Different Outcomes Require Different Choices

Brought to you by the EveryDollar app, start budgeting for free today. Normal is broken, common sense is weird, so we're here to help you transform your life. From the Ramsey Network and the Fair Wins Credit Union Studio, this is the Ramsey Shop. I'm Dave Ramsey, J. Washaw, number one best selling author, Ramsey Personality is my co-host today. Carlos is in New York City. Hi Carlos, how are you? Hey, hi. Thank you for taking my call and God bless you all. You too, sir. How can we help? Yes, I'm 64 years old. I work as a security guard. I don't have any savings and I got about a thousand dollars in medical bills. I own like 20,000 in credit card and I own about 12,000 in IRS. And you're working 40 hours as a security guard? What do you earn? About 55 a year. Is it just you or do you have a family Carlos? Anybody else in the house or wife? No, I'm recently divorced six years. So, did much of this happen because of the divorce or help us understand how you got here to 64 with really nothing to show financially? I'm very embarrassed with myself because I went through a lot in my life and I never, I was never teach about saving. I didn't have the right advice. I appreciate that. I'm very embarrassed to help myself. We're not here to shame you. We want to help you go forward. The only benefit of looking back is figuring out what not to do because it brought us here. The old saying, if you keep doing the same thing over and over again, you're going to keep getting what you've been getting. You don't want to expect the different results. So, we've got to have some pretty dramatic changes to get out of a pretty dramatically scary situation. This is a little scary for you. You're looking down the tunnel and the only light coming at you is a train, right? Yeah, and I forgot to tell you, I just had my physical and I was diagnosed with prostate cancer. Oh, no. What are the doctors saying is what's your prognosis is looking good with treatment? Well, everything is normal now, but I have to go on to September 9th to see if surgery is the best or what they call like laser or something like that. So you're going to be down from work for a little while and you've got health insurance and you probably got some sick time at work you can use. But they're going to do at least at least an outpatient surgery here, maybe a major surgery to remove that. I'm sorry. Okay, so yeah, yeah, kind of stacking up on you. Oh, and I forgot to tell you that I'm sorry, Dave. I forgot to tell you that. Give me some good news, Carlos, for God's sakes. Yeah, I forgot to tell you that I have like a PIAG craft where they call it. Yeah, yeah, what's in that? I have about 40,000 in there. Oh, that's goodness. Okay, good. That is goodness. Well, here's the overall thing. The overall thing is in order for you to have a quality life at 7D, 6 years from now, we've got to clear up the debt and pile some money into that craft and into some other savings vehicles, right? And so if you really lean into it for six whole years and you're going to have to, you know, when you hit 70, you should be debt-free and have piled another 100,000 or 200,000 dollars into that account. And you'd be sitting there with a couple of 100,000, 250, 150, whatever it is, somewhere in there and no payments. And you've got Social Security coming in at that point and you can make it then. But you can't make it. Keep doing what you've been doing. How do you live Carlos? Are you renting or are you in a place of your own? No, I'm in what they call like a furnished room. It's an apartment, but I rent a small room. Okay. And my rent here is 800 a month. Yeah, okay. Yeah. Yeah, we're going to put you on a debt. We're going to put you on an every dollar budget and your first goal is put a thousand dollars away. Your next goal is to list these credit cards and these other debts smallest to largest. I want you to clear the IRS and get them out of your life. You do not want that hanging over your head. Get these credit cards cleaned out. And then when that's all gone and you got no debt, you got that little thousand dollar debt we got to get rid of. And when those are all clear and you don't have any payments, then you take that budget and you squeeze it like your life depends on it because it does. And you start throwing and chunking as much as you can set aside. And you know, that's seven, eight thousand dollars a year that you could do for, say, five years. So that's another 40 or 50 thousand dollars you would have set aside plus growth. So you'll probably be with that other, with that other 40 laying there, you'll be between 150 and 200 when you get to 70. But in that saving only 15% of your income, you probably could save more than that if you can once you've gotten the debt cleared. Because the more you save, the bigger your nest egg is going to be, duh. And the more comfortable your sustainable your situation is going to be when you get there. Yeah, this is going to require a major shift in how you approach each day, major shift. Yeah, but I think you can get there to you. I think you can get to 150, 200, probably. Yeah, yeah, 100%. I mean, making 55,000, he's got 800 and rent his rent being low, even though it's just a room that he's renting, his rent being low is really going to help him out. And it's just him. There's nobody else to speak of. Yeah, you know, that's and just lean in and just, you know, but it's it's going to be as. And I'm going to use the embarrassment you called it, as a motivation, like I'll never be here again. So like Carlos, when I went bankrupt and lost everything, I was embarrassed. I was ashamed and I was really pissed off at myself and at everyone who was near the thing. So I'm still 40 years later mad at bankers. And I don't feel much better towards the lawyers. And so I've just generally, you know, just generally stay pissed off all the time. And that has driven me to get away from all this, you know, and to say I'm not going to be there. You know, if American Express calls my house, it's a wrong number. Because I don't want anything to do with that company. They're absolute hogwash. I don't want anything to do with that company. I don't want anything to do with some trust financial. I don't want anything to do with fifth third ever. Period, under no circumstances. You know, and so you just, in other words, as dramatically as I was heading the wrong direction, I dramatically headed the other direction. And that's kind of what I'm calling out here. And so sometimes the answer is some drama created drama. And it's to avoid the embarrassment, the shame, the anger, the source of the anger, whatever it is. And I'm just going to stay away from anyone that looks like they can do that to me again. And yeah. Well, the good news is if he does that, he's got the 40,000, and I've just plugged in our calculator here. He's got the 40,000 already sitting in TIA CREF. If he continues to put 15% of his income in for the next eight years, I mean, that's going to be $200,000 for Carlos. So I was pretty close. Yeah. And if I did it 200,000 was my guess. Good. And it shows up in the calculator. Hey guys, it's Rachel Cruz. When it comes to life insurance, most people fall into one of two camps, the ones who make a plan to protect their family, and the ones who hope everything will just work out. But hope isn't a financial plan. When you get married or have kids, your money decisions aren't just about you anymore. Your income helps keep the lights on, pay the mortgage, and put food on the table. And if something happens to you, will your family have protection or uncertainty? Well, at Ramsey, we recommend term life insurance that 10 to 12 times your income with a 15 to 20-year term for the years that your kids are at home and your mortgage is still being paid off. That's why Winston and I have our term life coverage through Zander Insurance. They're an independent broker who works for you, shopping all the top companies to find the most competitive prices on coverage you need. Get instant quotes online in just minutes at zander.com or call 800-359. for two eight two to get your family protected with term life insurance that zander dot com or eight hundred three five six four two eight two Susanna is in Chicago. Hi Susanna. How are you? Let me try one more time. Hey Susanna. How are you? Doing well. Thank you. How are you? Better than I deserve. What's up? Thank you so much for taking the time to speak with me. I'm just calling. I've been doing a Dave Ramsey budget for the last probably nine or ten years since I got married. And every month we are short and every month we're pretty much paycheck to paycheck. And we're big grownups. I'm 52 my husband's 48 we have careers and we make decent money. But seemingly every month while going through the budget we do seem to have a difficult time. And there's never any extra money. My husband did have a career change recently. And so we took out a giant loan for him to have a career change. And we have a vehicle and we just bought our first house and we just had an adoption for our son so there have been some really big expenses. But it all looks great on paper when I write it all down and all the takes and balances. But then when we try to see where did we go wrong it's just very hard to sort of get it right even after all these times. And we've had some financial advisors help us and look through things. I'm kind of I'm kind of doing it on my own the budgeting. So I guess I'm just looking for a way that you could advise. I'm sure the steps are perfect. And if I follow the steps and I would be within where I need to be. But I'm just looking for a way to be more successful. I know that we do make decent money. And when I go through my budget, I'm just surprised that it's always so tight. And while we do have some large expenses. Well, that's what you're facing is what a lot of folks face. When you have debt, it turns a good, a quote, good income into paycheck to paycheck living. That's what it does because you've said, okay, there's these things I want a car, a house. I want to do the adoption. I want to do the business. But you've done it all on payments. And that's what's dwindling away. You're really, really good income. So that's why it feels like I'm working and working and have nothing to show for it. Because you keep buying stuff on debt. You have to stop that. Yeah. So what is your income? No, I mean, you got to stop that. I mean, I don't want to hear any excuses. No, you got to stop it. But how do you buy a home? Well, you don't when you're freaking broke. You don't buy a car and you don't go in debt for an adoption. And you don't go in debt to change your careers. Period. You save up the money to do those things or you don't do them. How could you ever send out, save up 90,000? You live on less than you make. 90,000 dollars for what? He's a pilot. Okay. Well, maybe he didn't get to be a pilot. There's an option. But now that we're here, you know, you can't say, James, exactly right. You guys got to stop borrowing money and then wondering why you don't have any. The reason for this Susanna is because if we just jump straight into, here's how you get out of it and you never figured out what the problem was. You'll go back and you'll repeat it again and the solution won't stick. Yeah. So the way you become a pilot is very, very slowly. And you work there giving lessons on the weekend and you get your hours in for free as an instructor. And that's how most people go through flight school or they go 90 grand in debt. And then they get a job making not a lot, not a lot of money. Beginn and pilots don't make a lot. So what we can do, what we got to do to get this out of control under control, this out of control situation under control is to Dave's point. First things first, you've got to decide I'm not borrowing money. How much is your house payment? It's per month. It's 2500. And what's your take home pay a month? Mine personally, or how's the household income, the household income? Our household income is about 122. We rent out part of our home as an Airbnb. So your take home is about a grant? Does that sound right? No, it's more than I'm saying it. What our take home is 122. Oh, you're 122. So 10,000. So you're at a fourth of your take home. Give or take is your house payment. So that's not the problem. What do you owe on the car? We owe, it was a $45,000 car and now we owe 12. So we've thrown a lot of money at that. And then for the loan, somebody helped us out so that we had a lower percentage. And we owe left of that about another one year. So we owe about 38,000, I would say. That's only adoption. No, we've paid the adoption on the adoption. You're talking about the $90,000 on the pilot. Correct. You got that down to 38. 36,000. 36,000. You're heading the right direction. Yeah, you've been working on this. You've been beating it down. Yeah. But of course you've got no money because you've got these big stinking expenditures that turned into debt. And that's where your money's all going. So, I mean, it's not like doing a budget doesn't work. Yeah. It's doing a budget while you're reducing debt this dramatically. It's not going to leave you any margin. So yes, you do need to sit down every month. You and your husband look at the every dollar budget and plug that in and spend every dollar on paper. And that includes huge amounts of debt reduction, what you've been doing. And no eating out. And no impulsing anything. Nothing. You don't get to buy anything. You're broke people. And you just attack these debts smallest to largest with every piece of margin. We can squeeze out of this budget. But the two of you need to be doing that together. So the thing that I want you to remove from your discussion in your head, if I were you, this is what I would do. When you called in, you said, "We've been doing the day Ramsey thing for like six years." And the answer is, "No, you haven't." Because you wouldn't have done any of the crap you told me you did if you were doing the day Ramsey stuff. Because we don't tell you to do anything you were doing. And so you said, "I'm sitting down to do a budget by myself. That's not what we teach." And then I get to the end of the month and I can't figure out what happened. That's not what we teach. So you know, you're tempted a budget has been okay. And thank you for doing that. And I'm glad you're reducing your debt. But so far, the reason you're not getting anything out of this is you're doing it halfway. So the full way is you sit down with your husband before the month begins and say, "This is where we're going to spend money." And we're not going to spend money anywhere else. And we're certainly going to lay out a budget that's tight, that every dollar has an assignment. So everything's gone. Everything comes in, everything goes out. But it's going to be chunking on this debt. And we're going to get our satisfaction from that. And we're not going to have anything left over. And we're not going to have any luxuries. We did an adoption, a pilot's license, and bought a house, and we can pay in for that now. And then we're going to stick to the budget. We're going to just pinky swear and spit shake. This is the plan. And pretend like it was your job to stick to the budget and then we're going to fire you if you didn't stick to your budget. Because that's what would happen if you worked somewhere. I've got 14 profit centers inside Ramsey. The vice president that runs an area has a budget. He misses budget three months in a row. He's probably working somewhere else. Unless there's real reasons that were beyond his control. Or she. So I mean, you need to lay out and plan where your freaking money's going and then make that happen. And that's if you work here, right? And that's if you work somewhere and this was your job. So treat it like it really. It's not a passing thing. It's not like, well, we're going to write it down and hope it happens. No, we're going to write it down. And that becomes the boss of you. It tells you what you must do. No, they must do it. There's 52 years old. When you're 48 and 52 years old, you must do it. Yes, you must. Or you're going to end up like Carlos who called in earlier at 64 with nothing saved for retirement. And you have to stop buying anything for the rest of your life unless you pay cash for it. No rationalizations. No justification. No, it's the only way you can do it. It means you can't do it. If the only way I can do that is go into that. I can't do it because I don't borrow money. And that's me. If the only way I can do X or Y or Z is if I have to borrow money, I can't do it. I don't have enough money. And I'll guarantee you, there's every one in the world has to eventually go, I can't afford that. No matter who you are. I mean, even Bill Gates, there's some things he can't afford. Not much, but there's a few things he can't afford. Jeff Bezos, there's a couple of things he can't afford. Not many, but a couple. I can't, assuming he's paying cash, I can't afford that. (upbeat music) (upbeat music) Hey, it's Rachel Cruz. I don't know about y'all, but I can build something up in my head until it feels way harder than it really is. I'll convince myself it's going to take forever, be super complicated or cost-a-fortune. Then I finally sit down to do it and I wonder why I waited so long. Making a will might be one of those things for you. That's why I love mama bear legal forms. They've taken something that can feel overwhelming and made it so simple. Their online wills are designed by attorneys and tailored for your state. And while you're on the mama bear website, it'll walk you through the whole process step by step. So you feel confident that you're doing it right and that your loved ones will be taken care of. Plus, making your will with mama bear only takes about 20 minutes. So don't make a mountain out of a mole hill. Go to mamabearlegalforms.com and use promo code Ramsey to save 20% on your will. That 20% off is exclusive to Ramsey fans only. Mamabearlegalforms.com was promo code Ramsey. (upbeat music) (upbeat music) Well, tonight for those of you listening live, September the first and second, the first is today for those live, we'll be doing our investing essentials event. That's George Camel and I doing a virtual event for thousands of you, a record number of you have signed up for this. Thank you so much for the response. We're going to go into the nerd stuff on investing down in the details. Not only cover the basics to make sure everyone has a seat at the table, but then from there, investing 201 to go with 101. Gonna go open the real estate playbook and go, here's some properties I actually purchased. Here's why I bought them. Here's what the returns are. Here's how you do it. And then we're gonna go into wealth planning. How to not destroy your family tree with your wealth. People always ask, "How do I not mess up my kids?" Well, I'll go ahead and spoil our alert. You don't mess up your kids with wealth. Your wealth reveals the fact that you already messed up your kids and so we'll go ahead and tell you what the answer to that one. But anyway, we'll get there and we're gonna cover stuff like doing your will and basic estate planning stuff. Wealth planning, which includes estate planning. And that's tonight and tomorrow night. It's a two night event. It's so it's hours and hours and hours of this stuff for 199 bucks, a virtual event. You can watch it from your couch. And RamseySolutions.com/events and click the link in the show notes if you're listening or on the podcast. Dave Ramsey and George Campbell will be doing it. D is in St. Louis. Hi, D. How are you? - I'm live in the dream and by the way, so happy to be able to talk to you and Jade. - Thank you. - And love you both for your ministry and the rest of the team. I have a question that I'm dealing with. It's a struggle. My husband and I have gone through all of the baby steps. And so at this point, we're debt-free other than our mortgage for our house, which we have significantly paid off for the time. - Well done. But I would also say that I have a relationship in the family and that would be my brother. And his wife, they have two kids, my nephews. And we haven't spoken in a couple of years. And I think mom and dad help them out here and there, just to keep access to the kids. And so I'm really struggling with whether I decide with my husband to come up with some sort of fund for the boys, for college, or whatever, but also I'm struggling because I don't want my brother and sister-in-law to have access to that money. Because I'm not sure that they'll be wise about how they use it or spend it. And I know. - So what's your household income? - Me and my husband. Should we talk about salary in a way? - I don't know, what do you make any year that you pay taxes on, that your household income? - Yeah, well, I make $350 a year, but with bonus, my target is $458 this year. - Phenomenal. - And my husband brings home W2 about $68 to $70. - Awesome, so you're gonna have me a dollar a year in income. That's wonderful. And you've done very well, congratulations. And yet these are not your children, so you don't have any legal access to them. They're minors, I take it. - Yes, they are. - Okay, all right. The only thing I would do is finish paying off your house and pile up cash and become very wealthy. And then if at some point that they reach college age and you want to write a check and pay for their tuition, you just take it out of your account and write a check and pay for their tuition. - Okay, but you wouldn't do that. - Absolutely, you would do nothing with anybody's in the army, but your brother is not trustworthy. - Yes, wow, that's true, for sure, with money. - Yeah, I'm not putting any money in his name. He doesn't talk to me, no way. But if those boys go off to college and there's an act of love, you want to reach out to them maybe through your parents and say, you know, old Aunt D, that you heard all the bad things about, it's gonna pay for your tuition. - This border, that'd be kind of fun. - Well, it would be great. I just, like, I struggle from it. Like, from a moral perspective, because it's not the boys in jail. - Yeah, but you don't need to put any money in the boys name, you can just take care of them. There's nothing immoral about you giving the boys, paying their tuition for them. - How old are the boys? You said they're minors, but how old are they? So the boys are in seventh and ninth grade now. - Are you concerned for them that you feel like you need to do something prior to college age? - No, I'm not concerned in that regard. I'm more focused on the fact that they don't have any background, right, like to wait. My parents, when they raise us, they put us on the credit cards early in age, and I would have to ask permission to spend 25 bucks, but that was to build, like, you know, credit history, kind of. - You know, this is not your circus and not your monkey. They're not your kids. - I know. - If the kids are not in physical harm, then you got no sayings. - They are not. - You got no say in it. - None. It's just part of the heartbreak of the astrangement. - Yeah, I agree. - But there's nothing that you have the right to do or the ability to do to fix those kids' life, nothing, unless you call child services because they're being abused. - Yeah. - And they're not. - So, you need to be quite worried about whether these kids are raised with work ethic, whether they're raised with integrity, whether not your monkey, not your circus. You can pray for 'em, but that's all you can do. - And, you know, I feel like you can do things now that will allow you to cultivate a relationship with them when they're older. Like, now, you can make sure that you send them a birthday card every year or holiday card. Like, right, there's ways that you can be part of their life so that when they are 18, you can kind of show up. And if you suddenly want to bring them to dinner or find a way to create a relationship with them, it's not we've never heard of D before. - I'd like to buy your breakfast and hand them the receipt where you've already paid for their tuition. Don't give 'em a check. - No, don't give 'em a check. - Just give 'em a receipt where you've already paid for it. And that kind of stuff. I mean, that's the kind of stuff, but you're, they're gonna have to reach adulthood before you're gonna be allowed access because of this estrangement. And so, Jade's right. I mean, you can send 'em a note, send 'em a letter, send 'em things through your parents or whatever, but just letting them know that you're there and that you care about them. But you don't get to control how they turn out. Not your monkey. Not your circus. And you just don't get to, and so even the influence that an ant would have in a normal setting is limited. - It's limited, yeah. - Our kids live on top of each other. They live three doors down and a quarter of a mile away from each other. So their kids are all growing up more like siblings than cousins, but that's the most. And but even then, it's not Rachel's kid. It's the nace's kid. I mean, they don't, they don't reach over and tell 'em, we make 'em all, we make 'em all behave, but that's. But that and that and we're freaking on top of each other. Yeah, but you have more you definitely have more of those Liberties when there's a healthy relationship about the siblings and she's just I mean even then there It's not it's not you don't get that you don't get to parent them. No, I mean I'm we were at the soccer game last night But I don't get to parent them. I can just y'all kick the ball. That's one thing I'm allowed to do, you know I mean it's like that's it and so That that's normal boundaries Yeah, and you've got even worse boundaries here because of this is Strangement late day. I think you might be trying to fix your broken heart through the kids And it's not gonna work The broken heart's just broken because of the a Strangement and that's just sad and Someday hopefully that'll be mended and Maybe you can do some nice things for the kids financially as you get there from your checking account You Running a business is hard enough. 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Well, so to give you a little bit of background my wife and I moved about a year ago back to the hometown long run for our job and We have had our house on the market since January and We don't really know if we should continue to try to leave it on the market or maybe try to have a bigger Investors model I turn it to a rent house or an Airbnb kind of thing and it takes up about a third of my salary and So that could be a lot of money that to go towards the debt that we have or 200 and 15,000 what's wrong with it? Nothing it's four bedroom two bathroom at the six-year-old house. We built it in 2020 and the you know interest rates were about 3.1 And so we paid a hundred and fifty-nine four I 140 on it and excuse me. I'm at two twenty five not two fifteen Okay, is it too expensive or is it there's is it at neighborhood there's something going on or I mean Is it a piece of ground or the kind of that's the kind of conundrum that it's right by university and it's right by a hospital and So I thought, you know, it's selling no time. I'm a realtor can't seem to get any feedback There was only been we've had we get about three showings a week and I don't know I really just don't know what the what the issue is. I mean are you objective enough to stay say if you stand in the street is this house ugly? No, sir. No, it's a very beautiful house. I mean, it's kind of cookie cutter It's like a lot of houses in the neighborhood, but have other things in the neighborhood. So no, sir It's kind of that's kind of the thing. There's a lot of other houses up for sale and so I don't know it what cities it in again know to be honest So it's on a it's on the outskirts of Oklahoma city. It's close enough. It's technically called Shawnee. Yeah, I know Shawnee. Is it freestanding or is it attached? No, it's freestanding. Huh is it a Ramsey trusted real estate agent? No, sir. Okay. Or not that I'm aware of. Have you seen a competitive market analysis when they listed it did they show you the comparative sales in the area to give you a value? Yes, I can't I know they showed me the report back when we priced it and so they thought it would easily sell for 250, but I've worded it to 25 since then Okay, and your monthly payment is how much? 1,200. Okay, so every year that is sister cost you 15 grand in payments Yes, sir. Okay, so if you lower it 30. It's not that's not smart Because I'd rather sit there and wait Okay Assuming we've addressed anything that's wrong with it. Okay, because the first thing I think about from a real estate perspective is When I walk up to the front door, what am I seeing and what am I smelling and when I walk in the front door? What's the feel? And is this bad floor plan is the colors awful? You know, what's the and a real estate agent with a little bit of experience should have the ability to kindly tell you By the way, your carpets ugly You know, I mean they need to be able to come yeah, they need to say that to you and honey You need to change just a living room carpet this thing and go sell because people walk in see this they start itching You know, I mean whatever it is. I don't know, but you said it's by university and hospital. Are they getting the ambulances? Screaming through there every you know 10 minutes. Is it Is it the university traffic? Yeah, it's both. I mean the university is not it's not a huge university So I I really wouldn't think it's connected to two major highways So I mean not directly the neighborhood sits between like what they kind of intersect so I don't know but When you were talking about the flooring and stuff. I mean, it's all new flooring like we we paid about yeah You just finished that house isn't that old yeah, but I mean again, you said is the highway in your background or you want to You know up against the freeway those are the sorts of things that I'm thinking of based on what you're saying Well, yeah, no number one the first thing I'm gonna call a Ramsey trusted real estate agent And or two and have them come out and interview them and look at the house and tell you what why this thing isn't selling Get somebody out with feet on the ground that knows Shawnee that knows what the market's doing They go look here's six other ones just like it that if sold there's no reason this hasn't sold We need to put this on the market at 219 9 With a selling bonus to an agent and let's get this thing moved Something like that. I'm maybe I might drive I would take it off the market put it back on the market with someone else That starts a new listing yes number and put a slightly different price on it 29 9 or 19 9 from your 25 number and And I'm also going to go through do I need to put a coat of pain in this do we need to go in there and bake bread every morning So this smells like mama's kitchen when they walk in what is it we got to do to market this property and And then I'm gonna wait and wait on my buyer Because you you know 1500 bucks a month you can wait a long long time Before you give up 30 or 40 or 50 thousand dollars in price cut um And so you know you can decide Stuff like that and um I did do one one time that I don't know if I would recommend this to anybody, but it was kind of fun I just dropped the price $2,000 a month until it sold Let's put a new price in MLS every time and just kept and I don't know if I recommend that and I don't know how and it was kind of weird But it's like a reverse auction, you know and it was kind of fun just to mess with it Just see if we could wake somebody up. Yeah somebody sit around and we're going oh, I don't know if I'm waiting gonna wait Get away. Get away. You know, and we finally just got we finally just got a good offer on it and sold it, but yeah Yeah, but I don't think that's the case here. I can't tell You don't know why I didn't selling and so we don't know why it feels like for them the neighborhood was fine But for other people it's not a desirable neighborhood just based on what he's saying something going on there. I don't know And you know, I need a real estate agent to tell me what The get feed back from showing if you're getting three showings a week you should gotten offer Yeah, for sure. That's that's a lot median days on market is 57 days in the nation right? Yeah, and he's been on since January. Yeah, yeah exactly All right, Aaron is in Houston. Hi Aaron. How are you? Good. How are you better than I deserve. What's up? So I'm a college student and I'm expecting to graduate here this year. Congratulations. What's your degree in Let's go engineering. Hmm Future millionaire But after graduation, I'm looking at about $40,000, I'm going to be in debt from student loans. But I'm talking about, I'm looking at a draw up for that I've been interned with. I'm expect to get a return offer with about $100,000 annual salary plus 10K signing bonus. God, that makes you smile. Wow. I mean, it does. You know, I work really hard. So if you live like a college student, you'll be debt free in like six months. Yeah, because that 10K signing bonus is about to knock out a quarter of that student loan. And Aaron, you don't get to buy a car. My parents had made that abundantly clear. No car. Do you get the student loan paid off, even though you got the big fancy job. I'm proud of you, man. That's a great job. Congratulations. Yeah. Can you not just go live on nothing and keep living like a college student and pay off 40 grand in less than a year? Yes. You can. I'm going to answer that for you. Yeah, that's my next question. Do I put all this $10,000 for the boxing and loans? Yes. Well, you got to cover your move. You're going to need some for deposits on utilities and deposit with the apartment. And, you know, you got to have some gas to put in the car to load your 14 things you own in the car. Do you have any other money or this is it? I have the babysit number one. We're having $1,000 in savings. Good. I would get moved. I would get moved, get moved in without spending any money. The minimum money. And then I'm going to throw what's left down to $1,000 at the student loans. And then I'm going to start, I'm just going to live like I'm not making anything. I'm just going to live on nothing. You're used to living on nothing. Yeah. You're a college student. Do I move back to my parents? No. No. This version of nothing is still going to feel like an upgrade. Like you living on this version of nothing, just because you're earning a paycheck is still going to feel like an upgrade from being in college and being in a dorm and being on campus. But no eating out. No three-ups, no buying a car, no buying a bunch of furniture, buy garage sale furniture. Yeah. But the rich end of town and buy some ladies' couchs as you're throwing out that there's nothing wrong with it. And buy it for $18 and haul it away from her. You know, and that's how you furnish the first apartment and then you go pay cash for this. Yeah. I'm so proud of you, man. It's awesome. If you want to free up margin in your budget, one of the first things you should do is take a hard look at your monthly bills because every dollar you overpay is another dollar you don't have for reaching your financial goals. And overpaying for your phone bill, well that makes zero sense. And it's why I recommend Boost Mobile. Their unlimited plan is just $25 a month forever. No contracts, no hidden fees, no surprise price hikes. If you already have a phone you love, you can keep it and keep your number when you switch. And if you're skeptical, Boost Mobile offers a 30-day money back guarantee so you can try it risk-free. Listen, your phone bill should fit your budget not the other way around. Reaching your financial goals is easier when you can pay less for the same service. Switching to Boost Mobile now is just a smart money move. Go to boostmobile.com/ramsy and make the switch today that's boostmobile.com/ramsy. $25 for ever requires customers to remain active on Boost Mobile and Limited Plan. Welcome back to the Ramsey show in the Fair Winds Credit Union studio. Jody is in Toronto, Canada. Hi Jody, how are you? Hi Dave, how are you? What's up? Hi Dave. I listen to you guys like every day while I'm working, there must be all but on the farm that I work. I'm so excited to actually speak to you guys today. I'm so excited to speak to you too. What's up? Oh, so I'm trying really hard. I've been listening to you guys like avidly since like the end of February, like daily. And I'm so encouraged by like the whole team with them and like you got this, you can do this. So I'm like, I've got motivation but between my income and like what I like have available after expenses, I'm having difficulty getting my baby one earth, baby step one emergency fund and sending aside like sinking fund, sinking fund, like item lines like kids, Christmas gifts, I have two boys, their birthday gifts, both birthday Christmas gifts, like all those little things, dental visits, like hard repairs, having those set aside and working on my emergency fund. And I feel like it's a weird time of year to start this because like Christmas is in like three months time. So how do I get enough at this point for Christmas, well, putting enough away from my emergency fund? And I have started my emergency fund. How much do you have? How much do you have so far? At the minute, I don't have anything as far as emergency fund. Okay. So here's what I would do. Here's what I would do. I would prioritize the emergency fund before getting into a bunch of sinking funds. The number one thing you need is a thousand dollars a day because if you don't have it, something pops up. Jody and you're going to be looking at credit cards, you're going to be looking at debt. You need a thousand dollars. Most people get it done in 30 days. This is scorched earth. So scorched earth means I'm not thinking about sinking funds. I'm not thinking about Christmas presents. I'm not thinking about anything extra except getting this thousand dollars a day. Matter of fact, I'm selling old Christmas presents to get it, right? I'm selling off things. So that's, I mean, your hair is on fire on this to get this thousand dollars. What's your income? I'm about 35,000 Canadian. What do you do? So I'm a farmhand at a local agriculture, agrochlorism farm. And your single mom? Well, no, I am married. Oh. I said, what do you mean? I mean, I meant what your household income. I'm sorry. What does your husband make? Oh, sorry. My husband is roughly about the same. He has his own family farm with his dad. Um, so his income is roughly about the same. So you have 70, you have 70,000 dollars a year coming in. So $6,000 a month. Technically, but our expenses are separate from one another. He still paying child support for his children that he has with his family. That doesn't mean you have to have separated accounts. No, no, no, no, like we don't even have a mortgage because it's included as far as like part of his salary with being a farmer here and there's like a lot of hydro expense. But that doesn't matter. The two of you still have seven, six thousand dollars a month coming in, don't you? Uh, I mean, you make 36 and he makes 36, right? Before expenses, you should have 6,000. Yeah. 4 taxes, we keep our like we keep our extended separate. I know. Okay. That's problem number one. You're trying to run us like a single mom, I mean, you're trying to run us like a single mom with a boyfriend and it's not. Do y'all live together? Yeah. Yeah. Oh, yeah. So the property that he is being furnished as a part of being a farm hand on his family farm is free to you all. So you don't have housing cost? Exactly. Oh, gosh. Even more. Okay. So you, why have you, why are you not combining your incomes? Um, just we're more comfortable this way. Well, it's not working. That's what you called us because you're not comfortable. It sounds like you're trying to do this on 35,000 and I don't know what happened to his 35. It was, it sounds to me like, well, majority of it goes to his child support. How much? No, he doesn't have a $3,000 child support payment. No, $1,000. Okay. So that's $1,000 of $3,000. Okay. So he's still got $2,000. Where's his other $2,000 going? Oh, there's the problem. Okay. Just found it. He's doing, he's doing, he's going there and playing farmer with his daddy and he's not bringing money home to his own family. No, no, he is, he lives like that free, he's good with his money. Here's the problem, Jody. He's not good with his money. His kids are not knowing how they're going to get Christmas presents. He sucks with his money and you guys need to put your money together and develop a game plan to develop that's where your struggles coming from, honey. It really is. You're saying that you're married, but you're doing this totally separate and you're calling here because you're experiencing the symptoms of that. You sound like a $35,000 or your single mom to me. Everything you described early in the call had that symptom. I thought you were making no money. That's the very first question I asked you was what's your income and you stated it as if you weren't married and then I had to dig to figure out you were married. So we can tell from the way this is going down, you're kind of trying to pull this whole wagon by yourself, kiddo, and that's not fair. So the two of you need to sit down and say, we're going to put our money together. We have the responsibility, our first responsibility. on this planet, both of us, as grownups of these two kids we made, and we have housing furnished. So we should have some money in this house, even with a thousand dollar child support. There should be some money to be able to get a thousand dollars saved and then begin to work your way out of debt. You can do this, but the problem is, is you're trying to, I don't know, everything is so dispersed that it has no power. Yeah. And by the way, because you said it, you said, oh, when we asked you, why are you keeping your money separate, so well, we've always done that, just because you've always done something doesn't mean you have to continue to do it, and just because you've always done something doesn't mean it worked. This is an opportunity for you guys to sit down and truly ask yourself the question, why? Why are we doing it this way? And challenge yourselves to answer the question with real answers, and I guarantee you it's going to be a lack of trust in someone's area. Yep. And I think you can fix this in about 60 days. By the time Christmas gets here, you're going to have your thousand dollars, you're going to be reducing debt, your budget's going to be working, and his child support will be paid, and we're going to be able to buy Christmas for our kids, and pay for their dental appointment. All of that can be done. The numbers are there with what you gave me. There's nothing here that's prohibitive, but you're trying to do it all by yourself. That's the problem. You're doing it on half your household income. That's what's going on, so we just, you can't go there. All right, guys, so here's the thing. Let's just cycle back on this again. The largest study of millionaires ever done in North America, we talked to 10,167 of them. 89% of them said one of the top reasons they became wealthy was that they combined everything and worked together towards one goal. When you ask the public how many of you combine your finances, it's only about 40%. And worked towards one goal, and the public is broke. 78% of Americans live paycheck to paycheck with too much month left at the end of the money. Stop it! Most people spend years changing their money habits, but never think twice about how their bank probably works against their values with nuisance fees and endless debt products. If you're being weird by sticking to the baby steps, you deserve a bank that helps with that. That's why Ramsey partnered with Fair Winds Credit Union. They built the smart bundle specifically for Ramsey listeners, not for everybody else. And it includes up to 10 high yield savings accounts so you can set up different funds for different needs and goals. And now they've introduced the live like no one else debit card. The original debt is normal, be weird debit card is still available too. And every time you reach into your wallet, your card is a daily reminder that you follow a different path. Listen, if you're living like no one else, your bank should back you up. Check out the Fair Winds smart bundle, including the all-new live like no one else debit card at fairwinds.org/ramsey. That's fairwinds.org/ramsey. Ensured by the NCUA. Today's question of the day is brought to you by Why ReFi. If you fall in behind on your private student loans, you don't need more shame. You actually just need a plan. Why ReFi helps borrowers explore refinancing options with a low fixed rate payment based on what you can actually afford. Go to whyrefi.com/ramsey. Might not be in all states. All right. Today's question comes from Owen in Alaska. He says, What's the difference between an index fund, a brokerage fund, and a mutual fund? Is there a particular type that you recommend? Or can they all be used for different purposes? Wow. Great question. I think that's a really good question. It's a teaching question. It is. Do you want to teach Dave? I can teach, but I feel like this is your bag. I'll jump in and then you can help me. All right. We'll start with a mutual fund. A mutual fund, if you visualize, is that Jade puts in some money. I put in some money and Owen, you put in some money. We have now mutually funded it. That's all it is. What the mutual fund buys with a mutual fund manager buys with the money that we give him or her to invest with tells us what type of mutual fund it is. If they buy bonds, it's a bond fund. If they buy with the money that we mutually fund, stocks and companies that are growing, it's a growth stock mutual fund. If they buy companies like Gerber and Nestle and Unilever, which own Stuff, Soap, and Ben and Jerry's Ice Cream, those are all foreign companies. They were started in the US in every case, but they are now owned by people that do not live in America. Those are international or foreign stocks. You'll call it an international stock mutual fund buying stock in companies internationally. That tells you the type of mutual fund. The typical growth stock mutual fund, for instance, will have 90 to 200 different stocks in it. As that group of companies goes up in value, that's where your return comes. One type of mutual fund is an index fund. The first one you asked about Owen. An index fund is a mutual fund that buys stocks that follows an index. An index is a representation of a market. The most famous index is the Dow Jones Industrial Average. The most accurate index is the S&P 500 Standard and Poor rates the top 500 companies on the New York Stock Exchange, the big board we call it, and those 500 companies are represented in an index fund. That's the baseline of what the stock market is doing. What the S&P 500 is actually the best measure of what the stock market is doing. Is it up? Is it down? That tells you what the stock market is doing good or not. If you buy an index fund, you should do exactly what the market is doing. No better, no worse. You should exactly follow the market. I have some money in an index fund and I just looked at the ticker a minute ago and were right at 12% increase in value since the beginning of the year. This is the first of September. We're eight months in. Still got four months to go. September, October, November, December. We'll see what the total return is on the stock market and the S&P 500 index fund will be what the market does. If the market's down for the year, up to the year, then it follows that. A brokerage fund is opening an account with a broker, a financial advisor, and you can put mutual funds in it. You can put stock in it. You can put index funds in it. You can put anything in it and run it. When you buy a 401k or an IRA typically, and especially if you follow what we teach, you will be buying a mutual fund or funds inside your 401k. Your 401k is not an investment. It's how your mutual fund is taxed. If it's in a Roth IRA, it grows tax-free. If it's not, you get taxed on it as it grows or when you sell it, one of the two. That's the basics there. The good news is the market has done very, very well. It's setting records this year and last year. The last five years, it's just been phenomenal. Unusually good. It's not been down in a lot. It's permanently down for the year for in a long, long time. It's a great time to get in touch with a Ramsey Smart Vestor Pro at RamseySolutions.com and find someone that can teach you the stuff. I just taught you and show you some actual funds. Then you look at the fund. You understand it and only then do you buy it. Do not buy it because Jade said to Dave said to or because a Smart Vestor Pro said to. So what did I miss, Jade? Nothing other than the fact that you're going to be teaching all this at the investing essentials event. That's why I tossed it to you. Oh wow. That's true. Yeah, I guess I am. I'm teaching that tonight in more detail. It's not too late to get tickets. In more detail. It's only $199. We're going to do two and a half hours of what I just did in two two minutes. So that was that was a start. That was a primer though. We just went to kindergarten. And tonight we're going to go into graduate school. So I go a lot deeper into this. But that gives you the basics and gets you going. And Owen you're brilliant to ask this question because you never invest in something you don't understand. So you never do it just blindly because you heard about it somewhere else and you don't know what it is. That's how people lose all their money. So go slow and always have someone with a heart of a teacher, not the heart of a salesman that's helping guide you. And that'll be a big help. And right along the same track is Davis and Montgomery Alabama. Hi Davis, how are you? Hey, I'm doing pretty well. Nice to go to you all today. You too. What's up? So I have some investments and I met with my guy the other day and we were talking about the percentage. So I am earning probably he said it's about 6% trying to get it to 7%. And I hear you talk all the time about should be earning at least 10% in your retirement fund. What are you invested in? That's socks. Yeah. Well, that's what when I I thought about that when he showed me that percentage and I said, well, should it be 10% and he said, well, the market's going to get 10%. But you would never get 10% and I said, why? I kind of I don't know it. What are you and you're not invested in the market then? What do you buy? Do you know? I don't know. I know it was like 6040 6041. I couldn't tell you. I think you're in bonds. Yeah, it's probably. Yeah, I think he's got you two heavily in bonds and you're getting milked. You're getting destroyed. This guy doesn't know what he's doing. Get away from him for two reasons. One is his job. He failed. His job is for you to know what's going on. Yeah. Yeah. So you need to get it. You need to get a smart investor pro or somebody with a heart of a teacher. You need to know what's going on because you can't even tell me what you're putting money in. No, no, I can't. That's an epic fail on his part. He's a teacher, not a salesman. Yeah. And then he goes, well, yeah, you could make that much if you were in the market. How old are you, Davis? I'm 53. And why has he got you in bonds? That's dumber than crud. Well, I have reached out to one of the investor pros and they were, they were telling me pretty much the same thing they were saying you might be too heavily invested into something different. But I wanted to get your opinion on that because I, you know, I don't know because you don't know. But that's what it sounds like. So here's the deal. Again, I just mentioned that. I just looked it up a second ago. Year to date. We're up 12. Just January. If you were just in an S&P. Yeah. If you're beating the S&P, you'd be above that and a lot of my funds beat the S&P. Now, I've got some money in the S&P. Last year, it was up 18 for the year. The year before is up 25 for the year and the year before is up 26 for the year. Meanwhile, this bozos got you in bonds. Yeah. Six percent. I know. You're getting slaughtered. Yeah. That's what that's what I figure. Yeah. You need to, but here's the thing. The thing you violated, you can't do anymore after today. Never again, put a dime in anything, unless you tell me how it works and what it is and why you put it there. Not like my guy's not doing it. No, you're the guy. You got to take care of you by learning. We'll take care of you. We'll give you tickets to the Investing Essentials event tonight. You need it probably. And then get to it. Yeah, it's bad as anybody. 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They pair patients with a personal advocate, someone with an average of 16 years of healthcare experience, whose entire job is to fight for you so you get the care and honest answers you need. Solace is covered by insurance. They handle the paperwork, battle claims denials from the insurance companies, and make sure you're not getting lost in a system that was intentionally designed to be confusing. So, you and your loved ones can focus on getting well. With solace, you have someone who knows how to fight for you and who will. Go to solacehealth.com/ramse or click the link in the description to see if you qualify. It takes about 2 minutes. That's solacehealth.com/ramse must be 18 or older. Advocates do not provide medical or legal advice. If you're working the baby steps the best and fastest way to get out of debt and into wealth is using the Ramsey plan and it is built into every dollar. Every dollar is our budgeting app that has the plan built into it to track your progress, give you personalized recommendations and coaching for your particular situation. It's kind of like us having us in your back pocket on your phone and saying don't do that, do that, do that, do that, don't do that. Start with every dollar for free by downloading it in the app store or Google Play. Mike's in Chicago. Hey, Mike, welcome to the Ramsey show. Hi, Dave. Thanks for taking my call. Sure. What's up? You got a question. My wife and I are kind of in a disagreement. My son's 17-year-old his car just can't broke down for timing, Jane. And he's in the shop. She wants to buy, I'm tend to buy a new car. Well, not a huge car, but basically a car payments and in a disagreement, so a train of brainstorm. What the best path forward is. I think the problem happened about five years ago when you guys were not on the same page about borrowing money. Yes, we're still not on the same page. So, yeah. So you guys are still- So if you haven't been able to solve that in the last five years, how are we going to solve that in five minutes? Yeah. What's her argument for wanting to continue on with debt and what the conversations looked like? Well, the debt would be- Say it again, you cut out. Yeah. Yeah. He's 17 years old, so the debt would be on him. She just- Not really. A minor can't sign a contract. You're going to be on the debt. Oh, a minor cannot get a car payment. No. No. No. You go to the 18. Yeah, you're not an adult. You can't conduct business. But the bigger problem here is even if you were 18, it's problematic that she's teaching him to go into debt and that you have a completely opposite philosophy. It sounds like. Yes. So what happens next time the two of you want to buy a car? You're probably not giving in and getting a car to be honest. Well, there's part of the problem, I think. Okay. So I can't help you as long as you give in. Okay. Is this way and battle backwards? Yeah. I mean, the deal is you know not to borrow money on a car. You know it's not smart. You know it's not going to lead this young man where he wants to be. It's a burden on him. It fixes a temporary problem of a broken down car and gives him a permanent problem called car payments. And it's really, really dumb. And you should not be abusing your own child with a car payment. Don't do this parents to your kid. Now, why, you know, if your wife is dependent, if your wife is or your husband is out there, it is bound and determined to do something that's going to bring harm to your child. I don't give in. Yeah. I'm like, why are you afraid? Why are you afraid of pushing the issue? Why are you like no one doing this? Yeah, it's sometimes just maybe not worth the fight. Yeah. Okay. Well, then you're going to have a car payment because you're going to be a worse. So you can't be a worse man. You're going to stand up. And you know, it is worth the fight. It's your 17 year old son. You take him out in the middle of the traffic and go and dodge. Don't get hit by the 18 wheeler. You know, I'm going to walk him through the gauntlet and get the hell beat out of him because you can't tell your wife no. So no, this is worth the fight. Of course, it's worth the fight. So it because it matters because it's your child. You're bringing harm to your child by not standing up. So yeah, I got to tell you, me and the hillbilly wife, we would be having a knock down freaking drag out. It wouldn't go good. It wouldn't go good. We're not going to do things that bring harm to the children in my view. And uh. I'm not because I'm a bully and not because I'm overbearing, but also if I try to do something that's gonna bring harm to the children, she'd be all at me. She'd be all on my face like a raccoon. I mean, she'd be tearing up, tearing up my hair. What little of it was left? I mean, come on. - I'm right there with you. I would be fighting this battle all day long over and over and over and over and I'd be fighting it. - So, run down to Walmart and pick you up a backbone. They're on aisle four. That's what you're gonna have to do. You're gonna have to stand up and go, "No, we're not doing this. "We're not going live like this." And the worm has turned. I've put up with this crap for 10 years and I'm not putting up with it anymore. No, we're not gonna go in debt for a 17 year old to get a freaking car because it's time and belt went out. He goes and works six jobs and puts a time belt on the piece of crap car or he goes and gets him another piece of crap car for a thousand bucks and drives it. That's why 17 year olds have done since time began. And none of us died from it. I put two engines, three transmissions and changed the brakes on my car by the time I was 18 because I kept blowing 'em up because I was such a hot rod idiot. And guess what, every time I did that, my dad looked at me and goes, "You're an idiot. "Go fix it. "Deal with it, boy." And taught me to turn the wrench and taught me to quit driving a car like that. Blowing up everything. So, I mean, there's consequences to this stuff. So, yeah, no, no, that don't work, Mike. That don't work, man. Sorry. All right, sorry, I'm not sorry. Anthony's in New York City. Anthony, what's up? - Hey, what's going on, David? Jay, thanks for taking my call. - Sure. - How can we help? - So, one of the calls today, I'm 29 years old, by the way. I live in New York City, not even hand proper, thank God, but I discovered you guys a couple months ago. And my whole life, basically, my parents raised me to never have a single dime of that, of that to my name, right? They'll wash cars. - Can they call me? - That's the opposite, isn't it? - Can I get much number? - Yeah, white cow, man, did you say you're 21? - 29, 29, okay, cool. Good, all right, so you were raised well. - Good. - Raised well, but to that point, I also stayed home a little longer than I should have under the assumption that I was saving every dollar I made, which as the young kid in New York City with a lot of friends, I did not. And honestly, didn't start saving until I really got my first decent job at the 25, started putting a little bit away, but still was kind of spending my income not stocking all the way and being smart. - When you say stocking it all the way, how much of where you supposed to be stocking away that you didn't, like what was the standard? - Realistically, Jay, I probably could have been, at the time, I was probably making, from 25 to 28 years old, I was making maybe 80,000 and 85, 90,000 a year. - And how much should you have been saving? - I realistically probably could have saved 75 of it. And I did probably half of that. - Listen. - So how much money do you have now? So right now, my money spread all over the place, and I was getting there, so I have about 120,000 in brokerage and account that's tied between mutual funds and some general investing, but also a loss that I was doing just because that company at the time did not have a 401k. - What other money do you have? - So I've got at my current job, which I started last year, which has more than doubled my income from where I was at. I've got about 30,000 in that 401k plus about 16,000 in stock, and then just the $1,000 starter emergency fund. - So what is it that you're trying to do? Are you trying to get a place of your own and move out? What's your goal here? - Yeah, yeah. So the last bit of context is a year and a half ago, I was getting ready to get engaged. So I was engaged with very shopping, getting all excited and then I got broken up with because wasn't making enough. I was at a bed and job. - Anthony, what are you trying to do? - How can we help you today? - Hold on, hold on. So where I'm at now, moved out of my parents' house. I'm renting, paying $2,300 bucks a month, and it's a great apartment. It's a great little one bedroom, but at the same time, now I'm shopping around for either an apartment or a small entry-level house, right? - Okay. - And I've been following the baby steps. I've paid off all my debt in the last three, four months here, but any entry-level two bedroom condo in a decent area around here is between 450 and half a million bucks. - Then you can't live in that area with the income that you have. You just have to decide. You're trying, you can't live in Tokyo and Toronto and Los Angeles and San Jose either, by the way. (upbeat music) - 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. 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(upbeat music) (upbeat music) - Summer is in Canada, which sounds like an oxymoron to me, but what's up, how are you? (laughing) - Hi, I'm Good, how are you Dave? - Better than I deserve, how can I help? - No, so sorry, I'm getting nervous. I'm talking to my hero today. - So close. - Thank you. - So I got laid off last year for my full-time job and then I started my small business. And then I also started a new part-time job last year and I also got made last year and I'm kind of stuck knowing what to do next. My business grew from $6,000 last year to $20,000 this year. And I make about $22,000 from a top-time job. My husband and I have been talking about buying a house 'cause he's getting $100,000 inheritance soon. But I don't feel like I'm gonna get a qualified for a good mortgage when I'm only making about $30,000 by myself. So I'm stuck, that should I be closing everything down and moving into a full-time job or should I just continue going? 'Cause I have confidence that I can grow my business next year. - Why wouldn't you and your husband, you're newly married husband, why wouldn't you all combine finances together and buy the home together? - Yes, yes, that is a thing that I've been listening to you guys and I have been thinking it's, I think it's a need issue that I, the building that trust and also I'm nervous about how- - You don't trust the guy you just married? - No, no, no, it's me. I mean, it's a meeting, it's a meeting. I've had trust issues in the past. - Trust with who? - My father. - No, I mean, why do you have a trust issue, who's your trust issue with now on this subject? - It's me, me, be aware of the rule. - You should trust you, you have trouble trusting yourself? - Yes. I'm decent with money, I listen to you. - The facts are that you're bringing in 20 at one thing and 22 at the other, that's 42 and your husband makes how much? - He makes about 80 to 90,000 dollars. - The facts are that you have a $120,000 household income with a $100,000 inheritance to put down. Those are facts. - Yes. - Yes. - Okay, there's nothing, there's no distrust in any of that. That's just a fact. There's nothing to trust in, it's not an emotional thing at all. - Right. - Okay, now, do you have the ability to shut both of those things down and go and make a $80,000 at a job? - That is another thing, that's, I started my own business 'cause it was hard to get a new job. - No, I'm asking, can you go get a job, making $80,000 a year, yes or no? - Probably not, because I don't have school. - What did you use to make, what did you make at the job you lost? 55,000 55. Okay. Now you're making 42 It I'm after paying all this Yeah, the bills off for my for my work. I mean for my business I'm thinking yeah, business has to you have to operate on net profit on business not gross But yeah, I mean it's the 20 of the gross revenue or the net profit? net net, sorry, so gross growth Income and then net profit would be 11,000 dollars. Oh, you're not making anything. Oh Yes, you need to go get a job. Yeah Okay, yeah, cuz you can bring 55 or 60,000 dollars into the household and you're bringing 11 and then 22 at your part-time So you're bringing in 33 and you have the ability to bring in 55 And you've been working and you've been working as business two years. Yes. Yeah, it's not it's not growing fast Okay, okay, it needs to be needed to it didn't grow fast Enough to survive If you want to keep it as a side hustle you can it's a fine side hustle But it's not even a great side hustle if you're only making a thousand bucks a month I mean, it's okay. It depends on how much time it takes you to make that thousand bucks. What are you doing? What's the side? What's the business? I'm a living planner Okay, so you just not get minigakes a lot of time. You're not getting minigakes It sounds like it's too much time for the amount of money that you earn on it That's why I said it might not even be a great side hustle because a side hustle You just want to get in and get out and get your get your money, you know what I'm saying? So yeah, I think the key issue here If you're really talking about trying to buy a house if you're looking about looking at employment I agree with Dave you need to go somewhere and get a job Probably doing whatever skill you were doing when you were making 55,000 and when it comes to the house you guys You need to combine your money if you're standing here and looking at me saying Jade I know I have trust issues That means you've admitted it's an issue, which means you know you need to do the opposite of what the issue is if you know you have a trust issue That means at this point I need to do the opposite which means I need to trust my husband And I need to try something different. Let me try combining my finances It's the opposite of what I want to do, but I know what I want to do is an issue. You just said it. So let's do the opposite Yeah, yeah, we'll combine our finances. Here's the thing. I think I hear When you got fired it shook some of your confidence Oh, yes, I was And I'm telling you to go back in you're kind of like getting creeped out right now Let's tell you to go right back into the fire again. You're like oh god don't do oh let me keep the 11,000 where I'm safe And I want you to go be risky. Don't be safe It's not that risky by the way. You didn't die from it. They just fired you And so um that feels terrible for a lot of people it is like it's horrible. I've been fired It's not I'm not making fun, but I mean you kind of got to keep it in perspective though It's like you know, so what what's next? I mean I've been fired. Can you imagine the guy that fired me? What do you think? I'm doing now. I mean that's pretty interesting. You know what? So it's it's you just move on you go the next thing and go okay But what's good for our life and our life is for me to get back out there in the game again And that's great for our life and then if you want to keep the wedding plan or thing going as a side gig and try to grow it And someday maybe it gets so big it surpasses your full-time gig and you quit That's fine, but not for 11,000 dollars after two years. No, definitely not Good question. I appreciate you call. Thank you for joining us Robertson Toledo. Hey, Robert welcome to the Ramsey show Hello, thanks for taking my call. Sure. What's up? Um, so I'm wondering I'm 21 and I'm wondering about um employment retirement account I was I've been told that um Whether or not I choose like a Roth like a which I think is like a post-tax contribution or pre-tax Contribution it's all about personal preference No, it's not it's about math and you should only do a Roth Okay, because the Roth grows tax-free And when you got a million dollars in that account someday because you called the show today You're gonna have a million dollars without taxes if you do it pre-tax and you got a million dollars in there You're gonna have to pay taxes on the million dollars Which would be like three hundred thousand dollars. So this is not a matter of personal preference. One's dumb and one smart Okay, do do Roth it's a three hundred thousand dollar phone call you just made Because as young as you are you should have at least a million dollars in your retirement when you get there You might have three million in which case this is a million dollar phone call Yeah, if you have three million dollars in your traditional versus three million dollars in your Roth because you called this show today I saved you a million dollars and your ears will thank you Yeah America will thank you because you're a productive citizen You're not on the dole looking for universal income You're not trying to be a socialist because you are a capitalist and you went out there and produced something You left the cave killed something and drug it home good for you Way to go Robert. Way to go. Yes, always do Roth So the rule of thumb folks on your personal retirement accounts is take the match even if it's traditional first Up to the match Then do because a hundred percent red returns better than it's right tax for you. Okay, if you can do Roth and take a match Do Roth and take a match But if you can't then do traditional up to the match and then go do your Roth whether it's an individual Roth or otherwise So it's match beats Roth beats traditional. That's the math and it's not a matter of personal preference Isn't that interesting? He talked to somebody in HR Just a matter of personal preference. Oh, that's too bad. Yeah, you have to be careful who you're taking your advice from Yeah, who's giving you the who's giving you the math coaching here? Yeah, someone who didn't know the broke lady with $80,000 in debt and and student loan debt in HR Yeah, it's a matter of personal preference I can't tell you anything because I'm an HR and we're not allowed to have opinions here Corporate HR you got to help you people No Robert we just saved you a million dollars and you know what we didn't charge you a dime. It's pretty cool This is the Ramsey show As 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 net sweet net sweet brings your financials Inventory CRM and more together in one place more than 44,000 businesses run on net sweet including Ramsey And now they're taking the next step with net sweet next making it easier to put AI to work across your entire business Net sweet next helps you make the most of your time Automating routine work like forecasting demand and following up on overdue accounts with net sweet 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 net sweet next for free If your revenue is at least seven figures go to net sweet.ai/ramsey that's net sweet.ai/ramsey Welcome back to the Ramsey show in the fair winds credit union studio Jade wash all Ramsey personality is my co-host today Cameron is in Athens, Georgia. Hi, Cameron. How are you? I'm doing well. Thanks for having me on sure. What's up? Well Me and my girlfriend are looking to get married in the near future. Okay, congratulations Thank you We're looking Excuse me. We are completely on board with combining finances like you recommend But I was wondering is it okay for each of us To also have our own small savings account not that either of us couldn't have access to the other But in order to let's say if I want to buy her a nice piece of jewelry Um, and I want to save up for that rather than it coming out of our joint savings account would that be okay? If I want to save up for an expensive truck part and don't want to take that out of our joint savings Oh now we get to it. You led with the jewelry, but you're going with the Right, right. This is this is a fun money. It's really a fun money conversation I think because what you'd essentially be doing is saying okay, like whatever my line item is for fun I'm taking that and I'm kind of putting it aside and stacking it up and until I get the thing that I really want to buy, right? How expensive is a truck part? I don't have enough. I know. Give me an example. You got something in your head They caused that to come up, but give me an example. Is that a $2,000 item or $20,000 item? 700 bucks. How expensive is this jewelry? We're going to surprise her with in our in our hypothetical discussion here $1,000 good. Okay, so at our house what we would do Is Dave has an account called Jim gas entertainment and miscellaneous Okay, and I'm generally walking around with more than that my wallet. Okay. And so if I want to buy her a thousand dollar item as a surprise out of my miscellaneous money and it builds up sometimes because I don't use it it gets a little bigger and I just stick a little of it in the gun safe you know and sometimes it gets a little smaller but it's just Dave's bun money and it's just but it's laying around and cash honestly in my case. In my case and so but it's not it's not a $20,000 item it's I don't want to look around that in my pocket but but I mean at any given moment I've usually got a thousand bucks in there and I have for years it's kind of a redneck emergency fund to have ten one hundred in your pocket right and so once we got up out of being you know once we've been working the system for several years Cameron that's kind of where we got to is we have one little line item called I paid my gas out of that my entertainment my miscellaneous and I don't have much of any of that truthfully that we aren't doing together that's on some other line item so you know the Dave's personal entertainment is fairly low I'm fairly boring so okay well you know you just build it'll build it's like you're a little personal your low personal miscellaneous account and let that build up and cover those things in cash and again if it gets to be three thousand bucks and you don't want that in your pocket stick a little in an envelope and sit in the gun safe okay that makes perfect sense yeah good question I appreciate sometimes if you look at the amount folks on something like this it frees you up from putting together some big system for something because it's like you know I need twenty-three dollars okay well then don't open an account just keep it just keep it where you can get your hands on it and that kind of stuff so yeah that's a good question and here's the thing listen to what he's doing we're gonna get married soon and yet set a date they're getting ready to he's getting ready set the day he's gonna rip up the question he's trying to figure out how to be a good husband yeah what a good guy what a good guy yeah I want to I want to be able to pay cash from my truck parts and that cause problems with the family oh and get her some jewelry too yeah Duke is in Knoxville what's up Duke what's up very well better than we deserve how can we help um I just I had a quick question um I have money sitting in my 401k that's more than baby step one but I got a lot of that from school um what what you see where I'm where I'm going yeah how much is in the 401k it's not much I've only had this job for six months how much is in the 401k 2800 maybe 2800 yeah it's not a lot okay I got you okay and how much is your debt so 64k roughly and that's student loans yeah and and what's your income sir it's uh there's a bonus it's not always the same okay roughly what do you make I mean give me an idea you make it ten or twenty eighty hundred uh sixty a year okay all right good for you what do you do uh medical device sales good for you oh that's a good job you're gonna be doing great okay yeah I would just leave that whatever's in the 401k alone that 2800 is not going to change your world today it's invested I leave it invested but I would just work the baby steps from baby step one on up with your income is it just you or is there anybody else wife or anything like that I don't have a wife I have a girlfriend um I believe it's it's getting pretty serious though here in the next couple months okay what we teach is to stop your investing so no more 401k for right now and then instead let's start the first thing you do squeeze out of your 60 grand you don't go out to eat and you don't go to happy hour and you put a thousand dollars in a little you just put it in cash if you want to in your underwear do I don't care this month you should be able to do that here instead of yeah and just set that aside and that's your baby step one and then baby step two is we're gonna start attacking these student loans and that's gonna take a hot minute yeah yeah and so if you go sell a bunch of devices and get above your 60 you may double your income if you have a great year in sales that's the good thing is the 60s your base but when booze surprised me you make 120 in that world right yeah I I'm going to associate and so I don't the commission is just if I do my job and to set rate that that next step of you know getting paid off of doing good work doesn't really come until um I have my own territory what is that it is um I they said 12 to 18 months perfect good good I'll put your nose down and and get you get to work man and and earn that other territory because this is a good field you're in we work with a lot of medical device people making quarter million so that's where you could be headed okay that's why I was saying it's a good feel but what it amounts to is you're in the apprenticeship stage and you're in there to support the other salesperson he or she and you get in there and you learn the business you learn how to interact with the docs and the surgeons you interact with the hospitals and learn how to do the skill that takes you to serious business that that be field I mean I don't know which device you're selling but medical device field is an excellent sales field but it's all of people skills and it's working with the docs and sometimes they're tough to work with and so um you know in the nurses and whoever else is involved in deciding which company we're going to do the device with but he has a major upside if he can keep working it but in the meantime you could still pick up a side hustle you could still pick up other things to do in the meantime if it's just you you don't have kids you don't have a wife I'd be working day and night yep I would I agree and uh double your income that way and uh while you're waiting on this while you're waiting on your ship to come in but yeah stop your retirement stop investing in retirement temporarily that's what we teach while we get you out of that and here's the thing if two years from now you're dead free and you're making sure and you're making a hundred fifty two hundred you're on your way to being a multi-millionaire then Duke so that's where you're headed you can't think short term about this stuff you have to think long term is the price I'm paying now going to be worth it five years from now and the answer is yes hey guys George Campbell here do you ever feel like insurance companies only care about your money and not what you actually need well there's a better way when you go to Ramsey's insurance resource hub you'll start feeling confident that you're getting the right coverage that's truly best for you you'll find helpful info on everything from life insurance health insurance identity theft protection and more and when you're ready to get the coverage you need you can connect with a ramsey trusted insurance pro who will only get you what you need at the best price go to ramsey solutions dot com slash insurance ramsey solutions dot com slash insurance well we wish we could get to every call on the show but we can't and so we took a bunch of years of answers on this show all the stuff we've ever written in articles and books and dumped it into a data set called AI and we have a thing called ask Ramsey that answers questions only from that data set so you get no filth from tic tac you only get Ramsey answers so if you want to know what Ramsey thinks you're going to get an answer just like on this show completely free it's trained on proven ramsey principles and you have to train AI because it is artificial after all ask your question today at ramsey solutions dot com it's free or click the link in the description if you're listening on podcast 150,000 people a month are asking ramsey for free that's kind of wild y'all and it's going up every month it used to be like 10,000 a month and it's blowing up you guys are using it so we're glad it's there to help you let people know that they can ask Ramsey Sarah is in Philadelphia hi Sarah what's up yes hi guys thank you so much for taking my call huge fan sure how can we help yet still have two questions so I'll be brief my first one is um you must have super close we decided to buy a house together about a year ago we both had a certain credit you know good saving the house is holding my name um because we didn't have credit we're going to buy another house it's hurt with her credit but at the moment we're having issues um she has a boyfriend they're engaged after a couple of months I didn't agree with this so now I'm the bad sister and it's just like um where do we go from here do you you don't agree with a boyfriend what we are engaged at the moment um you don't think it's like season two not three months they're got engaged I have reservations on him just about opinion she don't like it um your your phone is awful can you speak more directly into your phone it's all muffled yes can you hear me now yes that's a little better okay okay sorry yes um she acts for my opinion on it and um I gave my opinion she don't like it for nothing their awkward at home okay but um no nothing with the people at home and I'm just considering it's a time you know um she doesn't want to talk about anything sure do we should I write it out should I you know we can sort of put into house uh It's in your name. She's the roommate, right? She's just renting a room in your house. Yes. But we both went half on the deposit for buying the house. The down payment for the house. How much? How much each? I would say each maybe like 30k. 30k each. And what was you guys' agreement when she moves out? Does she just get the 30? Or does she think that she is entitled to any other bit of equity that made her agree? I'm sure you didn't write anything down. Did you? No, it was verbal. So the agreement was we would still, you know, pay half of the other portion of one move down until we either throw the property or until one got a roommate. So you can't afford the property. You can't afford the mortgage if she moves out. I can. I just wouldn't want to because it will take up a chunk of money. That means you can't afford it. That would mean you can't afford it. Okay. Okay. Shall it. Okay. There's a bad plan. There's a bad plan. Okay. Now, let me say this. I think the way you do this does matter. If you, she says, "Hey, what do you think about Ken?" And you say, "I don't like your boyfriend, Ken." And then you say, "Well, that's it." You're kicked out of the house, right? That doesn't go well. So I think that there's a way that you can not do this throwing a hissy fit, right? She's, I mean, she can marry whoever she wants to marry. She's a grown woman. Yeah. I mean, that's not the point. The point is, okay, look, we're not getting along. And so it's not good for us to own this house together anymore. So let's get it sold. That's all you have to say. You don't have to talk about Ken. Okay. You don't do putting it up for rent. Would be a better option. Why not? It's not a better option. You still own it with somebody that you don't like and it's like mad at you. Well, I did it. I own it by myself. She got on the deal. Right, but you can't, you can't afford it. I know, but you own it because you did a deal, a handshake deal that said you own it together and she gets her money back out. So you can't just put it up for rent and cut her out. Yeah, you got to get, you got to undo this deal because you guys aren't getting along because you shouldn't have been in this deal in the first place because you guys might not have been getting along. Did Ken move into your house? I hope not. I hope not. He doesn't, he hasn't moved in, but he's 30 very good amount of time. He's always there. Okay, I see what's going on here. Yeah. That's what I was afraid of. All right. Yeah, it's time to get the house sold. Yeah, let's let's just talk about. Okay, guys, you guys, it looks like you guys are moving on with your life. I'm going to move on with my life. And so real good time. Realtors coming over. We're going to put the house on the market. Sister, you're going to get half or whatever we get out of this. Yeah, at closing because you put in half of it and I'll be signing all the papers and you guys have a good life. And love you. Listen, what I would do is if you sell all that doesn't matter, you called us and said this situation sucks. So don't stay in it regardless of how you got here. And if you sell it and you make a profit, split the profit too. Split it, you guys split it down the middle, you split the rent, you split the down payment. If there's profit, split the profit. Yeah. That was your deal, wasn't it? Yeah. Yeah. Well, you did a dumb deal and now you've got to undo the dumb deal. Buying a house with your sister when you are not aligned on how life works is a dumb idea. And so you got yourself into a barrel of fish hooks here and the best thing to do is dump the barrel out and get out of it as fast as you can. That's going to be the best thing for your money. It's going to be the best thing for your peace of mind. And it's actually going to be the best thing for your relationship with your sister. I agree. Yeah. Because now she feels like she's like the house is in your name and her boyfriend's over there all the time and there's all this tension in the air. But when the house is sold and you know, they got to go do their own apartment and you do your own situation and everybody will be okay. And all of a sudden 10 years later, you might like Ken. Who knows? That's why I said don't do it with drama because if you just look at it and say to her, it looks like you guys are getting ready to go into a new phase of life. This is the perfect time. Let you go do that. Yeah. That way it doesn't mess with your relationship further. Yeah. Instead of like, I got to sell the house because I hate your boyfriend. That's not the reason it's just this is a bad idea when we did it. And it looks like you guys need to do your thing and we're going to let you and I'm going to go do mine and everybody's cool. It's all good. It's all good. No problems. And you know, you don't have to get into trying to fix her life, which is where you got into trouble. Yeah. As soon as you start telling her who she could date, that's a problem for her. I wonder why? Strange. Okay. Yeah. I mean, that's. She don't like it. That's fun. Matthew's in Charlotte, North Carolina. Hey Matthew, what's up? Hey Dave, how's it going? That of the not deserve. How can I help? Good deal. So, um, well, my question mostly is what to do with all this extra money that I've kind of came across. So long story short, my wife and I are in baby step four now recently and that happened by pan off suit loans. I finished off paying a car and another good news. My wife actually just landed a great new job where she's getting like a 32% increase on her face. Wow. And uh, uh, also within the next couple of weeks, I'm getting a promotion to director. Absolutely. That life is good on Matthew's planet. It is. Well, with some bad news. Um, I feel like I'm a little bit behind in my retirement. So, um, 35 years old. And I don't think you're behind it. I think you're okay. You're okay. So what will you be making in your new position? Um, about 110. And what will she be making it with her 32% raise? She is going to be up to about 85. Okay. So we have a 200 and we have a 200 and something thousand dollar household income give or take. Okay. I think we can prosper at 35 and retire a multi-millionaire. Okay. I hope so. If you were to invest, um, 15% of that because you're debt free except the house right now. Is that what you told me? Yeah, correct. Okay. So that puts you baby step four. If you're to invest 15% of that, that'd be $30,000. About $2,500 a month going in from age 35 to age 65 is going to be a bunch of money. Jade's going to put it in the calculator for us. So you're, you're just fine. So you want to do Roth 401K at your place and at her place first. Get the match if you can. And so Roth match beats Roth beats traditional. And if you need some help, go on to a smart investor pro at Ramsey. Jade put that in the calculator that'll be $5.2 million. If you never get a raise and you only invest 15% from age 35 to 65, I think you're going to be okay. Dave Ramsey here for more than 30 years. I've been talking to folks on the air and I can tell you that most people are broke, not because they don't make enough money but because they don't have a plan. You need to give every dollar you earn a job because when you do that, something changes. You stop guessing. You stop worrying. You stop stressing. Our every dollar budgeting app will show you how to find extra cash pay off debt and finally start winning with money. But most people won't do it. They'll keep living paycheck to paycheck. Keep hoping things will change without making a change. It's time to say, enough is enough. It's time to take control of your money. It's time to start your every dollar budget for free today. Go download it in the App Store or Google Play. Seth is in Portland, Oregon. Hey, Seth, how are you? What's bad? How you doing? What's up? I was thinking that I can get out of this debt I got on one income with a married sub. Well, wife can't work. She's pretty much basically disabled. Just trying to get some ideas on how to attack this and then also get to a good retirement. So how much debt do you have, Seth? I got just about $34,000 on what? 23,000 student loans. You got two car loans. What do you owe on the cars? Break them down. You can thousand on my truck and 15 on my wife's car and then 13,000 credit cards. Just gotcha. So you're kind of normal. Only normal socks, right? Yeah, this gotcha. And what's your income? What do you make? About 65,000. 65? What do you do? I'd make build helicopters. Cool. Good for you. Okay, civilian side are you in the military? Well, we do both actually, but you're civilian. Yeah. Okay. And what's the nature of your wife's disability, sir? Well, for the last eight years, we've been trying to figure out exactly what it is, but it's really hard for her to walk and stand, and her balance is really off. So, you've got a, the other plan is also to move probably in Arizona, because we have better care over there for neurologists and better opportunity for her to actually get help. What would your career be in Arizona? Probably the same thing, aerospace. So, you think you can land a job there before you all go? Oh, yeah. I've done a little dry run, and just a couple of people that wanted to hire me, but I'm just not down there. So, once you get down here, you're good to go. No, no, no, no, no, no, no. You need a job offer before you walk away from the current job that you have, because you're the only thing eating, feeding your family. Yeah, that is the plan that's going to happen. Yeah, but then come on down and then we'll hire you. You come on down and then they don't hire you. You're screwed. Aside from landing the job, what other things are you waiting on to make that move? Well, I need if you see some money to get down there. Yeah, this is moving costs money. Has she applied for and received permanent disability? Is she getting SSI? I see it applies. We're just waiting on the eight years. Let me call back. No, well, we started it about a year ago because it started getting worse and worse. The last year and a half, it just got it, you know, where you can, that's trips over anything. And when it's cold, especially that's the other reason. But you've gotten a doctor. You've gotten a doctor's write-up to be able to send to the Social Security Department to be able to get her own SSI. And you've done that, right? Yes and no, because I've been neurologist here. They leave all the time. You know, we get one and she gets unemployment and then all of a sudden they're gone. They leave because I don't know what's up with the organ but they just have issues keeping neurologists. Okay, because that income, that SSI income will probably be three or four thousand dollars a month or it might be very helpful. Right. And so it's very important that you follow through and get that income coming in. If she's not able to work, that's a legitimate thing to get and get going. Regardless of your location, you need to push that on through. And so if you have to chase a neurologist around the state and tackle them, then let's do that and get these letters and get these forms filled out and get this done. It's very important. Is she able to drive? Yes, she's able to drive. You can't lift anything. Her balance just goes right to. Are you sure she's safe driving? Yeah, I mean, I'm just looking at these, or maybe she can, but maybe she doesn't drive much because I'm just looking at these cars thinking, gosh, I wonder if you need both of them. Why should you get 15,000 on a car destination in the driveway with this disability, yeah? She can drive, you know, not problems. Like, we've got an X-ray on her. And they said that she has, like, right where this attic is in the L5, this is basically, like, a little. There's a muscle and nerve tear and also, like, this little disc degeneration. Yeah, I'm sorry. You guys have been through a lot, man. Yeah, yeah. So, yes, what I would do, though, is I think you've kind of been sitting in the middle and limbo. And so, if I'm going to do anything, if I'm in your shoes, start taking some action. So, I think it's time to move to Arizona. Matter of fact, you're a year late. So, you need to call up, go down there, interview, get a job, and load it. Get your friends to load you up and help you drive up down there. So, it doesn't cost you much out of pocket. And just get your stuff down there and get your new job started. And let's get her landed down there and get a neurologist there and get, you know, get her disability signed up. Decide whether or not she really needs to keep a 15,000-dollar car debt in the driveway or not. In this situation, I doubt she's driving. She's not driving. I doubt she's out driving around much. It doesn't sound like. And then you begin to work as, like Jade said, every extra job, every piece of overtime you can. And you work like a maniac. You get her income coming in from disability. And between those two things added to your new job of 65,000 or more, maybe it's more in Arizona, then we start working these debts off. But the problem is you've been kind of hovering around the edges of everything because of the pain she's been in. And because that medical problem has just got you all per-- Yeah. You got your own hold. You know? And so we have to get turned loose here. And you're just going to have bus loose. So it sounds like you said the cold is a problem. The care is a problem in that area. And you've got a good lead there in Arizona. If I'm you, I'm going to wrap that up next couple of weeks and be in Arizona and about by the end of the month. And having an apartment there, get this one sold, call the landlord, get out of this lease, or whatever it is. Let's get moving and get this done. If I'm you, that's what I'm doing. Monica's in Atlanta. Hey, Monica, how are you? I'm good. How are you? What's up? Good. I'll give you a little story here. I'm married. I'm 50. My husband's 54 years old. We have four kids. Two are in college and set to live good, financialized. Good. My question comes into play that we have a fourth child, who is nine years old, that we adopted with special needs, who will not be able to provide for himself in the future. He will live on SSI and Medicaid. We did set up a third party trust and special needs. Trust for him just within the last month. That lawyer advised us to look into whole life insurance, because her thought process is that when we leave, our son will need a large lump sum of money to live off. And that lawyer is an idiot. The older son will most likely take care of him. That lawyer should stick to practicing law. That's horrible advice. I know. It's horrible advice. Do you want to know what the real answer is? That's what I'm calling you. Because this is horrible advice. And don't take any more financial advice from this lawyer. They're moronic on financial things. Or their brother-in-law sells whole life one of the two. Now, by term life. And name the trust as a secondary beneficiary. You're the beneficiary. If he dies, he's the beneficiary. If you die, and the secondary beneficiary, if both of you die, which is all we're concerned about, is the trust. And it goes into trust, and then you name that the trust goes into good mutual funds. What's the child need to survive a month income-wise? Right now he's nine. No, I mean, I mean, into his adulthood when you're not here anymore. Into the adulthood? Well, tell me to, tell me to caregiver, tell me. Yeah, five thousand, eight thousand a month? Sure. Okay, eight thousand a month is seventy-thousand dollars a year. That means there need to be a million dollars in there. Seven hundred and a million dollars in there. So go buy a million dollar term life policy until you can put a million dollars where the mutual funds in there is your death. But don't buy whole life for anything ever. It's a horrible product. Way too expensive, and it does not accomplish your goals. You shouldn't feel uncertain about investing and you don't have to. At investing essentials, our two-night virtual event, George Camel and I will walk you through my playbook for investing in wealth planning. We'll simplify everything from 401k's and mutual funds to passing on wealth. It's happening now, September 1st and 2nd. Tickets start at 199. Grab yours today and lock in full replay access at RamseySolutions.com/events or by clicking the link in the show notes. Our scripture today is Psalm 77.14. You are the God who performs miracles. You display your power among the peoples. Peter Marshall said, "When we long for life without difficulties, remind us that Oaks grow strong in contrary wins. And diamonds are made under pressure. Lynn is in Dallas. Hi Lynn, welcome to the Ramsey show. Hi Dave, thank you so much. Sure, what's up? Well, I have a question about a consolidation loan. I want to give you an answer to that. I'm really embarrassed to even talk about this because I know that I was stupid in doing it. I get it out of fear. And, you know, I've been here before and I know the Lord takes care of things, but I mean, just it overcame me because of a lot of trauma in the last four years. Anyway, I retired medical in October of last year. I was working out of pathology and I retired because the job had gotten so much that I couldn't handle it. I'm 77 and I just, I just had never believed in retiring. I've always done something inside of this was going. But I got fraughted four years ago and it took me a while to recover from that. It was about $25,000 company representing themselves as Amazon and over $5 million worth of ID insurance. They ruled it as fraught and not ID theft and so none of it was covered. And when I muddled through all of that and got over it, I had no credit card debt. Everything was cool and I ended up this year not having a lot. And I was living off of the income from the medical, which was last year on my taxes, I made $25,000. When I retired in October, I was dealing with some medical things that they couldn't put a finger on. But I was healthy on my blood panels were good. In February, I was taken to the hospital by ambulance and they thought that I was having a stroke and I was gone. I mean, in my mind, I couldn't see, I didn't know where it was and they found out it was a new TI. It took me, it has taken me quite a while to get over this and it was brain fog. And they said, this is normal and I've been doing everything. All of my numbers came back and everything's good. But I've been a little fuzzy and I have a phone professionally for years on the side. I do high-end wedding dresses and men's suits and all kinds of things like that stuff that most alteration specialist won't even touch. And so my business here has been growing. Your alteration business has been growing? Yes. How much are you making at the alteration business? Right now, because of the business I lost, last year with the alterations and another side hustle I had, that alone was $12,000. And of course, I had such a security for a long time and I had another little thing coming in. So what's the debt consolidation loan for? Okay, just recently, I put $5,000 on a credit card to finish a website that I am doing for holistic products, organic, holistic supplemental type things. And it just went live the last couple of days, but it's taken much longer to get through the setup of that business. So you've opened up another business? You have an alterations business and now you have an alternative medicine business. Yes. How much did you spend to do that? 5,000 she said. Okay, 5,000 anymore than that. And you want to get a debt consolidation loan for $5,000? No, I have the other, I have a total of just under 20,000 in debt. That's all that debt I have. And you have no worries? Yes. That's true. I bring in about 2,500 a month. That's over the last three months because I had after the hospital trip in February, it slowed me down. I didn't lose the business that I could not do it. I didn't lose clients, so far. And all of that has come back up. I want you to work on one business, not four. You're 77, you've had all kinds of medical issues. The last thing you need is trying to run four directions at one time. And the second thing is never again for the rest of your life be so urgent to do something in business that you force yourself to borrow money. Slow down and got let God provide you the money to build a website for a business that you might not have even should have been in. You might have should have been just working on the operation side. But I don't want to open anything else. You've got too much going on now to do it all well. And no debt consolidation is not your issue, income is your issue. And so anything we can do with either one of these businesses to get them moving without borrowing money like working like as much as you possibly have the energy to do on one or the other or both to create income. And then just really dialing down your budget and just begin to pay these cards off and land pleased. Don't ever pick up one of them again. Just see my face in your mind saying I don't want my friend to lend in debt anymore. It's not good for you. It's making these medical problems worse. The stress it goes with it you don't need with everything else that's going on. You need to clear this and a debt consolidation loan doesn't get you out of it. It just moves it around. And the P is still under one of the shells. So cut the cards up. List them smallest to largest call each of the card companies and ask for reduction and interest rates and then begin to work them off smallest to largest living on nothing and doing anything you can with either one of these businesses to get your income up to attack this with. And that becomes your new focus and leaning into that and it sounds like you've been thrown off a lot. So I sure hope that you can turn that around but borrowing your way out of debt does not work. So no that consolidation. It's mythology. It makes you feel like you did something and you didn't. Yeah, I also find that when you have individual debt psychologically, I mean it's like we teach it's nice to have them list them smallest to largest. You can see them go away. You check off the boxes one at a time versus one giant debt that you have to kind of tear into. And you know if you have if any time you do something regardless of if you're 17 or 77 and it causes you to feel shame, that's an indicator to never do that again. That's good. And so I've done stuff that I look back and I go, Cali, how dumb is Dave, you know, and I feel shame. I feel convicted. I feel condemned by the action. Why would I then I'm never going to repeat that action and in this case it's credit card debt and and so you know if you're going to grow your business, grow it more slowly and with cash. You have enough to eat and you have enough to pay your lights and this is what matters past that we're just trying to build an estate and trying to get things going. And so keep things in order here. Good question. I'm sorry you're going through that. It sounds like it's a lot. Sounds like it's a lot. So I couldn't tell in her situation without and I don't know if we didn't have time to get into it. It sounded like she lost five million dollars. 25,000 I thought is what she said to a company pretending to be Amazon. Yeah, or something. Maybe that's all it was. Okay, thank God. 25,000 identity theft and fraud and everything else involved some kind of a con. And so you've got to be very, very careful there. But the thing is just move slowly with these kinds of things and double and triple check them. And it folks and it keeps you from getting bit by one of these fraudsters that are out there. There's a lot out there now. Good time to check out zanders. I de theft insurance too and make sure you have that in place in case there's some kind of an identity issue going on. Didn't sound like that was hers though. That puts us out of the Ramsey show in the books. We'll be back with you before you know it in the meantime. Remember there's ultimately only one way to financial peace and that's to walk daily with the Prince of Peace. Christ Jesus. [Music]