Build Wealth Faster by Understanding Opportunity Cost

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.”

Open phones here at AAA-8255-225, it's a free call and some say the advisors were exactly what you pay for it. Ken Coleman Ramsey, personality newborn bestselling author and host of the Uber popular front row seat interview show on the Ramsey Network. She's my co-host today as we take your calls and your questions.

Thank you for being here. Ray, you start this off today. Hi, Ray, how are you? I'm doing fantastic Dave, how are you? Better than on-deserve, what's up?

First off, it's an honor to talk to you. Me and my wife found you back in January, we both read the total money makeover and actually this Friday, we drove to town and sold our my dirt bike and with that check, we'll be able to pay off our auto loan and be get free. Wow, look at you man, game on.

We're yeah, we're excited. My question today though is about our family business. So I'm a third generation farmer. I'm 27 years old and we have had a tough couple of years on the farm.

We've racked up about $2 million of debt in the past two years.

And we keep getting better in the future. So we'll hopefully be making more money, you know, markets and all the other factors going into that, but we've had to do a lot of differing up being equipment and a lot of other things to make it buy it as to this far. And so my question is how do we from this point on be debt free, but also trying to not go back

“to going into debt in the future when things get tough again?”

Wow, $2 million of losses in two years. Yes. So I guess I should say, last year we made about 12 million in revenue. And, you know, my milk market is our main exposure to price risk. We've milk quite a few cows.

And so it's very regulated on the federal milk marketing order. And so we don't really have a control over how much we get for our milk. We yet mainly have control over the expenses. So we've had to build without updating equipment. We haven't been able to do a lot of different projects that we've been wanting to.

A lot of our amazing employees and guys we work with have been going with smaller pay raises.

These past couple years just so that we can get by. And the we've had to liquidate cattle to try and, you know, break even. And it's been difficult. We see getting better in the future.

“But why? No, we're going to want to pay again.”

Why do you say getting better in the future? Uh, you know, a lot of it has to do with my dad. You know, I trust him a lot. And, you know, when we talk about, you know, what markets look like in the future. Whether it's, you know, ag in general or just, you know, milk prices going forward.

We keep getting better. And I trust his judgments. And to be honest, we've gotten this far as we have because of him. And, you know, many other friends that are in the similar boat. As we have probably five X times amount of debt.

And they don't see a way forward. And I'm grateful for what my dad has done to get us to this point. And, you know, I'm, I'm competent and trust him in that aspect. And, you know, I see, I'm not of experience. And as you can tell, I'm only 27.

Yeah, I appreciate that. I appreciate that. I appreciate your honoring your dad. That's awesome. I am, and I, I mean, just a blind trust of him is not what we need.

We need to have a reason that he thinks the market is going to adjust so that you can become profitable. And I don't know enough about it to come in on that one way or the other. So, the thing is, I mean, obviously, you keep expenses down revenues go up. The difference is called profit, right? That's no kidding, huh?

And so, as that happens, you clean up the debt first before you do capital expansions.

And, uh, from this point forward, you start setting aside percentages of your profits for retained earnings. So, that you build a cash war chest. So, if the markets were to cycle down like this again in the future, they don't take you out. And, um, that's what we do at Ramsey. We take a percentage of our gross revenues of our net profits every month.

And so, when COVID hits and we lose, uh, you know, a bazillion dollars worth of revenue for a few months there, we don't go out of business because we're sitting on a war chest of cash.

“And, um, that's how you build up in the future.”

But, of course, in order to get there, you've got to, you know, experience a turnaround in the marketplace, which, again, I have no expertise to comment on that one way or the other. Yeah, we're flying blind on that. I do want to ask a derivative, though. What is the biggest driver of, of you going into debt?

Is it that lost revenue? Are the expenses are out of control? What is it? Well, it definitely is lost revenue.

Well, so this last year, my best, you know, I don't have the numbers in front of me, but say about 12 million in revenue,

whereas in some years, you know, back in, I think it was 22, we made well over 16 in revenue. So it, there is a lot of swing, especially these past couple of years in, in no prices. And we've, we've tried to, you know, cutting expenses, like I said, and trying to make do with, you know, the small margin. So in my hearing, so is it a drawback from consumption because of pricing?

That's caused that $4 million gap? Well, in terms of, you know, our production is paid pretty consistent. Okay. You know, the, in terms of pricing, there's a lot of, it's a price, it's a government price control, and then they just took the right stuff.

Yeah. Okay. And so they drive you out of business with it on day. So, um, you know, it's not as competitive, right? So, right competitive, right, not in the state.

Well, and so the reason I'm digging into that, I wanted to make sure I totally understood that, I don't know how you can have confidence.

“And I'm just kind of circling back to something Dave said, I think there's some wisdom there.”

I love the, uh, honoring your dad. But I mean, if this is a government problem, then I wouldn't have a ton of confidence in less the milk lobby, and I'm speaking in general terms here. I know it exists, uh, but that's your only weapon to kind of fight this or else you're stuck. And so as you're looking long term, uh, and again, I don't have great knowledge of it.

I can look at it from a macro standpoint. I understand it, but I would be looking at that and making sure that I know what's going on. Am I talking to the lobbyist? Do I know what they're projecting Dave? Because I mean, your, your hope is, and your dad's hope is, is that the pricing structure moves

back up, and you're in the 16 range again, instead of the 12 range, which makes you profitable.

Right, you clear the two million and you pile cash up.

So the next time this happens, you don't go into that. And you pile cash up so that you can do your capital improvements with cash above your emergency funding. You know, and, and so the next time you have an upswing, you use it for, you know, much more wisely. What do you do though?

And again, I'm asking for no macro control over what the government does. And, you know, when they're going to set the price, right, somewhat arbitrarily, um, and that scares the crowd out of me. I wouldn't, that, that as a business person, yeah, I'm going to enter into a business that I live and die based on the whim of the latest administration.

Yeah, oh my god. Yeah, shoot me. Hmm. Um, that scares me. Dad, I don't, I don't control my own destiny here.

And so, um, the markets aren't, and even free market is not controlling the pricing. No, it's just a subsidy situation. So, I don't know that, that, you got to figure all that out. And long-term, you got to figure out, do you want to be susceptible to this? .

If collectors are blowing up your phone every day, and you're living in constant fear of the next call, you're not living, you're surviving. You don't need more noise or more stress. You need help, you contrast.

“That's why I recommend Guardian Litigation Group.”

And isn't a call center reading from a script. They're real attorneys who can step into the courtroom and fight back when creditors try to sue you. Dad settlement isn't glamorous. It's not the preferred path.

I'd still rather see you pay it off the old fashioned way. But if you're overwhelmed, out of options, and trying to avoid bankruptcy, Guardian can help quiet the chaos and give you a real way forward with no upfront fees.

Their attorneys have helped more than 55,000 people settle over $600 million in debt.

And when the noise stops, you can breathe again. To learn more, go to GuardianLit.com/Ramsy.

It's funny advertising.

Results may vary, and no specific outcomes guaranteed.

[Music] Tom is with us in Sioux Falls, up the Coda High Tom, welcome to the Ramsy Show. Hey, Dave. Thanks. Sure.

What's up? I am a Master Electrician, working for another Master Electrician for last four or five years. And I recently discovered that we're about 20 weeks behind on payroll, quite about $18,000. I'm looking for some advice on... I'm sorry.

“You haven't been paid in 20 weeks, but you recently discovered that?”

I've been getting paid, but not, you know, like, two pay periods in a month, or three pay periods in a month, not four, and it's accumulated into, yeah. And in February, the most up-to-date pay period I have is October four. Why are you just discovering this? Well, that's a phenomenal question.

It's definitely my fault that I have failed to realize it for this long. I've been building a house, I just had a baby, I got married this year, and it just... Which would be all the more reasons I counted on my pay tax. Absolutely. Okay.

So why is the guy not paying you? What do you owe you? Well, it used to be a company of five employees, and then everybody laughed, and it was just hand in myself, and then he got spift on a $25,000 job.

He put a lean on the property, but never got paid for it.

And I think he just transferred that deficit from supply stores and blinds of credit to not paying me because I don't charge interest.

“But never bothered to discuss this with you.”

Correct. And when did you discover this? I discovered it the week before last on a Thursday. Okay. Have you found a new job yet?

Well, I'm not working for a truck, why would you? Yes, sir. Yes, sir. I agree with you. This concern is that I file a wage claim, and he declares bankruptcy.

Oh, that's probably very likely.

Yes. That's not, you're not going to get the money by sticking around, though. You discovered he's a snake. Now that we've established that, we also know one thing about snakes, all they do is bite. They don't do anything else.

They don't be shocked, and don't think the snake's going to turn into a rabbit. It's a snake. Leave. That's part of the moral dilemma I've been having in my life. Not a moral dilemma.

It's common-freak in science. Well, I have not been working. You know, I made it clear that I don't want to work until we're paid up, but my thought was by creating the illusion that I would continue working for him, maybe I could get some of this money paid up before I tell him I'm leaving.

Okay. Let me try one more time, okay. This guy doesn't pay people, and he lies about it. That's not going to change based on any action you take. This is a guy.

This is what he does. He's a liar and a thief. That's who he is.

“The best thing you can do with lies and thieves is to distance yourself from them, so that”

you don't get lied to and stolen from him. I'm afraid. So I'm afraid, sir, you've lost your money because you didn't keep your finger on the balls. And that's on you.

It's also on him because he's a snake. But dude, you need to get a job yesterday and quit trying to figure out a way to get this snake to not be a snake. He's a snake. Yeah, I just think you're afraid of something.

That's why you're doing this moral stuff and throwing these words around. That's all that is as you justify in your lack of inaction. And you've just been too less than you've got to learn here. You have not been paying attention on what's going on, cost yourself a lot of money. Number two, you're afraid to step out.

You think this guy's the only guy that's going to pay you and you're in one of the most sought after trades there are right now. And there's a lot of need. There's a line around the block of people on your master licorice. There's such a shortage of people in the trades.

So you can go get something tomorrow and you should have yesterday.

Do you think I just take that and run?

Yes. Yes, like instant. That's a cooking area. Yeah, yeah. I won't follow wage claim if you give me a truck and a trailer worth what threw you

owe me. A hundred percent. I don't follow wage claim on you with a state. Yeah, that he needs to do that and that's redemption for his theory. Okay, yeah, take them and then, hey, maybe you set up shop for yourself then if you've

got a truck and a trailer, let's go, baby. Yeah. That is the plan.

“That's a guy I can trust to the guy in my mirror, right?”

Very true. But now, you're going to have to have someone help you with the books because you don't

pay attention to him much.

Sorry, Tom, you walked right into it, buddy. I love you, man, but yeah, you can be a good electrician in a bad business man. So be careful if you're setting yourself up in business that you learn the business skills too. So.

Wow. Ouch, you know what that is, that's the guy who works his butt off. That's right, he works hard and most of everything he's gotten, he's outworked everybody else. Yeah.

And he thought he could outwork this. And folks, when you get in a situation like this, what you can't do in Tom's a nice guy and he's an honest guy and a good guy, we're picking at him a little bit having some fun, but we've all done things like he's done. And he did, as he took his personal character of high work ethic, high honor, high integrity

and tried to superimpose that back on the guy who's a snake. Because he thinks other people are going to be like he is.

“And, you know, what that'll leave is a scar.”

Yeah, it already has, here's the great news, until the very end of that call, we thought he's getting nothing and so the lesson here is, and again, not picking on Tom. But there's fear. We didn't have time to break it down, but for him, holding on. And I'm going to tell you, fear of the unknown just holds so many of us up, us all caps.

I've done it. When we don't know what's next, right, whether he goes out on his own or he's got to get out on the street, you will put up with things that you would not normally put up with. And I'm telling you, for everybody listening and watching, there's a lesson here. He's terrified of something, maybe just change.

And that's normal, by the way. It doesn't make Tom a weirdo. That's all of us. So, learn the lesson there that when we have that fear, the fact that he called us today is good.

Get some insight from other people, Dave, because what will happen is, is you get into this, you know, in this loop that I-- The illumination. The room and thank you. That's the work.

And it's really dangerous. You can hold it back a lot of progress. So, I spoke at a church yesterday, and between services go out and talk to people and all this stuff.

“And, and I came up and he's like, how do you get over the fear running your own business?”

And I said, I'll let you know. Yeah. Great, Steve. Right? Right?

I mean, the editor, John Johnson of Ebony Magazine said, the entrepreneur is the only person who can go from sheer terror to sheer exhilaration and back every 24 hours. Right. And so, yeah, that's-- so, yeah, I got me a truck and I got me a trailer, but, and I have the skill.

But now, good. That's scary. It's scary. And it's scary. And it's scary.

You're right, too. That's very good. Well, I, I tell you, that's a good guy. Couple of lessons. So, if you listen to this show, you can learn things.

That's the idea. It's not just entertaining, although Ken is quite entertaining. But the, but the, you know, two takeaways is, one, you got to pay attention. What's going on? Yes.

In detail. Yeah. Because no one else is managing you, but you. That's right. And then, too, is don't try to make a snake into a rabbit.

They're just snakes. Yeah. But just because you might be a good person doesn't mean you can expect to that of other people.

You, you can't always expect other people to react the way you are going to react, to do

what you would do in that situation. Because let me just tell you, if Tom was in charge of the payroll, the first day he couldn't make a check, a payroll check. He would've been sweating and terrified, and it would've said it until the guy. Day one.

That's right. He wouldn't have lied to him. (upbeat music) , running a business is hard work.

You don't have time to moonlight as your own benefits department.

“That's where health trust financial helps.”

In fact, health insurance is one of the biggest and most confusing line items in your budget and most of you are overpaying because you're stuck figuring it out alone. You don't have time to figure out all the fine print about networks and deductibles. My friends at health trust financial have been helping Ramsey listeners for over 20 years. Their focus is simplifying health insurance and serving people with empathy.

No pressure, no games. They give you clear, unbiased advice that fits your life and your budget, most of their clients save hundreds of dollars every month. That's real money. You can put back in your business or into the baby steps.

So stop wasting your time, your energy, and your money. You run the business. Let health trust financial handle finding the right health insurance. Go to healthtrustfinancial.com today. That's healthtrustfinancial.com.

[Music]

“Everyone to see the person who's calling in to ask a question being the room when we”

answer it. Now as your chance, the Ramsey show is going back on tour. You're going to experience live Q&A crowd debates, local debt free screens, even raw confessions. Yep, we're going to be in Charlotte doing one show.

We're going to do one in Denver, one in Phoenix, and one in Anna, I'm all in April. There's around 300 seats tonight, last year we sold out in 72 hours. Grab your tickets right now at RamseySolutions.com/events or click the link in the show notes if you're listening on podcast or YouTube. Ken, what are those are you going to be in?

All four days. Wow. They got me in the anchor spot, so I'm trying to keep things somewhat controlled. We're trying to keep it on the rail, Rachel in the rail on the rails. It's a hard work.

That'll be a hard work. It's a lot to ask of one man. I'm excited. It's going to be fun. Ethan's in Salt Lake City.

Hey, Ethan. What's up? Hey, Dave. I'm so glad it's you on the air. I've been listening to you for a little bit and I'm like, you know what, I need a good

but you and from Dave. I'm just going to leave the studio.

I've never heard anybody ask for it.

Wow. Clearly. Careful what you asked for. No, I need it. So, what's going on?

I mean, I got really great job. I mean, I've made six figures. I made about 140 last year. Good. What are you doing?

I've been really blessed. Industrial refrigeration. Good for you. Well done. Okay.

It's, yeah, a really good trade. Work for my dad. He takes care of me. But recently, a lot of house from my dad. They moved and he took a hit on film house by gave us 100,000 gift as a down payment.

And that also left us with 150k in equity. And I was like, I mean, the stuff up in life might as well take it.

“And the payments, they were like, oh, it would be tight, but you should be able to do it.”

And my first mortgage payment come out and we're getting ready to have a kid and I just

paid out right for the kid and I want to make checking account go and I was like, oh, and then how much is your mortgage payment sure? So it's 32, 50 and about 3,700 total with utilities. Okay. Mortgage payments, not your problem, it's your truck payment, how much is it?

Um, so my, I actually don't have a truck, my company pays for truck and gas and everything got a car for my wife because the other vehicle we had broke down. How much is your vehicle for your Wyatt payments, sir? 114. Okay.

What other debt do you have? Um, so recently also found what I thought was going to be a investment, um, some mineral rights in Idaho and so bought that, that's about 400 a month. Um, that's 4,000 total there and then I thought I was a big boy with a big boy job and I saw bike pedal bike, but it's the Ferrari of the pedal bike world and okay, so you

problem, I guess you have.

Yeah. Yeah. So sell the pedal bike to sell the mineral rights and get yourself on a budget and stay out of restaurants and go at buying crap. Is that going to work?

Yeah. That's, uh, what I'm going to do and I just, yeah. So what will the Ferrari bike bring? Um, so it's actually pretty good to return, um, I'm trying to sell it for 9k, which

“is about 5,000 under what it should sell for, but I don't do that's what I want.”

Okay. Yeah. I'll get rid of it. Okay. What about the mineral rights?

Um, so it is a, we used to own, so I'm, pan the guy, um, I could reach out to him and see if I can cancel a contract. Yeah. Let's do that. I'll do that.

Yeah. Yeah.

I don't want to need to do to be out of this because I can't afford it.

About a house. I got a kid on the way and I'm broke. And I can't, I got, I got to get, I got to have some relief here. What do I do to get out of this? Just quit paying you.

I lose the rights. Sure. Done. You know, I'll get him back to you. I'll sound back today.

That's probably what it is. So, um, you know, you just got to work through everything like that and so what you do is just figure out the last time something made sense and go back to that point and undo everything since then. That's what I'm doing.

Yeah. Yeah. The house is probably a bit much, but I don't think it's really your problem. I think it's all the other crap. And you don't have a plan.

Yeah. I live in on a plan. You just look at see how much is in the checking account. That tells you if you're okay or not. That's not a budget.

You need a budget. You need to get on every dollar. I'll give it to you. Give you a free trial on it. Get your started.

And then I give every dollar a name. You make freaking 140k, stay out of restaurants, don't go on vacation, get rid of the Ferrari bike in the middle. Right. So let's get this thing to balance.

I think you can do it. Yeah. That's a pretty light budget. That's really not a bad. Yeah.

Just realistically, I've been on the edge of this too far. We were like a car, it's really reliable for her and the kids. Yeah. You probably need to sell it too. I think we need to sell it.

Yeah, probably. I think if I get rid of every thing.

“What if you didn't have any payments about a house payment?”

I think your life would be pretty good. Oh, it'd be amazing. Okay. I think your budget would balance. And all of a sudden you wouldn't have been calling Dave.

So, you know, but you keep buying crap and just going, it's going to be okay. It's not going to be okay. You've got yourself into a mess. Yeah. Take the paycheck.

Yeah. Is anything about that feel good to you? Does this work? I mean, you could get her a 10,000 dollar car. People don't die in 10,000 dollar cars, huh?

Yeah. I want a couple of. How are the kids? It's kind of a sense for my daughter's two and maybe three is any day. My point is, those little don't need the nicest minivan or the latest SUV.

They don't care. They're just going to throw goldfish on the carpet anyway and grind them in with their rhyming little feet. We hear this all the time. It's a rationalization.

You're not the only person who'd ever does it. Oh, I got two kids.

I got a third on the way.

I got to go get a car. I can't afford. And nobody cares. Get your, get your normal worn out minivan that just gets you from here to there. Until you've got a little money piled up and then pay cash for her a little better car.

But you've got, you know, you just been acting like you're in Congress and spending money. You got to stop it. And you know what to do. You already knew what to do for you called.

“And that's why you set the call up the way you did, which was kind of humorous and fun, by the way.”

But really, I mean, looking the mirror, you and your wife go grown up time three little babies, and stupid, but stuff has to stop. And, you know, this is grown, this is what the kids got. Adolting. Yeah.

Yeah. We're Adolting. Okay, Dave, question for you. I haven't asked you for a while. What is going on in the, in the mind of a human, because we've all done this, where

there's this awesome feeling about getting the Ferrari of pedal bikes. And, and you know, deep down that you can't afford it, but you still do it anyway. What's going on? They're not looking, no one looks at whether they can afford it. What happens is, when you do not have an overall plan, like a budget, okay, and a detailed

game plan of this is what we're going to do with our money on purpose. It could be a Ferrari bike. I don't care. I mean, you buy whatever is in your detail plan. When you say, can I afford this couch, and you look at it as a part of your overall

life plan and the numbers, then you can tell if you can afford the couch. And you're just walking through the furniture store and you're disconnected from all those other numbers, then you go, of course, I can afford the couch. It's only, you know, whatever. So, I can of course, I got a $49,000 battery bicycle, thingy, whatever.

But it's the Ferrari Tesla of bicycles, but yeah, probably catches on fire.

I can afford that boat. I can afford that. When you don't look at it as a part of a hole and you look at it as a stand-alone thing, then you go, I make 140,000 dollars, you're not going to afford a $10,000 or thing.

That would be true if you don't look at it as a part of the overall picture. But when you plug it into the overall picture, it screams insanity. And same thing with your car purchase, same thing with your house purchase, all these things. And you just go, yeah, if I didn't have anything else to think about except this one couch, sure.

But lots of time, but we never do that, and so it's not, it's compartmentalizing

rather than looking holistically causes us to be insane. When you've saved up and paid cash for a reliable used car, you want that thing to last.

“And the best way to keep it running for the long haul is to take care of it with people”

you trust. That's why I'm proud to welcome Christian Brothers Automotive as the official auto repair partner of the Ramsey Show. At Christian Brothers, they treat you like family. You'll get digital, vehicle inspections, so you can see exactly what your technician sees,

a complimentary shuttle to keep you moving. And every repair is backed by their nationwide, nice difference warranty. They've even been ranked number one by JD power for customer satisfaction among aftermarket full service maintenance and repair providers six years in a row.

Visit JD power.com/awards for the details.

So if you want your paid for car to keep going and going, trust Christian Brothers Automotive, visit CBAC.com/Ramsy to find your local shop and get an exclusive Ramsey discount of 10% off your visit 10% off up to a $250 value, see store for details. Patrick's in New York City. Hey, Patrick, what's up?

Good afternoon, gentlemen. Thank you for taking my call. Sure.

“I'm 66 years old, in relatively good health, still working.”

I own my own business. I have a net worth of $9.5 million dollars and I want to make sure it's in the right place and by the grace of God and a lot of years follow in Dave Ramsey from a bunch of different shipyards throughout the US, another discipline paid off. Man, you're amazing.

10 million dollar net worth, dude, I'm proud of you. Yes, sir. Wow.

Just to be clear, I've never lived high on my hog on first generation Irish Catholic

out of the Bronx, so I'm not impressed by your, do you say Ferrari before, and that's sort of thing? I live very simply and I'm very content. Good for you. Good for you.

How can we help you, sir? We're amazing. Right now, I have approximately $580,000 in cash in the bank. I have another $3.9 million in CDs with various maturity dates, 4 or 1 case from my corporate life in my earlier days working for people.

I have approximately $3 million. I have approximately $1.4 million in properties. There's no mortgages, and they generate about $8,500 a month gross before taxes and that sort of thing. I own three vehicles that are less than a year old, they're all paid for, and my day

variety of emergency cash for them, the proverbial cookie, has about $30,000 in cash. Well, plus $580 in checking. Yes, sir. And $3.9 in CDs. Okay.

Wow. Way to go, man. So how can I help again? And I'm still working.

“Should I move that cash at roughly $580,000 in cash?”

Should I bring that into, I don't really need it. I'm not trying to sound high-faluten. Should I move that into CDs? Should I put that in some other investment? I have two adult children that are self-sufficient, and obviously, please, God, when my

time comes, all of that will be done. I do have a will, but I do not have a revocable living to trust the will. Right, trust. You don't need one. I do not have that much of a percentage of my net worth in cash, in CDs in cash.

You're not even using the income off of that $3.9 or that $580 for that matter. And those could easily be put into something very simple, very low keys into some mutual funds, and make you about three times more money. And so if you've got $4 million and it earns you $3% or what is that? $120,000 a year, then I do that, right?

Yes, sir. Okay. And if it doesn't earn you 3%, but it earns you 10%, that'd be like $360,000 a year. So that money sitting in CDs cost you $4 million last year. It should have been invested well.

And so something to think about.

“I mean, and here's the thing, if you've got it in good mutual funds and the stock market”

doesn't earn, what it always earns like last year, it was like ridiculous.

It was crazy. I mean, we made like 26% of our money last year, but that's not real. This year we're down 5% here today. So we have a little war going on in a couple of other things. And so, but the overall market, let me look right, I just pulled it up a minute ago.

It's, no, it's down 2% here today. So you would have lost a little bit since January 1, after having made ridiculous money last year. So, but the average is you're going to make way more than you would on a CD. And that's why I don't park that kind of money in cash unless I'm using it for

something like retain earnings here at the company. We've got substantial cash position with that. But in terms of my personal investment portfolio, very small percentage is actually sitting in cash. If I'm parking money, like I've got some money right now as an example, parked in an S&P 500

fund. So, just a mutual fund. And I'm going to be buying some real estate with it later. But instead of leaving it in a CD and waiting to I real estate, I'm leaving it in there earning three times more on average than I would have made on a CD while I'm waiting.

Now, right now, that money's lost 2% since first year. But I'm really not worried about it. It's 2% doesn't matter one way or the other because I'm probably not going to touch it next few months and by then, you know, I'm sure the market will be back up.

So, anyway, all that to say, you've done an incredible job, I'm so proud of you.

If you leave it exactly with the way it is, you're not doing anything wrong. But could you turn the knob a couple of clicks and make another $2,300,000 a year on this money? Probably by sitting down with a smart investor pro and learning about some places to park that instead of CDs instead of in cash, cash equivalents.

Patrick's going to lose a little sleep tonight off of that revelation that you gave him. Yeah. Everybody's done so well. I mean, this is by the way. He hasn't done anything wrong.

This is the baby steps millionaire right here, living on less than 10 millionaires. I know. Unbelievable. Right at 10 million. Way to go man.

I'm just so proud of it. It's great. But this is like you did a 99 or 98% great job and all we're doing is just clicking it on that 2% so nobody's criticizing you Patrick, you got it man. If you leave it exactly the way it is, you are a stud.

Yeah. I'm so proud of you. Very, very well done.

“So folks, here's the thing you want to think about.”

And this is the concept we're teaching right here. It's called opportunity cost on your money. When you take a block of money and you put it in one thing, buy definition. It cannot be in the other thing. It loses the opportunity to be in the other thing.

And so if you take $100,000 and you buy a car, you not only bought a car, but you lost the opportunity to invest that $100,000. That's what opportunity cost me. So let's say you had that $100,000 invested last year. You would have made $25,000 on it last year.

And instead, you bought a car for $100,000 that is now worth $40,000. And so you traded a hundred for 40 instead of a hundred for a hundred and a quarter. That's the opportunity cost. Now it's okay to buy a car and they all go down and value. There's no exception to that.

But anytime you're looking at something going, I'm not only making a purchase decision.

“When you're buying the Ferrari of bikes, what else could I have done with that money?”

What's the other option? What opportunity did I miss out on?

And so if you got a million dollars invested or it's sitting in a coffee can in your backyard

in cash and it didn't make a dime or it could have been in a gross stock mutual fund last year and would have made $250,000.

Yeah. It's a great illustration. And I actually did have a guy calling one time that had the spirit and a coffee can. How much was it? It was not that much.

It was like a half a million.

But I'm like, dude, do you not understand that cash and a steel coffee can? No, the old metal coffee can is it's going to rust and then bugs are going to get in there. The cash is going to actually get destroyed. So when your relatives dig it up, it's going to be like this little green powder. That's all that's going to be left.

“And that's what you try that you're half million for because you're a paranoid freak.”

And so, oh my God, very literally, buried it in the backyard. No kidding. I mean, woo, yeah, I actually know a few, I know a few people that their relatives will be out there with the old metal detector, looking through the backyard when the old man kicks it because we're no he's crazy and you bury the money back there.

But you miss the opportunity. That's what you need to think about.

And it's always a good thing to say, gosh, if I buy a $100,000 Mercedes and 20 years later,

that $100,000 would be worth and 20 years later, what's that Mercedes worth? And that's the opportunity you miss by going on one or you miss the opportunity to drive them Mercedes by the way. If you put it all in investments and have no life, so you ought to get a good car too. That's okay.

But just think about trying to think about the idea of the purchase or the investment as a only this, if I do this, what am I else could I not do? What opportunity am I missing? And so I guess, you know, in modern lingo, we might call it FOMO. Yeah, it's exactly right.

“The FOMO of finance is opportunity cost, and that's what we're talking about with him.”

If you had that 3.9 million invested in city sitting in CDs, you missed the opportunity to make another quarter of a million dollars.

Hey, let's play a quick game of wood, your rather.

Would you rather keep overpaying your phone company every month or save 600 bucks a year with no contract and no price hikes ever? Easy answer. That's why I love boost mobile. With their low rates, you can unlock up to 600 bucks and savings over the so-called big

carriers. You can bring your phone, keep your number, and pay just 25 bucks a month forever on the unlimited plan, because you've got better things to do with your money. So go to boostmobile.com/ramsie to make the switch today. Based on average annual payment of AT&T for rise and anti-mobile customers compared to

12 months on the boostmobile unlimited plan as of January 26th. See website for full details. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio. In Coleman Ramsey personality, number one best-selling author is my co-host today. The number is triple eight, eight, two, five, two, two, five, and she's in Chicago.

Hi, Angie. How are you? I'm fine. How are you? Better than I deserve.

What's up? Well, I just want to get some advice. My husband and I are retired. He's 65 and I'm 70 and our home is paid for and so are both of our vehicles, but we have a lot of credit card debt and it's on a chip in us so that it's hard to make groceries

even. So I just look in for some direction. How much credit card do you need? We'll go for a hard time. It's probably $35, $40,000.

Okay. And you both work part-time and you're collecting social security. Yes. And he gets a small disability pension from the military and I have a small pension from.

“So when a pile, all of that together, what's your monthly income?”

About $3,000. Both of you are also security and both of you are working and both of you have a pension and you only got $3,000 coming in. All right. It's a very small pension.

Very small social security. Yeah. He gets 16, 25 and I get 12, 50. Total. Right.

Does that include your jobs? Um, the jobs are getting $400 a month and he gets paid by the job. He does trailer repair. But there is. Okay.

And what are your cars worth? My car is probably worth $5,000. He's got a truck.

What's your home worth? About $300,000. Okay. And how is your health and his health? Good.

You're close so far. It's good. Good. Good.

“And I have about $13,000 and I'm all right.”

Good for you. Okay. All right. Well, two things come to mind immediately. One is you can't do this backward and expect it to work.

You don't pay the credit cards first and then figure out how to eat.

You eat first, keep the lights on first, keep the homeowners insurance paid first, keep the gas and the car first then with what's left, you pay what you can on the credit cards. Credit cards are not first in line, they're the last in line after you survive. Okay. So it's not like after we pay our credit cards, we are the money for groceries.

No, it's after we buy groceries, we are the money for credit cards. You see the difference? Yeah. Yeah. So that's the first thing we adjust.

The second thing we adjust is, I mean, you're only 65 and 70, get a job. Well, we both are working. Part time, making nothing, $400, I mean, you're starving to death. You're too broke to retire. Well, that's true.

Yeah. I mean, what if you guys went to work for a year, like full-time jobs and made 30 or 40,000

“bucks each and you paid off all these credit cards?”

Right. Yeah. Yeah. I thought, you didn't think you was going to hear that today, did you? It's not what we wanted to see.

It's not just a lot physically, physically honest, I mean, they weren't good. Wow. Not telling you to wait tables, but I mean, I'm talking to an intelligent lady that can carry on a conversation. There's a lot of customer service stuff you can do.

It's not physically draining. Here's the question I have. I'm listening to your stats, Angie, and I don't think I've ever been on a call like this where I've heard somebody who has a paid for house, paid for cars, and you have $35 to $40,000 credit card debt.

So what is the cause of that? It's just accumulated over time.

There's just always been, there's just always been a lot of more expensive than we had

income, and it just kind of accumulated, and then when we didn't buy groceries and we put it on a car, or when I needed $1,500 or with a car repairs, and didn't have $1,500 on me. I should have done a credit card, things like that. Well, we're going to have to spend enough more years in the work for us to reverse the trend, to get your incomes up and enough of an estate, a little bit of an estate built

to where it doesn't leak again down into this, but cut up the credit cards and let's go crazy and get them paid off. I'm not asking you to sell your house, but before I keep this credit card debt around five years, I would sell the house. Instead, if it's me, I'm going to roll up my sleeves and go do something, and just get rid

of this mess. It's just lingering, and you guys are walking around acting like you're retired in your broke, and the good news is you've still got your health, and in today's world, 65 years old is not that old.

“I am, and I work, so, you know, and at least they claim I work, I think we could call”

it work, and we show up pretty regularly, you know, so, you know, yeah, you can do that. You can go do something. I don't know what your past career was, but go pick up a job doing that as a consultant or anything, and him too, and you know, again, you don't have to go swing a hammer, and you don't have to do something, you know, carry a waitress tray of 800 pounds or something.

I'm not asking you to do that, but I think there's something you guys could do to generate a few thousand dollars a month, and a few thousand dollars a month, and make this credit card that go away. Yeah. Because it needs to go away for ever, this is not a sustainable situation.

So first thing is reprioritize and take care of you, what we call the four walls of your house, food, shelter clothing, transportation, and utilities before you pay any bills. You eat first, then you pay bills, you don't pay bills, and then hope you can eat. And secondly, we got to get your income up to be able to address this overall issue, or we got to start selling stuff to cover it, and I don't think that's viable here.

I don't think your house is crazy.

I mean, if you're living in a million dollar house or something, I'd probably have you

moved down in house and clean up this mess. But your house is not out of control, your cars are not out of control.

income to live on.

“And that's what caused the credit card release.”

That's right. There was margin issues.

So here's why baby steps two and three are so important.

You've got to get that debt paid off, but then you've got to have that three to six months of a mercy fund so that you aren't tempted to solve the problem with the credit card. There just was no margin for you to be able to have a rainy day fund. It's really important at the advanced age here to have a really well-funded, I know. Hey, look, man.

I'm not far behind. I'm trying to catch you. But I mean, it's really true, though, because if you have limited income at that age, and a car goes out for $1,500 and you don't have an emergency fund. You fix it.

That's what they did. That's the things that we would tell you to do, kiddo. And hang on. We're going to set you up with a free offering on every dollar, the app. And that helps you put your budget together in your husband's sit down, look at the numbers.

And the numbers are going to tell you, eat first, pay bills last.

That's a short term fix. Your long term fix is create income to clear off these credit cards and shop them all up. Light a candle tonight and have a plastic surgery party. .

“Finally, mortgage rates have dropped, and you know what that means?”

People who have been sitting on the sidelines are about to jump back in to the housing market. So if you've been waiting to buy, this could be your window, but you've got to be prepared and do it the Ramsey way. You need to contact Churchill Mortgage. Their home buyer-edge program gives you peace of mind and a wild market.

You can cap your rate for 90 days. So if rates go up, your protected, if rates go down, Churchill will drop yours automatically. And get this, Churchill will even back your offer with a $10,000 seller guarantee. So if your loan falls through due to financing, the seller still gets paid. That's how confident Churchill is.

Plus when you shop as a Churchill certified home buyer, it's stronger than pre-approval. It makes you look like a cash buyer, which makes your offer rise to the top. So don't let this moment pass you by. Get ready now. Go to ChurchillMorage.com to get started today.

That's ChurchillMorage.com. This is a paid advertisement. Some buyer-agents seller guarantee are available for qualifying borrowers and select them types only and not available in all state of locations. In the MSID, 1591, in the MS Consumer Access.org, Eagle Housing Lender.

“Anthony is an Ashland Kentucky. I bethany, how are you?”

I am so thankful you took my call. I'm doing well, day. How are you guys? Better than I deserve, what's up? So my husband and I are ready to sell everything and change our entire lives. We need your help. Okay.

We started out with $750,000 in debt. When we first started our journey and we met you, and we've got that down to $450,000. Well, actually $439,900 now. Way to go. Let's go.

It's crazy. We have this unique situation where we bought a house. On 125 acres in Kentucky, it's a beautiful farmland.

But we've always known we would want to build our house one day.

The house that's on it is not our ideal home. And I know your principal is if you don't love it. You know, maybe you can consider selling it. And so that's kind of where we are. The house we bought was for $140,000.

It was a steel house and a creek. That includes the 125. So the house in the 125 acres was $190,000. Yes, sir. I got you.

What is the $439,000 in debt? $250,000 is what is left of my husband's medical school in arms. Show your husbands a doc.

Great. What's he make?

“Currently, he makes 325 annually, 16,000 a month as his base salary.”

Okay.

And you have 250 in medical.

And I assume you have this mortgage or something owed on the land. Is that right? It is 162,000 outstanding. So that's a two day. That's it.

That's the whole thing in that. No, sir. It's 19 five for car. It's actually the 10 day pay off. I just called today.

And the 10 day pay off is 19 five on our fund. Odyssey. We have five boys. They just fix an under. And so the is that your only three debts?

$8,400 less on a stall meal. For a total of $439,900. And all of this was purchased after you decided to get our. Before you started decide to get out of debt. Um, I'd like to say that, but we got married in 2016.

And that's when we moved from Ohio to Kentucky and bought a house.

Because the land was a steal. And we we had not yet. We're not getting out of debt. We're not getting out of debt. Did you buy a Honda Odyssey and a saw mill?

No, not since we've got this. Okay. Not since we've got this. Okay. So you're not.

You're not falling off the wagon. You're just plowing through past mistakes. Yes, sir. We want to get out of the stuff. And we're ready to sell everything.

We make $25,000. You've already paid off. $300,000. Um, I don't know why. I mean, and your mortgage is, is a portion of this.

Mortage is maybe step six.

So, I mean, I think you can be debt free with that great income. You, you, you should not have any personal overhead to amount anything. You pay off the saw mill in the Odyssey pretty quick. And then let's tear into the medical debt.

“And you should be done in a couple more years, shouldn't you?”

Well, sir, I, I love that. And, but I'm, my husband and I have been discussing this. And we think that we could get 450 easy out of our house if we sold it today. Okay. And where are you going to live?

And so everything, because we can sell, we can sell the house for 450 if we put the offer for 500. We can sell the saw mill for 30 K. Okay. We can sell the doser for 30 K. We can sell our car for 19 five.

And buy a beater. And I just, and then we're like, where are we going to live with five boys? Do we rent? Do we buy something for about 100 to 150 with whatever equity, whatever what after we sell everything? You know what I mean?

All the assets. I mean, I'm talking full liquidation. Go day brands like we are done. Well, you know, full day Ramsay is not necessarily full liquidation. Okay.

That's, you know, we're going to liquidate with wisdom and to accomplish the goals. But then accomplish the goal you want to accomplish. But for sure, I'm selling a bulldozer and a saw mill. No question about that in a heart beat. And if you want to move, if you don't like the property and you want to move.

Well, sure, you could move down. And that's not as a temporary measure. But then you're seeing there with 3,000 or 25,000 income is zero debt.

“The first thing you're going to do starts stacking cash to buy into the piece of real estate, right?”

Right. Yeah. And that's okay. But just think through where you're going to live and what you're going to do. Let's not do this impulsively.

I want to have a strategy. You know, okay, my desired feature is to be debt free. What must be true for me to get there? Well, I could sell everything where would I live in the meantime? Okay.

Well, what would I drive in the meantime? You've got to solve for that. If you solve for that and you're okay with the answer to those questions, then do it. But it's not the only way out. You have a fabulously large income.

And you live in an area with zero cost of living. Yeah, I've got a question. If we could just eliminate the debt, some generous person comes along and pays off the debt. Would you want to stay on that property and build a really nice house where you are now? No, sir.

That's the downfall of the property. There's no other house seat to build on. Okay, then shall. See, that to me is the ultimate on should you sell the house. Yeah.

It's not because of that. It's because you're not going to stay there anyway. Yeah. So do it. All right, we rich do a lot of it.

Listen, listen, I rented you. You're not going to stay there. Right. No, I think she loves the stress. Yeah, we want to build a house for sure.

We want it. We want my husband and I have a dream of building a business. That's a multi-generational impact. We're able to grow it into you and it could be a family. Okay.

So that land and this house don't figure into the equation. True or false. That's true. That's sell it. That's sell it.

But that's different than that's different. It doesn't fit into the equation for your future. It's different than I'm selling everything, including every thinking thing I love.

That's a different answer.

And so you're not doing that. You're selling stuff.

“You're going to sell anyway because you're not staying there.”

If you could, if you win at the end of the game, you're not on that property. And so sell it now and advance the piece around the board. Yeah. That's what you're saying.

Yeah. And yeah, it's definitely sell this all mail. I don't know what you sell. Stupid car or not. Again, you've got a 325,000 dollar income.

You ought to pay that car off a couple months and keep it. All right. If you got it since you got a tribe of youngins to run around in a Odyssey with, right? So I don't care.

You make enough money for that to not be my problem.

But yeah, you get rid of the mortgage and the saw mail. And whatever, and the student and the medical debt, hanging around your neck and you rent something for two years. And you buy a big ol' piece of ground somewhere for cash. And then you start talking about how we can build a house on that ground.

And you work your way back out there. And it's a five-year plan.

“And three of those years are probably going to be somewhat uncomfortable.”

We'll call them the adventure years. Yeah. But with all those boys, five boys under that age group, they're going to tear it up anyway. So just go rent.

Let them have some land. You know, get a ranch with plenty of rooms. And I love this idea of now. You've got this doctor who's got a huge upside zero debt. You're actually really fortunate to be in this situation.

You know, to have this. Considering the measurement. Yeah. Yeah. So yeah.

I'm with you. Okay. Could you look at me a minute to catch up? I just want to make sure you're not, you know, only doing this.

And I do want people to get out of debt. And I do want you to sacrifice to get out of debt. And I do want you to do this. But I want you to do it with a plan and with a strategy. Not just, you know, Dave Ramsey said.

Mm-hmm. That's not a strategy. That's right. Okay. A strategy is I want to be dead free for my family.

So that I get control of my largest wealth building tool, which is my income. So that I can invest and change my family tree. And create a generational business. That's exactly right.

You know, you work through your so-that's. That's why you're doing it. And, yeah, I just want to get there as fast as I can. She's saying, "Well, do it. Salute."

And it's over. Pull the plug on it. And by the way, put the go ahead and put the sawmill on the bulldozer under the stupid column. You need to put a check there.

[ Music ]

You know, one of the first things I discovered working in the financial world

is how absolutely devastating it is when the breadwinner of a family dies. And there's two little life insurance or none at all. Grieving families are suddenly left behind scrambling to pay bills and trying to make ends meet.

I also discovered that there are a lot of rip-offs in the life insurance world like that whole life crap posing as an investment opportunity. What you need is level, term life insurance. Usually 10 to 12 times your income,

which is the smartest, most affordable way to protect your family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company.

This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about. They shopped the term life companies to find you the best options and they've been around for over 95 years.

So you know they'll be there when you need them. Zander is the real deal

“and that's why they've handled all my personal insurance”

for over 25 years. I trust them and you can too. Visit Zander.com for instant online quotes or for a more personal touch, give them a call.

At 800-356-42-82. (upbeat music) Are you sick and tired? Are you working so hard? Now, nothing to show for it.

I feel like I'm rat in a wheel, Dave. Run, run, run, run, run, run, run, run, run, run, run, get nowhere. Well, that's normal. Normal's broke. You don't want to be normal.

You want to have a different plan than that. You don't have to live that way. Our every dollar budget app will help you

to start to clean up the mess and then to build wealth

and increase your generosity. Yeah, it gives you a personalized plan to beat death and become wealthy.

“In 15 minutes, you're going to find thousands of dollars”

and hidden margin. We know how to do it. We're going to show you how. And then you're going to have, like, us and your pocket walking around, like, me telling you what to do.

The other arms and personalities tell you what to do the whole time. Start every dollar for free in the App Store or Google Play. Embers in Kansas City, High Amber, how are you?

I'm going to, how are you? Better than I deserve. What's up?

Um, I'll, I'll join my own emotional.

I am in the process of getting divorced and I'm terrified. I'm going to lose my home. I own this home with my daughter. Prior to getting married.

I had $100,000. In her, since put down, I was on payment. So my mortgage was 118,000. Total. After that.

And I met my husband. And he got the mortgage and his name only. My name is on the deed, too. And I found out that accidentally. He had ran up a bunch of debt.

All the house. Against the house and in loans and credit cards.

And this situation became very dangerous.

So I got a no contact order in the judge ordered that he pay for X amount of dollars for so long. And he purposely did not pay on which got everything behind. So what did the judge say then? Um, we use that as means to get him to sign a divorce. Like settlement.

Oh, so you let him off. So he would go away. I know I didn't have a choice. Yeah, you have a choice. You just chose to let him off so that he wouldn't wait.

I don't blame you. But that's what you chose. Okay. So how much is owed on the house now? $214,000.

Right. And what do you make of your home? Last year, I made about $47,000 gross. Okay. All right.

I will my own business out of the home. And I have some of you that's willing to help. Coast signs. No. And we get.

You've already got a mask. You don't need to make it worse. What's the house worth? $300 and $15,000. Great.

Okay.

“What other debts did you take on to get rid of said deadbeat?”

Just what we can put in on the house. So $214,000. About $100,000. Because the mortgage was $118. Yeah, but I mean, you've got a $214,000 debt now.

On the $300,000 house, you make $47,000 a year. All right. How's your business doing? Is it growing? Yes.

How long has he been gone? He had a move out in July. Okay. And you're safe now, right? No.

Why aren't you safe now? Because she still comes on the property. If I keep hiring you tells you, you shut down my cameras. Shut down, shut down your what? Did you call the police?

They won't do anything. You have a no contact order. Of course they'll do something. You can't prove when somebody shuts down your cameras. You can't prove it.

What is your business? I'm on the dog. They care in boarding business. And I make a lot of money compared to doing social work. Which is what I did before.

Yeah. And this is what I meant to do because I've asked God. Okay. You know, listen, stop. Stop a second.

Okay. You can't breathe because you're terrified. So we have to solve for making sure that the abuser goes away or goes to jail.

“Otherwise, you have to go away and reset your life somewhere else so that you can breathe again.”

This is not sustainable. No one can live in this stress. I know, but it's a process because I had it. He was going to be in writing me and so I have stuff turned over to the police.

He's been gone since July and the only thing since since cut down cameras, right?

Yes. Okay. So here's the thing. I can't move because I move it. The same thing will happen.

So running from it isn't the answer. Why would the same thing happen? Because he messes with the technology, like the other day he started with apparently, you can get an app for a sound bar. Okay.

Just a second. Wait, wait, wait, wait. Now we're starting to sound. Okay. Now, okay.

So you need to contact your attorney.

“You need to contact the police and you need to contact your pastor and you need to get some”

people in your corner. It sounds to me like just in the few moments I've had with you that I'm talking to a terrified lady who is dealing with extreme trauma. That's what it sounds like to me. It sounds like my little sister has been through hell.

And now you're looking over your shoulder at every shadow. And I really don't blame you for that because you've been through extreme stuff, kiddo. But it sounds like you're probably going to have to go start a fresh life somewhere else. The good news is you know how to care for animals and you can restart a business somewhere else.

While you work another regular job to get that started and take your 100,000 out of this house and move cities and go somewhere else. And let's just start fresh.

You need a lot of distance between you and all of these events and this moron.

Do you agree with that? Yes. And he's not powerful. He cannot find you when you just simply leave. He's not all powerful.

He's just a moron. He works in ITK's highly intelligent. You've told me that three times. I don't think he's highly intelligent. I think he's a bully and an abuser and a twerp.

He's trash. I don't care if he's highly intelligent. He's not that intelligent. He's got you believing he's omnipotent. But he's not omnipotent.

I'm not impressed.

“You need to leave and go get you a life kiddo somewhere.”

You got to do something different. This is not working. And you know, staying there saying he's highly intelligent. He keeps coming on your property and nobody can do anything about it. Is not a solution to your problem.

That exaggerates the problem. So we have to throw some dynamite in this situation. Something has to change. And I don't give a crap if he thinks he's highly intelligent. I can't kind of doubt it, actually.

I think he's got you believing a bunch of stuff that's simply not true. He's completely got you what we call buffaloed. But I don't blame you. You've been traumatized by the jerk. But I'm telling you, if I'm you.

Oh, wait a minute. Okay, so hey, Amber, do you not have family in the area? No, they live a couple hours away. Good. Go be with family this week.

Pack your suitcase. Get your kids. Call your clients and tell them you can't keep dogs this week and leave. You need some distance between you and this. Does that sound like something smart to you?

You're going to have to take some action steps. Okay, you get because your dad and your brothers need to know this so they can beat the hell out of this guy. Somebody needs to stand up to this guy. Okay, and it's not you. Somebody needs to get between you and this moron.

And you got to get some distance between yourself.

“So you need to check yourself into a domestic violence shelter.”

Or you need to go be with your family tonight right now. Get off the phone, go pack your suitcase and go do that right now. You've got to put somebody in your in between you and this mess where you can get start to get your perspective back. But you have some options. They're not pretty.

But you have some options. [Music] The Ramsey show a question of the day is sponsored by Y-Refi. If you're a private student, loans are in default. It's a mess.

But Y-Refi can help you clean it up. Y-Refi helps borrowers refinance with low fixed rate payments and a clear plan forward. So you can clean things up and get back to making real progress.

That's the letter Y-R-E-F-Y.com/Ramsey might not be in all states. Today's question comes from Declan or Declan. Let me say that right. I think it's Declan in California. I'm 20 years old on my own business and I'm on track to earn $250,000 this year.

The income isn't consistent yet, but it's growing. I have 100,000 in savings. My only debt is 20,000 on my current car, which is worth about 25,000. I'd like to buy a U-C-8 Corvette for 50,000. I could pay cash.

But I was thinking about finding it. It's a part of it to keep liquidity in my business and build credit. My business relies heavily on personal brand and social media. Image and perception matter and a car like this can help with credibility and marketing. I don't want to make a decision that looks successful,

but is dumb financially. Is buying this car a reasonable move if I can afford it. Okay, so we have a lot in that question.

“Well, first of all, we want you to follow the baby steps, right?”

So you've got 100,000 in savings and your only debt is 20,000 on the current car. So we need to pay that off or sell it. And at that point, then you're looking at the used Corvette for 50,000. The question day I bring you in here, I know our formula on assets like a car, which is not actually an asset to appreciate.

If it's in his business and you can pay cash and it's for his business, is that a viable option there? Again, assume he's got the cash. No, I wouldn't buy it for the... But if you make 250,000 a year, can you drive a 50,000 on the paid for car?

Yeah. If you pay cash for it, yeah, you can do that. It's that simple, but all this other crap about it. I'm going to do it. I'm going to do it.

I'm going to look successful or whatever. Here's a good way to look successful. Be successful. Yeah. And it's still somewhere about how you can quite learn about how you look.

The Instagram is not the real world.

“Even if you are making your 250K on YouTube or Instagram as an influencer at 20 years old,”

that scares me. But if your income is steady at 250 and above, you really think you're going to be making that. Can you drive $4 to drive a $50,000 car?

The answer is yes, if you pay cash for it.

Right. And so, yeah, I was so my current car and I would buy the Corvette for cash. But I wouldn't do anything about... I wouldn't run all this credibility in marketing and all that BS through your head. I want to Corvette.

I've got the money. And it's not a big percentage of my overall world. Yeah. You know, our rule of thumb is if you can pay cash for it, it's not brand new. And it's all of the things that you own with wheels and motors are less than half your annual income,

because they all go down in value than, you know, that's okay to purchase that. And don't buy a new one unless you have a net worth and excessive of a million dollars. Those are our three contact rules on vehicles of any kind. Cars, boats, pop-up campers, whatever else, right? And so, yeah.

“So I was in a city, I'll just say, in Ohio last week.”

Doing, yeah, working. We're out there traveling. And we went by. I guess that city they make... Or maybe the manufacturer or something of the...

Of a RVs is there.

I've never seen so many thousands, thousands of RVs.

Like parked all across the side of this hillside. Well, it just blew my mind. That is a lot of rust. That is a lot. Because everyone those think it things are probably 100 grand.

Oh, yeah. And more. And there's thousands of them. Where are those things going? It's just blew my mind.

I felt like a country boy going to town. Like, what are they doing with those things? But I'm crazy. You know, it's funny they're making money on the financing of all those. That's where the money's at.

Because, man, they're in this. They're sitting out there in a field rotting down look like to me. Oh, my gosh. Really. I'm sure they're being shipped to China or something.

I don't know. Wow. Crazy. Yeah. Back on in business when you do anything for appearances.

You can write that down under the dumb column. We don't do stuff for we do things to get return on investment in business.

And trying to appear to be something is never a return on investment.

Just be the thing. And then people will figure out that you is the thing. Yeah, like if you're basing all your success on the car that you put in social media, TikToks or Instagrams. But you don't have to spend cash on that.

I'd go rent a car like that. Did that's where you start rationalizing the number of music artists.

They rent a jet for the day to do their video.

And it never leaves the ground.

It's exactly right. They had a jet. Such an illusion.

“So play the game and that's a fraction of the cost.”

Yeah. Julie is in Houston. Hey, Julie. What's up? Hey.

We're big fans. Thanks so much for taking my call today. Thank you. How can I help? Well, okay.

I have a question about a specific long-term care option. And this is, so it's an indexed universal life insurance policy. No, it sucks. And along. Okay.

So here's the back story is. So my Hudson and I are nearly 60. We're pretty healthy. We're still. I'm still working.

It's been somehow retired. What's your next day? College.

“We have about 2 million in mutual funds.”

Yeah. No debt. Whoever should sell this to you stay away from them. Okay. So we're getting a little money from an inheritance.

About $100,000. So that's what our question is. For 50 for $250,000 premiums. We could buy this thing. You know, which, of course, if we do get sick as six years of a really good payout,

or we could just put it in with the rest of the... Putting it in with the rest of your investments.

If I had $3 million, let me tell you, I'm 65.

Okay. Net worth of hundreds of millions. I have zero long-term care insurance. I want to buy long-term care insurance for people that have a million dollar or less net worth by long-term care insurance.

Because a nursing home stay is a hundred and a quarter a year right now. And the average time is 2.9 years. Yep. So you've got a $300,000 exposure. So what you got?

On average. You can self-insure that with $2 million. Yeah. Okay. Okay.

Just to self-insure it. I would not... I would just... If he has to go the nursing home. And by the way, he will before you on average. 75% of the ladies out live their husbands.

That's the average. That's the average. That's the average. You'll be a beast in a nursing home, so hopefully you will. Yeah.

No. Or maybe it's long enough that the 2 million is 10 million. And you just hire somebody to live at the house and take care of it. Yeah. Okay.

That's kind of what we're wondering. I mean, you sound good. It doesn't, it isn't good. It's a piece of crap. It's whole life life insurance that you're pre-paying up front.

And then the supposedly the cash value will cover your long-term care insurance. She'd been much better off to just invest the money and let the interest off the money by your own long-term care insurance. But even better yet in your situation, you guys can self-insure it through it. Yeah.

Okay. But long-term care insurance is excellent. If you're over 60 and you're net worths under a million million and a half. Oh, interesting. Okay.

Okay. But that's...

But never, never, never, never use life insurance.

As an investment. 100% of the time those policies suck. And this one sucks particularly bad.

“Index universal life is one of the worst products on the market today.”

And it's only sold by those goobers and sell it. Everyone else in the financial world looks at it and the laughs at these morons. Like they are the paid aid lender of the middle class. So, again, if this is your financial planner pitch in this, you need a new financial planner.

I don't know who's pitching this to you. Or if Charlie over at the church, then you just need a distance Charlie to a no business with Charlie at the church. It's just what the crappy sweat pedals is. Hope I wouldn't unclear.

Speak careful at Charlie. He's not all smiles and handshacks folks. By the way, my favorite line of that is he would be a real pair of the nursing home. She knows I got to get a nurse for my husband. He would terrorize a large...

nurse ratchet. Welcome back to the Ramsey show in the Fair Wins Credit Union studio. I'm Dave Ramsey, your host, Kim Coleman Ramsey personality. And number one bestselling author is my co-host today. Naomi is with a single Los Angeles.

Hi, Naomi. How are you? I'm Pete. How are you doing, sir? Better than I deserve. What's up? Well, I'm pretty sure I want to thank you for taking my call. I have a hundred and twelve thousand dollars in debt.

The student loan's right now are deferred.

I currently have... I totally have actually three jobs, two jobs. I've been thinking about 90K here. And then I have another job which I'm a waitress and I make about 12,000 a year in the cash pay. Okay, so that's like a hundred and two thousand is your income.

“And you had a hundred and twelve thousand dollars in debt, agreed?”

Yes. Okay, how old are you? I'm 40. Okay, are you single? I'm single mother, yes, of two.

How old are your babies? One of them is 18 and the other one is seven. Okay, all right. 18 year old adding some income to this equation? Uh, he's starting to.

When? Um, he has a pretend job and he's speaking a full time job. Yeah.

Time to be a man, my son.

Yes. Yeah, because his princess warrior single mom mother has helped him get all the way to 18. And now he needs to not be a burden but instead be a blessing. Okay, that's one thing. Okay, cool.

All right, so it sounds to me like that you've been raising two kids on your own in the Los Angeles market. And this is a very tough road and you work your tail end off and you feel stuck. Yeah, that's correct. Yeah, currently have. I'm going to, by Friday, I'm going to have $9,000 in cash. Um, which I'm trying to pay a credit card off. And I have my emergency fund of $1,000 in your own wallet in your money.

You're a, why is it in your own? Yes. Um, I was stationed in the, um, in Europe. And so I bought back some money that I had myself. You were in the military.

Yes, I am. Oh, you are now. Yes. Okay. Thank you for your service. Okay. I would convert the euros to dollars immediately.

We're not, we're not playing foreign currency. We're just trying to have $1,000. Okay. That's correct. And then the nine, then I'm going to list all of your debts.

Smallest to largest and I take it your credit cards are probably your smallest debts. Correct. That is correct. Yeah, so list them smallest to largest. We're going to pay minimum payments on everything.

Cut up the credit cards and get in a tax mode. How much do you owe on the car? On the car, I owe $30,000. That's a lot. Okay.

“And the student loans are they on hardship deferral?”

Uh, they're on defer, um, good. Uh, and they are $30,000. That's where they need to be right now. Okay. So that's 60 of your 112 is those two things.

And then you got a personal loan. What is that? Just at the bank or credit union or to an individual? It was through a credit union. Okay.

All right. Ouch. And how much is it? That one is 20. Okay.

All right.

So here's what I would do if I were in your shoes.

It sounds like you've kind of got this on the run a little bit. Yeah. And number one, 18 year old starts bringing some money to the table. And at least carries his own weight. No pun intended.

Okay. Number two. Um, we're going to list our debts. Smallest to largest and attack them in that order after we've converted the 1,000 euros into 1,000 Dollars.

Okay. And that's probably going to give you a little, a little extra to throw on the other things. So we're going to list the debts. Smallest to largest attack them in that order. We're going to get on an every dollar budget.

Every dollar needs to behave. What you have tried to do and have successfully somewhat successfully done is survive. And while you were surviving, you just thought I can work hard enough and be real careful and everything will work out. And it didn't.

You work hard. You work like a crazy person. You're a hero. You took care of your kids. You're amazing.

I'm so proud of you. So are you getting child support on the 7-year-old? No. Why? He looks about, almost, almost, about 150 to 150,000.

Is he crazy? Really? Why? I don't know.

“Well, I think you should be dropped by the jag office and say gentlemen, I need some help.”

I think jag will help him pay. They're really good at it, by the way. Okay. Like tomorrow.

Yeah. Give all of his information. Say 7 years.

“He's never paid a dime in child support.”

And, you know, that's what jags for. They're for you. They're going to help you out. They'll take care of this.

It'll be amazing how efficient they are at it.

Because in the military, they do it all the time. So you guys, you know, take care of you. And you should be taking care of. All right. So that'll help too.

And I want you on that every dollar budget because I want every dollar to behave. I want you to pretend like I hired you and I'm paying you a hundred thousand dollars a year. And your job is to get these bills paid. And you would be very detailed if I told you that, right? That is correct.

Yeah. And so I'm going to give you every dollar and get you signed up for it. Because it's going to guide you on what to do. And it's going to help you lay out every dollar has an assignment for the whole month. And I just want to commend you.

Ken, I mean, to fight what she has fought for all these years. You know, as a single mom working her way through this, it gets lonely and you get tired. Yeah. Well, you got three jobs.

And that didn't even count the waitress in job. So you get three and a half. So you're not going to be stopped if you've got a plan.

“But two things, I want to circle back to you need to take this deadbeat to the law”

and make his life so miserable. He starts coughing up money. Don't get weary on that. Take that warrior mindset to that. The second thing is, if you have any equity in that car,

do you have any equity at all in the car or you upside down? I should have equity. How much? It's a Toyota. I don't know.

All right.

Here's what I want you to do.

Okay. Look it up because that $9,000. If you've got some equity, pay that car off. I mean, sell the car rather. Excuse me.

Sell the car. Take what's left over that $9,000 and get yourself a functional car. Because that car payment of yours is pretty big. I'm guessing. What's your monthly car payment?

740. Yeah, ma'am. That's a 85. That's $9,000 raised essentially. Sell the car and use that cash to get a functional car.

There's a pay-end on the credit cards. I agree with Ken. I just want to get you some more breathing room quickly. So let's pretend that the $30,000 car is worth or the $30,000 debt is, and the car is worth 35.

If you can sell it, get that five in your hand plus just nine. And buy you a $15,000 paid for car. That's a nice car. Yeah. And now you've got no car payments.

Zoom, zoom. We just kicked this thing into high gear. Yeah. And because that car is 750 bucks, choose. Wow.

Yeah, that's good catch, Ken. I walked right by that, I missed it. [MUSIC] When people hear my story of paying off debt, they say things like, "Dang, that must have been so hard.

I can never do that." And I tell them, sure you can. It's a short-term sacrifice for a long-term gain. But do you know what's really hard?

Working your whole life and never having anything to show for it.

Never having the long-term gain. Just feeling broke, stressed, and maxed all the time. And sadly, that's the hard that most people choose. Listen, you're capable of transforming your situation and living a life of freedom.

But you need the right tools to do it. Like our every dollar budget app. In minutes, it'll build you a step-by-step plan that's tailored to your money situation. And every day, it finds ways you can free up extra money

in your budget so you can get rid of your debt and actually build wealth. So make the choice today. Short-term sacrifice, long-term gain. Choose the tool to help you get it done fast.

Download the every dollar app and start for free today. One of the best things you can do for your finances is to have a really good tax pro in your corner that you can trust. They'll help advise you on the best moves to make your situation

for your small business or whatever.

“You have to save some big money on taxes.”

And if you've had big life changes in the past year, you need to think about that as well. A divorce, a death, a new big job, something big happened, good or negative. You need to tax pro in your corner,

and especially running something complicated or a small business. RamseySolutions.com/taxpro

and a Ramsey trusted. David is in Mobile, Alabama. Hi, David, how are you?

“Hey, David, can't thank so much for taking my call.”

Sure, what's up?

Well, first of all, 15 years ago,

I was in a bad place, lots of debt, or than I cared to admit, but thanks to you and your team over the past 15 years, my wife and I are now in Baby Step 7. I've been on the debt free stage.

I've been on the cruise, been to your place, and we're babysitting me in there. Why don't you tell us how you guys have done. But for you, man. All the way along the way,

we've raised our kids to be Ramsey kids, I guess. And so my oldest son, he's been married now for about a year. He and his mal-law have been through the hospital curriculum. They went through financial peace university during their marriage counseling.

No debt, cash flowed college, vehicles, everything, no debt. And they've just gotten approved for their first mortgage to buy home, a very reasonable house, and they've got $30,000 to put down,

and the mortgage lender kind of threw us a curve

all the other day, and she told them if they would take $5,000 and put it in a count, and use that to secure a $5,000 note, and pay it for six months

that would give them some credit,

“and potentially lower their rate by up to 1%.”

And here's our bank. You're being overcharged. Okay. If you go to Churchill mortgage, and they do manual underwriting,

there will not be a difference in the rate. Okay. We'll actually waiting on Churchill's proposal to come back now. Yeah. They can do manual underwriting, no credit required.

You're saying the kid has absolutely no credit at all. Zero credit. Perfect. Yeah. Okay. So is he had a job?

He does. Yeah. They both have a job per year now, both have good jobs. They choose a school teacher. He's an engineer.

They've been paying rent during that time. They have. And they have $30,000 to put down. Yes. There's no rate difference whatsoever.

Great. So the mortgage lender that you have is incorrect for whatever reason. I'm going to be gentle. Okay.

Yeah. All right. Well, that's good. He likes it. She has applied at Churchill.

And she's she's waiting on that. That information to come back. But that kind of threw me a curveball. And I heard that. Yeah.

Hang on. I'll have Christian pick up. And we'll make sure our team holds their hand and connects them into Churchill. Because I don't want them to do this or the deal. I want them to get a good manual underwriting mortgage loan.

We do it all the time. And have the decades with no credit at all. There is no interest rate difference. And so this lady at a minimum is not just does not know how to do it. And so you need to get away from her.

It's that simple. So Ken, George Campbell. Yeah.

And Whitney bought their first house that way.

Totally. John Deloni bought his house that way. Lots of other people. Thousands and thousands and thousands of others. But a lot of mortgage companies don't know how to do it.

And I don't know what kind of hook or crook this lady's trying to pull here. But is that scary, right? They don't want to do it either. They don't want to screw with it. But yeah.

And so what manual underwriting is before. So I got my real estate license in 1978. Before there was a FICO score. The banks actually used to do an analysis of the individual in detail to figure out if they could pay the freaking bill.

It's called underwriting. And so they would send out. When I would write a contract in 1978 in 1982, they would mail out a VOD, a verification of deposit to the local bank. And the bank would verify that the $30,000 is in the bank.

They would mail out a VOE, snail mail. A verification of employment to their employer. And he was sent back. There's so much they make. It's how long they've been working here.

And they would mail out to any creditors at landlord and get a record on how they actually paid their rent. That's called underwriting alone. And you're doing an analysis of the person's life to see if the indications are that they can pay the bill. You have their income. You have their track record with their rent.

You have their down payment verified. You do all of those things.

“And that's how long it's used to be written.”

And then along comes FICO. And in FICO is like a monkey can make this loan. It's like they look at the number and go, you've got the loaner. You don't have the loan, right? And so it's done.

The mortgage business has been dumb down to where people like this lady is telling this got to go get a stinking. Secured loan with her company. So she can create a credit score.

That's not the loan.

It's exactly what has happened here.

And so it's just dumb.

“But this is the ridiculous thing of FICO.”

And so FICO has got way too much power. It's not that accurate to start with. And so but Churchill mortgage and a few other mortgage companies know actually know how to do manual underwriting. Which doesn't matter if you don't have a FICO score. This kid does not have a FICO score because you can't have a FICO score if you don't borrow money.

See, only way you can get a FICO score. FICO score measures how much money you borrowed, how you paid it back, what type of money you borrowed and how quickly and all that kind of stuff. It's all it's an I love debt score. So if you don't love debt and you haven't borrowed any money and you don't have any open accounts for a year, your FICO score will just disappear. I haven't had one for 30 something years.

And so apparently I'm not here, I'm not real, I'm a hologram because I don't have a FICO score.

What? Yeah, look at me. I'll be my cash for stuff. It's crazy.

“And so that that's, you go to a mortgage company like a Churchill mortgage that can do manual underwriting.”

If you have no credit, zero credit. Now if you got bad credit, that's a different problem. Like you haven't paid your bills on time for two months or two years. You've got a different issue than it. But zero credit is a wonderful place to be and you get the exact same rate as someone with the stupid enough to have an 800 FICO score, which means you paid the bank sometime or another 100 grand in interest.

Because you've been paying and paying and paying and paying and paying, playing their game, playing a I love debt score game. Ding, ding, ding, ding, ding, ding. And that's what people get into.

So this kid is second generation and doesn't have a FICO score.

That's so cool. It's cool. Well, I mean, again, dad starts paying attention to the Ramsey ways. And if you're placed up in that 15 years. Some of that.

He's a millionaire. He's a millionaire. So the sun gets it. But to see this is the whole thing that you mentioned the word game. It is a game.

These banks. They understand what they're doing. They need you paying interest. That's where they make their money. So it's a game.

So we're going to create this system that everybody needs to play ball by. Diana's in San Francisco. Hi, Diana. How are you? Oh, I'm doing great.

Thank you for taking my call. I think you guys are terrific. Thank you. How can we help today? I'm 79 years old.

I have no debt except for my house. I owe 125,000 at less than 3%. I have $96,000. I've heard you speak of stock market and neutral funds. And I understand the four ways you put in.

I'm wanting to know actually if I can do something like that with with with what little I have. But my initial question is gold. Gold silver and you have coin, you have solid, you have paper. How are you feeling about gold silver? I buy my investments.

Diana based on track record and the track record on gold over the last 50 years. As it's earned about 3% a year average. Meanwhile, it takes you on a roller coaster ride that makes you want to throw up. But the average is out about 3% so I don't know any gold except some cuff links. That's the only gold I've got or silver.

And so I think I'd probably sit right where you are.

“If you want to move a little bit of that into some mutual funds you could.”

But be very calm and very careful and learn a lot about it before you do it. Hey guys, I've got big news. The Ramsey Show is going on tour and this is your chance to be more than just a listener. You get to be part of the show. So here questions, ask live and experience the kind of momentum that only comes from being in the room.

We'll be in Charlotte, Denver, Phoenix and Anaheim with a limited number of seats in each city. So last fall we completely sold out in 72 hours. So do not wait, get your tickets at RamseySolutions.com/events or by clicking the link in the show notes.

Chris Brown is a pastor, author, speaker, radio personality, church leadership expert. He planted a church here in Columbia, Tennessee, just south of here just a few years back. I spoke over there yesterday thousands of people coming out.

It's an incredible young church exploding.

It's kind of like Ken's going to a youth conference. I mean, it's a lot of fun. The praise and worship is a blast. It's a lot of fun. Anything but boring. And Chris and Holly have been friends of ours for 20 years. Chris was on our speaking team here for a while. So me and Ken and Chris are shared the stage many, many times and shared airplane seats for that matter. A lot of hours flying around all of the place and working together.

But the book is restored, transforming the sting of your past into purpose for today. And Chris Ken and I, of course, know your story. We've heard you tell the story many times from stage and heard you walk through.

“What God has done in your life, but was there a specific event in your life that made you want to tell this story now?”

Actually, it was a story from being around his solutions. It was a story of my first time ever spoke at Catalyst that conference back in 2015. I was probably my first big event and we had a time where we got in a board room and we dissected the talk in front of the board. And it was super, I was super stressed out about it. And we dissected it and I was talking a little bit about my past, but I was not peeling off the layers and I was not vulnerable.

And someone spoke up in the room. I don't want to mention anybody, but his initials are DR.

He spoke up and he said, hey, Chris, people are going to see you on that stage and they're going to perceive something like a silver spoon kind of guy who's always had it right.

And you need to be more vulnerable. And I was scared to kind of pick that scab of a traumatic childhood and some really bad things that have happened in my life. And it was that moment I realized that I need to be more vulnerable and more honest about my past and to steward it. Of course, we are all like big huge fans of stewardship and love to raise the banner of stewardship all over the place. But one thing that we need to steward all of us and those of you listening in is we need to steward our past and steward what's happened in our past.

So that we can have purpose today with that with that pain. Yeah, you know, you know our audience well, Chris, you know some of the emotions, you know the stories all too well. And inevitably, there are a lot of people right now watching and listening to you and they're in some deep pain, you know, maybe some relationship stuff that is causing to make financial decisions that are causing more pain.

Whatever it is to the person who is in the middle of it feels almost like it's unbearable.

What would you say to them? Yeah, and actually a lot of the book, I kept this audience in mind because being on this show, as it would call after call of mistakes, of shame, of regret, of guilt, of money mistakes, relational mistakes. I would say the goal is that we would take our pain and it would turn into somebody else's hope. I want someone to read this story and read the things that have happened in my life. It's the same thing with you, your bankruptcy.

What happened when you came out of the bankruptcy and it gives people hope of, you know, what if he can get out of that hole, then I can get out of the hole that I'm in.

“And so I think probably 1312 says hope deferred makes the heart sick, but a longing fulfilled is a tree of life.”

And so the goal is to just like the mission statement here is to inject hope in the people's life. And if you're listening in today and you've made some mistakes, I love this line when you're speaking and you're said, who hears ever made a mistake in your life. Everyone goes, you know, raise their hand and you know what that makes you and you say 13, you know, we've all made mistakes with money. And so that would be my, my, my prayer is that everybody listening in would say, hey, yeah, I have made a mistake. I can own it, but I want to steward it and maximize it for future.

I want to inject hope into someone else's life. Well, and sometimes the mistake you made, and sometimes it was a mistake other people made. I mean, yeah, the trauma in your childhood is not your fault. Yeah, that, that's the situation around parents that were screwed up and family situation that was dysfunctional and all that kind of thing. And it leaves you without food or leaves you without shelter or it leaves you without comfort.

And that's not that you're a victim of that, but it's still something, it's still a part of your story and it still has value. Yeah, yeah. Well, you've met you use the word victim and of course you guys have all heard it before. We can have a victim's mentality or a victor's mentality.

“The sting is going to be there in your past regardless. So it's what are you going to do with it?”

Are you going to suck the nutrients out of it and make sure that you use it and maximize it and leverage it for me. I'm a believer. I'm a faithful person. So for me, it's leveraging it for the kingdom, leveraging it for eternal impact. But men, all of us who've made mistakes, those of you who've made mistakes of money, take what you've learned, the principles you've learned, and then help your neighbor help somebody in your class, help somebody in the workplace. And that that's what the whole book's about is to leverage whatever's happened in your path. You can't change it.

And that's what we're on this earth.

The book is restored and transforming the sting of your past into purpose for today. Chris Brown is our guest, local pastor, friend of ours, and a member of our team in the past and we've got to work together all these years. So one of the things that people ask all the time since we're people of faith and they ask you the same thing as a pastor, I'm sure is, okay, if I'm in the middle of this stink,

“maybe I caused some of it, maybe some of it was brought on me by other people, either way I'm in the stink. Where's God in the stink?”

Yeah, you know, the world, the Bible says, and I believe it's a Matthew chapter seven, I believe it just says, there will be troubles in this world. But Jesus says, but I have come, take heart, I have overcome the world. And so we do have to know that there is evil, there is darkness in this world, so things are going to happen to you. And we have a, we have a responsibility to be the light in the darkness. Have you heard it before a thermostat or a thermometer?

We are to bring the light and we are to stay close to Jesus. Whatever you, whatever you're struggling with today and you just need to know that Jesus is right there with you.

That's been huge for me, to know that my hope is not just in wishful thinking, but my hope is rooted in the promises of Christ. A hopeful expectation of a better tomorrow based on the promises and the character of Jesus. It's just a big difference between that and hopeful thinking. You know, I've run into so many people that verify the same experience I had 30 something years ago at the darkest moments. Like, I see absolutely no way out and I have this strange piece anyway.

Yeah. It's like, this does not even make sense that I'm Pete, that I have less anxiety and I have no idea how I'm going to get out of this. Yeah. And what it's going to look like. But here I said at the bottom with a baby and a marriage hanging on by a thread bankrupt and I have no idea what all this is going to happen. But of course, but I remember distinctly sitting there having this piece that passes understand yes.

Yes.

“And it's strange and I think that's God just showing up and going, you're going to be okay.”

And even if your brain doesn't tell you that, it just soaks through the rest of your body and the rest of your body goes for some reason. I think I'm going to be okay. Yeah. Yeah.

Chris, I know you're right about this in the book and your story is very powerful, very excited about our audience.

Checking this out. But one of the things that we humans have to face in the process of healing is dealing with shame. Yeah. Shame is such a powerful emotion even years later. How did you unlearn shame if I could word it that way or what would be your response be to someone who's just kind of wallowing in some shame? Yeah.

“I think shame is just I think it's a gap between your expectations and what exos reality.”

So I think for all of us, we just need to understand that we are going to make mistakes. So when you make one, you're not shocked. It's just, it's not if you're going to make a mistake. It's when and how big is it going to be because we are fallen humans. Romans 3 23 says that that all of us have fallen short of the glory of God. And so for me, that's that fell off me when I'm like, don't be surprised when you make a mistake.

Also, the fact that we learn from our mistakes and that really helps us in the future and it builds our character. So that's that fell off of me really, really fast that way. Any time that you're helping other people, it helps reduce the shame because now you've leveraged something out of it. The Bible says in Proverbs 11 25, those who refresh others themselves are refreshed. And so for me, I've used even my bankruptcy that happened in the recession in 2007, 2008.

I've used that to take the local principles that I've learned from Dave and learned from Ramsey Solutions. And I've tried to like just maximize everything I learned and I've clawed and clawed out of bankruptcy to be successful with money again and try to restore that shame. So the refreshment now just trumps the shame. It's good. Pastor Chris Brown, we're proud of you.

Thank you. We love you. Glad you're glad you stopped by again today. You're welcome anytime. The book is restored, transforming the sting of your past into purpose for today. Be sure you check it out.

Thank you. [Music] Hey guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey.

Whether you're making a decision or just want something explained, Ask Ramsey is here to help.

It's fast, simple and free to use.

“Go to RamseySolutions.com and try Ask Ramsey today.”

That's RamseySolutions.com. Our Scripture today, Proverbs 16/8, better is a little with righteousness than great revenues with injustice. Albert Einstein said, "Try not to be a man of success, but rather try to become a man of value." Ooh, there you go. Felicia's in Chicago. High Felicia, how are you?

I am so well, Dave. It is a beautiful day and I'm on this side of the grass, so I am praising the work. I love it. How can we help? Alrighty, so I am a 23 year old blue collar homeowner from the Midwest. I'm in a pretty, I'll say uniquely blessed financial situation that I can't really find many resources.

I'm just how to navigate. So from age 18 to now, really, I guess I made a lot of really dumb financial decisions. I wrapped up about $15,000 in credit card debt. I bought a brand new car in 2021, got under water and payments. I even took out a debt consolidation load from those credit cards.

You did all the stuff. I did all the stuff, yeah. You know, they say you make up for the mistakes you make in your early 20s and your later 20s. I'm doing it now. But I kept using the cards on top of paying my mortgage.

And at worst, I was over, I want to say, just over $25,000 in consumer. So in November 2025, my mom passed away from cancer and left my sisters and the beneficiaries of her life insurance policy. And I used that money to completely wipe out all of my debt. So, um, including your house. I know.

I still have my mortgage. I'm sorry. Okay. Everything. Sure.

Your debt free except the mortgage. And you make what a year. Yes. I make just about a little over 80,000 a year. Good for you.

Okay. Your questions. Thank you. Um, so I, I guess my question is that just how, how should someone who just escaped

“gets, um, managed money responsibly when they've never had a savings before?”

Um, I just saved my first $2,000. And I, I kind of feel like a little kid and your mom just gave you a $10 bill, you know? Yeah. Um, it's like that. So, first and foremost, I like, uh, I would use the story that is your life as my motivation.

Okay. In other words, if I misbehaved with money again, that is bringing shame to the legacy that my mom left me. Sure. I don't want to disappoint her if I'm you. Right.

I never thought of it like that.

That is a fantastic way to look at that. So, when you look at it and say, I've got to do this because mom got me cleaned up this time. There's not going to be another one of those. If I screw up again, and so I'm going to, I need to honor that memory, a cherish that gift. And the way to say thank you for it is to be a grown-up going forward.

Now, then once we say that, we say, okay, how do we do anything well? Well, it starts with a plan.

“I mean, if you want to get in the car and leave Chicago and you say, I want to go to Florida,”

you don't just start driving. You actually load a map. Call on your GPS.

And it starts to give you a step by step first when you leave Chicago.

You're going to go to rockford and then you're going to or whatever. And then you're going to go to and then you're going to go to and then you're going to go to. And if you keep doing and then you're going to go to, you look up and you're in Florida. And so, if the Florida is wealth, what are the steps? What's the, what's the map look like to wealth from where you are?

And, you know, and so we're going to lay out a game plan that's a budget. And we're going to give you every dollar and give you a trial run on it where you start, where you take this app and you download it and you take your income.

Okay. It's your job now to be an adult, not a child and manage money responsibly for you incorporated.

And you have to report to your boss.

“You have to look and and turns out your boss happens to be in your mirror.”

Okay. So your job is to manage money for you because you make two stinkin much money. And you got this wonderful one time get out of jail free card and you can't screw this up. So I've got to make this money behave. As you said, I've got to be responsible and I love your attitude. I think you're awesome. And I think you're going to be able to do it.

I talk to some people sometimes when I can't tell they're going to do it or not. I think you're actually going to do it. Yeah. And listen, thank you so much. And listen, let's get gazell intense in the baby steps.

You know them well. So you are on your way to fulfilling baby step three, right? So what's the target? Is it three months expenses? Is it six months? What are you going to do? Yeah. Right down a number. Right down a number and just chunk in money and they're in come to get there. That's right. And then once you get done with that, now it's 15% of that income.

And we're going to start investing for your future. And at 23, you're going to be a multi millionaire.

If you say 15% of your income of the $80,000 income, you're going to have 10 to 20 million

dollars when you get to 65. Oh, that is so hopeful. Oh, my goodness. That's the gift your mother gave you if you're a grown-up. If you're a child, you'll be broken living on social insecurity. So choose well.

Yeah. I sure will. All that is fantastic. You got to get on proud of you. You can do this. So lay out a written game plan and then use the money that you find in the budget to walk right up those baby steps.

This can't indicate it. That is perfect for you. And we're going to do it all in mom's memory. All to honor the free get out of jail free card. This should give me.

And I get I get I get a clean slate. I get grace. I get the chance to start over. I get to do over.

Remember playing football in the backyard?

You get to do over. Oh, I love do over. You know, that's what this is. She got to do over. She gets another shot.

That's so cool. Ben is in Austin, Texas. Hey, Ben, what's up? Doing good. How are you, gentlemen?

Better than we deserve. What's up? All right. I am. Things are going off.

“I mean, actually, for years ago, I think that we're going to disappear.”

Come across. You're feet. To help me out at one point, a friend. Give me a room for $26,000. Good.

The backup. The area. It's. This is the most expensive thing in my life. That was originally backed up against my 401(k)

And he said, look, you know, what you. Is. Come March. Go ahead. And if you need to do that.

Contributed with cash positive unless. Under legal stuff comes up and then all the positives that I was. Go to the window. So here's my question. Cash.

Cash all four. One, K and P and that off. Or other finding some personal loans. We give them that upgraded so far. So these are the things that will end up cost in the next.

To $5,000 over the chart. So the cash on my phone. What do you make? One grand. 110.

Are you past the divorce now? No, sir. We're still on the sick. Okay. So how you going to cover the future legal phase?

That's that's part of the issue. I am currently. So this got loaned you. $26,000. And he wants it back before the drama is over.

You know, when he wanted. He was. The deal was. You would have a back by March. Yes, sir.

And I do think you were going to have $26,000 by March.

“You know, honestly, sir, at the beginning of a deal.”

Well, a couple of things. One, I thought it would be not positive enough to pay off most of it. Never positive on what? Well, so, sir, typically I'm making a net positive $2,000 a month. Oh, you talking about your income.

You were going to make enough income to pay back by March. When did he make the loan? Yes, sir. September last year. Well, honey, I'm going to make $26,000 from September to March at $2,000 a month.

Absolutely. So initially, the plan was. I wasn't going to be able to pay off the 426 by then. But I was going to pay off a lot of. So, and to be honest, sir, I, I was, I need to pay the lawyer.

And that was, that was the lawyer. So how are you going to pay the next lawyer? Uh, not yet.

All right.

“So I would borrow money to keep from catching out your 401K because it's less interest to pay your friend off.”

And you guys got to slow down and do a little math here before you do these deals, son.

I put this hour of the Ramsey Show in the books.

We'll be back with you before you know it.

“And the meantime, remember, there's ultimately only one way to financial piece.”

And that's to walk daily with the Prince of Peace, Christ Jesus.