You'll Never Prosper When You're Tied Down With Payments

Summary

The Ramsey Show – Episode Summary

Episode Title: You'll Never Prosper When You're Tied Down With Payments
Date: October 7, 2025
Hosts: Dave Ramsey & George Kamel
Podcast Theme: Breaking free from debt and payments is essential to achieving financial peace and building wealth. Through listener calls and expert advice, Dave Ramsey and co-host George Kamel counsel individuals facing financial challenges, emphasizing the power of budgeting, living debt-free, and the life-changing impact of intentional money management.

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Episode Overview

This episode centers around the recurring theme in Ramsey’s advice: you’ll never truly prosper financially while burdened with debts and payments. Through a series of real-life listener calls, Dave and George confront the emotional, relational, and practical consequences of debt, offering actionable steps for regaining financial momentum—no matter how “stuck” you feel.

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Key Discussion Points & Insights

1. Losing a Job & Facing Debt: Taking Immediate Action

[00:40-08:30]

• Caller Matthew lost his construction job and is $12–14k in debt, with immediate financial concerns.
• Advice:
  • “You’ve got to go get something, some kind of work immediately. Doesn’t matter what it is, as long as it’s legal and moral.” – Dave [04:55]
  • Pursue any available job to cover bills and regain self-worth; don’t get picky in a crisis.
  • Consider building on skills (e.g., CDL) to raise income potential.
  • Short-term plan: secure any income; long-term: chart a path to a better job.
  • Notable Moment: George reveals he did Instacart for side hustle research, highlighting the dignity in all honest work. (“Tragedy plus time equals comedy… It’s a grind out there, Dave.” – George [07:52])
• Tone: Compassionate, pragmatic, energetic; mix of humor and urgency.

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2. Should We Buy a House When We’re Barely Making Ends Meet?

[10:28-15:47]

• Caller Leah in Maine wants to become a homeowner, but her husband is a new Honda technician earning $3,000/month—less than their expenses.
• Advice:
  • “What you’re describing is not a situation where you buy a house. The math doesn’t work for you, does it?” – Dave [13:16]
  • Prioritize career development and increasing income before considering homeownership.
  • Avoid “house fever” and societal pressure to buy; patience is key while finances catch up.
  • Remain disciplined with a detailed budget, continue to rent, and focus on upskilling.
• Tone: Fatherly, clear-cut, realistic.

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3. Young, Debt-Free, and Just Starting Out: How to Build Wealth Right

[16:08-19:48]

• Caller Hunter just graduated, earns $60k in medical device sales, is debt-free, and living at home.
• Advice:
  • “Please stay that way. If you stay that way, you’ll always have some money instead of giving it all to the bank.” – Dave [17:49]
  • Build three to six months' emergency fund before moving out.
  • Live on less than you make, even when tempted to “keep up” with peers.
  • Invest via workplace Roth 401(k) and continue asking financial questions.
• Tone: Encouraging, congratulatory, motivational.

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4. Caring for Aging Relatives and Preventing Financial Scams

[22:00-28:46]

• Caller Kylie is trying to help her father (diagnosed with dementia) locate ~$175,000 that appears missing after a house sale.
• Advice:
  • “The power of attorney needed to happen yesterday. I’m not even sure it’ll work now.” – Dave [24:28]
  • Act fast to secure legal financial authority; begin an audit trail through banks, emails, and physical documents to track money.
  • If necessary, consult a forensic accountant.
  • The longer you delay intervention, the more is likely stolen through scams.
  • Memorable quote: “The longer you stay in denial, the more checks are going to be written to bad people.” – Dave [28:40]
• Tone: Urgent, protective, direct.

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5. Upgrading Home Vs. Staying Debt-Free: The Peace Trade-Off

[29:02-31:05]

• Caller Colin is debt-free with a mortgage paid off, considers moving to a larger home for his growing family.
• Advice:
  • “Once you finally got out [of debt], it’s emotionally very hard to go back.” – Dave [30:19]
  • Two options:
    • Take on a small, short-term mortgage to upgrade,
    • Or save aggressively and move mortgage-free later (Ramsey preference).
  • Avoid sacrificing peace of mind for space unless absolutely necessary.
• Tone: Solemn, reflective, empathetic.

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6. Credit Card “Arbitrage” Schemes: Penny Wise, Pound Foolish

[32:30-38:40]

• Email from Mark in England: Repeatedly cycles zero-interest credit cards and savings accounts to earn small returns.
• Advice:
  • “You have set up a house of mirrors, a house of traps. If you miss one handhold, you’re in the water.” – Dave [33:32]
  • Risks, stress, and time spent isn’t worth meager “profit” ($1,400/year for 10 years).
  • “Zero humans we have found that your system made rich. Was I unclear?” – Dave [36:41]
• Tone: Sarcastic, humorous, blunt.

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7. Should We Sell Investments to Pay Off Debt? Only if You’re Truly Done with Debt

[43:38-51:48]

• Caller Rex has $167k in non-mortgage debt and $844k in a brokerage account; has gone into credit card debt before after cleaning it up with savings.
• Advice:
  • Use investments to pay off all debt only if you and your spouse make a forever commitment never to borrow again.
  • The mistake isn’t “paying off” but failing to change the behavior that led to the problem.
  • “You don’t have to be in pain to never go back. You just have to be committed to never go back.” – Dave [49:37]
• Tone: Experienced, insistent, cautioning.

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8. Student Loan Overhang: Kill the Debt, Not Your Future

[81:46-84:30]

• Caller Riley in Houston has $68k in student loans and $95k in savings.
• Advice:
  • “Dude, pay it all off today. Why have you waited?” – George [82:29]
  • Mentally subtract debt from “savings;” you’re not as well-off as the account shows.
  • Investing with borrowed money is risky, slow, and rarely leads to real wealth.
• Tone: Direct, practical, unvarnished.

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9. The True Cost of Using Retirement Funds to Buy a House

[75:46-79:42]

• Caller Ryan is urged by his ex-wife to cash out his 401(k) for a home down payment.
• Advice:
  • “Why would anyone ask their ex-wife for financial advice?” – Dave [76:28]
  • Citing tax penalties, Dave explains you lose a huge chunk to taxes/penalties, making it a bad deal.
  • “Do not rob your 401(k) to buy a house. That kind of stuff.” – George [79:37]
• Tone: Witty, critical, firm.

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10. Debt-Free Celebrations & Success Stories

Stories Throughout at [65:05], [106:15]:

• Families and couples share their journeys paying off $140k–400k+ in debt in under three years, often with children, after marriage, and through career or budget changes.
• Keys to Success:
  • “The budget. The budget, and being on the same team.” – Anne Marie [110:00]
  • “Making sure every dollar has a name… so you never do it again.” – Brittany [69:25]
  • “We make too much money to be this broke.” – Christopher [66:52]
• Tone: Celebratory, moving, victorious.

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11. The Psychological & Relational Cost of Debt Payments

Advice sprinkled throughout:

• Carrying debt isn’t just a math problem, it carries a psychological "soul tax."
• “What would it feel like to have your house paid off? It goes beyond the math.” – Dave [104:52]
• Returns from “playing the spread” (investing instead of paying off the mortgage) are easily wiped out by risk and stress.

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Notable Quotes & Memorable Moments

• George on Side Hustles:
  “I wanted to practice what I preach. For a week, I did [Instacart], and I calculated it. It was about 20 to 30 bucks an hour.” [07:33]
• Dave on Homeownership Prematurely:
  “Who’s going to pay for it—the house fairy?” [13:25]
• On “Credit Card Games”:
  “This is how you lost the Revolutionary War right here.” – Dave [33:18, to Mark in England]
• On Commitment to Change:
  “Cut up the cards—have a plastic surgery party.” – Dave [51:01]
• On Helping Elderly Parents:
  “You’ve got to shut this funnel down for his sake… The longer you stay in denial, the more checks are going to be written to bad people.” [28:40]
• On Prosperity:
  “You’ll never prosper when you’re tied down with payments.” [Recurring theme]
• On Teamwork in Marriage:
  “Being on the same page with each other—and making sure that budget is key above all.” – Anne Marie [109:55]

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Timestamps for Major Segments

• Job loss, surviving debt: 00:40–08:35
• Homeownership & career reality: 10:28–15:47
• Young professional building habits: 16:08–19:48
• Elderly parent's missing funds: 22:00–28:46
• Should we move back into mortgage debt?: 29:02–31:05
• Credit card ‘arbitrage’ schemes: 32:30–38:40
• Paying off debt with investments: 43:38–51:48
• Student debt vs. savings: 81:46–84:30
• Cashing in 401(k) to buy a house: 75:46–79:42
• Debt-free screams: 65:05, 106:15

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Tone & Style

The episode is lively, fast-paced, and blends tough love with practical tactics and plenty of humor. Dave and George alternate between empathetic encouragement and sharp, no-nonsense reality checks, demystifying complex financial decisions and calling out common rationalizations that keep people stuck. Their real-life stories and examples make the lessons tangible and memorable.

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Takeaways for Listeners

• Act quickly and decisively when financial trouble hits; any honest work is dignified.
• Budgeting and teamwork in marriage are crucial to making real progress.
• Don’t let emotion or “FOMO” push you into purchases you’re not ready for (homes, cars, etc.).
• Never cash out retirement for quick gains—it’s always more expensive than you think.
• Avoid schemes, short-cuts, and debt “arbitrage”—building wealth is about habits, not tricks.
• Celebrate the victories—even tough journeys with debt can inspire families for generations.
• Remember: Prosperity begins when you break free from the chains of payments and debt.

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If you haven’t listened, this episode offers the perfect blend of hard-won wisdom, practical tools, and motivating real stories to help anyone take the next right step toward financial freedom.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broken. Common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fair Winds Credit union studio, this is the Ramsey Show. George Camel, Ramsey personality number one best selling author, co host of Smart Money Happy Hour is my co host today. Open phones at Triple 8, 825-5225. Matthew's in Lexington, Kentucky. Hey, Matthew, what's up?

[Caller]

How you doing, sir? I was told. Just get straight to the point. So I lost my job this morning as a construction worker. I'm roughly 12 to 14 grand in debt if you count my credit card. I'm on the hunt for a new job at the moment. I'm just a little lost. I was hoping to get a new house by the end of the year and now everything's just kind of been ripped away. So I was calling to kind of see about any advice I can get from you guys. I've been watching for a while.

[Dave Ramsey]

Wow, that's a. That's a day that sucks.

[Caller]

Yeah. Oh, yeah.

[Dave Ramsey]

What happened? How'd you get fired?

[Caller]

So I was working in construction.

[Dave Ramsey]

Yeah.

[Caller]

And. Oh, okay. Sorry. He said it was poor attendance and I've had the job for about eight months and I've only called in twice. I've never been late. So I called his boss, the guy, another foreman that's over him, and he said that it was something else, but he doesn't know what it was. So I'm not sure what specifically to do in the situation now. I'm kind of broke.

[Dave Ramsey]

What were you. What type of work were you doing on the construction site?

[Caller]

I was a laborer, so just all the grunt work that they could possibly have.

[George Kamel]

What were you making?

[Caller]

So I was promised 27 an hour. I was only making 22 an hour.

[Dave Ramsey]

How long did you work in this place?

[Caller]

Roughly seven and a half, eight months.

[Dave Ramsey]

Okay. And they never kept their promise and then fired you and you really don't know why?

[Caller]

Yeah.

[Dave Ramsey]

Sounds like wonderful people to be rid of. Wow. But you still got to go get a job, like, instantaneously, right?

[Caller]

Yes, sir.

[Dave Ramsey]

I'm guessing you have any money in your checking account?

[Caller]

Yeah, I've got enough to cover, you know, whatever I have for bills coming up, you know, in the next couple weeks.

[Dave Ramsey]

Okay, good. All right. And you probably got another check coming from them, right?

[Caller]

Yes, sir.

[Dave Ramsey]

Okay, that'll help some. All right, so. Well, I mean, you're right. It's asking a lot to emotionally bounce back in the Afternoon from being fired in the morning. But you, like you said, you don't have a lot of choices, so you've got to go get something, some work immediately. And so, yeah, I'm going to go just start visiting construction sites in the area.

[Caller]

Well, I also have experience in driving as well, and the construction industry is just kind of dropping down here a lot.

[Dave Ramsey]

Yeah. May have been the actual reason you got fired. The. May have been a layoff, actually. But the. You got a cdl.

[Caller]

So partially towards my cdo, I had. I was in classes at my other job.

[George Kamel]

What can you do today that involves driving?

[Caller]

I can drive a non CEO vehicle just like everybody else can, but I am one written test away from class B cdo.

[Dave Ramsey]

Mm.

[George Kamel]

And that'll give you a nice raise if you choose to do that.

[Caller]

Yes, sir.

[Dave Ramsey]

Yeah. Well, if you. Especially if you could get somebody to hire you this week based on that one written test coming through in the next couple of weeks and you could get started with them, just move stuff around the lot or whatever else you had to do. Yeah, I think that's a. That's not. It's not a bad option. And you probably would make more than they were going to pay you even if they had paid you what they promised they were going to pay you and all that. So. Yeah, I think the trick here is there's two ways to think about this. The first way is you got to get off of desperation onto a job and don't even care what it is as long as it's legal and moral, you know, as long as you're not hurting someone or yourself. Right. And so, you know, go. Go get something. I don't care. Driving another construction site, Target FedEx. You know, we're going to be in Christmas season for, you know, it, you know, driving for Amazon. I don't care what you land, but land something immediately. Because if you have. If you know, you have enough coming in to eat and to keep the lights on and the rent paid, you will interview differently for the next job.

[Caller]

Yes, sir.

[Dave Ramsey]

So the first job is just take anything in desperation that is legal and moral and get to where, you know, you got food to eat. Are you married?

[Caller]

I am, yes.

[Dave Ramsey]

Does she work outside the home?

[Caller]

Yeah, she. She works in the medical field.

[George Kamel]

What does she make?

[Caller]

She makes about 15 to $16 an hour.

[Dave Ramsey]

Not much either. Okay.

[Caller]

No.

[Dave Ramsey]

All right. But you got. But you do have enough to eat that way, right? And so not enough for you to sit on the couch permanently. But you don't have to pan now and next Friday, right?

[Caller]

No. No.

[Dave Ramsey]

Okay, so let's, let's get out there and scoot around. Now then once you've landed that next thing where you're eating, the second stage is you start figuring out, okay, what do I want to be in 10 years and what is the steps to get to be one of those. And it needs to be something that makes more money.

[Caller]

Yes, sir.

[Dave Ramsey]

And it's not just for the money, but what do you want to be? You know, like, like mom and dad used to ask when you're growing up, what do you want to be when you grow up? Right? And you know, what do you got some passion about? What do you got some tal and those kinds of things. I'm going to send you a copy of Ken Coleman's book, Finding the Work youk're Wired To Do. It has a great assessment in it. I want you to take that assessment and start planning out your long term landing place. But your short term landing place is anybody that will pay you. And you can show up having showered and shaved and brushed your teeth and on time. Oh, why don't we make it 15 minutes early for the heck of it and leave 15 minutes late while you're there. And make sure that you're the hardest working dude that they've ever seen during the time that you're there. And don't you pull out your phone one time during the time you're working, actually be doing work and stuff. And so, yeah, that, that changes everything.

[George Kamel]

And there's so many, you know, the economy side gigs right now that you can just literally download an app and get started within an hour.

[Dave Ramsey]

Like, what?

[George Kamel]

I mean, I did Instacart last December as a test and literally I downloaded the app, made my account, and I was on the road and I went, you know, got groceries for people. Another one is Uber Eats and Doordash.

[Dave Ramsey]

All of those showed up at somebody's door with Instagram. They had to be freaking out.

[George Kamel]

I mean, I made sure to not actually I left it at the doorstep, but on their camera.

[Dave Ramsey]

Oh, they should have done. It was you.

[George Kamel]

The best part was I would have.

[Dave Ramsey]

Thought they would have thought I didn't pay you.

[George Kamel]

Well, I embarrassingly, I went to my. I didn't realize, like, this is an awful street. I recognize it was my neighbor's house. And like, they're probably looking at the camera going, is that George, my neighbor, delivering groceries? What's going on?

[Dave Ramsey]

That's so funny.

[George Kamel]

But I thought.

[Dave Ramsey]

I just wanted to see how it worked.

[George Kamel]

I wanted to practice What I preach, I tell people, go get these side jobs. And for a week. I did it in December and I calculated it. It was about 20 to 30 bucks an hour.

[Dave Ramsey]

How did I not know this?

[George Kamel]

Well, I kept it from you, Dave.

[Dave Ramsey]

Completely ragged on you for a whole year.

[George Kamel]

Now you know why.

[Dave Ramsey]

I just shared it. And now I Instagram or Instacart. George.

[George Kamel]

Tragedy plus time equals comedy. So I needed to wait long enough to where it was funny. Didn't look desperate, but man, it was. I'll tell you, it's a grind out there, Dave, getting people's groceries. I was in the bulk bins at 9pm Just getting in one pound of rice, measuring it out, going, this is. This is. I. I remember the sacrifice. I don't want to relive this again. Liter rice and beans out there.

[Dave Ramsey]

And you're doing it for. For the show.

[George Kamel]

I thought maybe I can make content out of it, but it was too stressful to even get my phone out and film. I was hustling.

[Dave Ramsey]

You look stressed.

[George Kamel]

I did.

[Dave Ramsey]

A year later, I'm still stressed.

[George Kamel]

I'm sweating reliving this. So shout out to everyone sacrificing on their second and third and fourth side.

[Caller]

Hustle.

[Dave Ramsey]

If you've listened to me for more than five minutes, you know that being normal with your money is not a good thing. Because normal is broken. And I want you to be weird. That's why I love what we're doing with Fairwinds Credit Union. Our friends at Fairwinds just launched a brand new Ramsey debit card. And it says, debt is normal. Be weird right on the front. I love that because every time you swipe it, you're choosing to live differently with no credit card payments and no debt. You see, Fairwinds has been helping people like you ditch debt faster and build wealth for years. They're not trying to shove credit cards or auto loans in your face like the big banks do. And they've worked with us to create the smart bundle for Ramsey fans. It includes a no fee checking account, a high yield savings account to supercharge your emergency fund, and now the Ramsey debit card to help you stay focused on the baby steps. We're excited for you to try it. So check them out [e-mail] Ramsey that's Fairwinds.org Ramsey insured by the NCUA. Leah is in Bangor, Maine. Hi, Leah, how are you?

[Caller]

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

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So I am calling seeking advice on how to best Approach homeownership. My husband and I took your financial peace course back when we were engaged. We currently use the Every Dollar app for our budgeting, which has been incredibly helpful. So thank you for that. And now we are looking at home ownership and trying to figure out how to make that happen. Currently we do rent for $1,000 a month and it's really an ideal situation, but we have one baby and we are hoping to expand our family and so home ownership is ultimately our goal.

[Dave Ramsey]

Good.

[Caller]

My husband is the only one working. I'm home full time and so that's kind of where the challenges come in. He brings home roughly $3,000 a month and there is potential for that to grow over time. He's kind of new still to the company, so he's starting out and learning the job. But with all that being said, he is working on picking up some extra hours. On his days off he works for 10 hour days. And so on his two days off he's looking at picking up some extra work because currently our monthly expenses do exceed our monthly income by a couple of hundred dollars. And so that's the challenge. We do have good savings. We have about 58,000 saved. We have about 16,000 for an emergency fund. We have no debt. And he does contribute to his 401k, but we just aren't really sure how to move towards.

[Dave Ramsey]

How have you done all that on $3,000 a month?

[Caller]

It started way, way before then. I've just always been a diligent saver. So from the time I started working, most of my money just went right into saving. And then when we got married, when.

[Dave Ramsey]

You had a baby, you came home. I see. Okay. All right, so what happens long term to get his income up to double what it is now.

[Caller]

So he does have to take some certifications. He's a technician, so he needs to take classes to get certified as a master tech. That's one way that he'll increase his pay. And then I think also just experience as he becomes more efficient, he'll be able to work faster because he gets paid by the job and not by the hour or salary.

[Dave Ramsey]

What's he working?

[Caller]

So they're what vehicles? Oh, he's a Honda Tech.

[Dave Ramsey]

Okay, good. Yeah, I want to. A Honda Tech ought to be making more than $36,000 a year. So he must have just gotten started. And so he's got. Yeah, he's got. He's going to have to go to all the classes as fast as he can take them and move up as fast as he can move up to get your all's income up. Because what you're describing is not a situation where you buy a house.

[Caller]

Mm, math.

[Dave Ramsey]

The math doesn't work for you, does it?

[Caller]

No. And that's what we thought we were getting advice from other people saying, just buy a house. You'll figure it out.

[Dave Ramsey]

Who's going to pay for it? The house? Ferry?

[Caller]

I wish.

[Dave Ramsey]

Yeah. I mean, there's not one. Unless you all got them in Maine. We don't have them in Tennessee.

[Caller]

You know, I haven't found.

[George Kamel]

I mean, you have a deficit right now and your rent is only a thousand bucks a month.

[Dave Ramsey]

Yeah.

[George Kamel]

And so this is my house.

[Dave Ramsey]

It'll all work out. What are you, a congressman? Who says that? Yeah.

[George Kamel]

How are you covering the difference now? Are you guys dipping into your savings?

[Dave Ramsey]

Yeah. No, he's working extra. He's taking side hustles.

[Caller]

He's picking up some extra shifts just to cover that family friend who's a contractor.

[Dave Ramsey]

Yeah. Well, here's what I want. I want a career path that leads us to more income which allows us to buy homes.

[Caller]

Okay.

[Dave Ramsey]

And that's what answers your question.

[Caller]

That makes sense.

[Dave Ramsey]

That's what answers your question. And so if it's a Honda Tech and he's making six or $7,000 a month because he's gotten every Honda certification and whatever other brands are at that dealership, go ahead and get all those Certs as well. And let's just get certified in everything out there and we can work on everything and we can make a bunch of money. Because, you know, a really good guy turning a wrench with the proper Certs ought to be making a lot more than he's making.

[Caller]

Yes.

[George Kamel]

So the hard truth is that home ownership is not going to happen in the next six or 12 months. No, it's going to need to get your income up and maybe a bigger down payment and maybe not the house you really wanted.

[Dave Ramsey]

You got 58,000 for the down payment, right?

[Caller]

Yeah. That's everything we have saved.

[Dave Ramsey]

And you're debt free. Well, thank God you're living on a detailed plan because it's allowing you to make it on almost nothing while you're able to stay at home with the child. Which is great, but basically what we've said is we put house on hold while his career develops and then the math will allow us to buy a house. And by the way, that's kind of normal. Unless, you know, unless you grew up in a generation where when you pushed a button in your hand, everything happens automatically. Oh wait, yeah, you did. So. Yeah, it doesn't work that way. It's going to take some time. It's a process and it's a. It's got to cook a while.

[George Kamel]

Yeah, well right now you can just doom scroll on Zillow and look at all the things you can't afford. Back in your day, Dave, not to age you, but the Internet didn't exist to go look at every house that's available that you can't have.

[Dave Ramsey]

No, we had to go to open houses and then we would get house fever that way. We had to do it the old fashioned way. But house fever. House fever is highly contagious and it has been among us for several decades.

[George Kamel]

So just got easier with the digital age.

[Dave Ramsey]

Yeah, you can. Yeah, well, a lot of addictions are. Have advanced themselves. But anyway, yeah, just take your time, hon. You're going to be okay. You're going to get there. But the two things do work together and it sounds like you really have a wonderful handle on where you are. Congratulations. Hunter is in New York. Hi Hunter, how are you?

[Caller]

Hi guys. How you doing?

[Dave Ramsey]

Good, man. How can we help?

[Caller]

My call.

[Dave Ramsey]

Sure.

[Caller]

Yes, I'm. I'm not too financially savvy. I graduated college in May, so I just got my first job. Hopefully a long term career. Career job. I really like it.

[George Kamel]

What are you doing? How much do you make?

[Caller]

I'm making 60,000 a year before taxes.

[George Kamel]

Way to go. What kind of job is this?

[Caller]

I mean, it's a sales role. I'm in medical device sales.

[Dave Ramsey]

Oh, so you're just starting. Okay, cool. What's your degree?

[Caller]

Yeah, just starting. Business management.

[Dave Ramsey]

Good for you. Medical device sales. I know a lot of folk making two bills with it, not their first year.

[Caller]

That's, that's why I really, I really looked into it. I had to work pretty hard to get the job because they don't really hire out of college. Too much.

[Dave Ramsey]

Yeah. So you're gonna have to get with it. And really the 60 is just your first year. You probably truthfully should double that in almost a year.

[Caller]

Really?

[Dave Ramsey]

Yeah, if you get with it. Assuming I don't know what their product line is or who it is you're talking to or working for. But that's the thing. So what's your question, sir? You said you're not financially savvy. How can we help you?

[Caller]

Yeah, so I was just curious what I could be doing to set some money aside, invest it properly to set myself up for the future. I mean, I have a Roth 401K with my company.

[Dave Ramsey]

Are you. Are you debt free?

[Caller]

Yes. Yes. No debt, no student loan debt, no athletic scholarship.

[Dave Ramsey]

Good. No car debt.

[Caller]

No car debt. Good credit card debt. Anything good for you?

[George Kamel]

Think you're more financially savvy than you think, my friend. Way to go. Yeah, just setting yourself up like that is a big win.

[Dave Ramsey]

Would you just please stay that way? If you stay that way, you'll always have some money instead of giving it all to the bank.

[George Kamel]

So your co workers are probably going to be driving nicer cars than you and buy houses before you are. And that's going to be tempting. So don't let that stop you from living on less than you make. Do you have an emergency fund?

[Caller]

Yeah, I have a savings account with like $7,000 in it.

[George Kamel]

Good way to go. So let's keep building that up a little bit to three to six months of expenses. Are you renting on your own right now or do you got roommates? What's the situation?

[Caller]

I'm still living. Living with my parents at home.

[George Kamel]

Okay. Maybe the next step might be getting your own place.

[Caller]

Yeah, definitely.

[George Kamel]

And then on top of that, once you get that emergency kind of.

[Caller]

Another question I have, when to move out? I mean, right now? Yeah. When to move out? Like right now I'm living rent free, saving money on food, on all that stuff.

[Dave Ramsey]

How long you been out of school?

[Caller]

I got out. In that? Yeah.

[Dave Ramsey]

Yeah. Okay. Yeah, I. I don't want you there next May.

[Caller]

Yeah.

[Dave Ramsey]

Okay. So that's your max. So you decide when and how. But start. Start planning your exit and time to sprout the wings and fly, be the eagle that leaves the nest. And of course, by then we'll see what your income trajectory is. And that's going to help you as well. Yeah. Your Roth IRA is fine. And if you want to start saving even more than that over just in your savings account, build up that emergency fund really thick. That was not a bad idea either. The Roth 401K, it works. Not a bad idea. I'll send you a graduation gift, the copy of the book, the Total Money Makeover. And it will walk you through in detail exactly what to do next and next and next and next, all the way through. It will take you up through what we call the baby steps here. And we're going to keep you out of debt, into investing. And that's going to be your shortest route, moving into wealth. And you got a great career field, a lot of upside there. You're just getting started. You're asking the right questions. Keep asking Lots of questions. Keep working like a crazy man. Hang on. We'll send you a copy of that book.

[Caller]

It's.

[George Kamel]

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[Dave Ramsey]

The all new every dollar is here and now. It's way more than just a world class budgeting app. It's a ton of advanced features to help you make faster progress with your money. If you take the Ramsey system, the Ramsey way that we've taught the baby steps, et cetera, and weave them into an app that shows you exactly what to do, you're beginning to deal with what I'm talking about here. The average person finds thousands of dollars of margin in the first 15 minutes after they open the app. Laying it out. Every dollar is free. You can start it today, go to the App Store or Google Play. Kylie is in Greenville, South Carolina. Hi, Kylie, how are you?

[Caller]

Hi.

Thank you so much for taking my call.

[Dave Ramsey]

Sure. What's up?

[Caller]

Okay. I'm seeking wisdom on how to help my dad. I don't know what to do, and so I figured I'd call you and maybe you could guide me in the right direction. My dad is 83. Coming up on 83. He has Social Security. He has no retirement. But according to our calculation, he should have a lot more in the bank than he does. And with a recent diagnosis of onset dementia, we are finding that we can't find where his money has gone. And we don't know how to either find it or figure out if he's being scammed or how to make what he has left stretch.

[Dave Ramsey]

Wow. So how much do you think is missing?

[Caller]

Okay, we think that there's somewhere between 150 to $175,000 missing.

[Dave Ramsey]

Wow.

[George Kamel]

That's from Social Security payments that have disappeared.

[Dave Ramsey]

No, he had investments.

[Caller]

Well, he sold his house for $400,000 in 2021. He bought himself a $14,000 truck. He moved across country and bought a $195,000 house. So roughly, we thought he had around 200,000. He's getting 1500 dollars a month on Social Security. He told us he put his money that he had remaining left over into two different banks and opened up a couple checking and savings accounts in those banks. But recently we started getting involved because his electricity would get cut off. He couldn't remember how to pay his electricity bill. We heard that he was paying people money over the phone that he did not have an account with. Like, people would just call and say, hey, you owe us $500 for a late fee. And he would just pay it. And then he can't answer simple questions like who's his cell phone carrier, who does he owe bills to so we can help him straighten it out. He doesn't know.

[Dave Ramsey]

He doesn't know who the two banks are.

[Caller]

He doesn't. He. He thinks he knows where they are, but his stories don't.

Aren't.

They are not straight. Like, he will tell us that he had an account with US bank, but then he'll tell us he closed it, but then he tells us it's open, and then he knows he has Wells Fargo. He goes to Wells Fargo every day. But then he can't keep straight. I don't have any money.

[Dave Ramsey]

Yeah. Is there a power of attorney been assigned?

[Caller]

Not yet, no, sir.

[Dave Ramsey]

That needs to happen yesterday. I'm not even sure it'll work now. Doesn't sound like he's competent now, but I don't know.

[George Kamel]

That means you're taking over financial powers to handle his accounts.

[Dave Ramsey]

Somebody needs to, okay? Desperately.

[Caller]

Okay.

[Dave Ramsey]

I mean, he's not even sure what day it is and what cell phone carrier and that kind of stuff. He does not need to be handling his money. Okay, then how do we find a lost 175,000? I really don't know is the answer. Do you have any kind of a paper trail or an electronic trail of any kind of.

[Caller]

We are digging through stacks of bank notices that we have found in his house.

[Dave Ramsey]

Yeah.

[George Kamel]

Have you checked his email?

[Caller]

I have not yet. That's a great idea.

[George Kamel]

I'd be going through everything, digital, physical, calling banks, looking for debit cards attached to those banks.

[Caller]

Okay.

[Dave Ramsey]

I mean, it's possible. It's possible he's been scammed out of it. It's also possible it's sitting over there in US bank, but you don't have any access to it without a power of attorney.

[Caller]

Okay.

[Dave Ramsey]

You can't walk over there and ask him if I Have an account either. They won't let you. It's against federal privacy laws.

[Caller]

Okay?

[Dave Ramsey]

So, I mean, but you, if you got a power of attorney, you can go on his behalf and do it. And you only to do that yesterday, okay, like six months ago yesterday, but to go do it today. Do not let this, I mean, 48 hours, kid, right now, go get it done. And so then you can start to inquire with these people because otherwise they're just going to shut you down. I mean, just like if you called up and asked where George bank, they're not going to tell you.

[Caller]

Okay?

[Dave Ramsey]

Okay, so, but if you go, here's the power of attorney. Here's a copy of the power of attorney. He's 82, he's got onset. And I'm trying to find some money that's lost. Do you have an account there? Okay, what's the balance? What's the account number? And then you start tracking everything down that you can. If you reach a complete dead end on all stacks of paper and all email and text and anything else you can get ahold of. If everything is run to ground and you still haven't found it, you could go to our local, our endorsed local provider for taxes, our tax elp. They probably can make you a wreck. A recommendation of a forensic accountant. And a forensic accountant is someone who knows how to dig through those things and try to find a trail maybe that you didn't see and trace back through. If he's been scammed, I don't know where you'll be. But in the meantime, y' all are taking care of him anyway.

[George Kamel]

So I would think of every professional he's interacted with. CPAs, accountants, tax pros, real estate. I mean, if there was a real estate transaction, that money was wired somewhere. And maybe you can go to the title company that handled the wiring and figure out where it went and that might give you some clues at least.

[Dave Ramsey]

Yeah. Which. Which account did that go into? And then if you find that account, you can go from there. Where did it go from that account? Check the statement transferred and every account of every touch point. Do a full audit on it.

[Caller]

It.

[Dave Ramsey]

And I want to see a full list of every transaction for the last seven months or since he sold the house. And what we're trying to do is follow that one 75 or that 150 around, that extra equity around, because we do know he bought two things, but he should have somewhere around 150 left, give or take. And yeah, find out where it went. That's a Good thing. George, go to the closing and see where that money went and then do an audit there, find out for where it went from there, then find out where it went from there. And in every case you'll see transactions and you can run them down. You're going to have to have power of attorney to do all that though, and you're just going to have to run it to ground. But the big thing is everybody is no longer in denial. We have a power of attorney and he is shut down and he's not allowed to do any more transactions at all. He does no access to any accounts because people are calling him up and he's giving people 500 bucks and then y' all are having to put 500 bucks over there to feed him. So they're stealing money from you is who they're stealing money from. So you've got to shut this funnel down for his sake. And he doesn't want you to. You don't want to admit that your dad is finally at that stage, but here we are. The longer you stay in denial, the more checks are going to be written to bad people. And so you guys have really got to shut this down hardcore fast. Just because he's getting screwed over. If he hadn't already lost 150 grand.

[George Kamel]

Yeah, I feel like we're getting more and more calls of people getting scammed out of hundreds of thousands of dollars because they're just, you know, they prey on the elderly.

[Dave Ramsey]

Exactly.

[George Kamel]

Prey on people who, you know, who mentally can't handle this and don't know if it's a scam.

[Dave Ramsey]

Colin in Jacksonville, Florida. Hey Colin, what's up?

[Caller]

Hey, Dave and George, thanks first and foremost for everything you guys do. Really helpful content.

[George Kamel]

Thank you.

[Caller]

But to be direct and. Yeah, of course. My question is this. My wife and I am almost certain we're on baby step seven. We're totally debt free, including the mortgage. And to your guys point, the peace of mind is amazing with that. But with that being said, we're in a two bed, one bath currently. It's myself, my wife and a year and a half old daughter. I also work from home as well. So things are starting to feel a little cramped. And although need is a pretty strong word, I do think that we're inching toward a need for additional space. And so I'm kind of battling or going through the pros and cons of having another mortgage and upgrading the space versus kind of remaining cramped and having that piece every month of not having mortgage make.

[Dave Ramsey]

What do you make?

[Caller]

We we make about 225 as a household.

[Dave Ramsey]

So how much can you bank a year?

[Caller]

Right now we're, we're investing in 15 and saving about six grand a month.

[Dave Ramsey]

Okay. All right. And so what's your current home worth?

[Caller]

It's worth 250. I, I think.

[Dave Ramsey]

What's the target? What's the target home? How much is the target?

[Caller]

500. 500.

[Dave Ramsey]

500. So you need 250.

[Caller]

500K.

[Dave Ramsey]

Yeah.

[Caller]

Yeah.

[Dave Ramsey]

Well, I mean there's two ways to do it. One is take out a small mortgage and two is we'll move in two and a half years and we're gonna save $100,000 a year because we don't borrow money anymore. That would be Sharon's and my only option because we don't borrow money for anything ever. Even though that's uncomfortable, inconvenient and all that. But if you want to go just a little bit in and kind of meet in the middle and knock off a mortgage in two or three years, you can do that. But it's emotionally very hard to go back in debt once you finally got out.

[George Kamel]

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[Dave Ramsey]

Our question of is sponsored by Y Refi. If other lenders won't help with defaulted private student loans, why Refi might be right for you. They offer fixed rate solutions that fit real life. Find out [e-mail] Ramsey that's the letter y r e f y.com Ramsey not in all states.

[George Kamel]

Today's question comes from Mark. In England we are retired, mortgage free and financially stable with no debt except our credit cards. We buy what we need on a credit card that gives us Points which we use to pay for clothes, food, etc. We then take that credit card debt and put it onto a long term interest free credit card for a period of 12 to 34 months, only paying the minimum balance each month at the same time as the start of the 0% deal, we put an equal amount into a savings account that pays us 7% interest. At the end of the 0% term, we pay it off in the savings and then keep the interest earned to pay for travel or a large cash purchase. We've been doing this for 10 years with no interest incurred. Cash back to us has been six grand plus eight grand earned in interest from the savings. Why shouldn't we keep doing this? Because it's exhausting.

[Dave Ramsey]

Number one, this is how you lost the Revolutionary War right here.

[George Kamel]

Zinger.

[Dave Ramsey]

Oh my God.

[George Kamel]

Take that, Red coats.

[Dave Ramsey]

Unbelievable.

[George Kamel]

The mental calories needed has got to be worth something. Your time is worth something.

[Dave Ramsey]

And here's what's ridiculous. We don't, we do not know the dollar amount, but what it took to get you took. I mean, what could you, what could we talk about? 50,000 bucks. And you run it through all of those ringers. When you get done, you got enough money to buy a biscuit. I mean, there's no money involved here. This is a, it's like a math riddle for a sixth grader and you fell for every bit of it. I think you need a hobby. Really. This is like exhausting. So the problem with all this is, is you have set up a, a house of mirrors, a house of traps, and you have figured out how to know. You know, I'm trying to remember what, what's the thing where the kid, where the people, the, the ninja thing where they go through all the like American ninja warrior. Yeah, like you're an American ninja or the English ninja for credit cards. So you've got this full obstacle course laid out and you know how to do it, but if you miss one handhold, you're in the water. If you, if you jump just wrong, you're going to turn your ankle and be on your head. And so that's exactly what this is like a, it's like an obstacle course. It's like you did a treasure hunt with an obstacle course in your backyard and you're 12 years old. No. And it's not worth the money if you actually add up the actual dollars that you're benefiting from all these gyrations. It's so all. It's, it's almost makes you want to giggle, like really if you just gone and done like work or something while you spend all this money, I mean all this calories on this, chasing your tail all over the place and trying to somehow beat the credit card company, you'd actually have some money. So no, no, no. And also Mark, let me tell you this and we have not done a study in the uk, but we have done the largest study of millionaires ever done in North America. We studied 10,167 of them. 89% of them, 9 out of 10 are first generation rich, meaning they started with nothing and they became millionaires. The number of those self made millionaires starting from nothing that became a millionaire working a system that remotely looks like yours is precisely zero. Out of 10,167. Not one said they played the airline mile game, the high yield savings versus repay old credit card and 30 days out and back and forth gyration game. And that's how I made my million dollars, Dave. Not one, not uno, not one. None, none. Zero proof text that your system causes wealth building. Zero. There's zero humans we have found that your system made rich. Zero, none. Was I unclear?

[George Kamel]

I think that's as clear as mud right there, Dave. Well, the key is the fallacy is that he wouldn't be financially stable without this. You've become financially stable in spite of the credit card gap. You decided that we're not going to have a mortgage anymore. Well why would you do that when you can make a spread on that? I mean you can, you know, reverse engineer this logic and just stay in debt the rest of your life if you think you can outsmart it. But clearly you value a debt free life. And I think this credit card game is costing you more than you think. And here's a good test. For one year use your own money and see if you don't save more than you have doing this credit card churning arbitrage.

[Dave Ramsey]

Well, gyration, here it is. The numbers actually on here. I got tired before the end of the email, but it's on here. Cash back to us has been $6,000 plus interest earned from the. Plus 8,000 from the interest earned. So 14,000 bucks over 10 years. Oh my God.

[George Kamel]

Yeah, that's over a 10 year period.

[Dave Ramsey]

You made $1,400 a year doing this. It's worse than I thought. $1,400. I mean dude, how hard is it to make $1400 in England? You really have done taken a lot of risk and played with a lot of bear traps hoping not to get your Arm ripped off by a bear trap in order to make 1400 a year. And here's the other thing, George. A guy that writes us an email that says this. The chances of him not doing it anymore or zero. He's going to keep doing it.

[George Kamel]

Yeah, he just wanted to, I guess, brag about how amazing.

[Dave Ramsey]

Well, or he wanted to be the subject of the latest Ramsey meme. I don't know, but it's a bad choice, dude. But the. Yeah. Part of the entertainment value of the show is you watch other people do something so stupid that you're entertained by it. And that's sometimes why people watch this show or listen to the show. Sometimes they do it to learn from what we're teaching here. And then other times it's just human beings are entertaining.

[George Kamel]

Entertainment value.

[Dave Ramsey]

I think you just fell in the second bucke. All right. Daniel's in New York. Hey, Daniel, how are you?

[Caller]

Hey, Dave. How are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So me and my wife are currently on baby step two, and we're strongly considering selling our car. Thing is, we have one unreliable car and this car is kind of our, you know, put the kid in the car, make sure it's safe. Yeah. We're just wondering if we should sell it and maybe even potentially have my stay at home wife go work part time.

[Dave Ramsey]

Okay. What do you make sure I make?

[Caller]

About 144,000.

[Dave Ramsey]

Okay. And how much do you own the good car?

[Caller]

29,000.

[Dave Ramsey]

Okay. All right. And the. The car that's not reliable is worth what?

[Caller]

I'd say maybe a thousand bucks.

[Dave Ramsey]

Oh, okay. So probably somewhere between there is a reliable car and there.

[Caller]

Yeah.

[George Kamel]

What could you sell the good one for? You owe 29 on it.

[Caller]

I owe 29 on it. We could probably sell it for around 30, 31, 32.

[Dave Ramsey]

Okay. And you don't you have any money saved at all?

[Caller]

So we have the emergency fund saved.

[Dave Ramsey]

The one. The $1,000 starter emergency fund.

[Caller]

That's correct.

[Dave Ramsey]

Okay, good. And what else?

[Caller]

Well, that's about it. And then the rest we're just paying off debt right now.

[Dave Ramsey]

Good for you. Okay, so you have a $29,000 card debt. What other debt do you have?

[Caller]

Just student loans. We have zero credit card debt. Student loans equate to about 70ish. 75.

[Dave Ramsey]

Okay. All right. And so you got $100,000 in debt. You make 100,000?

[Caller]

Yeah.

[Dave Ramsey]

And you live in New York City.

[Caller]

Yeah, just. Just very close. Yeah.

[Dave Ramsey]

Okay. All right. Expensive area, though.

[Caller]

Yeah. So we're actually lucky because our Parents own a house and we're actually renting with them. So we're not paying as much as we as the normal person would pay here.

[Dave Ramsey]

Okay, that's good news. Okay, well, here's the thing. If you guys can get out of debt and keep the car within two years, I'd be okay with you keeping it. I don't think you can. I think that'd be too tough. That'd be $50,000 a year on debt and somebody's gonna be making some more money. You or her. 1. What could she make working part time?

[Caller]

So she has an English degree and she. Before she became a stay at home mom, she was an English teacher.

[Dave Ramsey]

Yeah. Why does she do tutoring for 45 bucks an hour?

[Caller]

Hour. We were thinking about that as well.

[Dave Ramsey]

Yeah. That's not even a part time job. You're just doing that from home. I mean she can tutor 45 bucks an hour and work 10 hours a week and all sudden now we got some serious money coming in. That's. Yeah, I'm gonna do something like that for sure. And then you pick up what you can pick up. And then if you can keep the car, fine, but I'm probably gonna get rid of it and get me about a $10,000 paid for car.

[Caller]

Car.

[Dave Ramsey]

What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 42,000 businesses have future proofed themselves with NetSuite by Oracle, the number one AI cloud enterprise resource planning system. Ramsey Solutions uses NetSuite and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities with one unified business management suite. There's one source of truth for the visibility and control you need to make quick decisions. NetSuite's real time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you spend less time looking backward and more time focusing on what's next. And speaking of what's Next, download the CFO's guide to AI and machine learning at netsuite.com Ramsey it's free at netsuite.com Ramsey welcome back to the Ramsey show in the Fair Winds Credit Union studio. George Camel, number one best selling author and Ramsey personalities. My co host today Rex is in Los Angeles. Hi, Rex, how are you?

[Caller]

I'm good, thanks.

[Dave Ramsey]

All right, how can we help?

[Caller]

Yeah, so we're not on the steps yet. We've just. My wife and I just started reading you and listening to your stuff. We've got a bunch of debt, a lot of credit card debt. Some student loans we took over for my daughter, others to have a car loan, mortgage. We've also got a lot of money in investments. And if we're going to do this, should we just take that money in the investments and pay that stuff off or should we do the work to pay that down out of my salary? Is that taking the easy way out to just pay it off? That's the gist of the question.

[Dave Ramsey]

Yeah, it's a good question. Question. That's a fair question. How much debt do you have, not counting your home.

[Caller]

Including the car loans, everything? 167,000.

[Dave Ramsey]

And how much in the brokerage account?

[Caller]

844.

[Dave Ramsey]

None of that is retirement?

[Caller]

No. We have an additional 401k. That's about 85,000.

[Dave Ramsey]

Okay.

[George Kamel]

What was this account for?

[Caller]

The brokerage account for half of it was. Was when my dad died, we got an inheritance and the other half is just investment, sort of just making money for retirement.

[Dave Ramsey]

Okay, good. Except it's not in a retirement account.

[Caller]

Yeah, yeah, yeah.

[Dave Ramsey]

And what do you make a year?

[Caller]

About 100, 775.

[Dave Ramsey]

Good for you. And what do you owe on your home?

[Caller]

776.

[Dave Ramsey]

Okay. All right. Well, Rex, the thing that we teach and you guys have to decide as a couple if you're going to buy into that in order for the answer to your question to make sense. Okay. The thing that we teach and believe and we've proven to be true over 30 years of doing this is that when someone can get out of. Of debt and stay out of debt and live on a detailed plan that the both spouses are in agreement to where the money's going. And you've done a great job saving money. I mean, you're millionaires. You've done a great job saving money.

[Caller]

We got lucky on some of it.

[Dave Ramsey]

Yeah, maybe. But I mean, some of it was an inheritance. But overall, I mean, you've not done. You've not done horrible or anything like that. I mean, you've done a good job. So now you gotta ask yourself the question of what is the shortest distance between where I am with money and where I want to be? And we have found that the people that build the most wealth are those that get out of Debt, stay out of debt and live with a plan. Okay? Because when you don't have any payments, all your money's not going to stupid card loans and so forth, you can do stuff with it. Now if you can do that and commit to that and you're both in agreement to that and you get out the EveryDollar app or something like that and you say, okay, this is our plan and we're not going to buy anything else ever on debt because we believe the shortest distance between where we are and wealth is no debt. And so once we pay this debt off, we will never be in debt again, ever, for any reason. Not a big enough emergency, not a big enough need, not a big enough I got car fever, nothing unless I pay cash for it, I'm not doing it. If you're willing and able, both of you to commit to that, then yeah, writing a check and paying it all off is not cheating. The problem is if you don't have that level of commitment, like this pinky swear, spit shake contract, right. That we're never doing it again. You'll do it again. And next time you won't have any savings because you will have paid off all your other mistakes with the savings. And I don't want you going, I don't want you to not change your habits. So if your habits are permanently changing, you know, you can make a lot of money doing this, but if they're not permanently changing, it would be a vast mistake because you'll, you know, the recidivism rate is crazy on this stuff.

[Caller]

Yeah.

I mean, honestly, we've already done this with the credit cards. The problem is we didn't get rid of the credit card so we just racked them back up again.

[Dave Ramsey]

Tada. I rest my case, counselor. Yes.

[Caller]

Yeah, so, yeah, so that sort of leans toward try to pay it off, you know.

[Dave Ramsey]

Well, you know, you've, for your sake, it doesn't matter to George and me, but for your sake, you two adults have to become convinced that we're never going back.

[Caller]

Yeah, yeah.

[George Kamel]

And there's going to be pain either way. To watch that money leave that brokerage account is going to be painful to sacrifice for two, three years is going to be painful to pay it off.

[Dave Ramsey]

Yeah. And the fact that you did this thing with the credit cards tells you I, you know, maybe, maybe we get on a strict budget and we aggressively attack the debt and pretend like the brokerage account is not there for five months or six months and let's prove it to ourselves that we're through.

[Caller]

Yeah.

Yeah. Okay.

[George Kamel]

How old are you?

[Caller]

53.

[Dave Ramsey]

Okay, well, it's time.

[George Kamel]

And you picked up your daughter's student loans that she took out in her name or what?

[Caller]

Yeah, when she got married, we. Yeah, we just sort of just took those over for them.

[Dave Ramsey]

Yeah, well, I. I would, you know, I. Either way, I'm going to be out of debt very, very quickly with $175,000 income. But by quickly, I mean a matter of months. And so, you know, But. But you guys have to become convinced you don't have to be in pain to never go back. You just have to be committed to never go back. It's not necessary that. I've got a friend who was a heroin addict and he went through rehab and it changed his life, and he met God, and him and Jesus are best friends, and man, he stays away from. But his kids don't have to go through that to learn the lessons that he's learned. They can observe someone else and go, I don't want to do what my dad did. And the dad can look at his kids and go, I don't want you doing what I did. So you don't have to go through pain to learn. It's not necessary. It's a thorough teacher if you do do. But it's not like you have to go down the gauntlet and be hit with straps and whips or whatever to prove and. No, you don't have to. That's masochistic. We don't need to do that. But you do have to be committed to never going back, because otherwise it's pointless.

[George Kamel]

Yeah.

[Dave Ramsey]

And you're going to end up in worse condition.

[George Kamel]

If you guys agree, we're going to cut up the cards and close all these accounts. We're going to freeze our credit so it's much harder to go back into debt then I would say, all right, let's use these funds. You might pay some capital gains taxes on, on the growth, but you're going to clear the decks and be in a different place by Christmas. And now you can. You freed up all of those payments to now invest and give more and, you know, live life with a little more freedom and peace.

[Dave Ramsey]

So I think it's beginning to start working down that mortgage at that point, you know, and you need to start putting your excess savings when you get to Baby Step 4 In a retirement account in a Roth, not in just a brokerage account. The amount of money you're losing there in taxes is incredible.

[George Kamel]

Yeah, that brokerage account is for. You've maxed out all retirement options and we have nowhere else to go but non retirement investing.

[Dave Ramsey]

Right? But he's not got that problem with this income. So no, you, you can, you can get there. So yeah, I'm fine. Temporarily stop all investing, all saving and for six months we're going to go at this thing hard. We're going to open up an every dollar app. Both me and mom are going to get on it. We're going to get the credit cards out, have a plastic surgery party, light a candle. We're done. We're not doing this anymore. And we're 53 years old. We make too much money to be this stinking broke and have I'm sitting here with car payments and I make 175 grand. That's just. God, that's got to be disgusting. So get disgusted in a reasonable way and permanently change your behavior and then you got no problems.

[Caller]

Sam.

[George Kamel]

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[Dave Ramsey]

Top Questions people have about wills how do I know if I need a trust or if my estate is too complicated for an online will? If your estate is worth less than 1 million, getting a will online is probably a great option for you, by the way. Matter of fact, if your estate's worth Less than 10 million, it's probably enough. You don't have any need for trust much until you get up above that Unless you've got a special needs or something like that. Number two most often question, what do I need to start my will online? Making a will online or not involves a couple of decisions. Who do you want to get your stuff? Who do you want to take care of your kids? And who do you want to make decisions for you if you're incapacitated? Is an online will legally valid? Of course. By the way, wills are state specific. The laws that dictate estates are not federal law, they are state law. And so when you move you need a new will because your state may have different laws than the old state where you lived. And so different levels of different kinds of notary, different numbers of witnesses, different things you can do or can't do in a will, all that kind of of stuff. So why would I want an online wheel versus a traditional one? Less expensive, more convenient. Takes about 20 minutes to set up. If you go to Mama Bear legal forms, go to Ramsey Solutions.com wills quiz you can find out if an online will is right for you and we'll work you through the whole process. Jamie's in Newark, New Jersey. Hi Jamie, what's up?

[Caller]

Hey, how's it going? Dave, Pleasure to speak with you.

[Dave Ramsey]

You too. How can we help?

[Caller]

I try to be the brief as possible. I have a job. On paper it looks like the dream job. I work for a large pharmaceutical biopharmaceutical company here in New Jersey, one of the top biopharmaceutical companies. I make good money. I make $46 an hour. There's unlimited overtime, pension, 401k. But when I started we have a union here and it's a big campus so it's a pretty large facilities on site. And because it's a union I had to end up going to a department that I really didn't have a lot of experience in because I was low man on the seniori totem pole. So I ended up in the power in a place where I don't really have a lot of experience dealing with boilers and components, servicing different components that go to the boilers systems. And from day one my manager, he never took any initiative to make sure that I get I got fully trained up pairing me with other team members. Basically I have no manager. All he does is come in in the morning and ask everybody if they want overtime and he goes away. And I've tried to reach out to a lot of my co workers, a lot of the older senior guys who've been here for years, but the environment is so toxic. I'M the only minority on the team. And I feel like since I've been here for almost two years now, I can tell that they are purposely excluding me from all of the serious jobs. The jobs that I do that they lead to me that nobody else wants to do is something that I can do with my sleep, you know, and I can actually sleep at work. The job is I have, like I said, everything on paper looks good. They have a building here with a couch on the third floor. A lot of times I'm in that building on the third floor, sleeping in different buildings, looking at the computer like I. Like I actually have time to wait.

[Dave Ramsey]

Meantime, your soul is rotting.

[Caller]

Yes, sir.

[Dave Ramsey]

Yeah.

[George Kamel]

That's an expensive soul tax.

[Dave Ramsey]

Yeah. So are you. Have you been looking for something new?

[Caller]

Yes. I have an interview tomorrow for another large pharmaceutical company here in New Jersey. And I know what I don't want, and I guess I really answered my own question, but I know you deal with this type of thing on a daily basis, so I really wanted to get an expert like your. Like you. Your opinion, because I know it holds a lot more weight than probably even my own opinion on this topic.

[Dave Ramsey]

Very few, Very few people are actually happy be doing nothing or being underutilized. Most people, your spirit, your relationships, everything is invigorated by reaching for the stars. We are designed by our creator to create and be productive. And when we're not doing that, it is a soul tax. It takes a tax on your soul. Soul. And so that's what you're discovering. And so this idea that if I got paid for doing nothing and sitting around doing nothing is somehow a wonderful thing. It's not really wonderful at all. It's really horrible.

[Caller]

I agree.

[Dave Ramsey]

And so I agree with you that. Yeah, but I don't think you have to, you know, you don't have to run out the door. They're not burning the building down. They're nobody in danger. There's. They're not being mean to you. It could be racial. It could just be that they're just being union jerks, you know, And I don't care. It doesn't matter to me which one it is. I'm still getting out of there.

[Caller]

I think it's a little bit of both. I remember one of my co workers.

[Dave Ramsey]

That'S probably true.

[Caller]

He's made a remark about knuckle draggers. I hope they hire some more tech. So they keep hiring these knuckle draggers.

[Dave Ramsey]

Yeah, but that's not a racial thing. That's just. That's Just a caveman. Knuckle dragger is just a dumb person that doesn't know anything. It's just a caveman. So, you know. But I, you know, either way, it doesn't matter. You've solved the problem. The riddle is I gotta go. But what I don't have to do is go running out the door and make $20 an hour while I'm making 46 right now. So I'm gonna sit here for a minute, no pun intended, and look for a job. Right. Instead of sleeping on the couch, I'm gonna be looking for a job.

[Caller]

Right. That's what I've been doing today, the last couple weeks. Every day, I update my search. Yeah.

[Dave Ramsey]

And I, you know, I don't know if you felt. You felt backward into being spoiler guy or if that was what you intended to do. What is it you really want to be 10 years from now? If you could do anything you wanted to do, what would you do?

[Caller]

Validation. Equipment. Validation. Qualification.

[Dave Ramsey]

Okay, so you. You enjoy. You enjoy. And you're good at working with your hands, and you can, in your mind, you can see how things work and how they're put together.

[Caller]

Yes, sir.

[Dave Ramsey]

Very good. I like, like it. Well, Ken Coleman would like what you're saying. Mike Rowe would like what you're saying. I think you can make a lot of money, but you're not gonna make a lot of money if you're dragging your knuckles.

[Caller]

Right, Exactly.

[Dave Ramsey]

And so you're not gonna have home energized. See, I come home from doing this, I'll do about five and a half hours on the microphone today. Different podcasts and different things I've got to do inside the building today. And I'm 65 freaking years old, and I come home energy energized because I'm doing stuff that matters, stuff that I care about, and I'm pushing the edge. I'm having to use every. Every ounce of everything that I am to make sure I help you guys, give you the right answers, all that kind of crap. And so, yeah, hang on. We'll send you a copy of Ken Coleman's book, finding the work you're wired to do. But, George, life is just better when you're doing something that you have to reach for. Yeah, it's just out of reach.

[George Kamel]

It's funny because it's almost worse when you're paid well to do it, because you go, well, I'm an idiot to leave this. No, you're an idiot to stay, because if you're not treated well, you're undervalued, you're bored. There's no growth plan. Like Dave said, eventually your soul is going to pay the price for it. And so we believe that you can do the work you're wired to do and get paid well to do it. And naturally you're going to grow in that area because they're going to see your enthusiasm and your talent, your excellence. So we're rooting for you, man, to get to that next thing.

[Dave Ramsey]

It's a pretty crazy world when you just show up and care and work hard all day long and that makes you stand up out. You don't even have to be that good. You just gotta care, have brushed your teeth and work hard all day long.

[George Kamel]

Just showing up in good hygiene goes a long way.

[Dave Ramsey]

I mean, it's just. It's amazing.

[George Kamel]

That's what I've done.

[Dave Ramsey]

It's the world. Well, it's working for you. Your hair is great. Thank you. But the.

[George Kamel]

I wanted to say. I wish I could say the same, but.

[Dave Ramsey]

All the hair jokes go all the way around the horn before they stop. Huh? Okay, I like it. Seriously, though, the. The striving for excellence, the striving to do to reach a level you've never reached before is what gives life to you. And so anytime someone's just sitting and listen, things are either growing or they're dying. There's no in between. And so this job, Jamie, that you got is going to get worse. It's not going to get worse.

[Caller]

Better.

[Dave Ramsey]

It's dying. It's going off the cliff.

[George Kamel]

They made it clear.

[Dave Ramsey]

Yeah, it's pretty ridiculous what he's describing. And I don't think he's being weird. I think he's probably got a pretty clear. Pretty clear action of what's going on there. So, yeah, I'm, you know, I set a goal that within a. Within six months to a year, I've got a better job making $52 doing something where the people respect me, I respect them. And we have to work really, really hard while we're there. And I come home with a callous on my hands because I've actually been turning a wrench all day, not sleeping on the third floor couch.

[George Kamel]

Yikes. That scares me. That's what's happening in pharmaceutical companies in America.

[Dave Ramsey]

Well, apparently the maintenance team in the building at the farm, he's working on the boy. The union workers still. It's just the whole thing is. Wow.

[Caller]

Sam.

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[Dave Ramsey]

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[Dave Ramsey]

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[Dave Ramsey]

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[Dave Ramsey]

In the lobby of Rock Ramsey Solutions on the debt free stage. Christopher and Brittany are with us. Hey, guys. How are you doing?

[Caller]

Well.

[Dave Ramsey]

Dave, welcome. Welcome. Where do y' all live? We're from Sacramento, California. Cool. Welcome to Nashville.

[Caller]

Thank you.

[Dave Ramsey]

And how much debt have you guys paid off?

[George Kamel]

Paid off about 412,000.

[Dave Ramsey]

All right. How long did that take?

[Caller]

28 months.

[Dave Ramsey]

28. All right, very good. And your range of income during that? Two and a half years.

[Caller]

Years.

So we started at 215,000. We went up to 350,000. And now we've gone back down to 250. So I can be part time and stay at home with our newest baby.

[Dave Ramsey]

Love it. What do y' all do for a living?

[George Kamel]

I do plumbing.

[Dave Ramsey]

So I work for a general contractor. Plumbing contractor. I did H Vac 2 for about 20 years. Wow, cool. Yeah.

[Caller]

And I'm a nurse. A nurse educator and train new nurses.

[Dave Ramsey]

Gotcha. What kind of Debt was the 412,000?

[Caller]

Thousand everything. Student loans, kids, braces, personal loans, time shares, phones, taxes, all the things.

[Dave Ramsey]

Wow. Everything. Did mortgage too or.

[Caller]

No, still got a mortgage. We're in California. We got a little while, but we're good for you.

[George Kamel]

That's our next.

[Dave Ramsey]

Now you're free though. 12,000 worth of normal? Yes. Wow. How long y' all been married?

[Caller]

Gosh, almost a few years.

[Dave Ramsey]

Yeah.

[Caller]

Three and a half years. We started just before wedding, so we had some great days.

[Dave Ramsey]

So you both brought crap into this? Yes, and so you've been married three and a half and you say, all right, job one, we're cleaning up the mess.

[Caller]

Yes, yes.

[Dave Ramsey]

Not living like this. Get a fresh start.

[Caller]

Yeah, we had a really hard time with a lot of car problems, deaths in the family, different things. And it just pushed us to a point where we were, like, having to borrow our kids cars while we had one sitting in the driveway. Need a new transmission. And so we were just, like, driving to figure out, how do we get out of this and change their lives.

[Dave Ramsey]

We make too much money to be this broke.

[Caller]

Absolutely.

[George Kamel]

What was the bulk of the 412?

[Caller]

Student loans, probably about 100 or so. Some old stuff we had from previous marriages, another couple hundred. So a lot of money.

[George Kamel]

Was it just like collecting? Collecting to where you just went like, I'm in denial at this point? Yeah, it was like, what's another three grand for braces on top of that?

[Dave Ramsey]

Exactly.

[Caller]

It was zero percent for braces. And so we didn't pay outright. And then when we were able to pay it off, it was just, I mean, trying to call to pay it off. They don't let you call and pay it off. I don't know if, you know, it takes six to seven times to call and, you know, say, we need to.

[George Kamel]

Get your address them to take your money.

[Caller]

Yeah, it was really rough the last month and a half.

[Dave Ramsey]

I'll tell you, they like you owing them money. Who knew? Wow. Very cool, you guys. Very cool. So how did you get connected to the Ramsey stuff?

[Caller]

So I learned about you back in 2009 when my youngest son was born. He's 15. And I mean, we've heard. We did FPU. You know, I talked to you on the show before I went to nursing school to talk about, should I go to the Air Force, student loans, what do I do? And then I became a single mom. And so when I did that, you know, I said, okay, I'm gonna have to take student loans, because I figured I knew better than you did. We were davish for a while, and then 28 months ago when we got our wedding, and we both just said, enough is enough. And so we did a couple more fpus at home, downloaded every dollar, and we have not done a month without every dollar for the. The last 29 months.

[Dave Ramsey]

So.

[George Kamel]

Wow, that's incredible. So it's been. You've been aware for, like, 16 years, but life kept happening.

[Caller]

Yes.

[George Kamel]

And so when you guys got married, you're like, I know just the guy.

[Dave Ramsey]

Yes, you did. We had spreadsheets of all the different debt we had, and it was a long list. Scary.

[George Kamel]

No more spreadsheets. I hope you've deleted the Excel.

[Dave Ramsey]

So, Christopher, you knew when you were getting married, you were getting into this, right? Oh, yeah. But I knew she was worth it. So I guess.

[George Kamel]

Correct answer.

[Dave Ramsey]

Yes. Not into this, all the debt mess, but into this. I'm going to go hardcore together. Yes.

[George Kamel]

Yeah.

[Dave Ramsey]

She worked her butts off. She worked her butt off to get a lot of the debt done.

[Caller]

A lot of side hustles.

[Dave Ramsey]

Yeah, I bet. I bet. Well, congratulations, you guys. We're very proud of you. How's it feel to be free? Yeah, it's a relief.

[George Kamel]

So the main thing is we're just.

[Dave Ramsey]

Going to focus on not getting back into debt. And so it's just saving and saving. If we want to take a nice vacation, then we have. Either we have the cash to do it, or we're not doing it. So we're. We're definitely on the same page on that. I love it. I love it. Well, congratulations. All right, when someone says, how do you pay off $412,000 in 28 months? That's stinking impressive. Yeah. What do you tell them? The key to getting out of debt is budgeting. Working Every dollar for 29 months.

[Caller]

Every dollar. Making sure every dollar has a name. We logged our kids in. They have their own every dollar. And, you know, making sure that you know where your money's going and make sure that you understand the principles of it so that way you don't ever do it again.

[Dave Ramsey]

Yeah. And we're teaching them to go through college debt free, too, because of you.

[Caller]

Two in college, working three jobs each, you know, working their way through college. And one about to go, and they've all paid cash for their cars. I'm impressed by them and how well they've done.

[Dave Ramsey]

Wow. Very cool. You really have changed your family tree. Yeah.

[George Kamel]

We say more is caught than taught. And they've been watching mom and dad just hustle to get rid of this debt. So, like. Well, there's work ethic right there. They're catching that.

[Dave Ramsey]

Sure.

[George Kamel]

What was the hardest thing to cut out of the budget or the biggest thing you guys cut to make this happen so quickly?

[Caller]

We were talking about that last night. So I refused to give up kids sports for them because it was such a big thing for them. So we'd actually argue about golf, and instead of doing, like, a big golf round, we do a little golf round, and we, you know, the grocery budget. I hear people talk about how much they spend. We're a family of eight, and my budget's $1,200, so.

[Dave Ramsey]

Whoa.

[Caller]

That's pretty good.

[George Kamel]

Some of it.

[Dave Ramsey]

That's for a Great Dane dog food, so.

[Caller]

Yes, we have the Great Dane puppies.

[Dave Ramsey]

Of course you do.

[George Kamel]

Of course they can eat.

[Caller]

We have three.

[George Kamel]

Oh, my goodness.

[Dave Ramsey]

They eat more than the kids. Wow. That's incredible.

[Caller]

Costco.

[Dave Ramsey]

Yeah. Very cool, you guys. Very cool. So the budget is the deal. And eating it, and you're. You must be cooking a lot from scratch.

[Caller]

As much as I can, yeah.

[Dave Ramsey]

As a nurse, you know how good that is, right? The nutritional value and everything else, completely different, so. Well, way to go, you guys. Way to go. And you brought all of them with you to celebrate. All right, bring them up. Let's hear all the names and ages. Come on up, guys. Have a big celebration here. The family tree. Look at the family tree. Has changed.

[Caller]

Brianna's 19. We have. Peyton's 19. Memphis is about to be 18. Jackson's 15. Ava's 13. And we have Noah, who's eight months.

[Dave Ramsey]

Way to go, Noah. You did it, man. You joined the clan, buddy. Love it.

[George Kamel]

So cute.

[Dave Ramsey]

Beautiful. All right, Christopher and Brittany and the gang from Sacramento, California. $412,000 paid off in just 28 months. They were working like crazy people living daily on a budget, eating at home. 215,000 to $350,000 income. Count it down. Let's hear a debt free scream.

[Caller]

Three, two, one.

[Dave Ramsey]

We're debt free.

[Caller]

Love it.

[Dave Ramsey]

And the kids are going to school debt free. And they're paying for their cars debt free. And family trees changed.

[George Kamel]

That's impressive. And at this age, they. They saw the sacrifice, so they're going, yeah, I'd like to avoid that.

[Dave Ramsey]

Yeah, I don't. I think I'll avoid that.

[George Kamel]

And yet they survive the sacrifice of mom and dad for two years. A lot of people say, well, you know, I don't want to. I don't want to affect the kids.

[Caller]

Kids.

[George Kamel]

Like, maybe it should affect the kids so they don't fall into the traps that we fell into.

[Dave Ramsey]

Yeah, well, they. They did it. I mean, they pulled it off. And here's the thing. What, what you saw, if you're watching them and if you go back and watch this, you can pull it up on YouTube if you. Or. Or Spotify, where you can see the video. Either one. And what you. What you'll see is you see their body language, and it just says, I've had it. Not living like this anymore. They were just very resolute about that. We're going to do this. We're not going to go back. We're never going to be there again. And life's too short, and they've got second marriages they're going into. And they finally just said, okay, that's it. We're pulling the plug on stupid.

[George Kamel]

Let's clear the decks. Yep, that's a beautiful thing. And it's never too late. That's impressive.

[Dave Ramsey]

Yeah. And don't tell me if you got a bunch of kids, you can't do it. Don't tell me if you live in California, you can't do it.

[George Kamel]

They just proved you wrong.

[Dave Ramsey]

All these things. It's like, hold my beer right? So you can do it, you can do it. But it came down to, I mean, you could just tell looking at Brittany, Brittany put in some hours as a nurse. I mean, and look at these numbers with the income dropping off. You can see that the number of hours she was working as a nurse to cause this to happen. And oh, by the way, just had a baby. And oh, by the way, you know, and there's every excuse in the world, but none of them mattered. They still went and paid off $412,000 in just 28 months.

[George Kamel]

I mean, you blink in, 28 months is going to go by. So the question is, do you still want to be in $400,000 of debt 28 months from now, or do you want to just decide that today's day one of a journey of 28 months?

[Dave Ramsey]

Yeah, but I mean, the madder you get, the deeper you cut, the more resolute you are. The deeper you cut, and then the faster you get out, and then the higher the probability is that you make it and you stay out. The faster you get out, the deeper you. The deeper you cut, the faster you get out, and the higher the probability is you get out to start with and then stay out. All of those things fit together and everything we've seen over the last 30 years in doing this, and they've got all of it. That's so this family of winners right here for sure.

[George Kamel]

Very impressive.

[Caller]

Sam.

[Dave Ramsey]

Owner or a leader in small business? And you've got a question about running your business, about leadership, how to lead the team, manage the money, grow without going crazy. Family business questions? I'll take your call personally. I do a top rated podcast on small business and leadership called Entree leadership. And you can call us. Here's the number. You can be part of that show. 8449-4584-4944-1070. Or you can head over to entreeleadership.com ask and drop us a note there. We'll call and set you up as a caller on the Entree Leadership podcast. Ryan is with us. Ryan is in Charlotte, North Carolina. Hi, Ryan. How are you?

[Caller]

Good. Good afternoon, Dave. Thanks for taking my call.

[Dave Ramsey]

Sure. What's up?

[Caller]

So, question is, is I am being told by my ex wife that I should cash out my 401k to purchase a home. And the reason being is when we divorced about 8 years ago or so, she basically took half my 401k and parlayed that into purchasing a home 5 years later, sold that home for a good profit and so now and then. And then bought another one. And so she said, hey, you know, you need to get out of. Stop renting and you should really put that. Some of that money into real estate.

[Dave Ramsey]

I'm so confused. Why would anyone ask their ex wife for financial advice?

[Caller]

Well, I saw what. I saw what she had done with.

[Dave Ramsey]

No, you didn't. You saw what she said she did. When she cashed out half of that 401k, she got charged a 10% penalty plus her tax rate. She borrowed this money at 35% interest. By the time she flipped this house and made money, she didn't even make money. She's so full of crap. She's a Christmas turkey.

[Caller]

I see that. With the house that was purchased and sold.

[Dave Ramsey]

I mean, you didn't see all the penalties and taxes she paid on the stupid withdrawal from the 401k that negated any profit that she made on the 400 flip.

[Caller]

Yeah, that is true.

[Dave Ramsey]

Okay. Because this woman talks out of both sides of her head. That's why she's called the ex wife.

[Caller]

Yeah.

Although she is in a house and I'm still renting, so I got a. Yeah.

[Dave Ramsey]

And what she paid for it was a dear price.

[Caller]

Yeah.

[Dave Ramsey]

And sadly is probably so mathematically challenged she doesn't even realize it.

[Caller]

Yeah. It's.

[George Kamel]

It's going to take her a lifetime just to catch up on retirement now.

[Caller]

Yeah.

[George Kamel]

So how much do you have in retirement?

[Caller]

Me personally now? About 85.

[George Kamel]

And what do you make?

[Caller]

130.

[Dave Ramsey]

And how old are you?

[Caller]

50.

[Dave Ramsey]

Yeah. Okay. If you cash out your money, they're going to charge you a 10% penalty and plus a 25% tax rate. It's like saying, dave, I want to borrow 35% interest. I want to borrow money at 35% interest to buy a house. Please don't do that.

[Caller]

No, I agree.

[Dave Ramsey]

That does not put your face under the smart column in the dictionary. Okay? So no, don't, don't do that. And, and be careful who you're listening to for financial advice in the future. You know, it's like watching some influencer on Tic Tac and they're on there doing their thing and they look like all they're running is the highlight reel. And you see a private jet that they rented and don't own and. But I can teach you to buy real estate. And I've got a jet. Yeah. That I rented 10 minutes ago. It's not even your own jet. Come on, dude. You know, and, and then you go buy a $3,400 kit from them, which is where they actually make their money. So now just. No, no, be careful who you're listening to for money advice. What you want to do is look at people that are understated and they're driving a Toyota and they don't have any flash or any bling and their lives are really solid and steady and predictable and sustainable and happy, high quality relationships. These are called mature individuals. They're not doing anything to impress others. They're living a life of quality. And if someone happens to notice, they probably wouldn't even notice. And these are called millionaires. And if you can find one of those and actually get them to admit it and then talk to you, they'll teach you the real stuff about money. It's hard stuff like live on less than you make, save and invest. Be generous, live on a plan.

[George Kamel]

Don't rob your 401k to get into a house. That kind of stuff. Yeah, that's on the.

[Dave Ramsey]

Don't listen to your ex wife for financial advice. Alexi is with us in Sacramento. Lexi, how are you?

[Caller]

Hi. I'm good. How are you doing?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

So I recently discovered your podcast. I'm a new listener and I recently started my career. I graduated college last year. So I've officially created like a monthly budget, paying off my student loans and all of that.

[Dave Ramsey]

Good for you.

[Caller]

But I was wondering. Thank you. On the best approach, recommendations for all the extra money that I have. I recently learned about high yield savings accounts. So I was just wondering if that's the way to go or where to put my emergency funds or cash I need like easy access to.

[George Kamel]

I love it. You are thinking perfectly. A high yield savings account is what we recommend for any short term savings goals like that are happening in the next one to three, four years. And your emergency fund and That'll help it at least kind of keep up with inflation because right now the rates are about, you know, three and a half percent. And if you want a great one, we got a great partner with Fairwinds. And so if you go to fairwinds.org Ramsey, they have a smart bundle just for our fans that has a checking account and a savings account with a great rate.

[Dave Ramsey]

Yeah. So High yield savings is where you would start for something like George said, for your emergency fund fund, which should be three to six months of expenses. And of course you're staying out of debt completely. So we're saving up and paying cash for things. And then beyond your emergency fund, anything you're wanting to do with money in the short term now, when you start thinking long term for retirement, then we're going to move towards mutual funds and some other things. But yeah, George is right. This new partner of ours, they've been with us for about a year and a half and they just became the studio sponsor just about a month ago. And we spent a lot of time with the people behind the scenes are solid people and the product is solid. It's a good high yield savings account at Fair Winds Credit Union. So just look them up. Fair Winds, like the winds are fair. All right, here we go. Riley's in Houston. Hey, Riley, what's up?

[Caller]

Hi, Dave. I appreciate you taking my call. Sure.

[Dave Ramsey]

How can we help?

[Caller]

Yeah, so I have a question in regards to paying off student loan debt. Currently I have about 68,000 in total student loan debt. I do have quite a bit of savings and I'm just curious on how to tackle this pay it in bulk, which I sort of have a feeling that you're going to say or reinvest the savings to use the interest to make payments to just kind of don't know what route to go.

[George Kamel]

We would recommend the debt snowball method, which means you're going to knock out the smallest balance first. So how much do you have in savings?

[Caller]

I have about 95,000.

[George Kamel]

Dude, pay it all off today. Why have you waited? What's holding you back?

[Caller]

Honestly, it's just that mental aspect of not having that much in savings.

[George Kamel]

You don't, you have $68,000 in debt that you owe. So mentally I would detach and go, I don't actually have 90 something thousand. I have, you know, 29,000 because I owe, I took out. I sign on the dotted line saying I'll give you this money back and dude, you can be done today and not pay another dime in interest and Be free.

[Dave Ramsey]

Hey riley, where'd the 95 come from?

[Caller]

Just saving some work. Yeah.

[Dave Ramsey]

And if you, if you have 29 tomorrow and no doubt you could save even more.

[Caller]

And that is recommended. Rather than trying to invest that 100%.

[Dave Ramsey]

The number of millionaires that we've interviewed in all of our research that said I borrowed money on my student loans and made the spread and caused me to be a millionaire is precisely zero. No one use, no one actually does what you're talking about to build wealth in the real world. It's all theory on TikTok tech.

[Caller]

Okay. And this might have came at a great time because I was trying to do an application and income driven application online. And prior to submitting I was hoping that I could get into this call and try and just figure out the route because I know what my monthly payment would would be at. But obviously it be in that payment for X amount of years.

[George Kamel]

So I wouldn't do income driven anything. I'd get rid of the debt. All you're doing is kicking the can down the road, dragging this thing out longer. You've worked hard to save and that's gonna be painful to let go of that. But man, it's gonna set you free when you have those payments back in your life, back in your bank account.

[Dave Ramsey]

Well, and you got this monkey off your back and it's in this case a gorilla on your back. Yeah, get him off and you're gonna feel, you're gonna feel funny. You feel like you lost 300 pounds.

[George Kamel]

Be weird and you'll stack up that savings again real quick with no payments.

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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, George Camel Ramsey, personality number one best selling author is my co host today. Catherine is with us in Phoenix, Arizona. Hi Katherine. How are you?

[Caller]

Good. I have a question on a. We have a variable life insurance, which we know now we should have never had that probably eight years ago. We took out to try to save my husband's business that we ended up. Ended up having to sell off to somebody else. And so there's really nothing left in there. The cash value that's Left is like $4,800. I just didn't know, like, because we've kind of just been hesitating and then the people that have had it, they've kind of just said, leave it there.

[Dave Ramsey]

Oh, I bet.

[George Kamel]

I don't know who sold this to you? Who hates you that much?

[Caller]

Actually, it was a close friend that when we first had our first baby that she told us. And of course, because she sold it, so. So we've just kind of.

[Dave Ramsey]

She's out. She's out of the business now, right? Yes, they usually. They usually last about two years and then they're gone, right? Yeah.

[Caller]

So we have like some term life also.

[Dave Ramsey]

Okay, so what does your husband make a year?

[Caller]

What, 275.

[Dave Ramsey]

And how much term life does he have?

[Caller]

The term Life is about 800,000.

[Dave Ramsey]

Okay. All right. Is he healthy?

[Caller]

And then I have like, I have like 250. Yes and no, he's 60. But he has had. He has diabetes and has some issues.

[Dave Ramsey]

But diabetes is a big one when it comes to life insurance. He. All right. And you guys have no money. It sounds like you've been through hard times.

[Caller]

Yes.

[Dave Ramsey]

Okay.

[Caller]

Yes.

[Dave Ramsey]

And you don't have any children left at home?

[Caller]

I have a 1. 16 year old. I do have a 16 year old.

[Dave Ramsey]

So his concern today is if the 60 year old dies, he leaves a wife and he makes. What's your household income?

[Caller]

You said about 275.

[Dave Ramsey]

He makes 275.

[Caller]

Yes.

[Dave Ramsey]

And do you work outside the home?

[Caller]

No, no, no.

[Dave Ramsey]

And so that you lose a $275,000 income if he dies today. And. And he leaves you 800,000 bucks.

[Caller]

Right.

[Dave Ramsey]

Okay.

[George Kamel]

Which is just over, you know, two and a half years of income.

[Dave Ramsey]

If that was invested at 10%, it would make you 80,000. So you're going to be short about 200,000 based on the way you're currently living. So if he was young and in good shape, I would tell him to get, you know, two and a half million on him, including the 800. So we back that out. But so, you know, one and a half or so, give or take. But he's not. And if I suspect at 60 with the diabetes. It's going to be pretty expensive to get some term insurance. But the variable life insurance is, it's not much in coverage as it's not very big policy. Right?

[Caller]

No, it was when we first got it it was like he had 500,000 and mine was. But where we took out it was probably like I said like eight years ago. It was like 70,000 we had in there and we took all that out to try to save the business. But we all we put it's like $275 a month.

[Dave Ramsey]

I'm like yeah, but I'm talking about the tax benefit if he. What do they write check for?

[Caller]

Oh, that's only 350.

[Dave Ramsey]

Yeah, yeah. And 275amonth for 350 even for a diabetic 60 year old is, is ridiculous.

[Caller]

So that's where we're like, we're just throwing that money away at the like.

[Dave Ramsey]

Yeah. So you can cancel that if you can afford to live on 800 grand if he dies tomorrow. Okay. If you instead another route you could go before you could cancel it. You could go to Xander Insurance, talk to them and see if they can make a market mean if they can get a company to cover him and how expensive it will be and try to buy me, try to buy a million on him if you can. I had some when I was in my late 50s and 60s and right around 60 years old. Just because Swi Sharon wants it. I didn't need it but my wife wanted that instead of another diamond and so I did that and I. But I'm in really good shape and don't have a single single medical issue. And so, and I don't, I don't. I could lose some weight but I don't meet the obesity markers. So I can get that. I could get the insurance. And so that's, that's the things that will fight you at that age now. So go to Xander ZanderInsurance.com or call them and tell them you talk to us on the air.

[Caller]

So that's what I wondered about that.

[Dave Ramsey]

See if you can get insurance to make you more comfortable and then if you can, it's an instantaneous yes to cancel this. If not, do you want to keep the very, very, very expensive insurance? I probably don't.

[Caller]

Okay.

[Dave Ramsey]

I'm probably going to take some of that $275,000 income and start banking it aggressively knowing that I don't have enough insurance.

[Caller]

Okay. That's what I wanted to know what to do about that.

[George Kamel]

What were you going to do with the money you cashed out?

[Caller]

Well, I was wanted to know like means because you hear all this stuff about putting stuff into gold. So I didn't know if that was something or put it. Where should we put it? Yeah, I would just only like $4,800.

[Dave Ramsey]

Well number one, I'd make sure you're out of debt. But number two, we don't buy any gold. Gold has not got a good track record long term as a return on investment. Instead I would just buy good growth stock mutual funds with my investing. But y' all need to be doing a lot more than that. Making 275, 4800 bucks ain't gonna save you, you know, not in this situation. So it's, it's just, you know it's a smart thing to do is knock gold and go to some mutual funds. But you know, you need to, you need to be laying out a game plan where you're saving like $100,000 a year. And you do that for five years. Now you got a half million dollars on top of that 800. Now we're starting to get there without insurance, without any more insurance. Starting to become self insured than the original 800. Yeah, but you got to rebuild after the business failure. Rebuild some net worth and some wealth for survival for you and the 16 year old. And those are the routes to go go. So guys, just to recap. The life insurance world is polluted with bad products. There's really only one. All the people that are not in the insurance business, all of us that are financial people, that run numbers and are math people, all the financial people say to buy term life insurance. The best deal on term life insurance is 15 to 20 year level term. It's a level premium and you should have 10 to 12 times your income on you if you have a family counting on you for your income. So if you make 100,000, you need somewhere around a million dollars, million two, something like that. And then if that 34 year old wife of yours with three little kids is left behind and you don't have that 100,000 coming home, she could take that million million invested. It'll create 100,000 in income perpetually until the kids are grown and gone. And you can invest in, you know, we have replaced you. So if you don't want to get too much, have sleep with one eye open. But if you're 34 and in good shape, term life insurance costs that is like the cost of a pizza. It's ridiculously inexpensive. To make sure your family's taken care of ridiculously. And I just read a letter to our staff meeting this morning. A 52 year old that had life insurance on her and they had just paid off a million dollars in debt four years ago and they were on vacation, she had an aneurysm and was gone in six minutes and left another million behind in life insurance. Now because they'd done the stuff that we teach over and over. So it's just not very expensive if you go and do it right. But this investing inside of a life insurance policy like these stupid variable life and whole life insurance policies are an absolute rip off. Never do that. Many of you listen to the Ramsey show because you're sick and tired of getting nowhere with your money. You work too hard to live paycheck to paycheck with no money in the bank. But here's the deal. Just listening to the show won't change that. If you want different results, you have to do something different. We've helped millions of people save money, ditch debt and build wealth. And you can too. But you got to have a game plan. And that begins with our get started assessment. Go to ramseysolutions.com start now. Take the free quiz and get your free step by step action plan. If you've had it with money stress and are ready to take control of your money for good, go to ramseysolutions.com start now. Well, as you've heard, the Fed has cut rates for the first time all year. 15 year fixed rate mortgages have dropped to the lowest we've seen in 11 months. If you're financially ready, now is a great time to buy or sell. Buying an affordable home you love is possible if you work with a Ramsey trusted real estate agent. We have vetted agents to be high octane, high protein. Get her done people. And you can find one of these trusted, trusted Ramsey trusted local pros for free@ramsey solutions.com agents. Time to do a real estate deal, boys and girls. I love it. Caleb's in Dallas. Hey Caleb, what's up?

[Caller]

All right, thanks Dave, for taking my call. George. Hey, so I'm on baby step two. I've got roughly 65,000 in debt. I make somewhere between 80 and 85,000 a year. And my wife, she's in college at the moment. I'm going to get her nursing degree.

[Dave Ramsey]

When will she be finished?

[Caller]

She will be finished this time next year.

[Dave Ramsey]

Oh good. Okay.

[Caller]

So she, she actually it's a good thing. She, she was very blessed to be able to take Advantage of her dad's GI bill. And we also have, I believe it's called chapter 1132. Maybe since we live in Texas, she's able to get money every month. That's income on top of.

[Dave Ramsey]

Wow.

[George Kamel]

So she's going to school debt free and getting paid.

[Caller]

Right. So my question is, I've got a thrift incentive plan at work. It's not a traditional retirement plan, but it is after tax, I am required to put in a minimum of 2% in order to receive profit sharing. Historically, the last three years, first year that I was able to receive was 10%, the next year was 12, and then last year was 15% of employee sales. I'm just wondering, should I continue to contribute that 2% in order to get that profit sharing? Because we're on track this year to get 15% again.

[Dave Ramsey]

Normally I wouldn't. Those numbers are a bit ridiculous, so I probably would.

[Caller]

Right.

[Dave Ramsey]

Matter of fact, they're the most ridiculous numbers I think I've ever heard. In a good way.

[Caller]

Right. I'm very blessed to be where I work. And I can thought I was astounded by the. I've never seen a retirement plan that. That works as well as this one does.

[Dave Ramsey]

I haven't either. And I've been doing this a long time. But that's. I mean, you put in two, you get 15. That's kind of crazy. Crazy good. And so if you put in two and you're gonna get three, I just pass for now. But I mean, and all you people that get matched 3% on your 401k, I wouldn't. I wouldn't do it. I would stop your 401k temporarily and work your baby. Step 2. We always have said that for decades and it's worked to get people out of debt, but that, that 2% is not enough to bother with one way or another. And the two for 15 trades, probably a pretty good trade. What are you thinking, George? Yeah, what am I missing?

[George Kamel]

Are you aggressively looking to get out of this debt? Making 80 to 85. How much can you throw at this thing per year or perhaps month?

[Caller]

So I am the first. First thing is I'm on track right now to get out of debt now. And since this past month has passed. A year and eight months. That's what I've calculated.

[Dave Ramsey]

That's without a nurse's income.

[Caller]

Right? Exactly.

[George Kamel]

That'll speed up a year from now. That'll. It'll just, you know, really inject some life.

[Dave Ramsey]

So you ought to be done a little over a year. Pretty Quick.

[Caller]

Right.

[Dave Ramsey]

You know, as soon as she gets that going now what is she making income wise from this program?

[Caller]

So chapter 32, the VA benefits, I think it, it depends on, you know, how often she's in class. But when she is in class full time, she's. It's like 12 to 1500amonth.

[Dave Ramsey]

So why would she not be in full class full time?

[Caller]

Well, some of this program doesn't. Like the summertime for instance, she doesn't have classes all day. She only has classes of, you know, two to four hours out of the day versus right now. Since she's full fledged in the program, she is getting, she's getting full time student hours, so.

[Dave Ramsey]

Gotcha. Okay, so you got another 15,000 or so coming in income from her while she's in school, right?

[Caller]

Yes, sir.

[Dave Ramsey]

Yeah. So you're making about 100 and you got 65 in debt. Yeah. You need to be debt free. Yeah. The year and eight months sounds really good. And if you, she passes her boards right quick and lands in a, in a payment in a paying position right quick, then yeah, I think you're going to be in really good shape and it'll be sooner than a year and eight months. I like everything you're doing, Caleb. Sounds like you got it dialed in. Keep it up, keep it up. I'm glad you're paying attention, George. You know, it keeps coming back to if you pay attention, you win.

[George Kamel]

Yeah. If you know your numbers, what you're.

[Dave Ramsey]

Looking at, those stupid interview questions we get sometimes. It's like, what's the largest problem Americans have with money? They want us to say student loans or credit card debt. And my answer is always not paying attention.

[George Kamel]

Living in LA la land in denial.

[Dave Ramsey]

They're just wandering along like Gomer pile on Valium, you know, and they just wake up at retirement. Shazam. I'm broke, you know. Oh my God. None of you people know what that is. Look it up on YouTube. Okay. Anyway, Christina, Christiana is with us in Chicago. Hi Christiana.

[Caller]

Hi guys. Thanks for taking my call.

[Dave Ramsey]

Sure.

[Caller]

So I have a question about baby step six and seven. So my husband I are fortunately there.

[Dave Ramsey]

Yay.

[Caller]

Yeah, it's exciting. So my question is about the order of step six and seven. So why do you recommend paying off the mortgage when the mortgage rate is like let's say 6.3%, but the market returns your money at 10% and then with compound interest, you know, because your.

[Dave Ramsey]

Math formula is very nice.

[Caller]

Okay.

[Dave Ramsey]

You left out risk.

[Caller]

Okay.

[Dave Ramsey]

And you left out the fact that you're Psychologically, relationally and spiritually carrying around debt around your shoulders and it affects your health, your relationships, your career choices and everything else. And so what we have found is, is that the people that build wealth the fastest are the ones with a paid off house, okay? Because they're free, okay. And nobody making them do anything. And so suddenly they start making better choices instead of trying to maximize their wealth. Building off the back of a mortgage spread, you left off risk. 100% of the foreclosures occur on a home with a mortgage. We did research.

[George Kamel]

It was easy to do that research.

[Dave Ramsey]

Yeah.

[George Kamel]

Didn't take a big research team fairly, fairly quick.

[Dave Ramsey]

But George, it's, you know, it took me a while, Christiana, to get to where as a math nerd, I understood that the math formula that you're using and I back then was using the same math formula. I couldn't figure out what was wrong with it. And I finally figured out that the more debt you carry, the more risk you carry. And the more risk you carry, you have to mathematically adjust for risk if you're going to use a sophisticated mathematical formula on something. And so I figured out that my math formula and Christiana, your math formula that you're using now is the same one leaves out risk. And when you math adjust for risk, what you perceive to be a spread that you're making is neutralized.

[George Kamel]

Yeah, well, what we find is someone loses a job tomorrow, there's risk there. Now you still got to make that mortgage payment. And so it just opens you up. And on top of that, it's not apples to apples when you look at a mortgage payment with 6% versus what you could make in the market. And by the way, if it's outside of retirement, you're paying taxes on that versus the mortgage is a fixed savings plan right there. You know, you're paying down that interest.

[Dave Ramsey]

Stress related health problems are the number one killer in America. Hypertension, heart attack, so on. It's the number one killer. And, and they've gone up as the debt load in America has gone up. And so the statistics keep getting worse. And so people say, well, nutrition's worse and there's more obesity. Obesity, very true. But also there's more stress. And it's just strange, you know, when we say financial peace, two words that don't go together like airline service. What would it feel like to have your house paid off?

[George Kamel]

Goes beyond the math. It's hard to quantify on paper, but no one regrets it. Nobody goes, man, I wish had a mortgage again that Was fun. I'll do that to make a spread. Hey, guys, George Camel here. Do you ever feel like insurance companies only care about your money and not what you actually need? Well, there's a better way. When you go to Ramsey's Insurance Resource Hub, you'll start feeling confident that you're getting the right coverage that's truly best for you. You'll find helpful info on everything from life insurance, health insurance, identity theft protection, and more. And when you're ready to get the coverage you need, you can connect with a Ramsey trusted insurance pro who will only get you what you need at the best price. Go to ramseysolutions.com insurance ramseysolutions.com insurance insurance.

[Dave Ramsey]

Kyle and Anne Marie are on the debt free stage in the lobby of Ramsey Solutions. Hey, guys, what's up? Hey. There you go. Good to have y'. All. Welcome. Where do y' all live?

[Caller]

Macon, Georgia.

[Dave Ramsey]

Georgia. All right. Just down the road. Well, welcome to Nashville. And how much debt have you two paid off?

[Caller]

About a hundred and forty thousand dollars.

[Dave Ramsey]

Way to go, guys. And how long did that take?

[Caller]

18 months.

[Dave Ramsey]

Whoa, quick. And the range of income during that year and a half?

[Caller]

About 150 to 160.

[Dave Ramsey]

Cool. What do y' all do for a living?

[Caller]

So I'm a software developer for a.

Local credit union and I'm a pre K teacher.

[Dave Ramsey]

Awesome. Very cool. What kind of debt was this? $140,000, man.

[Caller]

A little bit of everything. We had two cars, we had a HELOC, some credit card student loan debt. Student loans.

[Dave Ramsey]

What was the most of it?

[Caller]

Student loans?

[Dave Ramsey]

Yeah. How much of the 140 was student loans? About 90. Okay. How old are you two?

[Caller]

36 and 35.

[Dave Ramsey]

So the student loans been around a while?

[Caller]

Mine have been around for about three years. Hers maybe a little longer.

Yeah, mine about 10.

[Dave Ramsey]

Okay. All right. Yeah, they've been around a while. How long have y' all been married?

[Caller]

Four years.

[Dave Ramsey]

Okay. Okay. So you brought them into the marriage then? Yes, we did. Now I'm getting a picture. And then 18 months. Yeah. Out of four years. So after you've been married a little while, you look up and went, something's got to give.

[Caller]

Yeah, we. We just kind of got to the end of a month and realized, where's it all at? Like, we have all this money and we don't know where it's at.

We have good paying jobs. Why do we, why are we not building our savings account? It doesn't make any sense.

[Dave Ramsey]

Why are we broke?

[George Kamel]

It just comes in and goes out. Comes in goes out. This is not a fun life.

[Caller]

Yeah.

[Dave Ramsey]

Then how'd you get connected to Ramsey?

[Caller]

So I just started looking up, just different, you know, financial. What's the best way to, you know, help pay some stuff off? And Ramsey came up, and I just got plugged in immediately and got every dollar set up and just started going at it. And we sat down. It took us about three. Three months to get the budget really intact.

[Dave Ramsey]

It takes it about three. That's about right.

[Caller]

As soon as we did, we. We were just rolling, rolling, rolling.

[George Kamel]

What'd you figure out? Once you what. Once you got that budget dialed in, where was the problem?

[Caller]

So the. I mean, it was definitely just the amount of payments that we had in every different category. I mean, we had, what, 1800, $2,000 in payments of just stuff.

[George Kamel]

We needed a strategy.

[Caller]

And definitely eating out too.

Yeah, it was.

Was like, we don't need to be going out this much. We can just eat at home and parties with parents and stuff. And going out to eat with family was really big for me. And we just had to tell them, hey, let's just do it at the house and have a potluck just until we're done with this journey. And they supported us in it, so.

[Dave Ramsey]

It was definitely worth it. Very good. Very cool. So, I mean, you guys leaned in hard.

[George Kamel]

Did you sell something?

[Dave Ramsey]

This is crazy. Crazy.

[Caller]

So, yeah. So July 23rd. No, 24.

[Dave Ramsey]

We.

[Caller]

No, it was 23. July 23rd. We bought a van and put it on payments because we're like, we can afford this. It's payments. It's not a big deal. And then in October, when we finally started sticking in, we were like, man, this is crazy. You know, we actually need to figure something out. And so actually, July of 24. So one year later. Exactly. We ended up selling the van for break even.

[Dave Ramsey]

Oh, wow.

[Caller]

And we actually lost about 15,000 in that, which we called our stupid tax.

[Dave Ramsey]

Ow. Yeah.

[Caller]

Because that's what the insurance paid out before we bought the van. And we should have just bought a car in cash, but we weren't that deep in with y' all yet.

[Dave Ramsey]

Gotcha, Gotcha.

[George Kamel]

See why? This will be a great down payment. We can get a nice car. Oh, my goodness. That's the American way.

[Dave Ramsey]

Yeah.

[Caller]

Yeah.

[Dave Ramsey]

Wow. Well, good for you guys. What do you tell people the key to getting out of debt? Paying off 140 grand in 18 months, making 150.

[Caller]

Definitely being on the same page.

[Dave Ramsey]

Yes.

[Caller]

Being on the same page with each other and making sure that that budget is key above all.

[Dave Ramsey]

Else. What was the biggest budget fight?

[Caller]

Like I said, wanting to give presents. You presents and going out to eat with family.

[Dave Ramsey]

And so you're on my team. You're the spender. Yeah. Okay.

[Caller]

I'm definitely the nerd.

[Dave Ramsey]

Okay, well, software engineer, of course. What am I thinking? Yeah, no question, man. Amazing, amazing, amazing. Well done, you guys. So. Wow. What do you tell people the key to getting out of debt is then?

[Caller]

I mean, just sticking to the budget.

[Dave Ramsey]

The budget. The budget and being on the same team. That's what I just.

[Caller]

We don't. We don't live out of the bank account. We live out of the budget. So even if there's $2,000 in the bank account, we don't have $2,000. We have whatever's left on that line item.

And that's what we've explained to people. We're like, that budget keeps you on track. So you're not looking. Looking at what you have in that account at all. You're looking at, this is what I'm allowed to spend. This is what I'm free to spend.

[Dave Ramsey]

That I chose that I was going to spend. I'm the boss of me.

[Caller]

Yes. And I'm the boss of that money. And it doesn't need to direct me.

[Dave Ramsey]

Amazon prime is not my boss.

[Caller]

Oh, yes.

[Dave Ramsey]

Wow.

[George Kamel]

What's next for you guys? You're in your mid-30s, no debt.

[Caller]

So we actually. We just listed our house this weekend.

[Dave Ramsey]

Whoa. And.

[Caller]

And we actually are gonna be selling it and moving up because we have a child on the way, which is number three. And so we're just trying to move up into our next house. And after that, it's just figuring out where we want to go on vacation. We want to go relax a little bit too.

[Dave Ramsey]

Yeah.

[George Kamel]

That's a good new problem to have. Where are we gonna go on vacation? How are we gonna pay off this debt?

[Dave Ramsey]

Yeah. I'm really proud of you guys. Way to go. Very good work. Very good work. So who was bragging on you? Who was cheering you on?

[Caller]

So both of our parents were very, very helpful in the entire process and understanding of it all. There were times where we had to tell them no to going out and stuff, but they were very understanding and helpful in the entire thing. And they are here.

My handyman dad. It was like, oh, we can pay you and grandchildren kisses if you'll do this for us versus us having to pay somebody. That worked out very well.

[Dave Ramsey]

I have not been bribed with that yet. My. I hope my kids are not listening now. So that's Good, though. I love it. Well, congratulations, you guys. Very, very, very well done. Thank you. Were there people telling you you were weird?

[Caller]

Well, everyone at his job, of course.

Oh, yeah. So. Because I work in a bank, I work at the credit union. But I mean, yeah, there's. I mean, there's always talk going around of, oh, we have this new credit card offering. And I'm just like, I'm good.

[Dave Ramsey]

I'm all right. I think I'm set on that. Yeah. Had enough of that. Pretty sure we're done with those things. Yeah. Well, congratulations, you guys. Very, very well done. And. Yeah. Onward and upward. The third baby on the way. The house goes on the market. Here we go. Game on. How's it feel to be completely free? $140,000 off your back.

[Caller]

It's a blessing.

Yeah, it is. It was all God guiding us the entire way. But it is. It is such a freeing feeling.

[Dave Ramsey]

For sure.

[Caller]

Yes.

[Dave Ramsey]

What was the hardest thing about the whole process?

[Caller]

I mean, for me, it was. It was just really. Just making sure that, you know, every. Every time we sat down to budget, that we were on the same page. That was really the biggest one towards.

The end, actually, I was the one that was like, come on, let's just cut those last subscriptions just for a month. He hates ads. And I was like, dude, we gotta let this go.

[Dave Ramsey]

We can do it for.

[Caller]

For that last month and then celebrate.

So we watch ads for a few months.

[Dave Ramsey]

Brutal to think the cars, first world problems. We watched ads like when we were kids.

[George Kamel]

Yeah, you'll tell your kids one day. These are the sacrifices we made.

[Dave Ramsey]

We watched ads for three months. Yeah. That's great. Very cool. Well, congratulations, you guys. We're very proud of you. Bring the kiddos with you. We did bring them up here and introduce them ages and names.

[Caller]

So Daniel is three. 24 hours ago, he decided to jump off of a playground and fracture his shin.

[Dave Ramsey]

So why not go Daniel? Yeah.

[Caller]

He was being super brave.

[Dave Ramsey]

All right. Sweet Bella.

[Caller]

Fun.

[Dave Ramsey]

Yeah. All right, you got guys, Kyle and Anne Marie. Those kids don't even know what their parents have done to change their whole family tree. 140,000 paid off in 18 months, making 150 to 160. Count it down. Let's hear a debt free scream.

[Caller]

Three, two, one.

[Dave Ramsey]

We're debt free. Yeah. That's how it done.

[George Kamel]

Daniel yelled from his little stroller down there because he couldn't get up because of his bum leg. But he was yelling, oh, good time to be debt free when you have an emergency like that. And you just cash flow.

[Dave Ramsey]

It changes an emergency into an inconvenience. Wow. Pretty cool. Hey, that's a powerful couple right there. What they pulled off in that short period of time and right after getting married, too. Yeah, I mean, they sat down, pushed through all the relationships stuff, made it all happen. Very cool. Very cool. Proud of you guys. Sam, our scripture of the day, Proverbs 22:1. A good name is to be chosen rather than great riches and favor is better than silver or gold. Philip Fisher said, the stock market is filled with individuals who know the price of everything and the value of nothing. Ryan is in Minneapolis. Hey, Ryan, how are you?

[Caller]

I'm good. How are you?

[Dave Ramsey]

Better than I deserve. What's up?

[Caller]

Thank you for taking my call. Sure. My wife and I are currently in baby step three and we'll be finished with that by the end of the year. We receive an annual bonus in March. It'll be roughly $15,000. Take home. Would it be better for us to take that 15 to fully fund our Roth IRA or to spread our contributions out throughout the year and use the bon between steps 4, 5 and 6?

[Dave Ramsey]

It doesn't matter much. Either one will be fine. The difference mathematically is what you might earn if you do the 15 all in a lump sum in March. What would you have earned in March versus 1/12 of the month all the way around? And so, you know, like, say the average might be what you would earn on 8 or 10,000 of that 15. So it might be $1,000 difference. It might be $800 difference on a 10 or 12% year.

[George Kamel]

Unless we had a crystal ball. We won't know for sure what the math is on that. But in general, the sooner you get money into the market, the better off you're going to be long term.

[Dave Ramsey]

Right, but it's not, I mean, the difference, it's not like you're going to have millions of dollars more because you did 15 lump sum versus 151 12th of the time all the way around the horn.

[Caller]

Right, right.

[Dave Ramsey]

But. But basically, for instance, in my case, okay, I fully fund my 401k for the whole year in January.

[Caller]

Okay.

[Dave Ramsey]

I dump the whole thing in there, okay? Because I can, I own the company and I can just bonus myself whatever I need to and make sure I got enough to do that, right? So I just load the stinking thing up and then I've got that, I don't know, let's call it 20,000 bucks or 30,000 bucks or whatever it is. It's working the entire year, year, rather than 1/12 working the entire year, 212 working part of the year, 3/12 working part of the year, 412 working part of the year, and so on. You follow me? So the difference is what I would make on 30 grand, 27 grand, 28 grand, 24 grand, 23 grand, 22 and so on all the way around the horn. And so it's. George is right, a lump sum up on the front end is going to average more, more than, than doing it monthly. The second thing to enter into the conversation, because it's a good question, is you want to be sure if the steady monthly thing keeps you doing it because you're on autopilot versus jumping on and off the wagon with lump sums. And you don't, you're not as predictable with it, sustainable with it that way you'd be better off sticking with the one that keeps you doing it. And so I set up stuff, I set up stuff early in my life once I started understanding these principles to trick myself into having discipline, like automatic 401ks or automatic draft on my checking account for Roth IRAs or those kinds of things back in the old days. So I automatically had debt. I went so far as I. In the old days, when I started this stuff, there was no Internet, of course, and so there was no auto. There was very little auto draft on utilities and that kind of stuff. You used to have to write a check and send your electric bill through the mail. Okay. And as soon as they set it up where they would take auto draft, I put all my utilities on auto draft so that I never missed a discount. And that's been, God, that's 25 or 30 years I've been doing that. So anything I can do to have autopilot, Autopilot, Automatic discipline.

[George Kamel]

Yeah, I like that mentality because if you're investing 15% of your income forever, you've got to learn to live on 15% less than you would have. And so it's sort of like that money was never there. And that's a good way to live because it keeps you in check. So I think that long term discipline is key. But for this year, if you just wanted to fund them and be done with them and move on.

[Dave Ramsey]

That's correct. For 10 years you've always gotten a bonus in March of 15 grand. And you, you want to just label that, that's going to go towards our retirement and we're going to do less through the rest of the year. Fine. I don't know, you know, but whatever you do, trick yourself into being consistent. And when given the opportunity, a lump sum early in the year will outperform a steady monthly investment because it's been in there longer. There's a fancy name for that. Longer.

[George Kamel]

Dollar cost averaging.

[Dave Ramsey]

Well, that's what you're not doing is dollar cost averaging when you put it all in there. Yeah, you're missing out on that. RJ is with us in Fort Worth. Hey, rj, how are you?

[Caller]

Hey, Dave, how's it going?

[Dave Ramsey]

Better than I deserve. How can we help?

[Caller]

Hey, so my question is, fiance. I'm in baby step two and I have like 12,000 in debt. TDL school is 3,000. I don't know if I should go.

[Dave Ramsey]

Ahead and like, what school back into what school?

[Caller]

CDL school to get your CD at?

[George Kamel]

Yeah, just three grand to do that video.

[Caller]

So I currently have my CDL B but in order, in order to increase my income, I need a CDL A. So like, should I go into more debt and like 3,000 more to go, like to make more money, or should I wait until I pay off my debt completely and then once I'm done, baby step two, should I go ahead and like, you know, cash flow at three grand?

[Dave Ramsey]

Where are you working?

[Caller]

It's like a sweet almost. I'm currently a super driver suiting corporation, America.

[Dave Ramsey]

So you're not driving now?

[Caller]

Yeah, yeah, I'm currently using my CDLB. I'm currently making money with my CDLB.

[George Kamel]

Okay, what are you making doing that?

[Caller]

About 54, 54 a year.

[Dave Ramsey]

And what would you, what would you stay with the same company and. Or change jobs?

[Caller]

No, I definitely, I definitely change jobs. I go like to a higher paying company. I'll probably make at least 70,000. Maybe like 80 to 100. I mean 70 to 100,000. There's no limit.

[George Kamel]

How quickly could you save up three grand make? And what you make now?

[Caller]

Maybe like three or four months maybe if I really put more into it.

[Dave Ramsey]

Yeah. And what I do is work six extra jobs and sell so much stuff the kids think they're next and scrape up three grand in cash about. In about a month. But no, I'm not going to borrow money to go do it. Dude, the secret to getting out of debt is to stop borrowing. That's the first step. You got to quit looking to debt to be your answer, to be your savior. Every time you want to go do something, you got to say, that's not an option anymore. I'm going to take debt off the table. It's not an option now. How am I going to do this. Well, it's a good thing to do. I mean, if you can spend three grand and up your income 25 grand, I think you ought to do that. That sounds pretty good, but. And so what that means is I'm going to be working my tail end off, man. I'm going to be working like all the time. And go get me three grand because I mean, that's where money comes from. His work. And so go get you some. That's what I would do. And I'd be busting it, man. And at the workplace, I'd be asking for overtime. I'd be asking workplace to pay for it and let them, you know, maybe they keep you on at 70 grand with a CDL. Right. And so yeah, there's nothing wrong with that, but that's. And there is a shortage of drivers right now. So that's not a bad thing at all to go get that, that, you know, get that license to be able to move some stuff around. Yeah, I'm definitely gonna go get the money, but no, RJ, I'm not gonna. I've never told someone in 30 years to go into debt on this show.

[George Kamel]

Guess we're not starting today.

[Dave Ramsey]

Yeah, and. But if I were in your shoes, I'd be wanting that three grand. I'd be wanting it really, really bad.

[George Kamel]

Yeah, some good ROI on that.

[Dave Ramsey]

I'd go get some. I mean, what do we got? We got can sell. What about that motorcycle, that four wheeler that's out in the backyard? Oh, why don't. Yeah, well, go sell it. Get your three grand. You're getting ready to borrow money. You know, you're sitting on some junk back there somewhere probably that'll pay this thing. So just figure out what you can do. And once I took debt off the table, George, I started seeing all kinds of creative options.

[George Kamel]

Your imagination runs wild when it doesn't involve a lender.

[Dave Ramsey]

Yeah, when I can get stay. You know, once I do anything to stay away from a bank or I can't do the thing. Well, I want to do the thing. So I'm going to go find a way, but it's not going to be with a bank.

[George Kamel]

Yeah, I just crunched some numbers here. I'm like if you can go make 25 an hour driving for Amazon Flex, just drive packages after work. That's 120 hours. Okay, now I know what it's going to take to go get that license. 120 hours of extra side hustling so.

[Dave Ramsey]

That just five hours a day for 20, 20 days.

[George Kamel]

There you go.

[Dave Ramsey]

Ding.

[George Kamel]

So there's the math.

[Dave Ramsey]

I might be tired. Oh, well, you sounds like a young guy I know. Not him.

[George Kamel]

He's got energy.

[Dave Ramsey]

He wasn't a whiner. But, I mean, I've talked to a few people that whine. It's okay.

[George Kamel]

You might miss the next series on Netflix.

[Dave Ramsey]

You're not gonna die from hard work. Right before you die from hard work, you pass out. It's okay.

[George Kamel]

That's how the Lord intended it.

[Dave Ramsey]

That puts us hour on the ran 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.