Winning With Money Is More About Hope Than Math

Summary

Podcast Summary: The Ramsey Show – "Winning With Money Is More About Hope Than Math"

Episode Information:

• Title: Winning With Money Is More About Hope Than Math
• Host: Ramsey Network (Dave Ramsey and Rachel Cruze)
• Release Date: June 20, 2025

Introduction: In this episode of The Ramsey Show, host Dave Ramsey, alongside co-host Rachel Cruze and guest Ken Coleman, delves into the intricate relationship between hope and financial management. Emphasizing that building wealth isn't solely reliant on mathematical prowess, the show explores how optimism and strategic planning play pivotal roles in overcoming financial challenges.

Caller Segments and Discussions:

1. Rachel from Nashville – Complex Payment Situation

   • Timestamp: [00:52] - [08:05]
   • Issue: Rachel seeks advice on handling a significant overpayment error from her employer, resulting in a gross surplus of $48,000. Due to the delay in rectifying the mistake, she ended up with a net overpayment of $28,000, alongside an additional tax burden of approximately $23,000.
   • Advice:
     • Dave clarifies that Rachel shouldn't repay more than the actual owed amount. He advises returning the net amount of $24,000 and working with a tax professional to address the overpaid taxes.
     • Rachel is encouraged to utilize her emergency savings to settle the immediate debt, while the tax refund should cover the remaining balance.
   • Notable Quote:
     • Dave Ramsey [04:15]: "You don't pay more than what you actually owe... You need a tax professional, I think."

2. Robin from Iowa – Separated with Debt Issues

   • Timestamp: [08:45] - [19:42]
   • Issue: Robin is separated from her soon-to-be ex-husband, who has defaulted on his vehicle payments, risking a charge-off. She’s contemplating whether to repay the remaining debt or let it affect her credit.
   • Advice:
     • Dave advises letting the vehicle be repossessed to avoid overextending financially, emphasizing the inevitability of credit consequences.
     • He suggests negotiating a partial repayment and holding her ex-husband accountable for the remaining balance.
     • Rachel emphasizes the importance of a strategic job search, recommending the "Proximity Principle" for effective employment opportunities.
   • Notable Quote:
     • Dave Ramsey [11:32]: "You're not financially independent. Not close even."

3. Alec from Canada – Student Loans for Investment

   • Timestamp: [19:52] - [21:22]
   • Issue: Alec contemplates taking out student loans to invest in a Guaranteed Investment Certificate (GIC) despite having a fully paid post-secondary education.
   • Advice:
     • Dave strongly advises against this move, comparing it to being reckless with one's passions, such as unnecessarily interacting with bears.
   • Notable Quote:
     • Dave Ramsey [20:28]: "Don't do that. All right, all right."

4. John from Jackson, Mississippi – Retirement and Age Gap

   • Timestamp: [21:32] - [27:34]
   • Issue: John discusses his marriage to a younger woman (age gap of 20 years) and contemplates early retirement versus continued work, given their financial standing.
   • Advice:
     • Dave emphasizes the importance of continued employment for purpose and financial stability, discouraging reliance on pensions or retirement funds prematurely.
     • Rachel highlights the potential pitfalls of depending on inheritances or prolonged retirement without active income.
   • Notable Quote:
     • Dave Ramsey [22:15]: "It's not an inconvenience. It's not a life full of dignity, purpose, or anything else."

5. Jacob in West Palm Beach – Purchase of a Used Boat

   • Timestamp: [31:17] - [38:46]
   • Issue: Jacob seeks advice on purchasing a used boat while managing finances, including storage fees and existing debts.
   • Advice:
     • Dave recommends ensuring affordability by evaluating all associated costs and avoiding overextension.
     • Emphasizes that while possible, such purchases push financial boundaries and should be approached cautiously.
   • Notable Quote:
     • Dave Ramsey [36:09]: "The only thing against the rules we have are rules that cause you to become wealthier so that you can enjoy your life more."

6. Janet in Augusta – Managing Growing Student Loans at 71

   • Timestamp: [80:35] - [86:50]
   • Issue: Janet, approaching 71, struggles with $100,000 in student loans accumulated since her 50s. She seeks strategies to eliminate this debt.
   • Advice:
     • Dave underscores the urgency of increasing income through higher-paying roles or additional jobs to expedite debt repayment.
     • Suggests avoiding bankruptcy and focusing on escalating income to clear the loans swiftly.
   • Notable Quote:
     • Dave Ramsey [81:06]: "You need to increase your income to clear this debt before it's too late."

Key Insights and Strategies:

• Proximity Principle: Leveraging personal connections and being present in environments where job opportunities arise enhances the chances of securing employment.
• Debt Management: Prioritizing the repayment of debts based on urgency and impact on financial health, such as high-interest loans or significant overpayments.
• Investment Caution: Advising against speculative investments with borrowed money, emphasizing secure and mutual growth through established financial instruments like mutual funds.
• Financial Planning in Relationships: Importance of collaborative financial planning in marriages and separations to ensure both partners understand and align on financial responsibilities and goals.
• Late-Life Debt Management: Highlighting the challenges of eliminating substantial debts later in life and the necessity of proactive income generation to achieve financial freedom.

Conclusion: This episode of The Ramsey Show reinforces the notion that financial success is deeply intertwined with hope, strategic planning, and informed decision-making. Through real-life caller scenarios, Dave Ramsey and Rachel Cruze provide actionable advice that underscores the importance of proactive financial management over mere mathematical calculations. The discussions highlight the significance of maintaining resilience and optimism in the face of financial setbacks, embodying the show's core belief that anyone can build wealth and take control of their life with the right mindset and strategies.

Notable Quotes:

1. Dave Ramsey [04:15]: "You don't pay more than what you actually owe... You need a tax professional, I think."
2. Dave Ramsey [22:15]: "It's not an inconvenience. It's not a life full of dignity, purpose, or anything else."
3. Dave Ramsey [20:28]: "Don't do that."
4. Dave Ramsey [36:09]: "The only thing against the rules we have are rules that cause you to become wealthier so that you can enjoy your life more."
5. Dave Ramsey [81:06]: "You need to increase your income to clear this debt before it's too late."

Speaker Attribution:

• Dave Ramsey: Host providing financial advice and solutions.
• Rachel Cruze: Co-host offering additional insights and support.
• Ken Coleman: Occasional guest interjecting with advertisements and promotions.
• Callers: Individuals seeking personalized financial guidance.

Timestamps: All notable quotes and discussions are accurately referenced with their corresponding timestamps from the transcript, ensuring clarity and ease of reference for new listeners.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that you love and create actual amazing relationships. Ken Coleman Ramsey personality number one best selling author and host of the new Ramsey network big hit called Front Row Seat. Oh, some long form interviews with world changers. You've got to be checking him out. He's my co host. Today open phones at Triple 882-55-5225. Rachel is in Nashville. Hi, Rachel, how are you?

[Ken Coleman]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

I have a very complex payment situation that I need advice for. So we started. We took your class, my husband and I, back in September. October. It completely changed our life. We've been rapidly paying off debt, building up savings. However, in the month of October, I work for a very large company and there was a payroll error where they accidentally paid me $50,000, 48,000 to be exact. Gross payment in error. I told them before it hit my bank account that unfortunately it was too far gone at that point. I, after taxes, I received net 28,000. Approximately 3,300 of that was my paycheck. And again, I told them before it hit my account, but they took so long to correct the error and get me my debt repayment letter now. We're now 10 months in the future and, and because it crossed tax year, they're asking for gross repayment, which is requiring me to come up with an extra approximately $23,000 of my own. And I've already been taxed on this because it was taxed in my 2024 tax return as well, which was additional money out of my pocket. They're offering to allow me to repay it in full, which would be the full 48, which net 3,300 of it is mine, that I would have to repay back. And I'm not sure how I'm going to get that back in the future. But they also are giving me an option to deduct 15% from my paycheck until the debt is paid. And I'm not sure what to do. We have the money, so.

[Dave Ramsey]

Wait a minute, let me stop. If I understood you right, you don't owe 48. You owe 48 minus 3,300.

[Ken Coleman]

Well, net gross $4,300.

[Dave Ramsey]

No, I'm talking about that's the gross because the taxes were taken out on this and you should have gotten a ridiculous tax refund this year.

[Ken Coleman]

We did not so because it wasn't corrected, it got charged as income to us.

[Dave Ramsey]

I know. And so the net of taxes, the taxes that were taken out on this should have created a huge tax refund for you.

[Ken Coleman]

We haven't received it yet. I was under the impression we wouldn't get that until we filed next year.

[Dave Ramsey]

It was last year, correct? No. You. You're filing on the extra $48,000. It's not 48. It's 48 minus 33. Correct. 3,300.

[Ken Coleman]

Well, my. My gross paycheck is 5,733 is my net.

[Rachel Cruze]

But you received $28,000 is what you actually got paid.

[Dave Ramsey]

That was the net of taxes. Net of taxes. But there's 23,000 in taxes withheld on it, correct?

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

And you should get that back if it was last year when you file this year's tax returns. Have you not filed taxes for 24 yet?

[Ken Coleman]

That is the tax return that we were taxed on, and we had filed for an extension. But we.

[Dave Ramsey]

You have not filed taxes for 24 yet, is that right?

[Ken Coleman]

Correct. We did, sir. We have filed for 24.

[Dave Ramsey]

Well, you should be getting $23,000 back.

[Ken Coleman]

I. I wasn't. So I don't. I'm not sure how that works.

[Dave Ramsey]

Well, here's how it works. Okay. You paid $23,000 on that one check more in taxes than you should have.

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

And so you don't have taxes on that. So you should get all of that back.

[Ken Coleman]

Immediately in 24.

[Dave Ramsey]

When you file on 24 as a tax refund, when you file, and you have overpaid your taxes, when you file your tax return, you get a tax refund. You know that?

[Ken Coleman]

Yes, sir. We still have that money, though, because they haven't. They. They didn't submit the debt letter to me until last week. So it's been almost 10 years, but.

[Dave Ramsey]

You only got the net. You've only got the 28.

[Ken Coleman]

Correct. It's just sitting there for gross repayment.

[Dave Ramsey]

Yeah, I understand. Okay. Well, number one, you don't pay more than what you actually owe, and what you actually owe is the total amount, including taxes, that they overpaid you. And you should get all of your tax money back from the IRS on that amount without any trouble when you file your tax return. And the other amount, the amount that was net is sitting in your bank account. So you can give them that now, correct?

[Ken Coleman]

Yes.

[Dave Ramsey]

Okay. And then you'll have to repay them the taxes when the tax money comes. You need a tax professional, I think. I don't think you know what you're doing on your taxes.

[Ken Coleman]

Okay, thank you. Do you have. I guess we have an accountant that does our taxes.

[Dave Ramsey]

Yeah, but if he can't tell you, you're getting the. See, if, if there's 48. They overpaid you by 48,000. Is that correct? Total.

[Ken Coleman]

They overpaid me by 43,000.

[Dave Ramsey]

43,000. Okay, I'm sorry. So 43,000. But that netted into your bank account 28,000 too much. Correct.

[Ken Coleman]

Well, if you take out the 3,300 for my. That's how much I received in total.

[Dave Ramsey]

I'm talking about. Just forget what you're due. What I'm trying to get to is the amount that they gave you, that was too much. It was 43. Too much net of taxes. What was that? 43.

[Ken Coleman]

It would be around 20, 24.

[Dave Ramsey]

Yeah, that sounds right. That sounds right. Okay. And so there's another 19 laying out there. You've got around 24 in your bank account right now, Correct?

[Ken Coleman]

Correct.

[Dave Ramsey]

Okay, so you can give them the 24, you owe them the other 19, but the IRS should be giving you the other 19 back because you, you should not have to. You shouldn't be paying taxes on that. So you have to file an amended return and they have to file an amended W2. The company has to file an amended W2 saying you were not due. You know, so that you pay taxes only on your proper amount. And that means that you get the entire refund back on the overpayment. Okay, but if they have not, if they've submitted your income to the IRS as including this overpayment, then that's going to screw the thing up. They need to submit your income as not including this overpayment so you can get all the tax back from the irs. So this is a two check deal. You write them the check for the money you've got and then when you get the money back from the irs, if your CPA doesn't know how to do that, get a new cpa, because this is not rocket science here. And so then, wow, what a weird deal. Oh, man. Yeah. But no, you don't. That $19,000 tax in too much taxes that you have paid should come back to you once they submit the corrected W4, W2 to reflect that you did not get that kind of income in 24.

[Rachel Cruze]

Yeah, a little irritated here at a big company that has all the resources in the world to fix this and they didn't fix it quickly. Hate that for her. But it is. It's fixable.

[Dave Ramsey]

Well, and then they're being like, we're gonna give you options for you to repay this like you did.

[Rachel Cruze]

They're the one that messed up.

[Dave Ramsey]

I've never done one that big. But we have overpaid people. Three or $4,000 or something. And you know what we do? Eat it. Just keep the money. We're so stupid. We did this. We're gonna pay the stupid tax and we're gonna fix it. And somebody in accounting gets their butt chewed. Hello. Wow. Robin is in Iowa. Hey, Robin. Welcome to the Ramsey Show.

[Ken Coleman]

Hi.

[Dave Ramsey]

Hi. What's up?

[Ken Coleman]

So I have. I'm separated from my soon to be ex husband. He took one of our vehicles, I took the other. And he's not been making the payments on his vehicle. So it will be charged off at the end of the month. And I am looking for guidance on do I take this large payment or do I let it hit our credit?

[Dave Ramsey]

You're on it as well?

[Ken Coleman]

I am. We have.

[Dave Ramsey]

Why is he not making the payment?

[Ken Coleman]

He says he cannot afford it and that the car needs to go back.

[Dave Ramsey]

Yeah, well, that's called a repossession. And he's going to get. He's going to get sued and so are you.

[Ken Coleman]

Yes, yes.

[Dave Ramsey]

It's not an inconvenience.

[Ken Coleman]

No, I'm aware of that. And that's where I'm sitting is. Well, I've. I've had the other vehicle, which is broke down, so I'm. I've been saving to try to fix it.

[Dave Ramsey]

His car, the car that he's driving. How. What does it take to bring it current?

[Ken Coleman]

Right now it'd take 2200 to bring it back up to where it is.

[Dave Ramsey]

What is owed on it? Total charge off what's owed on a total 28,000. And what's it worth?

[Ken Coleman]

Probably closer to about 2017 to 20,000 at this point.

[Dave Ramsey]

Okay. And do you have any money?

[Ken Coleman]

Do I have money? I have money that I could get it caught up now.

[Dave Ramsey]

How much money do you have? That's what I'm asking.

[Ken Coleman]

I have about 5,000.

[Dave Ramsey]

That's all the money? That's all the money in the world that you have is $5,000?

[Ken Coleman]

Yes. And I do not have a job currently. I lost my job in May, so.

[Dave Ramsey]

Wow. Okay. And so that in the divorce there's not going to be any things. Is there a home in the divorce?

[Ken Coleman]

No.

[Dave Ramsey]

Okay, so you're just going to split up these dumb debts is all you're going to split up because you don't have any money to split up.

[Ken Coleman]

Pretty much, yeah.

[Dave Ramsey]

Let it go.

[Ken Coleman]

Yeah, just let the Jeep go. And I should just.

[Dave Ramsey]

You can't. You can't afford to catch it up. You can't afford to catch it up. You don't have a job. You have $5,000 to your name. You have to survive. And you're going to have to deal with repo. Your credit's going to get dinged and they're going to come after you and come after him for the deficit. When they do, and it'll probably be close to a year before you hear from them. Be sure you've got some money saved up. And let's pretend that they sell the car. You have 28,000 owed on it and they sell it for 18,000. So there's a $10,000 deficit. I'm just making this up. And they come and they say, you need to pay the $10,000 hole that the car didn't cover. You say, well, that was awarded to my husband in the divorce. Yeah, but you signed on the note. Yeah, I know. So I'll give you $3,000 to let my name go off of it and you chase him for the rest. And that's how you negotiate this. Okay, but get ready for that. That's going to come in about a year and your credit's going to be messed up, but whoop, deep, deep, you got bigger problems than credit messed up. So how's the job hunt going?

[Ken Coleman]

Yeah, I've been putting in about three resumes a day. I haven't limited it to my area per se. I've actually put in for anywhere. Decided? Let the universe decide where I go, I guess.

[Rachel Cruze]

No, no, no, no. So what is your.

[Dave Ramsey]

You don't like the universe?

[Rachel Cruze]

Yeah. I gotta tell you, it's a horrible strategy because people who trust the universe tend to be unemployed for a long time. What is your field of expertise?

[Ken Coleman]

I'm an environmental biologist.

[Dave Ramsey]

Oh, good.

[Rachel Cruze]

Okay.

[Dave Ramsey]

What were you making before?

[Ken Coleman]

66,000.

[Dave Ramsey]

Good.

[Rachel Cruze]

What is an environment? Just give me the quick 10 second version. What does an environmental biologist do?

[Ken Coleman]

Forgive me, my last position, I was doing environmental permitting and compliance work.

[Rachel Cruze]

Private company or government?

[Ken Coleman]

It was a private company.

[Rachel Cruze]

Okay. Okay. There's two things you have to do. Number one, I love that you have got a pretty specific field and you know that world better than Dave and I and I would absolutely be reaching out, connecting in that field and looking for opportunities. But in your current situation, three resumes a day. While I appreciate this and I don't want you to Feel like I'm beating up on you. I'm not. But you might as well be playing the slots or the lottery. Submitting three resumes a day feels like activity and good activity, but it's not. And a resume without a connection is absolutely worthless. So here's what you have to do. There's what I would call a short term, short term strategy and then long term. Like to see you have a long term strategy of getting back in your field or at least leveraging the skill set and experience that you have to maybe cross another industry. And I believe that's transferable. However, right now you're working at Walmart Target. Don't just assume I got to go drive and deliver food, but that. I'm not looking down on that either. But right now you're looking at trying to make 15 to 20 to $22 an hour doing anything. Forget about skill, forget about experience. But you need to get money in the door right now for two reasons. Number one, you have a really tough financial situation and you need money. Secondly, you need momentum. You're going through a divorce and you've been laid off. And, and that is a, that is the equivalent of losing a loved one. We know this from psychology studies and I believe very much in you just staying active, one, for money. But two, keep some momentum. So right now you're taking anything and everything. And we're not sending resumes. We're showing up at these places going, here's what I've done and I can take the night shift at Walmart. I'm overqualified. Yes. But here's my story. And right now people want people that they can trust. You've got character, you've got a good background. But this is an urgency thing, Robin, like right now, yeah, you need, you.

[Dave Ramsey]

Need the, the Walmart job by two of those by the weekend. And we're going to send you a copy of Ken's book called the Proximity Principle, which is what he's referring to, which is get yourself in proximity and get your resumes in proximity to people that work there that, you know, just filling out applications is a complete waste of time in the digital world. We had at Ramsey, we hired 121 people last year. We had over 23,000 applications. The chances of you getting out of that application pile are almost zero. If you didn't have someone that you knew here or something very, very special that you did to set yourself aside. But people just jumping on LinkedIn and whatever other thing that's out there and just ziprecruiter and just filling out bazillion applications and feeling like, well, I can't get a job. Well, it's because you're jumping in a pile of 23,000 for 140 jobs. So you gotta say, hey, my daughter plays soccer, My aunt coaches over here, and she works over there at that company. And hey, would you put in a good word for me? And that's what Ken teach. And that will get you the job or at least get you the interview. The other you won't even get an interview with what you're doing.

[Rachel Cruze]

Exactly right.

[Dave Ramsey]

So, yeah, go get some money short term and then go be looking for the bigger thing and put all this other mess in the rearview mirror. I'm sorry you're going through all this, kiddo. I'd let that car go and deal with it later when. When you're in a much better place to deal with it and you don't have to settle the whole deficit. You just settle your part and let him chase him for his part, since he didn't bother to take care of business here.

[Rachel Cruze]

Two quick things to not just Robin and. But to our large audience who are in a situation like Robin, I want to make sure you hear something first. The reason what Dave is saying is so true and why we're hitting this point is here's what happens when you submit resumes. You feel like you're doing something productive, and then that makes your expectation rise where it should not rise. And then you get ghosted, and then you're spiraling because you've already lost. You've gone through a loss emotionally of losing a job, and now the frustration piles on top and you can quickly get into a really depressive state, and that pauses everything. The second thing, if you're in the position like Robin, Robin needs to take. And Robin, I know you're listening. You need to take your current job description of the job you just lost and get it in front of you and begin to look at it. And if you have to write down what the core skill sets you have that you you exhibited in that last job, then talk about the experience that you have and write that down. And here's what happens, folks that are listening, watching. You can take a job like she has and find crossover experience and skillset that can work in other places, and that'll help you see more. And what that does is it widens your search. And then you use the proximity principle and you begin to say, hey, I have this skill set and this experience while I've been In this field, I can actually go over here and you watch what happens. Opportunities that you never even thought of before begin to present themselves. So hope that helps a lot of people. This is a strategic play and if you do it that way, opportunities show up on your front door.

[Dave Ramsey]

Hey, listen up. Everyone is at risk of identity theft. I don't care if you're a hermit living off the grid, listening to the show on a battery powered radio. All of your data collected by every company you've ever done business with lives online. Your bank, your doctor's office, retailers, the apps on your phone, the gas station where you have loyalty rewards, they all store your info online, making them ripe for a cyber attack or data breach. That's why I've been telling people for almost 25 years they need an ID theft protection plan. And the only one I've ever recommended is from Zander Insurance. They monitor your personal and financial info, even your home title, and take over the work if you become a victim. It's the most thorough and affordable plan out there. I even have it for my family and our entire team. Visit sander.com or call 800-356-4282.

[Ken Coleman]

Sticking to a budget is hard enough. And inflation, George, it isn't helping us.

[Rachel Cruze]

Yep. In fact, 54 of Americans say it's a challenge to save on groceries without sacrificing quality. But Aldi makes it easy.

[Ken Coleman]

Aldi's private label. It is delicious food with incredible prices that you can stay within your budget.

[Rachel Cruze]

Yeah, and Aldi has the lowest prices of any national grocery store, which is really impressive. And with all the money you save, you're going to be making more progress toward your financial goals.

[Ken Coleman]

Yes. Which is what we want for you guys. So stop overpaying and start shopping at Aldi. Find a store near you today at Aldi US That's a L D. I.

[Dave Ramsey]

Dot US Alec is in Canada. Hi Alec. Welcome to the Ramsey Show.

[Ken Coleman]

Hey Dave. Hey Ken. I'm a huge fan of both you guys, so I just want to thank you for taking my call.

[Dave Ramsey]

Thanks.

[Ken Coleman]

So I'm probably going to get in some trouble for asking you guys this, but my question is, how would you feel about me taking out student loans to invest into a guaranteed investment certificate even though my post secondary education is fully paid for?

[Dave Ramsey]

I thought you said you were a huge fan.

[Ken Coleman]

See, I am.

[Rachel Cruze]

I'm. It's the what if, Dave.

[Dave Ramsey]

It's like you just. You're like a huge fan of bears, so you go in the cage and poke them. I mean, what Is the. I don't understand it all.

[Rachel Cruze]

I'm going to see the balance of my time. To the gentleman from Tennessee to my left on this one. I've heard this a time or two.

[Dave Ramsey]

Yeah. How about. No, don't do that. All right, all right. John's in Jackson, Mississippi. Hey, John, how are you?

[Ken Coleman]

I'm doing great. How you doing, Dave?

[Dave Ramsey]

Better than I deserve. What's up? I'm trying to convince my wife, and I think I'm there, that we are.

[Ken Coleman]

In a more or less let the.

[Dave Ramsey]

Good times roll situation.

[Ken Coleman]

The complication being there's a bit of an age gap. I'm 39 and she's 59. Okay, so she's got 250k in a Roth Social Security on the horizon. She'll have a small state pension. She worked 12 years for the state. That's at 65.

[Dave Ramsey]

We've got 77k in a stock market.

[Ken Coleman]

Fund that we just have. I've got my own 160k of retirement savings in accounts. We've got about 50k in savings, just normal savings.

[Dave Ramsey]

And the only thing we owe is.

[Ken Coleman]

Our house at 80K. And it's probably worth about twice that.

[Dave Ramsey]

On a bad day. I would hope so.

[Ken Coleman]

You know, we're not going to have that traditional retirement of each being, you know, like 60 years old. And so in lieu of that, maybe.

[Dave Ramsey]

We could just spend some money and.

[Ken Coleman]

Just have a better life now for the next, you know, 25, 30 years.

[Rachel Cruze]

Hold on a second. Hold on, hold on real quick. How much do you make?

[Ken Coleman]

You're only make about 80.

[Rachel Cruze]

You make 80,000 and you're planning to work until what age?

[Dave Ramsey]

Well, and I don't want to sound.

[Ken Coleman]

Particularly crass, but we're both only children and our parents have what I would.

[Dave Ramsey]

Say is our sizable estates. So when I don't have to work.

[Ken Coleman]

Anymore is what I don't.

[Dave Ramsey]

It's probably about when I'll stop.

[Ken Coleman]

You know, that's. That's about where I am on that. So, you know, 55, 60, somewhere in there.

[Rachel Cruze]

And you're contributing to a 401k?

[Ken Coleman]

Yes, I do matching and then a little extra.

[Dave Ramsey]

And is she working?

[Ken Coleman]

No, she's been like basically retired, seemingly.

[Dave Ramsey]

Retired since she lost her job about five years ago. Okay, all right. So hers is her 250s there, and that's it. So. Well, I don't know what you mean by let the good times roll exactly, but I can tell you what I would do in your situation. I can answer that. Okay. No, you are not financially independent. Not close even. Okay, you're not where you don't have to work anymore and you don't have to worry about money and you're going to sit around like some trust fund baby and wait on the parents to die? No, I'm not going to do that. That's not a high quality life. It's not a life full of dignity, purpose, or anything else. And so I'm going to find something that I do for a living that has some purpose to it that I enjoy and that I can make some money at. And that's what you should be doing with your life until you can't anymore. Not until you don't have to anymore. So I'm 64. My. The building I'm sitting in is worth 600 million and I still work, okay? So that's just this building. And so the, you know, so. And it affords me a very good life. I can do anything I want to do, and I want you to be able to do anything you want to do. But I also don't want you to think that doing nothing is good for you mentally, mental health wise, spiritually or anything else, because it's not. So if I'm in your shoes, I'm taking the 76 out of the stock market and paying off the house today. And I'm going to be putting 15 to 20% of your income into your 401k. And if you want to use, you know, 10 or 15,000 or 20,000 or something out of that 250 of hers and going to cruise or something, if that's let the good times roll, sure, absolutely. But if you're talking about trying to burn through $250,000 of her money just because she hit 59 and a half in the next 24 months, and you call that let the good times roll? No, I'm going to call that irresponsible.

[Ken Coleman]

Not that.

[Dave Ramsey]

I just want to be clear. That's not.

[Ken Coleman]

I'm just talking about like, hey, we go out to the nice restaurant, you.

[Dave Ramsey]

Know, maybe every month versus every third month. Well, yeah, I think you can afford, I think you can afford to do that with what I'm talking about. You don't have a house payment anymore with what I just laid out. And you do a budget, and the budget includes a nice entertainment budget, a nice travel budget, a nice furniture upgrade for her budget, a nice whatever budget. All of that is fine. But it also includes putting 15% of your income away and a plan to work. And, and honestly, I think she would be better off. If she did something, your two only children, she's sitting at home on her butt. I mean, I'm sorry, but is, what is she, is there not something she wants to do? You don't have to work to have meaning. That's not the thing. My wife doesn't work today and hasn't since our first child was born. Doesn't work outside the home, I should say, because she does work. But the. So anyway, I think you guys lay your hand to all of that and you know, but am I signing you up for a 24 hour a day Mardi Gras? No, that's not, that's not, that's unfulfilling. It's not a quality life. It is if you're 18 years old, but it's not for normal grown adults, you know, and so that's what I would do. I would say I systematically be saving, systematically be giving, systematically be enjoying. And you know, if you leave her 250 alone, it'll double every seven years.

[Rachel Cruze]

Yeah. The only thing that sticks out and in no way, Jacob, do I think you're saying this, but I'm just going to throw this out there because I think this is a slippery slope. That when we are waiting on parents to die to inherit this life changing money, I think that's a, I'm going to call it a slippery slope. And I just think we got to be very careful about that because it, that's, that's really tricky. And I'll tell you this as we sit down with our financial advisor, Stacy and I, every January, and they're talking to us, Dave, like, hey, you could live to be 90. Like we're starting to see life expectancy. And so this idea of like, I'm just going to try to scrape along and then hope the parents, you know, kick the bucket. And again, I know you're not saying that, but I do think that that can get into a really weird, tricky mindset. Dave, is what I was feeling there.

[Dave Ramsey]

Our estate plan is set up that if one of our kids does that, they're out of the will. They can't, they don't have that as an option.

[Ken Coleman]

Yeah.

[Rachel Cruze]

To squander and just sit.

[Dave Ramsey]

Sit and wait on me to die. That's not, it's not a plan.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

So I'll take you out of the will and then you'll have a need to work. That'll be good for you. Say, okay, we'll help you fix that. And you know, and so that, that's the way it's set up. And you know, you're not allowed to just sit and wait on us to die because we may live a long time.

[Rachel Cruze]

I think you are. I see you like 99 with a.

[Dave Ramsey]

Cane still on here going, sell the car. Yeah, that's it.

[Rachel Cruze]

Well, you know what's funny about this? The calls will be the same 30 years.

[Dave Ramsey]

Yeah, well, they were 30 years ago, I can tell you that. It's pretty much the same thing. Don't do a student loan. Don't do a credit card debt. Don't borrow on your student loan to invest it in a certificate of savings.

[Rachel Cruze]

I think, I think a lot of people will be here for 94 year old Dave getting irritated.

[Dave Ramsey]

I don't know, man. That's kind of what happens when people old quit making sense and they don't quit. That's not a good thing. We've witnessed that up close lately and I don't think I want that anymore. But yeah, so I'm pretty much ensured that these people over there, the booth people are going to take me off the air is what's going to happen.

[Rachel Cruze]

You, it makes me think of you and I are both friends with the legendary Art. Link letter.

[Dave Ramsey]

Yeah.

[Rachel Cruze]

And Art once said he said this many times, but one of my favorite things he said was his favorite people to ever interview were young people and old people. Young people because they don't know what they're saying and old people because they don't care.

[Dave Ramsey]

You know, I interviewed Art on this show. He was 78 and he did 148 speaking engagements that year. And I said, why in the world are you doing that? He said, because I'm on the Council for the Aging.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

And one of the, some of the data, and this was 20 years ago, some of the data we found is that if you don't keep your brain active, it's a muscle, it atrophies just like any other muscle. And he goes, so I'm doing it just to keep my brain active, just so that I, you know, it's either that or do crossword puzzles. So, you know, I gotta do something to keep the thing moving. Buying or selling a home is a big deal. And with all the clickbait headlines and confusing stuff out there on Tic Tac, it's tough to know what's actually really happening in the real estate world. Hey, we're here to make the latest trends easy to understand. Last month, home prices went up slightly again. Now our median house price is around $440,000 nationally. And we just hit over a million Homes for sale. That's the Highest inventory since 2019. Not enough to meet buyer demand though. Prices are still going up. Average 15 year fixed rate slightly under 6% right now. If you want to learn more about housing market trends and get ready to buy, get the free tools to help you buy or sell with confidence. We'll teach you. We'll help you. It's all free. Go to ramseysolutions.com market or click the link in the show notes. Our question of the day is brought to you by why Refi? Why Refi works with borrowers who have defaulted private student loans even when other lenders have said no. With a lower payment, low fixed rate, you can refi this, get a clear path forward, get out of this debt. Visit y refi.com Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[Rachel Cruze]

Today's question comes from Evan in Washington, D.C. i'm 35 years old, single, with no kids. I make about $350,000 a year. I have a 750,000 net worth and my only debt is my car payment and a $750,000 mortgage. I have 250,000 in my emergency fund and about 250,000 in retirement. The country club I'd like to join has a $20,000 initiation fee and then $500 per month after that. I golf about twice a week. Is it wise for me to make a purchase like this at this point in my life with my financial situation?

[Dave Ramsey]

Yeah, yeah, yeah. You can afford that?

[Rachel Cruze]

Yeah, no question.

[Dave Ramsey]

$250,000 emergency funds. Asinine. Pay off your car today?

[Rachel Cruze]

That's right.

[Dave Ramsey]

Get that emergency fund down to three to six months of expenses and invest that money into some kind of good growth stock mutual fund with your financial planning firm. Yeah, but you can afford a $20,000 initiation fee with those numbers and $500 a month with those numbers. Easily.

[Rachel Cruze]

And if it's a nice place, send an email to Dave and I. We will consider joining you for 18.

[Dave Ramsey]

We'll give it a. Give it a consideration. Consideration.

[Rachel Cruze]

I don't want to speak for David. His busy calendar.

[Dave Ramsey]

Jacob is in West Palm Beach. Hey Jacob. What's up?

[Ken Coleman]

Hey, Uncle Dave. How's it going?

[Dave Ramsey]

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

[Ken Coleman]

Not much. I'm just trying to see if it's a foolish idea for me to purchase a used boat.

[Dave Ramsey]

No, you ought to get it, I guess. I'm kidding. What's the situation? What's it cost?

[Ken Coleman]

Yeah, so they're asking 16,000. I could probably talk them down a little bit from there. I do have 13,000 currently stashed away in cash. I make a salary of $70,000 a year. I am debt free, have no debt. I invest 13% of my income into my 401k. And every year I track and max out my Roth ira, so I don't have really any.

[Dave Ramsey]

Do you have an emergency fund?

[Ken Coleman]

Yes, currently that's just tied up in my money market account, which I could pull at any time.

[Dave Ramsey]

I'm sorry, how much is in your emergency fund?

[Ken Coleman]

$38,000.

[Dave Ramsey]

Okay. All right. And you have 13 saved towards a boat that they're asking 16 for?

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

So if you settle on 14, how are you going to cover it?

[Ken Coleman]

So, well, I just wait another month and keep doing it. Or I could pull out, I guess, from. I have a savings account as well. And then in my check.

[Dave Ramsey]

Okay, I'm sorry, how much is in the savings account?

[Ken Coleman]

Savings account is just 5,000. And then.

[Dave Ramsey]

So you have 38 in an emergency fund, 5 in savings, and 13 in the boat fund. Is that right?

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

Okay. All right.

[Rachel Cruze]

Yeah, I'd offer 13.

[Dave Ramsey]

Yeah, yeah, definitely, but. And see what you can get the boat for. But, yes, you can afford the boat.

[Ken Coleman]

Even, you think? Even with storage, having to pay storage fees. Since I don't have a house, I'm living in a condo, so I'd have to find a place. That'd be roughly 300amonth.

[Dave Ramsey]

If you don't want to, it's okay.

[Ken Coleman]

Oh, okay. Well, I just really wanted to see if you thought I could afford it reasonably with my income and.

[Dave Ramsey]

Yeah, I mean. Well, I mean, what is your. What's your car worth?

[Ken Coleman]

I have a Toyota Tacoma. It's probably worth 30 grand.

[Dave Ramsey]

And you make what, $70,000. Okay. One rule of thumb is not have more than half of your annual income tied up in things with motors and wheels. And you're probably getting ready to break that or pretty close. So that makes it a little bit questionable. You're gonna have a lot tied up because the Tacoma is going down in value like a rock, and so is the boat. So you got a lot tied up and things going the wrong way, but you can do it. But you're just, you know, be aware that you're pushing the edge. No more toys. You ain't got room for toys. And, you know, I don't know what these storage fees are. You need to look at that and see if you can actually afford that part. But the numbers you gave me, you have saved up for the boat. And Ken's right. If you bought it for 13, I think, you know, that puts you right on track.

[Rachel Cruze]

I think he gave us about 300amonth on storage. Dave.

[Dave Ramsey]

He said that? Yeah. I missed it.

[Rachel Cruze]

And so with that, he needs to look at his budget and go, how much does that taxes his other operating?

[Dave Ramsey]

30, 600 bucks a year.

[Rachel Cruze]

Yeah. So, you know, it's doable based on the numbers he gave us. Is it the best decision? Not on the rule of thumb.

[Dave Ramsey]

You're on the top side of everything here. You don't. You're not on the bottom side. It's not a slam dunk like the country club guy. But the.

[Rachel Cruze]

What's a boat like that gonna depreciate? Is there a rate?

[Dave Ramsey]

They all go down like. Like crazy quickly. Anything. Anything does. I mean, there's no such thing. Anything with a motor, it just. Or with wheels, you know, if it's got a battery and wheels like Rachel's car, you know, it goes down. So those. It doesn't matter if it's got them up. But you know, I'm saying it just. They just all go. They're all. It's just a. Or a black hole for money. I will tell you this. The. The. The. The joke is always there's two best days in a boat owner's life. The day they buy it and the day they sell it. Is that true? Well, I don't know. I've never sold one other than to buy another one. So I've always. I've had a boat my whole life.

[Rachel Cruze]

Isn't that really. Okay, so this is fun question.

[Dave Ramsey]

If you. If you reach the end of your use of a boat and you're sick and tired of it and it's. It's a bother.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

Then it's a great thing. You like anything. You have a little celebration when you finally get stupid things.

[Rachel Cruze]

You have so much financial margin and freedom that there's. My point is, I don't know if that's true for someone who's in good financial situation.

[Dave Ramsey]

Yeah. But I mean, emotionally, the thing could just be in the way if you're done. Oh, I'm done with it. I don't. I don't want this thing anymore, whatever it is. You've yet to reach this moment on a boat. Yeah, no, I. I've got. I like both. I've got mastercrafts and we're skiers and so.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

And wakeboarders and surfers and all that stuff. Barefooters, all that. We do all this Stuff. And so, yeah, we love our Mastercrafts. They're world's. World's best ski boat as far as I'm concerned. I'll just give them an ad right here.

[Rachel Cruze]

There you go.

[Dave Ramsey]

There we go. Give them a mention. Yeah, that's. But that was when I was a kid and we were skiing and beginning to ski tournaments and stuff in my teenage years. If you had a Mastercraft, you were. You were, you know, you were the dog status of. You were the big. Was the best boat. I mean, because it's. When you're slalom skiing in those days, today, if you got a 190, it's. It's a zero wake and it get you out of the water so fast, it's unbelievable. You're not dragging around back there and drowning and everything else. And so it's just. And so that's what I always wanted. It became a goal. I mean, like I was a teenager. I'm back there going, someday I'm gonna get some money.

[Rachel Cruze]

Sure.

[Dave Ramsey]

What am I gonna get? Some people wanted to get a car. Some people wanted to get a Tacoma. Dave wanted to get a Mastercraft. So that was. That was the thing. So it's a little different for me, but, yeah, make sure you're gonna use a stupid thing. And because you're gonna be. You're going to be putting up a fair chunk of your life into it, sir. And so make sure you're getting good use of it. Toys are not against the rules. The only rules we have are rules that cause you to become wealthier so that you can enjoy your life more. That's the only rules we have. And when you make $50,000 a year and you have a $50,000 truck payment, and you have a boat and two sea dues, and you wonder why you're broke. I can show you. It's in your driveway. That's why you're broke. You wonder why your kid's college fund isn't funded. It's in your driveway because you're buying a bunch of crap. You can't afford to impress somebody at a stoplight that don't even know you. And so. Oh, cool truck. Yeah, well, that's about what you get for 70 grand. So, no, no, you don't put money and stuff like that. And you live like no one else. You drive like no one else so that later you can live like no one else and drive like no one else. The reason we can afford those Mastercrafts is because we didn't for a long time, and we saved and invested and saved and invested. Just like we teach here on the air. So you live like no one else. So later you can live and give like no one else.

[Rachel Cruze]

Speaking of, I, along with the other personalities, have been at the other end of you, giving us a wonderful time, dragging us on the back of that boat. And you have thrown me in places.

[Dave Ramsey]

Such a joy.

[Rachel Cruze]

My body is contorted in places.

[Dave Ramsey]

And smack the water to launch kin.

[Rachel Cruze]

At a high rate of speed.

[Dave Ramsey]

Launch him on a tube. Can you just see Ken flying through.

[Rachel Cruze]

The air everywhere terror until you land in the water. Blisters.

[Dave Ramsey]

Great.

[Rachel Cruze]

No skin on my knees.

[Dave Ramsey]

Great tube.

[Rachel Cruze]

Dave gives like no one else, folks.

[Dave Ramsey]

I'm telling you, man. That's right, he does. I'm generous that way.

[Ken Coleman]

Switching banks can be a hassle, and I totally get that. But when Winston and I opened up our Fairwinds account, we were shocked by how quick and easy it was. It just took a few minutes online. We didn't have to block off an entire afternoon or track down paperwork. And the next day, we got a personal call from a Fair Wind specialist just checking in. I couldn't believe it. When I answered my phone and I was talking to them, I was like, y' all are the nicest people. Now, if you're working hard to save money, get out of debt, and build a future, you should have a bank that supports that, that, not fights it. That's why I recommend Fairwinds. They created these smart checking and savings bundles specifically for Ramsey fans. Plus, they have a great app. And you have access to over 33,000 fee free ATMs and more than 5,000 shared credit union branches across the country. So you can have access and withdraw your money just like you're used to. No matter where you live, don't settle for a bank that slows down your progress. Make sure you choose one that helps build you up and helps you win with money. Visit Fairwinds.org Ramsey and open your smart bundle today. Fairwinds.org Ramsey Fairwinds.org Ramsey FairWinds is federally insured by the NCUA.

[Dave Ramsey]

Lisa is in Fort Wayne, Indiana. Hi, Lisa. Welcome to the Ramsey Show.

[Ken Coleman]

Hello.

[Dave Ramsey]

Hi. What's up?

[Ken Coleman]

So my husband and I both work. We are doing everything right, financially, at least according to everything I've read and seen and done. But he still insists that we can't afford a baby. And I wanted nothing more forever. And I just don't see how his math is working. I just don't see how he can think that when we're Doing so well. And I look at.

[Dave Ramsey]

Do you have debt?

[Ken Coleman]

I mean, technically, you know, we have a car that we're almost done paying off. It's got, I think, like $900 left to pay off. And we bought a house about a year ago.

[Dave Ramsey]

How much is your house payment?

[Ken Coleman]

I know we pay 2400amonth. I think it's just under, but we like to round it up.

[Dave Ramsey]

Okay. All right.

[Ken Coleman]

And then I do have student loans.

[Dave Ramsey]

How much are your student loans?

[Ken Coleman]

About 40,000. They keep going up because I'm on an income based repayment plan, and I've been.

[Dave Ramsey]

So you're not. You're not paying off your student loans, so they're going up. Okay.

[Ken Coleman]

And I've been working towards the public service loan forgiveness program.

[Dave Ramsey]

No, that doesn't work. You got to pay off the student loan. 1% of the people survive the public service program. It's a complete scam. So what's your household income?

[Ken Coleman]

He makes 70,000 ish. I don't know what my yearly salary is because I changed dogs about a year ago, but I make about 20 an hour.

[Dave Ramsey]

Okay. Which is about 30. So you make about $100,000 a year. All right. And your vision of having a baby involves you quitting work?

[Ken Coleman]

Most likely Only because I do have a disability. And we think that once I have a baby, I'll probably have to go on disability, but we're not sure. We're trying to figure that out.

[Dave Ramsey]

So having a child will aggravate your disability and make it worse?

[Ken Coleman]

Yes and no. I don't know if you've ever heard of EDS or pots. It's essentially a connective tissue disorder. So I'll be in and out of to make sure everything's good. I'll be, you know, in the. Not in the hospital a lot, in the. Outpatient a lot. I'll be going to the doctor quite a bit. And then just because it's a connective tissue disorder where everything's loose, pregnancy makes everything looser. So there'll be a period of time where I'll be in kind of recovery, getting everything to tighten back up so that I can function as normal again.

[Dave Ramsey]

Okay. And all of that, of course, involves medical bills.

[Ken Coleman]

Yes. We've got pretty good insurance, so I'm not super worried about those part of it. My.

[Dave Ramsey]

Is he really worried about the money? Is he worried about you?

[Ken Coleman]

It's both. I mean, I know it's both. He's. He said as much, but he's. We're both pretty confident that because I've got a really good team of doctors. A lot of my disability is, I don't want to say in remission because it never goes away. But, like, it's. I'm pretty well managed for what I have. Yeah.

[Rachel Cruze]

Have you two sat down and gone line by line through the budget? Because the way you led the question off, you know, you basically said, I don't think his numbers are matching what I'm seeing. And so I'm curious, have you gone line by line through your budget based on you losing $30,000?

[Dave Ramsey]

What expense is it that he thinks is going to break you all?

[Ken Coleman]

Yeah, so we've gone line by line. The reason I think that it's coming across different is because, for example, he likes to have like a minimum $2,000 buffer in our. In our checking account every month. We have an over $10,000 emergency expense in a share certificate, plus our regular savings for, like, saving up for things. He wants to have all of the funds saved up for, you know, me being out on medical and initial baby expenses. He wants to have that all saved up beforehand. And I grew up in poverty, and I'm sitting here, he's got 17.5k in investment accounts. You know, we've got all this money stashed away places, and he just doesn't like to touch it because he wants to have it. Just in case he wants to have.

[Dave Ramsey]

Well, he's trying to make sure he takes care of a wife who's going to struggle medically and a baby. You know, I think this guy's loving you. Well, the way he knows how to love is to have some money to make sure that the family is okay. So his motivation is really pure. He's not, you know, you didn't tell me he's got a million dollars. You told me he's got 17,000. Thousand. It's not like you've got stack cash stacked in the spare bedroom to the walls. Okay, it's 17 grand. So I have a quick question.

[Rachel Cruze]

Has he revealed to you an amount of money that if you were to get to that, then he would feel comfortable?

[Ken Coleman]

Sort of. He had. He tasked me with coming up with a number of. Like, when we have a bait, you know, if you're not the one, how much do we need?

[Dave Ramsey]

Yeah, you're not the one that needs a number. He's the one that does.

[Rachel Cruze]

He needs to come up with a number.

[Ken Coleman]

Right. He. The reason he asked me to do it is because he's like, I don't really know what it's gonna cost for us to have a baby. So. And I don't know how much your work is gonna let you have, so.

[Dave Ramsey]

Plus.

[Rachel Cruze]

So give him what he doesn't know and then put pressure on him in a positive way.

[Dave Ramsey]

I think you. The answer to your question is I think you guys can afford to have a baby. But I think the way you're gonna get on the same page about this is that the two of you lay out a game plan, because your husband is a planner. He is a nerd. He's a wonderful husband, but he's a nerd. And he is going to be fretting and worried about his wife and his child, and it's going to offset some of the joy of having a child if there's not a plan. So the two of you sit down and work your way through a plan and what exactly those dollars are. Reallocate some of the dollars you've got and put some new dollars towards it. Get the questions answered about what it's going to cost, the questions answered about what time you're going to be off, questions answered whether you're going to quit and what disability is going to look like. All of those things. Get all of that laid out, and that shouldn't take. You could do all of this in less than a month and figure out the plan, and then it might take you a couple months to fill in the gaps with the cash to do the plan. But one of the plans needs to be, you know, after you. After you do this, after you have a baby, you got to have a plan to get this stupid student loan paid off, because your plan that you have right now sucks. It's horrible. You're going to be in debt the rest of your life with the plan you've got right now. So that's a side issue. But you guys have got to start laying that stuff out and go, okay, we're going to get rid of all these debts. The last little bit on the car. We're going to actually start paying off the student loans after the baby comes. And I'm fine with that. We never tell people, I mean, virtually never. To avoid children based on cost. We always say, have babies. The best thing in life is babies. Babies are awesome. They're the best thing out there. And the only thing better than babies is grandbabies. Yeah, that's the only thing better. So get you some. But he's laid out what makes him feel like a good dad and a good husband. So help him get there. And when you do that, I think all of a sudden Baby's gonna be back in the discussion. We know a bunch of you have been trying to get your friends and family on the Ramsey plan. And it's hard to get them to understand all this stuff. So we're gonna help you. We built the Ramsey 101, the first level class that you can take. It's a playlist and you can help them completely for free. It's an easy to share playlist. It covers the basics for someone who's just getting started with Ramsey. What are the baby steps? How to pay off debt using the debt snowball. How to build an emergency fund. How to get the spous. Click the link in the top of the show notes and open Ramsey 101 playlist on YouTube. Text it DM it, send it to a group chat. Say something like, just thought this might help. Not like, you're stupid. Don't do that. If you're listening on radio, we've got the playlist featured at the top of our YouTube channel. One share, one step could change everything for one person. Aaron is in Jacksonville, Florida. Hi, Aaron, how are you?

[Ken Coleman]

Good, how are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

So me and my dad, we run a painting business here in Florida. And the plan from the start was.

[Dave Ramsey]

Always for me to take it over.

[Ken Coleman]

I'm 26 years old. He's about 60 years old now, but he also pastors a church here in Florida. And so the plan has always been for me to start and take over the business. He's going to hand it off to me. He's going to retire. But the last six or seven years now, he's been doing just like shady things. As I get older, I'm realizing the things that he does are just not ethical. And me and my wife are just getting to the point of like, should I move on? Should I just take over the business and hopefully it all will just work out. But the shady things he does are just like taking payments from customers to his own personal Venmo account and sometimes even to his own bank account and sometimes won't even tell me. If I bring it up to him, he'll just blow it off, say it's just, just, it's our account. This Venmo is our account. If you need anything, we'll pull it out of there. And I can't get him to put it into our joint account through Fairwinds. So the, the big question is if.

[Dave Ramsey]

I should move on. So wait a minute. Are you one of the owners now?

[Ken Coleman]

Yeah, I'm the VP of the company?

[Dave Ramsey]

Yeah. And you're one of the owners.

[Ken Coleman]

Yes.

[Dave Ramsey]

Okay. And so he's taking money that is your money.

[Ken Coleman]

Yeah, Our company.

[Dave Ramsey]

Me.

[Ken Coleman]

Our painting company.

[Dave Ramsey]

Yeah, I know, but he took it and put it in his personal account. Which half of that money was yours or some. Some portion of that money's yours, right?

[Ken Coleman]

Yeah.

[Dave Ramsey]

Not like if I need it, it's like mine. Whether I need it or not, it's mine.

[Ken Coleman]

Yeah.

[Dave Ramsey]

Is that what you're saying? Yeah, he.

[Ken Coleman]

It's a. Yeah, it's his personal Venmo count. So it's not really my money. It's basically.

[Dave Ramsey]

I don't think he sees it as shady. I think he just really sucks at bookkeeping.

[Ken Coleman]

Yeah.

[Dave Ramsey]

It's irrelevant to him which account it goes in because it's his money as far as he's concerned. And he left out the part where he was ripping you off. Right. He doesn't. I don't think he even realizes it, does he?

[Ken Coleman]

No, he'll deflect it and just try to blow it under the rug.

[Dave Ramsey]

That's not what I mean. I don't think he realizes he's stealing from you. That's why he deflects it. As far as he's concerned, it's my money. If I put it in this account, if I put it in that account, it's still my money. But that's not true, because you're one of the owners. You get paid out of the profits. Right. And so this affects profits.

[Ken Coleman]

Yeah, 100%.

[Dave Ramsey]

Yeah. So you've had a discussion that was that blunt? I don't think so. You don't sound like that guy.

[Ken Coleman]

I have a couple of times. And he just says, what's the big deal?

[Dave Ramsey]

What do you. What do you want to do? I'm like, can we. Big deal is I want you to put the freaking money. That's my money in this account. That's ours. That's the big deal. But it doesn't sound like that coming from you. It would from me.

[Rachel Cruze]

Yeah. This is a clear cut for me. I think. I think you need to move on. I don't think he's going to change. And it feels like to me, you already resent him, and this is just a mess. And I don't see him getting out of this deal anytime soon either. So then it comes down to if he's not going to change, how much longer are you willing to put up with this? And I don't think you're going to like any of those answers. So if it were me, I Would say, dad, love you. I want out.

[Dave Ramsey]

I'm willing to stay if you transfer all of it to me within three months. If you're not willing to do that, I think I need to go out on my own. I just. I think this thing's run its course. Yeah.

[Ken Coleman]

Yeah.

[Dave Ramsey]

What do you do that. Will he turn it over to you now?

[Ken Coleman]

I don't think so.

[Dave Ramsey]

I think he needs the income.

[Ken Coleman]

He's a pastor, but it doesn't support his.

[Rachel Cruze]

Yeah, he's bivocational. This is a slush fund for him. This also has tax implications that I would not sleep well at night. I've never been a fan of people doing that and treating their business like it's a personal account. A lot of small business people do this and that's dangerous. And the IRS loves to weaponize and make an example out of people. And I'm not saying that's going to happen, but for all those reasons. Dave, you're being very generous here. I wouldn't even give him the. I'd just be done. I don't think I'd give him an ultimatum because I don't think it's going to matter and I think it prolongs your decision.

[Dave Ramsey]

Well, what it does do is it gives dad the choice fair. You let him have the dignity of choice and you can choose. Dad, I'm through working together. This, you putting money aside and other things I'm not okay with and the other stuff you're doing, I'm not okay with. I love you. I want to continue to be your son, but I can't work here anymore. If you want to turn this over to me, fine. If not, I'm going to go out on my own. And you know, it just sounds like that. Yeah. Yeah. There's no reason to burn the bridge and no reason to burn the relationship. It doesn't. And so don't be yelling and calling him a crook and running out the door or something that does. It's not. That's not valuable. There's no, no need to do all that. So, man, I'm sorry. That's a hard situation to be in. Dave is in Chattanooga. Hi, Dave. Welcome to the Ramsey Show.

[Ken Coleman]

Hey guys. Thanks to my call, I am looking at long term care insurance and I see several. A couple different options out there. One, this is something I should be looking at is that. That's one question. And number two, what should I be looking for? And basically what I'm looking at, I'm just trying to understand the numbers and what makes sense.

[Dave Ramsey]

Okay. How old are you?

[Ken Coleman]

48.

[Dave Ramsey]

You don't need long term care insurance.

[Ken Coleman]

Okay?

[Dave Ramsey]

The statistical use of nursing home stay prior to age 60 is very, very close to zero. And so I would not. We don't recommend long term care insurance until you turn 60. And then the reason you would do it is this. If you have a mid range net worth, meaning let's say you've got 500 or $700,000, 57 or well, I'm sorry, 75% of the ladies outlive their husbands. So the normal scenario is 64, 65 years old, whatever, 69 years old, dad gets something and goes into the nursing home, stays three years, burns through 350 grand, cracks and scrambles a nest egg, leaves mom broke when he dies. That's who needs nursing home insurance, long term care insurance. You also, when you're buying that at 60 years old or older, want to buy an in home care feature that it will insure someone to do in home care as well as a traditional nursing home. None of it covers more than three years. Now you can't hardly find it. It's all a three year policy. But the statistical, again the stats are the average nursing home stays about 2.7 years. And so very few people go over three years. It's very, very unusual. And so if you do, you can get into some other messes but you can't get coverage for more than three years hardly these days. So basically nursing homes, 100 grand. So you're buying 300k worth of coverage costs you about five grand, four grand, something like that. And per year and you know that that gets you set up. Now if you're worth $10 million, you don't need long term care insurance. You hire full time help and turn your home into a nursing home or you write a check and self insurer if someone does need to go into memory care or something like that and you just write the check and you're better off to self insure through it because again your exposure is about $300,000. That's about what the average out of pocket is going to be. And you can absorb that if you have $10 million. But we strongly recommend mid range and down to no money, under a million dollar net worth, down to no money that you get long term care insurance once you turn 60. It is a major deal. It's a big hole in people's thing and I see a lot of, a lot of widows left with no money because daddy used up the money in the nursing home and they had a pretty Good little nest egg. A couple hundred grand or four hundred grand or something and it just gets cracked and scrambled. Let's be honest. Shopping for health insurance can be confusing with high costs, complicated terms and customer service that doesn't really serve you. You. Most folks just pick a plan and hope for the best. See, insurance companies don't work for you. They work for themselves. Meaning they love it when you overpay. So you need a guide on your team to help you make the best choices. Health Trust Financial works for you. They're not salespeople. They help you find the health insurance option that makes sense and saves you money. The fact is, health insurance is one of the biggest expenses in your budget. But most people who work with Health Trust Financial end up saving $500 a month. Imagine putting that kind of money toward the baby steps. My team has worked with them for over 20 years and they've served thousands of people just like you. They're the only health insurance broker that's Ramsey, trusted to help you. So stop throwing money away and get the health insurance that's right for [e-mail] that's healthtrustfinancial.com these days, business as usual is anything but. Tariffs make trade policy a moving target. Supply chains are squeezed and cash flow is probably tighter than ever. So if your business can't adapt in real time, you're in a world of hurt. That's why you need NetSuite by Oracle, trusted by more than 41,000 businesses, including Ramsey Solutions. You need to see what's happening, what's stuck and what's costing you and how to fix it. And NetSuite is the number one cloud based business management suite because it helps your business make the right decisions fast. It brings accounting, financial management, inventory and HR into one place so you're not left shuffling a dozen different spreadsheets. That gives you the visibility you need to make quick decisions based on actionable data. And NetSuite AI automates everyday tasks so your team can focus on strategy. It's one system for full control and no guesswork to tame the chaos. And right now, if you're leading a business doing more than a million dollars in annual revenue, download Netsuite's free ebook navigating global trade. Three insights for [e-mail] Ramsey that's NetSuite. Vanessa's in Detroit. Hi Vanessa. Welcome to the Ramsey Show.

[Ken Coleman]

Hi. Good afternoon guys. Thank you so much for taking my call. Sure.

[Dave Ramsey]

What's up?

[Ken Coleman]

Okay, so I have received a 30k buyout from my former employer. I have an $18,000 car loan left to pay off. I have $5,000 in medical bills. I'm just wondering what actionable steps can I do to set myself up in the future for.

[Dave Ramsey]

Got the new job?

[Ken Coleman]

No.

[Dave Ramsey]

What were you making before?

[Ken Coleman]

Before I was making like 50k a year.

[Dave Ramsey]

Okay. And when will you start the new job? Making 50k.

[Ken Coleman]

That is something. I'm not sure that's. It's a lot of wants that I want to do. I want to start a new business, I want to invest, I want to go to school, I want to go to college for.

[Dave Ramsey]

No, you need to get a job.

[Ken Coleman]

I'll get a job.

[Dave Ramsey]

Yesterday. Yesterday.

[Rachel Cruze]

All of those want to's.

[Dave Ramsey]

You don't have enough money to do all that. You only got 30k. You didn't get 3 million.

[Rachel Cruze]

Yeah.

[Ken Coleman]

Okay. Okay, well, that is.

[Dave Ramsey]

Let me help you with this. If you get a job this week making 50k, the 30k is free money and you can use it to pay off your debts. And it would be debt free. Making 50k, you'd be in a lot better position than you were four months ago. Before the. Before the voluntary buyout. Right?

[Ken Coleman]

Yes.

[Dave Ramsey]

And then you can take. Since you don't have any payments now, you can start saving up money to go to school, saving up money to start a business.

[Ken Coleman]

Instead of just pouring out what I have now and then. That would just be a risk.

[Dave Ramsey]

Well, the problem is you don't have anything to eat with. Honey, when you pour out the 30k, there's nothing left you don't have any money to eat with.

[Ken Coleman]

Right? Right.

[Dave Ramsey]

You gotta have food. Yeah. Yeah. You need to go get a job. Yesterday. When did all this go down?

[Ken Coleman]

This has been an ongoing situation since last year.

[Dave Ramsey]

Now, when did you get the check? When were you. When they cut you loose?

[Ken Coleman]

Like. Like three days ago.

[Dave Ramsey]

Oh, good. Okay, good. So it's fairly fresh.

[Rachel Cruze]

What were you doing?

[Ken Coleman]

I was a automotive worker at one of the plants and they were basically very. They wasn't consistent. So I could have stayed. I think my race would have been like 36. But because of the inconsistency, one day if you working once. Some days we not. It just. It wasn't guaranteed.

[Rachel Cruze]

Gotcha. I'm sorry, what did you say you were doing? Automotive. What.

[Dave Ramsey]

What worker? She's in Detroit.

[Ken Coleman]

Yeah, I was. Yeah.

[Rachel Cruze]

Oh, you're okay. You're on the assembly line, like putting cars together?

[Ken Coleman]

We were the. The plant that sent the parts to.

[Rachel Cruze]

Okay, so. So you know a lot of people in that industry, I'm guessing.

[Ken Coleman]

Not really. I just kind of stayed to myself and worked and went home.

[Rachel Cruze]

Okay. Again, Dave said it and he's right. You, the best way for you to come out of this thing unscathed is you've got to get employed quickly. And you know enough people, you've got enough experience, you're looking at anywhere in the Detroit area. You got to get back to work quickly.

[Dave Ramsey]

Vanessa, I'm not trying to be tacky, but I don't want you to think $30,000 is a lot of money because you're going to find out how quickly it's going to go away if you don't get back to work. It's not much money. You did not get much of a buy out here, and so you didn't hit the lottery. I know it may be more money than you've seen in one check. I understand that. And I'm not trying to be talking down to you or something, but the way you're acting and emotionally is, is that this is a lot more money than it is and you really don't have. You really have a pretty serious problem. You're unemployed, and you need to get that problem solved as fast as possible. Hang on. We'll send you a copy of Ken's book Proximity Principle, which will help you with that process. Candace is in Washington, D.C. hey, Candace, how are you?

[Ken Coleman]

You? I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

Hi. Okay, so my husband and I are, we have done all your steps. We are debt free. We have money in our emergency account, and now we are in the thinking of investing stage and investing in like, the stock market scares us, like, because it's not a world we know nothing of anything about. So my husband wants to invest in precious metals like gold, and I want to invest in a, like a beachfront property or a lake we can use as a rental. So my question is, what do you.

[Dave Ramsey]

Think is the better investment at your stage? Neither one.

[Ken Coleman]

Okay.

[Dave Ramsey]

Right now you need to just be doing your 401ks and Roth IRAs and some good growth stock mutual funds. And I know you said the, the stock market scares you and it scares you not because it's scary, but because you just don't know anything. So it's time to get into. It's time to learn and start learning a little bit about how a mutual fund works. What a mutual fund is, is multiple people put money in it. That way they mutually fund it. That's where the name comes from and what the Fund buys tells you what kind of mutual fund it is. If they buy growth stocks with the money that people have mutually funded, then it's a growth stock mutual fund. And you hear people say that phrase a lot, I'm sure. And that's what we teach people. And what I personally have put Ken's personally put our families have put our retirement into mutual funds. And a mutual fund is 90 to 200 different stocks of America's best and brightest companies. And so when you open up your mutual fund information brochure, you're going to see companies like Exxon or Apple or Home Depot or Coca Cola or McDonald's or something like that. And you're going to go, oh, 20 years from now, this group of stocks is going to be worth a lot more than it is today. Because for the last hundred years or so, the stock market has averaged a little over 11% per year in those group of stocks going up in value. And so that's what I would do. I'd put my. If you're out of debt, you got your emergency fund. I start putting 15% of my income into 401ks and Roth IRAs and good growth stock mutual funds. I sit down with a smartvestor pro. You can find one that we [e-mail] we're not in the investment business, but these are the people that will help you do that and have the heart of a teacher. And they'll finish teaching you the lesson that I just started teaching you. Gold absolutely sucks. You're gonna really screw up putting your money in gold. Your husband doesn't know anything about that either or he wouldn't be suggesting it. Gold has a horrible track record. Over the last 70 years, gold has an average annual return of 2%. You'd be better off putting your money in a freaking fruit jar. So no, just because you've been watching too much reading too much crap on the Internet, if you think gold is a good investment, no, it's not an investment. It's a good way to lose your butt. And so no, you don't need to do that, and no, you don't need a beachfront rental that you're gonna borrow money to go do. You just got out of debt. So no, you're gonna be putting 15% of your income aside in good growth stock mutual funds. And that is the shortest direction to your first million to $5 million in net worth.

[Rachel Cruze]

I think that advice is a little fuzzy, Dave. I think you should clarify that a little bit. Just as a casual observer.

[Dave Ramsey]

Could you.

[Rachel Cruze]

Be any more clear? I don't think that's possible.

[Dave Ramsey]

You know, I think it's fun to remember that when you're investing, when you do anything that's new, there's two kinds of fear. There's fear that is good for you. Don't touch a hot stove. Don't stand in front of an 18 wheeler that's coming at you at 80 miles an hour. That's fear that keeps you from getting hurt. Right? You need good fear. The other fear is fear of something I don't know how to do, but it's false evidence appearing real. F E A R and that's you holding the seat of your 5 year old while they learn to balance a bicycle for the first time. In their minds, they're getting ready to die. In your mind, they're going to be balancing and giggling within the next hour and they will probably scrape a knee in the interim and they will not die from it. Instead, they will have a life of freedom because they can now pedal and balance and learn something that they didn't know before. That's a good fear that you work your way through with knowledge and with practice. And that's investing. And that's investing in the stock market. The stock market is not scary at all. It's not unstable. And it's not even that risky when you learn how to do it properly. Like we're talking about not buying single stocks, we're not day trading, not doing some stupid butt thing you heard on TikTok or just putting money in your 401k baby. It's kind of boring. Well, graduation does not come with a gps. A lot of students are walking into the real world with what's known as no clue. The get clear assessment. Find the work you're wired to do. Student Edition is here. You get clarity and you build a real plan that they're confident in, whether it's a major, a trade, or their first job. $34.99. The assessment will help them identify their strengths, while the book will help them understand the results and figure out what's next. Fabulous for graduates. Get a copy [e-mail] store. If you're watching on YouTube or podcast, click the old link in the description. Noah in Seattle. How are you, Noah?

[Ken Coleman]

I'm good. How are you doing?

[Dave Ramsey]

Better than I deserve. How can I help?

[Ken Coleman]

Hey, so I'll jump into it really quick. Sorry. This is super surreal talking to you. So me and my wife got married about a year and a half ago and before that two years before we got married she got into a car accident and she didn't have active car insurance.

[Dave Ramsey]

Oh.

[Ken Coleman]

And so she has a judgment which is $80,000. About 83,000 to be exact. And we didn't know about this judgment until six months into our marriage. Like there was nothing on a record. There was nothing.

[Dave Ramsey]

Oh no, no, wait a minute. She knew, she got sued.

[Ken Coleman]

She, she had moved and she had, so she hadn't gotten any papers or anything. She wasn't served at all. So six months into our, our marriage we got a paper saying we have this judgment, we had to pay it.

[Dave Ramsey]

And it's to an insurance company, I assume.

[Ken Coleman]

Yeah.

[Dave Ramsey]

Who is the insurance company?

[Ken Coleman]

It's through a, like a processing, like I want to say collections. But collections isn't what it is.

[Dave Ramsey]

No, but I mean there's, there's a judgment probably with the people she hit. It's their insurance paid the bill and then they came after her.

[Ken Coleman]

Yeah, correct, correct.

[Dave Ramsey]

So who was the insurance company, do you know?

[Ken Coleman]

I'm not sure I can look at the paper.

[Dave Ramsey]

How old is your wife?

[Ken Coleman]

She's 21 now. She was 18 when it happened.

[Dave Ramsey]

Okay, so she just had no clue.

[Ken Coleman]

Yeah.

[Dave Ramsey]

Okay. And you guys are. She's 21 and you're what?

[Ken Coleman]

20.

[Dave Ramsey]

And what's your household income today, hun?

[Ken Coleman]

75,000.

[Dave Ramsey]

Okay. And I'm assuming you don't have piles of money anywhere?

[Ken Coleman]

No, we're on baby step two and I just wanted to know this was our biggest and last debt to work on and I just wanted to know.

[Dave Ramsey]

If your best route is. I would take a run at it myself. I think if not, I would probably spend a thousand dollars on an attorney and let them take a run at it. And your best route is to try to do a lump sum settlement and try to get this insurance company to say, okay, I got a 21 year old kid, just got married, she's got no money, you ain't getting nothing. Yeah, good luck with your $80,000 judgment. And this is how the conversation sounds. I mean once they get a clear picture that this is a, this is not a multimillionaire that they have sued, this is a broke person that has no money, that's brand new, married and 21 years old. Okay. Once they get that picture in their head, they're going to soften up quite a bit. You follow me? Because they don't think they're going to get their money. Once they understand what they're dealing with, they don't think they're going to get their money. And that's what I want them to think. I want them to think they're not going to get their money and then all from, you know, 20,000 bucks to settle the whole thing and then just go borrow that. Okay, I would rather you have $20,000 on a credit card than $80,000 to a car insurance company.

[Ken Coleman]

Okay. My father in law said that what we should do is do bankruptcy, but I don't like that.

[Dave Ramsey]

Absolutely not. You're not bankrupt. Okay, that's dumb. No. Okay, you know, where was he, where was this genius when all this was going on? Why don't he take care of his daughter and find out what the flip's going on? So. No, he doesn't. We don't need his advice. I promise you. He means well, but he doesn't have a clue how this works. So I think, how confident are you that you can walk into this phone call with this lawyer on the other side with a bit of a swagger and do this deal? Or do you need to hire an attorney to do it for you?

[Ken Coleman]

I'm pretty sure I could do it. I'm. I could do it.

[Dave Ramsey]

Okay, well, you understand you're going to paint the picture of you married this girl. You're not liable. Okay? Under no circumstances. You know, so you can't get money from me. And I don't have any either. And I just married her. She's 21, she's got no money.

[Ken Coleman]

Yeah.

[Dave Ramsey]

And she was 18 when this happened. And she had no money. That's why she didn't have any stinking car insurance. And so I've talked to the bank. The bank will loan us $20,000 on a credit card. If you'll take that as settlement in full, I'll give it to you. We'll take that and then take payments. No, we won't do that. The only thing I'll do with you is a lump sum. I want you out of my life. And then you just begin to negotiate and find out the number and then see if you can borrow that much money because you can cut this at least in half. And I don't mind you borrowing because you're already in debt.

[Ken Coleman]

Debt.

[Dave Ramsey]

We're just changing the name of the debt from 80,000 car insurance to 20 or $30,000 credit union loan or whatever it is. Right? We're reducing the total debt by this maneuver. And then you got that item and your debt snowball and you make 75,000 a year and you go knock it out. Okay, but you're not bankrupt. And so don't do that. You could threaten that. If you want to threaten that, just go. Well, my father in law told me to file bankruptcy, but I thought I'd call you guys and see if we could work some out. You know, that's kind of. You follow the swagger here, right?

[Ken Coleman]

Yeah.

[Dave Ramsey]

And if you feel like you're out of sorts, if you feel like they're beating you up in the conversation and you're getting. It's going to take about three of these phone calls. They're very unpleasant conversations. You're not going to find understanding, compassionate, pastoral humans on the other side of this. Okay.

[Ken Coleman]

Yeah.

[Dave Ramsey]

These are ambulance chasing lawyers. Literally, Ambie. They literally chase ambulances. For real. Okay. And so this is, you know, and they work for a car insurance company. God almighty, what a horrible law job. I mean, you got your law degree and this is the only thing you can do, which means you're not much of a lawyer. So, yeah, this is who you got to deal with. And you're gonna be nasty. And you gotta, and you gotta just go, no, no, no, no. I guess I have to do what my father in law said and file bankruptcy. I don't know. No. If you can come up with a settlement number on a lump sum, I'll go down the credit union, see if I can borrow it to help her out because I just married her. But no, no, no. What part of no don't you understand? It's a complete freaking sentence. No, no. This is how it's going to go. You follow me, Noah?

[Ken Coleman]

Yeah, I follow you.

[Dave Ramsey]

I don't want you to think that you're going to make one phone call and they're going to go, oh, we completely understand. We'll take 23. If they do that, I'll fall out of my seat.

[Rachel Cruze]

It's true. Stick to the script. And I would go so far as to what Dave has told you. Type that out or write it out. And when you're on the phone, because they've done this before and they will try to manipulate your emotions. And I'm telling you to stick to the script.

[Dave Ramsey]

Give them, no matter what they say, no information.

[Rachel Cruze]

It's like a politician running for office. No matter what you ask them, they.

[Dave Ramsey]

Say, give us a current address on you. No. What's her Social Security number? No. What's yours? No. Where does she work? No, I'm not talking about any of that. We're not writing a biography on my wife. Honey, we're trying to settle this.

[Rachel Cruze]

Yeah, I'd repeat The same line over and over until they realized this is a kid that I'm not gonna crack. And then they don't want to play.

[Dave Ramsey]

You know, the only thing I can say yes to is bankruptcy. And then you get what's known as a zero.

[Rachel Cruze]

Yeah. So 20,000.

[Dave Ramsey]

Let's start from zero and go up. Where are we going from there? I can file bankruptcy for a thousand bucks. So, you know, know, I'll give you a thousand bucks so she doesn't file bankruptcy. Let's start from there if we got to. Come on, dude, let's figure this out.

[Rachel Cruze]

You know, it just occurred to me, Dave, I would really enjoy doing that once or twice on behalf of someone else. Do you know what I mean? Just kind of call up and go, hey, and just play the game too, because we got no emotion in it. We're really fun to mess with those people.

[Dave Ramsey]

I used to. But we used to actually do that as part of our counseling here.

[Rachel Cruze]

Yeah.

[Dave Ramsey]

And I quit doing it because we would get it all fixed and the consumer didn't have in the person that was in debt, didn't have any blood in it. And so then they go screw it up the next month and not follow through on it.

[Rachel Cruze]

Right, right, right.

[Dave Ramsey]

But if they put it together, they don't screw it up.

[Rachel Cruze]

You would never do this. But it would absolutely melt YouTube if we did it live, though.

[Dave Ramsey]

Thoroughly enjoyed it.

[Rachel Cruze]

Could you imagine if we did that live, folks?

[Dave Ramsey]

Beat the snot out of American Express.

[Rachel Cruze]

Dave's calling for a hobby. I know his Uncle Dave, and I've taken over this negotiation.

[Dave Ramsey]

I'm Mrs. Savage. I work for American Express. You changed your name to Savage? It would melt one lady, her name was. She named herself Mrs. Baskerville. As in the Hounds of.

[Rachel Cruze]

Hey, George, Camel here. Listen, we need to talk specifically about Mama Bear legal forms.

[Dave Ramsey]

Allow me to paint you a picture. You plan a vacation, you make a budget, you book the Airbnb, you build.

[Rachel Cruze]

A spreadsheet of activities because you're that person. You fire up the Maps app and boom, boom, Trip of a lifetime.

[Dave Ramsey]

So here's the question.

[Rachel Cruze]

If you plan that carefully for a one week getaway, why are you just.

[Dave Ramsey]

Winging it when it comes to your will?

[Rachel Cruze]

Not having a will in place is.

[Dave Ramsey]

Like dropping your family off at a.

[Rachel Cruze]

Foreign airport with no map, no translator, and no clue what happens next. So when you pass away, sure, your.

[Dave Ramsey]

Family will be grieving, but they're also.

[Rachel Cruze]

Overwhelmed, stuck in court, and letting the government decide what happens to everything you worked so hard for.

[Dave Ramsey]

All because you didn't leave clear instructions. So the good news is you can.

[Rachel Cruze]

Fix this in 20 minutes with mama Bear legal forms. I used them for my own will, and it was fast, simple, and gave.

[Dave Ramsey]

Me and my family peace of mind.

[Rachel Cruze]

There's no stuffy lawyer's office, no drama.

[Dave Ramsey]

Just a few clicks, and your family's protected. Listen, a will is too important to ignore.

[Rachel Cruze]

It's how you love your people. Well, even after you've yeeed your last.

[Dave Ramsey]

Haw, as we say in the south.

[Rachel Cruze]

So go to mamabearlegalforms.com and handle this tonight. Use the promo code Ramsey and you'll save 20%. That's mamabearlegalforms.com, promo code Ramsey.

[Dave Ramsey]

You work your butt off for your money, but your money's never going to return the favor if all you do is hope for the best. If you're ready to learn how to make your money work for you, check out the SmartVestor program. SmartVestor can help you find advisors who specialize in retirement planning, charitable giving, advanced investing strategies, and more. Whatever your goals, your pro will take the time to explain your options so you never have to invest in anything you don't understand. Head to ramseysolutions.com smartvestor to get connected.

[Ken Coleman]

Ramsey Solutions is a paid non client.

[Dave Ramsey]

Promoter of participating pros. Learn [e-mail] Smartvestor Janet is in Augusta. Hi, Janet. How are you?

[Ken Coleman]

I'm fine. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

Well, I've got a little bit of a dilemma. I'll be turning 71 next month and I am in debt with student loans that equal to right at $100,000. A little over.

[Dave Ramsey]

Wow. How in the world do you get $100,000 in student loans at 71? Tell me this story.

[Ken Coleman]

I started back in 99 when I started with these student loans and they have just ballooned out from under me. And. And I've been listening to you and I know that I need to work out a way to get out of debt before I leave this earth. So I'm looking for some guidance.

[Dave Ramsey]

What were you studying? And it was in your 50s, right?

[Ken Coleman]

Yeah, I was in my 50s. I started going to college late in life, went and got a BS degree, and then I went on and got my master's degree.

[Dave Ramsey]

In what?

[Ken Coleman]

And Business. Business administration.

[Dave Ramsey]

All right, And. And then you did not end up making a bunch of money as a.

[Ken Coleman]

Result or haven't made enough to overcome that, that's for sure. I've Been paying on them, but it's just not enough to make a difference.

[Dave Ramsey]

Yeah. Do you have any money?

[Ken Coleman]

Very little.

[Dave Ramsey]

What do you have less?

[Ken Coleman]

Less than 50,000.

[Dave Ramsey]

Okay. And are you still working?

[Ken Coleman]

Yes, I'm still working. I've got two jobs.

[Dave Ramsey]

What do you make?

[Ken Coleman]

I've got one that I just started and I'm not sure what I'm going to make per year, but it's probably around 35,000. And I teach part time and I'm making ready at 20,000 with that.

[Dave Ramsey]

That. Okay. How's your health?

[Ken Coleman]

It's good.

[Dave Ramsey]

Okay.

[Rachel Cruze]

What is the job you just took that you think you're going to make 35,000?

[Ken Coleman]

It's a remote job, selling cars. Okay.

[Rachel Cruze]

Did you do anything with that business degree and masters, specifically in the business world, some type of leadership or management role?

[Ken Coleman]

Yes, I. I was a dean for three or four colleges once I finished that, but I haven't been able to get back into that field.

[Rachel Cruze]

Okay, so you went and got education and then basically used that education in higher education.

[Ken Coleman]

Correct.

[Dave Ramsey]

What's the most money you ever made?

[Ken Coleman]

90,000.

[Dave Ramsey]

Good for you.

[Ken Coleman]

Yeah.

[Dave Ramsey]

All right. Well, there's no secret to this. It's just math. Okay. And that's what, that's what my brain is sitting here crunching. I'm trying to figure out because we have. How do we find $100,000 out of a $55,000 income with 71 years old? If you found, if you found. If you lived on 35 and put 20 a year on 100, you'd be done in five years, you'd be 76. Okay.

[Ken Coleman]

Okay.

[Dave Ramsey]

And so the problem is we have a pretty, pretty good sized hole and a medium to small shovel.

[Ken Coleman]

Yeah.

[Dave Ramsey]

And so that's what's bothering me mathematically. And you have any. I'm sure you've already thought these things, but I'm just, I'm poking around with Ken. Is there any chance you get back into some kind of dean's role even if it was temporary and made that kind of money for two years?

[Ken Coleman]

I have actually been trying. I've just. I'm trying to do it at the same time trying not to have to relocate to do it?

[Dave Ramsey]

Yeah, I think you're gonna have to relocate if you want to get rid of student loan.

[Rachel Cruze]

To that end, what is your living situation? Do you rent or do you own your home?

[Ken Coleman]

We own.

[Rachel Cruze]

Way we buried the lead here. Who's we?

[Dave Ramsey]

Where's he?

[Ken Coleman]

He's disabled.

[Dave Ramsey]

What does he make on his disability?

[Ken Coleman]

Right around 1400amonth.

[Dave Ramsey]

Does he have any money?

[Ken Coleman]

No, sir.

[Dave Ramsey]

Okay, so we don't have any money. What's our house worth?

[Ken Coleman]

Our house is worth about 245. 245k.

[Rachel Cruze]

What do you owe on it?

[Ken Coleman]

Read it. 100.

[Rachel Cruze]

And before we think relocation. I'm just digging here. The, the teaching job, is that a part time teaching job in the local public school system? What is that?

[Dave Ramsey]

No, she says online, didn't you?

[Rachel Cruze]

No, she's selling cars part time. Oh, it is. Oh, it's online.

[Ken Coleman]

Everything I'm doing is. Yeah, everything I'm doing is online. I'm trying to.

[Dave Ramsey]

I heard that.

[Rachel Cruze]

I got that. I heard you were saying selling cards. I didn't catch the teaching thing. But, but let me ask you this. What if you were to teach locally and it wasn't online, what do you think your salary could be in the school system?

[Dave Ramsey]

Whether it be private, local, community college.

[Rachel Cruze]

Yeah, local, whatever. What could you make?

[Ken Coleman]

I think we would probably be looking at about 50 or 60,000.

[Rachel Cruze]

Yeah, yeah, I think you're gonna be doing that.

[Dave Ramsey]

Yeah. We gotta get your income up at least for a couple of years so you can knock this thing out. Otherwise it dies with you. You.

[Rachel Cruze]

Yeah, here's my recommendation. Okay. I, I think you need to try to get full time in this, in, in some type of education role locally then I would be trying to make an additional 30,000 doing online teaching. Now this is going to work you to the bone.

[Dave Ramsey]

But again for two years and you.

[Rachel Cruze]

Could be clear then you can get through this. But that's what. You have the best income potential because of your stellar education background.

[Dave Ramsey]

Yeah. And you just live on beans and rice. And for two years we throw 50k at this, but you got to go make the extra 50k right now and not, not over and above what you're making, but enough that you've got 50k margin in your all's numbers. And do that for two years and you'll be 73. And be clear. And this thing doesn't stay with you up into your 90s, hovering around wondering when they're going to come do something to you. And that's what's scaring me. For you, this whole thing scares me. And so the lesson for those of you out there is twofold. One is if you're going to go back to school at any age or go to school at any age, pay for it or don't go. The other one is that if you're going to go make 90 and you owe 100, you need to get it paid off real fast so that you're not sitting here eight years later or five years later after she last made 90. And so for those of you listening, that doesn't help Janet, but that, you know, part of listening to this show is figuring out what you can learn from it so that you're not 71 and having this exact conversation. This is an unpleasant conversation. She's in a pickle.

[Rachel Cruze]

Is the house on the table, Dave, or no?

[Dave Ramsey]

I don't think so.

[Rachel Cruze]

I don't want it to be.

[Dave Ramsey]

I don't think so. Because the student loan dies with her and he gets to keep the house. And so, no, I'm not gonna sell the house to clear it at 71. But I would do a lot of things to try to get my income up for a 24 month period of time and just to get. Just to spend the last two decades or whatever of my life without freaking Sallie Mae circling me like a buzzard. Connor is in Nashville. Hi, Connor. How are you?

[Ken Coleman]

How's it going, sir?

[Dave Ramsey]

Better than I deserve. What's up? So I have a Jeep Wrangler and.

[Ken Coleman]

I'm trying to find a way to get rid of the payment.

[Dave Ramsey]

I owe about 17,000 on it. Mm. Okay. What's your worth?

[Ken Coleman]

It's about well on right now. It's inoperable, so it's only worth about three grand.

[Rachel Cruze]

Why is it inoperable?

[Ken Coleman]

The aluminum on the block cracked.

[Rachel Cruze]

Oof. I'm clueless about that. But what's that gonna cost to repair that?

[Dave Ramsey]

It's a whole engine. He blew the engine. How'd you blow the engine?

[Rachel Cruze]

Okay, I didn't know.

[Dave Ramsey]

How did you blow the engine on a damn gum Jeep wrangler? You don't have to ask Chrysler that question. I'm asking you. You were jacking some four wheels.

[Ken Coleman]

1.

[Dave Ramsey]

You were running some Rs, buddy, and then you hit the creek, and the creek was cold and the engine was hot.

[Rachel Cruze]

I'm completely lost right now. I have no idea what these things are, said James. This. I love this terminology. Did you mess this engine up yourself?

[Dave Ramsey]

Yeah, I don't believe so, but okay. All right. How. How many miles on this car? 130,000. Okay.

[Rachel Cruze]

9,000 is what's going to cost to fix it.

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

That's a new engine. The car's not worth a new engine, so you need to go to a salvage yard and buy a used engine out of a wrecked Jeep. That's probably about three. That's probably about three grand. Probably going to take you about a Grand to get it in. What do you make?

[Ken Coleman]

About 48 a year, sir.

[Dave Ramsey]

Okay. All right. Yeah. You're gonna be working a lot of overtime to clean this mess up. What are you driving right now?

[Ken Coleman]

My GMC Sierra.

[Dave Ramsey]

What's it worth?

[Ken Coleman]

Want to say about 10 grand.

[Dave Ramsey]

Okay. All right. Yeah. The problem is that, I mean this jeep fixed is probably worth 12, right?

[Ken Coleman]

Yes, sir.

[Dave Ramsey]

Okay. And so it's worth salvage right now. And if you spend 4 on it, you can make it worth 12 again. And so you need to scratch up the 4 and fix it that way and then sell it. And that's how you get the most out of it. That's, that's your repair. But no one buying that Jeep is going to be expecting a brand new engine in that Jeep. From Jeep. From Chrysler. No, thank you. They're going to be buying, you know, they're buying a used Jeep that's, that's probably on its last run. It's 130,000 mile Jeep and you put a 40,000 mile engine in it from a junkyard and that's perfectly acceptable in that situation. If I was buying that jeep, I wouldn't think anything about that. That wouldn't bother me a bit.

[Ken Coleman]

Yes sir.

[Dave Ramsey]

And so yeah, you scratch up the money, start talking to your mechanic about hunting down a bargain on a 40 or 50,000 mile salvage engine out of a junkyard, and then what's it going to take to install? It's probably at least a grand. Change it out. And you need the cheapest mechanic in the world to change it out. This is not some retail thing. Is certainly not the dealer.

[Ken Coleman]

Sir.

[Dave Ramsey]

I'm the cheapest mechanic in the world.

[Ken Coleman]

I'll do it.

[Dave Ramsey]

Oh, so you can, you can pull the engine?

[Ken Coleman]

Yes sir. I have the pulley in the garage.

[Dave Ramsey]

How'd you blow it then? You know, I'm the one that checked it.

[Ken Coleman]

I checked underneath. You know where the valves are on them engines?

[Dave Ramsey]

Yeah, down on the left side.

[Ken Coleman]

It expanded too much and cracked right there when it cooled off.

[Dave Ramsey]

Yeah, but I mean how. What did you do that? I mean you, you think the engine was just. Was flawed because130,000 mile engine shouldn't blow in that car.

[Ken Coleman]

Honestly, I'm not sure if it was flawed.

[Dave Ramsey]

That's what I've been thinking because that's my daily driver. I don't take the GMC to work.

[Ken Coleman]

Until I've started having to.

[Dave Ramsey]

But you weren't, you weren't screwing off mudden or something? Something? No sir. Okay. Because that, that's how you blow those engines. I mean, you run because they're not that great an engine to start with and they won't handle high R's. And you run high R's through that thing and then hit it into a. And hit it into a temperature change. It'll blow it in a heartbeat. So. All right. Yeah. Oh, wow.

[Rachel Cruze]

This is great. I thought I was sitting in on a mechanic show.

[Dave Ramsey]

Remember those guys? Were those guys still around?

[Rachel Cruze]

Yeah, they've got. They've got to be in every local market. There's got to be a mechanic show in every big.

[Dave Ramsey]

There was a famous one that was nationally done. I don't know, back when I was first doing talk radio. They were. They were great.

[Rachel Cruze]

I'm afraid to ask this one. Ask quickly. We'll move on.

[Dave Ramsey]

Okay.

[Rachel Cruze]

Are high Rs RPMs?

[Dave Ramsey]

Yes, sir. Yes, sir.

[Rachel Cruze]

Okay.

[Dave Ramsey]

Yes, sir.

[Rachel Cruze]

Thank you. Audience members are clapping for me. They know how clueless I am. There's like real men out there going.

[Dave Ramsey]

Oh, it's not, it's not a. It's not a masculine thing. It's just a mechanic thing.

[Rachel Cruze]

I'm joking.

[Dave Ramsey]

You can be masculine and not be a mechanic.

[Rachel Cruze]

High Rs.

[Dave Ramsey]

But the.

[Rachel Cruze]

I don't know what he was saying. I'm glad I got that.

[Dave Ramsey]

But you know, we've. Daniel's got. Daniel's got a wrangler they bought when he was 16 and then I ran it for a while while he was in college and then gave it back to him as a graduate.

[Rachel Cruze]

Is that the green one?

[Dave Ramsey]

That's the green one.

[Rachel Cruze]

I told him the other day if he ever gets tired of it. That's a good looking jeep.

[Dave Ramsey]

It's a good looking jeep. The engines are crap. Crap. It's a little four cylinder piece of crap. Nothing.

[Rachel Cruze]

I didn't know that you knew engines like this.

[Dave Ramsey]

Well, I don't, but you're a Renaissance man, so. Yeah, there's out. Yeah, right. Anyway, open phones at Triple 882-55-5225. You probably just learned everything. I know. Matt is in Raleigh. Hey, Matt, what's up?

[Ken Coleman]

Hey, how you doing, Dave?

[Dave Ramsey]

Better than I deserve. How can I help?

[Ken Coleman]

Well, my wife took. Or my wife and I took financial.

[Dave Ramsey]

Peace when we were engaged.

[Ken Coleman]

We've been married almost a year now. We're in pretty good standings. Really. We're on step 3B considering pretty substantial life change actually of getting out of our rental house. We pay a decent amount of money. It's a nice place, but we don't really need it at the moment.

[Dave Ramsey]

What is how much do you pay.

[Ken Coleman]

With utilities? It's probably about 2100.

[Dave Ramsey]

Okay. It's just two of you.

[Ken Coleman]

Yeah.

[Dave Ramsey]

Okay.

[Ken Coleman]

I mean it's like a little three bed, two bath house on point seven acre.

[Dave Ramsey]

Yeah.

[Ken Coleman]

Like it's a nice place, but it's.

[Dave Ramsey]

More place than you need for a rental. Yeah. While you're trying to save up money for a house. It's too much. Right, Right. Yeah.

[Ken Coleman]

I. I've been blessed with great in laws. They have a finished basement for them. They've allowed us, they've pretty much agreed to let us come down there for a year or two, move in, just help us pocket, you know, a lot of money that we can in this time period. I would like to know, should I continue contributing to my retirement or not?

[Dave Ramsey]

Up to you. The more you put in the retirement, the longer you're in your mother in law's basement. That was the same thing I had in mind.

[Ken Coleman]

I know it's. I've heard you say like up to three years.

[Dave Ramsey]

Yeah. Being out of retirement but not being in your mother in law's basement. I didn't say that. So, hey, you guys do what you want to do. I will tell you that Sharon and I would move to a cheap one bedroom apartment and continue our autonomy. And that would slow down our house payment. Save up. You've done very, very well so far. I feel very confident you'll be able to buy a home doing that without losing your autonomy. I'll just leave it at that. Or privacy or whatever else we want to call it.

[Ken Coleman]

It.

[Dave Ramsey]

And that's not to say that your in laws aren't wonderful people. You preface this with their wonderful people. Most of them are wonderful people. At a distance.

[Rachel Cruze]

I couldn't agree more. I got nothing to add to this. I just don't think it's healthy.

[Dave Ramsey]

It's not bad, but it just.

[Rachel Cruze]

I know there's a difference between.

[Dave Ramsey]

You have it in your head as it's going to be one thing and it usually turns out to be something else. That's the problem.

[Rachel Cruze]

That's what I mean by the healthy part. It's not negative. It doesn't mean anybody's ugly to each other. But it's just at some point gets to be old because it's not natural. Maybe I'll say it that way.

[Dave Ramsey]

Well, it's like. Yeah. It's just. Yeah.

[Rachel Cruze]

Short term. Okay. Very short term.

[Dave Ramsey]

This is not an emergency. This is just a. This is a money play. And so I personally wouldn't do it. I'm not mad at you guys if you do it. But if you do it, I would shorten it as short as I can make it. And that makes the shorter time you're there, the better the probability is you get out of this with everybody's relationship intact. And so, you know, get in and out. And that means, yeah, I would stop my retirement and go crazy on saving for a down payment. Personally. Dave and Sharon, we moved into too big a thing when we first got married. I went back and visited my old elementary school principal, told her where I was living and she said, you're a fool, get out of there. You're spending too much. You need to go rent something cheap. And I listened to her and I went and cut my rent in half. We moved into a one bedroom and bought our first house a year later. And so, and that's even when we were broke and doing stuff wrong. Buying and selling a home is a big deal and you want an expert in your corner fighting for you to get the right deal at the right price. That's why we only recommend Ramsey trusted real estate agents. They're hand picked pros who know their stuff, listen to your needs and have your back from the first call all the way to closing day. To find a Ramsey trusted agent near you, visit ramseysolutions.com agent ramseysolutions.com agent hey guys, I love summer, but do you ever notice how fast money can get out of hand this time of year? You know how it is. You want to make all these great memories. It's so easy to just, just put your brain in beach mode and swipe that credit card. But then you end the summer saying, where the heck did all this debt come from? Look, I want you to have some fun. I just want you to plan for it with a budget. The EveryDollar budget app is the easiest way to make a plan for your money. And I'm telling you right now, when you do that, you'll see that a budget doesn't confine your money, it defines it. It puts you in control of where your money's going so you can enjoy your summer without overspending or going into credit card debt. So go download everydollar for free in the App Store or Google Play right now. If you're tired of living paycheck to paycheck and wondering where your money's going, your first step is getting a plan, a budget. Our team's hosting a free budget trainings, several of them this month. That's why it's trainings with an S. You'll Learn step by step how to make and stick to a budget using every dollar. Plus you can get your biggest budgeting questions answered live at the Q and A. The Q and A might be the most fun of the whole thing. Spots are limited. Sign up for [e-mail] webinar. Darla is in Tulsa. Hey, Darla. How are you? Great.

[Ken Coleman]

How are you, Dave?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

It's a pleasure to speak with you. I started following you. My husband and I started following you in 2005. We got totally out of debt, started investing and saving, and we're both retired now and living with a million dollar net worth.

[Dave Ramsey]

Way to go. Enjoying life, proud of you.

[Ken Coleman]

You've been a blessing to us.

[Dave Ramsey]

Good work. How can we help today?

[Ken Coleman]

Okay, my question today is I want to try to encourage my granddaughter who just graduated high school. She's working, she's going to start college in the fall. She's been taking some classes already, but basically wanting to help her get on a savings plan. And I'm thinking of doing some kind of map with her, you know, can show us where to get paid. My husband.

[Dave Ramsey]

You're breaking up. Can you speak direct into your phone?

[Ken Coleman]

Yes. We're wanting to get. Get our granddaughter on a savings plan. Help encourage.

[Dave Ramsey]

She's 18. Okay. How many grandkids do you have? How many grandkids do you have?

[Ken Coleman]

Two.

[Dave Ramsey]

And how old is the other one?

[Ken Coleman]

Eight.

[Dave Ramsey]

Okay. All right. Well, the only reason people save, the only reason people delay pleasure is for a greater good. So there has to be a target, a goal, an inspiring goal, a dream that is dreamed in high definition. So what is it this 18 year old is saving for other than to please her grandmother?

[Ken Coleman]

Well, she's going to be responsible for some of her own college expenses. Okay, I know that.

[Dave Ramsey]

All right.

[Ken Coleman]

She'd like to have a nicer car.

[Dave Ramsey]

Okay.

[Ken Coleman]

Other than that, we haven't really.

[Dave Ramsey]

Okay. I would define the goal and then show her how you matching will help her get to the goal faster. But that needs to have a very concrete thing. If it's just throwing money into an account, into eternity, it doesn't feel like it's attached to anything. It has no motivation to it. So if you say, okay, honey, you got a better car. So what's your car now? It's a $2,000 car. What do we want? We want a $10,000 car. So we need $8,000. Okay. If I'm matching, that means you need $4,000. How much can you save a month? I can save 200 bucks a month. Okay, how quick we gonna get to $4,000 then? Right, because every time you save 200, I'm gonna put 200 with it. After you get to the goal. I'm not matching you until you get to the goal. But when you get to the 4,000, I'm making these numbers up. They may be different.

[Ken Coleman]

Sure.

[Dave Ramsey]

But whatever it is, honey, you save towards as quick as you get to 4,000. And I'm gonna coach you and help you look at your budget so you can get there and no spending. We're saving for a better car. We're saving for a better car. We're working for something big. We live like no one else, so later we can live like no one else. No discipline seems pleas it yields a harvest of righteousness. And, honey, the reason I'm teaching you to do this is the key character quality of people who are able to build wealth are those who are able to delay pleasure for a greater good. That's called saving. I want you to build this muscle, and I'm going to help you.

[Ken Coleman]

Okay. And only pay it. Don't pay it month to month.

[Dave Ramsey]

No, because it just builds up in an account. And then she's going to come over and want to buy a car half the price.

[Ken Coleman]

Right.

[Dave Ramsey]

Quit early on the deal.

[Ken Coleman]

I was wondering how I could keep, you know, an eye.

[Dave Ramsey]

Yeah, I want. I want her to play through.

[Ken Coleman]

Yeah.

[Dave Ramsey]

Whatever it is. I don't care what we're. But let's set a target with an actual dollar amount, and then we can back into how many months it's going to take to get there. And then you get to ride alongside her and coach her and go. When you get there and you ring the bell, I'm doubling it. And we're going to go out and pick out a car bag.

[Ken Coleman]

Okay.

[Dave Ramsey]

Or whatever the thing. Whatever the thing is.

[Ken Coleman]

Yeah. I can see how that would make quite a difference than just doing it month to month.

[Dave Ramsey]

Yeah. And. But the month to month is coaching and cheerleading.

[Ken Coleman]

Yeah.

[Dave Ramsey]

And you earn the right to do that with the amount of money you're putting towards the doubling.

[Ken Coleman]

Okay.

[Dave Ramsey]

So this is a matching gift, you know, and go ahead and put a cap, put an exact amount on. On it. It's not more than this. It's not less than this. Okay. Once we agree in my example, it was $4,000 because we're trying to get to $8,000. But that was an example. I don't know what the numbers are, but whatever the number is, that's the number you agree to. And if she comes up, you know, $500 short of that, she needs to keep working. And if she comes up $500 ahead of that, that means she's got an extra 500. Not I match an extra 500 because we set a deal and stick to that. And then that enables you to do it for the next one too, because she doesn't get out of control here. But the whole time, the important thing is not the $4,000 match. The important thing is teaching her the principal and she gets the dignity of delaying pleasure for a greater good, which is a sign of emotional maturity. Whether you're 58 or 18. Somebody that can put off, you know, can endure pain for a greater good. That's a big deal. It's hard to find people do that.

[Rachel Cruze]

It is. And I think I would only. It's great advice. I'd only add that what I love about what Dave is telling you to do here is you're going to find out what your granddaughter really values about savings. And there are some people, we hear debt free screams all the time where somebody may take longer. They had a six month or maybe a year, they fell off. They got started in the baby steps and they fall off and then they realize, oh, that was stupid, I need to get back on. Everybody learns at their own pace. And by giving her this big goal that she's got and then saying, if you hit it, I match it. Even if she struggles and falls off but eventually gets back on, I just think it's the power of focus. It's a powerful thing. And if she falls off, fine. But this allows her to, to learn the process so that when she finally gets there, it's so much more valuable. It sticks longer.

[Dave Ramsey]

Paris is in Orlando, Florida. Hi Paris, how are you?

[Ken Coleman]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

Okay, so I have a $895. I think it's $45 car payment.

[Dave Ramsey]

Good lord.

[Ken Coleman]

And yes, I am on, currently on baby step two. And my issue is my car is giving me issues. It's giving me trouble. It's starting to get, you know, break down. And I was thinking about trading it in. However, I am upside down. I owe 25000 on it. I bought it brand new, the 2022, and I still owe 25,000.

[Dave Ramsey]

What kind of car is it?

[Ken Coleman]

The tailoride.

[Dave Ramsey]

What's wrong with it?

[Ken Coleman]

Well, I think the transmission is slipping.

[Dave Ramsey]

And the car's three years old.

[Ken Coleman]

Injection issues? Yes. The issue is my job requires me to drive a lot. So I have about 145,000 miles on it already.

[Dave Ramsey]

Yeah, but that kiosk transmission go longer than 145,000 miles.

[Rachel Cruze]

Theoretically.

[Dave Ramsey]

That's not a piece of junk car. That car should run.

[Ken Coleman]

No, it's not.

[Dave Ramsey]

Huh.

[Ken Coleman]

So I was thinking about trading it in.

[Dave Ramsey]

No, you trade it in, you got a mess. You've been trading in enough. That's how we got in this mess. So you owe what on the car total?

[Ken Coleman]

A little over 25,000.

[Dave Ramsey]

Okay. And it's worth what, 300? What's it worth?

[Ken Coleman]

The last offer I got was 10,000.

[Dave Ramsey]

Okay. And what do you make?

[Ken Coleman]

A little over 100.

[Dave Ramsey]

Okay. Are you single?

[Ken Coleman]

Yes.

[Dave Ramsey]

Okay.

[Rachel Cruze]

How much would it cost to fix a transmission if that's the full issue?

[Ken Coleman]

I don't know.

[Dave Ramsey]

Are you. A rebuilt one will be 7,500 bucks. Yeah. Okay. No, you don't need. I mean, if you need to get rid of the car, first thing we do need to do is get it paid off because you have a ridiculous car payment, and you're ridiculously upside down. So. No, I think if anything, you got to fix the transmission, keep driving it a while. If it blows out on you, you don't have a choice. You're stuck in this thing. You're so far into it. And you got a crummy interest rate, too, don't you?

[Ken Coleman]

No, it's not too bad. It's like 4%.

[Dave Ramsey]

Okay. Not as bad as I thought. Right. You got a horrible car payment. I know that. Yeah. You have identified the problem, and it is your cars. So don't trade again and make it worse. We need to clear this. And so, you know, $25,000 in debt, $100,000 income. No food, no eating out, no going on vacation. Sell so much stuff the cat's hiding our scripture of the day. Galatians 1. 10. Am I now trying to win the approval of human beings or have God, or am I trying to please people? If I were still trying to please people, I would not be a servant of Christ. Ronald Reagan says, I've been criticized for going over the heads of Congress. So what's the fuss? A lot of things go over their heads.

[Rachel Cruze]

You can see him doing it with a head tilt and a little wink. It's classic. Classic Romney.

[Dave Ramsey]

He might be the funniest president we've ever head.

[Rachel Cruze]

Oh, I'm going to go ahead and say absolutely. Of course, we don't have any footage of Andrew Jackson.

[Dave Ramsey]

I bet that dude was funny when he wasn't mad. Yeah.

[Rachel Cruze]

Yeah, right.

[Dave Ramsey]

Joshua was in Lexington, Kentucky. Hey, Joshua, how are you?

[Ken Coleman]

I am good. How y' all doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Ken Coleman]

My question is about tax brackets. So me and my wife, we, we make about 80, maybe close to 90,000 a year together. I've seen a tax bracket the other, other day that showed if you make like above 97,000, it would put you in like the 22%. So I'm wondering if I can kind of control my hours and how much I, I work. I was wondering if, if we get close to that, should I kind of aim for just below that? Would that save money or.

[Dave Ramsey]

No, that's not how it works. These are what, these are what called marginal tax brackets. The first so many thousands of dollars has zero. The next so many thousands is at 1% at whatever percent. The next so many thousand is another percent. And so if you make a little bit over, if you have a bracket creep here and you go over the bracket, it's only the amount of money that goes over the bracket that is at 22, not the whole thing.

[Ken Coleman]

Okay.

[Dave Ramsey]

So if you make $1,000 over, however, only the thousand is taxed at 22. Everything else is taxed like it was previously.

[Ken Coleman]

Okay.

[Dave Ramsey]

So never slow down working because of tax brackets. The best thing that can happen to you ever in our current system is to make so much money that you have the highest tax bill you've ever had because that means you made the most money you've ever made.

[Ken Coleman]

Yeah. Okay, that makes sense because we don't.

[Dave Ramsey]

Have 100% tax bracket yet.

[Rachel Cruze]

I'm glad you said that. It's not out of the realm of reality.

[Dave Ramsey]

Well, in the current land we live in, I think we're okay. But, you know, you never know when the socialists are in trouble or in power, so they put the rest of it, the capitalists in trouble. So. All right. Stephen is in Nashville. Hey, Stephen, what's up?

[Ken Coleman]

Hey, how you doing, Dave? Thanks for taking my call.

[Dave Ramsey]

Sure.

[Ken Coleman]

Okay, I, I have a quick question for you. Hopefully pretty easy. My father in law and mother in law, when he was younger, his, his dad went through and they had some type of investment account that they contributed to pretty much from when he was a little kid all the way up until he was 18 and a little bit on. And he didn't get access to that money until he was about 25. But he got access to that money and then was able to pretty much almost pay cash for a house because it had invested for so long. And everybody just kind of pitched in as they went. So this last Christmas they came to me and they said, hey, want to do something similar? I don't really know what my, my dad did, but we want to do something similar for your kid. So their grandchild and I don't know, they pretty much just told me whatever you, you can come up with both sets of grand and us as parents and some of the other immediate family want to contribute to it. He's a year old right now, so if we do that for 17 years or so, hopefully it'll be a pretty hefty sum there. So one, I want to ask about what investment should be looking for, how should I set that up? And then two, when it comes down the road, I really don't want to give an 18 year old if it's half a million dollars or something crazy at that point. How do I make sure that that is not accessed until he's maybe like 25? And then the tax implications and all.

[Dave Ramsey]

Okay, cool. Good question. If it's saved for college only or for education only, we of course would use the, an esa, an Educational Savings Account or something along those lines. But I don't think that's the goal here. So you can sit down, you can go to ramseysolutions.com and click on SmartVestor Pro. Find a SmartVestor in your area that you like and sit down with them and they'll help you get that account open and explain to you everything about how it works. Exactly. The basic principle is a child under 18 cannot do contract law in any state. In the United States they cannot contract for something so they can't open a bank account. If you open a kid bank account or a kid investment account, it's called an utma, a Uniform Transfer to Minors act utma. And so anytime someone says my kid has a bank account, they don't. The kid has an UTMA and the UTMA is in the kid's name, but there is a custodian of the account that would be you.

[Ken Coleman]

Okay?

[Dave Ramsey]

The person that's in charge of the money until they turn 21. At 21, you lose 100% control of the of it, technically speaking. Okay? And so, and the income is taxed at their rate. And unless this thing ends up with a million dollars in it or something, there's not going to be enough income that it creates to be taxable. So you're probably going to have no taxes on the account because the income it creates is not ever going to be enough to really do anything. And so you know that that's the, it's a very simple thing. You're opening an investment account and I would just put it in growth stock mutual funds. What I'd do is pick out one good growth stock mutual fund that's got a long track record and just open the account. Most of those require $1,000 to $2,500 to start them. And then you can just throw money in whenever you want or you can systematically have it withdrawn from your checking account and go in there. That is actually what we ended up doing, Steven, because the current college savings programs weren't available when our kids were little. So we simply saved money in our kids names. And the weird thing was by the time they ended up going to college, we didn't need the money for them to do that. So I just wrote the checks for college and then I was able to hand them that account after they got married. And that helped.

[Ken Coleman]

I'm a farmer. So if he wants to use that money for college, by all means, I want him to be able to do that. But at the same time. So that was my other question. So if it gets, if I use the specific one for education and he ends up not going to college, what happens to that?

[Dave Ramsey]

It's going to be taxable, the income, the income on it will be taxable. Not the amounts put in, but the income that will be taxable at that point. And so, you know, that's what we're looking for is that, you know. So I think probably the UTMA is the best plan now at 21, it's his technically. And so I ran into this moral dilemma of if there's $200,000 in their name and they're doing cocaine, how am I going to keep them from getting this money at 21? And basically I just made the decision as a parent, I would steal it. Completely illegal. Okay, you can't do that. It's illegal, but you can get sued by the kid and every friend the kid ever had and all that. But before I give my kids kid the money to overdose on cocaine, I'll just steal it and I'll suffer the consequences. The only other thing you could do is put it into a trust. I would not do that.

[Ken Coleman]

That's what I had heard from other people, which trust? And I've always been listening to you for a while and you usually say it's not the route to go, it's.

[Dave Ramsey]

Just too much, it's just too much trouble to deal with. This is a simple account, it's a mutual fund account. Got the Kid's name on it. You're the custodian. If you want to move the money from the mutual fund to a different mutual fund while the kid's going, you're in charge of the money until he turns 21. Then it's his. And I'll give you. You know, the way I didn't have trouble with my kids was I didn't surprise them at 21 and go, hey, here's a couple hundred. Gee, no, we didn't do that. Because that's how you, you know, they hit the lotto and they lose their dadgum minds. So instead, you know, we start talking about, these are your mutual funds when they were elected. And what you do with mutual funds is you do smart things, like you go to college or you buy a house or you do something like that. This is not really money to spend. It's money for your future. And look, here's how it grew. And we looked at the statements together when they were 12 and 14. By the time they're 15, they could calculate the value of the account. And so you just teach them as they go and don't surprise them, and then you have a better result by handing it to them them when they're 21. Good show today, Ken. Guys, in the booth. Booth, boys. Good job. That puts this hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the prince of peace Christ, Jesus.

[Ken Coleman]

Hey, you guys. I was shocked to learn that 88% of you out there are sharing the Ramsey show. I mean, that is so incredible. Thank you so much. And I want to tell you that we're making it even easier to share. So this June, we have pulled together the brand new Ramsey101 YouTube playlist. A quick start collection of how to get started walking the Ramsey plan. Now, this playlist is perfect for that one person in your life who needs help winning with money and just doesn't know where to start. So here's what's inside. What the baby steps are and why they actually work, how the debt snowball helps you pay off debt fast, and how to build wealth and invest for the future and so much more. So here's what you need to do. Click the link at the top of the show notes. It'll take you straight to the YouTube playlist. Copy it, text it, send it in a group chat. Just say, hey, I thought this might help because one playlist shared at the right time could be the turning point. One share, one playlist, one step could change everything for that one person in your life. So click the link, share the Ramsey show, and let's help someone out there start winning with money.