higher average net worth than most of America. So here's the challenge. We're going to include a link in the show notes of this episode to our Ramsey Networks couch calculator here. Here it is. Go calculate your net worth. Let us know in the comments your age and your net worth. Whatever you're watching, we're going to compile the comments and see how our audience stacks up against the data. So head to the show notes. If you're on YouTube or podcast, take the net worth calculator and put it in the comments with your age. That'll be a fun.

[Dave Ramsey]

And it's [e-mail] right. That's how you find the calculator.

[George Kamel Ramsey]

And we'll link it directly in the show notes if you jump down there.

[Dave Ramsey]

Okay. That's the easiest way. All right. Yeah. Because it's my scientific research keeping the Internet there on the Ramsey page, there's of lots of Ramsey solutions pages. So net worth calculator is a good measure because that's, you know, what we need to teach people better to use that. We're actually working on adding a net worth calculator. Automatically does it inside your every dollar budget.

[George Kamel Ramsey]

Oh, to track that where it tracks

[Dave Ramsey]

all your stuff and then it constantly is updating. You know, like you hook it to your mutual fund accounts and you hook it to everything. It'll add up investments, real estate. You'd have to do your real estate buying. But you just open up your every dollar and you go, oh, my net worth went up. Like Warren Buffett says, stock price goes up. On Berkshire Hathaway, his net worth goes up. All he's got to do is just calculate the stock price. So same kind of thing. But the net worth is an actual Measure of your financial health as opposed to, say, the stupid butt FICO score.

[George Kamel Ramsey]

You got an 850 with negative net worth.

[Dave Ramsey]

You're not crushing it, you're crushing paying the bank too much. Yeah, and so if you said I actually have a net worth, a positive, I mean, most people have a negative net worth. By the way, you owe more than your worth.

[George Kamel Ramsey]

If you got nothing in savings and debt.

[Dave Ramsey]

I've got $100,000 in student loan debt and I live in an apartment. You have a negative net worth. Okay? So that's because your net worth is what you own minus what you owe assets, minus liabilities, which is the actual measure of financial health. If you want to set long term goals, like 50 year goals, 30 year goals, and you say, I want to be a millionaire. Well, a millionaire is a net worth goal. That's what you own minus what you owe equals a million dollars. If you owe nothing and you own a million dollars worth of stuff, you are by definition a millionaire. And people like, well, I don't. I don't make. You don't make a million. It's not how much you make how much.

[George Kamel Ramsey]

You sound like a millionaire, Dave.

[Dave Ramsey]

This is not a how much you make thing. This is a how much you keep thing. A lot of people make a million dollars and got nothing. Welcome to sports world, right? Welcome to the NFL. NFL. Okay, I got nut and honey, but I made a lot of money. Or other people didn't make nothing and they saved all of it and they got millions of dollars. So your net worth is actually not. Your income is actually your measure of financial health. It's one of the primary measures, and we've gotten away from it because the banks have taught us to get screwed by them. They've taught us thoroughly what's in your wallet. Not your card, my money. That's my answer. Samuel L. Jackson. I'll tell you what's in my wallet had got nothing to do with you. Nothing to do with you. Actual Benjamin Franklin in my wallet, looking at me, smiling. That's what's in my wallet. So, I mean, you know, but they've taught us over and over and over with these dadgums. You know, more money is spent advertising Visa, MasterCard and American Express and Discover than almost any other product in the world.

[George Kamel Ramsey]

That should tell you something.

[Dave Ramsey]

Hundreds of millions of dollars a year spent advertising, teaching you that you can't live without those goobers.

[George Kamel Ramsey]

You need the rewards. You need to up your score. You need more lines of credit. That's what's pitched.

[Dave Ramsey]

Yeah. You're walking through the airport and they're yelling from the table. You can get airline miles. Sign up here. Like a carny. It's like a carny. And it just like the Kearney. When you go over and pay your money, you don't get the stuffed rabbit because the game is rigged just like a carny, only it's Southwest Air is the carny. And they're standing in front of you while they're telling you to put your seat belt on, selling you a credit card from the aisle. And the stewardess is doing it. You don't think these people are good at what they do? They're better at what they do than you are at what you do because you bought it, people. So the banks, their job is to sell you on believing that the FICO score is a measure. Which. How do you get a FICO score? You borrow money. So that. Why? So that you can borrow money. So why? So you can borrow money. Is this a dog chasing its tail or what is a dog chasing his tail with NASCAR stickers all over it that look like banks?

[George Kamel Ramsey]

Just look.

[Dave Ramsey]

Visualize your dog. Put bank of America, fifth, third, put all the bank little stickers on your dog, and then teach your dog to chase his tail. Now you got a FICO score.

[George Kamel Ramsey]

It's a great representation.

[Dave Ramsey]

That's exactly what's going on right there. So you look like NASCAR looks stupid, so don't do this.

[George Kamel Ramsey]

I had a fun interaction on a Delta flight. The stewardess walked up and he said, close your ears. And then she did the.

[Dave Ramsey]

The picture, the credit card.

[George Kamel Ramsey]

She recognized me.

[Dave Ramsey]

And she went, I'm sorry, George. I have to do this. It's my job.

[George Kamel Ramsey]

She apologized ahead of time.

[Dave Ramsey]

I appreciate that. That's funny.

[George Kamel Ramsey]

I went, la, la, la, la, la. I can't hear you, George.

[Dave Ramsey]

Standing behind her going, no, don't do it.

[George Kamel Ramsey]

It's not worth it.

[Dave Ramsey]

Dive on the grenade, George.

[George Kamel Ramsey]

I'm not a good salesperson for your credit car.

[Dave Ramsey]

But seriously, seriously, if we did on the Ramsey show just a tiny bit as good as they do selling debt, about selling the net worth calculator, which is an actual measure of winning. Because as your debt goes down and your savings, investments, and real estate values go up, you are winning. That's the definition of net worth. If we get this net worth calculator to be the thing rather than the FICO score. Wow. The issue is we would have actually done something.

[George Kamel Ramsey]

Your net worth is intangible, whereas the debt gets you the thing you want. Right now, the net worth Takes time to build.

[Dave Ramsey]

And the net worth requires that your emotions be mature. The FICO score requires that your emotions be immature.

[George Kamel Ramsey]

They want you to be impulsive.

[Dave Ramsey]

They want you to be a child, a baby child. I want it. I want it. I deserve it because I work so hard.

[Caller]

Hard.

[George Kamel Ramsey]

And they'll tell you that in the marketing. They'll literally say, you work so hard, you deserve it. And we say, you work so hard.

[Dave Ramsey]

I was McDonald's. You deserve a break today. Right?

[George Kamel Ramsey]

Oh, that's right. Yeah, that's good marketing.

[Dave Ramsey]

You deserve a Big Mac. Is that all I deserve?

[Caller]

Wow.

[Dave Ramsey]

I'm really not doing very well. Lord, if that's all I deserve is a Big Mac, that's a dark future. I think fine dining is what I deserve.

[George Kamel Ramsey]

You deserve a steak. But settle for McMuffin.

[Dave Ramsey]

Settle for a McMuffer McMuffin. Get you a McRib. We're not sure what that rib came out of, but we're just saying it's a rib.

[George Kamel Ramsey]

Whatever it is, it's not alive anymore.

[Dave Ramsey]

It's all we know if it ever was. It's a zombie rib. Yeah.

[Caller]

So.

[Dave Ramsey]

Oh, my gosh, guys. So, hey, net worth. Net worth. Net worth. Net worth is how you measure success. And if someone says, well, a million dollars is not enough. It's not not. It's not enough for some of the things you want to do. A million dollars will not buy you a jet. Not a good one anyway. A million dollars will not buy you seven cars. People that have a jet and seven cars are billionaires. They're not millionaires. A billion is a thousand million. If you have a thousand million and you spend 8 million of that on a jet, you're okay. If you have 8 million and you spend 8 million of that on a jet, that was dumb. Okay, so, I mean, this is how the net worth works, right? I mean, you're looking at your ratios and you're going, okay, that makes sense. That's a million. No one should have a million dollars. A millionaire is a. Net worth is a math thing. It's not a moral construct. It's not a spiritual discussion. I can have that argument with you, too, and teach you about capitalism, how it is more intimately, more moral and ethically moral than any other form of government or economy. But that's not got anything to do with being a millionaire. It's just the byproduct. Millionaire is the byproduct of being free, having liberty to get up, leave the cave, kill something, and drag it home and not have it forcefully taken from you by your government. Oh, wait, they do that. It's called income tax,

[Caller]

Sam.

Foreign.

[Dave Ramsey]

Hey, guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now you can get that same kind of help anytime with Ask Ramsey, Ask your money question and get answers built on Ramsey principles we use on the show. Whether you're making a decision decision or just want something explained, Ask Ramsey is here to help. It's fast, simple and free to use. Go to ramseysolutions.com and try Ask Ramsey today. That's ramseysolutions.com. Jennifer is in Philadelphia. Hi, Jennifer, how are you?

[Caller]

Hi, I'm great. How are you guys today?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller]

Excellent. So I had a question. I'm a bit stuck right now. I am recently divorced. My ex husband and I, we own a home. It's probably worth at least $300,000. We have about 125,000 remaining on the mortgage. He's offering to let me stay in the house and split the equity later. But I have some student loan debt and car debt. If I sell and get out of the house, I feel like the equity would wipe out all of my debt and leave me with a decent emergency fund. So I'm just wondering, should I sell the house to get a clean break or try to day.

[Dave Ramsey]

How old are you?

[Caller]

I am 47.

[Dave Ramsey]

Your kids at home?

[Caller]

1. 19. 19 years old? Yes.

[Dave Ramsey]

How long were y' all married?

[Caller]

We were married 19 years.

Wow.

[Dave Ramsey]

I'm sorry.

[Caller]

Yeah.

[Dave Ramsey]

It's a hard thing to go through.

[Caller]

It absolutely is, yes.

[Dave Ramsey]

What do you mean make?

[Caller]

I make so gross pay this next year I'll be making a little over 100,000.

[Dave Ramsey]

And you said you're 40, what? 47.

[Caller]

47, yes.

[Dave Ramsey]

Okay.

[George Kamel Ramsey]

What's the mortgage payment?

[Caller]

The mortgage payment right now is 1890. And that's something that I've struggled with.

[Dave Ramsey]

My answer is more emotional than a is mathematical. And I'm answering this as what would I do if I were in your shoes? Okay. But it's the way I function, so I'm not sure it applies to you. You'll have to decide that. Okay. But for me, I think you make $100,000 a year. You're 100% free. If you sell this house, 100% of this heart rate break is in your rear view mirror. You're not walking into the same bedroom anymore. You're not walking into the same kitchen anymore.

[Caller]

Correct.

[Dave Ramsey]

And you have zero debt and you make $100,000 a year. You turn the page and chapter two begins.

[Caller]

Okay.

[Dave Ramsey]

I love the cleanliness of that and what that opens up your world as a world of possibility. Your life becomes a new adventure after this tragedy and this heartbreak and whatever words we want to use. For the past year and a half that you've gone through this or whatever it's taken to get this done and it's just been hell. And to put all of the burning embers of that trash fire, that dumpster fire in the rear view mirror for me and I'm making 100k and I'm completely free. I can do whatever I want. I like that more than I like this house.

[Caller]

Agreed. That is, that is my thought recently. It would be. It would be a great feeling to be debt free and planning for the future and the next chapter.

[Dave Ramsey]

Yeah. Knowing what I know now, I'm going to turn the page and chapter two is going to be a chapter of possibility abilities not burdened by anchors from the past.

[Caller]

Yes.

[Dave Ramsey]

I just, I. I personally think I get great hope and joy out of that idea.

[Caller]

Ah, yes, absolutely. And that is what I need right now. I need some. I need some joy and happiness back in my life again.

[Dave Ramsey]

Yeah. It cleanses some of the heartache and hope. Hope replaces some of the rage. And you know, I. Anytime you go through a life trashing thing. I've not been through a divorce, but I've been through a bankruptcy. Lost everything. And what they say about bankruptcy is it's a fresh start. Well, only if you do it right and only if you clean off everything when you do it. And we did and we had our fresh start, but man, it was, you know, we're standing there in ashes for a fresh start, you know, and in a sense, a little bit that's what you're doing. But you got, you know, you got a. There's a lot of positives in chapter two already. Freedom, adventure, sun is out. There's $100,000 a year income I don't have. You didn't tell me you got two. Two year olds to deal with. I mean.

[Caller]

No, no. Yes. I'm very close.

[Dave Ramsey]

Yeah. The 19 year old can figure it out. Well, that's not. We're not that far far off and.

[Caller]

Exactly.

[Dave Ramsey]

And not put them in the therapist's office too quickly anyway.

[Caller]

Yeah. Yes. Yeah. Teaching him. I'm encouraging him to listen to you and your show.

[Dave Ramsey]

Thank you.

[Caller]

And your team so that he makes responsible decisions, especially over the next few years of his life, so that he is.

[Dave Ramsey]

That he doesn't he doesn't use this family not turning out like he wanted it to, to be an excuse to do something dumb financially. That's a good idea on your part. Way to. Way to go. So.

[Caller]

Yeah.

[Dave Ramsey]

I don't know, George, you.

[George Kamel Ramsey]

Well, I think. Should you sell the house just to pay off the debt? Probably not. But for the reasons you mentioned, I love. And then the byproduct of that is, man, I get to just get rid of this debt, have an emergency fund, probably for the first time in a

[Dave Ramsey]

long time, and you can rebuild and buy a house pretty quick. And I'd personally rather live in a different house if it's me.

[George Kamel Ramsey]

Yeah. My guess is if you chose again today, you'd probably choose a different home based on your season of life.

[Caller]

I probably would. I'd want this a similar style, but maybe just. Just downsize a bit would be perfect.

[Dave Ramsey]

Yeah.

[George Kamel Ramsey]

Yeah.

[Dave Ramsey]

Yeah. I mean, I don't. I don't know if I was single, if I would live where I live. I never thought about it much, but I guess I would. I don't know. A lot of the reasons we're in there is because of Sharon, so I don't know if I would or not.

[George Kamel Ramsey]

Sharon.

[Dave Ramsey]

To think it's the reason we're in that particular neighborhood.

[George Kamel Ramsey]

Sharon wanted to live in a society, Dave. You wanted to live. Live in the woods.

[Dave Ramsey]

There you go.

[George Kamel Ramsey]

You know, she won. She won. Her vote mattered a little more on that one.

[Dave Ramsey]

Well, it's because that's how we've been married for 45 years. I told her, if she leaves, I'm going with her. So she took that to heart. We're not doing anything else. Yeah. Yeah. I love that. I think it's. There's a fun thing about having an encore. God talked about an encore career. You know, you lose your job in your 40s or 50s, and it was your. Your big thing. And a lot of people end up with their encore career and think about what an encore. The curtain goes down, the audience is on their feet cheering. The curtain goes up. You take a bow. The curtain goes down. And then the curtain goes up and you play another set. That's the encore. Right. And so that's what this is. It's the turning of a page. Chapter two. The curtain has gone up. It's your encore.

[George Kamel Ramsey]

It's like the old shamwow commercial. But wait, there's more. You always love that. We always want more.

[Dave Ramsey]

More Ginzu knives. Yeah.

[George Kamel Ramsey]

It's not over.

[Dave Ramsey]

Oh, what America do without infomercials.

[George Kamel Ramsey]

I love it.

[Dave Ramsey]

Qvc went bankrupt.

[George Kamel Ramsey]

No way.

[Dave Ramsey]

They did, Dave.

[George Kamel Ramsey]

You should have been supporting them.

[Dave Ramsey]

Probably not. Yeah. Can't see Dave calling in Micro. You know, Micro's career started on our buddy Mike. Started. He started on qvc. That's where he was. Yeah, that's where he started.

[George Kamel Ramsey]

That's fantastic.

[Dave Ramsey]

They found out he had a great voice and he entered the theater because of his voice. He doesn't left qvc.

[George Kamel Ramsey]

What I wouldn't give to have a voice deep and rich. And a great singer too. He does like opera.

[Dave Ramsey]

Oh yeah, big time. Big time.

[George Kamel Ramsey]

It's fantastic. Yeah.

[Caller]

And.

[Dave Ramsey]

And he went from theater to dirty jobs now figure that one out.

[George Kamel Ramsey]

But yeah, he's a renaissance man.

[Dave Ramsey]

Well, that he is for sure. But I love that idea. This chapter two thing is a good thing. Well, you can either treat life the. The next. What's the next thing? And there's just all this freedom and adventure and, you know, I'm going to backpack Europe or something. I mean, I'm not, but just kind of. What is it you want to do

[George Kamel Ramsey]

to the traveling pants?

[Dave Ramsey]

What's your thing? Yeah, that's.

[George Kamel Ramsey]

I, I love this. This concept of. Most people either treat it like a comma or a coma. You get to choose. Are you going to let this be preach?

[Dave Ramsey]

Is that like a sermon? That sounds like a sermon.

[George Kamel Ramsey]

I might. Maybe I stole that from a past driver.

[Dave Ramsey]

You might have stole that Sunday morning sometime.

[George Kamel Ramsey]

But I just love that idea.

[Dave Ramsey]

That's a great line.

[George Kamel Ramsey]

Are you gonna let this control you? Keep you frozen, stuck? Or are you gonna go, all right, there's a comma. The sentence is not over? Yeah, that thought might be, but there's a continuation here.

[Dave Ramsey]

When we filed bankruptcy, I did have that. I had a period of time where I just sat around and moaned and blamed everybody else and, you know. Cause that's what you do when you do something stupid. You blame other people. Right? And like McDonald's serves hot coffee. Who knew know. It's like, I'm gonna sue you. You served me hot coffee. You sue me if it was cold, you know, because you're that guy. But yeah, but instead I, you know, I sat around, blamed other people for my stupidity. And then I actually went to breakfast with a buddy of mine. I was whining and he said, you whine a lot. Ouch. He goes, you need to. You got a lot of lemons. You probably ought to make some lemonade and stop the whining. Oh, don't you love a good food friend, comma, and not a coma.

[George Kamel Ramsey]

You can use that one, Dave.

[Jade Warshaw]

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[Dave Ramsey]

Our scripture today 2nd Corinthians 8, 11. Now finish the work so that your eager willingness to do it may be matched by your completion of it according to your means. Margaret Phillips Marvin Phillips said, the difference between try and triumph is just a. A little oomph. I like that the right insurance acts as a shield around your loved ones and your wallet if disaster strikes. Our free insurance coverage checkup helps you figure out if you have the right coverage by giving you a personalized action plan with clear next steps. Go to ramseysolutions.com checkup and take the free coverage checkup and find out if you have the protection you need. Danielle is in Toledo. Hi, Danielle. How you are? How are you?

[Caller]

Great. Thanks for taking my call.

[Dave Ramsey]

Sure. What's up?

[Caller]

My question is our youngest child will be going to college in just over two years. So I've been reading about applying for financial aid, filling out the fafsa, all of that stuff. And I keep coming across suggestions that it is better if the parents and especially the child use their cap. And I'm not comfortable with that. We've had our son take the foundations course. We've gone through Financial Peace University. He's been saving up from his church job for college, and that goes against what we've taught him. And we feel he should pay for part of his college. But we also don't want to mess up our chance at financial aid.

[Dave Ramsey]

Well, there's several types of financial aid. There's scholarships, obviously, that are not based on financial need. They're based on, you know, academics, citizenship, other things. And we always suggest you go get as many of those as you can, and there's billions of dollars of those out there floating around, literally. Then we also, you know, there are grants that have to do with specific situations Nuances, demographics of your life or whatever, whatever. And grants are fine. There's nothing wrong with those. Financial aid that is needs based like a Pell Grant is for poor people. And when a website or a person suggests that you spend all your money in order to qualify for welfare, that's like saying quit your job so you can get welfare. No, we're not doing that. Like you said, that runs against what you believe and we're not doing that. So that's what that, that's the spirit in which these people are, you know. But financial aid is not all income or asset based. But that, that is, that is for poor people. And if you're not poor people, then don't spend your money or hide your money and act like you're poor people. So don't do that, you know, and then that solves your problem. So what I would tell you to do is to begin to look at the cost of a particular cost. College versus another college. That is a bigger difference number than anything you're going to find in fafsa.

[Caller]

Okay.

[Dave Ramsey]

And FAFSA really is a funnel to get people on student loan debt is mainly what it does.

[Caller]

That won't be allowed. There will be no student loans.

[Dave Ramsey]

Yeah, good. And you know, and if you qualify for a certain type of scholarship or grant, fine, take it. There's nothing wrong with, with that. But you're probably, you know, based on what you're telling me, you're probably not going to qualify for Pell grants.

[George Kamel Ramsey]

Yeah, I mean it's interesting to see the actual formula. I was looking it up. Your parent income is the biggest factor. So spending down all of your savings in cash is a very small portion of this. For Pell Grant for the FAFSA formula, the student aid index is what they call it. It's what they use for the formula. The parent assets is only 5.64%. So $10,000 in savings is only going to add 500 bucks to the parents portion. That is counted toward FAFSA. The student portion, the assets flat 20%. So he's got, if he has 10 grand, he has saved up. 2000 would be factored into the student aid index. So it's not as big of a deal as people think. And income at a point.

[Dave Ramsey]

Here's the thing. The truth is, is that we don't find people hardly ever that get through college using fafsa. They chosen, let's say you're student loan.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

Now you know. So FAFSA's really not the ticket.

[George Kamel Ramsey]

School choice.

[Dave Ramsey]

School choice is the ticket. Working while you're in school is the ticket. Applying for scholarships and looking for scholarships is the ticket. Those are the three things. And we find people doing all three of those all the time. I mean, we had Christina Ellis, that was with us for years, here is world renowned on getting scholarships. She wrote a book called How I Got a Half a Million Dollars in Scholarships. She ended up going to Vanderbilt and getting her MBA paid for in full and all of her undergrad too. And she was the daughter of a single mom who had no money. And so, you know, but it wasn't fafsa. She went and applied. She made it her job in her junior and senior year of high school to apply for scholarships. Her mother made it her job. She wrote so many essays, her fingers bled, you know, kind of thing. But she got a half a million dollars worth. Hello, that means free college, anywhere you want to go. The book was a best seller and she's still out there. And she's wonderful if you can find her information anywhere. But that concept is there. And that's what I would lean on. And then I would lean on school choice and what mom and dad can contribute and so on. But I wouldn't burn a lot of my brain calories trying to manipulate the FAFSA formula is the moral of this story.

[George Kamel Ramsey]

Yeah, not worth it. You're better off taking that time to just save up and pay cash.

[Dave Ramsey]

And for sure, don't, you know, don't spin down, man. People are so. That's a. You know what this is? It's the quintessential discussion between a scarcity mindset or an abundance mindset. A scarcity mindset says the government will have to take care of me because the little man can't get, get ahead.

[George Kamel Ramsey]

So therefore, why try?

[Dave Ramsey]

Therefore I'm stuck or spend it down or move all your money out of your name so that you go into a Medicaid nursing home. And that way the nursing home doesn't steal your money as if they stole your money. They provided a service. They don't steal money. They provided a service. They took care of you old people. That's what they were doing. But they stole. They took all. The nursing home. Nursing home got paid. You go to a restaurant, you pay them for the food.

[Caller]

Food.

[Dave Ramsey]

You go to the car dealer, you're paying for a car, you go to the nursing home. They stole all my money. See, that's a scarcity mentality. Now go for an abundance mentality and going, I'm going to stack cash and scholarships and a Good, inexpensive school and study something. Because knowledge is the key. Not degrees and not where you graduated from. Your knowledge is what moves you forward. Your degree is freaking worthless. And the only thing more worthless than your degree is where you went to school. That's so laughable. It's so stupid. I can't believe it. So choosing a school where you get quality knowledge to use in the marketplace and paying a reasonable fee for that and your kid works while they're in school. And let me tell you what, working while you're in college is not child abuse. Most of us worked while we were in college. Shut up, you entitled brat. You're going to work while you're in college. We don't have any money, we're broke and we're not going to take out welfare. You're going to work. That's how this is going to be. We're going to go to school. Well, my friends, I don't give a crap what your friends. My girlfriend, I really don't care what your girlfriend, because she won't even be your girlfriend by the time you get there, knows about that.

[George Kamel Ramsey]

That breakup is impending. I tell you from personal experience,

[Dave Ramsey]

this is how a boy from Boston ends up in Southern Mississippi.

[George Kamel Ramsey]

Yeah, that hurt. Dave doesn't even know where I got my degree from. If you tell you, that's how, that's how little he cares.

[Dave Ramsey]

I missed it. I missed it. No, I got it. I got it. The other day. We were telling the story the other day. That's how I remembered it.

[George Kamel Ramsey]

Yeah, good. But it really, it's.

[Dave Ramsey]

It's Danielle.

[George Kamel Ramsey]

That's a factor.

[Dave Ramsey]

Great question. Thank you for calling in with that and thank you for being a good mom and thinking this through and get that senior front and center on all this decision making where they're emotionally bought into what they're gonna have to do to get through school. 54% of the people that start college finish. Wow. That means colleges are failures. If you get a 54 on a test, they give you an F. 54% of you that start college finish ever.

[George Kamel Ramsey]

So then think about the ones that took on.

[Dave Ramsey]

The last thing you want is an almost degree. That's a really bad degree. The almost degree, that's a really bad one because you got all the student loan debt to go with it. So. And an interesting thing, people who pay for their school and their parents are paying for their school have a higher degree of completion. You know why? Skin in the game, baby. Skin in the game. That puts this hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.