What if You Could Build a Life That Didn’t Exhaust You?

Summary

Podcast Summary: The Ramsey Show – "What if You Could Build a Life That Didn’t Exhaust You?"
Release Date: November 22, 2024

In this enlightening episode of The Ramsey Show, host John Deloney and co-host Rachel Cruz, along with their expert team, delve into listeners' financial and personal challenges, offering actionable advice to build a balanced and fulfilling life without the constant strain of financial stress. The episode emphasizes prioritizing debt repayment, strategic investing, and maintaining mental and emotional well-being to achieve long-term financial freedom and personal satisfaction.

---

1. Prioritizing Debt Repayment Over Early Homeownership

Caller: Brett from Sheridan, Wyoming (00:46-05:45)
Situation:
Brett, a 24-year-old project manager, reached out with $1,300 extra each month after expenses. He faces $30,000 in student loans and dreams of homeownership.

Discussion & Advice:
Rachel Cruz advises Brett to prioritize eliminating debt before investing for a home. She emphasizes that the $1,300 should be directed towards debt repayment to achieve financial freedom quicker:

Rachel Cruz [01:29]: "You should be investing in your freedom, and that means getting out of debt as fast as possible."

Key Takeaway:
Focus on paying off high-interest debts first to free up future income for investments and larger financial goals.

---

2. Managing Multiple Debts and Balancing Family Responsibilities

Caller: Justin from Seattle, Washington (06:09-29:15)
Situation:
Justin, a 23-year-old newly married father, discusses managing a $340,000 mortgage, $25,000 in car loans, and the challenges of supporting a newborn with limited income.

Discussion & Advice:
John Deloney and Rachel Cruz provide Justin with strategies to increase income and reduce expenses. They stress the importance of his wife's involvement in generating additional income and suggest downsizing or renegotiating debts:

John Deloney [03:49]: "Work three jobs, work four jobs. Be give yourself a bananas challenge."

Key Takeaway:
Enhancing household income through additional jobs or side hustles can accelerate debt repayment and stabilize financial situations.

---

3. Navigating Financial Advice from Extended Family

Caller: James from Stamford, Connecticut (32:07-37:31)
Situation:
James is grappling with his mother-in-law's outdated financial and career advice, which conflicts with his and his wife's modern financial needs.

Discussion & Advice:
Rachel Cruz and John Deloney highlight the necessity of James and his wife aligning their financial goals independently of external opinions. They encourage open communication and joint decision-making:

Rachel Cruz [35:51]: "Let's just take mother in law out of the equation. Let's just talk directly with your wife."

Key Takeaway:
Couples should prioritize their financial plans and mutual goals over external advice to maintain harmony and achieve their objectives.

---

4. Addressing Large-Scale Business and Personal Debts

Caller: Allison from British Columbia, Canada (41:11-49:12)
Situation:
Allison and her husband face a combined debt of $3.2 million, primarily from their medical practice, alongside personal debts including student loans and a mortgage.

Discussion & Advice:
Rachel Cruz advises tackling personal debts first before addressing business liabilities. She underscores the importance of increasing business income and possibly restructuring loans:

Rachel Cruz [44:35]: "You have to drastically get your income up and decrease expenses, both in the business and in your personal life."

Key Takeaway:
Prioritizing personal debt repayment and boosting business revenue are crucial steps toward achieving comprehensive financial stability.

---

5. Ethical Considerations of Credit Card Rewards

Caller: Meg from Maine (63:27-72:06)
Situation:
Meg, a 20-year Ramsey Show follower, expresses concerns about the ethical implications of credit card rewards and their impact on financially vulnerable populations.

Discussion & Advice:
Rachel Cruz and John Deloney engage in a philosophical debate, highlighting how rewards programs can inadvertently harm those struggling financially. They argue against participating in such systems to maintain ethical integrity:

Rachel Cruz [66:33]: "Families with household incomes below 40 grand are less likely to even qualify for these rewards, but they're more likely to pay late fees and additional interest."

Key Takeaway:
Avoiding credit card rewards can contribute to a more ethical financial lifestyle, reducing participation in systems that may exploit economically disadvantaged individuals.

---

6. Optimizing Savings: High Yield Savings vs. Money Market Accounts

Caller: Michael from Cincinnati, Ohio (53:26-82:58)
Situation:
Michael seeks advice on whether to place his $1,000 emergency fund in a high-yield savings account or a money market account for better returns.

Discussion & Advice:
Rachel Cruz recommends high-yield savings accounts due to their higher interest rates and liquidity, making them ideal for emergency funds:

Rachel Cruz [53:26]: "They have less overhead because they're online. They don't have to cover as many bills and hire as many people so they can pass on their savings to you in the form of a higher interest rate."

Key Takeaway:
High-yield savings accounts are generally more beneficial for emergency funds compared to money market accounts, offering better returns and easier access.

---

7. Accelerating Mortgage Repayment While Balancing Investments

Caller: Eric from Nashville, Tennessee (75:04-82:58)
Situation:
Eric, a 34-year-old, asks whether to aggressively pay off a $300,000 mortgage or to split extra funds between mortgage payments and investments.

Discussion & Advice:
Rachel Cruz advises prioritizing mortgage repayment while ensuring regular contributions to retirement accounts. She suggests that eliminating the mortgage early provides greater financial freedom:

Rachel Cruz [77:00]: "Anything beyond that, throw at the mortgage and let's be done with it."

Key Takeaway:
Balancing debt repayment with investments ensures both immediate debt relief and long-term financial growth, fostering overall financial health.

---

Conclusion: Building a Balanced and Non-Exhausting Life

Throughout the episode, John Deloney and Rachel Cruz emphasize the importance of simplifying financial strategies, prioritizing debt repayment, and fostering open communication within families. They advocate for making deliberate financial choices that align with personal values and long-term goals, ultimately leading to a life that is financially secure and emotionally fulfilling.

Notable Quotes:

• Rachel Cruz [01:29]: "You should be investing in your freedom, and that means getting out of debt as fast as possible."

• John Deloney [03:49]: "Work three jobs, work four jobs. Be give yourself a bananas challenge."

• Rachel Cruz [35:51]: "Let's just take mother in law out of the equation. Let's just talk directly with your wife."

• Rachel Cruz [66:33]: "Families with household incomes below 40 grand are less likely to even qualify for these rewards, but they're more likely to pay late fees and additional interest."

• Rachel Cruz [53:26]: "They have less overhead because they're online. They don't have to cover as many bills and hire as many people so they can pass on their savings to you in the form of a higher interest rate."

• Rachel Cruz [77:00]: "Anything beyond that, throw at the mortgage and let's be done with it."

This episode underscores the Ramsey Show's commitment to guiding listeners through practical financial decisions, ensuring that their pursuit of wealth does not come at the expense of their well-being and peace of mind.

Transcript

[John Deloney]

Live from the headquarters of Ramsey Solutions, it's the Ramsey show, where we help people with their money, with their mental and emotional health, with their work, with their marriages, with their lives. I'm John Deloney, joined by my great friend, George Camel. We are taking your calls live at 888-5225, AAA 825-5225 on this incredible, this beautiful, cold Nashville day. Let's go out to Sheridan, Wyoming, and talk to Brett. What's up, Brett?

[George Camel]

Hey, how am I coming through?

[John Deloney]

Yeah, you are coming through loud and clear, brother. What's up?

[George Camel]

Awesome. So I'm 24. I just took a new job. And so after expenses and rents and all that good stuff, I have about $1,300 each month left to play with, give or take. I currently have 30,000 in student loans, but I do have $1,000 already saved up. And I'm hoping in the near future that I can buy a house here. And I was just curious as to, like, what money markets or mutual funds that you guys would. Excuse me, sorry. I'm curious as to what kind of ways I should invest my money in to make this dream a reality, to be debt free and to hopefully be a homeowner here soon.

[Rachel Cruz]

Love it. Well, I'll tell you this right now. You should be investing in your freedom, and that means getting out of debt as fast as possible, which then means the home dream needs to take a back seat for now. So that 1,300 bucks extra, I don't think it's play money. I think it's get out of debt money. And we'll get to investing soon enough. Because you got 30k in debt. What do you make?

[George Camel]

I make about. About 47.48 a year.

[Rachel Cruz]

Okay, cool. So basic napkin math says you got 30 grand in debt. You're adding 1,300 bucks on top of your minimum debt payment.

[George Camel]

So that 1,300 is just what I have left over after all of my.

[Rachel Cruz]

So you still gotta make your student loan payment in that?

[George Camel]

Yeah, no, my student loan payment is already made. That 1,300 is like once every bit of, like, my rent, wifi, groceries, gas, all that is paid for.

[Rachel Cruz]

Okay. So you're going to be out of debt at this rate in about a year and a half.

[George Camel]

Okay, I like that.

[Rachel Cruz]

And so, I mean, that's just. You do 1,300, if you can do 1500, we'll clean it up faster. So that would be my challenge to you is how much faster can we get rid of this debt to get the fully funded emergency fund to then begin saving up the down payment. And if I'm in your shoes, if that down payment is going to be know, let's say you're going to save up for two years. I wouldn't put it in the market, there's too much risk there. I would put it in a high yield savings account.

[George Camel]

Okay.

[John Deloney]

How old are you Brett?

[George Camel]

I'm 24 years old.

[John Deloney]

What's your, what's your work that you do?

[George Camel]

I'm like a lower level project manager.

[John Deloney]

Okay. I'm telling you this, 20 years older than you. Okay. I'm trying to think of something cool that happened to me when I was 24. I got married when I was 24 so that was pretty cool. But before that I can't remember. I can't even remember a dinner I went to. I'm sure I did. Or a concert I saw, I'm sure I did. I don't remember it. If you will do something for your 25 year old self. If you would go get a weekend job or if you would leave your job and be exhausted and go throw boxes at Walmart from 6pm until midnight and you did that for six months. You will owe nobody any money at the age of 24 or 25.

[George Camel]

Yeah, see that's. I was considering getting another job. I've been looking around town for part time work. Either something like early morning like I know like some of the local gyms here are looking for some morning work or at night too. So there's some, there's options here that I was considering.

[John Deloney]

Dude, if you will do that 25 year old you will be free forever. Forever. And I tell 20 year olds all the time work like crazy in your 20s. The work you put in in your 20s pays dividends in your 40s.

[Rachel Cruz]

You have precious resources that age which is time and energy.

[John Deloney]

Yes, and a strange like superhuman way to rehabilitate yourself. I don't understand how 20 year olds knees don't hurt like mine do, but they just don't. It's awesome.

[George Camel]

I mean minor mine can get pretty sore sometimes too. I guess from.

[John Deloney]

All right, well wait till you're 40 bro. You thought you think they do wait, but anyway dude, yes. Work three jobs, work four jobs. Be give yourself a bananas challenge like George just laid the math out. You can be debt free in 12 months just right now with nothing changing. Do the math and see what it would take to be done in six months. Challenge yourself. You're 24 years old and everyone, like, you'll know you're doing it right when everyone around you is like, you're crazy. You need to rest, honey. I'm worried about you. Yes, perfect. But then when you hit that 25, exhale, relax. Like, it'd be. It'd be amazing. And here's what I promise you is going to happen. You're going to find some synergy at your work, too. People are going to ask you, like, man, you're like, getting stuff done. Hey, I want you to come help me on this project. Like, it just has a leveling effect that levels up every part of your life in a really strange, bizarre way. But it's pretty cool. Are you in?

[George Camel]

Am I it?

[Rachel Cruz]

Oh, yes.

[George Camel]

Absolutely, I'm in.

[John Deloney]

I love talking to 24, 25 year olds who are like, dude, I'm ready to burn the ships. Let's go do it. So good for you, brother. That's awesome.

[George Camel]

I'm ready to. I'm ready to get rid of this stuff because they said, I want to live the American dream best I can.

[John Deloney]

Excellent.

[Rachel Cruz]

And at Brett's age, I didn't make as much and I had more debt and I did in 18 months. So that tells me Brett's going to do it even faster and he's going to be going places. Because I was still a knucklehead at.

[John Deloney]

That age, I thought the American dream when I was 24 was a bigger truck. I had no idea. Like, so you, brother, Good on you. All right, let's go to Justin in Seattle, home of Allison Chains. What's up, Justin?

[Rachel Cruz]

Are you with us, John?

[George Camel]

Hey, you just broke up a bit.

[John Deloney]

Oh, what's up, brother? I'm here.

[Rachel Cruz]

I think you're breaking up. We got crystal clear signal, man.

[John Deloney]

What's up?

[George Camel]

All right, I'm 23 years old. My wife is also 22. And we're over here, and we got a mortgage that we just bought on the house. Like, you know, 340,000 in February. We should have, you know, not have bought this house, but we are now in it. And now we have also car loans. So I'm calling out of getting a second opinion on some debts.

[John Deloney]

Like, how much money do you make, Justin? How much money do you make right now?

[George Camel]

$60,000.

[John Deloney]

You have car loans, a $340,000 house note, and how much other debt do you have?

[George Camel]

So 25,000 in car loans, about $3,500. Of that, $25,000 could be refunded in a warranty on the card that we just bought.

[Rachel Cruz]

Good. Gets us down to 22. Okay, what else? What other debt?

[George Camel]

So that's all the debt. That's, that's all of our debt is our house and the $25,000 in cars.

[Rachel Cruz]

And is your wife working outside the home?

[George Camel]

No, not currently. She's trying to do some babysitting on the side because we just had a baby son back in.

[Rachel Cruz]

Congrats.

[George Camel]

Thank you.

[Rachel Cruz]

But it's not fun because you're stressed and broke.

[John Deloney]

Not fun. Diapers are a thousand dollars. They didn't tell you that, did they, Justin? What's that diapers cost? $1,000 apiece. They're made of gold, I think.

[George Camel]

No, they didn't. Costco runs definitely help though.

[Rachel Cruz]

Hey, so how can we help today?

[John Deloney]

So we're right up against the clock, Justin. So get right to your question, brother.

[George Camel]

I have about 30 $500 in a Roth IRA that I can take out in contributions and put towards this debt. I also have bonuses that I get each year, about $6,000.

[Rachel Cruz]

I would use the bonuses toward the debt. I wouldn't touch the Roth ira. And I would consider selling the car if you guys are really up against this and that mortgage is more than like 40, 50% of your take home pay. This is an on fire situation. You got to get your income up, you got to sell the car and downgrade. And long term you might decide we can't stay in this house.

[John Deloney]

And she's probably going to have to get a job and so not just fiddle around the edges with babysitting, but she's going to have to open a babysitting shop in her house because y'all need income. This is the Ramsey Show. We'll be right back.

[Dave Ramsey]

Hey guys, it's Rachel Cruz. Just about everything costs more these days and healthc care is no exception. So if you're looking at your healthcare options during open enrollment, be sure to check out Christian Healthcare Ministries. CHM is not health insurance. It's a biblically based health cost sharing ministry that's helped hundreds of thousands of families just like yours with health care costs. CHM is affordable, aligns with your values and gives you more options for your health care. And you can join at any time, including open enrollment. Find out more and join [e-mail] budget. That's chministries.org budget.

[John Deloney]

Welcome back to the Ramsey Show. I'm John Deloney, joined by George Camel. 888-825-5225. We're taking your calls live. Our early Black Friday sale is here. Whether you're shopping for yourself or looking for that perfect gift to help someone get their money in order. Now's the time to shop and get hard cover books for 12 bucks. Or audio books if you can't read like George for only eight bucks. A couple of books on sale Money's Not a Math Problem is on sale right now. It's a great gift for anyone wanting to pass the to get past the we ain't got no money mentality. Total Money Makeover is on sale. You may have heard of that. If you haven't heard on that book. Welcome to Earth. It's good to see you. Total Money makeover. You should probably get it. It's a great gift to give to anyone. Go to Ramsaysolutions.com store to check out all of the Christmas deals. Or if you're listening on the Tubes or on podcast, you can click the link in the description. Let's go out to the 806 to Amarillo, Texas and talk to Sam. What's up Sam?

[Justin]

Hey, how you guys doing?

[John Deloney]

We're rocking onto the Break it down, brother. What are you up to?

[Justin]

Oh man, let me tell you, last few years of my life has been, some people would call it easy street. And I, I would have agreed with you if you told me 10 years ago, but now I'm struggling to find purpose. I'm struggling with being fulfilled.

[John Deloney]

What does easy street mean?

[Justin]

Well, I, I was in the military, I did eight years in the US Navy and I came home, got a four year degree and I made the decision. I was like, okay, if I meet the, if I meet my eventual wife while I'm in college, then I'll settle down, I'll start a family. If I don't, I'll go back into service as an officer. And you wouldn't say, have it. The Lord blessed me and I found my wife and we've been married now for six years. She is a family medicine physician and board certified surgical obstetrician. So she makes all the money and we have three beautiful babies. I love my babies. I love them so much. But the Bible makes it very clear it is not good for man not to work. And I just, I feel like the pressure is on. Even though I don't need it for financial purposes. I just feel like I'm not doing anything of value, which I know is a lie. You know, raising my kids is the greatest value that I can have as a human being. But because they're going to leave the most lasting impact, you know, money is only going to go so far, but my kids can make a lasting impact on their communities. But I just don't see the return on investment right now. And that's where I'm struggling.

[John Deloney]

See, man, if you, if you were here, if you and I were just sitting, if we met up in Lubbock and we were just sitting down in the shadow of the stadium having a drink, I would get up right now and I'd walk around the table and I'd give you a hug. Here's why. For some reason you believe that your value is economic. Like, that's it. And for some reason you have backed yourself into this corner of either or. And none of us make good choices when it's either I gotta stay home with the kids or I've got to leave everything and go do like. You have backed yourself into an either or and you're going crazy. So take all, clear the, clear the deck, clear the whole table. You can snap your fingers. You got a four year degree, you got a, you got, you got someone that you says a great wife who's also super talented and her talent actually makes a whole bunch of money. My wife was incredibly talented, but she was a school teacher. Right. So very different. But your super talented wife makes a jillion bucks. Forget all of that. What do you want to do?

[Justin]

Well, I say that's, that's, that's the part of this equation that makes me feel kind of overwhelmed. You know, I, I'm, I'm an ex, I'm an experienced writer, obviously. My four year degree was in network engineering.

[John Deloney]

Hold on. Sam, Sam. I don't care anybody that crap you're saying. What do you want to do?

[Rachel Cruz]

We're impressed by your LinkedIn, I promise.

[John Deloney]

Yeah, it looks like you want to.

[Rachel Cruz]

Do with your life.

[Justin]

I, what I want to do, honestly, is I want to, I want to get into it. I want to, I want to grab that bull by the horns and I want to take it. Want to take it for a ride.

[John Deloney]

What's your four year degree in?

[Justin]

Network administration?

[John Deloney]

Why are you not working in it?

[Justin]

I was, but then when my wife said go to Memphis, see.

[John Deloney]

Why aren't you working in it?

[Justin]

We didn't have child care until like three months ago and I've been trying to fill application after application and I'm just, I'm not getting emails or phone calls back and it's really starting to kill my drive.

[John Deloney]

Okay, so what you're finding out is you want to do a thing and the road you're trying to take isn't working. Cool. Can you find some folks at your local church there or over at WT and go sit there and have coffee with them and ask them about IT opportunities in Amarillo, Texas?

[Justin]

I could probably talk to someone for sure. I don't know who that someone would be, but I can start asking questions.

[John Deloney]

All you want to do is take some. Take someone to coffee.

[Rachel Cruz]

Do you know anyone that works in it? Even Facebook friends?

[Justin]

I gave it Facebook like 10 years ago.

[Rachel Cruz]

Okay, well, you need to find some people who are in that field, bro.

[John Deloney]

You got people, you got people you're in the service with that are out scattered across the country.

[Justin]

They are actually. And I tried getting help there and they tried to help me get jobs, but even. Even there, I came up short. But I have, admittedly, I have not dug in. I haven't dug as deeply locally as I probably could have, and I'm not even from here. That's part of my hesitation. I'm like, they're gonna be like, who's this guy? There's nobody. I don't know who he is.

[John Deloney]

No, they're not. That's. That's bullcrap. That's a story you're telling yourself. And again, it goes back to you. That's why I would have come around the table and hugged you, because you're big. The cancer here is not that you haven't found an IT job. The cancer here is you have lost purpose. You think when you checked out of the military and married an amazing woman, that there was a period at the end of your sentence, and that's wrong. It's not true. It's a lie. And so when you go looking for a job, you're going looking for a job with one foot. You're just sending out a bunch of LinkedIn profiles. And you're not. That's. That's not how people get jobs. And you also, I know you had eight years in the service. You somehow convinced an amazing physician to marry you. And by the way, you didn't convince her. You're probably a pretty amazing guy. You went and knocked out a four year degree route when you got home. You've got all of these qualifiers that tell me that you're a hardworking, good man. The only person in your world who doesn't believe that is you.

[Justin]

You're not the first person that's revealed that to me.

[John Deloney]

Okay, but here's the thing. You can't manifest that belief. You have to go. You have to stand on a series of concrete steps that can only be stood on if you Take action.

[Justin]

Okay, so what?

[John Deloney]

So this is you going to Sunday school this weekend and you asking for prayer requests in your Sunday school class and say, hey, I'm a military veteran. I've got. I really want to get into it work. I don't even know where to start. If anyone has anybody, I would really be grateful if I would love to take someone to coffee and learn about what's going on here in Amarillo, Texas, or if anyone has a connection down in the multiple small startups that go on in Lubbock, Texas, I want a connection there. And then I guarantee you somebody will call. We'll talk to you after class.

[Rachel Cruz]

Go ahead, George, and just do your homework and research and go. What are all the jobs that I really want? What are they saying must be true for me to get this job? Okay, let me make sure I have that so that when I do show up for the interview, it's not a dud. I know exactly what they're looking for. I've done my homework. I know the company, I know the mission. I know the skillset needed. And then on top of in person, go scour the subreddit threads for it and see what people are doing, how they got the job they're doing, do they enjoy what they're doing. You've got a lot of homework to do, and I think that will get you. Get the fuel going again, get the fire lit.

[John Deloney]

Do you have a. Do you have any men there in Emeril that you hang out with regularly?

[Justin]

No, that's. That's part of my problem. We. We moved here five years ago, and I never really kind of ingratiated myself in the social circles.

[John Deloney]

Okay, that starts today. The most common conversation I have with former veterans is you. More than anyone else on Planet Earth, veterans know more than anything what it's like to be in a relationship with somebody, stand shoulder, shoulder to shoulder with somebody who will die for you. And it's almost impossible then to come home, to unhook from that level of community and connection and come home and sit next to some Ned Flanders in a coffee shop who's like, you know, like, it's really hot. And you're like, dude, shut up. I know what real connected friendship looks like. And what. So veteran after veteran after veteran that I talked to does. They just circle up and they stay inside their house. And Netflix says, hey, I got the next show for you. Just stay there. And so your mission right now, brother, is to go find a group of men you can go do something with. Go Mule Deer Hunting, go hiking out in the canyons, go do some stuff with other guys and they're going to say no. You're going to ask again and they're going to say no and you're going to ask again. You're going to ask again. You're going to find a small little gang out there. Even if you can find some folks who used to be in the services and now they're retired out to West Texas. Great, man. But your mission is to go find a group of men. 1, 2, 5, 10. I don't care who will do life with you and I promise you there will be connections into it. Thanks for the call, my brother. We'll be right back.

[Sam]

One of the questions I get all the time is which life insurance company should I use for my term life policy? A valid question since there are hundreds of companies out there with rates all over the place and riders and add ons that are simply a waste of money. You need to get this done and make the right decision. That's why the only company I use and have recommended for over 25 years is Zander Insurance. Zander is a broker who shops the top term life companies for you and finds the best rates available from the only plans I recommend. They also save you time. Whether you want to work online over the phone or via text. Their team will cater to your needs and help you make the right decision. This is an absolute necessity and Zander has made the process easy and convenient. Call them at 800-356-4282 or visit xander.com for instant online quotes.

[John Deloney]

Welcome back to the Ramsey Show. I'm John Deloney, joined by George Camel. Let's go out to Panama City, Florida and talk to the great and powerful Jason. What's up, Jason?

[Jason]

Hey, how you doing?

[John Deloney]

We're just partying, brother. What's up, man?

[Jason]

So my question is that I have a little bit of money for my inheritance and I'm wondering if right now is the right time to invest or if I should wait a little bit for the economy to do its thing.

[John Deloney]

What does that mean?

[Rachel Cruz]

What does do its thing mean? It's been doing its low and it's.

[Jason]

It'S right now it's starting to pick up.

[Rachel Cruz]

So what economy do you live in, brother? We're at record highs every day.

[John Deloney]

Are you waiting for it to crash and then get in?

[Jason]

Well, you know, I don't know what's going to happen with the whole election and I sweep. It happened with it with this happening. But it, I'm worried that it I've already invested some money for my kids.

[Rachel Cruz]

Okay.

[Jason]

For my inheritance in the trust fund. So they're taking care of as far as them, but I'm concerned about my, me and my wife's retirement.

[John Deloney]

How much money did you get in an inheritance?

[Jason]

I got about $100,000.

[John Deloney]

Who passed away and I put about.

[Jason]

I took, I used 40,000 to pay off all my debt. That was the first thing I did. I paid off all my debt.

[Rachel Cruz]

Wonderful.

[John Deloney]

Good for you.

[Jason]

So, and then I had, of course, I took 20,000 for my kids and I put $10,000 into diversified portfolios with a stockbroker and then tied a trust to it so that that's their inheritance. When if something were to happen to me and my wife, specifically because I have a three year old son who's special needs.

[John Deloney]

Do you have life insurance?

[Jason]

So I wanted to make sure that he was taken care of.

[John Deloney]

Hey, Jason. Jason. Jason.

[Jason]

Yes?

[John Deloney]

Do you have life insurance?

[Jason]

I do.

[John Deloney]

How much?

[Jason]

I have life insurance on myself, my wife and both my kids.

[John Deloney]

Okay.

[Rachel Cruz]

Why do you need life insurance on your kids?

[Jason]

Just in case, I mean, something happens to them. I mean, it's never, it's never a bad idea that my mother had life insurance on me because both of my brothers passed away. One when he was 6 and 1 he was 25. And it hit my family hard financially, so my mother took life insurance out on me in case something were to happen to me.

[Michael]

That way the funeral could be paid for.

[Rachel Cruz]

You've had a lot. You've had a lot hit you in your lifetime. A lot of trauma.

[Jason]

I mean, I'm the last of my family, so my father, my mother, my mother died October 1st, and that's why I got my inheritance.

[John Deloney]

I'm sorry, brother, here's the deal.

[Rachel Cruz]

You've been making a lot of decisions out of fear. I can tell there's a lot of anxiousness about. But what if it's not enough? And what I need to take care of and I want you to just breathe, Exhale, homie, slow down. You're going to be okay. You are so far beyond what most people couldn't even spell, the word, trust. And you've got it set up for your kids already, so let me just give you some facts to slow down, let you breathe when it comes to the economy. Under President Trump's last presidency, the stock market was up 53%. Three and a half years into his presidency, it was up 53%. Under Joe Biden's presidency, three and a half years in, it was up 50%. So basic math says over seven year period, the stock market went up 103%. It doubled. Correct.

[Jason]

Right.

[Rachel Cruz]

And I'm not a guru. I don't have a crystal ball. My guess is we're going to see the same thing happen over the next seven years. We're going to see about 100% return.

[John Deloney]

And I think it's going to go half. I think it's going to be worse than that. And you know what, what's fun about this is you still win. It doesn't matter. Like me sitting here trying to predict.

[Rachel Cruz]

It, George, like we don't time the market. And that's what you're trying to do right now is go, well, I want to wait till the right time. I want to wait for a crash to invest. I wouldn't wait. I would invest now. And what you'll see is over time, the sooner you invest, the more money you're going to have later, the more time. Compound growth has to work its magic. And so I would. I don't know what headline you're looking at or what stock you're looking at, but I'm looking at the s and P 500, the largest 500 companies that largely represent the overall US economy. And that's, you know, when you invest in a mutual fund, that's largely what you're investing in as well. The top companies.

[John Deloney]

Can I give you some a different perspective, Jason?

[Jason]

Well, I mean what I was, well, worried about was rather than putting it in the stock market, should I go into CDs that are a little bit more secure but with less interest?

[Rachel Cruz]

If you want to lose money, yeah.

[John Deloney]

You'Ll lose money against inflation. Let me, let me. Can I throw something else at you, Jason? Something totally different. You got $100,000 and you paid 40 grand of your debt off, which left you with 60. You took $20,000 and created a trust for your kids, especially a special needs Trust for your three year old. Right. So that leaves you with 40 grand. Do you and your wife have a house?

[Jason]

Our house was a gift from my father in law. It's paid off.

[John Deloney]

Okay, so you have a paid off home.

[Jason]

Yes.

[Rachel Cruz]

You have an emergency fund.

[John Deloney]

Is this. You have an emergency fund where you are now your own bank?

[Jason]

I don't. No, I, we only make about 30, $37,000 a year because I'm a stay at home dad. I'm a caregiver for my son.

[John Deloney]

Well, listen to me.

[Jason]

So I don't really work.

[John Deloney]

You now have $40,000. I want you to put it in a High yield savings account. And now you have six months. If anything ever happens, you've got six months of taxes, bills, groceries in an account that you never have to borrow money again. And I want you to look at what you're actually solving for. What you are trying to solve for is you're trying to look at a crystal ball and see what's going to happen in 35 years because you're still in the backdraft of the pain of losing your mom, of losing your brothers, losing your dad. The one thing you have never had in your home is peace. And instead of trying to solve for the next calamity coming, which by the way, they're going to keep coming. That's just life. And it sucks. It is. I want you to solve for peace so that when those things come, you don't have a care in the world. You can just focus on being sad, on grieving. Because right now you have. You are in a financial position that very, very few Americans are in. And that is you don't owe anybody anything. You have a paid for house. You now have six to eight months of cash in the bank. That's just yours, period. Nobody can take your house away. Nobody can take food off your table. You see what kind of position you're in, right? That is peace, homie. I would solve for peace. And your main breadwinner in your house makes 37,000 bucks. That's not going to be enough money over the long term. You're going to have to figure that out. But right now, you all are safe. Okay? Do you get what I'm. You get what I'm getting at?

[Jason]

Yeah.

[John Deloney]

I would not invest any of this extra money. That's just me.

[Jason]

The main breadwinner isn't making enough. And I run my own small business selling stuff at farmers markets to try to make extra money. But in three and a half years, I'm only at. I only make about $10,000 a year.

[John Deloney]

Okay? So let's quit that job.

[Jason]

Anything that's literally just dumping it into re. Into the company. I don't even pay myself.

[Rachel Cruz]

Yeah.

[John Deloney]

So it's been a hobby. And we're going to stop that now. You're tired. I can hear it on you. You're exhausted. You're playing whack a mole with the next anxious thing that pops up. Let's just stop. Let's just put the. Stop putting quarters in the machine. Quit playing. Does that sound. If you hear my voice, does that sound good?

[Jason]

Yeah, I mean, I'm just.

[Michael]

It's.

[Jason]

It's It's. I do a lot. I know. I mean, I haven't. Be honest with you. I haven't grieved for my mother because I know you have too much to do.

[John Deloney]

I know you.

[Jason]

I have too much to do.

[John Deloney]

I know. But here's the thing. Your body's grieving whether you stop and do it or not. So I'm just.

[Eric]

I'm never.

[Jason]

I've never stop. I never stop, man.

[John Deloney]

I'm.

[Jason]

I'm going non stop. I know what to do.

[John Deloney]

And as my friend in Simpkin says, if busyness is your drug, rest will feel like stress. And right now you're medicating with whack a mole. You're medicating with busy stop tonight. It's the weekend. I want you to. You're about to come up on Thanksgiving for the first time without your mom. I want you to write mom a letter tonight, and I want you to tell your mom how much you miss her. And I want you to tell your mom in that letter what kind of dad you're going to be, what kind of provider you're going to be, and how you're going to give peace to her grandkids that she'll never get to meet. Okay, you're burning your hole through your home right now with your anxiousness. I want you to relax. You're safe right now. You got to pay for a house. You got 40 grand in the bank. You have a small account set up for your kids future man, you got life insurance on everybody. You're so far ahead of the game. I mean, now you got to turn and sit and just exhale in the sadness. And that's part of the. Part of the deal.

[Rachel Cruz]

We got to make Jason well again. And then this whole thing will take care of itself.

[John Deloney]

And then we got to deal with the money we'll have to deal with, you know, how are we going to. Like, we don't make enough money to eat, and what job am I going to do? Am I going to go back to school? We can figure all that out. But right now, we're going to exhale. We're safe. We're going to grieve, mom. And then when the new year rolls around, we're going to figure out what comes next for our family. Thanks for the call, brother. We'll be right back.

[Sam]

Hey, guys. I've never done this before, but I'm partnering with a nutrition company, Field of Greens. Each fruit and vegetable in Field of Greens is selected by doctors to support heart, liver, and kidney health. Plus metabolism for healthy weight. And your doctor will notice your improved health. Field of greens will give you your money back. I can get behind a promise like that. Go to fieldofgreens.com Ramsey and get 15% off with promo code Ramsey. Fieldofgreens.com Ramsey.

[John Deloney]

Welcome back to the Ramsey Show. The Employee Benefit Research Institute recently did a study asking how many people have a million dollars save for retirement. According to the research, only 3.2 of Americans have a million dollars or more in their tax advantaged accounts like a 401K and IRAs. 58% of Americans have less than $10,000 saved in their retirement accounts.

[Rachel Cruz]

Dude, that, that's dark stuff.

[John Deloney]

That's. I had no idea it was that bad. Sit. 60%. 6 out of 10Americans basically could, could do a month and a half in a retirement home. That's it. As a listener of the Ramsey show, are you staying on track with the baby steps to reach your financial goals? Here's the deal. Take a quick quiz to check your progress and receive a personalized plan just for you. Simply head to the show notes, click on the link titled are you on track with the baby steps and complete the free quiz. If you are one of the six out of ten of Americans that have less than ten grand, there is a light for you. But you gotta get on it. Right? You have to, you got to begin to act differently. George that would, that would freak me out. That would scare me to death.

[Rachel Cruz]

Yeah. And people think it's a life sentence. They think their, their DNA inherently has this in them where they go, well I'm just going to, I'm a broke person. John yeah, you can change. You can just snap your fingers and go I don't want to live like this. I want to change my family tree. I don't have to retire broke. And so this quiz will help you start to take the next step. Figure out where you're really at.

[John Deloney]

If you, and if you just look at man, basic demographic data, this same six out of 10 who have less than 10,000, I'll go as high as 70%, 80% that are, that are fragile.

[Rachel Cruz]

It's about the same stat that are living paycheck to paycheck.

[John Deloney]

But also everybody knows that there's, they're ringing the bell saying hey, your Social Security is going to be less than like we're, we're not solvent here in the next 10, 15, 20 years.

[Rachel Cruz]

By 2034, they're going to reduce the benefit by 27%. So there is, it already wasn't that high.

[John Deloney]

It's a slow car crash coming.

[Rachel Cruz]

You got to be your own financial plan.

[John Deloney]

Act today. Act today. Act today. Check out the show notes. Are you on track with the baby steps? Complete the free quiz. Stare down this anxious moment in your life and begin to do something different. Let's go out to Stamford, Connecticut and talk to James. What is up James? Everything above the nose.

[Michael]

John and George, how's this day finding you?

[John Deloney]

Excellent. The same. What's up?

[Michael]

Excellent. I need some advice. We're going to tread a little bit carefully because I am trying my best to thread the needle with my mother in law. She keeps giving financial and career advice to my family, specifically my wife, that do not work for our family situation and really do not work in 2024.

[John Deloney]

So James, you do not have a problem with your mother in law. She has your proxy war. You have a problem with your wife.

[Michael]

I would think that you are probably correct. I am worried that my wife is going to listen to her mother. My mother in law was able to raise four children in the Midwest through the 80s and 90s without working. She I don't believe has ever worked a 40 hour a week job in her life. She couple of days, you know, helping out at this nursery school, couple of days here.

[Rachel Cruz]

So what do you disagree on with your mother in law? What does she want your wife to do?

[John Deloney]

Stay at home?

[Michael]

Well, yes, basically all of the advice that she's giving involve things around. We have two children under six and it's comments along the lines of, you know, when both the kids are out of daycare, my wife works as a daycare teacher as well. When the kids are out of daycare, you can leave that job and just teach music lessons. I make 60 an hour teaching music lessons and that's great, but that doesn't make up for the income that we need in order to live where we live.

[John Deloney]

Here's the thing, Jason, who I have the greatest mother in law who's ever lived. She's amazing. And I expect my mother in law to give the advice that she sees fit for how she wants the world to work. I acknowledge that too. But when it comes to the life that me and my wife have to build for ourselves, she doesn't get a vote. And so your mother in law can say whatever she wants. Good for her. That's awesome. It's amazing. She's not the problem here. The problem here is you and your wife are not on the same page. And so it doesn't do. It doesn't matter what your mother in Law is saying it matters that you look at your wife and your wife says, hey, I want to stay home. And you say, we can't afford to do that, or we can, but here's what it's going to cost. You have to sell the car. We can't live in this particular house or in this particular neighborhood.

[Eric]

Yeah.

[Michael]

And at this point, we're having to have this conversation about every six to nine months or so. And I've tried showing my wife the math and that it does not work.

[Rachel Cruz]

So, James, I'm hearing your wife wants to stay home. If she could have it her way, she would stay home. Is that true?

[Michael]

I think that she gets the impression that she is working to pay for daycare and nothing else and that once the children are out of daycare that that need might disappear and then she.

[Rachel Cruz]

Wants to stay home.

[Michael]

I think so. I think part of it may be a byproduct to. That's the home environment that she was raised in. So she has seen it work. But that I don't think is realistic or sustainable.

[Rachel Cruz]

I want you to reverse engineer Yalls dream that you decide together. And that might mean, okay, here's the math of it. We can't do this right now. Here's why. But if she says, hey, my dream is really I want to stay home and you want to support that dream, then you go, let's do the budget. What's it going to take? Okay, I need to do this. Many more music lessons. We need to do this. We need to cut our lifestyle by this to get in a financial place in order to do this. So I think she's the wow, you're the how. And you're going, well, we have no way to actually accomplish this. But then there's also the part of you don't want this to happen right now. So this is really, like John said, this is between you and your wife. She wants to stay home, you don't want her to stay home. And you take the mother in law out of it.

[John Deloney]

Yeah. You keep crafting all these stories and imaginations like, well, it's probably because of this and maybe it's. It doesn't matter. Just forget all the story parts. Just sit down and look at the woman that you've made humans with. Look at the woman that you said, I do till death do us part. Like, what kind of life do we want to have? What do you want this house to feel like when we get home every day?

[Rachel Cruz]

How much are you making a year, James? Just. Just you?

[Michael]

Just myself about 60,000.

[Rachel Cruz]

And are you doing music lessons full time?

[John Deloney]

No, mother in law does.

[Michael]

My wife, no, she's a music teacher by trade.

[Rachel Cruz]

What are you doing full time?

[Michael]

I am a program director for a medium sized nonprofit.

[John Deloney]

Okay.

[Rachel Cruz]

Okay, so I think we also need to go. Okay, if this is in the future, my wife staying home, we're going to be a one income family. What changes do I need to make, what education do I need to get, what career moves do I need to make in order to sustain a good life for my family? And that's the part that I think scares you is this involves you having to change too.

[John Deloney]

Or at least it involves y'all having to have a truthful conversation about, hey, what do I want, what do I, what do I really want? I really want to work at this job. I love my nonprofit work and I know I make half of what I could make in the, in the, in the for profit world, but I feel valued and loved here. And then your wife looks across the table and says, I really want to stay at home with our kids. I see what happens in daycares. I want to be with our kids. Okay, now we have a desires challenge. Both of us are being honest, both of us on the table. Now we're just going to look at them at math does not care about what we want. Math is just math. So let's look at the math problem we have here. And maybe it's for three years I'm going to stay at this nonprofit, but I'm going to work an extra job so that you can stay home because I know that's important to you. And maybe it's, you know what, for three years I'm going to keep working at daycare because at least I get to see the kids half the day. And we're not netting a lot of new income. But this mission that you're called to at this nonprofit is really important. But now y'all are actually talking substantively, you're being honest with one another and you're putting your hearts and minds and souls on the table like you promised each other you would at your wedding. And your mother in law doesn't get a vote. But right now when your wife says, well, my mom says that I, that's her knowing if I, she just tells you what she wants, you're going to blow by her with a spreadsheet. And when your wife says something and you go, well, it's just your mother in law speaking, that's you not being able to say, hey, I really love my work it means something to me. Do you get what I'm saying? Let's just take mother in law out of the equation. Let's just talk directly with your wife. Is that possible? Yeah. Yeah, most of the time. You sound like a. Actually, you sound a lot like me, brother. You sound like a spreadsheet guy. You can pull up a spreadsheet and you can make the math work or you can be real honest about it not working. I want you to sit down with your wife and talk about emotions and feelings, which is maybe a scary thing. Here's how I feel about this. Here's what I want. I feel like your mother in law has a seat at our table, at dinner table. I feel like your mom has a seat in our bedroom. I don't want her in here anymore. I want it to be us. What world do we want to create? Thank you so much for the call, my brother. This is the Ramsey Show.

[Sam]

Do you ever feel like you're finally making progress towards your goals only to get quickly distracted by something else in your feed? Well, that's why we created the Ramsey Network app. Your single source for content, content that keeps you motivated. The Ramsey Network app is designed to keep you laser focused on reaching your goals. Loaded with over 7,000 hours of Ramsey shows, this free app is the best place for uninterrupted content and no distractions. Plus, you can search specific questions to get more personalized content in seconds. So for the days you need some extra motivation, you'll have proven advice at your fingertips. It's time to get serious about your goals and shut out the distractions for good. Simply search Ramsey Network in the App Store or Google Play. If you're listening on a podcast, just click the link in the Show Notes to download our free Ramsey Network app. Today.

[John Deloney]

Live from the headquarters of Ramsey Solutions, it's the Ramsey show, where we help people with their finances and getting out of debt. We help people do work they love, and we help people with their relationships and mental and emotional health. I'm John Deloney, joined by George Camel. We are taking your calls live at 888-825-5225. Let's go out to British Columbia, Canada and talk to Allison. Hey, Allison, what's up?

[Meg]

Hi. I have a quick question for you guys and it might not be a short answer, but let it rip. Yeah, it never is. Right? So my husband and I have about $3.2 million worth of debt total, and most of that is in our business, but some of that is personal. And I'm just Wondering, is it better to focus on paying personal debts before your business debts?

[John Deloney]

I have a friend named Denny, and he can help you change your identity. I think you should hook you all up.

[Rachel Cruz]

Allison. Allison, here's. I hate. I'm like, am I the first one to tell you this? That's all personal debt?

[John Deloney]

Yeah.

[Rachel Cruz]

You guys signed the dotted line. There's no, like, magic businessman who gets to take the brunt of this.

[Meg]

Yeah, that's fair.

[John Deloney]

What's this debt? What's the business?

[Meg]

So it's a medical practice that my husband and I own.

[John Deloney]

Okay. Are y'all physicians?

[Meg]

He is. I am more of an office manager.

[John Deloney]

So how are y'all working through it? Are y'all. Are y'all making enough to pay your bills? Are y'all working to pay this thing off? How's it. How's the business working?

[Meg]

Like, we got it 100% fully financed from the banks, so we do have a big loan from them, but we are able to make our payments every month, which is great.

[John Deloney]

What's the debt service on that?

[Meg]

I'm just wondering, what's the number for debt on that?

[Rachel Cruz]

What's your payment every month on 3.2 million. What are you paying to lenders every month total?

[Meg]

I think it's around 30k.

[Rachel Cruz]

And what is the. What is the practice bringing in between you two? And profit?

[Meg]

So our profit at the end, like, we only owned for about two to three years, but the profit every year that we've gotten is about 250 to 300. And that's after all the bills, all the loans, staff costs, everything is all paid.

[Rachel Cruz]

So you guys are essentially, your gross income as a household is 250, 300. Yeah, but then we have to make all the debt payments.

[John Deloney]

That's your take home.

[Meg]

Well, that's not what we take home. In our personal account, we pay ourselves as contractors, and so we only pay ourselves about 12 grand a month.

[Rachel Cruz]

Okay, that's my. Are you saying your profits are after making this $30,000 monthly payment?

[Meg]

Yes.

[Rachel Cruz]

Okay. Okay. So how many debts are there total if you split everything out?

[Meg]

So for our business, the reason I split it up is because they're in separate accounts and they're also taxed differently. But yes, it is all kind of one number. But for the business, it has $2.6 million worth of debt, and then the rest of our debt is all personal.

[Rachel Cruz]

Okay, so what is the other 600?

[Meg]

So for the personal stuff, so my husband, because he's a physician, he graduated probably 5, 6 years ago from school he has 300k worth of student loans that he has to pay back still.

[Rachel Cruz]

Okay.

[Meg]

And then we have 20k for our car, 215 for our house that we still owe, and then I have 4k from my schooling as well.

[Rachel Cruz]

Okay, so your question is, what's the best way to tackle all of this?

[Meg]

Yeah, like, where do I start? Is it more important to focus on paying personal stuff off or business stuff? I know it's best to kind of tackle everything at once if you can, but.

[Rachel Cruz]

Well, I mean, just based on the sheer numbers, if you just do the debt snowball, that would be your student loan first, then the car loan, then his student loans, then the business debt, and then the mortgage would come later.

[Meg]

Okay. So mortgages always last.

[Rachel Cruz]

Then the mortgage is a baby step six item. So you can consider this kind of a consumer debt. I mean, 2.6 million. That's trumping all of these other debts. It's going to take a while to pay this off.

[Meg]

Yeah.

[Rachel Cruz]

So my guess is you probably have the mortgage knocked out by the time the business debt is knocked out. I'm hoping you guys continue to make more, take home more, and use more to tackle the debt, because right now, that's my question. You're bringing home 150 grand a year.

[John Deloney]

Are you paying each other 12, each of you 12 grand a month or just as a family? You are taking home 12 grand a.

[Meg]

Month as a family. So we. We do split income. Okay. Because I manage the medical practice and he physically works in the practice.

[John Deloney]

Okay.

[Meg]

So we just pay ourselves six grand each.

[John Deloney]

Okay. Gosh, man. He's the most. So is his reimbursement capped in Canada?

[Meg]

I'm not really sure. That's a good question, though, because I know that we can claim capital gains, but that only comes, like, if we ever sell.

[John Deloney]

Yeah, no, that's not what I'm talking about. I'm talking about, like, because of the medical system y'all have in Canada, is there a cap on what he can charge per procedure or which procedures he can do or how many patients he can have? Can he work on Sundays? I've heard there's a cap for physicians that after you make a certain amount of money, physicians just take the next four months off because they can't make any more money.

[Meg]

I'm not really sure how that all works. I'll have to. To ask my husband.

[John Deloney]

Okay. If. If y'all were in the United States, you had a medical practice, I would tell you there's way y'all need to earn more money. Yeah, because paying off $2.6 million for $200,000, that's going to take you forever.

[Meg]

Yeah, right.

[John Deloney]

What's that? Is that 13 years? Like, y'all gonna have to make more money and all. All of your nurses are going to want raises. Like, everything's going to go up. Right. And so, like, that's expensive. I just don't know if y'all can do that in Canada.

[Meg]

Well, we just hope that interest rates go down and so we pay less interest on our loans.

[John Deloney]

Oh, sister, you have a. You have an adjustable rate loan on this thing?

[Meg]

Yeah, we do in Canada.

[Rachel Cruz]

Is it every five years they adjust the rate?

[Meg]

I think. I think it's every five years. Yeah.

[Rachel Cruz]

That's not on mortgages. That's on all loans.

[Meg]

Not on all of them. That's only with the business one, which is the two.

[Rachel Cruz]

Which is the giant one.

[John Deloney]

This new segment is brought to you by dollar Dr. Butler's hemorrhoid spray, because I now have hemorrhoids.

[Rachel Cruz]

Here's some basic math for you. On the business loan, you pay 260 grand a year. It would still take 10 years, and that's 260 grand of extra money beyond all of your bills that you can throw at the business debt. So that's why we're saying we need to drastically get our income up. I'm guessing there's no way to get out of this. Like, I mean, even if you sold the practice, you're going to lose to the tune of a million bucks, I'm guessing.

[Meg]

Yeah. Yeah.

[Rachel Cruz]

There's only one way out then, and that's to increase income and decrease expenses, both in the business and in your personal life.

[Meg]

Okay.

[Rachel Cruz]

Which means vacations are off the table. We're not getting any more car loans. You may want to sell the car and downgrade. Truthfully, it's such a small percentage of this debt, I would just pay it off and keep the car.

[John Deloney]

He's working Saturdays and probably being the only doctor's office open Sundays for half day on Sunday. Like. Like there's just not a way. Y'all just dug yourself a humongous hole. And so you have to just get it. Find a way to get a big shovel.

[Meg]

Yeah, yeah. We'd have to try to find another doctor to hire and work with us part time or something like that, potentially.

[John Deloney]

But you got to make sure that works because that doctor is going to come in.

[Rachel Cruz]

They need a hefty salary coming to salary.

[John Deloney]

Right. So he's going to have to. Or she's going to have to earn beyond their weight. Right.

[Rachel Cruz]

They need to bring in 600 grand a year to get paid. 300 grand a year.

[John Deloney]

Right. And it may be that you'll do with one less nurse and you and or your husband has to pick up some administrative duties that most fancy physicians just. Just pawn off on their nurses. But here's what I would do in order. Number one, as George said, I would split off the personal stuff. What's our take home? We're making 140 grand a year. We're going to pay off our consumer debt, and we're going to hammer this student loan. When it comes to the business man, I'd find out what is your cap in the medical system that you guys find yourself in Canada? And then I'd figure out ways to increase drastically the income of this practice.

[Rachel Cruz]

I couldn't sleep with that much debt, John. I'm so sorry, Allison. I hope you guys get out of this unscathed.

[John Deloney]

This is the Ramsay Show. This show is sponsored by BetterHelp. This month is all about gratitude. And most of us have people in our lives who we're grateful for. One of those people, for me, is the great Jean Noel Thompson. He taught me how to be a dad, a husband, a professional, and how to balance caring for a bunch of people all at the same time. We all know of somebody else we can be grateful for, but there's one person that we often don't take time to thank. Ourselves. We don't always acknowledge that we're surviving, that we're moving forward, and that we're working towards a better life and better relationships. And in a world where everything's gone bonkers, it's not always easy. So here's my reminder to thank the people that you love, thank the people in your life, and thank you. Sometimes we need some professional help to talk to. Somebody trained to help us discover true gratitude for ourselves and others, especially in the holiday season. That's why I recommend BetterHelp. BetterHelp is 100% online therapy, and you can talk with your therapist at any time so it's convenient for your schedule. Just fill out a short online survey to get matched with a licensed therapist. Plus, you can switch therapists at any time for no extra cost. Let the gratitude flow with BetterHelp. Visit betterhelp.com DeLoney to get 10% off your first month. That's BetterHelp. H E L p.com DeLoney hey, guys, it's Rachel Cruz.

[Dave Ramsey]

And guess what? It's my favorite time of year. The lights, the Music, the decorations. I mean, I love it all. And as a natural spender like myself, it's really easy to overspend. And I want to do all the things and give my family the kind of holidays they'll always remember. And at the same time, I don't want to look back at my bank account in January and think, oh, what did I do? So that's why I use the EveryDollar budgeting app. It helps me plan for all of my spending and that's what a budget is. Then once I have my plan in place, I don't have to worry about overspending. I am free to spend guilt free and have fun doing it. Plus, with EveryDollar, you can customize your budget however you want. So whether it's buying gifts, hosting dinners, or even turning your living room into a winter wonderland, everydollar helps you plan for it all. So you guys go out and create some great holiday memories with your family without the stress of overspending. Download the EveryDollar app for free today. Go download it today.

[John Deloney]

Welcome back to the Ramsey Show. I'm John Deloney. Let's go out to. Oh, I'm joined by George Camel.

[Rachel Cruz]

Thanks, John. I'm here too. Happy to help.

[John Deloney]

I felt you kicked me under the.

[Rachel Cruz]

Blessed be a blessing.

[John Deloney]

I don't even know what that means. Let's go out to Cincinnati, Ohio, talk to Eric. What's up, Eric?

[Michael]

Good afternoon. I hope everyone is doing well.

[John Deloney]

We are running a scam here called a podcast YouTube show. Man, we're doing great. How about you?

[Michael]

Couldn't be better. Thank you so much.

[John Deloney]

It's awesome. What's up, brother?

[Michael]

So fun, so fun fact. I've heard about you guys back in like senior year 2012. Heard all about the baby steps and from years on I've been on and off, on and off. And I hate to say it, I haven't been really committed to the whole thing. It wasn't until this year when I almost got evicted that I. Well, evicted from my apartment that I decided, yeah, I need to change. I need to be dedicated. I need to be devoted. So I am for real this time going through the seven baby steps as we speak, man.

[John Deloney]

Drinking the Kool Aid, finally.

[George Camel]

Yeah.

[Michael]

So I've art. I've been completed baby step one. I have a thousand dollars currently saved up. As of last week, I've paid off the only debt ever had, which is my medical bill. And I'm currently ready to start baby step three. And this is where my question comes into play. So I did My own little research about where to put that thousand dollars I have. And two things keeps popping up. One is a money market account and the other is a high yield savings account.

[Rachel Cruz]

Good research.

[Michael]

My question. So my question is which of the two overall would be the better choice for me as well as what situation would one be better than the other?

[Rachel Cruz]

I'll tell you what I do. And most folks out there following the Ramsey plan, they're remarkably similar. The money market versus the high yield savings. The money market may have an extra benefit. Like you can write checks out of it. It might come with a debit card, but outside of that they're a savings account. And so I have a high yield savings account. And you're going to get some still really decent interest rates. We're talking over 4% with some of the good ones out there. And that'll help your emergency fund stay liquid, grow at the pace of inflation. And it's there to protect you. It is insurance. It's not an investment. So we're not trying to make money off of this thing, but we also want to keep it somewhere safe. That's FDIC insured, doesn't have any minimum balance and monthly fees and all of that. So those are the boxes you want to check when it comes to a good high yield savings.

[Michael]

Okay.

[John Deloney]

But also it's a thousand bucks, man. So you can drop it in a local credit union. Like I don't, don't step over dollars to pick up nickels. As my friend Lane Norton says, like.

[Rachel Cruz]

Don'T go chasing the neck. Well, it's 0.1% more if I move it here. So I would just choose one and stick with it.

[John Deloney]

Yeah, over complication is going to be your enemy at this point. Let's keep things simple, man.

[Michael]

Right. So. So which comes to another thing. Is there like any place that could look at to see like which would be the most beneficial place to put the thousand dollars? Because the one I currently the banker clearly have, I work with usa, been in there for like over years or since I joined the military. And they do this thing where it's like a.01%. So if I leave it there, I'm only getting a penny a month.

[Rachel Cruz]

No. Yeah, that's terrible. You can do better. So there's a balance here. And so we've got a great partner called Fair Winds. If you go to fairwinds.org Ramsey, they've got a bundle just for our Ramsey listeners. I've got a partner on my YouTube channel called Laurel Road. You can sign up@l Laurelroad.com George, that's the one that I'm using. John and Jade and Rachel, they're probably all using different ones. But the key here is you want it to be FDIC insured with minimum to no fees, and you can get that money easily.

[John Deloney]

And probably a good answer. A good question you might ask is yes. George and I both put our emergency funds into online high yield savings accounts. I'm pretty old school. I like to go to my local bank. I still like a brick and mortar like bank from my house stuff. But I do have my emergency fund in a high yield savings account.

[Michael]

Okay.

[Rachel Cruz]

And the reason there is simple. They have less overhead because they're online. They don't have all the brick and mortars. They don't have to cover as many bills and hire as many people so they can pass on their savings to you in the form of a higher interest rate.

[John Deloney]

But me, as my wife says, being born in the wrong century, I still like to shake the hands of my banker. I want to see their face. So I have both.

[Rachel Cruz]

I want a bank with a local bank for my checking account and for my high yield savings. I'm fine putting that online knowing that I'll touch it, you know, once or twice a year.

[Michael]

Okay. It's interesting that you say that because I do have two banks. I have one bank for like general purpose. My second bank, where again, that's where my thousand dollars is at. And I was always thinking of looking for a third one to take my thousand dollars and let that.

[John Deloney]

No, you don't need to overcome. You're going to get too complicated. Too many. Yeah, you're going to be like triple stamp and a double stamp.

[Rachel Cruz]

Minimalist.

[John Deloney]

Just. Yes.

[Rachel Cruz]

A checking account with a good local bank, a credit union is a great option. And then for your emergency fund or you know, short term savings, we'll call it one to three or four years. A high yield savings account with a great online institution is great. I mean, credit unions can sometimes have great rates.

[John Deloney]

They're amazing.

[Rachel Cruz]

So.

[John Deloney]

Hey, can you do me a favor, Eric?

[Michael]

Yes, sir.

[John Deloney]

This is kind of impromptu in front of, I don't know, several million people. You cool?

[Michael]

Yeah, that's fine.

[John Deloney]

Will you do like an impromptu debt free scream if we count it down?

[Michael]

Okay.

[John Deloney]

You just. You paid off all your debts, right?

[Michael]

That's correct.

[Rachel Cruz]

How much debt was it and how much was it?

[Michael]

It was around 500 bucks. It was a medical bill.

[John Deloney]

You. You owed 500 bucks.

[Michael]

It's a long as emergency situation.

[John Deloney]

No, that, that's that's the smallest debt I've ever heard paid off. That's amazing.

[Rachel Cruz]

This could be a world record smallest debt free scream ever. How long did you have the debt for?

[Michael]

Oh, my goodness. I've had this since I want to say December, if not January.

[John Deloney]

Wow, Dunsky. All right, so Eric making $100 million paid off his debt of 500 bucks in. Would it take you one month?

[Michael]

It did.

[John Deloney]

Excellent. Count it down, dude. Let's hear your debt free screen, Merrick.

[Michael]

All right.

[John Deloney]

I'm debt free. That's right. Way to go. Even got it.

[Rachel Cruz]

There we go.

[John Deloney]

Hey, man, we celebrate that. We celebrate the big ones and we will celebrate the 500 debt free screams. Because here's the deal. Freedom is freedom is freedom, right?

[Rachel Cruz]

And it comes with a promise. You gotta promise not to go into consumer debt ever again.

[Michael]

I promise. Promise, promise, promise.

[Rachel Cruz]

You're following this Ramsey plan now after ignoring it for 12 years. And it's about to change your life, man. I wanna set you up for freedom. We're gonna hook you up with my book Breaking Free from Broke, as well as a year of every dollar premium so you can budget your way to that emergency fund and investing and everything beyond.

[John Deloney]

George, how many people do you see get to the stage and begin to try to over sophisticate things?

[Rachel Cruz]

The amount of complication we try to do because it seems too simple. We're like, no, it's got to be more complicated to be smart and efficient and great. And I'm going, no. If you look at Dave Ramsey, who has more, he has enough wealth to, you know, feed my family for 17,000 generations. He owns mutual funds in real estate.

[John Deloney]

Yeah.

[Rachel Cruz]

He doesn't have a crypto wallet. He doesn't have 17 offshore accounts. He doesn't make it overcomplicated. And that's what I found. It's the people that don't have wealth that want to overcomplicate it. The ones that do have this dirty little secret where they go, yeah, I just. I have a savings account, I have money in the bank. I invest in the stock market. I own paid for real estate.

[John Deloney]

And it's always amazing to me that when you get around those people, they have a different energy about them.

[Rachel Cruz]

You're expecting more. You're like, no, but wait, there's a secret.

[John Deloney]

No, but it's this. It's just like my give a crap. I took it apart and I ebayed all the parts. Like I did. Like if you're around Dave, just like when we go hang out, right? When we Go to his barn. Or we are out traveling. There's just an air of like, yeah, I don't care. And it's because I, I've just in a complicated life. Right. I'm gonna, I'm gonna do the things I got to do to make things as simple as possible. And you and I both have been hit up by the. By the Instagram finance bros that are like, oh yeah, you pay off your 3.2% mortgage and you could get 4.8%. It's like, bro.

[Rachel Cruz]

And they use the word arbitrage and then a puppy stops wagging its tail.

[John Deloney]

Exactly.

[Rachel Cruz]

Oh, it's exhausting.

[John Deloney]

It's like, yeah, get the whole life.

[Rachel Cruz]

Policy and then you can borrow against it. And then you need 16 credit cards to maximize the re rewards. And I'm going, dude, listen to yourself talk.

[John Deloney]

Exactly.

[Rachel Cruz]

Sound like a crazy person trying to maximize your freaking rewards to get an extra 1% arbitrage to pay for that first class flight so you can take a picture of it and post it to your Instagram. It's exhausting.

[John Deloney]

Yeah. You know what I have? I have a. An Olympic wrestling mat in my living room that I just wrestle with my daughter. I'd rather spend my energy doing that.

[Rachel Cruz]

That's. That's a flex right there.

[John Deloney]

Or like, hey, wife, let's go for like a two hour walk tonight and leave the kids rather feral. Let's just go spend time together.

[Rachel Cruz]

What a thought. What if you could build a life that didn't exhaust you?

[John Deloney]

Yeah. That you exhaust everyone around excited to wake up and be a part of.

[Rachel Cruz]

Keep it simple.

[John Deloney]

Gosh. All for peace, people. We'll be right back.

[Rachel Cruz]

Hey, guys. George Camel here for Delete me. I saw a headline the other day that made me squirm. One third of the US population's background info is now public. We're talking 115 million Americans. Personal info out there in cyberspace for data brokers to buy, sell and trade, like Pokemon cards. And data theft happens all the time. Data brokers get your info, like your name, address, phone number, even your kids names. And then boom, it's available to online bad guys. But to that Deleteme says, not so fast. That's because Deleteme finds and removes your personal info from hundreds of these data broker sites. And they send you an easy to read report showing you exactly what they did and how much time they've saved you. What I love most is that Delete me reduces the risk for scams for me and my family. Not to mention that we get fewer creepy ads and robocalls. So it's time to take control of your online privacy. Their individual delete me plan. Start as low as nine bucks a month and you can get 20% off if you go to JoinDelete Me.com Ramsey that's JoinTelete Me.com Ramsey folks, the Ramsey.

[Sam]

Christmas Cash Giveaway is here and you could win big. We're giving away $500 prizes each week and one grand prize of $5,000. Enter daily for your chance to win at Ramsaysolutions.com giveaway. It's that easy. Plus our 50 Days of Christmas deals is on right now. Get up to 30% off bestsellers and life changing gifts that won't break the holiday budget. Ramsaysolutions.com store.

[John Deloney]

Welcome back to the Ramsey Show. I'm John Deloney joined by George Campbell, 888, 825-5225. The Ramsey show question of the Day this is a spicy one brought to you by why refi why refi refinances defaulted private student loans which are different than federal student loans. Why refi refinances your defaulted private student loans and builds a custom loan based on your ability to pay? Kick your private student loan debt out of your life forever by going to wirefi.com Ramsey that's the letter y r e f y.com Ramsey and this may not be available in all states.

[Rachel Cruz]

Today's question comes from Meg in Maine. I've been an avid follower for 20 years and I'm debt free. However, I'm facing a bit of a challenge and would love to get your advice. I travel quite a bit now that I'm semi retired and I've been considering getting a travel points credit card. My plan is to charge my travel expenses and large purchases then pay them off immediately. I feel disciplined enough to handle this without carrying any debt. Plus the idea of earning points and not carrying so much cash is appealing. But here's the kicker. Despite having a credit score of 833, I've been turned down for several credit cards since I haven't used one in many years. Do you have any suggestions on how to approach the situation or any alternatives I should consider?

[John Deloney]

I think you should get a credit card for points if you hate widows, orphans and those who are struggling to pay.

[Rachel Cruz]

Oh John, shots fired hot on here.

[John Deloney]

So I remember I was it's not for Ramsey. I was moving across. I was moving. I was taking a long move and the play the business I was moving was would pay reimburse my Move. There's a whole family with big old monster trucks. But I had to front it. And so I thought, oh, man, I'm going to open up a credit card and with points on it, and I'll make just free points because I'm just going to turn around and this new company that I'm working for is going to reimburse me for the move. So I did that. And I remember getting a whole bunch of free points for opening the card, and then I got a whole bunch more points for this massive amount of money I spent right out of the gate to move my whole family. Family. And then I was literally driving down the road, and I remember thinking, wait a minute. The credit card company is not my friend and the airline company's not my friend. Like, they're not hooking me up. Like, bro, you spent money with us. We're going to hook you up. Somebody's paying for this flight, and somebody's paying for these hotel stays. And when I dug into it, that's when, to my horror, I realized, oh, it's not the companies. It's not the credit card companies, not the airline. It's not the hotels that are paying for these rooms. It's the single mom with three kids who just left an abusive relationship, who is struggling to feed her kids, who puts this credit card in and then her boss cuts her hours and she gets a 50 late fee or a 39 late fee, or her APR goes from 13 to 29% in one month, she's paying for my flight. Or the single dad whose wife just passed away and, like, they're scrambling and scrambling. He opens up a credit card out of desperation, and then he misses a payment and it balloons on. That guy's paying for my flights. And it. It all of a sudden got very gross for me. Like, I don't want to be a part of this system. I travel. You and I travel a lot. I travel all the time. All the time. I'd rather pay for my own flights or work out a business arrangement with a company that's paying me to come speak for them than ever think I have some single mom who can't put food on her table, pay my bills, and it just got gross for me real fast.

[Rachel Cruz]

Yeah. I mean, there's a.

[John Deloney]

You did some research on this, right?

[Rachel Cruz]

There's a moral argument to be made.

[John Deloney]

Yeah.

[Rachel Cruz]

In my book Breaking Free from Broke, here's the. The quote from. From the book, a 2023 study by the Federal Reserve, they set out to determine who pays for these credit Card awards. And the results, though expected, are alarming. In the report, the Fed said we estimate an aggregate annual redistribution of $15 billion from less to more educated, from the poorer to richer, and from high to low minority areas, widening existing disparities.

[John Deloney]

Simple.

[Rachel Cruz]

And here's it gets worse, John. As they dug into it, families with household incomes below 40 grand are less likely to even qualify for these rewards, but they're more likely to pay late fees and additional interest. The family's making 100 grand or more, obviously more likely to have access to these reward cards and less likely to pay late fees and interest. So it's not saying you're a bad person if you use the rewards. This is not like a moral argument to tell you John's a better person than you. I mean, but John sleeps better at night because of it.

[John Deloney]

I. Yeah.

[Rachel Cruz]

And can you play the game? Sure. Is it worth the 2%? Let's say you spend 25 grand. I mean, is it really worth that?

[John Deloney]

Well, they put in huge font. Cash back. Right, Cash back.

[Rachel Cruz]

And they go, well, it's points now, John, it's not cash. What's a hundred thousand points? I don't know. It's like Chuck E. Cheese. You spend a hundred dollars at Chuck E. Cheese to get a thing that's actually worth $7.

[John Deloney]

Right. So you get like a, like a cool monogrammed Bluetooth speaker. Like, because I got 100,000.

[Rachel Cruz]

No name brand. Yeah, you get some, you know, one of those sticky hands and a pack of gum and you're like, I spent.

[John Deloney]

20 bucks for this refurbished, like new balances. Right.

[Rachel Cruz]

So can it be done? Can you be super disciplined and beat the cyst? Sure. I don't think it's worth the brain calories and the energy and the money spent to try to do it personally.

[John Deloney]

And if you, I mean, geez, I don't want to make it a moral issue, but I want to call these programs to task. If you like the idea of somebody's of wealth being redistricted, distributed from the least of these in our communities to pay for your flights and hotels, knock your lights out for me. George just got gross. And again, we can line up the things that, that I need to work on. I'm not a better person than anybody, but in this one particular thing, this is just a hot button issue with me. Yeah, the. The banks aren't your friends, the credit card companies aren't your friends, the airline companies are not your friends. They're running businesses. They would not be giving you these flights if it was if they weren't making that money up somewhere else. Right. There's an, there's an old saying in the Internet world. If you get online and you log in and you have to put your, your email address in for free and you get a product for free, you're the, you're, you're, you're the product right there. You, they want you. Right. So it's similarly asking that next layer question, who's paying for these flights? Actually, who's paying for the advantage I just think I got, because they're not hooking you up like your friend or your neighbor.

[Rachel Cruz]

Well, when you think about this, let's say you do spend 25,000 a year on travel. I think we'd all agree that's a lot. That's a, that's a. Someone's traveling a lot with 25 grand a year and 2%, it's 500 bucks. You could put 40 bucks in a savings account every month and give yourself the rewards.

[John Deloney]

Yeah, absolutely.

[Rachel Cruz]

So you're never going to convince me because of humans being emotional creatures that psychologically you're not going to spend $500 more on that card over the course of a year because you're going, well, I'll get some points. Might as well get the nicer flight.

[John Deloney]

Well, and if you, if you fly like, like if you fly Southwest or America, you fly these companies all the time, you get flight points for participating. I'm okay with that. Right. Because they're marking up that your ticket and they're going to give you a piece. That's fine.

[Rachel Cruz]

If I fly 25 times of Southwest, I'll get a free flight.

[John Deloney]

Knock your lights out. That's fantastic. That's awesome. It's that next level of hey, my gasoline, my Snickers bar, my whatever, your haircuts. Which is a. I mean, that's a lot of money.

[Rachel Cruz]

I'd get some serious cash back, but instead, here's what I do with my haircuts, John. I pay cash and I get a discount.

[John Deloney]

I do. Because we use the same barber. He gives the cash discount.

[Rachel Cruz]

Exactly. So I'm like, well, I'm making more by paying cash than by swiping my card. Which, by the way, hurts the small business owner.

[John Deloney]

Right.

[Rachel Cruz]

Because they've got to now pay the 3% fee or pass it on to you all to get my 2% cash back. So either way, you are not the one winning. It's the card processing companies. It's Visa, it's MasterCard, it's Amex, it's Discover. It's Southwest, it's Delta. And these are not evil companies. This is how they do business. And you need to understand how they're marketing to you. There's a reason they're always offering you, hey, John, you're so wonderful. Here's more line of credit. We're gonna give you an extra $5,000 in credit that you can spend. You're telling me psychologically, I don't get the dopamine hit. That tells me I am winning. The banks love me.

[John Deloney]

Yeah, they love you. So I. I don't know. As for me, in my house, we solve for peace. And if I can opt out of a system. I like that. I like that.

[Rachel Cruz]

That's truly how we love people. Think. Well, they just have to say that on air. Dave secretly. No, you can check his wallet. You can check any of our wallets. There is not a single credit card to be found. And it's not because we're scared of Dave finding out. It's because we truly have no need.

[John Deloney]

For opt out of the system.

[Rachel Cruz]

Once we started following the Ramsey plan, we're like, oh, we can just use our own money and have freedom and control over our life. Great. Sign me up. Screw the rewards. It's just.

[John Deloney]

Where's that George Kibble T shirt?

[Rachel Cruz]

Screw your rewards. I like the one that says, go fund yourself. That one I'm still trying to get as part of Ramsey Merch.

[John Deloney]

That's fantastic.

[Rachel Cruz]

Yeah. I don't know that Dave's gonna go for it yet.

[John Deloney]

He could.

[Rachel Cruz]

I like that, though.

[John Deloney]

What? Hear a lot on the show.

[Rachel Cruz]

Imagine if America said, go fund yourself. Go fund your own retirement. Go fund your own credit card rewards, and America would be a better place. Instead of making banks and lenders richer.

[John Deloney]

If you made a shirt that said, go fund yourself, and I made one that said, that gives me hemorrhoids. You and I would both.

[Rachel Cruz]

We'd be billionaires.

[John Deloney]

America would buy those T shirts. This is the Ramsey Show. We'll be right back.

[Sam]

Well, it's decision time again. Every year during open enrollment, you have the chance to check in on your insurance and make sure it's right for you and your family, whether you have health coverage through. Through your job, a private company, or a government program like Medicare. You don't have to figure this out alone. We have reliable folks we trust to help you get the right coverage for whatever stage you're in. Go to Ramsaysolutions.com health coverage.

[John Deloney]

Welcome back to the Ramsey Show. 888-825-5225. I'm John DeLoney, joined by George Camel. This is the raddest thing I think I got going on in my life right now. Me and Dave Ramsey launching a brand new tour this spring called the Money and Relationships Tour. It's going to be gone.

[Rachel Cruz]

Oh, that is rad. Yeah.

[John Deloney]

Wheels off.

[Rachel Cruz]

So this is a very different event than we've ever done because there's no, like talks. There's no, like scripts. You guys are gonna riff based on what the audience wants to hear. Is that right?

[John Deloney]

It will not. Yeah. It won't be, like two one hour lectures. It will be chaos. It'll be a blast. It will. Yeah. The audience gets to vote on what we about. And Dave and I will have spent the last six months, like, researching and digging into these topics and then we'll spread them out and say, all right, y'all pick from this menu. What do you want to talk about?

[Rachel Cruz]

Wow. I think Dave's accidentally starting an improv troop. I never thought this day would come. This is amazing. This is as close as we're going to see to Dave doing improv. So you guys are heading out to six cities.

[John Deloney]

Six cities. So Louisville in April 21. Durham in April 23. Atlanta, April 25. Phoenix, May 5. Fort Worth. Fort Worth, Texas. Texas. Y'all got to show up for me May 7th. And then Kansas City May 9th. We're going to be there live. We're going to talk about relationship dynamics, your marriage, your kids, budgeting, financial goals, whatever you got. Your voice will drive the night. Get your tickets@ relate ramseysolutions.com tour by the way, great Christmas gifts. Ramseysolutions.com tour did. I was telling somebody on the audience, I just a little bit. I don't get nervous just being on stage with Dave for two and a half hours and letting it rip impromptu. I'll probably be a little puckered up.

[Rachel Cruz]

Yeah, I might show up to, like, the Atlanta one just to see what. What the heck happens there.

[John Deloney]

You can bomb with some questions from the audience.

[Rachel Cruz]

Amazing.

[John Deloney]

That'd be real fun, actually.

[Rachel Cruz]

I'll put on a fake mustache.

[John Deloney]

That would be hilarious.

[Rachel Cruz]

That'd be amazing.

[John Deloney]

But then we'd all find out that. Well, actually, you have a pretty nice beard going.

[Rachel Cruz]

Thank you.

[John Deloney]

It looks good. I haven't shaved in seven months. This is all I got.

[Rachel Cruz]

It's barely a five. It's like a four o'clock shadow. Couldn't even make it to noon shadow.

[John Deloney]

My face just gave up. Let's go out to. Let's go down the street to Nashville. And talk to Michael. What's up, Michael?

[Eric]

Not a whole lot, guys. What a bunch of stuff.

[John Deloney]

We're just running the scam out here. What's up, man? How can I help?

[Eric]

Alrighty. So got a question. So me and my wife have finally got to the point to where we paid off all of our debt and we saved up a pretty good amount of money. And we actually came into a pretty good amount of money as well on top of that. And we ended up putting a big down payment on a house. Now, unfortunately, we. I didn't want to be in a scenario where it took both of our income to pay the mortgage. And I'm a big farm guy. I had to have land. So we ended up with $300,000 in debt now on a home for 30 years. And I did pay my rates down to 5%. And like I said, I paid off everything. I have $10,000 into a emergency fund. I have 6,000 or so, six months of payments ready for any time. And right now it's currently only taking like $3,000 of our money to pay all of our bills. And we grow from anywhere between 8,500 to $9,000 a month. So my question is, yes, I know I went with a 30 year note. Would it be better just to pay double payments or literally take everything I got and just keep dropping it in there until I get it paid off?

[Rachel Cruz]

So you said your bills are how much per month? Total expenses about three to 3,500. 3,500. Okay. So you've got plenty of margin to the tune of, you know, five grand a month. You could just chunk at the mortgage and then you have how much? You said you came into some money. How much is sitting there outside of your emergency fund that you could use?

[Eric]

Outside of my emergency fund? I have. Well, I put everything in the three categories. I got 10,000 to emergency fund and I have just over 22, just for six months of everything.

[Rachel Cruz]

I'm going to call that your emergency fund. So let's get your emergency fund is 30 grand.

[Eric]

Well, I reason, I say I got 10,000 for you. Like, you know, vehicle, stuff like that. They tore up. With that being said, so yeah, we have $32,000. And I also have just like vacation money that we put in that we have close to five grand right now. Just that way we don't spend anything ext.

[Rachel Cruz]

So we're not going to touch the emergency fund. We're not going to touch the vacation money. Keep your sinking funds happening as they should, but all of your future Income. That five grand a month I would be throwing at the mortgage, my friend. How quickly do you think you could pay that off? I would go crunch the numbers in a mortgage payoff calculator@ramsey solutions.com and see for yourself how quickly you can pay off 300 grand. Making an extra $5,000 payment every month. It'll blow your mind. You'll be done. And probably my guess, four years, 60 grand a year on top of your normal mortgage payment. Probably four years instead of 30.

[Eric]

Yeah, I've already done that. We looked into that. I just didn't know if it would be smarter to put half of that money towards mortgage and invest half the other money into something else.

[Rachel Cruz]

Well, you should be investing already. Are you investing 15% of your income?

[Eric]

No, we have not. Like say we were. So when I got my wife, she had $100,000 in debt and it was all school debt. She's a school teacher. And I was big about getting that done, getting that out of our hair. And we spent the last three years just hammering at all of our big bills.

[John Deloney]

How much do you make a year? What's your household income? What's your household income?

[Eric]

Well. Well, before this year it was 120. Now it's 96. Because I became. I went from OTR to local.

[John Deloney]

Okay, can I, like I. Here's how I hear you asking this question. Like you're in the studio and you're standing with me and George and you just have your head hanging in shame. Do me a huge favor, man like George and I, would we sign off on a 30 year mortgage? No, I do a 15. That's what we recommend. You paid off all your debts. You didn't go crazy. You bought a $300,000 house. George and I both live in Nashville. We both recently bought places. I don't know where you found a $300,000 house, but God bless you and your family and your grandkids. That's amazing. You got yourself some land. You've paid off all of your debts, including the hundred grand that your wife can make. Hear me say this, dude, y'all are crushing it. You're doing great.

[Rachel Cruz]

And how old are you? How old are you two?

[Eric]

I am 34. She's 36.

[Rachel Cruz]

Oh, my goodness. So can I do some fun math for you, Michael?

[Eric]

Yes, sir.

[Rachel Cruz]

Okay, so let's say you start investing now and you do 15% of your income. That's about 1,200 bucks every month going into retirement accounts. I assume you have one through your employer.

[Eric]

I do.

[Rachel Cruz]

Good so will it shovel away 1,200 bucks into these tax advantaged retirement accounts in 23 years? That puts you at 57. Correct. You're going to have probably $1.4 million in that one account. And by the way, 23 years from now, your mortgage payment has been gone for like 20 years, which means you probably increased your investing and you've had freedom for the last, you know, two decades of your life and bought your.

[John Deloney]

Neighbor'S property and the property next to that one, the property.

[Rachel Cruz]

Do you see how it changes your options? And so you've set yourself up for that kind of future because of the hustle and grind you just spent the last few years doing. So I know you're tired, you're worn out. You're like, what do I do now? We got the money.

[John Deloney]

You think you did something wrong?

[Rachel Cruz]

Try to do 17 things at once. Just follow these steps, man. 15% of your income to retirement. Anything beyond that, throw at the mortgage and let's be done with it. Set a goal for, let's say, five years.

[John Deloney]

And if you're like me, okay, and I have like a kind of an obscene allergy to owing somebody something, I just, I hate people telling me what to do, and I hate owing somebody. Hate it, hate it, hate it.

[Eric]

It's like an itch that you just can't scratch.

[John Deloney]

Yeah. So sit down with your wife and say, okay, it's going to cost us three years of some b a N a n a s living, but let's just do this and get this thing over with. All right? 38 years old, that's fine. But you have to work weekends, Saturdays, whatever. And we're going to keep. We're just going to gnaw on this thing and gnaw on this thing till it's gone. If it goes beyond three years and y'all can't figure out a way to do that, just exhale and just say, okay, when I'm 40, I'm going to have a paid off house and make peace with yourself and go hunting tomorrow morning when the season opens. Like, you know what I'm saying? Like, you have done such a good job, man. You should be proud of yourself.

[Eric]

Yeah, I am, man. Like I said, we. So my wife, she's, she has this mindset like me. Like, I'm a big avid hunter, and every time I see something for hunting, like, I don't, I don't splurge on anything.

[Rachel Cruz]

I mean, you sound just like John.

[Eric]

Money to buy anything I want. But, like, I'm the type of guy that I'll duct take my boots before.

[John Deloney]

I have to go find you. Well, don't do that. Enjoy your life and have a good time. And also get this house paid off. For all of you listening to the show on YouTube or podcast, it's about to end. Head over to the Ramsey Network app and the party will continue. Go to the show Notes and you can watch the rest of the show on the app for free. We'll see you soon.

[Rachel Cruz]

Hey, you're still here. What are you doing? You do know that the rest of today's show is playing right now over on the Ramsay network app, right? All you gotta do to finish the episode is search Ramsey Network in the app store, Google Play store, or just click the link in the show notes to download the app for free. Yep, you heard me right. For free. Then right there on the home screen, you can watch the rest of today's show. Bada bing, bada boom. Alright, I'm getting out of here. Enjoy. We'll see you on the app.