Math Is Important but Behavior Change Is What Matters

Summary

Podcast Summary: The Ramsey Show – "Math Is Important but Behavior Change Is What Matters" (Released March 10, 2025)

The Ramsey Show, hosted by Ken Coleman and featuring expert Jade Warshaw, delves into the intricate relationship between financial management and personal behavior. In this episode titled "Math Is Important but Behavior Change Is What Matters," listeners are guided through various real-life financial dilemmas, emphasizing that while understanding numbers is crucial, altering financial behaviors is paramount for long-term success.

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1. Introduction

The episode begins with Ken Coleman and Jade Warshaw setting the stage for an energetic discussion focused on saving, investing, and increasing income. They emphasize their readiness to assist callers with their pressing financial concerns.

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2. Addressing Financial Dishonesty in Relationships

Caller: Darlene from Missoula, Montana – [01:04]

Issue: Darlene is engaged and discovers that her fiancé has been hiding significant financial issues, jeopardizing their ability to purchase a home together.

Discussion Highlights:

• Financial Transparency: Ken advocates for separate finances pre-marriage but stresses the importance of honesty once engaged.
• Premarital Counseling: Both Ken and Jade recommend professional counseling to navigate the emotional and financial complexities.

Notable Quote:

Ken Coleman [03:49]: "This is less about him lying about the finances. This is just about him lying. So we've got money problems, and you guys are about ready to tie the knot."

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3. Supporting Grandchildren with Special Needs and Financial Strain

Caller: Sarah from Atlanta, Georgia – [10:24]

Issue: At 56, Sarah is raising four grandchildren with special needs, facing mortgage burdens and multiple debts after her husband's passing.

Discussion Highlights:

• Debt Prioritization: Emphasis on eliminating high-interest debts like payday loans first.
• Community Support: Jade underscores the importance of seeking help through community groups or churches.
• Financial Coaching: Ken and Jade offer to connect Sarah with a financial coach for a tailored plan.

Notable Quote:

Jade Warshaw [18:09]: "You absolutely, I mean, you are running on fumes already. So you gotta get somewhere and you've got to tell your story."

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4. Balancing Financial Goals and Personal Desires for Travel

Caller: Colton from Denver, Colorado – [23:29]

Issue: Colton, preparing for a move, questions whether allocating $4,000 from his savings for a vacation to Japan is prudent.

Discussion Highlights:

• Financial Capacity: With no debt and a substantial emergency fund, Colton is encouraged to pursue his travel plans.
• Long-Term Planning: Ken shares personal anecdotes to highlight the balance between saving and living life experiences.

Notable Quote:

Ken Coleman [25:58]: "The bottom line is do you have any debt? The answer is no. And do you have a fully emergency, fully funded emergency fund? Yes."

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5. The Importance of Emergency Funds vs. Debt Repayment

Question of the Day: Catherine from Indiana – [33:31]

Issue: Catherine struggles to justify maintaining a $1,000 emergency fund while paying off credit card debt, having lived paycheck to paycheck for 25 years.

Discussion Highlights:

• Emergency Funds as Financial Safety Nets: Jade explains that an emergency fund acts as a buffer against unexpected expenses, preventing further debt accumulation.
• Behavioral Shift: Emphasizes building a savings habit to strengthen financial resilience.

Notable Quote:

Jade Warshaw [34:13]: "What changed my mind is kind of what you said here, which is for 25 years, you've been living paycheck to paycheck, which means your way hasn't been working."

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6. Managing Car Loans and Student Debt

Caller: Austin from Salt Lake City – [37:11]

Issue: Austin and his wife face significant car loans and $60,000 in student debt. They consider downsizing vehicles to manage payments but are concerned about their financial resilience.

Discussion Highlights:

• Debt Hierarchy: Focus on paying off high-interest debts first, such as payday loans.
• Income Strategies: Encourages leveraging skills to increase income and accelerate debt repayment.
• Community and Emotional Support: Reiterates the necessity of building a support network.

Notable Quote:

Ken Coleman [42:24]: "I really want you to get plugged in, in a church or into some community because you can't do this alone."

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7. Evaluating Career Changes and Their Financial Impact

Caller: Jeremy from Newark, New Jersey – [54:07]

Issue: Jeremy contemplates a job switch that entails an initial 40% salary reduction for long-term benefits and reduced physical strain.

Discussion Highlights:

• Financial Feasibility: Ken advises evaluating whether the reduced income can be sustained without incurring additional debt.
• Career Satisfaction vs. Financial Security: Balancing personal well-being with financial obligations is crucial.
• Debt Obligations: Emphasis on ensuring debts are manageable before making significant career changes.

Notable Quote:

Ken Coleman [58:51]: "I personally would not do this. However, from giving you advice. If you believe this is your best ladder for the future that you want and you can absorb the cut, 40%, one year, then it's only 30."

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8. Effective Debt Repayment Strategies for Retirement Stability

Caller: Patricia from Long Island, New York – [76:10]

Issue: At 68, Patricia faces $87,000 in Parent PLUS loans and seeks guidance to secure her retirement.

Discussion Highlights:

• Asset Allocation: Advises utilizing existing savings to eliminate high-interest debts, freeing up monthly income.
• Retirement Planning: Once debts are cleared, focus shifts to optimizing retirement savings and ensuring financial stability.
• Emotional Relief: Clearing debts not only improves financial health but also reduces stress and enhances peace of mind.

Notable Quote:

Jade Warshaw [82:14]: "Yeah, you're unstoppable. ... And now that you have the money and the freedom to pursue this, get to the end of your life and reminisce. Not regret."

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9. Final Thoughts: Behavior Change as the Key to Financial Success

Throughout the episode, the recurring theme underscores that financial success isn't solely about understanding numbers but fundamentally about changing behaviors. Whether it's maintaining transparency in relationships, prioritizing debt repayment, or making informed career choices, altering one's financial habits is pivotal.

Key Insights:

• Budgeting is Essential: Establishing a clear budget helps in tracking expenses and aligning them with financial goals.
• Community and Professional Support: Leveraging support networks and seeking professional advice can accelerate financial recovery.
• Prioritize High-Interest Debts: Eliminating debts that drain financial resources provides greater stability and freedom.
• Balance Between Saving and Living: It's important to find a middle ground where one can enjoy life experiences without compromising financial security.

Notable Quote:

Ken Coleman [83:42]: "Earn while you live. That's the point of the baby steps because it allows you to get out of debt and live freely."

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10. Closing Remarks

Ken and Jade reaffirm their commitment to guiding listeners through their financial journeys, highlighting upcoming events like the Money and Relationships Tour. They encourage listeners to reach out with their financial questions, emphasizing that with the right behavioral changes, financial stability and prosperity are achievable.

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Conclusion

"The Ramsey Show – Math Is Important but Behavior Change Is What Matters" effectively illustrates that while financial literacy lays the foundation, transformative behavior is the true driver of wealth building and financial independence. Through diverse caller scenarios and expert guidance, the episode offers actionable insights for listeners striving to overcome financial obstacles and cultivate healthier financial habits.

Transcript

[Ken Coleman]

This is the Ramsey Show. It's where you hang out, America, to talk about your life, specifically your money, your profession and your relationships alongside the incomparable, the inimitable Jade Warshaw. I'm Ken Coleman and we are here for you this hour. Triple 8825-5258-8885-5225 is the number. You ready to go? You're in your spring corduroy.

[Jade Warshaw]

Yes, I am.

[Ken Coleman]

I like this.

[Jade Warshaw]

It is. Spring has sprung. It has in the Nashville area.

[Ken Coleman]

All right, that means we got a little extra energy for you folks today. Jade's going to help out on how to save, how to. How to invest the money, and I'll help out on how to make more money. So it's quite a combo, if I do say so myself. We start off with Darlene in Missoula, Montana. Darlene, how can we help today?

[Caller]

Hi, how are you? I called in on the show. Just try to see what kind of help we could get and guidance in regards to my other half has been hiding some things financially, and I'm having difficulties with that and trying to get. To communicate with him to resolve so we don't lose our house.

[Ken Coleman]

What happened? Is this a new revelation?

[Caller]

Well, he's always not been real good with money, but, I mean, he does try his best. And even though we're just engaged, we don't. We don't have our finances together. He pays his things on his own and I pay things on my own. We've never really sat down and gone over our finances with each other, but it. It's just he's got himself in a predicament and.

[Ken Coleman]

Well, but hold on a second. I asked you this and you kind of feels like you went a different direction. I asked you, is this a recent revelation that he's not been honest with you? I love that your finances are separate. They should be. That's exactly what we would tell you if you asked us that you aren't married yet. So my question is, is this something new that you have found out? And how did you find out?

[Caller]

Well, I have to say yes and no. I know he's not been that great with money, but to this extent is new how I found out. I'll try to keep it short, but you know how you have. You connect with your vehicles. And I was pulling up in our driveway from running errand and his phone actually connected. He was on the line with, I guess some loan agent from. From his. From his loan company. And I heard something about a forbearance or a deferment. And so I sat in the driveway and tried to listen as long as I could, and then the call disconnected. And then I came in and went downstairs and confronted him. And even though I confronted him on this, he still continued to lie about how far behind he was.

[Ken Coleman]

Okay, all right, well, that's. That's all. Thanks for sharing that. That helps Jade and I, in trying to encourage you, because this is less about him lying about the finances. This is just about him lying. So we've got money problems, and you guys are about ready to tie the knot. When is. When is the big day?

[Caller]

We haven't really set a date, to be honest with you. I've been comfortable with just the engagement the way that it is, and I just. I want things to be more stable.

[Ken Coleman]

All right, so how can we help you? So now we've got a good idea of what's going on, and I'm troubled. If I could play Big Brother for a moment. I'm concerned because this is a real problem. We know that financial issues cause a lot of marriage stress. Number one, it's well documented. And then, number two, there's dishonesty here. And so I'm very concerned. So how can we help you best today? What can we do?

[Caller]

Well, I mean, I'd obviously don't expect any type of relationship or marriage counseling. I do know I'm good with money. I think everybody can always be better with money. What I want to do is to be able to get him to sit down and to be completely honest about finances in general. No how. No matter how bad it is, we really need to get to the root of the problem and to be able to sit down, look at his finances, my finances, and try to be able.

[Jade Warshaw]

To rectify what happened when you confronted him. Because. And depending how the confrontation went, it feels like that would have been a time to kind of come clean with everything, did he not. What happened when you confronted him?

[Caller]

When I confronted him and he knew that I heard the conversation on the phone, I tried to sit and Google in front of him what deferments were and what forbearances were. Just to educate myself and figure out. Exactly. Yeah. And if I'd have tried to figure out what he was actually doing and what his plan was, and when I started reading off and trying to figure out whether forbearances is added onto the back of your loan, to the end of your loan or if it's a balloon payment, and I looked at him and I said, well, forbearance to say that you had to be four months behind. I said, you just said you were a little bit behind.

[Jade Warshaw]

And what do you say to that?

[Caller]

No, he said, no, I don't want to be that far behind at all. Well, then there was another lie. He was already four months behind.

[Jade Warshaw]

Okay, so let me ask this because there's two things that I'm sensing going on. Number one, your boy was caught in a lie, and you probably came in hot and heavy. I would too. Like, I'm not saying that you shouldn't have. I would have been like, say what? So I understand that you probably came in there really strong. And so for some personalities, that's like shutdown mode. Like, it's like, I, I, I, I like the, the cartoons. So he, he may not, he might have just been trying to get through the situation, which is probably why he wasn't giving more information. That's thing number one. But did you guys come back later on in calmness and be like, okay, let's sit down and talk, because here's what's gone. And when that happened, what, what could you derive from that? Because it is possible people don't always know. When people don't know what's going on with their money and they get behind, sometimes they're still like, okay, what's going on? How many months in it? He might not even understand it. So have you guys sat down now calmly to talk through everything that's going on?

[Caller]

We have a few times, yes. It's been little conversations. And when it kind of gets a little bit more heated, we step aside a little bit and take another day and then sit down and look at it again so we both don't get so upset or he doesn't attacked or any more ashamed. And he says he feels like a failure. And.

[Jade Warshaw]

Okay, so you guys are talking about it and it kind of does. I mean, can you can jump in here? It does kind of sound like what I would expect a situation like this to sound like, because contrary to popular belief, money stuff is not a light switch. Like, it doesn't, it's not one conversation. And over. It does tend to spread into many conversations that have a life of their own. Because the truth is, there is he has made a mistake. I'm not trying to sugarcoat that. But there's a lot of shame around the choices that people make with money. And so it can take a while to really be able to talk about it in a way. And I think what you're saying seems right. You talk about it a while when it Gets too hot and heavy, you cool it down, you come back to it later like that. What you're describing really does sound like you're on the right track. And what I would be listening for is as long as you don't feel like he's still hiding things, then I think that you're on the right track. And this is just something that you guys are going to uncover and it's going to be a continued journey.

[Ken Coleman]

Yeah. However, I agree with all of that, but I think this ought to be premarital counseling.

[Jade Warshaw]

Yeah. Yes.

[Ken Coleman]

Because you actually need a professional who can help you navigate his feelings. His feelings are very real and as a result, very powerful. In other words, there's a lot of shame. What I heard is he. Shame.

[Jade Warshaw]

Yeah.

[Ken Coleman]

And he needs to know that you aren't judging him. He needs to know that you aren't holding an ultimatum over his head, but that you don't feel safe because of the way he does money. And this is about us moving forward, having a healthy and prosperous marriage, not what you've done now or what you're dealing with. I'll help you. I'll dive in going forward. Hey, babe. I'll handle the finances. And you don't have to worry about it because it's my thing. It's my jam. Like, that has to be facilitated through a real marriage pro. And I could not recommend. I think your next steps are, hey, we're doing this for us so that there's no judgment. Sit with me in there. They'll keep me in check so that I don't shame you. Come at it that angle and just say, please, do this for us, and it's going to be okay. No shame, no nothing. No condemnation. I think that's the play. But I do believe that this is premarital counseling. There's not a money issue right now. It could be, but it's actually not. And that's why I would do that. So thanks for the call, Darlene. Thanks for trusting us. I think it's going to be okay if you approach it that way. And you guys stick through the therapy. Quick break. We'll be right back. This is the Ramsey Show.

[Jade Warshaw]

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

[Caller]

Way, and that way isn't down.

[Jade Warshaw]

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[Ken Coleman]

Welcome back to the Ramsey Show. So glad you're with us today, America, alongside Jade Warshaw. I'm Ken Coleman, and we're here to coach you up. 888-825-5225. That's the phone number. Sarah is going to join us now in Atlanta, Georgia. Sarah, how can we help today?

[Caller]

Hi. Yes, sir. I'm 56 years old. And first of all, thank you for taking my call.

[Ken Coleman]

You bet.

[Caller]

I'm 56 years old and I have four grandchildren that I am now raising.

[Ken Coleman]

Oh, my.

[Caller]

I was in a perfectly good situation before I got the kids. I had, you know, money in the bank. I was working for an airline and I was doing really well. And I got the call, either come and get the kids or they're going to state.

[Ken Coleman]

Oh, my goodness.

[Jade Warshaw]

Oh, no.

[Caller]

Needless to say, I came back.

[Ken Coleman]

Oh.

[Caller]

And I had to spend everything I had.

[Ken Coleman]

Yeah.

[Caller]

And I took the kids, got a place as quick as I could because I, I was, I gave up everything to travel. My husband passed away. My husband, I mean, my mom passed away. So it was like it was only me, you know?

[Ken Coleman]

Yeah.

[Caller]

So here I'm gonna live my life. And so I had to come back and I had to try to get a home. I had to try to get the furniture. I had to try to get, you know, and I was getting all this to keep them out of the system. And now it's been five years and I am, like, broke. I don't know what to do.

[Jade Warshaw]

Oh, Sarah.

[Ken Coleman]

Well, first of all, you're such an amazing grandma. I'm telling you, you stepped up and we're going to help you. We're going to help you. So give us the scenario. Where are you at? Where are you financially? Or did you, did you accrue any debt?

[Caller]

A lot.

[Ken Coleman]

Walk us through that.

[Caller]

From having, I went, from having 63,000 in the bank and was going to put more, you know, as I was traveling.

[Ken Coleman]

Sure.

[Caller]

But all that's gone because I had to get a lawyer, I had to get the house, I had to get furniture. I had, you know, and it was just, I, I spend it all.

[Jade Warshaw]

Okay.

[Ken Coleman]

It's okay. We want to get you out of this. What are you, what's your debt from that.

[Jade Warshaw]

Real quick, Sarah, tell me, where did you used to live, where did you travel from and where do you live now?

[Caller]

I live in Georgia now and when they called me, I was in Paris.

[Jade Warshaw]

Paris.

[Ken Coleman]

So I had France.

[Caller]

Paris, France. Yeah, I was traveling. Yeah. I didn't live anywhere.

[Ken Coleman]

She didn't have a home.

[Jade Warshaw]

Got you. Okay. I was confused about that. So now you're in Atlanta. Old are these kids?

[Caller]

These kids. The youngest is six. Then there's eight year old identical twin boys and then a 12 year old little girl.

[Jade Warshaw]

Okay. Okay.

[Ken Coleman]

She's got a ways to go now. Do you have full custody of them now? And all that's settled, so.

[Caller]

No. Yes, all that settled and.

[Ken Coleman]

Okay. All right.

[Caller]

And now it's all on me. So I'm mama, you know, basically.

[Jade Warshaw]

What are you doing for work? You're not doing the travel agent thing anymore?

[Caller]

No, I can't. I was working with a local company and then they let me go. So I went from having around 4300 and income down. I mean from 6500 having income down to 4300. And this is where I, I lost it. This is where I'm, I'm like losing everything because I don't have enough.

[Ken Coleman]

So what, what are you doing now?

[Caller]

Sitting. I'm doing pet sitting. I go to people's houses and pet sit. The reason I don't do a reg 9 to 5 type job is kids are special needs.

[Jade Warshaw]

Okay.

[Caller]

Yes.

[Ken Coleman]

Is that why you lost your job before?

[Caller]

That is. Yes, that is the reason why I lost my job.

[Jade Warshaw]

Okay, so you're in Georgia. Is there anybody? Is it. It's just you and these kids? There's no other family? You mentioned your mom passed.

[Caller]

Yeah, no other family. It's just me.

[Jade Warshaw]

And how many of the kids have special needs?

[Caller]

All four.

[Jade Warshaw]

Okay.

[Caller]

There's. They were born on drugs.

[Ken Coleman]

And so a lot of medical stuff still going on.

[Caller]

A lot. Lot of medical and a lot of emotional, behavioral.

[Jade Warshaw]

Okay.

[Ken Coleman]

And so where's, where's, where's most of your money going? Is it for therapy and, and the medical stuff? I'm guessing that's extremely expensive.

[Caller]

Yes, that. Well, they do get Medicaid. Thank goodness for that. You know, that does help.

[Ken Coleman]

Okay.

[Caller]

But most of the money now since I had to get a mortgage goes to the mortgage. And I had to get, you know, the mortgage right now is off the chain. So what is the mortgage I do is I do a 6.25% now and my mortgage is $1748 a month. That's most of it right there.

[Ken Coleman]

And is it a house?

[Caller]

Just a mortgage? Yes, it is a house.

[Jade Warshaw]

Okay.

[Ken Coleman]

Whereabouts?

[Caller]

Actually, I'm in like southwest area Georgia.

[Ken Coleman]

Yeah. And the reason I, I'm asking because I know that area very well. I lived down there for a long time, so just curious. So you're, you're south of the airport?

[Caller]

I am, yes. I am. Like near Albany.

[Ken Coleman]

Okay, gotcha. All right. All right, let's walk through the debts really quick because we don't have a ton of time left and we're going to get you some help here. But let's give Jade a quick snapshot of your total debt. We know the house well. Let's just quickly get that. How much is, how much is the house worth today? Do you have any idea versus what you owe worth?

[Caller]

It's worth 235,000 and I owe 217,000.

[Ken Coleman]

Okay, so you don't have much there. Okay. And now go through the rest of your debts. Smallest to largest.

[Caller]

Credit card debt. I got several of those. All of them together is around 6100. I pay 385amonth.

[Ken Coleman]

Okay.

[Caller]

Furniture bills, I pay 8. 7. 8 4, 7amonth.

[Jade Warshaw]

Is that, is that a one time purchase? The furniture bill, you just put it on a loan or is it something that's like a rent to own deal?

[Caller]

It's, it's sort of like a rent to own deal.

[Jade Warshaw]

Okay, how do we get out of that? Because what are you paying a month?

[Ken Coleman]

847.

[Caller]

Okay, 8:47amonth.

[Jade Warshaw]

Now how is there a way to get out of that? Because that's going to be a revolve. Like you're going to be in that forever if we don't, if we don't get out of it now. And that's a lot of money.

[Caller]

Yeah, it's, it's another year on it. Okay, 47amonth. I don't know how.

[Jade Warshaw]

Okay, that's your homework. One of the things that I want you to do getting off of this call is to find out how I can get off of this. Because this for a whole nother year is a lot of money. I'd rather you just go over to Walmart and make it happen for. For $847 for in one month than to continue paying this.

[Caller]

Right.

[Jade Warshaw]

How much furniture does that include?

[Caller]

All the beds, the couches, the kitchen table, includes everything in the house. I had to get something, so this is how I did it.

[Jade Warshaw]

And then after the year, you'll own it?

[Caller]

Yes.

[Jade Warshaw]

Okay.

[Caller]

It's 5,229 total to pay it off.

[Jade Warshaw]

Okay. Keep going down the debt. What else do you have?

[Caller]

I have basically that's all the debts is the furniture bill and the credit cards. And then my stupid butt got some payday loans I'm going to work on getting.

[Jade Warshaw]

What do you owe on the payday loans?

[Caller]

2400 total.

[Jade Warshaw]

Okay.

[Caller]

1320Amonth.

[Jade Warshaw]

Okay. So, yeah, you're right. Those payday loans, those will suck the life out of you. So I want those at the very, very top of the list. Do whatever you can to get those things out. I. I really, really want, and I know that this doesn't happen overnight, but if you find the right folks, it can. I really want you to get plugged in, in a church or into some community because you can't do this alone. You absolutely, I mean, you are running on fumes already. So you gotta get somewhere and you've got to tell your story.

[Ken Coleman]

That's right.

[Jade Warshaw]

And you've got to let people hear what's going on, people who care. I want you to get to a local church. I want you to get plugged into a life group, and I want you to start saying what's going on, because anybody else that hears that is going to go. If you came into my life group today, I'd be like, what can I do? Instantly. Do you see what I'm saying? So getting people around you is paramount to making this work. Okay? Right.

[Ken Coleman]

And by the way, because we're running out of time, I want, I want to set her up, Christian, with one of our financial coaches. Please, let's get it. Let's. Let's gift her a session so that there's just a little bit more time and they can help you with a plan because we just cannot cover all of this in the small time we have with you. Secondly, Christian, you've done this before. Also. Let's figure out what churches we know in the area where she lives specifically. We will also make some connections to this church for you or churches. And I cannot say what Jade said is absolutely the number one thing you gotta do right now. Now, the coach will help you. Our coach, financial coach, will help you. And come up with a game plan. But you gotta go tell your story because people's hearts will break with yours and you will get help. You've got to be okay to say, I need help. No shame in your game. Sarah, you stepped up. You did what you did. No one's judging you, including us.

[Jade Warshaw]

Everybody just wants some help. Yeah.

[Ken Coleman]

Yeah. So hang on line. Christian's amazing. He'll take good care of you. Sarah, help is on the way. Keep your chin up. There's a plan. This is the Ramsey show.

[Jade Warshaw]

All right, Dave, you have some strong opinions, possibly. Yeah, I think so. Okay. Because you really prefer credit unions over big banks. So why, why is that?

[Caller]

Well, credit unions, for one thing, are non profit, which means that the members, the customers own the credit union.

[Jade Warshaw]

So any profits that the credit union.

[Caller]

Makes goes back into customer pricing so.

[Jade Warshaw]

You get better interest rate on savings.

[Caller]

Cheaper checking and so on, that kind of thing.

[Jade Warshaw]

And.

[Caller]

But that's what's more important than that, though, is the fact that the customer is the owner, changes the spirit on the credit union.

[Jade Warshaw]

So I find very few credit unions.

[Caller]

That aren't very customer centric.

[Jade Warshaw]

Yes, well, and I think we have found one that is incredible and that's Fairwinds. They are an incredible credit union that is really out with the heart to help the customer.

[Caller]

You know, that's why we're partnering with them, because they've got a scope to be able to handle the Ramsey audience. And they're the right kind of people with the right kind of values and they've done a really, really good job with customer service and the deals that they're offering. The Ramsey Tribe is incredible.

[Jade Warshaw]

Yeah, absolutely. And you're right, their customer service is unbelievable. Winston and I just signed up and we got an account.

[Caller]

Yeah.

[Jade Warshaw]

And I'm not kidding, it took. It took less than five minutes. It was so user friendly. Like the step by step approach was unbelievable. And then the next day my phone rings and it says, fair wins on my phone. So I answered it and talked to someone there and they said, yeah, they give calls to every new customer. And so again, they just really care about your experience. And I, I so, so appreciate that. So again, you guys, I know it can be a pain to switch banks or to open up new accounts, but Fairwinds, again, they make it so easy. Plus, anything that you can do at a traditional branch, you can do with [e-mail] or on their app. And you'll have free access to over 33,000 ATMs.

[Caller]

You guys know how much I hate Banks in general. And so for me to do this is a big deal. Talk to our friends at Fairwinds and check out the combined checking and savings bundle that they created just for the Ramsey tribe. You guys, it's incredible.

[Jade Warshaw]

Yeah, you guys, it's so easy to join Fairwinds no matter where you live. So go to Fairwinds.org Ramsey to learn more. That's F a I r w I n d s.org Ramsey.

[Ken Coleman]

Welcome back to the Ramsey Show. I'm Ken Coleman. Jade Warshaw is alongside triple 882-55-5225 is the phone number to jump in. All right. It is possible to break the cycle you've been stuck in. I'm just telling you it's possible. It might seem as though you're just never going to get out of it, but it is possible. And we're talking about your money and your relationships. There's such a tie there. Dave Ramsey and Dr. John DeLoney are hitting the road to show you how to break out of the cycle. It's called the Money and Relationships Tour. They're going to talk about raising great kids, handling money fights, making real friends and more. This is the turning point you've been looking for, and the time is running out. The dates are Louisville on April 21. Durham, North Carolina, on April 23. Atlanta, Georgia, April 25. Phoenix, Arizona on May 5. Fort Worth on May 7. Kansas City on May 9. Ramseysolutions.com tour is where you get the tickets. Or if you're watching on YouTube or listening via your favorite podcast app, click the link in the show notes. It's the Money and Relationship Tour. Dave Ramsey, Dr. John DeLoney coming to a city maybe near you. So go check out the details and get your tickets now. Colton is up in Denver, Colorado. Colton, how can we help?

[Caller]

Hey, Mr. Coleman. Hi, Mrs. Warshaw. How are you guys doing today?

[Ken Coleman]

Well, I just feel about 15 years older now.

[Jade Warshaw]

It was very formal.

[Ken Coleman]

Mr. Coleman and Mr. Warshaw with you today, folks. We're here to take care of business. What's going on, Colton? How can we help? We appreciate the respect Jade feels. She doesn't feel like the president.

[Jade Warshaw]

This is wonderful. First lady.

[Ken Coleman]

Yeah, y'all.

[Caller]

Y'all deserve it. I've been following Dave Ramsey from the student program that I took back in high school. Back in, oh, gee, 2016.

[Jade Warshaw]

Okay.

[Ken Coleman]

All right.

[Caller]

So I was wondering if I can afford to go on a vacation to Japan next year.

[Jade Warshaw]

Ooh, I love these questions.

[Ken Coleman]

I particularly like this question because, full disclosure.

[Jade Warshaw]

Yeah.

[Ken Coleman]

Japan is on my top Five list of places to go. Interesting that I've not been. Okay, so I'm a little interested in this. All right, Colton, how much is it going to cost?

[Caller]

Well, you know, I've been budgeting for it. I'm looking at it and planning on taking it October of next year. So I got some time to save for it and budget for it, and I'm estimating the cost to be around 4K.

[Ken Coleman]

4K. All right.

[Jade Warshaw]

Okay.

[Ken Coleman]

And do you have any debt?

[Caller]

Nope, nope. I paid off my truck last year in July and I have about 15 grand in savings right now and I estimate that to be about 35 grand in savings.

[Ken Coleman]

Is that your emergency fund?

[Caller]

That is my emergency fund. That is everything.

[Ken Coleman]

And so what is a fully funded emergency fund as we define it? Three to six months. What's that for you?

[Caller]

For me? So I still live at home. Currently I'm moving out in July and I estimate my expenses to be of about 2100amonth to 2,400amonth.

[Ken Coleman]

Okay, so you've already got. So the 15,000 is a fully funded emergency fund and then some for you?

[Caller]

Yes.

[Ken Coleman]

And you're going to be able to, you're going to be able to cash flow between now and next October, easily the four grand to cover the trip, yes or no?

[Caller]

Yes, I should be able to. But I'm also wondering if it's too much of my net worth because 4 grand relative to 30, 35 grand is a good chunk of money.

[Ken Coleman]

Yeah, but that's not. I don't. We don't have a net worth calculator as your vacation. The bottom line is do you have any debt? The answer is no. And do you have a fully emergency, fully funded emergency fund? Yes.

[Jade Warshaw]

How long's the trip?

[Ken Coleman]

Have you been investing 15% of your of your income into retirement?

[Caller]

Haven't started investing yet. My company doesn't do a 401k match and I'm still just bulking up to. To move out. And that's why I've been saving probably about 70% of my.

[Ken Coleman]

Here's my deal. I'll get out of the way and cede my time to my financial expert partner over here. I just see no issue with you coming up with four grand. Even if you're investing 15%, which you need to be doing, you coming up with four grand between now and October 2026.

[Jade Warshaw]

That's no problem.

[Ken Coleman]

Is a non issue, my man. So I would say go to Japan.

[Jade Warshaw]

How long's the trip?

[Caller]

Me and my friend are still working that out. He's coming along to also paying all cash, so he'll be good to go.

[Jade Warshaw]

Doesn't that have to do with your work? Like, how does that conflict with your work is all I'm asking.

[Caller]

You know what? Thankfully my job offers me generous amounts of PTO. And I do mean generous amounts of PTO. I have 24 days to burn this year.

[Jade Warshaw]

So your only question then was just your only net worth? Like, hey, is this too big of a piece of my net worth to do do this?

[Caller]

Yeah.

[Jade Warshaw]

No, it's not. No.

[Ken Coleman]

And you only live once, bro. The fact that you're paying cash for this.

[Jade Warshaw]

Yeah. You're young. How old are you?

[Caller]

I'm 24. I'll be about to turn 26 by the time we take the trip in October. My birthday's end of October, So. Okay, so 26.

[Jade Warshaw]

My only caveat is I would be moved out of my parents house before I went and did this. Like, to me, at your age, that's really important. And so I would not want this trip to push me from not doing that. That would be my only piece to this.

[Caller]

No, it's not gonna push me from that. I'm moving out in July. I'm moving out to a college town. Not to go back to school. That's just where I want to live. It's gonna be Laramie, Wyoming, and you know, that's where my expenses and rent fits and do it. I want to live. So.

[Ken Coleman]

All right, so listen, I'm gonna preview my talk on the Ramsey cruise.

[Jade Warshaw]

What talk? What's it about?

[Ken Coleman]

It's. I'm about to tell you. It's. It's the answer to why he's calling it. Okay, My talk is for decades, Davis said live like no one else. That's the baby steps.

[Jade Warshaw]

Yeah.

[Ken Coleman]

So that later you can live like no one else. And then he eventually added and give like no one.

[Jade Warshaw]

Right, right, right.

[Ken Coleman]

Okay. But living like no one else. But the, the crux of my talk, because all these people on the cruise are baby step four and higher. Okay. Is don't get to the end of your life after you're doing all this hard work to live like no one else and not actually live like no one else. Which means when you're 24 and debt free.

[Jade Warshaw]

Come on.

[Ken Coleman]

Going to Japan for four grand because you can and you come back with a great experience and no stress, that's living like no one else.

[Jade Warshaw]

Is our talk the same? Because I feel like I'm talking about the same. I'm talking about being in your spending era and my job, my guy is in his spending era.

[Ken Coleman]

I'm not talking about the money part. I'm going to say on the other side of all this hustle now we go from intensity to tensionality. And let's talk about the regrets of the dying. I'm going to share the regrets.

[Jade Warshaw]

Okay. The regrets of the dying.

[Ken Coleman]

What we know from.

[Jade Warshaw]

From tons of studies tell us some of them. Can you. Without.

[Ken Coleman]

Yeah, Without. I won't give the whole talk. But it's. I didn't live true to myself. Like, I've tried to please everybody else.

[Jade Warshaw]

Oh, man. Yeah.

[Ken Coleman]

I didn't spend enough time with friends. I didn't spend enough time with family, like, these type of things. And so I'm going to equate it to now that you have financial peace. What is living like nobody else look like. And I'm going to actually spin. I'm going to flip the regrets.

[Jade Warshaw]

So instead of so much.

[Ken Coleman]

Instead of a regret, I'm going to go, here's the flip side to this regret, and I'm going to name it. And now that you have the money and the freedom to pursue this, get to the end of your life and reminisce. Not regret. That's the final.

[Jade Warshaw]

That's very good.

[Ken Coleman]

So I would say, Colton, I believe in this so much. That's the talk I'm doing, essentially. And I think at 24, being debt free, if you don't go to Japan, it's the type of thing you might regret one day. And where none of us are promised tomorrow. So while I'm living. This is from the Broadway show redwood with idina menzel that Stacy and I just saw. There's a song and there's a lyric in the song that says live while you're living.

[Jade Warshaw]

Okay.

[Ken Coleman]

And I'm gonna go ahead and borrow that. I probably botched that lyric.

[Jade Warshaw]

I'm with you. I thought you were going to Sinatra.

[Ken Coleman]

No, I just think that when I'm living. Live.

[Jade Warshaw]

Yeah, that's right.

[Ken Coleman]

Live. And I think this is. This meets all of the requirements for us saying, you know, Davis said for years, don't let your vacation come home with you.

[Jade Warshaw]

I agree. Yeah.

[Ken Coleman]

By putting it on a credit card.

[Jade Warshaw]

But he's got the money and why wait that. I think what, Ken. What, Ken, what you're saying is so, so smart and so true. We see that with home buying. We see it with vacations. It's kind of like people are gun to actually, like you said live. And I'm like, you have the moment. Take it. No one Is no. People only want your time. They only want to suck things from you and take things from you. People rarely will push you to do those things.

[Ken Coleman]

Yeah.

[Jade Warshaw]

There will always be an excuse like why you got to work more, why you can't go, why you can't do it. Just go.

[Ken Coleman]

This is my new qualifier. Colton, Jay and everybody else. When. When given an opportunity, I sit there and I think, is this something that if I'm an 85 year old man in my final days that I'm gonna look back on and go, I wish I had done that, man.

[Jade Warshaw]

I tell you what, I'm glad that my talk comes before yours because they're kind of similar.

[Ken Coleman]

Hey, if there's karaoke on the cruise, will you sing that song you just talked about? Yeah, if, if, if Jade works with me on it. Like, she's gotta make sure that I can get all the keys. Yeah, yeah, yeah. She's a pro. If she coaches me. Sure. Maybe does a duet with me.

[Jade Warshaw]

I don't know. On the last.

[Ken Coleman]

If I could do like a Kirk Franklin version. Like, Kurt never actually sings, but he surrounds himself with great singers. That's more me. I say a couple lines with some.

[Jade Warshaw]

Okay, okay.

[Ken Coleman]

While you're singing. This is the ramsey show.

[Jade Warshaw]

There's a time in your life and did the baby steps for renting. But you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget because it always goes up, never down. So when you're ready to buy, make sure you work with a mortgage partner. You can rely on churchill mortgage. Churchill is Ramsey trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy a home the Ramsey way, your mortgage payment will be a consistent, manageable part of your monthly budget. Plus, when your home is paid off, that was your largest expense. Now it's extra money in your pocket and an asset towards turning you into a baby steps millionaire. So get started on the American dream of homeownership [e-mail] that's churchillmortgage.com this is.

[Ken Coleman]

A paid advertisement and MLS ID 1591 in mlsconsumeraccess.org Equal Housing Lender, 1749 Mallory Lane, Suite 100, Brentwood, Tennessee, 37027. Welcome back to the ramsey show. I'm ken kulmejade. Warshaw joins me and we're here for you this hour. 888-825-522. 2, 5. Before we get to the phones, it's time for our Ramsey show. Question of the day, brought to you by Y Refi with why Refi? You can take control of your defaulted private student loans with a plan that works with your monthly budget. Visit yrefi.com Ramsey that's the letter y r, e f y.com Ramsey it may not be available in all states.

[Jade Warshaw]

All right, today's question comes from Catherine in Indiana. She says, how do I rationalize having $1,000 emergency fund when I could be using it to pay off debt? I've lived paycheck to paycheck for 25 years, and I've always managed to cash flow any emergency. I have a hard time rationalizing putting money in the bank now when I could put it towards credit card debt. I can't get past this feeling that having savings is for those people and not me.

[Ken Coleman]

Fascinating.

[Jade Warshaw]

That is fascinating. I mean, let me tackle this from a couple of areas. First and foremost, I want to say that when I first started the baby steps, I felt the same way. I was like, oh, you did? Yes.

[Ken Coleman]

You were so intense. Because this says intensity to me.

[Jade Warshaw]

Let me tell you. I specifically remembering arguing with Sam because he was like, jade, we have to walk the steps the way they're written. And I was like, but we need this thousand dollars to go towards our credit card payment. Like, I.

[Ken Coleman]

Which I understand that.

[Jade Warshaw]

Yeah. Because you're desperate and so you're, like, trying to, like, put out the fires and stop. Bleed bleeding. Stop the bleeding. So I validate the way you're feeling. However, what changed my mind is kind of what you said here, which is for 25 years, you've been living paycheck to paycheck, which means your way hasn't been working.

[Ken Coleman]

That's right.

[Jade Warshaw]

That's really. And so I had to do the same thing. I had to go, here's the thing. I'm in $460,000 of debt right my way, and my instincts have not served me well up until this point.

[Ken Coleman]

Was there? Okay. But I also know you. You're probably one of the most principled convicted people I know. And that's a compliment.

[Jade Warshaw]

Yes.

[Ken Coleman]

So what changed is. Was it something that Sam said? What. What made you finally go. And I know you just kind of said it, but.

[Jade Warshaw]

No, no. There was an I've had moment. There was an I've had it moment. So the I've had it moment was we continue. We. Because we didn't have the thousand dollars because we were trying to put out fires as they came, we weren't making as much progress as we should have been making and not having that extra little bit of money when, when unexpected things come up, I just felt like we were taking, you know, two steps forward, one step back, to like just going very, very slowly. And I just remember one time just being like, pull the car over. Like, I can't. We've got to figure this out. And when we did that, we kind of looked at the baby steps and it was kind of like an audit. It was like, okay, what are we doing versus what the steps tell you to do? And what we found is there were a lot of inconsistencies. And the thousand dollar emergency fund was one of them. It was like, okay, you're supposed to have $1,000. We didn't have that. When you budget, you're supposed to have a cushion line item. We didn't have that because I was like, $0,00 based budget is $0 in the account. I felt that like, sure. And so these are the things that we do. Especially when you have a lot of debt, especially when you're trying to go quickly, you kind of think, that doesn't apply to me.

[Ken Coleman]

Yeah.

[Jade Warshaw]

And all you see it as money that you could be spending. But I'm telling you, Catherine, do the thousand dollars.

[Ken Coleman]

Very personal answer there, which is powerful.

[Jade Warshaw]

Yeah, yeah.

[Ken Coleman]

You felt her.

[Jade Warshaw]

I did. And I also understood the, the third part of this, which is if you've never. Some so many people struggle with saving, if you've never been a person who has had savings or you've never been able to make it stick. Right. You put it in and then you pull it out, it feels like you'll never be able to do it. But if you just take that money, you set it aside, you put a lock on it, you will find that it's a savings is a muscle that you build. And you're probably right now just, you don't have any muscles. And so you have to just work at it and you get stronger and stronger and that becomes something that you do become good at.

[Ken Coleman]

Love it. Really good question. Better answer. Love it. Let's go to Austin, who's now joining us in Salt Lake City. Austin, how can we help?

[Caller]

Hey, guys, how's it going?

[Ken Coleman]

Good. What's going on?

[Caller]

Had a question for you. My wife and I are currently on baby step two. We do have two cars that we have about, between the two of them, about 20,000 on one and just under 10,000 on the other. We're looking at downsizing. Right now just to help put more toward other debts and kind of get rid of those big payments. But I know on one of the cars we're probably about 3 to $4,000 upside down in it. And so I'm trying to figure out we do need two cars. With our kind of work and my kids school situations, we. We really do need two cars to survive. But I don't have the cash to like if we were to sell my wife's car, I don't have the cash to cover that, that upside down amount. About 3 to 4,000 to get the lien. So what's the best way to go about this? Yeah, I guess.

[Ken Coleman]

Well, quick question. That car, how much do you owe on that car?

[Caller]

So hers is, hers is between 19 and 20. I don't remember the exact amount. I think it's like 19 4.

[Ken Coleman]

Is it a good car?

[Caller]

It's a decent car. Yeah, it's a, it's a pretty nice SUV that we like. We have three kids so it fits all the kids and all the stuff that we need.

[Jade Warshaw]

And is that the one that's upside down?

[Caller]

Yeah, yeah, that's the one that's upside down.

[Ken Coleman]

What other debt do you have?

[Caller]

We do have about 60,000 in student loans as well. Other than that we don't have anything else. We're currently renting so we don't have a mortgage, no credit cards, nothing else.

[Jade Warshaw]

What's your income?

[Caller]

My main job salaried at 75 and then I have a couple side gigs that bring in about 5 to 10,000 a year.

[Jade Warshaw]

Okay. So every month what do you see like on a, on a normal month, what do you see on the pay?

[Caller]

On the paychecks, my direct deposits about 54. And then between my side gigs it really fluctuates month to month. But we've currently budgeted at that 50 400amount. Because my other side gigs are pretty like it's not consistent, it's kind of up and down and it ebbs and flows.

[Jade Warshaw]

So I mean, how quickly using, using the side gig quickly. If you really said I'm going to focus in on the side gig, how quickly could you save up 3k since you're only. Since your budget is based on the 5400, how quickly could you do that?

[Caller]

It'd be probably two to three months.

[Jade Warshaw]

Okay, and what is the side gig?

[Caller]

I'm an architectural drafter, so I work for a home builder. That's my full time gig, designing house plans. And then on the side I do it as well.

[Jade Warshaw]

Okay.

[Ken Coleman]

I jade, I Don't know where you're at, but I'm leaning towards, I think he should just pay this car off.

[Jade Warshaw]

I definitely think that you could pay it off. The only thing that's throwing me a loop is the $60,000 in student loans. If it was just the cars I'd be like, say less like pay them both off. The 60,000 student loans is what's bothering me. Can I dig a little deeper and ask you what's the payment situation? Are you on the save plan? There's a lot changing with student loans right now, so I just kind of want to know where your head's at on those.

[Caller]

Yeah, great question. So currently we are on that save plan but with the unsurity of like whether that's actually going to be approved or not. So all of and my wife's loans are currently in forbearance so we're at zero interest, zero payments right now. And so we haven't been paying on them for the last few months to put more toward our car loans and do that. So that's currently where we're at. But I'm also like, I don't want to just let those sit there without making payments on them. But we are starting with those smaller car debts as well. So you know, get rid of those.

[Jade Warshaw]

Yeah, the student loans, those feel like a major risk right now. Safe plan. A lot of people have been on that to kind of curtail a higher payment. But there's a lot of talk about that being rolled back and the payment amount being due going up. And so I would hate for that to catch you off guard. For that reason I could be interested in downsizing the lower car or the, the twenty thousand dollar car. What's the ten thousand dollar car? What type of vehicle is that?

[Caller]

It's a sedan. It's a Subaru Legacy that I drive and I do. So that's my commuter car. I commute about 35 minutes every day. I could sell that for pretty much what it's worth. I'm not upside down on that one at all, but I would need something so I don't necessarily have the cash to go buy another cheaper vehicle.

[Jade Warshaw]

Yeah, I wouldn't get rid of that.

[Caller]

That's another question.

[Jade Warshaw]

I would not get rid of that one. Here's where I'm at. I like that you're using your skill set to make money, like extra money on the side, but it feels like it's a slow go. I wonder if there's something else that you could do that you can make a Lot more money, a lot faster. Because I think that if you're going to hang on to this twenty thousand dollar car, you've got to have a number in your head that you're committed to. Like every month we are bringing in an extra X amount of dollars. So it's probably you and your wife sitting down. How many kids did you have again?

[Caller]

We have three.

[Jade Warshaw]

Three. And what are their ages?

[Caller]

Six, three and one.

[Jade Warshaw]

Okay. All right. I think it's you and your wife sitting down and saying, honey, what margin of time do you have? And looking at the other and saying, okay, well, what margin of time do you have? And then putting your heads together and say, this is the amount of money that we're agreeing on that we need to bring in extra every single month so it's steady. And if you can do that, then you can keep this, this car. But just know those student loans are waiting for you in the wings.

[Ken Coleman]

Yeah, that's right. But they can do this.

[Jade Warshaw]

Yeah.

[Ken Coleman]

I mean, this is doable. So you got options there. I like it. All right, good stuff. All right. Fun hour. It went fast. That means I think we were having fun, Jade.

[Jade Warshaw]

Yeah, we were.

[Ken Coleman]

I can. Okay, good. All right. That would have been awkward had you said no.

[Jade Warshaw]

Well, I'm just kidding.

[Ken Coleman]

I know. This is the Ramsay show. I hate to admit this, but I don't always eat right. I know I need to eat more fruits and veggies, but sometimes I just have to pound some chips because they taste so good. That's why I love my field of greens. It helps me eat healthy when I don't have much time. And each fruit and vegetable in field of greens was doctor selected for a specific health benefit. Heart, lungs, kidney, metabolism, even healthy weight. And folks, I ain't getting any younger. It's super easy to mix with water. And here is the great part of it. I thought it might taste like grass, but it tastes great. And only field of greens makes this promise. Your doctor will notice your improved health or your money back. So go to fieldofgreens.com Ramsey for 20% off your first order. That's fieldofgreens.com Ramsey to save 20% on your first order. This is the Ramsey Show. America, we're thrilled to have you with us. You're welcome. We want to coach you up to win with your money, to win with, win in your profession and win in your relationships. 888-255-2225 is the number. The chuckle you heard in the background was none other than my good friend and co host Jade Warshaw. She's going to try to keep me on track as well as give you great money advice. So pray for her.

[Jade Warshaw]

Well, you said you're welcome, you're welcome.

[Ken Coleman]

You thought it was like, like we're blessing them with our presence. And I was thinking you are welcome. Welcome.

[Jade Warshaw]

Got you. Like you are welcome here with us.

[Ken Coleman]

You are welcome here on the show. We want to help you.

[Jade Warshaw]

I hear you. Yes, Kim, I have to work better.

[Ken Coleman]

I think my personal brand is making you think one thing. No, I'm just happy to be here. Let's go to Margie in Chicago, Illinois. Margie, how can we help today?

[Caller]

Hi, thanks for taking my call. Just wanted opinion and see your thoughts on where we are today. So I'm 60 years old. I work full time still and I bring home, I'm a 1099 contract, but it is a renewing contract. It's just everybody's 1099. And my husband is 68 and he's retired and he brings home, I make 90,000 and my husband brings home about 6200. With Social Security and pension, I think we're on the right track. But he feels that we have enough money to. He's not a big spender. But it's the nickel and dime where we go out to dinner, some unnecessary purchases, small purchases.

[Jade Warshaw]

Is it in the budget?

[Caller]

You know, I did write in initially in an email and we don't have a budget so I know that's going to be do the $1 thing. But we do manage to get into savings every month. We both manage to make sure that there's enough for my income tax that I have to pay on because I'm 1099.

[Jade Warshaw]

How much do you bring in?

[Caller]

I bring in 90,000amonth, 575.

[Jade Warshaw]

Is that after the taxes or before?

[Caller]

Well, that's before. And then I divvy it up into the bank accounts taxes and then we are able to save for the top dollar roth that we put into annually.

[Jade Warshaw]

What's yours after the taxes come out?

[Caller]

Oh, she's after the taxes, it's probably like 4300 because that's income and property tax.

[Jade Warshaw]

Okay.

[Caller]

So we have virtually no debt. We have 9,000 left on our mortgage, no car payments, no credit cards. We have like 16,000 in our emergency and then like 50,000 in our high yield account.

[Jade Warshaw]

Okay.

[Caller]

So. And I just keep saying and we have 600,000 in retirement savings.

[Jade Warshaw]

Okay.

[Caller]

But I just keep saying we still can't just frivolously, you know, always go out. It's expensive to go out to dinner. And he thinks I'm so frugal. And I'm like, no, we still need to save for retirement because I do want to retire.

[Jade Warshaw]

Well, I think that, I think that the, the crux of all of this is without a budget, everything's a guess, right? It's like, I think that this is probably not good, or I think that we don't have enough, but you really don't know. Or you think that this is outside of our range, but you really don't know because there's no set limit. That's really telling you. So I think thing number one is if you guys get a budget and every dollar budget, it's going to take a lot of guesswork out of what you're saying because it sounds like you bring, you bring home $10,500 every month. That's a lot of money, especially for people who don't have debt. And so I think that if you guys do a budget and in the budget, of course, you're, you're adding the things that are very necessary, right. Your mortgage and your 15 that's going towards retirement and all of the other little things that you guys are paying for. And if you just say, okay, and our restaurant budget is, is 500amonth and are, you know, saving for vacations, we're putting away this much a month. I think that that's going to be eye opening for you. I really do. Because you guys clearly have done a fine job saving. You've done a fine job getting your emergency fund. You got 50,000 in the HYSA, which by the way, what's that 50,000 earmarked for?

[Caller]

Just for lack of another word anywhere else to put it. It's not earmarked for anything.

[Jade Warshaw]

It's just, it's just there extra money.

[Caller]

Yeah, the 16,000 in emergency is over abundance from what you guys talk about. But that's in case we want to do something for the house or we want to, I don't know, we don't even really touch it. We just, it grows and then we move it over to high yield. So.

[Jade Warshaw]

Okay.

[Caller]

And that's just because there we can't give any more to Roth.

[Jade Warshaw]

Yeah.

[Caller]

So we can only do the 16. So.

[Jade Warshaw]

So you've got a couple options. I love that you've got the emergency fund there. That's exactly what it's there for, the 50,000. Yeah, maybe that's there for fun things that you want to do if you want to take a trip, if you need to do Something for the house that's there for that. You know, if you feel like it's too much, you could invest some of it into a brokerage to where it's still gaining a better interest rate over time. You don't have to, but you could. What are you investing? What's the dollar amount that you're investing every month at this point?

[Caller]

I'm sorry, I'm confused by that.

[Jade Warshaw]

Did you tell me that you're still putting money into investments?

[Caller]

Oh, I, we just, I just do a one time drop in after the first of the year, up to like April. So I.

[Jade Warshaw]

Okay.

[Caller]

To our financial advisor, 16,000. Eight for him, my husband, and eight for me.

[Jade Warshaw]

Okay, 16,000 every year. Okay. Okay, got it. Okay, so. So you're doing that.

[Caller]

I mean, I could give it to her monthly. If I wanted to, I could give it to her monthly budget. Yeah.

[Jade Warshaw]

Okay, then I, you know, I think that, I mean, Ken, tell me if I'm wrong, but I think a budget is what's gonna unlock it.

[Ken Coleman]

I think so. I think at the heart of the question, though, Margie, from what I heard it was you're trying to get you and your husband on the same page. You're using frugality and you want a little bit more of a plan. You want to get ahead a little bit more. And he's going, man, I kind of want to enjoy life. We got enough. Is that the tension?

[Caller]

It is. And I keep saying every time he wants to go out or, you know, we have a couple kids with a grandchild and, you know, if we all go out to dinner, that's easily $200 in a week. You know, we're, you know.

[Ken Coleman]

Okay, so let me. So I think everything that Jade said is spot on. And I think that what she's saying is absolutely the key to you finally getting you and your husband on the same page with the budget. If you treat this budget for him as not this frugality play, but actually an intentionality play. In other words, he's just, he's kind of just. It's tension every time you try to say, hey, I'd like to be a lot tighter. All the things, I mean, Jay gave you the way to do it. But I think to get him on board, it's less of a message of being tight and frugal. Has a. I think it's got an emotion on it that he doesn't like. And I don't think it's going to break through. This is my hunch. But if you come at it and Say, hey, this is going to allow us to spend like you want to spend. But still, we make the progress in these areas over here. And I think by doing what Jade told you. So it's everything she said. All I'm saying is, the way you couch it, this isn't manipulative. It's just speaking to his desire to live. He wants to live. I hit the nerve. That's why you're laughing.

[Caller]

Well, yeah, because we're not. We take one vacation a year. We're not travelers, but we do enjoy a vacation.

[Jade Warshaw]

I think that you're a bet. I think you're doing better than you think you are. Because when I agree, when I plug your numbers and I go, okay, she's 60, he's 68, he's gonna bring in 6200 for, you know, forever. Until this point on, you can. If you continue that on for the next seven years, you're gonna have what you're doing right now with the investing that you're doing right now, you'll have one, almost $1.4 million, right? So if you just lived off the interest, which was140,000, I'm not accounting for inflation. That's far more than you're earning now. So you don't even have to live. You could live off of 70, 000 and be exactly where you are now. Now you are good, mama.

[Ken Coleman]

And you get him in the middle. The budgeting is for planning and intentionality, but give him some space. Give him his, you know, fund, whatever that is. You guys put it in the budget. That way he's got some margins and you guys are okay. Fun stuff. Really fun call. All right, we got to take a quick commercial break because Got to pay them bill.

[Caller]

Statistics show that half of Americans don't have enough life insurance or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're not going to die or something.

[Ken Coleman]

Well, I used to be one of those guys.

[Jade Warshaw]

I didn't even think about it.

[Ken Coleman]

And one of my buddies said, hey.

[Jade Warshaw]

The only reason to not have life.

[Caller]

Insurance is if you hate your wife and kids.

[Ken Coleman]

And I immediately went and got term life insurance.

[Caller]

That's a gut punch.

[Ken Coleman]

For decades, Dave, I've sat across people who've lost a spouse, they've lost somebody important to them.

[Jade Warshaw]

Me, too.

[Caller]

They don't know what to do next. You're gonna have a crisis here. You know, you got two options while you're Sitting and talking to a young widow. She's concerned about how she's gonna invest all this money properly and not mess this up. Or she's concerned how she's gonna eat tomorrow. That's exactly. These are the two options. It's saying I love you to your family. Term life insurance, Jeff Zander and the team at Zander insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800-356-4282. Hey, guys, good news. Presale is on now for my new book, build a business you love. If you're a business owner, you know running a business is hard. That's why I wrote this book, to share what we learned over the last 30 years so business owners can grow your business faster with fewer mistakes. Pre order your copy today and you'll get access to over $350 in bonus items only at ramseysolutions.com store ramseysolutions.com store pre order today.

[Ken Coleman]

Welcome back to the Ramsey Show. I'm Ken Coleman. Jade Warshaw is with me. We're here for you, America. Triple 882-55225. Let's go to Newark, New Jersey. Jeremy is there. Jeremy, how can we help?

[Caller]

Hey, how you guys doing?

[Ken Coleman]

Great. How are you, sir?

[Caller]

Better than my deserve.

[Ken Coleman]

Oh, I like that. I should use that.

[Caller]

Yeah, right. Okay. So basically, I'll try to make it quick. Right now I am working a job in construction. Last year I made about 150,000. But I have an opportunity, I guess you could say, in the same field, the same construction. But the thing is, I'll be making significantly less money, I guess, in the first couple years, but then it'll kind of even out, and then I'll at some point make more after I think, like four years. The new position would. Yeah, the new position would be a lot less labor intensive, a lot easier on the body.

[Ken Coleman]

Okay.

[Caller]

People that are in my role right now in my current company, maybe the guy who's been here the longest has been there for like 10 years. Maybe the people I talked to in the other position, I've been there for like 30, 40 years.

[Ken Coleman]

Okay. So. So it's gonna be easier on your body as a pro, looks like it has more longevity, is a pro. A 40% cut is not a pro.

[Caller]

And no.

[Ken Coleman]

And I, I'm a guy that has entertained things like this before, but four years. So the, to me, the question, and the only question that I need an answer to on this is, can you absorb that? Is it taking you to a different state or cost of living or. You've got so much margin in your life that 40% won't really be obvious in a painful way. That's what I need to know. What can you sustain that?

[Caller]

I would have to cut a lot of stuff, which I'm perfectly fine with doing myself.

[Ken Coleman]

Are you. Are you single?

[Caller]

I'm not single. Me and my girlfriend been dating for a few months now.

[Ken Coleman]

Well, you're single as far as I.

[Caller]

Take it, because she's used to.

[Ken Coleman]

Right. My point is, is you're not in a marriage situation where. And you don't have kids. Right.

[Caller]

Right.

[Jade Warshaw]

Do you have debt?

[Caller]

I'm sorry?

[Jade Warshaw]

Do you have debt?

[Caller]

All I have is a car loan that I actually got. Once I got this job, I got a little excited making the extra money. So before this job, I was making maybe like 40 to $50,000 a year.

[Jade Warshaw]

Okay, so this was a big jump for you. A major jump.

[Ken Coleman]

So. So what are you making now?

[Caller]

Well, my salary, I guess if I were to work 40 hours a week, would be around 120, I guess. Last year I did, you know, a little bit of overtime, So I made 150.

[Jade Warshaw]

Oh, okay.

[Ken Coleman]

Yeah, I just. I. I'm going to tell you that you need to be looking for other opportunities that don't require a 40% cut. I understand the physical toll on the body. I do get what you're saying there. I see the longevity play. If I were in your shoes before I did this, I would be making sure that there were no other better options. And I don't believe that that's the case. Jade, I just don't think that's the only option he has.

[Jade Warshaw]

I'm just trying to understand. So you got this gig that it's paying more than you were making, and you got excited, got the car, this other thing came along. Were you looking for something else? And if so, what was the main driver? Was it the physicality thing that you were like, I can't keep doing this to my body. I got to get out of this? Is that what happened? Or did that just happen to be, you know, part of this?

[Caller]

Well, and while working construction, I'm an operator. Right. But I'm not, like, running. I'm not. How do I say? I'm not running and, like an excavator or anything like that. I'm more operating like a. Like a truck.

[Jade Warshaw]

I'm just getting. What I'm trying to get at is for you to tell us why you want to leave this job. Because if you can't articulate a clear reason, then what's the point of leaving it?

[Ken Coleman]

Yeah, I don't feel like you're in an emergency situation is what she's getting at. Like, this feels like.

[Caller]

No, no, it's definitely not an emergency situation at all. It's more like, what can I see myself doing in the long run? It'll be part. Oh, so I should mention also, this is a union job. It'll be part of the same union, just a different kind of, like, sector, I guess you can say.

[Ken Coleman]

Well, I'm going to tell you right now, I am never going to tell somebody to take a 40% pay cut and sit four years in that pay cut to get to move up in a union. It's too risky. I'm not going to put my future in the hands of the union. Sorry. So I'm going to catch hate for that, but that's just what I believe.

[Caller]

It's okay. I get it. So it's not. It wouldn't be a 40 pay cut for four years. Like, the first year would be 40. The next year 30. Next year.

[Ken Coleman]

Oh, well, you buried the lead. You didn't tell us that.

[Caller]

Oh, sorry.

[Jade Warshaw]

Yeah.

[Caller]

Yeah.

[Jade Warshaw]

So it raises 10% every year.

[Caller]

Yeah, I go up 10 every year until I'm at the 100.

[Ken Coleman]

I personally would.

[Caller]

Okay, here's forever.

[Ken Coleman]

Here's my ruling. I'll let Jay get the last word on it because I. I've heard enough. I personally would not do this. However, from giving you advice. If you believe this is your best ladder for the future that you want and you can absorb the cut, 40%, one year, then it's only 30. Then if you can absorb that, not go into debt, and you got enough margin to live comfortably, then I. Then I wouldn't hate it, but I would not do it. That's. It. Sounds like I'm splitting the baby, but I'm not.

[Jade Warshaw]

No, I get it.

[Caller]

This is.

[Ken Coleman]

What do you say?

[Jade Warshaw]

I want to know what you owe on the car. I want to know what you owe on this car.

[Caller]

Oh, okay. So on my car I owe about 30. My plan was, if I were to do this, I would want to pay off my car before I even consider doing it.

[Jade Warshaw]

Okay, I'm fine with that.

[Ken Coleman]

You score brownie points right there with.

[Jade Warshaw]

Jade, you scored some points because. What's the payment on the car?

[Caller]

Actually, the payment on the car is about 700amonth.

[Jade Warshaw]

Exactly. And so that you're gonna feel that.

[Ken Coleman]

That'S 8, 400 a year, pal.

[Jade Warshaw]

Yeah, yeah, you're gonna feel that one if you take this other job. And so that would be my, my, you know, caveat to this is, yeah, pay that thing off and then would.

[Ken Coleman]

You do it personally?

[Jade Warshaw]

I'll be honest, I don't feel like you've made it very clear, Jeremy, what this job is really going to do for you. I'm not sure that. And I'm sure maybe you know it deep down inside, but you didn't make it really, really clear to us. So I'm still struggling with why it feels like something you need to do.

[Caller]

I feel like it's something that I could see myself doing longer than what I'm doing right now. Especially with like.

[Ken Coleman]

Yeah, but see, that's great.

[Caller]

Like I said, my.

[Ken Coleman]

Okay, I'm interrupting.

[Caller]

I'm sorry.

[Ken Coleman]

I'm interrupting because my partner figured it out. She got to the core. You're just looking at this as, this is good. This is good long term. We want great for you. What's going to make Jeremy get fired up on a Monday morning 20 years from now? I don't think this is it. Am I right?

[Caller]

Well, I'll be honest, this has been the only job I've ever had. Like the one I'm in right now where I'm actually excited to go to work. Work. And when I look at the other people doing their thing, I look at them like I wish I was in their position, my job so much, I still kind of wish I was.

[Ken Coleman]

Okay, that's all that we're getting at.

[Jade Warshaw]

Okay, now can you, can you.

[Ken Coleman]

I mean, that's what you were getting at. And kudos to you. That's what I teach and I believe it's like, is this the long term play? And a long term play that we go, I'm excited about this. Not, it's a good job. It's okay.

[Jade Warshaw]

Okay, so you do love your job. Okay, all right then.

[Ken Coleman]

Yeah.

[Caller]

Half of what it is now, I would still love it.

[Jade Warshaw]

If it's the difference between I love it or I love it more, then you go with you love it more.

[Ken Coleman]

Yeah. All right. Yeah, well, there you go. Get your house in order financially before you take this move. Because you don't want this. They don't want this to be. You don't think, okay, this is going to be fun. And then you get in and you go, oh, this is a lot harder than I thought. This is, I call it my half marathon decision. I thought, oh, this will be a great test. And It'll be fun training, and it'll be all these things.

[Jade Warshaw]

Yeah.

[Ken Coleman]

And it was. Your boy got. No, it wasn't. Your boy got into it and was like, I'm a grown man. Why am I out here running for two hours on a Sunday afternoon instead of laying on my couch watching golf. Yeah, but I didn't. It wasn't. It wasn't grit that was worth it to me. There wasn't anything.

[Jade Warshaw]

In other words, there was no payoff.

[Ken Coleman]

I thought I'd be motivated to do it, and I was motivated to get. Get through it. Big difference.

[Jade Warshaw]

Yeah, there is.

[Ken Coleman]

You know what I mean? Yeah. I'm not like you.

[Jade Warshaw]

You.

[Ken Coleman]

This woman, folks, she is an iron woman. I mean, you can just go run marathons, like, no big deal.

[Jade Warshaw]

Ran a marathon.

[Ken Coleman]

Yeah. But the way you just trained, you're just too. You're too. You're too disciplined for me on that. I'll play pickleball for three, four hours now.

[Jade Warshaw]

That.

[Ken Coleman]

And I'm not gonna go running on the road somewhere for no purpose at all. What am I doing? I'm just trying to run back to the place where my car is. Doesn't make any sense to me. But I digress. This is the Ramsey Show.

[Caller]

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 closing day. Find a Ramsey trusted agent near [e-mail] agent. That's ramseysolutions.com agent.

[Ken Coleman]

This is the Ramsey Show. I'm Ken Coleman. Jade Warshaw is with me, and we're here for you. 888-225-5225. So I gotta give it to you, Jay. We've got a fun email we got from Nate in Michigan. And this is fun. It's kind of related to a segment you've done before. Asking for a friend.

[Jade Warshaw]

Yeah, asking for a friend. It's whenever you want to know something that you feel you should know at this point in life.

[Ken Coleman]

Right?

[Jade Warshaw]

Right. You don't want to be today years old, where you find out about something that you feel like you should have known forever. And so instead of putting the heat on you and saying, hey, can you tell me about this? You put it on a friend.

[Caller]

Yeah.

[Jade Warshaw]

So. Yeah. Imaginary friend asking for a friend. Right. So Nate from Michigan is asking for a friend. We don't listen. His name is probably not even Nate.

[Ken Coleman]

Yeah, that's fine.

[Jade Warshaw]

He says, I just wanted to know the true meaning behind the phrase cash flow. Okay. Sometimes it seems like it means simply the. That we paid cash for something. Or for example, we cash flowed the building of our house. Right. At other times, it seems like it's a phrase that's being used in a business sense. Right. Is the business profitable? Just wondering what that means. Okay, so this is good. He's right. We do kind of use it in two different ways. Yes. 100. Cash flow. When we're talking about personal finance, it means being able to use the cash that's flowing in and out of your pocket to pay for things. Right. So if I said, oh, I bought a new car and I cash flowed, it. It means that I used money that was out of. Usually it's monthly cash flow and said, yeah, I have enough in my monthly money to cash flow this. I don't need to dip into savings. I didn't need to borrow any money, and I used the cash that I had on hand. But there is also a cash flow that we would say in business sense, and it's not much different. I would just say that in business sense, when we say cash flow, we're talking about the movement of money in and out of the business. Right. So we're talking about that flow of money. It could be things like inventory or supplies or operating expenses or product sales. It's money flowing in and out of the business. And again, all of those things are things that we're paying for with the cash from the business. So. And it's happening over a period of time. And so it's still this idea that whatever it is that we're paying for, we're using cash for it, whether in a month's notice or over time with cash. So hopefully that provides clarity. I mean, obviously the best way to take control of your cash flow is to have a budget it. And when you do that, you can see how much cash flow is at your disposal. So you could do that with every dollar if you don't already have it. It's a good, good thing to have.

[Ken Coleman]

And I gotta tell you, anytime you can cash flow something, it just feels better than pulling it out of savings. I know the savings is there and. But I despise.

[Jade Warshaw]

I just.

[Ken Coleman]

With a deep soul hatred.

[Jade Warshaw]

Yes.

[Ken Coleman]

Pulling money out of the big fund.

[Jade Warshaw]

I agree.

[Ken Coleman]

I don't like it. It's not try to cash flow everything.

[Jade Warshaw]

Yes. Yeah. Even something that is a legitimate emergency. I'm like, no.

[Ken Coleman]

Yeah. Oh, yeah.

[Jade Warshaw]

Never.

[Ken Coleman]

Yeah, yeah, I get it.

[Caller]

All right.

[Ken Coleman]

That's how I got a free roof, by the way. Yeah.

[Jade Warshaw]

Tell us more. Ken Coleman. Well, the short, Free roof.

[Ken Coleman]

Short answer is had to. Had to replace our roof. Not thrilled about it, but hit me.

[Jade Warshaw]

With the free part.

[Ken Coleman]

So I started thinking, I gotta get this situation. I don't want to pull out of that. So I was like. So the guy comes up once he wants to do the roof. I said, look, here's the deal. We're very connected in the neighborhood. You do a good job, I help you get business. How do you feel about that?

[Jade Warshaw]

Oh.

[Ken Coleman]

He says, tell me more. We talk. Then he says, all right, I'll tell you what. I can get it to a point where it's just your deductible. So I thought, okay, I like that. So he calls insurance up because insurance had previously denied us. He gets on the phone with them, makes the case. Insurance says, we'll cover it. Then it's a deductible. So I go back to him and I go, how about you guys eat my deductible? I get the free roof, and in turn, I promote your company in my neighborhood through some social and through some key people that I know.

[Jade Warshaw]

Yeah.

[Ken Coleman]

He says, I'll do it.

[Jade Warshaw]

Holy smokes.

[Ken Coleman]

And guess what? We've got him four different roofs. So I've. I just thought, I don't want to touch. Then I got aggressive, like. So I went from, I don't want.

[Jade Warshaw]

You come up with better ideas.

[Ken Coleman]

And I didn't want to have any cash come out. So I, like, took my shot. Well, the worst he could say is no.

[Jade Warshaw]

Yeah.

[Ken Coleman]

So guess what? He's now had four roofs that I'm aware of that came directly from us. Now he's in the neighborhood.

[Jade Warshaw]

So I'm just saying, next on the list is you start taking a cut.

[Ken Coleman]

Where there's a will, there's a way. Yes, sure. Where there's a will, there's a way.

[Jade Warshaw]

That's true.

[Ken Coleman]

That is true. That's the point of the. Forget the details of my story.

[Jade Warshaw]

You're exactly right.

[Ken Coleman]

I started trying to get creative with how I wouldn't have to touch my emergency fund because it came out from blue like it was a problem we didn't know about. So now I'm like, come on, man.

[Jade Warshaw]

Ken, good job.

[Ken Coleman]

Yeah.

[Jade Warshaw]

That's all I can say.

[Ken Coleman]

Fun stuff. Sean is on the line in Denver, Colorado. Sean how can we help? How are you guys doing? Well, sir, what's going on?

[Caller]

Good, good. So I, my question is, I, my wife and I, we had a couple issues with the bank and our mortgage and our mortgage rate is actually increasing o to a point that this is the second time it's increased and it's getting to a point that the monthly payments are getting a little steep. And so we do have about 35 grand in savings. Not sure if that's usable in this case, but not quite sure what to do next.

[Ken Coleman]

Is this an adjustable rate?

[Caller]

So it actually started out as a 30 year fixed. We were at 3.8% and the bank called us a couple days before closing and said, hey, we accidentally wrote up your loan documents for a stick built home and you guys have a manufactured home, so we're going to have to rewrite those. So they did and we had to sign again. And that was about a month's difference. So our rate went from 3.8 to 4 and a half. And then about a day before closing, they called and said, well, you know, our bank sells these mortgages and nobody wants to buy this one, so we're going to have to drop you guys again. But they had a third solution and my wife actually works for this particular bank and part of the employee benefits package is they help you get into a first home.

[Jade Warshaw]

Okay.

[Caller]

Which sounds good. And so what they did is they said, okay, we'll go ahead and we'll get you guys a mortgage. We'll keep you at the 4.5%.

[Jade Warshaw]

Okay.

[Caller]

And in two years, or, excuse me, in three years, you guys can go ahead and refinance with us. We'll keep your rate and we'll lock you in for 30 years. It'll be great.

[Jade Warshaw]

Okay.

[Caller]

And so it's the end of those three years now and should have read the loan documents a little closer. They, they aren't going to keep the rate. It's actually going up.

[Jade Warshaw]

Oh, man.

[Caller]

Percent oh, man.

[Jade Warshaw]

So it had to lock in at whatever the rate is. Like, is that the current rate?

[Caller]

Yes.

[Jade Warshaw]

Yeah.

[Caller]

Yes.

[Jade Warshaw]

Oh, man.

[Caller]

So, I mean, it's, we're still at the point that it's, it's, you know, affordable.

[Jade Warshaw]

Well, tell me, tell me numbers wise, what it's gone up. It went from what to what?

[Caller]

So we were paying 2500amonth and now it'll be 3, 500amonth.

[Jade Warshaw]

My guy. Wow. Okay.

[Caller]

Yeah, yeah.

[Ken Coleman]

How would the 35, would the 35,000 even help you? Because you're going to have to refi Theoretically. And can you.

[Caller]

Yeah. And so this, this is only good. What they did was they came back and said, hey, you know, we did make a mistake in the beginning for you guys. So what we'll do is we'll only raise you 1% this year and then 2% next year, and we'll extend your loan for two years.

[Ken Coleman]

That's like, it's like I said, I made the mistake, so I'm only going to penalize you on my mistake this much.

[Jade Warshaw]

But you're still gonna feel it. They're just spreading it. It's like. It's like spreading out punishment. You get one whooping today and then you get one.

[Ken Coleman]

Is there something with your house from now, Is there something with the type of house? Because it's a manufacturer manufactured house that, that's why nobody wants these loans?

[Caller]

I think so, yeah. Because, you know, there's only one buyer, this bank that buys manufactured home loans. And they ended up being, you know, they were full at the time. They couldn't take any more loans. So that's, that's what happened as well.

[Ken Coleman]

Do you have any equity in this house at all?

[Caller]

You know, it looked like it. When I look at the estimate online, it says it's gone up about 100,000 from when we purchased it three years ago.

[Ken Coleman]

If it was me. No, Jay, tell me if I'm being too aggressive here, but I'd get out of this house instead of keep messing with this.

[Jade Warshaw]

He's.

[Ken Coleman]

If it's true that he's only got one lender who will play ball with him, he's going to keep getting jacked around here.

[Jade Warshaw]

Well, I have a couple questions at the end of this three year term. Whether they do it all at once or over the three year. You get slapped a little bit each year. Is that the end and what. You know, so.

[Caller]

So we only have two more years and then we have to. That's it. The loans matured and we. We either need a revolution refinance with them or with somebody else.

[Ken Coleman]

I mean, preferably 25 seconds.

[Jade Warshaw]

Do you love the house?

[Caller]

Yes.

[Jade Warshaw]

Okay, your choices are you find a way to get a thousand dollars more in your income because you can't. If you don't do that, this is going to drain everything. So if you don't find a way for you and your wife to bring in $500 a piece every month that's sustainable, you can't keep this house because.

[Ken Coleman]

Sell it. Yeah, I'm all for selling it, man. And rent for a while. Get yourself a house that doesn't have these kind of limitations.

[Jade Warshaw]

Or maybe it's you paying off debt and freeing that up in monthly payments.

[Ken Coleman]

Yeah, I this is the Ramsey Show.

[Caller]

Before you put down a ton of money on a new purchase like a car or a home, you probably spend countless hours researching. You read reviews online, make a list of everything you're looking for and compare prices to get the one that's right for you. But it's also a good idea to put in the work searching for the right insurance cover coverage. We know it's not always easy to find someone who cares more about you than making a buck. But you shouldn't trust just anyone to protect your biggest assets. That's why we've done the work of finding trusted pros for you. Whether you're looking for home and auto insurance or any other type of coverage, Ramsey can help. Our Ramsey trusted providers have all been vetted and coached to serve you like we would. I'm so confident in their quality service and coverage because I use them myself and record recommend them to my team members. Find what you [e-mail] insurance today. That's ramseysolutions.com insurance.

[Ken Coleman]

This is the Ramsey Show. I'm Ken Coleman. Jade Warshaw is with me and we're thrilled to have you. 888-2552-258882-55225 we get called it feels like almost daily from people who are launching a side business. They want to make some more money, whether that to be pay for college, pay off debt, build up retirement, or it's just about living the dream and building a business. And running that business effectively over the long haul is very, very difficult. And that's why we're very excited that Dave's got a brand new book out called Build a business you love. He's unpacking what it took took to take this business from a card table to where it is now over $250 million business. So it is the baby steps for running a business. That's the way Dave describes it. You could pre order it now for 29.99 and you're gonna get over $350 in free bonus items just for purchasing it ahead of time. You get to preorder it and it comes to you when it releases. You can pre order [e-mail] that's ramseysolutions.com store or the link is in the show notes if you're on YouTube or podcast. All right, to the phones we go. Patricia is joining us now in Long Island, New York. Patricia, how can we help?

[Caller]

Hi, thank you. It's great to be talking to you. I actually just heard of Dave Ramsey like six or eight weeks ago. And I've been listening compulsively since then, and a lot of it has resonated with me.

[Ken Coleman]

Great.

[Caller]

My deal is I went through a devastating divorce about 18 years ago, left me financially stripped. I've worked hard since then, put the kids through college on my own. And what's killing me now is the Parent plus loans. I just paid off my car from having listened to Dave. So thank you for all that advice from your area. And I only have one other debt, which is 2,000. So these parent plus loans are about 87,000. And I am already not a spring chicken, so the retirement years are scaring me to death. So I'd like a little direction.

[Jade Warshaw]

Okay.

[Ken Coleman]

I'm curious about the kiddos that you helped out with these loans. What are they doing now?

[Caller]

Well, my daughter is now in a good spot, but she just began, so that's not enough. They have their part of their loans and I have my part.

[Ken Coleman]

Okay, so. So the 87 is your. Is your deal just yours?

[Caller]

Yeah.

[Ken Coleman]

Okay. All right. I'm sorry. I should have asked that right out of the gate. Sometimes I'm wondering if parents are paying everybody else's or just yours. So. Okay. All right, so you've got the 87. What's your income?

[Caller]

It's just under 70.

[Jade Warshaw]

Just under 70. Okay. And that's your. Is that your only debt at this point? You mentioned you paid off the car. Is this it?

[Ken Coleman]

That in a $2,000?

[Caller]

These parent plus loans and then another 2,000 loan.

[Jade Warshaw]

Another $2,000 loan. Okay. And that's just a personal loan?

[Caller]

Yeah.

[Jade Warshaw]

Okay. All right. And what do you have saved? Do you have anything saved?

[Caller]

Yes, I started a High Yield Savings account. From you all's advice, I have a couple of IRAs. One is an IRA, one is an IRA. I have checking and savings.

[Jade Warshaw]

What's in your IRA and what's in your HYSA?

[Caller]

The HYSA is five because I just started it. 5K, 2 IR. The two IRAs. I'm trying to look at all my papers here. Come out to about 40.

[Jade Warshaw]

40,000. Okay. And anything else? Any other money anywhere we should know about?

[Caller]

Well, checking is about 45. Saving is about 290.

[Jade Warshaw]

When you say 45, you mean 4, 540. Like tell me real 4545.

[Caller]

45,000.

[Jade Warshaw]

45,000 in checking?

[Caller]

Yeah.

[Jade Warshaw]

Okay.

[Caller]

Another savings account is 21,000.

[Jade Warshaw]

Okay, good.

[Caller]

And that's pretty much it.

[Jade Warshaw]

Okay, so the good news, what I'm really excited about, Patricia, is you've got money laying around, which we need. So if I'm, if I wrote everything down correctly, obviously the 40,000 that's in the IRAs, we can't touch that. But you've got 45,000 sitting here, plus another 21,000. So that's giving me 66,000 right there. Yeah, that's the majority of these bills knocked out. And technically, because you're in debt, I know you're not going to like this, but because you're in debt, that HYSA needs to go down to 1,000 and we can take the other 4,000. And now suddenly you've paid off $70,000 of debt in one day.

[Caller]

If we do get to say that.

[Jade Warshaw]

Yeah, but here's the thing. When you called in, you didn't say, my biggest problem is I'm scared to spend my savings. My biggest problem is I'm afraid that I won't be able to. You said, the biggest problem is these student loans. And you, you're right, those being around your neck is the biggest problem. So if you can knock those out, how old are you?

[Caller]

I'm 68.

[Jade Warshaw]

68. If you can knock those out and get them out of your, out of your hair, how much money a month does that free up in payments? Sense.

[Caller]

High seven hundreds.

[Jade Warshaw]

Yeah. High seven hundreds, yeah. Think how much you, you can, you can live off that. You can invest some of that. Like that really does clear things up for you. Now then, once we pay off this debt, now we have to look at, okay, like you said, long term, what's the retirement strategy? But a one is we've got to get out of this debt. Because if we've got this kind of debt, who cares what the retirement strategy is?

[Ken Coleman]

That's right. Right.

[Caller]

I know, I know. I've just been living in worry.

[Jade Warshaw]

Yeah. So I think that so long. I think paying these off is going to be your best bet and it's going to be painful, but then we have to turn around and say, okay, what's your living situation? Are you a buyer? Are you a renter? What's going on there?

[Caller]

I rent.

[Jade Warshaw]

You rent, okay. So your goals are to try to find stability in this situation. So right now the, the debt is causing instability. Probably being a renter is causing a level of instability. My guess is that when you retire, you'd probably want to buy something and have that as a fixed number on Your, you know, on your budget. So I think those are the big goals here. I think in your mind you have to go, okay, like I'm working, I'm working another six years or so and I'm piling away as much cash as I possibly can to try to make that happen. But first on the list is these student loans and you know, making sure that you and your kids are sticking to what you agreed to pay because are they sticking to their end of the bargain?

[Caller]

Yeah, as far as I know. We don't talk about it much, but.

[Jade Warshaw]

I think you do need to talk about it because what would be. Are both of their names on it or just yours?

[Caller]

Oh, no, these are just parents less loans for me. That's just my name.

[Jade Warshaw]

Okay. Because if they don't pay theirs, then it's still affecting you. Right. And at that point it's like, well, what was the point of you even paying your part if they're not paying their part? Right.

[Caller]

Well, there's a separate from mine.

[Jade Warshaw]

Oh, okay. I thought you were saying that they had agreed to pay part of the parent plus loans.

[Caller]

Oh, no, no, we, we split everything from the beginning. They have their loans and I have.

[Jade Warshaw]

Okay, I see. Well, in that case, yeah, full speed ahead on paying off this 87,000. Clearing your name on that, that it's going to free up so much more income in your month to month mental space. You're going to have a lot more peace. And then you can really clear, see clearly and go, okay, what to do with this 40, 000. The good news is it's tucked away, it's going to continue to grow. It's not a lot of growth, but with that, with possible Social Security, you've got, you've got your work cut out for you, but at least you're making steps forward. In a situation like this, there's always a measure of peace that can be acquired. So you're going from where you are now, you pay these loans off, you've got even more peace. You start figuring out long term what you want your living situation to be, you've got even more peace. And so we're just taking it one piece at a time.

[Ken Coleman]

Yeah. And there, and listen, Patricia, there will come a point where, and you got to think about selling stuff, making extra money and you go, okay, what is, what is, what can I do every month? Could I make a thousand dollars a month in additional money that would go towards the loan or is it 2000? You start to play with these numbers and at some point when you begin to deliver on this, you're going to see the momentum them, and you will be able to get rid of this. And which will give you a chance to retire with some dignity. So you're going to have to be intense. Yeah, but this is actually very doable. But a lot of intensity over a short amount of time will get you there.

[Caller]

Yeah, I've tried. You know, the side hustles, and you're doing it.

[Ken Coleman]

You paid your car off. How expensive was that car loan you told us about?

[Caller]

17K.

[Ken Coleman]

Come on.

[Jade Warshaw]

So you're doing it.

[Ken Coleman]

It's not like you don't have any track record here. So get your chin up, Patricia. All right.

[Caller]

No, I know I've done a few things right, and I've never been one who depended on credit cards a lot. I don't like them.

[Ken Coleman]

You're a good lady.

[Caller]

You're good. You've done a few things right along the way.

[Ken Coleman]

Hey, no shame in your game. I'm not kidding you. Shame will hold us back.

[Jade Warshaw]

Yeah, that's right.

[Ken Coleman]

Breaking through, stuff like this. So you're okay. No shame in this show at all for you. That's why we do this. This is the Ramsey.

[Jade Warshaw]

SAT.