Your Overspending Will Eventually Catch Up With You

Summary

Podcast Summary: The Ramsey Show – "Your Overspending Will Eventually Catch Up With You"

Release Date: March 26, 2025

Overview

In the episode titled "Your Overspending Will Eventually Catch Up With You," hosted by Rachel Cruz and co-produced by Jade Warshaw, The Ramsey Show delves into various listeners' financial dilemmas related to overspending, debt management, and wealth building. The episode features a series of caller interactions where Dave Ramsey and his team offer personalized advice aimed at empowering individuals to regain control of their finances. This summary encapsulates the key discussions, insights, and conclusions drawn from each caller's situation.

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1. Jason from San Jose, California (00:42 - 08:08)

Situation: Jason and his wife earn a combined household income of approximately $320,000. They own two mortgages—one on their primary residence with a remaining balance of $220,000 and a rental property breaking even with $300,000 left. Despite substantial savings in money market funds and retirement accounts, Jason's wife desires a separate six-month emergency fund in a readily accessible savings account tied to their checking. This difference in financial management approaches has led to tension and confusion about their current Baby Steps plan.

Advice: Dave Ramsey suggests establishing a dedicated emergency fund account, clearly labeled and separate from other savings and investments. He emphasizes that this separation provides peace of mind and organizational clarity. Ramsey advises moving a portion of the existing $100,000 in the money market into a new, distinct emergency fund to satisfy his wife's need for accessibility without disrupting their investment strategy.

Notable Quotes:

• Dave Ramsey (03:52): "You have the money. So I would take that part of that hundred thousand that you have in cash or somewhere else and get a six-month emergency fund in a new account and label it emergency fund."
• Rachel Cruz (07:17): "We feel really blessed because we don't argue about this. We just never argue about money."

Conclusion: By restructuring their emergency funds into separate accounts, Jason and his wife can alleviate tension and maintain their momentum through the Baby Steps, ensuring sustained progress towards financial stability and wealth building.

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2. Brandon from Columbus, Ohio (10:43 - 18:10)

Situation: Brandon, a union electrician earning approximately $60,000 annually, struggles to build wealth despite managing a household budget that suggests a residual of $1,200 monthly. With significant debt from vehicle loans ($8,000 on a Jeep and $22,000 on a van) and three boys aged 10, 6, and almost 2, Brandon finds it challenging to save due to fluctuating expenses and obligations.

Advice: Jade Warshaw and Dave Ramsey emphasize the importance of strict budgeting and debt elimination. They recommend selling the high-cost van to reduce monthly payments and free up cash flow. Additionally, they suggest revisiting the budget to identify and cut unnecessary expenses, potentially incorporating a side hustle to increase income. The hosts also introduce Brandon to Financial Peace University, offering a structured program to guide him through the Baby Steps.

Notable Quotes:

• Jade Warshaw (14:57): "I think the first thing here is the budget. You need to redo the budget and say, okay, realistically we need a kids line item."
• Dave Ramsey (17:56): "When you're ready to buy, make sure you work with a mortgage partner… Churchill Mortgage is Ramsey trusted to help you make the move from renting to home ownership wisely."

Conclusion: Brandon is encouraged to focus on debt reduction by selling his van and optimizing his budget. Engaging in Financial Peace University can provide the necessary tools and support to navigate his financial challenges and move forward with building wealth.

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3. Emily from Pensacola (22:06 - 35:16)

Situation: Emily and her husband have been through Financial Peace University over a decade ago but have returned to Baby Step Two, dealing with residual student loans and a mortgage. Despite no consumer debt and an early plan to pay off their mortgage within 10 to 15 years, Emily is uncertain about managing credit cards to maintain a good credit score for future refinancing purposes.

Advice: Dave Ramsey advises closing credit card accounts to prevent any negative impact on their credit score. He explains that while closing accounts might initially dip their score, maintaining their mortgage and consistent payments will stabilize it over time. Jade Warshaw concurs, highlighting that distinguishing the emergency fund from regular savings can provide clarity and reduce financial stress.

Notable Quotes:

• Dave Ramsey (25:04): "If I were you, I'd cancel them sooner than later so that your score has the ability to do what it's going to do… once everything is back then and stabilized."
• Emily (22:09): "I have about $140,000 in debt right now, and my wages are being garnished already."

Conclusion: By closing dormant credit card accounts and focusing on consistent mortgage payments, Emily and her husband can maintain a healthy credit score while advancing through the Baby Steps towards financial independence.

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4. George from Los Angeles, Louisiana (33:16 - 36:33)

Situation: George faces $140,000 in debt, including three personal loans and a car loan, with wage garnishments affecting his household income of $75,000. Despite attempts to increase income through multiple jobs, George contemplates either selling his home or filing for bankruptcy to manage his overwhelming debt.

Advice: Dave Ramsey and Jade Warshaw recommend selling the car to eliminate high monthly payments and free up $500 monthly. They also urge George to reassess his budget, identify non-essential expenses, and explore income augmentation strategies. The hosts emphasize that maintaining control over his financial situation is crucial before considering more drastic measures like bankruptcy or selling the home.

Notable Quotes:

• Dave Ramsey (45:17): "When you're shagged down this way, you have to make some tough choices… selling that van can take the pressure off."
• Jade Warshaw (51:03): "And so you guys got this. This is the Ramsey Show."

Conclusion: George is advised to eliminate unnecessary expenses by selling his car, thereby reducing his debt burden. This step, combined with a strategic budget overhaul, can help him regain financial stability and avoid filing for bankruptcy.

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5. Will from Miami (37:02 - 44:05)

Situation: Will, a military member, is transitioning out of service and grappling with life insurance decisions. Currently, he pays $31/month for a $500,000 policy through the military and considers rolling it over to a Veterans Group Life Insurance plan for $35/month. At 26 years old with no dependents, Will is uncertain about the necessity of maintaining the policy.

Advice: Dave Ramsey and Jade Warshaw suggest that life insurance is primarily for dependents. Since Will currently has no wife or children relying on his income, they recommend canceling the policy once he transitions out of the military to avoid unnecessary expenses.

Notable Quotes:

• Dave Ramsey (73:07): "I don't think you really need a life insurance policy for that… I probably would just end up canceling it once you get out."
• Jade Warshaw (73:33): "If you don't have to pay it now, forget the rollover. I would get out of it now if I could."

Conclusion: Given his current status with no dependents, Will is advised to terminate his life insurance policy, thereby conserving funds for other financial priorities until such time that dependents may necessitate coverage.

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6. Anna from Pittsburgh (75:18 - 85:40)

Situation: Anna has been married for 19 years, owns a home with a mortgage of $243,000, and faces significant credit card debt totaling $209,000. Her husband controls the finances, leaving her without access to joint accounts or financial information. With mental health concerns and an autistic son, Anna feels trapped in a financially abusive marriage, uncertain about protecting herself and her child.

Advice: Dave Ramsey and Jade Warshaw address Anna's financial abuse and lack of transparency by recommending a multifaceted approach:

1. Financial Separation: Urge Anna to gain control over her finances by securing access to her income and savings.
2. Debt Management: Focus on paying off high-interest debts, starting with the car loan to free up cash flow.
3. Emotional Support: Encourage seeking assistance from trusted friends, family, or professionals to navigate the abusive dynamics.
4. Legal Counsel: Advise considering legal avenues to protect herself and her child, potentially exploring options for financial independence.

Notable Quotes:

• Dave Ramsey (82:52): "You're not able to do anything here. This is a more serious situation that creates more ultimatums."
• Jade Warshaw (84:01): "There are no options for you. But I can guarantee you this, it is not going to be a comfortable option."

Conclusion: Anna is urged to take decisive steps towards financial independence and seek emotional and legal support to address the abusive financial environment. By gaining control over her finances and reducing debts, she can work towards a safer and more stable future for herself and her son.

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Final Thoughts

Throughout the episode, The Ramsey Show underscores the importance of structured budgeting, debt elimination, and financial transparency in overcoming overspending and building sustainable wealth. The hosts consistently advocate for Baby Steps as a roadmap to financial peace, emphasizing personalized strategies tailored to each caller's unique circumstances. Notable advice pillars include:

• Separate Emergency Funds: Clearly distinguished from other savings to enhance security and reduce financial tension.
• Debt Snowball Method: Prioritizing debt repayment to quickly eliminate high-interest obligations.
• Financial Transparency and Control: Ensuring all parties have access to and understanding of household finances to prevent abuse and mismanagement.
• Strategic Life Insurance Use: Aligning life insurance policies with dependency needs to avoid unnecessary expenses.

Listeners are encouraged to engage with their financial challenges proactively, leveraging the guidance provided by Dave Ramsey and his team to navigate their paths toward financial stability and wealth building.

Transcript

[Jade Warshaw]

Hey, guys, it's James Childs, producer of the Ramsey Show. This week, Dave and the personalities are living it up on the Ramsey Cruise. So we've put together a compilation of some of our favorite calls and segments from the last year. Regular shows are back next week.

[Rachel Cruz]

Hope you enjoy.

[Jade Warshaw]

Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love and create actual amazing relationships. I'm Jade Warshaw. I'm joined today by best selling author Rachel Cruz. Thank you for being here with me today, Rachel.

[Dave Ramsey]

So great, Jay, Good show.

[Jade Warshaw]

It sure is. All hour we're going to be taking calls about your life and your money. So give us a call. The number is 3882-55-225. We'll take your call and we will give you our best shot at advice. I think we do a pretty good job, but I guess at the end of the day, it's up to you. So, so let's go straight to the phone lines where we've got Jason from San Jose, California. What's going on, Jason?

[Rachel Cruz]

All right, thanks for taking my call. The problem that we're having is my wife and I can't decide if we're in baby steps, three, four, five or six. And we seem to be moving in and out of those baby steps.

[Jade Warshaw]

Okay, tell me more.

[Rachel Cruz]

Well, we make about $320,000 as our household income. We've got two mortgages, one on our primary home with about $220,000 left to pay on it. Then we have a rental property that we break even on every month and we've got about 300,000 left on that we both save for our retirement and we max that out every year to get the matching contributions. I have ESPP along with other investments that I place. Then we have college funds for our kids. And the issue is I manage so my wife manage all the month to month, you know, daily checking operations. And she wants to have the six month savings in, you know, in a savings account tied to the checking account. And I keep explaining to her and showing her that, hey, we've got all this money elsewhere, you know, money market funds and, you know, stocks and what's.

[Jade Warshaw]

In the money market?

[Rachel Cruz]

The money market has about 100,000 in there.

[Jade Warshaw]

Okay. Would you say that that's more than six months of expenses?

[Rachel Cruz]

Oh, yeah, definitely. Definitely.

[Jade Warshaw]

And so you're saying she wants money on top of that. It sounds like she just wants a little slush fund so that when, if you go over budget, it's all Good, right?

[Rachel Cruz]

No, because we do use the money app and that's working out well, she just wants to have access to it.

[Dave Ramsey]

Yeah, well, I don't know. Yeah, I don't know if it's much access. I just wonder, Jason, because in your head, yeah, there's money there, but it's kind of attributed to whatever may be needed. And I think for her, there could be a level of safety of saying, hey, we're going to open up a, you know, a new account in this money market account and we're labeling it the emergency fund and we're going to have six months in there and that's it. And like that, that's what it's titled, that's what it's labeled, and that's what it is and nothing else. Because when you start to say, cause I could even feel that, like, yeah, there's money here or there and there's some stocks and it's like, okay, but how can I get to it if we really need it? I think it's more of a security thing for her. And I think. And I think that level of organization too is really healthy and good. And so what you could do, Jason, seriously. And this is what we tell people for your emergency fund, it's its own account. It's over here. You don't touch it unless you need it. But it's designated specifically for that. And would that help her, do you think? If you just say, yeah, we're going to take some of this hundred thousand, have another account, we're not touching it, but it's here if we need it.

[Rachel Cruz]

I think it would. But the question is, you know, the follow up question to that is, do we stop the baby steps? 4 or 5 and 6?

[Dave Ramsey]

Because you have 100,000, you have the money in that money market account. 100,000 could be it.

[Rachel Cruz]

Oh, I see.

[Jade Warshaw]

Is it just because it's the same place where like all your, like where all of your retirement is and like where all your investing is. Is that why she's not viewing it as an emergency fund?

[Rachel Cruz]

That's right. Yeah. And you know, we've had issues come up. Like last year in the rental, we had a flood that we had to deal with and we went into, you know, we went into one of the accounts, we pulled the money out, we paid cash, There was no issue.

[Jade Warshaw]

Yeah. Because you know, we've got accessible.

[Dave Ramsey]

Yeah. Then did you go back and replenish that? Because in her head she's like, oh my gosh, we've used that. Is it here? I Don't know. I could see what she's saying because that's how I am. Like, we have a high yield savings account. Jason, my husband and I. And so we'll put extra savings every month in this fund. But underneath it, like when I go into ally.com, we have one line that says like savings. We have one line that says emergency fund with that amount of money. And I need those separate. Like, I need to know there's this, there's this here, and we don't touch that. But everything else is just extra savings on top of what we need. You know, if something happens at a rental, if we need, if we're going on a trip or something, like, here's money we spent, here's money we just don't touch. And it's here just in case crap hits the fan. And that fan feels good to me. With the distinction. Like, even. Jason, this may sound crazy, even to the point that I'm like, if we're talking about money, I'm like, well, babe, how much is in the, is in the high yield? He'll give me the number. And I'm always like, does that count?

[Jade Warshaw]

Emergency fund?

[Dave Ramsey]

Does that count? The emergency fund? Are you adding those together? And he's like, no, I never add them together. For your sanity. And I'm like, thank you. So.

[Rachel Cruz]

So you don't think we should slow down on, on paying off the mortgage early?

[Jade Warshaw]

No, you have, you have the money.

[Dave Ramsey]

You have the money. So I would take that. What? That I would take part of that hundred thousand that you have in cash or somewhere else. I don't care where you get it. And get a six month emergency fund in a new account and labeled emergency fund. And I think that will ease her, her tension. I really do. I think that would be, that's what I would do. That's what I would want personally.

[Jade Warshaw]

I, I just want to make sure we're covering this because the screen says we can't save up an emergency fund. And is there something we're missing here? Is it just as simple as relabeling this money?

[Rachel Cruz]

Yeah, it is. It's because she wants, you know, in the regular checking savings account that are, you know, in the day to day operations. She wants to see the savings account six months. And she is wrong about do that. She's saying if we want to do that, then we got to stop, you know, we got to stop on the, you know, the extra mortgage payments we're making. We got to stop on the 401k payment. We gotta you know, we've got to stop those other baby steps to rebuild that, that six month savings.

[Jade Warshaw]

Well, I think you're, I think you buy, I think you guys both have a place where you need to concede a little bit because to her what she wants is I wouldn't keep the emergency fund with the normal checking. And you know, like we have, we have Ally where we do all of our savings and then we have like Chase over here that has, you know, other things. And so I wouldn't keep it with your normal day to day funds. But to your point, I mean we recommend all the time you can keep it in a money market or you can keep it in a high yield savings account. So whatever feels right. But to Rachel's point, you do have that money. And so I think that you guys both have to give a little and take a little. You have to be willing to pull it out of a money market because for whatever reason that's making her feel some type of way. And then she's gotta be fine with you putting it in someplace else that has a nice rate of return. You know, Ally is a great one.

[Dave Ramsey]

We used to say back when cash was like the prevalent thing of the emergency fund and it would be like, you know, don't put it in the sock drawer where the pizza guy can get it.

[Jade Warshaw]

That's right.

[Dave Ramsey]

Like kind of that joke that like it can't be so accessible that you just go and you can just get it.

[Jade Warshaw]

You know, you want to forget about it.

[Dave Ramsey]

Yes. You want it.

[Rachel Cruz]

We feel really blessed because we don't argue about this. This is just like you never argue about money. We don't have to. And it's just like what's the best approach, you know?

[Dave Ramsey]

Yes. Yep. I think for her to know she can get access to it guys need it for an emergency, number one. And number two, for her just peace of mind that there's extra money over here, it's for this. It's not going to get tied up in some stock deal that you're doing Jason here, that right. Like it's like there's a level of like that's for the emergency fund and we don't touch it. And I think.

[Rachel Cruz]

Okay, now one, one quick question. Now. Do you pay off your primary first or your rental?

[Jade Warshaw]

Primary, primary.

[Rachel Cruz]

Okay.

[Jade Warshaw]

I want the place where you guys lay your head at night to be completely debt free and peaceful.

[Rachel Cruz]

Perfect.

[Jade Warshaw]

Awesome.

[Rachel Cruz]

Thank you so much.

[Jade Warshaw]

Thank you for the call. That's a really, you know, that's an interesting thing, Rachel, because I do Think that when it comes to savings, you know, you do have to keep it a little bit. It's got to be enough out of reach to where you don't quote, accidentally spend it. But at the same time, it's got to be liquid enough to where if the water heater goes out and you can't cash flow it, you can get to it. So you don't want to invest it.

[Dave Ramsey]

And you made a good point earlier that, and I don't think this was her from what he was saying. But you also don't want to have a bunch of money so that you can be lazy with your budgeting and you spend more than you make. But it's okay because we got 10 grand over here. We'll just get it. Yeah, don't, don't let it be a cushion for your everyday expenses. It's a cushion between you and life when the big stuff happens. That's your emergency fund, not to cover lifestyle.

[Jade Warshaw]

That's right. This is the Ramsey Show.

[Rachel Cruz]

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[Dave Ramsey]

Welcome back to the Ramsey Show. We are taking your calls at 888-825-5225. I'm Rachel Cruz hosting with Jade Warshaw and we're gonna go to Brandon in Columbus, Ohio. Hey, Brandon, welcome to the show.

[Rachel Cruz]

Hey, how are you doing today?

[Dave Ramsey]

We're Doing great. How can we help?

[Rachel Cruz]

So the reason I'm calling is I can't seem to build any kind of wealth whatsoever.

[Jade Warshaw]

What's happening? Tell us more.

[Rachel Cruz]

Well, you know, I got, I got three boys and I got a wife that stays at home and I'm the only income, but I think I make okay money. But every time I try to build some wealth, you know, like something happens with the kids or. Yeah, something along that line.

[Jade Warshaw]

Tell us about your income. What are you making every year?

[Rachel Cruz]

Well, I'm a union electrician.

[Jade Warshaw]

Okay.

[Rachel Cruz]

So I make about 15, 28 if I work on Saturdays.

[Jade Warshaw]

Okay.

[Rachel Cruz]

I usually work Saturdays.

[Jade Warshaw]

So every month, if you look at your budget, how much is on that top item?

[Rachel Cruz]

My budgets, it takes about 4, 800 and some change maybe.

[Dave Ramsey]

Okay, is that what you're bringing?

[Rachel Cruz]

4800?

[Dave Ramsey]

Income wise, that's what you're bringing in.

[Rachel Cruz]

Income wise, I'm bringing in maybe about six.

[Jade Warshaw]

Okay, so 6,000. Okay. And then do you guys have debt?

[Rachel Cruz]

Well, you know, I got, I got my Jeep and my old lady has her, her van.

[Dave Ramsey]

Is that on payments?

[Rachel Cruz]

It, I wish it wasn't, but it is.

[Dave Ramsey]

Yeah. How much, how much do you guys owe on, on yours?

[Rachel Cruz]

Well, my Jeep, I got maybe maybe 8,8000 left and on her van we just had to get, so it's around 22.

[Jade Warshaw]

Okay, how much did you just got it?

[Rachel Cruz]

Yeah, we just got it maybe about a week ago.

[Dave Ramsey]

How much are your car payments? In the, on those, both of those?

[Rachel Cruz]

Well, that's where it's eating me. Yeah, on my Jeep, on my Jeep I'm paying about four. On her van I'm paying around six.

[Jade Warshaw]

Oh, I bet you, yeah, it's a thousand dollars. Okay, what else? So you got the Jeep, the van, what else do you have? Are there credit cards? Do you have any other loans?

[Rachel Cruz]

No, I really don't have loans. I mean, I mean we got, you know, groceries and we got, we got rent.

[Jade Warshaw]

Okay, so those, that's fine. Those are fixed expenses on your budget. But do you have any other debt which is, you know, a lump sum of money that you owe?

[Rachel Cruz]

I mean, maybe when I was a younger man. Let's, I'll just keep it easy. I'd probably say maybe about 10 grand. Maybe.

[Dave Ramsey]

What would it be in credit cards?

[Rachel Cruz]

No, it'd probably be a little bit of hospital and maybe miscellaneous. I'm sorry, I'm kind of lost.

[Dave Ramsey]

Brandon, how old are your kids?

[Rachel Cruz]

I got a 10 year old, I got a six year old and I got a one about to be two year old.

[Dave Ramsey]

Okay, perfect.

[Jade Warshaw]

Okay, so here's the thing. I think you're having a hard time building wealth because your biggest wealth building tool is your income. And right now a thousand dollars of your income is going or, and maybe a little bit more is going towards your debt payments every single month. And it sounds like, I'm not sure, but it sounds like maybe you're trying to do a little of this, a little of that, a little of that over here. And the method that we teach you is going to give you focused intensity on one area at a time for the most part. So do you have any money saved?

[Rachel Cruz]

That's the problem. I don't, I can't seem to save a dollar.

[Jade Warshaw]

Okay, so let's go back to the, the, the essentials here. I think the first thing here is the budget. You told me that out of $6,000 a month, it takes 4,800 to run your household. So that means somewhere along the way there's $1,200 left if you're doing your budget correct.

[Rachel Cruz]

Right.

[Jade Warshaw]

But you just said you, you can't find a dollar. So something about that budget isn't adding up. So let's kind of let Rachel and I give you a quick crash course with the budget.

[Dave Ramsey]

Yeah. Because the, the thing is with the budget, Brandon, is it needs to be realistic. So you keep saying, you know, which I get. We Jade has kids, I have little kids. So stuff does come up, you know, when you're a family and there's multiple people you're keeping afloat. So either you need to redo the budget and say, okay, realistically we need a kids line item because st to come up every month that we have to pay school fees like whatever it may be.

[Jade Warshaw]

Sports.

[Dave Ramsey]

Yep. That we're going to put in. And then there also may be, Brandon, a you know, a time that you and your wife sit down and you say, okay, we're going to limit this budget. And just because we feel like, you know, the kids need X, Y and Z, we may tell them no right now because your goal is going to be to get out of debt. And so that budget is really, really key. And tightening up that budget is gonna, is gonna be huge. So that's gonna automatically probably give you some of that breathing room of that twelve hundred dollars that we don't. You know, it kind of just disappears.

[Jade Warshaw]

The next piece of this I would do. Okay, so Rachel's telling you tighten up the budget. Yeah.

[Dave Ramsey]

And you have a lot of car.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

Is that what you're going Next.

[Jade Warshaw]

Yeah. You just bought this car for $22,600 payment a month.

[Dave Ramsey]

Brandon, Sell it. Sell it. Yeah, because. And we always say not to have anything with wheels and motors. That is more than half of your, you guys are right over that. I mean you're making 60. Yeah. And I mean you guys are, you're, you're, you're close to that. You're at 30, I mean, like that. So you're, it's too much. You have too much car. And I think you're feeling that, Brandon, you're feeling that. And so looking to say, okay, what are our options? What can we do that is different? And it's probably going to be selling that van and.

[Jade Warshaw]

Yeah. And that's going to take. So let's put this in the timeline. So the first thing you're doing, what Rachel said, you're getting on your budget. You're getting a realistic budget, you're figuring out what can we cut so that this $1200 is actually a reality. And it's you and your wife agreeing to that because you need that money so you can save up a little bit to get out of this car and get into a car that you can afford. Because no more car, no more car payments. Right. So you need at least $5,6000 to make this thing happen. At least. Right. So we're getting out of this car and then after that it's okay, we freed up $600, we can breathe a little bit. And maybe it's you picking up a side hustle. Your wife, she's got the two year old at home, but there's, you know, at least it's one at home and not the others. And so what can she do to bring in extra income? And from this point on, it really is you guys deciding how quickly you clean up this mess by deciding how much more money comes in. Because the ultimate goal is building wealth. The debt is standing in the way that you clear out the debt and then you get yourself that emergency fund of three to six months saved. Now you're going to feel peace about day to day life. Right? So if an emergency hits you, you're fine. And now you can actually start building wealth. You can start Investing into your 401k if you have it, start investing into a Roth IRA as an option. But we've got to get through baby steps one through three. One through three first.

[Dave Ramsey]

Brandon, have you looked into, you know, other small businesses in your area and what they're paying for electricians? I just wonder, even if you switch out of the union if you could find a better gig that pays more.

[Rachel Cruz]

Well, I mean, I've, I mean, I've done. I did solar for seven years and you know, I have a little LLC with that. But I mean, and realistically, until I hit a journeyman's card, you know, I'm not really. There's really nothing out there that's maybe paying more. I mean, it may be a dollar, it may be $2, but sure. Nothing like jumping up another 10 to $12,000.

[Dave Ramsey]

Okay. Yeah. Yeah. Because I was just curious if, you know, sometimes in the private sector there's, you know, other opportunities. So I just didn't know if you had explored that because. Because I think the goal too, Brandon, is, you know, you guys make 60,000. And yes, there's a level of intensity during baby steps one through three to kind of get you out of this hole. So there will be, you know, extra work here or there, all that. But I think the goal is eventually to be able to live off of your income comfortably and enjoy it. Be able to put some money aside for retirement, you know, do some of these things to enjoy your life. And so if that is not coming to fruition. Yeah. Then that's where a bigger conversation is. And you guys are renting right now. Right. So even home ownership to be in the picture eventually, which I know can probably feels very overwhelming right now to think about, but, but to be able to, to get there. But hey, Brandon, I want you to hold on the line because Christian's going to pick up and I want to gift you guys Financial Peace University, you and your wife. This is our nine lesson course and go through this and, and again, it runs the gamut. Everything from the budget to getting out of debt, all of it. And then you know what? And hold on the line too. And Christian, we'll throw in some of Ken Coleman's stuff. He has a great career, assessments. That would just be interesting, Brandon. And again, being an electrician making 60 grand, that's fabulous work and wonderful. But I think we, I think people do get to a reality of, okay, how do I sustain my life? And if you can ever make more, that's going to help it without completely shifting your lifestyle. So just out of curiosity, maybe dig into some of that too and see if that kind of triggers anything for you. So thanks for the call, Brandon. You guys got this. Just stay on track. This is the Ramsey show. There's a time in your life and in the baby steps for renting, but you don't want to do it forever. Because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget because it always goes up, never down. So when you're ready to buy, make sure you work with a mortgage partner. You can rely on Churchill Mortgage. Churchill is Ramsey trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy a home the Ramsey way, your mortgage payment will be a consistent, manageable part of your monthly budget. Plus, when your home is paid off, that was your largest expense. Now it's extra money in your pocket and an asset towards turning you into a baby steps millionaire. So get started on the American dream of home ownership [e-mail] that's churchillmortgage.com this is a paid advertisement in MLS ID 1591 in MLS Consumer Access Equal Housing Lender, 1749 Mallory Lane, Suite 100, Brentwood, Tennessee, 37027. Welcome back to the Ramsey Show. I am Rachel Cruze hosting today with Jade Warshaw and we are taking your calls at 888-255-225. Up next is Emily in Pensacola. Hey, Emily, welcome to the show.

[Rachel Cruz]

Hi. Thank you so much, y'all, for taking my call. I appreciate it.

[Dave Ramsey]

Absolutely. How can we help?

[Rachel Cruz]

Okay, so my husband and I had gone through financial peace, gosh, over a decade ago, but, you know, life happened and five kids happened and right now we're back on it, but finishing up baby step number two. We have no consumer debt, a little bit of student loans left that we expect to be paid off by the end of this year and then we'll just be left with our mortgage. We are in a 30 year veteran loan, but we plan to pay it off early, within hopefully 10 to 15 years. My question is. So right now we have, my question is kind of regarding our credit score. We have four credit cards right now that are open but frozen. We have not used them in probably about a year. We're kind of, I guess, not sure what to do with those accounts. We're kind of leaving them open right now so that if we close them, they don't affect our credit score. Our hope is that if we have the opportunity in the next few years to refinance to get a lower interest rate, that we would do that in order to help us pay off our mortgage even quicker. But we're just not sure. Do we close our credit cards and risk that affecting our credit score? Would that affect it drastically or do we leave them open and frozen and kind of maintain our credit score. We just don't kind of want to tank it and lose that, that chance to refinance in the future.

[Jade Warshaw]

So. So there is something to be said about when you're going through the process of paying off debt. There's kind of this spoken or in some cases unspoken thought that, okay, when we do this, we're not borrowing money again, therefore we wouldn't need our credit score again, therefore we can close our credit cards. And so in your case, you're kind of thinking about, well, we don't plan on borrowing money anymore, but we want to refinance. And I can just tell you just from personal, personal situation, we have a mortgage and we don't have any other credit cards and we don't have anything else. And before we had our mortgage, our credit score went to zero. We purchased a home with a loan and our credit is like almost perfect and all we have on there is our mortgage. So you might see an initial drop just because you're closing accounts, but it's not going to go to zero and it's not going to be terrible because you're still have something major like a mortgage that you're paying every single month on time. And so there is part of that, that it's, it's going to make it okay and it's going to keep it, you know, in the upper range. And so I don't think you have to be worried about that. But I kind of, my question for you is, do you have any other qualms about your credit score? Because I do think that when you go and set out to follow the Ramsey plan, you have to know eventually your credit score is going to go to zero and you kind of have to cut ties with that old way of thinking.

[Rachel Cruz]

Yeah, and I. So ultimately, like, we do want our credit score to be undeterminable. Like, that is our ultimate goal. We don't plan on taking out any more debt. Like you had said. Like, we have two cars. They're old, they're paid for. So we have basically our credit cards are frozen in a safe. So we haven't even kind of activated the new ones that they send us all the time. But it's been more of a concern that because that was our extended length of credit attached to some of these cards that, you know, with wanting to potentially refinance in order to get the house paid off that we just didn't want to.

[Dave Ramsey]

What's your interest rate now?

[Rachel Cruz]

Like 6.8.

[Dave Ramsey]

Okay, so you guys just recently bought in the last year too.

[Rachel Cruz]

Okay.

[Jade Warshaw]

If I were you, I'd cancel them sooner than later so that your score has the ability to kind of do what it's going to do and then even out to where it's going to even out. And then when the time comes, who knows, when these interest rates get lower, then you will have a clear indicator of what it will be and it won't be in that fluctuation stage.

[Dave Ramsey]

Yeah. And Emily, when you look at the calculations of how a credit score is even mathematically determined, one of the pieces of the pie is new debt. And you guys aren't doing that. So in one sense, you got everything frozen, but you're not taking on new debt. So you're not playing the game naturally anyways. So there is a chance even because of that, mathematically speaking, you may even see a downtick slowly because you're not playing that game. And so if you're not playing it, I would just cut ties with it. And like what Jade said, even it back out or you know, if, if all else fails, like you're gonna be fine. You know what I mean? So. So in my head it is, it's just a. Because I don't want, I don't want accounts out there floating around even if they're frozen.

[Jade Warshaw]

No way.

[Dave Ramsey]

So just, just being able to get rid of them. Getting. Yes, like Jade said, when everything is back then and stabilized and sadly the truth is, who knows, who knows what's gonna happen in the future. So I'd rather take things under my control and do something that I can do, which is just get rid of them, close it out and then see how the world shakes out and then go from there.

[Jade Warshaw]

100.

[Dave Ramsey]

All right, next let's go to Kyle in Charlotte. Hey Kyle. Welcome to the show.

[Rachel Cruz]

Hey, how are y'all?

[Dave Ramsey]

We're doing well. How can we help?

[Rachel Cruz]

So I got a little dilemma. I'm just been started watching the Ramsay show probably two months ago and I'm currently in baby step one. I did get the Every Dollar app and using that created a budget. So I have, me and my fiance, we have a three month old baby girl. She has a 14 year old daughter that actually lives with us as well. We bought a home about two years ago. Mortgage is around 157,000 left on it. She has two vehicle loans, one's around 18,000, other ones around 8,000. So she also has three credit cards and she has a personal loan. So all of. So I, I don't have any debt currently in my name, but heard that all of her debt together is around 42,000.

[Jade Warshaw]

Okay.

[Rachel Cruz]

Not including the home mortgage.

[Dave Ramsey]

Okay.

[Rachel Cruz]

So she stays home. She's a stay at home mother. I'm a full time firefighter. I have two part time jobs as well. And I'm, I'm trying to figure out, you know, I am going to snowball the debt after I do the baby step one, which that's baby step two. But I'm trying to get her on board with the, with the budget.

[Jade Warshaw]

When do you get married?

[Rachel Cruz]

We actually aren't. I don't have a marriage date yet. That's what I was going to say as well. So our relationship is actually hanging on by a thread because of, you know, we don't see eye to eye on the financial state.

[Jade Warshaw]

That's a big deal. That's a big deal.

[Dave Ramsey]

Kyle. Has that, has that, has that changed in the last two months since you've been watching us or has it always been like that?

[Rachel Cruz]

So it's been like that more since my, my daughter was born. Yeah.

[Dave Ramsey]

Okay.

[Rachel Cruz]

You know, I've always been a saver and you know, now that my daughter's born, you know, I grew up, my parents separated when I was 12. I've seen, I know how that affects the kid and I don't want that.

[Dave Ramsey]

Yeah.

[Rachel Cruz]

And you know, I look at the future like anything can happen. So she's not like that. Like I asked her other day, because I was listening, I was like, you know, what is your 10 year goal? Where do you see yourself in 10 years? And she's, she's told me, she said, you know, I just, I worry about today, I don't worry about 10 years. And I'm like, you know, so when.

[Jade Warshaw]

You ask her her philosophy on, on money and you're asking her, hey, like, are you at a point in life where you're done borrowing? How do you feel about paying off debt? Is she able to give an answer that has any promise?

[Rachel Cruz]

So she will say she don't want to borrow any more money, but it's just like now, you know, she's made some financial decisions that I didn't agree with and you know, I don't, I don't have, I didn't have the control over that at that point. Well, it's, listen, you know, she can go do what she wants.

[Jade Warshaw]

The hard part is you guys are in, in a, the situation is made more complex because you're not yet married, but you're kind of in this situation where you're life seems like you're married. So you you feel like, listen, I have to step into my dad, her dad's my debt. And so the whole thing is very confused. And I think that as much as you can keep some clarity around that and either marry her or not, but I would not start paying off this debt until you've decided if this is the person that you're going to spend your life with.

[Dave Ramsey]

Yep. Yeah. And Kyle and I would have the conversation with her from a vulnerable, you know, not just, well, what are you, you, you pointing. Tell her you like what's going on in Kyle. What is the fear that you have? What is going on? And, and, and, and start these conversations. And you've said this before, Jade, on different shows, but like, it takes, it sometimes takes time.

[Jade Warshaw]

Yes. Right.

[Dave Ramsey]

You've had a mindset, a natural shift. And then Ramsey's probably confirmed that because we lean probably more on your side, Kyle, but you guys together need to sit down and have these conversations. But for now, keep the finances separate. You don't need to be paying on her debt because if she's not getting out of debt, she's digging herself deeper in a hole. You spent years trying to get everything just right for your family. Now you need an easy way to make sure your important financial documents are as organized as the rest of your house. Well, good news, Knockbox, that's nok box, as in next of kin box is a complete system that helps you be sure that you leave happy memories, not a mess when you pass away. Knockbox is a simple way to organize important paper and digital documents, IDs, tax returns, insurance policies, estate plans, accounts and other personal history in one manageable place. Your family will feel your love and every detail you take care of. So start taking care of [e-mail] Ramsey a well organized legacy is a gift to your family. That's nokbox.com Ramsey the Ramsey show question of the day is brought to you by why Refi? Why Refi refinances defaulted private student loans and builds a custom loan based on your ability to pay. Now, you guys, private student loans are different than federal student loans like Sallie Mae. So to learn more about this custom refinancing option and a lump sum payoff option that you can qualify for after 24 months, go to y refi.com Ramsey that's why the letter y refi.com Ramsey may not be available in all states.

[Jade Warshaw]

Okay, today's question comes from Matthew in Oregon. He says, my wife and I are debt free except our expensive townhome. We bought it in 2022, with a 30 year term mortgage, our monthly payment is about 4, 200amonth, including escrow and PMI, while our net take home pay is 8, $750 a month. Wow. Our annual gross income is 110,000, which means our housing costs take up about 5, 40% of our income, which limits how much we can invest. We both have the potential for income growth, but today's high cost of living is challenging, especially with four kids. We're in baby step four, five and six, but still feel trapped. It's hard to see a finish line of no mortgage payment. Should we stay where we're at and wait for our income to grow or sell our house and move? This is, this is one of those reality moments, Rachel. I think that if you're, if you're truly engaged in what's going on financially in your home, these are the moments where it's like, it's really tough because for those of you who don't know, here we teach that your payment shouldn't be any more than 25 of your take home pay. And the reason for that is, once it creeps beyond that, especially beyond 30, is you really do start to feel that. And you start to experience what we call being house poor. And your blessing, your blessing on the house now becomes a burden. Right. Because you're not able to have the margin to do the things that life calls for. I mean, in this case, it could be anything from child care, it could be anything from they're wanting to pay off their mortgage and they don't have any margin. Yeah.

[Dave Ramsey]

Well, if you're in baby step four, you're funding 15 of your income in retirement. So automatically that's taking it. You have 45 of your income to live off of. That's before food and utilities and everything.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

So it does, it starts to dwindle. Not always like in the right spots. Right. And so.

[Jade Warshaw]

And if you give 10%, forget about it.

[Dave Ramsey]

That's right now you're down to 35% and for basic living. So, yeah, it's almost that feeling of like we work too hard to feel this broke.

[Jade Warshaw]

You know what I mean?

[Dave Ramsey]

Like we shouldn't feel like this. And it is because 40% of your income is going to housing. And so. Yeah, yeah, I mean, I would be looking elsewhere because you say an expensive townhome, which I'm assuming is a really nice one. Probably in a nice area.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

And so I would be looking for other options. You know, you may be getting an older home. It may not Be near the city, because that's usually where prices go up the closer you are to the city. So you may be moving out and all of it, which I know with four kids, I know it's so easier said than done just to be like, oh, yeah, like, get up and move. I know that that's like, yes, could be changing schools, all of this, but the quality of your life and going to bed at night and having peace and not stressing and not being, you know, to this point of, like, on a. Like, you just feel like, oh, my gosh, I just go to. I go to a job and I have no progress in my life. Like, that is daunting.

[Jade Warshaw]

That's for the birds. You go think about how much time you spend at work. You go to work all day, eight hours a day. Some people far more than that. And then you. You feel like you have nothing to show for. You can't enjoy your life. You can't do the things that make you feel like you're making progress in life. Then there's the part of this equation, Rachel, where they do see a way for their income to go up. Now, there's been times people have called in the show and they're like, hey, I'm at 30 of my income, but I know that I have a raise coming up in the next 12 months.

[Dave Ramsey]

Yeah.

[Jade Warshaw]

And if we get that raise, you know, it'll equal out. And so there's a part of that where if they said, hey, we see a place where we're gonna get, you know, a 15 increase.

[Dave Ramsey]

Both of us.

[Jade Warshaw]

Both of us. Yeah. And that's gonna happen in the next 12 months. Maybe there's a part of this where you can ride it out.

[Dave Ramsey]

That's right. That's right.

[Jade Warshaw]

But only if that's 100% absolutely going to be true.

[Dave Ramsey]

Yes. Yeah. Don't be on a wish and a prayer of it maybe happening. And then you're stuck in the cycle for the next four to five years. Because that's going to be exhausting.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

All right, let's go to Will in Miami. Hi, Will. Welcome to the show. Hello. How are you doing? Great. How can we help?

[Rachel Cruz]

Yes. So my parents. My father bought a car years ago. This is a Mercedes. He's a retiree surgeon, and he now works as a surgical assistant here. Since all the recession and all the economic problems we've been going through the country, that area of health, he hasn't been able to get a job for the last year. He has some stuff on and off, but he hasn't been able to have a stable job. The payment for this car is $500 a month. $550 plus insurance. That runs up to somewhere between 650 to $700 a month. And because he doesn't have a job right now, been really difficult to maintain all the expenses.

[Jade Warshaw]

What's he doing to maintain it?

[Rachel Cruz]

I mean, right now all our family is working. We are immigrants, and everybody contributes.

[Dave Ramsey]

You're paying for your dad's car payment?

[Rachel Cruz]

No, I'm not. I'm just saying that everybody's paying their fair share, but the car right now is one of those crazy expenses.

[Jade Warshaw]

Are you in the same. Are you all under the same roof?

[Rachel Cruz]

Yes.

[Jade Warshaw]

Okay. And so explain to Rachel and I kind of how that works. When you say everybody's paying their fair share, what does that mean?

[Rachel Cruz]

So between my sister and I, we. The. Our rent is $3,000. My sister and I pay about half of that.

[Jade Warshaw]

Okay.

[Rachel Cruz]

And the rest of the expenses are covered by our parents, Although we didn't start paying until recently, until about six months ago. My sister just graduated from college. I'm still a student.

[Jade Warshaw]

Okay.

[Dave Ramsey]

How old are you?

[Rachel Cruz]

Oh, I'm. I'm 28. I'm just a late bloomer student.

[Dave Ramsey]

That's great. I was just curious. That's great.

[Jade Warshaw]

Okay, so it's just you and your sister. The. The agreement is we all kind of live under one roof, but together you guys pay for half of the rent and we pay for the other half and everything else.

[Rachel Cruz]

Yeah.

[Jade Warshaw]

And so you're concerned that since your dad is not working, how is he affording to pay for this Mercedes or this expensive car that he has?

[Rachel Cruz]

I mean, to be. To be honest, like, we cannot afford anything right now. Even though we are able to cover the basics, that doesn't cover the credit.

[Jade Warshaw]

Card debts my parents have.

[Rachel Cruz]

That's why I believe that the car is one of the things that is taking them down.

[Jade Warshaw]

So the hard. Oh, go ahead, Rachel.

[Dave Ramsey]

Well, so, okay, a couple of things, Will. Where did you guys immigrate from? I'm just curious.

[Rachel Cruz]

Oh, we are originally from Venezuela.

[Dave Ramsey]

Okay.

[Jade Warshaw]

Yeah.

[Rachel Cruz]

We've been here for eight years. We became citizens last year.

[Dave Ramsey]

Okay. And the only reason I ask is I do find even in the Hispanic culture, there is this, like, gathering of family. Right. There is. There is more than just the standard American that's like, oh, it's, you know, Americans. I just feel like we're more independent. And you just kind of, you know, you run. You run on your own track where other countries, other cultures, there is more of this like family oriented life. So I'm not saying one is wrong or the other, Will. But as a 28 year old guy, and I know you want to support your parents and be there for them and all of it for your, your own dignity. Will, as a man, emotionally, I do want you to somewhat separate what your parents have chosen with their own lifestyle versus what you're choosing.

[Jade Warshaw]

Right.

[Dave Ramsey]

So they've chosen to. Or he's chosen to have a Mercedes. Okay. That's his choice. You have not done that. The credit cards, I don't know if the credit cards are paying the light bill to keep the, keep the, the, you know, the house going, that's one thing. But if it's credit card debt that's coming from your parents that charge their own cards for their own lifestyle, that is, that is their money and their choices. It does get a little bit confusing when you are living under one roof. So I think, well, emotionally I would detach myself from your parents choices. And until they start affecting you, which they might soon will, there may be a point that you say, hey, I'm going to have to make a different decision for my life.

[Jade Warshaw]

Yeah.

[Dave Ramsey]

And I may have to go get a job, pause school and do something different because I'm not going to be taken under because of their bad choices. But here's the thing, Will. Jade and I joked earlier. We were like, it takes a lot of therapy to realize you can't change people. You cannot change people. So I hope that helps. Will, you're an awesome son and we wish you the best. Thanks to all the guys in the booth. Jade, thanks always for being a great co host. Thanks to our live studio audience here and now. Phil. Thank you, America. This is the Ramsey Show.

[Rachel Cruz]

Let me tell you that God's gonna cut you. It's Holy Week in Jerusalem. Crowds welcome Jesus as king.

[Jade Warshaw]

Rebellion is in the air. Jesus operates outside our jurisdiction.

[Rachel Cruz]

Rome will descend on us all. But instead of taking the throne, Jesus turns the tables. My house shall be called the house of prayer, but you make it a den of thieves. The world will never be the same. Coming soon to theaters. The chosen Last supper. Get your tickets now.

[Dave Ramsey]

Live from the headquarters of Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love and create amazing relationships. I am Rachel Cruze hosting this hour with my good friend and bestselling author Jade Warshaw. And we are here to answer your questions. So give us a call at 888-255-2225. We'll be talking about your life, your money, your jobs, your families, relationships. So give us a call. All right, up first this hour, we have George in Los Angeles, Louisiana. Hey, George. Welcome to the show.

[Rachel Cruz]

All right, thank you for taking my call.

[Dave Ramsey]

Absolutely. How can we help?

[Rachel Cruz]

I have $140,000 in debt right now, and also my wages are being garnished already. I've been sued from a loan. I didn't pay 25% of my income every week, every two weeks. So I just taking a lot of money. I make about 90,000 gross. I take home about 75,000 a year. My wife recently started working. I'm doing everything I possibly can to take, you know, more income, everything. But I'm already up to a point where I'm kind of thinking of filing bankruptcy or selling my house. So I'm thinking, what. What's the better option? Either sell the home or file for bankruptcy.

[Dave Ramsey]

Okay, so tell me what was what. What's the debt? The 140?

[Rachel Cruz]

Basically, three loans, three personal loans. They're one of them 50,000. The other one's another 50. Another one is 40. One of them's 20,000. One was a car. But I'm thinking I'm still. I want to pay the car off, so I'm not gonna put that one.

[Jade Warshaw]

The 20,000 is the car.

[Rachel Cruz]

Yeah, one of them is 20,000. That one's still good. I'm paying that one off. And the other is just all personal loans.

[Jade Warshaw]

What were the loans for, what you use them for?

[Rachel Cruz]

I got hurt a long time when I was working, and I needed a couple. I needed some money just to stay afloat my mortgage. So I just took out a lot of some loans and just kept paying it off. But then another one I took out to consolidate debt and ended up just splurging the money. Didn't really do what I had to do.

[Jade Warshaw]

So when does your wife. And then when does your wife start adding to the income because you're making around 6,000amonth.

[Rachel Cruz]

Started working like four months ago.

[Jade Warshaw]

And what's she making.

[Rachel Cruz]

About? I would say 1600amonth.

[Jade Warshaw]

Okay. Okay.

[Dave Ramsey]

What is she doing job wise?

[Rachel Cruz]

She just work. She just works at a veterinary place.

[Dave Ramsey]

Okay. Do you guys have kids?

[Rachel Cruz]

Yes. Two.

[Dave Ramsey]

You have two. Okay. And which of the loans are the ones that are garnishing your wages just from a bank?

[Rachel Cruz]

The personal.

[Dave Ramsey]

Is it one of the. One of the personal. One of the 50,000?

[Rachel Cruz]

Yeah.

[Dave Ramsey]

Okay. And are both of those personal loans with the same bank?

[Rachel Cruz]

No.

[Dave Ramsey]

No. Okay. And have you been current on the other fifty Thousand dollar loan.

[Rachel Cruz]

No, I'm, I haven't paid anything for, to anybody for a while already.

[Jade Warshaw]

Okay.

[Dave Ramsey]

Okay.

[Jade Warshaw]

And so you've got the house.

[Rachel Cruz]

Everything's. Everything's in collections, basically, except the car in the house.

[Jade Warshaw]

So they're, they're taking almost 2,000, a little under $2,000 a month. Right. Garnishing from you.

[Rachel Cruz]

Yeah.

[Jade Warshaw]

And then.

[Rachel Cruz]

Yeah.

[Jade Warshaw]

What percentage of your mortgage is. What percentage of your take home pays your mortgage?

[Rachel Cruz]

I pay 1800amonth for my mortgage.

[Jade Warshaw]

Okay. Okay. Oh, boy. All right. Yeah. We need you. You're not able to do anything here. Okay. So the key here is we've got to find a way to get more money coming in. And I'm wondering with the garnish, if. Is there any way that you can say, can we set up another payment program? Because this one is like burying me alive.

[Rachel Cruz]

I've tried everything already, spoke to the lawyers. I've done everything in my part to make some adjustments. I've done pretty much all I can do. I. Even if I get another job, they're still going to garnish. So at this point, I'm already maxed out. It's just, I don't see like, like another solution. They're just not budgeting at all.

[Jade Warshaw]

How old are your kids?

[Rachel Cruz]

One of them's eight and another one is five.

[Jade Warshaw]

Okay. Is the five year old in kindergarten? Is anybody in daycare? Is what I'm getting at.

[Rachel Cruz]

They're both being homeschooled.

[Jade Warshaw]

Oh, that's right. Okay. Okay. There's part of this that. And you, you and your wife are going to have to sit down. I mean, you're pretty much up against it and you could use all of the, the money that you can get.

[Rachel Cruz]

Right.

[Jade Warshaw]

Is there any way that. Because I, I don't know. I'm not going to pretend to know a ton about homeschooling, but I know that there's some programs where even though they're not going into school, they're going into a program that's outside of your home. Like a co op, like a co op type situation. Is there a way that you can still keep the value of homeschooling, but it's not your wife that's actually doing it so that she can work full time?

[Rachel Cruz]

That's something I haven't, I haven't thought about.

[Jade Warshaw]

I. And I'm not saying forever, but I think that you're in a. You, your back is against the wall and unfortunately, when that happens, something, you have to let go of something. Something has to change. In order for you to change your situation. And usually that is a sacrifice of some nature, and there's just no getting around it. But I'd rather you keep control of this situation once you hit. And, Rachel, you can speak more to this, but once you hand it over to bankruptcy, you lose control. And I don't want you to lose control of this situation. I want you to make every choice and feel like you have a say in everything that's going on.

[Rachel Cruz]

Okay.

[Dave Ramsey]

For the house, George, give me some of the numbers around that. What. How much. How much do you owe on it? How much is left on the mortgage?

[Rachel Cruz]

The house is. Right now it's 390 is what we owe. And five. It's worth about five. Almost 600,000.

[Dave Ramsey]

Almost 600.

[Jade Warshaw]

Okay.

[Dave Ramsey]

You know, the car. I would probably. I would sell the car. George, I know you're making payments on it, but that's something that can easily be swapped up to. To earn some money and margin back into the budget that you can go back and get later after all of this. But again, back to that sacrificial mindset. Like, what can you scorched earth do to have any means to be able to get ahead on some of this? Because some of it is in those. In collections. And keeping a car payment afloat is something that I would. Because, I mean, everything else is. Is in collections. And if you get on that, I don't want even re. You know, being repoed on. Like, I don't want anything like that. Like, you're in a little bit of that situation. That. Again, back to that control that Jade's talking about. How much could you sell the car for? Have you Kelly blue booked it?

[Rachel Cruz]

Yeah, I think I can sell it for, like, maybe 18. 18 grand around there.

[Dave Ramsey]

Okay.

[Rachel Cruz]

It's I. And I owe, like, about 18,000, so, I mean, I could break even.

[Dave Ramsey]

Yeah.

[Rachel Cruz]

It's just, you know, I mean, that's not. I mean, I. I guess I could do something like that.

[Jade Warshaw]

I mean, what's the payment on it?

[Rachel Cruz]

Just 500amonth.

[Jade Warshaw]

That's a lot.

[Dave Ramsey]

Okay.

[Jade Warshaw]

I mean, $500 to have that freed up is a big deal. And if you are upside down, like, this is one of those cases, if you're upside down, you go down to the credit union, get a loan for the difference and a little bit more in order to get yourself a beater if you need it. And I'd rather have a $5,000 loan than a $20,000 loan. Agree.

[Rachel Cruz]

Correct.

[Jade Warshaw]

Plus, you freed up $500, you know, a little Bit less than that a month when you take in consideration the new payment. Yeah, you're going to have to make some tough choices. Mom is probably going back to work. You're probably getting rid of this car and you might have to consider what's.

[Dave Ramsey]

In a job and then the house. Yeah, could be, could be in the in play. But I just want your habits to change as well, George. But you guys got this. This is the Ramsey Show.

[Rachel Cruz]

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[Jade Warshaw]

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[Rachel Cruz]

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[Jade Warshaw]

It's a no brainer. Just go to ramseysolutions.com smarttax and see how simple tax filing can be. That's ramseysolutions.com smarttax all right everybody, you're listening to the Ramsey Show. I'm your co host Jade Warshaw joined by Rachel Cruz. And during the break we were talking about, about non negotiables. And so many of us face this whether you are dating someone and you know you have to bring up those conversations, Rachel, about money, about, you know, religious views, possibly political views, like there's all these tough conversations to have and when do you know when you're dating somebody? When you get to that point that's like, okay, this is, I've hit my point. Right? Like, we talked to somebody who was in a relationship for three years and it's like, okay, maybe now's the time to start looking at this, talking about this. But it's hard to know, especially if you might see a little bit of progress. And you're like, yes, yeah, this is progress. Maybe we're going on the right direction. But what would you say Rachel is. Let's, let's, let's call out some red flags of if you see this, this might be pump the brakes.

[Dave Ramsey]

Money wise.

[Jade Warshaw]

Money wise.

[Dave Ramsey]

I was like, I don't know if. I'm not a marriage therapist. I don't know if.

[Jade Warshaw]

No, I'm talking about finances.

[Dave Ramsey]

Yes. I would say I always pump the brakes with people that feel like they have all the answers. Like when it's this idea that, like, I, I don't have any more learning to do.

[Jade Warshaw]

Oh.

[Dave Ramsey]

Like, I'm kind of just stuck in my. This is it. I'm good. And you're like, you don't want to grow or stretch or like, hear something different. Like to me in life right now, that feels so prideful. So with money and we get this call a lot with people that, as we're talking about non negotiables. So I guess there's a little bit on the other side of this. But this idea that, you know, we, we talk and they're like, well, you know, he just tells me, like he didn't want to talk about it. He's not going to talk about it. Or she, she won't even, she won't even enter the discussion. I'm like, that's exhausting. Like, that's exhausting. So you can have your non negotiables, but be, but be humble about it. It's that spirit that you bring to it.

[Jade Warshaw]

Well, let me be devil's advocate because there's somebody listening in their car and they're like, listen, I'm the one who, my spouse keeps talking to me about Ramsey this, Ramsey that. And whenever I try to tell her my views on why I want to keep my mortgage payment and invest it instead, she's so close minded. Like, she doesn't want to hear. She feels like she's found this plan and that's it. Like, there's no, like, let's talk about it from that.

[Dave Ramsey]

Yeah.

[Jade Warshaw]

Point of view.

[Dave Ramsey]

I'm her. I would be like, okay, so talk me through that. Let's run some numbers. Let's look, let's have a conversation right.

[Jade Warshaw]

Not just you telling him, well, this is what it is. This is what you should be doing.

[Dave Ramsey]

Preachy mentality. Yeah.

[Jade Warshaw]

Being willing to listen.

[Dave Ramsey]

Very much so.

[Jade Warshaw]

And ask questions.

[Dave Ramsey]

And ask questions. Be curious. Like, that whole spirit as a person, I think is really important. But when you're so closed off and you don't even want a conversation, that.

[Jade Warshaw]

To me is the big.

[Dave Ramsey]

That's exhausting. Like, you know, that would be a red flag for me. They won't even, they won't even talk about it. They avoid it, you know, all this stuff. And you're just like, oh, man.

[Jade Warshaw]

Yeah, I think that's a red flag. I think if you're talking about the future, like, say you're dating and you're talking about, okay, like when we get married, you know, what are your views on combining money that could, like, maybe, maybe they've been very open about their money up until this point, and you're like, yes, everything's going good. But then when you start thinking about, okay, when we get married, how is this going to work? Because I. My thoughts are that we would combine our money and kind of have our goals together. And if they're saying, oh, really? Because I've worked really hard for my savings and. Yep. That for me would be tough.

[Dave Ramsey]

Would be tough and a non negotiable.

[Jade Warshaw]

I think it's a non negotiable. But there's part. I'm not gonna lie, there's part of me that wonders if there could be a journey there over time.

[Dave Ramsey]

Yep.

[Jade Warshaw]

Yeah. So these are, you know, these are tough conversations, but I, I would urge people to start having them early. If there's one thing that I can say that I kind of feel like I learned in my marriage is we didn't talk about that dating. Like, yes, our dating time was very fun and not a lot of, like, we. I mean, we talked about heavy stuff, but somehow the financial stuff just wasn't really in there. And then after the fact, it was like, oh, wait a minute. Luckily, there were certain things that we just naturally aligned on. Thank goodness.

[Dave Ramsey]

Yeah.

[Jade Warshaw]

But yeah. Have those conversations.

[Dave Ramsey]

Yeah. And I would say debt would be one of those. I mean, it would be really tough to marry somebody. And they're like, hey, I want to go, you know, $500,000 in debt to do real estate. And I'll be like, oh, no, I can't do that.

[Jade Warshaw]

I can't do that.

[Dave Ramsey]

I can't. Like, that would stress. That would be. Because then you live as the spouse in the stressful state 24, 7 you know?

[Jade Warshaw]

Yeah.

[Dave Ramsey]

In investment, I'm saying, not just primarily, but it's like. Because I see these people on Instagram, TikTok, and they're all about real estate.

[Jade Warshaw]

Invest to their eyeballs.

[Dave Ramsey]

Yes. And I just watched that. I'm like, oh, my gosh, that would be so hard. That would be a tough. That would be a tough marriage for me.

[Jade Warshaw]

That is. Because on the one hand, and I mean, even if it's not real estate, even if it's just one person, like, I have this business go. Or this aspiration, I want to open a restaurant, whatever it is. But their viewpoint is I go into debt to do this. Yeah. And if you're the spouse who says, hey, I. I don't feel comfortable with debt. I don't like debt, and they view that as you're not supporting my dream or you're not. You know what I'm saying? Like, you don't believe in me. You don't believe this is going to work and we'll be able to pay it off. That right there, that's a very tough conversation to have.

[Dave Ramsey]

Yes.

[Jade Warshaw]

Now, don't get me wrong. I still stand my ground. Because I'd be like, I'm not like, can we do it over time? Is there a way to not leverage debt?

[Dave Ramsey]

Yes. Yes.

[Jade Warshaw]

Oh, goodness.

[Dave Ramsey]

All good things to talk about. It's hard and good stuff.

[Jade Warshaw]

All right, let's go to the phone lines where we've got Anna in Houston, Texas. What's going on, Anna? Anna.

[Rachel Cruz]

Hello. How are you guys doing?

[Jade Warshaw]

Doing good. How are you? Sorry I said your name wrong. It's Anna, right?

[Rachel Cruz]

You're okay? It is Anna. So I have a question, and I'm hoping that y'all can kind of help me out. I've been thinking about it for a little while. I am expecting to get a raise here soon, within the next, maybe two months at work. And it's about. I'm hoping, like, 20,000 extra a year. I'm not certain, though, if I should save that amount every year or use it to pay off my student loan debt. I have about 60. Yeah, I have about $65,000 of student loan debt that I just accrued here recently, going back to school to get my master's, and it's just me and my kids. I don't get child support.

[Jade Warshaw]

How many kids?

[Rachel Cruz]

And I have three.

[Jade Warshaw]

Okay.

[Dave Ramsey]

One.

[Rachel Cruz]

My son is 19 though, now, and so he's. He wants to go to school. That's a whole other situation and needing a little bit of money for that, but I guess My question is just, should I save that extra 20 a year for me and my kids, just, like, for security type stuff, or should I just use it all to pay off this student loan debt? Because I don't want it to go from 65 to $200,000.

[Jade Warshaw]

Of course. And that's a great way of thinking. Number one, congratulations on the raise. That's excellent. So if you're kind of new to the Ramsey show, we. We teach everything kind of through a series of baby steps, right? There's these seven baby steps that you can take that build on each other to ultimately get you to this place of financial peace, right? And so the advice that I'm going to give you is based on that. So the first thing that we want to kind of create this secure platform for you is you just need a thousand dollars saved, right? So if you can just out of that $20,000 raise or out of your bank account or whatever you have of money now, if you can just set a thousand dollars aside and just. Okay, I've got that there. And then the second baby step is, yeah, you pay off your debt. Because when you pay off debt, you're eliminating that risk. You're eliminating that financial uncertainty that's in your life. And that. That's usually the point of stress that people feel is, oh, my gosh, I've got to make these payments, or these debt collectors are calling me, or my payment is due. Right? That's usually the source of stress that people feel when it relates to their money. So in your case, I would say if you've got this extra money, congratulations, let's put it to whatever baby step you're on so that you can keep going in the right direction to get to that ultimate financial piece. And it sounds like in your case, you would be on baby step two, where you are paying off the debt.

[Dave Ramsey]

Anna, how much do you make in your job now?

[Rachel Cruz]

So I make about 4,000amonth. It's about 60,000 a year.

[Dave Ramsey]

Okay. And then with the $20,000 will come. So that'll be about 80.

[Rachel Cruz]

Okay, great. Already I have this. I have the emergency fund, and I even have about 30,000 in a CD account that I put up whenever I sold my house last year. So I have that.

[Jade Warshaw]

That's great.

[Dave Ramsey]

I would put on a. It's gonna make you nervous, but I would put that towards your debt, and that will take a huge chunk out of this debt. And you're gonna make great money. I mean, you're gonna make 80 grand. So you'll have $35,000 left. I mean, you could pay this off in 18, 24 months.

[Jade Warshaw]

Yeah. And honestly, when that CD matures, I'd probably put that on the debt, too and knock it out. 65,000. I. I would do that. And then once the debt is gone, I'd save back up that money and I just keep it in a high yield to where it's, like, very liquid. But, yeah, listen, I'm proud of you. I think that you're doing all the right things. You've got good instincts and good intuitions. Yes. You're doing great, taking great care of your family. This is the Ramsay show.

[Rachel Cruz]

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[Jade Warshaw]

All right, you're listening to the Ramsey Show. If you want to give us a call. It's a live show, so you can do that. The number is triple eight eight two five. Five two two five will get you on the line again. I'm Jim Warshaw. Next to me is Rachel Cruz. We're the ones that'll be taking your calls this hour. So let's go straight to the phone lines where we've got Samantha in Phoenix, Arizona. What's going on, Samantha?

[Rachel Cruz]

Hi. Thank you guys for taking my call.

[Jade Warshaw]

You bet.

[Rachel Cruz]

I am new to the baby step, and I was technically on baby step two, but I left an abusive relationship, and I'm going through a custody battle right now. So I've incurred additional debt for attorney fees.

[Jade Warshaw]

Okay.

[Rachel Cruz]

So I'm trying to figure out my next step steps going forward. Should I pause making additional payments, like, towards my debt and just work on saving money for additional attorney fees that might come up?

[Jade Warshaw]

Yeah, I would. This is definitely a storm. I mean, for sure, we. I would categorize this as a storm. And we do say that when you're in baby step two especially, there's a couple of things that would cause you to kind of pause, and that would be a baby on the way or some sort of storm or major emergency that is causing you to kind of have to just hold, hold tight for a minute.

[Dave Ramsey]

Yeah. That becomes more of a priority at that point than paying off debt.

[Rachel Cruz]

Right.

[Dave Ramsey]

We're all about paying off debt, but your child is a priority there. Right. If there's a health issue that you have to pause to make sure that you can get yourself in a healthy place that is, you know. Yeah. Pregnancy, like anything that is. Takes precedent. Right. Which is usually a relational situation or a health situation. We for sure say pause and get that in order. I'm so sorry, Samantha. I'm always so impressed with women like you that choose to step out of a situation like that because that cycle can be so hard to break out of. How long has this been going on? Just from the custody standpoint, fighting it with lawyers.

[Rachel Cruz]

So going on two years. The first part was when he tried to fight the restraining order. So that was the first time I took on attorney fees. And then now. And I. He was. He was in jail for a bit for violating the restraining order, but now he's out, so now he's trying to come for full custody.

[Dave Ramsey]

Oh, my gosh. How many kids do you have?

[Rachel Cruz]

Luckily, I only have one.

[Dave Ramsey]

Okay.

[Rachel Cruz]

And me and my daughter, but it's still a lot.

[Jade Warshaw]

How is your, like, financial situation? How is your home situation?

[Rachel Cruz]

So I currently rent, and I am safe. Luckily, I'm with family, and I make about 52,000 a year. But my debt went from. I got it down to 12,000, and now it's back up at 20. So.

[Jade Warshaw]

And what are you. Is that just the outstanding? Is that just the 20,000? Is the attorney fees?

[Rachel Cruz]

No. So about 10,000 of it was attorney fees. 6,000 was about credit card, 3 about student loans, and then about 2,000 left on my car loan.

[Dave Ramsey]

Okay. Do you have any. Do you have any savings right now that you're pulling from? Or are you just pretty much occurring the debt as the attorney fees come up?

[Rachel Cruz]

So I was able to pull from, like, 401k to kind of help with this because it was. So I wasn't expecting it.

[Jade Warshaw]

I know.

[Rachel Cruz]

I thought after the restraining order was standing that that was going to be it. So I wasn't expecting this. So I was able to get a little bit of help through that. But of course, I. I want to pay all of this back as quickly as possible. But my biggest fear is I don't know what's going to happen three to six months from now to the, you know, next year as well.

[Jade Warshaw]

Right. Okay.

[Dave Ramsey]

So are you still in the middle of this, then?

[Rachel Cruz]

I am, yeah.

[Dave Ramsey]

Okay. And has y'all. Has your lawyer given you any time frame by any chance? Like, do you know. I mean, you're saying three to six months, you know, like, does he have any conclusion of, like, when this will end?

[Rachel Cruz]

No. No, because we're still waiting on mediation and then more than likely that nothing's going to happen in there because my ex, of course he's not going to agree to anything.

[Jade Warshaw]

Does your ex have a lot of money? Is that why he's trying to. Is he trying to drain you out on this?

[Rachel Cruz]

Yeah, they think so. Because, yes, he comes from money. So he knows that I would do anything to protect our daughter. So he knows that I'm willing to, you know, for, you know, figure out ways to get the money, because he knows I'm not going to represent myself. I'm not in a position to do that, you know, emotionally.

[Jade Warshaw]

And so what. Is there anybody around you that has the ability to help with this, that wants to? Because the truth is, this is costing you money, and it's costing you money that you don't have. And I do believe, like, I'm. I believe that the custody is going to end up with you because from what you're telling me, there's clearly track record that this is an abusive person, especially the fact that he's ended in jail for trying to violate this. So I. I have a feeling that this will end with you. But how long can you go down this track? Do you see what I'm saying?

[Rachel Cruz]

Yeah.

[Dave Ramsey]

Yeah. So, Samantha. So I. Yeah, If I were you, if I was in your position right now, I would stay current on everything. I would not get behind. So I would say I would be paying your minimum payments on everything. And then on the side, finding that margin month to month, to be able to put some money aside. So as these fees come up, you do have an account that you're going to be able to pull from. And then I would also start to evaluate as much as you can, the consistency of how often the bills are coming, how often you guys are. You're using the lawyer, if there is mediation and all of it. Because I think a goal would be small goals would just say, okay, there's some money set aside for attorney fees. And the truth is I may have to go into debt for that, but if I can at least maybe knock out that $2,000, your car loan in the midst of this. Right. Because it's not something that's going to be solved. It sounds like even. Maybe even the next 12 months. So I don't want you sitting idle financially during that time, But I do want you to put some cushion between you and life. So putting Some money away kind of for an emergency fund that you can pull some of that for attorney's fees as they come up. But then also giving yourself a goal financially to start making some progress. Because honestly, too, Samantha, I think making progress in this area of your life, it actually might give you, you know, that boost of confidence. And there's something proactive that you're doing in your life that actually can, can start the wheels engaging in a, in a, In a positive way through the circumstance.

[Jade Warshaw]

Absolutely. I mean, you. There's only 2,000 left on the car. What's the payment on that? What will you get back in your pocket monthly when you pay that off?

[Rachel Cruz]

So I pay about 296amonth for the car.

[Jade Warshaw]

Good. So another 300. That's great. To Rachel's point, that's even more money that you. You'll be able to set aside. So, yeah, like, no disguising the fact that this is tough and, you know, you've got your work cut out for you in a lot of ways, but I think just being really intentional, still sticking to, still creating a plan and sticking to that plan, whatever you decide that plan is, is going to be really paramount for you. Walking through this. That's so, so, so, so now.

[Dave Ramsey]

I'm so sorry, Samantha.

[Jade Warshaw]

Tough to walk through. All right. Do you want to try to take another call right quick? Let's try it. Caleb in Norfolk, Virginia. What's going on? Caleb?

[Rachel Cruz]

Hey, thank you for taking my call. Merry Christmas.

[Jade Warshaw]

Merry Christmas. How can we help?

[Rachel Cruz]

So my question is regarding life insurance. I'm currently in the military, but I'm getting out in about three months. I have life insurance through the military. It's called super service members group life insurance. I pay about 31amonth for a $500,000 policy. My question is, whenever I get out, I have the option for a limited time, really, to roll that over into what's called veterans group life insurance, which is about $35 a month, and that will, you know, increase about every five years. I'm 26 now. I have no debt. But really I'm just unsure because I don't have a wife or children yet. I don't really have anybody relying on my wage but me. So I'm just kind of looking for some guidance here.

[Dave Ramsey]

Yeah, I mean, Kim, I don't think you really have to re up this or roll it over. I mean, I, I wouldn't. The reason really you have life insurance is if someone is dependent upon your income. So that would be a spouse or children. And as A single person. I mean, I would have some money, you know, set aside that if something were to happen to you, like covers funeral costs and that kind of thing. But I don't think you need a life insurance policy for that. So I probably would just end up up canceling it once you get out.

[Jade Warshaw]

I agree. I agree with that statement. And if you don't have to pay it now, I, I wouldn't pay it now. Forget the rollover. I would get out of it now if I could because you really don't need it. All right, that does it for that. Yeah. I think people forget all the time, Rachel, that there's a purpose purpose to life insurance. It's not necessarily to make you rich or all of these other things. It's for anybody who's dependent on your income. If something happens to you, how do they make life work?

[Dave Ramsey]

That's what it's. Children, spouses and term life is so inexpensive. It sounded like some of those rates, you know, it's just not expensive at all. And so yeah, if someone's dependent upon your income, make sure you get life insurance. You can go to zanderinsurance.com and check it out there because that's a great place to get your term life.

[Rachel Cruz]

Foreign. I talk to people every day who want to know how to do better in two areas, money and relationships. That's why I'm pumped to bring the Money and Relationships tour to a city near you. Join me and Dr. John DeLoney for a night that will challenge the way you think about this stuff and possibly change how you live forever. Starting April 21, we'll be in Louisville, then on to Durham, Atlanta, Phoenix, Fort Worth and Kansas City. Grab your [e-mail] tour before they're gone.

[Dave Ramsey]

Welcome back to the Ramsey Show. Let's go to to Ann in Pittsburgh. Hi Ann, welcome to the show.

[Rachel Cruz]

Hi, how are you today?

[Dave Ramsey]

Hi. We are doing well. How can we help?

[Rachel Cruz]

Well, I hope you can help. That's my question. Is there any hope for our situation? We have been married 19 years. We're in our 50s. We have one special needs son. We're both self employed. I have a business from home which has been very helpful with our son and being home when he gets off the bus, all that kind of of stuff. My husband has always controlled 99% of the finances. I don't have. My name is not on the bank account. My name, I don't have a login. His business and our home bills are combined on the same account, which I know probably should not be that way. We have a home loan of about 243. If sold, it might be worth 700,000. The big problem, I came to realize is that our credit cards are at 209,000.

[Jade Warshaw]

Wow.

[Rachel Cruz]

We have a car loan for 21. And some of the credit cards are his business only. But as far as I'm aware, you know, in certain states, your debt is your debt and half. And half debt and assets. So I guess I'm trying to figure out. I can't get through to him. He just blows up when I try to say, hey, let's try a budget. Hey, here's all the credit cards on an Excel spreadsheet that shows all the percentages. Like, it's just kind of banging my head on a wall. And I don't know how to protect myself, how to protect my son. The only good news is that I do have a 401k that is in my name from before we were married. And then we also have. I have a little bit of savings. And then he does have a life insurance policy. God forbid anything happens. But he's. He's not well, mentally. And he's been, you know, threatening a lot of things. And I thought I should try and get some advice.

[Jade Warshaw]

Are you thinking about walking away from.

[Rachel Cruz]

This at this point? I really can't right now. I can't right now. My business is here on the property. And if I would leave, the other thing is, I would be taking my autistic child away from the only home he knows that he's had his whole life. His dogs, his. Everything that's comfort to him.

[Jade Warshaw]

And your husband's not op, Is he? It's. I'm guessing, based on what you said, I think.

[Rachel Cruz]

I think he knows that. That he's in the toilet. I think he realizes. I mean, he's paying the minimums on the credit cards. That's it.

[Dave Ramsey]

And where's the. Where's the revenue of your business going, Ann? What account is that going into?

[Rachel Cruz]

It's going in with everything else. We. I mean, I don't make much.

[Dave Ramsey]

Okay.

[Rachel Cruz]

Last year. He had it written down here last year.

[Jade Warshaw]

Hey, do you think that there could be IRS debt as well? Because when you tell me that all the business bills and all the personal bills and everything's together, that sounds like a mess.

[Rachel Cruz]

I don't. I think he's pretty OCD about keeping track of stuff. Last year's GROSS Income was 233. But then by the time we got to the bottom of the income, the income is 26,000 once he takes off? Depreciation, all that kind of.

[Jade Warshaw]

What type of business does he have?

[Rachel Cruz]

He's an electrical contractor.

[Jade Warshaw]

So he's making 26,000 a year. He's paying himself 26,000?

[Rachel Cruz]

Technically, yeah. And it's just him. He doesn't have employees.

[Jade Warshaw]

And what about you?

[Rachel Cruz]

Just myself.

[Jade Warshaw]

And what. What do you bring in? What's your payment from your business?

[Rachel Cruz]

I'm lucky if I bring 10,000 or less.

[Jade Warshaw]

So you guys combined are living off of 36,000, and you've got the 21,000 in car debt and how much in credit cards? 206.

[Rachel Cruz]

209.

[Jade Warshaw]

209. Okay. And is there anything else that you think might be out there? Not including the mortgage?

[Rachel Cruz]

No. And of that, 209,40k is his just for his business. But of course, I'm pretty sure I'm liable for that as well.

[Dave Ramsey]

But everything else. And so is he using these credit cards to keep you guys afloat just month to month?

[Rachel Cruz]

Yes. Yep.

[Dave Ramsey]

And when you said he's not mentally well, what it. Do you mind going into a little bit more detail on that?

[Rachel Cruz]

I mean, there's. There's increased alcohol. Just, you can tell there's depression, upset. We'll even mention the debt. Will mention. My wife told me that we're this much in debt and, you know, she must be full of it. I don't believe it. And he'll say this in front of his best friends, and it's like, oh, my God. Now he's, like, sharing it with. But I think he's embarrassed. I think he doesn't know what to do.

[Jade Warshaw]

I do, too.

[Dave Ramsey]

Yep. So I think, you know, and it just sounds like my first protection is for you and the fact that you don't have any access to anything. Anne. I mean, there could be. There could be a whole other life he's living.

[Jade Warshaw]

Right.

[Dave Ramsey]

I mean, on. On different levels, on different scales, financially, not. I'm like, you have no clue what's really going on because the money is kind of the paper trail to a degree on life and. And being able to see that and you have no access to that, which is a hard line I draw. You have to be able to have access and be. Have everything visual that you see. I mean, it's one thing if you're like, oh, my gosh, he's a spender, I'm a saver. I know what to do. It's a whole other thing. And you cross another line into another level of seriousness when you don't have the ability to access your money. So. So this is a.

[Jade Warshaw]

It's.

[Dave Ramsey]

It's a. It's a. It's a more serious weight there that I. That I hold now in this conversation that. That creates more ultimatums. And I hear you say, like, I can't leave all of that. And. But what. What I would do is, is that there's other ultimatums in this marriage that has to change because you. You don't. You're not safe at that point. Right, Right.

[Jade Warshaw]

How'd you find out about the 209? Just curious. Did he tell you or you discovered it?

[Rachel Cruz]

Oh, he did not tell me. I discovered it. I started going through his files.

[Jade Warshaw]

Okay.

[Rachel Cruz]

I made, like, the biggest Excel spreadsheet you'd ever want to see in your life. And I just, you know, tried talking to him, and, you know, we were okay there for a while. Oh, I'm working. I'm paying it down, I'm paying it down. And then, you know, once a year, I'd pull these files again and get everything sorted. And I did it again this year, and I said, this. This is. He's. To the point now where everything is minimums.

[Jade Warshaw]

Yeah. For me, this falls into what I. What I would call a level of financial freedom, abuse and infidelity, because he's keeping everything on his side. He's making moves without sharing them with you, and they're at the detriment to you and your family and your son. And I would push back on the fact that there's nowhere for you to go. There's always an option. But I can guarantee you this, it is not going to be a comfortable option. There's going to be no piece of it that feels comfortable or easy or right. You know what I'm saying? So I do think that you have to give yourself an ultimatum, and you need to say, all right, what am I gonna do? What are my limits? What are my boundaries? And what is my time frame for me to. And. And what. What is an indicator that this is moving forward or that it's staying the same like you? Does that make sense? You have to have something very real and very measurable for this situation.

[Dave Ramsey]

Yeah.

[Jade Warshaw]

Yeah.

[Rachel Cruz]

Right. Right.

[Jade Warshaw]

So whether that's. Whether that's. I'm gonna offer counseling, and I'm gonna give him 60 days to agree to it, or I'm going to ask him for these account passwords, and I'm going to ask him for, you know, complete transparency, and I'm going to give him 45 days to. To wrestle with that and get to that point, you've just got to make it very clear. Write it down on paper. If you have a friend, get a friend. If you have a pastor, find a pastor. But you need somebody who knows. Does anybody else know this is going on besides us? Two girls on the radio?

[Rachel Cruz]

Yes.

[Jade Warshaw]

Okay.

[Rachel Cruz]

A few. A few friends. Close friends and family members.

[Dave Ramsey]

And what are they suggesting? What are they saying? Since they know the situation even more.

[Rachel Cruz]

And they know him and. And they know he's not. He's not right. He's.

[Dave Ramsey]

Yeah.

[Rachel Cruz]

You know, I married the 37 year old man who was set in his ways and. And unfortunately, he is a collector and that's where the money has gone. He collects things. And to the point I said, can we sell some stuff?

[Jade Warshaw]

So is he hoarding too? Like, are you in that sort of a situation?

[Rachel Cruz]

No.

[Jade Warshaw]

Okay.

[Rachel Cruz]

No, it's just enormous collections of things that are really our only hope. These assets that could help us get out from under this. But he's not willing to touch. I'm not selling any of my stuff. He says, like, oh, it's great, because years ago he did, he would sell a stamp collection or he would sell a mother collection.

[Jade Warshaw]

So you're just seeing a deterioration.

[Dave Ramsey]

So, Ann, I would bring in a third party in that. And again, and it's so hard to say this on this side of the desk because now, Ann, we have to go. But you're going to be living this life, but not only is it a secret, but you're also behind. You're trying to live on $34,000 a year as well. So there's two ends of this that are really urgent. So I'm so sorry. I hope this was helpful to give him some ultimatums, but I so, so appreciate the call. This is the Rams.

[Jade Warshaw]

Hey, you're still here.

[Dave Ramsey]

What are you doing?

[Jade Warshaw]

You do know that the rest of today's show is playing right now over on the Ramsey Network app, Right? All you gotta do to finish the episode is search Ramsey Network in the app Store, Google Play Store, or just click the link in the show notes to download the app.

[Rachel Cruz]

For free.

[Jade Warshaw]

Yep, you heard me right.

[Rachel Cruz]

For free. Then right there on the home screen.

[Dave Ramsey]

You can watch the rest of today's show.

[Rachel Cruz]

Bada bing, bada boom.

[Jade Warshaw]

All right, I'm getting out of here.

[Rachel Cruz]

Enjoy.

[Jade Warshaw]

We'll see you on the app.