No Matter Your Income, You Can Still Build Wealth

Summary

The Ramsey Show – Episode Summary

Episode Title: No Matter Your Income, You Can Still Build Wealth
Date: May 28, 2026
Host: Dave Ramsey
Co-Host: Jade Warshaw

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Episode Overview

This episode of The Ramsey Show is dedicated to the clear, often tough-love message that anyone—regardless of income or past financial mistakes—can build wealth and take back control of their financial life. Dave Ramsey and co-host Jade Warshaw field live calls from listeners grappling with everything from tricky family entanglements and car purchases gone wrong, to job changes, debt payoff strategies, and starting over after setbacks. The recurring theme is practical, sometimes blunt, advice rooted in common sense and the foundational "baby steps" of the Ramsey method. Listeners are encouraged to challenge conventional ("normal") financial wisdom, take ownership, and pursue freedom from debt and financial stress.

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Key Discussion Points & Insights

1. Getting Untangled from Messy Family Finances

[01:00] – [08:00]

• Caller’s Situation: A couple is trying to remove the husband’s name from mother-in-law’s assets after helping her with various purchases, resulting in unwanted legal and financial entanglements.
• Dave’s Take:
  • "So they did a whole stupid thing, which is put his name on everything. And that was really stupid.” (Dave, 02:56)
  • Advises step-by-step legal detangling; notes that removing a name from a mortgage requires refinancing and won’t happen unless there’s something in it for the mother-in-law.
  • Jade points out how difficult it will be: “The two houses is going to be the pain in the neck.” (07:45)
• Broad Advice: Seek good legal and estate planning advice before mixing finances with family.

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2. The $62,000 Dodge Challenger for a 19-Year-Old

[10:50] – [19:44]

• Caller’s Situation: Grandfather buys his 19-year-old grandson a $62,000 car at 21% interest, cosigns, and now the family is worried about both the financial burden and safety.
• Dave’s Take:
  • "Your father did an idiotic, stupid deal in an effort to be a blessing... but instead cursed him by putting him into a car with a ridiculously high interest rate." (Dave, 13:48)
  • Advises selling the car at a loss and avoiding “stupid games and stupid prizes.”
  • Financially "bozo" grandparents and well-meaning but reckless choices can have long-lasting negative effects.
• Jade’s Emphasis on family financial standards: “If you’ve set up a standard in your household... this is not how we’ve taught you to live yours.” (16:44)
• Memorable Moment: Dave references Proverbs 17:18 – "It’s stupid to co-sign a loan."

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3. To Pay Off the Mortgage Early or Invest Further?

[23:00] – [31:25]

• Caller’s Situation: Benjamin, a successful contractor, wonders if he should pay off his $200K mortgage (at 2.5%) or continue investing in more rental properties for "passive income."
• Dave’s Story: Shares his own rise and fall in real estate due to over-leveraging.
• Key Wisdom:
  • "More debt equals more risk." (Dave, 27:09)
  • Encourages viewing mortgage payoff as a step to reduce risk and as a foundation for greater business prosperity and peace of mind.
  • Rejects the myth of truly passive income in real estate.
• Jade: Happy wife, happy life—listen to your spouse’s concerns.

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4. The Myth of Passive Income in Real Estate

[33:13] – [38:20]

• Dave's Rant: Blasts the popular claim that real estate is "passive income."
  • "There’s nothing passive about it. If you want passive, put your money in a mutual fund." (Dave, 35:11)
  • Owning short-term rentals (Airbnb) is even more demanding: "You opened a hotel."
• Practical Reality: Real estate requires active management and readiness for disruption (legal, logistical, financial).

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5. Switching Careers and Navigating Job Decisions

[38:54] – [42:32]

• Caller’s Situation: Young electrician choosing between a stable job and the union, which offers more pay and retirement, but less stability and more time away from family.
• Advice: Dave suggests staying in current stable job, doubts the net gain after volatility and work-life tradeoffs.

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6. Recovering from Business Losses and Debt

[44:32] – [52:16]

• Caller’s Situation: Jeremiah left a family business after Covid, took a lower-paying job, and is stuck with a large HELOC and unsecured debt.
• Dave’s Direction:
  • Restart side hustles in the old line of work to speed debt payoff.
  • "You can’t afford the house you’re in with the income you have." (Dave, 47:28)
  • Conventional loans and HELOCs require careful, individualized restructuring.

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7. College Decisions While in Debt

[54:23] – [60:33]

• Caller’s Situation: 24-year-old debating whether to pause paying off debt to start college (online, $12K cost).
• Advice: Don’t take on loans. Cash-flow college after paying off current debt, increase income through better job/side hustles, and recognize own earning potential.
• Notable Tone: Dave and Jade are encouraging—celebrate call-in’s frugality and perseverance.

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8. Saving for Retirement on a Low Income

[60:42] – [63:03]

• Caller’s Situation: 24-year-old assistant pastor, low income, wants to save for retirement.
• Reality Check (Dave): Most pastors are bi-vocational; “you may need a bread route.” The present income is not destiny—look for additional work and expect future prosperity.

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9. When to Repair or Replace an Old Car

[66:00] – [74:09]

• Caller’s Situation: Older Toyota with $8,500 needed repairs; paid-off but not worth much.
• Dave and Jade’s Approach: Don’t invest more into a car than it’ll be worth after repairs. Pay cash for an upgraded but affordable used car and plan purposeful “car replacements” as creates financial room.

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10. When is it Time to Leave the Parents’ House?

[76:24] – [85:12]

• Caller’s Situation: Recent college grad, earning $88K, living at home to save for a massive CA house down payment.
• Advice: Don’t rush into a huge mortgage. Consider renting to establish independence, improve earning power, and rethink location.
• Memorable Moment: “As long as your mommy is in the house… you haven’t started your adulthood completely.” (Dave, 79:12)

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11. Pay Off Debt with Investments or Budget Changes?

[85:33] – [91:07]

• Caller’s Situation: Disagreement between spouses—sell $28K in single stocks to pay $16K debt or pay it off via budget/traditional payments.
• Dave’s Solution: Both are right—sell the stock, pay the debt, and fix the lifestyle to prevent recurrence.
• Investment Advice: Don’t hold large single stock positions; better to diversify (mutual funds, high-yield savings for emergencies).

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12. Saving for Taxes—Don’t Spend What Belongs to the IRS

[91:11] – [93:38]

• Caller’s Situation: Self-employed, unsure if she should use $9K saved for taxes to pay down $80K in debt.
• Rule: Tax set-asides are "already spent"; hyper-vigilant quarterly savings needed to avoid IRS nightmares.

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13. Identity Theft and What to Do if a Brokerage Fails You

[96:00] – [104:17]

• Caller’s Problem: 84-year-old’s account hacked, $45K stolen electronically, brokerage/bank not immediately making her whole.
• Dave’s Guidance:
  • "Make sure your remaining money is safe... and ask them to refund the stolen money." (Dave, 99:03)
  • Encourages using identity theft protection and not hesitating to seek help from advisors/attorneys.

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14. Pressuring Teens to Apply for Scholarships

[105:51] – [111:19]

• Parent’s Dilemma: Should I force my high-achieving teen to put effort into college scholarships?
• Dave’s Approach: Convince with math and "the why," not by nagging. Applying for scholarships is like a high-paid part-time job—effort is massively rewarded.

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15. Early Retirement Planning

[113:32] – [114:48]

• Caller’s Goal: Retire at 55, what should be invested outside of retirement accounts?
• Answer: For early retirement, build a non-retirement (taxable) brokerage investment to cover 55–59.5 years, but focus on getting debt-free and building wealth first.

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16. Leaving a High-Paying, Toxic Job for a New Career

[116:42] – [125:35]

• Caller’s Crisis: Making $250K in mortgage sales, but culture is toxic; considering a complete pivot to become an electrician at a huge pay cut.
• Dave and Jade’s Counsel:
  • "You have conflated the career field being horrible with the company being horrible."
  • Try the same line of work at a different company before making an extreme jump.
  • Don’t make big financial and life decisions purely as an escape.

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Notable Quotes & Memorable Moments

• "More debt equals more risk." (Dave, 27:09)
• "It’s stupid to co-sign a loan." (Dave, 19:07, quoting Proverbs 17:18)
• "If you want passive, put your money in a mutual fund." (Dave, 35:11)
• "As long as your mommy is in the house... you haven’t started your adulthood completely." (Dave, 79:12)
• “Don’t live normal when you can live like no one else.” (Dave, 75:41)

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Timestamps for Major Segments

• [01:00] – Family Asset Entanglements
• [10:50] – $62K Car for a 19-Year-Old
• [23:00] – Mortgage vs. Investing Debate
• [33:13] – Real Estate Is Not Passive Income
• [38:54] – Electrician: Union vs Private
• [44:32] – Business Loss Recovery
• [54:23] – Should I Go to College While in Debt?
• [60:42] – Saving for Retirement with Low Income
• [66:00] – Repair or Replace Old Car?
• [76:24] – Should I Move Out of My Parents' House?
• [85:33] – Sell Investments to Pay Debt?
• [91:11] – Tax Withholding for the Self-Employed
• [96:00] – Identity Theft Complications
• [105:51] – Parenting: College Scholarships
• [113:32] – Planning for Early Retirement
• [116:42] – Career Change: High-Paying but Toxic Job

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Episode Tone & Language

Dave and Jade blend blunt, unvarnished advice with humor and grace, often injecting anecdotes from personal experience. They resist sugar-coating, favoring honesty and forthrightness, but deliver with warmth and encouragement, particularly to young and struggling callers. Listeners are expected to take responsibility and act, but are cheered for each step toward positive change.

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Practical Takeaways

• Don’t mix family and finances without legal advice.
• Don’t buy cars you can’t afford—even (especially) for your children.
• Pay off debts before investing; avoid debt for supposed “passive” income.
• Analyze job and life tradeoffs beyond the paycheck.
• Apply clear logic and math to car, college, and investment decisions.
• Identity theft is a serious threat—protect and advocate for yourself.

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For more detailed discussion or callers' stories, refer to the timestamps above. This episode serves as a masterclass in practical financial wisdom—rooted not in perfection, but in perseverance and a willingness to learn.

Transcript

[Dave Ramsey]

This is an ad for BetterHelp. May is mental health awareness month. And when life feels overwhelming, therapy can help you slow down, think clearly and move forward. Visit betterhelp.comramsey to get 10% off. Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey network and the Fair Winds credit union studio, this is the Ramsey show. I'm Dave Ramsey. Jade Washall, number one best selling author Ramsey personality is my co host. Today Paula is in San Francisco. Hey, Paula, how are you? Hey, I'm good.

[Caller or Guest]

How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller or Guest]

So my mother in law and husband put his name on all her assets before we got married. Because my husband's father passed away recently, we have an issue where since my husband's name was on her car, she was sued for a car accident, which means that he was also sued. We're trying to dissolve those agreements with her, but we're getting some pushback. We can't get copies so we need some help getting some financial freedom from my mother in law.

[Dave Ramsey]

Wow. Okay. So you said there were agreements. What do you mean?

[Caller or Guest]

So they decided to put his name on all her assets. The cars, the houses, the insurance. He signed all the paperwork to be on the mortgage, on the title, the deeds, etc.

[Dave Ramsey]

You can't add yourself to a mortgage. Okay, so he did not do that, huh? Okay.

[Caller or Guest]

He helped her purchase a home and so he was part of that.

[Dave Ramsey]

Okay, then if it was part of the purchase, he could be on the mortgage with her. Okay.

[Caller or Guest]

Okay. Yeah.

[Dave Ramsey]

Okay.

[Caller or Guest]

And then they refinanced the original home and so he is on those documents.

[Jade Washall]

Oh boy.

[Dave Ramsey]

So he was obviously trying to help her, right?

[Caller or Guest]

Correct.

[Dave Ramsey]

And why did they think he needed his name on everything in order to help her?

[Caller or Guest]

She did not have a trust in place. So she was fearful that if something happened to her, the family wouldn't keep anything.

[Dave Ramsey]

The family wouldn't get anything.

[Caller or Guest]

It would go into probate, things like that.

[Jade Washall]

What's she worth?

[Dave Ramsey]

Of course it goes into probate. But that doesn't mean the family doesn't get anything. All you need is a will. You don't have to have a trust.

[Jade Washall]

What's her net worth?

[Caller or Guest]

Do you know your mom's net worth? I was not quite sure.

[Jade Washall]

Well, give us a ballpark.

[Dave Ramsey]

Is it she a multimillionaire?

[Caller or Guest]

No.

No, she is not.

[Dave Ramsey]

Okay.

[Caller or Guest]

She. She works for an insurance company.

[Dave Ramsey]

Okay.

[Caller or Guest]

All right.

[Dave Ramsey]

And so the Net result is, is that they. He was trying to do a really nice thing and she was trying to protect, but they did not get good advice. And so they did a whole stupid thing, which is put his name on everything. And that was really stupid. And that's. And now you got sued. When she had a car wreck, how

[Jade Washall]

much is she being sued for?

[Caller or Guest]

I believe about $50,000.

[Dave Ramsey]

Oh, my gosh. So she didn't have insurance.

[Jade Washall]

She didn't have adequate.

[Caller or Guest]

She does. It's going to go through insurance. But because my husband's name is on her vehicle, he is named in that lawsuit as well.

[Dave Ramsey]

Yeah, he has to be.

[Caller or Guest]

Yeah. Okay.

Yeah. And now that we're married, we eventually want to buy our own home. So our goal is to completely dissolve these agreements with her.

[Dave Ramsey]

Yeah. Okay.

[Jade Washall]

So the 50,000 insurance is going to pay eventually. You just don't like that his name is tied up in it.

[Caller or Guest]

Yeah.

[Dave Ramsey]

She wants the name off of everything.

[Jade Washall]

So you want to go through and take his name off of everything?

[Caller or Guest]

Yes, yes.

[Dave Ramsey]

It's going to be very difficult. We're very complicated, and you're going to need legal advice. Okay. So each item will be different. Okay. A bank accounts. Very simple. He can go to the bank and have his name removed. Very easy. Okay. A mortgage is impossible. He can't get his name off of it. So she has to refinance her home to get a new mortgage to get his name off of it. And you'll have to probably pay the cost of the refinance because you're the one requesting to do this very complicated. The car title. She can just sign. I mean, he can sign an affidavit and have his name taken off of the car title, but she'll have to sign all of it. Is she refusing to cooperate in this idea?

[Caller or Guest]

She's okay to remove his name off the car title, but she does not want to refinance her homes right now. So she won't remove him from the homes.

Yeah.

[Jade Washall]

That's fair enough. I can understand why.

[Dave Ramsey]

Yeah. Well, I mean, if you offer to pay for the. Pay for the refinance cost and the interest rate is the same or less, it would benefit her to refinance it.

[Caller or Guest]

Okay.

[Dave Ramsey]

But she doesn't want to refinance it because she won't have to pay for it.

[Caller or Guest]

Right.

[Dave Ramsey]

And.

[Jade Washall]

And I was going to say, what is. What is her current interest rate? Do you know?

[Caller or Guest]

I think it was around 3%.

[Dave Ramsey]

Yeah. She's not going to refinance. It's not going to work.

[Caller or Guest]

Right, right.

[Dave Ramsey]

Yeah.

[Jade Washall]

Wow, that's tough.

[Dave Ramsey]

All right. You know what I would do is just make a list of stuff that has his name on it and say, what is the solution with each of these things? There's not one simple. You can't sign one simple document. It does everything. You have to go to each situation and have his name removed where you can. And until it's beneficial for her to remove, you know, interest rate wise and so forth, she's not going to. You're not getting off that mortgage. Wow. And your husband and his mom are both willing to do all of this. They just don't know how. Is that what you're saying?

[Caller or Guest]

My mother in law would like to wait five years or so. Sometimes she goes back and forth if that's what she truly wants to do. But the hope is that in five years she will refinance so that we can go purchase our own home.

[Dave Ramsey]

Well, I mean, as far as the other property, other things go. She's willing to take his name off.

[Caller or Guest]

Yeah. Car title. Yes.

[Dave Ramsey]

Well, I mean there's a whole bunch of stuff. You mentioned car title, you mentioned insurance policies, you mentioned bank accounts, you mentioned.

[Caller or Guest]

Right, yeah. So since he is on both the homes, she says that she cannot remove him from the home insurance. We did remove ourselves. We're trying to remove ourselves from her car insurance currently.

[Dave Ramsey]

Well, that's true. I mean, you don't, you, if you're on the mortgage, you want to be on the home insurance in case it burns, you don't get stuck with the mortgage.

[Caller or Guest]

Right.

[Dave Ramsey]

So your husband does want to stay on that insurance. That's accurate. So, okay, so really what we did is that they did, they were trying to do a smart thing and they did it in a dumb way, both of them, in a way that no one would recommend if they'd gotten any estate planning advice at all. It would not have been hard to solve this. And so, but there's no bad malice here. She's not, I mean, she didn't set out to do harm to her son and he certainly didn't set out to do harm to his mom.

[Caller or Guest]

Right.

[Dave Ramsey]

So there's no, there shouldn't be any drama here. You just gotta clean. You just gotta go through and clean it up. Other than the fact that you got sued. But I mean, that's not her fault. Actually, it's your husband's fault. He signed up on a car that he shouldn't have.

[Jade Washall]

I mean, the two houses is going to be the pain in the neck.

[Caller or Guest]

Yeah.

[Dave Ramsey]

That's going to be the hard Thing is getting rid of that and you know, just watch interest rates and as interest rates come down or you know, the balance on the mortgage comes down, pay off the stinking mortgage.

[Jade Washall]

I got to believe she's close to,

[Dave Ramsey]

you know, I don't know, something like that. But if you can get the interest rate to where it's beneficial to her to refinance, then I would be willing to pay the refinance cost if it was me to get her get my name off of it. And that's. That happens a lot of times where there's a divorce and they didn't bother to get the name off the mortgage and then five years later the divorced husband or wife's got a name hang out over here, then they'll have to go as a negotiation pay to pay for the refinance, get their name off. Yeah. But yeah, this is a classic thing of what we call street law, which is a bunch of people sitting around a campfire with an opinion about what you should do on something that have absolutely no freaking idea what they're doing. And this guy signed up for a mess. Running a business is hard work. You're the CEO, the accountant and the sales team. You don't have time to moonlight as your own benefits department. That's where Health Trust Financial helps. In fact, health insurance is one of the biggest and most confusing line items in your budget. And most of you are overpaying because you're stuck figuring it out alone. You don't have time to figure out all the fine print about networks and deductibles. My friends at Health Trust Financial have been helping Ramsey listeners for over 20 years. Their focus is simplifying health insurance and serving people with empathy. No pressure, no games. They give you clear, unbiased advice that fits your life and your budget. Most of their clients save hundreds of dollars every month. That's real. You can put back in your business or into the baby steps. So stop wasting your time, your energy and your money. You run the business. Let Health Trust Financial handle finding the right health insurance. Go to healthtrustfinancial.com today. That's healthtrustfinancial.com. Dominic is in Raleigh, North Carolina. Hi Dominic, how are you?

[Caller or Guest]

Hello. I'm doing well. I hope you guys are.

[Dave Ramsey]

We are. What's up?

[Caller or Guest]

So my father. So first of all, I'm 38 years old, I've got a 19 year old son and my father and I haven't always had a great relationship but we, we've got a better one now and we agreed that he would help my son buy a car. We can afford to buy him the car, but he wanted to step in and help out his grandson. And we didn't really have an agreement set on how much the car would be. And he ended up buying him a Dodge Challenger, which It was about $62,000. My father's car.

[Dave Ramsey]

Do you have a 19 year old son with a 62,000 car?

[Caller or Guest]

Yeah.

[Jade Washall]

Is that more expensive than yours? Than your car?

[Caller or Guest]

It is, it is. I, I still drive my Prius from college, to be honest. Wow.

[Dave Ramsey]

What does your, what does your 19 year old son make? How much does he make? Does he work?

[Caller or Guest]

He actually does have his own income. He's still living with us, but he flips furniture on. Him and his sister flip furniture on Facebook Marketplace. So I'd say he makes between five and six thousand dollars a month.

[Dave Ramsey]

Profit?

[Caller or Guest]

Yes, profit.

[Dave Ramsey]

Wow.

[Caller or Guest]

That's after he's gone and, and purchased the furniture. Okay. And bought lacquers and bought finish and painted and bought new handles for everything.

[Jade Washall]

Okay, great. And so this bothers you? It's too much. You feel like it's too much car for a 19 year old. Right.

[Caller or Guest]

Well, let me also make this clear. When he turned 16, we bought him a Civic. And in October of last year, he totaled the Civic. And he had begun to go into the car space. He had done a lot of bolt on and he had just finally gotten under the hood and started to do work on his car, which is why I think he was so eager to get a more powerful car. But that also has my wife and I worried because, you know, he's just told a car which struggles to get up to 100.

[Jade Washall]

Did he total it being reckless or did he total it? And truly it was truly an accident.

[Caller or Guest]

We are not sure if you, if you, if you, if you trust them. A squirrel ran across the road. But

[Dave Ramsey]

because squirrels always total Civics. No.

[Caller or Guest]

Yeah.

[Dave Ramsey]

Okay. All right. Yeah. Squirrel. It's the ultimate.

[Caller or Guest]

Yeah.

[Dave Ramsey]

Yeah. Okay.

[Caller or Guest]

So I also want to make two things clear really quickly. So the interest on the car. So his, his grandfather put down the down payment, which I'm still not totally sure how much it was, but the interest is at 21%.

[Dave Ramsey]

Okay. So your father does not have good judgment on financial matters. That's being nice. Your father did an idiotic, stupid deal in an effort to be a Blessing to his 19 year old grandson, but instead cursed him by putting him into a car with a ridiculously high interest rate. And that is way too expensive for a guy that makes $4,000 a month living in his parents home flipping furniture. Okay, so your dad is out of the equation. He no longer gets a vote. Okay, whose name is the title in?

[Caller or Guest]

My, My father co signed for the car, but it's my, my son's car.

[Dave Ramsey]

Yeah. Okay. If I were to advise your 19 year old son it would be to sell the car as fast as he possibly can because he's probably going to lose some money on it depending on how much of a down payment there was. But I'm guessing there wasn't much of a down payment. Car is too expensive for anyone that makes. Makes, makes 5,000 bucks a month. You shouldn't be having a car that's equal to your annual income regardless of whether it's paid for or not. It's ridiculous. It's a fabulous vehicle, it's a fun muscle car, but that's irrelevant. Okay. And he's at 21% interest and you're worried about his safety? I'm not as worried about his safety. I'm not 100% sure to be worried about his safety. I'm 100% sure this deal sucks. It was really dumb. And if I were loving my 19 year old grandson, well, or my new friend that's 19 years old, I would say, my friend, sell this car as quickly as you can and limit the damage that it's going to do to your life. Your grandfather's sweet, but he's not smart. That's what I would tell your 19 year old as fast as he can get rid of it. Now he doesn't want a salad and he's got bozo over here that can't do math whispering in his ear that this is okay.

[Jade Washall]

Who's paying the payment, Bozo or your son?

[Caller or Guest]

My son is paying the payment and my grandfather agreed to help him and I, I, we, my wife and I together make enough to absorb the cost of the payment.

[Dave Ramsey]

No, no, there's no reason for it. I think that he bought a car he can't afford.

[Jade Washall]

Yeah. And you're the parent and he still lives at home. So you do get to say this is not going to work. You get to say that.

[Dave Ramsey]

Yeah. And it's not, it's not a, it's not a I'm mad at somebody thing. If I'm you, it's honey, I love you, this is bringing harm to you. And I really wouldn't even bring up the totaling. The car and safety thing, it's just way too expensive a car and way ridiculous interest rate. Yeah, it's just suicidal. It's financially stupid.

[Jade Washall]

And if you've set up a standard in your household that we don't borrow money and we don't go into debt for cars, I think that fuels that argument even more, which is I can't advise you to do. This is just not how we live our lives. And this is not how we've taught you to live yours.

[Dave Ramsey]

Yeah, and I'm sorry I didn't keep my hand in the deal and keep it from happening. I should have stepped between you before you got run over by a Dodge Challenger at 21%. But you're totaling your whole life now as a result of totaling your Civic. And this is just not. There's just nothing smart here.

[Jade Washall]

Oh, gosh.

[Dave Ramsey]

But this is a starry eyed guy. You know, I don't know what's going on with grandpa, but he ain't got any smarter as he got older. We can tell that.

[Caller or Guest]

I'm assuming the deposit wasn't enough to bring us back.

[Dave Ramsey]

Probably not. You're probably in the hall being underwater.

[Caller or Guest]

Yeah, so. So do we.

[Dave Ramsey]

Well, that's up.

[Caller or Guest]

That's up to you, my father and do.

[Dave Ramsey]

No, I don't think your father's gonna do.

[Jade Washall]

No, I think you have to. I think that's a stupid tax. You guys are gonna have to.

[Dave Ramsey]

Somebody's going to pay. Junior's going to have to pay it. But Junior dynamic money. Yeah. Yeah. I'm guessing you're going to lose a little money on it, but I don't know how much he's going to lose a little money. You're not really technically in the deal, so you're not technically responsible, but I am going to say you live under my roof. We're not playing stupid games and expect anything except stupid prizes. Yeah. This is ludicrous.

[Jade Washall]

Crazy.

[Dave Ramsey]

This is like look up crazy in the column and you'll see a picture

[Jade Washall]

of this car and, well, the car note's probably almost a thousand bucks a month.

[Dave Ramsey]

Yeah. At least.

[Jade Washall]

Wow.

[Dave Ramsey]

21% on 62 grand.

[Jade Washall]

Oh, yeah.

[Dave Ramsey]

Yeah. Hello. Or they financed it for 18 years. You know, it doesn't matter. We will make sure we prolong this pain as long as we possibly can. Yeah. So interesting thing that Proverbs 17:18 says:1 lacking in sense cosigns for another. The new contemporary English version, the CEV says it's stupid to co sign a loan. Yeah, that's what the Bible says. So anytime you're thinking you're being a blessing to someone by co signing the loan for them, you're not.

[Jade Washall]

No, there's not.

[Dave Ramsey]

You're being stupid.

[Jade Washall]

The whole reason you would need a cosigner is a bank looked at that person and said there's no way I would lend you the money. I don't think that you can pay it.

[Dave Ramsey]

Yeah, I mean bank looks at a 19 year old who flips furniture and lives in his mother's basement and says I don't think this is a worthy credit. So we're not going to do it. And if you're dumb enough to co sign for it, we're still going to charge you 21% because we're going to call this a high risk subprime loan and we're going to gig you, we're going to screw you. So car dealer, we're going to screw the 19 year old and bank, we're going to screw the 19 year old and grandpa says I'll help.

[Jade Washall]

Wow. Thinking he's being a blessing.

[Caller or Guest]

Sam. This show is sponsored by Better Help. May is mental health awareness month and according to the National Institute of Mental Health, more than one in five US adults experience mental illness every year. Nearly half of those folks never get any kind of help. And these aren't just statistics. These are real people who are hurting and struggling. They may be you and we're living in this non stop noise, the screen comparison, constant notifications. It's our whole world and our bodies are always on high alert. We're communicating more than ever and people are communicating with us, but we're super disconnected. We're more anxious, we're more lonely, we're overwhelmed and we just don't know where to go. And that stress shows up in our relationships, in our sleep, in our health, in the middle of our chest. We were never meant to carry all of this stuff in our life. Alone and talking to someone can help. And that's where better help comes in. Betterhelp is an online therapy platform that matches you with a licensed therapist based on your goals and preferences. Their therapists are fully licensed in the United States and they follow a strict code of conduct. You can message your therapist and schedule sessions right in the platform and if it's not the right fit, you can switch anytime at no additional cost. Cut through all the noise. Don't do this alone. Go to betterhelp.com Ramsey to get 10% off your first month. That's BetterHelp. H E-L-P.com Ramsey.

[Dave Ramsey]

Buying or selling a home is a big deal. You want a high protein, high octane professional real estate agent helping you with that transaction. Not Somebody who got their license three weeks ago and is your friend from church. No, we want a pro. Somebody does hundreds of transactions and knows what the flip they're doing. Ramsey Trusted program is the only way to find the top agents you can trust to help make your home a blessing. It's a free service. Ramsey Trusted. So if you want to find a local Ramsey Trusted real estate pro, which has been vetted for production and quality, you can find that for free@ramsey solutions.com agent or click the link in the description. There you go. Benjamin is with us in Bowling Green, Kentucky. Hi, Benjamin. How are you?

[Caller or Guest]

Hey. Doing wonderful, Dave. Thanks for taking my call this afternoon.

[Dave Ramsey]

Certainly, sir. How can we help?

[Caller or Guest]

Well, me and my wife are having just a mild financial disagreement, and we're trying to put the puzzles together to see where we should invest money or what we should do with it.

[Dave Ramsey]

Cool. How long y' all been married?

[Caller or Guest]

We have been married for 10 years.

[Dave Ramsey]

Awesome. How old are y'?

[Caller or Guest]

All? 38 and 37.

[Dave Ramsey]

Cool. Very cool. So tell me about the disagreement.

[Caller or Guest]

Well, right now I own a construction company, and we've been successful. We've paid off all our debt besides our mortgage. And I really haven't tried to attack my mortgage just because I am locked in at a 2.5% interest rate. And rather than paying it off, I'm investing money in rental properties, trying to make a passive income. I've invested in silver and just a few other things to where, you know, when time comes to retire, I've got a passive income coming in that's taking care of me and not too concerned about the 2.5% interest rate being. I don't think we'll ever see it again. We're at the point now to where I could pay the house off.

[Dave Ramsey]

Oh, you have the money?

[Caller or Guest]

Same point. I could. We do. We have the money.

[Dave Ramsey]

How much? How much is the balance?

[Caller or Guest]

The balance is about 200,000 currently.

[Dave Ramsey]

Well, you are doing great, Benjamin. Congratulations.

[Caller or Guest]

Thank you. I appreciate it. Okay. And that. That's our decision. She believes that we should go ahead and pay that off. And you know me personally. I believe we can purchase some more properties.

[Jade Washall]

Why does she believe you should pay it off? What's her reasoning behind that?

[Caller or Guest]

Just stress more just knowing that we don't know on anything. You know, there's nothing tying us down. And my mindset is that we could invest in more properties. I could have my guys go in and fix it up. We could rent it out, and the rent could pay for our mortgage, and then we've got More assets, you know, in time.

[Dave Ramsey]

How long ago were you broke before and you didn't have 200 and you had debt still five years, I would

[Caller or Guest]

say within the last five years. Yeah, we've really turned things around.

[Dave Ramsey]

Yeah. And your construction business has blossomed during that five years too, correct?

[Caller or Guest]

It has. We've been truly blessed. Yeah.

[Dave Ramsey]

Because it's been the time it should have, in that five years have been excellent for your business versus not excellent for construction, which has been some other times in our past. Right. But right now it's making hay while the sun shines. So very cool. Okay, well, you called us and I'm guessing you probably already knew what we were going to say.

[Caller or Guest]

Well, my wife knew what you were going to say.

[Dave Ramsey]

Oh, you've been set up, Benjamin. You've been set up. Okay, well, let me give you a little background as to why she set you up then. And be nice to you. Okay. So When I was 23, my mom and dad were in the real estate and construction business and I got my real estate license when I was 18 and I love real estate investing. And when I was 23, I started buying everything in sight and anything that I could make a return on. And I have a degree in real estate and finance from the University of Tennessee. And so I was all in on this stuff. I'm 65 now, by the way. But I was 23. And so by the time I was 26, I had $4 million worth of real estate with a million dollar net worth and it was cash flowing like crazy. I mean, I made good money on it, but I had a lot of it on short term notes because I was flipping before there was cable TV or before there was Chip and Joanna, they weren't even born. And so, you know, this is where we were. Right. And so I became a millionaire by the time I was 26 years old, doing the kind of thing you're talking about. But I did it super poorly, a little differently than you're describing. But I'm telling you this story for a reason. Then the bank got sold and they called our 90 day notes that we had outstanding and that began a crash that took two and a half years for us to lose everything we owned. And we were sued and foreclosed on and bankrupt by the time I was 28 with a brand new baby and a toddler 10 years younger than you are now. And in that process I started learning what grandma with common sense says about money and what the Bible says about money. And both of those say, don't Borrow money. But I, with my finance degree was looking at it through the lens. You're looking at it at the math and saying, well, I got a 2 1/2% mortgage, why would I ever get rid of that? I'm trying to create this stream of rental income. But what I left out in my analysis, and therefore what you're also leaving out in your analysis is risk. Your 100% of the time that you have debt, there is risk. More debt equals more risk. And so a way to emotionally feel that right now in this discussion is to say, hey Benjamin, what if your house was paid for and you had the opportunity and you didn't have $200,000 in the bank and you had the opportunity to go borrow 200,000 against your paid for home at 2.5%, would you go do that? And you might, because you've kind of figured out two and a half you think is a great rate and it is a great rate, but you also, if you look at it that way, you might also go kind of gulp like your stomach kind of. When I say that I'm going to go borrow against my paid for home, there's something in your stomach kind of moves around. You see what I'm saying?

[Caller or Guest]

No, I see exactly what you're saying.

[Dave Ramsey]

It's a physical reaction to risk. And all that I did there was what's called a sunk cost analysis. And that is to reverse the discussion and see if it feels any different. And if you reverse the discussion, you say paid for house, I'm going to go borrow. It's the same thing as I'm not going to pay it off so that I can go buy rentals instead of borrowing on my paid for home to go buy rentals.

[Jade Washall]

I'm keeping the borrowed money.

[Dave Ramsey]

I'm not pay it off to go buy paid for rentals. It's the exact same mathematical equation, but thinking about it through a different lens makes your stomach go up in your throat instead of your brain going, oh, I've got two and a half percent, I'm making money on that. So all of that to say you called the show where we're always going to tell you to pay off your mortgage. Your wife set you up okay 100% of the time. And I own several hundred million dollars in real estate that is paid for today. I recovered, way vastly recovered from my old bankrupt days. And you know, and I love real estate. So I want you to own some rental property and I think you're in a great business with the adjoining business with construction but let me tell you what will happen to complete my sales pitch on this, okay? When you have zero debt of any kind, your construction business will flourish even more. And here's why. There's nothing gnawing anywhere at the back of your skull saying I gotta take this questionable job because I gotta have cash flow. Instead you look at a questionable job and go, that juice ain't worth the squeeze. I'm going over and you're gonna turn down crazy customers. You're going to turn down situations where you're going to go out over your skis and you're pushing too hard. Instead you're going to. And I've experienced this in my business. I make different decisions in the day to day operation of Ramsey Solutions because I don't have debt than if I had to do deals to make payments. And it's increased my prosperity. Those two things don't seem to be directly connected, but they are yet connected. Oh, here's another one. Physically, people have less physical ailments when they're not carrying any debt. It changes the composture or the composite of your body because your anxiety level is way down. So I'm gonna sell you as hard as I can to follow your wife's leading there. Agreed?

[Jade Washall]

Agreed. Happy wife, happy, happy life.

[Caller or Guest]

Foreign

[Dave Ramsey]

George Camel here. Let me give you three signs. It's time to stop hoping your debt problem goes away and actually take action to fix it. If you've defaulted on a debt, if collectors are calling non stop or if you're facing a lawsuit or think one's coming, you don't just have a debt problem anymore. You've got a legal problem. And that's why I tell people about Guardian Litigation Group. Because here's the thing. If you're behind on your bills, doing more of the same is not going to fix it. You need a different plan. And Guardian Litigation isn't just another debt relief company making promises they can't keep. They're an actual law firm. And from day one you get an attorney who represents you. So when collectors start pushing, you're not guessing. You've got someone in your corner who knows how to respond when your debt problems escalate into legal problems. So don't wait for it to get worse. Go to guardianlit.com Ramsey right away. That's guardianlit.com Ramsey Attorney Advertising Results may

[Jade Washall]

vary and no specific outcome is guaranteed.

[Dave Ramsey]

Jade, I feel like I'm supposed to recap one other thing and that is that real estate, if you, if you come on this show or if I'm having an interaction with you anywhere and you tell me you want to invest in real estate as past create passive income. What I'm going to realize immediately is that you don't know what the flip

[Jade Washall]

you're doing because you said passive.

[Dave Ramsey]

Because you act like real estate creates passive income. So if you've ever been a landlord, you know that it's. There's nothing passive about it. If you've ever owned rental property, there's zero passivity involved. So when people say real estate creates passive income, what that tells me is they've been getting financial advice from some moron on TikTok. That's what that tells me. Not that they've actually been in the real estate business. Okay? I've owned rental real estate longer than most of you calling have been alive. And that means I'm old, but it also means I'm experienced. And you know what you get from experience?

[Jade Washall]

Wisdom.

[Dave Ramsey]

Scars.

[Jade Washall]

Okay, I'll go with scars.

[Dave Ramsey]

I'll go with scars from doing stupid stuff. And so I've seen it all and done it all, I think with landlording, whether it's commercial properties that are retail with a pizza place or a CrossFit gym, or whether it's a condominium and the guy decides he's going to use his wife as a punching bag and he gets put in jail and she has two little kids and now they can't pay their rent. And I'm the landlord now what am I supposed to do with her? Yeah, so this. You want to call that passive? That makes you dumb or at a minimum, inexperienced. Okay, so you don't know what passive means? Passive means you don't have to do any you want passive. Put your money in a mutual fund and they will just send you an email.

[Jade Washall]

Great, great.

[Dave Ramsey]

And tell you what happened. You don't have to do anything that's passive. And so there's nothing passive about real estate, period. I even own a piece of ground that has nothing on it and it still work. And the tree fell across the neighbor's fence the other day and he called me and said, your tree's blocking my driveway. It's not even passive. A freaking blank piece of ground is not even passive.

[Jade Washall]

Shouldn't have had that tree on it, Dave.

[Dave Ramsey]

So, I mean, it's like. And he was right. So we sent a guy over with a chainsaw and got the guy's driveway back. Right? But oh my God, this idea that there's, you know, but so it. Don't listen to someone who says real estate is Passive. This is someone that's selling you crap or don't know what they're doing.

[Jade Washall]

Yeah.

[Dave Ramsey]

Okay.

[Jade Washall]

It's another way to have an income stream.

[Dave Ramsey]

It is an income stream. It is an alternative income stream and I love it. I've actually more. A higher percentage of my net worth is in real estate paid for no mortgages than is in mutual funds.

[Jade Washall]

Yeah.

[Dave Ramsey]

Okay. But I'm adept at and careful with and understand and have a management company that manages our real estate, you know, and so. But it's not passive.

[Jade Washall]

What's your. What's your opinion on Airbnbs and things like that that aren't just addressing.

[Dave Ramsey]

That's not even rental property. You opened a hotel. You got in the hotel business.

[Jade Washall]

Hotel business.

[Dave Ramsey]

If you don't believe me, figure out how many maids you have to hire. Change them sheets every day when those people leave.

[Caller or Guest]

Yeah.

[Dave Ramsey]

And all the stuff that you don't even want to talk about that you have to clean up, that was left behind at the bachelorette party.

[Caller or Guest]

Hello.

[Dave Ramsey]

In condo. Yeah. And they thought that, you know, what happens in Nashville stays in Nashville. Nuh. You left some of it in Nashville, but it didn't stay in Nashville, so we still had to clean it up after you left. And apparently you don't drink that much, girl, because you left some of that yet. No. This is bad. So this is what Airbnb is gross. It's gross.

[Jade Washall]

As difficult as it's gonna get if

[Dave Ramsey]

you might as well buy you a little hotel six and go, I'm in the hotel business. At least then you're admitting it instead of like, I'm maximizing a piece of rental real estate by making it Airbnb. No, you're not. You're running a hotel. That's all you're doing. It's a short stay hotel. A hostel at best. Right. I mean, that's. That's so. Yeah. And be ready for disruption. Like 16 states have already passed laws limiting and a lot of cities. New York City's coming down on it hard. Is shutting down the ability to operate a privately operated, UN certified hotel called an Airbnb. They're shutting them down. And so VRBOs and Airbnbs.

[Jade Washall]

Do you think they're short lived?

[Dave Ramsey]

Well, I mean, no, I don't. I think they're gonna be there. It's. But you know, it's not gonna be the answer to everything. And you know, for you to count on that stream of income and then your municipality go, oh, we changed our mind. Yeah, you're out of business. But you Pay too much for the house because you Airbnb it in your proforma.

[Caller or Guest]

Yeah.

[Dave Ramsey]

And you got screwed because you thought, oh, this is gonna work. Famous last words. Right. So, you know, again, if you want to run a hotel, you can make a lot of money in Airbnb. But don't act like, don't get it twisted. This is the other end of the spectrum from passive. This is like lots of work and gross stuff. Yeah. It's just. Yeah. I don't even know. There's that. Yeah. All right. And then Caitlin is in Salt Lake City. Hi, Caitlin, how are you?

[Caller or Guest]

Hi, Dave and Jade. How are you guys?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller or Guest]

So, a little background story. My husband and I are both 24 and we just welcomed our first baby a couple months ago. So we were kind of in stork mode, but now we're in that mode. Well, thank you. We're on baby step number two. My husband's an electrician, but we're trying to decide if he stays at his current job, which is a private owned company. It's a little bit more stable, offers a better work life balance. Or he can move to the electrical union, which would mean significantly higher pay and stronger retirement benefits, but potentially less stability during slow periods and layoffs and then more time away from home and overtime. So we're trying to decide the more stable path or getting ahead financially.

[Dave Ramsey]

Well, I think the net net on the union with him not having steady might not be as much of a raise as it sounds like it is.

[Caller or Guest]

Yeah, exactly. And that's what we're trying, kind of trying to decide.

[Dave Ramsey]

I don't think the net net is going to be much.

[Caller or Guest]

Right. So in Utah, there's a bunch of data centers coming in right now. And so they're offering a lot of incentive pay, like 10 to $15 incentive pay when working on those jobs. But the data centers aren't going to be forever. So we're just kind of trying.

[Dave Ramsey]

Is it possible to work some of that data center stuff as a side hustle?

[Caller or Guest]

He could. He has to only be working at the union, but he could potentially go back to this private company once these data centers are.

[Dave Ramsey]

So you can't, you can't be working private and union have to be Utah. It's not a right to work.

[Jade Washall]

Interesting.

[Caller or Guest]

At least that's what we think. We kind of just been looking into it. He's currently making 38 at his current job and then he would be making 43 with. Not with including incentive pay.

[Dave Ramsey]

I would stay where you are. Okay, that's not enough. I think by the time you adjust for volatility, you're not going to make a net $5.

[Jade Washall]

I agree.

[Caller or Guest]

Okay. Even with a pension. Like we shouldn't jump with for a pension.

[Dave Ramsey]

I don't jump for pensions.

[Caller or Guest]

Okay. No, we trust you, so we will do it.

[Dave Ramsey]

I'm going to stay where you are, but I am going to explore. There's a lot of work that needs to be done in the area is what you're telling me. And he has the skill to do the work. And I'm going to explore what I'm allowed to do as side hustles legally. And I'm not going to lie to somebody. If the union requires you to be union, then I just can't do it at the union sites. But there's all kinds of side hustles. So let me give you an example, okay? If the side hustle market is being sucked up by the unions, if the electricians that used to do side hustles other ways are now doing data center work with the unions, that means all the jobs they used to do are available. You see what I'm saying?

[Jade Washall]

That's a good way to look at it.

[Dave Ramsey]

Or just straight up get on with the data center thing as a side gig, working weekends just for a short, you know, for six months and pile on. And let's get the debt cleaned up right quick. How much debt you got Left?

[Caller or Guest]

We have 86,000 in my student loans and I currently work full time too. So we're in stork mode. And now we're just kind of going to throw all of our savings that we have.

[Dave Ramsey]

You're out of stork mode because you're home from the having the baby, right?

[Caller or Guest]

Oh, yeah, we are. We are already starting.

[Dave Ramsey]

So that's all. That's all in the rearview mirror. That's awesome. Congratulations on the baby. So what do you make?

[Caller or Guest]

Thanks. I make 90, 000 a year.

[Dave Ramsey]

And he does too, right?

[Caller or Guest]

Yeah. About 80.

[Dave Ramsey]

Yeah. You're gonna be out of debt. No time. I would not make this adjustment. You're gonna lose too much. Quality of life. The juice and worth of the squeeze. I'm using that a lot today.

[Jade Washall]

I like it. Gotta be worth it.

[Dave Ramsey]

Listen, identity theft doesn't just happen just because you're careless. You can do everything right and still become a victim. Whether your information is skimmed online, stolen through a scam, or exposed in a data breach, which happens every day, then it becomes your problem. Your time, your money, your paperwork galore. That's why I've told people for years to have identity theft protection. And the only plan I've ever recommended is from Zander Insurance. Zander monitors for signs of fraud, even home title fraud, and they send alerts when something looks off. Most important, if something happens and you're not stuck spending hours on hold filing forms and arguing with companies trying to fix it, Zander's dedicated restoration team steps in and does the hard work to help restore your identity. You can even protect your kids for free on their family plan. Go to Zander.com or call 800-356-4282 to protect yourself today. Identity theft is everywhere. Zander is how you fight back. Zander.com. Welcome back to the Ramsey show and the Fairwinds Credit Union Studio. Jade Washall, Ramsey personality, is my co host. The phone Number here is 888-825-5225. Jeremiah is in Knoxville, Tennessee. Hi, Jeremiah, how are you?

[Caller or Guest]

Hey, Dave. Doing good. How are you all doing today?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller or Guest]

Yes, sir. Well, I just have a couple questions here, a little background story. First. I was the owner and operator of a family business of 12. The business was over 12 years old, but I ran it for 12 years. And after Covid, it just got really hard for me to get any work. So I had to take a different avenue for employment, which at the time I didn't have very wise counsel or any counsel at that. And I did a lot of probably not so popular avenues to help with bills and different situations like that. So my overall question would be I'm working on the baby steps and obviously I would be at number two, maybe step number two on getting rid of all the debt. What is the best scenario or I guess to kind of expedite that? So to say I've got some unsecured debt and I have a heloc, that's kind of a gray cloud over my head right now that I'd really like to get taken care of before that draw period closes.

[Jade Washall]

How much is the HELOC?

[Caller or Guest]

The HELOC is 94,000.

[Jade Washall]

Did you roll all the debt into that or is there more?

[Caller or Guest]

I did. I have, I do have some unsecured debt outside of that, about 13,000.

[Dave Ramsey]

Okay. What's your first mortgage amount?

[Caller or Guest]

My first mortgage is $1500. No, no, the balance, all the balance were $260,000.

[Dave Ramsey]

What's the house for worth?

[Caller or Guest]

The house is worth around 850.

[Dave Ramsey]

Okay, that's good. And what's your household income?

[Caller or Guest]

The household income annually is 75k and I'm the breadwinner. My wife is stay at home homeschool mom. We just had our third child last year, so we got.

[Dave Ramsey]

What did you used to make in the family business?

[Caller or Guest]

I used to make average take home gross pay was anywhere from 120 to 160.

[Dave Ramsey]

Doing what? What kind of business was that?

[Caller or Guest]

I owned a caulking and waterproofing business. So pretty much anything that you can't see on a normal building, I was the one behind the scenes doing it and. But it paid good money when the work was there. It just seemed like the right thing to do at the time because we were thinking fast and needed to take something with a more secure pay. But I obviously knew when I took the job that it was going to be lower income. So I've tried to be patient where I'm at and work the ladder.

[Dave Ramsey]

You can't afford the house you're in with the income you have is your problem.

[Jade Washall]

What is your, what's your mortgage every month?

[Caller or Guest]

My mortgage every month is fifteen hundred dollars a month which is pretty good considering what the housing market is now with a 3.35% interest rate. And we're on year 10 of that. Yeah.

[Dave Ramsey]

And the 94, what's that? What's the terms on the HELOC?

[Caller or Guest]

The HELOC is a 10 year draw period and we're on like year four. I believe the interest on it is around 6% probably a little bit.

[Dave Ramsey]

Who's your bank?

[Caller or Guest]

My local bank that I deal with is First People's bank.

[Dave Ramsey]

And then they just put that. Well, they just put that on a ten year fixed. Take it off a heloc, make it a ten year fixed fixed second mortgage. Because you got a three and a half. You're not going to. I normally would tell you to refinance and take, you know, wrap the HELOC and the first together. But if you do that, you won't be able to afford the payment.

[Caller or Guest]

Right. And what I have been getting at anyway.

[Dave Ramsey]

Yeah.

[Caller or Guest]

On refinancing.

[Dave Ramsey]

Yeah. And that's going to force the sale of the house which might be the net result of this whole thing of you closing down the business. You may be in a house you can't afford. I don't know. You can afford the 1,500 but you can't afford $350,000 in debt. That's what's weird. So I don't know how you got a $1,500 payment even at three and a half. On $260,000?

[Jade Washall]

Yeah. Did somebody put down a bunch of money?

[Dave Ramsey]

No. $260,000 debt. $1,500 doesn't support that. It's $18,000 a year.

[Caller or Guest]

We had. We live on family property and the property was given to us. So we put the property on collateral. And the house is actually a. We built the house in 2016. So at the time I was making really good money and we went that route for our future. And here, here we are. Now let's see. We built the house in 2016, so we're 10 years into it, four years with another employer.

[Dave Ramsey]

And are you, are you in the. Are you in the same business that you used to be in, but now you're an employee?

[Caller or Guest]

I am not. I am not.

[Dave Ramsey]

Could you start up the old business as a side hustle?

[Caller or Guest]

I do a bunch of side work. That's another thing I was going to point out is I do just about everything I can imagine to help pay off some of those special. That unsecured debt.

[Jade Washall]

Was that part of the 75 you said, or is that on top of that?

[Caller or Guest]

75 is my salary through my employer now.

[Jade Washall]

Okay, so tell us what you.

[Dave Ramsey]

I would restart your old business as a side hustle.

[Caller or Guest]

Hustle. Okay.

[Dave Ramsey]

Cause I think you can make the most money there. You know that business and you know how to make $160,000 a year doing it. And there's plenty of work out there right now, so.

[Caller or Guest]

But.

[Dave Ramsey]

But you don't. I mean, I stood as a side hustle. You don't have to quit completely and you don't have to go all the way back. And if you want to shut it back down after you get your HELOC cleaned off, that's fine, but. And then I would start talking to the bank about putting that heloc on a 15 year fixed or a 10 year fixed or whatever. And no balloons and no calls bearing down on you in the future. I don't want this thing to pop on you later, but that gets the problem off of you. And then basically you're doing cleanup from the debt that was left over when you didn't transition out of the business fast enough.

[Caller or Guest]

Correct?

[Dave Ramsey]

Yeah. And it's going to take you a little while to clean that up. But let's just say you made an extra a 50 as side hustle in two years, you paid off your HELOC.

[Caller or Guest]

True.

[Dave Ramsey]

That's what I want to do.

[Jade Washall]

Yeah. That's 100% possible because that just puts you back at your old income. If you do that.

[Caller or Guest]

Yeah.

[Dave Ramsey]

And then. Then you got to decide long term, you know? Have I. What happened was you got, You know, you got sliced and diced by the COVID situation and you came in out of the cold. You wanted a place that felt safe in a rough and tumble war zone. I wanted a place where I could come. A bomb shelter I could come into. But it cost you because you're only making 75 and you used to make 114 to 160. So it's cost you $50,000 a year to have a safe place to heal. But so I want to also challenge you that that doesn't mean you need to be there 38 years.

[Jade Washall]

Yeah. It's time to get back at it.

[Dave Ramsey]

You may need to step back out and maybe the side hustle's a way for you to test your footing again and see if you've got emotionally you're ready to go back out in the cold because you're taking a beating on what you could be.

[Caller or Guest]

Foreign.

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[Jade Washall]

Plus, you get more flexibility.

[Caller or Guest]

There are no network restrictions, and you don't have to wait for open enrollment. Now let's Talk about how CHM helps your budget because programs start at just $115 a month and many families save hundreds of dollars a month compared to traditional options. So if you are tired of feeling stuck, check out Christian Healthcare Ministries. Right now, CHM is offering new members a 50% credit towards their first month of membership. Go to CHMinistries.org budget and use promo code RAMSEY. That's CHMinistries.org budget and Use promo code RA.

[Dave Ramsey]

Kaylee is with us in Austin, Texas. Hi, Kaylee. How are you?

[Caller or Guest]

Good. How are you doing today?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller or Guest]

I was just calling because I am on step two of the baby's steps of paying down my debt. But I have a decision to make. I have. I'm 24 and I haven't gone to college yet. And I was wanting to go to college to get my business administration degree. And even though I'm in baby steps number two. I was calling to see your opinion on if I should wait and just keep going with the baby steps and then go to college or bite the bullet, get take on the student loans and go to college now.

[Jade Washall]

Well, I definitely don't like the idea of you taking on student loans. How much will it cost for you to get the degree? $12,000 total or per semester?

[Caller or Guest]

The community college. And it'll be fully online.

[Jade Washall]

Okay, how, what made you just to decide on that? How did you come about saying I want to, I want to do this? What's your, what's your path here?

[Caller or Guest]

I've always been kind of a admin girl. Always been the person behind the scenes doing like data administration and making coordinating and stuff like that. And after doing a lot of research, I found that if I get a business administration degree, it's broad enough of a degree that I can go from either hospitality to hospital services to maybe going in white collar. And so I figured getting this degree would be the best way for me to move forward.

[Dave Ramsey]

Okay, so are you talking about a business administration degree? Are you talking about a two year program?

[Jade Washall]

An associate's degree?

[Caller or Guest]

Yes, sir, I am talking about an associate's degree.

[Dave Ramsey]

Okay. All right. I was making sure I understood what you're doing. Okay, and what do you make today?

[Caller or Guest]

I make gross 20. 2400amonth.

[Jade Washall]

2400amonth. Doing what? The same work. Administrative. Administrative work?

[Caller or Guest]

Sadly, no. I'm actually a cook. I work at a daycare.

[Jade Washall]

Okay, cook at a daycare. How much debt do you currently have?

[Caller or Guest]

8771 rounding up.

[Jade Washall]

Listen, I'm not mad at a $12,000 degree. If you, if you have researched that it's going to be the path to get you in the spaces you want to get to. I do like the idea of you buckling down for a few months and paying off the 8,000 first and then cash flowing this, because I don't see why you can't cash flow this. How much? Oh, let's see. How long will it take you to pay off the 8000 making 2400.

[Caller or Guest]

I'm actually about to hit a really good point in my snowball method. I'm about to pay 1 of my debt down and basically I'll have it done within the next 18 months in total.

[Jade Washall]

So if you can do, if you can do 8,000 in 18 months, then can you do the 12,000 over the course of two years? I think you can. And I think you could probably do that in less time. You might be Able to do the 12,000 in 18 months because the debt will be totally gone.

[Dave Ramsey]

Hey, Kaylee, are you saying $2,400 take home?

[Caller or Guest]

So my take home is roughly 2,200. So about 1100 a check.

[Jade Washall]

And you're living at home?

[Caller or Guest]

I live in an apartment.

[Jade Washall]

What are you paying for rent?

[Caller or Guest]

So rent in total is 1200. I split it with my partner, with my boyfriend.

[Dave Ramsey]

Have you. So are you making $15 an hour?

[Caller or Guest]

1550, sir.

[Dave Ramsey]

Yeah, that's what I thought. Okay. So it just feels to me like you could probably make more doing almost anything else. Like Target is paying $20 an hour.

[Caller or Guest]

Oh yeah.

[Dave Ramsey]

So I think you need to be looking to up your income and pick up. And pick up some side hustles. Both. I think your job sucks. Your current job, it doesn't pay much.

[Jade Washall]

It doesn't.

[Dave Ramsey]

I'm very impressed that you've put together a sustainable life with $2,200 take home pay in Austin, Texas. You are an impressive young woman that is very responsible. You've been very careful. You've been extremely frugal. You are very, you know, and you're thinking into the future. At the same time, you're an impressive young woman. So I want you. I think you're worth a lot more doing some other things in the meantime while you're getting this degree than they're paying you to cook at the daycare.

[Caller or Guest]

Okay.

[Dave Ramsey]

So let's go job hunting in your off time and pick up two things. One is a better day job and two is an even better side hustle that pays 25 or $30 doing something. I don't care what. I think you could babysit for neighborhood kids and make $30 an hour. $25 an hour if you could find a nanny job, you know, and you know, anything that is these days in freaking Austin, Texas. So it's not exactly a poor market of some kind. So yeah. I want you to place more economic value on your hours than you have so far. Cause I can tell that you're worth it. And so what I'm saying is I think between those two things, you probably are gonna double your income.

[Jade Washall]

Yeah. And then you're out of this.

[Dave Ramsey]

That clears that debt really Fast and puts $12,000 in your pocket to get your degree real fast. And then you're doing all of this in 12, 14 months and you're rolling right along. And that's the path I would want to be on if I'm you. I got a feeling you're going to be fine. You're Going to be fine. You're going to find your way through this. But the question is just what's the most efficient method for you to get through this? Because you're a survivor and you're a planner and a thinker. So.

[Caller or Guest]

Wow.

[Dave Ramsey]

Very impressive. Cool. Hey, thanks for calling. Andrew's in Norfolk, Virginia. Hi, Andrew, how are you?

[Caller or Guest]

Hi, Mr. Ramsey. I am doing fine. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller or Guest]

So my question for you today is how do I save for retirement when I have a low income?

[Dave Ramsey]

Why do you have a low income?

[Caller or Guest]

So currently I am working for a church. I'm on pastoral staff and my income that I get to take home every month is low because they give me a lot of benefits when it comes to housing, phone, gas, daily.

[Dave Ramsey]

What is your take home? What do you make?

[Caller or Guest]

I'm taking home about 2,000amonth.

[Dave Ramsey]

And what is your position with the church?

[Caller or Guest]

I would be their assistant or youth pastor.

[Dave Ramsey]

Okay.

[Caller or Guest]

All right.

[Dave Ramsey]

We work with about 50,000 churches in the last 10 years and the numbers that we have say that somewhere around 80% of the pastors in America are bivocational.

[Jade Washall]

Have to be.

[Dave Ramsey]

That means they have another job.

[Caller or Guest]

Yes, sir. Yes, sir.

[Jade Washall]

How old are you?

[Caller or Guest]

I just graduated from. I'm 24 years old.

[Jade Washall]

I mean this is very similar to the Last Call in that way. You've got to be able to, you've got to be able to sustain a life. And I don't think you can on $2,000 a month even if you lived at home, even if you, you know, had a great benefit of, you know, whatever it is that they're offering you.

[Dave Ramsey]

Are they furnishing housing?

[Caller or Guest]

Yes sir, I get about a fifteen hundred dollar a month housing allowance.

[Dave Ramsey]

Yeah, okay.

[Caller or Guest]

Yes, sir.

Yes, sir.

[Jade Washall]

In addition.

[Dave Ramsey]

All right, well, so here's the thing. So you have a $3,500 a month income.

[Caller or Guest]

I'm not able to touch that housing. I know. For personal funds.

[Dave Ramsey]

I know, I know how it works. And so the. Yeah, you'll get into all kinds of tax issues if you do and so will the church. So we don't want to do that. But bottom line is, is you're, it's as if you have a fifteen hundred dollar house payment and you make three thousand five hundred dollars. How can I get ahead? You can, you can. And until your income comes up. But the way you ask the question, it says if you're going to have this exact income when you're 54.

[Jade Washall]

Right.

[Dave Ramsey]

And therefore we can't save for retirement. I mean, in the meantime, you may have to work a side hustle. Bi vocational pastor would not be that unusual. And so the pastor that led me to the Lord when he was starting his church had a bread rat and you know, later on he was the pastor of a huge church and obviously was full time at that point. But that's what I want for your future is God's call on your life. In the meantime, you may have a bread route, but you've got to have a long term game plan that says I'm not going to have a low income the rest of my life and then that allows you to invest and to be generous and to do other things. If you run a business, you already know this. Bad information leads to bad decisions. And right now, now AI is everywhere. But AI is only as good as the data behind it. The best AI is built on the best data. That's why I recommend NetSuite. NetSuite is the number one AI cloud ERP and more than 43,000 businesses run on it, including us here at Ramsey Solutions. Their AI isn't bolted on, it's built in. And it connects everything that runs your business, accounting, inventory, customer data, all in one place. Because when your numbers are connected, AI actually works like it's supposed to. NetSuite's AI helps flag cash flow problems, spot inventory issues, close your books faster, and cut down on manual reporting. If your revenue is at least seven figures, go to netsuite.com Ramsey for a free product tour. That's netsuite.com Ramsey. Ramsey Show Question of the day is brought to you by why Refi out of Control Private student loans can make it feel like you're stuck financially. But why Refi helps borrowers explore refinancing with low fixed rates and payments that make sense for their budget. Visit yrefi.com Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[Jade Washall]

Alrighty. Today's question comes from Scott in Oklahoma. He says, My 2003 Toyota has 226,000 miles on it and I recently discovered it needs a replacement suspension system and an oil leak repair. The lowest quote I've gotten is 8,500 to fix all of the issues. The car's paid off, but I already have put $10,000 into it over the past five years. I make 50,000 per year and don't have any debt. I have the money to fix the car, but it would deplete my emergency fund. Should I get this old car fixed or should I put that Money towards a newer car. I feel like this is a really simple one. I gotta believe that Toyota is probably not worth any more than $2,000. So for reason, I would invest in a new car for you if you're able to drive it a little while longer. I don't know if you can. I'd maybe try to save up as much as I can to put with the 8500 so that you're not fully depleting that emergency fund. But it is time for a new

[Dave Ramsey]

vehicle and you're paying cash. This is not your down payment.

[Jade Washall]

Yes.

[Dave Ramsey]

So you're gonna buy a 6 or $7,000 car which is going to upgrade you about 5x.

[Caller or Guest]

Yeah.

[Dave Ramsey]

So yeah, yeah, you're in good shape to pay cash for a sizable upgrade and. And then replenish your emergency fund as fast as you can instead of doing the repairs. But so the go ahead.

[Jade Washall]

What should have been happening just to kind of go back in time, Scott, you know, you drive a 2003 Toyota with almost 250,000 miles on it. You should have been putting money aside to upgrade this car over time, not just an emergency fund. Because that's the part I feel like people forget about. The Ramsey plan is I love that he has a paid for vehicle. I love that he's living that life. But you've got to remember that you've got to have money to the side that you're planning on upgrading that vehicle. Because you can only drive a 2003 for so long.

[Dave Ramsey]

Yeah. That's assuming he hadn't spent the last 24 months getting out of debt and just now got to this point.

[Jade Washall]

That's also true.

[Caller or Guest]

That's also true.

[Dave Ramsey]

If he just got to this point, then that's different. But if he's been going along at this point point and not saving for a car, then you're exactly right.

[Jade Washall]

Yeah.

[Dave Ramsey]

So here's a good formula for you guys. Okay. What is the car worth salvage today? And so you can sell this car with an oil leak because it's gonna. Because 2003 with 226,000 miles. It's gonna have an oil leak. That's what you sell this car with. It's an oil leak. Okay. And it's not gonna have a wonderful suspension because it's got 200,000 miles on it.

[Jade Washall]

Exactly.

[Dave Ramsey]

So that, that, you know, that makes this whatever a 1500 $2000 car.

[Caller or Guest]

Car.

[Dave Ramsey]

Okay. And so you sell it for that. If you did the repair, does it add the value back? Okay. Equal to the repair. So how the how the formula works on that is let's say that this is a $7,000 car if it's fixed, but you can sell it for two. Well, two plus eight is 10. So you would still not fix this car. It's overpriced because you're going to have more in the car what you can sell it for, plus the repair is going to be more than the car is worth after the repair. And if that's the case, that tells you this is a throwaway car and you go buy you another throwaway car if you have to. In this case, he's got the money to move up quite a bit and move into a 7,000 or $8,000 car. If he sells this for two, puts six in, he's still got some couple grand in his emergency fund to start rebuilding.

[Caller or Guest]

Right.

[Dave Ramsey]

And that's the kind of thing you're going to do there. And then have a plan, like Jade was saying, to move up again in two years.

[Jade Washall]

Right. Because the $8,000 car is only going to last.

[Dave Ramsey]

You start paying yourself $500 a month for two years, that's another $12,000. And you put that with the car that you bought for 7,000. The good news about a $7,000 car, it's not going to go down a lot two years from now. You sell it for six if you bought it. Right, right. And yeah. And now we've got an $18,000 car.

[Jade Washall]

Yeah.

[Dave Ramsey]

That we pay cash for.

[Jade Washall]

That's the.

[Dave Ramsey]

That starts to make a lot of sense, making 50 grand.

[Jade Washall]

It does well, at any rate. Really. Because I think that of all the things we teach, the cash car is the most elusive of the, of the principles. I think people who are driving cars with car notes, they're driving a, you know, 20, 26, 20, 25 vehicle. They hear you and I say things like, you know, the car payments keeping the middle class broke, and they think, well, what am I supposed to do? Just hand over $30,000 and.

[Dave Ramsey]

No, you're supposed to hand over $4,000 and pay yourself $1,200 a month.

[Jade Washall]

Yes.

[Dave Ramsey]

Instead of paying bank of America, screw me, twelve hundred dollars a month.

[Jade Washall]

Exactly. That's what it looks like, though, to stair step up.

[Dave Ramsey]

And yeah, you pay. If you pay yourself a car payment for 10 months, that's a lot. What a lot of people have a thousand dollar car pay.

[Jade Washall]

Yes.

[Dave Ramsey]

That's 10,000 freaking dollars in 10 months. You know, how much patience do you have? I mean, you can do a lot of bad transportation for 10 months and get by with It.

[Jade Washall]

That's right.

[Dave Ramsey]

I mean, you could drive the hoopty of hoopties for 10 months. A thousand dollar car, you know, it's predominant color is bondo.

[Jade Washall]

Yeah. You know, a two car family can be a one car family for 10 months. Well do a lot.

[Dave Ramsey]

You know, we had a guy working here at one point that, you know, their second car was a car he bought at salvage that was perfect condition. Engine and drive and transmission. Interior was perfect condition. But it had been in a hailstorm.

[Caller or Guest]

Oh.

[Dave Ramsey]

So it looked like it had Terrible.

[Jade Washall]

Yeah.

[Dave Ramsey]

It was really. It was really pop marked all over. It was the ugliest, funniest looking car. Cause it had had the snot beat

[Jade Washall]

out of it and what does he care?

[Dave Ramsey]

And it looked like somebody walked and hit it with a hammer all over. Right. But it worked perfectly. And the interior was perfect, the technology was current, but it was a salvage car completely. And he said for right now, instead of having a car payment, I paid $2,000 for what would have been a $15,000 car. But it looked like somebody hit it with a hammer all over. We really made fun of the guy, but he was classic Ramsey guy. Right. And he did that for a year and paid himself a car payment and then went and bought a regular car.

[Jade Washall]

That's right.

[Dave Ramsey]

And he has a story to tell.

[Jade Washall]

Tell a great. That. That's a great story. Exactly.

[Dave Ramsey]

I love that. I come from a generation where we drove cars that were bad and we kept them so long that we named them.

[Jade Washall]

I was going to say it's got to have a name.

[Dave Ramsey]

It's got to have a name. The Blue Goose, right? Yeah. The Brown Shoe.

[Jade Washall]

That's so funny.

[Dave Ramsey]

The brown. Like the old woman in the shoe.

[Jade Washall]

Yeah.

[Dave Ramsey]

We had a. We had a station wagon named the Brown Shoe.

[Jade Washall]

Wow.

[Dave Ramsey]

It was. Seriously, it's got to have special, special.

[Jade Washall]

What I call special features.

[Dave Ramsey]

Yeah. Which are the windows that don't go down properly.

[Caller or Guest]

Yeah.

[Dave Ramsey]

The door that won't lock. All that stuff. Yeah.

[Jade Washall]

The tape deck that eats the tape or eats the CD. Nobody even uses tapes and CDs anymore.

[Dave Ramsey]

Yeah. See now, now you're getting old. That's what's happening. Right.

[Jade Washall]

Well, your car is so old it

[Dave Ramsey]

has CDs in it. That's right. Yeah. It's a whole different kind of car. Yes.

[Jade Washall]

Yes.

[Dave Ramsey]

Hey, all kidding aside, if you will drive like no one else later, you can drive like no one else. So Jade and I don't drive hoopties. I drive whatever I want to drive these days. And I can write a check and do it because I drove crap for a while so that I would never have debt again. And so it's not like we're saying drive a piece of crap car that your whole life, but for a short period of time, a year, two years, while you get out of debt, while you save up to avoid debt on the next purchase. You drive something that looks like a ball. Ping, hammer, hit it all over. You drive something that's named the gray goose. You drive something the brown shoe. I don't care what you name it, but it's the pitiful. And take pictures of it. So when you're old, you can tell your grandkids that are trust fund babies because you're a multi gazillionaire. Back in the day, grandma and I drove that car. And that's why you little brats have money. So you got to have stuff story to tell. Right? You got. You really got to have a way to do this.

[Jade Washall]

So I had a 1980. My first car was a hand me down from my sister. It was a 1984 Nissan Pulsar. And it only went forward. It couldn't go in reverse.

[Dave Ramsey]

So you have to choose your parking.

[Jade Washall]

Yeah.

[Dave Ramsey]

Spot carefully. Which means you park way out in the parking lot sometimes, all the time. Because you have to pull forward, right?

[Jade Washall]

Yes.

[Dave Ramsey]

Oh, my God. That's so terrible.

[Jade Washall]

It had to be warmed up. Like, the transmission had to be warmed up for quite a while before I would even think about going in reverse.

[Dave Ramsey]

We need to do a show where we ask everybody their worst car they've ever owned. Yeah. So my wife. My wife's first car when we got married was a Pinto. The ones that were blowing up.

[Jade Washall]

Yeah.

[Dave Ramsey]

Yeah. The Pinto and the Vega and the Gremlin have been named the worst cars of the 70s.

[Jade Washall]

That's so.

[Dave Ramsey]

And my wife had one of them.

[Caller or Guest]

Sam,

[Dave Ramsey]

Are you sick and tired of being sick and tired, working so hard but having nothing to show for it? Feel like a rat in a wheel well? You don't have to live that way. You can get on the Ramsey plan. We will work you through this, get you out of debt, into wealth. The every dollar budget app will lead you right along the way. It'll give you answer questions. It'll hold your hand like you were on this show. And us telling you what to do. It's gonna build you a personalized plan to get out of debt and become wealthy. In just 15 minutes, you find thousands of dollars in hidden margin. You're gonna feel like you got a raise. Don't live normal when you can live like no one else. Start every dollar for free in the App Store or Google Play. Connor is in Riverside. Hey Connor, how are you? How are you?

[Caller or Guest]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller or Guest]

So I graduated from college last year and I got a job making 88,000 per year. I'm still living with my parents and on my current budget I can save 100,000 by the end of next year. And I want to know if I should, if I should move out at this point or if I should wait till I can save more to put a bigger down payment on a house.

[Jade Washall]

Well, I was going to ask what's what the goal, the specific goal is and it's to put, put a down payment on a house. How much do you need? Like what's the monetary goal?

[Caller or Guest]

Well, in California a decent house is around 700,000. There's some that are less but worse neighborhoods. So I try to buy on a budget to buy a house around 700,000 and I'm on track. If I keep doing what I'm doing, I can save 100,000 by the end of next year. And yeah, to go to buy a house and to do it without having to take on a huge mortgage and to keep the payment underneath like 30% of my take home pay.

[Dave Ramsey]

What are you doing for a living?

[Caller or Guest]

I do supply chain analytics.

[Dave Ramsey]

You got a logistics degree?

[Caller or Guest]

Yeah, I have a bachelor's degree in business majoring in supply chain.

[Dave Ramsey]

And you're only making 88 grand?

[Caller or Guest]

Yeah, well, only one year. One year in.

In.

[Dave Ramsey]

Okay.

[Caller or Guest]

And I'm trying to make more money. I'm gonna go for a master's degree. That's gonna come.

[Dave Ramsey]

You don't have to have a master's degree to make more money. With a logistics degree you're gonna be just.

[Caller or Guest]

Yeah, I'm trying to do a free.

[Dave Ramsey]

Yeah, you're sitting on125,000 salary any minute. Wow. What good degree choice. Let me start there.

[Caller or Guest]

Yeah, yeah.

[Jade Washall]

What do you see yourself earning a year from now, which is. Is the time that you want to live at your mom's house. Do you see yourself.

[Caller or Guest]

125 at least I want to make more and make more.

[Dave Ramsey]

Yeah. Okay. So here's the trade off. The way you have analyzed this and it comes from the way your brain works, which is awesome by the way. I'm thrilled with the way you're looking at things is that there is no downside to living there. And the upside is I'm stacking cash because you get along with your parents obviously or you wouldn't even be asking this. You don't have a strained situation there. It's comfortable. And so it appears to be a no brainer to stay here and live here for free and stack cash. The unintended consequence is that you haven't started your adulthood completely. As long as your mommy is in the house.

[Caller or Guest]

Yes.

[Dave Ramsey]

And when one of my children came home from college and their apartment was their new place to set up. House wasn't ready yet. They stayed with us for about three months which was just fine because we love them and they were. We get along and there was no issue. But I will tell you that as soon as that child moved out and paid their own bills and bought their own milk and had their own electric bill, it changed their posture, it changed the way they walked. More confident, the swagger, the everything. And yeah it. And not to mention for some ladies it would change your eligibility as a date.

[Jade Washall]

Come on Dave.

[Dave Ramsey]

Whether you live at your mommy's or not.

[Jade Washall]

Yeah. I gotta say I think there's two throughout.

[Dave Ramsey]

I'll say there's non monetary things here that might be more important than the money.

[Jade Washall]

That. That's true. But even, even the money. I don't think that your math is quite right. Because a $700,000. A $700,000 house that you've put a hundred thousand dollars on is not going to get you where you need it to be. Even making 125.

[Dave Ramsey]

True.

[Jade Washall]

You're going to be well above. I mean I'm just plugging the numbers in on our mortgage calculator and I just. I think you need to rethink your math on that. That being said, I don't think there's a rush. You're 22, which means you'll be 23 years old. You don't need a 700000 house at 23 years old.

[Dave Ramsey]

Yeah.

[Jade Washall]

In your first year of working. Right. Like let's.

[Dave Ramsey]

Or second year.

[Jade Washall]

Yeah. Let's create some stability. Let's make sure that this is really the field we want to be in. Let's make sure this is the area we want to be in. Give yourself some freedom by just renting. Get an apartment. I love that for you.

[Dave Ramsey]

It's not horrible. Yeah. If I woke up in your shoes knowing what I know about money and life, I would move out. Even though on the surface the economics don't look that favorable when you do that then I would also value your. I think you're worth more than you're being paid probably in the marketplace right now. Job market's a little slow right now. It's sluggish. But. And then the other thing that comes to mind that you may or may not want to consider is that you might be able to make $125,000 in Kansas City.

[Jade Washall]

That's a good point. Yeah.

[Dave Ramsey]

Which would cost you half as much to live as Riverside, California.

[Jade Washall]

That's true.

[Dave Ramsey]

And the only reason you're there today, or at least one of the reasons you're there today is because you grew up there.

[Jade Washall]

Yeah. Yep.

[Dave Ramsey]

And I'm not suggesting you have to move to be successful, but there's something about when you move out that that option starts to be there that's not emotionally setting itself in your brain when you're staying at home.

[Jade Washall]

Yeah, I agree with that.

[Dave Ramsey]

And so I want you to go out and have a life and let's just see, let's live the grand adventure.

[Jade Washall]

And then you're also not comparing your current life to your parents life wife who has spent 35 years getting there.

[Dave Ramsey]

Yeah, yeah, they've been, they've been trying to get. Yeah, you can't. You don't need a six. $700,000. I mean, $700,000 is not a fancy house in Riverside.

[Jade Washall]

No, it's not. But I'm just saying it's still a lot of money no matter how you slice it.

[Dave Ramsey]

Yeah, it's a lot of money. It's a lot of math in whether, regardless of what it buys. So. Yeah. Wow.

[Jade Washall]

Yeah. I. Now if he had told me he had a hundred thousand dollars of, of debt and he could live at home and pay it off in one year, I would probably change my mind on that. I would probably go, hey, if you can do it and you can knock it out and there's a clear timeline and there's a clear amount, I'd probably be fine with that. He is going to sacrifice some of the things that you said.

[Dave Ramsey]

Yeah. I'm not sure that I have adequately thought through and quantified what living on your own is worth.

[Jade Washall]

Well, it's at.

[Dave Ramsey]

It costs more, but I think it's worth more than it costs. And I can't put actual dollars to that off the top of my head like I can some things to justify my position. So my position might be weak.

[Jade Washall]

There's gotta be. You gotta consider your age range. Cause I think the older you are, the more it hits. You know, you can't be 33 living at Mom's house.

[Dave Ramsey]

Yeah, 19 is a little. I can give you a Little break there.

[Jade Washall]

I'm like 21.

[Dave Ramsey]

Hey, he graduated from college in 19.

[Jade Washall]

Yeah.

[Dave Ramsey]

That's like two years early. Three years early.

[Jade Washall]

Yeah, he's a little bit of a super genius.

[Dave Ramsey]

Yeah, we got some savant stuff going on here. Yeah, that's interesting. I'm treating him like he's 22. That's a good point too. Interesting, interesting. This is a good discussion. Connor, you're a sharp dude. You're gonna be okay. You don't have to buy a house in one year. And there are benefits to moving out that you haven't considered. And that's a summary of what we have yacked about and gone around the barn for the last few minutes. But it's good. I appreciate you letting us use you to have the discussion for America because there is the old movie failure to launch. There is a problem in America particularly disturbing among males that are not leaving home. Now you're not the 33 year old. Living at home is a problem.

[Jade Washall]

I, I, you know what, Dave? I actually do think it's both. I think it's men and women, but I do think that it is more frowned upon. And I'm not saying right or wrong,

[Dave Ramsey]

but I feel like it's because I'm a sexist boomer.

[Jade Washall]

We get more of the ick when we see a guy living.

[Dave Ramsey]

Yeah.

[Caller or Guest]

At home.

[Dave Ramsey]

And you're a sexist. Whatever. If you're not a boomer. If you just said that. Yeah, I get ick with a guy being at home. Yeah, yeah. But it is, it is. But still, I mean, I, you know, go be like a grownup.

[Jade Washall]

It's okay to be broke and be on your own and be single and make your way, have dignity and yeah, that's part of life.

[Dave Ramsey]

But you're not, you're not 33, you're 19. So if you want to hang out one more year, we're not going to be mad at you.

[Jade Washall]

It's true.

[Dave Ramsey]

Welcome back to the Ramsey show in the Fair Winds Credit Union studio. Renee is in Los Angeles. Hi, Renee. Welcome to the Ramsey Show.

[Caller or Guest]

Hi, Dave. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller or Guest]

I was hoping you could help with a disagreement me and my husband are having. So we'd like, I'd like to pay off debt. We have about 16,000 in consumer debt debt and we make about 11,000amonth. My husband would like to pull out from our, what is it? Stocks to pull out all of our stocks to pay off the debt. Whereas I'm on the side of, I think we can Make a lifestyle change and pay it off in three months. Right now we have one income. He is able to work and he can bring in an additional 7,000amonth, and we should be able to pay this off even faster.

[Jade Washall]

Why isn't he working now?

[Caller or Guest]

We just kind of have been living a cushy life, very, very luxury. There's really no particular reason.

[Jade Washall]

How cushy a life are you living in California on 11,000.

[Caller or Guest]

It just happens to work for us. The rent's pretty low and a lot of our expenses. We really don't have any car payments or anything else.

[Jade Washall]

Okay, that, that aside, I just want to. Does that bother you at all? I know that that's not pertinent to the question, but does that bother you?

[Dave Ramsey]

You

[Caller or Guest]

only up until recently, but for the most part, I was pretty content with it. Everything was getting done at the house. I had no complaints.

[Jade Washall]

Okay, so how much stocks, single stocks do you have that you could sell? What are they worth?

[Caller or Guest]

Not a ton. Only 28,000.

[Jade Washall]

Okay, but that's enough to clear the debt.

[Caller or Guest]

And still that would be enough to clear the debt. Yes.

[Jade Washall]

Okay. Yeah. So here.

[Dave Ramsey]

Yeah, here's the answer. Interesting to me. I think you're both right. I think you need to adjust your freaking lifestyle.

[Caller or Guest]

Yeah.

[Dave Ramsey]

And I think you need to cash out these stocks and pay off your debt.

[Jade Washall]

He needs to work. Regardless.

[Dave Ramsey]

The credit cards are the 16,000, right?

[Caller or Guest]

Correct. Yeah.

[Dave Ramsey]

Yeah. So that's financial laziness. You make enough money to not have run this debt up. You just weren't paying attention and you wrecked the car. Yeah, yeah. So, yeah. So have you cut up the credit card?

[Caller or Guest]

Yes, yes. This is actually old debt. So we've paid down about 30,000.

[Dave Ramsey]

Oh, good. Okay, that's good.

[Jade Washall]

That's good.

[Dave Ramsey]

So, yeah, number one, we're not going to tell you to have single stocks. We're going to have that liquidated. Put that in the emergency fund or put it towards your house or whatever, wherever you are on the baby steps, or put it towards this debt. Put it on this debt if you want. But then number two, we need to be on an every dollar budget where you've adjusted lifestyle. And the two of you are not, you know, you're not living beyond you. You've been doing that though, because you've reduced debt, so you're already doing that. So you, you feel like you, you just want to stay on the plan. I'm, I'm not catching up. I'm, I'm, I'm recycling here.

[Jade Washall]

It just sounds, I think what's going on is good. I think you've. It sounds like you've tightened up in order to pay the debt down to what it is now.

[Dave Ramsey]

Is that right?

[Jade Washall]

Correct.

[Caller or Guest]

Yes.

Yes.

So that tighten up. My only thing is I'm holding on to the stocks.

It.

It's a. A private stock that I have in a previous company.

[Jade Washall]

Here's the thing.

[Caller or Guest]

I do believe it's going to be like a high potential.

[Jade Washall]

Even if you didn't have the debt, I would give you the same advice. I'd say I'd rather you sell that stock and I'd rather you. Let's pretend you were on baby step four and you could invest in mutual funds. I'd still take that money and diversify it in that way. So the debt really has nothing to do specifically with that advisor. It's just at this point, this is money that you have access to that you can pull out and there really wouldn't be a penalty on it. It's not retirement money or anything like that. So for that case, I would take it out. I would put 16,000 towards the debt. The other 12,000 to Dave's point, you can throw that in a high yield savings account, have an emergency fund. Now we're setting ourselves up to really be able to invest the proper way. If we do that.

[Dave Ramsey]

Yeah, the stock. Renee, I had a guy offer me a position in a private company the other day that I could have bought controlling interest in in a private. In a private situation like that. And when you're. I didn't take it. And the reason is that typically a situation like that is all or nothing, meaning this stock's going to tank and it's going to be worth very, very little and it's going to be a problem or it's going to go the moon and it's going to be the smartest thing you ever did. It, it's never in between. It's not a predictable environment. It's a high risk investment.

[Jade Washall]

But the thing is.

[Dave Ramsey]

So if you can get out of it, if you can get it out, I didn't do it.

[Jade Washall]

I'm saying. But if anybody could be in a position to just.

[Dave Ramsey]

I could have lost the money and not. I'm not blinked. But yeah, but the point is, the point is she doesn't need to be doing that. And so you're only looking at the upside and you're emotionally involved because it was the last company you worked in and you, you think those guys are smart and they may be smart and it might go to the. If it doesn't. It's going to go to zero. And if you had $28,000 in the middle of your kitchen table right now, would you go buy that stock or would you pay down the debt? I'd pay down the debt 100% and I'd cash out the rest of the stock and I'd put it in a stable investment that was much more predictable. So I don't know if you're going to do any of that, but that's what we would tell you to do. I'd cash out the 28. I would continue the adjustment on the lifestyle. You're both right.

[Caller or Guest]

Yeah.

[Jade Washall]

And a husband needs to do something. Now, don't get me wrong. I love when people have worked to create flexibility in their lives. I think that's great. But I think he's gonna need a sense of direction and purpose and that's what he needs. If he doesn't need it for the paycheck, he needs it for the sense of direction and purpose.

[Dave Ramsey]

Jenna is in Oklahoma City. Hi, Jenna, how are you?

[Caller or Guest]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller or Guest]

Good. Hey. So my husband and I have about $80,000 of non mortgage debt that we're working through. We're on baby step number two and my husband runs a landscaping business. And so our tax accountant has told us to save 15% of his gross revenue and throw it in some sort of savings account that we don't touch just for tax purposes at the end of the year to cover any unexpected tax burden we might not be prepared for. But I have about $9,000 in that account right now. And I'm just wondering if I should be using that to clear any of our debt instead of just holding onto it for taxes.

[Dave Ramsey]

You hold onto it for taxes. That money's already already spent. It's got the IRS's name on it.

[Jade Washall]

And I probably would have done 20%, to be honest with you.

[Dave Ramsey]

We recommend 25% of your net profits, not 15% of your gross. You may be saving too much for taxes. We don't know that yet, but don't screw around with the irs.

[Caller or Guest]

Got it?

[Dave Ramsey]

Yeah. Keep your tax. Keep your tax money sacred. It's not even there emotionally. Now, you may want to adjust the formula after you've done a year or two of this, but you do need to be setting aside and be paying quarterly estimates. And they're usually going to approach about a 10% tax rate on your net profits plus 15% of self employment tax. Because, you know, if you're an employee, you pay 7.65, but if you're self employed, you pay both sides, the employee and the employer. So you pay 15 6, 15 7. So you know, so you've got a 25% hit there of your net profits probably is going to be pretty accurate for your quarterly estimates and then your total tax bill. Don't mess around with that money. Now if you're over saving and you can prove that mathematically, if you saved $4,000 more than you need and you can prove that mathematically, then sure, take that money and throw it at the debt. But that money, that please don't mess around with it. Your accountant really gave you great advice to make you start withholding on yourself because it's one of the small business. People get hit in the head like this the most of anything I see they don't do their quarterlies and then the IRS comes up and smacks them.

[Caller or Guest]

It.

[Dave Ramsey]

Hey, George Camel here. We often talk about how being normal sucks when it comes to your money. But guess what? Normal isn't so great when it comes to your job either. Normal is staying in a job you hate, dreading Mondays, and working for people you don't even like. Sound familiar? Well, the good news is you can break free from normal because Ramsey Solutions is hiring and we refuse to settle for the ordinary. In fact, we are anything but normal and we are proud of it. And right now we're hiring for technology, sales, marketing, writing, copy editing and creative roles. So head over to ramseysolutions.com careers and apply today. Time is running out to enter the Ramsey Cash Giveaway. You can enter anytime between now and May 31st to increase your chances of winning the $500 weekly prize and the $10,000 grand prize. Obviously, no purchase necessary. No salesman will call. Be sure to check out our sale though, while you're on the site. Right now you can kick off your summer with books and assessments for only $12 for hardback book.

[Caller or Guest]

Wow.

[Dave Ramsey]

Yeah, I just jumped online and bought. A friend of mine has a new fiction book coming out and I just jumped online and bought it.

[Jade Washall]

Oh, your Navy Seal.

[Dave Ramsey]

Yeah. It was not $12.

[Jade Washall]

I'm sure it was not.

[Dave Ramsey]

It was a lot more than $12. Ramseysolutions.com giveaway. Hit that right now and you can enter and you can also check out the $12 books. That's a good deal. All right. Gene is with us in Chattanooga. Hi, Gene. How are you? You?

[Caller or Guest]

I'm fine. Thank you so much for your ministry.

[Dave Ramsey]

Thank you.

[Caller or Guest]

How can we Help someone use my stolen ID electronically to open a checking account in another bank and stole funds from one of the accounts that I have with a wealth management company where

I have retirement and investments.

[Dave Ramsey]

Wait, wait, wait. I'm sorry. They opened a checking account at another bank? How were they able to steal funds from. From your wealth management company?

[Caller or Guest]

They used the checking account electronically to go into the wealth management company.

[Jade Washall]

And so they had all your information to do this?

[Caller or Guest]

They evidently did. And, and I never have managed any of those accounts by phone or direct. Electronically. I've always done by phone or direct mail.

[Dave Ramsey]

So why is your wealth management company not liable?

[Caller or Guest]

That's my question. Are they not liable? Because this loss I sustained was not associated with, you know, market value. Valuable.

[Dave Ramsey]

It was. They got hacked. Yeah, their site got hacked by an identity thief. I think that's on them.

[Caller or Guest]

Okay.

[Dave Ramsey]

I'm not sure. I'm not an attorney, but that's what it sounds like from a common sense perspective.

[Caller or Guest]

Yeah.

[Dave Ramsey]

How much money did you lose? Lose?

[Caller or Guest]

45,500.

[Dave Ramsey]

How old are you?

[Caller or Guest]

I'm 84.

[Dave Ramsey]

How much money was in the account total?

[Caller or Guest]

Oh, goodness. I would have to look that up, but I don't.

[Dave Ramsey]

A lot.

[Caller or Guest]

I think it was about 100.

Let me see.

[Dave Ramsey]

Why did they only get 45?

[Caller or Guest]

I don't know. I have a hundred sixty nine thousand seven hundred and ninety in there.

[Dave Ramsey]

So why did they not get it all?

[Caller or Guest]

I don't have a clue. Maybe they thought, you know, they could get some you call.

[Dave Ramsey]

But you called your wealth management company. What did they say?

[Caller or Guest]

They, they were. I would never have known about it if they hadn't sent me a letter asking if I had changed my email and my bank account. And of course right away then they tried to reverse the. Of the transaction and by then of course the money was gone. So.

[Dave Ramsey]

So, but they is. Did you leave the rest of your money there?

[Caller or Guest]

Well, right now I haven't changed anything, but I intend to. I just don't know whether. Whether I should change my, my management company before they refund my money or whether I need to.

[Dave Ramsey]

Well, you need to, you need to make sure. I'm going to have a discussion with them on the phone as soon as you hang up with us. That make sure that the remaining money is safe. Yeah, that's the first thing. We gotta make sure that's safe. And then the second thing is when are you guys going to refund me the money that you lost? Because your account that I have with you was hacked.

[Caller or Guest]

Correct.

[Dave Ramsey]

I'm going to ask them to refund this. I don't know that that's going to work because I'm not an attorney. Okay. But I think that they're going to be liable for that.

[Caller or Guest]

That.

[Dave Ramsey]

Because their account got hacked. I mean, so let's pretend you had a savings account at a bank and a thief got into the savings account on the bank and stole the money. It's the same thing.

[Caller or Guest]

Yeah, the bank would be.

[Dave Ramsey]

The bank would be liable. So I'm pretty sure this wealth management company is liable for this.

[Jade Washall]

Now, it's on both end. It's on. There's issues on both ends. Because if they were able to set up another bank account account with your information, then if they were able to use that to connect the two banks,

[Dave Ramsey]

they've got a lot of people who did this. Gene, do you know the person that did this?

[Caller or Guest]

No, I don't know who it was.

[Jade Washall]

Okay, then you've got it.

[Dave Ramsey]

They got a lot of information on you.

[Caller or Guest]

They do.

I know. Okay. And. And let me tell you what I've done. I have subscribed to Xander Insurance.

[Dave Ramsey]

Good, good. Are they helping you, the ID theft people?

[Caller or Guest]

Oh, no, Xander is. It was after the fact.

[Dave Ramsey]

I know, but did they offer to help anyway?

[Caller or Guest]

They just. I don't know if they would or not. I didn't ask them.

[Dave Ramsey]

Yeah, I'm going to ask them to help you. Okay.

[Caller or Guest]

All right.

[Dave Ramsey]

As a favor to me, they're friends of mine and my 84 year old friend Gene in Chattanooga needs some help and I'm going to ask them to help you, even though you bought the insurance afterwards. Okay. So I'm gonna put you on hold and the gang in the booth is gonna pick up and connect you with Jeff Zander, who's a friend of mine, and they're gonna help you walk through this and make sure your identity is secured, first and foremost. And then secondly, if you need some help, we'll hook you up with one of our Ramsey coaches, Ramsey Financial coaches, as a gift also, no charge. And see if they can help you navigate with this wealth management company. Because they need to be offering me my money back really fast if they want to keep me as a customer.

[Caller or Guest]

If I'm in your shoes, definitely.

[Dave Ramsey]

Okay. So.

[Caller or Guest]

And I tried to, you know, I tried to get legal advice here and I went to the bar association and they made a couple names and I, I queried them, but they didn't even respond. So I guess I, I'm just peanuts, you know, to them.

[Dave Ramsey]

Well, the $45,000 is peanuts, but you're not peanuts.

[Jade Washall]

That's right.

[Dave Ramsey]

Okay. You're okay. You're going to be all right. But what we have to stop this from happening anymore and we have to apply for and get the refund. And I think between our Ramsey coaches and Xander, which is going to cost you nothing, we're going to take care of all of it. We're gonna make sure you're okay. But you need to get on the phone today and make sure the rest of your accounts are secure with those people in the meantime while you decide what's gonna happen. So you hang on and our gang will pick up and we'll put our arms around you and see if we can help you, kiddo.

[Jade Washall]

That's terrible.

[Dave Ramsey]

That's kind of scary.

[Jade Washall]

Yeah, that is. They got all of her stuff.

[Dave Ramsey]

I mean they not only knew enough to open an account, but they knew she had the other account to link it in and how to access it.

[Caller or Guest]

It.

[Jade Washall]

That's very scary.

[Dave Ramsey]

And these goobs release this money to a fresh email and fresh address that they did not already have on file

[Jade Washall]

because that means they went in and changed.

[Dave Ramsey]

Cyber security at a minimum is horrible at this company.

[Caller or Guest]

Yeah.

[Dave Ramsey]

Wow. She should have named if she's got the story straight. If that's what's going on. Yeah.

[Jade Washall]

Like drop the name of that brokerage so we can all know.

[Dave Ramsey]

We'll wait and see. Make sure. Make sure what they do. But yeah, it's. That's

[Jade Washall]

scary.

[Dave Ramsey]

Yeah. So when you have a brokerage company like that, like our smart Mr. Pros as an example, you, you build clients over time and in that world you call it your book of business. And how much do you have a U M assets under management. And so a big, you know, somebody's been working for 25 or whatever years will have half a billion to a billion, 500 million to a billion dollars in assets under management. And if one of Those clients had $200,000 out of your half a billion you're managing and was 84 years old, this would be her. That's the situation she would normally be in. But the way you get a book of business that size is you take care of people.

[Jade Washall]

Yeah.

[Dave Ramsey]

84 year old widows would be at the top of your list.

[Jade Washall]

You would think so.

[Dave Ramsey]

Hello. And so that's the proper way to run that book of business. The book of business grows when you love the people in the book.

[Jade Washall]

Well, what's curious serious is they only took 45,169. That makes. That sounds nefarious to me.

[Dave Ramsey]

I'm still Afraid a relative of hers is doing this.

[Jade Washall]

I agree with that, Dave.

[Dave Ramsey]

Ouch.

[Jade Washall]

Hey, what's up, guys? It's Jade Warshaw. Listen, summer spending adds up so fast. Between vacations and road trips and camp fees and events and all. All the extra gas and grocery runs, money can get tight before you know it. To really get your money under control and keep it that way, you're going to need a plan. And that's what you'll get with the EveryDollar budget app. It helps you track your spending, free up cash to put toward debt and savings, and it's the simplest way to make a plan for your money before the month begins. So no more wondering where your money's going. You're telling it where to go. Download EveryDollar in the app store or Google Play and start for free.

[Caller or Guest]

Free.

[Jade Washall]

Today,

[Dave Ramsey]

Renee is with us in Charlotte. Hi, Renee. How are you?

[Caller or Guest]

I'm great. Thank you for taking the call. I. The work you do.

[Dave Ramsey]

Thank you. How can we help?

[Caller or Guest]

My question is regarding how much I should pressure my teenage daughter to apply for scholarships. College scholarships.

[Dave Ramsey]

Why wouldn't you?

[Caller or Guest]

Well, we. I should reframe the question. I have been and it's not working. And I don't know if I should start punishing her, taking away privileges if she. If she doesn't put forth some effort.

[Dave Ramsey]

Does she work? Has she ever had a job?

[Caller or Guest]

She does have a part time job and she is. She's a. She just finished her junior year of early college, so she has done very well. And she will graduate high school with an associate's degree. And she only needs two years to get her undergrad. And she's under the impression that she can start applying during the school year of her senior year and get scholarships. I've done some research and have found that she should really start applying now. And she is not putting forth the effort.

[Dave Ramsey]

Understood. Are you. Are you married?

[Caller or Guest]

Yes.

[Dave Ramsey]

Where's her father in this discussion?

[Caller or Guest]

He agrees with me, but he's also not quite as assertive as I am.

[Dave Ramsey]

Okay. So I think what I would do is gather some information and lay it out, the three of you. And here's the way I would look at it. There was a lady that worked on our team for a while named Christina Ellis. Look her up. Okay. She had a book out called Confessions of a Scholarship Winner. She applied for as a single mom's daughter and received $500,000 worth.

[Caller or Guest]

Oh, wow.

[Dave Ramsey]

And so she can. And she's like the best I've ever met in the world. She worked on this team For a while here and sweet girl too. Very smart, very smart. And she ended up getting a graduate degree from Vanderbilt all paid for. And so yeah, I would gather the information she's got in that book and here's the types of examples that she brought out. And I've heard her teach this from stage with me. Okay. You know, if you spent 200 hours applying for scholarships, that's a lot. That's five hours a day for a lot for 50 days.

[Jade Washall]

Yeah.

[Dave Ramsey]

Part time job, like that's your part time job. And if you got $50,000 worth of scholarship relationships, that means that your daughter doing that would have earned $250 an hour. I'm going to present that type of information to your daughter and to your husband and then say based on that, I don't care if you like it, you're not leaving the house again until you agree to do this crap.

[Jade Washall]

It's more important for her to do that financially than have the part time job, the other part time job, or

[Dave Ramsey]

go to part time college and be ahead of school, you know, so I mean you cannot earn $250 an hour as a 17 year old anywhere else. And that's the rate. I made that number up, by the way. Okay. I mean I don't know if that would work exactly that way, but that's the type of thing that Christina's. The way her mind worked about this was you look at it and you're being paid what an attorney makes

[Jade Washall]

to

[Dave Ramsey]

apply for scholarships, only you're not getting them today. And so if you go to, if you get $50,000 in scholarships and your mom and dad have $50,000 in savings and you're going to get that savings in your pocket when you graduate as a result of having not spent it because you got scholarships, that's making $250 an hour.

[Caller or Guest]

Wonderful point.

[Dave Ramsey]

Yeah. And so, and that changes it, like I'm on your side. I want you to come out of college with $50,000 in cash in your pocket from your dad's and I account that we're gonna hand to you because we didn't have to pay for college because you do this smart thing and she's obviously a talented student and I, she is.

[Jade Washall]

I gotta believe. AI, it's easier than ever to synthesize your ideas and help, you know, prepare your thoughts for the different essays and prepare, you know, what you should write to the essays.

[Dave Ramsey]

You can write hundreds of essays in 20 minutes.

[Jade Washall]

Yeah.

[Dave Ramsey]

With chat GPT.

[Caller or Guest]

Yeah. I have been doing all the research and presenting it to her and telling her to get a bio essay and to chart out a schedule.

[Dave Ramsey]

Yeah, but you're telling her what to do without her really grasping the why. And what I'm doing is walking around the other side and putting a big old carrot out there before I pull the stick out.

[Caller or Guest]

Okay.

[Dave Ramsey]

I want to. She hadn't been seeing the carrot because she's not dumb. This is a bright child.

[Caller or Guest]

Yeah, she's not dumb.

[Dave Ramsey]

And by the way, she's not even lazy.

[Caller or Guest]

She's not lazy.

[Dave Ramsey]

Okay, so she's not got.

[Caller or Guest]

That's why we're so shocked.

[Dave Ramsey]

Yeah, she's not got character flaws. She just hasn't become a believer that this is worth the effort. And we've just got to help you present that to her and her dad and go. Okay, now are you ready to. Okay, let's put together a schedule. And you're going to spend three hours every morning doing this until you reach 250 hours, because it's going to pay you an average of whatever. Okay. The amount that you get divided by 200 hours. And when you finish 200 hours, I will shut up. If you've applied. If you've applied 200 hours worth of effort writing essays to get scholarships, you're gonna get so stinking many scholarships. And by the way, get good at it. Don't just mail it in. Make it worth it, literally. Yeah, but I mean, work the thing. Because Christina said I'm a single mom's daughter and I'm a citizen student and I'm this. You know, you have to use whatever your advantages are. You know, I'm 1 16th Cherokee. I don't care what you are. Whatever it is, you lean into that and you. Because you're going to find somebody that's got everything. I mean, there's. There's all these little nuances, Scholarships and everything. Scholarships. And, you know, it doesn't all depend on athletic ability or grades. There's lots of them that come from all kinds of weird, nuanced things. Things. And so. Yeah. And you know, get creative with the essay. Be the most positive thing that they see coming in front of them and they want to give it to them. Pretend like you're on the scholarship committee. What would you want to see if you wrote the essay coming in? What kind of essays are going to make the difference and that you're going to keep at the top of the stack and all that kind of stuff. And treat this like it's. Like it's a straight commission job because it basically Is. Yeah. And, and. But I think we need to get a big carrot out here. A big. This is, this is the prize. And so the effort is worth it to get the prize. And then, then applying for scholarships makes a lot of sense. But, yeah, I think you're the only one jazzed up about it in your whole house. So we need to get the rest of the house on jazzed. And the way we get jazzed, as we talk about the why not the how, that's the thing. Mike is on the line in Milwaukee. Hey, Mike, we're. What's up?

[Caller or Guest]

Hi, Dave. How are you?

[Dave Ramsey]

Better than I deserve. How can I help?

[Caller or Guest]

So the question is, me and my fiance are looking into trying to be able to put ourselves in a position to retire around the 55 mark.

[Dave Ramsey]

How old are you?

[Caller or Guest]

Just wondering where. 35.

[Dave Ramsey]

Okay. When are you getting married?

[Caller or Guest]

September.

[Dave Ramsey]

Oh, good. Cool, cool. Okay, so you got 20 years to get ready to retire at 55 instead of 59 and a half. So you can't access your rent roths or your 401ks, right?

[Caller or Guest]

Yep. And that's what I'm looking for is what it should be invested in to carry from 55 to 59 and a half.

[Dave Ramsey]

Okay, if. If we were going to guess, let's just put a wet finger in the air. What will you need to live per year when you're 55 if you don't work?

[Caller or Guest]

If I had to guess, maybe 60, $70,000 is to be comfortably comfortable.

[Dave Ramsey]

All right, let's just call it 60. And you need to do that times five. So you need 300K.

[Caller or Guest]

Yep.

[Dave Ramsey]

Yeah. If you don't work, why would you not work at all at 55? Why wouldn't you find something to do

[Caller or Guest]

just to have the option to do it?

[Jade Washall]

Work optional. Work optional is probably a better way to say it. Work optional.

[Dave Ramsey]

Yeah, well, work optional is fine, but it's not. Doesn't happen very, very often. So what I would do is just go ahead and get out of debt, get your house paid off, and build wealth and worry about that when you get a little closer. If you want to invest when you get a little closer, you just do that in a low turnover mutual fund like an S&P 500, like a Vanguard S&P 500 or something like that. And that's a good way to do it. But I wouldn't fool with that today. First you need to work the baby steps and get to baby step seven before you even start talking about this. You spend hours researching before making a major purchase, like a Home or car. But it's also a good idea to put in the work. Searching for the right insurance coverage to protect your biggest assets, I recommend using Ramsey Trusted pros. Whether you're looking for car, home or any other type of insurance, Ramsey Trusted providers have been coached and vetted to serve you like we would find what you [e-mail] insurance. Our scripture of the day. Proverbs 12:24. Diligent hands will rule, but laziness ends in forced labor. Warren Buffett rule number one, never lose money. Rule number two, never forget rule number one.

[Jade Washall]

Got it.

[Dave Ramsey]

Works for me.

[Jade Washall]

Check.

[Dave Ramsey]

John is in Minneapolis. Hey John, how you are? How are you?

[Caller or Guest]

I'm good. Hey guys, thank you for taking my call.

[Dave Ramsey]

Sure.

[Caller or Guest]

So I'm trying to figure out if I'm losing my mind from wanting to walk away from a high paying job and start all over and something new that pays quite a bit less, at least a start. So I'm in a financial sales position right now. It's almost all commission, so I average around 250,000 a year. And I know I'm blessed to be in a financial position I'm in. But for the last couple of years I found zero fulfillment in this job and been pretty unhappy. The culture is very much like work first, family second. And there's not a whole lot of job security. We're really pushed to work past the schedule hours, work every single weekend. And it's really starting to affect my relationships outside of work. What do you have a lot of a financial product? A mortgage.

[Dave Ramsey]

Okay, so you're a mortgage underwriter.

[Caller or Guest]

Office.

[Dave Ramsey]

Okay. A loan officer. Yeah.

[Jade Washall]

Okay, so is it the work or is it the conditions in which you're doing the work?

[Dave Ramsey]

Why can't you do that somewhere else that has reasonable culture and reasonable hours and makes a little less. And it's actually not the actual day to day work. It's the environment and the hours and the lack of and the bad priorities that's driving you crazy, right?

[Caller or Guest]

Yes. And I've had quite a few workers or co workers that have left and went to other companies in the industry and ultimately pretty much every one of them comes back to the company we're at because they said this is really the best company in terms of technology and stuff. But the culture has been like this and has really gotten worse over the last, I would say 12 months. And what I'm worried about mainly is over the next couple years I want to be in a position where I'm starting a family and I look at my coworkers, and I see them really struggling to keep up in the job and, you know, be there, be present for their families. And I just don't want to end up being the parent or again, again,

[Dave Ramsey]

I am not buying the fact that you can make $250,000 at one company and you can't work normal hours and work for good people and have a better balance to what you're doing at a different company and make 150 to 200 at a different company. I don't believe that. I think your co workers have given you a message that's not true. As if there's one place on the planet that this whole thing can happen and it works, and everywhere else it doesn't work. Bull crap.

[Caller or Guest]

Correct. Yeah. And that's the, that's really the feeling that, you know, we get from leadership.

[Dave Ramsey]

I don't care what leadership told you. You don't, you already don't have faith in leadership. Why are you listening to anything?

[Jade Washall]

So what, what, what opportunities have you been looking at?

[Caller or Guest]

Yeah, so we have a family friend who's an electrician in our area and he's been trying to get me to, to be an apprentice for quite a while now.

[Dave Ramsey]

Why?

[Jade Washall]

That's so. A completely different path.

[Dave Ramsey]

Why? Because this one company that you work for sucks and so now you're going to go be an electrician.

[Caller or Guest]

He doesn't know anything about my, my

[Dave Ramsey]

job, so why would you even ask?

[Jade Washall]

Yeah, we're talking about you.

[Dave Ramsey]

I mean, okay, I'm an electrician and I know a guy that is a mortgage guy who's obviously making a lot of money. Maybe, I don't know, it's a quarter million dollars a year. Why would I even talk to that guy about being an electrician? That's just strange.

[Caller or Guest]

Yeah. He knows I've always been interested in working with my hands, and I ended up just kind of falling into this job through an internship in college. And it was always supposed to be, you know, I'll do this for a couple years and then move on to something else.

[Jade Washall]

How old are you?

[Caller or Guest]

I'm 29.

[Jade Washall]

And how long have you been doing the mortgage broker deal?

[Caller or Guest]

About eight years.

[Jade Washall]

Eight years. Okay, so you're looking at this going, man, I fell into this job. This is not what I intended to do. This is not what I set out to do. I need to stop this train and I need to get on the path that I really want to be on.

[Caller or Guest]

Correct.

[Jade Washall]

Understood. Okay. How are you doing financially?

[Caller or Guest]

I'm good. So I have in my Checking account. I have about 15,000. I do have an emergency fund with about 25,000 in it and a high yield savings, no debt at all. I'm very, very fortunate there. And then I have a high yield savings with about 115 that was supposed to be for hopefully a wedding here in the next year or two and a down payment on a house and that sort of stuff.

[Jade Washall]

Okay, so you're getting married in the next year. Any kids?

[Caller or Guest]

No.

[Jade Washall]

Okay, listen, I do think that you should do work that matters to you, work that you feel good about. It's all about how can we get there and is there a way that over time we can create the same value? Because the hard part for me is to know that you were worth $250,000 in the marketplace and then to go down without the horizon of being able to meet that, that peak again, that would bother me personally. If it doesn't bother you, that's okay. So tell us about the electrician. What's the route, what does it look like and what do you want to know from us?

[Caller or Guest]

No problem. So it would be a five year apprenticeship. It would be a union electrician. So I'd start at about $21 an hour in five years. When I make it through, I'd be a journeyman. Right now the pay is about $42 an hour. But that would just be my base pay. Doesn't include like any fringe benefits or top of that, like health insurance money going into a retirement account. When I do the math, working the same amount of hours I'm working right now, which is 55 to 60 a week.

[Dave Ramsey]

You don't want to work that many hours.

[Jade Washall]

So we can't compare it to that.

[Caller or Guest]

Correct. You're right. So it would be a pay cut at the five year mark. If I make it through the apprenticeship, I'd be sitting around about 130 a year.

[Jade Washall]

Year as a journeyman. And that's kind of the peak, correct?

[Caller or Guest]

Yep. Unless I would move up to be a foreman and so on.

[Dave Ramsey]

You really hate this company.

[Jade Washall]

I think so too.

[Dave Ramsey]

This is like they have wounded you so badly that you're willing to jump into a pit of acid to get away from them.

[Jade Washall]

Yeah. How do you know that you'll love being an electrician to the tune of a hundred thousand dollar pay cut

[Caller or Guest]

that I don't know for sure. And that's what scares me the most and why I called in to get your guys advice on this.

[Dave Ramsey]

I know, I'm not buying. I think you're running so hard away from something that you're not looking carefully at what you're running to. So if I were going to advise a 29 year old who made $250,000 a year, who's in a toxic culture and he knows how to sell. I, I'm not against the trades. I'm a fan of the trades.

[Caller or Guest]

Okay.

[Dave Ramsey]

But you have painted the best possible scenario for a union journeyman electrician and it's going to take you five freaking years to get back to half of your income.

[Jade Washall]

Yeah. Could you not.

[Dave Ramsey]

And that just not. That's just not logical.

[Jade Washall]

Could you not go to another mortgage firm first and test that out and go, okay, like this is good. Because Dave's right. You're clearly good at what you do. And generally I think you could make

[Dave Ramsey]

160, 180,000 day one somewhere else, working normal hours and not being spit on every day or whatever's happening over there

[Jade Washall]

and then see how you feel.

[Dave Ramsey]

You've got to get away from the place. I'm not disagreeing with that. But I think you've convoluted the career field as being horrible with the company as being horrible. And you need to separate those two things first before you make this decision.

[Jade Washall]

It's hard to me when. And you'll probably be able to put better words to this, but when you're clearly really good at something and you're clearly very gifted at it, it's hard to then say, but you're not gonna do that. You're gonna go to this. Do you know what I mean? You've got that talent and that gifting for some reason. I don't know. It's hard to walk the.

[Dave Ramsey]

Yeah. You know, again, this smells like an escape.

[Jade Washall]

Yeah.

[Dave Ramsey]

Rather than a journey.

[Jade Washall]

Yes.

[Dave Ramsey]

And. And I don't. I just. It just doesn't smell right. And so you. You ask our opinions or. And we've given a whole three minutes of thought to your whole life. Okay. So it's not really fair to you.

[Jade Washall]

But he doesn't have to choose between this and that. There are some other routes he can go through before he.

[Dave Ramsey]

I think it's a false dichotomy that the only way to be happy is to completely leave.

[Jade Washall]

Yeah.

[Dave Ramsey]

Everything that you're.

[Jade Washall]

Yeah.

[Dave Ramsey]

I would start by leaving the company that you're in and then see where that takes us first. And then I would decide from there. And then is there another way that I can do electrician and own a company that is electricians and so forth that puts us out of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily walk with the Prince of Peace, Christ Jesus.