Debt Doesn’t Have to Run Your Life

Doing nothing with your Medicare plan could cost you hundreds or even thousands next year. Chapter can help you avoid that. Go to askchapter.org/ramsy. Brought to you by the EveryDollar app, start budgeting for free today. Normal is broke and common since is weird, so we're here to help you transform your life from the Ramsey Network in the Fairwinds Credit Union Studio. This is the Ramsey Show. I'm Rachel Cruz, hosting this hour with Jade Worshaw. We are going to answer your questions about life money, so give us a call at Tribal 8-825-525. A purse we have Andrew and Providence, Rhode Island's. Hi, Andrew. Welcome to the show. Hi, guys. Thanks for taking my call. Absolutely. How can we help? I have a question. I'm a licensed plumber and I'm very fortunate enough to have a high paying job that I've been working for, it's going for many years and a partner and I have opened up a side business that has actually turned into something within the last five years. My question is, how do you know when it's time to stop letting fear of the unknowns? Hold you back and actually take the leap of going full-time with the business. I love this question, so tell me more about the fear of the unknown, what's your fear? When you look at this, tell us the things that you look at and think, "Oh gosh, what if that happens? What if this happens? What if that happens? Tell us what it is." I think a little bit of it has to do with financially. I mean, I'm not in any sort of my mortgage, but like I said, I do have a high paying job for the field that I'm in and within this past year, I've proved to myself that the side business income can outdo my normal full-time income. How many months has it outdone your normal income? So my base income up to date is roughly like a hundred and eighty for my full-time job and my side job right now, just over 300,000. Oh my gosh. Wow, so every single month you've outpaste your normal job and that's doing it part-time. Correct. So I'm not going to lie to you, so I am full-time during the day for my company and then I'm full-time for the side hustle as well, and that's another reason why I'm struggling and trying to figure out to make the jump because I do have a five-year-old child. Is it. I want to be there. What kind of industry is it that you're in, the side job? I'm plumbing. Plumbing in HVAC. Oh, is the side? Correct. Yeah, so I'm in the side. That's what you're starting to do. Okay, I'm so sorry. I got you. But you have a partner, so if you were making three, three whatever you said, you're only receiving half of that, right? No, no, no. So where over a million dollars is here between me and my partner? But what's profit? What's profit? What's profit? So profit, where roughly like 600,000 between the two of us. Wow. So you're taking. You could take home 300,000. Yes. Yes. Yes. Yes. Okay, so what's in retained earnings? It's. What do you mean by that? Sorry. So your company, you guys should have some money that you're setting aside. Six months would be good, three months would be good of money. That's like, hey, this is what it takes to operate the business. If we have down months or low months, what do you guys have set aside in the business? So right now we have roughly 70,000 set aside in the business. Every job that we complete, because it's just been a side hustle for us, we contribute 50% back into the business. Very good. Okay. Yeah. And usually these service companies, Andrew, have, they don't have great margins, but yours is unbelievable. So I'm wondering how your, what this looks like with equipment and are you guys just going and fixing? Are you installing? What are you guys doing? I would do everything, so we don't say no to anything. It's new construction, a lot of commercial projects within the last year. Okay. I'm just making it cost now, it's to the point where it's kind of affecting my day job. Yeah. Sure. I built a very good reputation with the employer that I work with, and it's not fair to him to me to be putting my effort into my own business and kind of lacking on, you know, so. So how many, obviously you're doing really well and how many months have you been in business? So we've been doing, we've been a legitimate LLC for the last five years. Okay. And in the last five years, you know, we started out with, you know, just picking up crumbs and going $25,000 profit for the first year and the next year. Okay. So you've only just grown organically to this point. And honestly, when I hear that Andrew, it sounds like somebody, it sounds like two people who have done this the right way, which is you started with what you had a little bit of time here, a little bit more here. And now you're at the point where it's like, gosh, you've really grown this. You've got the $70,000. How many operating months is $70,000? What does that get you? Let's just say you had a couple of down months. What is that $70,000? How far does that $70,000 go? So I think it would carry us for a good two to three months. I mean, it varies because some of our supply house bills in a month can be $30,000, $40,000. And then sometimes it could be $10,000. Yeah. Yeah. So it's, yeah. Well, you've given us, I mean, honestly, Andrew, I feel like you've been overly conservative to say in your full-time job. I mean, we usually would say if someone's side hustle makes it like even half of what their normal gig is making and they could double the time on the side hustle to match it. That's a really good starting point and some people just kind of jump ship and start there. And you've done it for lots of months and you've doubled it. I mean, you've tripled about doubled, doubled what you would have made. And there's enough proof that, I mean, obviously the business and how you guys are running it is working and it's been slow. So I mean, I for sure think doing this full-time because I think there does get to a point like what you're saying is you're, someone's paying you to do another job. If you feel like suffering, yeah. You know, like so, but no, I think, I think you're to that point. I think one of the biggest red flags we sometimes see or avenues that people can walk down that is not great, especially in the service industry because we work with so many small businesses and on-trail leadership is you're going to, as you put all your effort into this because it's just been split a little bit because you're your other job, it probably is going to continue to grow, but grow at the speed of cash because it's so easy to be like, gosh, we need three more trucks, we need to hire someone. And again, equipment in this industry, which you would know better than I would, but yeah, it's a lot to manage inventory and all of it. And so making sure you're ahead from a cash perspective and you don't go down the debt road would be the only time I could see you getting in trouble and getting in over your skis. Got it. I agree. And we'll give you Dave's book, Build a Business You Love. It sounds like you're on the right track, but that can help you fill in any gaps to continue to grow this. And yeah, I mean, I'm with Rachel. I would say green light, like if your wife feels good about it and you feel good about it, make the jump. You're there financially for sure. Yes. And in that book, I'm pretty sure it has a section on partnerships or on-trail leadership might, but it's something to consider too. If you're going all in on this business and there's someone structured and there's someone else tied to it, Andrew, which obviously in your partner have done this for five years. So you're in motion, but just being out ahead if this is your livelihood of what that looks like from the partnership perspective, if something happens or what that looks like, that could be another conversation to have just to mitigate any level of risk in it, but that's amazing, Andrew. That's like everyone's dream. Dream is to start something on the side that they love and they're good at and it takes off. Your livelihood, it's awesome. Congratulations. Yep. Well done. Hey guys, George Campbell here. There are a lot of things you probably shouldn't ignore. Check engine light, that weird smell in your fridge, the smoke detector that's been beeping for six days, and maybe most importantly, your phone bill. The things we ignore have a funny way of costing us the most. And your phone carrier is counting on you, ignoring that overpriced bill month after month so they can keep charging you more and more. But that's not the case with Boost Mobile. 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And I have a retirement, I have a pension, and I have a thing called a drop account. It's a deferred retirement option plan when you retire. So when you separate from your job, you still work at your job. They take your pension money and invest it for five years. In what? In what? You completely separate. Oops, sorry. What's it invested in? In the market. I took an index. I'm not sure. Okay. It's some kind of like, I don't know if an index fund or something, but it's market rate. Okay. If you're officially retired, you now have your pension, you have your drop account, they call it. Okay. And then you have that. So I was thinking about taking my fourth, my Roth IRA that I've been putting into the last couple of years, and just depleting that and just paying off the card debt. And because I have the other two retirements when I retire, that makes sense. Right. But you've got time to pay off the $53,000. How old are you? Right. 35. How much do you make? I think last year, we took in about 120 or to about 120, 125, I think, and then my wife took in probably like another 9,000, she first part time. Okay. Okay. So about 130 before taxes. So no, just I would not pull money out of any retirement accounts because not only are you unplugging all the growth that it's, you know, that it's building into right now, but you are going to be paying a penalty and when you do it, when you, when you pull the money out early. And so avoiding that penalty, letting that money go and then cash flowing this credit card debt because I guess it technically would be an easy button just to take money out and then pay off the debt and be done. But again, you're unplugging something that is continuing to grow. And yes, even if you feel like you have enough in the other retirement accounts, I would say I would rather have more in retirement and sacrifice for about 14 months of my life and pay off this credit card debt. What else do you have in retirement? What's in the pension? What would be in that deferred drop? Sorry, yeah, the pension is just based off of your salary at the end of your career, like at the end of your, when you go to retire, it's almost like the last couple of years. Okay. It's luxury rates, depending on what the salary is. I guess my bigger question, let me get to my, are you trying to retire earlier than average? Is that what you're attempting to do? Well, yeah, like my retirement, I would be eligible to retire probably around 15 years left. Okay. I guess I was trying to get to, it's, it's generally, and Rachel talked about this, but it's generally a pretty desperate act for people to be looking towards draining their retirement, pay off a debt, or pay off their, you know, pay off their home early or something like that. And so I was just trying to find out what was so dire straits that you felt like you needed to do something like that. I would just kind of say, like the paycheck that you pay check, like, you know, we messed up. You, some of we had to do some of we didn't have to do is the 53,000, the only debt, or is there more out there? Yeah, that's the only debt on credit card. We have about 150 in our, we have a mortgage for like 360, and then we have, we took out, we had to replace a few things, so we took out like a hundred 50,000 dollars equity. Okay. So there's a he-lock of 150. Yeah. Okay. So we're locked in rated eight for eight percent. Let's talk about that for a second because my question is what caused the 53,000 of credit card debt? And you're making one third, you're feeling like you're living paycheck to paycheck. That kind of feels like, um, a budget issue or like a month to month issue. Yeah. Because you make, I mean, the truth is you make too much to feel that broke. Wouldn't you agree? Yes. Yeah. So if I were you, do you guys have an every dollar budget? Yeah. I have the app. I have it. You used it. There we go. Yeah. Yeah. I think that's the problem here. I think that if you and your wife opened up every dollar tonight and just said, you know what? Our homework for this week is we're actually going to set a budget that we both agree with. We're going to sit down together. We're going to fill this thing in and we're going to let this be the guiding principle of how we spend our money. And I think that when you sit down with that, Joseph, you guys are going to find where you actually do have margin. And I think you're going to find the areas that you had no idea that you were overspending in such a major way. Yeah. Because you guys have been shuffling around debt to fix things. You've got, you got the heel lock out, you know, you're the credit card debt. Now you want to pull money from retirement to pay this off. But never once has, have you had to say, what do I have to change? I can't just be grabbing money from all these places to fix the problem. Right. The problem with our money is us, right? And so by doing the budget, like what Jay's saying, it's going to expose and show you guys how you're actually handling money. And the scary thing is people will do that with retirement accounts. And then they look up in two years. No habit has changed. They keep living, how they've been living and you look up and you got another $25,000 in credit card debt. You're like, how man, we shouldn't have done that, you know, but the pain of the process of forcing yourself to change and forcing yourself to pay this off, that changes you guys as a couple. And ultimately, that's what you want at the end of the day is we don't want an easy button to press and to wipe this clean because that doesn't do much for our behavior change. My prediction, Joseph. My prediction is you guys, you'll sit down tonight, you'll do this budget. You're probably going to find that much of the money that you are looking for has been eaten away in some form of entertainment or meal or grocery or trips, right? And when you start to tighten that up, my guess is that you'll be out of this $50,000 of debt in the next year or so, you'll be able to clean it up. And then you're going to save three to six months of expenses. And I think once you do that, it's going to change the whole trajectory of how you experience your money because then when things pop up, things that are unexpected, emergencies, you're not going to be reaching to HELOX when something needs to be done on the, on the house, you're going to have the cash flow to actually do it. And I think that you guys locking in for the next 18 months and doing what it takes to knock out this debt, stack up your first three months of expenses, I think it's going to change you. Have you ever had three months saved? No. No. Yeah. So I mean, honestly, $3,000 a month gets you guys out of debt in about 18 months, 17, 18 months. And my prediction is my hope is that as you guys go through this process, you find more money somewhere else. That's not retirement. You're like, oh, you know, there's some here, throw it. You get a raise. You decide to work an extra job like, right, this, this snowball effect really happens. And pay off. Is it multiple credit cards? How many equal to 53 here? I think if you do all of them together, it's like six total, three. Okay. So list them out, Joseph, smallest to largest, each of those credit cards and start with the smallest one and just and knock it out and you start going down that list and down that line. And there's something empowering about it. It's a, it's another testimony that credit cards, they're not helpful. They're not there to help you and set you up to win, right, they're, they've gotten you guys in trouble. So cut them up. All six of them need to be gone. And this is really shifting from this paycheck to paycheck living out of desperation. We're going to pull money from our house, from our retirement, just to feel more secure. You're going to go from there all the way to actually from a number standpoint, truly being secure because you're going to be in control of your income, doing a budget. You're going to be paying off your debt and in 18 months, you will have no credit card debt. You'll still have your retirement count out there and you guys will have your money that you're working so hard for and you're going to control it and actually be the adults in the room. And, and that's a beautiful thing. And then you, you expand that out for five, ten years and a lot of, a lot of great things can happen. So Joseph, you've been given some very clear homework and I'm going to add one more thing to the list that's going to help you find money really fast. So we told you tonight you're doing every dollar will give you that for free. Rachel said do the debt snowball list them smallest to largest. That's the way to do it. She also told you to cut up your credit cards and I'm going to add one final piece of homework which is I want you to pause retirement investing. I think that you're still putting some aside to go to that drop account. Let's pause that temporarily so you have that money at your disposal so that you can do the things that Rachel is telling you. Those four pieces of homework. Yep. Well done Joseph. We're glad you called in. Call us back. Let us know how it goes. But we're here cheering you guys on. (upbeat music) If you're shopping online and these days, everybody does, data brokers are out there right now buying and selling your personal information. Your phone number, your home address, your email, without your knowledge or consent. And that puts you at risk for spam calls, scam texts, and fraud. Combined with AI, those scams are getting more sophisticated every day. 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And getting control of your income is one of the basic first steps of winning with money because your income is what you do everything with, right? From saving, to giving, to investing, to paying off debt, and so using your income for good things in your financial world is very important, but knowing where it's going is what's key. So if you guys haven't checked out every dollar, make sure to do that. You can do it for free by downloading in the App Store or Google Play. So not only is it a great budgeting features in it to help you control your income and know where it's going, but also just the roadmap of your overall financial picture. So again, you can download it in the App Store or Google Play. I was good to math you in or Lanto. Hi, Matthew. Welcome to the show. Hi, how are you today? How can we help? Good. So I am 20 years old. I make about $58,000 a year. I'm a server in Orlando. And my question is, I'm looking to get my first home, a condo, about $110,000. And there's a program in my area that can Orlando. That's a down payment assistance. That's a forgivable grant for $40,000 that I don't have to pay back as long as I live there for 15 years. I have a car payment. I owe about $23,000. I bought about two years ago at $358 a month. And then I have two personal loans with each balance is about $5,000. One is $147 a month. And one is $121 a month. OK. And then I have about eight credit cards, but I have no balances on them. Then why have them? Just as comfort? I have them. Well, I have a United card. And I do that to get all my miles. But I don't have any debt on them. OK, I'm so glad you called in Matthew. And I don't know how you guys feel about down payment assistance or I just wanted some advice. Yeah, they're usually not great programs. Either you're having to get a double loan and they do a down payment loan with the mortgage. There's that. There's sometimes fees associated with these or strings attached. 15 years in a condo, Matthew. Crazy work. No, no. We're not doing that. We can't do that. You're running me in that condo for 15 years, Matthew. Let's take a poll. There's, we have a wonderful studio audience out there. How many of you have been in the exact same place with zero movement and zero change in your life for 15 years? Well, just the kids. We have a school. Just the high school, the school, the school ains people back there. They're all raising their hands. The point is, that is not the case ever with anyone's life. I mean, what if you get a new job? What if something happens and you have to move? And you don't want to lock yourself into a situation for 15 years. And I would say that with a job. I would say that with a student loan forgiveness thing. I would say that with a mortgage like anything. If it sounds too good to be true, Matthew, it usually probably is. And this doesn't even sound like good to be true. Yeah, Matthew, you are not in a position. I don't think to own a home. I know you want to. And I want you to be able to soon. But right now, I mean, man, you got a car that's almost half your annual income. You got two loans. You're playing the credit card game. I mean, there's just a lot up in the air. I mean, you're not. Let's just call a spade a spade. You don't have a good financial foundation right now. And if you build anything on top of that foundation today, it's going to crumble. Didn't you say you're 20 years old? Yes. So why are you in such a? Why do you feel such a rush to buy a house under such? Well, to the point of finding assistance and not putting a down pay. Why do you feel such? Rush well, I actually, I wasn't. I wasn't like technically like in a rush. I've been renting for about a year and a half. But then I heard about this program. I was going to wait a few years and save for the three percent. And then that's what I was going to do it. But then I heard about this program and I just, I didn't really know if it was that good of a decision. And I wanted to look into it more and I wanted to give you guys a show. I want your TikTok. Well, Rachel and I'm trying to get out of my personal loans. And I think I can get out of that with any year. Oh, good. Yes. Yes. Rachel and I are going to be your big sisters and help you with this because I think Matthew you're in such a wonderful place. You're still really young. You're 20 years old. And now is the time to lock in on the habits that are really going to help you solidify that foundation that we were talking about earlier. And Rachel's right, $23,000 car. My first place to start would be for you to have a thousand dollars saved. It sounds like you don't have any saved. So let's get a thousand dollars saved. That's baby step one. I have about five thousand dollars. Okay. Then that moves us on to baby step two, which if you follow our TikToks, you know we are going to tell you to drain that down to a thousand dollars and we're going to tell you to put any extra savings above the thousand on to your debt, just consumer debt. And let's knock that out along with your income. You have the eight credit cards that have a zero balance. If you really do rock with what we're saying, let's go ahead and cut those up because it's just temptation and you're spending more and you're spending more with them. Just so you know, versus if it was a debit card. Yeah. Well, I always like pay off my balances and I got built up my miles and my points. But look what you have to show for it. You don't have anything to show for it, Matthew. You've only got a bunch of debt and you were looking over here trying to do a crazy downpayment assistant program that was going to put you in a worse way. So I would argue that what you're doing right now isn't giving you much to show for it. Because right now, if we were putting positive money habits as tally marks, positive and negative, I don't see any that are in the positive just yet. Besides the five thousand dollars that you saved, so we applaud you for that for sure. But everything else, it's just, yeah, it feels a little, I know you're playing the games. It's like a little sloppy. I think if you tighten it up and you said, you know what, I'm only spending a certain amount of food every month. I'm only doing this, this and this. I'm just using my money. I'm going to spend my money in the present, meaning I'm not going to get a bill at the end of the month. And you are like really militant, Matthew, and you maybe even work extra hours. I think you can get this cleaned up. And you may even consider selling your car. I mean, I don't know how much it's worth, but that's something to look into too if you want. So there's, there's some levers to pull here that I think will help you get ahead, but continuing to play the debt game and going deeper in debt with this assistance program before you even have, you know, an emergency fund saved would not be wise. So no, I would hold off on being a homeowner and start working your way out of this debt first and foremost. But you can do it, Matthew. I mean, honestly, this is, so many people start at this point and they make such progress so fast. Yeah. And, you know, again, 20 years old, I think there's a lot of pressure out there. You feel like you're competing with whatever you see on social media. You feel like you're competing with what you feel like, you know, you should have by now. Some of us are competing with what our parents have. And we're trying to create that life that we just came out of, you know, they've got the homes and the cars and they're taking the vacations. And so I would just tell you, Matthew, that you are in exactly where you need to be. You've got your first job. It sounds like you're making a good amount of money. But now let's lock in on the right habits that are actually going to build a good foundation to where you can build lasting wealth. And it really does start with taking your money to Rachel's point and deciding what you're going to do with it. If you make the right choices with your own income, you will not have to borrow a dime from anyone until it, you know, when you come time to buy your house, that's fine if you want to do a small mortgage there. But do you see what I'm saying? Yeah. Yes. It's powerful. All right. We got Angela from Facebook. She said, "What are your thoughts on making micro payments to pay down debt at the end of every pay cycle?" I may have $20 to $30 left in my budget. Saturday morning, if you've ever had a huge list of chores. And you're like, all right, I'm going to do a little bit of the gardening, but I'm not going to finish it. I'm going to kind of do the dishes, but not finish it. I'm kind of going to put a little laundry in, but not finish it. I'm going to vacuum half of the room, but not finish. You will have spent the whole day toiling and not have one single thing to show for it. - Completed. - Nothing completed, yes. - But how great would it feel just vacuum? And then check that off your list. To finish the dishes, check it off your list is the same thing with debt. Finish one. Focus on the smallest day. And that goes for anybody listening. Whatever your smallest debt is, you might have 10 debts. I challenge you. Focus on the one debt. Make minimum payments on everything, but focus all your extra margin to the smallest debt. I promise you, you will pay it off quickly and you will feel so much better being able to check that one thing off your list and you'll be motivated to tackle the next thing. 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That's shopify.com/ramsie. Shopify.com/ramsie. (upbeat music) - If you're wondering why we keep mentioning the baby steps, because they are really the foundation on everything that we teach. So if you are new here, start there. We can have a link down below to walk you through what those are, but the seven baby steps really is your guide to what to do with your money from feeling positive out of control, feeling like your paycheck to paycheck, nothing to show for it. Not a lot of savings to all the way. All the way to baby steps seven, which is everything's paid off, including your house. You're doing retirement. Kids college fund is funded, you got money in the bank, and you just are feeling great. So it gets you there. It takes some years. Take some time. It's definitely, we always say it's a crock pot, not a microwave around here, but man, the journey is worth it. - Okay, so let's do a quick teaching on this, 'cause I think it's worth it. So seven baby steps, let's just go through them real quick, 'cause we started with the last caller. Baby step, when you get the $1,000 saved baby step two, you pay off all your debt, except your mortgage using the debt snowball baby step three. You're saving three to six months of expenses. Baby step four, you're investing 15% of your gross. Baby step five, you're putting aside a amount of your choice to a 529 or college plan for your kids. Baby step six, you're putting aside extra money to pay for, to pay your house down. Again, up to you, how much you wanna do that? Baby step seven, you live and give like no one else. And by the way, if you're thinking of buying a house, that's back in baby step three. We call it three B, you can say for a down payment. But I said all that 'cause I wanna say, sometimes people are like, Jade, Rachel, baby steps in today's economy, that really feels like giant leaps to pay off your debt, to save for a down payment. And so I just wanted to take this moment to think about a question that I get a lot of times on social media, which is, where can I start before that? Like, is there anything that I can kind of do to kind of like ease my way into these steps? And I thought that, like that's a very fair question. - Yes, yes. - And the first thing is, and this is so important, and a lot of people glaze over it, but you really can't do the baby steps unless you have a budget. That's thing one, so many people will kind of ramp, try to ramp into the things we teach, Rachel, but they don't have a budget yet. So if you're, haven't done that, that's precursor. Like, let's do that first. And then the second one is something that I think in many ways is very easy to do, but it costs people a lot mentally, and that is the very first step that you can make for yourself is simply to say, I'm not gonna borrow anymore. And if you're sitting there watching this and you're like, gosh, this feels overwhelming, can you just start there? Can you start with saying the credit cards in my wallet? I'm not gonna scan them anymore. I'm not gonna look to dead. I'm not gonna drain my 401K. And put that into practice month after month, and when you feel like, oh gosh, I feel like I'm actually able to use my own income. Now, now let's start with baby step one, and I think that that's a very reasonable place for anybody in today's economy, no matter what you're facing. It's a good place to start. - It's great. All right, let's go to Sophie and Providence, Rhode Island. Hi, Sophie, welcome to the show. - Hi, thank you, how are you guys doing? - We're doing great. How can we help? - I came here looking for some advice. I'll tell you a little bit about myself. I'm 25. I'm a construction project manager. I make six figures. I have about $220,000 fully invested. I have no debt. I own my car. I live well. - Wow. - We really cheaply. - Well done, Sophie. - I feel like, thank you. Thank you, my parents taught me well. They're huge trans. And they made it very clear. This is how we live. (laughing) Sophie's 25, making six figures like this is how we live. We do, hey, it's worked. It's worked. It's pretty amazing. - They didn't give me an option. - They said, this is what we do. They sent me to college and they said, we go do well for yourself. - Oh, I love it. - I love it. - I love it, Sophie, awesome. - Thank you. So, yeah, things are pretty great personally, except for one thing. I've been on and off with a guy for over three years now. And I think-- - The dude, money. - It's always the guy. - You think he does what? - I think he hates money. - The combination of being afraid of it and hating it. - What do you mean by hating it? - Hate to have a career. Like he-- - So, he hates working. - He hates working. He thinks rich people are evil. - And he's your boyfriend. - And he finds him really attractive. (laughing) - So, we're both kind of-- - He's got big muscles. - We're very outdoorsy. We do a lot of like skiing, mountain biking. We have a great time together. But then once reality sets in about once a week, when I sit him down and say like, "What are you doing?" - Yeah. - He's not so good. - So, he's just mountain biking during the day. - He's just 25. - He's just 25. - How old is he? - So, he's 29. We've known each other for over three years. - Man. - He danced around at different jobs, mostly part time. And then-- - And you think you can change him? 'Cause that's what this is boiling down to, right? You think that if you have enough conversations with him after three years, you can change him to being more like you. - Not even more like, maybe more like me. I don't know. I always ask him, "Do you want a future?" And he's like, "Well, we don't know what we're doing in the future, so we don't need to support him." - Yeah, he's told you, Sophie. He's told you. - I guess that-- - If he hadn't told you in three years, you're not listening. - Sophie, it's very interesting, 'cause to me, I'm like, "Man, I bet he's like a really fun friend, "but to have a life partner like that." With the numbers you gave us and how solid you are, I'm kind of shocked, he's still around. - I mean, I think that he's hoping that we stay together and then I can kind of-- - I bet he, I bet it is. - What are you hoping? - He's got girlfriend making six figures. I mean, heck yeah, you're a catch. - I know, I'm just, thank you. I just hope that one day he just wakes up, but-- - How many years, okay, let's play this game, because you're 25, you ain't getting any younger, and you've been in this for three years with this guy. What, we have to set boundaries and respect your time and his time, so let's just say in your perfect world, or in a fair world, how much time do you think that you would give this to either see some sort of forward movement, or not? Is it a six month, like in six months, if he's still talking the same talk and walking the same walk, I gotta walk. Or is it, I'm accepting him for who he is and I'm just moving past this and that's that on that, or I'm letting the relationship go. - I'm tempted to accept him for who he is, but a year ago when he didn't have a job, I gave him six months to get one and then he got one, but he hasn't saved the penny. - But don't you feel like you're mothering him? If you don't. - If you don't get a job, if you don't get up, if you don't do your laundry. - So, here's the harsh reality. It is, I bet he's not a bad guy. I think he's lazy and he's a little bit in the clowns with all of his theories about life. That's not reality, but what the biggest problem is your value systems do not line up. So, if you're gonna be, if you go forward with this, what marriage is gonna look like in five years is you're gonna probably be the breadwinner. He's gonna probably have a level of resentment at any level of, 'cause you're probably the top one person. If you have $220,000 invested, you are the rich person he's talking about. From a numbers perspective, when you look at the average around the country. - Maybe he's full. - Maybe he's what? - Maybe he thinks I'm the evil one. - Yeah, I, maybe, I don't remember. - If you're not today, you will be. - But it's, yeah, and then, I mean, and so if you're your entire, your entire relationship will be in uphill battle. And it's not because, and I'm not honing in on just specifically the money piece. It's the way at which you view the world is very different than him. And the big, and the grown-up things of life. Okay, yes, y'all can enjoy the outdoors and like mountain bike together. But when you're actually looking at life, and you look at Sophie at 35, 40 years old, like we're, we're Jaden Eier sitting. With kids and a life, I am telling you, you want a partner who's running beside you, supporting you, encouraging you, you're doing the same to them. There's a level of safety, a level of unity. We are running this race together. Our household is built on a set of values that we agree upon, and that we are running this race, locked arm, hands in hand, and taking on life together. This guy sounds like you're gonna wake up every day and have to remind him, where's toothbrushes? - Yeah, that's pretty much how it is. - Sophie, Sophie, girl, fly to Nashville, come hang out with me and Jaden. - Please. - And take a break from it. - You got to take you for a margarita and we will. - You got to be done, girl. There's other great guys right now. - Yeah, I thought you'd say. - Because don't you think, what do your parents say? Not that they get a vote, but what do they say? - He left, he wasn't around for a while, and they were pretty happy, and they were like nice kids, but once you're gonna wake up and then he can come around and they're like, oh no. - Yep, I would say follow some wisdom from people. And again, still be front, I mean, poor guy. Still, you can be kind to him, but is he gonna be a lifelong partner for you, Sophie? - He's not my pick for my daughter, that's for sure. (laughing) (upbeat music) - Hey, this is Dr. John Deloney. I take my sleep seriously, because better sleep means better health. And if you've been losing sleep or waking up sore because you've got some old, thin, gross mattress that wasn't designed with you in mind, it's time to make a change. I love Helix mattresses. They make mattresses for real individual people. Whether you're a side sleeper, a back sleeper, whether you sleep hot, or if you and your partner have completely different sleep styles, Helix has a mattress designed just for you. I want you to get online and take the Helix sleep quiz. It takes like two minutes, and they're gonna match you with a perfect mattress that fits how you actually sleep. Helix is not just a show sponsor for me. I sleep on a Helix mattress. Helix mattresses are the best. The best savings of the season are happening right now on Helix mattresses. Go to helixsleep.com/ramsy for their best of the web, offering get 27% off site wide. That's 27% off site wide at helixsleep.com/ramsy. That's helix, H-E-L-I-X sleep.com/ramsy. With helix, better sleep starts right now. (upbeat music) - Welcome back to the Ramsey Show in the Fairwinds Credit Union Studio. I am Rachel Cruz here with Jade Warshaw, and we are answering your questions. We have Alicia on the line, and she is in Buffalo, New York. Hi, welcome to the show. - Hi, thanks for having me. So my question's on 30. I have to taxes. I make 72,000. And I am just a pretty big set number one. So I'm starting to pay off my debts. And I did my snowball a couple days ago. And one of the collections I made that has went to court recently and still being like gone through the process before they served me. And I'm just wondering if that's my highest collection. Like it's like my last one of my snowball. Should I be prioritized and move that up? So I can clear that issue out of the way or just wait for it to roll through the motions and just see what court does. - How much is it? $3,692. - Oh, do you have any money? Like do you have a thousand bucks saved? - That's in my baby fund, yeah. - Yeah, in your baby fund, okay, okay. 'Cause I'm wondering since it's all the way in collections and they're, you know, at the point of suing you, if you can settle with them, but you would need some money to put up for it to say, hey, I have this amount. I'm wondering how could I. Go ahead. - I make, so my minimum month needs to do like on my debt now. I make around 1,800 a month on those. And then my monthly bill that I pay is $2,500. So collectively, I have to pay out $3,300, but I make about $6,000 a month, okay. So I could put save up that access to 700 and like you move that to a very top, but I need at least, I feel like I need like 50% to offer them. And I don't know if I should just, like I could pay off eight accounts within that $5, $21 or $100 of my between pay rateers and my small collections and my small credit cards that I didn't close. - Yeah. - But I'm like, it's like like, I'm in between a rock and a hard place. - So you can't cover the minimum, you wouldn't have the money to cover the minimums while you stack up. 'Cause I don't think you need to save 50%. I think if you get to a quarter of this, they might take it like 25 cents on the dollar. - So that would be that calculation would be, if it's $9,000, let's look for seven to 900 bucks. - Yeah. So that's about, that's like six weeks of, it's not paying my, that's not, it's just six weeks of not doing a snowball. - Well, you're doing a minimum to begin with. - It's not that you're not doing the snowball because you can pay the minimum, so you can pay the minimums on everything. We're just expediting this 'cause they're taking, they're suing you. And so let's make sure, if it hasn't happened yet, let's try to go to the table one more time and say before this makes it to court, can we just settle this is all the money I have? And consider it, you're just paying up loose ends. - Yeah, you're still doing, 'cause you're still paying off debts. You're going the right direction. - Yeah, you're just kind of reordering it because of your situation. We would say the same is true if you had an IRS debt, we'd say move that to the front, even if you're like, oh my gosh, but by the time I pay off half of that, I could have four other debts paid off, right? It's just you're reordering it because of what is happening and because it's stuck in collections. But you sound motivated. - Yes. - I do, I'm, I, I got, I live in my boys, and he's very fortunate that he makes very good money for what he does and he pays utilities and rent, like he pays him a dollar a mortgage and he pays utilities and food costs. So I looked at my, I pulled up credit reports a few weeks ago and it made me sick. Like I don't understand how I'm, I just turned 30 this month. I'm like, I don't understand how I'm 30 with three degrees and consumed that with my car. I owed $41,000. - Yeah. - Oh wow, yeah. - Tell us about your car. - So 18, two months ago, I, two years ago my old car, which is almost paid off, got told old and I, I, you're not in a credit situation to get a good interest that I had on my previous car. So my car currently is sitting at 18% interest. Oh, and it's about 500 bucks a month and like once I know, like I, I, and what do you owe to me? - 41,000. - 41,000? - I don't know. 41 is collective all continued. - Oh, okay. - Oh, I'm sorry. - What's the car? - I owe 17. - Oh, okay. Okay. That's what I'm good Lord. I was about to say, at least you put that car up for sale. - Yeah. - What's the work? - What is it worth? I'm just curious. - About a nine. - Nine. - Private sale? - And yeah, private sale. - Okay. - We've got $9,000. - Okay. - And with my snowball with my, what I make right now and that's like, I have my main job. I do, I, I'm a bookie before a law firm. So when I, if I do, I've got a court for this case. - You know what you're doing. - That's my lawyer. My lawyer's already like, we'll cover you. Don't worry about it. And then I do in the couch on the side too. And like, you know what? I'm completely able to do everything I need to do. Pay them for the month and get out of this. That is 15 months. - Good. - Yes, Carl. - So. - We love it. That's what we love to hear. - Yes. - Well, it's just the idea of you are finally sick and tired of it. And when you open up that credit report, she's like, oh my gosh, what am I doing? And so she's rewiring everything that she had been doing and making great progress. So well done. All right, let's go to Sarah in Denver, Colorado. Hi Sarah, welcome to the show. - Hi, thank you for having me. - Yes, how can we help today? - So I was hoping that you guys could maybe settle a debate between me and my mom. I guess for a little bit of background, I'm 19, and I'm a sophomore in college, I'm currently taking my prerequisites and next fall I'll be attending nursing school. But for my freshman year of college, I wanted to go to an out-of-state university and that was before I realized really how much I would be paying in student loan debt. Yeah, so I ended up transferring back to a local college where I'm paying around 6,000 a year. But I still ended up racking up around $26,658 in student loan debt. Okay. And 22,000 of that is at parent plus loan and then the remaining 4,000 is my personal loan. Okay. So I guess my question would be I feel like I should maybe differ from nursing school for a year and work full time to pay off that debt. But my mom thinks that by the time I graduate nursing school, I should be making enough to just pay it off fully. The 4,000 or the 22,000? The 22,000. Is it subsidized or is it unsubsidized? It's unsubsidized. You, okay. Are you able to cash flow college? No, not necessarily. No, I'm not letting you know take the time off. Will you be taking more loans out then to go to nursing school? Yeah. Okay. So yeah, I would say pause. And I may tell you right now, depending on, and I'd want you to see how long you're in nursing school. And is it 6,000 a year as well? Oh, yeah, it should be. Okay. I would make it a priority to get through that because I am with your mom. If you get that degree, you're going to make great money, Sarah. And nursing is one of the best fields to work in. So it's fantastic. But I think I would maybe pause, and maybe not as much to pay off this debt, but to make that to put away enough to get through nursing school, debt free, and then when you're out, maybe attacking that. I'm just thinking age, age, age, what I would do. Because to get a good career going under your belt, I think is a great step. But I don't want you going deeper in debt. I would not encourage you at all to go to school if you don't have the money for it. So you need the money going forward. And if you can cast your way through school, once you're out of school, then look backwards and say, okay, let's knock out this debt. If you're behind on your bills, doing more of the same isn't going to fix it. You need a different plan. And that's why I tell people about guardian litigation group. If you've missed payments, if collectors are calling non-stop, or if you're getting letters about legal action, that's your signal. And it's where a lot of people wait too long because the longer you wait, the fewer options you usually have. And once it turns into a lawsuit, things can get more expensive and more complicated fast. Guardian litigation is a law firm, not a call center. From day one, you are assigned an attorney who represents you. So if a creditor moves forward, you're not caught off guard and you're not hit with surprised legal fees. Guardian litigation only gets paid when the debt is negotiated and the client accepts the settlement offer. This is about stepping in early while you still have leverage. Don't ignore the problem. Take control of it. Go to guardianlit.com/ramsy right now. That's guardianlit.com/ramsy. It's any advertising. Results may vary in no specific outcomes guaranteed. We wish we could get to every question, every call in the show, but we cannot. But if you have a money question, make sure to head over to our website and use Ask Ramsey. So Ask Ramsey is our free AI tool. And it's built all on Ramsey principles. So when they built this tool here at Ramsey Solutions, everything that was fed into this specific AI was all Ramsey. It's calls from the show. It's articles on our website. So much content was put in there. So really any question you ask, you're going to get exactly what we would say here on the show. So make sure to check it out. You can ask your question today at ramseysolutions.com or click the link in the description if you're listening on podcast or YouTube. All right, let's go to Dallas, Texas. We have Patrick on the line. Welcome. Hey, everybody. Thanks for having me on. So my question is this. I know the small reason company here in Dallas. And I have such an up and down income one month I may bring in eight to $12,000 and then not bring in anything for the next month or two. So my question is, how do I before the baby sets with having such an up and down income? I can't count on anything month to month to month. What causes it to fluctuate in such a high regard? Well, our main business times for roofing are in the spring and can be fall. And so it's just a matter of months. Yeah, yeah, just getting jobs in. Okay, so I like to say that I'm one of the smaller guys here in the area, not great big giant. So I don't have a huge health force out there generating leads either. So when you if you're between eight to 12, what I would start with is what do I need? Like what does it take my budget to operate? So let's pretend it's $4,000 or six, let's say 6,000, what I'd be doing is on the months that I make more than 6,000, I'd be putting a little extra side in like a peaks and valleys account so that if I have a month where I don't make any, I can pour I make less I can pull from that and kind of keep myself floated. But I'm caveatting that by saying if you know that there is a time of year that we just don't do business, I'd really be interested in finding what I can do to supplement those months because I it never feels good to have a month where you make zero. And I would love for that to be your goal. Like even if I have this peaks and valleys account, even if I haven't said it for two months, what else could I be doing? What else can I do? Right. Well, the ultimate goal is to get, you know, an emergency fund of, you know, roughly 36, 48,000, just sitting there to buy me over in the salt times, but it's not enough jobs and the thing is though, I wouldn't want you to feel that way because this is not an emergency. This is something that you foresee coming. Yes, you know what's happening. It's just part of your month to month and we can plan for that. But if you're thinking about I need 48, you know, or however much money there for three to three months of zero dollars, that's the part where Rachel and I are saying that we can fix that with work. We don't need to have three months of zero income coming in fair enough. Right. Yes. So yeah, having that fund over there is going to be very, very helpful. And then beyond that, just saying, okay, you know, if I need $6,000 to operate and I'm making eights, let's put some money in that peaks and valleys fund. Let's put some towards an, a true emergency fund of three to six months of expenses because you have any consumer debt Patrick. Yes, Emma, I've got about $30,000 in credit card debt and unfortunately, that's kind of what I'm using to tighten over in these in these forward times. Oh, God show. Okay. So yeah, so more than ever, and it may be you over committing yourself with work and extra work just to get your head above water so that you can not only pay your bills for the winter months when, you know, that that's coming, but also to start working your way out of this debt. So for you on the slow months, because on the good months, if you're making 10 grand, yeah, you're able to shuffle that around and use that. But when you're not making anything, something has to be coming in, so that you don't go deeper in this credit card debt. So that'd be my first goal. Get your head above water. And it's probably going to be mean working, working a second job in those, on those slow months. Yeah. All right. Let's go to Hannah and Atlanta. Georgia. Hi, Hannah. Welcome to the show. Hi, how are you? How can we help? I my husband and I just started taking FPU at our church and we're currently in baby step two. And we are debating on taking our money out of our CD that we have and paying off all of our debt. I think we should and my husband doesn't. He thinks if we do that, it'll just be saving us and we won't learn any lessons, almost like he wants us to suffer a little bit. So I just want to hear a opinion. How much is in the CD? A little over 52,000. And that's more than enough to cover all of your debt. It would pay all of it minus around 2,000. And is he saying he wants you guys to feel the pain of paying off the debt? Is that what I'm hearing? Yes, because we have been debt before and we've always kind of synangled our way. out of it easily. And so he thinks if we do it again, we won't learn any life lessons and our habits won't change. What's I kind of agree with? But he's blessing his butt at work to pay for all of our debt. And I don't know, I just kind of need a second opinion. What's the nature of you guys' bad spending habits? Is it credit cards? Is it vacations? Like what's the one or two things that you're like, man, this is, it gets us every time? What is it? credit cards. And is it just lifestyle going out to eat, shopping, stuff for the kids? Is it just life? Yeah, mainly life. Our kids, they're in sports and it's hard to say no to them. We don't eat out often. Well, did you cut up the credit cards? And a lot of things were frugal. We did. We cut every single one of them up. Good. Well, honestly, there'll probably be some pain and just that. Having to say no, you know what I mean? Just, and just having to say no to your, having to work these new habits. So, so I would say I understand his logic. And we always do caution people to say, if you know, if you had a lump sum from like a lawsuit come in or, you know, an inheritance and there are people who throw this amount of money and be debt free, we say to do it. So we never tell you not to. But we do caution people. Okay. But this is not changed your behavior. So hit. So I really appreciate his perspective. Like he's done. And he's like, I want to change. I want to change so bad. I want us to hate our lives for a season. So we never go back. I appreciate that. But also to get you guys to a place, the fastest place to start building wealth. And that is to use this money, stop making payments, stop paying interest, pay it off, get it paid off. And then maybe there's still some sacrifice, Hannah, to get this three to six months of expenses. Say, baby, step three. And you guys, and him work as butt off towards that. Hannah, how many months have you guys had that you set the budget and you stick to what's on the budget? We just started to try to budget for real this time. We've tried in the past and failed. But he's at the point where we're sitting in church and we're watching these videos about the baby steps and he's tearing up. So no months. No, but I'm trying. Yes. Okay. No, we won't fall for that. Yeah. It helps me understand what he's feeling, which is he's basically saying, we haven't proven any of our behavior even with one month's budget. And I think that he's afraid to Rachel's point, what if we do this and we're right back where we started and now we're there without any savings, which is fair. It's fair. But what I would tell him though, Jade, is I think you guys living on a pretty strict budget, Hannah, because you're going to need to do this baby step three soon. If you pay most of the stead off and and you'll still be in a in gazelle mode, right? That intensity that we talk about baby step two, there's, there's still that in baby step three. So I would use the sacrifice that I hate our life. We never want to come back here again, feeling for baby step three through six, right? Use it for that baby step. And then you guys on a budget is going to be a big life change in a good way. So he's going to feel some struggle there. They're going to he's going to feel some struggle with you guys putting up boundaries with the kids. Yes. And you guys putting up your own boundaries with your own spending, having to say no. Like all of that is part of the sacrifice, but him having to work all these extra hours to pay off debt that could be paid off today. I would say let's shift this to the emergency funds because you guys will have some months of sacrifice to get that emergency fund built. So put your efforts there and be debt free tonight if you can. As your business grows, everything becomes more complex. There was a time when Ramsey solutions had too many disconnected systems and not enough visibility across the business. We wasted too much time chasing information instead of making decisions. That's why we got NetSuite. NetSuite brings your financials, inventory, CRM and more together in one place. More than 44,000 businesses run on NetSuite, including Ramsey. And now they're taking the next step with NetSuite next, making it easier to put AI to work across your entire business. NetSuite next helps you make the most of your time, automating routine work like forecasting demand and following up on overdue accounts. With NetSuite next, AI is built into everything you do. So you can ask it questions just like when you're talking to a member of your team. And right now, you can try NetSuite next for free. If your revenue is at least seven figures, go to NetSuite.ai/ramsey. That's NetSuite.ai/ramsey. Our question of the day is brought to you by Why Refi. When private student loan payments start getting away from you, it can feel like you are paying for decisions you made years ago. Why Refi helps borrowers explore low, fix straight refinancing options and payments designed around your current situation. Visit whyrefi.com/ramsey may not be available in all states. Already today's question comes from Felix in South Carolina. He says, "Why do you recommend working with a financial advisor to invest, which incurs a fee over learning to invest on my own, which avoids the fee?" I actually really love this question and I think it just speaks to the individual. There's plenty of you out there who the only vehicle that you're using to invest in is through your 401(k) at work. And there's just a few options to choose from. And if you listen to us and you go, "Okay, I know there's the four types of funds that they suggest growth, growth in income, aggressive growth in international, I was able to identify one of each. I selected one and the rates of return have been good." Cool, said it and forget it. Most of us don't need a financial investor if all you're doing is investing through your 401(k), which is fabulous. But then for folks who are like, "Oh gosh, I'm venturing out. I have a little bit more money to spend. I am now going into a Roth IRA and there's so much to choose from." And I'm feeling a little intimidated. This is my first go round and you do want somebody who's in your corner, then yes, a smart investor pro is for you. Maybe you're a person who you're like, "Hey, I maxed out my 401(k), I've done some Roth IRAs and I just don't know where to go next." Or I'm thinking about retiring early. What does that look like? Just kind of getting into some more advanced topics. It is helpful to have somebody to help you navigate that. And if you feel like you've got it and you're looking at things and they feel like they're going well, then it's not for you today. But if you need the heart of a teacher and you want somebody to kind of help you along, then we've also got you covered there. So Felix, if you feel like you can select those four funds, if you're looking at them and they're averaging what we're saying on here or you're checking the S&P 500 and you're seeing, "Okay, I'm at least meeting that index or doing a little better." That's fabulous. Keep doing what you're doing. Yep. And I would say, too, a great financial planner. You guys look at more than just your investments. They're looking at your entire financial picture down to taxes, estate planning, even a way through your giving, certain funds that you can do to an interest that's made, you don't have to pay taxes there. I mean, they really can look at your whole picture and be the most efficient with your money. That's why I love ours. We have ours that we meet with every January. And he still teaches me new things, things that change in the market, you know, whether there's regulatory, regulatory, that's a good word. Yeah, just made that one up. Regulatory is. Yes, that official. Yes, that change in the market and the laws and the amount. Yes. And all of it, it's an ever-changing industry. And so having someone that this is their life and that a lot of them can find funds that beat the S&P 500, you know, some good mutual funds. It's just having someone in your corner. So I'm with Jade. If you're beyond just your 401k at work, find someone that's going to look at your whole picture because they are so, so helpful. What am I trying to say? Regulations, I think, with regulation change? Regulations change. Tax regulations. I don't know. Regulatory. I was putting it in the dictionary. I was putting my face next to it. Oh my gosh. We're I was with some of our content team today and one of them was laughing because you couldn't spell this word right and she's like, the robots are going to get me first. And I told her, I was like, I feel that way. Do sometimes. They're going to see me and be like, take her out. She's done. All right. Let's go to Timothy and Idaho. Hi, Timothy. Welcome to the show. Hey guys. How are you guys? How can we help? Wait, I could use your wisdom in how to start saving up for a care, a caretaker for our son and in particular with how we can do that in between. Baby steps four, five, and six. My wife and I make a baseline of 110,000 and our oldest son has some mental disabilities. He's seven years old right now and he is most likely when he turns 18 or 21, going to need a full caretaker. He will not be able to be on his own. What we're trying to figure out, and we talked with the Smart Buster Pro, we're trying to set aside some money that will grow over time so that we can afford paying somebody to help our son as he becomes an adult because our our heart is that our son is able to have a little bit of his own independent and be his own person as as best as he can. However, it feels kind of impossible with the numbers that the Smart Buster Pro gave us like he was saying that in order to reach critical mass, we would have to be setting aside 12,000 to 20,000 dollars per year until he turns 21 in order for a caretaker to be able to make this happen. What what does it can you tell us the numbers of what it would cost to have somebody doing that type of care once he turns 18? Like what's what's it a month? What's it a year? Right now like 80 to 100,000. Okay, yeah, and I think the goal probably with the Smart Buster's thinking is this is probably going to be a lifelong fund for him. And so you're wanting to use the growth off of the principle. It's almost like a retirement, right? The way you look at retirement, I'm going to just live off of the growth and not touch the principle so that it stays there forever. And I can keep keep this going, right? So so yeah, the numbers he ran a thousand bucks a month. Yeah, probably probably is accurate. I don't know. But I see how that feels like a massive uphill battle. So what and you may not have to do a thousand dollars a month right now, you know, maybe it looks like in three years where you guys are, you're able to put an extra 1500 and kind of catch up to that full amount that you're shooting for for when he's 21. But also I wonder to Timothy, if if you're not quite there yet, if it's maybe a goal when he's 25, because I think eventually having that fund is going to be really, really important, but I hear you where it feels like such a a long timeline with a lot of money in order to get that. Well, I'm also wondering and I'm not an expert in special needs care. Let me start by saying that. But when he turns 18, if not 21, won't he won't he be eligible for some form of F of SSI, like some sort of supplemental money coming in every month from the government? He, he probably will. The reason why we are hesitating with that is we don't know what that would hold as far as what the government is able to provide. They can change the world whenever they want. So what we are trying to do is just kind of use that as icing on the cake and become fully self-sufficient. I would look into that a little. I would look into that a little further because long-term planning you are going to want this through a special needs trust so that what you have what you do have set aside for him doesn't have the ability to be revoked because it's under his name and it's not protected in that way. Do you see what I'm saying? So I would sit down with an attorney that can help you specifically with that and do the special needs trust so that you're deciding once he's 18, how is this money protected so that it doesn't take away from his ability to receive SSI in other ways? Does that make sense? Especially if you're thinking, hey, he's going to be out there on his own. The other idea that I had for you is obviously you guys are taking care of him now. Is there a way that you can prolong that longer so that you can continue to set aside money? And do you see what I'm saying? Can you kind of split the difference on that and say, well, maybe he'll live with us until he's 25 so that we can keep some of that money and keep stacking up this trust and these funds for him? Yeah, we can definitely do that. The challenge is that it is kind of a lot of work so I just want to be careful of my wife and maybe you hire some supplemental care but you're still allowing for the margin for you to continue to set aside because you're right, you do have to look long term for that and so I think as you get closer and if you sit down with somebody to help you plan it, they'll help you decide exactly what you need to do and how to play this out. Here's something that keeps a lot of parents up at night. Kids are growing up with more access to information than ever before in history but most of the content is calculated to keep them distracted, make them mad and keep them scrolling, not help them think for themselves. Worldwatch exists to be the antidote to the algorithms. Worldwatch is a video new service built specifically for preteens and teens. They're daily 10 minute videos that explain what's happening in the world through a factual Christian worldview. No outrage, no noise, just clear reporting you can watch together and that your kids can actually understand so they can come to the dinner table engaged and curious instead of worked up or zoned out and I love that Worldwatch doesn't talk at kids. It gives family something to talk about because when my kids are older I want them to be able to think for themselves and separate news from noise and right now you can try Worldwatch free for 30 days. Click the link in the description or go to worldwatch.news/ramsey and use promo code Ramsey to get started. The Ramsey offer includes your first full month free on top of the standard 7-day trial. That's worldwatch.news/ramsey. Up next we have Angela in Toronto. Hi Angela, welcome to the show. Hi thanks for having me on. I'm on baby step four and I'm hoping to get some advice as to whether I should go put myself on a mortgage with my boyfriend of five years. Okay so you guys are looking to buy a house. He's actually already purchased one and it's more of a retirement property. He retires next year but I still have five years to retire. Okay and you want to put your name on the mortgage with him? I was thinking about it and I'm not so sure just given our spending habits and situational factors. What would be the purpose of putting you on the mortgage? What's there to gain for you? I would eventually be moving in there when I retire but that wouldn't be for a few years. Right but where you live right now. So let's just pretend what if you just, if you're like yeah I'm going to move in there what if you just paid your portion of rent? Why would you feel like you have to be on the mortgage? Did you put money down with him? I did not. I have a feeling that he doesn't qualify them for the mortgage without me. But I thought you said he already got it. He's saying he's got a, he's selling his house and he's bought this property and it's a mortgage of an additional $550,000 and he's given the bank my numbers as well. Oh, wait a second. Isn't it weird that he's buying a property without you? Like he's picking it, he's choosing it. It's his retirement but now you have to, he's putting your numbers with it. Are you getting a say in this thing? Yeah and so that's part of the reason I have called because my spidey senses are saying something is off here. Me too. Good. Good. In together five years and we did have goals of retiring and purchasing a property and he's returning next year so he's decided that he found the perfect property and we had looked at some and it was all, you know, he did this all so fast and all of a sudden there's. Yeah, there's a, there's a lot wrong with the situation. Angela, one is you never buy a home with someone you're not married to. You have no legal protection. Your name is going to be on this loan with someone that you again, legally you're not married to it. It ends up being a mess. Okay. If something were to happen. Yeah. What if he doesn't pay? It's a mess. Okay. So do not buy a home with someone you're not married to. That's to you and to every person listening right now. Do not buy a home with someone you are not married to. Number two, Angela, he can't afford this home. a bank will not give him this loan without you, which means the bank who gives loans for a living, this is what they do, they want everybody in debt, 'cause they make so much money, they want to give debt out. Even the bank is saying, oh, if the debt maker is saying, I don't wanna give this debt, we need someone else, that means they don't trust that he's gonna pay it, that he has the ability to pay it, okay? And think about that, just for a split second, Angela, if you go on this mortgage with him and month one he doesn't pay, and month two he doesn't pay, and month three he doesn't pay, you're on the hook for that. - Right, right, and I already have my own home. - Yeah, you don't need that money, exactly. You do not need a second home. If he would like to go retire, he needs to buy a home that he can afford. He can afford the payment, and so he needs to do that in an individual sense without you, and then however you're living arrangements are, they are what they are, but there is something about tying your financial life to someone that is so scary, and I mean, how old are you? - I'm 54, like we're really happy with my whole life. - So, Angela, you're toward the end, you're about to finish, you see the finish line, and what this is gonna do is this is gonna take you off course, and you're gonna be stuck in the woods trying to find your way out when you were on the path, you know what I mean, you saw the finish line, and you deviated from it, don't do it. This is a big half a million dollar deal. - It's a big deal. - And Angela, you're 54 years old. You know it, you know when something doesn't feel right, and this is it, you're like, man, you're calling us, which is a really good indicator that this doesn't sit right with you, and it doesn't sit right with me either. I agree with Rachel 100%. I would tell him, I'd sit down on you guys's next date, and I'd say, you know what, I've been thinking this over, and I want you to have the retirement home that you want, but you wanna know what, it's something you've worked for, we're not married, and I think you should do it, but I'm not gonna put my name on it, and we can, you know, in the next few years, if we start to think about maybe me moving in with you, I would just like to pay a rent, or something like that, we'll figure that out, but my name doesn't need to be on the deed. - Yeah, how much does he-- - Let's see how that goes. - Yes, that's a great point. See what his reaction is. - Do you know what he has in retirement? - She has a government pension, but he doesn't have any other savings. - Okay. - So, I know he would bring home around $4,500 a month, but with, you know, to take on a $500, - No, he can't afford it. - And $4,000 mortgage, $600,000, we hold the additional things he wants to do. I just-- - Yeah, I don't have the money for it. - And then I think it might be me being-- - Exactly. - How much do you have in retirement? - I also have a government pension, and I've saved about $200,000. And so, when I retire at 59, I will be bringing home $62,000 from my pension a year. - Good for you, okay. - And then I have the equity in my home, and I have a couple hundred thousand dollars in savings and investment. - Yeah, 'cause those will be, that'll probably all be close to around $400,000 by the time it's all said and done. - Yeah, and I just, I know that this is a life-changing decision, and I've worked so hard. I just thought, am I crazy? Because when I speak to him, he makes it sound like it's gonna be so easy and wonderful. And yeah, but-- - And you know what, too, it's pretty fun. - And who has credit? - Yeah, I don't wanna believe that he's being malicious. I don't wanna put anything like that. I just don't think he's being smart about it. - It's just not smart. - It's just not wise. For either end, right? Like he can't afford it himself. You don't need to be dragged into it. And so, I don't think it's that he's a bad guy. I just don't think he's great with money. - Yeah, and it's gonna put a stress around your relationship. If you do this, it's just going to. And there's no point of doing it. I go back to the original question I asked, which is what's the benefit? There isn't one. The only benefit is for him getting his loan approved, but that's not what you're his girlfriend for, right? That's not the reason that you're in a relationship to help you get your loans approved. - Yeah. - You know, and it just boils down to that. - I appreciate it. And I respect the show so much that I will take this advice. - Oh, that was so glad, Angela. And honestly, I think you'll be better for it. And the beautiful thing is y'all may look up in three to four years and get married and say, "Hey, let's go retire somewhere together." - Sure. - And live your life together, right? - I mean, that would be the hope. But I think that is what's so hard is, it's become so normalized to combine things even when you're not married. And to the point that you've worked your whole life. And you're later on down the road in a relationship. And so the same is true when you're 20 or when you're 60, but the same mess can occur on a legal sense that when you own property together, it can get so tangled. And any co-signing, this is even with cars. And we get this call of the time that while I co-sign for my ex-girlfriend and now she's dating some other guy and another state won't pay the cars and all that stuff. I mean, it's just, it can stay with you. And it always ends up more harm than good. - Yeah, and I agree. This guy, he's probably not a bad guy. It's just sometimes when you want what you want and you get a little desperate. You start to take desperate measures. And in this case, you unfortunately start taking advantage of a relationship in order to get it. - Yes. - And I think that's the tough part is like, don't do it. It's not that serious. - Nope, not at all. But trust your gut too, Angela. I think that that's another good lesson for everyone, right? If you're in the financial decision making process and you're like, this just doesn't sit right, that is that lack of peace. Listen to that 'cause we are trying to solve for peace as Dr. John DeLoney says. (upbeat music) - Let me tell you what I get asked all the time. When should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking. So let's take a quick review. The fact is, term life isn't a baby step. So if anyone is dependent on your income, you need to have 10 to 12 times your income in life insurance. Now and most people are surprised by how affordable term life really is. Even if you're not in perfect health. Look, I understand the hesitation since most insurance companies make it more of a hassle than it needs to be. Not as standard insurance. They're not an insurance company. They're a broker that works for you. That means they'll shop and compare the top term life companies to find the most competitive options on the coverage for your family. For almost 30 years, I've recommended Xander for straight answers, competitive rates, and coverage that actually protects your family. Call 800-356-4282 or go to Xander.com for a quick and easy quote. That's Xander.com. I am Rachel Cruz hosting this hour with Jade Worshaw. And we're answering your questions. So give us a call at AAA825-225. All right, we got Andrew on the line and four Myers. Hi, Andrew. Welcome to the show. - Hi, thank you so much. And I really appreciate everything that you do for everyone. So. - Oh, thank you. I appreciate that. - Yeah. My question is, I'm not exactly sure how to build a life with my woman, my girlfriend, I guess. We have an eight-year-old. - Oh, okay. - And I've been here for over 10 years. - Oh, okay. - Yeah, and so the hurdle that keeps coming up is that she was a widow in her 20s. And her son, she had a son in his 21 now. But she had survivors benefits when he was a teenager. Her growing up is either the kid in through his teenage years. And then now she doesn't, so she would receive her, her deceased husband's social security. - Right. - And she becomes of age. And I guess that's a pretty large number because he made, you know, sizable, like a lot of money every year. So, so not, so I don't understand how to plan all of this. If, like, she doesn't want to get married until she's 60 years old, because she doesn't want to risk that benefit going away is basically how it is. - She, she, she was in some social security over. - Oh, for, I mean, how much could it possibly be? Did, has she told you the amount? - 3600 to 4 grand a month. - Stop it. - She, yeah, I mean, I just don't understand. - As soon as she said 400,000 a month, I'd be like, "Anger, you may not be worth that." I don't know, but 4,000, does she work? - I get it. - Does she work? - She does work now, yes, she works. - I don't want to, she earned. - She earns like 43,000 a year after taxes. - What do you earn? - I earn 150,000 after taxes. - So wait a second. We can go and Andrew can put a ring on it and she can, you guys combined can be making $193,000 a year and she's foregoing that life for, >> Survivors been it fits that we don't really know, but maybe they're around 35 to 4,000 bucks or combined finances and she's getting both and she's like I just don't want to get married because I get to live off this 150 now. So what's the point? >> Yeah, I don't know if it's some kind of trauma for when she was a single widow mom and she got the she didn't know about survivor's benefits until her a relative who was a police officer mentioned hey you can receive survivors benefits in the 28 years old you got a baby. So she looked into it and she got a check every single month until he was 16 years old. I think you're right. >> Yeah, she you know she got it in her in her mind that I'm not going to do this until I'm this age and then we got together I mean we're what I'm having a really hard time planning. >> No you can't plan that she had some debt. I want we want to buy property. But how am I going to I don't think you can't Andrew this is a I think you're exactly right I think this is tied to something traumatic. I mean obviously she was widowed so young and then she was left in a really tough situation with this child and who knows there might even be something that goes further back. I don't know how she grew up how money was but there's clearly because it makes safety it's safety yeah yeah and it feels like I'm going to be okay regardless of what happens for this $4,000 a month. >> I also feel like there's you know this sense of impermanence you know that that happened and now that like planning future things like yeah sure planning saving you know she's just it's so well impermanent I guess she probably and you've been like this for five years right. >> We've been together 10 years okay so why why now I'm just curious what now is happening in side of you that's like Ali this is getting hard is it because you're getting your finances in order and you're realizing gosh I have yeah a life with this woman but but really it's so hard to do it I have a hard time communicating with her now yeah yeah and you've been in a cycle and a pattern for 10 years of breaking that marriage or not in a relationship is tough so I mean I really I would see it should be open to sitting down with someone and you both talk through this because if you're not a great communicator in a sense of like you you're not able to find the words that you're wanting to say and say you know to have a third party kind of walk through some of this and and honestly a professional probably be able to pinpoint a couple of things because my goal would be for her to heal right on an emotional standpoint so that something like this isn't seen as a barrier yeah but you're able to move forward with your life I want that for her it's almost like she's still holding on to this part and I yeah I would she would she if you suggested that if you said you want to know I I just think that there's some healing still to be done and I love you and I want this for you and I feel like it's for us to hold this back a little bit how would she react to that oh I think that should be open to it yeah I've been doing therapy that she's on EMDR working a couple yeah one of couples therapy right now you know it's just strength in our relationship but it's hard to bring it up and you know I'm the numbers guy she's a little more free spirited so when I start coming at her with you know like I don't even see her bank account I don't even see her statements I don't ask I don't know exactly where money goes but you know it seems to not last very long but I don't I don't know exactly where it goes so I can't say yeah on her end but it's hard to talk about yeah and then I'm walking around you know we're posing as a married couple you know I call it my wife but technically you know like as far as you know under God were together but I feel like I'm not walking under his umbrella because we're not married you know like we're you know and then we're not gonna get married for another like 16 years yeah I'm Ian you know she's 48 so I guess it'd be 12 years but yeah that's a lot of time and I plan together Andrew have you guys brought up money the subject of money with your therapist I don't know okay what the last conversation about money was but with there was like financial people with her school system so she invited me into that conversation for us to like plan together and I just got real Ramon and they like it okay so she's probably like Andrew fall in this crazy this crazy program no well here's the thing Andrew and I know you know this but just to reiterate that money represents more in all of this than just the money right so when we talk about people combining finances yes is there a tactical when you're married is there a tactical benefit to it absolutely you're functioning on a one account but it's all about what money represents and there's a level of unity there that is not or that is not there because she's holding out for this thing over here that's money related yeah and over here you know she she's not letting you in you don't know how to communicate well with it and so there's almost this value system that's been broken down in your relationship and my prayer would be that you guys you know once maybe she she sees it and she's like oh my gosh I I want all of me with this guy because we have a kid together right at this point and we want to start building this life it's not the fact that like oh gosh you can't come by money and you can't buy proper together like all that is very true but it's it's underneath what it's representing she's holding a part of her away from you so it's almost like you fully don't get off of her and so that's what I would work for we'll work with the therapist with because it's a this is a tough subject for people and so if you have that third party in the room I would use that to my benefit for sure because you guys have created a life together so she's almost living in the solution to I mean it's happening yeah they'll know their whole life is having to generate around her pain and her trauma hey guys Dave Ramsey here every day on the show we help people work through real money problems and figure out what to do next now you can get that same kind of help anytime with ask Ramsey ask your money question and get answers built on Ramsey principles we use on the show whether you're making a decision or just want something explained ask Ramsey is here to help it's fast simple and free to use go to Ramsey Solutions.com and try ask Ramsey today that's Ramsey Solutions.com well Rachel you know what time it is time to talk about taxes oh matter fact did you file your extension on your 25 2025 taxes if you did then you know that the October 15th deadline is coming around the corner and the good news is you do have a couple of options in order to get it handled first off if your taxes are pretty straightforward then Ramsey Smart Tax makes filing a affordable and simple right plus there's built-in support if you get stuck and you need a little bit of help but if your taxes are a little bit more complex maybe it's a little more overwhelming or complicated then you'll need a tax pro to help you make a plan because nobody wants to face the IRS without backup so which should you choose you can take our tax quiz and find out really quickly then you can handle your tax extension like a pro and beat the deadline so take the tax quiz today at Ramsey Solutions.com/taxquiz all right go to Lisa in Houston Texas hi Lisa welcome to the show hi what were you doing can you hear me okay yes we can hear you yes thanks for calling in very good you're welcome I am in trouble here I basically am a widow about 58 year old widow and I basically was drowning in debt once my husband passed and I realized I wasn't getting any any income from his who was a doctor he was a professor at UCLA and taught for over 55 years at that college oh wow medical students anyways long story short I'm basically calling in to find out how to get out of a debt resolution companies contract that I went online in a desperation to sign to help me try to stop all of these creditors from coming after us because my husband and I lit it off cards credit cards because he never carried cash on him and so we lived off credit cards and a lot of those credit cards you know had my name on them because I was his wife and anyhow bottom line is I'm looking through everything in what I had previously spoke to your associate with before I got on the air with you guys was that I had remembered signing my you know typing in my name on the computer to sign contracts but I saw that was like seven pages okay I can contract on my phone that was electronically sent to me and then I made a phone call yesterday and to this company and ask and do send me a copy of my contract that I signed okay And it's a 35-page contract. Now, it went from like not even 10 pages to 35 pages. And I'm just, I'm concerned because I'm reading. I printed it out while I was waiting for you to speak to you. I printed it out on my computer on my printer. And I'm looking at everything. And I'm seeing my name tied to into these pages of things that I don't even remember reading. Did you already sign it or you just received? Have you already signed it? Well, it's got my name tied. It's just, it's no signature. It's just a tight-in name. I understand, but have you electronically signed it yet? Have you okayed it and said yes? Well, I, yeah, I mean, it was back in, I first signed all these documents with this company in March 15th of 2025. Uh-huh, okay. And March, but you were saying the contract you signed was 10 pages. Yeah, that's where I remember reading. Because I would have never been able to read 35 pages. But did something change beyond the size of the contract? Did something with this, is it a consolidation company? Yeah, it was a company that was going to help me repay my debts by me paying them a certain amount of money. And they were opening an account for me. Yes. And then paying out of an account that I held. That's right. These certain creditors, and they were going to try and try and get these debts reduced dramatically, because, well, not dramatically, but they got some reduction. But then I understand that they're charging me a 25%. Yes, ma'am. So let's try to solve it. Let's try to solve it because you're exactly right what these companies do. They'll take your payment and they'll set up an account. And they're going to pull that money. And in the meantime, they're going to take that time to settle with the other creditors that you owe. That those are all things that we would tell you you can do on your own. And we think you should do it on your own. So if I were in your shoes, Lisa, I would contact them. And I would say, I want to get out of this contract. And there may be some fees associated. There may be some-- what we would call stupid tax, which is just money that you end up paying for realizing there was a better route. And there may be some of that attached to it. But what I'm hearing is that you signed up for a service. You're not getting exactly what you wanted from the service. And it's creating stress and confusion because the contract is this and then it changed. And my name is typed on there electronically. It's not serving you well. So let's go ahead and wash our hands of it and let Rachel and I help you. So how much debt is there still outstanding that has your name on it? Well, that's the curious thing is that I have a dashboard on my cell phone that I can access their own app for this company. And just three days ago, when one of my kind-- one of my-- basically, I had a caregiver during the day. And one of my client's debts is retired now. And he used to be working for an engineering company. And he overheard me talking to a company that I hired-- this company that we're talking about-- on the phone. And he said, you know something? Do you know what they're charging you to do this? Because I found out that he's the one that he was training a lot of people to do Dave Ramsey's program, his financial program, at the church he was with. And he said, yeah, we're going to let it go though. We're going to get out of this. It's seeing how it's stressing you. Because I asked you-- the question I asked you is how much money do you still owe? Oh, OK, I still owe $19,000. But according to their website, when I pulled it up yesterday, it's over $20,000 now. So it's going up instead of down. Yeah, I would first inform us. I hope there's no-- I don't trust these companies. No. And I hope there's no weird fraud or something happening that you signed a 10 page. Well, you just signed a 10 page contract. And unless there were addendums in there or something that you didn't open up fully. And once you got the full contract, it really originally still was 35 pages. I'm just praying that they're not pulling one over on you. You know what I mean? That they've changed the deal and used your name. Not only that. Not only that, but now the first page of this contract doesn't even have the name of the contract that I signed. It has some other name. A different company name? Yes, sir. Yes, ma'am. Yes, ma'am. Well, company-- yeah, and sometimes companies buy other companies. And that may have happened. I feel like there's a lot going on here. But what I would say to your homework is, let's call them today and say, you know what? I'd like to cancel. Tell me what I have to do to cancel. And they're probably going to say whatever, however much money you've paid into this account, there's probably going to be a fee associated. And you're going to take that hit. And I wonder-- I don't know that I'm right, but I wonder if the discrepancy that you're seeing is what they held in the account versus what was actually paid. Maybe you're seeing that they're still holding that money and it hasn't been paid yet. I don't know. But it-- Because some of these companies said they will not pay the debt, and they'll let it go into-- they'll basically make it go into default for them to go in and then negotiate for a lower rate. But it trashes your credit in the process. But that's how a lot of them get a quote unquote deal on the debt. But they just don't pay it. And then it goes into default. And then they go and try and negotiate with these debt companies. That's what a lot of these programs do. Where what Jay was saying just so you know in the future, you could have done that. You could have just not paid, right? And you could have done the negotiations. But what we would tell you is that you are the secret of getting out of debt. It's you. And so by not depending on a company to do it for you because they are, they're going to charge you more. They're going to trash your credit in the process and all of it. So do exactly what Jay said. You need to see how can you get out of this contract. You're probably going to have to pay something. And it's not going to be a fun pill to swallow, but you got to do it. And then you got $19,000 left of debt. And then that's when you do the debt snowball. You say you're going to list your debts out smallest to largest, regardless of the interest rate, pay minimum payments on everything and pay off that smallest debt first. But you guys listen, these companies go after vulnerable people in situations. And someone like Lisa, who was widowed and scared, and they feel like the way out, they are not you guys. You are the way out of your debts. Do not go and forfeit and give all your rights over to these companies. You've heard from me and the Ramsay personalities for years, but nothing beats actually getting together in person. That's why we created the live like no one else crews. For seven days, we're vacationing with you. And 2,500 Ramsay people in the Western Caribbean with live shows, us, new content, us, and more. If you're on baby step four or beyond, come spend the week with us next March. Choose your cabinet at ramsysolutions.com/events or click the link in the show notes. This show has helped you think differently about money, do something that you never thought you could do with money, because you've applied the commonsense principles that we talk about on the show. We want to hear from you. So share your thoughts in the comments, share an episode of this show with a friend, and get the word out. Because if it's helped you, I know we can help other people. All right, let's talk to Grayson in Greenville, South Carolina. Hi, Grayson, welcome to the show. Hey, it's so great to speak with you. Can you hear me okay? Yes, we can. Thanks for calling in. How can we help? Yes, ma'am, so I am 23 years old and married. I work part-time at a cell phone store. And I actually own an electronic reselling business that originally operated kind of as my part-time job. It's grown a lot more since we first started. So my question is whether I should keep the current part-time job I have at the cellular store and push hard to pay off the house first, because we do have a mortgage. Or if we should just go all in full time with the business and leave the part-time job at the cellular store. Wow, so is your electronics resell are you making more there than you are at the cell phone store? Tremendously, yeah, I have the numbers. If you want the numbers, but yeah, it's-- Yeah, so I bring in about $2,800, because I've just moved down to part-time $2,800 at the cell phone store. And last month, we netted $20,000. Oh, my gosh. Dude, what are you waiting for? Yeah. But truly, how long have you-- How long have you been making that kind of money on the resell business? So this month and the last month were the biggest months so far, definitely, for profit. So it was $17,000 this month, so far net. And then last month was $20. The previous month, I think, was like 12 or 13, but it's just grown proportionally since I went part-time. So as I've been able to invest more time, it's increased. And is it just you or do you have any body you're working with? So yeah, so my wife actually, she worked for the same company and she got laid off. So she's actually my kind of behind the scenes person, if you will. So she does, my company does pay her. So we are currently taking in some money from the business. But other than the salary for her, everything is getting invested right now back into the business. And it's kind of just pile up right now to be honest. I mean, are you keeping the cell phone job just for like, I don't know, do they pay your insurance? And benefits attached to it that you're reluctant to let go of or why are you keeping this? It feels like it's draining your time that you could be pouring into this business and growing it more. Yeah. So right now, I will literally work like four or five hours a day and it really is for insurance. The self pay cost is just ridiculous with the plan that we have provided through the company and the benefits are really good. So you know, and it gives a little bit of cushion, a little bit of peace of mind. But right now, I think the reason why I haven't left is because I'm trying to stall for a little bit more time to put a little bit more money back into our emergency fund. Like we have, I think, I think we have like $10,000 or $11,000 in our emergency fund in a retirement is right around 28 or 30, but with what you're making from the, with what you're making from the electronics resell, wouldn't it be fair to say if you took that same amount of time imported into the business, don't you think it would pay for the insurance? Oh, I'm sure it would, I'm sure it would, to be honest with you, yeah. I mean, that's, I mean, that's the type of opportunity cost math you need to do because one thing about your time, what you got is what you got, right? And so you can't afford to be spending your time in a non-fruitful way. And I really do think if you went from 13,000 to 17,000 to 20,000 and all of this is you moving away from that job, you went from being full time to being part time. Now your wife is working on it and all that is generating this income. I think it's fair to say, gosh, if I add back those four hours a week or those four hours a day, whatever it is that you're working, you're going to make back the 2800 that they're paying you plus whatever the benefits are for your insurance. Yes, man. And the thing about it to another thing, slightly off of that, is the mortgage itself. So we have $198,000 owed on that mortgage. And again, we are about to hit a personal target where we can move a large sum of money from the business, because it's not, we have an EIM, but we still haven't gone to escort that the whole other conversation and it kind of warms. But we are about to move a large sum of money over and pay ourselves, quote unquote, to put our emergency fund right where we need it to be. So moving forward, do you think it would be a good idea to start trying to stockpile money and push it towards the mortgage and kind of free up that money? Yeah, I would be, I think so, I think whatever you can pay yourself to accomplish your goals and still grow the business is fair. I think that's what we would all do. That's the purpose of having your business is it's generating income for you and it's generating income that affords a lifestyle you want. And in this case, part of that lifestyle is paying off your debt. So I think that's totally fair. And Grace, and I would say this too, I think if something crop hit the fan and you had to go back and make $2,800 a month somewhere else, you could. It's not like you're leaving a massive career that you're like, oh my gosh, if I step away from this, there's no way I can enter in back. I can't get back in. Right. You could find that job again if you needed to in 12 months, you know? Yeah. It forced came source, but I don't think it will. I think you guys are on an upward trajectory. And if you're looking to source insurance because you're right when you're self-employed, it is expensive. My husband and I went through that. It's tough to go out in the market and just find a plan that supports your family. It is expensive, but check out Health Trust Financial. They'll help you source the right plans. And that's who we suggest here on the Ramsey Show. And if I were in your shoes, that's exactly who I would use. And just know that kind of start to view that as a benefit of doing business. Like, hey, I am my own boss. I get to make the decisions. I get to do my own benefits. I get to pay myself. I get to set my hours. Like, start viewing it as a benefit instead of a negative. That's a sign that you're making money. And that's a really good thing. Well done, Grayson. I was going to Tanner and Nashville, Tennessee. Hi, Tanner. Welcome to the show. Hi. So my wife and I are currently on baby step two. Our payoff date for all of our consumer debt is February of next year. And then we should have our emergency fund completed by May of that year as well. Great. At the moment, we have a five year arm. We know wasn't the best idea, the bank, just in that direction. But it matures in January of 2030. Our current mortgage debt is 388,000 at 6.99% interest. And the monthly payment on that is 2631. You want to switch to a 15 year fixed rate after the arm matures in 2030. And we would like to go into the new mortgage with as little left on the house as possible. What we were thinking about is instead of putting 15% on retirement from May of 27, which is when we have a emergency fund fully funded until that maturity day of 2030, we would like to focus aggressively on paying the mortgage down. We've worked through the Ramsey mortgage payoff calculator and it shows that if we put an extra 3,000 on mortgage each month in that time period that we would go into 2030 with only about 36,000 left on our mortgage. And this would allow our new mortgage payment to be within the 25% take home pay guidelines that you guys suggest. What's it at right now? What percentage is it at right now? I am not sure off the top of my head. Is it above 25? What is it? Around 20. And I believe. Okay. I'm just a little, I mean, I'm always nervous about an adjustable rate mortgage, especially, I mean, with mortgage rates right now, there's no part of you that's just wanting to go ahead and, I mean, why wait till it matures, why not just go, I'm going to refinance this thing. It's already at 6.99% so you're not far off from what it would be. If you were to lock in just a fixed rate 15 year, is your current one 15 years at 30? It's a 30 year with a balloon date of five years. And I'm just, I'm just going to tell you, I'm nervous about that because if you were to swap to a 15 year fixed rate, I think that it's going to, I don't know what it's going to do to your payment, but I think it's going to move it up a little bit and how much home you can afford and you're 25% but if I were you, I'd be trying to get out of this adjustable rate mortgage. That'd be thing one and then my goal would be to get then to a 15 year. People ask me all the time, George, what's your number one money-saving hack? I'm glad you asked. Nothing makes me happier than helping another frugal friend. So here's the hack, get on a budget. Seriously, how are you supposed to save money if you don't know how much you're spending in the first place? And that's what makes the every dollar budgeting app a game changer. With every dollar, you'll get a clear picture of your spending and from there, it's easy to see where you can get more intentional, cut back and save more money. How much money are we talking? Well the average every dollar budgeter frees up $395 in their very first budget and if you ask me, I think you're way above average. So why are you still listening to me? Go download every dollar for free and start saving more money right now. Our scripture of the day comes from Deuteronomy 28-12. The Lord will open to you His good treasure, the heavens, to give the reign to your land and its season and to bless all your work of your hand. You shall lend to many nations, but you shall not borrow. Theodore Roosevelt said, "When you play, play hard, when you work, don't play at all." I don't know, I think we can kind of play it. I don't know. I don't think I have some kind. Come on Theo. I don't know. Lighten up Theo. He's an intense man. He did good for the history though. All right, let's go to Christina in Atlanta, Georgia. Hi, Christina. Welcome to the show. Hi, thank you. Hi, yes. Thanks for calling. Hi. Yeah, I'm calling because I currently am dating my boyfriend with a dating for like close to a year almost and our income levels are very different and I just really don't know how to handle that in terms of like compromising in the future. If I want it alive with him, that means like either I have to kind of like lower my current life in a way or start paying for part of his stuff and I just feel like that this purpose is really big. - Okay, what is it, what do you make, what does he make? - I make like about 155K and he makes like 50K. - Okay, what is, go ahead. - Well, what does he do for a living? - He works for a logistics company, kind of like trucking and dispatching. - Okay. - What do you do? - I'm in technology, I'm a project manager in technology. - Okay, great. Is he motivated, like is he a motivated person? I don't think there's anything wrong with what he's earning. I just think that the bigger thing I'd be looking at is what's his attitude? Like is he a motivated person? Is he interested in the same goals I'm interested in? Is he a person who likes forward movement in his life? 'Cause it sounds like you are. - Yeah, I am very driven and motivated. Like every since I am watching college, I was like always like wanna make money and I'm in a really good financial state. I don't think you have the same motivation or like drive that I have. I would probably have to push him. I think you like just listen to me, like it's been kind of like motivated seeing me, but I just don't know as like moving in together. Like that would be the next step. And I wanna take it, but at the same time, I don't know how to make the finances and then have to lower a lot of the things that I currently do. - Well, I don't, let me clarify. I don't think that he has to be exactly like you. I'm just saying clearly you value someone who is motivated and is interested in forward movement. So I'd be looking for some level of that. I'd also be interested in knowing what his philosophy is with money versus yours. If you're not, if you're a no-debt person, is he a no-debt person? If you're a, I want to invest for my future and I put money away. Is he interested in savings in those types of ways? Like those are the conversations I'd be having more so than what's the dollar amount that I make every single month 'cause the truth is you are also in different fields. And he may cap out at 100. You might always make a little bit more than him. And so is it just like, gosh, I just want a guy who makes more money than me or are there other factors that you're looking for characteristics that you're looking for in his character? - Okay. I think my biggest concern is retirement. Like I have a lot of money already saved for retirement and like he doesn't. - How old are you? - Just because he doesn't make enough money. I'm 33. - And how will T? - How old is he? - 30, sorry, 35. - 35. - Kristina, I mean, well, we don't recommend combining finances at all until you're married, okay? So once you get married though, then yes, I would say it all goes into one pot and you wouldn't have to lower your lifestyle because you're gonna be making what you're making. He's gonna be bringing in $50,000. So you guys as a household with these numbers would be making $200,000. So as a household, we're gonna be investing 15% of our income as a household. We're gonna be budgeting, as a household. We're gonna be buying a house together. Like that's the movement. So it's less about who brings in what, but to see yourselves as one. Now, if you don't feel good about that, then yeah, you probably shouldn't marry him. - Okay. - But I would say I would push a little bit to look at this as more unity for the future, right? Not today, but in the future. - And the next step doesn't have to be moving in together. That does not. The next step for you could be like, I'm gonna date this guy a little while longer. I'm gonna open up these conversations, figure out what his motivations are, figure out his philosophy on money. And if I like that, then I'm gonna keep dating him. And if he wants to propose, then we can cross that bridge when we get to it. But don't feel like the next thing you have to do is move in and come back and combine your lot. - Yeah. - Your finances, for sure. - Yeah. - Okay, yeah, I just feel, it just feels a little uncomfortable to talk about money and coming from like a, I don't know, like more abundant place for me, so. - Do you think keep feeling comfortable or you feel uncomfortable? - I definitely feel uncomfortable. - Why? - I don't know how he feels. Just because I am always like cuddling and buying things and doing a lot of things that he cannot do. 'Cause he feel away about that. Has he expressed gosh, I'm left out or I don't, 'cause what I'm trying to get at is maybe, he feels really great about what he's doing in his job and he's feeling secure and may, I don't know, but maybe you're just automatically projecting that on him because you make a little bit more. - Yeah, okay. - It may not be as big of a thing. - He hasn't said anything. I just don't wanna, I've been so scared to bring it up, basically, just because I don't wanna, you know. - Does he know what you earned? Does he know you make 155? - No, no. - Okay. - He knows it makes a lot more than he does, but he does not know how much. - Well, know this Christina. Money is a massive piece of a relationship, okay? And being on the same page with money is a big part. As is, you know, you could say spirituality, talking about that, in laws and family. I mean, getting to know someone is a big part of building a relationship. And when you hold this part away from him, he doesn't have the opportunity to know you, right? On a level of what you're doing. And so, I guess I could see your fear of how he would react, but I do think there's a level that you may be making up a story in your head that's not really there. - Unless it's a deal breaker for you, I'm just curious, is it, when you say like, the guy I want, is it one of your gender roles that it's like he needs to make more than me? And if so, why is that? - No. No, no, it's not. I just, I just want to feel like superior to him. And eventually, I don't know this. I feel like that's how it would come off if I would say like, okay, here I make three times more than what you make, what do you think about money? - I would be interested to see how he feels, but today, I think it's more your issue than his. - Okay. - And this is not to say that you can't have that, and I think you should have that conversation and just say, hey, we've never talked about money. Like, get to know him first before you just drop the bomb, and hopefully he's asking you the same types of questions that you're asking about him, and let it unveil itself pretty organically. This is not the conversation to be like, hey, how much do you make because I make this, and I just feel like it's gonna be a problem? Just start talking. - Yes. - And see what comes about organically, don't have the conversation in order to like, figure it out. Just start getting to know him financially, and I think that it'll unveil itself in an, it's been a year, I think you've got some time to. - And the only reason you would do this, Christina, is for a future that you see with him, right? And if this is gonna be a person that you say, yes, I see a future with him, and I'm gonna combine my life and I'm gonna make a vow to him, to be with him for the rest of my life, and I'm gonna be married to him, and I'm gonna be his wife, and he's gonna be my husband. Then these are very, very crucial conversations to have, to make sure you guys are at a good spot together, heading into creating a new life, right, together. So like Jade's saying, if marriage isn't coming soon, don't, I guess there's probably not an urgency for this, but if you're wanting to move forward in this relationship, then yes, this is a subject that needs to be talked about. - Okay. - So, yeah, I hope that helps. I mean, I think the you feeling superior, your net worth is not yourself worth, and that's true for you too, and I think you know that, you're not three times better than him because you make more money, and you could be building up something that again, it may not be there for him. He may be okay, and he loves you, and he loves who you are, and he's been in relationship with you for a year. All right, that's a great hour, Jade. - It is. - Always fun hosting with you, thanks to everyone, and the boasting story great audience that came out today, and remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.