Stop Avoiding The Hard Truth About Your Finances

Summary

The Ramsey Show — Episode Summary

Title: Stop Avoiding The Hard Truth About Your Finances

Date: April 1, 2026

Hosts: Dave Ramsey & Jade Washall

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Episode Overview

This episode of The Ramsey Show centers on confronting painful financial realities, learning from previous mistakes, and taking deliberate actions to regain control over your money. Through listener calls and candid conversations, Dave Ramsey and co-host Jade Washall offer direct advice on urgent debt problems, real estate missteps, personal responsibility, and the emotional side of financial decisions. The episode covers a wide array of topics, from risky loans and car debt to tax questions and the emotional fallout of divorce and financial secrecy in marriages.

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Key Discussion Points & Insights

1. Facing Hard Money Truths: Don’t Let Panic Lead to Bad Deals

• Caller in Crisis: The Bridge Loan Dilemma

  • [00:41] Stefan in Denver calls about a dangerous bridge loan taken on his house to move his kids out of an unsafe neighborhood. The home hasn’t sold, leaving him stuck with nearly $170,000 owed and few good options.
  • Dave pulls no punches:

    "You can't use that excuse anymore because now you've stepped neck deep into stupid. What you should have done is gone and rented a property." — Dave Ramsey [02:37]

  • Advice:
    • Restructure the debt ASAP, refinance with a credit union, and get away from high-interest lenders.
    • Avoid selling to investors at a steep loss if possible.
    • If forced to use credit cards for a temporary period, it’s still better than staying with predatory lenders.

• When Stress and Urgency Dictate Choices

  • Jade reflects:

    “When you're fearful and you do things out of fear, you have to really think every way about the decision you're making. And when you do things in urgency… Let me make sure I'm making the right choice.” — Jade Washall [07:07]

  • Dave’s “stupid tax” lesson — writing checks for bad decisions — resonated throughout:

    “Desperate for me always equals stupid… I do something stupid.” — Dave Ramsey [07:32]

2. Cars, Rentals, and Debt: Sell What’s Sinking You

• Should We Sell the Rental, or the Trucks?
  • [11:10] Andrew from Atlanta wonders whether to sell a rental property to clear $87,000 in debt, most of which is car loans.
  • The hard truth:

    “It exposed the stupidity of these car purchases. So no, I wouldn't sell the rental property. I'd sell both cars.” — Dave Ramsey [14:01]

    • Experiment with selling the cars for 90 days; if life feels worse, the caller can always repeat the process with the rental:

      “Try this stuff for 90 days, and if… you hate it, you'll never go back.” — Dave Ramsey [16:43]

    • Jade notes how rationalization and fear can anchor people to poor decisions.

3. Education, Kids, and Debt Choices

• Student Dilemmas: Tuition vs. Credit Card Debt
  • [21:31] Christian from Texas, a college student, needs advice on whether to use savings for tuition or pay down credit cards.
  • Dave says:

    “Pay cash for the tuition. The trick to getting out of debt is to vow never to borrow again... let the credit card sit, pay minimums, and attack it after tuition is handled.” — Dave Ramsey [22:20; 23:14]

  • Jade elaborates on the “debt steals your ability to build wealth” principle.

4. Employer Overpayments & Integrity

• Repaying Employer Mistakes
  • [25:04] Quinn, a physician, is asked to pay back $17,000 after discovering her employer had overpaid her.
  • Dave recommends negotiating rather than jumping to legal action:

    “If you look at my productivity, it's well beyond 100%, which is very unusual on your staff. I brought this error to your attention… you should consider just waiving this for all of those reasons.” — Dave Ramsey [29:46]

  • Relationship, productivity, and integrity matter just as much as contracts.

5. Should I Travel or Tackle the Last Debts?

• Europe vs. Medical Debt
  • [32:37] Bridget wants to visit her sister abroad but still has $6,000 in unpaid medical debt.
  • Jade warns of self-sabotage:

    "When you decide you’re going to work the baby steps, you have a moment in time where it’s like, I have to... I'm setting the bar for what my lifestyle must be for this to happen... There's going to be a lot of things that are going to try to compete." — Jade Washall [35:51]

  • Dave: Don’t “emotionally rationalize and justify decisions you know are wrong.”
  • Delaying pleasure leads to a better, more satisfying result.

6. Windfalls & Inheritance: Park the Cash, Don’t Gamble

• What to Do With Inherited Money While Planning Law School
  • [44:21] Roman, 23, inherited $100,000 (possibly more). He considers law school.
  • Advice: Keep things “super boring” and avoid risky investments:

    "The best investment Roman can make is in Roman… and that is in training your brain so it is more eligible for more income." — Dave Ramsey [51:02]

    • Store funds in a high-yield savings account until education and life plans crystalize.

7. Small Business Rut: Don’t Hire Until You Need To

• Mechanic Owner: Grow Before Hiring
  • [54:10] Matt, a mechanic, considers hiring but isn't overloaded with work.
  • Jade and Dave: Hire only once your workload requires it, and not before. Explore partnerships and local competitor referrals first.

    "You don't need to hire someone and then both of you end up bored… You need to be making more money as a result of having hired the person." — Dave Ramsey [57:00]

  • Getting out of the “treadmill stage” of small business is about delegation only when there’s excess work.

8. Elderly Parents & Home Equity: Cash as a Safety Net

• [59:48] Jason is helping his 79-year-old parents decide whether to pay off a $50K HELOC, which would drain half their $100K cash.
  • Dave: Keep cash for emergencies, don’t accelerate payoff at their age unless the family can pull together to eliminate the risk. Stability comes first.

9. Tax Questions: Credits, Deductions, Withholding, and Refunds

• [65:25] The hosts offer a user-friendly walk-through of tax deadlines, credits vs. deductions, tax brackets, self-employed quarterly payments, and why getting a big refund is actually bad.
  • Dave: “Santa Claus does not live in Washington D.C. that is not free money. All that is is your [own] freaking money because you had too much taken out.” [73:25]
  • Jade: “If you think debt equals simplicity, they got you.” [107:41]

10. Bankruptcy, Divorce, & Credit Card Settlements

• Should I File for Bankruptcy During a Divorce?
  • [110:10] Margie, 30 years married, faces $108K credit card debt, $137K student loans, and a house divorce.
  • Dave: Likely can’t file for Chapter 7 due to income/assets; better to use professionals to negotiate settlements outside bankruptcy.
  • The show offers direct assistance for some hardship callers.

11. Financial Abuse & Infidelity: Clarity and Action

• [85:47] Kelsey feels “financially abused” — locked out of accounts, excluded, and demeaned in a complex marriage.
  • Dave urges direct confrontation or separation:

    “If it was at my house, this would be over. Today. We're going to sit down… or I'm going to see a divorce lawyer and I'm going to have a two million dollar net worth because I'm taking half of this crap.” — Dave Ramsey [91:15]

  • The hosts clarify later [94:07] the show's definition of “financial infidelity” vs. true “abuse,” advocating honest terminology while still urging action.

12. Real Estate Traps: Unintended Consequences of Seller Financing

• [118:13] Laurie discovers her seller-financed home has a hidden mortgage still in the previous owner’s name, exposing her to possible foreclosure.
  • Dave: The so-called “seller take-back” is risky/possibly illegal; refinance immediately to get clear title.

    “If that is a standard mortgage that's laying on the house... it has what's called a due-on-sale clause... When they discover it, they're going to call that loan… and if they don't, they're going to foreclose on the house you thought was yours.” — Dave Ramsey [120:27]

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Notable Quotes & Memorable Moments

• “Desperate for me always equals stupid... And when you do something stupid and it costs you money? I write in the for column on the check: stupid tax.”
  — Dave Ramsey [07:32; 07:45]
• “If you emotionally rationalize and justify decisions that you know in your brain are wrong… you're getting ready to do something stupid.”
  — Dave Ramsey [36:56]
• “Try it for 90 days. If at the end of 90 days, you hate it, you’ll never go back. But at least you could test the theory.”
  — Jade Washall [16:29]
• “Debt eats at your ability to build wealth over time. It steals your hard-earned income and causes you not to be able to do things like invest.”
  — Jade Washall [24:15]
• “Asking a banker what to do with money is like asking a dog if it’s hungry.”
  — Dave Ramsey [47:05]
• “Ask Ramsey is our free AI tool… so it will answer the question exactly better than we would answer it here on the air because it’s the culmination of all that data and it’s free…”
  — Dave Ramsey [75:19]

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Important Timestamps & Segments

• Facing Predatory Loans & Panic Moves: [00:41] – [07:07]
• Cars vs. Rental Property Dilemma: [11:08] – [17:11]
• Tuition & Credit Card Dilemma (Christian): [21:27] – [24:48]
• Employer Overpayment (Quinn): [25:04] – [31:26]
• Medical Debt vs. Travel (Bridget): [32:37] – [40:44]
• Inheritance & Short-term Parking (Roman): [44:21] – [51:34]
• Small Mechanic Shop Hiring Decisions: [54:10] – [59:13]
• Taxes & Refunds Explained: [65:25] – [74:19]
• Financial Abuse Discussion (Kelsey): [85:47] – [94:07]
• Bankruptcy / Divorce / Credit Card Strategy (Margie): [110:08] – [114:13]
• Illegal Seller-finance “Take-back” Home Deal (Laurie): [118:13] – [125:50]

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Tone and Style

True to the Ramsey brand: blunt, direct, at times compassionate but always tough-love. The hosts combine humor, hard truths, and real-life stories to create a show that is both empathetic and unflinching.

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Takeaways

• Avoid quick-fix loans and impulsive purchases out of desperation.
• Get honest and direct with your financial realities: own your mistakes and take the hard steps.
• Delay gratification to build long-term stability — don’t let emotion steer your financial ship.
• If you're not sure about your rights (in marriage, inheritance, business), get clarity immediately; secrecy and “complexity” are often red flags.
• When in doubt, “super boring” (i.e., safe) is better than clever—especially with short-term financial plans.
• If it feels complicated, get expert help and read every clause before signing anything.

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For more guidance or specific advice, visit Ramsey Solutions or use the "Ask Ramsey" tool for AI-powered responses informed by years of Ramsey wisdom.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fair Winds Credit Union Studios, this is the Ramsey Show. I'm Dave Ramsey. Jade Washall, Ramsey personality number one best selling author is my co host. Today phones at 888, 825-5225. Staphon is with us in Denver. Hey Staphon, what's up?

[Caller]

Hi Dave, how are you?

[Dave Ramsey]

Better than I deserve, man. How can I help?

[Caller]

So I'm in kind of a tight pickle here. About a few months ago, I was looking to move and I needed to move quick because the living situation I was in was not good for my kids. The neighborhood turned and became extremely dangerous. And so I took out a bridge loan to kind of try to get me into a new home. And I was hoping that I was going to come in at a competitive price. My price was already like $30,000 less than what I, what my home was worth. And it's almost six months now and my home, my old home still hasn't sold. And I owe 169,500 by the end of the month. And their two options for me are not the greatest. So I don't know which one to do. They will either purchase a home, but I still have to bring 7,000 to the closing plus 2,000 carrying cost every month it's not sold or I refinance again with them at 143,000 and pay 33,000 at closing and then sell it for keep it on the market for whoever knows how long. I've tried reaching out to investors.

[Dave Ramsey]

And who did you get this loan with?

[Caller]

With up equity.

[Dave Ramsey]

Oh, okay. And so this is not a standard bridge loan. This is. I'm, this isn't. I'm going to screw you bridge and

[Jade Washall]

in a very short period of time.

[Caller]

Yeah, and I didn't realize that. And like I said, my situation, I mean there was ramp their crime was raising and I needed to get my boys out of there as quickly as possible.

[Dave Ramsey]

You can't use that excuse anymore because now you've stepped neck deep into stupid. What you should have done is gone and rented a property. If you need to get your boys safe instead of going into this, instead of stepping up with some loan shark.

[Caller]

Yeah.

[Dave Ramsey]

So instead you went and bought a house that was not required for you to get out of the neighborhood. You could have got out of the neighborhood and gone and rented Something. So anyway, we're here now. What do we do now? And you're not bankable. What's the house on the market for

[Caller]

right now? I just dropped the price again. It's at 170.

[Dave Ramsey]

And is it free and clear? No, I had, I mean, it was before the bridge loan.

[Caller]

Like, what do you mean? Like free?

[Dave Ramsey]

And did you have a mortgage on it prior to taking the bridge loan?

[Caller]

Yes, I did.

[Dave Ramsey]

Of how much?

[Caller]

128.

[Dave Ramsey]

The bridge loan pay off the 128?

[Caller]

Yes, it did.

[Dave Ramsey]

Oh, okay.

[Jade Washall]

Okay.

[Dave Ramsey]

So your only debt against this is the $169,000 bridge loan, you drop the price to 170 to try to get rid of it.

[Caller]

Correct.

[Dave Ramsey]

Okay. All right. Ouch.

[Caller]

And the investors, like, so far the offers that I've gotten are 115, 120. And so I'm looking at, you know, 50 to $60,000 of basically deficit, deficit deficient pay.

[Dave Ramsey]

Do you have any money?

[Caller]

I have about 26 in savings and checking.

[Jade Washall]

What about cars?

[Caller]

I own my car outright, but yeah, I have a car.

[Dave Ramsey]

What's it worth?

[Caller]

I don't know what it'd be worth now. Maybe 17, 15.

[Dave Ramsey]

What do you make?

[Caller]

I make just about 92 a year.

[Dave Ramsey]

Okay. Have you talked to your credit union about a, you know, like $100,000, $150,000 loan and you put 26 with it and get rid of the loan sharks and just put a credit union loan on it and take the panic out of this discussion?

[Caller]

No, I haven't really considered that yet.

[Dave Ramsey]

That would have been where you should have gone first before you did the loan shark deal, but wow. Yeah, I mean, refinancing it without, with and getting these people out of the picture on a five year balloon note or something makes a lot more sense. And then you've got some room to take the beating that apparently you're going to take on price and some room to cover the difference. But right now, I mean, if you write a check for 7,000, you're still on the hook for $2,000 a month, for another $24,000 a year. Is that what you told me?

[Caller]

Basically, yeah.

[Dave Ramsey]

With the, with the loan shark guy. So you write a check for 7,000, you're not out?

[Caller]

No, I'm not.

[Dave Ramsey]

Okay. So that's not really an option. That's like going from bad to worse. So I would rather you write a check for 26,000 and take out $140,000 loan with a credit union on $170,000 house or something along Those lines, or for that matter, I would rather you. Let's establish you are in debt. 170,000 with a rip off. Okay? That's where we are today, right? So now if we restructure that debt, I don't care how we restructure it, as long as we get rid of these guys. So if you borrowed 100,000 from the credit union, put 26,000 in it and put $30,000 credit card, fine, That's a better deal than you got now. And just because credit card, you just got a series of payments, they're not going to come take the house. They're not. You know, but these guys that you signed up with. Whoo. Guido, man.

[Caller]

Wow. Yeah, I really. I really wish I hadn't done that. And I thought it was doing what was best for myself and for the kids.

[Dave Ramsey]

But you were you leaving was best for your kids? I'm not making that argument. But how you. Oh, man. Oh, my gosh. Yeah, I would have just put the house on the market, left and gone and rented something. But that's behind us now for those of you out there that are listening. So, yeah, that's. Restructure this somehow and get these goobs out of your life. Get Guido out of your life.

[Jade Washall]

The lesson for the listener is when you're fearful and you do things out of fear, you have to really think every way about the decision you're making. And when you do things in urgency. So those are the two things that need to make you stop and go, wait a minute, Let me make sure I'm making the right choice and I'm not. Does that make sense?

[Dave Ramsey]

Yeah. I can look back on the worst deals I've done in my life, and they usually followed me being desperate.

[Jade Washall]

Yeah, there you go.

[Dave Ramsey]

Desperate for me always equals stupid. As soon as I get desperate right after that, my brain quits working and I do something stupid.

[Jade Washall]

Right.

[Dave Ramsey]

Because the logic behind that's exactly what he did.

[Jade Washall]

The logic behind wanting to move is exactly right. But that's just a good word to the wise.

[Dave Ramsey]

Yeah. And. And you know when you do something stupid and it costs you money? When I do that, I have to write a check for my stupidness. I Write in the 4 column on the check. Stupid tax.

[Jade Washall]

Yes.

[Dave Ramsey]

You have to pay a tax when you're stupid.

[Jade Washall]

And we've all done it.

[Dave Ramsey]

I've paid so much stupid tax in my life, which qualifies me to host this show.

[Jade Washall]

Exactly.

[Dave Ramsey]

Because I have a PhD in dumb, so I know from whence you come. And so if I Say you've done something stupid. It's because I love you and you're just like me.

[Jade Washall]

Your people are my people.

[Dave Ramsey]

You're my people.

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[Dave Ramsey]

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[Caller]

Hey, how's it going? Dave, it's really nice to talk to you.

[Dave Ramsey]

You too. How can we help?

[Caller]

Well, me and my wife are trying to decide if we should sell our rental property to Pay off our debt. So 2024, my income was around 105,000 and hers has stayed consistent, but my income dropped down to about 85,000 last year. And we had this house built when we were, when I was making a little bit more money. And we have our rental property and we're just looking to see if it's a good decision to sell it and pay the debt or if we should just go with the snowball effect, like the snowball program.

[Jade Washall]

How much debt?

[Caller]

What?

[Dave Ramsey]

Yeah, how much debt?

[Caller]

We got about $90,000. It's actually about 87,000 if you include everything.

[Dave Ramsey]

And how much of that is cars?

[Caller]

About 65,000 of its.

[Additional Caller]

Oh wow.

[Dave Ramsey]

65.

[Caller]

Yeah. So it's her. I have a truck in her car.

[Dave Ramsey]

Yeah. And what does she make?

[Caller]

She makes $48,000 a year.

[Dave Ramsey]

Okay, and so you have $135,000 income.

[Additional Caller]

Right?

[Dave Ramsey]

Did I get that right? Yeah, I did, yes. Maybe a little bit more. Maybe, maybe, maybe 140. Okay.

[Jade Washall]

How much of the 65 is the truck?

[Caller]

40 of it is the truck.

[Dave Ramsey]

Okay, what's the rental property worth?

[Caller]

It appraised last year at 265,000 and we owe about 160 on it.

[Dave Ramsey]

Okay, so you got 100 in equity, roughly, not counting fees and miscellaneous. And what's your home worth?

[Caller]

The one we live in right now? Appraised at 410.

[Dave Ramsey]

And what do you owe on it?

[Caller]

328.

[Dave Ramsey]

Okay. All right, cool. Okay, I do you. If you did not have $100,000 in debt, would you be looking to sell the rental property anyway?

[Caller]

No, no, I, I look at real estate as kind of a long term investment. Something that, I mean, how long have

[Dave Ramsey]

you had the rental property?

[Caller]

So it, we've had it for six years.

[Dave Ramsey]

How are you doing as landlord? Are you good at it?

[Caller]

I think pretty well, yeah. I mean we've had only had two tenants. This last 10 has been there for three years. It's, it's actually been relatively pleasant. We kind of live out a little bit away from the city, so it's been relatively nice.

[Jade Washall]

When your income went down, did it affect the amount of your mortgage on your, on your take home pay? Is that where this is stemming from?

[Caller]

Well, I think so. It just, I think cash flow just kind of died when my income went down.

[Jade Washall]

Right.

[Dave Ramsey]

It exposed the stupidity of these car purchases. So no, I wouldn't sell the rental property. I'd sell both cars.

[Jade Washall]

Yeah, because what's the payment on those?

[Dave Ramsey]

Combined I'd get 2, 5 or 10,000. Dollars, cars that are cash. And then I'd plow my way through with $140,000 income, plow my way through the little bit of debt that's left and keep the rental property because it's going up in value and that stupid butt truck. Edden.

[Caller]

No, no. I mean, I do use. I use the truck in my line of work.

[Jade Washall]

Right. But the cars are three quarters of the debt. How great would that feel for those to be gone?

[Caller]

It would feel good. What would I do in a situation that they're upside down? I mean, what's the best route?

[Dave Ramsey]

How much upside down are they?

[Caller]

Well, the truck's not upside down.

[Jade Washall]

That's the first one to go there.

[Caller]

Yeah, the car is probably $10,000.

[Dave Ramsey]

You're not gonna do it.

[Jade Washall]

I don't think you're uncomfortable enough. I think that you had some discomfort.

[Dave Ramsey]

So here's the thing. You had a pile. You had $100,000 pile in the middle of the table. And instead of buying a rental property, you went and bought cars. If you keep the cars, that's what happened. If you don't keep the cars, you say, I bought a rental property with my hundred grand. But you're deciding right now between the two based on this. And, you know, you've already. You've already dipped your toe in there twice since we've been talking to you about keeping this truck. Trying to figure out a reason to keep the truck. Trying to figure out if I'm you. Listen, I got a great truck. I got a Raptor R. It's my. One of my favorite cars, is a. I'm a truck guy. Loud redneck muffler. I love it, man. It's incredible. And I'm with you on owning a truck. I'm not with you on trading a truck for a rental property. No, no, no, no, no, no, no. Rental properties go up in value here in the Atlanta market, for God's sakes.

[Jade Washall]

You also got to play best and worst case scenario. Have you ever had to make a decision and you're. You're scared of it? Worst case scenario, he sells this truck. He hates having the eight or $900 a month back in his pocket. And he says, you know what? I didn't like that. I'm going to go get the truck. I'm going to go back and sell the rental property.

[Dave Ramsey]

I'm going to sell the rental property and then go buy a truck.

[Jade Washall]

Yeah, that's the. I mean, truly.

[Dave Ramsey]

Yeah, you could actually upgrade in truck if you did that. If you decide owning this Truck is a better idea than owning the rental property, which I'm not in agreement with. We were telling you up front, but she's right. Sell it and test our theory.

[Jade Washall]

And if you hate having that cash back in your life, then get it back. Go back and do it.

[Dave Ramsey]

Sell the rental property and go buy a car for cash. And then you can. You can undo this at any time.

[Jade Washall]

That's true.

[Dave Ramsey]

That's very good. Yeah, I would get rid of the cars, both of them, and see how my life feels. And after 90 days, if you think, oh, Ramsey's full of it, I think I joined a cult. Then sell your rental property and take the money from that and go buy some cars, because it's the same thing, dude. It's the same thing. But at least you could test the theory. That's a good point. I like that. Try this stuff for 90 days, and if at the end of 90 days you hate it, you'll never go back.

[Jade Washall]

You've been on the air for 30

[Dave Ramsey]

years, never had anybody go back.

[Jade Washall]

No one's ever called back and said,

[Dave Ramsey]

dave, I hate you because you made me debt free because you told me to sell my car, and I don't have an $800 car payment, so I hate you. That is. That call I've not gotten. Now, I've got a lot of people that hate me for a lot of reasons. They're saying something, but, I mean, there's a long list of reasons to be pissed at Dave. And they're out there on the Internet if, you know, just type in Dave Ramsey sucks. It goes for days. And so, sorry, but that's not. But that's not one of them.

[Jade Washall]

That's. Listen, we let calls.

[Dave Ramsey]

I sold my car and I am debt free, and I hate Dave Ramsey. Is something we have never heard once.

[Jade Washall]

I've never even seen. I might go on the break and look on social media and see if there's any sort of hashtag about that. I guarantee it's not.

[Dave Ramsey]

No, there's not. There's not. And our social media team would have already told me. Yeah, I don't go look at it, but I'm afraid they do. And so testing it is good. Yeah. And here's the same thing with paying off the house. Those of you, I have $150,000 in my CD and I owe 100 on my house. Should I pay off my house? How many times have we taken that call? Oh, yeah, like 5 million times. And I'm like, pay off your house. And if you hate it, you can go get a mortgage and same thing you did. Just test it, test it. And you know what? Never. I've never heard anybody write me, hate me. Well, Dave, I paid off my house. I hate you. I've never had that one time. Now, there's a lot of people have all these theories about this. Sure, Dave Ramsey tells people to pay off their house and they're not going to be rich because of it. But then there's all these tens of thousands of millionaires that are millionaires because they paid off their house and took the mortgage payment and went and became millionaires. And there's one sitting in front of us right now from Houston.

[Jade Washall]

Yes, yes. Let me tell you. Yeah, hello. I had a guy, he had a pile of stocks and a bunch of debt. And you know, we would say, if you have stocks, sell the stocks, use it to pay off the debt. He didn't want to do that because he'd had the stock for quite a while. He'd had it since he was 18 years old. And I said, listen, I said, try it. I said, take a portion of the stock, just take a portion of it and pay off a portion of the debt and see how you feel. And he said, I never considered doing that. It was in his mind, it was an all or nothing deal. And because it was all or nothing in his brain, he chose the nothing. And so if you're on the fence, just try it. And you want to know what? He got ahold of me later and let me know. It felt so good I sold the stock and I ended up paying off the rest of the debt. Just let me know.

[Dave Ramsey]

I know lots of pastors that have said, try tithing for six months. If after six months you think that tithing is to your local church is wrong, I'll give you a money back guarantee on it. None of them have ever had anybody ask for their money back.

[Caller]

Wow.

[Additional Caller]

If you're looking for a more budget friendly way to save on medical costs and stay true to your values, Christian Healthcare Ministries is a great option to think about. CHM is not health insurance. It's a health cost sharing ministry. A biblical community based way for Christians to share each other's medical bills. That means no enrollment deadlines and you can choose any doctor or hospital you want. That kind of freedom is big, especially if you're self employed, between jobs or you just need something that fits your budget better. CHM has been around for decades, faithfully serving the Christian community and many members save hundreds of dollars a month compared to traditional health insurance. And that margin gives you breathing room when you're working the baby steps and trying to steward your money. Well. And right now, CHM is offering new members a 50% credit towards their first month of membership. Get [e-mail] budget and use promo code RAMSEY. That's chministries. And promo code Ramsey.

[Dave Ramsey]

Christian is with us in Fort Worth, Texas. Hi, Christian, how are you?

[Caller]

Good. How are y'? All?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller]

So I am a college student and I do have a little bit of credit card debt, but I also have a pretty big tuition payment coming up in June because I'm looking to transfer schools and I don't know the best way to go about this.

[Jade Washall]

Saving up for the tuition?

[Caller]

Yes. In June it'll be 15,000.

[Dave Ramsey]

Oh, boy. You have the money?

[Caller]

Yeah, Yeah, I have 11,000 saved up because I do work two jobs and I'm a full time student and my credit card debt is about 2,400. And so I don't know, it'd be better just to throw two grand out of credit card debt, then take a little loan out and student loans or save up to 15 the rest of the way and then pay that and then pay a little more the credit card debt when I can. After I make the payment, I would

[Dave Ramsey]

pay for the tuition in cash and not add, and not use debt ever again.

[Caller]

Yeah, because I've been paying for cash the last year for school, I paid about 1800amonth.

[Dave Ramsey]

So why 15,000 a semester?

[Caller]

So it's a. It's an online degree. And so I'll start in June, make the payment, and I'll be done by next June because I already have my associate's degree. And then this will be online course to get my bachelor's in biomedical sciences.

[Jade Washall]

Okay, so you're making this payment and then when's the next payment due? Before you finish or that's online.

[Caller]

It would just be just this one payment that's done off. The advisors have told me as well it's just the one payment. I don't know if they do payment plans or not.

[Dave Ramsey]

Okay, but so you're prepaying for the entire year?

[Caller]

Yes, sir.

[Dave Ramsey]

Okay.

[Jade Washall]

And you said you have 11,000 saved, so you're just solving for the 4,000, right?

[Caller]

Yes, ma'.

[Additional Caller]

Am.

[Dave Ramsey]

And he can have the 4,000 by June?

[Additional Caller]

Yeah.

[Dave Ramsey]

So pay cash for the tuition. No. So here's the thing. The trick to getting out of debt is to vow never to borrow again. You already have debt. So let's Just let that sit there. Pay minimums on that and save up and pay cash for this tuition and then work on the debt beyond that. Now, if you're doing online, are you going to be working full time at that point?

[Caller]

Yes, sir. So I work full time as a certified medical assistant and also bartender on the weekends.

[Dave Ramsey]

Okay, good. So that's where all this money's coming from. So you're gonna have the money to live during this year while you finish this up and go ahead and knock out the credit card debt.

[Caller]

Yes, sir.

[Dave Ramsey]

Look at you. Look at you. Well done. Yeah. Yeah. I wouldn't fool around. I'd pay cash for the tuition, not have anything lingering from that decision. And then the old decision that's still sitting there, come back and attack it as quickly as you can. You've got 15,000 in the bank.

[Jade Washall]

Do you know why, Christian, we're telling you not to go into debt further?

[Caller]

I did not know. No.

[Jade Washall]

Okay, let's talk about that. So because you've considered, obviously you've considered that you used it for credit cards. You considered it as a solution for your problem. Right now, the reason Dave and I are telling you, hey, draw a line in the sand. No more debt going forward is because debt eats at your ability to build wealth over time. It steals your hard earned income and causes you not to be able to do things like invest. Not to be able to do things like pay cash for emergencies. And that is a vicious cycle. That is why we're on the air, is because it creates a vicious cycle in people's lives and they can't get ahead.

[Dave Ramsey]

Yeah, exactly. Well done, sir. You are working your way through this. I like you. Well done. It's good to find people that work hard and achieve their goals as a result. Quinn is in Philadelphia. Hi, Quinn. How are you?

[Additional Caller]

Hi. I'm so excited to talk to you and Jade. So my question is about my employer, who's telling me that I owe them about $17,000 due to an error that they made with overpaying me over the past year and a half that I recently uncovered and brought to them.

[Jade Washall]

Oh, boy.

[Dave Ramsey]

You figured it out.

[Additional Caller]

Yes.

[Dave Ramsey]

And they want you to repay them.

[Additional Caller]

That's correct.

[Jade Washall]

And what.

[Additional Caller]

Yeah.

[Jade Washall]

What did they say? When do they want the money by?

[Additional Caller]

So they want the money by the end of this fiscal year, which is July, but then it's actually October because that's when we get our bonuses. So the error was. I came back from maternity leave in September 2024. I wanted to start work at 9am instead of 8. I'm a physician and getting there at 8 was just too hard. We have four kids, and so it was really just a couple days a week. I went from a 1.0 employee to 0.95 or like 95% effort, basically. I didn't notice the change on my paycheck back then. I really wasn't paying attention to anything. I was the typical doctor out of school with doc Itis. Came on a fellowship, thought I could, you know.

[Dave Ramsey]

So what is your total. What's your total income now? Document.

[Additional Caller]

So my husband and I together make about 420. I'm at like 4. Oh, it was 4. 40 prior to. Sorry. 240 prior to the change. Yeah. I didn't notice on my. My paycheck until recently. Last July we came back from our, like, fourth vacation and I couldn't pay off my credit card at the end of the month. And that's when I found. You read the total Manning makeover. Convinced my husband, although, like, I'm still convincing him some days, but we're actually two weeks away from paying off all of our debt except our house.

[Dave Ramsey]

Way to go.

[Additional Caller]

And going from two to three. Yeah. About $80,000.

[Jade Washall]

So the 17,000 accrued over the course of how many years?

[Additional Caller]

About a year and a half.

[Jade Washall]

About a year and a half.

[Additional Caller]

September of 20.

[Dave Ramsey]

$24,000 a month. And your. But your income? Substantial.

[Jade Washall]

You didn't even notice it.

[Dave Ramsey]

Yeah. So it's not. It's thousand.

[Caller]

Yeah.

[Additional Caller]

And I mean, I'm probably going to get a bonus about that much. I'm just like, I'm still upset about it because it is so much money. And like, right at that time, I'm going to be going from step. We're going to get out of step three in the summer. And that balance would really help us, like, kickstart steps four, five, and six. Yeah. So I'm having a meeting with them next week and I'm just hoping you can give me some advice. Going into the meeting, I'm wondering if I should talk to a lawyer ahead of time or just wait till afterward or if I have any, like, leg to stand on. I am, like, highly productive. They. They measure doctors, like, productivity based on how many patients you see. And I've looked back and there were many months that I was over 100% productive, basically seeing more patients than I had slots for.

[Dave Ramsey]

Yeah. So here's the thing. You can ask an attorney. I don't think you. I don't think you have a legal case. So I don't think that's the lens through which I would open it. If you want to gather the information, it won't hurt anything, but ask an attorney to learn that, because I'm not one. I'm trying. Okay. So if I had a highly compensated. And I do, I do have highly compensated folks on our team, and we made a clerical error that was amounts to 5% of their income or 10% of their income. Okay. Here we would say, oops, we screwed up,

[Additional Caller]

right? Yeah.

[Dave Ramsey]

And I wouldn't. And I wouldn't ask for it back. Okay. Because I'd be embarrassed that we screwed up. You didn't steal the money. You didn't deceive anyone. Quite the opposite. You're the one brought it to their attention. Hello. And so I would just say, hey, you know, I think it would be. If I'm in the meeting, I might say something like, guys, if you look at my productivity, it's well beyond 100%, which is very unusual on your staff. I brought this error to your attention. You probably would have never found it if it wasn't for me. You made the mistake. You should be embarrassed and you should consider just waiving this for all of those reasons. And now you probably don't be quite that. Belligerent, I was gonna say, but I mean, but that's the message, you know. Okay, let's, you know, I'm gonna be sitting with my boss and say, okay, boss, I'm one of your top guys. I brought you the error. And I wondered if you would consider being embarrassed about making the error and just waive it.

[Jade Washall]

You think? Yeah, listen, I think they should, but

[Dave Ramsey]

only, you know, I think it's a morale, an employee, a high productive, highly productive cause. Finding another doctor to replace you when you leave over $17,000. The thing is though, and they don't know that's not gonna happen, it's gonna cost em a lot more than that to fix the mess they made here. If they hold you to this. Cause you're gonna remember this forever. And the first time some other, some other group comes knocking, you're gonna be thinking about $17,000 instead of 800. $17,000, which is what the deal. I mean, don't be stepping over dollars picking up n.

[Additional Caller]

Buying a home is one of the biggest financial decisions you'll ever make. But too many people base the decision on opinions or what the market is doing that week.

[Dave Ramsey]

Churchill Mortgage has been our trusted partner for over 30 years because they do things the Ramsey way. A lot of people think buying a home Starts with going to a bunch of open houses. But if you're buying a home the right way, you start with a budget and a trusted guide like Churchill. Before you even think about house shopping, Churchill will show you the real numbers, not what a bank will approve. Buying before being ready is how people end up house poor and stressed out.

[Additional Caller]

Churchill will tell you the truth and they won't push you into more house than you need. And once you understand what you can actually afford, you can move forward with clarity and confidence.

[Dave Ramsey]

So if you're ready to buy a home, choose the right guide and stick to a plan. Go to ChurchillMortgage.com and get started. That's ChurchillMortgage.com this is a paid advertisement in MLS. Id 1591nmlsconsumerexess.org Eagle housing lender. Bridget's in Savannah, Georgia. Hi, Bridget. How are you?

[Additional Caller]

Good. How you doing?

[Dave Ramsey]

Better than I deserve. How can I help?

[Additional Caller]

Yeah, I was calling because my husband and I recently paid off about $24,000 worth of credit card debt.

[Dave Ramsey]

Good.

[Additional Caller]

And yeah, we're very excited about it, but that frees up about $600 to $700 a month for us. And we still have some medical debt that we were, of course, considering, you know, just quickly pay. But my sister actually lives overseas and we haven't seen her in two years. And I've since then had a whole pregnancy and a baby. So I would really like to be able to go over there and see her and introduce, you know, her niece to her. She can't come over here due to visa reasons, but I didn't know if that would be a bad idea and we should just continue with, you know, going with the medical debt route.

[Dave Ramsey]

How much medical debt have you got?

[Additional Caller]

About 6,000.

[Jade Washall]

How quickly could you have the 6,000 already paid off?

[Dave Ramsey]

24,000.

[Additional Caller]

Yeah.

[Dave Ramsey]

It's not like you're not going to see your sister for seven years. We're talking a handful of months.

[Additional Caller]

Yeah. The thing with the paying off the credit card, a large majority of it was due to a good tax return, so.

[Dave Ramsey]

No, no, no. There's no such thing as a good tax return. A tax return is when you overpay your taxes and they give you the money back with. That's not good. How big was the tax return?

[Additional Caller]

About 10,000.

[Dave Ramsey]

Good Lord. What's your household income?

[Additional Caller]

My husband brings in roughly 4800 and then I do a few contractor jobs and roughly bring in between 1200 to 2000.

[Dave Ramsey]

How in the world do you end up with a $10,000 tax return on a $50,000 income.

[Additional Caller]

I'm not entirely sure. My taxes. She has a tax business and was able to figure it out for us. But I do know we had a very high risk pregnancy and our son was admitted to the children's hospital for a few days that same year. So I'm not sure if that had anything to do with it. I don't know.

[Dave Ramsey]

Okay, stop. Number one, you need to get your crap together, and you do need to know someone else. Taking care of your taxes is how you end up not paying the proper amount of taxes, and you have no idea what's going on. I don't mind having someone prepare my taxes, someone does my taxes, but I'm going to understand how my tax bill works and why. And you need to understand this because if you have $10,000 too much coming out of your check every year, that's $833 a month. That should be in your check this next month because change your W4s so that you quit over withholding out your ears, and that will help you clean up the $6,000. No, honey, you should not go to Europe until you pay your $6,000. You should roll up your sleeves and finish the job. It's not like you're not like we're saying, don't see your sister for four years. It's four months, Bridget.

[Jade Washall]

This is what I'm concerned about. I'm concerned about when you told us you were very excited that you cleared out the existing credit card debt at 600 dol. But then you very quickly let us know that that was an anomaly and that let me know that you are not really ready to go on this journey. And I want to talk about this for a second, because when you decide you're going to work the baby steps, you have a moment in time where it's like, I have to. I'm setting. I'm setting the bar for what gets passed, right? I'm setting the bar for what my lifestyle must be for this to happen. And there's going to be a lot of things that are going to try to compete with the priority of. Of paying off debt, but you have to set a clean bar. We don't do anything.

[George Camel]

We're.

[Jade Washall]

We're cutting our lifestyle. We're not taking trips right now. And you're so early in the process, and you had a. An anomaly of a win, but you're already thinking about taking trips and you've got 6,000 to go. I would really encourage you to lock in because if you take a trip to Europe, then something else is going to pop up and you're going to go, ah, let's do that. And then something else is going to pop up and before you know it, you've been kicking the can down the road two years. So that's why this is so important.

[Dave Ramsey]

And if you emotionally rationalize and justify decisions that you know in your brain are wrong. Well, I haven't seen when you're, when you start doing that with your voice, that, that's when you know you're getting ready to do something stupid. Because I do it. I cannot. Because you. The drama queen that lives inside of our brains, all of us have one, you know, sounds like a beagle chasing a rabbit.

[Jade Washall]

You know, I've heard that, you know,

[Dave Ramsey]

it's just like your voice. Octave goes up and you. And you're like, well, I haven't seen. And all of a sudden you sound whiny. I do it. I do it to myself. I hear it in my own voice sometimes. I'm like, you are a whiner.

[Jade Washall]

Go back and look at any purchase you had buyer's remorse over and replay what went over in your brain.

[Dave Ramsey]

Exactly. The little whiner came out.

[Jade Washall]

Yes.

[Dave Ramsey]

And like I deserve it. I work so hard and I tell myself, you work so hard. You work so many years, you've paid a price.

[Jade Washall]

I deserve it.

[Dave Ramsey]

I deserve. As soon as you do that, and I'll guarantee you your octave always goes up one. Everybody does it.

[Jade Washall]

We all do it.

[Dave Ramsey]

And Bridget, you're doing it. So don't do that. Drop your octave back down and be like a grown up and go, you know, I still gotta clean up this stinkin mess I made. And then I'm gonna go see my sister.

[Jade Washall]

Yeah, flip the script. Let it motivate you to get there faster.

[Dave Ramsey]

Yeah, but you do whatever you want to do, Bridget. But you called and asked us. And we're always gonna love you enough to tell you the truth. And we're not telling you anything we haven't told ourselves. And we're not telling you anything we haven't told 5,000 other people before you called. It's fairly predictable what's gonna happen when you call the show. We're gonna love you so much that we're gonna be very truthful or even brutal with you when you call here. And that's because we want you to win.

[Jade Washall]

And in the end of the day, you'll have a better choice.

[Dave Ramsey]

The whole Ramsey brand is about trust. Because you trust us. Because we Love you enough to tell you the truth.

[Jade Washall]

That's right.

[Dave Ramsey]

And, you know, that's what this whole thing is about. And, you know, and then you get to hear the other side of it sometimes. And, you know, young guy that called last week, I don't know if you were on. I think Rachel was on the air with me. And he said, I called you when I was 22 years old, and you said, if you will do these four things exactly, and don't argue with me, do them exactly, you'll be a millionaire by the time you're 30. He said, I'm 28. Six years later and I'm a millionaire. And I called to tell you that.

[Additional Caller]

I love that.

[Dave Ramsey]

And it's like he said, I did exactly what you said to do. I didn't argue with you. Yeah. And he goes, and I got there two years earlier and you said I would. And I want to ask you about this other thing. And it wasn't a whining thing he was asking about. It was a legitimate question. But that was the preface to his question that he was calling in about, though. That's because if you do this stuff because we want you to be that story.

[Jade Washall]

Absolutely. Absolutely.

[Dave Ramsey]

And live like no one else so that later you can go to Europe when you want.

[Jade Washall]

And it's true, he said it. And she'll have a better trip for waiting and doing it the right way. But when you start to do the things we teach the way that we teach them, no holds barred, you do, you go faster than you thought you were going to go because momentum is on your side. And it's like the moving sidewalk at the airport. And that's my favorite part of it.

[Dave Ramsey]

Yeah, you're walking along and you're walking under your own power, and God looks down and says, oh, you're faithful with the little things.

[Jade Washall]

100%. Yes.

[Dave Ramsey]

If you're faithful with the little things, I'm going to give you more to manage. And so you're walking along and then all of a sudden you're moving like you're moving on the sidewalk faster than you're actually walking. So you're walking, but it's also moving under you, and you end up arriving at the point faster. Because when you're faithful with the little things 100% of the time, he gives you more manage. And please don't expect for him to give you more to manage. When you're unfaithful with the little things, disorganized, chaotic, immat, immature, impulsive. When you're all of those Things. And now we're not fussing at Bridget. We've moved on from Bridget.

[Jade Washall]

Yeah, we've moved on from Bridget.

[Dave Ramsey]

Just in case. Bridget, you know, we're not preaching at you, but preaching to all of us.

[Jade Washall]

But don't you think, Dave, that's the secret sauce behind this? Because I can say when Sam and I were paying off $460,000 of debt, looking at the Ramsey plan and going, you know what? This is biblically based. That means I can ask God, hey, help me do this, and then I can get a yes, because it's based on what he wants me to be doing anyway.

[Dave Ramsey]

God, your word says the borrower is slave to the lender. And then Jesus said, it's tough to serve two masters. So help me, Lord, help me out. Help me get out of this and give me some work to do.

[Jade Washall]

Here's the thing.

[Dave Ramsey]

I was gonna say, give me a raise at work. I will work for it.

[Jade Washall]

It's not gonna be a check in the mail.

[Dave Ramsey]

It's gonna be work. Yeah. This is not a random. The duck is not gonna fly in the window already cooked, but he will take you duck hunting and let you get a duck.

[Jade Washall]

Yes.

[Dave Ramsey]

And so then you get to pluck it and you get to cook it and eat it. So expect come in the form of

[Jade Washall]

more work, more opportunities, more work.

[Dave Ramsey]

Because the diligent prosper. You know what diligence is? That's excellence in the ordinary. Excellence every day. That's diligence. And those are who prosper. That's who gets a raise. That's who gets the promotion. That's who the competitor comes along and steals. If you work in a toxic environment where they don't reward diligence, someone who will look over there and go, well, you look at that and they will hire you away and you'll make more money than you've ever made in your life. Life because you were diligent.

[George Camel]

Dave, we got a lot of calls on this show where life happens. One day, someone's healthy, they're working, providing for their family, and then a curveball hits.

[Dave Ramsey]

You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes. Yeah.

[George Camel]

And that's why you've always said that having term life insurance from Zander is essential because it protects your family if the worst happens.

[Dave Ramsey]

Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook and that's long term disability insurance. Yeah.

[George Camel]

It's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive but can't work. So it replaces a large part of your income so the bills still get paid while you get back on your feet.

[Dave Ramsey]

Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it. But if not, Zander can help you find the right plan whether you're single or married. It's not optional. If you're going to be out of work for a while, then you need to make sure the money's still showing up.

[George Camel]

And that's why Zander is our go to. They make it super simple to get the right coverage at the best price. No pressure, no upselling.

[Dave Ramsey]

I've trusted Jeff Zander and Zander insurance for over 25 years and so is my family.

[George Camel]

So don't wait. It's fast, it's easy, and it could make all the difference. Go to zander.com or call 800-356-4280.

[Dave Ramsey]

Protect yourself, protect your income, protect your family. Welcome back to the Ramsey show in the Fair Winds Credit Union studio. Jade Washall, Ramsey personality, is my co host. Today. Roman is in Atlanta. Hi, Roman, how are you?

[Caller]

Hey. I'm doing okay. How are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So I inherited $100,000 and I'm likely going to get 60,000 more when the house sells. I paid off my $30,000 of student loans already.

[Dave Ramsey]

Good.

[Caller]

I just turned 23. I graduate in May.

[Dave Ramsey]

Wow.

[Caller]

What's your degree in a place I'm doing film and focus on like documentary.

[Dave Ramsey]

Good for you.

[Caller]

So but that's kind of like, kind of led me down this path to where like I've been looking at government a lot, like involved in government, documentary a lot. And I'm trying to get myself in a place where I can attend law school in 2027 and I plan to work and save until then. And I'm just like, I have family who's advising me to put like my money in like 50k in a CD and like 10 or Roth and like 5% liquid investments or 5 and liquid investments. And my bank is trying to get me to invest it with their financial advisor, but I'm just not sure to do with that money knowing that I'm going to have that big expense of law school coming up.

[Jade Washall]

How much is law school going to cost?

[Caller]

Well, I mean, if I Can. I'm aiming for UGA, which would only be. UGA is only $60,000 in total. It's $20,000 a year to attend that UGA, but, I mean, this is only a year away.

[Jade Washall]

What if you just let it sit in the High Yield Savings Account until you need it?

[Caller]

And I. I do have somebody tell me to do that, too. So I. I just don't know. I just don't know.

[Jade Washall]

Like I can tell you why I would do that. I would do that because knowing that this is really short term, I wouldn't want to mess around with any risk of investing it. I want to keep it pretty liquid because you're going to need it. I mean, you said this is 2027, I'm guessing.

[Caller]

Yeah, if I. If I applied now, it'd be 2027.

[Dave Ramsey]

You've not been accepted yet.

[Caller]

Yet. No. I. I still have to take the lsat, and I've been studying for that.

[Jade Washall]

Okay.

[Dave Ramsey]

Okay. So here's the thing. You have two pretty big hurdles to go to uga. You're gonna have to score well on the LSAT because UGA is tough to get into, and then they have to accept you.

[Caller]

Right.

[Dave Ramsey]

So there are two big blockers yet before this actually happens. So we don't know if it's gonna happen or not until we cross those two mountains, so.

[Jade Washall]

And you've probably got some backup schools there. Yeah. That you've considered. And the prices of those.

[Caller]

There's a lot of. Yeah, there's a lot of, like, good schools in Atlanta, too, like John Marshall and whatnot.

[Dave Ramsey]

But that you can afford to pay cash for.

[Caller]

Yeah.

[Dave Ramsey]

With this money. So you have 130,000 cash laying around between these all of these events. Did I understand that? Right after you paid off your debts?

[Caller]

Well, the 60 is still in a house that hasn't been sold yet.

[Dave Ramsey]

Yeah, but it'll sell. It'll be selling sometime. I mean, it's up for sale, right?

[Caller]

Yeah.

[Dave Ramsey]

Okay.

[Caller]

Yeah.

[Dave Ramsey]

Good. Okay. Well, the other people are trying to be. Your family's trying to be helpful. Your banker's trying to be a banker. So asking a banker what to do with money is like asking a dog if it's hungry. So, no, we don't. They're 100% of the time they have an opinion, and it's. Put it with me. So, no, we don't need a banker's advice on anything. No, thank you. Mom and dad mean well, and, Yeah, a Roth IRA with 7,000 of this is not going to keep you from having the money. To go to law school. If you're filing a tax return and making at least 7,000, that's not a bad thing to do. It's not going to make or break your life. The best investment, Roman, that you can make is to attend law school and pass. And then pass the bar. That's a better investment. That's a better return on the 60,000 than if you invested in mutual funds or real estate. Okay, so the 60,000 you're investing in the best investment I know of, which is you.

[Caller]

Right.

[Dave Ramsey]

And so I want you to, just like Jade said, just protect this money. And does it kind of. Does it kind of feel calm to do nothing? I think doing nothing is a really cool idea. Just park it in a high yield savings. Super boring. I don't have to worry about being sophisticated. I simply got the money sitting there making a few points while I get ready to go to law school. Ta da. And then just go have a good night's sleep.

[Caller]

Yeah, that does sound nice, Aiden.

[Dave Ramsey]

And then just tell everybody else, thank you for loving me. And I've just decided what I'm gonna do is concentrate on law school. And when I get out of law school, I'll be a lawyer and I'll make money. And I got plenty of time to build wealth with that. Cause 60 or $80,000 is not gonna make you wealthy anyway, Roman. I mean, they didn't leave you 6 million, they left you 60. So it's nice. I'm glad you got some. But everybody's acting like you hit the lottery or something. You did, but it was like a small ticket, you know, so. So yeah, just calm, calm, calm. One of the things, having too many choices in front of us, it gets confusing and anxiety goes up. Is that right?

[Caller]

Yeah.

[Dave Ramsey]

And so when I narrow my choices down and go, decision has been made, I'm going to do nothing on purpose. That's my decision. I'm going to park it in high yield savings. Super boring. I'm not going to lose it. It's going to be sitting there when I pass the LC at get a good score and get into uga. And then I'm going to head to Athens in the edge of the mountains of beautiful North Georgia and I'm going to be a lawyer.

[Jade Washall]

Yeah, that's right. Yeah. Doing nothing doesn't mean you're not being 100% intentional. You're still being very intentional.

[Dave Ramsey]

Intentionally do nothing. But the power of making a decision when there's too many decisions in front of you is the stress and anxiety drops immediately. Yeah, too many choices is very stressful. And so I just go, no, no.

[Jade Washall]

You know, I think that's what happens when people look at their money and they think, should I be paying off my debt? Should I be investing? Should I be saving for kids college? Should I be paying off my credit card?

[Dave Ramsey]

Like, and then when they, when we just say, don't do this one thing at a time and then do this and then do this, their stress level goes down and they go, execute.

[Jade Washall]

Yeah, it's a plan.

[Dave Ramsey]

Yeah, it's a plan. Work the plan. Work the proven plan. And so the proven plan here, Roman, is the best investment Roman can make is in Roman, and that is in training your brain so that it is more eligible for more income.

[Jade Washall]

Yes.

[Dave Ramsey]

And that is not dropping 100 grand in an independent film that you decide to go make. That's not what I said. Okay. Got a degree in film. No, it's not what I said. Invest in a trap record. I mean, you know, if you want to be a lawyer and you want to be a good lawyer, you can make a good income as a lawyer. That's a good thing. And Lord knows we need some good lawyers because there's plenty of dumb ones out there. So. All right, don't get me started.

[Jade Washall]

I feel like you, you almost went on a tangent.

[Dave Ramsey]

I just, I just self edited right there on the air.

[Jade Washall]

That was a good job, Dave.

[Dave Ramsey]

Good, good, good move. Yeah. You're so. Guys, anytime you're a college student or you have a college student and they say I have the money for tuition, should they invest that instead of a mutual fund? Always tuition. Assuming they're studying something that is marketable, don't get a degree in left handed puppetry or German polka history. You'll be a barista. Okay, that's not what I'm saying. What I am saying is get a degree that's usable in the marketplace and the knowledge that you put in your tool belt will make you valuable in the marketplace. That is the best retail return. The increased income over the remainder of your life when you properly do education on something that's relative in the marketplace is the best return on investment there is.

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[Jade Washall]

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[Dave Ramsey]

Matt's in Philadelphia. Hi, Matt. How are you?

[Caller]

You good? Thanks, Dave and Jay for taking my call. Sure. I got a quick question. I'm wondering when I should hire for my business. I'm a small mechanic, work on like, ATVs and motorcycles, dirt bikes, stuff like that. And I've been in business for about 15 years, kind of. I feel like I've hit my max. Like, I can't seem to get out of the groove of making the same each year. So I don't know if I should hire or if I should be doing something else else.

[Jade Washall]

Are you turning away work?

[Caller]

No, I'm taking as much work as I can. And in the past two years, I've actually opened my business up to like, repair for customers to, you know, bring their machines and I can repair for them. I used to just buy machines to come up and resell them. And that was such a, you know, such an overhead. And if they didn't sell for months, you know, it's just a lot sitting around. So I opened it up, up the past two years to work on other people's machines charging 75 an hour. And, you know, it trickles in and out. You know, I always have three or four machines I'm working on for customers. But.

[Dave Ramsey]

So if you hired someone, what would they do?

[Caller]

I would like them to do the basic stuff, like clean machines. You know, quick, just go over the machine, tell me what needs to be done on it, and then we can order parts or if they need to order parts, just the stuff that.

[Dave Ramsey]

Which would allow you to do more machines, but you don't have more work work.

[Caller]

Right, right. And so I just. I don't.

[Dave Ramsey]

After the past two years, can you get more work?

[Caller]

That's what I guess I'm trying to Figure out how to, how to get. Yeah, I opened a Facebook page and you know, started advertising that way and just getting my, my name out there, but you know, it's just so slow.

[Jade Washall]

Have you. And you're raising your prices at a, at the correct rate over the past 15 years?

[Caller]

Yes, like I said, I've only really started working on customers machines over the past two years and I started at 55 and now I'm up to 75 an hour.

[Additional Caller]

Okay.

[Caller]

So it's up there. You know, most, most big shops are like 110 an hour. So I'm under. I guess I'm under what big shops are charging, but it's just me, so.

[Dave Ramsey]

Okay. The big shops are dealers.

[Caller]

Right?

[Additional Caller]

Right.

[Dave Ramsey]

Okay. Is there any independent non dealer shop competing with you?

[Caller]

There is one that's like 10 minutes from me and his shop rate is 95, but he turns away a lot of work.

[Jade Washall]

Interesting.

[Dave Ramsey]

Wonder if he would send it to you.

[Caller]

That's. That. That could be a question I could look into.

[Dave Ramsey]

Yeah, I just stopped by and have a cup of coffee with him. Go. I understand you're turning away work. I'll take it.

[Caller]

Right. Should I offer him something like, sure,

[Dave Ramsey]

I'll buy you a steak dinner every so often.

[Jade Washall]

And in the meantime, I'd also be sticking to you.

[Dave Ramsey]

And if you send me $2 million worth of work, I'll send you on a cruise. Yeah, but I mean, you know, I don't know what he's. I don't know what this amounts to, but. Yeah, but you don't need to hire someone and then both of you end up bored.

[Caller]

Right.

[Jade Washall]

Then you're losing money because you're paying him, but you're not making any more yourself.

[Dave Ramsey]

You need to be making more money as a result of having hired the person. And that person is either because you're making money on the work that that person's doing, or you're making money on the work that you're doing that you weren't able to do because they're doing work you used to do either one. So you know, like our guy that our cfo, our chief financial officer does not create revenue here. But he keeps me from having to do all that so I can create revenue. And that's what you're talking about. So you need to create, but there needs to be revenue on the other side of the equation to justify hiring. And yes. Right. I would work on growing the business so that you do need the help so you can get some scale to it. Because today when you're A solopreneur like this. Matt, you're incredible. But for 15 years, you've just owned your job. That's different than owning a business. You know, you're on your job when. If you don't show up, the income stops. That's you own your job. But if you own a business, if you don't show up and the income keeps coming in, people keep working. So, like, when I'm not here, Rachel and Jade do the show, right? And so the revenue keeps coming in and I'm not here, so I own a business then. But if it's just me on the radio or on the podcast, and then I don't show up and there's no podcast, there's no revenue, then I just own my job. And so that's different. But the first step of business, and I'll send you a copy of my latest bestseller. It's called building a business you love. And it's the five stages of business. You're in the first stage of business. You just been there a long time. 15 freaking years. So. But the first stage is the treadmill stage, where we feel like we're stuck on a treadmill. We got no one to delegate to, and you just run, run, run, run, run, run, run. Collapse on the couch every night. What'd you do today? I don't know, but I did a lot of it.

[Caller]

And really tired.

[Dave Ramsey]

And so that's treadmill stage. And it's fun stage. It's an exciting stage. You do have control of your destiny. It's a nice. It's a fun part of that. But then when you start hiring people to do work when you're not working. Oh, now life starts to get good, assuming you get the right people. And you won't the first time. You'll have to fire them and get new people, but you'll finally find people that actually work. And they're out there. There's not many of them, but they actually work. And then you'll start to grow the business. So hang on. I'll have Christian give you a copy of the book building a business you love. Jason's in Toledo. Hi, Jason. How are you?

[Caller]

Hey. Good. Great to talk to you. Jane. Dave. Hey. So I'm trying to help guide my parents on their finances and helping clean up some things. The basic question is, hello.

[Dave Ramsey]

Did they ask you?

[Caller]

Yes, they did.

[Dave Ramsey]

How old are they?

[Caller]

They are both 79.

[Dave Ramsey]

Okay. How old are you?

[Caller]

I am 54.

[Dave Ramsey]

Okay, good. Okay, then it's possible they'll listen. That's why I Was asking. Okay, good.

[Caller]

Appreciate it.

[Dave Ramsey]

Yeah. When you answer questions people don't. Didn't ask, then sometimes, you know, don't help. But anyway. Okay. So you're helping them.

[Caller]

I waited.

[Dave Ramsey]

79 years old.

[Caller]

Yep. And the basic question is, should they pay off their home equity loan that they have or continue to pay that payment so that they have the cash that they have in retirement? They only have about 100 grand just so that they can have that on hand for medical emergencies. They'll probably never pay off the home equity loan before they pass. But then those, you know, that would come out of the proceeds of their house.

[Dave Ramsey]

What's the home worth?

[Caller]

Probably about 250.

[Dave Ramsey]

And how much is the HELOC?

[Caller]

So there's about 50 left on it.

[Dave Ramsey]

Okay. And that's the only debt, or is there a mortgage as well?

[Caller]

That is the only debt.

[Dave Ramsey]

Okay. And their only money is they have 100.

[Caller]

That's correct.

[Dave Ramsey]

And how much. What's their income?

[Caller]

They're fixed on Social Security about 44,000 per year. And we did a very detailed budget with them, came to about 40 per year in expenses. So that's close. But they think that they can maintain that long term with Social Security, but that's. That's all they got.

[Additional Caller]

Wow.

[Dave Ramsey]

Tight. Very tight.

[Caller]

Yes.

[Dave Ramsey]

Yeah, I agree. I would not use the hundred and only have 50 at 80 years old to pay off a $50,000 loan. But I really am scared. That loan is very destabilizing for the situation. So I do want to come up with some thoughts on how to get rid of it anyway. But, no, I would not use 50% of. Of the little bit that they have to clear this little bitty loan.

[Jade Washall]

Do they have any vehicle. Do they have any other assets that they could sell?

[Caller]

Not really of any significance? No.

[Dave Ramsey]

There's not a lake lot?

[Caller]

No, unfortunately not.

[Dave Ramsey]

Okay. All right. Are you the sole heir?

[Caller]

No, I've got a couple of siblings.

[Dave Ramsey]

Okay. How. What's the financial condition of you and your siblings?

[Caller]

We're decent. I don't know that any of us are in a position to, you know, sign together and pay that off for them.

[Dave Ramsey]

I would love for each of you to throw in 17k in it to go away.

[Caller]

Yeah, I don't. I don't think that that's probably going to be happening, unfortunately.

[Dave Ramsey]

Okay.

[Jade Washall]

How's their health, your parents?

[Caller]

It's okay. They're not, like, in dire health, but it's not great either.

[Dave Ramsey]

Yeah.

[Jade Washall]

My thought behind what Dave said is you probably stand to inherit the house, so it's money that you would get back.

[Dave Ramsey]

Yeah, that's a. That's the reason I did it. But if they can't come up with the cash, it doesn't matter. Yeah, yeah, yeah. It's not like. It's not like the money's going away. It's going away for a short period of time until they pass. And you sell the house. Yeah, I. I would sit right where you are. If you. But if you can figure out a way to pay it off also, I would. I would get rid of it because it's more destabilizing than. Your words make me think you think it's foreign. If you run a business, you already know this. Bad information leads to bad decisions. And right now, AI is everywhere. But AI is only as good as the data behind it. The best AI is built on the best data. That's why I recommend NetSuite. NetSuite is the number one AI cloud ERP and more than 43,000 businesses run on it, including us here at Ramsey Solutions. Their AI isn't bolted on, it's built in. And it connects everything that runs your business. Accounting, inventory, customer data, all in one place. Because when your numbers are connected, AI actually works like it's supposed to. NetSuite's AI helps flag cash flow problems, spot inventory issues, close your books faster, and cut down on manual reporting. If your revenue is at least 7% figures, go to netsuite.com Ramsey for a free product tour. That's netsuite.com Ramsey. Well, my least favorite subject.

[Jade Washall]

Let me guess. Taxes.

[Dave Ramsey]

Taxes. Just saying the word kind of pisses me off, but yeah, I just don't like it at all. But we're gonna talk about it. Cause you guys ask a lot of questions about it, especially this time of year. So, Jade, when are taxes due? Someone asks. And what if I'm late?

[Jade Washall]

Well, they're due on April 15th. That's the date. But you shouldn't be late. Because if you think you're going to be late, just file an extension. That's what I would say.

[Dave Ramsey]

But even if you file an extension, the taxes are still here.

[Jade Washall]

You still got to pay them.

[Dave Ramsey]

If you don't pay them on April 15, the penalties and interest begin.

[Jade Washall]

Oh, yeah.

[Dave Ramsey]

So the extension is not on payment. The extension you file is paperwork. The paperwork on the actual filing of your taxes. So you can file an extension to file your taxes, but you should pay them anyway. Pay what you think they're doing. They're going to start penalizing you that day whether you file an extension. Or not tax deduction versus a tax credit.

[Jade Washall]

I like this. So a deduction that's going to lower your taxable income, whereas a credit would lower the overall amount that's due. I like to think of a credit like a coupon. $30 off, 50% off.

[Dave Ramsey]

Yeah. And not many things are tax credits. Most things are tax deductions.

[Jade Washall]

That's right.

[Dave Ramsey]

So a tax deduction is $10,000 deduction means you reduce the income that is taxable by $10,000. And so if you're in a 25% tax bracket, that then would save you 2,500 on your taxes, because you don't pay taxes on $10,000 worth of income at 25%. So that's a tax deduction. And that's 99% of the time what we're talking about around here. Occasionally there's something that gives you an actual tax credit, which is dollar for $10000 tax credit. It reduces your tax bill.

[Jade Washall]

That's great.

[Dave Ramsey]

By $10,000. That is 75% better than a deduction. Okay. But yeah, not many of them out there. But there's a few things that you get tax credits for. Okay. This one blows people away. The number of people that don't understand this is like everybody. How do the tax brackets work?

[Jade Washall]

Yeah. So the tax brackets, they're a progressive system. So there is a range of income that is taxed at a certain amount. Your entire income is not taxed at the same amount. A higher bracket never means that you're going to pay that tax percentage on your entire income. So if you've never done it, go through and you can Google the tax brackets for the tax year and you can see how it's broken down.

[Dave Ramsey]

Everyone pays the same amount of taxes on the first 25,000. Everyone pays the same amount of taxes on the first 50,000. Even if you make 2 million, the first 50,000 is taxed exactly the same. And so then, so as you go through the bracket, when you jump a bracket, it does not jump your entire income by that percentage amount, only the amount above that last bracket. Okay. And so it might be that you have $5,000 above a bracket.

[Jade Washall]

That's right.

[Dave Ramsey]

And so it's hardly anything.

[Jade Washall]

So that's so good because a lot of people are like, I don't want to make more. I don't want to be in that bracket. That's crazy talk, you know?

[Dave Ramsey]

Well, there's not 100% bracket yet. So of course you want to make more because you get to keep it. There's not even a. There's not a. I mean, I think the max is what, 30 something percent. So you still get to keep 70 cents on every dollar no matter what you make. So go make more. Shut up.

[Caller]

Up.

[Dave Ramsey]

Yeah. So how much to set aside if you're self employed?

[Jade Washall]

All right, you always want to take 25 to 30%, set that aside for income taxes and just know that you'll likely need to make pay quarterly taxes. I like to do a quarterly estimate, set that aside. That way Uncle Sam has his cut.

[Dave Ramsey]

Yeah. The quarterly estimate is a one page document. How much were the revenues for my business, how much minus the expenses for my business equals the profit for my business times tax bracket. And you have to pay that once a quarter if you're self employed. If you don't, you're going to get penalties and interest on that after the first year. First year they give you a pass, which also leads people into doing stupid stuff like not paying their taxes. But you need to do your quarterly estimates. And it's really not rocket surgery to figure this out. It's not the that hard. So you just sit down and go, okay, the business made $100,000 and we spent $90,000. So our taxable income is $10,000 on the profit and we're in a 25% bracket. So I'm going to set aside $2,500 and I'm going to send that in to the, you know, in with my quarterly estimates. And then that has the same effect at the end of the year as those of you that have a W2 job where you're withholding automatically out of your truck check. The only difference is you actually have to send the money in, which pisses you off more. And so because you actually know that you're paying taxes when you have it withheld from your check, it's out of sight, out of mind. You don't think about it. So about a fourth. About a fourth of your profits. So if you're running a business, you're on a separate checking account. Whatever's left in that account, if you pay only business expenses out of that account, which is what you should do, and you only put business income in that account, which is what you should do. What's left in there is profit. Profit. And so if you pull $5,000 out, you should set aside 1,250 bucks and only pull 3,750 into your checking account and set aside 1250 so that when you're ready to do your quarterly estimates, you're Ready to do your quarterly estimates. Standard deduction versus itemizing.

[Jade Washall]

All right, so that's usually people's question, which should I do? And the answer is whatever is going to lower your taxable income. For most of us, the standard deduction is where we're going to sit. If you're just normal W2, not much going on. But the rent, I mean, if you're a married filing joint, that's $31,500 that they're deducting. And so that's where most people sit. Now if you own your own business and there's a lot going on and maybe you're working with a tax professional, they might say that itemizing is the way. But most people are going to fall in that standard deduction because it's easier, often higher. Only itemize if your expenses exceed that standard deduction amount.

[Dave Ramsey]

Yeah, exactly. Because you need, you know, that 31.5 married, filing jointly. If you don't have that much in write offs, then it's a reason, then you're better off. And here's how silly it is. Now with this huge amount of standard deduction now this 31,000, way high. It's now 91% of Americans do standard deduction. Now, if you do standard deduction, you are not writing off charitable giving. You are not writing off interest on your home mortgage. That's right, because you're taking a standard deduction and you're not itemizing. You only write those things off if you're itemizing. And so you say, I'm keeping my home mortgage because I get a tax degree.

[Jade Washall]

There you go, Dave.

[Dave Ramsey]

You lied. You lied to yourself. You didn't get a tax break because 91% of you so good did the standard deduction. Life changes that affect taxes.

[Jade Washall]

Yeah. So like I was saying before, most of us can maybe file our own taxes if we're doing, you know, normal W2. But if you've had a major change, maybe you got married, you had kids, you got a new job, you bought a home, maybe you entered retirement. All of those things definitely can affect your taxes. And after major life changes, just go ahead and review, adjust your withholding, decide if it's now good to work with a tax professional versus filing them yourself.

[Dave Ramsey]

Yeah. And that ends up, you know why your refund changes is those things, it's stuff like having a kid, buying a house, starting a business, stuff like that. Those are pretty big old divorces, deaths, all those things like that. Anything that's gonna cause your refund to change. Now, if you're constantly getting a refund. You need to remember Santa Claus does not live in Washington D.C. that is not free money.

[Jade Washall]

That's not the Disney fund.

[Dave Ramsey]

That's not the Disney fund. Walt Disney doesn't live there either. No one charitable lives in Washington dc. Everyone in Washington DC wants your money. They're parasite. They're a tick on the butt of America. They're parasites. They're sucking the blood out of you. And so do not think you are getting a blessing from Washington dc. If you got a refund, honey, it's because you had too much of your money taken out of your check. And then they send you your money back at the end of the year with no interest on your money. That's what a blessing DC is. That's what a blessing the IRS is. So you get $3,000 back. All that is is $3,000 of your freaking money because you had 250 $50 a month too much taken out of your check. Change your W4, stop having refunds. No more refunds.

[Jade Washall]

And it's so easy.

[Dave Ramsey]

Correctly calculate your withholding. Oh, I use the IRS tables. Wait a minute. You just assumed the IRS was competent. Well, that was a dumb thing to do. It's like saying the DMV is competent. No, no. You run your taxes out, you figure out what you're withholding should be be and get the proper amount withheld.

[Jade Washall]

A way to do that is look at your lax, your last tax refund. Divide it by 12, go on your W4. There's literally a line on there that you can decide what your withholding is. Change it.

[Dave Ramsey]

Well, we wish we could get to every call around here, but we can't. If you got a money question and you want it answered the way we would answer it, go to our website at Ramsey Solutions and use the Ask Ramsey tool. Ask Ramsey is our free AI tool that's built and trained only on Ramsey. So here's the way AI works. AI is pretty simple. It's going to regurgitate, spit out only the data that you put into it. Whatever data set you put into it is how it's going to make the answer. So if you're so stupid that you're Google and you put Reddit in the data set, then you're going to get stupid but answers like Google's giving you out of Reddit. But if you only put Ramsey, like three years of this show, all the transcripts into the AI tool, all of Financial Peace University, all the books that we've written, all the articles that are on Our website that we, the way we believe, the way we teach you into the tool, then guess what? That's the only data set it's got to work from. So it will answer the question exactly better than we would answer it here on the air because it's the culmination of all that data and it's free and it's blowing up, y'. All. People are hitting it like bing, bing, bing, bing, bing, bing, bing. Have an argument with your brother in law. Bing, bing, bing, bing. Ask Ramsey. I mean, he can. This is what Dave, this is what Dave and Jade would tell you right here. Ask your question today, Ramsey Solutions.com, click the Ask Ramsey tool. You're going to love it. It's completely free. Paul's in Tampa. Hey, Paul, what's, what's up?

[Caller]

Hi, sir. Thank you. Jade and Dave, you're a blessing to our nation. We really appreciate you so much.

[Dave Ramsey]

Thank you.

[Caller]

I have you. Thank you. I have a question. I see two. A couple principles that you've talked about are in opposition. In my life. I'm nearing retirement. I have the money to buy a boat in cash. We live near the water. It is going to be more than half of our annual income in boats, motors, wheels, etc. Which you say not to do. On the other hand, we have the money in cash and if we were to burn in the middle of our living room, it wouldn't be the end of our world.

[Dave Ramsey]

So what's your net worth?

[Caller]

About 4 million.

[Dave Ramsey]

And so are you counting the income that that 4 million would be creating or just your little, you're just counting

[Caller]

yourself 401k and real estate and the boat money is separate.

[Dave Ramsey]

No, that's not what I meant.

[Jade Washall]

He's saying to make the rule work.

[Dave Ramsey]

Number one, you're right. When you're in a no income, low income portion of retirement and a huge net worth, that rule does not apply. The half of your income in boats and motors and motors and wheels, that does not Rule does not apply. So if you're worth $10 million and all of your investment income is rolled back into investments and you don't count that income in the equation. And so you're, you know, you're living on a $70,000 pension or something, but you're worth $10 million, then we don't apply that formula. Okay, but if you take all of your net worth and use the income off of your net worth, you probably would. The formula would probably work, but we don't have to do that. How much is the boat?

[Caller]

About 400,000.

[Dave Ramsey]

Okay. And you have $4 million. So it's 10% of your net net worth.

[Caller]

Correct.

[Dave Ramsey]

And what is, how old are you?

[Caller]

60?

[Dave Ramsey]

50. And you're retired?

[Jade Washall]

66 years.

[Caller]

I'm 60. Okay.

[Dave Ramsey]

And what is, what is your income right now?

[Caller]

It's about 250.

[Dave Ramsey]

Okay. Yes, I would buy that boat. Okay. But that's based on the ratio into your net worth and based on the fact that you're. And again, if your Net worth was 40 million and you made 250, you know, you still could not buy the boat. If we only use the 50% of your income, but most people, we're not dealing with a net worth as substantial when we apply that formula. So yeah, I would buy this boat for sure. It's a sweet boat. What is,

[Caller]

is a trawler, a 40 foot trawler.

[Dave Ramsey]

Ah, triple engines or quadruple?

[Caller]

Double engines.

[Dave Ramsey]

Double what, what? Horsepower?

[Caller]

Yeah. Oh, slow. With a trawler, it doesn't go very fast.

[Dave Ramsey]

Oh, okay. All right. And what brand?

[Caller]

It's a great harbor.

[Dave Ramsey]

Oh, yeah. Okay. Yeah. And you're, you're what on the coastal water waterway,

[Caller]

we have access. Yes.

[Dave Ramsey]

Okay. All right. Wow. Good for you.

[Caller]

Yeah.

[Dave Ramsey]

I mean, you're in a position to

[Caller]

do that after all this hard work.

[Dave Ramsey]

Yeah, yeah. The bottom line is the reason that the decision makes sense is the other rule that you used is if I burn that much money in the middle of the floor, would my life change? And the answer is no. And that's because your net worth so high, not because your income ratios are correct on this. And so that's. If we were doing it off your income, you know, we'd be going, okay, $100,000 if you burn that. But if I'm in your shoes, I'm buying that. I would buy that boat. Yeah, that's what I would do. If you want a boat. I mean, it's a lot of money in a boat, but it's a small percentage of your net worth is tied up. And trawlers go down in value too, just like cars. Just like. I mean, 100% of boats go down in value.

[Jade Washall]

What's maintenance on a boat like that a year, you know?

[Dave Ramsey]

No, I don't. But it's, it's, it's the docking fees and the insurance and the gas and. Or the fuel. Probably maybe diesel, but I don't know.

[Jade Washall]

It's something, I'm sure he's considered that

[Dave Ramsey]

probably pretty substantial, but it's not hundreds of thousands on that because you don't need a Crew and all that on that thing. So he's the crew. 38ft long. I mean, it's not so. Yeah, but that's. Yeah. When you get into a thing where like Zuckerberg shot pulled up the other day. Yeah. Rachel was putting that up on her Instagram. Right. You know that sucker's got like 59 people or something on it. Yeah, just the daily rate to keep that thing running. Is a small city, but that's a different world. But again, as a percentage of his net profit worth. Yeah, it's nothing.

[Jade Washall]

Nothing.

[Dave Ramsey]

One of the wealthiest guys in the world, you know, so it's a 300 foot yacht that's probably worth, I don't know, a billion or half a billion, something like that maybe. And nothing for him though. And. Yeah, but again it's. He's got hundreds of billions.

[Jade Washall]

Yeah.

[Dave Ramsey]

And this is a half of one of them, you know, I mean, so it's, it's hard to get your head around when you're like regular people. But it's. If you, it helps you. If you just go. It's ratios. Look at the ratios. What ratio is this? What percentage of this? And it keeps you from saying stupid stuff. Here's what stupid people say that are envious. And I actually have said it, but I hadn't said it in 35 years. Yeah, about 35 years ago I quit being that stupid. No one should ever. That's redneck envy. Okay, okay, that's trashy. No one should ever have a car that nice. There's starving children somewhere. Like your car caused children to starve. Would you shut up? Unbelievable. Of course you should get that car. You live like no one else. Later you can live and give to the starving children like no one else. But these over saved people that think they're Jesus that are going to tell you that the only car you can drive and still be Holy is a 93 Camry. And that's the car of the evangelical. Anything beyond that, any car beyond that is not holy. And you're overspending and you're not a good steward. Oh, bull crap. It's actually not a Camry. It's an Accord because Jesus said it. They're all in one Accord. Dad joke. Okay, anyway, all right, I'm gonna let that slide. Just keep that one going. Just keep on moving past that. All right. But, yeah, but the, Seriously, I mean the judgment of other people's decisions.

[Jade Washall]

Yeah, it's, it's.

[Dave Ramsey]

Would you please manage your life? It's like a full time job to manage you it's like, you know, the person in your mirror is a problem child. Work on that one instead of working on fixing everybody else's spirituality. Jeez, some. Some of you people. So, yeah, that's the problem with stuff like this.

[Jade Washall]

It's a very small piece of stuff.

[Dave Ramsey]

So when I look out there and I see Zuckerberg's yacht, I go, not a big Facebook guy, but man, he killed it. Good for him.

[Jade Washall]

Well, I mean, how mad can you really get? Because how mad can you really get? You're probably on Meta somewhere. You're probably on Amazon.

[Dave Ramsey]

I probably paid for a few days of that thing to operate.

[Jade Washall]

That's what I'm saying.

[Dave Ramsey]

With the Facebook ads that Ramsey buys. So it's probably my fault, but. Yeah, but money well spent, Mark. You know, it's like you're living life large, so. But I mean, there's nothing wrong with it. I'm. Yeah, I honestly, I've never had, you know, 300 billion. So my mind can't get. My emotions, can't get my head around that. But it is throwaway money for him. And that's what we're keep talking about here. You know, work hard work. So when you're old, you don't have to work in McDonald's. You're not a Walmart greeter. Welcome back to the Ramsey show in the Fair Winds Credit Union studio. Jade Washall, Ramsey personality, is my co host today. Kelsey is in Seattle, Washington. Hi, Kelsey, how are you?

[Additional Caller]

I'm good. How are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Additional Caller]

So I have a question for you, of course, and I guess I'll just flat out say it. I feel like I either was or am being financially abused and I can't really tell. I'm very confused. We have a very complex financial situation. So where would you like me to begin?

[Dave Ramsey]

How old are you?

[Caller]

You?

[Additional Caller]

I'm 37.

[Dave Ramsey]

And how long have you been married?

[Additional Caller]

Seven years.

[Dave Ramsey]

Okay. And what's your household income?

[Additional Caller]

I'm not really sure because what is.

[Dave Ramsey]

What is complex about your financial situation?

[Additional Caller]

So we have a lot of debt and. But I guess we do have a lot of equity. We have numerous businesses and we just have money coming in and out and I'm just living on one credit card that is constantly maxed out and I never have access to cash.

[Jade Washall]

Why don't you have access to cash?

[Additional Caller]

I'm not sure. I have asked to be put on the account. My name isn't on anything and I have been asking and he seemed willing that we were waiting Because I never got my name changed because we got married during COVID So I did get my name changed, finally my last name. And then. So he was telling me that he was waiting for that, but now let's change. You know, my name's still not on anything. None of the properties, none of the accounts. So he. He tells me that the financial situation is so complex that I just wouldn't understand it, which frustrates me because I'm very organized and I have always paid bills on time.

[Jade Washall]

Do you have children together?

[Additional Caller]

Yes, we have a blended family of five. We have two 18 year olds, a 16 year old, and then together we have a four year old and a five year old.

[Dave Ramsey]

Do you work outside the home?

[Additional Caller]

No. And I have been. Yes, before we got married. And it depends, I used to make. I would just say on average I used to make like 5 or 6,000. But then there was a time where I. I switch jobs, so I was making significantly less.

[Dave Ramsey]

What did you do for a living?

[Additional Caller]

So I was a nursing assistant. And then I.

[Dave Ramsey]

How does it feel when someone says you're too dumb to understand this?

[Additional Caller]

It's really frustrating because I know, because I have been homeschooling our kids as well since we got married. So I mean, I'm really organized. You have to stay organized to have this many kids in homeschool.

[Jade Washall]

Frustrated. Frustrated is a word that describes when you're trying to do a task and you can't get traction on the task. Yeah, I don't know that that's the right word to describe what Dave asked.

[Dave Ramsey]

Yeah. When someone says you're too dumb to understand, that's demeaning.

[Additional Caller]

Yeah.

[Dave Ramsey]

I can't think in 43 years I've ever told my wife she was dumb. I think that would make me dumb. I think that would make me feel dumb.

[Caller]

Dumb.

[Additional Caller]

I think he just said it was very complex.

[Dave Ramsey]

No, it's too complex for you to understand, darling. But I got it because I'm the smart one. He's an arrogant butthole.

[Additional Caller]

So we have about 4.3 million in equity.

[Dave Ramsey]

How do you know?

[Additional Caller]

Oh. So last year I really started pressing. I wanted to have transparency and clarity on our financial situation. And I slowly have been asking questions and putting stuff together so that.

[Jade Washall]

Let go back there. When you say slowly is the purpose of the slowly for your own understanding? I'm just building this mentally piece by piece so I'm understanding it. Or is the purpose. Or is the purpose of the slowly? I can only ask him so many things at once before he shuts Me down. So I'm just gonna do a little bit here, then wait five months and do a little bit here. Tell me the purpose of that or is it a little of both?

[Additional Caller]

I think it's a little bit of both. If I did sit down and ask a list of questions, I'm sure he

[Caller]

would tell me, okay, did you get a prenup?

[Dave Ramsey]

Did you sign a prenup?

[Additional Caller]

No, I didn't.

[Dave Ramsey]

Okay, you got to decide how much of this you're willing to put up with. You've already put up with way more of it than you should have, I think so. If it was at my house, this would be over. Today. We're going to sit down and go, bubba, you got 24 hours to put everything out on the table. And I'm going to understand every bit of it and it's your job to make me understand it. And I'm going to have access to all the accounts in the next 24 hours or I'm going to go see a divorce lawyer and I'm going to have a two million dollar net worth because I'm taking half of this crap.

[Additional Caller]

We have $2.9 million in debt and loans.

[Dave Ramsey]

I thought you said you had equities of $4 million. Even still, you know what equity is.

[Additional Caller]

I guess I didn't. I just figured that I would subtract the loan amounts and the debt.

[Dave Ramsey]

Now the amount of the value minus the loans is the equity.

[Jade Washall]

But honestly, that's a little bit beside the point. The point, the biggest point is I'm

[Dave Ramsey]

taking half of it.

[Jade Washall]

Yeah, because you're not being treated.

[Dave Ramsey]

Because I'm getting a divorce. Because I'm tired of you screwing me over and treating me this way.

[Additional Caller]

Well, also, I think the biggest dynamic is I had come to realize that he's not paying for my needs. But, but. So he has a daughter from a previous marriage that he adopted or actually wasn't a marriage, it was an engagement.

[Dave Ramsey]

It's not anything to do with it.

[Additional Caller]

No, it is.

[Dave Ramsey]

No, it's not. Because you got. You need to know everything that's going

[Additional Caller]

on in the next 48 hours that he's been giving.

[Dave Ramsey]

That's fine.

[Additional Caller]

Her large amounts of money on the side that I was just fine.

[Dave Ramsey]

There's a lot of. He's been doing a lot of. A lot of crap.

[Jade Washall]

And you're going to find out more

[Dave Ramsey]

that we're not going to put up with in anymore starting today.

[Additional Caller]

But I did confront him about it.

[Dave Ramsey]

Oh, you're useless. No wonder you have this problem. You can't stay on task. I'm trying to give you a simple thing. The simple thing is the overall way you're being treated needs to stop immediately. And then you go down these different rabbit holes 14 times. I can't even have a conversation with you.

[Jade Washall]

No wonder the first question you asked is I don't know if I'm being financially abused. The answer is figure that that out.

[Dave Ramsey]

Yes, the answer is yes and yes, you should do something about it. And. And not one off every little stupid thing you're talking about here. It's the overall thing. A hundred percent of everything that's going on, I'm going to know it and I'm going to have a vote in it starting today or I'm going to see a divorce attorney.

[Additional Caller]

Yeah.

[Jade Washall]

And hear us, Kelsey, we're on your side. We're trying to be on your side because we agree that the behavior.

[Dave Ramsey]

You're like a dog chasing its tail, girl.

[Jade Washall]

Yeah. You're worth more than.

[Dave Ramsey]

You're circular with this. You can't even have a discussion about it. I think you've been living in this toxic mess so long that you're clouded on. Everything's just circular. No, it needs to be very clean and crisp and either we get this healed or we end this. You decide. That's what I would do if I were in your shoes.

[Caller]

Foreign.

[Dave Ramsey]

But your money's never going to return the favor if all you do is hope for the best. If you're ready to learn how to make your money work for you, check out the SmartVestor program. SmartVestor can help you find advisors who specialize in retirement planning, charitable giving, advanced investing strategies, and more. Whatever your goals, your pro will take the time to explain your options so you never have to invest in anything you don't understand. Head to ramseysolutions.com smartvestor to get connected. Ramsey Solutions is a paid non client promoter of participating pros. Learn [e-mail] SmartVestor. We use a couple of terms around here that sometimes are confusing, so let me clarify them. We use the term financial infidelity, which is when someone lies to their spouse and hides financial things like debt. And so it's a breach of trust like sexual infidelity is. But the fact that we call it financial infidelity does not really put it in the same category as sexual infidelity. Sexual infidelity is much more traumatic. Both are a breach of trust. One is a less traumatic breach of trust. But we use the term to describe the fact that It's a breach of trust. Another term that we use around here is financial abuse. Probably not accurate a lot. Okay? Abuse is like domestic violence. When someone's beating the crap out of their spouse, that's real abuse. Okay? So financial abuse, where you don't have access to the numbers is not as traumatic as actual abuse. And so when we use the term financial abuse, it's. It's not real abuse. It's a descriptive term to say you're in a situation where you're not being treated right. That's different than abuse. But in our culture today, overall, we have taken some of these words and we've used them so flippantly that we forgot what they actually mean. And so anytime I disagree with someone, I call them a narcissist. Well, you need to actually understand what a narcissist is before you say that. Because just because someone hurt your feelings doesn't mean they're a narcissist. And just because you've. We use the word abuse doesn't mean that it's descriptive of what is going on at the trauma level. Okay? Yes, it's a toxic and horrible marriage, a bad relationship. That's way different than real abuse. So we're guilty of participating in, overstating, over, dramatizing some of these things like financial infidelity or financial abuse, as if it was as bad as infidelity or real abuse. It's not. Okay? So when you call us up and say, am I being financially abused? It's way different than if you call us up and say, my husband's hitting me. Totally different reaction here. Because different parts of the way you deal with trauma in those situations is completely different from a psychological viewpoint, from Dr. DeLoney's insight and input on this. Way different. So if you call me up and say, I'm in an abusive, physically abusive relationship, I am not going to shame you. I'm going to walk you out of that and get you some help immediately. Because shame is one of the tools that's used by physical abusers. But if you call me up and say, am I being financially abused? And then you give me 16 different stories, worries, I'm gonna call you out on your inconsistency. And that's not me abusing someone that's being abused. Cause they're not actually being abused. They just don't have insight into the money and don't know what's going on with the money. So it's not actual freaking abuse, but it is a toxic, horrible marriage. And yes, she does need to stand up and put an end to the bullcrap. But that's just basic relational advice, not someone that is actually being abused. Now she's actually being abused. She's gonna get a different reaction from us on this show. And so if you don't like how I handled the last caller, kiss my butt and go listen to a different show, okay? Cause that's the way we do it here. We love people. We love people well, and we tell them the truth. So that's how that goes down. All right. Duke is in San Francisco. Hi, Duke, we're. What's up?

[Caller]

Hi, Dave. Hi, Jade. Thanks for taking my call.

[Dave Ramsey]

Sure. How can we help?

[Caller]

Yeah, so about three weeks ago, I got caught up in all the tech layoffs, and I lost my job, and I have enough cash to pay off my mortgage, which I was planning to do in November anyway, but now I'm wondering if I should just hold on to that cash.

[Jade Washall]

Yes, for now.

[Dave Ramsey]

How much were you making, Hun?

[Caller]

The last year was 630.

[Dave Ramsey]

Whoa. What do you do in the tech world?

[Caller]

I'm a web engineer, mostly focused on digital accessibility, which is making sure software works for people with disabilities.

[Dave Ramsey]

Yeah, big deal. That's a big field.

[Jade Washall]

Okay, so what do you have?

[Dave Ramsey]

What's the outlook for the new position?

[Caller]

Well, it's kind of a rough job market for what I do right now, so I don't know how long it would take. But I'm also contemplating on stepping out on faith and starting my life business.

[Dave Ramsey]

Doing what?

[Caller]

Same work, consulting.

[Dave Ramsey]

I wouldn't step out on faith. I'd step out on facts. Okay, but I mean, you know how to do what you're doing. Do you think there's a market for it? That you could build up enough consulting gigs to make what, anywhere near what you used to make?

[Caller]

It probably take me a while to get up to that amount, but, yeah, there's. There's more than enough work, I think.

[Dave Ramsey]

Okay. And do you plan to live in San Francisco?

[Caller]

I don't think I'll be able to stay here too much longer.

[Dave Ramsey]

Okay, then why would you pay off the house? Let's put the house up for sale.

[Caller]

Well, that's certainly an option that I haven't thought about.

[Dave Ramsey]

If you're leaving, you don't need to keep it. Yeah, and then that changes the whole formula, Right? Because you may be buying a property that's twice the size and half the price price in a different market, more affordable market. You're in one of the most expensive real estate markets in the World. You know that, right?

[Caller]

Yeah.

[Dave Ramsey]

Yeah. And so if you're going to. I. I don't know where it's best for you to operate this consulting firm from.

[Jade Washall]

I was going to say, what's your timeline for making that choice on whether or not you're going to step out and do your own thing versus continue to search the job market?

[Caller]

I give myself probably about 2 months before I need to start looking.

[Dave Ramsey]

You need to start looking now. What are you gonna do? Sit on your butt until then? What do you mean?

[Caller]

I needed to take a break.

[Jade Washall]

Okay, so how much money are you gonna break?

[Dave Ramsey]

They just gave you one. But while you're on break, look for a job, honey. I mean, for real. Anyway, that's what I would do. Set yourself a timeline. And what I would do is nothing with the money to answer your question and say, okay, for the next two months, I'm gonna look for a job. If I don't land something, I'm gonna launch the consulting firm and we're gonna move from San Francisco to fill in the blank of the name of the city. And that means the house goes up for sale that day. But in the meantime. Yeah, you're. You might land something there and stay in Silicon Valley, right?

[Jade Washall]

Yeah, you could do that. Or my whole thing. If I were in your shoes, I would set a timeline. If you're going to take a break, I guess that's your business. But I would set a timeline and say, if I haven't found. If I want to look for a job but haven't found1 by XYZ Date, this is what I'm going to pull the trigger. Trigger on the next thing that I want to start on my own. And in the meantime, you could start doing research on that just so that you're using that time very, very wisely. That's what I would do. It sounds like you have plenty of money laying around to kind of take a little bit of time on this, But I wouldn't get reckless.

[Dave Ramsey]

Yeah, exactly. Yeah. Good question. Duke. I'm sorry you lost a great job. I'm really glad that you had a great job like that. And so you know what it feels like to make 600 a year. That's pretty incredible. Incredible. And I'm really glad that you'll know what that feels like again someday, either as owning your own thing or staying there and just working for a different shop now and so forth. But, yeah. Wow. Wow. And it's pretty incredible that. Well, that's. That's awesome. So, yeah, you got the good News is you got options because you've done a good job of putting things in place.

[Jade Washall]

He sounded like a single guy too. He didn't sound like there was anybody else's.

[Dave Ramsey]

The words he was using didn't sound like. Yeah, but yeah, he's been working all the time. Exactly.

[Jade Washall]

Sounds like he's working day and night 24 7.

[Dave Ramsey]

Yeah. And then all of a sudden it came to a screeching halt. There we go. Yeah. So that's the thing. Yeah. So when you're in the middle of a storm. Yeah. Wait till the storm passes to do permanent planning.

[Jade Washall]

I think so, yeah.

[Dave Ramsey]

In the middle of the storm you do temporary things, which is like he said, hold on to the cash. We're not going to pay off the house because we may not be staying in the house.

[Jade Washall]

We don't know what's going to happen. That's right.

[Dave Ramsey]

Not be staying in the. Might be staying in it. Once the decision is made that we're staying here, then I would pay it off.

[Jade Washall]

Yes, I would. Too quickly.

[Dave Ramsey]

Yeah. If you say, all right, I'm staying here and I'm going to open the business. Okay. Or I'm staying here because I just landed another job making 400 in Silicon Valley and we're staying. Okay. Either one of those is fine.

[Jade Washall]

Yeah. Very cool thing to pay off a house in San Francisco.

[Caller]

Sam. Foreign.

[Dave Ramsey]

You spend hours researching before making a major purchase like a home or car. But it's also a good idea to put in the work searching for the right insurance coverage to protect your biggest assets. I recommend using Ramsey Trusted Pros. Whether you're looking for car, home or any other type of insurance. Ramsey Trusted providers have been coached and vetted to serve you like we would. Find what you [e-mail] insurance. The Ramsey show question of the day is brought to you by why Refi defaulted? Private student loans don't define you, but dealing with them does. Y Refi helps you refinance into a low fixed rate payment that you can afford. So you take control of your money and you get back to work in the baby steps. Go to yrefi.comramsey that's the letter y r e f y.com Ramsey might not be in all states.

[Jade Washall]

Okay. Today's question comes from Alex in Florida. They say my reoccurring bills are paid for on my credit card, which I also use to buy things throughout the the month. I pay the balance in full before the date is due. I'm retired, in my 50s with a net worth of 1 million and I have no debt. I drive a 15 year old Nissan. My question is, if my goal is simplicity and convenience, what's wrong with using my credit card for monthly spending and recurring bills? The balance usually runs between 1500 and 2000. Nothing crazy because I live very frugally. Okay. So if I look at this question, my thought is you're probably doing it for the points. You didn't say why other than simplicity. But there's gotta be something linked to that. And so I would say if there's a points argument here, I mean if you just did the math, it's really minuscule. I mean we're talking about 15 to $2,000 per month. If you look at points, maybe that's 300 bucks a year, you know, $330 per month. So there's really no financial gain. There is. That would be my first thought towards that. But I think what's really going on is, and I'm saying this out of love, but they won. Like they got you because that whole industry, what they want to do is move your mindset from being independent to dependent. And they got you because you've decided that in your mind debt equals getting a ahead.

[Dave Ramsey]

My goal is simplicity and convenience when in reality I use a debit card for my recurring and I use debit card for purchases. And that is more convenient and more simple.

[Jade Washall]

That's what.

[Dave Ramsey]

Yeah, because I don't have to pay a bill at the end of the month.

[Jade Washall]

Yeah. If you think debt equals simplicity, they got you.

[Dave Ramsey]

Even if you're paying it off at the end of the month and not in debt, you know, if you're paying it off in full, you're still, it's still not the simple, simplest way. Well, and the simplest way is a debit card.

[Jade Washall]

Yeah, we, the studies show that if you use a credit card, you will over time spend 10%, 30% in some cases, depending on what it is that you're purchasing, up to 100% more using a credit card. Things like fast food, things like entertainment, you are up in that high percentage of how much more you'll spend.

[Dave Ramsey]

Yeah. And I don't think this guy's gonna be in that super high percentage. Cause he's a frugal guy, so he's like 15%. But if you're just doing your normal purchases, you're going to spend a little more. But the big thing is you're paying it off at the end of the month anyway. So what's the difference in a debit card? Oh, one extra step, it's not as simple.

[Jade Washall]

That's why I said it's a mindset thing. In his mindset, they got you.

[Dave Ramsey]

They got you is right. They talked you into believing this was smart somehow and then you defend it with all of your numbers.

[Jade Washall]

But, yeah, I don't think I'm going to talk you out. I don't think I'll be able to talk you out of it because I think they got you.

[Dave Ramsey]

Yeah, I think. I think they got you. But, yeah, your argument is invalid. It is not simpler or more convenient than using a debit card.

[Jade Washall]

Nothing is easier than I get my paycheck and I take my paycheck to pay for my things.

[Dave Ramsey]

Yeah, well, or I use my debit card. I mean, like a lot of my utilities on stuff, on odds and ends, like personal stuff, like utilities automatically hit the debit card or some of the odds and ends and I don't have to do anything. It hits his credit card and he has to pay the bill off at the end of the month. Yeah, I don't have to. I don't have that extra step. So it's not simpler or more convenient.

[Jade Washall]

And I want to say this because I think that this is a very subtle thing that's worth saying. This guy. Do I think this guy's going to end up in debt?

[Dave Ramsey]

No.

[Jade Washall]

Is he going to end up on the side of the road? No. I'm not being a fatalist in any way. He's going to go about his life, he's going to be fine. He's going to retire. No. No problem. My problem is the mentality of it. The borrower, slave to the land lender. So at the end of the day, I want to be able to have as much freedom and autonomy in my life to know, hey, I. I actually went out in the world. I made a living. I didn't have to depend on a system of debt to keep me afloat or make me feel like I was something. That's all it is. But that's a big thing.

[Dave Ramsey]

Agreed. Margie's in Dallas. Hey, Margie, what's up?

[Caller]

Hi.

[Additional Caller]

Thank you for taking my call. Sure.

[Dave Ramsey]

How come?

[Additional Caller]

I've had a lifetime of bad decisions and have sucked myself into a hole into debt. And I'm debating whether to file bankruptcy to try to settle some things out of pocket myself. When my house sells, I'm going through a divorce and I know I'm getting 50% equity and I just don't want to continue making bad choices. So I just kind of need some guidance as to what route I should take and where I should prioritize.

[Dave Ramsey]

How long are you married?

[Additional Caller]

30 years.

[Dave Ramsey]

Oh, baby, that's tough. Wow. Wow. I'm sorry. A lot going on with you. A lot of pain. How much debt do you have, Margie?

[Additional Caller]

Total for myself not include my husband

[Caller]

and I have always kept our finances separate.

[Additional Caller]

So just my debt, including the mortgage. Because my name is on the mortgage.

[Dave Ramsey]

Your debt not counting the mortgage. What do you have?

[Additional Caller]

Okay, well it's 609 total, minus 343 for the mortgage. So whatever that leave, I've got 108 in unsecured credit cards. I have 137,000 in student loans and I know bankruptcy won't erase the student loan, so I'm stuck with that and I'm good with that. I got my, I got that, I'm going to pay that.

[Dave Ramsey]

So I'm sorry, that is heavy. Yeah, that's the same a lot. And what do you make?

[Additional Caller]

87,000.

[Dave Ramsey]

Okay. And how much equity will you get from the sale of the home?

[Additional Caller]

So the house would probably sell for 440 to 480. We owe 343 and so my half, I'm thinking after closing would probably be about 50k.

[Dave Ramsey]

Okay, well, bankruptcy is not going to work work for you because when you go to file, there's two types of consumer bankruptcy. There's chapter seven and chapter 13. Chapter seven is the clean slate where the student loans are not bankruptible, but the credit cards get zero. And in order to file a chapter seven, you have to pass what they call a means test, meaning they look at your income and any assets that you have and when they see you have $50,000 and make $87,000 a year, you're not going to pass the means test. So you're going to be forced into a payment plan in chapter 13, which is five years, 60 months of paying payments on the credit cards. You put the student loans in there too, but they get paid in full. The credit cards can be paid all or portion of in chapter 13 in your case, they're going to get most of it anyway. So are you Delinquent on the 108 on credit cards?

[Additional Caller]

Yeah, I stopped payments in January.

[Dave Ramsey]

Okay.

[Additional Caller]

That was part of, you know, being able to afford an attorney.

[Dave Ramsey]

Yeah.

[Additional Caller]

For the divorce. And so honestly my thought process where I, where I wanted to do is wait for the sell of the house and then just start calling creditors and say like, hey, I think you can,

[Dave Ramsey]

I think you probably settle the credit cards for the first 50 or something like that. Okay. If they went seriously delinquent, they're not seriously delinquent yet. And it'll be a long, it'll be a year and a half. While your heart is broken over a 30 year marriage ending and you're trying to get a fresh start, you're going to have a lot of work to do here. I've got another idea. The guardian litigation people that we work with, this is what they do. They negotiate with them when you're, when you're in default. And they're very, very good at it. I just had lunch with the CEO the other day and was listening to their whole process and I think they can take care of you. And we'll help them do that because you are in a pinch, all right? And so we're going to, we'll hook you up. Christian is going to get in touch with them and hold your hand and walk you right into them. And I think they can walk you through this because you're not going to qualify for a chapter seven. It's going to put you into a 13. And so some kind of a payment plan or settlement process is going to be better for you outside of bankruptcy. It's going to be more efficient. And it doesn't require all of your emotions to deal with the anger and the crap that the collectors are going to throw at you if you do it yourself. And if I'm in your shoes, I don't need that right now because your heart's already breaking. So hang on and we'll help you with this Hunt. Dave Ramsey here. Most people stay stuck with their money because they're not paying attention to it. Most people are living paycheck to paycheck, stressed out and broke. Don't be most people. You work way too hard to be broke and feel broke and you deserve to have something to show for it. That's why we built the Every Dollar budget app. It gives you a personalized plan for your money that shows you how to free up extra money every month and use it to beat debt and build lasting wealth. Plus, you get real coaches guiding you through your plan step by step. Look, most people hearing this will just keep hoping something changes, but not you. You're ready to make change happen. Starting now. Go download everydollar in the App Store or Google Play and start for free today. Our scripture today, Proverbs 21, 21. Whoever pursues righteousness and kindness finds life, prosperity and honor. Warren Buffett. You only have to do a very few things right in your life. So Long as you don't do too many things wrong. Guys, Ramsay is taking over an entire cruise ship. That's right. One of the top lines. Holland America Fancy Pantsy Cruise line. Not the cheap ones. This 20. This is a 2500 people coming together for the ultimate debt free celebration. If you're on baby step four and beyond, you're out of debt except the house. And you're working on getting out. You're working on getting your emergency, I mean your pasture emergency fund. Working on getting your retirement bill and getting the house paid off. All that or even beyond anywhere. This is for you. We're not asking you to spend money while you're on baby step two and go on vacation with us. But we, but let me tell you, we'd love to have you on this. All the Ramsey personalities are going to be on there for seven days including me. My wife Sharon will be with us the entire time. We're going to have new wealth building teachings. We're going to join the world's largest debt free scream. We're going to watch live episodes of your favorite Ramsey shows be taped right there and so much more. So you get all kinds of opportunities to deal with every one of us. And we're going to be all over the place. We did this last year. It's going to be one month, one year from right now. Be in March of 2027. It is. Well, it's not sold out but it's getting close already. So if you want to go click the link in the show notes or go to ramseysolutions.comevents to book your cabin. Laurie is with us in Salt Lake City. Hey Laurie, what's up?

[Additional Caller]

Not much. Dave, I'm so excited. Thanks for taking my call.

[Dave Ramsey]

Sure. How can we help?

[Additional Caller]

So here's my question. I think we went to stupid university and made a mistake and I'm just wondering what you would do. In our case, we bought our home about a year ago and when we bought it, we understood it was seller finance. But the day we went to sign the papers, like we didn't hire a of lot lawyer in advance. That was probably our biggest mistake. When we got there, it turns out it was more of like a seller take back. Like they didn't give it to us with their money. They are using the loan they previously had. I did not realize that was like weird. So would you be concerned if you were me? Like would you go refinance?

[Dave Ramsey]

I don't understand. What do you mean they're using the loan they previously had?

[Additional Caller]

What do you mean they didn't pay off the home home with the money that we gave them to? Okay, so we paid like a 1 million dollar home. We paid 750, but still owed that extra like 300ish. And they just kept the loan they previously had. So they're not financing it out of their money.

[Dave Ramsey]

What, what is the balance on that loan?

[Additional Caller]

So the balance on their loan is 320 and we owe them 380. So we borrowed $60,000 from them and then like overall balance is 320 on the house.

[Dave Ramsey]

Is the house been put into your name?

[Additional Caller]

Yeah, we have the title, so that's right. I thought we were all above board, but then I looked at it today online and it said it was a seller take back loan. And I was like, I've never even heard of that before today.

[Dave Ramsey]

I didn't know that was something somebody made up on TikTok. I've been doing real estate 40 years, I've never heard that phrase. So seller take back. What this is is an illegal loan though, because when the mortgage company finds out, and they will when they discover, for instance, that the homeowner's insurance that has to be reported to the mortgage company is not in the seller's name,

[Additional Caller]

it's in your name and it's in their name still. So if.

[Dave Ramsey]

How can that be? The deed is in your. Did you put the house in your name or not?

[Additional Caller]

Yeah, the house is in our name.

[Dave Ramsey]

Then they cannot have insurance on your house. House. I can't buy insurance on your house. It's not possible.

[Additional Caller]

Great. So would you refinance, like now?

[Dave Ramsey]

Yes.

[Additional Caller]

Okay. Okay.

[Dave Ramsey]

Because here's what's going to happen. If that is a standard mortgage that's laying on the house in paragraph 17 on that mortgage, it has what's called a due on sale clause. Due on sale means if that seller sells the house, that mortgage becomes due on sale in full and that seller has sold the house. And when they discover it, they're going to call that loan and they're going to demand that seller give them $320,000 in 30 days. And if they don't, they're going to foreclose on the house that you thought was yours. Right, but it's not. Okay, but you have recorded a warranty deed into your name. Is that right at the courthouse?

[Caller]

Yes.

[Additional Caller]

Yes. And that's where I thought we were legal. Because how.

[Dave Ramsey]

You are legal. You are legal. You're just vulnerable because the seller is either a shyster or a moron or both. Okay.

[Additional Caller]

Okay.

[Dave Ramsey]

Because they don't understand that you cannot keep a loan in place with a due on sale clause in it. And all, all current modern mortgages have a due on sale clause in them. If you got an FHA loan from 1972, it does not have a due on sale clause on it, but they don't exist anymore because they've all been paid off. That was 50 years ago. So the. But, but, you know, so back in the day, when I first started in real estate in the late 70s and early 80s, we had all kinds of FHAs laying around that you could assume without a due on sale, but those are. Have been gone for 50 freaking years. Okay. Okay. So anyway, this thing, if you pulled up their mortgage deed, okay, the trust deed, in most states, it would be, if it's a Fannie Mae, a standard conventional loan, you just flip it over to, you see paragraph 17. It will say due on sale. If the title is transferred, it becomes a balloon note. And they call the. It's in default. They call the whole loan, and the seller does not have the ability to pay the loan off. And so they're going to get foreclosed on. And because the lien is still on your property, you're going to end up losing the property. So you need to get this refinanced and get these shysters or morons or whatever they are out of your life as fast as you can. And you need a standard $380,000 mortgage and pay them off, or $400,000 mortgage or whatever you got to go get to get them paid off as fast as you possibly can. How long have you had the property and in your name?

[Additional Caller]

A year.

[Dave Ramsey]

Good, because it's going to take 12 months before they'll look at appraised appraisal versus acquisition. Okay. And so now they can look at appraisal. And I assume the house is worth more than when you bought it?

[Additional Caller]

Probably, yeah.

[Dave Ramsey]

So you guys have any money? You obviously put down everything you had, right?

[Additional Caller]

We did, but, like, over this last year, we saved up 100 grand. So I was just thinking we'd put some of that.

[Dave Ramsey]

I would. And if you can get a, if you can just get like your credit union to give you a $300,000 mortgage.

[Additional Caller]

Oh, okay.

[Dave Ramsey]

You know, just easy, just something quick, right? Or call Churchill Mortgage and they can help you walk through it. But I would get this out of these people's names as fast as you possibly can. And for God's sakes, get the homeowner's insurance in your name. You have $700,000 of equity. If this thing burns down, that's going to go to them.

[Additional Caller]

Oh, wow, that would be awful.

[Dave Ramsey]

Yeah, yeah. Because the homeowner's insurance is not in your name. And by the way, you can't have insurance. Insurance law is basic. You have to have an insurable interest. I do not have an interest in Jade's house legally. So I can't go be buying insurance on somebody else's house. That's the insurance on your house. This house is in your name. Their insurance policy is not valid.

[Jade Washall]

Yeah.

[Dave Ramsey]

So you're gonna. They're not gonna get the money. You're gonna end up with nothing. Nobody's gonna get nothing because the insurance company's gonna go, you didn't own the house.

[Jade Washall]

Yeah. Is that illegal? Like if that can't.

[Dave Ramsey]

If something like that happens, it's not illegal. It just invalidates the policy. So the light. The insurance company's gonna go, no, I'm not. We're not writing a check for a million dollars on a property that to the people that are not our client and our client doesn't own the property.

[Jade Washall]

Right, right.

[Dave Ramsey]

So. So it's not worth the paper it's written on.

[Jade Washall]

Oh, that's a mess.

[Dave Ramsey]

It's useful. Useless. So there's so much wrong with trying to do what is effectively called a wraparound mortgage, where they wrapped around the old mortgage and they carried back 60 and they wrapped around the 320 for a total of 380. You can't do a wraparound mortgage where there's a due on sale clause. And I promise you there's a due on sale clause on that. I promise you there's is. So. Yeah, that's. That's what you get into. Ouch. Scary, scary, scary, scary. Yes. Get refinanced as soon as possible and get. Go and go buy insurance on your property today. Go buy homeowners insurance today. Forget that they've got it. And no, we're not paying them for it because paying their policy is ridiculous. But that's why they didn't want to change the policy, because when you change the policy names out, it tells the mortgage company that we've sold the house and it activates the due on sale clause.

[Jade Washall]

That does sound a little shifty.

[Dave Ramsey]

Well, it's just dumb. It's some somebody doing real estate on Tick Tock that puts this hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace. And that's to walk daily with the Prince of peace, Christ Jesus,

[Additional Caller]

Sam.