You Don’t Escape Debt by Waiting—You Escape by Acting

Summary

The Ramsey Show – Episode Summary

Episode Title: You Don’t Escape Debt by Waiting—You Escape by Acting
Date: January 27, 2026
Host(s): Dave Ramsey and Ken Coleman

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Overview: Main Theme & Purpose

This episode centers on practical, no-nonsense advice for escaping debt, taking control of your finances, and avoiding the pitfalls that keep people broke. Dave Ramsey and Ramsey Personality Ken Coleman tackle listener questions, confronting issues ranging from debt collectors, family financial dynamics, job loss, investing at a late start, and more. Throughout, the message is clear: You don't escape debt by waiting for things to improve—you take decisive action and change your behavior now.

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Key Discussion Points & Insights

1. Handling Debt Collectors for a Deceased Relative

• Caller Pat asks about being contacted by a debt collection agency regarding their late father, even though he had no debt.
• Dave’s advice:
  • Most creditors must file claims within a state-mandated window during probate; if that's passed, there's little legal exposure.
  • Still, collectors may persist. Dave recommends a polite but firm approach:
    • Provide partial info if comfortable (last 4 of SSN) and demand proof of debt.
    • If they don't provide proof but keep harassing, remind them of the federal Fair Debt Collection Practices Act and threaten legal action.
    • Block further contact if needed; involve an attorney if harassment continues.
  • Notable Quote:

    "These folks...are going to pull that thread and pull that thread and pull that thread. They're eventually going to end up hassling your mom, probably. So from a practical standpoint, I would put them down."
    — Dave Ramsey (03:02)

• Ken adds: These companies often have little info and high turnover; don't let them waste your energy.

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2. Should a Young Adult Pay for a Parent’s Life Insurance?

• Caller Frankie (24) is asked by her 65-year-old father to pay his life insurance as an "investment."
• Dave’s advice:
  • “That's a hard pass. That's a big no. Nope, nope.”
  • Explain politely: "Dad, I’ll be doing other investing, not investing in your death."
  • Insurance is not an investment, it’s protection for dependents. If the parent doesn't need it for coverage (i.e., has assets), it’s unnecessary.
  • Notable Quote:

    “Mathematically, [life insurance] is a bad investment because insurance companies make money on insurance.”
    — Dave Ramsey (12:48)

• Ken's take:
  • “This is just like Common core math. It just doesn’t make sense... This is just a wacky idea.” (14:19)

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3. Launching into the Baby Steps with Heavy Debt

• Caller Joel and spouse: $70k+ in debts (credit cards, cars, mortgage, second home) on $140k income.
• Dave’s steps:
  • Get on a budget (EveryDollar app suggested).
  • List debts smallest to largest (debt snowball), pay minimums except for the smallest.
  • Sacrifice—no eating out, vacations, etc.
  • Get aggressive: “You are broke people who make $140,000 a year.”
  • Consider selling expensive vehicles and/or the rental property for faster progress; otherwise, prepare for a longer, more intense journey.
  • Memorable Moment:

    "You gotta get disgusted about it... to where your friends think you've joined a cult." (16:47)

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4. Paying Off Big Debts with a Lump Sum – But Losing Your Safety Net

• Caller John (23): $57,000 in savings, but $35,000 car loan (upside down) and $25,000 student loans.
• Dave’s advice:
  • You didn’t get “screwed by the car industry; you got screwed by you.”
  • Either sell the car (even if upside down) and buy a cheaper car outright, or use savings to pay off all debts, then get back to saving rapidly (due to high income and low expenses).
  • Expect emotional discomfort at first (“heartburn”), but it’s temporary; you’ll rebuild the cushion quickly if you have no payments.
  • Notable Quote:

    “Your most powerful wealth-building tool is your income. And you don’t give it all to car companies and student loan companies. You get to keep it. And that causes wealth building.” (28:19)

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5. Career Concerns & Financial Stress After Job Loss

• Caller Chris was fired (after prior job loss), has two car payments, wife unable to work, and has hearing/depression issues.
• Dave and Ken’s recommendations:
  • Sell the expensive truck—payments are unsustainable.
  • Take any work available (warehouse/manufacturing, etc.), two or three jobs if needed, to reach basic expenses.
  • Seek counseling for depression; scrape funds for therapy.
  • No time for limitations—“you are the person that this entire household is relying on.”
  • Powerful Quote:

    "This picture that you have painted... is insanity." — Dave Ramsey (49:41)

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6. Setting Boundaries: Spouse Entangled Financially with Parent

• Caller Nicole: Husband’s joint credit card with his mom (who’s run up $14,000 in debt) creates major marital stress.
• Dave’s advice:
  • This is a boundaries issue: Husband needs to “leave and cleave” and become financially independent from mom—immediately close all joint accounts.
  • Don’t argue with or confront the mother-in-law—involve only the husband.
  • The real issue isn’t the mother-in-law but the husband's unwillingness to mature and create boundaries.
  • Notable Quotes:

    “You don’t have a mother-in-law problem. You have a husband problem.” (56:14)
    “Run down to Walmart and pick up a backbone. They’re on aisle three.” (57:01)

  • Ken Coleman: "The emotional umbilical cord needs to be cut... He’s never going to act rationally until the clear cut has happened." (60:35)

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7. Starting a Business: Does a Young Person Need Credit?

• Caller Amber: 18-year-old son wants to start a landscaping business debt-free and is concerned about operating without a credit score.
• Dave’s response:
  • He doesn’t need a credit score if not borrowing money—debt is not required for small business success.
  • Rule of business: takes twice as long, costs twice as much, and you are not the exception.
  • Focus on saving, buying equipment used with cash, and budget for unexpected costs.
  • On motivating teens: Use a friendly, not parental, tone after age 18 to avoid resistance.

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8. Should You Pause Paying Down Debt for a Major Life Move?

• Caller William: Newlywed, about to move to Hawaii, wondering if he should pause Baby Step 2 to save for moving expenses.
• Dave’s advice:
  • Yes—fully estimate, pause debt payoff, save for move with 100% focus, then resume Baby Steps after.
  • Ken adds: Get creative with side income to pile up cash even faster.

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9. Late Starter: How to Invest for Retirement in Your 50s

• Caller Jack: In mid-50s, no retirement savings, knows he needs higher returns but fears investing aggressively due to age.
• Dave’s advice:
  • You're not too old to invest for growth—in fact, you have to be.
  • The two main types of fear are: (1) things you don’t understand (education solves this), and (2) things that actually are dangerous.
  • Learn about mutual funds–consult with a SmartVestor Pro advisor to grow confidence and knowledge.
  • Ken adds: Also consider side hustles and extra work to pile up funds—urgency and momentum are key.

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10. Landlord’s Dilemma: Selling a Rental and the Tenant’s Fate

• Caller David: Hesitant to sell a rental because tenant may struggle to find housing.
• Dave & Ken’s guidance:
  • You’re the landlord, not their parent; provide reasonable notice (more than legally required if desired), but don’t assume full responsibility for their situation.
  • Not your job to manage her life—be kind, follow the law, but move forward.
  • Notable Quote:

    "You're not doing anything wrong to take an asset of yours and say, yeah, you don't want to be mean... But it does need to be very thorough and complete immediately." (119:15)

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Additional Topics

• Motivating high schoolers toward entrepreneurship: Ken recommends focusing on identifying interests, shadowing, and exposure to industries, not just “going into business” generically.
• Buying totaled cars: Accept insurance payout, check for fair value, and buy a reliable used car without debt.
• Marriage and Money: Wait until marriage to combine finances, close credit card accounts, aim for no credit score/manual underwriting for home-buying.
• Stay-at-Home Parenting Decision: Test living on one income for several months before quitting; keep credentials up to date.

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Timestamps for Important Segments

| Topic | Timestamp Range | |---|------------------| | Handling Debt Collectors (Pat, Boise) | 00:38–08:21 | | Paying for Dad’s Life Insurance (Frankie) | 09:25–14:44 | | Starting the Baby Steps with Heavy Debt (Joel) | 14:55–18:13 | | Paying Off Debt & Car Fiasco (John, NY) | 22:46–28:45 | | Job Loss & Family Strain (Chris, WY) | 43:13–50:59 | | Financial Boundaries with In-Laws (Nicole, Jacksonville) | 54:39–62:00 | | Teen Entrepreneurship Without Debt (Amber, Spokane) | 70:38–74:59 | | Pausing Debt Payoff for a Move (William, Providence) | 76:39–79:33 | | Late Retirement Investing (Jack, NY) | 96:02–100:48 | | Landlord and Tenant Morality (David, Chicago) | 117:03–122:28 |

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Notable Quotes & Memorable Moments

• On action vs. hope:

  "You don't escape debt by waiting. You escape by acting." — Dave Ramsey (episode theme)

• On car loans & financial maturity:

  "You are broke people who make $140,000 a year." — Dave Ramsey (16:08)

• On family boundaries:

  “This is very boyish, not manly behavior that he's engaging in.” — Dave Ramsey (57:01)

• On escaping debt:

  “Your most powerful wealth-building tool is your income. And you don’t give it all to car companies and student loan companies. You get to keep it.” — Dave Ramsey (28:19)

• On entrepreneurial reality:

  “Business is too hard… There’s a lot of dirt under the fingernails, boys and girls. It’s long hours. It’s the hardest boss you'll ever work for in your life.” — Dave Ramsey (37:34)

• On young adults & advice:

  “Once they turned 18 and beyond, I tried not to use my dad voice… Use your persuasive uncle voice.” — Dave Ramsey (73:04)

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Tone & Language

The tone is candid, direct, and at times humorous, with classic Dave Ramsey tough-love and practical wisdom. Ken Coleman adds supportive, career-focused insights, balancing firmness with empathy.

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Key Takeaways

• Waiting only prolongs your debt—action is the escape.
• Establish healthy financial boundaries from the start—don’t let family or friends drag you (or your spouse) into their chaos.
• No one is immune from “stupid with zeros behind it”—everyone makes money mistakes, but you can recover quickly with discipline.
• Aggressively attack debt, sell what you need to sell, get resourceful, and avoid new loans—regardless of income.
• Financial independence is about emotional maturity and clear boundaries, especially in family dynamics.
• Education conquers financial fear—when you learn how something works, you stop fearing it.

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For More

Visit www.ramseysolutions.com
Get the EveryDollar app, Financial Peace University, and additional guides and tools as referenced in the episode.

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End of Summary.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is the Ramsey Show. Ken Coleman, number one best selling author, Ramsey personality, host of the big hit on the Ramsey Network called Front Row Seat. He's my co host today. The phone number here is triple 825-5225. Pat in Boise, Idaho. Hi, Pat. How are you?

[Caller]

Hi, Dave. Thanks for talking to me. I'm the executor for my dad's estate. About six months after his death, I received a letter looking for the person who could act on his behalf. I looked up the company, and it's a debt collection agency primarily. Primarily focused on collecting debts related to deceased individuals.

[Dave Ramsey]

Wow.

[Caller]

They utilize technology. Yep. They take. Yeah, I've never heard of this either. They utilize technology like probate finder on demand and contact the personal representatives of the state to recover unpaid debt. So my dad absolutely did not have any debt. He was Dave Ramsey. While Dave was running around in diapers, he didn't borrow money. I do know that there is. Just from looking at unclaimed property. I do know that there is a gentleman who lived in the same metro area as my dad for many years who had his exact same first name, middle initial, and last name. So I'm thinking, I don't know, maybe they're looking for that guy here. Here's the deal. I don't even want to talk to them. I don't want to spend time on this. I don't know if you need to know the name of the company, but how worried do I need to be?

[Dave Ramsey]

Well, I mean, is the estate settled?

[Caller]

The. The probate is finished, but it's. It's not closed yet. I haven't closed it.

[Dave Ramsey]

Okay. What. What is lacking for it to be closed?

[Caller]

Nothing. I was just doing some final insurance policies and transfer of his property to my mother. So that is done. I can close the estate at any time? As far as I know, there was nothing that came up during the probate.

[Dave Ramsey]

So your mom's still there and she's sitting with whatever assets that they had?

[Caller]

Yes.

[Dave Ramsey]

Okay, good. Okay. Well, I don't know Idaho law, and I'm not an attorney anyway, even if I did. But the most states have a period of time that a creditor can file a claim against an estate before, after, or during the probate being open. Okay. And I don't know what yours is. Okay.

[Caller]

So if they. So if they didn't, I'm probably good.

[Dave Ramsey]

Probably. From. From a legal, practical standpoint or from a legal standpoint. From a practical standpoint.

[Caller]

I.

[Dave Ramsey]

These folks, they get. They have one little thread that they're hanging on, and they're going to pull that thread and pull that thread and pull that thread. They're eventually going to end up hassling your mom, probably. So from a practical standpoint, I would put them down.

[Caller]

I'm her power of attorney, so they won't get much further.

[Dave Ramsey]

I know, I know. But if they start calling her, start filling up her mailbox with stuff, I don't think there's a legal issue. I don't think they've got a claim. You don't think they've got a claim. They're probably outside the notice of meeting the creditors, period of time, all that kind of stuff. But that doesn't keep them from driving everybody in the soup crazy. Okay. So I probably would invest a few minutes and just shut them down.

[Caller]

How do I shut them down, though?

[Dave Ramsey]

I would just call them and say, he did not have any debt with you. I'm the executor of the estate, and you can give them a Social Security number, send him a copy of the death certificate. None of that hurts you in any way. And you know our. You know, I'll give you the last four digits of Social Security numbers if it matches with what you think you're hunting, but I think you're hunting this other guy, and you need to stop. And if you don't provide me proof of written proof of debt and you don't stop, I'm going to sue you under the federal Fair Debt Collection Practices act because you're violating it. Now that I have told you that I am demanding proof of the debt.

[Caller]

Can I just demand proof of the debt without providing them anything to start with, or should I give them.

[Dave Ramsey]

I'll give them the last four digits, Social Security number. What I'm trying to do is in case there's two brain cells on the guy you're talking to, if they happen to rub together, you want to give him a way to go away, oh, it's not him. I got to go the other way. Okay. Right. But in case they're. In case they. If they think. But the problem is some of these companies, and what you need to be prepared for is. And I think you're kind of already there, is they will try to collect from someone that they know is not legitimately the debt just by hassling them.

[Caller]

And that's what I'm worried about.

[Dave Ramsey]

Yeah, well, I'm not worried about it because you're going to shut them down. We're not going to talk to them anymore. Okay? We're gonna block them. And if they continue to pursue, I would have an attorney send them a letter under the federal Fair Debt Collection Practices act because they're in violation of federal law. If they continue to pursue after you show them that it is not his debt and you give them last four digits, Social Security number, and they don't provide proof of debt, the other thing that's gonna come up is they probably don't have proof of debt. They probably bought a line item on, on a spreadsheet. A lot of debt buyers don't get the actual documentation on the debt. They just get a line item, point of last contact, some details about a name, whatever the files got, and it's just a whole list of line items. It's not like they have a file on him. So they point being, I don't think they can provide proof of debt. But I'm going to ask because I'm going to make one or two phone calls with these people and try to in a civil way make this go away. But if you determine that A, they're trying to collect from somebody, just anybody, and they just think they can hassle you, then just pound their face. Right. Or B, that they cannot provide proof of debt and they won't go away. What I'm more than anything trying to do is get them to quit calling you and quit calling your mom and it's worth two phone calls to invest in that or never call your mom.

[Caller]

Okay, Right, I like that. Okay.

[Dave Ramsey]

Yeah. And then. But again, write that down. It's the federal Fair Debt Collection Practices Act. Okay. And it is federal law that they're violating. If you demand proof of the debt, they don't provide it and they continue to attempt collection. Hammer them.

[Ken Coleman]

I was looking for something to add. You covered it from every angle. You know, look, you got the facts and so don't be afraid to take this on and then shut it down. I think that's what this is. I don't think this is harassment. I just think Dave's nailed it. They don't have a lot of info.

[Dave Ramsey]

It's not harassment yet.

[Ken Coleman]

Not yet.

[Dave Ramsey]

Probably is going to be there if it doesn't stop.

[Ken Coleman]

That's right.

[Dave Ramsey]

So the thing is, folks, you gotta do. Debt buyers when they buy debts are typically paying anywhere from 2 to 8 cents on the dollar. So they're paying 80 bucks for a thousand dollar debt. And they can't even find the people in most cases. In this case, they're chasing deceased people's debt. Okay. So they're always trying to chase down the.

[Ken Coleman]

So this is basically prospecting.

[Dave Ramsey]

Yeah, yeah. They're dialing for dollars all day long. And you know, it's a horrible job. And here's a, here's. You want to be worse than somebody trying to collect on an old debt. Collect on an old debt that you know the person is dead. Right. I mean, this is a bad job. Cleaning septic tanks is more fun. And so honestly, seriously, oh my gosh, what a horrible position. So they probably got high turnover. You got a boiler room, phone room going. Looks like something on Wolf of Wall street or something.

[Ken Coleman]

That's right.

[Dave Ramsey]

And they're just, you know, and the average time on the job is 21 days. And they, they're just constantly hiring new people that are dialing for dollars. You're probably not going to talk to the same person twice.

[Ken Coleman]

And they're brainwashed by the way they come at you with a script.

[Dave Ramsey]

Oh, yeah.

[Ken Coleman]

And so that they don't get knocked off. So you better really be strong and show a lot of facts.

[Dave Ramsey]

And the other thing is, the neat thing about the technology is you can just hang the phone up, just push end.

[Ken Coleman]

That's always enjoyable.

[Dave Ramsey]

And then slide that little thing over that says block and you're done. They're done. Ken Coleman, Ramsey personality, is my cousin. Co host today. Thank you for joining us, America. Open phones at triple eight eight two five, five two two five. Frankie. Frankie is in Greenville, North Carolina. Hi, Frankie, how are you?

[Caller]

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

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So I have a pretty straightforward question. I talked to my dad yesterday and he wants me to pay for his life insurance policy. He said I should think of it like an investment and he doesn't want to actually pay for it himself. So I just wanted some advice on maybe how I can talk to him about paying for his own life insurance or should I pay for it myself?

[Dave Ramsey]

That's so weird, isn't it?

[Caller]

Yeah.

[Dave Ramsey]

When you heard, when you heard that you had to go say what? I don't know if you said it out loud, but you said it in your head, didn't you, Frankie?

[Caller]

I did. And he said it to my mom and he said, you know, because he's not going to be receiving any of the benefits. I was like, well, I mean, that's kind of the point. He Was saying since he's not going to be receiving it, I should pay for it since I can think of.

[Dave Ramsey]

It like, how old are you?

[Caller]

I'm 24.

[Dave Ramsey]

And how old is he?

[Caller]

65.

[Dave Ramsey]

Is he ill?

[Caller]

Not necessarily. I mean, he has some health issues, but I mean for his age.

[Dave Ramsey]

But his death is not imminent as far as we know, right?

[Caller]

Yeah, yeah.

[Dave Ramsey]

So you could be doing this for like 30 years.

[Caller]

Yeah, yeah, yeah.

[Dave Ramsey]

I think that's a hard pass. That's a big no. Nope, nope. Let's just call that. Let's check the. Not check the box beside nope. Now your question was though, how do I talk to him about it? Just go, dad, you know, I'm 24. I'm going to be doing other kinds of investing rather than in your death. And I don't think we're going to go this way, but thanks for the offer.

[Caller]

Yeah, okay. Yeah, I think that.

[Dave Ramsey]

Pretty simple. You don't need to be snarky about it, although it's really tempting, but it doesn't serve any purpose. Just be snarky about it other than make you feel just because it's just strange and he knows it's strange and I don't know. Your dad does stuff like this often, doesn't he?

[Caller]

Yes.

[Dave Ramsey]

Quirky, quirky, quirky dude. Okay. Yeah, I just, I would just smile and say, dad, you know, thanks for the offer. I've kind of thought about this and I talked with my financial guys and they said I should just be doing regular investing rather than investing in your death. And I'm just not comfortable doing that. And so. But thanks for the offer. No, and I really wouldn't go into a bunch of. I wouldn't go into a long, lengthy discussion about it. It's just a, two sentences and. No.

[Caller]

Well, what I'm going to do is.

I'm going to play this back for him later.

[Dave Ramsey]

Okay, that's fine. You can tell him I said obviously he's quirky, but. Because that's a really quirky thing to say to your 24 year old daughter, dude, if you're gonna play it for him. I mean, I wouldn't do that to my 24 year old daughter. You've got other things you should be doing with your life rather than investing in your dad's death. I mean, and besides that, mathematically it's a bad investment because insurance companies make money on insurance.

[Caller]

Right.

[Dave Ramsey]

The probability of his death is. And the payout is less than the premiums that they think they're going to receive if they don't receive premiums equal to the payout before he dies. They lose money on the insurance. And if they do that often enough, they go out of business. So insurance companies make money on insurance, which by translation means it's not a good investment. It is a good purchase for those of you out there. We had a debt free scream yesterday, I believe our day before yesterday, that the young lady's husband was killed in a car wreck. He was 30 something years old two months before they were debt free. Two months before that he had gotten life insurance and he had a brand new baby. Now that's a good time to buy life insurance. That's perfect. I mean that family's taken care of because that young man was just a stellar dad and husband. But this is a completely different thing. It's not a good investment. Mathematically, it is a protection for your family in the case of a horrible event happening. But if your dad doesn't, he's 65. He may not need life insurance. If he's got enough money. He could not just not buy life insurance. I'm 63, I don't have any life insurance. I have a huge pile of money and no debt. If I die, Sharon's gonna have a party. She doesn't need life insurance. Okay. And it'll be a big party. I guess not. If I die. When I die. If I die before her is what I should say. Right.

[Ken Coleman]

Well, we will sell her.

[Dave Ramsey]

We know that that's her plan. And I'm a little worried about it.

[Ken Coleman]

But yeah, yeah, I mean the data probably backs that up. I would just say this, that this is just like Common core math. It just doesn't make sense. And we already have good math. We don't need to invent something. This is just a wacky idea. The minute I heard it, it just.

[Dave Ramsey]

Wacky. Yeah.

[Ken Coleman]

And you can't, by the way, reason with wacky. You just got to move on quickly.

[Dave Ramsey]

Yeah, I wouldn't. No, dad, no.

[Ken Coleman]

You didn't have to deal with Common core math. And I'm glad because it would have made the top of your head explode.

[Dave Ramsey]

It must have been what happened. Ok. Joel is in Chicago. Hi Joel, what's up?

[Caller]

Hi guys. Pleasure to talk to both of you. Finally I have a question about. Question. I just started listening to you guys a couple weeks ago. I've been binge watching your podcast or listening to your podcast like every day non stop. Some. Me and my wife been talking about this and we're getting ready to start the baby steps. We have the 1000 already set. The issue that I'm having is I get you guys some quick numbers real fast. We're about 25 to 30 in credit card and personal loan debt. We have about 31,000 in two car loans, 122 in our mortgage. And we have a second home, which is our first purchase that still sits at about 40k and that's being rented currently.

[Dave Ramsey]

What's your household income?

[Caller]

We make around 140 combined before tax.

[Dave Ramsey]

And your question is simply how to start the baby steps?

[Caller]

Yes.

[Dave Ramsey]

Okay. We get on an every dollar budget. You and your wife are in agreement that we're going to get out of debt and we're going to sacrifice to do that because if you didn't have any of these payments, you'd have a lot of money.

[Caller]

Agreed, exactly.

[Dave Ramsey]

And that's the whole idea. And so do you have any savings that's not in retirement?

[Caller]

No, just the one K for the startup.

[Dave Ramsey]

You got the baby step one. Okay. Then we're going to list all these debts, smallest to largest. We're going to pay minimum payments on everything but the little one. We're not going to see the inside of a restaurant unless you're working there as an extra job and you're not going to go on vacation. You are broke people that make $140,000 a year. And you need to clean up this $70,000 worth of stupidity before you do anything else stupid. But car loans and all this other you've got. And you've got to get disgusted about it and attack it and attack it and attack it to where your friends think you've joined a cult.

[Caller]

I agree. The one, the one thing I did wanted to mention is I'm like the one car loan. We owe 2,000 on it. So that'll be gone in like the next four months.

[Dave Ramsey]

No, no, no, no. It doesn't take four months to pay off 2,000. When you make 140, you do that the first time.

[Caller]

Yeah, I agree. I totally agree with that. The second thing is the second car is our second vehicle, which is an SUV. That one's the one that sit in about 29,000. And I told my wife we need to just get rid of the car. And that's where she's kind of. No, I wouldn't be on it.

[Dave Ramsey]

I wouldn't. I don't think the best way to get your wife on board is not say, I want to sell your car.

[Caller]

That's actually just like a weekend vehicle. I drive a personal, I mean a work vehicle. Monday through Friday Is that your car drives. It's kind of both our cars, but we use it because we have three kids, so it's a larger vehicle for the family.

[Dave Ramsey]

So you have a work car.

[Caller]

Yep.

[Dave Ramsey]

That you own.

[Caller]

It's a, it's a company vehicle, but okay.

[Dave Ramsey]

Vehicle. Okay. And then she has a car.

[Caller]

Yep. Which is the one that's about to be paid off. And that's a community vehicle to work every day.

[Dave Ramsey]

And then the other one has 29,000 owed on it.

[Caller]

Yep.

[Dave Ramsey]

Well, her car that, that she owns. Carry your family.

[Caller]

Yeah, we'll, we'll fit. I mean, my oldest is about to finish high school and the other one, the smallest one, is like 10 years old, so I mean, we fit. Not that not much space, but I told her, you know, something we could do if we really wanted is.

[Ken Coleman]

Yeah.

[Dave Ramsey]

The other thing you could do. What's the rental worth?

[Caller]

I think about 1, 120, 130.

[Dave Ramsey]

Yeah. You could dump it and clean up the whole mess. But either one of those is fine or, or neither if you want to just bust all the way through it. You're gonna trade sacrificed lifestyle, scorched earth lifestyle longer. You're gonna stay in the mess longer if you don't move one or both of these other items. And that's the decision the two of you can make together. This is the Ramsey show. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly left behind, scrambling to pay bills and trying to make ends meet. I also discovered that there are a lot of rip offs in the life insurance world like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company. This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about. They shop the term life companies to find you the best options. And they've been around for over 95 years, so you know they'll be there when you need them. Zander is the real deal and that's why they've handled all my personal insurance for over 25 years. I trust them and you can too. Visit Zander.com for instant online quotes or for a more personal touch. Give them a call at 800-356-4282. Ken Coleman, Ramsey personality, is my co host today. Thank you for joining us, America. The best way to make the most of your money is a plan. Tell your money what to do instead of wondering where it went. Most people, the money comes in, the money goes out. Only the names are changed to protect the innocent. We don't know where it went. That's most people. And then you scratch your head and wonder why you're broke. If you ran a company and your job was to manage money, and you manage money the way you manage money for you, you'd get fired for incompetence. So. Cause if you, if you're working a business, you're supposed to have a budget and then you're supposed to, like, stick to it and stuff. Hello. That's kind of basic, y'. All. I mean, it's really not hard, but it's hard because it's dealing with me. And I got to look at the teenager and go now, and I got to have a discussion with my spouse about spending and, you know, we got to quit eating out every freaking night of our lives and then wondering why we have no retirement. Because we're eating it. That's why basic stuff like that comes up when you do a budget. Hello. That's why we came up with the idea that every dollar needs an assignment. Every dollar needs a name. Every dollar of your money before the month begins needs a mission beside it. You need to send it out there to do stuff for you. You work too hard to be broke. And the only thing that fixes that is giving every dollar an assignment. That's why we named the world's best budgeting app Every Dollar. And that's why tens of millions, no exaggeration, tens of millions of people are using Every Dollar every month, the budgeting app, to run their budget with their spouse. Download EveryDollar for free in the App Store or Google Play or go to everydollar.com and let's get started, boys and girls. It's time to do this. Open phones at 432-55225. John's in New York. Hey, John, how are you?

[Caller]

Hi, Dave. How are you, sir?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Good, good. So I'm around 20, I'm 23 years old, and I had around 57,000 liquid cash in the bank. And I got kind of screwed over by the car industry twice now. When I was 19, I bought a new Mustang. Hindsight. Very bad mistake. And obviously I was upside down and Then now I have a Cadillac, obviously. I got a pre owned. I Now that loan is around at 35,000. I just got it about eight, nine months ago. And then I have student loans of about 25,000. They're not crazy high because it was a community college. I've been listening to you guys for a while and I just wanted to.

[Dave Ramsey]

What do you make?

[Caller]

What's that?

[Dave Ramsey]

What do you make?

[Caller]

Around 80,000.

[Dave Ramsey]

What do you do?

[Caller]

I'm a bartender at my family's restaurant.

[Dave Ramsey]

Okay, Very cool. Very cool.

[Caller]

Thank you.

[Dave Ramsey]

Okay, and so your questions. What.

[Caller]

Should I. Because I've watched a couple of your videos. If I should just take the 57,000 and dump it into all the debt and just clear it, but then I have nothing left in my account, or do I like do thousands at a time and knock it down as quick as I can.

[Dave Ramsey]

Okay. Is your goal to be wealthy?

[Caller]

Yes. Yeah.

[Dave Ramsey]

Okay. Because you make a lot of money. You're doing really good.

[Caller]

Thank you.

[Dave Ramsey]

You must work really hard.

[Caller]

I do, yeah. I work six days a week.

[Dave Ramsey]

Yeah. And some serious hours, too. Yeah. Good for you. Thank you. For you, I mean, you're pretty sweet spot for 23 years old. Overall, I mean, you've done some stupid stuff, so. All right, a couple of things that come out of the conversation is one, you did not get screwed by the car industry. You got screwed by you. Because you walked on to the car lot and you bought a car you couldn't afford because you were acting like a child. Is that fair?

[Caller]

Yeah. Yeah, of course.

[Dave Ramsey]

Okay. You're not a victim, dude. You caused this, all right? Both times. So I don't know what a guy making 80,000 bucks that's 23 years old working his butt off needs with a $35,000 Cadillac. I don't know why you have to have that, Right. You might rather have the cash than that, right? So one option. Sell a car and buy a $10,000 car, right? For cash. And then you don't have to give up all your cash. You just give up the Cadillac.

[Caller]

That's the main thing I want to avoid, is I don't want to just deplete all my savings I worked for.

[Dave Ramsey]

Well, I mean, then the Cadillacs on the. On the block. So I mean, if you want to keep the Cadillac, you need to pay it off, right? So you're. All Your money's already gone. Paying it off. You just admit it.

[Caller]

Yeah.

[Dave Ramsey]

You've already spent the money. You just hadn't admitted it yet. By paying off the debt, of course.

[Caller]

Yeah.

[Dave Ramsey]

So, you know, it's. So you can do. But you can, you can choose. Okay, do I want to? Because basically if you sold the car for 35,000 bucks and you took $10,000 of your. And you broke even, got out of it, cleared it. Right. Will it bring 35?

[Caller]

No, I think it'll bring 24 because I got. I was upside down from the other.

[Dave Ramsey]

Oh, you rolled negative into it. Okay.

[Caller]

Yeah, I was around 9,000 and then I put 5.

[Dave Ramsey]

So you're gonna spend 10 of your money, even if you sell it, and you're going to spend another 10 of your money to buy a car and you're gonna spend some money to pay off the student loan debt.

[Caller]

Right.

[Dave Ramsey]

And you said. So you said 25 in student loans.

[Caller]

Yes, sir.

[Dave Ramsey]

Okay, so you're 60 and you got 57. So you don't have enough to pay off everything. Yeah, quite. But I mean, you're making money and you're used to stacking cash because you. So, all right, the premise is this. If we could get you where you had no payments, student loan and the car payments gone through whatever mechanism, either paying it off or selling the car, either one. You choose. Okay. If we can get you where you don't have any payments, but you. Most of your money is gone without any payments, making 80k, you could stack that cash up real quick again. It won't take long, just a few months. I mean, you probably save 5,6000 bucks a month, can't you? If you don't have any payments.

[Caller]

Yeah.

[Dave Ramsey]

Are you living at home?

[Caller]

I am, yeah. We, Me, my mom and dad live above the restaurant.

[Dave Ramsey]

Yeah. So you got almost no overhead. I thought that. Okay, so that's how. That's how the 57 got there.

[Ken Coleman]

I got some quick numbers here I want to run with you here. I think you're still walking away with Dave's plan with 11,000 in cash. Because if you owe 11, so you're going to pull 11 out because you're upside down, you're going to spend 10 on another car. So that's 21, 57. 21 is 36. We owe 25 in student loan. That leaves you with 11K and no payments.

[Dave Ramsey]

No payments in a paid for $10,000 car.

[Ken Coleman]

And you live at home with a.

[Dave Ramsey]

Pretty secure job and you're stacking cash like a boss man.

[Caller]

Right.

[Dave Ramsey]

You could, you could stack 6,000. I mean, in 10 months, you'd have 60,000 bucks on top of the 11. You'd have $71,000 in 10 months.

[Caller]

I mean, I also have 10,000 in an IRA that I'm maxing out every month as well.

[Dave Ramsey]

I would stop that until we get this mess cleaned up. But if you're going to clean up the mess in one fell swoop, you don't have to stop it. But you can stack cash. You follow me? Especially if you don't have a car payment. It's 35 grand.

[Caller]

Yeah.

[Dave Ramsey]

And so I'm going to use up all my money. Yeah. For a hot second. Because a month later you're going to have $10,000 more and a month later you're going to have $8,000 more and a month later you're going to have. You follow me?

[Caller]

Gotcha.

[Dave Ramsey]

Yeah, yeah. So you're not going to be out of cash, but just for a few days.

[Ken Coleman]

Well, you still have 11,000.

[Dave Ramsey]

I know you got 11, but I'm saying he's 57s down to 11 and that's causing emotional distress.

[Ken Coleman]

A lot of heartburn.

[Dave Ramsey]

Heartburn, yeah. Right. Yeah, yeah. So. But the point is it's a temporary situation and it's the best path for you to become wealthy because your most powerful wealth building tool is your income. And you don't give it all to car companies and student loan companies. You get to keep it. And that causes wealth building. And that's what I'm going to tell you to do. So I would be debt free either by selling the Cadillac or not immediately, even if it caused my heart to burn. And keep in, because keep in mind your heart's not going to burn for very long because with no payments and serious motivation called a little bit of fear, you're going to stack that cash real fast and you'll be right back where you are by Christmas and you'll be a whole 23 years old. Wow. You got lots of time to be smart now. This is the Ramsey Show. Running a business is already complicated. You don't have time to become a health insurance expert too. And when you're self employed, there's no HR department to lean on. But that's where my friends at Health Trust Financial come in. For over 20 years, they've been helping families and small business owners cut through the confusion and find the right health insurance plan for their stage of life and budget. Health Trust Financial offers unbiased advice and there's never any pressure. Health Trust Financial helps you shop smarter and avoid overspending. Most of their clients save hundreds of dollars every month. Real savings you could put back into your business or toward building wealth. I've worked with them for over two decades and they're the only Ramsey trusted health insurance advisors. So get clear on your options and talk to a real person who can help you make confident decisions about your health coverage. Go to health trust financial.com today. That's healthtrustfinancial.com. Student loan debt is an epidemic and defaulting on debt makes you feel even worse. But our question of the day sponsor why Refi refinances defaulted private student loans and builds a custom loan based on your ability to pay? You'll have a payment you can afford with a low fixed interest rate you couldn't get anywhere else. So go to yrefi.com today Ramsey that's the letter y r e f y.com Ramsey might not be in all states.

[Ken Coleman]

Today's question comes from Kate in Maryland. My daughter is a junior in high school and has no idea what she wants to do when she graduates. My husband and I love the idea of her owning her own business, but neither my husband nor I have experience in this. We both wish we had made different career decisions that would have given us more independence. Where can we research with her to get a better understanding and vision for this option? Or would you still recommend college vs real world experience? Okay, I'm going to put myself into this particular situation, say if this was my daughter, what would I do? And so because she's a junior, we would begin to identify areas of interest, not come up with a business idea. I think this could be very paralyzing for a youngster. It's paralyzing for a lot of people in their 30s and 40s because we know, Dave, from the data that 70% of Americans want to be self employed but only 6% are. So I'm speaking from data here. So what I would do with my daughter is we begin to identify areas of interest, in other words, people that she wants to help solutions. She gets excited about problems she wants to solve. And there's an industry. If there's a business, there's an industry. And so we want to get broad so that she gets some real interest and begins to see some areas of interest. At that point we're going to shadow I'm going to allow her to go have coffee, lunch with people that are in those industries or maybe run businesses in those industries. Shadow at work. If she can get shadow opportunities, all of this to begin to create a field of three or four of her most interesting options. At that point then we start to have the discussion is college is a degree the best decision or is it getting right into the workforce and working in an industry and give you an example to help clarify this some more. If this were a young man, and by the way, it's not limited to young men, but let's say she decides she wants to own a business in the trades.

[Dave Ramsey]

Okay.

[Ken Coleman]

That point then I want her shadowing folks that are working in those trades and getting a real world experience. The good, the bad, the ugly, the smelly everything. And at that point we determine whether or not she's really interested. And then the path is going to be to go to work and hustle and learn on the job and eventually you work your way into spinning off on your own and starting your own business. So that's a hard question to answer in such a short amount of time without back and forth, but that would be the advice that I would give because that's what I would do. These young people need to see it, touch it, experience it, smell it.

[Dave Ramsey]

Yes.

[Ken Coleman]

And then they can decide.

[Dave Ramsey]

Completely agree. Because Kate, you did not say she hasn't this extreme passion and apparent natural talent and bent towards X because you did not say that that would have led her towards a business. The people that we've talked to that are 18 or 19 or 21 years old that have had success and they call this show and they are really killing it. And we're all kind of aghast at how, how far ahead of this curve they are running their own thing. They almost always had a natural gift towards something. Technology is not unusual for a 19 year old today to be something that they would go, you know, they've been screwing around, writing code, messing around, building apps and all of a sudden they built an app and took off and around the business. Okay, or you know, whatever, that's fine. I mean that would be Michael Dell, that would be Bill Gates, both quit college and Steve Jobs. All three, all three companies were formed by college dropouts and so but they were super nerds with their eye exactly on what they wanted to do. There was no question. Instead you're asking a very generic thing. My husband and I always wish we were in business. So we wish our daughter would go into business, but none of us have a clue. Yeah, that no, don't go in business. Business is too hard. That's correct. Don't, don't, don't. Don't put us 18 year old, 20 year old out there with no education to go into business doing that. No. If she thinks or that in talking with her that she has got some entrepreneurial flair and wants to do a business someday Maybe in the future a great, you know, just get a business degree, get a degree in finance, a degree in marketing. You'll learn accounting, you'll learn statistics, you'll learn marketing, you'll learn strategic thought. I mean, you'll get some of these basic things in a good four year degree. That's what I have. And I use a lot of those classes I took 40 years ago every day running Ramsey, you know, it's a $300 million company. It's a dad. Good dad gum. Good thing I had a couple of accounting classes. Hello. You know, rather than just trying to figure that out with a high school accounting class. And so it's a good thing that I, you know, understand marketing at an academic level before I actually get neck deep in it and then try to figure out how it works out here in the real world too. So I would do that. If she thinks she's going to go that direction, combined with Ken's advice of really go in there and study, study, get, go visit these places. Quit talking about this stuff in the abstract.

[Ken Coleman]

Here's what we know about entrepreneurs.

[Dave Ramsey]

Business is very hard.

[Ken Coleman]

It is.

[Dave Ramsey]

And people that have never started a small business and run one have this romantic view. But there's a lot of dirt under the fingernails, boys and girls. I mean, there's a lot. It's long hours. It's the hardest boss you'll ever work for in your life. That guy's a dad gum slave driver. Yeah.

[Ken Coleman]

And to that point, the entrepreneurs that win are driven by deep, deep desire to solve a problem and they come up with a solution. That's the business is a solution and they're deeply passionate about it. That's what keeps them going. Because it is. You almost need that magnetic pull or.

[Dave Ramsey]

You'Re just going to quit. Because in air quotes I always wanted to work for myself. Yeah, you're not going to make it.

[Ken Coleman]

No, no chance.

[Dave Ramsey]

It's too tough. You're going to get your butt run over in the middle of the street, man. I mean, you're just going to be roadkill. And it's just too, I mean, because you put up with too much. You shovel so much manure, it's unbelievable. There's a pony in there somewhere. But you got to shovel the manure. I mean, it's real. And I'm not complaining and I'm not whining. I wouldn't. But I have a call for a certain thing. That's correct. And I've had two in my life. I mean, one on real estate and went Broke and then one doing this. And I could do the real estate tomorrow and still be okay. But obviously God called us to this right here, and I'm happy with that. But, yeah, I wouldn't put up with the BS that you. Nobody will. That's why we see business people quit all the time. It's why we see a chef who is good at cooking and nothing else has a failed restaurant. So our restaurants have the highest failure rate of almost any stinking business category because they think. Somebody thinks because they can cook or like cooking for their friends, that that makes them a restaurant owner. Now you gotta hire and fire people all day long. Restaurant has a 325% turnover ratio in a year. Means you have to hire three people to fill that one position during that year. So you're in the hiring business. You're in the firing business. You're in the food sourcing business, inventory. There's all this stuff that goes with running a business. It's not cooking.

[Ken Coleman]

That's right.

[Dave Ramsey]

And it blows a chef's mind. And they go, oh, God, I wish I'd never. Yeah, that's right. We all wish you'd never.

[Ken Coleman]

That is a great actual example of do I want to run a business that serves food or do I just want to cook food? Two very different paths, by the way. Both honorable, but there is a big distinction between the two. And that's the key.

[Dave Ramsey]

You know, it's even like when we're talking with entree leaders, these small businesses, and they're getting ready to promote their best salesperson to be sales manager. It's two different skills.

[Ken Coleman]

That's exactly right.

[Dave Ramsey]

You're. Managing salespeople is different than making sales. So one of them. Sometimes one of the worst things you can do is take your. Your best sell seller and turn them into a sales manager. Because they don't have that skill set. They're good at selling. They're not good at managing sales.

[Ken Coleman]

And don't forget, they may not enjoy it. They may enjoy the service. They enjoy the service of the customer. They don't enjoy the service of leading a team of people. Again, you lead a bunch of sales.

[Dave Ramsey]

People, like running a beauty parlor.

[Ken Coleman]

It's drama. Two very different job descriptions.

[Dave Ramsey]

So, you know, you need to get in there what it is. So that's a great question, Kate. And we'll have the team send out.

[Ken Coleman]

I love the student assessment would be great for them.

[Dave Ramsey]

Okay, perfect.

[Ken Coleman]

Because we've actually got that. And that's. A young person can take that and get a pretty good idea of what a current snapshot of what a professional job description of purpose would look like for them.

[Dave Ramsey]

And that can be a business. That's right. It might very well be killing that. But make sure you understand that, you know, business is not romantic. This is the Ramsay show.

[Caller]

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[Ken Coleman]

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[Dave Ramsey]

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[Ken Coleman]

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[Dave Ramsey]

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[Caller]

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[Ken Coleman]

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[Dave Ramsey]

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[Ken Coleman]

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[Dave Ramsey]

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[Dave Ramsey]

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[Ken Coleman]

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[Dave Ramsey]

Welcome back to the Ramsey show in the Fair Winds credit union studio. I'm Dave Ramsey. Your host Ken Coleman Ramsey, personality number one best selling author is my co host today Chris is in Wyoming. Hi Chris. How are you?

[Caller]

Good.

Yourself?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

I just, I just wanted to give you guys a call. I just, I mean kind of going through some struggles and with debt and I got fired from my job on Wednesday and.

[Dave Ramsey]

Whoa. So that sucks. What happened?

[Caller]

They, they gave me an evaluation and I guess I didn't score high enough and I, I think they fired me because of my hearing issues because I was, I was born partially deaf and I think they, that's part of the reason why they fired me because I couldn't understand things.

[Dave Ramsey]

And you're going to speak directly into your phone so you got muffled on me there. But you had trouble understanding things. What was the job?

[Caller]

Yeah, it was, I was working at a casino. I was doing surveillance and they just am kind of looking at cameras and answering phones and I think when I just wasn't understanding a lot of stuff that I was being told and they didn't tell me they fired me because of my hearing issues. But I kind of think that's what it was.

[Ken Coleman]

Well, does the. And the reason I'm asking this follow up is because this is going to inform maybe some advice we give you going forward. When they went through the evaluation, whether or not they told you that or not, did you agree that you weren't meeting their evaluation points?

[Caller]

Yeah, I do.

[Ken Coleman]

I do agree.

[Dave Ramsey]

Listen, you're not speaking directly into your phone again, honey. You have to do that is muffled.

[Caller]

Yeah. So, yeah, I do agree that I was. I was having a hard time understanding things that they were. The tasks that they were giving me.

[Dave Ramsey]

Okay.

[Ken Coleman]

Okay.

[Dave Ramsey]

And so your biggest crisis is you're unemployed?

[Caller]

Yeah, I'm unemployed and my wife can't work because she's. She got a. She tore her butt. She tore her femur back when she was in the military and she's using two canes and she hasn't worked for so long. And so it's just, it's been hard to try to take care of her, myself and our three kids. And are you aware of.

[Ken Coleman]

Are you aware of what kind of work that you can do where the hearing is not going to be that big of an issue?

[Caller]

For like 15, 20, 15 to 20 plus years? I was doing like physical work, like warehouse type work, because it really didn't involve a whole lot of. I mean, I started to hear things, but it wasn't as bad as, you know, having to, like, I wouldn't have to like answer phones or any type of thing like that. And so I've been trying to get back into that again. It's just been with winter hours coming up, it's just kind of been more harder to get into that again.

[Dave Ramsey]

How did you lose your hearing?

[Caller]

I was born with. I was born. It was genetic.

[Dave Ramsey]

Okay. Do you have hearing aids?

[Caller]

Yeah, I do. I went through the Wyoming workforce, but they're not working. They're working. They've been a big help. But even after I got the hearing aids with the casino, I was still having a hard time. So I try to do everything the best I can and I seem to still have a hard time hearing.

[Ken Coleman]

Well, the casino is a very noisy place and even with hearing aids, that can be a problem. Well, I'm worried about your location. It seems when you said winter hours that you have limited opportunities due to where you are. Is that what I'm understanding?

[Caller]

Yeah, I mean, I'm in here in Cheyenne and they usually when winter starts coming up, that's when they kind of, a lot of places, you know, cut back hours and because they're fully staffed and it's harder to get into places and.

[Dave Ramsey]

Sure.

[Ken Coleman]

How much money do you need to make? What's the bottom line that would just take care of you guys? Just your basic expenses. What do you need?

[Caller]

I mean, my rent. I mean, it's my rent, my electric. I don't have to worry about, like, gas or anything.

[Ken Coleman]

Give me a number. Do you got a number, A monthly number that you need to live?

[Caller]

And in all honesty, I mean, I honestly don't know. Can't really figure out her number. It's usually about, I think, like 3,000amonth. That's usually where all my bills are at because I got two vehicles and then, you know, my kids taking care of the expenses for them, too, and food and all that stuff.

[Dave Ramsey]

And you have two car payments.

[Caller]

Yeah, I have two car payments. I have. I have a. My truck payment, which is $740, and then my car payments, 360.

[Dave Ramsey]

I don't know what in the world planet you're on that you think you can afford a $700 truck payment.

[Caller]

When I was working with Walmart, I got fired from them the same year in January.

[Dave Ramsey]

Why did you get fired from Walmart?

[Caller]

Because of my attendance, because of the wife's medical issues with her leg and then my mental health. I, I was leaving a lot, and I was calling off a lot because my mental health. And I ended up. After I got fired, I ended up.

[Dave Ramsey]

What's the nature of your mental health problem?

[Caller]

Well, when my daughter was born, she.

[Dave Ramsey]

No, your mental health problem. What's the nature of your mental health problem?

[Caller]

I'm depressed.

[Dave Ramsey]

Okay. And is your wife on military disability?

[Caller]

No, she. She's been trying to fight with the VA for several years.

[Dave Ramsey]

And are you on any kind. Any kind of disability?

[Caller]

No, I'm not. I tried to get on Social Security, and they, they. They denied me because I finally got the job at the casino, and they denied me because. Yeah, I was making too much. And so I.

[Dave Ramsey]

That would, that would be true. That would be obvious. Yeah. Okay, so what we've got to do is we got to figure out a career where you can make some basic income. And, son, you got to sell your truck, a $780 truck. And this picture that you have painted for the last few minutes is insanity.

[Ken Coleman]

Nuts.

[Dave Ramsey]

So you got to get rid of the $780 payment, and you guys could go down to one car for that matter. Your wife doesn't work. She's on two canes. I don't think she needs to be driving a lot. So you got and then you're going to have to pick up work, doing a lot of other stuff until you can land something that's stable. Any good suggestions? Ken?

[Ken Coleman]

Well, the reason I went that direction of what have you done or what kind of work is because you're going to have to get back into that space. And what heard was a lot of limitations. But right now you can't accept limitations. I understand depression is real, that's a real thing. I get it. But you're going to have to fight through that because you are the person that this entire household is relying on. So yeah, manufacturing warehouse work, I'm showing up and I'm going to go back to Walmart and I'm going to say, hey, here's what happened to me. I'm going to power through it. I mean anything and everything right now, two and three jobs, you have got to get enough money that maybe seen, not maybe I'd see a therapist, I'd scrape enough money together where you get some help as a professional, can help you with some tools to power through the depression. And it's this is desperation time.

[Dave Ramsey]

Yeah, yeah, I'm sorry you're facing all this.

[Ken Coleman]

So sorry.

[Dave Ramsey]

I'm 100% sure we've got to get your income up and I'm 100% sure you need to sell your truck. And when you do those two things, you create a sustainable situation mathematically and that gives you the opportunity to work through the emotional struggles that you got. So keep it up dude. Keep pushing, keep fighting. You can do it. After the holidays a lot of people start feeling budget pressure and it's a wake up call to get intentional. So listen, don't fall for buy now, pay later cell phone plans that drag you back into debt. Boost Mobile keeps it simple with no contracts and no nonsense. Keep the phone you already own and pay just 25 bucks a month forever for unlimited data, talk and text. That's real long term value and real peace of mind. So budget like you mean it and go to boostmobile.comramsey today to make the switch. That's boostmobile.comramsey restrictions apply.

[Ken Coleman]

See boostmobile.comramsey for details.

[Dave Ramsey]

Thank you for joining us America. We're glad you are here. Ken Coleman Ramsey, personality number one best selling author of the book Paycheck to Purpose and his new work discovering or finding the work you're wired to do which comes with the get clear assessment to help you figure out what your strengths are and where you need to head with your whole career and money making endeavors. It's A great, great thing. It's just hit a bunch of. Bunch of bestseller things this week, as a matter of fact. Very cool. Hey. The average interest rate for a 15 year mortgage dropped from 6 to 5.6 this week. And the average of this week, I'm sorry, fell to 5.15, the lowest we've seen since February of 23. So almost 20 some odd months now since we've seen interest rate that low. So if you purchase a $423,000 house with a 20% down payment on a 15 year, the interest rate change is the difference now of about 3, $4,000 a year is what it would save you. So, yeah, if you're financially ready, if you're out of debt, you have your down payment ready and you have your emergency fund in place. We're huge on the real estate market and this is the time to do it. It's also a great time to sell because there's a shortage of inventory. So it's kind of a weird market in that way. But you need a good, strong real estate agent in your corner that knows what the flip they're doing. High protein, high octane. So go to ramseysolutions.com agent and you can find the real estate agent. That's Ramsey trusted that we have vetted in your area. So there we go. Open phones at 888-825-5225. Nicole is in Jacksonville. Hi, Nicole. How are you?

[Caller]

Good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Okay, so me and my husband are about to bring a baby into the world in January next year.

[Dave Ramsey]

And congratulations.

[Caller]

Thank you. He's had this credit card with his mom that he's been having for like, the past basically a year and a half. But she basically has, like, joint ownership of his, like, account and stuff like that because he's in the military. So, like, when he first got in, he was like, oh, well, you're gonna oversee everything. Just make sure, like, my bills are paid and stuff like that. But she opened up her credit card and she's ran up like $14,000 since then. And every time I try to talk to him about it, like, hey, like, what's going on with this? Like, you know, is she gonna take care of it now that we're bringing a baby into the world? I'm concerned. And like, every time she'll ask him about it, like, she completely, like, gets angry or upset and cries because she has lupus. And she has, like, a lot of medical bills too. So we're not really sure.

[Dave Ramsey]

How long have you been married?

[Caller]

We've been married for a year and a half.

[Dave Ramsey]

Okay, and what does she make, what does he make and what do you make?

[Caller]

He makes like 55, 000 a year. And me, I'm a student, so I'm still in school and everything, so I work part time.

[Dave Ramsey]

How old are you? How old are you too?

[Caller]

I'm 22 and he's 23.

[Dave Ramsey]

Okay, here's the thing. Stop. You don't have a mother in law problem. You have a husband problem. Okay? So hubby has got to decide now that there's a new woman in his life that's not his mother. When you, in the old days, people would say things like, when you get married, you leave your parents and cleave to your spouse. Leaving cleave, we called it. Okay? And there's a boundary drawn, There's a new household has been established a year and a half ago now it has a baby entering it. Okay? And we're not going to blame any of this on the baby. We're going to blame all of this on your husband. The day you all got married, it was his job as a man to separate all of his accounts from his mother. This is very boyish, not manly behavior that he's engaging in. And so you, if I'm in your shoes, I'm gonna sit down very calmly. And I don't care if his mom cries. I'm sorry. And I don't care. I'm sorry. She has lupus, but the reason she's crying is because she's ashamed and because it works on her little boy. So we're going to have to help your husband run down to Walmart and pick up a backbone. They're on aisle three. And then he's going to walk in there very calmly and gently and say, mom, now that I'm married and I have my own family, we're not going to have any more joint accounts. So everything is being closed today. And you're going to reopen your own accounts. Mom. And you need to pay this $14,000 you ran up on this credit card, okay? And if she doesn't, you'll have to because it's got your husband's name on it. This is a mistake that he has made and it may cost him and you $14,000. Because I got a feeling this woman's not going to pay this. Don't you?

[Caller]

Yeah.

[Dave Ramsey]

Yeah. And you're not to be involved at all. You'll become the wicked, you'll become the wicked daughter in law. It'll be all your fault because this woman is a travel agent for guilt trips. Okay?

[Caller]

Yeah. Every time I like, try to, like, talk to her about.

[Dave Ramsey]

Nope, nope, nope, no. Don't you ever say a word to her about this again. But your husband, he needs to throw his shoulders back and become a man today. Today. This is weak and fearful behavior. He needs to become courageous, bold, gentle with his mom. There's no reason to be mean to her. He's the one entered into this arrangement. But it does need to be very thorough and complete immediately. It's absurd that a man that is married and has a baby on the way has joint accounts with his mommy. That's ridiculous. Okay, you can play this back for him if you want. He needs to square. Yeah, he needs to square his shoulders and walk in there. I don't want him to be unkind to his mom, but it was his duty the week before you got married to separate everything. When my kids were getting married, we sat down two weeks before. I transferred every single mutual fund that was theirs, every single checking account or piece of savings that was theirs, completely out of our name. And if they went and did something stupid with it the next day, that's on them. Because they're now what's known as grown up adults. And so it's not my job anymore to manage them. They are now free agents. They're grown people. And you don't even have to get married to do that. But that happened to be the one. We made sure that everything was final because I did not want to be interfering with my daughters in law, sons in law, just like Nicole situation. This is happening more and more.

[Ken Coleman]

Yeah. The emotional umbilical cord needs to be cut. And this is the reason why is because the lupus. She's my mom. She did this, she's done that. And you cannot think rationally when you are thinking emotionally. You cannot have a rational thought at the same time that you have an emotional thought and this tied together. He's never going to act rational until the clear cut has happened. And I really would recommend that he watch this so that he realizes you're not the bad person and you don't.

[Dave Ramsey]

Be pissed if somebody be pissed at me. It's like a spiritual gift I have. I'm fine with that.

[Ken Coleman]

Yeah, cut the, the cord.

[Dave Ramsey]

There's entire Reddit pages devoted to doing that so you can. And comment sections of everything.

[Ken Coleman]

By the way. This is only going to get worse. I want the young man every day.

[Dave Ramsey]

This goes on every day this goes on. And we're not even going to blame this on the baby. Oh, no, not the baby. This is something should have been done before there was a baby.

[Ken Coleman]

Well, I'll tell you, it's the big baby. I'm blaming it on the big baby. Not the baby in the womb. The baby who has yet to mature.

[Dave Ramsey]

Yeah.

[Ken Coleman]

And by the way, mom enabled this, so there's enough blame to go.

[Dave Ramsey]

She didn't able it. She manipulated it. She wanted it. She likes this.

[Ken Coleman]

He was a mama's boy. To go to military and say, mom, pay my bills.

[Dave Ramsey]

Yep. Yep.

[Ken Coleman]

I'm not blaming that all on him.

[Dave Ramsey]

Yep.

[Ken Coleman]

We gotta let these kids fly, folks. Kick them out of the nest. That's what the birds do.

[Dave Ramsey]

That's.

[Ken Coleman]

This is a national problem.

[Dave Ramsey]

To your point, we're seeing a real problem. It's a real problem. This is the Ramsay show.

[Caller]

Sam.

[Dave Ramsey]

I love entrepreneurs. Don't forget, guys. I started my company on a card table myself. So I know what it's like to have people counting on you, your team, your family, not to mention your customers. And when you're the one signing the paychecks, you can't afford to fly blind. But I'll be honest. Early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team, just fix it. And they did. We got Netsuite. That was years ago and we've never looked back. See, netsuite isn't just for tech giants. It's built for growing businesses like yours. Over 43,000 businesses already run on NetSuite, including a lot that started just like you. And now with built in AI, NetSuite is helping them even more. It's one system connected to every part of your business. For real time insights, not guesswork. NetSuite AI flags, inventory issues, cash flow risks, even supplier delays before they become problems. So you can trust the data, stop wasting time, and make the right decisions faster. Take a free product tour [e-mail] Ramsey. That's netsuite.com Ramsey. Ken Coleman, Ramsey personality, is my co host today. Thank you for joining us, America. Danelle is with us in Salt Lake City. Hi, Danelle, how are you?

[Caller]

I'm good, thank you. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

I have a little dilemma that we're trying to figure out what we need to do. I have a 2012 Hyundai Elantra and it's got over 200,000 miles on it. Around the end of October, I was backing up out of a parking spot and a guy behind me backed into my car. And it didn't ruin my car, so I couldn't drive it, but his insurance totaled my car.

[Dave Ramsey]

Right.

[Caller]

So now.

Yeah, I mean, you're driving a hooptie.

[Dave Ramsey]

And you're getting a check.

[Caller]

Yeah, I. Yeah, I can get a check for it for sure. They will. I can get 3745 and keep it. And they'll. I'll have to get a salvage tile.

[Dave Ramsey]

No.

[Caller]

Or they'll be 45. 38.

[Dave Ramsey]

No, you take the full pay, give them the car, go get you a car.

[Caller]

Okay.

[Dave Ramsey]

If the car was in good shape. If the car was in good shape. And it's 200,000. Mile 2012 Elantra. What's it actually worth? Have you looked it up?

[Caller]

Yeah, it's probably under five.

[Dave Ramsey]

Well, that's what they're giving you is under five.

[Caller]

Yeah, yeah.

[Dave Ramsey]

I want you to make sure that what they're giving you is the actual value of the car.

[Caller]

Well, the 45 is what they would give me, and that's what I believe.

[Dave Ramsey]

No, honey, they're going to give you the value of the car. It's the law. They may not have understood that yet. You may have to help them with that. Yeah, but they're supposed to give you the value of the car. The guy tore your car up, so didn't take much to total this car, but it's okay. Cool. I'm glad. So I want you guys. You said we. Are you married?

[Caller]

Uh huh.

[Dave Ramsey]

Okay, you guys jump on the computer before you accept the offer and find out from Kelley Blue Book what the retail value of that car is and enter it with 200,000 miles, no damage, and the attributes of that car, the accessories it has and so forth. And then look on stuff like trader.com and find some that are for sale that look similar in mileage. And if you find out that car is worth 5200, you call this insurance company up and say, you need to pay me 5,200. And here's the appraisal from Kelley Blue book. And here's three cars on Trader.com that look the same. All these things say 5200, not 4500. And they guy will go, okay.

[Caller]

All right.

[Dave Ramsey]

Who's the insurance company?

[Caller]

Bear River Mutual.

[Dave Ramsey]

What?

[Caller]

Say it again, say it again. Bear River.

[Dave Ramsey]

That's the actual insurance company. Not. They wrote the policy. Do what? Bear River Mutual. Okay. I just don't know that One. Okay. All right. Well, because sometimes I know the reputation. Like, if it's State Farm, you can pretty much be assured they're trying to screw you. Okay.

[Caller]

Yeah.

[Dave Ramsey]

That's like their modus operandi. Okay. I've been hit by State Farm people twice, and it's been a problem both times. Okay. They're just a pain in the butt. And see, it cost. It cost them a lot. Because I just said that. So. But anyway, the. Anyway, so, yeah, just. Just verify that the actual cost value of the car. I'm not trying to rip them off. I want them to pay you what you're due. That's all. Yeah, it's an honest transaction in it. I'm sorry.

[Caller]

I mean, with the ding in the car.

[Dave Ramsey]

No, darling, there wasn't a ding in the car before he hit it.

[Caller]

Oh, okay.

[Dave Ramsey]

Before he hit it, what was the car worth?

[Caller]

Yeah. Okay.

[Dave Ramsey]

Because that's what they owe you. That's the market value of the car. Because you got to take the cash and go buy that exact car on trader.com from somebody else. That's what you're going to have to pay for it. Yeah, that's what they should give you. They should replace your car. No, you don't keep your car.

[Caller]

Okay, I have a question for you then.

[Dave Ramsey]

Is this car was almost dead before this guy put a bullet in it, let it die?

[Caller]

Yeah, it's true. It's true. Okay, so I have. I have listened to you for years, and I just get sick to my stomach now thinking about even taking a loan out on a vehicle.

[Dave Ramsey]

Well, don't. We buy a $5,000 car.

[Caller]

Put aside. Pardon?

[Dave Ramsey]

Buy a $5,000 car.

[Caller]

Okay.

[Dave Ramsey]

You have $5,000. You were driving a $5,000 car before this happened.

[Caller]

True.

[Dave Ramsey]

So it was doing. It was perfectly good with your life or good enough for now.

[Ken Coleman]

How much money do you have set aside and is that earmarked for something else or was it for a car replacement?

[Caller]

It's. It's to go towards a car replacement.

[Ken Coleman]

How much you got?

[Caller]

7,000.

[Ken Coleman]

7,000.

[Dave Ramsey]

So then you have that. That's your car fund.

[Caller]

Yeah.

[Dave Ramsey]

Okay. Well, then you can buy a $12,000 car. Yeah.

[Caller]

Okay.

[Dave Ramsey]

Yeah.

[Caller]

All right. I just. My husband wants me to have a car that he knows we can depend.

[Dave Ramsey]

On, and he's like, where was this husband before you got hit? In the parking lot.

[Caller]

He was sitting next to me.

[Dave Ramsey]

I know, I know. But you see what I'm saying? He wasn't. He wasn't whining about you having something that was dependable when you're driving this $5,000 hoopty. You were saving up to get out of the hooptie. Now you sold the hooptie. You just sold it to an insurance company.

[Caller]

Yep, you're right.

[Ken Coleman]

Lot of $12,000 cars that you can rely on.

[Dave Ramsey]

Excellent vehicles for 12 grand. Excellent. A car that'll do anything. It'll do double backflips. You can get great cars for 12 grand. Yes. The best value in the market is 10 to 15,000. It's the best buy in the car market. You get the most bang for your buck and it's a great. You can get a great vehicle for that. That'll last you for a long time. Yes, yes, yes, yes, yes. There's no reason for you to go in debt, hun. It's just. It was an event. Thank God nobody was hurt. It's a little parking lot ding. And it's just sad that your car. The parking lot ding. I never heard anybody got totaled in the park in the Kroger parking lot. But there you go. So Bump, you're totaled.

[Ken Coleman]

Yeah. I mean that. I was gonna say that was quite a incident. He must have been on his way to the game with the wings and the chips and salsa.

[Dave Ramsey]

He was in a hurry. Something going on? Amber's in Spokane. Amber, welcome to the Ramsey show.

[Caller]

Thank you. I just have a quick question. Actually two part question. I have an 18 year old son. He's still in high school. He will be 19 next year graduating and he is planning on opening his own business. Doing what with his landscaping? With his own money.

[Dave Ramsey]

Good.

[Caller]

Not gonna. He's very smart as money. He doesn't have any debt. He won't get a credit card. He only uses what he has.

Mm.

But I was trying to explain to him the other day that he can do it with a zero credit score. And he. And I. I am also confused a little bit too, but I know it's possible. So he doesn't want to take out any loans. He's been.

[Dave Ramsey]

He doesn't need a credit score. So why do you need a credit score?

[Caller]

I think he's more worried about if something comes up where he has to.

[Dave Ramsey]

Borrow money. Borrow.

[Caller]

Borrow to. Yeah. If he has to get a bigger machine or.

[Dave Ramsey]

Well, that already is going to come up. 100% of the people that buy machines, buy too many of them.

[Caller]

Well, he has a plan to buy used and cash.

[Dave Ramsey]

And if something comes up, he'll buy used and cash. He does not need a credit score. Do not use debt as your backstop in case of emergencies in business because you will live in debt the rest of your life. Because 100% of. There's three rules in business. It takes twice as long as you think, it costs twice as much as you think, and you're not the exception. Those are the three rules of business.

[Caller]

The nice thing is that he understands all three of those rules and he.

[Dave Ramsey]

Then he doesn't need a credit score.

[Caller]

Okay. The other question is I have. Is how I've been trying to get him to listen to your show or read your book or. And he's 18, I'll give him that because he's just, he's still in that mentality stage where he's 18 and is there something I don't want to push too hard so that he doesn't do it all together, but is there? I know you have. Have books and programs and stuff like that, but I've already bought those and he, he wasn't interested in it. Is it something that may come along later on when he's going through.

[Dave Ramsey]

I guess, I mean, the only thing I can tell you is the only, only good I've ever been able to do with my kids once they turned 18 and beyond was I tried to try my best to not use my dad voice because once I do, they quit listening. I have to use my persuasive uncle voice. Like I'm their uncle that loves them and has no power because I am that person that has no power once they're 18. So you've been using your mom voice. You need to listen to that. Dave, that won't work. He won't. He turned that off immediately. Use your friend voice and maybe, maybe he'll pick it up. Probably not, but maybe he will. This is the Ramsey Show. If collectors are blowing up your phone every day and you're living in constant fear of the next call, you're not living. You're surviving. You don't need more noise or more stress. You need help you can trust. That's why I recommend Guardian Litigation Group. Guardian isn't a call center reading from a script. They're real attorneys who can step into the courtroom and fight back when creditors try to sue you. Debt settlement isn't glamorous. It's not the preferred path. I'd still rather see you pay it off the old fashioned way. But if you're overwhelmed, out of options, and trying to avoid bankruptcy, Guardian can help quiet the chaos and give you a real way forward. With no upfront fees, their attorneys have helped more than 55,000 people settle over $600 million in debt. And when the noise stops, you can breathe again. To learn more, go to guardianlit.com Ramsey that's Guard L I T.com Ramsey Attorney.

[Ken Coleman]

Advertising results may vary and no specific outcome is guaranteed.

[Dave Ramsey]

Hey guys, we could use your help. It helps us a bunch. And we know you're doing it because we're seeing the numbers or incredible, incredible. If you subscribe to the show on the platform that you're doing or follow the show on the platform that you're listening or watching, whether it's YouTube or Spotify or, you know, Apple Podcast, Google Play, whatever it is, just click follow or subscribe. It makes a big difference. Also share the show. Some of these things have a share button where you can share it. Maybe you're just listening on talk radio. Tell people where you're listening. You know, I'm in Phoenix. I listen on ktar, you know, and the Ramsey show's on there and it's changed my life. Tell people. Tell people when you read a good book. Tell people when you see a good movie. Tell people when you hear a good show, a good podcast, a good YouTube show, whatever it is, spread the word. And we know you're doing it because our numbers are up astronomically and we appreciate it. But when you do all that, it also affects all of those platforms, algorithms, and the way people are behaving on there affects whether they push the show out forward in front of people that don't even know they're searching for it. And so it, it changes everything when you do that, guys. It's a big deal. Thank you very, very much. Even the five star reviews, those help a bunch too. Thank you. William is with us in Providence, Rhode Island. Hi, William, how are you?

[Caller]

Hey, guys, I'm great. Thanks for taking my call. I appreciate it.

[Dave Ramsey]

Sure. How can we help?

[Caller]

So I'm in the military and I just got married two months ago.

[Dave Ramsey]

Congratulations.

[Caller]

About four months ago. Thanks, man. I appreciate it. I discovered you guys four months ago. Life has been excellent. So we're in the process of moving and we're paying off my wife's student loan debt, about $28,000. And we figure out we're going to be moving to Hawaii in March. Looking at housing prices over there, it's going to be pretty insane, at least to do like first month's rent, security deposit, everything like that. So I'm looking at your advice on how to approach that. Taking a pause at baby step two and how to move forward there.

[Dave Ramsey]

It's not really a pause on baby Step two, it's just a pause on the whole thing because you've got a, you know, something staring. You're staring. You know, you're staring at this thing in front of you, and you've got to deal with it. Right. And so, you know what I would do is put a detailed number on the march move, stop everything, and pile up that number, because it's coming. It's not. If it's just. There's no question about the probability of it. And so. And then when you've got that number, then push play, set that number to the side, push play, and then start working it again.

[Caller]

Okay.

[Dave Ramsey]

Yeah. That's exactly how you do it. So. So which branch are you in?

[Caller]

I'm in the Navy.

[Dave Ramsey]

Okay.

[Caller]

Yeah.

[Dave Ramsey]

Thank you for your service, sir. We appreciate you guys and.

[Caller]

Well, I appreciate you guys and.

[Dave Ramsey]

How old are you two?

[Caller]

28. My wife is 26.

[Dave Ramsey]

Perfect. Yeah. Okay. Have you been through Financial Peace University yet?

[Caller]

No, sir. We've. We've been just kind of listening to the show and. And making a go at it.

[Dave Ramsey]

We're going to give that to you as a belated wedding gift. Two months into my wedding, I wish. Two months into my marriage, I wish somebody had shown me this stuff. My life would have been completely different. In a good way. So. Yeah. And I got a pretty good life. But. Yeah. So anyway, hang on. Christian's going to pick up. We'll get you signed up for Financial Peace University because Hawaii is expensive. Yeah. You need to.

[Ken Coleman]

And that's the truth. Dave, I got to ask a quick question, because this is. I'm curious to know your take on this. If I was in this situation now he's in the military, so he may not be able to do anything outside of his military service, but if his wife is not working outside of the home, or even if she is, I'm the kind of guy that, if I were in that position in the baby step, certainly in baby step two, and I had an expense like that that was coming, and we knew it was going to be a chunk, so let's just say it was. I'll make this up. For example, purpose. I had to come up with $5,000 for something in March. I'm the kind of guy that's going to go crazy trying to make extra money and fund that 5,000 above and beyond what I'm doing out of my normal budget towards the baby steps. Do you.

[Dave Ramsey]

Do you.

[Ken Coleman]

Does that bother you?

[Dave Ramsey]

Is that's an okay thing? The thing is, it works exactly the same way. If you Just push stop.

[Ken Coleman]

That's true.

[Dave Ramsey]

And then go crazy, right? Pile it up that much.

[Ken Coleman]

But I'm the guy that hates losing.

[Dave Ramsey]

The progress put, you know, but if you pile it up twice as fast, right, because you're not staying in play mode. You push pause, then you boom, you're back at it. And mathematically, you'll end up in about the same place. And. But you're right, it does. It does light a fire under you to get it done quick. Jack is in Los Angeles. Hey, Jack. How are you?

[Caller]

I'm good. How are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

My fiance and I are both 25 years old. We're getting married two months from now, and we're, of course, looking to combine finances. Not sure the best way to go about it on a couple fronts. One, should we be waiting until we're married? Two, we both do have credit cards. We both, as of last month, are debt free. But we're wondering, should we be keeping them? Should we get rid of them? We're worried about, you know, canceling them, impacting our credit scores as we look to buy a house. So hoping to get your advice on all of that.

[Dave Ramsey]

Okay. You don't combine finances until you're married.

[Caller]

Okay.

[Dave Ramsey]

And after you're married, then, yes, you combine them because the preacher will say, and now you are one. And that's what that means until then. You've got all kinds of issues when you combine things that can happen. If something terrible happened before the wedding, you get yourself into a mess. So we just wait until then. As far as keeping your credit cards open, the best thing I know to do is cut them up and close everything and have zero balances. And if you have no active accounts going, it takes about six months for your credit score to just disappear. What you don't want is a medium credit score. You either want a very high one or a no credit score. When you're going for a mortgage, no credit score sets you up for manual underwriting with someone like Churchill Mortgage, our team that we've endorsed for mortgages for almost 30 years now. And they can help you do a manual underwriting with zero credit score. But you don't want to. You don't want to be in no man's land in the middle. And that's what will happen if you keep a bunch of stuff open with zero balances. Because FICO algorithm is built to where it wants you to be in debt. To drive an 800 credit score, you have to get in debt and stay in debt. And pay it regularly. I pay my credit cards off every month or I don't use them at all. And they're open will damage your credit score. So, so will closing them will damage your credit score. But closing them is the path to get to zero. And that's where I would recommend you go, is to zero. And it's okay to not buy a house immediately, by the way. It's going to take about six months for this to happen. So. Six months. Six months from the time you're married, you both close all accounts, you have zero balances, zero activity of any kind on anything that's reporting to fico. You will disappear, you'll fall off the grid, which is what you're trying to do here. And you know, that's the goal. And we recommend in general young couples getting married that they wait a year to buy a house. It takes about a year of marriage to know how close to your mother in law to buy. You got to get to know each other. Okay. And you know, you've been married 20 minutes, you're going to buy a different house then than you will when you've been married 20 months. It's a different property you're going to sign up for. And so just take your time. You got the rest of your life. You're going to be okay. I don't want you to take 10 years, but you can take a few months. And during that time you have the opportunity for the credit score to go away. Yeah.

[Ken Coleman]

You know, I'm thinking back to when Stacy and I got married and this whole question. We were walking through premarital counseling. Both of our dads were pastors and so they were, you know, really driving home the point that you made. Keep everything separate. Separate, of course. But it was us trying to clean everything up. And Stacy had some debt and we worked really hard to help her. And she, she went after it and to enter into marriage with. And we had a little debt. I had a little bit of student loans left and she had a little bit left. And then we knocked them out in that first couple years. But it was such a big deal for us to, in the first 12 months, just learn how each other handled money. You know what I mean?

[Dave Ramsey]

How you handle life, there's that too.

[Ken Coleman]

But it's like to make a big purchase decision like that and strap yourself into a mortgage like that without kind of, as you said, experiencing marriage and the way we viewed Money, that first 12 months for us was really eye opening and we had to learn how to get on the Same page?

[Dave Ramsey]

Yeah, it was for my wife, Sharon. She realized she'd made it here. Huge mistake.

[Ken Coleman]

Well, Stacy as well. Poor woman.

[Dave Ramsey]

They have the patience of Joe. Thought she married Sir Galahad. Turns out it was Goober.

[Ken Coleman]

Right? I resemble that.

[Dave Ramsey]

This is the Ramsay Show. How many times have you started January saying, this is the year I'm finally going to get my money under control. But then months go by and you still feel broke. You work too hard to keep living like that. Look, there's only one way to move the needle on your finances this year. You've got to have a plan. So start by downloading EveryDollar. EveryDollar is way more than our world class budgeting app. In 15 minutes, we'll build you a personalized plan to free up extra margin in your budget and use it to beat debt and build wealth. You'll find thousands of dollars on average just the first day. And you'll get new steps and new lessons every day that help you stay on track and create unstoppable momentum. Don't waste one more day feeling broke and stressed. Get your plan in just 15 minutes by downloading everydollar for free today. Welcome back to the Ramsey show in the Fair Winds Credit Union studio with Ken Coleman, number one bestselling author and host of the front row seat as my co host. I'm Dave Ramsey. Ryan is in Nashville. Hey, Ryan, how are you?

[Caller]

Good, Dave. How you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Well, had a question about retirement and 401ks. I am new into a Roth IRA. I'll be 50 next year and I can only contribute so much to that. And on my wife's 401k, we're maxing out what she can do a year on that. And then there's a rollover IRA from previous employment that we have. So we've got the three things working for us. But I can only contribute, you know, just that, 7,000 a year. And I would just like to know what you think other ways for me to try to make my money work for me down the road so I can have more retirement.

[Dave Ramsey]

Yeah, you can bump it to $8,000 at $50,000. And you can also do a spousal Roth for your wife as well. Are you doing both of those?

[Caller]

So we can do that if she has a 401 plus she has a rollover IRA.

[Dave Ramsey]

Yes.

[Caller]

What's that called?

[Dave Ramsey]

I'm sorry, just a Roth IRA. She can just do a Roth. She can do one too.

[Caller]

She can do a Roth.

[Dave Ramsey]

Yep. Even if she's not working. She could do one, but she's working in this case. So make sure. Is her 401K a Roth?

[Caller]

No, I don't believe. Well, yes, it is. It is. Okay.

[Dave Ramsey]

All right. Because if they match, the portion they match is not Roth. But make sure it's not traditional. Is the rollover. Is the rollover ira? Has it been converted to Roth?

[Caller]

I don't think it's been converted. It's just a rollover.

[Dave Ramsey]

Okay. If you convert it, it'll make the taxes on the amount come due. What's the amount in there?

[Caller]

The amount on the rollover currently is probably about 75.

[Dave Ramsey]

Okay. So you would have about 15 or $20,000 in taxes. Probably 15 if you get it. So if you got an extra 15 to invest in retirement, I would roll that to a Roth and pay that 15 in taxes and call that investing. Here's why. Because from this point forward, it will grow completely tax free.

[Caller]

Okay?

[Dave Ramsey]

So that paying those taxes now is like investing into a retirement. So if you're looking for more money to throw at something, the first thing is you bump them to eight. You do a spousal. Spousal. Make sure her 401k is Roth, if it's not already. And then take that rollover and, you know, talk to your tax person. Figure out what your taxes are going to be before you do it. Make sure you've got that much in extra cash to pay your tax bill next year when the April rolls around, because you're going to have an extra whatever it is, 15 grand or so on that. And then roll that 75, because that 75 in seven years will be 150, and in seven more years it'll be 300. And in seven more years will be 600. And all of that will be tax free. If it's Roth, it won't be the way it is now. It's going to grow and all of it be taxable at ordinary income. So you do want to move that at some point. But if you're looking for extra ways to put money towards retirement, that's the ways you can do it. Matt's in Tennessee. Hey, Matt, how are you?

[Caller]

I'm doing great, guys. I'm so excited to be on the show. Thanks for taking my call.

[Dave Ramsey]

My pleasure. How can we help?

[Caller]

Well, my wife and I have been weighing the decision of making her a stay at home mom. And I just want to make sure we're not letting emotion blind us from making a bad decision financially.

[Dave Ramsey]

Cool. Good for you. How many babies you Got.

[Caller]

We have two. They're both under three.

[Dave Ramsey]

Awesome. You got your hands full. Never a quiet moment at your house. Yes. Okay, so, yeah, it's great. I just kept the grandbabies last week that Sharon and I did that are that age and say I know what I'm talking about for just a moment there. But I can hand them back when they're broke. You can't. So this one's got something wrong with it. You don't need to work on this one. Yeah, but the. Anyway. What does she make?

[Caller]

She makes 95 gross.

[Dave Ramsey]

What do you make?

[Caller]

I make. I'll be on track to make over 150.

[Dave Ramsey]

Okay, cool. If you want to be really, really sure. An easy way to do it would be just live on your check for three months and bankers.

[Caller]

Yes, sir. We've been doing that.

[Dave Ramsey]

Oh, you have? Okay. I mean, minus daycare. If you got daycare, you could take daycare out of hers, but because you won't have that. Yes, but if you just practice. So you've already proven to yourself you can do this?

[Caller]

I guess so. But I mean, I guess we're just a little nervous to take that leap of faith, you know?

[Dave Ramsey]

It's not a leap of faith. You've proven it. It's a step. It's a step. It's not a leap.

[Caller]

Yes, sir.

[Dave Ramsey]

How much margin do you have? A leap is. I have no idea. And I've never even looked at the math. That's a leap.

[Caller]

This is true.

[Dave Ramsey]

Yeah. So you're done. Great, man. So what does she do for a living?

[Caller]

She's a nurse auditor for Humana.

[Dave Ramsey]

Is she a nurse by trade?

[Caller]

Yes, sir. Okay.

[Dave Ramsey]

I think Ken and I would both recommend that she do enough of something to keep her certs alive while she's at home.

[Caller]

Yeah, we both talked about that as well. We want to keep her. Her license up to date.

[Dave Ramsey]

Absolutely, absolutely. And you'll be amazed at what she could pick up as just little side things here or there that make a lot of money. She's got like the perfect career to do what you're talking about doing.

[Caller]

I couldn't agree more.

[Dave Ramsey]

I mean, she could pick up. If y' all got in a pinch or something, she could pick up weekends in the. In the ER and make almost as much as you make it.

[Ken Coleman]

Now.

[Caller]

This is true.

[Dave Ramsey]

Be very uncomfortable. And I'm not recommending doing that. And you don't have to because you've already proven we can live on your income. So. Yeah, just do it, man. Do it. This is why you manage money to get to live the life you want to live and you guys want her to be home and she's doing nothing wrong and everything right by doing that.

[Caller]

Yeah.

[Ken Coleman]

My question is, as Dave was walking you through this, you still seemed unsure. Is that because you're worried about some big giant expense coming out of nowhere from the giant in the sky or you are too tight on just your income?

[Caller]

No, that's a good question. We're not too tight on my income. What makes me nervous, Ken, is I started this job in June and it's a phenomenal job. It provides very well. It's given us a great financial bump. I guess it just makes me nervous to solely rely on on my job. Hadn't been being in it for such a short period of time.

[Dave Ramsey]

What do you do?

[Caller]

I'm in medical sales.

[Dave Ramsey]

Oh, dude. Yeah. You land another one, you know, land you can land backwards on your head and make 150 in that. In the next job. If these people lose their minds, you can get another job doing this. Once you've done medical sales, you're so qualified, it's unbelievable. You both have selected excellent careers. You'll be making 250 in three years. Dude.

[Caller]

Yes, sir. If everything goes well and I stay on plan, I should, I should track to make over 200.

[Dave Ramsey]

Yeah, absolutely.

[Ken Coleman]

Well, the good thing coming decision like this is you're going to be extra motivated and I appreciate you sharing the fear and I, I didn't need to know. I wanted you to hear yourself say it. And so what you need to do now is go. Okay? If this makes me a little nervous, is there any evidence that it should make me nervous? And in this case, the answer is no. And then today's point, you can crush it, man. So go crush it.

[Dave Ramsey]

Yeah.

[Ken Coleman]

And here's the other thing. You guys can decide, okay? We're going to stack up a little extra money. Just a little rest, easy money. No, we're not saying you have to do that, but you can to kind of ease yourself into this. You guys get to decide how and.

[Dave Ramsey]

When you make this transition and everything goes sideways. She walks down there and picks up a nursing job. I mean, if you lost your job, she picks up a nursing job. Y' all can eat. It's okay. It's not, it's not like it's permanent. You keep those certs though. Keep, keep everything up to date. Ken Coleman, Ramsey personality, is my co host today. He's the number one best selling author and host of the Ken Coleman show on the Ramsey Networks. And one of his best selling books is Find the work you're wired to do. It's his latest bestseller. Included in it is the get clear career assessment that we've sold almost 100,000 of. And it goes with the book for free. So not only do you get the assessment, you get the book to teach you how to read the assessment and what to take away from it. So be sure and pick that [e-mail] Jack is in New York. Hi, Jack. Welcome to the Ramsey Show.

[Caller]

Well, thank you very much, Dave. How are you today?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Well, I'm at the age now, mid-50s.

To where you want to get to.

Be conservative with your investments. However, for retirement. However, I don't have a retirement because of life choices that I've had to make throughout the years. So now that I'm finally in a financial position to where I can start making investments, I'm afraid to make liberal investments, to make money, to actually have a retirement. Because I'm at that age to be conservative. So I really don't know what to do. And I'll help you with this.

[Dave Ramsey]

You're not at the age to be conservative. I don't know who told you that, but they were wrong.

[Caller]

Well, I don't have that many years left to live.

[Dave Ramsey]

You have plenty of time. You're only 50. Okay, I'm not, I'm not conservatively investing and I'm 63. So I'm investing in good growth stock mutual funds that are growing like a weed. And you need to be. You're broke.

[Caller]

That's. Well, I'm not broke, but I had no retirement whatsoever.

[Dave Ramsey]

Well, that's, I mean, what, how much do you have? How much money do you have?

[Caller]

I got about 20k in savings.

[Dave Ramsey]

Okay, well, you're broke. I mean for 50, for 50 years old, going into retirement, that would scare the crap out of me. You need like 250. Right. Moving on. And so I'm not trying to scare you. I don't want you to panic, but you do need to get with it, as you said, and you recognize that. That's why you called. So what I would do is this. The thing I have figured out is there's two things that we are afraid of. And fear is a positive thing in these situations. Number one thing we're afraid of is something we don't understand. So the first time you sat behind the wheel of a car, I distinctly remember I was 12 and dad said, move the car around back. I left no Gravel in the driveway. No one told me you weren't supposed to press down on the accelerator all the way to the floor. And so I didn't because I didn't know what I was doing. So driving a car, I didn't know how to do it. I was afraid. And I was really afraid after I screwed it up, right? But now we all have been driving cars for decades and we drive and don't think anything about it. It's like muscle memory. So you learn how to do the thing and you're no longer afraid of it. The second thing you're afraid of is something that will legitimately hurt you. Standing in the middle of the interstate, you should be afraid an 18 wheeler is going to turn you into a of bunch bug, right? And so yeah, that's a bear is standing in front of you. You should be afraid. That's a good thing. But the other is just you're afraid because you don't know how. And that's the investing thing. That's wisdom. But it's something that can be overcome. I don't want to overcome my fear of bears. They will eat you. But I do want to overcome my fear of things I don't understand that can help me. And the fear goes away with knowledge. So sit down with a good smartvestor pro, click that at Ramsey Solutions and let the guys that we recommend begin to teach you and gradually start to understand. And as your confidence builds, then you increase, you'll easily increase the amount of money you start pouring into retirement type investments and you won't have to worry about the whole idea of conservative versus whatever bull crap. Something you read on the Internet. Right?

[Caller]

Yeah, I completely understand that. That's absolutely true.

[Dave Ramsey]

Ken.

[Ken Coleman]

Yeah, I was just going to echo that, that right now you have no idea what you don't know and it just paralyzes you. And so I think the quicker you can get seated with SmartVestor Pros interview several, figure out the one that you've got the best chemistry with. There's that teacher relationship going on and you can make up some ground pretty quick, but you've got to be aggressive. And I would say, Dave, beyond just the mindset of aggressive, I'd be doing some things if I were him to make some extra money and try to catch up. Where can I make an additional 10 grand, an additional 15 to 25 so you can play catch up and start stacking some money. When you begin to see that momentum, by the way, that that gets really, really exciting and you start doing more of That a lot of people think that they got to have a side hustle just to pay off debt or just pay the bills. In this case, when someone is that age, to the extent that you can do some extra work and leverage your skill and experience to pour more money on top of the little fire, the bigger that fire gets. That would be a direct challenge in this situation for him.

[Dave Ramsey]

That's very good. And that reminds me, you know, when. When they're walking around out there in the world, people say these sayings that are just stupid, you know, here's one of them. What you don't know won't hurt you. What you don't know will kill you. That's a dumb butt saying. You know, lack of knowledge, knock you out, man. I mean, it's. That's a ridiculous. You know, like you can just stick your head in the sand and I'm not talking about Jack here. I'm just saying in general. But, yeah, it's a big deal to know new things all the time. Angela's with us in Knoxville. Hi, Angela. How are you?

[Caller]

Hey, Dave. I'm doing all right. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Awesome. So today is actually my birthday.

[Dave Ramsey]

Happy birthday.

[Caller]

Thank you.

[Dave Ramsey]

How old are you?

[Caller]

42.

[Dave Ramsey]

Oh, okay. Just a pup.

[Caller]

Yeah. Yeah. So I actually met you in Orlando a couple years ago, in fact, at one of your events. So I'm trying to get back on track. Dave. I never did the baby steps. I purchased FPU at that event. Never did anything with it, like a dummy. And so basically, I'm in $30,000 of debt. About 18 of that is my car, and another 7 in credit card debt. And I owe 5 to a family member. And so my question is, I'm trying to figure out the best way to go about once I get to baby step two, because I'm going to be finishing baby step one next month, and then in August, I'm going to start tackling the debt. My car has about 250,000 miles, and I use my car right now to make a living. And so my concern is if I start tackling the smaller debts first, and then my car breaks down and the transmission goes out or something, I can't fix it. And I. You know, I don't know if I should be saving more in my step one for that or that's kind of where I'm stuck. And I just wanted your input.

[Dave Ramsey]

You owe $18,000 on it?

[Caller]

Yeah, I. I had a paid for 4Runner a few years ago, and then I started A new job.

[Dave Ramsey]

You owe $18,000 on a car you have 250,000 miles on.

[Caller]

Yeah, because I was a courier. I ran the miles up on that thing. I was a courier for the last two, three years, since I bought the car. Just racked it up.

[Dave Ramsey]

Okay. What kind of car is it?

[Caller]

It's a 19 Dodge Charger.

Okay.

Six cylinders. The cheaper one.

[Dave Ramsey]

Yeah. Okay.

[Caller]

All right.

[Dave Ramsey]

Okay. No, I mean, we're worrying about something that hasn't happened yet. It's. It's a reasonable thing to worry about because those things may occur. But I'm not going to change the game plan here. I'm going to. You know, if you have a problem, you may have to stop your baby steps and address the problem. But until you do, you were already broke before you started this, and now you're just running broke trying to do. Actually do some good and climb out. Right?

[Caller]

Yeah.

[Dave Ramsey]

I mean, so, yeah, cut up your credit cards and let's start attacking them with a vengeance. And work as many hours as you can. And as Ken says, always, you know, get an extra job. Let's do six things and. And do that written budget in detail and live on nothing and work all the time. And let's begin to get this cleaned up, because this is a scary place to be for you.

[Caller]

It definitely is. I'm actually. I had. I moved to Knoxville from Florida back in just this last December, and I had a pretty decent job. Didn't pay too great, but it was. It was all right. It was my first job. I moved here. I got laid off, like, after three months. They just didn't need me anymore. And so I've been door dashing, like, 72 hours a week ever since. And I have another. Another job that I started, but they're just trickling me in with work. It's not. I'm not full time with it yet. Once I do, that should be about 72 a year.

[Dave Ramsey]

That'd be huge. That changes everything, Ken.

[Ken Coleman]

Yeah. I'd love to see her really hustle through this quickly, because that car is going to be a problem pretty soon.

[Dave Ramsey]

Yeah, yeah. And it's. But I don't want to stop doing it. No, no, no. In lieu of something hadn't happened, I'd.

[Ken Coleman]

Let that be that extra motivator.

[Dave Ramsey]

Yeah, exactly. This is the Ramsey Show. When you're tired of feeling stuck with money, there's just one solution. To get different results, you have to do something different. No one accidentally wins with money. You have to have a game plan. And that begins with our get Started assessment. Go to ramseysolutions.com start answer some questions and we'll show you what steps to take next. Don't stay stuck. Take control of your money. Starting Today, go with ramseysolutions.com start. Have y' all noticed that real estate is weird right now? It's weird out there. I mean, it's strange. If you're gonna buy a house right now, if you're gonna sell a house right now, you don't really need to be screwing around with this unless you're dealing with somebody that really knows what they're doing. Cause it's a strange time and you need someone to help you navigate that. If you're a buyer, that way you don't get ripped off and you don't get pushed into some kind of weird thing. Or if you're a seller, you get the proper amount for the property and the right kind of marketing advice from a pro who's actually done it before. Not your uncle Henry who got his license three weeks ago and demands that you list your largest asset with him. That's dumb. Don't do that. No, no. We're going to get like somebody that sells 30 to 300 houses a year. That somebody who actually stays in the business when things are good and when things are bad. They know the market, they know how to navigate weirdness and they can help you. We vet all of the agents that we put in the Ramsey trusted program. We coach them, they're lined up with what we teach here. They understand what you're calling. You're listening to this show that you're gonna be calling with that mindset. And they really are high octane, high protein, get er done. People with proven track records. To find a Ramsey trusted real estate agent for free, just go to ramseysolutions.com Agent Amit is with us in Greensboro, North Carolina. Hi Amit, how are you?

[Caller]

I'm great. How are you guys?

[Dave Ramsey]

Better than we deserve. What's up?

[Caller]

So I long story here, but I was. My background, technical background is engineering and science. I did that for a few years. I went to school for it and everything, but loved basketball. Ended up switching careers and I ended up coaching basketball first at the collegiate level, Division 1, and then into the NBA for the last two years. The NBA is moving more and more towards hiring players. Even with 10 years experience in coaching at those levels, I'm having a hard time finding jobs that are paying me enough to get by. I'm married, I don't have any kids, but we don't have My wife makes exponentially more money than me, so financially we're okay. We have no debt, nothing. Homes paid off, cars are paid off. So we're good there. But I'm thinking now of transitioning into a different career. I have no idea what to do. And I've been so out of touch with what my degrees are in that I don't know if I could go back or if anybody would take it. You know, bring me back there, if that makes sense.

[Ken Coleman]

It does make sense. But I want you to know that that's your fear and doubt that's clouding your judgment and just somebody who's completely objective. A former Division 1 basketball coach. A former NBA coach is a highly attractive bio and resume, especially if you have some skill set that will apply to what you're going for. Just. I'm just interested. What's your favorite part of coaching?

[Caller]

To me, it's about the relationships and the people I interact with every single day.

[Dave Ramsey]

Yeah.

[Caller]

Whether it's players or other coaches or executives, whatever, administrators, whatever it may be, it's. It's a very people, relationship driven business. And that to me, is why I got into the first place. I know the salaries are crazy right now, especially in the NBA.

[Dave Ramsey]

Right.

[Caller]

But I never was about it for the money. I was in it for experience, opportunity, and just because it felt so satisfying. And it still feels satisfying. And I want to keep doing it right as long as I can.

[Ken Coleman]

You play college basketball at any level.

[Caller]

That's. That's the crazy part. So.

[Ken Coleman]

No, it's not.

[Caller]

I'm five, 10, I'm Indian. And there are not a lot of people that look like me that do this right.

[Ken Coleman]

Okay. You actually led me right into my question and you're making my case for me. You aren't in that position because of Your X&O's knowledge and being a guru, a guy who put up 20, 25 points a game. You're not in that role and you haven't gotten into that role based on that. Is that true or false?

[Caller]

I. My success is all from work and relationships. That's it.

[Ken Coleman]

I don't have the 15 year NBA.

[Caller]

Career that some of these guys.

[Ken Coleman]

Exactly. And you have managed to get to the highest level of a sport, the NBA, as a 5 foot 10 Indian. I mean, you really are an absolute freak. In a good way. Okay. And it's all based on your skill set of connecting with others. Can I just tell you something? And Dave can chime in here. He's a guy that is the founder and active CEO of a company of over a thousand people. And he hosts one of the largest, most influential leadership podcasts in the world. We talk about leadership all the time. America needs leaders. I'm paying attention to this stuff every day. And companies need people who can lead. People who know how to connect with people who know how to communicate with people who know how to instruct people who know how to encourage people. Amit, you got an incredible resume.

[Dave Ramsey]

Oh.

[Ken Coleman]

And an engineering degree. So if I'm you, I'm going. I'm going to start with, Let me take that degree of engineering and I'm going to look at the engineering field. I'm not going to limit myself to engineering, but I'm going to start there because I got the degree.

[Dave Ramsey]

And then I'm going to.

[Ken Coleman]

I'm going to start working my connections. By the way, I'm going to give you my book, the Proximity Principle, which for a guy like you who's a learner, it's going to give you the absolute formula, the five people you need to be around that will help you get where you want to go. And by the way, you have an unbelievable network. And so all those coaches who know business guys, your college connections, with all these business guys who used to donate money big time, they were hanging around those D1 programs. Those are your connections. And you go, look, I got an engineering degree. I can get in the engineering field and lead people. Today, I may not be the most talented engineer, which, by the way, Amit, tell me if I'm right or wrong. The guys and gals that are leading teams of engineers are rarely the most talented engineer. True or false?

[Caller]

I wouldn't know. I've been removed from it for so long that I. That I don't remember.

[Ken Coleman]

All right, I'll tell you the answer. The answer is leading engineers. You don't have to be the smartest, Dave. The most talented engineer. You just got to know how to lead people. And this guy, he's bonafide. That's my take. And he's going for management and leadership positions across the spectrum of the business world. I think he can go just about anywhere because it's not about the trade and it's not about the industry. It's about his ability to come in and bring a team together. That's my two cents on that one.

[Dave Ramsey]

Exactly right. What we teach when we're teaching entree leadership to business people is what happens a lot of times is small businesses, people become accidental. Yeah. Entrepreneurs. You know, I'm really good at heating and air, and I Get me a truck. And then I look up and I got 40 people and 10 trucks running around. Now I'm no longer. Now I'm no longer a heating and air technician. Now I'm a leader. That's right. And leading and running a business is a different skill set than fixing your air conditioner. And leading and running people is a different skill set than playing basketball or being engineer. The leadership skill set you excel in.

[Ken Coleman]

That's right.

[Dave Ramsey]

And so you do have a great resume in that sense. Now, the trick is, where do you want to plug it in? What type of a business, what kind of dynamic environment do you want to be in where you're leading? And then finding people through your connections with proximity principle? To plug into one of those locations would be. You'd just be amazing.

[Ken Coleman]

Yeah, I mean, he can absolutely make this transition and do very, very well. Because what he has going for him that a lot of NBA coaches don't have if they leave the. That industry is he's got a really good degree. That engineering degree is very helpful. Meaning he's got that skill set. He's got the mindset to think like an engineer. You add the leadership to it. Unbelievable.

[Dave Ramsey]

Absolutely. It's exactly how it works. So hang on. We'll have Christian pick up and we will get you signed up for that. Send out that book to you, Amit. So, Ken, the proximity principle, give us the thesis of that.

[Ken Coleman]

It just simply means this. If I am around the people and in the places of the space that I want to be in, then opportunities come my way. And so the formula is this. The right people plus the right places always will equal opportunity. I got to get around the right people and then I get in the right places. And when I'm in the right places, I meet more of the right people and then they point me to the right places. And it is this knowledge and connection combination that just keeps moving, moving, moving, moving, moving. And if you stay with it long enough, opportunities show up on your doorstep. This idea of kicking the door down is Hollywood bravado. It makes for great fantasy. But in the real world, connections come at the most, at the most unexpected times. Because we keep showing up in the right place or we keep showing up around the right people, and all of a sudden I'm top of mind, or I've got the experience and I was showing up and then, boom, I'm ready to step into it. Speaking of basketball, John Wooden, arguably one of the greatest coaches all time, certainly basketball. My favorite quote, Dave, he said, when opportunity comes, it's too late to prepare. And the proximity prince gets me in a place when the opportunity shows up, I'm ready to step right into it because I kept putting myself around the right people and in the right places.

[Dave Ramsey]

This is the Ramsey Show. All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back. From the first call to closing day. Find a Ramsey trusted agent near you@ramsey solutions.com agent that's ramseysolutions.com agent. Our scripture of the day, Proverbs 3, 6 in all your ways, acknowledge him and he shall direct your paths. Thomas Sowell says some of the biggest cases of mistaken identity are among intellectuals who have trouble remembering that they are not God.

[Ken Coleman]

Classic classic passive aggressive, just mic drop there by Thomas Sowell.

[Dave Ramsey]

Boom. There he goes. David is in Chicago. Hi, David. Welcome to the Ramsey Show.

[Caller]

Oh, thank you very much. Thanks for having me.

[Dave Ramsey]

Sure. How can I help?

[Caller]

My question is that I'm trying to do the baby steps. I got myself a little bit of a quagmire with my debt, mostly real estate investment, but nothing horrible. So I'm trying to apply the real the baby steps. And I'd like to sell one of my rentals, but I just don't think my tenant is going to be able to relocate and, or it's somewhat of a moral quandary. Anything.

[Dave Ramsey]

Why, why is your tenant, why can't your tenant relocate?

[Caller]

I just don't think that she'll be able to get another home, especially one as nice and large as this one to house her and her kids.

[Dave Ramsey]

So you're not, you're not charging her market rent?

[Caller]

Yeah, it's close. I mean, I could probably charge her more.

[Dave Ramsey]

So if she's getting close to market rent, why can she not take close to market rent and go rent something else?

[Caller]

I don't, I don't think she, I just don't think that it's really available. I think it's really going to put her in a position and I think.

[Dave Ramsey]

She'S going, why is it not available? You think you have the only house?

[Caller]

No, no, I don't. I don't. But she's, I think she's paying for her mom's rent, too. And I've tried to counsel her to, like, maybe they could live together, but I don't think that's a. I don't think it's available. She's been late and behind. You know, you know how it is. As Reynolds and I just. Like I said.

[Ken Coleman]

Well, let me. Let me ask a question. I'm curious. Did you feel this way. Did you have this concern for her before you talked to her about the possibility that you were going to do this?

[Caller]

No.

Yeah.

Yeah, I did.

[Dave Ramsey]

Okay.

[Ken Coleman]

And what was her reaction when she. When you told her that this was a possibility?

[Caller]

I broke it to her a little bit, but not. I really haven't come down.

[Ken Coleman]

You didn't answer my question. What was.

[Caller]

I didn't really say it. I didn't really say anything about selling it. It really had come up yet. Oh, I know it's not going to go over well because I don't. I don't think she's going to find.

[Ken Coleman]

Well, but there's a lot of thinking.

[Dave Ramsey]

You keep using the word think. Listen, I. It is not your job to manage her house.

[Ken Coleman]

That's right.

[Dave Ramsey]

You're her landlord, not her boss. You're not her daddy. And so you're paying. She's paying almost market rent so she can pay this. Take the almost market rent and go rent something else. And if she wants to combine households with her mom, that's completely her business and her problem. It is not your job to manage her life.

[Caller]

Yeah, you're right.

[Dave Ramsey]

And you're not doing anything wrong. No. To take an asset of yours and say, you know, yeah, you don't want to be mean or nasty about it. And if you want to give a little bit more notice, there's no. Nothing on fire here. You know, we're going to. Instead of giving you, I don't know, shame, month to month.

[Caller]

He is. Now, she didn't want to resign last summer.

[Dave Ramsey]

Oh, she didn't want to resign last summer.

[Caller]

No.

[Dave Ramsey]

Yeah.

[Caller]

I get a fair amount of runners like that that don't want to resign.

[Ken Coleman]

But they're not committed to you. You don't have to commit to them. The point is, you're not a bad guy.

[Dave Ramsey]

I think if you said, okay, I'm legally bound by the lack of a lease to give you one month's notice. I'm going to give you three months.

[Caller]

That's a good compromise.

[Dave Ramsey]

And that gives you plenty of time to work your way through this. I've appreciated you being our tenant, except for those times that you didn't pay on time and you don't have to Say that, but you're acting like this is some kind of freaking stellar tenant. They don't pay market rent and they don't pay on time. So I missed where I'm excited about this tenant. So, you know, I, that's not being mean. It's just like you got really one job when you're a tenant. Well, two, don't tear up the house and pay the rent on time. These are the two jobs you got. So it's your job to make sure you're charged market rent. So I know you don't have a moral dilemma at all. You can be kind and you could give more than adequate notice and say, you know, I'm sorry, gosh, if there's any way I can help you with this, I'll try to help you. But if helping you means you staying in the house past this 90 day mark, that's not the type of help I'm talking about. So. But if there's, you know, if we can assist you in any way, I tell you about my friends that have properties, help you find a, you know, something like that. I appreciate that this, but that's what we're going to do. We're going to give you three months notice. Listen, she can process this in three months. And if she's angry at her landlord, who she refused to sign a lease with for giving her three months notice, who's only required to give her one month's notice, that's her fault, not yours. That's her fault. And so I think this is all about David.

[Ken Coleman]

He's such a nice guy that he's worried about a confrontational situation and understand that. But this is nothing more than a difficult conversation and it's not his bag. And I get it, but she's gonna be fine just by virtue of. Only she don't want to sign a deal anyway. She's got options. She knows it could change at any time. David, you're a really good dude and you're just fretting over a difficult conversation.

[Dave Ramsey]

And it's going to be over in about, yeah, 45, 50 seconds. I mean, there's not a lot to it. Yeah, it's, hey, gonna be selling the house. I'm gonna be sending you a note in the mail. So we make it formal that, you know, July 1st, we're going to be done August 1st, whatever it is, and giving you plenty of time. You had 30, you have a 30 day. Right, but I'm going to give you 90 days just because you've been here a while and I want to be kind and thanks. That's it, I'm done. It's really, really don't have to have big long thing here. It's not a whole bunch of feelings. It's, it's. I've had, I've had landlords in my life and none of them had any feelings for me. Just none of them did. I never had one that did that. I mean, if you get a situation like we had one, one time that a guy got a terminal cancer diagnosis and he's got four months to live and he lost his job because he lost his health and his wife had three little kids at home and all this. And so we just didn't charge him rent. We let him live there and let her live there. After he passed for a little while we worked with him. But that can't go on for eight years either. Even that is a period of time we can have some grace and mercy with somebody in that situation, but just simply they're going to have to move. That's, you know, this lady, she really just got to move. I mean, that's part, that's why folks, that's why you want to be an owner when you can be and, and not in a stupid way, don't go buy something you can't afford because I'm afraid my landlord's going to do that. Oh, by the way, if you don't want to move, sign a lease. Hello. Then if he had a one year contract, then he'd have to honor that morally, ethically, legally, everything at that point. So there's the process. And you know, here's the other thing. Those of you that are, that are thinking of owning real estate, you need to have a policy of raising the rent every single year. Because I've been doing real estate for about 40 years and rents have gone up every single year. And the people that I know that get stuck in situations like this, they don't raise the rent for five years because it's a nice person and they pay on time and they cut the grass real in a little pattern and we just love them. And you don't raise the rent for five years and suddenly you've got a way below market situation. And then you try to raise the rent and they have a fit like they think they're the owner. So it's really good. It just keeps the relationship accurately defined. When we raise the rent, even if it's a little bit.

[Ken Coleman]

What's the Dave Ramsey weigh on that? Do you look at the market?

[Dave Ramsey]

And then we look at the market and we go, if they've been with us a long time, it's a little under market. Okay. But not. I mean, I'll take it all the way the max plus some been there one year. We just take it up to market. If they've been there five years, we, we tell them when they come in too, right. Next year rents are going to be higher and just expect. Go ahead and know. And that way they're not shocked. Like what? You know what?

[Ken Coleman]

Right.

[Dave Ramsey]

I don't understand what I mean. What do you mean? What. Rents are going up and so if you don't have that pattern, you set these, you set an entitlement expectation in place and it creates real serious problems later. It's a real bad idea that puts us out 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, Sam.