Slow Money Moves Still Matter

Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broke and common sense is weird, so we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union Studio, this is the Ramsey Show. I am Rachel Cruz hosting this hour with my good friend, a co-host of Smart Money at the Hour, George Kamel. We'll be answering your questions, so give us a call at AAA8255225 and we're going to talk about your life and your money. All right. First up, we have Amanda in Portland, Oregon. Hi, Amanda. Welcome to the show. Hi. Are you doing? I'm okay. I'm nervous. I've never done this before, so yeah. I'm refreshing it so far. You're doing great, Amanda, you're doing great. How can we help? I guess I'm trying to gain an outside perspective on if my opinion on hiring an outside exterminator is warranted or is justified because me and my fiance have different opinions on that. Okay. Well, George is not the rodent's kind of fella over here, so I mean, who's a rodent fella? That's a weird thing to be able to see when what needs to be exterminated. Well, I guess we've just been doing with the rodent issue, our house is kind of old. It's been, you know, on and off for a few years now. I am a state home mom, so I deal with it. Well, you know, like if I see one, what's the one? What is it? Oh, a rat, a rat, a mouse, it's gotten into our pantry, it's eaten through our food. When you say it's, I'm guessing there's more than no, there's usually just one, right? Is it the same guy? Uh, it's, it's spursed out. So like I trapped one in our closet at the beginning of the year, it escaped. We patched up a hole we found. Now one is back. I haven't seen it. My fiance has it chewed through our pantry. We took everything out. There's a destructive, like you'll get behind your dishwasher and like chew cord. I mean, I know, and so we have a small child. And so my anxiety through the roof, because I don't want our child to get sick. I don't want our child to get bit. They're young enough where they think it's fun, like, oh, I want to play with the mouse. And I'm like, no, you don't, you scream and run. So I, my anxiety through the roof about it, I would feel better hiring someone to find holes, figure out where they're coming in, create a better plan. And I know it can be expensive. So that, like, that's reasonable on my fiance's part. But he feels like what are they going to do that we can't do? But I feel like all of our resources weren't really working, like the sticky traps, snap traps, uh, rat poison. We did actually just catch a rat this morning. Um, but it's definitely, I feel like put a strain on us. So it's made me feel very like distant and like, my anxieties aren't being heard. So it's just like, like, I've kind of been like, don't talk to me about it. Don't. Okay. He's getting dismissive with you. Sorry. Okay. He's tired of talking about it. He doesn't want to pay for it. So he's like, I'll, we'll deal with it. We'll figure it out. It's going to be fine. And you're like, it's not fine. Yeah. And it's like, it's understandable, like, the finance aspect, they understand. But it's, how much does it cost with a rat? Like, yeah, yeah, and it's, you know, like, I'm, is it a thousand dollars? Oh, you know, I was looking up, uh, like estimates, and it was saying, maybe like 350 in our area might be like the highest, but I think it could be less than that. I mean, I mean, no, okay. So from his side of the fence, are you guys financially in a good spot? Do you have money that you were like, yeah, we can write a check. I mean, we have like, we have cash in a safe, but like, we could use, but then there's like, you know, this is on the list of a million other things that need to be repaired or fixed or, you know, so then there's that, like, what does that money go towards first? Like, how much money do you guys have to remove, I mean, I, I mean, same thing girl. So we have a thousand dollars saved in cash, we don't, uh, I wrote all this down. Sorry. We have a thousand dollars saved in cash. Uh, we own our house, we own our cars, um, we do pay rent on the land. So there's that, and we have more, like, roughly three grand in debt just from like, just credit cards combined. This is all combined. Okay. So your total consumer debt is $3,000? Mm-hmm. Okay. How much does he make? Uh, $3,800 a month, it kind of fluctuates. Okay. So I think though, I think the real problem, I mean, obviously the rat is the real problem. So we'll give, we'll give him that, that standing. The issue to me, Amanda, is, is there's a $350 swing of you not feeling justified and heard and valued and what's important to you in this moment? And your fiance is dismissive, I mean, I don't want to put words in this might be little, like, he, it is, it's affected your relationship is what you said. Like, you're sure the rats give you anxiety, but ultimately you're living in a household that you don't feel like you get a vote. Mm-hmm. Is he the same way with the other repairs in the house where he's like, "Dah, I'll deal with it. I don't want to pay someone. I'll get around to it." It's not that big of a deal. I mean, some of it, yeah, but, I mean, yeah, yeah. And there's like a point where like, 'cause I, he's very handy, he can work on cars. He can build things, you know what I mean? Like, he's a real truth. He can do all sorts of stuff, but it's kind of like, okay, well, when, when are we gonna, you know, like get around to it? It's a lot of talk. Yeah. Yeah, yeah. Or it's like to the point where, you know, until it's like, okay, now we really have to, 'cause this is happening with the car now, where now we really need to repair this, 'cause this is falling apart, or, you know, so I think we're coming up. Yeah. Yeah. Okay, so no, no, no, no. I feel like the discussion needs to be had of the bigger picture of, there's a, I don't want to throw this word out 'cause I feel like it's overly used, but like, you, it's almost like, you don't, you don't feel safe because we have to wait till something is an urgent emergency to have any attention towards it, and you want a life that is, you know, somewhat well-kept, but that you feel like he's taking care of things, and when that's being removed, it starts to kind of shake this, this safety feeling that you have in general, right? It's more of a pattern, it's not this one thing, even though this is bright. Would you agree? Mm-hmm. Yeah? Sorry. No, it's okay. What, what, what makes that, why is that emotional for you? Is that, um, I mean, yeah, it's just, I'm, I'm a warrior, I stress a lot, go, go play, please. Sorry, my toddler, um, I'm a warrior, I stress a lot, and so just, like, even he brought up the other day, um, upgrading my engagement ring is paid off, go play, um, and I was just kind of like, I, like, what, like, are you serious? Like, why, how can you bring that up when, like, there's a million other things on our list that need to get done, you know what I mean? Um, so it was just, like, and then he kind of got, uh, sad that, or like upset that I, like, dismissed that thing so quickly, and I get it, like, he was trying to be sweet and wanted to do something nice. But if he's trying to be sweet, he should value the things that you currently value? Which is fixing these issues that are not wants their needs at this point. So you guys need to have a real conversation about what this relationship looks like, what the commitment looks like. I mean, I don't know how long you guys have been on the fence here, but we need to start really combining our lives and our shared goals and values. And let's start with the rat and let's spend 300 bucks to remedy this thing before it turns into a bigger issue. [MUSIC] When it comes to your health insurance, one of the biggest mistakes you can make is believing your stuck in a one-size-fits-all plan that costs too much and covers too little. That's why I recommend health trust financial. They're the only Ramsey trusted health insurance partner because their advisors take the time to understand your situation and help you explore the coverage options that are available to you, whether you've changed jobs, welcomed a new baby, or had some other life event, health trust financial shops, multiple top rated insurance carriers for you. Then they help you understand your options so you can make a smart decision instead of guessing. I've recommended health trust financial for more than 20 years because they work for you, not the insurance companies, so they offer unbiased advice. Visit healthtrustfinancial.com to connect with an advisor today. That's healthtrustfinancial.com. (upbeat music) - Next step, we have Jessica in New York City. Hi, Jessica, welcome to the show. Jessica, are you there? - Hi, how are you? - Hi, good. Welcome, welcome, how can we help? - Thank you, so I recently lost my job just on Tuesday and later my career went down. So, my other three started from scratch. I've always had like an entrepreneurship like once. And so I don't think I'm ready to go back to the workforce. I think I'm ready to start my own business, maybe acquiring a business or really maybe getting into real estate, maybe buying a property. I just need some guidance as to what's most profitable. Are you independently wealthy? Do you not need income? - Oh, I need guidance and you're gonna hopefully help me with some of it. I don't know. - Okay. - I'm just wondering, do you have money right now to cover the bills? - Yeah, like what are you gonna do when rents do next month? Do you have money saved? - My partner, my partner, I live together. He plays the rent, luckily I don't play anything towards that besides like our H-O-A-Fee. And then I do have a lot of spin along that, which is most of my what I'm responsible for, as well as groceries and things like that. But as far as living, you know, he takes care of that. - Okay, but I am saying though, you do need money right now to live off of like next month as an example, correct? - Right. - You don't have, you don't have $50,000 in an emergency fund that you're gonna use. - No, so I just have about 20,000 in crypto, about 8,000 in the bank right now. And it should be getting some severance that I'm trying to negotiate because it's like one month's severance. But I'm hoping to learn more about, I don't know if alone is the right way or how to, you know, I was thinking maybe shadowing a person that does it to better, you know, get to know how to start something from the ground up. - Okay, as far as real estate goes or what? - So does the thing, any, what is a type of business that? - Do you want us to help you figure out what business you should do? - Yes, and how do I obtain the money for it? I mean, buying a business, small business be like, - I've seen a lot of this on TikTok. So I think our algorithms are similar for different reasons, but I get a lot of these just buy up small businesses and it's great, buy a car wash, buy a boring business that generates 10,000 in revenue a month. So easy, it is not. And it's expensive and we never recommend anybody take on debt in order to finance a business, let alone anything else, but especially business because there's high risk. - Yeah, Jessica, how old are you? - I am thirty, I'll be thirty-nine in November. - Thirty-nine in November. Okay, what were you doing before? What was the job you had that you just got let go of? - So stormwater management like underground civil work and I have a background in architecture. - Okay. - Well, for many many years, it's what I went to school for, design and peer architecture. - Design, okay, perfect. And how much student loan debt do you have? - About 150,000 dollars. - Oh my gosh, what was it? Is that your degree? - It wasn't as much a degree as it was by the lack of knowledge and, you know, not knowing what we were getting myself into. I'm the first one in my family to go to college here in the United States. - Okay. - So I think, yeah, some lack of knowledge in regards to that and also since they were so high, they were supposed to be less, but once they graduated, they told me with more. And, you know, income or income. - How much were you making at your job? - 60 years, about 100,000. - 100,000. - Okay. - Bonus. - Well, if I were to paint the next two years of your life, Jessica, of what I would recommend, it's probably not what you're thinking, but can I just say, if I woke up in your shoes, what I would do? And George probably has a plan of his own too. But, so I think because of this debt, because, and you do have, you have some savings, you have 8,020 in crypto, I think my goal for you in the next 24 months is to be completely debt-free, have a fully funded emergency fund in the bank, and that's my take longer than two years. And to find a career path at which you are, you're qualified and that you enjoy and that you're good at that can bring in a similar income. So that's a very, that's very, where I would probably take you for the short term, meaning the next two to three years, is very different than starting, going and getting a small business loan and starting up a business, 'cause what that's gonna do is continue to add to the risk that you're already in, of having debt, and then currently, as we're talking right now, not having an income at all. So I would be looking to replace that income, any way I could here in the next little bit, because my goal would be to get out of debt, and not start something new right now, 'cause you're financially in the whole, and I would want you on solid ground before you start something. - Yeah, that makes sense. - So this might be, we're gonna start, this is a side hustle business, three years from now, and we're gonna do something that we actually enjoy doing, not something that we saw that could make money from social media. And so you love architecture, you love design, you love all the civil work that you've been doing, find the thread in that and go, how can I turn this into something that I own? That's a better path than I heard real estate is good. Let me go take on a $300,000 loan on an investment property. - Right, right, 'cause I don't want you to fall in your face. - Sure, the other thing that I had started for me was in my job was perhaps shipping online sales, taking a course on that, which was very economical. - How much was the course? - It was $500. - Yes, who got rich off of that? The person who launched the dropshipping course. The person who sold you the dream that dropshipping is gonna make you so much money. So how much money did you make dropshipping? - Well, I haven't been able to start it because I just felt kind of get that, honestly was getting in the way of things that I wanted to pursue. So I feel like now I have the time to pursue something and maybe I could continue where I left off with it. I understand it's hard work and there have mentors that guide you over step of the way. It's what they say. - Please don't buy another course selling you on an entrepreneurial idea. - And I don't know if you have time just get to start something new right now. You need money. - Right, yeah. So I think A1 is finding a job, any job right now. And then what Georgia's saying is on the side at night or on weekends, put some of your time and energy into something else to see if we can grow that. But yeah, starting, starting, yeah, the urgency of getting out of this $150,000 of student loan debt let alone being able to pay for food next month, I think is what I would be focused on. - Right, so what's behind all this, Jessica? If I said, why are you urgently chasing after these business ideas of dropshipping a real estate? What's behind it? What's the ultimate goal? - So that's always been an interest of mine. I've never thought I'd be working and I've never seen my life. I always saw buildings up there. - But what's been an interest in years? - Working for myself made perhaps sales since I was a very young child. I always had this entrepreneurial spirit where it was being 10 years old and learning how to do play to teach my friends and charging them or learning how to make all this intricate, do really buy myself back in my home country Columbia and make it and selling it there. And then taking it here when it can to United States, like hand threading a lot of it. - I love it. So follow that thread. What is the problem that you're trying to solve and who are the people that you're trying to help and what is your unique solution that can stand out in the crowd? If you just write, take that as a homework assignment and do not start another thing, don't buy a course until you finish that homework assignment. 'Cause right now I think you're just chasing after the wind and you're gonna spend a lot of money that you don't have in order to start businesses that won't succeed. Versus just taking the time to slow down, pay off the debt like Rachel said, get a full time job with benefits doing the work that you're already equipped to do and then start this other thing on the side for fun and then start charging and then see if you get traction there to the point where you go, oh my gosh, if I started doing this 40 hours a week and scaled it, I could outpace my current income. - Absolutely, and that's how it grows. I mean, the mistakes when we will make starting something is they take out the loan, they try it four years down the road. It's like, oh my gosh, it's not done what they thought and so they're stuck with a failed business and still alone to pay back. So move at the speed of cash, just go slow with the ideas. Now, I would say we should give our King Coleman's book, find the work you're wired to do. There's an assessment on the back of the book and take that assessment and see if some ideas generate but in our team will pick up Jessica if you stay on the line. But yeah, I think A1 still is finding an income to get this, I'd get the crypto out and I'd start paying down the student loan debt and doing something on the side. So I hope that helps Jessica. (upbeat music) When you take your car to the shop, you're probably thinking two things. How much is this going to cost me and is it going to get done right? What you need is a mechanic who will give you transparent information so you can make the best decision for your car and your wallet. Christian Brothers Automotive is the official auto repair shop of the Ramsey show because you can trust them to take care of your vehicle the right way. 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Just learning to be intentional and doing it all and that's what every dollar is there for so check out every dollar you can start for free in the app store or Google play. All right let's go to John and Charlottes. Hi John welcome to the show. Oh hi thank you so much for taking my call. Absolutely. I hope this is a life see where I'm in desperate need for some try to figure out how I get out of this situation that I got myself in. Okay my mortgage is 158788 a month. I have 175 on the house. Sorry you're breaking up on us John speak directly in your phone. I'm sorry see if we can hear you better. So 1587 then you got 175,000 left on the mortgage correct okay so close we'll try to get you a better connection John and jump back in with you. You sounded you we will be back John. Oh let's try again hold on a second okay is that better John. I mean I see you it was a good error me. Okay yes he said he can hear us so we'll jump to our next call and see if we can get you connected. We'll have our yeah we'll have our phone screeners get back on with you to get a better connection. Okay we will get back to you but let's go to Ryan and Asheville up next hype Ryan welcome to the show. Hi thanks for taking my call. Yep absolutely how can we help? So my wife and I are on baby step three we're quickly approaching baby step four. Just for quick context between us both we have two pension funds two 401ks and two Roth IRAs. My question is with similar rates of return if I have approximately 32,000 in a company 401k and only 9700 in my Roth IRA is it still better to prioritize my Roth IRA. Do you have a Roth 401k option? Yes okay I contribute one 20 a month as a Roth contribution. What's the match are they giving you a match at your company? So it's not a match it's actually they contribute 5% regardless of who I want you to say you did zero dollars they're still putting in 5% of your income. That's correct yeah I'm a first responder within a local government and so that's kind of the standard practice. One of the perks that's great okay so let's talk about your investment strategy here. Is the pension is that automatic and forced? Yes so it's a 6% from my check into the pension fund and of course I can't change that. I mean it's based on the average for highest consecutive years of salary at full maturity. Okay so we recommend 15% of your income going into retirement once you hit baby step 4. So once you get the fully funded emergency fund and the order you would do that in is match beats Roth beats traditional. So you said you get a match regardless so that's kind of nice it's kind of a moot point. But if you have a Roth 401k you sort of get the best of the both worlds from your Roth IRA meaning it's after tax money but it's going to grow tax free. So that might help with your conundrum. So a lot of people do if they don't have a Roth 401k they'll go to the Roth IRA first fill that up that's 7500 bucks for this year and then if they still have a net 15% of their income they'll go back to the traditional 401k. But in your case you might say I want to do all 15% of my Roth 401k and be done. But the good news is the balances don't matter. So you're going to see this it's not like if you invest in the 32,000 401k it's going to have higher growth than the IRA. Right. Ryan how much do you how much do you make a year? So between my wife and I the growth is 102 a year. How about you though like because we're talking about your numbers and your stuff what's mine is mine 65 year 65 okay because I'm thinking if the the 6% of the pension that you have going in we always say that half of the pension is what counts towards your 15% on baby step 4 because there is money going in which is great so you want to include some of it but you don't have a lot of control and sometimes they put it in pretty conservative investment so it's not very aggressive. So that would be so 3% of your pension is the 15 or you following me so you got 12% left of your income and you'll be investing a total probably of around $9,000 so you really could go fill up that Roth IRA at $7,500 and that leaves you you know $1,500 left you could just throw at the 401k if you wanted because you're getting 5% right we're not we don't count the employer's match or the employer's contribution in the 15% but it's so good to know that because so you know 7% going in the 401k it's probably what I would do yeah and it like here's what I mean it Ramsey for a long time is just 15% into my Roth 401k here and that way I never saw the money and so it sort of forces the discipline because it shows up before you ever get your paycheck versus some people going hey I've got extra money should I fund the Roth IRA or should I go on vacation and so sometimes it's just nice to force yourself to eat the vegetables which is kind of what you do when you dial up that investment in your 401k to 12% in your case. But going from a pension to a Roth in the 7 to 401k that is great and you guys doing that and your wife's and cut you know your wife doing the same on her side of it all amazing amazing amazing. That's impressive to me. I'm 27 and she is 26 oh good for you guys well you're going to you're going to kill it all absolutely all right let's go back to John and let's see if we got him on the line John are you there. Yes ma'am. Oh you sound clear. Clear is day okay perfect okay so we have your your mortgage and then you're saying what you had left on it was about $175,000 on your house so what is what's your main question. All right the main question is I have 23,000 and roughly 23,000 credit card in loan debt okay and now my social security is only 1561 a month and I only get and I only net around 500 from the rental property that I have okay so that average is out there about $2,000 a month. That's all they're income. So that's it. Oh my god. How old are you John. I'm an old man oh my god I'm 74 oh I'm not too old. You're good. Oh thank you thank you. A young 74 a young 74 God bless you for that one thank you so much I accept that. So you make a little over 2 grand a month between social security and less investment property what are your expenses every month between the minimum debt payments and your bills. All right now well I pay the I have a I have a rental that I pay rent in North Carolina that's 625 a month then I have all my credit card debt is 1200 a month and that's that's about it. What's the rental in North Carolina for because of the house that I rent I don't because of the house that I own is it is in another state. Okay so you have two mortgages no no no one mortgage in one rent okay so who's in the other house that has the mortgage on it. Oh my rent is my rent is you know my tenant. Oh that's your you're making 500 bucks a month between the mortgage payment with versus what they're paying. All right. All right. Okay. Well something's got to give here. Yeah. How much if you sold that house how much equities in that house well it's worth a Zillow's got it up there for about three three 10 and you owe 170 and you owe 175 correct. >> You might now 110, 115 in effort fees. >> And you're renting for your-- I don't know. For where you're living right now. OK, OK, gotcha. OK, I mean, I'm, I don't know. I wanted to do like a home equity or a cash out, but I don't know because I just is basically, well, there's two mortgages on the house. Now, so I don't know how to find anybody to take poll it. Let me bet. I don't know if I can. If anyone would take their place. If I were to try to get the cash out, they'll pay off the credit card. That's just moving around death, though. What we need to do is get out of the debt, which is going to require deeper sacrifice. So I would be looking at selling this whole thing and using that proceeds to pay off the debts. And maybe you'll be able to at least get by. Yeah, and maybe you'll have a security and maybe some part-time work. And after everything's paid, hopefully it's a hundred grand left. And then the hope would be that maybe you can find something small. Yeah, that's probably what I would do. John is probably sell this rental and it's in another state. You don't want to be a long-term, long-distance landlord. 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 of 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 taking care of plus making your will with Mama Bear only takes about 20 minutes. So don't make a mountain out of a mull hill. Go to Mama Bear legal forms dot com and use promo code Ramsey to save 20% on your will. That 20% off is exclusive to Ramsey fans only Mama Bear legal forms dot com with promo code Ramsey. [Music] Well, if you're new to the Ramsey show, it's important to know the way we filter our questions, we give our advice, we think through scenarios is in a pretty consistent manner, if you will, because there's a plan that we follow called the 7 baby steps and it really is the plan to get yourself in control of your money, get out of debt, save, invest, pay off your house, everything you really need to do in your life when it comes to your money and the order at which you should do it. So if you're not familiar with it, make sure to check it out. We'll put a link down below for those of you watching on YouTube or listening on podcast to check out the 7 baby steps because this is one of the most, you know, helpful things that you can do for your financial journey. Alright, let's go to is at Luis in Indianapolis. Hi, welcome to the show. Alright, thank you. Thanks for having me. So basically I'm calling because I'm trying to figure out whether filling my car is actually a smart financial decision or whether my partner is right about me being impulsive again. So a little backstory recently in December, my old car broke down. I tried buying a cheap two to three K car the very next day when it's starting. I got frustrated man in most of the decision and bought a $43,000 car even though I always told myself I wouldn't buy new because of a new car because of depreciation. So basically now I'm considering selling it, but I'm not trying to upgrade or buy another expensive car. I started a side of business, mobile detailing. So I bought a van. So right now, I want to be in brush buying a different car probably in the next month or so. My partner thinks I should just leave everything alone because I have a history of making impulsive decisions and sometimes we're getting them later. So she also thinks buying the detailed event was also impulsive. So my question is basically what's selling the new car and going back to a cheap car being me correcting that financial decision or am I just making another impulsive decision and should keep what I already have a wonderfully phrase question. So so far it doesn't sound like you think you're making impulsive decisions. So I want to know what Louie thinks about his own decision making because so far just my partner thinks it's impulsive. Do you think it was impulsive to buy this brand new car? I definitely think it was impulsive. Like I said, I did bought that you know I always have that mentality of like I didn't share you guys a show for since I was in high school. So I said I will never buy one because you know depreciation. So I make sure to buy a $3,000 car. But how much did you have the money? There's a middle ground here where you know it doesn't have to be from a three to 43,000. There's a gap here 40,000 dollar gap we can talk about. So is it on payments? So I actually I bought it a January like I said, I don't know December of December. And I actually paid it off end of February. So okay. That year. Yeah, I graduated nursing school of January 25 had about 15k and savings and thought that 2025. I saved up total of like 35,000. So did you spend all of your money on this car? I am the car and I had a $24,000 loan. So it was both. Yeah, all of my savings and earnings I spent on the car. Yes, so that probably is not smart. Do you have any other debt? Are you debt free now? I'm debt free now. I make sure you know I don't have a budget. I don't do a budget or anything like that, but you know I kind of go I would take three or two weeks. So I just kind of go. Do you think just spitball and do you think a budget would help you make less impulsive decisions? I think so. I definitely think so. I tend to be very. Yeah, I just tend to be. I kind of go with the flow and I usually like structure. But for some reason when it comes to budgeting, I think to find different kinds of budgeting apps, but nothing, I don't know, nothing to really grasp my attention. So I just end up going to, you know, just kind of mental budget. It's clearly that one's not working. So let's try a downloaded app for now. I'm going to gift you one called every dollar. I'm going to give you the premium version. It'll connect to your bank account. That's step one. It was we got to make a budget. And your partner can be your accountability partner and saying, hey, that brand new car was not on the budget this month. Now, if you want to save up and get a car, let's put it in the budget and say a thousand bucks a month. We're going to put away in a sinking fund. And by the end of two years, we got 24 grand. Well, and how much do you make a year? Well, I make a total of like 90,000. Pick up some extra shifts in the five business. So I'd say about a hundred K. Okay. Okay. And the vans paid off. Yeah, yeah. So, yeah. So, you know, this has been positive too, Ryan. Summer, I basically had a savings of like $15,000. I ended up putting $10,000 on like the $4,000 or $5,000 on the van, the equipment. So then basically right now, I have $5,000. Okay. So I honestly, because you're under that, we say that you're anything with motors and wheels that you own, should be no more than 50% of your take-home pay. But let me get this right. The car, the $43,000 car, is different than the van, right? Correct. That's just more of the van I usually just used it to like go from. And how much is it worth, would you say? The van, I'd say, it's probably worth about $3,500. Oh, okay. Okay. You know, it's paid off at this point. I think you would. I don't know if I would sell it, because I think that you're going to take the hit of it being a one-year-old car. And I don't know. You know what I mean? At this point, the car isn't the issue. You're the issue now with your money. Yeah, if you may like it. You have to control yourself. A lot of oath to yourself and God and your partner that no more impulsive decisions we're going to budget for all these things, then it's okay to keep it. Now, it might be a stark reminder of your past decisions. And if that's the case, if it's going to keep you up at night, you know, slamming your head on a desk going, "I shouldn't have done that. I shouldn't have done that." Then, sure, sell it as just so you can stop letting that live in your head rent-free. But as far as our parameter goes, it is a lot of car for a young guy. You're making good money, but it's not violating the parameter so much that I would say if you go sell this tomorrow, you're broke. It's not freeing up a payment. You're not needing it to pay off any other debt. So if you love the car, you can keep it. What kind of car is this? It's a, basically, 2025 Honda Accord. Is it hybrid touring? Okay, that's a sweet ride. I was obsessed with it, but now it's just kind of just sitting there. You know, I mean, I don't even want to put the mallet on there right? Because eventually I do want to sell it. Just drive it to the wheels fall off. Yeah, you bought it. You got it. That should be the pack you make is I have to drive this thing for 10 years to prove to myself that I don't impulsively jump in and out of decisions. So your goal needs to be to build up an emergency fund. of at least three months, put that aside, and then start investing your income, 'cause at least you can start making smart decisions today, because the guy you've been at this point is a little bit, you know, on a whim, and an expensive whim that you go on, and that's how you're gonna live your whole life, it's kind of this like whim to whim, versus saying, I'm a guy that does have structure, I have fun, and I enjoy my money, but I'm gonna have a plan around it, and some level of control when it comes to my spending, so that I know what is going on, and that's what the budget's gonna help you do, and you put all that together, you're gonna do fine. Like you are, you work hard, you mean you paid off, gosh, the car and $24,000 in student loans in a year, so you obviously have a strong work ethic, I think you're gonna be able to make some great money, you just want that money to be put to good use, so I hope that's helpful, but yeah, stay on the line, we'll pick up and get you every dollar premium for free. - I like these promises, I will not go into debt ever again, unless it's a 15 year mortgage, and I will not make impulsive purchases, and I'm gonna let my partner advise me and give me wisdom, because they know me better than anyone. - She's probably like stupid, Louise, what are you doing again? - What are you doing? - You got a business, I've already came home, that's what he said, he's like, listen, I bought a car-dueling business. - Yeah, every time it comes home, there's a new decision that drives me home. - And then I bought a new car, just like what, and it's jumping from extreme to extreme, which can happen, but you go from a bidder, to a $2,000 car that won't start. - It sounds like you have money, just read it. - We don't tell people, go buy $2,000 cars for the rest of your life. - If you have money, yeah, you could've gotten a grade. - If you're in crippling debt, you need something to go for a B. - Go get a $15,000 car, there's that middle ground there that's important, versus letting your emotions take over, always so. Logic is gonna help you, my friend. - Always move slow, slip on it, just sleeping on it, might change your life, whatever it is, $10,000, give it a rest first. (upbeat music) - When you're trying to hire, you don't have time to dig through stacks of resumes, hoping someone halfway decent floats to the top. That's the world's least fun game of where's Waldo. What you do need are qualified candidates who won't waste your time, because you can be sure they actually want your job, which is why I love the way Zip Recruiter is helping small business owners right now. Zip Recruiter has a new feature that finds the kind of people who will go the extra mile for you. Candidates can now tell you why they're interested, may passionate about your role. In Zip Recruiter Smart Matching Technology, automatically puts the most qualified, most interested candidates at the top of your list. So, instead of sorting through a pile of just okay, you're seeing the right people faster. In fact, four out of five employers who post on Zip Recruiter get a quality candidate within the first day. That's not a coincidence. It's because Zip Recruiter goes the extra mile for you, just like the candidates you want to hire. Try Zip Recruiter for free today at ziprecruiter.com/ramzie. That's ziprecruiter.com/ramzie. Meet your match on Zip Recruiter. (upbeat music) Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I am Rachel Cruz, hosting this hour with George Camel. And we are answering your questions at AAA8-825-225. So, give us a call. We're talking about your life and your money. Up next, we have Brooke in Salt Lake City. Hi, Brooke. Welcome to The Show. Hi, how are you guys? Hi, we're doing great. How can we help? Good, I am just curious. How do you stay humble, but stand up for yourself when your family members make comments about you not having money, but they don't know the whole story? No, what happened? We just, we tried a little humble lifestyle and you know, used the every dollar app and we just get comments sometimes randomly, mostly for my husband's mother and she says things like, "Oh, I wish you did things like your uncle and you were smart with your money instead of buying this." I don't know, $2,000 hunting boat. There's what happened yesterday. Your husband bought a hunting boat for $2,000? He's, yeah, he's going to, mm-hmm. And she said, she doesn't think that's wise decision. She doesn't think that we save for it and pay cash for things. Would that make a difference to her? Or does she just think this is a stupid purchase? She, her comment was mostly like, your uncle stays and saves and then buys what he wants when he wants to when he has a money. You don't have to respond to anything she says. She doesn't get a vote in your life. But did you not say, that's what we do? Yeah, we did and she just said, well, it doesn't seem like that. And it's just hard like to, when people say things like that and without wanting to be like, oh, I have all this. Like, how do you just? Without needing to prove yourself? Yeah, yeah. Has she always been this way? Do you guys have this kind of relationship where most things she says bothers you? Oh, a little bit. Okay, just maybe a part for the course with mother-in-laws. I don't know, but I think this is maybe tip of the iceberg of she's just this kind of a judgey your person and rubs you the wrong way. And like Rachel said, she doesn't know your life. And super rude. Yeah, I just imagine telling, if this is my mom, I really wish you. Why doesn't your husband step in and take her aside and go, hey, mom, listen, we don't need to vote. We don't need your opinion. Yeah, he did last night after the fact and we've gotten comments sometimes from other family members that we have to not like to this extent. It's been a little more subtle here and there, but he did pull her aside last night. But it's just he like, how much do I tell her? Do I tell her we have all this money? Do I tell her how much we make? Do I tell her we have all this retirement? Like, she doesn't, she worried about us, you know. I only can use to show her a spreadsheet. I think he can just have a conversation saying, hey, mom, appreciate your comments. They are unneeded. We're doing fine financially. We don't go into debt for things. We save up. You can mind your own business. Like I feel like she doesn't even, I mean, I'm one extreme. I'm like, she doesn't even deserve a comment. I'm just trying to shut this down. We don't need to have conversations like this. We're doing fine if we need help for struggling. Well, you'll know we let you know if we need help. I mean, I won't let her know. Well, if they want the comments looking for your opinions, we will ask for them. That's it. I think it's that if we want your opinion about money, we will ask. But how is she doing financially? It's just a rude thing to say to someone. Do you think she's projecting? She definitely, I don't think she's doing amazing financially or don't think she's doing awful, but I don't think that she's at a point where she should be at like her age. But-- OK. Yeah, well, this is easier said and done, Brooke. But I mean, I honestly, your whole life when you try to dance around what other people are thinking and trying to prove yourself, that's just a long, exhausting life. So there does have to be a level of-- which is easier said than done, I know. But where you have to be like, this is our story. This is what we're choosing to do. And other people can make judgments, make comments. But it is what it is. And we're secure enough in our plan. And we know what we're doing, that we don't even need the affirmation of the outside people to feel good about what we're doing. We don't need them to even know, because it's none of their business. And that's usually what we're like. Yeah, but this just bothered you. This bothered you. What are their comments are made? You said that this was the most obvious comment. Are they like passive-aggressive? It's just been-- no, it's just been things like where we make it a point to say in front of our kids instead of saying, we don't have the money for that. We say, it's not in the budget, right? So we say that to people when they're like, hey, do you want to go to saying George next week? And we're like, oh, no, sorry, that's not in the budget. We didn't plan for that this month. And then they say, oh, OK, you know. Like, such as little things like that, where you can tell that they're like, oh, why can't you just do it? Sure, yeah. And it's hard to-- And you can't, right? Like, you guys aren't at a point that-- We could. Yeah. We're on baby steps six. And we have your money. We make about 240 a year, 18 to 20% away. Oh, way to go. We're going just fine. But we just budget-- Well, you're different priorities than other people. Some people want to go on vacations every couple months. And you guys spend your money on a crossbow. Like, it just depends on your personality. So as long as you're living out of your values and you're not sort of shorting yourself by saying, we can't spend. Instead go, you're what we choose to spend on. That's what I do want to make sure, bro, because you guys are enjoying your life. But you're comfortable with the decisions you've made. Oh, yeah. OK, that's great. That's what I want. I don't-- because sometimes we get people-- And we go on trips and stuff all the time. But we just-- The children aren't suffering. And for that next month. Yeah. And to shift the language a little bit, just as a thought, since you guys are on Baby Step 6. And since you could technically put it in the budget if you wanted to, right? Right. It-- I do wonder if the sentiment of it's not in the budget usually means that we don't have the money for it right this second. But when you have the ability to-- you could just say, oh, sorry, we can't. And the kids start to hear more. we get to make this. based on our value system. Because mom and dad have done so well and because we followed a budget for so long, we actually have the ability to do some of this. But we're just choosing not to. Does that make sense? - Sure. - Versus villainizing the budget. Not to other people, I'm thinking more of the kids, even though I tell my kids that at the time. I was like, "We don't have the money for that, stop it." Stop it, get it, stop. - Shuts down the conversation. - It does, it does. But I always do wonder because you guys are on this side, it would be different too if you were getting out of debt and you're on baby step one, two, or three, and then it really is not in the book. You really don't have the money to do it. And that's a fair reality. But I wonder the narrative at which you're talking to get. This is less about other people, maybe more within your home. And for yourself to give yourself, I don't know, the permission to be like, "Yeah, we're able to do this, but we're gonna just choose to say no." Because we don't want to spend the money there. Well, you want your kids and everyone else to see that you're making decisions out of confidence and who you are and what your value are instead of a place of weakness of this like, "Well, we just, I don't know, we can't. It's not in the budget." I do think the language matters. - Yeah. - And we always say more is caught than taught. So the kids will grow up thinking well, we never had money for that. Instead of, well, we had the money, we just, that wasn't a priority for us. - For mom and dad, yeah. And that they're grown up enough that they don't feel like they're having to be swayed in every situation. - To do things 'cause someone else asks them or pressured them. - That's right, yeah. Yeah, I don't know, just the top broke. I appreciate the call though, but yeah. Yeah, the mother-in-law thing. I think there's just a point that you have to say, of course. Of course, she'd make these comments. It is what it is. And you keep moving on. Don't let it, don't let it pin you down. I'm ruined your day. (upbeat music) If you're waiting for rates to drop before you buy a home, here's what nobody tells you. When rates fall, every buyer who's been sitting on the sidelines makes their move at the same time you do. That means more competition, higher prices, bidding wars, all that. That's why I tell people to talk to Churchill mortgage before they do anything else. Churchill gives you a strategy so you're not at the mercy of the market. They can show you what you can afford, not just what the bank will approve and with their certified home buyer program, your financing is completely secured before you shop, which means when rates drop and everyone rushes in, you're already ahead of the crowd. You're not scrambling for pre-approval while the house goes to someone else. My husband and I bought both of our homes with Churchill and having a real strategy, not just a rate we were waiting for, made us ready when it really mattered. So start your search with Churchill. Click the link in the description or go to Churchillmortgage.com/ramsyoffer for an exclusive Ramsey audience offer. Churchillmortgage.com/ramsyoffer. (upbeat music) (upbeat music) - Well, George, I think some of my favorite memories growing up were trips. It's probably my love for travel. - Ramsey's love travel. - We love, we do. We love to travel and Mom and Dad, they would always, we went from like camping intense as they were getting out of their, you know, trying to out of the bankruptcy and all of that and then by the time I hit, probably late middle school, high school. We actually went on like vacations. We went on trips and Mom and Dad made it a priority. They do love to travel and they still do. But one of the things we did all the time is we cruised. We were a cruising family. - Wow. - So you're either a cruiser or you're not. So I hear. - Yes. - And we've done the, we did the big ships. Even as adults, we've done some in Europe. They've taken us before we had kids, but it was like Winston, my sister and her husband, and we did like a Baltic Sea, like a smaller boat, like some really fun experiences. And there's some of the best memories. Again, I've had are these trips and so thanks Dave and Sharon for that. But the great thing is, is that Dave's love for cruising has spilled over into. - It's infiltrated. - Emergency solutions. - It's a Ramsay Land, you can say. And the idea of going on a cruise called the live like no one else cruise came about a few years ago. We did our first one. It was two, a year ago, it's when we were there, March, March of 25. - 25, yeah. - And this is for people and baby steps, four, five and six. So when you're out of debt and you have your family, but it's different. - You can come if you're on set. - Oh, sorry, yeah. - A lot of seveners. - And sevens. - Plus seven. - We forget about seveners. - I know sevens, a lot of seveners actually. And it was like this, hey, we talk about the sacrifice and everything you have to do to get yourself in a good financial position. And so you live like no one else. And then later you get to live and give like no one else. So let's do the live like no one else cruise for those people and let's celebrate and have fun and create memories with your life, right? And to enjoy it with other people. And so we are, we're so pumped 'cause we're doing it again. And this next one coming up is in March of 27. And it is, it's filling up George. - Seven nights, Western Caribbean, Bahamas, Jamaica. Ooh, I want to take you. We got Grand Cayman, Cosmell. The entire ship is Ramsey fans. - That's it. - And the Ramsey personalities. - And look at it, it's beautiful. It is a, and it's a nice ship, Holland American. Dave had to, had to approve, you know that. He had to, he had to say that he would enjoy this. - Well, he said he does want Walmart of the seas. - Yes, I know. - He wants it to be clashed. - It is, it's such a beautiful nice ship. My kids, they're coming for part of it. - Can't wait. - It overlaps the Lars Pring break, I know. And so yeah, it just, it's so fun you guys. And all the Ramsey personalities will all be there. Every night will be, yeah, hanging out during the day. - We have all new content. We're going to do the world's largest, dead free screen, life tapings of your favorite Ramsey shows. Maybe even smart money happy hour, who knows? - Oh, look at us, Lord George, just laughing. - We got to make a drink live on stage. It was disastrous and hilarious, it was great. - It was great, but yeah, join us if you will again, if you're on baby steps, four beyonds. And let's, let's celebrate together. So you can secure your cabin. And if you want to go to ramseyslutions.com/events to book or we have a little QR code on screen for watching on YouTube that you can, that you can click on. But we want to, we want to hang out with you. Next March, March of 27 come cruise with us. There'll be some good memories. All right, let's go to Houston, Texas. And we have, oh, Kormack. So how we would say is that it? Did I pronounce it correctly? - Just Kormack, yes. - Kormack, okay, perfect. - I think so. - Yes, how can we help? - So my last night of, over previous few years between bad luck and bad decisions. We racked up about $120,000 in debt and not including our home. Feel in the pinch, trying to get things right. I've discovered the program a few months ago and have the 1000 plus saved up, just trying to get out of debt. However, what I've noticed is because our minimum payments are so high we're making such a small dent. We're wondering if we're better off doing a chapter 13 bankruptcy, just consolidating everything or caching out one of my broth IRAs, which is almost cover the full debt and trying to rebuild. - Wow. Can I ask, what is the 120? What kind of debt is it? - A combination of vehicle and the mostly credit card. - Vehicle and credit card, okay. How much do you owe on the vehicle today? - 20,000 and that's about what it's worth. - 20,000 and that's about what you can get for it. Okay. Any money saved besides the 1000? - I've got a couple of dollars saved up. I do have a federal employee, so I have my TSP, which is like the 401k plus before I join that, I had a Roth IRA saved up, which I have about $110,000 in. Okay, so it's a 100,000 and credit card debt. - Yes, is it, was there, did you try to start a business or what was that used on? - Fortunately, I went through over the past five years, there was a divorce that was contested, sorry, that was heated. I grandmothers and my father passed away within several months, a couple months of each other. - Okay, wow. - And then good stuff did happen where I met my now wife and we have remarried and we have two beautiful children of our own, but those also cost money. - Yeah, so you've had a lot, a lot happen. - It's been an active couple of years. - Yes, okay, so how much money do you and your new wife make? - Combined about 250,000 a year. - Oh, well that's great. Well. - Are you guys investing right now? - At the exact moment, no, because I pulled out my my auto pull out of my paycheck, I let you all that, or see me, I stopped all that to try and get a handle on the debt. - Good, and same with your spouse? - Correct. - Okay, so I'm just looking at all the options here. So we never encourage bankruptcy. - Of course. - It will destroy your life for the next 10 years, a lot more than it might help it, especially with chapter 13, where you're just restructuring and you're getting on a payment plan. And so I will. look at this amazing income and then your expenses to go, what can we cut out of our lives? How do we make more so that we can get ahead of this? Because right now you're saying the interest alone on a hundred grand, a credit card debt. What is the minimum payment per month and what's the interest every month? I've told my head that combined payments are well over three thousand a month. Okay. And the average, the average of the interest is about 25%. But are you guys taking home about 15k a month? No, I have a child's poor payment from my first marriage so that it has a good dip into it and then just medical expenses as well as we have a second home that we are trying to unload and that but in the meantime, it's still costing us money as well. Well, the proceeds be from that if you sell it. I mean, I just want to work out to sell it for just cost to just get out from under it. Okay, but that'll free release the mortgage payment. Correct. It should be about including the tax payment up about two thousand a month. Okay, great. Would that help you get ahead? Would you be above water here? If you've heard of the two grand? My concern is my job has a mandatory retirement of 56 and I'm 38. I only have 18 years left to work. And because I do not have a college degree, I don't feel like I'll be able to get a similar job pay scale wise. So I'm just the dry I am hesitant to drain my of the one retirement account because I'm just not I'm worried I will not have enough time to rebuild it before I am forced to retire. Sure. That is a concern. And we only tell people if you're going to if you're facing bankruptcy, it's the only time that you would ever even consider dipping into retirement. But I would still use that as a last ditch effort. Not a let's go green light drain your Roth IRA today. I would do everything in my power to use your current assets in future income to knock this data over the next couple of years. Yeah, which I think if you took a good heart to the budget, you could find some money. Yes, and that's what I'm wondering. So I'm like, okay, say you guys lived off of 4k a month, which will feel very different than probably how you have with some child support payments. You said, I mean, I feel like you can I feel like you could you guys could find four or five thousand a month. Yeah, so over the past six months, we've cut out the sold the car. We like so we're trying to get rid of this spare house. We have cut all streaming things. We're we're we're trimming. I pick up the second job. Okay, good. Good. Because 5k a month throwing at this debt, you're done in about two years. Yeah, that's what it's a fine 5k out of this amazing $240,000 a year income and plus extra. Maybe some extra. Yeah, you climb out of this without touching your tire. It's going to take some time, but do not touch retirement. Don't fall for bankruptcy. You guys have the income and the work ethics get out of it, it may take two years. If you're behind on your bills, doing more of the same isn't going to fix it. You need a different plan. And that's why I tell people about Guardian litigation group. If you've missed payments, if collectors are calling nonstop, or if you're getting letters about legal action, that's your signal. And it's where a lot of people wait too long because the longer you wait, the fewer options you usually have. And once it turns into a lawsuit, things can get more expensive and more complicated fast. Guardian litigation is a law firm, not a call center. From day one, you are assigned an attorney who represents you. So if a creditor moves forward, you're not caught off guard and you're not hit with surprised legal fees. Guardian litigation only gets paid when the debt is negotiated and the client accepts the settlement offer. This is about stepping in early while you still have leverage. Don't ignore the problem. Take control of it. Go to guardianlit.com/ramsy right now. That's guardianlit.com/ramsy. Attorney advertising results may vary and no specific outcome is guaranteed. So one of the sneaky things about debt, I would say, and building a life around it and we're talking everything from putting vacations on credit cards to financing furniture to all the above is you see the price of something and you assume that's it. That's it. But the problem is when you use debt, there's a little thing called interest, George, that'll get you. It'll get you. So the people think that's no big deal and they don't teach this stuff in school. Yes. They're not telling you what 20% APR actually means. That's right. Comes to that purchase. Yep. So we wanted to kind of do the math, if you will, on what it actually really is costing you. The hidden cost of this quote-unquote American life that people build. And when you do it on debt, again, the numbers change pretty quickly. And now more than ever, there's a way they'll get you out of there with that thing. Yes. Regardless of what payment you can afford and what the interest rate is that they'll tuck into the fine print. So let's talk about sticker price versus actual price. Let's start with a new couch. That's a famous one. You go into any furniture store. They always have some deal happening with the interest. Yeah. Zero down. Zero percent for the first whatever. So let's talk about a new couch. Let's say the sticker price is $1,500 and it's 20% APR for 36 months. So when you hear the word APR, that's an abbreviation for annual percentage rate. This is essentially the full cost per year of borrowing that money. So it's not just the interest rate. It's actually the interest rate plus whatever fees they have all baked into one final rate. So 20% APR for 36 months, what you'd actually pay for that $1,500 couch is $2,000 and seven dollars. Gross. So over 500 bucks in interest alone. $500. But think about that. That makes the effective interest rate about 33%. About a third of that couch paid extra in interest. Extra to go. That's crazy. Okay. Let's look at credit cards. Let's say you got a $6,600 balance. And you know, you have a 22.8% APR and you'll be paying about $300 a month. So if you do that, it's going to take you about two years and five months to pay off this credit card. And the final price of the credit card is $8,628. So over $2,000 in interest alone just by saying, Hey, we're going to just we're going to live life on a credit card. May or may not be able to pay it off fully every month. So we're going to kind of just keep it around. And then it ends up with a balance of you have $6,600. Wow. Okay. Okay. That's not even minimum payments. That's your paying extra. Okay. You're ready for this. So then option two we have here. Same APR 22.8% and you just do minimum payments. Okay. The pay off time is 20 years and one month. And the final price will be $17,000 and $60. So you're paying $10,500 in just interest. If you're just paying the minimum payments. That's wild. And if you are able to watch on YouTube Spotify, we've got the charts up to visualize all of this. And it is staggering just to look at the numbers on this to think. Now, I hope nobody takes 20 years to pay off six grand. No, surely not. But listen, the fact remains, a lot of people are just making minimum payments because they can't or don't know. For years, yeah, maybe 20 years, but for a good amount for sure. Can you imagine that whatever that thing was you put on the credit card, you long ago, like the 20 years ago, that's a lot of stupid tax to pay. Let's go back 20 years. You got a little 2006 action. What did you buy in 2000? What decisions was I'm making at 17 years old? I don't want to know the stupid stuff I was buying. Wow. Okay. Now let's move on to a bigger one, a car. Yep. So sticker price, $35,000, financing at 7% for five years, final price, $41,582. So an extra, we'll go $6600 in interest alone. And think about this, that car is no longer worth $35,000 because we know that cars go down value about 60% in five years. Yeah. So that $35,000 car, you'll be lucky if it's 15 to 20 grand. Well, it's hard. It's 35 and that's before sales tax, registration, dealer fees, warranties, all that. So that easily could be out the door at 40, 42. Ouch. Yep. So you're watching what it is. Why financing the car is one of the biggest wealth killers for the middle class in America today. You don't realize just how bad it is when you're paying interest on a depreciating asset going down in value. All right. Finally, the house. Now this one can feel like the least dumb decision because it's a house. It's an asset. It's going to go up in value over time. So let's talk about a sticker price of $350,000 for that house. And you're going to put 20% down. So 70 grand down, and you're going to do a 30-year mortgage at 6% APR. Well, the final price of that $350,000 house is $674,000. Around $324,000 in interest. Which is almost as much as that house. That's crazy. Wild. Wild. And if you did a 15-year mortgage, then you'd pay $179,000 less in interest. So, almost $200,000 you save an interest just by paying it off in 15 versus 30. - Which is why we always tell people. - Yes. - Just get the 15. Don't get a 30 and think you're gonna pay it off like a 15. - Force yourself in it. Yeah, and I think what's hard is, again, you end these individual situations. It may feel like a good idea. Like sure, let's just put the vacation on the credit card or we need some new furniture. So in this one situation, we're gonna do this. But what happens is that this builds over time and for a lot of people, you're not able to pay it off in six months to a year. If you're just living paycheck to paycheck and not really making a plan for it. So, to make another debt decision, easily could come up nine months, 12 months after the other decision, right? And it just keeps piling up and then you realize how much money of your money you're sending, not just for the item, because it's not just the sticker price, but all the interest to the banks and everything in these industries are there to make money and they know how to do it for an America especially. Oh my gosh, how much people take out debt most of that. - The amount of interest lenders are collecting every year with boggle in your mind. So here's the thing to remember. Wealthy people earn interest, broke people pay interest. You wanna be on the wealthy side, earning it instead of paying it. And remember this, the sticker price is never the final price. So anytime you see that, anytime there's a salesperson involved, they are trained to sell. They are trained to let you focus on the features and the benefits and how you're gonna feel when you leave with that thing. Not the fine print, not the APR, not how much you're gonna pay in full. And the taxes and fees a lot, a little the interest will add a lot. - That's right. Yep, and minimum payments, it's a debt trap. Like that kind of system, that systematic thinking of I'll just pay minimum payments for the rest of my life. That keeps you, keeps you, guarantees you in a cycle of debt for a really, really long time versus saying, hey, I wanna get out of this. I'm gonna stop going into debt and I'm actually going to aggressively pay it off beyond the minimum payments to get out of debt as soon as possible. - And lastly, cash changes the math and the mindset. Yes, saving up feel slower. Yes, you're gonna have to say no right now. But it's actually the fastest path to taking control of your money. And it makes you think twice. When you were to save up and actually see that amount of money leave your bank account, you think twice about that couch. You got to find more on Facebook marketplace or are you like, are we good? - It took us three months to save up for that couch. I don't know if I wanna let go of my heart and money. Think about how much of your working hours are spent just giving it to a lender. That's crazy to think about. - Absolutely, and I'll say this too, when you spend in cash and like larger purchases, you do realize, okay, I may not need that. Like if that cash is there, right? In our plan, we would say you can pay for it. Like if you have the money for it, that is fine. But so when we run into this with our van, even furniture, we've had our furniture for a gosh, it's going on how many years, seven years. And so there's a couple of things we wanna upgrade. But you're kinda like, well, the kids are still, I almost find myself being like, do we need to, I don't know, because I don't know if I want to, it may hurt to spend that kind of money. But you don't have that emotional attachment always with your money when debt is being used. It is just a sign of a signature. - You sort of bypass a big part of your brain that's the logical side and go straight to that while I want it now. It's the toddler in you. - Yes, yes. - Winning, do not let the toddler win. So the average individual, the average American, the average broke person just asks, how much per month, how much down? That's the problem. Financial wise people, wealthy people, they ask, how much, what is the full cost, total cost? And if I don't have that amount, I'm not buying it. And if you do that, you will take control of your money. So we've got an app that helps you do this. It's called Every Dollar. You can create sinking funds for that next big purchase and do it with confidence and peace. We'll drop a link in the show notes if you're listening on podcasts or YouTube to that app. (upbeat music) (upbeat music) - 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 800-356-4282 to get your family protected with term life insurance. That zander.com or 800-356-4282. (upbeat music) (upbeat music) - Well if you're listening, you're one of the best pieces of marketing we have up there in the world. When you share the show and you tell your friends and family about it, it is so helpful because we want to be able to help and talk to as many people as possible to get them in control of their money. So if you will like, comment, subscribe, share the show that helps us out a ton. You mention it at your next dinner party. - Yeah, just start out there. - Play in the background and then go what is that? What is that about? - It's a Spotify music music, that's George Campbell. - That's what's happening. No, we are clapped and playlist here. No, no, no, no, we got the Ramsey stuff. - You got me, that's all you need. - All right, let's go to Ben in Chattanooga. Hi, Ben, welcome to the show. - Hi. - Hello, how can we help today? So my main question is should I stretch for a 1.1 million dollar family farm dream on 186,000 dollar salary? My wife's grandparents owned a 28 acre farm in the Northwest Georgia mountains. My wife has always dreamed about living on a property like this. About six years ago her grandparents put it up for sale. We found that we were in a position to make an offer. So we offered 500,000 for it. We were living in the Boise area at the time and that would have been contingent on our house. However, they ended up selling it to someone who offered a higher price close to the full price. It was 586K, we believe the real estate agent kind of shed some influence on that. And this has been kind of a lasting source of disappointment for my in-laws and the family. Now we've relocated to the Northwest Georgia area. The current owners have offered to sell us 17 acres of the farmland for 500K. However, the county blocked the lot split after we completed the survey due to a maximum number of six residences on a private road. We went through the variance process with the county. It was denied after that owners offered us at least a purchase arrangement where we put up the price for the 17 acres, 500K with no payments. And then after 36 months we would purchase the remaining 11 acres. I countered with just an idea of leasing the land outright for $300 a month and then having a first right of refusal that when they're ready to sell, we could get the land for 1.1, which they said they liked that. They're thinking about doing that in a year or two. My financial situation, I have about 700,000 in retirement funds about 450K in cash from the sale of our previous house, about 50K in the stock portfolio, about 20K in an emergency fund, and about 30K in an HSA. And so that's about 1.2 million for my net worth. My in-laws have offered to pay $1,000 a month if absolutely needed to pay for this so that it can come back into the family, however that would come out of their equity in their house at this time. - Man, no, work a real hard for this piece of property. - Yes, so everybody's working really hard. And so my concerns are just affordability for myself. That's a big debt for my salary. - Are you guys renting right now? - 650. Yes, we're renting. Okay, would you think about putting the 480 down as a down payment because that'd be almost half of it? Yeah, I would be putting down at least the 450 and Keep my emergency fund is what I would yeah, what about the stocks could you liquidate those? I would like to keep those And well, okay, it might be growing Okay, my quick math. So I would tell me the spin if you did put down 480 It looks like the payments then and this would be on a 30 or not a 15 and we recommend a 15 But it would be around $4,000 a month and do you guys bring home around 15k? I'm just trying to figure out if we can make this Mathematically work yeah, what's your after tax monthly income without any 401k contributions or health care premiums? What is your after tax monthly income? So after tax without any of my benefits would probably be Around let's see it probably be around like 12,000 okay Probably more like 11,000 So if you did a 15 year like we recommend it'd be about half your take-home pay and so you're worried about that Legitimately, yeah, that's gonna make you guys house poor now. What is the future hold? Can you buy this thing? Can you set up an agreement where you purchased this thing? Let's say two years from now and you guys just sock away cash I mean that is Kind of what I'm thinking that I would need to do in order to because no one else is Jones and for this property Right and the and the people who I want it don't really they're okay get now. Yeah. Do you want to move to have been? Yeah, it's a beautiful property. I mean, I'm sure I mean the North gosh North Georgia mountains are gorgeous My issue is always just to do the does the math Add up and am I gonna feel like this is going to weigh down on me with that amount of debt for 30 years Make that's always my concern. Yeah, I would not do this today I think there is a future where this can make sense and you're not stressed out about it I mean you guys have waited this long for the dream so let's make sure the dream is a blessing and not a burden once we get into it Now ish, do you guys have kids? Yes, we have five kids, okay, I'm 12 and under does this move make sense for you guys like if you just did this thing next year Would this work with your jobs? Yeah, so I Would need to commute but I'm already commuting we live nearby. This is the whole reason we move here. Okay Yeah, well, I would say if you can set up a two I mean if this is really what you guys are wanting and you're like this is gonna be a long-term play for us Then yeah, I would say give it two years because I think after Stocking away some cash and then maybe cash and out some you may have to cash out some stocks Just to make it work because you have plenty in retirement. You guys have 700,000. That's what you said Yeah, yeah, so your retirements, but I mean all of it. You're just kind of you're gonna be really real estate heavy in general After this, but but over time it's gonna it will it will even out Which I'll be honest with that's what I mean when my husband and we built and we moved in 19 We are pretty real estate heavy. Yeah, I was the same way Yeah, and and over years you you worked to to even it back out right and then have more cash and and retirement all of that but So I think that's okay for for the short term so if this is something that you both really really want to then There's gonna have to be some sacrifices made and that's gonna be putting away money Seeing if you can get an agreement with them that in a purchase in two years holding the value with it not going up I think if you can hold the the purchase price today and do it in two years and And then possibly having to cash out some stocks just to make up a difference because I would rather have Breathing room and rebuild in the market investments when you're not penalized like I'm not talking about retirement Don't take anything out of retirement, but I would do that to because it sounds like a dream I mean, it's just it's it sounds amazing and beautiful and it's been in the family like it would be worth going in and Sacrificing for two years to get it and then knowing the next three to four years We may be real estate heavy, but it's not gonna it's not gonna sink us. It's not gonna sink you Yeah, I mean, I would highly consider it and then see what you guys can reasonably put away to go Can we put six seven grand away for the next two years and have 170 grand on top of what we currently have To make this thing make sense and and are you guys working with a good agent We have not asked an agent yet about any of this I would get them involved to see is it actually worth 1.1 million are they just squeezing you because they know you really want the property Is this thing really worth 800,000? Okay, so that's that's what I want you to do your homework on not just go Well, it's 1.1 it has to be 1.1 you might be able to get it for a lot cheaper if you have some negotiating power And that's the power of a great agent so Ramsey solutions dot com slash agent if you want to get a second opinion And I would to make sure that you save the most on this thing and don't get squeezed just out of it's our dream Let's just do it no matter what well and you've already played the emotional cards because I know it's a family property You know what I mean like it's you're gonna have to Yeah, do some good negotiating with it, but yeah, the answer today been is no It'll be 50% of your take-home pay the payment and that would not be worth it, but wait two years possibly If you're already enrolled in a Medicare plan you might think there's nothing else to do you're good to go wrong The fact is Medicare premiums networks prescription coverage and benefits can all change even if your health doesn't So doing nothing could cost you hundreds or even thousands of dollars a year with annual enrollment time coming soon You need to talk to chapter right away chapter is the only Ramsey trusted Medicare advisor and they save Ramsey fans an average of $1,100 a year they explain your options simply and help make the smartest decision for your Situation and whether they find you a better plan or confirm you're already in the right one chapter services Don't cost you a thing Medicare annual enrollment runs October 15th through December 7th So review your plan with chapter now and avoid expensive mistakes later to talk to the unbiased Medicare experts at chapter go to ask chapter dot org slash Ramsey or click the link in the description That's ask chapter dot org slash Ramsey Welcome back to the Ramsey show and the fair winds credit union studio. I am Rachel Cruz hosting this hour with George camel co-host of smart money happy hour with me as well and we're answering your calls So the board is full as we speak, but call in triple eight eight two five five two two five We'll see if we can get you in in the next hour to answer your questions about money. All right. Let's go to Fort Wayne, Indiana And we have Tyler on the line. Hi Tyler. Welcome to the show Hey, thank you so much for taking my call. This is incredible. Absolutely. So You know quick and short to the point my job moved a year ago due to a building closure and My 15-minute commute turned into a minimum 70-minute commute So yeah So my question is Is it unreasonable to force it where to consider for footing are only that of a hundred thousand for which is our mortgage At three percent interest rate our payments only eight hundred nine dollars And exchange to get You know, we'll say 40 minutes or a half hour Closer to my job the issue we've had um and and making this is we purchased our home Pre-Covid for 174 typical ranch out in the country point bar and etc It's worth three hundred to two fifty depending on who you ask That to keep our mortgage the same moving closer to the uh to work that same Price point um, I don't want to say it less nice, but we wouldn't be happy With with that, so we'd have to go up to Four hundred four hundred fifty to have it equal within situation if you will and we just don't know what's so comfortable one of your expertise on that What's your income Mine this year On track to make one forty Of my wife Around 40 So we run 80 in a row Okay, so she's 40 180 total okay, nine thousand among the main home after every time it's taken out How much would that be before retirement taken out Um, what should I say my checks About 22 2500 a week Um, who's Um about the same every two weeks Okay, nice so here's the deal even if you moved up in house as much as what I heard because your mortgage payment is so tiny right now It's still going to be such a reasonable part of your take on pay So if it's less than 25% of your after tax monthly income go for it because you're going to increase your quality of life. Yes Because right now 140 minutes round trip every day is what you're talking about 90 minutes Yes, an hour and ten, and which ultimately translates to about 40,000 miles annually on a vehicle. I sold my truck I had because the gas guzzling bought a paper cache, a little small EV car that cut that bill and just to a fraction of what I was paying in fuel cost. But still, my life has been eight away from the highway. Yeah. And what were your new mortgage bill? How much would you take on? To get an equivalent what we have out in the country is closer. It would be almost about 2000. Yeah. I just ran the numbers. It looks like 1800, but you could go up to 2500 to stay even within the parameters. So you guys are still, it's still very conservative, Tyler. Just on a retrospect to like loosen a little bit of like, you guys would be fine. I know it would hurt. But your quality of life, I'm like, oh my gosh, if you could get 30 minutes close to work right or 20, you're saving almost an hour and a half, almost two hours, like, it's pretty wild. Right. And it's been nice. Give kids. Pay cash for it. We do. We have one that is graduated. We're paying cash for her. No. Wow. Future endeavors in school. And then we have a first grader. That's obviously our next concern is we don't want to wait until we're, we'll say totally vested with him being in school. Right. I get that. Separate him. Yep. He's in first grade. So that's why we want to kind of make a move sooner than later if this is what we want to do. Is the area that you guys would be moving to a good area like has it for a family and school system and, you know, life, like your life in general, not just the commute side. Would it be a good move? Is it exciting? I mean, I think we would, we would enjoy it. Um, I mean, we live out into the proverbial boonies right now, um, so we don't want to go into town, necessarily and have neighbors, um, both where that comes at a cost. Hey, listen, the way, pesky neighbors and the way a eyes go and you may want to be off the grid. So Tyler, you might be. The boonie sounds mighty nice. She's. You may end up moving back out there. No, I'm just kidding. But it did overall question. I found this to be true that the low interest rates are a curse for many people. Just become golden handcuffs where they go, well, we wanted to move, but we can't let go of this low interest rate. I'm going, the way Tyler's going, you guys could pay off this house in seven years and have a zero percent interest rate. And so that would be my goal for you guys is to choose the life you want and, you know, date the rate, knowing it's going to change. It'll fluctuate. You can always refinance later. And more than likely, you'll just pay the dang thing off by making extra payments to where it's a mood point a couple of years from now. But overall, it sounds like this is the right move for your life right now. And very conservative still, just so you know, I mean, you guys, I wouldn't jump into six percent rate was going to make this payment 50% of your take home pay. We'd say, well, it's just too much house in general. That's right. That's right. All right. Let's go to Avery and Tyler Texas. Hi, Avery. Welcome to the show. Hello. Hi, Avery. Are you there? I'm here. Hi. How are you? I'm doing great. How are you guys? We're doing good. How can we help? So I am 19 years old. I have a job that the payment is kind of different. And I make anywhere from $5,000 to $9,000 a month. Okay. And I'm kind of in the stage where I'm saving up for a down payment on the house. I'm having trouble trying to, I guess, get myself to have a little phone with my money. What does that look like for you? What's something you know you should be doing more of specifically? Something I should be doing more of? Yeah. You're saying I need to have more fun. What does that mean? Is that going out with friends? Is that going on a trip? Is that buying something? A car? Yeah. I mean, it's kind of like, I have a fun life. I'm doing my life, but I guess like take it's like events stuff like that that I'm just kind of, I know I can't afford, but $300 for a ticket is also $300 away from a down payment on the house. So I'm just kind of curious is like my MI supposed to do that, I guess. Well first and foremost, I would not feel like you have to or should, you know, X, Y, and Z. What you want to do, what you enjoy doing. The problem people get in trouble with with money when they are of savor, which it sounds like you are, is they end up being controlled by money so much that any decision they make where they have to let go of anything create such anxiety that the money now is a burden. And it was supposed to be the thing that actually frees you to make decisions and have options. So yeah, I would say I would personally budget every a percentage of your income that you can just spend and enjoy and force yourself to do it. Get free. But there's a limit, right? You could say up to this point because you have a goal for a down payment and you're going to need X amount saved each month for that to hit that goal. So if you map it out in a budget, you actually give yourself permission to spend. So I would, I mean, I would force myself to spend a percentage of my income to enjoy it because that's part of this whole holistic part of money with you. Hey guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now you can get that same kind of help anytime with ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show, whether you're making a decision or just want something explained, ask Ramsey is here to help. It's fast, simple and free to use. Go to RamseySolutions.com and try Ask Ramsey today. That's RamseySolutions.com. Now our question of the day is brought to you by Why Refi. Sometimes the hardest financial step is the one that you have been avoiding. And if your private student loans or past due, Why Refi can help you explore low fixed rate refinancing options and payment plans tailored to your circumstances. So go to whyrefi.com/ramsey may not be available in all states. Today's question comes from Elizabeth in Nevada or Nevada as they say. Now I'm a Nevada girl, Nevada forever Elizabeth says I'm fortunate to work for a company that puts 15% of my salary into my 401k without me having to contribute anything. Once we wrap up baby step three and star baby step four should I add my own 15% in addition to my employer's contribution or direct that money toward paying off our house instead. My husband plans on contributing 15% and his company will match 10%. Goodness gracious. These employer matches are crazy. Well done Elizabeth in Nevada, that's a good plan. Well the plan doesn't change. You're still going to invest 15% of your own salary, which I know sounds crazy, but you're putting 30, let's see you make $100,000, you're putting 30 grand away, only 15 of that is yours. Yes. That's pretty incredible. So I always tell people if you have too much money and retirement, you can write me hate mail, you can send me a check, whatever you want to do. It's up to you. But I love the idea of building that muscle of investing because you may not have this job forever. That's right. And so it's great to just go, I can live off 15%, I can live off of 15% less than I make. Yes. No matter where I work, I'm really good at investing. That muscle is built up and I think it's easy to get a little acodasical when the employer's doing all the work for you. That's right. And that's why we even say the employer match in general, even if it's 3%, obviously not 15%. If it's 3%, 5%, it doesn't count towards your 15%. Because you're exactly right, George, there's something about putting your own money away and knowing that, hey, I can do this. You always say, eat the vegetables first, just do it and then you have like a lot of freedom than to say, well, we really can enjoy and be very generous, like there's so much freedom and knowing that what is taking care of, that needs to be taken care of, is done. And I'm telling, I mean, I don't know how old they are, but if they've got a couple of decades on them and they're investing this much, it's insane. Does she say how much she makes? No, they don't say. I wonder how much they make it. I don't know, but I feel like this is a pretty, you're doing pretty well. This is not like a, I'm making $12 an hour in my employer matches 15% of my salary. Right. This is probably, they're making good six figures together. Well done. Way to go. Good job, Elizabeth. All right, let's go to Valentina, a beautiful name. And Nashville, here at Nashville, hey, welcome to the show. Hi. How are you guys doing today? You're doing great. How can we help? Yeah. Well, I was calling because my husband and I just welcomed our first baby, a little boy. Congratulations. Thanks so much. We're over the moon about him, but we currently have $33,000 in debt. And we've been working on paying off our debt. We don't have much in our savings. My husband works a full commission job, so meaning that his income is, like, it's a variable. I do have a base pay, I return, I go back to work next week actually, I work as a peri-legal. The last question is how should we be prioritizing paying off our debt, saving money with his variable income as well? Well, it really, it stays the same with the baby steps, so that $1,000 is still that starter emergency fund, and then everything else you guys will throw at that debt. How much do you guys make a year together? So together we make this year, we'll clear, I just got a raise, so it'll be $160,000. Oh, good. Well, the good thing about this is you guys won't be in debt for too long. I mean, how quickly do you think you could pay this off? Well, our goal is to have it within a year or sooner. Okay. Yeah. And if you really ramp it up and you do it in nine months, then again, that starter emergency fund is only there for nine months, and everything has been thrown to the debt. And then if something does come up, and this is true for anybody, regardless if you have kids or not, if something comes up, then what you were throwing at that debt, which would have been what probably $4,000 possibly a month, just if an emergency happens, don't throw it at the debt that month, fix the emergency, and for sure that amount of money should fix most things, that $4,000. And if you have to pause for one or two months to fix whatever life throws at you, you do that, and you just do it at the speed of cash. And so instead of it going to debt, you use that money to fix the emergency. But for you guys for nine months, we'll just, you say a prayer and be like, all right, I think we can go through this. Is he making zero in a given month, or is it like it fluctuates between four and six? So for him, actually, it's fluctuated between like $6,200 to $8,000. Oh, right. So he hasn't had a zero dollar month. No, that's correct. So here's what we're going to do. We're going to budget based off of the floor. His lowest month and last couple months, we can say we know it's going to be at least six. Let's add that to yours. Let's budget off of that. And then anything above that goes toward the debt. Yeah. So you guys will be budgeting your income with saying we're going to be throwing X amount of debt. And if he makes extra, that's an extra to grant to throw out what was already budgeted to pay off the debt. So yeah, this will, this could speed it up pretty quick. And I would have it. I would have an aggressive goal of how are you guys with this awesome income and this small amount of debt comparatively just aim for six months. And if it takes seven, we're still going to cheer you on. But that's five and a half, that's $5,500 going toward the minimums plus extra. If you can just say $5,500 a month goes towards the debt no matter what, then we're going to, we're going to make sure our bills are paid, of course, and insurance and all that. If you guys can just focus as a team and go $5,500 must go towards that this month, you'll be done at six months. Yeah. That's amazing. Incredible. Great. Let's go to Daniel and Sacramento. Hi, Daniel. Welcome to the show. Hi, Rachel and George. We're doing great. How can we help? All right. So I have a question for you guys about whether be wise to sell my house so I can cash flow nursing school to give you guys some quick stats on me, 37 years old. No kids, not married, 105,000 is my gross income. I do have $30,000 in a personal loan and $9,000 remaining on the student loan. My house is valued at anywhere from $525,000 to $550,000 and I owe $375 on it still. The two programs I'm looking at, they're both bachelor's and nursing programs. So one of a two year state program that's about 30,000 for the two years. The other one is a accelerated one year program that's almost $100,000 for the one year. And so that's why I don't want to go back into debt obviously for that, but seem like the house would be a way to cash flow that, but also I'd hate to sell the house and move out of that. But getting like $175,000 in equity to fix a $30,000 problem, it feels out of balance to me. Yeah. And with the salary being, I mean, I make 105 as a nurse here in California, it probably be 150 to 180 is what I kind of research around there. And obviously that's a big enough jump, but I don't know if it's worth, it's enough to offset selling the house, considering how expensive the houses can be in California. Yeah. What are you doing now for work? For the state government, I'm the manager. And what is the, what's driving the urgency around this? Does this have to happen in two months from now, or can it happen a year and two months from now? No, so I mean, I finished up most of the pre-rex. So right now I'm kind of in preparing for the application season. So if I were to into a program, it's probably either the summer of 27 or the fall of 27. Okay. I mean, if it's 15, if the $30,000 for two years, is that 15,000 then per year? Yeah. That's my guess. That's 30,000. I mean, I don't know, Dan. I would just work extra and save. Yeah. Can you kind of just cashflow this thing? It's basically like a, yeah, like a thousand bucks a month will get you to the fall of 27. Well, because the only thing is with these programs, given the nature of my work, I can only work money through Friday, eight to five, and these programs are full-time. So I'd have to leave my job in order to do these programs. So I have no income for two years. Correct, yeah. Yikes. Well, that's not really going to work. So you're thinking about living off of the equity of your home to do it. Yeah. And I have an uncle that has an ADU. I've already talked to him, and he's considered letting me stay there for the year or two years, rent-free, and then I just have to support myself. Can you work nights after doing school? Not at my current job, I have to work in school. No, no, but while you're in school. Is that possible? Yeah. I mean, if you could figure out a way to save up 15 grand between now and then cashflow it, and then figure out, hey, can I work nights and live on nothing while I'm in school? I would consider it, but I would not be going any more in debt, and I don't think I would sell my house for this. No. I would try to keep it, man. You're literating your wealth-building plan by going backwards and having nothing to show for it by the end. People ask me all the time, "George, what's your number one money-saving hack?" I'm glad you asked. Nothing makes me happier than helping another frugal friend. So here's the hack. Get on a budget. Seriously, how are you supposed to save money if you don't know how much you're spending in the first place? And that's what makes the every dollar budgeting app a game changer. With every dollar, you'll get a clear picture of your spending, and from there, it's easy to see where you can get more intentional, cut back, and save more money. How much money are we talking? Well, the average every dollar budgeter frees up $395 in their very first budget. And if you ask me, I think you're way above average. So why are you still listening to me? Go download every dollar for free and start saving more money right now. We wish we could get to every call and question here on the show, but it doesn't always happen to us. There's only so much time in the day. Only so much. I know. So if you do have a money question, though, and you want an answer to your situation, head over to our website and use Ask Ramsey. So this is our free AI tool that's built and trained on proven Ramsey principles. And you will get your answer, your money question answered the way we would answer it here on the show. In fact, it's even so smart, George. It has some follow up questions to get your specific numbers and exactly what you need. And it's even the questions we would ask you here if you were calling in. I've said a lot of people there in the DMs, I'm like, Hey, listen, Ask Ramsey is going to be way better than me trying to fat finger and answer the DMs. It's much smarter. So true. So go and ask your question today at ramseysolutions.com. Or you can click the link in the description if you're listening on podcasts or watching on YouTube. All right. Let's go to Lynn and Nashville, Tennessee. Hi, Lynn. Hello. Thank you for taking my phone call. Yes. My husband and I had been married for over 40 years. We were debt-free. My husband still works. I'm not sure when he wants to retire, but we. I recently found that he has been taking money out of our CDs. We have a couple of CDs, there's a step CDs and they mature at different times. And he takes the interest and the principal out of those accounts. And I don't know what he's been doing with the money. He's been doing this for over a year. I just found out about it. When I have confronted him, he said he doesn't remember what he's done with the money. I went to the bank and I found out that there's another CD that he opened up. My name is not on it. And I know that there's a large sum of money in that. I feel like I just don't know what to do. This is just totally out of character for him. I just don't know what to do. I don't want to open up my own account and throw money in there because that's what he might be doing and that's not how I roll. Sure. Sure. How much is in the new CD? The close to 40,000. Okay. And how much is in the CD that you have your name on as well that he's taking money out of? Oh, there's a toilet while the. - Between, well, for all of them, probably 150,000. - Okay, and how much has he taken out of that 150? Is it 40,000 total? - No, well, no. Out of the CDs, the past year, he's taking $8,500 out. - Okay. And I don't know what to do. Yeah. If he won't tell me that I don't think he's telling me the truth and I don't, you know, the bank won't tell me if he has, you know, secret accounts somewhere. - Yeah, so you're worried. - Okay. - All you can see is the withdrawals that are on the CDs, your name is also on. - Yes, 'cause they're part of our trust. - Okay. - So it comes out to be about $800 a month, kind of is what he's been taking out of these CDs. - Yes. - Okay. - Yeah. - Is he taking cash? - Yes. - And then the cash should disappear. I mean, we don't know where it's going. And when you confront him, he says, "I don't remember." - Yeah, he said just stuff. - And then you found a $40,000 CD that you didn't know about. - And you've confronted him about that? - Yeah, have you asked him about that one? - Yes, I did. And he, well, it is, when we set up our trust in January, I asked him in front of the lawyers, "Do you want to, should we tag some of this money for our grandkids?" And he said, "No, we'll just, you know, our children can do that when we're dead." Well, this CD is for our grandkids, which is fine, but he didn't tell me about it. And my name is not on it. And he's been contributing to that. So, and when I did ask him about that CD for our grandkids, he said, I said, "Why did you do that?" And he said, "Because I want to make sure that they get some money." - So, how much do you guys have total? You're net worth? - Oh, golly. Over, probably 1.2. - And that exact includes your home? - Yes, it does, okay. - Okay. Yeah, I mean, I guess my concern would be what you're probably calling in about, 'cause $850 a month at this point, I mean, that's kind of like a, it's not the end of the world. I just don't like that he's not being honest with you, and then there's a count over to the side that he's funding and says it's for the grandkids, which is great, but it's just that you, you feel out of the loop financially. Do you guys still have a history of talking about money? Do you feel like you were on the same page up into this point? - Oh, most definitely. I mean, whenever we wanted to get our children some money, you know, I would say, "What are you thinking?" And he would say an amount and I said, "Well, that's about what I was thinking." We've like 98% of the time, we've always been right on. This is just a stab in the heart. - Does he know that you feel betrayed? - Yes, and he has not often an apology, and that's, you know, that's a tilt sign to me as well. - Do you feel like you guys have been pretty distant in your marriage in general? - Yes. - For how long now? - Quite some time. - How old are you guys? - He's 76. - Okay, okay. - Yeah, Lynne, I mean, I think what you've presented to him is totally fair and that you have a lot of fear is what it sounds like. Like you're scaring, you know, that you're scaring you because it's out of character, it's not how it's always been. And I would lean on that less about the amount of money here or there, and it's more about keeping you guys unified, for the next, hopefully God willing, two decades or eight or more. And so I think that would be my suggestion to you. I don't think you fix this by going and opening up your own account and all of that. But if there is a weird pattern, Lynne, and I hope there's not, I hope he's just a seven year old man, and he's just, I don't know, his head's in the clouds a little. I don't know, I want to give him the benefit of that out, but I also, we've heard crazy stuff, you know, on the other side of the spectrum too, on the show. And so I do want to honor your fear and not just brush it off. That if there does seem to be something weird going on, pattern wise, over a period of time, that I would, I'd pull in, even a third party, I don't know if you'd go to, you know, counseling at 70 years old, probably not. But that or, yeah, I don't know, figure out. - Keep having this conversation to see how much you can actually extract from this, to see how much you can get to the bottom of it. I mean, if you just said, I need this to stop, I need to see everything, every account, the transactions, the balances, no exceptions. I need you to rebuild the trust that was lost here. And if this is about something else, just tell me, we can be honest with each other. We've been married 40 years, if there's something going on, just give me the respect to tell me. And if he can't even do that, then you need to decide how are we going to move forward in this marriage? Do you need to go talk to a family law attorney just to know how to protect yourself out of fear? So that could be a step down the road if he is unwilling to budge. And that's him opting out. I don't want you to feel like you've done anything to deserve this, but I think you guys have just drifted so far apart that he's just in his own world at this point. - Yeah, are you a big spender, Lynne? Like, would there be any reason that he hesitates to like keeping a count? 'Cause he's scared, you know what I mean? Like, has there been anything in that end on your side? - No, I'm really conservative. - Okay. - You know what I'm saying? And I've had part, you know, I've had full-time jobs or I was a stay-at-home mom for a long time and I've had jobs, but nothing was good enough as far as income that I brought in. - To justify anything else, yeah. Well, I think the rebuilding the trust at this point from an emotional standpoint is gonna be huge for you guys, but I'm so sorry that does feel like whiplash on what a direction you saw everything was going and then you kind of get this bump in the road. (upbeat music) - Hey guys, Rachel Cruz here and I am so excited to tell you that the brand new 2027 Ramsey Gold Planner is available now. Guys, this is the only planner with exclusive monthly content from John Deloney, Jade Warshaw and me to help you set clear goals and actually stick to them all year. But here's the thing, these sell out every single year. So don't wait. Order your new 2027 Ramsey Gold Planner for $49.97 at ramseysolutions.com/store. That's ramseysolutions.com/store. (upbeat music) (upbeat music) Our scripture of the day comes from Proverbs 14, 23. And all the toil there is profit, but mere talk tends only to poverty. Opportunity is missed by most because it's dressed in overalls and looks like work. Thomas Edison. - Hey, man. Just the overalls, you know? - I generally avoid overalls, so I- - I was gonna say, I don't know if George would, I think he may pass on that offer too. I'm gonna have a reason to get a pair, it's all. - That's all, that's all. All right, let's go to Andrew in Charlotte, North Carolina. Hi, Andrew, welcome to the show. - Hey guys, how are you? - We're doing great. How can we help? - Good, well, I have a move coming up likely next summer. I'm right outside Charlotte moving up to the northeast. We own our home. We have about 180 left on us. The question is, do we take the equity of the home when we move 'cause we don't wanna be long-term landlords and pay off debt, or do we save it for the next house? - How much debt do you guys have? - A lot, 250-ish. - Oh man, what's that in? - Student loans is most of it. So about 130 is nice to own, 120 of my wife's. And then by the time we move, we should have like, we have a car payment, credit card, and taxes that are all doing. I expect those will be done in the next nine months. - Whoa, so what's the total balance of all this? - So the car payment or the car loan is 18. The credit card is less 55, and then the taxes is 3,000. - 55,000 in credit cards? - No, 5,500, so. - Okay. - Yeah. That's better. Okay, so how much equity do you guys have in the home? I'm thinking around 200 to 250. Okay, so you could clear most of the poor COVID, so what is y'all's degrees in? Oh, you don't want to know. Yes, we do. What is it? Education. What are you guys doing for work? My wife is an educator, she's in the admin side now, and then I am warehousing where I run a warehouse. What do you guys make? I make about 110, and she makes about 80. Good. Okay, so you'll be making 190 when you make this move. And what's the reason for the move? So a promotion, so I'll be probably making 50 each more. Okay, great. She'll go up to 160, and she'll still make 80. Well, she'll probably go up to 90 or 95. Oh, incredible. That's good. Well, we're seeing comparable roles. So think about this future. You guys sell this home. You take all the equity, dump it onto the debt. Now, you're making 250, and you can knock out the remaining, what, 25 grand? Yeah, pretty cool. In a couple of months, making that kind of money. Yeah. And then save up for a down payment from there, because that's really the order of homeownership is to be debt free, have a fully funded emergency fund, and at least a 5% down payment. And so you guys really would just be going into that baby step order at this point. Which means a rental for at least maybe two years max. Yeah, so what is, you know, that's kind of what I expected you guys to say. But one of the, one thing to hear Dave kind of reverse engineer this a lot. Say if I wasn't going to move, would I still sell the house and use the equity to pay off that? I've never heard that exact analogy. We just say selling a house is one thing you can do, but it's usually a last-ditch effort. But since you guys are already burning, you're already going to have to move. So the home is going to have to be sold because of the situation. So the question is, what do we do with equity? Yeah, I don't know if we should call it to the baby steps. That's right, that's right, yeah. Yeah, I don't know if we would make up that situation of selling a home if you didn't have to. But you guys are forced to anyways. And so at that point, yeah, there's going to be money there. And so if there's any extra money, we say apply it to the baby steps. And so that's what I would say. I mean, even if you called in and you had like a lawsuit or you got money from a relative, like we would say, don't use that to pay off the home. We'd say use it to pay off your consumer debt. So any amount of money you get in your hands, you apply it to the baby steps. And think about freeing up all those payments. I mean, what are the minimum payments on all those debts every month? So my wife's student loans are still zero. Which is her last degree of deferment or whatever. My student was 1200. The truck payments about five. Cut occurs only like 200 bucks. And then IRS and paying 500 minimum of months. But I'll pay more. So just alone, you're going to clear 2500 without her student loan payment. Which I'm sure is going to be another, you know, what, 1500 bucks? Yeah, I'm sure. So that's four grand, you'll clear. That's now back in your pocket every month for you guys to build wealth. You're not paying interest on it. And to throw it at an emergency fund and then finally a down payment. I'm like, that's especially with this raise. You're going to be yeah. How old are you guys? Andrew. 30. Okay. It's great. You got time to clean this up. And it sounds like a good career move to for you all. You know, all moving up and income. And I think it's just, yeah, it's just kind of reordering the priorities of where your money should be going. But it's best, you know, where's the best place for it? And at this point, paying off this consumer debt, getting that done with, oh, it's going to feel so nice. I'm looking forward to it. Yeah, for sure. Yeah. And I do think the battle of going from owning to renting can be really hard for people. It feels like you're going backwards. You're throwing away money on rent. I'm putting this in giant air quotes because I don't believe that. Yes. I know. And I do what people don't consider because we get this call to all the time is how expensive home ownership is. You know, unless you're living in a condo, I mean, you're in charge of so much, so much that can go wrong. We love home ownership. We want it. But you have to understand what you're walking into from everything from HVAC to roofs to landscaping and fixing stuff when it breaks. I mean, it's just, it is a, there's always something you want to do and need to do. Yes. And when you got four grand and dead payments on top of no savings, just to say we got into home, it's not worth it. It's going to get stressful real quick. You'll call the show a year from now going, should we sell the house? We bought too early. This was a mistake. That's right. I don't want that for you. Yeah, because we get that. We get that call. All right. Let's go to Steven in Portland. Hi, Steven. Welcome to the show. Hi. Thank you for taking my call. I really, really want to find out if you had any advice for somebody who's just turned 60 this week. And I'm literally starting over after a divorce and some really, really poor spending choices. By Mariax, why if you lose a real number for 24 years, making incredible money. And then also making horrible choices, expensive cars, private schools, only money to the IRS. And she was self-employed. I wouldn't go on to or, you know, to worry about all that. But basically from going from a really nice situation. Well, speak directly in your phone, Steven, or have a hard time rearing you. I'm sorry. Can you hear me now? That's a little better. Yeah. I have a bad cold, so that could be it. So anyway, I am trying to figure out. I have a $27,000 for entertainment at a $5,000 credit card. I used my return that money to recently get my daughter to her school pay off $25,000 to the IRS. That was a debt that wasn't mine. I basically got out of a horrible financial situation. Yeah, for I was building down here quick. Okay. How much do you have left from retirement? I'm not worth $40, $40,000. What's the car worth? Oh, probably about what I want it. And how much do you make a year? So I put my girl up to go to a little less stressful down up. So now I'm going to be making about 85 a year. Okay. I use a girl 70, 75. Okay. Do you have any savings right now? Anything liquid cash? I don't. I literally have helped my kids with everything I have. So Stephen, we got to stop that because your your children will have to cover you in a retirement. And that's not going to stop. There's going to be down payments for their first home. There's going to be weddings all of it. You have to take care of you first. You got to put your oxygen mask on first, Stephen. So you can't you don't you can't afford to be helping anybody but yourself. So you need to take your income. You need to be paying off this debt. You may even want to sell the car and get a beater just to ease up the payment. And then start refunding your retirement. And all of that has to do before you're helping anyone else. But I'm sorry. That sounds like a hard hard year. Oh, thanks for the call. All right. Thanks everyone in the booth. George always a great host co-host. And remember, there's ultimately only one way to financial peace. And that's to walk daily with the Prince of Peace. Christ Jesus.