Push Through Your Financial Setbacks—Don’t Surrender to Them

Summary

Podcast Summary: The Ramsey Show – "Push Through Your Financial Setbacks—Don’t Surrender to Them"

Episode Overview Released on July 1, 2025, The Ramsey Show hosted by the Ramsey Network continues its mission to help listeners build wealth, pursue fulfilling work, and cultivate strong relationships. In this episode, hosts George Camel and Rachel Cruz engage with multiple callers facing diverse financial challenges, offering practical advice aligned with Dave Ramsey’s proven financial principles.

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Caller 1: Zach from Salt Lake City

Timestamp: 00:48 – 09:04

Issue:
Zach and his wife are struggling with significant debt totaling approximately $400,000, including their mortgage. Despite attempts to adhere to a budget using the EveryDollar app, they consistently overspend, leading to stagnation in debt reduction. Money-related stress has strained their 10-year marriage and led to counseling.

Discussion & Advice:
George and Rachel identify a lack of financial alignment and mutual understanding as key issues. They suggest setting up financial "guardrails" to help Zach and his wife stay on track, such as removing easy access to credit cards and implementing stricter budgeting measures. The hosts emphasize the importance of addressing underlying emotional spending habits and recommend ongoing counseling to resolve deeper issues affecting their financial decisions.

Notable Quote:
Rachel Cruz: "I look at it and I'm like, did we really need this?" [02:49]

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Caller 2: Kari from Fort Worth, Texas

Timestamp: 10:32 – 12:45

Issue:
Kari and her husband are facing challenges in saving for the future due to medical issues that prevent her from working full-time. Currently, they hold $30,000 in student loan debt, with her husband earning a gross income of $66,000. They seek guidance on balancing debt repayment and saving for retirement.

Discussion & Advice:
George suggests pausing retirement investments temporarily to focus on debt repayment, as this will free up monthly cash flow to reduce their debt faster. He reassures Kari that once the debt is cleared, they can resume saving and investing with greater financial stability. The hosts advocate for prioritizing debt elimination to alleviate financial stress and create a solid foundation for future wealth building.

Notable Quote:
George Camel: "If you can learn it at 17, you're going to be a multimillionaire by the time you're in your 30s." [59:56]

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Caller 3: Mercedes from Grand Rapids, Michigan

Timestamp: 21:34 – 29:54

Issue:
Mercedes purchased a home in summer 2023, leading to a significant increase in her mortgage payments, now consuming 42% of her take-home pay. Without a fully funded emergency fund, she feels financially insecure and considers selling the house despite not having other debts.

Discussion & Advice:
George advises Mercedes to hold off on selling the house immediately and instead focus on increasing their income and funding an emergency reserve. He emphasizes the importance of a fully funded emergency fund to prevent a mortgage from becoming a financial burden. The hosts recommend giving themselves 6 to 12 months to improve their financial situation before making drastic decisions like selling the home.

Notable Quote:
Mercedes Cruz: "It costs you peace of mind." [09:01]

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Caller 4: Shelby from Dallas, Texas

Timestamp: 32:46 – 38:00

Issue:
Shelby is concerned about her boyfriend’s preference to keep finances entirely separate if they marry, including signing a prenup. She fears this approach could lead to a lack of financial security and emotional disconnect in their future marriage.

Discussion & Advice:
George and Rachel highlight that maintaining separate finances can lead to financial infidelity and resentment, undermining the foundation of a healthy marriage. They encourage Shelby to seek mutual understanding and compromise, advocating for joint accounts or agreed-upon discretionary spending while ensuring transparency and shared financial goals.

Notable Quote:
Rachel Cruz: "The only thing she wants is a joint account." [41:25]

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Caller 5: Taylor from Chicago

Timestamp: 43:42 – 50:25

Issue:
Taylor faces a dire financial situation where her son’s inpatient schizophrenia treatment costs approximately $60,000 within 60-90 days. Additionally, she is burdened with back taxes and is struggling with both rent and mortgage payments due to a failed sublease agreement.

Discussion & Advice:
George advises Taylor to sell her house to cover medical expenses, emphasizing the urgency to resolve the housing payments to prevent further financial decline. He suggests consulting a credit union for a personal loan to bridge the funding gap and underscores the importance of prioritizing her son's medical care while stabilizing her housing situation.

Notable Quote:
Taylor Cruz: "I get up half the night just going over all. Everything was bothering me." [12:07]

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Caller 6: Wendy from Boise

Timestamp: 70:21 – 75:14

Issue:
Wendy and her entrepreneurial husband have accumulated $14,000 in debt over the past two years while aggressively investing $4,000 monthly. With their businesses experiencing seasonal income fluctuations, they contemplate whether to continue investing or prioritize debt repayment.

Discussion & Advice:
George recommends temporarily halting investments to focus on debt elimination, suggesting that dedicating all available funds to paying off debt could clear it within nine months. He reassures Wendy that pausing investments will have minimal long-term impact and will significantly reduce financial stress, allowing them to resume investing once debt-free.

Notable Quote:
Wendy Cruz: "We've never carried debt before, but we have it now." [70:47]

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Caller 7: John from Reno, Nevada (via Rachel Cruz)

Timestamp: 96:22 – 105:43

Issue:
John calls in seeking advice after co-signing a car loan for his brother-in-law, Frank. Frank defaulted on the payments and is now facing repossession, leaving John with an escalating debt burden and damaged relations.

Discussion & Advice:
George and Rachel emphatically advise against co-signing for others, highlighting the severe financial and relational consequences when the borrower defaults. They recommend selling the overvalued vehicle to minimize losses and pursuing a personal loan from a credit union to cover the remaining debt. The hosts stress the importance of maintaining financial boundaries to prevent future financial disasters.

Notable Quote:
Rachel Cruz: "Never co-sign." [83:43]

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Caller 8: Tim from Jamestown, New York

Timestamp: 86:20 – 93:17

Issue:
Tim seeks guidance as his mother-in-law wishes to gift up to $18,000 annually from her 401(k) to her children. Tim and his wife are concerned about the implications, especially regarding potential future medical needs due to family history of dementia.

Discussion & Advice:
George advises Tim to assess the total value of his mother-in-law’s 401(k) to ensure that the gifts do not compromise her financial security, especially considering possible future medical expenses. He recommends accepting the gift if it is a manageable portion of her assets and prioritizing discussions to ensure her long-term care is financially supported.

Notable Quote:
Tim Cruz: "We want to take care of her first and foremost." [89:15]

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Key Takeaways

1. Prioritize Debt Elimination: Before advancing into investments or additional financial commitments, securing a debt-free status ensures greater financial stability.
2. Emergency Fund is Crucial: Maintaining a fully funded emergency reserve is essential to navigate unexpected financial setbacks without derailing long-term goals.
3. Transparent Financial Communication: Couples must align their financial goals and strategies through open dialogue to prevent misunderstandings and financial stress.
4. Caution with Co-signing: Co-signing loans can lead to significant financial and relational strains; it is advisable to avoid unless absolutely necessary and with a clear repayment plan.
5. Balanced Financial Planning: Even with substantial income, responsible budgeting and prioritizing financial steps (like paying off high-interest debts before investing) are vital for sustainable wealth building.
6. Navigating Family Financial Dynamics: When dealing with family-initiated financial gifts or obligations, it's important to assess long-term impacts and maintain boundaries to protect one’s financial future.

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Conclusion In this episode, George Camel and Rachel Cruz adeptly navigate a variety of financial dilemmas, providing listeners with actionable advice rooted in the Ramsey philosophy. From managing overwhelming debt and aligning couple’s financial goals to handling complex family financial dynamics, the hosts emphasize discipline, communication, and strategic planning as pillars for overcoming financial setbacks and building enduring wealth.

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Notable Quotes Recap:

• "I look at it and I'm like, did we really need this?" – Rachel Cruz [02:49]
• "If you can learn it at 17, you're going to be a multimillionaire by the time you're in your 30s." – George Camel [59:56]
• "Never co-sign." – Rachel Cruz [83:43]

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Resources Mentioned:

• EveryDollar App: A free budgeting tool recommended for tracking expenses and maintaining financial discipline.
• SimpliSafe: Security system provider featured in advertisements.
• Fairwinds Credit Union: Recommended for banking needs aligned with financial goals.
• Smartvestor Program: Suggested for finding qualified financial advisors.
• Ramsey Trusted Real Estate Agents: For home buying and selling assistance.

For more detailed financial guidance and to explore the topics discussed, visit www.ramseysolutions.com.

Transcript

[George Camel]

Foreign.

[Rachel Cruz]

To you by the EveryDollar app.

[George Camel]

Start budgeting for free today. From the Ramsey Network. It's the Ramsey show where we help people build wealth, do work that they love, and create amazing relationships. I'm George Camel, joined by the best co host a guy could ask for, Rachel Cruz, also my co host on our other show, Smart Money. Happy Hour is joining me and we're taking your calls at 888. 825. 5225. You call us. We'll attempt to give you the right next step for your life and your money. Zach has chosen to do that out in Salt Lake City. What's going on, Zach? Welcome to the Ramsey Show.

[Rachel Cruz]

Hi. Yeah, so I find myself kind of in a little bit of a pickle here. So, long story short, I've been in step two for the past few years now with me and my wife. We're about 400,000 in debt. Between our mortgage and a few other things, the issue comes where I've tried for the past couple years to work with my wife and create a budget that we can stay in. But inevitably every month we're over budget, leading to us not really being able to pay anything down. We kind of stay stagnant as far as the amount of debt that we're in. I mean, we've been to marriage counseling and talk to various people about this, including family and, you know, the counselors themselves.

[George Camel]

What was the reason for the marriage counseling? It wasn't about the budget. There was some. There was other things going on.

[Rachel Cruz]

It sounds like there were some other things at times. We've been married for 10 years. We have four kids. And we've had some ups and downs, but in general, we're, we're pretty good. But money was one of the big things for me. It stresses me out incessantly. Like, I constantly am stressed about money all the time. It's one of the biggest things that we have arguments about, unfortunately.

[Caller]

Okay, so what's causing you guys to go over each month? What are the reasons?

[Rachel Cruz]

Just spending.

[George Camel]

But is your budget unreasonable? Like, are you saying, hey, we're going to spend 200 bucks on groceries, but every month it's 600, where you need to just adjust it to reality? Or do you think, hey, we are just not really even looking at the budget? We're not tracking transactions.

[Rachel Cruz]

I try to track the transactions. I even use the EveryDollar app. I switched over to it from the Mint app actually, when that closed down. But the grocery, miscellaneous clothing budget, that kind of stuff I have two grand set aside for that. And we go over every month, like sometimes by thousands of dollars. And a lot of the purchases, like my wife justifies as necessary because, oh, the kids need this. Oh, we need this. I'm not spending it on myself. I'm spending it on the kids. I'm spending it on the house. I'm spending it on all these things. And I look at it and I'm like, did we really need this? And that. What is. What inevitably ends up in an argument is, well, she don't need these things in my mind, but in her mind we do. And she's not spending it on herself. So, yeah, it's just this. It goes in circles and I just.

[Caller]

Do you guys? Yeah. So what I think the problem is overall is that it sounds like you guys are not on the same page. I mean, you're like, I have every dollar. I'm tracking transactions, I'm stressed about money. I. It's a lot of one sidedness is what it sounds like. And exactly my question to you is, have you both sat down multiple times and said, hey, let's create a budget together or even bigger than that, Zach. Like, hey, here's where we want to go financially. Like, here's where we want our family to be in the next five, 10, 15 years. And we dream together, we have goals together. We are doing that. Are you guys. I'm assuming the answer is no.

[Rachel Cruz]

We have sat down and done that before. We have multiple times. The problem arises that I will mention that this does play a part in it. She does have anxiety and depression on her own that she's getting treatment for. But a lot of times she emotionally spends, or when she's feeling down, she'll go and spend money. And then she justifies it after the fact. But we sat down and said, hey, because we want to move. For example, we want to get into like, we live in a townhome now. We want an actual home eventually, a house that we can, our kids can play in the yard and have fun and grow and whatever. And that's a goal we both have. And we've talked about it like, this is where we want to be in five or 10 years. But the little actions don't lead to anything or they don't lead in that direction. And I talk to her about it. And multiple, like two or three times a month, I sit down like, hey, this is, this isn't good. We're not heading in the right direction. This is where you want to be. This is where we want to be, you know, in five or 10 years, and then it's like that just goes in one year out the other. She agrees in the moment, but then the actions don't.

[Caller]

Don't line up.

[Rachel Cruz]

Line up.

[Caller]

No, I hear you.

[Rachel Cruz]

And then she'll beat herself over it later. Down. I'm so sorry. Whatever. The victim mentality starts to come out, and it gets really hard to have a conversation about it.

[Caller]

Right. Totally. Yeah. So I think the way I would start approaching it, Zach, is less. Here's what you're doing. You're overspending. You're not online with our goals. You're doing, you know, it's. It's a lot of you, you, you to her versus approaching the conversation with. I mean, have you gone to her and just the agony of how much this is stressing you out. Have you been honest with her completely about the weight that you feel like you're carrying and not about her actions, but about what you're feeling?

[Rachel Cruz]

Yes, to the point that I've actually had to seek out counseling for my own anxiety because it stressed my. Myself out. She's encouraged me to go. But, yeah, that doesn't solve the root problem, the fact that we're on our budget every month, and it's. It's a struggle because I thought maybe we just need to, like. I've tried the envelope method with cash, and that doesn't seem to work. I. I don't know. I'm. I've been tempted to just, like, completely separate our finances entirely and just say, hey, here's a card. Once it's used up. We can't. Like a checking. A separate checking account.

[Caller]

Yeah, that's just. I think that's a. Yeah, I hear what you're saying, and I. I get how you will get there, but also, I think that that's. That's a band aid on these bigger issues that's happening within hers, what it's sounding like. And usually I feel like we can kind of play both sides of the aisle.

[George Camel]

Yeah.

[Caller]

On these calls. But from what you're telling us, Zach, is it does sound like there is some. Something within her. Right. That she's finding her security. She's finding a level of medicating through spending is kind of what. Is what it sounds like. But you said that she. And she is struggling with some depression and anxiety. And is she. Is she. Is she an ongoing help for that?

[Rachel Cruz]

Yes, she's been given ongoing help for that. She's been getting counseling for seven, eight years for that.

[George Camel]

The majority of our marriage I think at this point, Zach, we just need to set up guardrails. And the conversation, instead of attacking her, might be, hey, can I help you set up some guardrails so that we can stay on track this month and accomplish our goals. And that might mean, hey, we remove the debit card info, we get rid of Amazon prime, start to figure out where the overspending is happening, and add friction back in with ongoing counseling and ongoing conversations.

[Caller]

Yeah, I think there's bigger things happening, Zach, in your marriage between you guys. And it's coming out as money for sure. But I think the root cause is something much deeper. And so you guys concentrating and working on that, and in the meantime, setting up some of these tactical friction points for her would be helpful. But, yeah, there's some deeper things there for sure, Zach, that I would get to the root of if I were you guys.

[Rachel Cruz]

The bottom line of a break in.

[George Camel]

Is more than financial.

[Rachel Cruz]

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[George Camel]

Kari's up next in Fort Worth, Texas. What's going on, Kari?

[Rachel Cruz]

Hey, guys. Thank you so much for taking my call today. Sure.

[George Camel]

How can we help?

[Rachel Cruz]

Oh, boy. So I have a kind of complex situation, but I'll start with basics. My husband and I only have one remaining debt, but we're kind of lost as to what the next steps are, because I have a lot of medical issues that prevent me from working. I've had a really hard Time finding something I can do from home. And we want to be able to save for our future and start saving, you know, investing in our retirement. And we're just kind of stuck because of the situation that we found ourselves in. So I was really hoping that you guys could kind of give us some guidance about what the next, the right next step would be.

[Caller]

Yeah. What's going on health wise for you?

[Rachel Cruz]

So I was just diagnosed with neuropathy in my legs and my feet about a month ago. I've been dealing with that now for about five months.

[Caller]

So. Sorry.

[Rachel Cruz]

Yeah. And so I had this happen about 15 years ago. I'm 26.

[Caller]

Okay.

[Rachel Cruz]

And my husband's 31. And about 15 years ago, the same thing happens with my eyes, so my optic nerves deteriorated. Wow. So. So I'm legally blind in one. And my, my overall vision is just like very degraded. I tell people it's like watching a black and white movie in color. So I can't drive and it's very difficult for me to stand or walk for long periods of time.

[Caller]

Okay.

[Rachel Cruz]

So I've, I've been looking ever since we got married. We just had our second anniversary last Monday. And I've been looking ever since we got married for something that I could do from home. You know, a side hustle, something part time, even something full time. And I counted last night, I was up, up half the night just going over all. Everything was bothering me and that's why I called today actually. And it was how many? I counted between somewhere between 400 and 450 applications. Between networking online, like things like Indeed and ZipRecruiter and in person things I've tried over the last couple of years. And I've had one interview and they really, really liked me, but I didn't get hired.

[George Camel]

What kind of role was that?

[Rachel Cruz]

So I was a medical receptionist for three years before I had to quit working full time.

[George Camel]

Okay. It sounds like the type of work you'd be able to do from home would require mostly phone. If it's difficult to look, I assume it's difficult to look at screens all day.

[Rachel Cruz]

No, actually I twitch stream right now because I don't know what else to do with my life.

[George Camel]

Oh, wow. So screens are no issue?

[Rachel Cruz]

No, screens are not an issue as long as they have like blue screen protectors and stuff like that.

[George Camel]

Okay.

[Caller]

Have you, have you applied for like personal assistant type roles? Administrative roles, all of that.

[Rachel Cruz]

Administrative assistant, personal, you know, personal assistant, data entry, you name it. I actually even went through a seminar for you guys. Financial Coach, master training. I had to turn that down too, because we couldn't afford it.

[George Camel]

What's left on your debt?

[Rachel Cruz]

So it's just my husband's student loans from college. He has just over 30k left in that.

[George Camel]

And what does he make?

[Rachel Cruz]

66 gross. And after, let me see. Because certain things come out of his pay before we even get his paycheck. So our HSA and his 401k and our medical, dental, vision insurance all come out before his paycheck. So.

[George Camel]

Can I free you? You'll get some money back if he just pauses investing right now.

[Rachel Cruz]

That's true.

[George Camel]

Including the HSA contributions. Do you guys need that to cover medical care?

[Rachel Cruz]

Yes, that's. That's what's paying our medical bills right now is what's going into the hsa because the company matches that.

[George Camel]

Okay, so how much is he investing in the 401k?

[Rachel Cruz]

Oh, I actually don't know. Actually working from home today. Let me see if he knows.

[George Camel]

I'm just saying that number will now be back in your budget every month to help you pay off this debt faster. And is he able to work any overtime or any side hustles?

[Rachel Cruz]

Right now.

[George Camel]

She'S bothered. I love that. He's like, let's get him on the line. This is great. We love this moment.

[Rachel Cruz]

Yeah. Well, he works from home two days a week, so he happens to be home today. He thinks 3%.

[George Camel]

Okay.

[Rachel Cruz]

And then his company matches that 3%. That. Right, hun? Okay, yeah. He's nodding yes with me.

[Caller]

So, Carrie, I think for me, the biggest question I have is all these applications that you have put out into the world. 400 or so. I'm just. I really am a little perplexed as to. Are they. Are they, do you think, more advanced positions than what. What they see you as qualified for? Like, have you gone more entry level? Because, I mean, because we've talked to many people that there's. Okay, yeah, tell us.

[Rachel Cruz]

Yeah, so I only have 25 college hours. I don't have a degree. I went straight into the workforce because I didn't know. I did one year of college. And then we moved. My family moved. We used to live a little further south of the DFW metroplex. And so when we moved up here, I paused my college to help my mom get our house set up.

[George Camel]

But are these jobs requiring a degree in the application?

[Rachel Cruz]

A lot of them are, yes. A lot of. A lot of them.

[Caller]

Those you would just. You couldn't even apply for because you don't qualify, actually.

[Rachel Cruz]

Okay. So I've only been looking at ones that only require a high school diploma.

[George Camel]

What about customer service roles?

[Rachel Cruz]

I've definitely looked into that as well. The only problem is is that right now a lot of customer service positions are requiring you to know. So many companies are trying to pull people back into the office instead of staying at home.

[George Camel]

I have not heard that.

[Rachel Cruz]

As far as customer service here in Texas, it's really, really bad. The other problem is, is that I'm not bilingual and a lot of positions here in the DFW area especially, well.

[Caller]

It may not be a company bilingual. Well, I would be looking outside.

[George Camel]

If it's remote, then companies all over the country would be able to hire you.

[Rachel Cruz]

Right, right. So the only problem is is that a lot of companies require you to live in certain states because they only serve those states. So I've only been able.

[George Camel]

I've not heard this either.

[Rachel Cruz]

Dude. It's been a ride. So I've only been able to look at the ones that say you can live in Texas for this role, which has been about half of the ones I've looked at on average.

[George Camel]

Okay, you're gonna have to continue the search. Get creative. I would be posting on your personal social pages and LinkedIn and reaching out to friends, texting people and asking how.

[Rachel Cruz]

There are specific roles I've been doing for two years. And I know a lot of people in the area. You know, I know a lot of people and with a lot of good connections and they just haven't been able to find me anything because a lot of stuff. What, what I've been told by a couple of different employers that did look at me was basically I'm too qualified for a lot of the entry level things and I'm not qualified enough for anything higher up. I'm in that really weird in between section where no one wants to take a look at me because I'm in between.

[George Camel]

What would it take for you to finish your college hours online for a community college?

[Rachel Cruz]

So we can't afford what that would.

[George Camel]

Cost us right now, I'm saying community college.

[Rachel Cruz]

So we had a local community college that I was going to when I started working. It would for me to take even part time classes. It would take, I want to say, at least 500amonth to do that. And I've applied for like scholarships and stuff and they, they keep telling us I don't qualify for financial aid because we make too much money and I don't qualify for anything but academic scholarships. And generally those range from anywhere to 500 to 1000. They. They might cover like one or two semesters maybe.

[Caller]

Okay, so I mean, I mean, so what we've heard, Carrie, which I understand from a medical standpoint, like you've gone through a lot. Like, it's very. I can only imagine what you're living. You know, it's so difficult. But it does feel like every and every question we asked, there was always a reason of why it's not working. So we need to be shifting our perspective. And I mean, you could go online and be a secret shopper and get paid 20 bucks an hour. Do that. Like have a goal just to make $300 a month, like, right? I mean, like go like very basic. You need a little confidence booster, Carrie, and a little pep in your step that I can do this.

[George Camel]

I can do this because a little persistence of creativity.

[Caller]

Yes. And I understand that it is so hard and so difficult, for sure. But man, I just know, George, we have people on the show and they're 19 years old and they're making $200,000 because they're coders or whatever. It's stuff that you're like, wait, what? So there's things out there, Carrie, and I just want you to have a little bit more of some rose colored glasses and a little bit more confidence as you go into this stuff because there are rules out there and I bet you can find them. Hey, you guys, if you're looking to save big on groceries without sacrificing quality, you've got to check out Aldi.

[George Camel]

That's right, Rachel, because let's be real, I'm bougie, but I'm also frugal.

[Caller]

So you're bougie, George.

[George Camel]

Thank you for admitting it. So why pay more for the same stuff just because it has a fancy label? Aldi shoppers save up to 36% on a typical shopping trip over name brand products at other stores, which adds up to about $4,000 per year for a family of four.

[Caller]

It's crazy. Yeah. And you know what? Their organic produce, their fresh meats, and even their private label, it's all delicious. So it's good quality stuff that's not going to bust the budget.

[George Camel]

And the best part, no membership fees, no gimmicks, no headaches. Just a simple shopping experience with the lowest prices of any national grocery store.

[Caller]

So beautiful. Okay, so stop paying more and start shopping at Aldi. Find a store near you today at Aldi us. That's a L D. I usually.

[George Camel]

Mercedes is up next in Grand Rapids, Michigan. Mercedes, welcome to the show. How can we help?

[Rachel Cruz]

Hello? So back in 2023, summer 2023, my husband and I purchased a home. And I feel like that was like the first moment of like kind of going like more off the Ramsey plan. And so now it's just like the taxes went up a little bit and so it's like 42% of our take home pay.

[Caller]

Oh my gosh.

[Rachel Cruz]

And I know, I know. Luckily we don't have any other debt, you know, so there's that. But yeah, I really want to sell it. I just feel like so stressed and like financially insecure all the time. And I feel like that's what you guys are going to say. So I guess I'm just looking for, for confirmation that I'm not crazy.

[George Camel]

Well, let's look at all the solutions first. Selling a house is one of the biggest financial moves you'll make, aside from buying one. And so I never jumped to that conclusion. And at 42% take home pay, yes, it's bad, but nothing's on fire here. Now you guys don't have any debt, so the question is, are you. Do you have a fully funded emergency fund?

[Rachel Cruz]

No, we don't have that either.

[George Camel]

Okay.

[Rachel Cruz]

We're kind of working on that now.

[George Camel]

How much do you have in savings.

[Rachel Cruz]

Right now? About like eight, eight thousand or so.

[George Camel]

Okay. And how much margin do you have right now aside from all of your bills and insurance? How much money do you have left over.

[Rachel Cruz]

Like to save? Yeah, depending on the month, like in overtime and everything, maybe like a couple hundred to 1,000.

[Caller]

Okay, that's with overtime.

[Rachel Cruz]

Well, yeah, without overtime it's closer to a couple hundred. And like, if we happen to work over time.

[George Camel]

Are you guys doing any investing right now?

[Rachel Cruz]

I think we just both have like our, just our basic 401k match at this point.

[George Camel]

Okay, so you're doing a lot at once and that's okay. But it's not the Ramsey plan. Like you said, you kind of went off the reservation a little bit. And what is your husband think? I'm guessing he's saying, no, we're not going to sell it. That's a crazy idea.

[Rachel Cruz]

Yeah. He thinks that everything's fine, I guess.

[George Camel]

Okay.

[Caller]

He doesn't feel stressed?

[Rachel Cruz]

No.

[George Camel]

So what exactly is stressing you out right now? I don't think it's a percentage number.

[Rachel Cruz]

It's not the percentage number. It's how tight everything feels. It's how much we have to like, think really hard over like a decision. I just feel like we came from a more expensive area. But I feel like here we definitely could have purchased a more affordable house or you know, could have done, done some things differently.

[George Camel]

Yeah.

[Caller]

How much is your, yeah. How much is your payment per month? Your mortgage payment?

[Rachel Cruz]

It's like 2500 around there.

[Caller]

Okay. So yeah, so automatically if you did the 20%, for instance, you would have. Yeah, close to a thousand, A little bit more. Just back in your pocket, 1200 bucks. And you feel like with that, does that give you complete security? Like if you had an extra twelve hundred dollars a month, would you say Mercedes, like, okay, now we don't have to pinch every penny. Like, is that enough for you or do you think. Golly, I think we'd probably need a little bit more even beyond that.

[Rachel Cruz]

I think we could, I think we could be okay with that and like having our emergency fund fully funded, but we'd also get there a lot faster if we had to save. I mean not quite half as much because we have other expenses that might be a little bit more fixed than like mortgage, but like, I mean maybe 30% less at.

[Caller]

Yeah, yeah.

[George Camel]

Okay, here would be my solution. I would give this thing 6 to 12 months to see if we can up our income to where that lowers the amount of take home pay is being eaten up by this mortgage.

[Caller]

And I, and by income, I would say your primary income. Not to work extra, you're not.

[George Camel]

We need sustainability here.

[Caller]

Yeah, yeah. You don't want to be working overtime to try to get this percentage down. But just from your, just your, just your job.

[Rachel Cruz]

That's what we're doing.

[Caller]

So do you see, do you see anything changing in the next 12 months for you guys, job wise that will create some increase in working?

[Rachel Cruz]

Yeah, my husband's been working super hard at his job and like I feel like he's, he's been there for a couple of years since maybe right before we got the house. And I feel like he's starting to get noticed. He had like a promising interview, but it was just an interview, you know, But I mean, I think just he's heading in the right direction. Like he's starting to be like told to apply for roles and so I think maybe there's promise there. He's definitely always like spoken of in high regard at his job and then for me I definitely can keep looking for stuff. I did just like get, I'm getting my resume redone.

[Caller]

Are you working, Mercedes?

[Rachel Cruz]

Yeah, I work too.

[Caller]

Oh, you do work. Okay. Okay, okay. Sorry. Just making sure.

[George Camel]

What are you making?

[Rachel Cruz]

It's okay. I make about like 50,000 before overtime. Like, gross.

[George Camel]

Okay. And he's making what, 75, 85 closer.

[Rachel Cruz]

He's probably like around like 60. Okay. I don't know. Hourly. I'm at like 23 and he's at like 29.

[George Camel]

Okay.

[Rachel Cruz]

So an hour, that helps.

[George Camel]

Yeah. So you guys are making six figures as a couple, but you're at 2500. Yes. It's high, but I don't think this is as on fire as you think it is.

[Caller]

Yeah.

[George Camel]

And so I'm not here to side with your husband. I do think that he should be more concerned. So I think we should meet in the middle and go, hey, we need to develop a plan to get this income up, get this emergency fund funded and means pausing investing for a season. Yes, you'll miss the match, but you're going to have some peace back in your life when you have 15 or 20k sitting in that savings account. And we're getting our income up at the same time so that this 2500 is just a smaller part of our world. Because if you can have your take home pay be, be $10,000. And when we talk about the mortgage parameter, we're saying after taxes, but before other deductions like your health care premiums, your 401k, that will affect your math in a good way. So you may want to recalculate to give yourself some peace right now.

[Rachel Cruz]

Okay.

[Caller]

Yeah.

[Rachel Cruz]

Yeah. And I don't want to rag on my husband. He has always been, we need to get better jobs. We need to make more money, you know.

[Caller]

Yeah. And I think, and I think I see that as the solution of, in a realistic one too. I think you guys can, can get better paying jobs. I mean, honestly, I think whether it's through raises and moving up within the companies, but I do see a track for you guys that you probably will be making more, which will lower that percentage. Let's head to 20. I'm into 25 earlier, but yeah, I'm George, it's not, it's not on fire right now, but you also don't want to live like this for the next five years of your life either. So something, something starts, something needs to be giving given, you know, in the next, yes. Six to, six to 12 months. And that I think that'll give you some hope and some peace for sure. But I get it. And, and it's hard too when you're, you know, you're making, you know, good money. I mean, that's, that's great. I mean, you guys are at like 110,000 a year. And, and it's frustrating when you feel like I still have to pinch pennies and still think through things that should just be automatic and they're not. So there's a reality to two life in numbers that I feel like is always kind of a hard pill to swallow, but it is, that's the reality of it. So I don't think that that's not, that's not going to go away, you know, forever. I feel like regardless of your income, you're, you need to be thinking through purchases and you may not have the stress on it, but that doesn't completely go away.

[George Camel]

And we talk a lot about how we want homeownership to be a blessing and not a burden. And this is what we're talking about. If you don't have an emergency fund and you jump home ownership and you're going, well, it's better than renting. I don't want to throw money away on rent. This is where you can end up with too much of your take home pay being eaten up by this mortgage on top of repairs and maintenance and increasing property taxes and insurance. And that can leave people in a real bind. And so what that means is we might have to pause. We might need to buy a home in a different neighborhood. We might need to get a townhome for now instead of the single family home, save up a bigger down payment. And so I don't like for anyone to rush into home ownership thinking it's going to solve their problems. It will only create more problems. And I say that as someone who loves home ownership. I think everyone should be a homeowner at some point in their life and the earlier the better. But there's a right time to do it and that's when you're out of all consumer debt, which our friend Mercedes was good on her fully funded emergency fund, that's three to six months of expenses and a healthy down payment where you can cover closing costs out of pocket on top of that. And so that's a difficult place to be. I'm not trying to make it sound easy, but it requires a higher income than it did five years ago to be a homeowner.

[Caller]

Right. Well, and she said it earlier, and I think this is, this can be the attitude sometimes when you go into homeownership, especially your first home. She's like, we, looking back hindsight, we probably could have, you know, probably bought something a little bit smaller or something, you know, I mean, like she made the comment of like, we probably could have and what's difficult is when you go to the bank to pull your.

[George Camel]

Loan, they will lend you monopoly money.

[Caller]

They will give you so much and you think, what? Oh my gosh, thank you for believing in me, Bank. Unbelievable. Bank. I'm so great. I'm so good at this. And then you take all that money that they're going to loan you and go get a house off that. And no, you need your own parameters. And the Ramsey way is more conservative with homeownership. Our numbers are, but it's so that you have more margin to do other things like giving and investing and all of this and living life. So you're not having to think twice about all these, like, small purchases that feel like it should be a given. So remember, just because the bank is going to offer you a certain loan amount, don't suddenly get like stars in your eyes thinking, oh my gosh, this is what we can do.

[George Camel]

Way more houses than we thought. Thanks, bank.

[Caller]

Yes.

[George Camel]

No, thank you. Most phone plans are like bad roommates, unpredictable, always asking for money, hard to get rid of, and they never do the dishes. But Boost Mobile, totally different story. It's just 25 bucks a month for unlimited talk text and data. No contracts and no weird hidden charges. Just 25 bucks a month? Forever. That's right. The $25 price will never go up. And if you're still skeptical, I get it. That's why Boost mobile offers a 30 day money back guarantee. So try Boost, you'll love it. Or get your money back. Go to boostmobile.com Ramsey to make the switch today. That's boostmobile.com Ramsey restrictions apply. See boostmobile.com Ramsey for details. Buying or selling your home is a big deal and you want an expert in your corner fighting for you to find the best deal for the right price. And the Ramsey trusted program is the only way to find a top agent you can trust who will help make your home a blessing, not a burden. It's easy. You compare agent profiles, interview them, choose the one you want to work with, find a local Ramsey trusted real estate pro for [e-mail] agent or click the link in the description if you're listening on YouTube or podcast. All right, Shelby is in Dallas, Texas. Up next, what's going on? Shelby, hi.

[Rachel Cruz]

I was just wondering. I've been dating my boyfriend for about a year now and we're starting to talk about marriage. He's Australian and basically we were talking about finances and he would want to keep them like completely separate. He earns like a little over Double what I earn. He just bought his first house as well, and it concerns me. He also mentioned maybe wanting me to sign a prenup. And I just feel not secure maybe marrying and having kids with somebody who feels, you know, finances should be 100% separate. So I was kind of wondering what your thoughts were, if you had any advice for me on this topic, basically, moving forward.

[Caller]

Yeah. Did he give you reasons why he wants to keep it separate? Is it because of the amount he earns? Is it something that happens and his past, his parents, like, did he give you reasons why?

[Rachel Cruz]

Yeah, pretty vague. His parents did get divorced, but on fairly good terms. I think the income disparity is a bit of an issue for him, which I don't not understand. But I think mainly he just wants to feel that he's in control of the money that he's. He's earned. We were talking about it last night, actually, and he was saying, well, I don't believe that it would be our. Our money, you know, if we were married. What I earn is like my money.

[George Camel]

So it'd be his house, his money, and you just get the privilege of living there at a discounted rate. Is that what this future looks like?

[Rachel Cruz]

Basically. I don't think he sees it that way, but, yeah, that's kind of.

[George Camel]

That's what he's saying. It sounds like he wants to be single.

[Caller]

No, he wants.

[George Camel]

No, he wants the benefits of the relationship. He loves her, but he doesn't want the commitment of a relationship.

[Caller]

Commitments from a financial standpoint. And. Which means. Is an indicator. What you're getting at, George. An indicator of. I want to keep parts of myself to me and you keep you over there. And I want it nice and tidy. And I want to enter into a lifelong relationship with you, which is not realistic. Like this tidiness and this. Like, I'm here, you're there, and this feels good. Like, no, you guys are about to share a bed, you're going to have kids and share genetics that are running around in front of you like you're sharing every other part of your life.

[George Camel]

And yet you have to Venmo him for Outback Steakhouse.

[Rachel Cruz]

That's what it sounds like. Yeah. Because I was saying, well, maybe we could have a joint account and agree upon a percentage of our checks that we put into separate discretionary spending.

[Caller]

Yep. So. So the red. The red flag, to me, the big overarching is that if you want to keep yourself from me, and you are financially, when he's living like this, there's going to be other parts of our marriage that are going to be in that exact same formula. Because that's your mindset. You can't go into a marriage and say, I want this part for me, this part for you. Kids. Yeah, sure, we'll share together calendars. No, I'll go do my thing. You do. Like, you can't live your life like that in a marriage. Well, you can't live your life like that in a, I would say a healthy, well connected marriage. Because the healthiest marriages that we see are ones that people say I do to you for the rest of my life. And I see it as a covenant. I see it as something bigger than me. And we're entering into this and every part of part of our lives, we're combining. And that doesn't mean that you're not still Shelby and he's not still him. And he, you know, he has his quirks with money and you know, he loves to budget. And you don't, like, there's still going to be opposites. You're still going to have your natural tendencies. But to say that I'm going to block you from a part of me to keep me in control over here, that. That's saying a lot about someone. It really is. And a lot of people disagree with this advice. If you called another money show, yeah, they probably wouldn't be as bothered as we are. But we see this as a reflection of the person, more so than just the reflection of the bank account.

[George Camel]

And I've rarely seen a thriving marriage with total unity and love long term that lives this way. It's just too hard because what it turns into resentment and scorekeeping of, well, I covered this bill last time and, well, I make half as much, so I should only cover half as much of the bills. It just becomes tit for tat. And that's just not a way to live your life. Entering into this.

[Caller]

It's a business relationship, not a romantic. You know what I mean? Not a partnership.

[George Camel]

And it causes financial infidelity down the line because you have no say or transparency into what he's doing with money. He could have a spending addiction that you're totally unaware of because you don't see the account. You don't have access to the account. And so I'm not saying this relationship shouldn't continue, but I do think we need to. We need to find some consensus and unity here in alignment in what our future looks like. And I don't think he's a bad guy. I think this is just all he knows. And I think, truthfully, at the heart of this is fear. And so getting to the root of that fear and overcoming it over time with lots of conversations, maybe some counseling, and realizing that one day you might not have an income at all. What if you stay home with the kids? What happens then? Do you get an allowance?

[Rachel Cruz]

He said in that case, he. He'd be willing to reconsider and combine things for. For that amount of time. But I just. The whole thing makes me feel, like, gross. Not safe.

[Caller]

Yes. Yes.

[George Camel]

No, I. I would charge him rent for the nine months that that baby is housed inside of you to go.

[Rachel Cruz]

Well, yeah, right.

[George Camel]

Thousand bucks a month. Nine months. That's nine grand you owe me.

[Caller]

Is he bringing in a lot of money? Like, does he have, like, millions of dollars in. In an account that he's bringing in?

[Rachel Cruz]

No. The issue is just really that I'm not earning enough right now. I'm making about 30, which is not good. And he's making about 85, and he works.

[Caller]

All right, hold on. Can we.

[George Camel]

I thought this guy was, like, a multimillionaire.

[Caller]

Shelby. I thought he was making. Making like four. I thought he was a surgeon. I thought he was making half a million to 600. And you're like, I'm making 150. I don't know. He's making $85,000. I'm sorry. Get off your high horse. I can't. Oh, I can't.

[George Camel]

Is this.

[Caller]

I can't.

[George Camel]

Listen, it takes a lot to tick off Rachel, and he done ticked her off.

[Caller]

Well, I'm like, I'm sorry your little ego is so inflated at 85. Like, 85 is great. Listen, it's great.

[George Camel]

Hey, babe, let me handle it. I'm the breadwinner here. You know what?

[Caller]

Making six figures, dude, what happens if.

[George Camel]

You make more than him? Then do you get control of the board?

[Rachel Cruz]

That's been a lot of my issue because I've told him, you know, if you. If this is how he entered a marriage at some point because of some other circumstances I could see, maybe in the future, I may earn more. His job is very physical. If he loses it, that's kind of. It's a big. It's going to be an issue. And if I do earn more later on and you have an issue, I'm going to feel like, well, I hope you figure it out, because that's how you treated me, and that's not the mindset I want to go.

[Caller]

Either way, the relationship is ruined, and you're already going into scorekeeping like, even that scenario, you're not even married yet. You know what I mean? So, like, it's.

[Rachel Cruz]

Yeah.

[Caller]

So. Yeah, Shelby, I. And again, I don't want to paint him like he's a bad guy. I think you're right, George. I think it's just all he knows, it's all he's aware of. But, I mean, that gets down to a deal breaker for me because I just can't. I can't even imagine. I can't imagine Winston Key. Like, I couldn't imagine playing that through.

[George Camel]

Yeah.

[Caller]

In a scenario.

[George Camel]

I know more this month. So I get control of the board for this.

[Caller]

Because I'll be honest with prenups and stuff. I mean, Shelby, I've. Even from my own just personal opinion, I've gotten even more lenient with those. I used to be so anti them, but I. We've seen so many situations, you know, and that's why I asked. Is he bringing in a lot? Like, you know, I mean, I've had friends. I've gotten screwed with stuff. Like, I mean, just. I get it. I get that there's a lot of pain, and there's parts of like, hey, let's. I want to be wise about this because I. You know, I get it. I can have a conversation around that, but not at 85 with. Not, like, something really big that you're bringing in. Like, to me, I don't know if it's ego, fear, George, is maybe what it is. I don't know. But I. Yeah, that's just. It just doesn't set you up.

[George Camel]

Well, Shelby, what I wouldn't do is just look right past it and go, oh, well, maybe it'll solve itself once we're married.

[Caller]

Yeah. And you're not. Cause your gut's telling you something. Shelby, you said that. You're like. It makes me feel like, ugh. Because it is, you know.

[Rachel Cruz]

Yeah.

[Caller]

It's not like Jeff Bezos, you know, he got married.

[Rachel Cruz]

Sure.

[Caller]

Sign a prenup.

[George Camel]

Sure.

[Caller]

I'm sure there was a prenup for Jeff, you know, but I don't know. Yeah. Shelby, I'm sorry. If you love him, keep pressing in on it. I mean, you know, let this be a. A good kind of litmus test to the relationship and how much your opinion matters, and if you.

[Rachel Cruz]

You.

[Caller]

And if he values your opinion enough to learn from you even. Right. Is there that humility there? So let this kind of be a litmus test of you guys talking through it. But that. That would be hard.

[George Camel]

And, guys, take note. All she Wants is a joint account. Okay, it's not that hard. We could all be married and happy by now instead of just closing our fists and going, it's mine. All the jewels are mine. It's no way to. Let's be honest.

[Rachel Cruz]

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[George Camel]

They work for themselves.

[Rachel Cruz]

Meaning they love it when you overpay. So you need a guide on your team to help you make the best choices. Health Trust Financial works for you. They're not salespeople. They help you find the health insurance option that makes sense and saves you money. The fact is, health insurance is one of the biggest expenses in your budget. But most people who work with Health Trust Financial end up saving $500 a month. Imagine putting that kind of money toward the baby steps. My team has worked with them for over 20 years and they've served thousands of people just like you. They're the only health insurance broker that's Ramsey trusted to help you. So stop throwing money away and get the health insurance that's right for [e-mail] that's healthtrustfinancial.com foreign.

[George Camel]

From the Ramsey Network. This is the Ramsey show where we help people build wealth, do work that they love, and create amazing relationships. I'm Ramsey personality George Camel, joined by my co host Rachel Cruz, bestselling author and host of the Rachel Cruze Show. We're taking Your calls at 888, 825-5225 and Taylor's up first in Chicago. What's going on? Taylor, Hi.

[Rachel Cruz]

How are you?

[George Camel]

Great. How are you?

[Rachel Cruz]

Oh, I'm good. So my question is, should I sell my house or borrow against it for my child's medical needs?

[George Camel]

Is there option C.

[Caller]

For me?

[Rachel Cruz]

No.

[George Camel]

Okay, walk us through this. What are the medical needs and what will it cost?

[Rachel Cruz]

Well, my son has some mental health issues and it will cost for quality health care. Mental health care. I'm around $68,000.

[George Camel]

How much?

[Rachel Cruz]

60.

[George Camel]

$60,000. And over what course of time?

[Rachel Cruz]

60 to 90 days.

[Caller]

Wow. Is it a treatment facility? What's.

[Rachel Cruz]

Yes.

[Caller]

Okay.

[Rachel Cruz]

Yes, a treatment facility.

[Caller]

Okay. Is it addiction type or it is suicidal?

[Rachel Cruz]

Schizophrenia.

[George Camel]

Schizophrenia.

[Caller]

Okay, okay, okay.

[George Camel]

Oh, I'm so sorry.

[Caller]

You're dealing with this Taylor. How old is he?

[Rachel Cruz]

He's 22.

[Caller]

22.

[George Camel]

22.

[Caller]

Does he live with you?

[Rachel Cruz]

Yes.

[Caller]

Okay. And is this an outpatient type facility that you're looking into?

[Rachel Cruz]

No, it's inpatient.

[Caller]

Inpatient. Okay. And how was this place recommended to you through like one of his maybe therapists or psychiatrists?

[Rachel Cruz]

No, nothing has been recommended to me. It's just all research I've done on my own.

[Caller]

Okay, and is he in medical. Under the care of a medical professional right now?

[Rachel Cruz]

Up until a couple months ago, he was. He was on state funded medical insurance, but they cut him off a couple months ago.

[George Camel]

Okay, why was that?

[Rachel Cruz]

Because of. They said I made too much money.

[George Camel]

How much do you make?

[Rachel Cruz]

$19 an hour.

[George Camel]

And that's too much money for state funded care? You're not at the poverty line essentially in Illinois.

[Rachel Cruz]

In Illinois, yes.

[George Camel]

What other debts do you have?

[Rachel Cruz]

Well, I owe back taxes for last year. I hired one of those tax attorneys to delete the debt. However, it was just put on hold. So taxes for last year and then I didn't file this year because I don't receive like, I pay every. I don't receive like any food stamps or anything like that besides receiving the medical. But. So the only way for me to maintain my bills and food was to file all my exemptions. So at the end of the year, I end up owing taxes that I can't afford.

[George Camel]

So the back taxes is everything you owe. You don't have any other debt? Car loans, credit cards, medical debt?

[Rachel Cruz]

I don't have any. I have a car loan, no credit cards, student loans. That's it. My debt is minimal, but my income is even more extreme. Minimal.

[Caller]

Yeah. What do you do for a living?

[Rachel Cruz]

Right now I just work in a factory.

[Caller]

Okay.

[George Camel]

What is your son doing during the day?

[Rachel Cruz]

Unmedicated. He is usually having what we call a bad day. He usually hears voices.

[George Camel]

Is it just you two in the home? Is there anyone else involved here? Other family?

[Rachel Cruz]

No, I have a daughter. She's 19.

[George Camel]

Okay, and is she in the home as well?

[Rachel Cruz]

Yes.

[George Camel]

What does ongoing care look like outside of this inpatient treatment?

[Rachel Cruz]

Outside of the inpatient. Continued therapy and I'm sure medication.

[George Camel]

Okay.

[Rachel Cruz]

I had a father who was also schizophrenic and so. And, you know, and. And so. But I'm. I'm willing to sell my house or whatever for his. For his care because at some point you have to break the cycle. And most of, you know, things that happen with people who suffer from mental illnesses is the lack of quality care.

[Caller]

Yeah.

[Rachel Cruz]

And people being able to afford it.

[George Camel]

It's very noble, as his mother, to be willing to do that. My only fear is that you sell this home, cover the care, and now you can't afford rent somewhere?

[Rachel Cruz]

Right now I'm paying rent and a mortgage to power bills. I mean, I'm behind in those because.

[George Camel]

Why are you paying both?

[Rachel Cruz]

Because I rented out my house without protecting myself with a lease. And then the guy moved out. And so for the remainder of my lease, I've been paying the rent and mortgage.

[George Camel]

So you were renting a different place and then you subleased it to him, but then he stopped paying, so now it's on you.

[Rachel Cruz]

Well, my house that I own. I rented my house out to someone I know.

[George Camel]

Okay, but I'm confused why you would continue why you're paying rent to yourself if you're the landlord. My misunderstanding.

[Caller]

You're living somewhere else?

[Rachel Cruz]

I'm. Yes, I'm living somewhere else.

[Caller]

When. When is that lease up the.

[Rachel Cruz]

Wherever you're renting in just two more months.

[Caller]

Two more months. Okay. How much are you paying in rent right now?

[Rachel Cruz]

$1,000 in rent and an $800 mortgage.

[Caller]

Okay, so the rent will be done because you'll move back into your house. So that's $1,000 freed up, which is great. Just from your overall financial. Okay, overall financial perspective, are you behind on the home that you own?

[Rachel Cruz]

No.

[Caller]

Okay, but you are behind on rent?

[Rachel Cruz]

Yes, I'm usually behind two weeks late rent.

[Caller]

Okay, so I'm caught up for the.

[Rachel Cruz]

Month, but I don't owe any back months.

[Caller]

Okay, I gotcha.

[George Camel]

And what's left on the car loan and the student loans?

[Rachel Cruz]

Well, I have student loans and my daughter has student loans, and that's about $12,000.

[George Camel]

Are the student loans cosigned for her? It was like a parent plus loan.

[Rachel Cruz]

Parent plus loan. And then I have my. Have some myself.

[George Camel]

Okay. Is she working or she.

[Rachel Cruz]

Yes, and she. She just graduated and she will pay those herself.

[George Camel]

Okay, good. I'm just trying to find any way to alleviate you in order to create some margin right now. And what's your car payment every month?

[Rachel Cruz]

150. And my insurance is $100.

[George Camel]

Okay. And what's the house worth.

[Rachel Cruz]

Right now?

[Caller]

It's probably.

[Rachel Cruz]

Worth 130.

[George Camel]

And what could you sell? What do you owe on it?

[Rachel Cruz]

57.

[Caller]

Okay, so Taylor, as a mom, I can't feel you. I can't empathize with your exact situation. But we say all the time, I mean, like, your kids are everything. Right. And when there's a health issue involved, parents will do anything. I mean, you're like, I'll sell my house for it. So what I would say before you make any decisions because I know you're gonna. You're going to help your son. Is. Is. I would research, I would keep researching because there is a plethora of medical care and a spectrum price wise that is very different. So 60 maybe at the high end could he get care for 20? Right. And there's. There's an A path that's more financially stable in that way.

[Rachel Cruz]

I get it. Switching banks is a pain in the. You know what.

[George Camel]

But if your bank doesn't line up.

[Rachel Cruz]

With your money goals, it's time to make the switch to Fairwinds Credit Union. Listen, you guys know how I feel about big banks. They make money when you stay broke. Charging you overdraft fees, pushing credit cards and telling you debt is normal. And that's why I only work with folks who help you, not just profit off of you. Fairwinds is different. They're owned by their members, their non profit and they share our values. They even advertise with billboards saying they want their members to be debt free. So they built the Smart Checking and Savings bundle just for Ramsey fans.

[George Camel]

You can open your account online in minutes and here's what you get. Free checking with no minimums and no monthly fees.

[Rachel Cruz]

Savings with a high APY to help you in baby step one and beyond. And a mobile app that actually makes sense. Plus you also get access to over 33,000 fee free ATMs and more than 5,000 affiliated branches nationwide. So don't settle for a bank that's slow. Close your progress down.

[George Camel]

Choose one that's built to help you win with money.

[Rachel Cruz]

Go to Fairwinds.org Ramsey and open your Smart Bundle today.

[George Camel]

Fairwinds is federally insured by the ncu. Carl is with us up next in dc. What's going on, Carl? How can we help?

[Rachel Cruz]

How you doing, sir?

[George Camel]

Great.

[Caller]

All right, sir. Did you just call George sir?

[George Camel]

I feel.

[Caller]

How.

[George Camel]

How old are you, Carl?

[Caller]

That was kind.

[Rachel Cruz]

I'm 17, sir.

[George Camel]

Someone raised you right.

[Caller]

Look at that respect.

[Rachel Cruz]

Thank you. All right, my question is. So I plan on going to the Navy or Air Force. Ideally Navy.

[George Camel]

That explains it.

[Rachel Cruz]

There's the manners.

[Caller]

Well done.

[Rachel Cruz]

I would like to dream scenario go to the United States Naval Academy in Annapolis. If that does not work out, I will do ROTC down in the south and currently run two businesses, you could say. And I'm planning on making around $13,500 this summer.

[George Camel]

You're breaking up on us, Carl. Speak directly into the phone. Oh man. Please don't tell me we're losing Carl.

[Caller]

No, no, we're not. We're not. Carl, you there?

[Rachel Cruz]

Hello?

[George Camel]

There we go. Okay.

[Rachel Cruz]

All right. So I'm trying to go to the Naval Academy. If not do rotc.

[George Camel]

Okay.

[Rachel Cruz]

My question is, would it be smart to buy a used Tesla Model y for around $23,000 using a parent like my parents buy it, I give them a $10,000 down payment, they pay the rest and I pay them over the course of about my Navy stipend and what I will make with my job. I just do not know if it will be smart to put me in that like position of owing money at a such a young age.

[George Camel]

Easy answer. No, it is not smart. And I'm glad you were thinking through it. What worries you about this? Why do you think it's not smart?

[Rachel Cruz]

Because college is like where I will go. It's really like tied together. So I could walk. The only issue would be, is like I would be driving a lot, going to work because I would ideally want to be a land, do landscaping, which would require me to drive places. I would also have to drive like to my parents house, etc. And they have solar. And where I would go I could charge it for free, which would make sense logically, like in terms of electricity. Just, you know, that worry of what if an unexpected thing comes up and I cannot pay for that because I owe my parents money.

[George Camel]

Okay, you're thinking through it. How much money do you have?

[Rachel Cruz]

Right Now I have $4,000 cash. I would save up for about another two more months, pay $10,000 down, maybe more. $10,000 is like the bare minimum. And then they would pay for it and I would like the difference with their money out of pocket. And then I would pay them back over time.

[George Camel]

Why do they have money? Are your parents pretty well off where they could maybe match whatever you put in?

[Rachel Cruz]

Yes, sir.

[George Camel]

So let's say you put in $6,000. Would they be willing to chip in another $6,000 and you pay 12 grand for a cash car?

[Rachel Cruz]

Yes, sir.

[George Camel]

That to me, if this is a masterclass in personal finance, this is the number one thing that will make you successful. Stop thinking about how much down, how much a month and just think how much. And if you don't have that amount, you just say no. And that's delayed gratification. Most adults in America today don't have that. But if you can learn it at 17, you're going to be a multi millionaire by the time you're in your 30s. Yeah, because most people just collect more payments and go, well, it's normal. I'll put money down.

[Caller]

And I would say, too, Carl, this is a great place to practice a level of not only living within your means, but a level of contentment. Like, could you go get a $25,000 Tesla? I mean, through what you say, I mean, there's an avenue. You could do it. Or could you drive a, you know, a five thousand, six thousand, seven thousand dollar car and be good with your lifestyle? Right. When you jump lifestyles so quickly. Larry Burkett. This is an old quote used to say that we spend the first five to seven years of our marriages trying to obtain the same level of lifestyle our parents did, but it took our parents 30 years to get there. And so this idea that we're gonna. We all of a sudden want to live a life as if we're a 30 year old, but we are a 17 year old. Right. You kind of jump that and, and doing it creates debt as well. So there's a contentment piece and a math debt piece. And if you can solve both of those, like what George is saying, and learn to be content and good and also stay away from debt, like, your life will look so different in 10 years versus if you went another path.

[Rachel Cruz]

All right. Yeah. Most of my money right now is in stocks and precious metals. Just as like a buffer. A lot of the Tesla stock and Palantir, which is done me pretty good, and I just would want to not. Well, I really don't want to get in a position of thinking I have money that I don't and then overspending and then dig myself into a deep hole. Because 10 years down the line, I don't want to be worrying about where my next bill is going to go and what debt I'm gonna have to pay off. I'd rather know where I'm going to put it and how that's gonna grow and prosper with me.

[George Camel]

Yeah, you're doing some good things right now. I personally don't have any single stocks or precious metals. I would encourage you to do the same. I just invest in mutual funds, so giant baskets of stocks, because, as you know, Elon can burp or leave the White House, and your stock goes crashing down and you freak out and sell it at a loss. And the same with precious metals. You're not really buying anything there. Precious metals don't produce anything. You're just buying a different form of currency that's not really going to go up in value like the stock market will. And it's usually peddled from Fear mongers who say, hey, if it all comes crashing down, at least you'll have some gold. And so I would encourage you at this young age, you don't need to live like a boomer, buying precious metals because you saw an ad on late night TV. And you also don't need a $23,000 car when you make $13,000.

[Rachel Cruz]

Got that?

[George Camel]

So we say that your everything with wheels and motors in your life should add up to no more than half of your annual income. So what will you make in the next 12 months?

[Rachel Cruz]

In the next 12 months. So if I keep doing what I'm doing, ideally like 40,000, 40 to 60, depending on how busy I get.

[George Camel]

And then if you join the Navy too?

[Rachel Cruz]

No. So I have another. About another year till I will go. And that would just be working. Working like nothing and then saving everything because I don't really see a value in putting. Buying a bunch of, like, useless stuff. I would rather just save it for when I need it. So just constantly working and then.

[George Camel]

Yeah, you've got a lot of flux in your life right now. There's a lot of changes happen. And so I would not tie yourself to a payment. I wouldn't tie yourself to a $23,000 car at 17 years old. I would buy however much you can afford in cash. And if that's $5,000, that's your budget. Not long ago, I bought a car for $6,000. And my next car from that was a very, very, very, very old Tesla. And so. And Rachel has a Tesla too. We, we love Teslas. And so don't get us wrong, this is not me trying to dog Tesla. But trying to do it for the gas savings is a pretty insane justification to drive what we all know. I just want to drive a cool car.

[Caller]

I know. And I hate for you to do landscaping in a Tesla, you know?

[George Camel]

Yeah. You're gonna destroy that thing. If a piece of grass lands in there, it explodes.

[Caller]

You should see three kids in the back of mine.

[Rachel Cruz]

Yeah.

[Caller]

Let alone landscaping.

[George Camel]

Sure. It was all caked in there. Nasty.

[Caller]

Goldfish crackers.

[George Camel]

Yep, I know. So, Carl, I would buy the best car you can get and do a pre inspection, pre purchase inspection on it. It'll probably cost you 100 bucks no matter what you're buying to make sure that you know what you're getting into and that there's not going to be a ton of repairs and stick to reliable brands.

[Caller]

Yeah. And Carl, I feel like you knew all this too. I mean, you can I just say, as a 17 year old kid. Like the conversation we've had with you is more promising than some we've had on the show even today with adults. I mean seriously, it's incredible. Like you really are, you're a very forward thinker, you're a problem solver, you've started business. I mean like, it's incredible. And the discipline you have even to, to long within the military route. I'm like all of it. Like, like there is so much good coming from you, Carl. So it's very impressive. It is very impressive. And I would continue to be curious, continue to learn when it comes to this money stuff. Read. Yeah, I, I can continue to get some of this knowledge because I mean some of the decisions you've made, I think you know, are, are fine. Like, right? I mean you're, you're okay, but if you start going down a road which this Tesla purchase using debt would start to open, that's a new lane in this financial space and it's one that we say to steer clear of. And that's your gut, Carl. So trust your gut. You have a smart, you're smart. You have a good head on your shoulders. So trust yourself in this. And remember, wealthy people do really boring, boring things. They save up and pay cash for stuff they invest in, not exciting things, but old mutual funds and their 401ks and their Roth IRAs. Like it's not flashy and exciting, Carl. Okay. But that will build you wealth over time, over a long period of time. So trust your gut.

[George Camel]

You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and.

[Rachel Cruz]

There'S too little life insurance or none at all. Grieving families are suddenly left behind, scrambling.

[George Camel]

To pay bills and trying to make ends meet.

[Rachel Cruz]

I also discovered that there are a lot of rip offs in the life insurance world. Like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your family. The key is finding an independent broker.

[George Camel]

Who represents a ton of companies and works for you, not for the insurance company.

[Rachel Cruz]

This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about.

[George Camel]

They shop the term life companies to.

[Rachel Cruz]

Find you the best options and they've.

[George Camel]

Been around for over 95 years, so.

[Rachel Cruz]

You know they'll be there when you need them. Zander is the real deal and that's.

[George Camel]

Why they've handled all my personal insurance.

[Rachel Cruz]

For over 25 years. I trust them and you can, too. Visit Zander.com for instant online quotes or for a more personal touch, give them a call at 800-356-4282.

[George Camel]

Welcome back to THE Ramsey Show. I'm George Camel here with Rachel Cruz taking your car calls at 888 825-5225. Let's get to the question of the day brought to you by why Refi? You didn't plan to default on your private student loan, but now you could have a way out. Why Refi helps you explore refinancing options with a low fixed rate and a payment plan based on your ability to pay. Take the next [e-mail] Ramsey that's the letter y r e f y.com Ramsey may not be available in all states.

[Caller]

All right. Today's question comes from Jamie in Hawaii. My dad passed away earlier this year and since then the stock market has dropped. My 82 year old mom is concerned because she sees that she is losing her money. I know how you feel about long term investing, but does that hold true for someone in their 80s? She's in pretty good health, but I don't see her living any more than 10 years. Should she stay the course or move to a less volatile, volatile investments?

[George Camel]

So the overall question here is should your investing change as you head into your final stages of life, say the 80s, 90s, last decade? Personally, no. I'm going to be staying stay invested in equities until I pass from this earth. Now a lot of people move to more conservative investments like bonds. So they might have a split like a 6040 where 40% in bonds or 70, 30 were 30% in bonds. And she's saying the stock market dropped. It's now back up to record highs. I don't know when this question was sent in but like depending on what week you look at, I would not be concerned with temporary drops. And I also don't know what her financial situation is. Does she have money outside of this? How often is she withdrawing? How much is she she withdrawing? How big is this total nest egg? Lot of questions here that I would contact a smartvestor pro to dig into to give her a plan for the next 10 years. But the short answer is we know that if your investments, you know, the rule of 72 would say if you get a 10% return over a long haul, then every seven years your investment would double.

[Caller]

Yeah.

[George Camel]

So if she has a million bucks in that nest egg, it's going to be 2 million seven years from now.

[Caller]

Right.

[George Camel]

That's pretty wild. Yeah. So I would not pull the money out out of, you know, fear.

[Caller]

Right.

[George Camel]

Because you could be losing out on that million dollars.

[Caller]

Yes. Yeah. And I think that's the, that's the case is to understand that this is a long term play and even 10 years, I mean that's long term. I mean that, that's a decade that you're looking out for her. And so there's enough room within that for there to be some ups and downs, even to a 3, 4, 5 year period of time usually. So I would go, Jamie, and I would look and understand the fear drives a lot of people because of that emotion, drives a lot of people to make bad financial decisions, especially with the market. They want to end up pulling money out. And if she's losing money and it's at the bottom and she freak and the worst time it is, it is. So you need to be really leaning on facts and so looking to see, okay, what has, what has the history been of the stock market? Where are we today? Where have we been in the last 12 months, 24 months, you know, I mean, you can kind of map it out year by year, but overall you're going to see that the economy over time continues to go up. It will, there'll be some dips every now and then, but you can't let those dips, like you're saying short term, create a long term problem for you for pulling all of your money out.

[George Camel]

It's always come back. Even after the worst crashes. You look at a year later, two years later, maybe three years later, and the market is back to record highs.

[Rachel Cruz]

Right.

[George Camel]

So if you're saying she's going to live for at least 10 more years, likely, God willing, and the creek don't rise, I would let it ride and tell her to stop looking at the portfolio and only take as much out as you need. You don't need to be cashing this whole thing in ever. And so I would not let that be a concern. There is zero chance of her investment going to $0. That would mean we're in a, an apocalyptic situation where every company in America has gone bankrupt. I think the last thing we'll be concerned about is our 401k balance at that point. So I'll be in my bunker. That helps. Yes, Rachel, I will be there too, if Winston will let me in. That's what I'm have a friend with a bunker.

[Caller]

I know I need to get one, but we don't have you're telling me.

[George Camel]

You don't have a bunker?

[Caller]

We don't have a bunker.

[George Camel]

I feel like Winston is prime demo.

[Caller]

No, he would like having a bunker. Yeah, I know. I know he would be. No, but he's. He's more like live on. Live off the land. Like he could figure it out if it all went.

[George Camel]

That's true.

[Caller]

Helen. Ham basket. I think Winston. I don't know. I trust my husband.

[George Camel]

Winston would somehow figure.

[Caller]

I think we could find water. He.

[George Camel]

I think he could kill a deer. I don't know if this was the Hunger Games Witness could. Winston would beat out Katniss.

[Caller]

I don't know. But yeah. All that to say. Jamie, tell your mom we'd stay in but talk to a smartvestor pro for sure to look at your long term. What to do, what decisions to make in these next 10 years for her.

[George Camel]

I know she could live to be close to 100. I've had a lot of family members.

[Caller]

And we just celebrated Nana 96. We celebrated her birthday this weekend. 96.

[George Camel]

That's amazing.

[Caller]

I know.

[George Camel]

And we had another family member on the cruise with us.

[Caller]

Oh, my papaw. He's 96 too. Yes.

[George Camel]

That's amazing.

[Caller]

I know.

[George Camel]

Well, had a good time. All right. Wendy is up next in Boise. What's going on? Wendy?

[Rachel Cruz]

Yeah. Hi. Thanks for taking my call. I have a question. My husband and I are 52. We're both entrepreneurs. About two years ago, we sort of had like a panic. Well, it was coming, but like a panic wake up call that we weren't invested anywhere for retirement or anything. We started investing a ton of money about. What would you say, honey? No, per month.

[Caller]

Hi, honey. Tell him we said hi.

[Rachel Cruz]

Oh, can you. They said hi to you. Basically at this point Today, we've got $100,000 invested and we are doing about $4,000 a month. His income, the nature of his business is that it's seasonal and so there'll be like ebbs and flows with like slower months and then really good months. But on average he brings in about around eight grand and I bring in around 5,000.

[George Camel]

Right.

[Rachel Cruz]

My income comes from a network that work that is just residual income. So I like, I have the ability to continue to work. But we. In the last couple of years, I invested in like a continuing education something that was $8,000. And I helped one of my daughters buy a car. So we have $14,000 in debt. We've never carried debt before, but we have it now. But our $4,000 per month investment makes things really tight. So my question for you is, should we invest less for right now and get that debt. Debt paid down, or should we stay the course and just make more money to get the debt paid down?

[George Camel]

I mean, you'll be done with this debt in 90 days if you just hunker down, pause investing for 90 days. That's not going to put a big dent in your investments, but it will make a huge impact on your piece and your margin.

[Rachel Cruz]

Okay. Okay. That's what I was wondering. So my husband just popped the headphone and said, yeah, he's saying, like, just hunker down for the next 90 days, stop investing and get the debt paid off.

[George Camel]

Yeah. You said you have 13k in debt.

[Rachel Cruz]

14.

[Caller]

What do you want to do? Wendy? What does he want to do? I'm curious if y' all have conflicting.

[Rachel Cruz]

Well, I think, I think, I think for me, I was more panicked about retirement, like all of a sudden a couple years ago. We have six kids, we have a large family. You know, I don't want to be dependent on anybody. And we've lived a kind of a, you know, being an entrepreneur sometimes is a little unpredictable. So we've had. We've lived that kind of a life where we've worked really hard, we've invested a lot. And so all of a sudden I was like, oh, my gosh, you know, if this business doesn't last forever, I want to make sure we set ourselves up in a really good place where we can still fly to see our grandkids and, you know, give gifts to everybody and all that kind of stuff.

[Caller]

When did you guys have. Do you guys have any money saved outside of investments?

[Rachel Cruz]

Yeah, we usually try to. We try to follow that two to three month, but it's kind of gotten eaten up.

[Caller]

Okay.

[Rachel Cruz]

With some debt. And that debt might be 20 grand because with the other business, we kind of hold short term, but that I try to get paid off every month and sometimes I don't have to have, you know, for work or personal. And so it can be 20.

[George Camel]

But yeah, this might be four to five months of debt pay down, of just getting aggressive and then maybe saving up an emergency fund, so maybe another four months of saving. So let's say eight months from now you're back to investing. You're still going to be okay. I just crunched the numbers for you.

[Rachel Cruz]

That's my question. Okay, that's my question is I. I'm more panicked about retirement than he is. I feel like, oh, my gosh, if we stop doing like we're Going to.

[Caller]

Be old and no, you're fine. Wendy here show. Tell her the this is.

[George Camel]

I just popped in some numbers. You told me you're 54. You have a hundred thousand saves 52. Oh, 52. Even better. Okay, let's say you don't even start investing again until you're 53. Let's say 53 to age 67. You keep this up, four grand a month, nothing changes. You don't get any raises, you don't make more money. You will have $1.85 million in that one account.

[Rachel Cruz]

Wow.

[George Camel]

That's at a 10 rate of return, which is what we've seen over decades in the stock market if you invest in good growth stock mutual funds. So let that give you some peace. Yes, you're going to be working a little longer, but you'll likely be making more money as time goes on.

[Caller]

Yeah, and y' all need to go plug in these numbers and mess with the calculator because I mean that's facts. That's what you'll see. And then sit down with an investment professional and really map it out. But pay off your debt. Y' all need to pause everything. Pay off the debt, get some cash. Cash buffer in your lives that's going to create the piece like what George is saying. And then you guys can go full on investing and you're going to be a hundred percent fine. So you're on the right track.

[George Camel]

Welcome back to the Ramsey show. Open phones at 888-825-5225. If you are tired of living paycheck to paycheck, feeling like you can't get ahead, you gotta join one of our free EveryDollar trainings we've got going on every week this month. They're all hosted by one of the Ramsey personalities. So you'll see one of our friendly faces guiding you through how to make stick to a budget and even find 9,000 do dollars of margin using everydollar so that you can get out of debt and start building wealth. Plus you can ask us any question during the live Q and A. So sign up for free everydollar.com webinar. You got nothing to lose because it costs you nothing but an hour of your time. Don't miss it. Frank is up next in Charleston. How can we help you today, Frank?

[Rachel Cruz]

How you guys doing? It's an honor and pleasure to talk to you. Rachel. You got to give us the top 10 reasons why it's so tough to be a child of Dave Ramsey again. I heard that about 20 years ago.

[Caller]

Oh my gosh. That's when I spoke in high school. Wow. Golly, Frank, that's crazy.

[George Camel]

You must be ancient Frank.

[Rachel Cruz]

I am, I am. I can get my discounts at Dunkin Donuts for coffee.

[Caller]

Now that was what, probably that was like a 2003 time.

[Rachel Cruz]

Yes.

[Caller]

Yeah, probably right around there.

[George Camel]

Simpler times.

[Caller]

That's crazy.

[George Camel]

What ails you today, Frank? You've been listening a long time. Have you followed the principles?

[Caller]

Yeah. You should be. Why are you calling us Frank? Oh, what'd you do?

[George Camel]

So I have a brother in law.

[Rachel Cruz]

Who is just a big dumb animal and I love him dearly. And he came to me and says, hey, I got 20 grand I'm gonna put down on a car, but I need help, obviously I need help. And I said, you have 20 grand. Okay, fine, I'll do it for you. So I co. Co signed for him.

[Caller]

Oh, you're big dumb. Your big dumb brother in law. That's what you said?

[Rachel Cruz]

Yeah.

[George Camel]

You got in the mud with this animal, my friend. We can't tell the two apart. We don't know who's dumb and who's smart.

[Rachel Cruz]

No, and all I can hear in.

[George Camel]

The, in the background when I got.

[Rachel Cruz]

Done doing this is then is Dave saying and, and reciting scripture to me saying one who signs debt for another is stupid.

[Caller]

Yeah, that's right.

[George Camel]

That sounds like it.

[Rachel Cruz]

I'm like, why did I do this?

[Caller]

God?

[George Camel]

Yes, God said it.

[Rachel Cruz]

So now I'm, I'm in the process of either just letting this go into a voluntary repossession because I don't need it, I don't want it. And he's going away for a very long time on a vacation, an unwanted vacation.

[George Camel]

Is he going to prison?

[Rachel Cruz]

Yes. Yes.

[George Camel]

Oh boy.

[Rachel Cruz]

Okay, anyways, yeah, so now it's an.

[George Camel]

Eleven hundred dollar car payment and goodness gracious. What kind of car was this?

[Rachel Cruz]

It was a Chrysler, brand new. Chrysler 300. Yeah.

[Caller]

Can you sell it?

[Rachel Cruz]

Well, I can sell it, so either way I can sell it. But right now I, the buyout is 62 on it and to sell it it's going to be around maybe 50.

[George Camel]

Is that private party or is that training?

[Rachel Cruz]

Yeah, that's, that's private party. I listen to your show all the time, George.

[George Camel]

Okay, so you're going to be. You're 12 underwater. He obviously has no money. He's, he's going to prison. And you, do you have money?

[Rachel Cruz]

I do, but I, I don't, I don't want to do this. I don't want.

[George Camel]

You already did it. My friend, it's just gonna add insult to injury. You understand what's gonna happen with the repo, right? They're gonna sell it at auction for, like, 15 grand, and you're still gonna owe the difference.

[Rachel Cruz]

Yeah.

[George Camel]

It doesn't get you out of it, and so it's gonna be even worse if you do the repo, so you might as well control the variables here. Here. And sell it for as much as you can, and then even, you know, take the cash as a stupid tax and go. All right. I owe 12 grand to get this out of my life. That's the only way out of this. That is going to leave you with the least amount of harm.

[Rachel Cruz]

Okay? Because it's. It's. It's currently the. The. What we owe on it right now to get this up to. Is like $5200. So it's up for repossession right now. So I am. I am in South Carolina. This car is in Arizona. So I'm trying to work with my.

[George Camel]

Are you saying you're behind on payments by five grand?

[Rachel Cruz]

Yes. So with penalties and taxes and this and that. So this. They're out. They're gonna find this car eventually. If I don't come up with it.

[George Camel]

You'Re gonna have Dog the Bounty Hunter at your door, man. I would not go through with this. This is not the way you want to go, Frank. So I. Do you have five grand to get current on payments?

[Rachel Cruz]

I do, but my wife won't give it to me.

[George Camel]

Oh, boy. Does she have control of this money, or is she just.

[Caller]

No, she's mad at you. She's mad at you. She's like, don't take that out of our.

[George Camel]

Okay, well, it's gonna cost you guys as a family a whole lot more than five grand if you do it the wrong way. And so she's gonna be. You're gonna be sleeping on the couch. You might as well live in this car at this point.

[Rachel Cruz]

Yeah, that's kind of. That's kind of what I was thinking. That's kind of where we're at right now because, you know.

[Caller]

Did you do it without her, without talking to her?

[Rachel Cruz]

No, I did it with talking to her, and she said don't. Oh, no, no, no.

[Caller]

You know what else Proverbs says? What is it? The. The woman who could find a virtuous wife for her worthless far above rubies, and her. The heart of her husband safely trusts her, and he will have no life again. Oh, man. Frank. Yeah. Ouch. Man, that. This hurts. So you got to go to her with all humility and say, I'm, I'm.

[George Camel]

I'll make it up to you.

[Caller]

I'm so sorry. But this, but this. George's point. For real. For real, Frank, you, you guys are going to end up paying more if this ends up getting repoed. So it hurts at the front end to pay it all. Get rid of, do it, you know, pay the, pay the backlog, sell it, pay the difference. All of that is going to be so much less painful than the dragging through this repossession and then having to end up owing even more on the back end. So go ahead, rip the band aid off.

[Rachel Cruz]

Yeah, they could sell this car for 30. And now I'm into it for 30.

[George Camel]

30 I. And you'll be lucky if they sell for 30. I mean, they're gonna sell it for bottom dollar at auction because they don't give a rip.

[Rachel Cruz]

Yeah.

[George Camel]

And they're gonna put you on the hook for the difference plus fees. And so I would get current as fast as possible. Sell it as fast as possible.

[Caller]

How long ago did you co. Sign it?

[Rachel Cruz]

Probably almost a year ago.

[Caller]

Okay. Yep.

[George Camel]

I've been trying to get out of.

[Rachel Cruz]

It for the past year and a half. You know, he's like, oh, I'm gonna get it, I'll get it. Re. You know, I'll get it in someone else's name or I'll I it. I'll get you off this in six months, Frank. No, no worries.

[George Camel]

Yeah, if a sketchy lender doesn't trust you to give you a loan, maybe you shouldn't trust that person. You know what I mean? So does your brother in law have any money that you can get access to? If he's going to prison, he might as well leave you with a parting gift.

[Rachel Cruz]

No.

[George Camel]

Sounds like he was broke to begin with though. Yeah, I figured.

[Rachel Cruz]

Yeah, he was. Yeah, he was broke to begin with and just. Yeah, big mistake. Big mistake.

[George Camel]

So how much money do you have? Liquid between savings, Anything else you could sell.

[Rachel Cruz]

So it's probably, you know, 10 to 12,000 bucks.

[George Camel]

So you don't even have the money to make good on this deal? No, I mean, I don't have the.

[Rachel Cruz]

Money to.

[George Camel]

Like, you can get current on payments, but you don't have the difference in cash?

[Rachel Cruz]

Yeah, no, I don't have the difference in cash. So it's going to be. Well, I'm, I might. I've got five closings this week, so.

[George Camel]

Oh, good. Okay. Let's hope that if that doesn't work out, you can go to your local credit union and take out a personal loan for the difference and then clean that up fast.

[Rachel Cruz]

That's my. That was. I'm. I've got an appointment with the credit union tomorrow.

[George Camel]

Okay, good, Good. I hope they're kind to you and I hope you can clean this mess up. And I'm glad you learned the lesson and I hope everyone in America did to never co sign for anything.

[Rachel Cruz]

Never co sign. I'm going to write, I'm writing that on the back of my truck right there. Don't. Perfect for anyone.

[Caller]

Never ever.

[George Camel]

Are you out of debt, Frank?

[Rachel Cruz]

No, that's, that's. That's another 45 minute conversation.

[George Camel]

But I've got my notepad here of everything I've got and man, aren't that.

[Caller]

Total money makeover event you went to in 2003 didn't really stick, did it, Frank?

[George Camel]

No, no.

[Rachel Cruz]

Well, it did. It did for. It did for a long time. And then, you know, I kind of, you know, you wander your way back into debt, you can't wander your way out.

[George Camel]

So he knows the quotes? Yeah, I've got them all. Believe me. Frank's got the bumper sticker. Oh, Frank, we like that.

[Caller]

You can get back on the horse. We believe in you, Frank.

[George Camel]

We are believe in you. The number one reason I don't cosign for anyone, Rachel, I don't know if they're going to be a future criminal to my list of fears. Well, I don't want to hitch my wagon to some buddies.

[Caller]

Unbelievable. I know. All right, good. Let's learn from Frank. If you Hear Smart Advice 20 years ago, take it.

[George Camel]

Take it the first time and listen to your virtuous wife.

[Caller]

That's right. Amen.

[George Camel]

Foreign.

[Rachel Cruz]

These days the Internet is chock full.

[George Camel]

Of so called investing advice from random.

[Rachel Cruz]

Goobs with zero qualifications. Listen folks, you deserve guidance from someone who knows what the flip they're talking about. That's why I recommend the Smartvestor program. Smartvestors can help you find a professional.

[George Camel]

Financial advisor who can teach you to.

[Rachel Cruz]

Make your own best decisions with your own money. Get [e-mail] smartvestor again ramseysolutions.com smartvestor Ramsey.

[George Camel]

Solutions is a paid non client promoter of participating pros. Learn [e-mail] from the Ramsey Network this is the Ramsey show where we help people build wealth, do work that they love and create amazing relationships. I'm George Camel here with Rachel Cruz as my co host today. Also my co host on Smart Money Happy Hour which you can check out on the Ramsey Network over you wherever you listen to your podcasts. Tim is going to kick us off in Jamestown, New York. What's going on, Tim?

[Rachel Cruz]

Hey, good afternoon Rachel and George. It's a real pleasure to speak with you today.

[George Camel]

You as well.

[Rachel Cruz]

Thank you. We actually visited Ramsley Solutions about three years ago.

[George Camel]

How did it go?

[Rachel Cruz]

Rachel, we got to meet you. My son.

[Caller]

Good to talk to you.

[Rachel Cruz]

Their debt free screen.

[George Camel]

Oh, that's awesome.

[Caller]

That's fun. So great. We have a great audience today as well. That, that, that is here. So, so fun. I love it.

[Rachel Cruz]

Oh good. Yep. That was one of the, one of the highlights of, of the last decade for me was being, being at Ramsey Solutions. It's a, it's an amazing place.

[Caller]

A decade. Wow. I'll take that.

[George Camel]

Yeah, I'm lucky to be top five on any list. How can we help?

[Rachel Cruz]

So well. So question for you. My mother in law has told my wife that she wants to start giving her some money each year out of her 401k account. She says between her pension and her Social Security she has more than enough to live off of and she wants to start giving some of her wealth to her children to enjoy now.

[George Camel]

Love it.

[Rachel Cruz]

Yeah, sounds great. But we weren't sure what we should do in this situation. I know. My mother in law met with an attorney who advised her that he can give away up to maybe $18,000 a year with no tax implications.

[George Camel]

Sure. She won't have, you know, there's a gift form. I mean you can give up to what, 14 million per person out of your estate. So how wealthy is she?

[Rachel Cruz]

I don't know, but I know she's fine. Like what she said her, just between her pension and Social Security, she lives very comfortable.

[George Camel]

Yeah. I take her word for it.

[Rachel Cruz]

Okay. Yeah. Well the only thing she takes out of her 401k is the, the minimum, minimum she's required to take out each year.

[George Camel]

Yeah, the rmd.

[Rachel Cruz]

Yep. Yep. And she gives most of that away to charities she wants to start. Yeah. She's wonderful. She's done very, very well over the years. She and my father in law who's. Who passed away quite a while ago. But they've done very well. We're very proud of them.

[George Camel]

So what's your fear here? What's the hang up?

[Rachel Cruz]

Well, yeah, one of our fears is, well I guess we never saw this coming. So it kind of, kind of rocked. Yeah.

[Caller]

Took you off guard.

[Rachel Cruz]

Oh, absolutely. But one of our fears is there is some history of like dementia in her Family like she's the youngest of five sisters and several of her older sisters ended up having to go to skilled nurses. We're praying very hard. She never does. But our concern is, well, what if she does, you know, do we want to take her money if she might need it when she goes into that and you know, we just, we want to, we want to take care of her first and foremost and make sure she's, you know, doing the right thing with her resources.

[George Camel]

Well, it sounds like 18,000 out of her nest egg. Is, is that a big portion? Does she have a million in the nest egg?

[Rachel Cruz]

I wish I knew.

[George Camel]

I think that would help me feel better about it. I think, I think that would give you some peace because we don't know how much she has. If she has $200,000 in this account and she's giving 20 grand away, that might give me some pause. But if she has a million and it's producing, you know, $100,000 of income per year on average, or at least in growth, then I'd go, okay, that's, you know, and if it's on her volition between her pension and Social Security to, to give this money. So I would accept it knowing that we might need to consider future medical care for her.

[Caller]

Yeah. If you asked her if she would show you guys her whole financial picture, would she or she a private person and she wouldn't?

[Rachel Cruz]

I'm not sure she would, but we can give it a try. My wife has one brother, so maybe that maybe the two of them can get together with her and maybe she'd share. Okay.

[Caller]

Yeah.

[George Camel]

Did she say how much she's going to give? I know their attorney said 18 grand would avoid the, you know, the gift tax forms and all that, but is that what she's decided on?

[Rachel Cruz]

She, well, she already gave, she already gave my wife and my brother in law $10,000 each already. And I, I don't know if she wants to give 10,000 a year, but she said up to 18. I, it was kind of unclear.

[Caller]

Okay.

[Rachel Cruz]

She was going to do okay. Okay.

[Caller]

Yeah. So I think from like a, like a family, boundaries, morals, you know, whole conversation, we're seeing more and more of this, of people while they're alive, want to start passing their inheritance to their kids or to their family versus dying and you guys get it all, you know, upon her death or something. And so, so it is becoming more common. And I think your hesitations are right in the sense of, hey, we want to make sure that she's taking care of herself. First and foremost. And so if I was her daughter, that's probably how I would present it. Of like, hey, mom, you know, this is incredible. Like, we, we were not expecting this. I'm so honored that you're, you know, choosing to be so generous with us, but I would love just to sit down and kind of see everything, map everything out and just walk through a couple of situations that could arise here in the next, you know, 10, 15, 20 years and make sure that you're taken care of. Like, we want to make sure you're good, you know, and just kind of start that conversation and look at those numbers, look to see if there's a plan, if she has even long term care insurance. I mean, I don't know, but get some of those answers and then I think you guys would feel better at accepting the gift in its entirety, knowing that she's good, she's taking care of herself, she's being wise for her. And it's just you guys get the repercussions of a blessing of someone that's done really well and that's an honoring legacy, you know, for her to see you guys use what she and her husband had built for so long. So I think it's amazing.

[Rachel Cruz]

Yeah. Yeah, it is a real honor. It's a. It's a real blessing.

[George Camel]

What are you guys going to do with the money?

[Rachel Cruz]

Well, I guess that was kind of our next question. I mean, we've been saving for retirement. We've been debt free, completely debt free for six years. I forgot when we paid off the house.

[George Camel]

Awesome. Congrats.

[Rachel Cruz]

Yep. Yep. We've been out of, out of consumer debt for decades and finally paid our house off several years ago.

[George Camel]

And it sounds like your kids are doing very well for themselves.

[Rachel Cruz]

Oh, our kids are all doing great. They're all on board with all the Ramsey teaching. They're all debt free.

[George Camel]

How do we clone you guys? This is amazing.

[Rachel Cruz]

I don't know.

[George Camel]

America would be in a different place. Tim, I love it. Well, here's what I always say. Never block a blessing. So if she wants to give the money, I would accept the money. If you want to invest the money, knowing one day we might use it to help pay for her care and kind of it goes full circle, that's fine too, because you guys have a lot of options with what you do with it. And chances are you're going to have so much money when that we're ready to cross that bridge, you'd be able to cover the care without even thinking about it. It and it sounds like you're the type of people to do that.

[Rachel Cruz]

Yeah, yeah, that's what we were leaning towards was maybe investing that money at least short term to see how things go.

[George Camel]

I think that's wise.

[Rachel Cruz]

What would be the best tool to invest that in if we do that?

[George Camel]

If you didn't want to do in retirement to where it was a little more flexible because how old are you two?

[Rachel Cruz]

I'm 58 and my wife is 59.

[George Camel]

Okay, so you're on the cusp of being able to access retirement funds. But if you wanted to just keep it liquid, I would just open up a taxable brokerage account account and just park it in an S P500 index fund and just let it ride. And you know, who knows what the market will do. But that should give you that around that 10 over a long period of time. And that money should double for you every about seven years. So 10 grand one year, 10 grand the next year, 10 grand the next year. You know, 10 years from now you could be looking at 200 grand sitting in that one account from just parking the money and if you chose to use it, nothing wrong with that either. Cuz likely you guys are going to have multi million dollars if you're doing it right 10 years from now. And so you should have no problem paying for that care. I love it. Just responsible people helping other responsible people. What? What a best case scenario this is.

[Caller]

We'll take it all day. Well done T. Well done.

[George Camel]

So here's a plot twist no one warns you about. You budget for the big trip and you thought of everything. But then boom. You're at the airport trying to buy a phone charger that costs more than the checked bag fee. Welcome to summer. The season of surprise spending and overpriced everything. But don't let it catch you slipping like some dollar store flip flops. Alright? Stay on top of your budget with the EveryDollar app. It's the easiest way to make a plan for your money and give everydollar a job. Basically it's you telling your money what to do instead of wondering where it went. Like how did I spend $40 on pistachio popsicles? Yeah, the plot twist is real. But with every dollar you'll stay a step ahead. Ahead. So go download the EveryDollar app for free in the App Store or Google Play today. Two weekends are on sale now for the money and marriage getaway. Featuring none other than my co host Rachel Cruz and our friend Dr. John Deloney. Spend three incredible days in Nashville with your Spouse learning the tools to strengthen your connection, deepen your intimacy and more. It's happening November and in February. Early bird pricing is available now. Tickets start at 7:49 per couple. Get your tickets for the lowest price before they end. Go to ramseysolutions.com getaway or click the link in the show notes if you're listening on YouTube or podcast. I know Rachel's already prepping for that.

[Caller]

It's one of the best events we do. I think, George. It's one of the most fun. I mean, if you guys know Dr. John Deloney, he's a hoot. And I mean, just to do all, I mean, to do a full weekend with people is fun.

[George Camel]

You get to really create a connection and a moment.

[Caller]

There's something about being with the same group of people over the course of two to three days and you're like, oh, yeah, you know, you recognize people. It's like this camaraderie that's built.

[George Camel]

Yes. And it's fun. Like, yes. They talk about serious stuff. Go there. It's vulnerable, but it's not like a crisis very like, you know, just gripping yourself the whole time.

[Caller]

It's not. Yeah, we get real, we get real real quick. But also it's enjoyable and fun. So it's all the things. So come join us. It's, it's great.

[George Camel]

Ramseysolutions.com events all right, John is in Reno, Nevada. Up next. What's going on, John?

[Rachel Cruz]

Hey, guys. How are you?

[George Camel]

Great. What's your question today?

[Rachel Cruz]

Oh, so thank you for taking my call. I appreciate it. I bought, my wife and I bought, purchased a house from a family member, and the family member has asked us specifically not to pay off the house early. So I don't know if I get stuck at baby step six or do I move to baby step seven?

[George Camel]

Why are they asking that?

[Rachel Cruz]

So the family member, I think, I think they're, they're trying to leave, leave that as a gift for after they pass away. And I don't think they, if they didn't want their tax bracket messed with either.

[George Camel]

I don't understand. Are you. Did you finance it through them?

[Rachel Cruz]

Correct. Yes, sir.

[George Camel]

Oh, so they're saying, hey, if you pay us back all of this money too soon, it will count as income for us and kick us up in the tax brackets. Is that their concern?

[Rachel Cruz]

Correct? Yes, sir.

[George Camel]

By paying it off early. So let's say you paid $50,000 toward your mortgage, which is them, that's $50,000 of income for that year that they have to report.

[Rachel Cruz]

Correct. Yes, sir. Yes, sir.

[George Camel]

What are, what's the terms of this mortgage? Is this official or is this just like a handshake agreement?

[Rachel Cruz]

No, it's official. Everything's written out.

[George Camel]

Okay. What would happen if you just decided to refinance and get out of this deal and have the mortgage be on your terms?

[Rachel Cruz]

I don't think they would, I don't think they want that. I think the, it's my wife's father, and I think he's more trying to keep that as basically like a steady form of income for when he retires. And then ultimately whatever's left, it's, it wouldn't be paid off within the amount of time. He knows that. And his, his intention is at that point, when he passes, it's yours.

[Caller]

So he's wanting you guys to be paying the, essentially the mortgage payments and he's using that money for retirement, is what you're saying.

[Rachel Cruz]

I believe, I believe that's, that's what it is. Yeah.

[George Camel]

But your names are on the deed.

[Rachel Cruz]

What's up? Sir?

[George Camel]

Are you and your wife's names on the deeds on your own? Your. Her dad is not on the deed.

[Rachel Cruz]

Her dad? Yes, yes, my wife and I are on the deed. No, I'm sorry. The deed is still his name.

[George Camel]

That's the worst. That means you don't own the house that you are paying down and until.

[Rachel Cruz]

He would pass away. Correct.

[George Camel]

This feels crazy, man. Okay. So I, I'm trying to figure out what he's doing. I think I've got it. He's trying to leave this to you guys. So the house will be. You won't have the Step Up. It'll have the Step up basis versus just selling it to you outright. But then why make you guys pay? Because he can't afford it.

[Rachel Cruz]

I, I, I'm not entirely sure of that.

[George Camel]

I just, this was a. You can't go back in time and undo it. But I would undo it if I could. This has left you guys in a very precarious situation where he's getting all the benefit. You're just renting a house from him that hopefully becomes yours one day, essentially.

[Rachel Cruz]

Yeah.

[George Camel]

So therefore, I would not pay it off early because you don't even own it. It, if you paid it off today, it doesn't make you the owner of the house. That's the scariest part.

[Rachel Cruz]

Oh, okay.

[George Camel]

And if, and if you buy it from him today, that changes the basis price because it becomes the market value of that home.

[Rachel Cruz]

Yeah, I see what you're saying.

[George Camel]

So if he bought it for 200,000, and now it's worth 600,000 as you're living in it. Well, if he just, if he just passed away and left it to you, you, that price, that basis would remain 200 would, would step up. And so if the house is worth 600,000, you would owe taxes on anything above that when you sell it. And so I think that's part of it is he's trying to avoid some of this tax situation, but he's, he's tied you guys to this thing. Really terrible way. Would this be the house you bought otherwise, and would it be the price point you bought it?

[Rachel Cruz]

I'm sorry, can you say it one more time, sir?

[George Camel]

Is this the house you would. If you had any choice, and whatever house you bought, would this be the house you chose and the price point that you would choose?

[Rachel Cruz]

Yes, sir. It's been, it's, it was his mother's originally, and when she passed away, she said, make sure that we get it. So it was given to him, and then he is, we're, we're buying it from him is the way that you're not buying it.

[George Camel]

And then if you buy something from him, it becomes yours. And you just told me it's not yours even if you paid it off.

[Caller]

Today and the grandmother told him to give it to you. All right, was it a paid, was it paid off? Off.

[Rachel Cruz]

Yes.

[George Camel]

So he created a mortgage out of thin air in order to create income for himself?

[Rachel Cruz]

I, I, I think, I think so, yeah. He wanted, he wanted a steady form of income for after, an additional form of income for after he retired.

[George Camel]

I feel like there was a better way to do that than you guys renting it from him while he's alive. Okay, so is he able to work right now?

[Rachel Cruz]

Yes, sir. He's, he works.

[George Camel]

Okay. I'm just picturing this. What would happen if you guys, you can't even sell the home because you don't own it. Do you understand how dangerous this is?

[Caller]

I, he doesn't feel like it is because, because it's gonna go in the, in the will, right?

[George Camel]

Maybe. Hopefully one day. But you guys are. Until then, you're in these weird handcuffs.

[Caller]

How old are you guys, John, you and your wife?

[Rachel Cruz]

I'm 33. My wife just turned 40.

[George Camel]

What happens if you guys get a job in another city and decide to move?

[Rachel Cruz]

We, we can't really. We're kind of tied to our area.

[George Camel]

Well, yeah, you're tied to that house. You have no equity. Think about it. Let's say you pay off you pay this thing down. 100 grand. You have built $0 in equity in.

[Caller]

This house, home for under your name. It's all now in the dad's name.

[George Camel]

And he's not really giving you anything. You paid it all down. Yeah, he could have done that with a normal home. There's no benefit to you guys at this point.

[Rachel Cruz]

Okay?

[George Camel]

All the benefit is on his side.

[Caller]

It's all on his side. And just to say that you guys are living in the grandmother's house that she wanted pass down to. You know what I'm saying? Like, it's. There's nothing here for you all. I mean, unless and when he dies. I mean, how old is he? In his 50s? 60s?

[Rachel Cruz]

He's. He's. He's in good health. A 64.

[Caller]

All right, so. So pops is going to be living till 30 more years.

[George Camel]

He's 93. And you still don't own a home.

[Caller]

Yeah. Or is he going to give you the deed when you. When he paid off? Like, I don't understand.

[Rachel Cruz]

Well, and that's. That's the thing. He's asked us not to pay it off. He's. He doesn't want his taxes mess with.

[George Camel]

Dude, I would get out of this deal and just go rent somewhere else and he can rent it out and when he passes, he can still deed it over to. To you. That's honestly what I would do. I'd rather you go build your own wealth, because we don't. There's too many variables and they're all in his favor right now. So I would personally get out of the situation. He can rent it out if he wants income. I think he's using you guys as a scapegoat in all of this and I don't like it.

[Caller]

Easy renters, easy situation.

[Rachel Cruz]

I. Now I. I don't know if we can. I mean, we've signed. We're. We've signed a contract and everything. I don't know if we can just.

[George Camel]

Up and leave, man. You signed up for a mortgage with a house you're not owning. That scares me. I would work with an attorney and see if there's any way you need.

[Caller]

To get the deed in. Yalls name would be the next only.

[George Camel]

Way I would continue.

[Caller]

Yeah.

[George Camel]

And I don't care what that does to his taxes or his inheritance plan. You guys need to do this in a way that is wise and less risky.

[Caller]

This is.

[George Camel]

This is the Ramsey show.

[Rachel Cruz]

Listen, your home is your most expensive asset. And now you're ready to sell fast.

[George Camel]

And for a lot of Money. But in this wackadoodle real estate market.

[Rachel Cruz]

One mistake could cost you tens of thousands of dollars. Here's the deal. This ain't amateur hour. You need a pro in your corner.

[George Camel]

Someone who knows how to price your.

[Rachel Cruz]

Home right, market it well and negotiate the best deal. That's where a Ramsey trusted real estate agent comes in. To find one near you, go to ramseysolutions.com agent. That's ramseysolutions.com agent.

[George Camel]

We know that you guys have been trying to help people in your life get started on the Ramsey plan. So we built something for you. It's the Ramsey 101 playlist to help you help them. It's an free, easy to share playlist that covers all the basics for someone who's just getting started with Ramsey and just needs to be dunked in the pool. So clips like, what are the baby steps? How to pay off debt with the dead snowball, how to build an emergency fund, and so much to more. So here's how to share it. Just click the link at the top of the show notes to open the Ramsey101 playlist on YouTube. You can then hit the share button and text it DM it, send it in the group chat, and if you're listening on radio, we've got the playlist featured at the top of our YouTube channel. You can just head over there and share it. It's one share that could help change someone's life. Kyle is in San Francisco up next. Welcome, Kyle. How are you doing?

[Rachel Cruz]

I'm good. How are you?

[George Camel]

Doing great. How can we help?

[Rachel Cruz]

Thanks for having me on the show. So me and my wife has had this plan to purchase a house about three and a half years from now. And I've recently been getting more into my finances and actually listening to the show and just trying to figure out how we're going to do it with how much debt we're going to have.

[George Camel]

Do you currently have debt?

[Rachel Cruz]

I currently have about $50,000 in debt, but we're going to have a lot more of that in three and a half years when my wife graduates from her grad school.

[George Camel]

Oh, boy.

[Caller]

Oh, what's it gonna be? How much?

[Rachel Cruz]

So it's gonna be close to 200,000 because she's getting her doctorates in what? Veterinary medicine.

[Caller]

And where? In what?

[George Camel]

Vet.

[Rachel Cruz]

Veterinary medicine.

[George Camel]

Okay.

[Rachel Cruz]

Yes.

[George Camel]

Okay.

[Caller]

How much will she be making when she graduates?

[Rachel Cruz]

Close to what I make, which will be around 150,000.

[George Camel]

Okay. And you guys are. Are you legit in the Bay Area?

[Rachel Cruz]

So I'm Only over here for work. I'm going back home to Mississippi in three and a half years when she graduates. In three and a half years.

[George Camel]

Okay.

[Caller]

She in Mississippi?

[Rachel Cruz]

Yes, she comes. Seems me every once in a while. Go home, see her every once in a while if we make do what we can.

[George Camel]

Oh, boy.

[Caller]

How long. How long are you guys married?

[Rachel Cruz]

We've been married for a little over a year. We've been together for nine years.

[Caller]

Okay.

[George Camel]

Can you find a job that's either remote or in Mississippi to be closer to her?

[Rachel Cruz]

So the job I currently do, I worked this job in Mississippi. I'm only here on a temporary contract.

[Caller]

Oh, okay.

[Rachel Cruz]

For how long to help for the next three and a half years.

[Caller]

Oh, it is for three and a half years.

[George Camel]

It's not very temporary.

[Rachel Cruz]

Yeah, it's not very temporary, but. Okay.

[George Camel]

Well, that's neither here nor there. You're asking how you're going to afford a house in Mississippi?

[Rachel Cruz]

Yes, sir.

[George Camel]

Okay. Well, the good news is, combined, you're going to have a $300,000 plus income three and a half years from now, maybe even more.

[Caller]

Hopefully you'll get a raise a little bit maybe.

[George Camel]

And so in three and a half years, you're going to be able to clean up at least your debt and maybe start knocking hers out or at least have her stop accumulating it. Can we stop the bleeding now? Has she already taken out all the loans she's going to need?

[Rachel Cruz]

Yes, so a lot of it scholarships. But the loans she has to take grad school, it's pretty much already set in stone and it's on a deferment, so she doesn't have to pay them back until six months after she graduates is when she has to start paying her loans back.

[George Camel]

What's your 50k in debt?

[Rachel Cruz]

So I've got 18,000 in her car. I still owe 25,000 on my truck. I've got about 2,000. And student loans, which will be paid off pretty soon. And then together we have about 8,000 in credit card debt.

[George Camel]

Okay. How aggressively have you guys been tackling this debt? Has it kind of just been minimum payments and throwing a little extra when we count?

[Rachel Cruz]

Ken? Yeah, we've stopped the credit card stuff. We've cut them up, thrown them away, stopped using credit cards. And we're trying to. We're working on trying to get those paid off. As far as the. The truck and the car, we're just making normal payments on those. And my student loan debt will most likely be paid off in a month or two.

[Caller]

So she's just in school right now. Is she full time in school or is she working?

[Rachel Cruz]

Yes.

[Caller]

Okay. What. What?

[Rachel Cruz]

It'll be full time.

[Caller]

Okay. How much are your cars worth?

[Rachel Cruz]

So my truck is currently worth maybe a little over 40,000.

[Caller]

Oh, okay.

[George Camel]

So you could sell it and net 15 grand.

[Rachel Cruz]

Yes, technically. Yeah.

[George Camel]

Okay.

[Caller]

And how about hers?

[Rachel Cruz]

Her car is probably worth about 20.

[George Camel]

Okay, so you can net two grand for hers. That gives you 17 total. Could you buy two used cars for that amount and roll with them for the time being?

[Rachel Cruz]

So I'm actually driving a company truck right now, and I'm not even driving.

[Caller]

Oh, good. You won't even miss. That's perfect.

[George Camel]

At least sell yours right now and net that 15 and buy yourself something used in cash.

[Rachel Cruz]

Yeah, and I could sell.

[Caller]

Yeah. Because here's. Here's what I'm feeling, Kyle, If I. If I were to be honest. So I just feel like you. You guys cutting up the cards, the credit cards, is. Was a great first step, but, I mean, it's like she had you. You guys are just used to living what I would say is very normal. Yeah, We. We want to go to school here. We can't afford it. We'll take out some student loans. We want some cars. Can't afford them. We'll just take out some loans. We'll get some credit card debt over here. My job's over here. Your. Your school's here. We're gonna live apart for three and a half years. It just kind of feels a little bit. Just kind of like hodgepodge or something. I don't know. And. And I think there's something would be really great for you all is to have some strict structure around an element of your life. And I would put money as that category. And to say, what if we did things so differently on how we've handled money thus far? Because so far, it's not, like, looking great, you know? And what if we just did the complete opposite of what we've been doing and actually have some level of, like, this healthy control and a plan in place while these other parts of our life are just kind of out there? Right. I mean, like, school, like, she's gonna graduate. I don't know. It just kind of feels out there. And there's something me that's like, I just want you guys to have, like, a firm plan in place that's uncomfortable for y' all for a little bit, which would be good. Meaning sell the cars, like, get rid of the debt, get rid of the car payments. And Kyle, you start Saving up a ton. You could. And you could knock out your student loan. You know, you guys can knock out this eight grand. Like. Like you could start making some big progress right now while she's in school. And then when she graduates, you guys have a fleshed out plan that when you're making 300, maybe 350. I don't know if you. If you're starting to make more and you have, then you'll have. You'll have at that point then 200,000. If you've paid off all the debt in the next three and a half years, you'll have $200,000 on a $300,000 salary. And to make a crazy goal of what if we paid all of the student loans off in a year, in 18 months? And then we could save like crazy because we have great incomes for an emergency fund, a down payment on a home. Like, you guys could start getting some major trans attraction. But I feel like you guys need, like a little bit of, like this, like, zap.

[George Camel]

Some urgency in your.

[Caller]

In your spirit or something, you know, to. Some radical change needs to occur. And I think selling the cars, you guys could probably just pay them off. But I kind of like the idea of just doing something drastic.

[Rachel Cruz]

Yes.

[Caller]

To kind of feel a little bit of this.

[George Camel]

Shock therapy.

[Caller]

Yeah.

[Rachel Cruz]

Yes.

[Caller]

So that's what I would do.

[George Camel]

Because you guys, I mean, on your own, Kyle, you're. Are you bringing home like 8k a month right now?

[Rachel Cruz]

Yes, just about.

[George Camel]

Okay, and how much of that do you need to live on for expenses, bills, insurance, all that?

[Rachel Cruz]

Well, California's proved to be more expensive than I originally thought, but. So I need at least probably 5,000 of that to live off of.

[George Camel]

Okay. That leaves you with 3K. And so if you sell this truck, that leaves you with what, 20? The 18 plus the 10. So it's 28K. Okay. You getting that?

[Rachel Cruz]

Yes.

[George Camel]

So you'll be done with that debt in nine months at this rate if you do nothing else but throw every extra cent of margin toward your debts. And that's if she keeps the car, by the way.

[Rachel Cruz]

Yeah.

[George Camel]

So nine months from now, you're completely debt free.

[Caller]

And then keep living like that.

[George Camel]

And then keep living like that, save for your emergency fund or, you know, at this point, start paying off for student loans. You don't have to wait for them to be in deferment. I'd start attacking them. As soon as you can.

[Rachel Cruz]

Yep.

[Caller]

Especially since there's no interest accumulating.

[Rachel Cruz]

Yep. And. And so you think it would be okay to to pull a mortgage on a house when she graduates.

[George Camel]

No, I would not buy this three and a half year plan. I don't know where this number came from, but you are not ready to buy a house until you're completely debt free with an emergency fund and a down payment. That might be five year plan.

[Rachel Cruz]

Okay?

[George Camel]

But guess what? You also will have an amazing income on the other side of this. So take advantage of that. You. You'll make up for lost time making 300 grand with no debt. I promise you that. So don't lose hope. But we need to get started on this now. Not waiting three and a half years from now and hoping that life has changed drastically. We got to change first. So I believe in you, Kyle. You guys are going to be doing real good. But we got to clean up a little mess first. I wish you guys the best on this journey. Sam, our scripture of the day. Psalm 121, verses 1 and 2. I will raise my eyes to the mountains. From where will my help come? My help comes from the Lord who made heaven and earth. Earl Wilson once said, one way to get high blood pressure is to go mountain climbing over molehill. Ain't that the truth? Only a guy named Earl can pull that one off. I love that.

[Caller]

That's funny. That's a second.

[George Camel]

People who over inflate, over dramatize. I don't know anyone who would over dramatize anything except for Rachel Cruz.

[Caller]

No drama here.

[George Camel]

Rachel does it to me.

[Caller]

Don't get overly emotional. It's fine.

[George Camel]

Rachel does it to entertain others. It's never self serving. Never so selfless with your drama.

[Caller]

Thank you.

[George Camel]

All right, Calder is up next in Columbus, Ohio. Calder, thanks for calling us.

[Rachel Cruz]

Hey, thank you so much for having me. It's been a dream to be on this show.

[George Camel]

Absolutely. We're glad to take the call. What's going on in your world?

[Rachel Cruz]

Yeah. So we are currently paying for our own wedding, me and my fiance for next year in the San Francisco Bay area. And her relatives have a lot of strong opinions on how we should handle things. And I could use some advice.

[Caller]

Like what? What are their opinions?

[George Camel]

Yeah.

[Rachel Cruz]

So a little context. I grew up as a. I'm a third gen Chinese American. I grew up in the San Francisco Bay area. My fiance Tina, she grew up in Columbus, Ohio. She's a first gen Vietnamese and she grew up in the Vietnamese Catholic church. I grew up in the Christian church.

[Caller]

Okay.

[Rachel Cruz]

Her family is very, very traditional in terms of, you know, Catholicism, Vietnamese culture. You know, they really appreciate me and they really love me, but, you know, there's some differences and religion and whatnot. So, you know, they are expecting us to do, you know, these traditional tea ceremony things and certain Catholic service and whatnot. And. Yeah, you know, we want to have our wedding kind of how we want to. And we both are on the same page about.

[Caller]

Sure.

[Rachel Cruz]

At the same time, we're in a conflict of how do we have our own wedding our way versus trying to accommodate, you know, all of our guests. Obviously, you know, half the guests are going to be Vietnamese, and then half of them are.

[George Camel]

Do you guys get a say on the invite list, or is it like, mom's going to invite all of her friends no matter what? Now you guys are footing the bill.

[Rachel Cruz]

So I would say, for the most part, like, 90%. I would say we're kind of taking the invite list. However, we do feel like we are kind of forced to kind of invite some people just because, you know, they do say, you know, the blood is. Blood is thicker than water. Do we really want to invite them?

[George Camel]

Sure.

[Caller]

And they're not paying from a financial standpoint. You guys are. You guys are paying for everything, right?

[Rachel Cruz]

That's correct. We are going to be paying for everything.

[George Camel]

Have you guys talked about the financial piece of this with either side of the family?

[Rachel Cruz]

Correct. What do you mean?

[George Camel]

Has anyone. Have you talked about, here's what it's going to cost, or we're going to offer to pitch in, or they not even offered at all.

[Rachel Cruz]

So our families are. So my. Our families are pretty generous. Like, I would expect us to probably cover, honestly, maybe the cost of the wedding, which is probably going to be around 30 or 40,000. But, no, we haven't really brought up the cost with them yet. Yet. I don't know if it's more. So, like, the cost is really not.

[Caller]

Yeah. Because you. You guys have enough money to pay for the wedding, is that correct?

[Rachel Cruz]

That's right.

[Caller]

Okay, so what I would do, I mean, honestly, Calder, this is, like, kind of the first bump in the road of, you know, to a degree, are, you know. You know, you and your wife become your own family unit, and that's leave and cleave. Yeah. It's not a disrespectful thing, but this is. This will go on, and they will have. Have different opinions for the rest of your life. And so this is kind of one of the first benchmarks of the precedent of how we handle this and their feelings for how we're probably gonna do it going forward. And so it's gonna be really uncomfortable. But I would have her take the lead because it's her family. But if you both want to. But I would let her definitely initiate. Definitely.

[George Camel]

She handles her side. You handle your family.

[Caller]

Yeah. And if she wants you with her in the conversation, that's great. But I would sit down with them in person, if you can. Is ideal. And in a very respectful, you know, gracious way, you know, tell them thank you, obviously, for all that they are and who they are. And you guys cannot wait for this union and life together and all of it. But there are gonna make. There are gonna be decisions that you all make as a family unit that are going to make them uncomfortable. And mom and dad here. Here are probably what it's gonna be. There probably is not gonna be a traditional cat. I mean. I mean, and I would just go through it and rip the off. And again, it's not. You're not being disrespectful by any means. They may take it as that, but that's theirs to carry if you do it. Go ahead.

[Rachel Cruz]

And the hardest part is, is that. So we are. We're very pretty strong Christian believers. And, you know, they're more of. They grew up in the Catholic Church, but there's like, this misunderstanding of, like, you know, we're not following their paths and whatnot, but, like, at the end of the day, like, we are, you know, following God.

[Caller]

And the Nicene Creed covers Catholics, Orthodox, Protestant, like, under the Christian umbrella.

[George Camel]

Right.

[Caller]

Genuinely. Genuinely that.

[Rachel Cruz]

Right?

[Caller]

It is. I mean, yeah, the foundation and how the expression comes out is going to look different. And some people on all. All ends of the spectrum are very passionate either way. There's Protestants that are very passionate towards Catholics, Catholics that are very, you know, I mean, it goes all. All the way. So again, it's going to be a tension point because they are very passionate about it. But that in. But that's their opinion, right? Like, that. You're not going to change that. And. But what you can do is control the decisions that you guys make, how you treat them. And going forward, honestly, it's like, it's kind of. That. It makes it strong. I mean, honestly, it makes you and your wife, especially since you guys are on the same page and there's not tension between you all, I think, in a stronger. A stronger unit. But that's. I mean, that. That is so. That is very hard. Very, very hard. Because, yeah, there's a lot of opinions and a lot of strong convictions. Right. Especially when you bring in a spiritual element. They really do. They feel It.

[Rachel Cruz]

And on top of that, like, so her family's in Ohio and. And more spread out on the east coast and then. But we're having the wedding back in California, so, like, it will be a destination for them to come as well. So that element of them traveling, you.

[George Camel]

Know, that's upsetting them. Insult to injury.

[Rachel Cruz]

Right.

[George Camel]

You're not having a traditional Vietnamese Catholic wedding, and we got to travel across the country and there's not going to be a tea ceremony. What happened?

[Rachel Cruz]

Right.

[George Camel]

What happened to my daughter? What have you done to her? Yeah. Welcome to the first of many disappointments that you will experience with in laws. I know there's going to be very few things you ever do that make them happy.

[Caller]

The way you raise the kids, I mean, all of it, it's just going to. They will have their opinions and the.

[George Camel]

Best thing you can do is. Is just hold the boundary while being respectful and kind.

[Caller]

That's right.

[Rachel Cruz]

Awesome. No, I appreciate you guys for. For all your advice and input. Yeah, you're.

[George Camel]

You're approaching this from the right way. You sound very level headed. Nothing about this is trying to be rebellious and irreverent, but there's going to be a point where you go, this is my new life with my new wife. And at some point I can't ask mommy for her opinion unless. Unless I ask for it, in which case I will take it.

[Caller]

And your parents were from the Middle east, so. And I do think different cultures. Right?

[George Camel]

Yeah.

[Caller]

There is a stronger tie. Not that U.S. american, you know, aren't that. But there is. I mean, there. There is something to be said. It's a. It's a very. There's a close.

[George Camel]

I didn't have a traditional Arabic wedding. I. I married a very white woman who's out there right now. Then my parents weren't opinionated because we did the. You know, I've been a Southern boy now for a long time. I didn't have my wedding in the old Arabic Baptist church that I grew up in.

[Caller]

Y Y.

[George Camel]

But, you know, there's things I'm sure they disagreed with. But I did have a legitimate camel at my wedding, so that was my nod.

[Caller]

You did.

[George Camel]

To my last name and the Middle Eastern culture. And that made my dad very happy. He spent most of the wedding just engaging with the camel and taking selfies with it. So I would call that a win. So maybe that for Calder, there's some advice. Get a live animal at your wedding. It could distract from the fact there's no tea ceremony.

[Caller]

Oh, man, that is hard that's so hard.

[George Camel]

You know what, the destination wedding sometimes.

[Caller]

Is great because some people don't end.

[George Camel]

Up coming and sometimes that's great.

[Caller]

Great. I know, I know.

[George Camel]

But hey, my grandma that was able to make that was her last trip.

[Caller]

Wow.

[George Camel]

Yeah. Back in 2018 for our wedding and.

[Caller]

So she flew in from where?

[George Camel]

She flew in from Boston.

[Caller]

Oh my gosh. That's great.

[George Camel]

So shout out. She recently passed RIP Grandma, I love you. There you go. Cherish family, honor them. But also you do. You don't do anything cuz someone forced you to. It'll just create resentment in your heart and that doesn't help any relationship. That puts this hour of the Ramsey show in the books. Thank you to my co host Rachel Cruz, all the folks in the booth keeping the show afloat. Appreciate you guys listening in. We'll be back before you know it.

[Rachel Cruz]

Sam.