Caller (2:42)

Yeah.

Dave Ramsey (2:44)

Don't do it.

Caller (2:46)

Yes.

Rachel Cruze (2:47)

And Cooper, I always wonder, because at Ramsey. I know it's a shock, Cooper, but we don't have credit cards inside the company. We use cash. And we used to even bring literally envelopes of cash. Like if we were on the road traveling for events and stuff. So we in our company, you know, obviously it is so cash based. And I do wonder the psychology of a consumer or not a business, but the consumer shows, studies show you do end up spending more with a credit card because there's an emotional detachment to your money. It's just that that is what it is. And I wonder in the business, it's going to. That principle would roll over into a business side where you may not even realize it, but you're thinking, oh, yeah, well, we can just.

Dave Ramsey (3:25)

I'll buy that. I'll buy that.

Rachel Cruze (3:27)

We can do a little bit more.

Dave Ramsey (3:28)

I'm getting a load of stuff, but I'm going to go ahead and buy this extra because I'm getting 2% back. Because I'm getting 2% back. So you could happen. Yeah. So I don't, I don't have any data to prove it.

Caller (3:37)

We spend, you know, to get like 10 grand back. I was doing some of the numbers of what we have.

Dave Ramsey (3:41)

You don't get 10 grand.

Caller (3:43)

Well, that's a truck. I agree to.

Dave Ramsey (3:47)

Yeah, no, I really, I would spend my time and my brain power doing what you're doing instead of trying to trick Visa and win against them. 100% of the time, they have a plan to win. And if you think you're beating them, you know, I'll give you another example, guys out there, because this always comes up. Rachel. I get airline miles. That is so humorous. 78% of the airline miles are never redeemed. Wow. That makes your little theory useless. That's 8 out of 10 airline miles do not ever see the light of day. And if you did want to actually redeem your airline miles, you have to burn so many of your brain calories and Jupiter has to be aligned with Mars in the Age of Aquarius, and you happen to get the perfect person on the phone to actually show up.

Rachel Cruze (4:45)

They have made it easier. So to that point, it used to be more, I think, like that 100%. But some of them, yes, have protection.

Dave Ramsey (4:54)

Easier than impossible, but not easy. I can call and book an airline. Boom.

Rachel Cruze (5:01)

You don't call. You do it online. You do it on the app and you just change the number. But the point is, though, that's the thing, is that if the airline ticket, if you need a free airline ticket via your credit card points, if, if you can't go on a vacation because of an airline ticket, you shouldn't be going on vacation. So the idea that you're, you know, living this system in order to do something, if you couldn't afford to do it in the first place. You don't need to be doing it overall, so.

Dave Ramsey (5:25)

But I'm. It's always humorous to me because I've never interviewed a millionaire that said, Dave, you know, the way we got here was airline miles. That's how it happened. The airline miles. That was our financial breakthrough.

Rachel Cruze (5:37)

Yeah.

Dave Ramsey (5:37)

And that's just horse crap.

Rachel Cruze (5:38)

Well, it's.

Dave Ramsey (5:39)

I mean, it's just bull.

Rachel Cruze (5:41)

I know. And I think in an overarching mindset to so many people we've talked to who have said, you know, we played the credit card game and then we chose not to. We're done. Is there is a level of peace when you just live in the present. Right. You go and last night shopped online, and you pay for it, and you're done. Like, it's. It's done. Like, when you live in the present, there's not something out in the future that you're looking for. And so there is a true. From a mathematical standpoint and an advantage there and an emotional where you're like, I'm not at all even thinking about a bill, because it's done. It's over.

Dave Ramsey (6:12)

I'm taking up my brain power, all the stupid stuff. Seriously.

Rachel Cruze (6:16)

Yeah. There's a power.

Dave Ramsey (6:17)

There's a piece to that. You're right. But there's also that brain power can be used to make you way more money than you would have gotten a free biscuit with. I mean, it's just the numbers are ludicrously low, and the percentage of people that actually cash it in is almost zero. It's the biggest screw job. And yet everybody walks around, acts like they're sophisticated.

Rachel Cruze (6:39)

Well. And not to mention the fees. And I just saw. It's like a platinum card or something has upped their annual fee. So the. The amount of money you have to even spend to have the card, you have to consider that, too.

Dave Ramsey (6:52)

The one you saw. Do you remember?

Rachel Cruze (6:53)

I know. I'm trying to think. It was a platinum. It may have been a platinum. It was something. Because it had to do with a lounge in an airport, because it was a whole article. And then these people were joking about the lounge because the lounge was kind of a joke. Some lounges, I think, are nice, but this one was like a. It's like Ritz crackers and cheese, you know? And they were like, oh, my gosh, I'm spending this much to keep a credit card to get me in a crappy lounge. When I do try, like, the whole thing is just silly. It's like this.

Dave Ramsey (7:14)

I spent annual fee or a 500 annual fee to get $4.

Rachel Cruze (7:19)

And they're upping those annual fees.

Dave Ramsey (7:21)

I mean, this one says Amex just.

Sponsor/Announcer (7:23)

Upped it from 6.95 to 8.95.

Dave Ramsey (7:25)

Amex up there.

Rachel Cruze (7:26)

Maybe that's what I saw.

Dave Ramsey (7:27)

The Amex platinum card was 6.95 and now it's 8.95 yearly. Well, Amex is just double dumb, but yeah. So yeah. 895. $895 to get to. For the opportunity to be your customer and spend my money. Let you. Good God.

Rachel Cruze (7:41)

Or you can go to Fairwinds and they're the nicest people, you know, the credit union. You deal with them and you're good. And you're good. So it is, it's. It's a game people continue to try to play.

Dave Ramsey (7:51)

You can get the debt is normal beware debit card.

Rachel Cruze (7:54)

I know we just got. We just got ours two days ago. Winston. I did and I went on. Talk about an easy process. Fairwinds, thank you. Their app. I went on and activated the card. You call, you do your PIN and you're good to go.

Dave Ramsey (8:06)

That's completely free. Yes. Not $8.95 and.

Rachel Cruze (8:09)

Yeah.

Dave Ramsey (8:09)

For a platinum titanium double backflip card. Now this is just a regular old debit card and it just won't let you spend money unless you have it and stuff like that. Wow. Way to go. Fair winds. I do like that. We have a Ramsey debit card that says, debt is normal, be weird. Every time you pull it out of your pocket, you have to look at that and go, debt is normal. Be weird. Debt is normal. Be weird. It's like this reinforcing meth message. I love it.

Sponsor/Announcer (9:01)

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 (9:09)

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

Sponsor/Announcer (9:17)

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

Dave Ramsey (9:24)

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.

Sponsor/Announcer (9:40)

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. So it replaces a large part of your income so the bills still get paid while you get back on your feet.

Dave Ramsey (9:54)

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.

Sponsor/Announcer (10:12)

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 (10:19)

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

Sponsor/Announcer (10:25)

So don't wait. It's fast, it's easy, and it could make all the difference. Go to zander.com or call 800-356-4282.

Dave Ramsey (10:33)

Protect yourself, protect your income, protect your family. Big celebration. They're all all around Ramsey. Today. 1100 of us are jumping up and down, excited. Why? Because it's official. The all new every dollar is live. Rachel?

Rachel Cruze (10:58)

Yep, it's here. It's something that we've been working on as a team for a while. It's been a big goal to get every dollar not just as a budgeting app, but for your entire financial picture. Because we want to walk with people through not only all the baby steps, but even looking at everything down to, you know, your insurance, I mean, all of it. Like it, it is so impressive what's been accomplished and the fact that it's today's the day. So fun.

Dave Ramsey (11:22)

What it amounts to is that there's two things that we have done that have revolutionized people's lives in the area of money. If they go do them. Okay, One is the Ramsey plan overall and all that, that means baby steps and all the things around it and then having the place to apply those principles in a thing called a budget. And that's always been the case. If you do the budget and you do the Ramsey plan and use that to implement your budget, you always will. Get out debt, build wealth. Being a place to be generous, it always works. And this is the first time we've ever had it all woven in to a digital thing together. And so it's the best way to do the Ramsey plan while doing your budget is the new EveryDollar app. So we have, like Rachel said, we spent a bazillion dollars and man hours and brain calories in this place, getting this thing ready. And it's live. We're really excited. The baby is here. So watch the premiere now on our YouTube channel and see what it's all about. You can hear from everyday people who are using everydollar. They're finding thousands of dollars in margin. Think about what you could do with thousands of dollars to get out of debt so that you could build wealth. It's pretty cool. If you do one thing for yourself today, let this be it. Watch the premiere of the new all new Every Dollar. It's here. And Rachel's prominently featured in that along with Jade and George and so forth. This could be the thing that changes everything for you because this is the one, two, punch that for 30 something years we've been doing at Ramsey. The Ramsey plan. The details of this. Boom.

Rachel Cruze (13:01)

And it's an app on your phone, which is.

Dave Ramsey (13:02)

And now you can hold it in your hands and do the whole thing.

Rachel Cruze (13:06)

Your phone goes everywhere with you, which means your financial plan does too, which is great.

Dave Ramsey (13:10)

Yeah, it's pretty stinking incredible. Yeah, you're exactly right. It's convenient. Oh, and by the way, those of you that have been wise enough to combine everything with your spouse, boom. It's all right there in both of your hands. You know what the other one's doing. Everybody knows what everybody's doing. We're on the same page. We're pulling together. Boom. Boom, Boom. It's so powerful, you guys. So check it out. The All New EveryDollar is live. Watch the premiere of the All New EveryDollar. It's right there on YouTube on our YouTube channel. And you can find thousands of dollars of margin. Andrew is in Washington. Hi, Andrew. How are you?

Caller (13:43)

Oh, better than I deserve. How are you doing, Dave?

Dave Ramsey (13:46)

Better than I deserve. How can we help?

Caller (13:49)

I just recently found out about you guys and I love your program and I'm trying to work it with gazelle intensity. So we, me and my wife recently bought a house, but it's about 40% of our income. Trying to build my emergency fund right now. We just got all of our credit cards paid off and the car paid off.

Rachel Cruze (14:12)

Good for you guys.

Caller (14:14)

Thank you. Yeah, it's exciting. It's exciting to actually have cash again. So I guess my question is after we save the emergency fund, because this mortgage is so much of our income, would it benefit me more? And we got a 30 year loan to try and pay this off early so that we have more to put towards the 401k or just go to 15% into the 401k. And the mortgage will take as long as it takes.

Dave Ramsey (14:48)

I've seen just hardly anyone prosper when their house payments 40% of their take home pay. So I don't really know how to answer you other than to give you a really hard answer, and that's sell your stupid house because it's way too big and too expensive. Unless your income is going to go up dramatically in the next 36 months, this is going to stunt your financial growth because you're mathematically what we all in the financial planning world call house poor. You feel it in the stress when you're trying to do the budget, don't you?

Caller (15:28)

Yeah, no, definitely.

Dave Ramsey (15:29)

So what's your household income, Sir?

Caller (15:32)

It's about 110.

Dave Ramsey (15:34)

What do you guys do for a little hits? I'm sorry, go ahead.

Caller (15:38)

Sorry. I know exactly what hits our account more than I know the, the before taxes. But we get 8,248 every month that hits the account.

Dave Ramsey (15:48)

Okay, and what do you guys do for a living?

Caller (15:51)

So we work in organic gardening. So we work for a garden supply store. And we actually in order to take this job, we had to move to Washington. And originally part of the job was that I didn't have rent. We lived on site. There was a property where the business was run and we got to live in a two bedroom house for free on that property. But then my boss sold the property last year or well, I guess decided to sell last year. He's just now sold. And then so we had to move but we were having trouble finding rental property.

Dave Ramsey (16:32)

So you got a, you moved out from out of state to take the job and then he cut your pay?

Caller (16:38)

Yeah, well, I mean he gave me a 50% raise to try and as like a housing allowance. So he gave me, I was making $20 an hour, now I make $30 an hour. So it felt like a substantial pay bump.

Dave Ramsey (16:54)

What does your wife.

Caller (16:57)

She does marketing and customer service for the same company. Yeah.

Dave Ramsey (17:03)

Because she makes a lot more than you then.

Caller (17:07)

Not at the moment.

Dave Ramsey (17:08)

So darling, $30 an hour is not $110,000 a year.

Caller (17:13)

So I make I think 60 and she makes 50. I think she makes 25 and I make 30 an hour.

Dave Ramsey (17:21)

That's not $110,000 a year.

Caller (17:26)

Okay, when, when we were going over the raises with the accountant.

Dave Ramsey (17:32)

Yeah, just go multiply that times 40 hours. It doesn't, it doesn't come out to 110.

Rachel Cruze (17:37)

Well, they're bringing home close to 90. And after tax.

Dave Ramsey (17:40)

No, it says 8300. Yeah. Yeah. So which is $100,000 a year and that's, that's after tax net. Yeah. Thirty dollars is his gross. So pre tax is thirty dollars is his gross. So no, he's not even close. So anyway, I don't care how you got here as much as I care how you get out of it. And you learn from how you got here. You felt like you were forced to go do something that. To buy something you couldn't afford and you went and did it instead of finding an alternative. And I. Unless you are going to see your way to substantial raises in a very short period of time, I can't recommend you keep this house because I love you and I want what's good for you. I think you bought a house you can't afford and you're going to be strapped by this house and it owns you. You don't own it and you don't have the money to get ahead. So you guys got us. You need to sit down and do a little better job with your math because I think it's off and I know it's off. One of these numbers is wrong, in other words. And then figure out okay, you know, can what, what can we do with our careers that allow us to stay in this house by causing our income to go up pretty dramatically so that the house payment becomes a smaller percentage of our take home pay. But if you have a 30 year mortgage and your payment is, I don't even know, that's barely choosing.

Rachel Cruze (19:07)

I mean because that's. And I don't know what you would say to this, but I'm like, you're either gonna choose to change careers in order to keep a house, but if you guys love what you do, then you gotta lose the house. Like, you know what I mean? It's.

Dave Ramsey (19:19)

Something's gotta go.

Rachel Cruze (19:19)

Yeah, something's gotta gotta.

Dave Ramsey (19:21)

Or if this career is, I don't know your arrangement, but so far it's not been good with this employer. I mean so far it went sideways on you. But the cause I'm not sure. $10 an hour. $10 probably does offset an hour. Probably did offset the rent value of that two bedroom house, but. But then you couldn't find a rental to suit you so you went and bought a house you couldn't afford.

Rachel Cruze (19:47)

Well, it's the urgency that caused probably a poor decision because he said we couldn't find somewhere to rent. And you know, and then you kind of get desperate and then you pull the trigger on.

Dave Ramsey (19:56)

Then you start saying things like there's no houses. Don't ever say that. There's no rentals, there's no price. You cannot live here for that price. Yeah, yeah, you can. You just didn't like that neighborhood. So anyway, honey, I'm afraid you can't afford the house. But if you can't get your income up, I'm gonna tell you. Cause I love you to sell the house. Cause I think that house is not worth you limping for the next decade. Financially, let's face it, health insurance today is more complicated than ever. The system isn't built to help the average person understand and it leaves too many families unprotected. That's why you need my friends at Health Trust Financial. They aren't just brokers. They're trusted health insurance advisors who have been helping families like yours for over 20 years. You don't have to navigate it alone. The experts at Health Trust Financial listen to your needs, work to understand your family situation and budget, then help you choose the health insurance plan that's right for you. That's why they're Ramsey trusted and why we've worked with them for two decades. Look, medical debt is the number one cause of bankruptcy in America today. One hospital visit can wipe out your savings and undo all your hard work. So health insurance isn't optional. It's part of your financial defense plan. Health Trust Financial knows their stuff and they're the only health insurance provider I recommend. So get clear about health insurance plans and get the coverage that's right for you. @healthtrust financial.com Philip is in North Carolina. Hey, Philip. How are you?

Caller (22:19)

Good, Dave, how are you?

Dave Ramsey (22:20)

Better than I deserve. What's up?

Caller (22:23)

Thank you so much for taking my call. This might be one of the coolest things I ever got to do.

Dave Ramsey (22:27)

Well, me too. How can I help?

Caller (22:29)

Thank you. I had a question for you. Some advice on a financial decision that I'm kind of considering and I just didn't know what the best way to go about it was. So. I'm 21 years old, I live with my parents, still have a pretty good job, and I currently drive a pretty nice car that I absolutely love but absolutely hate paying for. And my question is whether or not I should go ahead and sell my car and buy something that's kind of like a little rinky dink car and get out of debt tomorrow or if I should wait a little bit and pay it off while I still live at home. And if I did that, this would kind of delay me moving out for a little while. But of course I Get to keep the car that I really do love. So just kind of wondering if you were in my shoes with a car you love but a car you hate paying for and you want to move out or want to have the flexibility to move out, would you wait and pay it off and delay moving out, or would you go ahead and get out of debt as soon as possible and then drive something that's kind of crappy?

Dave Ramsey (23:33)

Really, really good analysis. Well done. Good job. How old are you?

Caller (23:37)

Thank you. I am 21.

Dave Ramsey (23:39)

What do you make?

Caller (23:41)

I make about $60,000 a year, and then I also have some side work that I do that brings in about 5,000 a year extra.

Dave Ramsey (23:49)

Okay. And what do you owe on your car?

Caller (23:53)

I have just over $20,000 on. On the loan.

Dave Ramsey (23:57)

What kind of car is.

Caller (24:00)

Is a 2023 bright blue Dodge Charger.

Dave Ramsey (24:04)

Oh, that's sweet. Oh, blank.

Caller (24:06)

I love it. Yeah, I got it right after I started working full time. I'm in marketing and sales, and my car broke down two weeks. Like, two weeks after I started the job. And so I heavily upgraded, and, you know, like I said, I kind of. If I could do it back over again, I'm not sure if I would do it.

Dave Ramsey (24:23)

Yeah, I was completely irresponsible. But it's an awesome car.

Caller (24:26)

Yeah.

Rachel Cruze (24:27)

Have you. Kelley Blue Book did it all. Do you know what it's worth?

Caller (24:32)

Yeah, the. It's worth now only, like, 22, 23,000. But I have a few offers on some private site for about what I paid for it, which is about 28,000.

Dave Ramsey (24:47)

Okay.

Rachel Cruze (24:47)

So you can make. Okay.

Dave Ramsey (24:48)

Make money.

Rachel Cruze (24:49)

Yeah. So you could go in and then go buy an $8,000 car and then move out and live your life without a car payment.

Dave Ramsey (24:56)

Okay.

Caller (24:57)

So I'm doing that also not, like, dying to move out. Like, I don't want to do it right now. So that's kind of the thing is the. I just kind of want, like, that flexibility, you know what I mean? So I just. I could pay it off by late next year, but I don't want to. I don't want to tie myself down.

Dave Ramsey (25:09)

I know that you're making $65,000 a year. Where's all your money going?

Caller (25:18)

Well, I mean, I'm saving a lot of it.

Dave Ramsey (25:20)

Oh, good. How much is in savings?

Caller (25:23)

I have just over. I think, in total, closer to about 14,000, $15,000.

Dave Ramsey (25:30)

Okay.

Caller (25:32)

And the reason I'm asking this is because I had kind of thought, like, you know, I'll pay it off at some point. I kind of just Play the game. But then I rediscovered your content online, and I realized I don't have peace. And your thing is called financial peace. So I don't really know what to do.

Dave Ramsey (25:49)

All right, so here's the thing. You've apparently just discovered it, because one of the things we teach is called the baby steps. And it's the process that you work through from where you are today. Ready, set, go. To get out of debt so that you have your freed up income to build wealth with, and in your case, have a life outside your mama's basement. Build wealth and build generosity. And, of course, baby step one is $1,000. Anything above that that's not in retirement goes towards the debt. And baby step two is pay off all your debt except your house. Working them off, smallest to largest. You probably heard us say that, hadn't you?

Caller (26:27)

Oh, yes, definitely.

Dave Ramsey (26:28)

So that plan would dictate that you take 13 of the 14 and put it on the 20 today. That would leave you seven. And I want you debt free in two months. You make $60,000 a year, and you have no overhead. Quit going out every night. Oh, there's that.

Rachel Cruze (26:50)

Okay. So that. Okay, so you can do that, Philip. But let me throw this out there. You're 21. You've got $14,000 in savings. You could sell this car tomorrow. Go buy an $8,000 car, still have $14,000 in savings. Go rent an apartment, live your life. You're on baby step three. Then you start investing. I'm like, I'm done with the car. You could pay it off 100%. 100% if you choose to. But also, that drains all of your savings for a charger.

Caller (27:18)

Sorry.

Rachel Cruze (27:18)

You and Dave have, like, a love affair over chargers. But I'm like, no, go get, like, a great Honda Civic. I know. And I'm like, no, no, just go get a Honda Civic and live your best life. Phillip, don't let this car be the thing that, like, drains your savings. I don't know. You can. That is the baby steps. That would.

Dave Ramsey (27:36)

Yeah. It would not be wrong. It would not be wrong. The rule we use on cars is, can you pay them off and all your debt in under two years?

Rachel Cruze (27:43)

I know.

Dave Ramsey (27:43)

Otherwise the car has to be sold. And is the car less than half your annual income? It is. And do you love the car?

Rachel Cruze (27:50)

All of it?

Dave Ramsey (27:50)

Yes, you do.

Rachel Cruze (27:50)

But also.

Dave Ramsey (27:51)

So you meet all the guidelines.

Rachel Cruze (27:52)

You do, you'll be fine. But also, plan B, crazy plan, would be sell it and you can start investing, like, in the next couple of months with Retirement. Like you could snowball your future so fast, Philip, and then you can save up and go buy another car. I don't know. I think the car is. I think it's a great picture of where does Philip want to start his 21 year old life and beyond.

Dave Ramsey (28:15)

If I were in your shoes, Dave's keeping the car in January either way. No, I would do either one. I don't care. I'm with you. There's nothing wrong with your suggestion completely. I don't disagree with your suggestion at all. It's 100% okay. It's also 100% okay. But by January, you need to be in your own apartment and be debt free. If you're not willing to do that, you need to sell the car.

Caller (28:39)

Okay.

Dave Ramsey (28:40)

If the only way to do that is sell the car. And it's not the only way to do that mathematically, by the way. If you do what I told you to do, it could be debt free, have the car and be in an apartment by January. Because when you get out of the house, different gears are going to start hitting in your head and you're going to go to a different place in your young man development and you're going to start to see life different. You're going to start to make different decisions. Money choices, career choices, everything. I predict that five years later your income will be higher if you do that, what I just told you to do.

Caller (29:12)

Okay.

Dave Ramsey (29:13)

Because you're out there on your own and you have to buy your own milk.

Caller (29:17)

Right.

Dave Ramsey (29:19)

It makes a difference. It just does. And I watched that with our kids. Rachel left college straight into marriage, so she never passed back through, but her sister passed back through for a few months and then went out on her own. And I watched her change as she went out on her own.

Rachel Cruze (29:38)

I mean, it really. Yeah. It forces you to positively be 100% responsible for your whole life. You know, I mean, it does. It's a good thing.

Dave Ramsey (29:43)

Yeah. The lights get cut off if you don't pay the bill. You know, that kind of stuff. So I'm going to encourage you to get out of the house. Not because you got a bad situation or toxic situation, but because it's time to grow up, move on. And I'm going to encourage you to get the car paid off one way or the other, either by selling it and doing Rachel's plan or by working another plan that is within the guidelines, but not as smart mathematically. But it's also okay. You love the car. We've all established that. So by the way, if the car was 35,000, we both would be telling you to sell it because it'd be more than half your annual income. Okay. In value, even if it was paid for. Because, folks, if you, everything that has wheels and has a motor goes down in value. And if you have more than half your annual income invested in things that are going down in value, you don't have to scratch your head and wonder why you're broke. It's in your driveway. It's the bass boat, it's the sea doo. It's the car, the campers, it's the camper, it's the whatever. If it's got wheels and, or a motor, it's going down in value, period. And when you have too much of your mathematical juice tied up in things going the wrong way, it's almost impossible to pull it off. That's what Rachel's suggestion is coming from.

Rachel Cruze (31:02)

Yeah, and the fact that we get calls, I'd say nine out of 10 calls we get on cars, they owe.

Dave Ramsey (31:07)

More than it's worth.

Rachel Cruze (31:09)

The fact that he can make 8,000 on it, I'm like, yeah, do it well. Make 8,000 from what he owes, but not what he originally bought it for.

Dave Ramsey (31:16)

He actually walks away from the table with money, which is very unusual.

Rachel Cruze (31:19)

Yes. Oh my God. Take advantage of that. And then it is a blue charger.

Dave Ramsey (31:26)

Yeah. Yeah, it's pretty sweet.

Rachel Cruze (31:27)

Oh, I'm getting, I'm getting nods from the dudes in the booth.

Dave Ramsey (31:30)

The guys in the booth are all going.

Rachel Cruze (31:32)

And you know what? The booth dudes, majority of women, Philip, they don't have no idea. Yeah, we got, we don't know.

Dave Ramsey (31:39)

And if she did go out with you because your car, you don't want her.

Rachel Cruze (31:42)

And then you got to bring her back home. So get out of your parents house.

Dave Ramsey (32:02)

What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 42,000 businesses have future proofed themselves with NetSuite by Oracle, the number one AI cloud enterprise resource planning system. Ramsey Solutions uses NetSuite and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities with one unified business management suite. There's one source of truth for the visibility and control you need to make quick decisions. NetSuite's real time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you spend less time looking backward and more time focusing on what's next. And speaking of what's Next, download the CFO's Guide to AI and Machine Learning at netsuite.com Ramsey. It's free at netsuite.com Ramsey if you like what you hear, help us out by sharing the show. Click the share button or click Cut a link out and send it to a friend. Or just tell them that we're here. We appreciate that. Those five star reviews are very helpful. Thank you for that. Because it moves the show and the algorithm out to the front when people are getting a suggestion on their podcast or their YouTube or whatever it is. Yeah, they get it all there. And we're on all the platforms. So whatever you're listening on or watching on, just tell people we're here. Thank you for doing that.

Rachel Cruze (34:06)

You can watch on YouTube and see that Dave and I are matching today. Did you see that black shirt memo and some buttons. I know.

Dave Ramsey (34:12)

And the guys in the booth all have on the new every dollar T shirts.

Rachel Cruze (34:16)

Oh, they do.

Dave Ramsey (34:17)

So they all look like they're matching. Came out of a 1950s gym class with those white shirts, but white T shirts, very good.

Rachel Cruze (34:25)

They look great.

Dave Ramsey (34:26)

They're, they're, they're, they're snazzy looking. And Joe has his tucked in, so I'm just saying, I'm just saying.

Rachel Cruze (34:31)

We appreciate that, Joe.

Dave Ramsey (34:32)

There we go, Joe. All right. Susan is with us in Maryland. Hey, Susan, how are you?

Caller (34:38)

Hi, Dave. I'm well. How are you?

Dave Ramsey (34:40)

Better than I deserve. What's up?

Caller (34:44)

Thanks for taking my call. I have a question. So I recently got engaged and I am trying to figure out with my fiance how should we approach merging our finances after we get married when I have a pretty high net worth and he has really no future investments, but has a lump sum of cash.

Dave Ramsey (35:16)

Okay, and how much is your net worth?

Caller (35:21)

About 2 million.

Dave Ramsey (35:23)

Okay, way to go. How old are you?

Caller (35:25)

53.

Dave Ramsey (35:27)

Okay, and. And what is his net worth, do you think?

Caller (35:32)

250,000.

Dave Ramsey (35:33)

Oh, not bad. Okay, and how old is he?

Caller (35:37)

55.

Dave Ramsey (35:38)

And what does he make?

Caller (35:41)

About $6,000 a month.

Dave Ramsey (35:44)

What do you make?

Caller (35:46)

I just retired, but I made almost 200,000 a year.

Dave Ramsey (35:52)

So what are you going to do in retirement at the young age of 55?

Caller (35:57)

Sure. I have not figured that out yet. It is very recent that I just retired.

Dave Ramsey (36:02)

Okay. You're not married Yet. How are you buying groceries?

Caller (36:10)

How are we buying groceries?

Dave Ramsey (36:11)

How are you buying groceries?

Rachel Cruze (36:13)

You have money saved. I mean, she has a two million dollar net worth.

Caller (36:18)

Oh, oh, how am I. I have money and I have a pension. I have a pension coming in.

Dave Ramsey (36:24)

Oh, okay, great, Great. All right. What is the 2 million invested in?

Caller (36:31)

So the 2 million is. My 401k is about 1.1. I have a Roth IRA, I have money market, I have a savings account. So all that in total is about 1.6. And then the value or the net value of my home is about 400,000.

Dave Ramsey (37:01)

Okay, cool. The. On a home or a 401k account, when you get married, there's no nothing to do. You can't add someone to your 401k account. You could add someone to a deed, but it's probably not necessary. Then what you've got to determine is, is this a large enough difference that you want to make sure you're covered in the event of a divorce? Okay. And if you do, obviously there's two things you can do on that. One is prenup, and two is. And this is a pretty large difference. The only time we ever would say the word prenup is if there's a huge difference between the two. Okay? And generally it's not to protect you from each other. It's more to protect you too, from your weird relatives. When you have a prenup, you just go, ha, can't help you. I got a prenup. So, can't open a pizza parlor with her money. Sorry, sorry. Crazy cousin Eddie, you know, so. And that's the kind of thing that helps. It helps a lot with that. The other thing it forces you to do is it forces you to talk through this. Now, some states, and I do not know the law in Maryland and I'm not a lawyer anyway, so you can't trust me on this. But some states would protect your 401k that you came into the marriage with and would protect the real estate that you came into the marriage with.

Rachel Cruze (38:19)

And probably the Roth too.

Dave Ramsey (38:20)

And the Roth, the Roth is definitely protected. But I, you know, and so if you didn't name him the beneficiary in the event of your death or if you got divorced, the 401k would be protected in most states. I don't know the law in Maryland, you could ask somebody on that to find out and not Google a lawyer. Okay.

Caller (38:40)

Yeah, I'm not sure that we're going to stay here just because, you know, I now that I'm not working. I don't need to stay here. He works remotely. I guess my bottom question is, what am I missing? He's got a lump sum that he's not doing anything with. It's 250,000. He's got a lump sum and no debt. But I guess my question is, should we, when we merge everything, should that lump sum be invested and we're kind of just living on our. My pension and his salary.

Dave Ramsey (39:17)

Yes.

Caller (39:18)

I just don't know what to do. We don't.

Dave Ramsey (39:19)

And you sell your house. If you leave Maryland and you take that money to buy the house in the next place.

Caller (39:25)

Yeah. So we have our own individual houses, but when we get married, we'll merge and we'll move to a different state. Cost of living will be less.

Dave Ramsey (39:33)

I think if you sold both houses and use the equity from both houses to buy the next house, then you've got to think about that as well. But paying cash. Yeah. Oh, definitely. Definitely. Yeah. Your house was paid for, right?

Caller (39:47)

No, I have 400,000 left over on a 700,000.

Dave Ramsey (39:52)

Oh, I thought it was a $400,000 house. Okay, cool. You have 300 equity. And how much equity does he have?

Caller (40:01)

He just sold his house. So he. That's where he walked away with the.

Rachel Cruze (40:05)

Oh, the 250. Was that.

Dave Ramsey (40:07)

Okay, so you have. Yeah, yeah. So you have 550 to buy a house in the new state, and that probably will do it.

Rachel Cruze (40:11)

Yeah. Susan, does it worry you at that he's in his 50s and has no money saved. The only money he has to his name was from his house.

Caller (40:18)

Yeah, absolutely. That's a great question. I was worried. I didn't know about that at first, but after we started getting serious, it made total sense to me. He had his own business, and he just kept on believing in it and pouring money into it, and he liquidated his retirement to keep the business going, and then finally just gave up.

Rachel Cruze (40:45)

Was some mistakes that he's aware of of why he's in the position he's in.

Caller (40:51)

Post Covid.

Dave Ramsey (40:53)

Yeah. It feels like you're fairly new to Ramsey. So let me give you two principles that are in conflict with each other in this discussion that we believe in both of. Okay, Principle number one is where I told you earlier, I used to tell people, never if you. If you like your money more than the person, just don't get married. If you got to have a prenup, you don't need to be married because you like your money more than you like them. And then over the years of Decades of doing what I do, not only here on the air, but sitting in person. I found that where there's a huge differential between like 2 million versus 250 is a huge differential, then it does help the relationship in many cases. And it does help the crazy cousin Eddie's that are out there in the family tree somewhere to have a prenup. And so that's principle number one. And that's standard teaching from this microphone that you would have heard over the last decade to two decades. Okay. The second principle that seems to be in conflict with that and kind of causes your call to happen is we know that couples that combine their finances, combine their earnings and work together to create a future together, succeed vastly in the quality of their marriage and succeed vastly in their wealth building capability. We've got tons of data on this to prove it. And so encouraging the two of you to combine your pension, his income to create your future together, 100% have to do that. Okay. And 100%, whatever money your 2 million makes, if it comes into the checking account, we're going to combine it and we're going to live our life with it. Whatever money he makes from whatever, we're going to combine it. And if we're going to both throw in about 2 or 300 grand on this house, we're just going to call the house our house and that's it, the new house in the new place. Then, you know, so really work to be unified and combined as a household. But if you wanted to protect a few individual Items like these 401ks and stuff prior to marriage, then the prenup would be in order. And it's not in conflict with that, but it feels like it is. And I probably would do that in your case. If you've listened to me for more than five minutes, you know that being normal with your money is not a good thing because you normal is broke. And I want you to be weird. That's why I love what we're doing with Fairwinds Credit Union. Our friends at Fairwinds just launched a brand new Ramsey debit card and it says debt is normal. Be weird right on the front. I love that because every time you swipe it, you're choosing to live differently with no credit card payments and no debt. You see, Fairwinds has been helping people like you ditch debt faster and build wealth for years. They're not trying to shove credit cards or auto loans in your face like the big banks do. And they've worked with us to create the smart bundle For Ramsey fans, it includes a no fee checking account, a high yield savings account to supercharge your emergency fund, and now the Ramsey debit card to help you stay focused on the baby steps. We're excited for you to try it. So check them out today@fairwinds.org Ramsey that's fairwinds.org Ramsey insured by the NCUA welcome back to the Ramsey show in the Fair Winds Credit Union studio, Rachel Cruz, number one best selling author, Ramsey personality, host of the Rachel Cruze Show. My daughter is my co host today. Joe is in Colorado. Hi, Joe, how are you?

Caller (45:07)

Hi. I'm so honored to speak with you guys. You guys are amazing.

Dave Ramsey (45:11)

Well, thank you. How can we help today?

Caller (45:13)

Yeah, okay. We're. My husband and I have been married three years. We're a little overwhelmed. We worked the first two years to pay down $135,000 of debt on his student loans. We don't have any other debt, but we still have 235 and it's growing because we have not been able to pay anything in the last year. We're actually paying for some attorney fees for my daughter. Her bio dad is now in the picture after eight years. It's a long story, but basically we've been doing that for the last year. I want to get on the same page with my husband and I feel like he feels. I know he feels very guilty about how he hadn't been paying it. He's a recovering alcoholic and you know, he's on the right page now. Both of us are. And we're just. We're expecting a baby. We're gonna move. We're just really overwhelmed. We have no furniture. We've been renting from family.

Rachel Cruze (46:17)

And Joe, y' all got a lot going on.

Caller (46:19)

We do have a lot going on.

Dave Ramsey (46:20)

Your current husband is a recovering alcoholic.

Caller (46:24)

Correct.

Dave Ramsey (46:25)

And how long has he been. How long has he been sober?

Caller (46:27)

He's been sober eight years.

Dave Ramsey (46:29)

Way to go. Good. Bio dad was from eight years ago, right?

Caller (46:33)

Correct. I was not married.

Dave Ramsey (46:35)

Making sure I got my. Sometimes I get confused.

Rachel Cruze (46:38)

And what's the degree in?

Dave Ramsey (46:40)

Because it's like a 4. 300,000. Yeah. Who's the lawyer?

Caller (46:44)

He is. He's not actually making as much as he could be. I think as soon as we are able to move, he'll be able to make more. This location is just completely untenable. He's only making 100,000 and I know he could be making a lot more elsewhere.

Dave Ramsey (47:04)

And what do you do?

Caller (47:05)

I'm a graphic designer and I Actually make almost as much as he does. But I've been in this job for.

Dave Ramsey (47:10)

A long time and. What, so you're thinking about moving to a more metropolitan area to further his career?

Caller (47:17)

Yes. Yes.

Dave Ramsey (47:18)

And when would you be doing that?

Caller (47:21)

The baby's due in December. We're thinking February or March if he can get his bar transferred to another state.

Dave Ramsey (47:28)

That sounds pretty good. Okay.

Caller (47:30)

Yeah, it does sound pretty good. Especially because cost of living will be a lot better.

Dave Ramsey (47:35)

Yeah. And the income will go way up.

Caller (47:38)

Right?

Rachel Cruze (47:38)

Yeah. What would he be expected to make, Joe? 200. 250?

Caller (47:42)

I don't know. He. Since, you know, he. He really has only been working the last four years and.

Dave Ramsey (47:49)

I know, but if you're talking about moving in February, he needs to be on the job hunt.

Caller (47:53)

Yes, and he is. He's got to transfer his bar.

Dave Ramsey (47:56)

I know, but I mean, so he ought to have a clue what he's going to be making.

Caller (48:01)

Well, that's true. I. I think he just wants to get through the first step first getting that transferred.

Dave Ramsey (48:07)

And then I don't want to do all of this and make 105. So I need to know.

Caller (48:13)

I agree.

Dave Ramsey (48:13)

So I need to know. So we don't need to worry about transferring the bar if I'm gonna make 105.

Caller (48:19)

Well, that's true.

Dave Ramsey (48:20)

I mean, so we need to know.

Caller (48:23)

Right. Okay.

Dave Ramsey (48:25)

I think you're making assumptions here that we need to ask the question, what kind of lawyer make in that city doing the type of law that he's been practicing that he can get a job doing? Can he make 150 or 250? And we need to know that that's a key part. Okay. But if you're gonna come out of there making, you know, 150 to 250 somewhere in there and you make this move. That all sounds wise. It sounds like your job is portable so you can take it with you to the city. Right?

Caller (48:48)

Yeah.

Dave Ramsey (48:49)

Okay. Yes. So very cool. I like all that. Okay, so then. Then we got a baby and we got a big old pile of student loans and we've been. We've hit a hiccup by a. An anemic career his. And we had a hiccup by paying lawyer fees, oddly enough to beat back the bio dad.

Caller (49:07)

Right, Right.

Dave Ramsey (49:08)

Okay. So that's. Both of those things are behind us starting in February. Ready, set, go. Am I missing something?

Caller (49:14)

I sure hope so. We. We might have more attorney fees. This is not. It's an ongoing battle.

Dave Ramsey (49:20)

Yeah.

Caller (49:21)

Yeah. We don't have Even basic things like, you know, furniture to eat on, sit on.

Dave Ramsey (49:28)

Stop. You make $250,000, you ought to go buy some furniture.

Caller (49:34)

Okay.

Dave Ramsey (49:34)

When you make the move, I mean, you don't need to. Don't buy into your move, but when you move in February, you have a budget.

Rachel Cruze (49:40)

Yeah. Look through.

Dave Ramsey (49:40)

You ought to be able to handle these attorneys fees and eat and put some basic furniture in there. You don't need to spend $200,000 with a decorator doing this house up or something. But. But yeah, go rent you a place and buy that gum couch and then all. You know, because then you can start to take some of these things that are on your plate, off your plate. And if we're. If we're down to fighting bio dad and Sallie Mae now, we've defined our fight, and we've narrowed our scope.

Caller (50:09)

Okay, that. That makes great sense. And so you would pause the student loans until maybe we're out there.

Dave Ramsey (50:15)

Yeah, for sure. You got a baby on the way, and you don't have furniture.

Rachel Cruze (50:18)

Yeah. Payment on payments, but don't put extra on it.

Dave Ramsey (50:22)

Yeah. I wouldn't worry about. I wouldn't worry about working your total money makeover. Baby steps right now. Push pause. But I would be on a tight budget and pile cash up to make this move. We make the move, buy a couch, settle in, have the baby. Life is good. Everybody's home and safe. All the medical bills from the delivery, if there are any out of pocket, are covered. All this is done. Boom. Now we're set. Ready, set, go. And we have two goals. Beat bio dad and Sallie Mae.

Caller (50:49)

Okay, that makes great sense. And I think the other part of my question. If you have time. My husband feels so guilty about his student loans. I, of course, feel guilty about the whole bio debt situation. I know that we can rally and fight us together.

Dave Ramsey (51:06)

Did you know the student loans were there when you got married?

Caller (51:09)

Yes, I did. Yeah.

Dave Ramsey (51:11)

Why would you feel guilty? You signed up for the trip.

Caller (51:15)

I know I tell him this, but I think he. I think he also brings that up whenever I bring up budgeting or money, and it always ends in a fight. And I don't know that that's his default, per se, but it, you know, he kind of clams up, fight about just that I want to have a budget, and I'm probably too aggressive and frugal, and he's more. We haven't spent any money in the last three years, but we're just. I think it's usually that he just doesn't want to talk about it. It's not something he likes to talk about.

Dave Ramsey (51:49)

Yeah, well, that needs to change. That's part of him growing up here. Part of his sobriety. Part of his continued sobriety is good to face the demons and knock them out.

Caller (51:58)

Yep.

Dave Ramsey (51:59)

That's like grown man stuff. Grown girl stuff.

Caller (52:01)

How would.

Caller (52:02)

How could. So I don't know how I can't be Dave because I'm me. What would you suggest I say? Or how should I approach it?

Dave Ramsey (52:12)

Look, we both brought things into this marriage and our vows, and we both knew about them. And our vows said in sickness and in health, for better or for worse. And we've had that. We pretty much got some of the worst coverage. So now we get to lean in on the better. You know, we got some of the. We got some of the worst in the rearview mirror pretty early, so now we can lean in on the better. And the better is let's tear these student loans up and let's beat the crap out of. Metaphorically. Bio dad.

Rachel Cruze (52:38)

Yeah. And it's not who he is. Right. From an identity standpoint, I think so much like our net worth becomes our self worth. And it's like his self worth, he feels so crappy with his decisions. But the two are separate.

Dave Ramsey (52:50)

Right?

Rachel Cruze (52:50)

You make stupid decisions with money. It's not who you are, it's just what you've done.

Dave Ramsey (52:54)

Yeah, I filed bankruptcy.

Caller (52:55)

And he.

Rachel Cruze (52:55)

He should. And to tap into that part of him and his sobriety and the plan that he worked, I'm sure through AA and different things, like getting to that level of identity of who I am, that I'm not my addiction, I'm not my debt. That's not who I am. But now I need a plan to get out of it, to actually see hope on the other side, which is what you're trying to do with the budget and all of it.

Dave Ramsey (53:16)

I think you keep talking about it.

Rachel Cruze (53:17)

And appreciating it and the encouragement. Yeah.

Dave Ramsey (53:20)

And if you need to sit down with a counselor to get some common lingo, there's no shame in that. That jump in, call the people at Better Help or something and get some help.

Sponsor/Announcer (53:40)

Hey, guys, if you're already shopping at Aldi, way to maximize your grocery budget. Good for you. Now here's how to level up your savings. Make Aldi your first stop every week. From fresh organic produce to grass fed beef, to marinated chicken that's ready to cook, to high quality dairy products, you'll be able to snag everything you need without the hassle and nonsense. Just legit quality and low prices. And families like yours can save up to $4,000 a year just by shopping at Aldi. And that's not a hack. It's just a smarter habit. So stop overpaying. Make Aldi your first stop for groceries and watch the savings stack up. Find a store near you@ Aldi US that's a L D I US savings. Based on regional analysis of Aldi versus select competitors. Prices may vary by location, product availability and the market.

Caller (54:25)

It.

Dave Ramsey (54:34)

Today's question of the day is brought to you by why Refi? If your private student loans are in default, it can feel like nobody will work with you. But why Refi was built for this. They'll help you explore a fresh start. Go to yrefi.comramsey that's the letter. Yes. F y.comramsey not available in all states.

Rachel Cruze (54:55)

All right, today's question comes from Dennis in Florida. During a recent show, you told parents that their children are not morally or ethically obligated to take care of the parents. How do you reconcile that with First Timothy 5, 8? Anyone who does not provide for their relatives and especially for the for their own household, has denied the faith and is worse than an unbeliever. As a Christian, shouldn't we teach financial responsibility from a stewardship of with love and compassion in that perspective?

Dave Ramsey (55:26)

Okay, a question that is not a question, but that is actually a statement is called passive aggressive, but I'll answer it anyway. Okay, so you're trying to teach me the Bible. I appreciate that. So to start with, it says your own household and your relatives, okay? Your own household is not your parents. Your household is the children that live under your roof and your spouse, that's your household. Your parents are not your household. Okay, so who does not provide for their relatives? Now, we would never suggest that you not provide for your relatives food or some basic care as long as there is reasonable behavior involved. But the same writer as First Timothy, which is Paul, also said, those that don't work shouldn't eat. And Jesus said, if you're faithful with the little things, you'll be given more to manage. And Proverbs says the diligent prosperity and, and, and, and, and so Scripture, when it comes to this issue, this type of issue is full of cause and effect. If you sow sparingly, you will reap sparingly. So if you plant three grains of corn, please don't expect a bumper crop, okay? In other words, our actions have consequences. So in what condition would you need to take care of your Parents, it would be if they had not done the things that the Bible teaches them to do with money and so they have none. That would be the condition. Okay, so for instance, there is no moral or ethical obligation for Rachel to take care Rachel and Wisdom to take care of Dave and Sharon, nor will there be a mathematical need for her to take care of us. And by the way, there's not a moral athlete or there's not a mathematical need for me to take care of her and Winston either because they've done a great job with their own life and have been responsible with the cause and effect world that the Bible outlines and that we all live in. So it is not compassion to say that carte blanche, you should always take care of your parents. That's not compassion at all. Now. So I disagree. That is not a compassion perspective. Love or compassion, either one. Love has mixed in it truth. And the truth is you should save for retirement so that your children don't have to take care of you. The truth is you should live on less than you make. The truth is you should get up and go to work. Work. Yeah. These are all truthful things. Now, if I've got an 80 year old lady that calls in here or a guy calls in here and his 80 year old mom has zero money because they didn't do a good job with their money and dad has died and she's trying to live on Social Security and he says, I want to give her a few thousand dollars a month and I've got $2 million to make sure she's got food. I never tell them not to do that. I've never in the history of the show told him not to do that. That is an act of compassion and act of love. And I would do that myself in that situation. But the idea that carte blanche across the board that the Bible teaches we're supposed to take, we're supposed to feed our parents in retirement, regardless of how contrary and lazy and slothful and drug induced they've been, is not a biblical teaching, Dennis. So that's just not what the Bible is talking about here. So. Yeah. And by the way, we do teach, first things you do with money is you take care of your household. We teach that. And if you've ever read the book I wrote, there's a bestseller called the Legacy Journey. The first thing we teach is to take care of your own household.

Rachel Cruze (59:26)

Not MasterCard, not the suit, like you feed and make sure your household has food, shelter, facilities. Yes, exactly.

Dave Ramsey (59:33)

And so all of that lines up with this particular.

Rachel Cruze (59:37)

And Dennis, and honestly too, I think some of the. I mean, we get a great situation like what you just outlined of like you got 2 million bucks, your mom. Mom, you know, has nothing. The dad is that. And yes, you have the ability to take care of her. But the. Also the truth is 40% of Americans can't even cover a 400 emergency in cash. So the real truth is most people can't even take care of their own household, let alone someone else's. And then they feel this horrible obligation of, oh my gosh, everyone around me, for some reason I have to be the hero in everyone's story when you can barely take care of your own household. So getting your own household in order is priority. And if you're able then financially not to sink your ship in order to help someone else. Absolutely. And we talk about that all the time. Generosity is. We tell you to freaking give at the top of everything. Like, you know, so like there is that level of generosity, but you have to be wise about it. And in these relational situations. And I think some people feel. Yeah, like they have to. And they can't even take care of their.

Dave Ramsey (60:32)

A lady called Deloney and I Yesterday and her 80 year old mom, the kitchen was. Her kitchen was messed up. The 80 year old mom. And the lady said, I need to borrow $10,000 to buy my mom a kitchen because the lady was broke. And no, you can't do that. Can't do that. Well, you're not compassionate. Yes, I am compassionate. We have to figure out some other way. And I came up with some other ways to fix the lady's kitchen. Okay, but this idea that if you live your life on the basis of the way this guy is interpreting this scripture, it means that you don't have to plan for the future because your kids will take care of you because the Bible demands it. And that is false. The Bible does not demand that. That's what I'm saying. When you say carte blanche. I don't have to save for retirement. My kids will take care of me. Have you heard people say that? I've heard people say that. That is not a biblical statement. And that's the way this is reading out in this email.

Rachel Cruze (61:28)

Yeah.

Dave Ramsey (61:29)

So no, sorry, Genesis, wrong answer, wrong question. Whatever it was that you did here, it's a great.

Rachel Cruze (61:36)

It's a good question. I mean, it's a fair care.

Dave Ramsey (61:38)

It's a good discussion to have because there's always this angst between, well, I want to care for the people I love. Yes, and how far do I go? Giving a drunk a drink? Yeah, you know, I mean, okay, you know, they're, they, they would demand to stay in an $800,000 house that's paid for, but they have. They're trying to live on Social Security and they can't buy food. So is it Christian love to support that? Ridiculous. No. You sell the $800,000 house, you buy a $400,000 condo, and you buy some groceries. That's what you'd do if your kids weren't there to prop you up. And in that case, I would say you're not morally or ethically obligated to take care of your parents in the middle of their stupidity. No, they're making dumb decisions and I'm not going to support that. And the Bible does not call for you to do that. God does not call for you to do that. But it does call for us to be kind in the process, to be.

Rachel Cruze (62:37)

Gentle and to be generous people. When you, you know what I mean? When you have the ability.

Dave Ramsey (62:41)

When I can. Real generosity changes the situation. It doesn't put a mask over the problem.

Rachel Cruze (62:49)

Yes, bad behavior. It's not a band aid. That's not the point of generosity.

Dave Ramsey (62:52)

That is not real generosity. That is fake generosity. That's shaming. And so, but I, and Dennis, the reason I'm kind of leaning in on this, I think this is what you were saying, but I may be giving you too much flack here. I'll give you. I'll back off a little.

Rachel Cruze (63:06)

It does say today's question. So he had to make it in the form of a question.

Dave Ramsey (63:11)

Our statement says today's question. But no, he's making a statement. But the thing I don't want people to buy off on is this idea that you do not have to be responsible because your children will take care of you. That's not correct. Okay. And that is not compassion and that is not love by anyone involved in the conversation. Real love would say, no, you have to be responsible. Real love would say, I choose to be responsible so that I'm not a burden on my kiddos. That's real love and real compassion and real maturity instead of a cop out. And so, yeah, that's why we say that. Finish. Hope that helps you.

Sponsor/Announcer (64:30)

For way too long, I struggled with sleep and woke up groggy after tossing and turning all night. But now I look forward to bedtime. And I wake up bright eyed and bushy tailed thanks to Casper, a company that's been perfecting better sleep for over a decade. Using durable, high quality materials that actually last. My whole family now sleeps on Casper mattresses. Yes, even the dogs have their own Casper dog bed. To no one's surprise. And it's not just one man's opinion. Casper customers keep their mattresses for years. And 4 out of 5 customers recommend them to friends. And with free delivery and 100 night trial, Casper is no gimmicks. A mattress you can trust backed by quality that lasts. So go to Casper.com Ramsey and use promo code Ramsey to receive 25% off all mattresses and 10% off everything else. Else with code Ramsey. That's Casper.com Ramsey exclusions apply.

Dave Ramsey (65:47)

Tom is with us in New York. Hey, Tom. How are you?

Caller (65:51)

Good. How are you, Dave?

Dave Ramsey (65:52)

Better than I deserve. What's up?

Caller (65:55)

So I've got a question. My wife and I, we just bought a house in March and we owe like 440 on the mortgage and we don't have any other debt besides that. But we have a brokerage account that we have some money in in. She wants to use probably half of the majority of it on a bathroom in the basement that's finished. I would rather either put it towards the mortgage principal or look into refinancing or recasting the mortgage. We don't know which one's the best route to go.

Dave Ramsey (66:25)

What's wrong with the mortgage? Why would you. Rates have dropped since then. To get a better deal.

Caller (66:31)

We're at 7% right now.

Dave Ramsey (66:33)

Okay. And so you could get 5, 7. So you can save 1 point. You save 1.3 if you want on 15 year right now.

Caller (66:40)

Okay.

Dave Ramsey (66:40)

Okay. On 440. Okay. And how much is in the brokerage account?

Caller (66:45)

About 85.

Dave Ramsey (66:46)

And why did you not put that down on the house in the first place?

Caller (66:51)

It was kind of like a timing issue. We sold our old house and we use equity in there as a down payment to get the 20%. So we avoided the PMI. Then we just threw that in the brokerage account.

Dave Ramsey (67:06)

So it wasn't a timing issue. It was a decision to not put it all down on the house, instead put it in a brokerage account.

Caller (67:11)

Yeah, I guess so.

Dave Ramsey (67:12)

Yeah. Okay.

Caller (67:17)

Her reasoning for the bath, the. The bathroom in the basement is we have a young child a year and a half and one on the way. And as they get older, you know, the plan is to have them kind of be down there.

Rachel Cruze (67:31)

But Tom, that'll be in like four to five years.

Dave Ramsey (67:35)

What's your, what's your household income?

Caller (67:39)

About 260.

Dave Ramsey (67:41)

Okay.

Rachel Cruze (67:42)

How much of the bathroom Renault cost.

Caller (67:45)

I'm gonna estimate like 50 grand.

Rachel Cruze (67:48)

Okay.

Dave Ramsey (67:49)

It's a nice bathroom.

Caller (67:51)

Yeah.

Dave Ramsey (67:53)

Okay, but that's your. You've not really actually gotten a bid, right?

Caller (67:58)

We haven't, like, got any, like, any contract or anything to give us actual quotes yet, just from what we've looked at.

Dave Ramsey (68:03)

And do you have an emergency fund in addition to the brokerage account?

Caller (68:08)

Yes.

Dave Ramsey (68:09)

Okay. All right. All right. Well, if you had. This would not be a question. If you'd have put it all down on the house, because then if you had done that, you'd have a lesser mortgage. And then the only question would be whether it makes sense from an interest rate perspective to refinance your mortgage. And you say, oh, we don't have any money, so if we want to do a bathroom, we have to save up money out of our $260,000 income. Right. So I'm trying to back into that and go, okay, what does that tell me about where I should go now?

Rachel Cruze (68:46)

Yeah, I mean, I throw the 85. Tom at the house, you guys, cash flow, the bathroom. And again, you're. You guys have. You're gonna have a newborn. I mean, I just know this from experience. I have a 10, 8 and 6 year old, so I'm like. I mean, for the first. I mean, you don't really leave them alone playing by themselves until, like, you know, four ish down in a basement, you know what I mean? Where they can play and they're gonna be okay. And they can get. I mean, so you guys are a few, you know, two years or so out of even needing that bathroom down there because the kids, quote, unquote, need it. Do you know what I'm saying? I'm like, it's not urgent to me.

Dave Ramsey (69:18)

So out of 260, you ought to be able to pay for the bathroom in one year.

Rachel Cruze (69:21)

Yeah, I can't do it. I would say in. But yeah, I would. I would. Give yourself a beat. And I kind of do hate too. There's a level of like, the contentment side. Tom, of you guys just bought this house. You're in a brand new house since April, and it's been what, six months? And you guys are already like, okay, what else can we do? What else can I know? A part of me is like, just be. Just be for a year. Y' all are okay. You know, there's no. There's no urgency in it.

Dave Ramsey (69:42)

Actually, both things could sit for a year. Neither one would because 1.3 savings on your interest rate is good, but it's not huge. So.

Caller (69:55)

You think rates are going to come down further, too? That's another question.

Dave Ramsey (69:58)

Yeah, probably. I predict that seems to be indicating that all the pressure is that way with the Fed direction and everything else. So probably. But, you know, you understand that weather forecasters and economists are the only ones that can be wrong most of the time and still keep their job. So we don't know is the bottom line. But ye. So, okay, what would I do? All right, Number one, I think that she doesn't think she's ever going to get a bathroom if we don't use this method, because you all are probably not on a good detailed written budget, and she can't see how 260,000 leads to a $50,000 bathroom. I can see that. But the way you all are handling money is not signaling her that that's going to happen. So I think you're going to have to get a detailed written plan that the two of you together say, all right, we're going to save $4,000 a month, and in 11 months we'll have the money. 12 months we'll have. And in the meantime, we're going to get actual bids from contractors and figure out what we're going to do. We're going to pick everything out, and as soon as we have the money saved over the next 12 months or so and we have the budget and we have everything dialed in a detail about what we're going to do, what we're not going to do, we're in agreement on all of that. By then we'll have the money saved, and together we're going to accomplish that by not eating out as much and maybe not doing that trip and doing a few other things. And then I am going to take the 85 and I'm going to refinance the mortgage, reduce the mortgage balance by $85,000 and get a lower interest rate, get in touch with Churchill Mortgage and all that.

Rachel Cruze (71:42)

Next you're saying wait a little bit?

Dave Ramsey (71:44)

No, I'd go and do it now.

Rachel Cruze (71:45)

You would do it all now?

Dave Ramsey (71:45)

I'd refinance the mortgage now.

Rachel Cruze (71:47)

You would. You wouldn't wait to see if.

Dave Ramsey (71:48)

No, I mean, if you want to wait two months or something, that's fine, but I'm not going to wait a long time because they should have put down the 85 in the first place.

Rachel Cruze (71:55)

Yeah.

Dave Ramsey (71:56)

And so I'm going to undo that. And if I had done that in the first place, what would be the way I do the bath, the way I just described? So what I'm the Way I backed into the answer, Tom, is what we would have told you to do if you'd have called it and ask us in the first place. We would have said put the whole amount down and do the bathroom later or buy a different house that you don't need a bathroom down there. Would have told you one of those two things if we'd have been involved in the conversation early. And so all I can do is go back to the last time that we were standing on solid ground and go from there forward. And that's the way I'm analyzing this. And that's how Sharon and I would make the decision. And Sharon would be perfectly fine. And Sharon loves to do upgrades. Like decorating. Upgrades are like her love language. Okay. So if that is an actual spiritual love language. But, yeah, if there is one, she's got it. And she doesn't mind if we tap the brakes on that. As long as I'm not over here spending the same amount of money on something else that she doesn't agree with. No, wait a minute. You chose that over me? No, we're not doing that. But on the other hand, if we were in this case, and we said, okay, we're gonna buckle down the budget. We're gonna save up the money, we're gonna do the bathroom album. We've done that bazillion times in the Ramsey household, and she would not be complaining about that. But if she didn't see how we were going to get there.

Rachel Cruze (73:21)

It's a great point.

Dave Ramsey (73:22)

Then she would have a problem.

Rachel Cruze (73:23)

Yeah. Because if she has hope that, yes, I will be able to get a bathroom in a year, then we're gonna be okay. And I mean, you guys know this. Tom, I'm sure. But those renovations can swing dollar amounts so far. Depending on scope.

Caller (73:38)

Creep.

Rachel Cruze (73:39)

Yes. Depending on materials you pick. Finishes all of it. So just be aware.

Dave Ramsey (73:43)

Bathroom becomes a sun room.

Rachel Cruze (73:45)

And if it's the bathroom where two kids are going to be, don't make it nice. I'll just say that much. Bathroom off of our playroom. Nasty, nasty, nasty. Clean it.

Dave Ramsey (73:57)

But it's a hazmat.

Rachel Cruze (73:59)

Because they'll be learning to. Yeah, they'll potty train in that bathroom, Tom.

Dave Ramsey (74:02)

So just hazmat.

Rachel Cruze (74:04)

Just pure hazmat. Especially if you got boys.

Dave Ramsey (74:08)

Did I say hazmat is crazy?

Rachel Cruze (74:10)

It's crazy. You know, this could be a different podcast, but I'm like, I don't get.

Dave Ramsey (74:14)

That should be.

Rachel Cruze (74:15)

How. How did that happen, Charles? How did that. I don't.

Dave Ramsey (74:21)

How did that get there?

Rachel Cruze (74:22)

How did that happen? Y', all. Can we.

Dave Ramsey (74:25)

We got.

Rachel Cruze (74:25)

We got like 30 seconds. I probably shouldn't tell it.

Dave Ramsey (74:28)

No, don't, don't.

Rachel Cruze (74:29)

Okay, okay.

Dave Ramsey (74:30)

I'll tell it anyways.

Rachel Cruze (74:31)

And so by this, I'd tell it.

Dave Ramsey (74:32)

This stuff, this stuff gets keep in.

Rachel Cruze (74:34)

A candle on our porch last weekend. I'm like, charles, what are you doing?

Dave Ramsey (74:39)

He was like, putting out the candle.

Rachel Cruze (74:40)

He said, I don't know, it kind of looked fun. And I was like, gross, Gross. So anyways, that's. That's potty training for you boys. I don't get it.

Caller (74:59)

Sam.

Dave Ramsey (75:42)

Hey, don't just set goals in 2026. Learn how to reach them. The 2026 Ramsey Goal Planner is here. We've got just a few of them left. They're packed with monthly content from Jade or Rachel or Deloney each month to help you stay on track with your money, your faith and your relationships and, and follow through on your goals. We sell them out every year. Did I mention that? So don't wait. You get yours for 49.97. These things are beautiful. They're well designed. @ramseysolutions.com store or if you're watching, of course on YouTube or podcast, just click the link in the show. Notes. Chris is in Washington, D.C. hey, Chris.

Caller (76:19)

Hey, Dave. Thanks for taking my call.

Dave Ramsey (76:21)

Sure. How can we help?

Caller (76:23)

Well, I'm in a bit of a unique situation. I'll be retiring at the end of the month at the age of 50 from the federal Law Enforcement Retirement System. I am getting a second job. So I'll be working a job and collecting my pension from that.

Dave Ramsey (76:37)

Wow.

Caller (76:37)

I have. Yeah, I have 1.4 million in my tsp.

Dave Ramsey (76:41)

Wow.

Caller (76:45)

Started wise advice when I first got on the job, put as much money into it as I possibly could. So it's grown quite a bit. So based on the rules within the Federal Retirement System, I can withdraw on that penalty free upon retirement. So we're thinking, myself and my wife, about withdrawing $300,000 from it to purchase a late property, which we've been interested in doing for a while now. We would then cash flow the development of it over maybe the next five years and maybe eventually build a house at the end of that five years. But we'd probably sell the one we're in to do that or make another decision, finish paying off this mortgage, decided to build a second house. I just was wondering if it's a good position. It's just a lot of money, Right. And I know I'm going to have to pay tax on it. So just wondering what your thoughts on that were.

Dave Ramsey (77:45)

You have other money other than the million, what's your home worth?

Caller (77:50)

My home is worth about 950,000.

Dave Ramsey (77:53)

And you owe how much on it?

Caller (77:56)

270.

Rachel Cruze (78:03)

You got them, Kris, with the lake.

Dave Ramsey (78:05)

Property, I'm just thinking the problem is this. The downside is that the upside is you've done or the positive is you've done an incredible job saving money and you're in a very, very good position. You're a millionaire and you retired at 55 years old. Way to go. I'm proud you of what have you. Absolute rock star. Very cool. Now then I start to think about, okay, if I'm going to buy a second property with 30, more than 30% because I got to pull more than that out to pay the taxes. Unless you could cash flow the taxes. But if I'm gonna pull 30% of my nest egg out to buy a second home for enjoyment. But what's bothering me is I don't get the enjoyment because there's not a house. It's just dirt and it's going to be developed and the house is not going to appear for another five or six years in what you outlined.

Caller (78:58)

True.

Dave Ramsey (78:59)

So I'm not getting anything except some dirt right now. If I got a lake house and I got enjoyment today you found a little lake cabin for 300 grand and you did it. It would feel different to me because you could actually go do it. But this is like you've done such a good job delaying pleasure to get to a right result. Now you're doing it again. There's no. But you're, you know, we can only kick pleasure down the road so far. We need to. We need to eventually have it. And gosh, that's the only thing that's bothering me about it.

Rachel Cruze (79:32)

Was there something specific about this one property, Chris, and like this, a specific lake, a specific area of the lake. Was there, I don't know, ties to it or you just saw it and thought, oh, this would be a good spot.

Caller (79:44)

What? No, we've been thinking for a while, so definitely the specific lake. And we've of course seen prices go up exponentially. And my concern would be they continue to go up over the next five years.

Dave Ramsey (79:56)

They will.

Caller (79:56)

Instead of getting there.

Dave Ramsey (79:57)

Yeah, well, the, the. Or they'll go down dramatically because let me. Yeah, I own a lake house and we. And the. The worst category of real estate and the best category of real estate for price is resort property. So Beach, Mountain Lake. Those are the ones that go through the roof when times are good faster than single family regular houses do. And they go through the floor as soon as things turn sour. And so they follow the luxury jet market. And so it's way up or way down. It's very volatile. And so, I mean, there's been years that my lake house was kind of sad and then there's been years it was one of the biggest things I owned, you know, because it just shot. People were crazy all of a sudden and, but. And it comes and goes in waves. It's very emotional. Buying public for that. The overall answer is I probably would do it. The only thing is there acreage involved. Like you're going to sell off lots. You said develop ac.

Caller (81:07)

It's lakefront. It's in a, you know, it's an undeveloped lot on the lake.

Dave Ramsey (81:12)

What does develop mean? I mean, how big a lot is it?

Caller (81:15)

Clear it. Two acres.

Dave Ramsey (81:16)

Oh, you've just got to clear it. So it's not really. You just gotta, you gotta get it ready to build on this all. Yeah, but you could do that. And you don't have to do that over three years. You could do that in 10 minutes.

Caller (81:26)

Well, probably a dozer chainsaw docking. You know, I'd probably put the money towards a dock before I built the house, but.

Dave Ramsey (81:34)

Okay, yeah, I would do that. Yeah.

Caller (81:35)

But I'm gonna continue to contribute to another 400, 401k in my post retirement job as well until I fully retire.

Dave Ramsey (81:44)

Yeah. So what will your household income be with the new job, the old pension and your wife?

Caller (81:51)

350,000.

Dave Ramsey (81:52)

Okay. Yeah. Okay.

Rachel Cruze (81:58)

So you can build it back up pretty quick. Right. If you took the 300 out you.

Dave Ramsey (82:02)

And you don't move to the lake until you all just quit. Right, Right.

Caller (82:06)

Yeah.

Dave Ramsey (82:06)

I mean, that's what you meant about selling your house, correct? Yeah, Yeah, I think, I think you do that. I like I'm catching up. It took me a minute, but yeah, let's clear it, put the dock on it and. But let's move towards building sooner rather than later.

Caller (82:25)

Even. Like that plan.

Dave Ramsey (82:26)

Even if you don't move down there, even if you just go there for two weeks in the summer or three weeks in the summer, plus weekends and that kind of stuff. And yeah, sooner rather than later. So. But yeah, I think the numbers are going to work out fabulously for you and you guys have been so responsible in the other areas that it leads me to believe this is all going to work out probably. I think you're being conservative on how fast you're going to be able to do this because you're just really. Y' all have done an excellent, excellent job. Yeah. That's so Federal government employees, ladies and gentlemen. 55 years old, retired four, I think 50.

Rachel Cruze (83:07)

He said even.

Dave Ramsey (83:07)

What?

Rachel Cruze (83:08)

I think he said 50.

Dave Ramsey (83:09)

Oh, 50. 50 years old. That's right. Fully retired with over a million dollars in tsp, the Thrift Savings Plan. Okay. Starting from nothing and has a $900,000 house that's only got 200,000 owed on it. So he's got a million half net worth. Million seven hundred thousand net worth at 50 years old. That's a classic model of a baby steps millionaire. That's the classic model. Now somewhere in there too, I've got to get this other house paid for. Gotta get that mortgage paid off. This other thing scratching my head in the back of this. So there we go. But yeah, that's good. That's living like no one else so that later you can live and give like no one else. But at no point do you get to live and give like no one else without using wisdom. So to his credit, he's asking for wisdom on how to best do this.

Rachel Cruze (83:56)

And he's a laid grad. I mean, if you heard him earlier, earlier in the call, he said, you know, people told me early to put as much in the tsp, and I, you know, there's a diligence about him that makes you say on the other side of this decision, he's. He's gonna follow through. He doesn't. His character follows through.

Dave Ramsey (84:12)

Yeah. This is not, this is not a guy who jumps from thing to thing.

Rachel Cruze (84:15)

No, no.

Dave Ramsey (84:16)

Doesn't lose focus. Yeah.

Rachel Cruze (84:18)

Because within, because you can take out. What is it within your 401k. Oh, this is not the growth. No, I know, I know, but you can. Without penalty of what you put in. Not the growth of it.

Dave Ramsey (84:28)

No, only if it's Roth.

Rachel Cruze (84:29)

The Roth Roth ira. You can. Okay. Tsp. Is there anything that you can take out without. Without penalty? So the whole thing will be.

Dave Ramsey (84:35)

There's no penalty on this. It's only tax.

Rachel Cruze (84:37)

It'll only be taxes because if he.

Dave Ramsey (84:39)

TSP is Thrift Savings Plans for federal government employees only.

Rachel Cruze (84:42)

And once you reach retirement age, if.

Dave Ramsey (84:44)

They retire, like he's probably got in his 20 years.

Rachel Cruze (84:47)

Yes.

Dave Ramsey (84:48)

Or his 30 years or whatever. When you retire, you no longer work there. The tsp, the, the penalty is taken off of it.

Rachel Cruze (84:55)

Okay.

Dave Ramsey (84:55)

And it can take it out, but it's unique only to that it doesn't apply to 401k.

Sponsor/Announcer (85:27)

What's up guys? George Camel here. If you've been thinking about making a real difference in your community, this is your moment. People are drowning in money stress right now and you can be the one who helps them by leading a Financial Peace University class. It's totally free for you and we hook you up with all the tools and support support you need. So if you're ready to help people ditch debt, save money and actually sleep at night, go to fpu.comlead to learn more. That's fpu.com lead.

Dave Ramsey (86:10)

Welcome back to the Ramsey show in the Fair Winds Credit Union studio. I'm Dave Ramsey your host. Rachel Cruz Ramsey personality number one best selling author. My daughter is my co host Alexander is with us in Idaho. Hi Alexander. How are you?

Caller (86:26)

Better than I deserve.

Dave Ramsey (86:27)

Cool. How can we help?

Caller (86:29)

I'm just trying to figure out if how much of a step back it would be to my life if I were to purchase a 2025 Harley Davidson writer s. Thank you. You actually know what that one is?

Dave Ramsey (86:43)

Yeah. What's the, what's the tag on that? What's the price on that?

Caller (86:47)

You know MSRP is about 24, but I'm gonna put some upgrades on it. Pipe and kitty grips and all that good stuff. Probably about $30,000 out the door.

Dave Ramsey (86:55)

Yeah. So what do you make?

Caller (86:57)

Right now I'm making about $65,000 a year and then my wife makes about 15. She works about 10 hours a week. Week.

Dave Ramsey (87:07)

I assume you each have a car?

Caller (87:10)

Yes, I have a truck and she has a, she has a, you know, a crossover.

Dave Ramsey (87:16)

Yeah.

Rachel Cruze (87:16)

What kind of debt do you guys have currently?

Caller (87:20)

No debt. We are actually on baby step six and 35 we have with two little kids. There's a, there's a couple kickers about, about that though. I guess the first one would be that right now we're spending more than we make because you know.

Dave Ramsey (87:41)

How would you pay for the Harley?

Caller (87:43)

Oh, just, just extra money. So about, about two years ago we were gifted about $200,000 from Sarah's grandmother when she passed away or my wife.

Dave Ramsey (87:56)

How much?

Rachel Cruze (87:58)

No debt. But they're living above. How are you living above your me? You're spending more than you make.

Dave Ramsey (88:02)

Make why?

Caller (88:03)

We, we saved a lot of money prior to having children and we are.

Rachel Cruze (88:08)

Only going to pulling out a savings every month too.

Caller (88:11)

Pulling out of savings every month? How much roughly? About $1,000 a month.

Dave Ramsey (88:16)

Why can you not live on $85,000.

Caller (88:21)

You know, tithing and 15% for retirement.

Dave Ramsey (88:26)

And, and restaurants and restaurants and travel and vacation and restaurants.

Caller (88:32)

I'm doing a whole lot of that.

Dave Ramsey (88:33)

Yeah, you are. You're doing something because the tithing does not cause you to not be able to make your budget. That sounded real holy, but I'm not buying it.

Caller (88:41)

Yeah, our mortgage is about fourteen hundred dollars a month.

Dave Ramsey (88:45)

That's not, that's not killing you. Okay, well, anyway, so here's the thing. I but love almost anything that has a motor. And it.

Caller (88:57)

Sure.

Dave Ramsey (88:58)

Which is kind of why I don't like Teslas, because I like almost anything that has a motor in it. And so that bike is very cool.

Rachel Cruze (89:06)

My Tesla will be his bike and your car in a race. I'll just say that.

Dave Ramsey (89:10)

Go ahead and. Oh yeah, well, that's not a. Anyway, it's a very cool bike. And so what I'm trying to say is I completely understand why your adrenaline is up when you think about.

Caller (89:24)

About it.

Dave Ramsey (89:25)

And I can get that way about a myriad of different things with motors in them. Everything from a skid steer to a ski boat. Right. So I get it. But I will also tell you that as a young man with two children and hasn't figured out a way to live on $85,000 a year to invest $30,000 in a motorcycle that's going to be worth 15,000, brand new one. $15,000 and about an eye blink is not a good investment. You're not in a position to afford this.

Caller (89:55)

But I guess a little bit more with our finances. I mean, we owe about 250 on the house. Cross is worth about 450. We have a little over $210,000 combined in the work retirement accounts. And right now we got about $150,000 in a separate mutual fund with about $80,000 in an emergency fund.

Dave Ramsey (90:16)

You have too much in an emergency fund and you should pay off your mortgage. You're sitting on 200,000 worth of inheritance. 150,000 in a mutual fund, $80,000. That's enough to pay off your mortgage. Why do you still have a mortgage?

Caller (90:30)

I think that's kind of one. One thing my wife and I guess disagree on. I'm kind of on the, on the plane of mortgaging, you know, paying off the mortgage. But then when we first received the money and she was kind of along the lines of, you know, just to be safe, to put it, put it in mutual money.

Dave Ramsey (90:49)

There's nothing safer than a paid off mortgage. Sure, it's much safer than a stock market investment.

Caller (90:56)

I know. But if, I guess, I guess devil's advocate here because Okay.

Dave Ramsey (91:01)

I don't. I don't think we're gonna be able to help you, honey. No, I would not buy the motorcycle. You're too broke to do it, and you can't learn. You haven't learned to live on less than you make. No, I would not do it. Holly is with us. Holly's in North Carolina. Hey, Holly. How you are? How are you?

Caller (91:14)

I'm good. How are you?

Dave Ramsey (91:16)

Better than I deserve. What's up?

Caller (91:19)

I'm calling because I have a situation with my eldest daughter where she made an agreement with my husband and myself, along with her two sisters, to pay her student loans after graduation that we took out for them. They are parent loans, but the agreement was that they would pay them when they graduated, just as we had paid for our education. My husband and I are both nurses, and we put ourselves through school, and they disagreed with how the money would be spent for college. We wanted them to stay home and commute, possibly to save money, but they really wanted to go away, and we said, the debt is on you. We did help them through college with other expenses along the way. It wasn't like we just abandoned them. And we continued to provide for my younger daughters here and there. My oldest daughter now is refusing to pay her loans and do good on her agreement with us. It was a verbal agreement. Her sisters are paying their loans. They know that it's their responsibility. But my oldest is refusing to pay the loan.

Rachel Cruze (92:31)

What is she saying?

Caller (92:33)

She's saying that she doesn't care, that it's our problem, and she has cut off communication with us. So we have been told that we have no recourse.

Dave Ramsey (92:46)

You do not have any recourse.

Caller (92:48)

Right.

Dave Ramsey (92:50)

You borrowed the money. She didn't borrow the money.

Caller (92:53)

Right, right. I know, and I've accepted that. My. It's upsetting, though, because it's almost a moral issue.

Dave Ramsey (93:03)

Yeah, it is. You shouldn't have done this to your daughter. You put her in debt to you.

Caller (93:09)

Yeah.

Dave Ramsey (93:09)

And you called it a blessing and acted like you did something right. You.

Caller (93:14)

No, not really.

Dave Ramsey (93:15)

No. I mean, this is a. It was a really, really, really bad idea.

Caller (93:19)

It was a bad idea, and it's.

Dave Ramsey (93:20)

Cost you guys a relationship.

Rachel Cruze (93:21)

The relationship part, so that's heartbreaking.

Dave Ramsey (93:24)

Well, what you're discovering is, is that these things. That math is not independent of relationships, that the borrower is slave to the lender, and she didn't like being your slave anymore.

Caller (93:35)

Well, she wanted to go to college, and it was the only way to pay for it.

Dave Ramsey (93:38)

No, no, it wasn't no, she wanted to go to a certain college and it was the only way to pay for it. And you end something you didn't believe in by borrowing the money in your name to do it.

Caller (93:47)

I think you misunderstand me.

Dave Ramsey (93:50)

You said she could go to a community college and pay for it and she chose to go to a fancy college and borrow the money in your name.

Caller (93:57)

It wasn't really a fancy college. It actually was a seven year medical school program that is the cheapest probably in the country to get into. And she got into it and she was very fortunate to do that.

Dave Ramsey (94:09)

If I were in your, I would call her up and say, honey, I made a mistake, I shouldn't have done this. I call up your other two daughters and say, honey, I made a mistake. I shouldn't have done this. We're going to pay all these loans, they're in our name. We hope you children have a great life and we'll never make the mistake of borrowing money for someone else ever again. It was our fault. How many times do you end up with too much month at the end of the money? Even if you can cover the bills, there's nothing left over. You work your butt off and you still feel broken, broke. That's normal for most people. But you do not have to live that way. You can completely transform your money and your life with every dollar. Our world class budgeting app is better than ever now. Every dollar coaches you to find extra margin every month so you can make real progress and change your family tree. The Average person finds $3015 in just the first 15 minutes. That's extra money you could use to beat debt, to build wealth, to finally breathe again. Don't settle for living normal with money. Start every dollar for free by downloading the app. So we have a very popular and award winning documentary that is now free to watch on YouTube that we did a couple of years ago called Borrowed Future. We spent a lot of time delving into the student loan epic failure that is in America today now. 1.8 trillion worth of student loan debt. Where does that come from? Whose fault is that? Well, it's Congress's fault for starting the program. It's Congress's fault for not stopping the program once it was considered an abject failure. And they still have not stopped it, number one. Number two, we tried to get to the mathematical source of why people keep going into student loans, why it was normalized to take out a student loan. And you can blame that on higher education because. Because they've run the cost up through the roof. The inflation rate of higher education is about 3x the normal inflation rate. But they're building lazy rivers for college. Freshmen really are a couple of compasses have this now they can route an inner tube through the lazy river under the dorm. I mean it's unfreaking believable what they're spending money on and then they're charging it back to your children in the form of ridiculous tubes and ridiculous housing costs. So it's higher education's fault, it's Congress's fault, it's the 18 year old's fault. Because no one ever told this 18 year old no ever in their whole freaking life for anything. And so they expect to go do anything they want to do wherever they want to do it. So there's, you know, it's their fault. And then Rachel Cruz comes in and goes, you know, at the core of it though is a parenting problem. It's not a student loan problem. The parenting problem. And the reason you say said that?

Rachel Cruze (97:49)

Well, because in my head I'm like, you know, they're 18. So yes, you are a legal adult and you're signing up for something, it's your signature on it. But also you're 18 and the adults in your life should be the ones stepping in and guiding and giving you wisdom that's actually going to help you and not hurt you. And so yeah, I mean for parents to just sit back is negligence to me. I'm like, you know, step into your kids lives and talk to them about the repercussions of this. Because we get calls all day of six figure student loan debt and it's not working in people's favor. And the, and the truth is too, there's still other options. You know, you can go to community college in a lot of states now there's free community college, you know, a lot of places. And so you can go, go get your associate's degree and then transfer to a university if you want to get the bachelor's, you know, for the last two years, but save, just be wise about it. And instead it's kind of this like, well it's so expensive no one can afford it. So just go wherever you want to go. And that's the message out there.

Dave Ramsey (98:45)

I remember the first time I got that call and I just, I realized that as, that your mother and I are dinosaur parents. We're from a whole different world than some people. A guy called me from Michigan and he said my son told me he is going to this college that we can't afford. And I thought to myself, you know, that's different because when it comes to my money, the 18 year old doesn't tell me anything. I tell them things, but they don't tell me stuff. That was my first reaction, is the parents are wusses. They're enabling wusses. Instead of actually having a backbone and going, how about no is a complete sentence, no. And like integrity. I meant it. No. And then we can explain why. Maybe if I have to. But like, you know, probably good parenting.

Rachel Cruze (99:39)

Yes.

Dave Ramsey (99:40)

So, I mean, here's an example, okay. One of our children, which won't be named, almost left the family because that child decided they were going to apply for colleges other than the University of Tennessee. And so they got accepted into a SEC school. Mississippi?

Rachel Cruze (99:55)

No, Auburn.

Dave Ramsey (99:57)

Was it Auburn. Okay, Auburn, almost as bad. And so another SEC school, but it's slightly across the state line, lines like 50 miles. And at that time it was triple the tuition.

Rachel Cruze (100:10)

It was double.

Dave Ramsey (100:13)

For apparently about the same degree. So you're going to pay double because you want to go across the state line 50 miles for basically the same degree and basically about the same level of football. I mean, it's really, it's. You're going to pay double for apparently not nothing. And so the discussion was, no, well, or you got to figure out a way to pay for it. And then that person couldn't figure out a way to pay for it. And so she decided to graduate from the University of Tennessee where her parents were willing to pay for in state tuition. Go Vols.

Rachel Cruze (100:46)

Go Vols.

Dave Ramsey (100:47)

Okay, so.

Rachel Cruze (100:47)

And now I'm an alum. It's great.

Dave Ramsey (100:49)

And now you're. Now you're famous.

Rachel Cruze (100:50)

No, I, I was going to go to ut. It was a little bit of a.

Dave Ramsey (100:52)

Yeah, but it's a little bit of a flex there. A little bit of flex by the middle child. But yeah, so, I mean, we have these discussions in our house, right? But here's the thing. If your child comes in and says, I want to go to a school that we cannot afford and you say, I don't think you should, you don't go take out a parent plus loan and pay for with your signature, a decision that you think is unwise, unhealthy for them and then be shocked eight years later that everybody in the whole story is pissed at you, you caused this because you endorse this stupidity and that's the problem you get into. So there's zero chance that any of you should ever take a parent plus loan and there's zero chance that you should give a child who's going to take out student loan debt a dime of your money, money of any kind, zero support. If you leave home and go to a college on a student loan, you should tell your kid you are 100% food and everything on your own because you are stepping outside of my wisdom. I am telling you the best thing you can do is go to a school that we together can pool our money and pay cash for. And you need to study and get a degree that actually has use, not left handed puzzle puppetry. And so you're going to study something and you're actually going to go to class and pass the class and together you're going to take a job and you're going to get. We're going to go to in state tuition, we're going to go to a school we have the money to pay for and that we are in agreement on what is good for you. It does not affect me personally where my kid goes to school, I mean what degree they get. It doesn't affect me personally. And so any guidance I force upon them them or persuade upon them is an act of love. So this idea that you're going to borrow money in your name on a parent plus loan to cause your kid to go to a school that you don't think they ought to be going to. There's so many dumb things in that sentence.

Rachel Cruze (103:05)

Yeah. And not to keep extending the point, but the last caller, which I was a little shocked that I mean you laid down the law with her. Is there any moral though obligation of the daughter at all that they shook hands and had a.

Dave Ramsey (103:18)

Absolutely. She promised you if she called us we'd tell her to pay it because she said she'd pay it. She should keep her word. Yeah. You know, you can't claim victim. You were there at the party, right?

Rachel Cruze (103:29)

Right.

Dave Ramsey (103:30)

Yeah. And so if you promised your parents you would pay the parent plus loan, you should do it. But as a parent you set up a 100% guarantee that there was going to be a relationship problem because they are strange because you got involved and caused them to make a bad decision by allowing it with a you borrowing the money to do that and then expecting them to pay for the mistake that you knew they were making and you financed their mistake. Of course they're going to be resentful of that later. There's a hundred percent chance they're going to be resentful of that later.

Rachel Cruze (104:07)

Well, and what sucks is you're 18 and again your frontal cortex like isn't Even formed, you know what I mean? I'm like, you're a kid. You're like, you're 18. You're, you're a child, you know, and that's what's hard. Yeah, is they're making these massive financial decisions as a teenager and you're like.

Dave Ramsey (104:22)

Oh my God, you can't buy a gun and you can't buy beer, but you can borrow 150 grand, borrow a mortgage of. I mean, it's just freaking stupid. It's just stupid. It's all it is. It's the only thing you can call it. And so to participate in that system as parents is not an act of love. Instead you go, hey, you're going to a school we can all pay cash for and study. Something we can all agree on is good for you. And if we can't agree on all that, you're going to make 100% of the decisions on your own. You can't keep an 18 year old from leaving home and going $150,000 in student loan debt. But you can say, I'm not giving you any emotional or financial support for your stupidity because I love you, you and I'm not going to endorse you bringing harm to yourself. You can have the backbone as a parent to say that instead of going, well, they're making unwise choices and I think I'll finance it. That of course they're going to be resentful later, of course. And then don't be shocked that they are foreign.

Rachel Cruze (105:52)

Hey guys. I'm so excited to tell you that our new 2026 Ramsey goal planner is available right now. This isn't just your average planner. It's your personal guide to setting clear goals and building happiness habits that stick. So get ready for all new monthly content from your favorite Ramsey personalities, tactical goal setting trackers and upgrades that make this our most durable planner yet. Last year we sold out, so don't miss out. Order your 2026 Ramsey Goal Planner for 49.97 today@ramseysolutions.com Stor.

Dave Ramsey (106:36)

In the lobby of Ramsey Solutions on the debt free stage. Brad and Amanda are with us. Hey guys, how are you? Hi Dave.

Guest/Debt Free Screamer (106:43)

Hey, Rachel.

Rachel Cruze (106:44)

How are you guys?

Dave Ramsey (106:45)

Good to have you. Where do you guys live?

Guest/Debt Free Screamer (106:47)

Harrisburg, Pennsylvania.

Dave Ramsey (106:49)

Oh, fun. Well, welcome to Nashville and all the way here to do a debt free scream. How much have you paid off?

Guest/Debt Free Screamer (106:55)

$130,000.

Dave Ramsey (106:57)

I love it. How long did that take you?

Guest/Debt Free Screamer (106:59)

20 months.

Dave Ramsey (107:00)

Good for you guys and your range of income during that. Two years.

Guest/Debt Free Screamer (107:03)

170,000 down to 120.

Dave Ramsey (107:06)

Okay, cool. What do y' all do for a living?

Caller (107:09)

I work in construction and I'm a nurse.

Dave Ramsey (107:11)

Okay, cool. So why the 50 drop? That's interesting.

Guest/Debt Free Screamer (107:15)

We had a baby.

Dave Ramsey (107:16)

Oh.

Guest/Debt Free Screamer (107:17)

So I'm mainly a stay home mom now.

Dave Ramsey (107:19)

Oh, okay. So you've kind of gone to part time or no time?

Guest/Debt Free Screamer (107:22)

Prn.

Dave Ramsey (107:22)

Yeah. I love it. Good for you.

Rachel Cruze (107:24)

How the baby?

Guest/Debt Free Screamer (107:25)

He's almost 10 months.

Rachel Cruze (107:26)

10 months right in the middle of this journey.

Caller (107:29)

10 months?

Guest/Debt Free Screamer (107:30)

The majority of it, yep.

Dave Ramsey (107:31)

What kind of debt was the 130,000?

Guest/Debt Free Screamer (107:33)

Most of it was student loans. We also had a HELOC personal loan and a little bit of everything else sprinkled in there. We were very normal.

Dave Ramsey (107:40)

Ah. How long y' all been married?

Guest/Debt Free Screamer (107:42)

Almost.

Caller (107:42)

Almost five years.

Dave Ramsey (107:43)

Yeah. Okay, so just long enough to get in a big mess. Okay, so what happened 20 months ago? What was the wake up call, the inspiration? The. What was it that's jogged you into this?

Guest/Debt Free Screamer (107:56)

This started out like every success story. I was doom scrolling on Instagram and I saw about a 10 second clip of your show and it was very drama filled and I had to know the ending. So the next morning I looked up the episode and what started out as just curiosity ended up eight hours of your show.

Dave Ramsey (108:14)

Oh, my gosh.

Guest/Debt Free Screamer (108:15)

Yes. Eight hours straight. Big yes. And I had never heard anybody talk about money the way that you guys do. And I was amazed. And whenever he came home from work, I was like, have you ever heard of Dave Ramsey?

Caller (108:27)

And he said, yeah, I had heard of you before this, but didn't really understand your principles or didn't really implement any of them.

Dave Ramsey (108:37)

All right, I'm unbelievably curious. What was the show? What was the drama that hooked you?

Guest/Debt Free Screamer (108:42)

It was a woman who had called in and she was in a very bad situation with her partner. There were kids involved. There was. It sounded like financial abuse and potentially some other abuse. And you were walking through it with her until you realized you're in danger now.

Rachel Cruze (108:57)

Oh, yes.

Guest/Debt Free Screamer (108:57)

And then I remember that call.

Dave Ramsey (108:58)

Yes, it was me and Rachel.

Guest/Debt Free Screamer (109:00)

Yep.

Dave Ramsey (109:00)

Yes, I do.

Guest/Debt Free Screamer (109:01)

Then it like cut off and I was like, I have to know what happened.

Rachel Cruze (109:04)

Give me the. Give me the rest of the story. Yes. Oh, my gosh, that's crazy. And then you went watch. Yeah. Eight episodes. Yeah. And then poor Brad comes in the door and you're like.

Guest/Debt Free Screamer (109:14)

And I bombarded him.

Rachel Cruze (109:15)

Yeah, I bet you did.

Dave Ramsey (109:16)

Well, your eyes are red. You've been watching eight hours of YouTube.

Rachel Cruze (109:20)

She's like, Listen, listen.

Guest/Debt Free Screamer (109:21)

I literally was like, we're going to pay off all the debt. We're going to go do a debt free scream, and I'm going to get a debt free shirt.

Rachel Cruze (109:27)

Okay.

Dave Ramsey (109:27)

And he's like, I'm not going back to work again.

Rachel Cruze (109:31)

Brad, what did you think when she kind of had this whole new plan of how does it do money?

Caller (109:35)

Well, that's very much like Amanda to do that. And I was like, okay. You know, and I'm one that, like, I react slowly. So I was like, thinking about it, it's like, well, we could definitely do that, you know?

Rachel Cruze (109:48)

Yes. Yes. Okay. So what was the first step you guys did as a couple? Did you sit down and do a budget? Did you map out your debt? Like, what was the first step? Because there's going to be some people maybe watching this clip, you know, on. On social media and see it. But what would you tell them?

Caller (110:02)

I think it really started with just like adding all of the debt together. And it's like, oh, yeah.

Guest/Debt Free Screamer (110:07)

We didn't realize it.

Rachel Cruze (110:08)

Yes.

Guest/Debt Free Screamer (110:08)

It was just sitting there the whole time. And I was like, oh, it's bad.

Dave Ramsey (110:13)

It's 130,000. Lots of little stuff.

Guest/Debt Free Screamer (110:16)

Yep. Just added up and it was a, you know, light bulb movement.

Dave Ramsey (110:21)

It's an old crap moment. Yeah. We really do have to do this now. Oh, my gosh. Yeah. Yeah. And so then what happened?

Caller (110:29)

Well, we knew that we wanted to start a family, and this was like a large step in just getting secure before having a child and definitely after getting it paid off. You are a lot more comfortable and flexible.

Guest/Debt Free Screamer (110:46)

And whenever I got pregnant, it was like, we got to go full send. So I was working six or seven days a week as a nurse on the floor, working two jobs up until four days before I had my baby.

Dave Ramsey (110:58)

Whoa.

Guest/Debt Free Screamer (110:58)

I got cleared by my ob. I wasn't doing anything dangerous.

Rachel Cruze (111:02)

But you were. Yeah, but workhorse. I'm like, you're like, we're gonna do this. We're gonna do this.

Guest/Debt Free Screamer (111:05)

My co workers thought I was crazy.

Rachel Cruze (111:07)

Yes.

Dave Ramsey (111:07)

Yes.

Guest/Debt Free Screamer (111:07)

I got a lot of bad feedback. Good feedback. Feedback.

Rachel Cruze (111:11)

But now after having a baby, you realize, oh, yeah. All day before the baby, like, we have the time. We can do this. Because life just changes completely right. When you enter in a new little family member. Okay, so for the 20 months, what would you say was the hardest part of that journey for you guys?

Guest/Debt Free Screamer (111:29)

For me was not seeing each other.

Caller (111:30)

I was gonna say time away from each other.

Rachel Cruze (111:32)

Okay.

Guest/Debt Free Screamer (111:32)

Yeah.

Rachel Cruze (111:33)

Yes.

Dave Ramsey (111:33)

All the work.

Guest/Debt Free Screamer (111:34)

We were passing ships in the night.

Dave Ramsey (111:35)

Cause I was doing hours upon hours upon hours. Upon hours, yeah. And of the 20 months, nine of it, you were pregnant.

Guest/Debt Free Screamer (111:42)

Yes.

Dave Ramsey (111:43)

Wow.

Rachel Cruze (111:43)

Yeah. That is so hard. Okay, so now from the marriage perspective, because relationally, you know, you don't see each other. I'm like, that is. That's a sacrifice for sure. Sure. Would you say your marriage is stronger today because of it and because of you guys going through this journey together than it was even, you know, two years ago?

Caller (112:01)

Definitely because of, like the communication that's involved in it. And we were very transparent with finances before it, but this definitely just reinforced all of it.

Rachel Cruze (112:10)

Yeah.

Dave Ramsey (112:11)

Wow.

Guest/Debt Free Screamer (112:11)

We know we can really lean on each other.

Dave Ramsey (112:13)

So this idea that because we get the call, you hear it if you listen and that, you know, I don't want the work life balance and I don't want my spouse to feel abandoned. And y' all didn't. You just went, you just went to work all the time and you said, we're going to communicate and communicate and communicate and work all the time and we're going to get out so that we can live like no one else. So that later we can live. And it didn't kill you. As a matter of fact, it made you stronger.

Caller (112:34)

Absolutely.

Guest/Debt Free Screamer (112:35)

We chose to be comfortable over being convenient so that we feel very comfortable now. But we had to put convenience in the.

Rachel Cruze (112:43)

Oh, that's good. Yes. During that process.

Dave Ramsey (112:46)

Good phrase. That's a good phrase.

Rachel Cruze (112:47)

Did anyone make fun of you? Do people think y' all were crazy?

Caller (112:50)

Absolutely, yes.

Caller (112:51)

I got so many bad.

Guest/Debt Free Screamer (112:53)

So much bad feedback at work.

Rachel Cruze (112:55)

So funny. Because you were working so much. Was that the bad feedback or was it the paying off debt.

Dave Ramsey (113:01)

Working so much while she's pregnant?

Guest/Debt Free Screamer (113:03)

And also we had an eight passenger Subaru that was paid off at that time and we sold it and we got a 20 year old van and on the back of it it says, dave Ramsey makes me drive this.

Dave Ramsey (113:15)

Oh, great. Thank you. Now it's my fault.

Guest/Debt Free Screamer (113:19)

And so people were like, what are you doing? Like, you're, you're crazy. Why are you doing this? You're pregnant.

Dave Ramsey (113:23)

You joined a cult.

Guest/Debt Free Screamer (113:24)

Yes. And I was like, yes, we did.

Rachel Cruze (113:27)

Yes.

Guest/Debt Free Screamer (113:27)

We got Xander, we got every dollar. We just went full send.

Rachel Cruze (113:31)

You're all in it. All in it. Yes.

Dave Ramsey (113:34)

Oh, my gosh, you guys, now that you're free, was it worth it?

Guest/Debt Free Screamer (113:37)

100?

Caller (113:37)

Definitely.

Dave Ramsey (113:38)

I'm proud of y'.

Caller (113:39)

All.

Dave Ramsey (113:40)

Very proud.

Rachel Cruze (113:40)

Now you get to stay home. Yes.

Guest/Debt Free Screamer (113:41)

It's wonderful.

Rachel Cruze (113:42)

Yes. And you get to like make these decisions without the stress of feeling like we have bills to pay.

Dave Ramsey (113:46)

Oh, and all those people who thought they had a vote are still at work. Oh, look at that.

Guest/Debt Free Screamer (113:52)

I was just telling him, I said, it's so weird because we don't really get any mail anymore. Like, bills don't come in the mail. It's just the newspaper.

Dave Ramsey (113:59)

I was like, when I first started this stuff 35 years ago, I met a guy, he said, I want more mutual fund statements in my mailbox than bills.

Guest/Debt Free Screamer (114:07)

100%.

Dave Ramsey (114:08)

That's a good trade. I like that. Very cool. Good for you guys. So proud. All right, what do you tell people? The key to getting out of debt.

Caller (114:16)

Is adding friction to financial transactions. So making it less convenient to spend the money. And I really like the home cooked meals.

Dave Ramsey (114:26)

Yeah. Give me an example of the friction you did that made it hard to spend money.

Caller (114:31)

Well, like, obviously the credit card makes it too easy to spend money. Removing Amazon prime and not shopping on Amazon as much as you can because it's too easy to click that button and it's sent to your door.

Guest/Debt Free Screamer (114:46)

It's amazing how much we stopped spending whenever we got rid of credit cards. I know you guys talk about it, but I don't think people realize how impactful that is.

Dave Ramsey (114:54)

It's the truth. Wow. Yeah. Who knew?

Rachel Cruze (114:56)

Because you feel it with your money, you're thinking twice about it. Yes.

Guest/Debt Free Screamer (115:00)

And I would add to that that you have to believe that it's possible. I didn't believe it was possible until I started watching your show and I was like, we could do this.

Rachel Cruze (115:07)

Yes. Oh, you guys are amazing. Congratulations.

Dave Ramsey (115:10)

You're a power couple, man. I'm so proud of y'.

Caller (115:12)

All.

Dave Ramsey (115:13)

You killed it. You're doing so well. You're going to be in such a great place in another couple of years. And you've completely changed your family tree for your baby. I'm proud, proud of you. Very, very, very well done. Brad and Amanda from Harrisburg, Pennsylvania. $130,000 paid off in 20 months making 170. Now she's home making 120. Count it down. Let's hear a debt free scream. Three, two, one. We're debt free. Wow. Well done. Well done, well done. Have to let the social media team know that they changed the couple's life with that clip that they dropped for doom scrolling.

Caller (115:58)

Wow.

Dave Ramsey (116:36)

Scripture of the day is James 1. Blessed is the one who perseveres under trial because having stood the test, that person will receive the crown of life that the Lord has promised to those who love him. Newt Gingrich said, perseverance is the hard work. You do after you get tired of doing the hard work you already did, that's good. Hey, big news. The Fed just cut rates. We all heard about it last week. And 15 year fixed rate mortgages have dropped to the lowest we've seen in 11 months. Currently 15s are sitting at 5.71. If you're financially ready, now is a great time to buy a house or put one up for sale. Lower rates could save you thousands. It could be moving the people loose, that turning them loose, getting them off the bench so they come by your house. So buying an affordable home you love is possible when you work with a Ramsey trusted real estate agent. These are pros that we hand pick because they're high octane, high protein. If you're going to list a house for sale, you're going to buy a house. You need to do it with somebody who actually sells houses, houses, not your Aunt Sally who just got her license. I know she makes good apple pie, but she's not a good real estate agent. She just got her license. Don't use Aunt Sally. It's your million dollar house that's dumb. Find a trusted local pro for free@ramseysolutions.com agents or click the link in the show notes if you're listening on podcast or YouTube. Trevor's in Florida. Hey Trevor, what's up?

Caller (118:03)

How you guys doing today?

Dave Ramsey (118:05)

Great, man. How can we help.

Caller (118:08)

Me? I'm nervous. I'm ashamed, disgusted, embarrassed at all. I'm going to go straight to the question because I really need guidance on this. Should I file for bankruptcy? I made dumb mistakes and now I regret it. I'm ashamed. So just real quick backstory story. So I purchased the house and when I purchased a house I kind of paid more than what I should have then fast forward. I basically ended up losing my job in the mix of it. I bought when the interest rates and and the prices were going up and I already had paid over what their house was supposed to be. So when I went to sell it, I basically couldn't sell it because there was a lot of brand new properties going up and the sellers were giving a lot of more incentives. So my house beautiful house was up for sale but nobody was really interested because I wasn't offering anything on no incentives. I couldn't compete with the other sons. And then I ended up my realtor kind of convinced me to like do a sub 2 contract meaning I keep full financial obligation of the payment while I basically have somebody make the payment for me. And once the house is paid they take basically the house is theirs. Fast forward a year. Well, not even a year. The person that took over the payment has not been making the payment. So I just got served on August 22 that the House is going up before foreclosure. So I reached out to the gentleman. I've been trying to reach out to the gentleman because I kind of knew that he was running pain, but I was unable to. So I drove, drove there last week and kind of spoke to him and he has no intentions of leaving the property. And I'm, I mean, he has no intent of what?

Dave Ramsey (120:22)

Say that again.

Caller (120:23)

Of leaving the property or kind of signing it back over to me to socket the deed.

Rachel Cruze (120:28)

So he's living there.

Dave Ramsey (120:30)

So he, he's running a scam. Yeah. Okay.

Caller (120:33)

Yeah. So basically right now I, I have no means to like get another lawyer because I'm going through a custody battle because the battle with child support battle because mother of my kids move about three hours away.

Dave Ramsey (120:47)

So what do you make a year, Trevor?

Caller (120:51)

So myself I make 40 and my wife works 40. So combined we make about 80.

Dave Ramsey (120:57)

Okay, right. You can afford a lawyer and you need a lawyer.

Caller (121:02)

That is correct, yeah.

Dave Ramsey (121:04)

Because if you file bankruptcy, it's a lawyer and you have to pay a lawyer, so you might as well pay one to evict this scam. Art.

Caller (121:12)

Yeah, so. And that's what I was thinking of. But again, like, my budget right now is super, super tight. Like I'm thinking about $800 for the other lawyer to get this case resolved.

Dave Ramsey (121:28)

Because like I said, you don't have the money to file bankruptcy if you don't have the money to hire a lawyer to throw the guy out.

Caller (121:36)

Well, I have, I have a PC that I have right now and I can probably get like fifteen hundred dollars for it.

Dave Ramsey (121:45)

You have a what?

Caller (121:46)

PC. It's a gaming computer.

Dave Ramsey (121:49)

Yeah, okay, so sell it and hire a lawyer to evict the guy.

Caller (121:53)

You don't think it's going to take too long though?

Dave Ramsey (121:55)

It might. I mean, it might, but we don't file bankruptcy until we've tried everything else. I'm not going to roll over in Florida. It's going to take them forever to foreclose. How far behind are you on the house? Because the guy's not bill. What?

Caller (122:11)

January. So about $40,000.

Dave Ramsey (122:14)

How many months?

Caller (122:16)

That's February, March, April, May.

Dave Ramsey (122:20)

Yeah. So when they sent you a notice, they didn't give you a date. They just said the house is in default and we're going to foreclose if you don't straighten this up.

Caller (122:28)

No, no, no, no, no, no. I already got served. The 20 days for me to respond to the court has passed by. However I looked, I logged in today to see like the case disposition because he received his. The person that's living in the house right now received. He got also served and he basically had 20 days also to respond. But now I guess he was able to hire a lawyer and basically put like, oh, they didn't, they didn't serve all the tenants that are living there correctly. So I guess he's.

Dave Ramsey (123:01)

This guy's really good at scamming. Yeah.

Caller (123:03)

Yeah. So. Okay.

Dave Ramsey (123:05)

But there's not a foreclosure date has not been set.

Caller (123:09)

Not yet.

Dave Ramsey (123:10)

Yeah, it should, it shouldn't be in Florida after seven months. It'd be unusual. It was. Okay, so.

Caller (123:14)

And it's a little bit more backstory to it. So I, right now we, this all happened. We moved to Puerto Rico and then we just came back. So right now we're living with in laws and we're trying to get an apartment.

Dave Ramsey (123:27)

What were you doing in Puerto Rico?

Caller (123:28)

Rico just basically started a new job. Kind of didn't work out because my 9 year old's education started like drawing back and we noticed it and we just told my wife and I was like, me, this.

Dave Ramsey (123:42)

All right, Trevor, okay, here's the thing. You're not bankrupt until you're bankrupt. You are projecting into the future that this is going to go one certain way and we don't know what it's going to do yet. Yet. It doesn't sound good. There's no question you've been scammed, but it's not costing you a dime today. You're not having to write checks today unless you want to. Unless you want to catch this thing up. Okay.

Caller (124:09)

Yeah. So. No, but again, since we moved back and we're still, we're, we're living with my in laws. Like, I really want to move out, but I'm unable to. I got six kids.

Dave Ramsey (124:21)

So we're all got anything to do with bankruptcy.

Caller (124:25)

I understand that, but bankruptcy doesn't get.

Dave Ramsey (124:27)

You a place to live for six kids.

Caller (124:30)

No, I understand that, but it's just the fact that like, it's, it's already hitting my credit and like, even if I was to find the money, you.

Dave Ramsey (124:39)

Don'T think bankruptcy dings your credit?

Caller (124:42)

No, it does.

Dave Ramsey (124:43)

Okay? You're gonna drop an atom bomb on your credit, dude, it's gonna be, it's gonna be a wasteland for seven years. Years. For 10 years. If you follow chapter seven and you're not bankrupt because nothing has happened yet to bankrupt you. You're just have done a series of bad deals and you keep jumping from one thing to another. You jumped into the house, you jumped out of the house. You jumped into Puerto Rico, you jumped back. Jump, jump, jump, jump, jump, jump. You need to find something really steady and put your hand to the plow and stay on it. And I do recommend you keep arguing with me. But you called. Now ask me what to do. And I recommend you get a lawyer and you throw this guy in the street. And then you start negotiating with a mortgage company on a short sale with a good real estate agent. With a good real estate agent that knows what they're doing. The other real estate agent that you had was an ignoramus at best, a con artist at worst. No one should have recommended you do that deal as malpractice. The law might not call it that. I'm morally calling it malpractice. It was horrible advice to put you into that deal. Those deals always end up this way. They never end up any other way. Because who else moves into a house and pays full price for it plus and pays payments for 30 years and it's not even in their name? People who are going to scam you. That's who. So that's what I would do if I were in Issues Hunt. 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.