Behavior Matters More Than Math

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“>> Normal is broken, common sense is weird,”

so we're here to help you transform your life. From the Ramsey Network and the Fair Wins Credit Union Studio, this is the Ramsey Show. I'm Dave Ramsey, your host, Rachel Cruz, Ramsey personality number one, best selling

author, co-host, and smart money happy hour. I'm Ramsey Networks, and my daughter is my co-host today. Open phones, a AAA, 825, 5225, and he's an Indianapolis. Hi, Andy, how are you? >> Good, how are you?

>> Better than I deserve, what's up? >> Yeah, well, I'm 50 years old, married, two kids. I'm going to get one off the college here just now. And we're in a situation we're leading in the last year, had corporate buyouts, cap my pay, and really cut my pay significantly.

And in the process of trying to make up that income, my wife became severely ill and we're heading towards disability. So she's definitely disabled now, we're looking at, obviously, she should have run disability years ago, but we had trouble getting her there,

“do the various reasons with her sickness and the diagnosis and whatnot.”

So we've kind of made it this far, trying to put bandages on everything. Two credit cards maxed out. We sort of foolishly took the opportunity to take mortgage for parents. We were kind of doing it at three months at a time. And through the end of the mortgage for parents here this year,

they will not differ our payments. So they're asking for $13,000 to keep us out of foreclosure. We weren't aware that after six months, they can't differ payments. But we're in a situation where we're going to file

chapter 13 bankruptcy and restructure,

but I wanted to talk to you first.

>> Andy, I'm so sorry, it's a lot. So you have $13,000 that you're behind on your home today. >> Correct. >> And they wanted to buy the end of the year. >> They wanted by the end of this month.

>> Okay, so that's a train that's been coming down the track for a while. You've seen it coming for a while though. >> Absolutely. >> Yeah, okay, but now it's down. >> Okay.

>> We thought it was going to be temporary. >> What is your home worth? >> It's the spot 360. >> 350,000? >> 350.

>> Correct. >> Okay, and what is the mortgage balance? What's it take to pay it off today? >> 150,000. >> Okay, all right.

And what do you make now? >> So I just started a new job at a year and a half ago.

I used to be on commission, so that was always another thing too,

with trying to manage cash flow. But I'm on salary now at 90,000 a year. >> Okay, that's good news. All right. And you have two credit cards.

>> Total balance is on those. >> The balance is on those or what? >> 18,000. >> Total. >> Total.

>> Okay, all right. And how much on your cards? >> One card paid off. One card we have 8,000 on. Pin 278 a month for it.

>> Okay. >> All right. And what are the debts? >> We have 2,000 in medical bills. Usually, that's kind of a standing number.

It seems to the road. We have an 8,000 dollar deductible right now. Previous years, we had a $15,000 deductible. That we would max out and then I refide the house twice in the last handful of years.

>> Why? >> Just to pay off credit cards that we had used for medical expenses. >> Okay. >> I know it's extremely foolish. >> Okay.

But we keep thinking we thought it was temporary. You know, I kept thinking she was going to get better. You know? >> Okay. Well, the reason I'm asking all these questions is

“it's the only way I can get to your answer.”

A chapter 13 bankruptcy takes the balances that you have and you have to pay the minimum normal payment plus something on the average, on the car, and on the house for 60 months for five years. Okay. Your unsecured debt can be paid back on a formula that they use

when they're calculating it.

So pretend like they gave up half of it.

“So you had $9,000 that would be in the five-year plan as well.”

Okay. So you're going to be in there for five years. And you're going to pay every dime that you owe on the house. It just spreads it out. It's all it does.

Okay. There's no deal. There's no back of the mortgage. So that $13,000 is going to be spread out over 60 months, plus your regular house payment.

So in chapter 7 bankruptcy, you're going to have your regular house payment. Our chapter 13, you're going to have your regular house payment, plus something on this 13,000, whatever 13,000 to about about 60 is. Okay.

So here's what happens that 78% of the chapter 13's in America fail.

The people don't make it through the 60 months. Because they can't make the payments. And we already knew that because they couldn't make the payments. And that's what put them here. You follow me.

And so that it's like when you refinance the house and didn't change anything. And now you got new credit card debt after that. Okay. So because you didn't change anything, you didn't fix what the actual problem was. You just treated the symptom.

And that's what the bankruptcy does. I always try to figure out a way if there's anything we can do to not file chapter 13. Because it is a bankruptcy. And then for the rest of your life, if you're filling on any form anywhere, this is if you ever file bankruptcy, yes, I have.

I filed a chapter 7 in 1988. And for the rest of my life, I get to answer yes. I have file bankruptcy. So I don't recommend bankruptcy. I try to figure out a way to avoid it where I can if it all possible.

But let's pretend that you paid the car payment. You got on beans and rice rice and beans. And you worked two jobs or three jobs more. And Andy, you didn't pay a dime on the credit cards. And you stacked up cash.

I bet you could scrape together the 13,000 before the foreclosure actually occurs. Which would be how long? Probably six months. Right. I see.

Get current on that. And then go work on your credit cards. Credit is going to be damaged, but not damaged as much as if you file bankruptcy.

“And Andy, I'm assuming you have nothing in retirement, right?”

No 401k's. We empty that years ago with her diagnosis. What's her diagnosis? What's her diagnosis? Oh, chronic neuroline disease?

Oh, wow. Okay. It's been controversial in the previous years. I'm not sure. Yeah.

I got a lot. We lost the team member to disability. We didn't lose his life. But he lost his, lost him to disability. It was a big deal.

Exactly the same thing. A few years back. Oh, man, that's harsh. Well, you remember the stimulus we received. We back when the Biden stimulus.

We spent that on a $3,000 test just to confirm whether treatment for working or not. For example, you know, how to pocket. So hoping that changes. We're hoping insurance gets better.

Here's what not having insurance right now, either.

When I filed, I heard my attorney say something loud and clear. You're still in the exact same position you were, except for the debt. So all the things that are draining your emotions. All the things that are all of this medical, all the exhaustion of fighting and fighting and fighting against the system is all still there.

Bankruptcy didn't fix any of that. And really, that's kind of what caused you to get here. So what I would do is find out how long it takes for an attorney to do a foreclosure in your state and see if I can't scrape together the 13 by going all hands on deck.

“Before the foreclosure and avoid the bankruptcy, that's what my first goal would be.”

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[Music] Carrier is in Minneapolis. I carry how are you? Better than I deserve. What's up? Well, we have $50,000 old on a credit card. 17,000 on a car, and you're getting a tax return of 17,000.

I want to put that 17 tax return towards the car and get it done. I have been wanting to put it towards a credit card because it's a higher interest rate. Let's say you. Well, you know what we say. We say pay off small.

“We pay, say pay off small as to largest. You knew that, right?”

Yes, I knew that. I have been just wanting to do that credit card so that. Well, I would not do that. I would pay off the car. And I'll be smart. I like for a minute.

If we used his plan, we'd be where you are.

Exactly. Okay, so I don't need his advice. His opinion is invalid based on their pattern of his life. No, thank you. So now, my smart accent's done. Okay.

That's where you win the argument carry. Yes, the top win for me is that he wants to pay off debt. We have so many people that call in. I can't even get their spouse on board. So arguing about which debt to pay off to good argument to have. But the umbrella.

It's a positive. I'm glad that you guys are on page. I agree. I agree. Now that I got my smart. I like it. I completely agree.

So anyway, the, yeah, I would pay off the car.

And actually, here's the weird thing. I've done this a bunch of times because his. Anxst is that the interest rate on the credit card is so much higher than the interest rate on the car. Correct. Yep.

“That's what is that's the burden his saddle.”

And so if you said, do you have any idea what these two interest rates are? Do you happen to know the car is like five, five point something in the credit card. It's 18 something. Okay. So it's a 15 swing or 13 swing. Okay.

So if we do round numbers and just to make it really easy. Let's say it's a 10 swing. It's a little more than that, but not much. It's $1,700 a year. Is the difference 10% on 17,000 dollars.

Okay. Okay. So it's costing you to do it my way. $1,700 for the year. However, you don't have a car payment anymore.

And your car payment is what? About 500 over 500. Okay. And your household income is what? About what we, he brings home about 12,000 a month.

Okay. And $50,000 means that if we don't have a car payment, we should pay it and we make that kind of $12,000 a month. We should pay off $50,000 in about 10 or 11 months. Okay. So it won't even be a full year.

So it won't even be $1,700 difference. And the other difference is that you cannot calculate the sense that we have traction. The sense that we've done something big with this money. And what that does to the momentum towards paying off the rest of the debt,

that's hard to put into simple mathematics. And all we're doing is simple mathematics. How much is the credit card payment every month? I'm just curious. 50,000.

Well, well, the interest would come up to almost 600 a month if we just paid the loan. Yeah.

“Yeah. So you're going to put, you need to put $5,000.”

Yeah, without a car payment, you need to put $5,000 a month on the credit card. And be done with it in about 10 months, give or take. And so it's going to cost you about $1,700. A $1,700 is around down so we can actually be correct now. And yeah, it's also got the highest probability of actually succeeding.

And so having taught people this for 30 years, having done it myself, having literally gotten tens of millions of people out of debt, I'm going to encourage you to do it that way. Yeah, carry on. You guys started the process.

You said that this is going to be a tax refund check of 17,000. How much are you guys throwing a debt right now? The car and the credit card? How much are we?

Are you guys paying off debt right now or are you waiting on that check?

“Well, I want to say we're actively like glyphine beans paying off debt right now.”

So we're kind of waiting on that check. But this check has gotten me motivated to do the things in the beans and rice. They know like, let's get it done because it's momentum. I see something can happen. Sure, totally.

Totally. Yeah. Yeah, so 500 plus the 600 that you're already paying is 1100. So I'm asking you to come up with another 3900 out of your budget. And you'll be done in 10 lousy months.

And of course, you've cut up the credit card or you will tonight. And the two of your own same page and everything else. So overall, let's give him a, let's give him an eight out of 10 because he's under the umbrella of husband that wants to get out of debt. Yay. Like Rachel said, that's a big win.

That's a huge breakthrough.

So at that point, then we're only arguing about concepts, which is a fun thing to argue about, which played a call to win the Super Bowl. These are these are good arguments, right? That we get to have this question. And so it's a, it's a good thing. But I would and we would tell you to pay off your smallest largest smallest to largest.

So Rachel, here's the interesting thing. Okay, let's go in throughout the rest of it because everybody out there, this all the crap we get on. Oh, tick tack and read it and all the other stuff that the debt snowball is not mathematically correct. And that the avalanche method that some people talk about where you pay off highest interest rate to smallest interest rate is mathematically correct. And you will get out of debt faster.

The answer to that is, is that you're wrong. Because your math formula is incomplete.

“If you learn how to do sophisticated mathematics, you have to include probability of completion.”

The number of people that complete the debt snowball, because it gives them a positive feedback loop, is over 10x the number of people that actually complete the avalanche. Because the avalanche is emotionally, really, really hard to do because you don't get traction. You don't have something saying, "Wait a go, wait a go, wait a go." And every time you pay off that little debt, you get a way to go feedback loop. And that way to go feedback loop keeps you in and increases your chance of actually finishing the freaking program and getting out of debt.

Instead of having some kind of mathematical theory that you do nothing with and you get paralysis of the analysis. And so when you add in probability of completion, the debt snowball is far superior to the avalanche, mathematically. But now we've actually done some sophisticated mathematics instead of sixth grade math, which is how most people do their math, and that's what gets some broke. So in her case, it actually is more expensive. What I just told her to do is going to cost them more money.

It's going to cost them about $1,500 more, maybe $1,700 more somewhere in there, to do it the way I just outlined. If she does exactly what we just told her to do, and if he does exactly what we just told him to do, that normally is not the case though. Normally when you run the math out, it's like a month and a half, two months difference on how fast you get out of debt. If you work the avalanche precisely and you completed it, which almost no one does. Well, people do, I mean, they do, but probability is much lower.

Yeah, yeah.

“And so, and that's why when MIT did a study, they figured out that personal finance, and they came back and said on the front page of time magazine Ramsey's right.”

You know, because the debt snowball works because of the behavior aspects of personal finance. You're modifying behavior, you're not fixing math.

Well, and always the joke is, if you're $50,000 in credit card debt, you wouldn't be there if you were doing math in the first place with your bank account.

And which is kind of what I just did this a minute ago when I was abusing it, but, you know, if your math was so good, you wouldn't be here. So, that's the thing. So, the debt snowball is superior because you understand that personal finance, including saving, including investing, is more behavior based than it is actual math based. Another example of that is in our millionaire study, when we studied 10,000 millionaires, we found they weren't that great at picking mutual funds. Their mutual funds were good to okay.

They weren't bad, but they weren't the best. The difference was that they actually freaking put money in them instead of talking about it. That's the difference, so the behavior matters more than the math. [ Music ]

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Every dollar. Matt's in Riverside, California. Hey Matt, how are you? Yeah. You have a new world, but I got myself in a financial predicament with my father and lie, just can't figure out how to get out of prior to my wife and I getting married.

He purchased house for a million dollars cash.

And he pulled ahead $200,000 of her inheritance, leaving $800,000 balance for us to pay off in a mortgage. But he said he would help us out by just only charging us a 3% interest rate until the balance is paid off on a 15 year mortgage. So that's a lot of money. But I have no documented equity or ownership in the house for which I pay a majority of the mortgage, the maintenance, the repairs, the upgrades. And I find myself just digging myself every month into this deeper hole that I possibly, one day if something bad happens, I will just have no equity.

I've talked to her about it, Matt. I have to which he said to trust him and everything will work out. No, thank you. They won. Yeah.

Okay. So let's pretty, how old is he? He's 70. Okay. Let's pretend that his heart skips a beat as he's driving down the road, which could easily happen to a 70 year old.

And he loses consciousness and goes across the lane and hits someone head on. And they die. He's going to get sued for millions and millions of dollars. And it's going to be a lean on the property that he owns. You're screwed.

And he has put it in a trust in order to-- Doesn't protect it. It does not protect it from that. Okay. This is absolutely bogus. This is controlling beyond belief.

No. No. I'm not going forward with this.

“Would it be what it not little see that protects it in that case?”

I've nothing that'll protect it. I mean, the LLC is owned by the guy. You can go after the LLC shares. So the property, if you're going to pay payments on it, needs to be in your name.

There's no excuse for it not being. Trust me is not an answer. And he's worried that I would take the property potentially from his daughter. And I haven't nearly paid my half or a fair share of it. So how can we--

How long have you been married? We've been married over one year.

I mean, you guys do what you want to do.

But this is not tenable for me. Okay. I'm not going to live like this.

“So I'm sorry. I shouldn't have done this deal.”

It's turned out to be a really, really bad idea. And I wished I hadn't done it. And so we're going to undo it. We're going to let you have your house. And we're going to go by house.

Or we're going to refinance this. And we're going to put the $800,000 mortgage in our name. And that's 6% and 5.5% right now. And we're going to pay you off. And you're going to put the house in our name.

But we are not going to continue forward with the house only in your name. Period. How are your wife handle that, Matt? She's not going to be too thrilled. Because that's going to increase the interest rate inadvertently for us.

That wasn't necessary in her eyes. It's necessary because you don't own a house. And you're so freaking vulnerable that it's ridiculous. Mm-hmm. Your father-in-law says trust me, but he doesn't trust you.

Mm-hmm. Yeah, I need to go both away. This is not cool. Yeah, and my, and my fear mat is that a 3% interest rate is going to rattle your one-year marriage. You know what I mean?

If your wife is already taking his side and a level of logic, right, of just math, just like, "Oh, I just want to save money." And not looking at the relational equity of what this is doing. And then the potential risk of your home. Yeah, it's probably going to cause some waves,

but I would say it's probably necessary. I'm going to call somebody. I'm going to start out general and I'm going to turn it up. Yeah. Start out kind and honoring and say, "I appreciate this.

I know you've got good intentions. I love you and I appreciate this." But I simply am not going to go forward with this. It's not going to happen. Okay.

And it's not worth the 3% savings. Your risk that you're taking is astronomical. It's ridiculous. It's a horrible deal for you. And I asked my wife if she was in the opposite role.

My family had purchased this house and she was paying a majority of it. Would she be comfortable in this deal? And she says she wouldn't be comfortable. Well, then we have to decide are we going to leave our father and mother and cleave to our husband and cleave to our wife.

It's an old fashion saying you leave the father and cleave. It's old English from the old English Bible, but yeah, you. But we have to set up, okay, who's running your house? Now, her dad or you guys. And again, to me, I'm like, this is a totally different.

I don't like the idea of people using family as a bank. Right, people did this with student loans. I do it with mortgages.

And I just always, it's always a little achy and weird.

It just kind of changes the relationship. But the thing on top of it for Matt, for me. Isn't like if you guys start having kids and you're building a family, the place that you call home that is supposed to be your home.

“That's why it doesn't make sense to me of his, his logic.”

This is your home and her home, his daughter's home. And why he doesn't give you all the dignity of putting your name on the title of following through with the plan that's already agreed to. Um, is odd to me and his fear. I'm like, I'm a little offended.

If you're going to do this deal with me and be my banker and be the husband to your wife. And you can't trust me with it with a million dollar house. You know what I mean? Like, it's just like, oh, it just adds adds to the relational dynamic. Yeah.

Yes, it does indeed. And that's why I kind of lose sleep over it. And I see as everyone goes on, it's harder to bring up this conversation. Yeah. I think the two of you, you and your wife need to sit down with a good therapist, a good financial counselor.

I mean, a good marriage counselor and maybe your pastor, if you have one. And you guys need to talk through and then you need to decide what you're going to do. And then um, and you guys together, and I didn't even have a friend. Yes. You got to present it to him.

And yeah, together or you know, either going to, either going to refinance this and get it out of your name and put it into our name. Or we're going to hand you the keys. And we're going to move. And so because we're not going forward and listen, don't accept a mortgage from him either. If he says, okay, I'll put it in your name and I'll just put a mortgage on it.

No, I do not want to owe this man money. This has got a bad vibe on it.

“The best thing you can do for your wife and your marriage is for this guy not to be between you anymore.”

But I think his intentions are good. I don't think his intentions are bad. I just think he's emotionally immature. Mm hmm.

I would never look at Winston Cruz and say, I can't put this in your name because I don't trust you.

That's what I'm saying.

It's soap is it's so odd.

“I gave him the most precious thing I have on the planet one of my daughters.”

I don't trust you with, but I don't trust you with a stupid house. Oh, that's not worth it. No, thank you. Backwards. That's just emotionally.

Oh, Matt, I'm sorry, and your wife. It's going to be a hard process. It is. But dude. It's going to be good for you guys.

See you. Choose the conflict today because the one that's laying out there ten years from now is much bigger.

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That's joinJ-O-I-N-Deleteme.com/RAMSI or click the link in the description. Whether you're a person of faith or not, Proverbs is the book of the Bible that is called the Wisdom Literature. The mass majority of it was written by Solomon, which those of us that are Christians or Jewish believe Solomon to be one of the wisest men to ever live.

And he wrote Wisdom and the Book of Proverbs. And then we fast forward and it becomes our Bible or in the case of Jewish person, their Bible, the Christians would call the Talmud with the Jewish person calls the Bible. And the Wisdom Literature is most of us in evangelical Christianity or Orthodox Judaism, believe it to be literal.

And so that gives people trouble in some cases, but that's okay. The Barrower Proverbs 227 says, "The Barrower is slave to the lender."

Now everybody this listening think about this for a second.

How many times have we had payments to some organization, a car company, a credit card, a bank, and we resent that organization. We signed up for it. But by the time we finish paying off the truck, we hate Chevrolet.

Or at least Chevrolet in a General Motors finance. By the time we finish paying off the Toyota, we can't stand Toyota finance. By the time we finish off paying off City Bank, we hate City Bank. Make fun of the mortgage company name that you pay payments to. It's because slave seldom love their masters.

It's not literal slavery in the sense of you gave up ownership, but it is mathematical and legal slavery. And if you don't believe it is slavery, try not having it. Yeah, financial. Try not having it.

When you pay off your mortgage and you pay off all your cars and you pay off all your student loan, and you don't have a single, people, they stand differently. Well, it's a spiritual freedom because money is so tied to so much of our lives. And when you hand that part of your life over to someone else, it is a form of bondage. You've given them ownership.

Yeah, that there's not full autonomy over the work that you have created in the paycheck. That you've created through your work. So when Sharon and I went broke and we discovered that scripture among others, we decided not that debt is a sin, but that it's really dumb.

but we also have observed in 30 or almost 40 years of doing this now, that there's zero case that I'm going to loan money to one of my children. I'm going to loan money to another relative. I'm going to loan money to a friend because it instantaneously, whether you want it to or not. You don't have a choice in the matter.

The law of gravity is the law of gravity, whether you like it or agree with it. It changes your relationship with your friend to two good friends, from to master servant. And the old joke is if you loan your brother and law, a hundred dollars,

and he never speaks to you again, was it worth it?

Yeah, haha. Okay, but because it's severed relationships, it ruins relationships. And some of you try all kinds of ways to twist it up and make it okay, and figure out that the math works and all the other bull crap, and it doesn't work.

It doesn't work. It doesn't work. So if you have a friend that needs some money and you want to give them some money, give them some money. Period. No loan of money.

“If you want to help your kids get a million dollar house, give them a million dollar house.”

I got some questions about that, but before you loan them a million dollars, give it to them. See, what that does, it changes your decision then. Or my mom is 69, and she has no money saved, and she's paying rent, and I'm going to buy a house and let her rent it from me. No.

You just changed your relationship.

Your mother is now your freaking renter. How dumb is that? That's just dumb. Think about it. That's relationally inept.

No, if you have the money to buy a house and pay cash for it, and your mother live there until she dies free, fine. Or you pay her rent somewhere. If you want to write her or some check for it to give her some money every month to help her with her rent, fine. But don't make her your renter. Good, Lord.

When you say that out loud, it just sounds dumb, y'all. And yet some of you have figured out all the intellectually, this is the best I can all have the investment, and at least I know the tenant. What? Yeah, she changed your diaper, you butt. And now you're charging a rent.

Unbelievable. Yeah, you know your renter. Kea Lee.

“And if you have to have the rent in order to pay the mortgage payment, you shouldn't buy the house.”

Exactly, you can't afford the house. You're doing crap, you can't do. If you have to have the return on investment, you can't afford it. Don't do it. Buy a rental property and put a renter in it.

If that's what you want to do. But don't do this to your parents. Don't do this to your kids. Don't do this to your cousin. Don't do this to your friend.

Expect them to be a friend. The number of families that are split up.

And never speak to each other again.

Over a couple of thousand dollars that was handed to somebody. And no deal was really made. Just pay me back when you can. And then four months later, you're like, "How do I need that money back?" The borrower is slave to the lender.

Stop it. Stop it. And another version of that's co-signing for them. Proverbs 1718, "New King James says, "One lacking in sense. Co-signs for another."

The contemporary English version says, "If you co-sign for someone else, you're stupid." That's what the Bible said. So you guess what? The bank doesn't want to loan the money. Because they don't think they're going to pay them. But I'll sign up for it because I think they're going to pay.

Even though the bank who eats lips and breathes debt more than anything, wants you to be in debt. Doesn't want to give this guy money, but you're going to co-sign for him. How ridiculously stupid is this whole thing? And yet it's very commonplace, and it's why most people are broke.

And it's why relational breakdown in the marriage is everywhere.

“So moms and dads, if you want to help your kids and you have the money, give it to him.”

If you want to put some stipulations on it, like, I don't want you to borrow money on this house if I give you a free house. That's a reasonable stipulation. I want you to stay out of debt because that's how we got here. That's a good stipulation. You should do that.

But then you don't go over there every week and go, "You bet to borrow money? Are you bet to borrow money?" You don't go, "You don't have a weekly check-in." No, stop it. You control freaks. And boys and girls, can you leave your mommy and daddy's house?

Leave. Talk about all the adults in the move back in.

Set up your own household to where you and your husband,

you and your wife are a family unit. And these other people are separate from you. You don't keep your mother cell phone planned. What do you 14? Get your own Netflix account for God's sake.

Hold on. This is one I just risked our own family on. If we're going to go, "I pay my own." I know. I pay my own, Netflix.

We have found out other ramps too.

“I just remember that my wife gave our code to one of the other people”

in our family, and I had a duck fit. I'm like, "You're a grown human being. Get your own freaking Netflix account. You don't need to suck off." That's ridiculous.

That's ridiculous. No, get your own. You pay your own insurance. Have a life. The worst, I think, is people sharing Amazon Prime Accounts

with their parents. I don't know when you were a toilet paper. I got a new mosh on and said, "I don't want you to know about it." Okay. I wouldn't have known anyway, but your mother might have.

No, but for real though. There is a separation to happen. It's very important.

And the problem is, we're going to pay the grandkids.

No. You're broke. Stop it. But be grown-ups.

“But if you have the money, be generous and give without strings attached.”

And be generous. Be generous. But then there's no strings attached. That's right. The borrower is slave to the lender, and you're not the freakin' exception.

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And use code date night. That's Angel.com/Ramsy. Or click the link in the description. Limited time offer visit Angel.com/Ramsy for details. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio.

I'm Dave Ramsey, Rachel Cruz, Ramsey Personality. My daughter is my co-host today. Jason's in Pensacola. Jason, how are you? I'm fine. How are you?

Better than I deserve. What's up? Well, I have some serious questions based on some serious advice.

But basically I have sick about five years ago.

And I've been in remission for quite a few years now. I was released to go back to work. But in that time, it was a month after we bought our house. That I found out I was sick. So I was a firefighter for 30 years.

And I was medically retired. Of course, I had to wait on the government to pay me for, you know, the government's got to accept me for being getting against her on the job. And then once they paid me, of course, I used my credit cards

just to keep my house afloat that we had just bought. And medical bills and other things. And so basically I have zero retirement. I'm 51 years old. Mary, my kids are grown and we own a house and about.

Not counting my truck payment about 40,000 in credit cards. Okay. And I don't know what to do. I just know that I'm tired of living like this. But you beat cancer.

You beat cancer, right? Yes, sir. Wow. Well, that's the number one victory, Jason. You're still here.

That's a big deal. Yeah. Congratulations. It's a hard road. Yeah.

Way to go. Yes. So, what's the truck?

What are you on the truck?

About 40,000. And what's it worth? I'm under. I'm upside down. And you're what about eight to 10,000.

So you looked it up, man. You can sell it for 30. Yes, sir. I've been offered 30 from the dealer.

“Tell me, believe, but they're dealer called man off of me that much.”

That means you probably can get 35 for it. Okay. That's a wholesale offer. Which is not evil. It's just a low offer because they're trying to turn it and make money on it.

Now, then, and your credit card debt is how much? About 40. So you got 80. 20 is between the between the end of life. Yeah.

But the so that, but you have 40 in addition to your so 80 total. Yes, sir. Okay, got you. And you are retired medically from the fire department. And you are paid what a month from that.

I bring home about 900. After all, my health insurance and everything comes out. 900 dollars a month. And then 900 a month. And then I went once I was released to go back to work.

I went and got a full time job. And I make that much of ring home every five weeks. And then I'm sorry. How much do you bring home from that job? About 900 by weekly.

Oh, I'm sorry. Eight hundred. Eight hundred. Eight hundred. And then my wife brings home about 14 something about weekly.

And I've never done. I just started. I was passed your name via the church. So I started listening to your podcasts about two weeks ago. And I know.

Well, I said on the first because I went and got a second.

I went and got a third and fourth job. So I'm side hustling about a thousand to twelve hundred a month. Okay. So we got about five or six thousand dollars coming in total then. Yes, sir.

I went from we went for making 99. Basically 99,000 a year. And then I'm bringing home about 1,000 a month. Between me and my wife, we're bringing home about 1,000 month with side hustle. Yeah.

Okay. So about 6,800. Yeah. With the side hustle. Yeah.

Great Jason. Great. You're not afraid to work. So it sounds like your health has recovered pretty well. Yes, sir.

I had. I just had a section of each kidney cut up. Okay. You're you're back. Okay.

So. Back and work. And I'm not afraid to work. Your new job is your new career. The 1800 is what?

I deliver a new clear medicine. Okay. It's a delivery job. Okay. Yes, sir.

Deliver a new clear medicine to hospitals. That's the way I figured I could still help. Yeah, sure. I was. They helped me.

So now I'm helping them. I just wonder, Jason, if you're able to sell this truck. Take out a small loan of maybe 14. Go get a $4,000 car. Have the difference of the 10.

Yes. Put all that together. And then you're credit card. If you guys can throw 2000 a month at this dad, you could be out in two years. Okay.

Which is. And then you're then you'll be in a position to rebuild your return. Yeah. Yep.

“Now the other piece that goes with this is, um, you made a lot more than this when you worked for the fire department, didn't you?”

Yes, sir. How worked it? I was not all firefighter. So I worked on the base. Oh, wow.

Okay. I wasn't civil civil civil service. Yeah. You were making, you were not in the 118 hundred a month. Yeah.

Okay. So yeah. We were making about nine. I was making about 90 before not even counting the life. Yeah.

And then we dropped it. Now I'm making about one with my retirement about 27. Okay. So. Yes.

I would sell the truck and get a $4,000 car and start working on the credit card that and work a job. That's what you're doing. Every bit of that makes sense to me. I also would tell you that. You're in chapter two.

Chapter one was a $90,000 firefighter. Chapter two is not an $1,800 delivery driver. That's a temporary stop. Yes, sir. So we got to figure out what chapter two is that's 90 or 120,000 a year.

Because you're only 51. Yes, sir. So you've got lots of time to do lots of things. And you know a lot about, you know, things in and around.

And emergency care, first responder stuff.

Yeah. There's a lot of options and things that you may be able to do there.

“And I would explore every bit of that and say, okay, what do I want to be when I grow up?”

Mm-hmm. I'm starting fresh. And what you did is you landed on your feet, got anything you could get.

And this is enables you to get back to work and help people, which is good.

But you're not making money. And so I want you to, I want you to go help people and make a lot of money. And because it cleans up your life. And it's the final step of your rebound is to get your income back up to where it was. Not just your debt or your finances back where they were.

Yeah, because if you can. Jason. That kind of money, you can go out this mess fast. Yeah, absolutely. And then, you know, just think you got you working, you know, 10.

Let's say 10, 15 years. Um, and if you, and if you invested three grand a month, just through a ton of retirement every single month, it'd be about $640,000. Do retirement.

Is what it comes out to be?

You can retire a millionaire. Yeah. And that's just that, at that, at 10%. So even if there were some great months going on. And if you went a little bit, you know, more.

And worked a little more, me all of it. Like the numbers really can work in your favor. Yeah.

“But you part of this as you have to emotionally recover from thinking you're going to”

die. And from recovering. You recover mentally. Me after recover mentally and emotionally. And then start to see, you know, the possibilities again.

And what income. And the frustration of cancer. Like what it's taken from your health. And then your money, you know, your retirement. Everything.

It's, it's so deep. So deep. So deep. But the fact that you are here, Jason. Hey, man.

And you and your wife on the same page. Hey, man. You really can.

It could great second chapter of your life.

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Visit yreFi.com/ramsey might not be in all stage. Today's question comes from Evan and South Dakota. I hear you talk frequently to callers who have high car payments and are living beyond their means. I travel a lot for work and I need dependable transportation. Any time I bought a beater car, I ended up paying for it in repair bills.

“Where do you recommend finding a $4,000,000 vehicle that is reliable?”

It's a good question. Well, I mean, honestly finding an individual who's selling is going to be your best bet. And we usually find this is funny, but it's true. Usually an elderly person, a lot of people's grandparents who have a car that's literally been sitting in the driveway. It's probably older, but the mileage is so low because they're not using it at all.

A lot of life left in it. Yes, yes. And if you go, I mean, honestly, if you look on Craigslist, Facebook Marketplace, you can do some research and find. And again, you're going to be in this car for maybe nine months and then you move again. Like it's not like you're going to be in a long term.

There may be moving up slowly, slowly, out of it, out of that price range, but the, I mean, we see it a lot that people have it. So you, and you want to make sure you have an inspection, right? You go to a mechanic, make sure they look over it and there's anything obviously wrong with it.

Then, then don't do it, but part of that is research the type of car.

“And old Chevy, Chevy is not good because they weren't good when they were new.”

So, I mean, an old Dodge Neon is not good because it wasn't good when it was new. So, get a car that has some life to it. You know, the Toyota Camry, the Honda Accord, those kinds of things. They're very seldom sexy cars, but they're cars that just are work horses. And they go, and they go, and they go, and they go, and they go, and they go, and they go, and they go, and they go.

Okay, and that is, it's not a forever thing. It's you drive like no one else, so later you can drive like no one else. Now, let's go ahead and parlay this into, you mention one thing here that I want to add to this. I travel a lot for work. Now, I don't know what that means in your case, Evan.

But I will tell you this, there's a mistake that a lot of people make that are literally on the road every day. Now, if you travel a lot for work, it means you drive out of town and you're there all week and you drive back, that's different. But if you're putting 50,000 miles a year on a car, you're destroying whatever you drive.

Because you put 50,000 miles on a car, you've destroyed its value.

And so the value is going to not only go down normally, it's going to go off a cliff. You're going to lose value like crazy. And so you, when you're a road warrior, because you're in sales or you're in whatever, whatever you're driving is an expense. That's all it is, it's not a luxury. I drive 12 minutes to work.

That's a luxury. I can drive whatever I want, I'm not destroying it. Okay. But if you're driving 50,000 miles a year, you're turning a, and you drive a 50,000-dollar car. You're turning it into a 5,000-dollar car.

And I do wonder for your work, because a lot of, I mean, one of my good friends, I mean, she goes, We're in Nashville, but she goes to Chetanooga, Birmingham, Huntsville. I mean, she's doing dates, right? Doing that, the 4,500-dollar car is probably not what you want.

No, but, but work furnishes for a lot of people.

Some people are, gives them money. Money, yes, I'm curious what that reimbursement looks like. Well, if you've got a reimbursement. But reimbursement does not require you being dead. Yeah.

You just requires, in some cases, that you have a car of a certain age. So here's the thing. If you're putting that kind of miles on a car, I wouldn't drive more than $20,000 car. But I wouldn't drive a 5,000-dollar car either, because it's not going to be reliable.

“So you need to drive the least vehicle that will end quotes, get the job done.”

And let me tell you what that means. It means it's reasonably comfortable because you're in it all the time. So again, we're not putting you in a smart car for 12 hours a day. You're being a chiropractor. Okay, so it has to be reasonably comfortable and it has to be reliable.

So again, I'm back in a Honda Accord. I'm back in a Toyota Camry. I'm back for, you know, I'm back in a, you know, a Chevy pickup, a Ford pickup. You know, any of that depend on your gas mileage and what you're doing and what you're holding, what you're selling, all that kind of stuff.

So, but you want something that's dependable and comfortable, but you don't drive an expensive car or truck when you're doing this. 'Cause you're destroying the freaking thing. Value was. So quit going and, you know, and, you know, that goes from my friends that are real estate agents.

Quit buying $200,000 cars to show houses in. We all know you can't drive. If you drive over the edge of a curb running to a mailbox to hit something,

“you're, you're, 'cause you're always paying attention to something else.”

Oh, look, there's house for sale and whipping around and, the real estate agents, I'm one of them, we're ADD and you're just all over the place. So, quit buying expensive cars by a reasonably nice car to show houses in. But no one buys a car because you had a, buys a house because you had a $200,000 car, versus you had a $50,000 car.

Nobody does. That's just bull crap. That's in your head and you're just to find buy something you can't afford. Stop it. So, all of that to say, Rachel's right.

When you're doing the $45,000, there's plenty of good ones, but they're usually not cool. They're not cool. No one's going to stop with the spot stop light and go woohoo. One, it might be seven months, and you're going to have to trade out again,

which is a pain, but if it's the thing that gets you out of debt the fastest, that's the inconvenience, that's worth it. We did it. We drove a borrowed car that had 400,000 miles on it, and I drove it for 100.

400,000 miles. No, it did. It did. It was an old Cadillac. It had a predominant color was Bondo.

The vinyl roof was torn loose. We drove it for three months. I told people we drove it for ten years, one, three months buried. It felt like ten years. But I didn't have a car payment, and I saved up a thousand dollars,

because I wanted to get rid of this. I took it back to my friend and gave it back to him. He loaned it to me, because he knew how broke I was. And then I got a thousand dollar car, and that thousand dollar car,

I left it in a parking lot, and some people beat it up,

and I actually, for some stupid reason, put insurance on it, and I got $2,000 from the insurance company. So I put $1200 with it, and bought a $3,200 car, and then we sold that about a year later for $3,200. It didn't go down.

It was already, and then we bought a $10,000 car, and so on.

“And so that's how we did it, and you can do it too.”

But your friends are not impressed. The brown car? That's the $3,200. You remember it? The front wheel drive old mobile.

It's pretty ugly. Well, in the vinyl roof, the roof was detached. So every time we stop, it would just bubble up. Yeah, I do remember that. Yeah.

But I'm poking. I'm not spinning money to impress you at a stop light. I don't even know you. I'm just trying to feed my kids. You know, I'm just trying to eat.

I'm just trying to get out of this mess and never come back.

I drove like no one else, so now what I drive is anything I want. And I don't buy cars for what other people think. I buy cars now because I like them.

“And that's kind of a problem because I like a lot of them.”

But it's, you know, you can get there. If you live like no one else later, you can live and give like no one else. So road warriors quit wasting your money. And those of you that are driving hoopedies, they're not all bad. And Rachel's point is really valid.

You're probably not doing this for even a year. That car only needs to last you a year. Yeah, some people think the car buying and I can get in this mindset where it's a permanent. It's, yeah, it feels like I'm going to have to drive this to the wheels. Like I have to drive this forever and never.

And it's like no, no, no, it's okay.

I can just get another one.

You're fine. It's not a house. It's not a house. Yes. You could be about different one every week.

I mean, it's other than the tax problem and the registration. It's, you know, but it's not a long term thing. No, no. Yeah, so you don't feel so permanent. And so here's the thing.

If you don't have a car payment for 12 months and your car payment was a thing. And your car payment was a thousand dollars. That's $12,000. So then you can sell that $5,000 car. By the way, it'd be about like my 3,200. When it doesn't go down in value. So you can sell it for 5,000 and put your $12,000 with it and get a $17,000 car.

And do that for 12 more months. And then you could get a $29,000 car. If you just save your own car payment. Stop it. With the car payments.

♪ ♪ ♪ ♪ ♪

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That's Churchill Mortgage dot com slash Ramsey offer or click the link in the description. ♪ Allen is in Indianapolis. Hey Allen. How are you? I'm all right. How are you? Better than I deserve. What's up?

So I'm looking for help in my fiance on board with sticking to a budget. Okay. How long have you been engaged? We've been engaged for about a year. Okay. And when will you be getting married? Well, we haven't said a solid day on it yet. We've got a one year old so between taking care of him.

And I'd like to be a little bit better out of that before we get married. Wow. You're getting a baby. Yeah.

Might as well get married.

Yeah. Okay. Anyway. All right. Now the. How old are you guys Allen? I'm 26 and she's 25.

Okay. Great. And what's the conversations been like about budgeting together? You're not married. You certainly technically should still be on separate budgets with separate incomes and everything until you're legally married just to protect. She needs that protection for her and you need that protection for you. Yeah. Well, she won't be entirely honest about how much that she has.

And it was excess of 15,000. Why would she be honest? You know. I don't think she wants to tell me how much. And I know she hasn't been paying a lot of it.

She moved away from her phone home town to move down with me. And I've been a primary source income for both of us.

“That's what happened. She thinks she has 15,000 dollars in debt or savings debt debt.”

Okay. And why would she not want to be honest with you? Um, I think she's embarrassed about it. Because of the way you've presented it. I mean, that could be some of it. I think she just. She isn't like where she's at.

And she she doesn't want to open up to me about it entirely. Because it's a vulnerable thing for her and that's something that she kind of shows. It's being vulnerable, especially about stuff like that. Okay. So I think that's probably more of the root issues that you guys are living together. You have a baby together. You're engaged to be married and from a relational IQ stance.

You guys don't have the equity relational equity to hold each other's situations. And that's does that feel like a red flag to you that you guys can't be fully honest about what's going on. Yeah, definitely does. Yeah. So I would work on having that conversation in the way you presented Allen is really, really important.

Because if she feels like crap when it comes to money, if she feels dumb,

“if she regrets all of this and you're like, well, you need to be doing this and this and this and you got it.”

You know, so those people can come hard on someone that's already down. And so I would say to love her really well in that and to have a lot of humility, a lot of grace. And your desire is to know her and to know her situation and not to shame her. But for you guys to start working together to have a plan for your future because your future I'm hoping is together, right? And to be a married couple and so to make some forward some some progress forward.

What do you make steps? So last year I made about 96,000. Okay. What do you do? I'm a long person officer.

Okay. Good. Okay. Well, if the way I answer questions and the way we always have on the Ramsey show is what I do if I woke up in your shoes.

Knowing what I know about the data that's out there and what it takes to win in a marriage and what the data that's on that and the data that's what it takes to win to build wealth. And by the way, they're pretty similar, which is interesting. So the single people that are 30 that are living together have a net worth is somewhere around 14 times smaller than the married people that are 30 that are living together. And so the data tells us that marriage tends towards a much better financial situation versus being in a, being in a shacked up.

Okay. That's what the data tells us. So now that I know that I'm getting married this weekend. I already. Not for the money. Not for the money.

But what I have a child. But you haven't already. And I'm taking this lady. Yes. I'm already taking care of her.

You're basically married outland.

I mean, good. Well, be. Yeah. I mean. And so go ahead and get that done.

And there's no like, I have to get out of debt first. I didn't have to get out of the way to have a baby. So no, I mean, that's a lot bigger deal than get out of debt.

“So let's, let's, you know, that's what I would do.”

I get married this weekend. And then to Rachel's point, I would begin to say, okay. We are going to work on all of our prosperity and all of our bright future together. And we together are going to make decisions that cause that to happen. And so, and I'm going to help and you're going to help and we're both going to have a vote.

And we need to sit down and say, okay, what's blocking that? And so whatever debt you got on, we're going to clean it up right quick.

And then we're going to start saving money for retirement.

I mean, save money for an emergency fund. Then we're going to save money for a down payment. They're going to save money for retirement. They're going to save money for junior college fund. And then we're going to pay off the house.

And we're going to become millionaires in the next 12 years. And we are going to sit down together. And we're going to look at that. And we're both going to tell each other everything about everything. And I'm going to help and you're going to help.

“And that's what Rachel's talking about building relational equity.”

And there's no shaming in that. It's like, you did what? You know, unless unless unless you're much after we agreed to doing something, you go back to something. Yeah, but the power dynamic in the situation.

I mean, is she home with the baby, Alan? Is she that she's not bringing in? She's not bringing home and then come, right? She is. She works part of time.

Because she, she feels like she needs time out of the house. And I'm not going to be going to argue with that. Okay, yeah. Yeah, no, it's great. It's great.

Um, yeah. So that's what I would do. And you say, we're going to, I want us to be aligned on saving money. I want us to be aligned on getting out of debt. I want us to be aligned on what we're spending.

And both of us talking about it. And both of us having a vote in this as a husband and wife team. And let's go see the pastor of the justice for the pieces we can. And let's get, and then let's go build our life together. Yes.

And because you're, you're trying to run around with one foot on the boat and one on the dock and a boat keeps rocking and you're going to end up in the lake. Mm-hmm. You know, and so you just need to get all in to the boat or back off on the dock, one of the two.

And, and remember, Alan, money is, it's not the end goal, right, of marriage. She's so working together with that. It's the, exactly. It is, it's what it produces. What the money represents when you guys are on the same page.

You both have a voice, you're both being heard. Both of your opinions matter. Like all of that is a practice to every other part when you're talking about parenting. And you're talking about in law, right, like all, you're all the same person. And so when you can kind of work on one area of your life like that,

to get on the same page together, it's huge. And to know her and to serve her well.

“I mean, honestly, yeah, Alan, I mean, I would be like,”

you're a police officer. You know what to do? Step up, you know? Step up and take care of her. Yeah, you see the families every day, the things aren't going well with.

Yeah. And so, um, yeah, you can just, you know, all you guys look at that. No, that's my end time mentor. I'm going to go the other direction of those things. And, um, and none of the things you're Rachel and I've been talking about.

And the life, yeah, the life you can create, Alan, as a husband, as a father.

Like all of that is incredible.

Like men that step up. To serve and protect. And take care of. Yes, it is literally part of your DNA in your job. And when men do that.

And, and their wife again, I'm so big on this, but they have an equal say. They have the ability to have an opinion and they're hurt. Like all of that together is beautiful. It is. I mean, I almost every man I know.

And we also want to step up. It works. And it works. Very practical. Yes.

No, absolutely works. What ends up happening is you have a high quality marriage. And she feels secure. She feels secure. She feels secure.

Yeah. You feel like you are doing your part. Yep. And stepping up. Like all of that is in this conversation.

“And so I think there's a quality of marriage element there that's so big that you get to step into Alan.”

Yeah. And not to shame her, but you get to walk beside and help. And it's a really, it's a beautiful thing. And thank God for that. For two parents like that with this baby, you know?

Good for this kid. Yeah. Absolutely. Get married this weekend. [ Music ]

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Ensured by the NCUA. Devon is with us in Denver. Hi Devon, how are you? Good, how are you today? Better than I deserve. What's up? I was in my Nordi owner in electrical business and I had to sell it.

Well, I sold out and I'm going to get my payout. And I'm trying to decide if I invested in a mutual fund or payoff my mortgage, which is at two and seven-eighths per cent. Okay. On a 30-year mortgage with 25 years left.

Which is the balance on your mortgage? 422,000? Wow, nice payout. What's your payout? 335.

“Oh, so you don't have enough to pay off the mortgage?”

No. You don't have the other 100.

I do have about 90,000 in savings right now. But I was going to use that to start my business back up. And keep that aside for our three to six months emergency fund. Okay. Well, let's go back to the original premise and let's figure out

what to do with your particular situation. The original premise is I don't want to pay off my two and seven-eighths and rather invest it instead. I would not go with that theory. That theory doesn't hold up when we study the actual data of people who become millionaires.

When we studied 10,000 millionaires, the number of them that said I borrowed on my home so that I could invest. And that made me a millionaire was precisely zero. We didn't find a single millionaire that did that. And that's the essence of what you're doing.

When you don't pay off your house,

it's the same as borrowing on it.

“And so no, I'm always going to lead you to getting out of debt completely as fast as we can.”

But you've got some competing goals and you don't have enough money to do this whole thing here. So there's something to think about. So how long have you been away from that business? I'm still employed. I have to work here till the end of the year. Oh, okay. Alright, and what do you make?

Right now I make one 50. Good. 50,000. And are you going to go in? Assume you've got a non-competence.

Are you going into a different business? The non-competence is not all of the existing customers. It's some of them. But I had my own business for seven years and I partnered with the university. But you can go in the same industry again.

But just not take the customer. Yeah, okay. Wow, that's unusual. Good. And so you're going to go up and up a new shop. Yeah, yep.

Okay. I had my own shop. My shop is still alive. I never turned it off. It just for the past three and a half years.

It hasn't done any real business.

“Okay, so why does it take so much money to go back on?”

I guess I was saving out of leftover money. I know, but I'm saying you said you need a 90 grand tour to back on. Why doesn't it take 90 grand to turn it back on? It doesn't. Okay, good.

That was another is six months of emergency time. What is? Six months. 60,000? 50,000.

50,000. So you have a $4,000 month burn rate. On your house. Okay. All right.

Okay, so $50,000. We got $40,000 there to start the business and/or put towards the house. And we're getting $300,000 towards $400,000 on the mortgage. So what I would do in your shoes is I would just take the buyout and the $40,000 and separate the nut. Set the 50 aside of your emergency fund.

We're not touching that for anything. Okay, do you have any debt other than the house? My wife's car has nine thousand and changed. Okay, pay that. And we're on track to pay that off today.

Okay. Just try to check and pay it off. Okay. So now we got 30,000 to start the business and 50,000 in emergency fund. But you don't have any payments but a house payment.

Am I right? Okay. Now, then what I'm going to do is I'm going to take your 30,000 and park it with your buyout money. And just a high yield savings account for six months and let it just sit there.

When you get your business started and you're back to making a hundred thousand a year again,

which will be pretty quick, I suspect.

“Because you're going to start working on it between now and the year to kind of get it restarted.”

It's not going to be a cold start in January. Then when you get back to making a hundred K again, then I'm going to take that money and throw it at the mortgage. And be mostly done with the mortgage. And then your mortgage will be paid off in about three years or two years.

If you do that. Okay. And when you don't have a house payment, it changes the way you do business. Your business will prosper. When you don't have a house payment, it changes everything.

And people do not grasp it until they don't have a house payment. And then you take the huge cash flow that you've got without a house payment. And you go become a multimillionaire. And really what that, what this buy out has done is it sets you free from all this debt. And took me a minute to kind of wander around through our system to get you to where I would go.

That's what I would do. I would not keep the mortgage like it's a pet just because it only eats a little. Mm-hmm. Just requires a little bit. Yeah, still there.

Two and seven eights. Yeah. A little ball of dog food. It's exciting, Dev, and that would make some big headway. You did great.

That's great deal. It's great deal. Well done. Very good. Stacy's in Boise, Idaho.

Hi, Stacy, how are you? Hey, thanks for taking my call. Sure, what's up? So, we have maybe a unusual problem. My husband, I have been on the same page for 27 of our 30 plus years of savings,

grumpy and savings, grumpy and that's something money. And we are now at a, I think, a very good, safe place. And I am comfortable starting to spend some of that money. Good. And what's the same place, what you're not worth?

Almost 12 months.

“Well, yes, you should be able to enjoy some of your money now, for sure.”

That's how I feel. And my husband is, you would think we're, we're one month away from losing our house. Yeah. When I talk to him about things. And it's, it's, it's very hard for someone who has held so tightly to savings,

particularly his nature as he's a savor, to loosen up and enjoy life. But that's why God sent him you. It's, it's just so, I feel like, you know, even on little things I was telling your screen, or just, we, we both look from home. We have one car on one another.

You need a car. I mean, that's weird, isn't it? Yes, that's weird. 11 million dollars. You need to go buy a car.

Yeah. It's like the, the, the parable of bigger barns. That's a classic to me. You're just building and building and building and building and building. For what?

For what? For what? Just for another barn? Yes. No, that's not why you do it.

How do I break through? I, I don't know. It's, it's, you're not going to be able to change him. It's going to be, it's going to be his work. That's, that's deeply ingrained.

If you got 12 million dollars sitting there,

and you don't want to buy a car for your wife. He's, he's got some issues. Yeah. God love him. But right.

Yeah. How do he grow up with money? Well, what's his story? Poor. Um, yeah, he grew up her.

But I'll tell you, I grew up more poor. I mean, I was the driving force here in our household of like, you know, coupon. This is not a, this is not a financial thing. It's not even a relational thing.

It's a spiritual thing. It is for him. Godliness with contentment is great gain. And if you gain only from your money, the fear of losing it, you didn't gain anything.

And that's the parable of the bigger barns that Rachel's talking about in the Bible. And so enjoy some of it. Be generous with some of it. And continue to save with some of it.

“And you should always be doing all three.”

I will tell you this. Sometimes the way to get someone to loosen up on spending is first get them to loosen up on generosity. Helping others with some of this money. We need to allocate a hundred thousand dollars a year

to give away. That's going to blow your mind.

Because you've never given that kind of money away.

All you've done is safe. Now to force yourself, say, see, to give away eight thousand dollars a month. You have to. And it can be in tips.

It can be to an art like fit to do that. And it is. There's a. You'll hear of something going on. And you'll write that check to help.

I mean, there is some amazing things that happen in the world. And when you start to participate in that. Your money is making a million dollars a year. It opens that hands. And that freedom is what that does.

It gives you freedom from money. And then it allows you to give you an excuse to enjoy some of it.

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Meet your match on zip recruiter. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio.

“Stephanie is with us in New Haven, Connecticut.”

Hi, Stephanie, how are you? Good, you. Better than I deserve. What's up? So my question is, I have an issue.

I'm currently six months pregnant. Yeah. My husband and I, yes, with my second child. My husband and I are trying to get ready for this maternity leave,

but we don't really have a solution.

I am the breadwinner. I am an entrepreneur. So I won't be having really any income during my three months maternity leave. My husband doesn't know what to do. I don't really know what to do.

We don't have any savings. We had a blow through. Most of our savings recently to get a heating and cooling system in our home. Which was absolutely required because I just don't want to use space heaters anymore. And we're really trying to figure out what we're going to do.

My husband thinks that he can't handle this. He doesn't want to get a part-time job. He thinks that we should just sell the house. And even though we have a 2.65% interest rate on our mortgage, he thinks we should just sell it.

And just live off his income and go back to a regular apartment. What do you make? So I bring home about roughly $6,000 a month. Okay. We're doing what?

I'm a consultant. Oh, to what kind of consultant? I hope business is with rent writing and strategic plans. Say again, we hope business is strategic plans. Strategic plans.

What does he do, Stephanie? There'll process and technician. And how much does he bring in? He brings home, and this is in the income. So he brings home about 3,500 a month.

Okay. And how much do you guys need? How much is your house plan? So we have two, we have one mortgage, which is $800, that's not escrowed.

And then we have a second mortgage is $880.

“And so that's what you guys are short to your short 1600 bucks a month,”

basically is what you're needing him to bring in for three months. No, we have other expenses that we have not alone. We have two to one. Okay. So how much extra does he need to bring in a month?

For you guys to keep your situation? I would say, comfortably, it would be great. If he could bring in an extra $3,000, because groceries, household expenses, and then upcoming with daycare. Okay.

And... All right. How much is the car payment? 1,250. Okay.

All right. Yes. He should pick up a part-time job and you should keep your home. And you should yourself employed. When we're self-employed, we don't get the same benefits as employees.

Great. And so there's no reason for you to be off from work for 90 days. Oh, man. You're self-employed. Nope.

You do strategic planning. No. I disagree with that. You push a baby out and try to be somewhat normal 60 days later. So nope.

This is what y'all, this is what y'all signed up for. Nope. Has been get to work. Nope. You didn't want to get a part-time job.

That's the problem. To me. That's the problem. Go get a job, dude. Go get a job.

Don't make your wife after you've been through what you've been through. You should've seen me 60 days after a bit.

No.

“It's a difference between what you have to to keep your house or not.”

You know. I guess so. It just sucks. You just decide.

You know, you both signed up for this.

You're self-employed and you plan to have a child and you have no money. And instead of keeping the space heaters, you decided you had to have heat in there. Now you're going to sell the heat in there with the house. I guess. Hmm.

So, you know, you've made some choices here that it painted yourself in the corner and you're going to get paint on your face. That's fair. I hear that. I hear that.

You're going to get paint on your feet. So, you're going to have to say, we have to choose our paint. Pain is coming. Okay. And the paint I would choose if I was in your all shoes is heat.

I'm with Rachel, he needs to go get six jobs and take care of his family and do all that. If he can. Yeah. And you can do something a little bit.

And if you can do a little bit of work from home, that you're, you know, gradually

end re-entering faster than the 90 day swing because you're not an employee. You took all of running a business and so, you know, you don't have choice. You get to go back to work. That's it. If you want to keep the house.

“Really both of you should be willing to do some of this or make the decision to sell”

the house. But I, I don't agree with him that he just gets to bail and do nothing. I'm with Rachel on that. That's, that's, you know, no. That's crazy.

He's just up up and, but I also think both of you made this mess. And so, the thing I want to take away from this more than this particular situation is fixing how we got here, which is, you know, no savings, lots of debt, so a car, I saw the car for it, so the house. 100% of the time.

But it doesn't fix the problem or if you told me $1200 that car to be gone about about a minute and a half ago. Yeah. But, but it's not a $350, so it doesn't fix the problem, mathematically, to get rid of it. But yeah, I think there's going to be pain.

Now, the two of you look at it because of where we are. Now we have to decide what the number of our thing is. I think it is. Yeah.

And, gosh, it would be, so the house, the house, conversations, always, we're getting more

and more of these calls. And the housing market people are frustrated. There's sometimes frustrated with our advice, because we're very conservative on the numbers and what you can buy. But this is why, like if your house payment and $600 bucks and everything, yeah, it gets

true. It's not that bad. Yeah. It's not. It's just, it's just that no money.

But when you buy a home and you're a home owner, you're stuck in that. You're stuck. And to get rid of that, a budget, it's expensive to have to move out and then go back and re-enter into the housing market. Yeah.

What I would say to you and your husband, then, is we love you and we want you to win 10 years from today. You'll be glad if he takes extra jobs and you take on work as you are able reasonably after the baby. Yeah.

Okay. That's three kids. I don't know. But, you know, again, when you're self-employed and there's a lot of, I don't know, I hear things.

I've come to work sick for years and, you know, I don't have a choice. If I blow out my knee, I'm, you know, I'm putting it in the cash to come work. I don't have a choice.

“Do you understand that's very different than growing a human being?”

I'm not. I'm not. I'm not the baby. I had it. I was sneezing a lot, but I came to work such a hero, such a hero.

Oh, brother. Oh. Anyway. Now, I'm telling you, the deal is, if you have a major medical event, it's not unusual for people that are self-employed, it'll be back at work a lot faster than an employee would

be. Okay, that's a fair statement. That's a fair statement. That's all I'm saying. I know.

So listen. It's not sneezing. But it was like, oh, that was cute. That was good. I had an Eurey Quinton.

I can't walk. No, no, no, no, no, no. I'm an owner. I came. Well, I have, you know, the other thing is, okay, let's just, let's say, if we're going

to continue the fun, you know, who comes to work? And Tennessee, when it's snowing, the people that own the business, not the employees. Not many of them. And that owns-- Oh, really, the hearty of hearty employees should work.

That trucks come in. Well, that's it. Listen, the Tesla doesn't have four-wheel drive. I ain't going to get on the piece of ice. I'm going to get on anything of that test.

You won't even get in the Tesla. Hey, George Campbell here, we often talk about how being normal sucks when it comes

But guess what?

“Normal isn't so great when it comes to your job either.”

Normal is staying in a job you hate, dreading Mondays and working for people you don't

even like. Sound familiar? The good news is, you can break free from normal because Ramsey Solutions is hiring. And we refuse to settle for the ordinary. In fact, we are anything but normal and we are proud of it.

And right now, we're hiring for technology, sales, marketing, writing, copy editing, and creative roles. So head over to RamseySolutions.com/careers and apply today. Rebecca is in Tampa, hi, Rebecca, how are you? I am great, how about yourself?

Better than I deserve. What's up? Absolutely. So thank you for what you do. I am a single Christian mother to teenage boys, love them with all my heart.

I have been blessed financially by God. I've been going through my healing journey as a Christian and money is this step of the sanctification process I'm currently going through. My business is in the engineering field.

There is a tragedy in Florida which allowed my business to earn almost a million dollars,

but then the state mandate stopped and now my income is back to around 200 to 250. In my excitement, I paid off everything, paid off a car, student loans, all my credit cards, tied about 50,000 to my church. Basically, just spent it like it was going out of style and... You can spend it, you pay off that.

I did and then I incurred more debt than I could imagine. I said, you know what, I need a stable home for my kids, so I went from renting to purchasing a home when I bought the house. I bought an older house because they said, we'll just tie in a construction mortgage or a construction loan with that, which they did not do.

So I applied for one, got denied, applied for another, got approved, and I later got approved for the other one. So bought a house for $5.50, put a percentage down, got two construction loans, and then I bought a truck because my son does motor cross, it's just been a lot. I got to the point where I was physically ill with how much I was spending.

And I'm bringing in about 15 to 20,000 a month, but my bills are 11,000 without including gas, food and everything else. So I'm making myself sick with how God has blessed me that I've been brought to tears, humbled. So when it comes to that, humbling power, I'm saying it can be.

I bless you with the income, I didn't bless you with the house or the truck. Absolutely. Because the house and the truck don't have the blessings of the Lord have no sorrow I headed to them. And so the money didn't bring the sorrow, the income is wonderful, but the purchases

didn't bring sorrow because of the debt.

“And so or the lost money, whatever, so is the truck paid for?”

I had an escalate that I paid off, it was worth 22, so of course I went and bought a $62,000 pickup truck with my son doing motor cross at the grocery store. I don't care about your son's motor cross, and I'm already tired of it. Yeah. Okay, $62,000 to ride a bicycle, give me a break.

All right, so now we're going to sell the truck. How do you owe on the truck? I owe about 31,000. Right, get rid of it. You hated it.

And he wasn't doing motor cross with that pickup before if he was to go back to doing it the way he was doing it before you had the pickup. It didn't bring you joy. It didn't bring you joy. Yeah.

“Okay, so what about the house we're going to sell it?”

No, I just bought it, I put 70 grand into renovation, so I have the house. I don't know. How much is your payment a month? Yeah, I love the house, so my mortgage is $4,000, $68, but when I was bringing in 20 grand, I'm like, well, that's peanuts, but the construction loans is what got me, so I have

one for $1600 and another one for $2400. On top of the mortgage, correct. Yeah. So another, so it's $9,000 gone to the house. Is the house the construction completed?

Yes.

Okay, if you refinance the house and got a new mortgage that took out your first mortgage

in the two construction loans, could you afford the payment? We've had a doubt, because I bring in about 20, it's just a--

Okay. Refinance the house and sell the truck. Now we've got a mortgage we can afford when we don't have a truck payment, because the other thing about that truck is, or tell me, look at it, your field dumb. I bought stuff when I did something dumb, and the thing just kept reminding me I did

something dumb, and you're not dumb, you make a lot of money, you're smart. Mm-hmm. But you do a couple dumb things, that's okay, we've all done dumb things. I got a PhD into UMP.

It's been a lot, I've made 150 to 200 a year, and I liked to have always been turned

out in my home, even when my home was 1,500 a month out, I told my kids are amazing. I said, "Guys, we need to change," because they're dead as a multi-millionaire. He's retired at 48, but he doesn't do anything for the kid or with the kid. Oh, Mary? I don't know.

She said she's single. I'm sorry. I've heard a word. Okay, I got you. Well, that's him.

I love doing things with them, because I feel like-- Yeah, but you can't do that, you can't do that and put it in the food leash column. Yeah. Yeah. Because the things, you know, you outline for us, the things that you did that you were

“ashamed of that we're bothering you, that you were regretting, right?”

And so let's just undo those things, or restructure them to where they work in your world, and your piece comes back, and then we clean up the debt. So would you be dead free if the truck was gone and you refinanced the house, except for the house? Yeah, I've no credit card, no student loan.

I have nothing else.

I've cleaned all that up in that first blush, yeah.

We're back again, and you need to be-- and do a monthly budget. You need some control. It feels a little bit, just from-- Yeah. --yes.

--just talking to you. --and I do reserve studies for a high write. That's literally what I do. I do budget for other people, and it makes me bar, that I keep-- No, it's a BMX and motorcross.

It's so hard, because we have state-- I've spent thousands every month, traveling, and hotels for racing. So I go, how do I do a budget? And I don't know what my expenses are. The bike breaks, he needs clips, shoes, that's a thousand bucks.

OK. I've made that an excuse, because I could still budget without that. I could leave.

“Well, you need to figure out, on average, here's how much I spend on my son's motorcross, right?”

And can I afford it? And it is-- --and it is described in a sound like you're good afforded. Well, I believe I could if I just stopped getting Chipotle and Doradaash every week. Wow, OK.

Well, maybe. I don't think that's the thing. I kind of think this motorcross thing's out of control. It sounds like a way to hear the word "no." Yeah, it's probably a word he needs to be introduced to.

And don't feel guilty about that, Rebecca. Sometimes I don't make a living in 48 years old doing motorcross. Yeah, but as we hear this with a lot of divorce situations, that there is this overcompensating-- Disney Mom.

of it. And I get why. You want your kids to have great experiences and a great all of it. But you can't go broke doing it. Yeah.

And there's a limit. You're not in Congress. So I would figure out how much on average are you spending a month on motorcross? Make that a line, I don't know.

I don't set a budget up and say, we're not spending more than that. Yeah, exactly. But then you got to, you know what you mean? Like, that's the great thing about a budget is you get to put your money where you value.

So Rebecca, if you really do value this for your son and out to eat, it has not much in it in order to make that happen, you get to decide that, Rebecca. You're an adult. That's what the budget is.

You get to make that decision on where you want your money. You need to go. But it has to be purposeful or you're going to feel at a control constantly.

And always asking, can I do this?

Can I do that? The budget is permission to spend. It's where your values are. And so, yeah, I think that's going to be a big change for you in a really positive direction when you sell this job.

“A hundred percent sure you need to spend less on motorcross.”

And I'm a hundred percent sure that you need to put a limit on it. Because right now you spend whatever comes up and never ask a question. And then look back later and go, "Oh, those clippons were 1,000 bucks." You know, you know, couldn't afford it this month. And depending on the age of the kid, maybe he gets a job and pays for half of it too.

And maybe he needs to win a race and get some prize money. I don't know. I don't know how that world works. I don't know. Hey, folks, changing gears here for a second.

George and I will be doing the investing essentials virtual event next Tuesday and Wednesday. Anyone can become a millionaire. It's not that complicated. It's not a whole lot of millions of people how to do it. This is the only place.

We've only done this a couple times. I think the third time we've done one of these is the only place I unpacked my playbook for investing in wealth planning and we'll cover the basics of investing for mutual funds all away into real estate. And even some of the nerdy stuff as well.

New content, I'll reducing taxes on wealth on wheels and so forth. Tuesday, Wednesday, next week, join us from the comfort of your own home. Look at start at 199, you can get them at ramsysolutions.com/events.

Dave Ramsey here, for more than 30 years, I've been talking to folks on the air and I can tell you that most people are broke. Not because they don't make enough money, but because they don't have a plan.

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It's time to start your every dollar budget for free today. Go download it in the App Store or Google Play. In the lobby of Ramsey Solutions is the debt free stage on the debt free stage, Colton and Alley Join us, which means they're debt free. Congratulations, you too.

How are you? Good. Thank you, are you doing good? Excellent. Where do you guys live?

Over from Hillman, Michigan. Which is near what? Alpina, Michigan. Which is near what? Northern Northeast, Michigan.

Ah, thank you. That's a glove. Thank you. I had to get something on it. Great.

Well, thank you for coming all the way to Tennessee.

“Where did you guys, how much debt have you paid off?”

Payed off 140,000. Wow, how long did that take? 22 months. Good for you. And you're range of income during that two years?

I'm around 150,000, do 170,000. Wow. What do you guys do for a living? I'm an electrician. And I work in mergers and acquisitions.

Ah, very good. And you're killing it. Way to go, y'all. What kind of debt was your 140,000? It was our mortgage.

You paid off your house. How? You guys were so weird. How old were you, too? I'm 24.

I'm 23. [LAUGHTER] But you can't buy a house in America today. We have an affordability crisis. But you two not only bought one at 24 and 22.

23. 23. And you paid off it. What's the house worth? About 250, 250,000.

That's good. Oh, it's a good look in house too. I love your planters. Thank you. Love the hanging planters.

See, that's a great starter house. Well done, y'all. So how long y'all been married? About three years. OK, over three years.

So a little bit into the marriage, like a year into the marriage, you went, we buy the house at that point. Yeah. And then you went, we're tearing into this thing. We'll knock it out.

Yeah, we were on the same page, basically you

rate when we got married.

“OK, so how did all the ramsy stuff infect you, guys?”

I actually basically grew up with it. And then kind of infected her when she started to hang out and get married. There's no vaccines. Did you guys have any student loan debt or anything

going into the marriage? Like, you guys went and debt free. We were actually high school sweethearts. So we actually started dating when we were 14. And he showed me the day ramsy podcast.

We actually worked at a berry farm together and so in the summers. And so we had actually listened to the podcast while we're picking strawberries and raspberries. OK.

It's again through school. Did you guys do school? So yeah, so we paid our way through school. We had, we were both on the same page, no student loans. We paid with our wetting, we paid through our wetting.

So we didn't want to have any debt going into the marriage. You guys are like unicorns. You're amazing. So what's your degree in? Financial planning.

Of course. And I just had a certificate, electrical certificate. It was like, oh, yeah, yeah, yeah, yeah. Sorry, yes, yes, yes. Did your apprenticeship and all that?

And you're both killing it, way to go. And what'd you pay for the house? I was one, or I was two-- Two 25. Two 25.

OK. Wow. Amazing, you guys. And within three years, right? Two years, two years, you said.

Two years? Yeah, two years. OK, so what did life look like? Because you guys are newlyweds. What did you do lifestyle wise to put yet to pay the soft?

Was it just like we're going to cut everything and go intense? Or do you feel like you kind of did what you wanted still and through extra? Like how did you do it? Yeah, we didn't feel like we were still doing what we wanted to do. We still went on multiple vacations.

We actually did some house renovations. Mostly what we did is we lived on his income. And then anything I made, we just threw at the house.

So we just basically lived on one income and yeah,

through my income at the house. I did it. I just figured it out. So you know these guys on TikTok that say Dave Ramsey

Yeah, that's what they did. That's what they did. They picked berries. That's how they did. That's right.

I think they wanted to do that. That's it. That's it. That's what they did for a book of strawberries. [LAUGHTER]

Oh, my gosh, you guys. Amazing. Wow. What do your parents say? They got to be dancing.

Yeah, I think they're proud. Yeah, they're pretty sure you're not going to be in their basement. No, they didn't think we were too crazy. Yeah, well, they both taught you to work. They taught you to live like this.

Both of you, you know, that's hard work. Yeah, I mean, you're good, we're not doing it now. Yeah, you know, yeah, if you do that, you're pretty sure you want to get an education. You're pretty sure you want to get a trade. Yeah, yep.

So you don't end up there for lunch. How much is your mortgage every month? It was 1236, okay. That's amazing. I mean, it's crazy.

“And if you, not that you have to live in this house forever, right?”

You guys can have great eventually, if you want, but if you just invested your house payment

at your age of 26 all the way to 67, you'd have $16.5 million just investing your house

payment from here on out. Yep. It's insane, y'all. It's not crazy. Yeah.

Crazy. I have a financial calculator. So I do a lot of the financial numbers. I don't know where to say fancy studio phone, I was like, I'm gonna plug in this. Yeah, I'm definitely the nerd.

Oh my gosh, okay. Does it feel different? I mean, it wasn't. You guys didn't have it for too long, but how does it feel? I feel good.

It feels awesome. It feels free. Like, we don't have, like, literally you just feel like a deep breath, like we can breathe if anything happens. If I were to lose my job, if you were to lose his job, like, we're okay.

We're okay. Yeah. And on top of that, you're gonna be a really, really okay. Yeah. That's right.

It's generous. Yes. And generous. That's right. Absolutely.

So what do you tell the young people listenings? We have a lot of younger listeners now, a lot of Gen Z. What would you tell them if they're sitting there at 24/25 and they want to be you all, eventually one day? I would say I know a lot of people say to be on the same page before you get married, I mean,

that's definitely just be on the same page as each other. Yeah. And it's possible. A lot of times, it's like, we get so caught up in this victim mentality, almost where it's like, yeah, I mean, expenses, there's, and groceries are expensive, gas is expensive.

Like, we're feeling, we're feeling it too. Mm-hmm. But you don't have to let that be everything. Like, you can, like, yeah, whatever you want your reality to be, you can go and fight for it. 100% and there's, there's power too, like when you get married and you guys are on the same page,

working for the same goals and you're on the same track, there's, there's a power in that. It's a huge power. Yeah, like, 170,000 dollars worth of bones. Yeah. That was pretty stinkin' incredible. That's amazing.

Yeah. So, I mean, you guys, you, you were not in debt or not been married long enough to really have felt that just the grotesque weight. It was kind of a, a brush with it. Yeah. So instead of that feeling that relief from that, I'm guessing you just really feel accomplished.

Yeah. Like, you really, you really realize how, how sharp you are and how we really did this. And I'm just going to kind of walk around with my shoulders thrown back a little bit and be proud. Yeah.

“You, you should. I'm proud of you. I don't know your parents are proud of you.”

And you're, you're an example where we always hear is that you can't buy a house.

You can't buy a house. You can't buy a house. And, and not only did you buy a house, but at 23 freaking years old, you paid it off. So, I mean, shut up. Oh, my beer, right? And we actually bought the house.

Our goal is to pay it off and hopefully less than five years. And then just kept kind of snowballing and then we're like, oh, maybe three years. And then actually, it's kind of a day. Yeah. Yeah.

It's a big day to see the number go down. It's, it's gamified. Exactly. That's exactly what it is. That's hilarious.

You got a young, great. Powerful. So proud. Thank you. You're going to have so stinking much money.

It's kind of ridiculous. And you're going to be able to be generous and to change your family tree. And, um, and then send your grandkids to pick strawberries later. Yeah. That's good.

That'd be a good thing. Hopefully for fun and not for work. That's right. That's right. I don't think it's a good money.

“It's not the end of the world for three months.”

You can do a lot of stuff for three months. Yeah. Yeah. You can pull a lot of things together. It's, uh, man.

I'm so proud of you. Very cool. Your work ethic, your character, everything. Thank you. It's a stellar stellar.

Wow. Wow. Now, any time someone wants to tell me that Gen Z is a bunch of losers. I tell them I have seen otherwise. Golden Alley.

I have seen the Colton Alley's of the world. They come in here and they stand on this stage. They work on our team.

And they're absolutely incredible.

We love Gen Z. Not all of them. But we love. We love. We love.

We love the good ones. Yeah. They're good ones are there. That's amazing. All right.

Colton Alley from Michigan. 23 and 24 years old. 140,000 paid off. Mortgage and everything in 22 months, making 150 to 170.

Let's hear a debt-free screen.

Three, two, one. Winner free. Yeah. Yeah. [applause]

Yeah. [applause] Okay, moms and dads. I have a goal for you. Create another Colton Alley for us.

“Some of you that are raising these little characters turn them into Colton Alley.”

They can pick strawberries and pay off their house by the time they're 20. Well, and all you parents with little kids on the debt-free journey. Your kids are going to be that. That's what they're going to be. That's what they're going to be.

We grew up with this stuff. We grew up with it. [music] [music] [music]

All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling.

They're people you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near you at RamseySolutions.com/agent. That's RamseySolutions.com/agent. [music] Our scripture that I first Peter 315,

“but in your hearts, we're very Christ is Lord.”

Always be prepared to give an answer to everyone who asks you

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Wesley is with us in Montgomery, Alabama. Hi, Wesley, how are you? I'm doing great day of how are you? Better than I deserve, what's up? All right, so I'm 21 years old.

Many of my girlfriend have been dating for some time now. And I am thinking about getting engaged. She gets to Auburn. She has about five years left in school. She's going to shoot an pharmacy school.

And I close all my house next Friday. And so I'm just trying to side it to be wiser to wait and engage to her later on in school. Maybe like the year before she gets done with everything. Or go ahead and do it next year, because sexual might be her senior year.

But anyways, she has like four years post grad that she has to do. All right, are you going to be the house's near where she's going to do her post grad work? So it's about 45 minutes from it. Okay.

And so if you were married, what's she doing post grad work? She's going to do a 45 minute commute.

“Yeah, so that's what she has said that she's totally fine with that.”

And she said that even if it wasn't like if we weren't engaged, if we were married by then she would live with her parents and make that drive. And it's also 45 minutes. Okay. So and you've graduated?

Okay.

So I'm a, I never went to college.

I'm a real estate agent and a firefighter. So I work 24/48 and then I do real estate full time, I guess. What do you mean? What do you mean? So this year, I'll do six figures, I'm going to try it for six figures.

That's where I film combined. Is that like a hundred grand Wesley, or would you say six figures? Is that 150? 100 grand. Right out of 100.

Okay, perfect.

And what do you make?

How much of that was the firefighter?

So firefighter salary. I take home without any overtime or anything. Around $63,000. Okay. Who's paying for her college?

Who's paying for her postgraduate work? So her grandparents would pay for that. Regardless of if you're married. Go ahead, just a little bit. Okay.

All right. Well, I wouldn't, I wouldn't base a marriage decision on a 45 minute commute. So I would say, if you love her and she's the one and you guys want to get married, do it. I mean, get married.

And, you know, so many stories. I still had some school left when Winston and I got married. And it was for a short amount of time. But I think there is something. Dad might, my dad might roll his eyes at this.

“But there is something kind of, I think, sweets when you start off.”

And you guys are just hustling. You know, like, you'll look back on these years and be like, these were the simplest times. You know, she wasn't school. She was like, okay, okay, okay, I know. They have some times it's like, oh, I have a life of so much better when you're doing well financially.

But yeah, so there's, I don't know, something about that. That's, I think great. And again, it's all if you guys feel like you're in a good spot. Relationally and spiritually and all of that. I mean, I was, I got married super young.

So I'm, if, if she's the one, I'm definitely not against it. And I think she can do make that 45 minute commute. And I think that's fine. Yeah, she's going to be making a 45 minute commute anyway, because she's with other parents. It's 45.

Yeah, but I wouldn't wait five years to get married. No, and I wouldn't make it, yeah. That's the thing. That's the thing for me is, you know, I, you know, we encouraged our kids to get out of school before they got married. Rachel obviously chose to do that.

She came in and said that.

You always said this, but we really want to get married in December and I'll graduate in May.

And we really, really, really, really want to get married. And I'm like, okay, that's cool. So we worked it out. And we all got, let us get married that young. It's still left all the time.

I mean, it was, we like to mention a lot. And so that's simple. And he's a stud. So, you know, that, that's kind of the thing. And so if you, if you've, if you two have your act together as Rachel's point,

yes, then it won't interfere with her completing school. And it won't, um, and it, you know, you're not holding each other back. There's no desperation in this. And I wouldn't sit around weight five years to get married. I mean, no.

I mean, I mean, we just had a couple on the stage. She's 23. They've been married two, three years. They got married young and paid off their house and, you know, made some big adult strides. Yeah.

So just because you're young doesn't mean that it can't be done.

“So yeah, you just, but you need to do it from healthy spots.”

Both of you being in a healthy spot. Yes. And it sounds like you are. I didn't hear anything in this discussion. It's like needing us on her part or your part or something like that.

Right. That's the only question was timing as what I heard anyway. So if I were in your shoes, I would be engaged and be married as soon as possible. Within, you know, within recent. So I would not wait two years and three years and four years and that kind of stuff.

I didn't, and I don't, I don't tell people to do that. All right, Sarah is in Baton Rouge. Hi, Sarah. How are you? Good. Thanks for taking my call. Sure. What's up?

I attended financial peace university and I taught a follow-up of the baby step principles. I'm get free except for my mortgage and I'll pay that off next year. What are you doing? I am single. Yeah. I'm single.

For the first time on my life, I'm self-employed.

I was contributing 15% to a law for a 1K when I was employed. I want to continue to stay 15% for a time. But I don't know if I should deduct the self-employment tax from a growth income first. And then figure the 15% of you, I just look at the growth income and take 15% of that. We teach people, we teach people to say 15% of the growth that baby step four, and that's where you are.

So 15% of your growth. It's the same thing on your, if you're a W2 employee, before taxes are taken out, we figure 15% of that growth. It's the same thing. Okay. And you just got, with self-employment tax, you've got, when you're a W2, you've got half of that.

They say 7,6,2, plus you're 7.62%, and you've got the whole 13, you know, the whole 13%. So. What's medical? And Medicare and everything. So yeah.

So it's 15% plus your income tax.

“So that's what the government does to us.”

So there's a lot coming out. But that's, you know, the only difference in you in a W2 is you've got an extra 7% coming out. Because I mean, Washington's here to help the small business person. So they double tax them. So that's how that works.

But, you know. Yeah. So yeah. Yes. Job's there, though.

Way to go. Way to go.

You're killing it, kiddo.

Very well done. Evan is in Corpus Christi. Hi, Evan. How are you? Hey, David Rachel.

I'm honored to talk to you all today. You too. A little short on time. Go straight to your question. All right.

“I'm looking for permission to spend some money on a truck.”

Just hold our house and my wife and I have never been sitting on this much cash before.

We've been in a little bit of a mess. And so we're crawling out of it. And putting that kind of... How much debt do you have? I'm pause and pull in the trigger.

How much debt do you have? No debt. No debt. What's your net worth? We have 210 in retirement.

We're both 29 years old.

“And we're sitting on about 150,000 cash.”

Okay. And how much of a truck are you talking about? I'm just struggling to pull the trigger somewhere at 20 to 30,000 dollars. I make 120. Okay.

What's the other car more? She got an expedition. Probably not 22. Okay. All right.

Yeah. If you've listened to the show, you know that we tell people not to buy cars and things with orders and wheels, totalling more than half your annual income, it doesn't sound like it is. And you're paying cash. And so that's the two things we tell people to do.

20 is a debt for a fine. Obviously you're using part of your down payment money towards the house when you do that. You're trading it off for a truck.

“But pay cash for it and make sure it's in that 20, 25 range and you should be okay.”

That puts us out of the ramps you show in the books. We'll be back with you before you know it.

Remember there's ultimately only one way to financial peace and that's to walk daily with the

Prince of Peace Christ Jesus.