Building Wealth Is Simple (But Not Easy)

Normal is broken common senses weird, so we're here to help you transform your life.

“From the Ramsey Network and the Fair Wins Credit Union Studios, this is the Ramsey Show.”

So crew's number one best selling author, Ramsey Personality, co-host to the smart money happy hour. My daughter is my co-host today. Open phones at triple eight, eight, two, five, five, two, two, five. Thanks for joining us, everybody.

Steve is with us, and Cleveland. Hi, Steve. How are you? I'm doing well. How are you?

Better than I deserve. What's up? Hey, yes, I took out some loans for my business last year. Totally in about 90,000, and I am unable to afford the payments now. Of course, I went through the slow season being that we are in the deck and carpentry business.

And so that was pre-taxing on funds. And so I'm looking to join a deck consolidation program here that will reduce my weekly payments $2,400 down to $1,200, I'd like to do that, but my wife asked me to call you, so here I am. Oh, man. What a motivation, Kelsey.

Yeah. So you borrowed $90,000 for what? I had the deck that I was looking to scale it. And you didn't? I had no going into the slow season here.

We did not. Well, I mean, you knew there was a slow season. And when you borrowed the $90,000, yes, that's correct. I intended to spend that money on marketing, doing some home shows, uping our marketing budgets through that time, bringing on a salesperson, just ramping up the sales and kind of

muscleing through the slow season with still bringing in revenue. But the weekly payments, we're just more than what we could handle, their sales didn't go in the same trajectory that I had planned on, and we did very poorly these last couple months in sales. Okay.

Well, there's a correlation between doing poorly in sales and the slow time, and the fact that you dumped $90,000 in stress on top of your own head. And that affects you running your business well. I've been there. I remember, and it's not a fun thing, so you're really feeling this pinch hard.

So what does your business make?

“What's your gross revenues on your business in a year?”

So we're going into year four now. That was around September here.

The first thing is, I hope, that you've learned your lesson, that borrowing money to expand

your business is a dumb idea. Yes. It's a dumb idea. I do not intend to do that again. Ever again.

Okay. So the next time you get ready to expand, use your profits to expand, and don't take as much home, or don't expand one or the two. Okay. Those are your two options.

Borrowing money. Very seldom works, especially in these scenarios, which you described here. So the magic sauce you thought was marketing, and some sales guy, when it turns out listening to your sales numbers, you were the magic sauce. You took a business from 250 to 450 in 12 months.

That's pretty freaking incredible.

And so that's your answer to get out of this debt. It's for you to take the business and kick it in a button, get it going. And if you hire more people to do more decks during the season, that's fine.

“The debt con solidation loan, I do not know, how did you borrow the $90,000?”

What kind of debt is it credit cards? No, they were micro advanced kind of loans. They were a short-term loan, as what it was. So they were short-term loan. Who do you owe the money interest was?

One is, and you want me to name the creditors on you?

Yeah. Okay. Yeah. We had micro advanced forward financing, and then we had what I thought was a debt consolidation loan for tele-capital.

Okay. It's good for America to hear these names, because if you hear these names, run. Yeah. Have you contacted a debt consolidation company already, Steve? Yeah.

There's one that I plan to work with called, it's a coastal debt consolidation. Okay. How far longer are you in the process? I haven't signed anything yet. Okay.

Good. I don't think it'll work. Okay. Because what debt consolidation companies do is they typically take credit card debt or consumer-based debt, not small business rip off debt, and don't pay the payments for a period of time,

destroying your credit, and then renegotiate based on the fact that the loans are in

“default and get a lower rate or a better payment rate, and that's the only way this”

is going to happen. They're going to put you into default. And so it's going to do to your credit, the same thing, a chapter 13 would do to your credit. A chapter 13 bankruptcy would do the exact same thing.

It'll let you renegotiate the debt payments and put them on a five-year plan and get it where you can breathe, but it's bankruptcy. And that consolidation, in this case, the way this is laid out, the way these loans are laid out is that way. I wouldn't do it.

Instead, what I would do is say, I'm going to look in the mirror and say, the secret

sauce to my business's rapid growth and success has always been me, not something I can

buy with $90,000, and I'm going to strap a tool belt on me and about six of the people, and I'm going to go build a whole bunch of decks, and I'm going to live on beans and rice, and I'm going to pay the whole thing off quickly, and get rid of it. Do you have any retained earnings in the business, Steve? Any cash?

I know hardly, not at this point, not after the months of making those payments. Yes. Yeah. When does season pick up for you? I'm assuming spring summer?

That's correct. Yeah. Okay. So we're almost there. I mean, it's March.

Yes. Here in the next six days. Okay, I'm going to start booking stuff left and right, taking deposits, and start slamming down money on this 90K and getting rid of it, and I want you to be rid of it in a year. I want you to work all the time, I want you to work so much about the collapse, and that

is your answer, because filing bankruptcy, or using a debt consolidation company, which, in this case, is going to look exactly like bankruptcy on your credit, and it does for most of you, by the way. You're going to, you know, worn out, tired, retired actors telling you to get debt consolidation

on some cable TV thing, and then you go do it, and basically they don't pay the payments

for about six months, you pay them, and then they start settling the debts, and or they start paying a payment plan on the debts, but by then you're into fault on almost everything. And so it trashes your credit. And if you're already at that point that you can't pay the payments, and you go and

“do fault, then you could be the ones to negotiate if you need to, especially with credit”

card companies. If you want to quit paying them, you could quit paying them, pick out one of the three and quit paying them, and let it go into default, and then save up a lump sum and settle with them. But these were horrible loans.

The whole thing, as you can tell, was a horrible idea, but the way out of it is you. I think you have a golden hammer, and not swing it. Statistics show that half of Americans don't have enough life insurance, or they don't have any at all. They don't understand this, John, why don't people want to take care of their family?

They think they're going to die or something? Well, I used to be one of those guys. I didn't even think about it, and one of my buddies said, "Hey, the only reason to not have life insurance is if you hate your wife and kids, and I immediately went and got term life insurance."

That's a good punch. Oh, you're telling me, and for decades, Dave, I've sat across people who've lost a spouse.

“They've lost somebody important to them, and they don't know what to do next.”

I mean, you're going to have a crisis here, and you've got two options while you're sitting in talking to a young widow. She's concerned about how she's going to invest all this money properly and not miss this up, or she's concerned how she's going to eat tomorrow. That's exactly the two options.

In terms of your dad-gum family, term life insurance can replace income, pay off debts, cover funeral expenses, so your family can actually have the opportunity to just be sad. Yeah. To just miss you.

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I know, it was great. Looks like we're on about an every two year rhythm to give you an idea, and so we love it to have you go. Just go to ramsysolutions.com/events or click the link in the show notes. Alright, a Kevin is in Austin, Texas.

Hi, Kevin, how are you? Good. How are you? Better than I deserve. What's up?

Hi, so I don't know if you can hear me clearly, right? I'm 30 years old, and I have made a few questionable investments that I spent most of my life saving up, and getting ahead, I saved $34,000 over college, and my early adulthood, and some sort of shorts, I ended up losing everything in penny stocks that someone I knew suggested me to, and now I'm back at my mom's house with my wife, and she's not too happy about it,

and I'm just trying to... Do you lose your house and everything? I was renting an apartment. Oh, I gotcha. How old are you?

You're not a job. I do, I do, I'm actually a manager at an in and out, and I don't know if you've ever been before, but uh, we just got one here. They just moved into the neighborhood, but the flying Dutchman's skirt. But office is across the street, but anyway, so the, uh, wait, mate, you were a manager

and in and out when all this was happening? No, so I actually worked at, uh, I had a full red scholarship, uh, college, and I worked at Wendy's and other, like, fast food joints, and I picked up a bunch of money, $34,000. Yes, but you were living on the $34,000 when you were doing all of this, you were living on your, you know, where you're not?

No, that was just my savings. Okay, my point is this, there's no reason that you're at your mothers if you didn't lose your job, you just lost your savings. Yeah, well, the thing is, I, uh, I have a bit of debt, I have a few different cars, and I, I don't have, uh, really enough money to afford, uh, any kind of, like, you know, anything

food related or going out to have fun and I kind of just figured, you know, the ultimate goal

“is to escape the lower class and what I've read online is that you need to take a little”

bit of risk, um, I think I went there only about that, but my goal is, I think you read about it in the wrong place. If you read about financial stuff on TikTok unless it's us, it sucks. So no, you didn't need to take a lot of risk.

So here's the thing, honey, you know, you have a debt problem, not a, I lost money and

penny stocks problem. If you weren't using your savings to live on, you were already had a life, and then plus your amount of savings is the penny stock thing. So we don't blame this on the penny stock, we blame this on the fact you bought a bunch of crap, like cars that you can't afford to pay on an, in and out manager salary.

>> Right. >> So the cars, it, I, I, I, I can definitely, I can, I can definitely sell, I can sell the cars for sure. >> Yeah.

“You should have, but before you move in with your mother, okay, um, and then what I just”

be remembering, uh, or do I get like a cheaper car?

>> Yeah. >> Yeah. >> Yeah.

>> But I have to get to work.

>> Yeah. But you get a two thousand cars.

“>> But you said, yeah, you said plural cars, how many cars do you have, Kevin?”

>> Uh, I have two cars. >> Okay. Do you, and they're both on payments? >> Yes. >> Okay.

How much do you owe them? >> Uh, one of them I owe about 30,000, the other one I owe about 20. >> Okay. That's a thousand dollars in car debt, and what is your income, sir? >> Uh, about 60 extra tax.

>> Okay. Does your wife work outside the home? >> Uh, no. Why does, um, uh, it's, it's complicated. I think that, uh, she, uh, I kind of, um, a big believer of the whole nuclear house, you know,

so she takes care of the house. >> Have you, you don't live in your mother's house if you're a believer in the nuclear house? >> Yeah. >> I think, I think my mentality was, um, that she didn't just help out.

>> Do you have kids, Kevin? >> Do you have to make that sacrifice? >> Kevin, you got, you guys got to work, how old are you all? >> I'm 30. I'm 30 years old.

>> Yeah, sure. >> We got to start working. We got to start working. >> Yeah, sure. >> I do not have children.

>> Okay. Look, both of you get a job, and both of you sell these dumb but crazy cars, and go get you a one bedroom apartment, get you two $5,000 cars, and then you have $10,000 in car debt, and instead of $50,000 in car debt. That is your problem.

>> And you do not penny stock. >> And then do that.

“>> That's what's causing you to be in the lower class living in your mother's basement.”

Not penny stocks. >> Okay. That, that, that definitely makes sense. >> You lost $50,000 on these cars, you lost $30,000 on the penny stocks. >> Yes, absolutely.

For, for reference, I had seen it work in the, I'm, I'm nothing, I can't miss it anymore. I, I did have a question as, some of the all-year experience, it's, I'm not investing in like the risk here, the penny stocks are call options, or anything like that. Do you have a investment, like recommendation for when you feel about that? >> Yes, it does.

>> Okay, so the, the number one wealth building tool that you have is your income. You have given that away to the car companies, and so in order to be able to be a real investor, and become wealthy, like the wealthy do it, you have to put your income into investments, and it's not speculative, and it's not high risk, and I put mine in basic, growth, stock, mutual funds.

Okay, I'm going to send you a copy of the book, the total money makeover, 20 million people have read this book, and it's helped them work the baby steps to get out of debt, because when you're out of debt, then you're freed up to start doing the term investing. How much do you guys pay in car payments each month? >> I think about, I think about, I think about $1200.

>> $1200, okay, so here's what's crazy, here's, here's the mindset, okay, instead of paying

the car companies, you pay yourself at $1200. From age 30, ready for this? From age 30 to where you are now to 67 years old, at a 12% rate of return, if you just put this in good growth, stock mutual funds, and did not risk it. Age yourself, these car payments, instead of the cars, you would have $9.8 million at $67.

“>> And that's not speculative, and it's not risky, so that's what basic people do in a 401k.”

>> Yes, and the lie, Kevin, that you're, that you have in the back of your head, so you do these penny stocks as a get rich, quick mentality. To build true wealth is actually very simple, you live on less than you make, you don't go borrow money, you pay yourself, so you are investing, you are saving, you have an emergency fund, so when something comes up, you're not running to debt, you have the money saved,

you invest, you're generous, so there's a plan, which, yeah, the book, TMM, I would tell money to make up, we'll help with that. >> So how send you that to try to help you, so the summation of the overall call is this, you're feeling 90% of your shame over the penny stocks, and 10% of it on the cars. I want you to flip that, I want 90% of your guilt or shame to be on the cars, so you'd

never do that again, because that's doing more damage to you than the penny stocks did,

and then the lesson you learned from the penny stocks is you, Abraham Lincoln said everything on the internet, it's not true, okay, so just, >> She read that on the internet. >> Yeah, I read that on the internet, so, I mean, this is, you know, so just got to know that most of the stuff on TikTok is a lie, most of the stuff is, >> And if you're too, can I just say this too, sorry, if you're too well, well-bodied adults, both of you

should be working. Especially if you don't have kids, right, and to get yourselves out of this mess, and to get yourself on a financial playing field that you actually then have stability, and then you can make choices of, hey, I want someone home, I don't, but right now, you guys don't have that luxury, that's a luxury to keep one space at home.

>> You're living like you're making $200,000 a year, and you're not, and so you're going to have to adjust your expectations on how this whole thing works.

Don't forget, guys, I started my company on a card table myself, so I know what it's

“like to have people counting on you, your team, your family, not to mention your customers.”

And when you're the one signing the paycheck, you can't afford to fly blind, but I'll be honest, early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team just fixed it, and they did. We got net sweet.

That was years ago, and we've never looked back.

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Can is, whether it's in Mobile, Alabama, how can, how are you? It's been a great day, very new. Better than I deserve, what's up? Hey, so I've got a quick question. What I've got your thoughts on trust, retired, a father-in-year plan that I actually learned

from my mother, but I've been listening to you for years in any works. Well, thank you, now I have a really good net worth, I have one child, and you just graduated from college, and I just want to make sure that, as my wife and I passed this on the helm, that it set up, you know, protective from lawsuits and others type things, and I've

“had friends say, well, you need to set up the trust, and I just want to get your thoughts”

on that. And what's your net worth?

About three and a half million, including my house.

Good for you. Okay. All right. We have our items, and my mainly in LLCs, and a few of them in trust, okay, particularly real estate.

Each of our real estate properties that has substantial value, we put it in the individual LLC, so that, at worst case, you would lose that piece of property then, okay, and if it was sued, okay, that's your worst case with that property. And so if you had a piece of property worth of million dollars, and you've got a $50 million lawsuit on it, you hand on the keys and you walk away, right?

All right. But that's your, but if they don't get everything else, and that's kind of your point, ultimately

the thing that protects you much, much more than that, is to teach your son, how to behave.

You started with nothing, and you've acquired enough wisdom to run all of this, so he could learn to do that unless he's, unless he's got a mental disability of some kind, does he? No, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no, no. Okay. If he's just irresponsible and immature, you can't do enough to protect him from that.

He's going to screw it up no matter what you do. Is he can? What's his status? No, no, he's not, but he's a very kind-hearted person, and, you know, his thoughts are more in the social work history side of the House versus my background with an accounting

and finance. Yeah. Well, I think, I think you can have some real frank discussions with him and say, in order

“for me to leave this in your care, you have to have a level of wisdom on how to handle”

it, because that's your job as the steward of this, because this is God's property, and I'm managing it for God. Now, you're going to be managing it for him later, and you're going to have to do that with wisdom. I mean, really, that's going to be 90% of your safeguard.

10% is your structure. Okay. So, it kind of falls in the heading. You probably have heard this before. I'll teach you, Entry.

I teach small business people, there's all the time in contract law. There is no contract in the world that is strong enough to keep you from getting screwed by somebody who's a crook. They're going to find a way. Okay.

And you can't just say, "Oh, but I had a contract. You know, and no," I mean, he gave it all away. He screwed up, and he was kindhearted, and he got exploited, and he got scond, because he had a lack of wisdom. That's going to happen with the other trust or whether you have LLCs or no matter how

you structure your risk management process.

in someone else's control, called a trustee, and he's not allowed to do anything or make any decisions, and that's just not a very good life for him. Yeah. Right. I've heard people mention that before, but yeah, I just don't go, I agree with you.

That's not a good life for him or, and it doesn't give many responsibilities. Yeah. Yeah. And how old is he now? 20.

Okay.

So, set down with hours when they were about that age, and that's the first time they

understood that we had built a net worth from having gone broke. And we said, look, first thing is, you know, we're Christians, and so, as for me in my house, we serve the Lord, this is not yours. It's not mine. I'm managing it for God.

And if you don't leave this conversation with a sense of responsibility and heaviness, instead of who I hit the lottery when you start to see what our net worth is that someday is going to be yours, then I didn't do my job as your parent to this point, and I didn't do my job in this conversation. And we had that conversation very clearly.

And to their credit, they all accepted it as a responsibility, as a privilege, to get to manage this wealth for the good of the family and the people in the community. And one of the best elements of that is learning to manage just our life. We're not managing any of that right now, right? And it's a learning to live within our own means of the jobs that, you know, we've chosen

to take on that. I don't get any of that while I'm gone. So, yeah, there's a level of him that's going to be managing his life after college. And you get to kind of be there with him in those conversations.

“And that's kind of his practice run, honestly, Ken, before he gets handed all of this that”

you've built. No, no. No, the answer to your overall question is I would not put it all in a trust because I don't think it's going to accomplish exactly what you're trying to accomplish for the reasons I said.

Now, is a trust for part of it, possibly a good place? Yeah, probably, just from general risk management. And it depends on how your wealth is structured and maybe some LLCs and so forth. That's true. Because I'm a very poor man right now.

I own absolutely nothing, even my cars are not in my name. I don't have anything in my name anymore. It's all in the name of something else and my wife is in charge of all that. So if she leaves, I'm going with her because she's got all the kids. So, you know, I mean, that's, you know, it's just you really can't get to, we've insulated

our stuff, you know, lawsuit happy world. Give a high level of like, what a trust is, a living trust, all the different kinds of people that's structure. Because we get this question a lot about wills, should I, you know, I mean, everything from that too.

Well, a lot of times people want to do a trust for different reasons than Ken, okay? They want to do a trust to avoid probate. And probate is the tax that your state has. Our state has a 3% probate. It's not much.

So it's not that big a deal. And you do avoid probate by putting the stuff into a trust.

“But you have to move the title of everything into a trust.”

That's a living trust. Mm-hmm. Okay. And so, you move everything into the name of a trust and you manage everything out of a trust.

And you do that if you got a $2 million network.

So you don't pay, you know, 40,000 bucks in taxes, which is just dumb. Because of the effort. It's too much effort. And most people don't, they don't ever fund the trust. I mean, they don't ever move the title to their house into it.

And I'll move the title there. I'll open the trust. If you have to put all the redo all the titles to everything in the name of the trust. And if you don't do that, the trust is simply empty, it doesn't have any in it.

And so you paid 5,000 bucks to some lawyer that talked to you in a doing this for nothing. So get a will is what you need to do. Yes. And then at death, you can form a trust. Or if you're doing like a massive piece of property or something, like we've got a couple

pieces of property, there are hundreds of millions. Well, there was a guy he called in last week. And it was a Southern California property that his grandfather left them. And it was like a 10 million or something, it was millions and millions and millions and millions of dollars.

And that was in a trust. Okay. And that's fine.

“And if you want to do that, that's fine.”

But the problem is it's the stuff that we have in a trust in the Ramses.

It's trapped. You guys aren't going to be able to sell it. So the things that we're not sure you're going to want after I'm gone, we've left that in just LLC, because y'all made deal some of that stuff. But there's like this property is in a trust where our offices are the campus because

that you can't sell that. You've got to run the office out of it, so run the Ramses out of it. But there's a few things like that. But the rest of them, you just don't want to handcuff people from the grave in an effort to force them to do serious stuff.

So teach them while you're alive, what you want them to be. And that's your fix for most things. And if you're trying to manage risk and while you're alive, moving some stuff, we don't put more than about $5 million or a single piece of property depending on the size of what's going on into an LLC.

And so like we've got enough houses in an LLC, gets to $5 million and then we quit.

We don't have them in the middle of the week, but we would not let the LLCs get too big, because they don't have to be a target on them then. But that's not a death after death thing. That's a while your alive risk management, right? Yeah.

But as far as after death goes, a trust is freaking forever, unless you put a termination date on it, or a methodology for terminating it is part of the term for the deal. So most people don't think that through when they do this. I would go to the source and fix the source first, which is craning up your boy and then go from there.

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That's BetterHelp, HELP.com/Ramsie. Melinda is in Phoenix, hi, Melinda, how are you? Hi, how are you doing, can you hear me okay? Absolutely. What's up?

Oh, awesome. Yay. Thank you so much.

I just love what you do, and we just started the financial peace university like two weeks

ago. It's very cool. Well, welcome. We're glad you're here. How shall we help you on your journey?

“Well, I'm hoping you can help put out a fire with me and my husband because we've been”

going back and forth of this. We love to settle a debate, Melinda. We are here for it. Oh, that'll be great. So we are going through the steps.

He is on baby step number one, which is putting a thousand dollars in his starter fund. I already have baby step number one covered. I have about $6,000 in my personal savings. However, we have a joint savings account that has $2,500 in it. Now, I have asked my husband to not touch our joint savings because it just gives me like

a little bit of peace of mind of being able to cover like one month's mortgage and some bills if something happened. He has said, "Well, wait a minute, Melinda, if we just take our joint savings and we reach 50/50, put into it, you take 12/50, I take 12/50, then I have baby step number one, box check, and then I can go on to pay my debt off.

He has a lot more debt than I do. I don't have that much, but he has a bit more, so if you kind of eager to start paying it off and I'm pushing back on him saying, no, I want to keep our joint savings, pretend that's not there, and you figure baby step number one out." OK.

And he said, "Why don't you ask me, Melinda, in 30, almost 40 years of doing this, the couples that do it, the way you're trying to do it, fail." Oh, he said, "Ask Dave, he's like, "Why don't you ask me, if we can touch our joint savings." So what, what, the couples that actually went on and go all the way to being millionaires

when we did an actual study of millionaires, we asked them the same thing, work 100%

And so I would take all the debts and put them in one list, all the savings and put it in one list.

“It's not your roommate, it's your husband, and that's what we've seen to be very, very”

successful. It has the added benefit of creating synergy and the other added benefit of creating massive amounts of communication and values alignment because you really have to force yourself to work together because everything's together, and then there's this unity that comes in the relationship that you didn't even see coming.

So consequently, what we end up hearing, and I first heard this, I don't know, decades ago,

I'd be teaching Financial University in a live setting, and people would say, "Oh, this saved our marriage." And I'm like, "What? Our made our marriage way better." And I'm like, "What?

Sex classes down the hall." I mean, come on, and they're like, "No, you forced us to work together and align our values and have one account and one list of debts and one life, and it forced us to create a unity in our relationship and a communication level in our relationship. So I didn't do it for that reason, I did it because it was practical, but I've learned

later now, in retrospect, all these years later, that it has all these added benefits to the marriage, as well as really increases the probability of you winning, right? Showing you get a lot of criticism when you tell people to join accounts. Yeah, some people hate that. They love having their separate thing, but that's it, Melinda.

I mean, there's a, there's a logistical piece to this, and then there's the actual benefit

to the marriage that you guys are together. And how much faster you guys can win? Okay, so you just threw out some numbers, so I just want to use it as an example. You have how much save, 6,000 did you say? I have $6,000 say, and then you have $2,500 over on the other end, right?

And then does he have any money saved? He doesn't have it, right? He's working on his housing. $1,25. Okay, perfect.

Okay. How much debt do you have, Melinda? I have $5,000. Perfect. Okay.

Great, so the beautiful thing is, if you, if you do the baby steps the way we've said, okay?

Um, you're going to have your emergency fund done tonight, your debt's going to be paid off. And then you guys are going to have $1,000 or two left to hit his debt, so it'll be down to $17,000. You guys working together. What's your household income?

“Well, that's why I'm not taking my savings and paying off that credit card, because I literally,”

I make more money than him. No, no, we, we have an income. You don't, we have an income. Oh, we have, well, I literally just lost my jobs. Oh, that's okay.

What did you use to make? What did you use to make? Um, I've 12,000 a month. Okay. And what did your husband use?

What did your husband make? He doesn't make that. He makes 4,000 a month. Okay. And what were you doing?

Um, I'm freelance. So I'm a consultant and I'm not worried about getting clients, I'll get back up to 10, 12k in a month. Okay. Then there's no more.

Do you have an issue of what of his work ethic, Melinda? Key works. Monday through Friday really hard, but you kind of like he works in them, you know, he works. He works with also with his best friends with kind of like fun and play and they're building

something big but they keep saying they're going to have this big return and it's them like two years. Okay. So I think you don't have that yet. So this is exhibit A.

You know, it's no, I get it. No, listen. This is exactly why we say pull your money together and work together because what ends up coming out of that is life and what ends up coming out of that is your questioning, holding your breath, fear around what he's doing over here and and if you guys haven't even been

aligned on that or had dates of hey, if it doesn't hit this, then we need to move on. Like nothing is aligned within the family unit, right?

“He's kind of off doing his thing, you're doing your thing and that's how you guys are”

living and when you actually force yourself to work together, some of these conversations that can be really hard, but actually very beneficial to your life and your marriage ends up coming up that you have to hit head on. Okay. I would suggest that you guys begin talking about this idea of combining all of our savings,

combining all of our income and combining all of our debts list. I would not start your total money make over today, keep going through financial efficiency, but I would not, I would not take you down to $1,000, when you get $5,000 worth of clients back up, which is probably two or three weeks from now, right? Okay.

When you get that, then push play on this and I want you to clean out all of the savings except retirement down to $1,000 and pay off your debt and start paying on his 19, which are both now, our debts and our savings and our income and our house and our car and

and I'm uncomfortable, I don't mind you having fun over there, but I do mind you're having

“fun over there while you're not hitting good income goals.”

That's starting to bother me, and we need to talk about that out loud and you know, I need to talk about the fact I'm a little bit scared right now, I just lost my biggest client and I'm down to zero and I don't like being there. And I feel like I'm doing a lot of the work and putting a lot of the effort, I don't feel the same from you and that's scary to me, I mean, all of it, it doesn't mean that it's

end of the world or anything or not, ending anything, but what this forces is, like Rachel said, there's tremendous level of communication and depth, because you're going to have a painful three or four weeks. Because if not, the resentment, so people that just push things into the rug and they compartment analyze and say, well, that stuff's over here here.

The resentment starts to build up and then you look up 10 years from now and you're like,

we've never even talked about this of how I've been feeling, because I haven't had

to because I've kept all my stuff over here. So what the, it just kind of forces kind of the junk up, which is not fun, not fun.

“You're going to have a hard three week, but it's going to be, but you're going to look”

back on all of this and you're going to have a, yes, a deeper, more cohesive marriage because of it, because of it. Now, and as you get further into financial peace, you're going to hear of this language a lot that you change your pronouns, not in a woke way, but in a way that says, it's we, we do this.

We do that. My wife Sharon has not worked outside of our home earning an income since our oldest daughter was born, who's 40, but we have an excellent income. We have a lot of assets. We have done very well and I would not have been able to do it.

Or she not keeping the home fires burning where she not a low maintenance, low drama person. I would not have been able to work as hard as I've been able to work. So it is a we, it's a we, and I was zero resentment that she did not do an income during that time.

It was our decision for her to do that. Well, I'm excited for y'all though.

“I know you're new to all this, but honestly, I, I'm pumped to see what you guys are going”

to be. You're going to do amazing. You're all your hard worker, your charger, I can hear it, and you guys are going to be awesome. So call us back if you have any other questions.

Here's the thing. Let's try it.

You always go back to the hallway, try something different.

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Mike is in Boston. Hey, Mike, how are you? Hey, doing good Dave, how are you? Better than I deserve. What's up?

Thanks for taking my call. I've got a situation with a solar system that I want to get your feedback on. I bought a home last summer, I had a solar system installed. That was finance and warranty through a company called Sonova. Part of the pricing was originally inclusive of a long-term like roof penetration, leap warranty,

and a power production guarantee. Long story short, a couple months into my home, prior to the start of leaking, so I had

to have the system removed and ultimately had the whole roof replaced.

It's a make matters worse during that time, Sonova went bankrupt, and a company called Son Strong took over the Leafs, but unfortunately, they claim that they are not responsible

So currently, I've got about $50,000 balance on the loan and all the solar panels are in my

backyard. So I'm trying to get your feedback on what the best next step would be, so I just take it as a dump tax and pay it off, or would you personally have them re-installed and just know that any future roof leak risk is something that I'd be taking out personally. Wow, what a mess.

Well, a couple of things, I would probably gather some information from an attorney to

“be sure exactly where you stand on this, but I think you've assessed this correctly,”

because I think the warranty wasn't probably offered by the company that went bankrupt and so the warranties worth nothing, the lease, which is where you financed the solar panels, is a separate contract, and that money stands separate of that warrantied guarantee, although morally, it shouldn't, but I think that's probably the way this is structured legally. And so, now we'll say that the...

Interesting situation. The people that led by the paper, the people that you owe the money to on this lease, they are probably having all kinds of problems collecting on a whole bunch of this paper. In other words, this is some bad deal for them, because they probably have a whole bunch of you out there.

You know, I'm saying not just Sarah, not necessarily Netflix, but everything else, because

they bought paper, or they financed for a company that in turn went bankrupt and now you've got a whole bunch of decides if I'd customers don't want to pay this bill. So I suspect you're not the lone ranger on this. I bet you they got this every day in Master dealing with. So having said that, do you have any money?

Yeah, I mean, in the payments, like... No, do you have any money? Yes. How much money do you have? I have enough to pay enough.

Okay.

“She have over $50,000 in cash that you could use.”

Yes. Okay. I would call them and tell them I'm going to sue them, because they're the only one left standing in a bad situation where my roof leaked, and the solar panels are laying in the backyard, they can come pick them up if they want them, or we can try to settle this.

And I'll give you $10,000 to pay it off and start there and buy this note out at a discount. Yeah. Because the note... It's interesting because it is a lone... I know it isn't.

It is an original contract. Yeah, the original contract for the loan, the pricing was solar plus warranty. So, to the original buyer, the people that owned the property before me, it was packed and when it was transferred to me for that matter, it was packaged as a package deal, and this is the price thing.

So I was just... I would just... I would just say... This whole thing's a piece of crap, you bought crappy paper. You know that.

You know you're not going to get paid out on it, so I'll give you $10,000 and we'll call it a day. Yeah, you're not going to get out of that in the law your fees cheaper than that. Yeah, and then you're going to own the solar panels and you can either throw them in the dump or you can put them back on your house or choice, but...

Yeah, for sure. But right now, what you've got is not a solar problem, you have those $50,000 problem. I don't want to get rid of that. I think they're going to take a discount. I don't know if they're going to take 10, they may come back and say 20, if they do, get it

in writing and write them a check and be done with them. Okay. I've got kind of conversations on going, but last time I spoke with them about that, they said the price of $50,000 even today. Yeah.

You even know it's finance that less than one person. Well, and let me help you with this. I'm going to sue you. Yeah.

I'm going to sue you and you're never going to get any of this because you people screwed

me and you're one of the ones that screwed me and I'm not going to tolerate it. So if you think you're getting $50,000 on a me, you're confused. Sure. Because they screwed you. Yeah.

“And you need to go see a lawyer and talk to a lawyer and find out exactly what your rights”

are in the state of Massachusetts. I'm not a legal expert, but this is how I would handle the business part of it and the relational part of it and you're being moral, you're being honorable because you got screwed. Giving them a dime for trash that's laying in your backyard is more than you should have to give them.

Oh, with the damage too. They should just pick up the trash and call the note off, but they're not going to. Yeah. And it's going to cost you more than 10 grand to get in the lawsuit, promise you. Yeah.

I can imagine. Yeah. So I don't want you to go there, but I really want them to believe you're going to go there. Yeah.

Okay. So. All right. Well, I'll just let the double up your fist and bust them in the nose. Yeah.

Just bust them in the nose. Just hit them hard. I'm serious. Don't be nuts. Did they hold the loan?

The company? Yeah. The paper was sold, and then they went bankrupt.

Yeah.

But the new company holds the paper.

“But I'm saying, yeah, they bought paper that they knew was bad.”

Yeah. Because they bought it from a company that was going bankrupt and it screwed a bunch of other people. So no, this is clad. I mean, they're like, it's like a case study in screwing people.

Hmm. It's not sorry, Mike. I'm sorry. You got taken in some mess. And then you've got to decide if you want solar on the house and whether you want

the roof to leak and all that other stuff. That's a whole other discussion as to whether or not it's going to be worth screwing with. But might be might not be, but that's where we get to. Wow.

What a mess. Wow. All right.

Up next is Michael and Minneapolis.

Hey, Michael. What's up? Hey, Dave. Hey, Rachel. How you guys doing?

It's great. How can we help? Good.

“Just to say first, we have no consumer debt and the only thing we have”

is our mortgage, the $155,000, $127,000 a month. To start off, I have an opportunity where I can get go back to school to be electrician. I want to do that back in 2019. I left it for some dumb reason and I got put in the wait list. I now have the sales job I'm making, $65,000 a year plus commission.

I've been doing that for about a year now. And we just got done with this debt, all of our little debts, and it just feels like-- How much does it cost you little school? $15,000. $15,000.

And can you work while you're doing that?

I'm going to work per time, yeah. My wife works full-time right now. What do you mean $20? $20? $20 an hour.

She just got the job. I don't know what that. That's not much. And so what are you going to be making part-time? That I haven't looked into that.

I just got the email about a week ago and we've just been boggling our minds on this. What happened if you went to work for an electrician company and they paid for you to go to school while you worked for them? There isn't up to me for that. But they're on a wait list too.

I don't know how long that would be. I don't know why all these wait lists come from. We have a shortage of trades everywhere in America. So I don't know what you're trying to do a union deal. And that's where your wait list is coming from.

If you do, then bypass the union and just go become an electrician son. And let somebody pay you while you're doing it.

“But I think you need to pursue it, but in a smarter way than you're outlining right now.”

As long as you can cast flow and you guys can keep your head above water financially for two years at the school and you're going to be making more than what you're making now. I'll be considerate. Hey guys, George here. Listen, 99 times out of 100 when people say, I don't know where my money goes.

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vetted by the ramsy team and are ramsy, trusted. Clare is in Salt Lake City. Hi, Claire. What's up? Hi, thank you for accepting my call.

So me and my husband kind of got ourselves into a situation with a vehicle. We bought it when we were living with my mom and we thought we could afford it and now the payments ridiculous and we just don't know what to do about it. Oh, which is the payment? It's $1300 a month.

How long have you been married? Um, a year. Okay.

Yeah.

Well, I'll try to kind of pull if I want to cry.

Yeah. And what's the truck, what's, uh, owed on it in total? We owe, I want to say 50 or 58 somewhere around there.

“First thing you need to do is call, who's the truck financed with?”

I honestly, I don't remember. Okay, call them today and find out what the payoff is if you pay it off this month. Okay. I think we checked it the other day and I think they said it was like 50/6. Okay.

That's what I was asking you. What you owed on the truck? Oh, yeah. And you weren't sure. So you're sure you checked it the other day?

Yeah, I checked it this month. Okay. 56, right? Do you have any idea what the truck is worth? Yeah.

I checked today. It's worth, like, 34. According to who? Tell me the book.

On private sale trade-in or what?

Private sale. Whoa. God, late. When did he get the truck? How long ago?

2 years ago. Did you have a car that was upside down and you rolled the upside down amount into this deal? No, we bought one. It was really high.

We bought the truck for, like, I don't even remember. What's your interest rate? But... Ridiculous. I think it's 17 percent.

Oh. Okay. Your 56 is not your payoff. That's not the right number. That's the balance.

That's not the payoff. Because you have a subprime loan, and they're giving you the total of all your payments. You're not that far upside down on the truck. Okay. Be more like fit, like what we're doing.

What I want to know is what the payoff is today, not what the balance is today. When you have a rip off subprime loan, they book the loan as the total of all remaining payments. That is not your payoff. Your payoff is not the total of all the payments, because it doesn't include all that interest.

So, your payoff is probably going to be 45. You're probably 10 in the whole, give or take. Now, what's your household income? Our household income is, and so I'm trying to think, like, 56 a month. Okay.

And what do you make? I make, I'm at $20, $19 an hour. What does he make? He's at $2670. Okay.

“So, so you guys bring him $5,600 at hits your account after taxes?”

Yes. Okay. All right. And you're working 40 hours. Yeah.

He worked over time, though. Okay. In addition to that. Okay. Yeah.

All right. Okay. So, we've been working on the baby since we have $1,000 saved. That's good. And we've been paying off the debt.

Oh, the debt. She just got a big bonus, though we paid off a bunch of our credit cards. How much was that bonus? It was like $3,000. Okay.

Do you have a tax return coming or do you know? I don't have a very big tax, I have like $100 coming from my tax return and he has maybe a thousand. Okay. All right.

Because you're desperately needing to get rid of this truck completely get rid of it. And you're going to have to pay the difference to do that. There's a couple of ways to do that. We want to save up, let's say you're $10,000 in the whole, as an example. You'd have to have the $10,000 to put with the $34 to get the thing paid off and get rid

of it.

The second thing you can do is you could finance that $10,000.

Okay. I'm worried, though, because we live in a cap trailer. And so we need to talk to pull the cap trailer. Sell it all and move into an apartment. This is killing you.

You can't keep this ridiculous but truck and have some irrationalized reason for doing it and live in a camper. You're dying over here. You got sell the camper too. What's the camper worth?

The camper's worth.

“I think just look at it, it's worth $54,000.”

And what do you owe on it? We just bought it out of a apartment. Oh, my God. And so you financed it, of course, and you owe $54,000 on a camper. Yeah.

Yeah. We owe $54. Okay. We're going to sell everything clear. Yeah.

If I woke up in your shoes, I would sell everything in sight and I would clean up this mess and it's going to take you a year to clean up this mess, running a little one bedroom apartment. You're going to work like crazy people all the time and you're going to have no life and it's going to take you a while because you've made some really, really bad financial decisions. This truck and this camper are the top of the list.

Five years from now, you're going to have two pieces of junk and still owe 40 grand.

And you're still be living in a dad gum camper. This is not a good long-term life plan. So. And we thought the camper because we're fixing up my dad's old house that he gave to us.

And then you're going to sell the camper at a lower price. Yeah.

“So you should have moved in an apartment while you're fixing up the old house.”

Instead of buying $54,000 or something that's going down in value like the toilet. Yeah. Yeah. So that's the plan. Yeah.

So you know you're fixing up the house with money you don't have.

Yeah. Yeah. How much you put into this house? Well, so my dad said he would pay for most of it. We haven't put anything into it yet. Good.

Is he living there now? I was doing no. He has his own house. Okay. My house is going to work on the house himself.

Is the house going to be put in your name or is it in your name? Yes. Already.

It's not an earning yet, which is why we haven't put any money in it.

Yeah. And don't put money and effort into it and do it in your name. And you've got to, you've got to start undoing some of these things. So you've got, you all got a mess. And I'm scared for you. So, but you've got to read back up and rethink how these stories end before you enter into

the story. And so we need to begin with the end in mind as Stephen Kovies said in the seven habits of highly effective people. And you don't buy a $54,000 camper to sleep in.

“It's going to be worth 30 by the time you have to get ready to sell it a year from now”

in order to fix up a house. You couldn't use that money to fix up the house. And so you don't, you've got to put quite buying things to go backward on big payments. And it sounds like you're sacrificing in your head. But you're not sacrificing.

You made a mistake is what you did. So you guys have got to get rid of this crap and, you know, if you can get that house barely habitable and move into it, that's a bright spot in the story. Yeah, you know, even if it's not nice, even if the, you know, the bathrooms on one end don't work or something.

I don't care. If you can get it where it's legal to live in and the plumbing is functioning. And you have a basic kitchen to operate out of and you can fix it up later and get rid of the payments here and start dumping all this stuff, this crap that you've got with wheels on it that's going down in value.

Okay, folks, a general rule of thumb is this. Not just for her, but for all of us.

“If you want to be poor, here's the formula.”

Buy a lot of stuff that has wheels and motors on payments. C-dose, four wheelers, motorcycles, cars, trucks, trucks, trucks, lawnmowers, by a lot of stuff with motors and wheels and put payments on it and you will be poor. . If debt collectors won't stop calling and you feel like you're drowning, you don't need

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Results may vary in those specific outcomes guaranteed. Today's question of the day is brought to you by Y-Refi.

Y-Refi helps you refinance defaulted private student loans with a low fixed rate payment based on your ability to pay so you can stick to a budget and work the plan. Go to Y-Refi.com/Ramsi. That's Y-R-E-F-Y.com/Ramsi might not be in all states. Today's question comes from Lauren in Maryland.

She said I'm a married woman in my 50s with $25,000 in debt that my husband doesn't know about. A part-time job and I'm slowly paying it off.

I grew up in a middle-class family and my mother was always trying to save a dollar was

drove me crazy. My husband is a good man who makes about $175,000 a year. We don't have a mortgage and have about 1.5 million in retirement. We have a healthy retirement investments and our parents have set up 529s for our children so college is set.

I like to buy nice things for myself but I feel terrible about the way I've handled my finances. But I continue to pay this off myself or come clean and tell him about the debt. Lauren, well to answer your question bluntly, yeah, I would come clean and tell him about the debt.

“Not only can you guys get this cleaned up together but also carrying around a secret”

like that and functioning at that level in your marriage is going to a road not only your marriage but also you. You can't carry that stuff.

The secret is what erodes trust in a marriage and so you're carrying that is not being

a person of integrity being fully honest and so that's going to be a hard conversation. You know, people that deal with with financial and fidelity and thankfully you guys have the sounds like the margin that you're going to be able to take care of it but man, people like it's stuck with this stuff, it does feel like a level of betrayal. Sometimes at the same level of actual infidelity going on in a marriage.

So I'm not saying it's going to be easy Lauren. No, I kind of, I can't expect her husband to be pissed because you lied to him. So I think that you know, I like nice things so I lied to you. I don't think that's okay and it's not okay and I think you expect him to be pissed and he should be not because of the money but because of the deception and the lying and that's

some serious stuff in your relationship.

“So yeah, you need to come clean yesterday, deal with whatever the consequences are.”

It may put you on the marriage counselor's office which will be okay with me.

Then the second thing is is that you can afford nice things.

Yeah. But you can't afford to do it under the table, had the target bags under the bed. That's not, that's not funny. This is a grown woman. And you're 50 freaking years old, it's time to act like it.

So yeah, you got, you need to, you and your husband need to sit down and have an adequate budget for you to buy some nice things. And part of it was you grew up in a tight household where they didn't have any money. And so your husband makes under $25,000 a year, you want to have a nice dress. That's okay.

I want 14 nice dresses, no then that's something wrong with you. Well, so you're going to say at that point, yes, where she is, there's stuff inside of you, and that's coming out sideways in the form of money. For some people, it's other things that they sit there and medicate with. But some people, it is, it's the spending, it's the money.

And so figuring out what that is for you, for yourself to get healthy, is going to be a gift later on to your marriage. But yeah, you know, so we can afford to do a lot of things that we choose not to do because in our minds of their ridiculous, but she and I share and I choose to do that together. And then there's some things that we choose to do that other people think are ridiculous.

I don't care what they think. It's not their money. And so we just buy that because we want to and we have the money shut up. And so you can do that, but you're in agreement on that amount. And so my wife wants to do such a such an redecorating, which is a constant budget line item.

And so, you know, but at least we know what it is and we're doing it together. And it's a reasonable percentage of our world. And it doesn't mess up everything else and she gets to enjoy that thing that I don't even understand. And so that's okay, I can do that as a husband, she can do that as a wife, but we can

be on the same page. And it's a line item in our overall plan and there's room for it. And I think that's the case here, there's room for you to have some nice things. And but but not by hiding them. So yeah, you need to come clean today.

“You need to expect him to be not about the money, but about the line for him to be really”

pissed. I don't know if anybody that wouldn't be. And so, you know, and you broke in trust, then it may take a little while to rebuild

And that's okay.

I wouldn't mind that for y'all at all because there's a lot of stuff going on here that

needs to be fixed. But yeah, but the way you all have been handling money as a couple has not allowed you the freedom to speak up and say, I want to buy something. Yeah.

“And it's either that you have an issue on that you have to live below your means and you”

don't like that. And so you go off and do whatever you want and go charge it on credit cards. That's your issue. But then on the flip side, he could be, he could be kind of a jerk and like shame when you ever ever purchased.

You know, I don't want to deal with that. I'll just come over here and do my own thing, too, right? Which is an issue too. So. Yeah.

But the way you're handling money as a couple has partly led to this either you're not speaking up or him putting his thumb on it or some of both somewhere in there. Taylor is in New York City, high Taylor, how are you? I'm good. How are you?

Better than I deserve. What's up? Thanks for taking my call. I have a quick question.

“I've got a lot of different opinions on.”

But basically, today, stop contributing to my 401(k) while I'm paying off my debt.

If you're working the Ramsey Baby Steps, there's not varying opinions, there's only one. There's only one way to work the Ramsey Baby Steps. And Baby Step 1 is save $1,000 to is temporarily stop all investing and completely focus on your debt snowball paying minimum payments on everything but the little one and attacking the little one with a vengeance.

That is blasphemy for those of us that know how to do math and we see that we're losing that compound interest and maybe missing out on a company match even for a short period of time. It's very hard for those of us like me that are nerds to do that. But we have found that the power of focus and complete commitment to becoming debt free

by both of you, you and your husband to the point that we're stopping the 401(k) completely, we're stopping saving completely, temporarily, that focus, that level of intensity is what causes people to complete their debt journey. Those that play footsy with it and try to do three things at once don't pull it off. Ish is a wish.

All right, thank you.

“Okay, so I don't know where you're getting varying opinions but they're not from our materials.”

No, no, just people in my life who I'm like trying to figure it out. Yeah, broke people have a lot of opinions about money. Yes, yes, oh, thank you, I appreciate it. Thank you for calling. It's hard.

I think that's true. If your broke friends are making fun of your financial plan, you're right on track. You're too good. If your fat friends are making fun of your diet, you're right on track. I mean, come on.

Ish, you gotta think about where you're getting your information. If you're getting your financial information off a TikTok, you're screwed. Yeah, but I will say the investing side. There are a lot of smart people that just say, hey, invest, regardless, like they wouldn't say to stop it, like we do.

Yeah, nobody knows. Nobody knows. We're the only one. Yes, I know. But I do think that's one of the hardest parts of maybe step two for people is to go

in and actually pause the 401(k) but there's a part of that desperation that's so emotional, that actually drives getting through it. And so that's for a lot of people who don't know that I'm missing out on the match. Yes. I'm pissed that I'm missing out missing out on some compound interest.

So I'm gonna drive through this debt that much faster. But here's the deal. What little bit you lose during that time, you make up for because you've now gotten muscular in the amount that you can put towards your wealth building because your most

powerful wealth building tool is not compound interest, it's your income.

your income drives the engine of compound interest. And when you give all your income to care repayments, you can't win. I know, well, and the 15% may be step four makes up for all of that, which is saying a lot of people just go up to their company match. And that's all they do for retirement. Well, just 3% they're whole lot. That's right. That's right. So the fifth year will be fine. You'll be fine. You'll be fine. You'll be fine. Taylor, a promise. You're going to be a multi-millionaire if you've

all of these steps exactly. [Music]

You too. How can I know? I'm 63. And my husband is almost 66. I retired from teaching two years ago. And my husband is semi-retired in the cattle business. We both chose to start social security at 62.

And we have been debt-free for many years. But over the years, we have always avoided investing money

in the stock market. We thought it was too risky. So we put it in CDs instead. And currently, we have about $755,000 in CDs ranging from 4% to 5%. And then two years ago, I ran across your show and learned a lot that I wish I knew a long time ago. And so year and a half ago, I decided to take a chance. And with the help of a financial advisor, I had $51,000 in a deferred retirement account. And I invested that in a growth stock mutual fund. And at the end of last month, the rate of return

was about 13%. For a 13% from wind? From a year and a half, it grew.

“In 2025, it grew 13%. That's what it had on the piece of paper.”

So the market would up 24%. So I think you picked a bad fund. Okay. We need the way Mandy are doing great. Anyway, you're doing way better than 4% on the right track. Yes. So here we are. I can see that even though that might not be the best things for a financial advisor to do for us, I can see that growth stock mutual funds can earn more than CDs because 13% is more than 5%. Exactly. So, but here's my dilemma. But we're, but with us being in our 60s,

and having this being in it for the long haul, we're just hesitant to move everything that we have in the CDs into mutual funds. And so we want to make some. Because you like making 40,000 instead of 140,000. Why are you hesitant to? Because it's all we have. I know. Because you think you're

“going to lose it all. I think I might need some of it. Well, you can just get it out.”

Okay. If you take it out of CD, you can take it out of a mutual fund. Okay. All right. It's not true. So deferred copies, trap, but mutual funds are not trapped. Okay. So in this stage of the game, you would suggest that we take it all out of our CDs. Are you living off of the money from the CDs? No, we're not. You're not touching it. No. I haven't touched it. So what would you want to take it out for?

Well, just in case with health wise, we also, we had a health event. We might need a hundred grand. Well, for maybe for nursing home, or I don't know where my kids might be moving.

“And it's like, need some money. Okay. Well, I mean, so what you need to do is you're dealing with”

the emotion. But what we need to do is put the reality of how a mutual fund works against that emotion and say how does this keep me from touching scratching that edge. Okay. So for instance, if the emotion is I'm going to lose everything, the only way a mutual fund would go completely broke is if 90 to 200 of America's top companies all became worth zero, which means that America

is over. That's never happened in the history of America. Yeah. The entire economy has collapsed

to zero if that happens. Because what we're saying here is General Motors, Alcoa, Alva Banks, all the whole depots, Apple, Tesla, everything is worth zero. And then you're 700 would be worth zero. So that's illogical. Okay. Okay. Now, do they go down sometimes? Yes, they go down sometimes. But it goes up more than it goes down. Right. And so let me just make you cry. Are you ready? Sure. In 2024, the market went up 26%. In 2025 it went up 23%. That means in those two

years alone you lost $400,000. Okay. That's what this fear has cost you. So I'm saying that not to say

your husband need to sit down with a smart vester pro. Go to ramsysolutions.com. They have the

“heart of a teacher. Tell them I don't understand anything. You're going to have to use words that I”

understand and you're going to have to teach me how these mutual funds work or I'm not putting a dime in them. And you're going to have to make me feel okay if I need the money I can get it. And you're going to have to make me feel okay by showing me charts and graphs of the last hundred years that I'm not going to lose my money. Right. You got to learn. This is learning. This is

knowledge. Right. It's I've never written a bike. So writing a bike is scary. But now once I've

learned a ride a bike, then writing a bike is not scary anymore. You've done a lot of things in your life that were scary before you learned how to do them. But you learned how to do them anyway. The time you learned to grab a car. The time you married that man and didn't know what that was going to be like. All that stuff, right? But you've learned about it and you've got past the fear and it's been a blessing with a knowledge. And so sit down with this Mart vester pro and learn learn learn learn

learn and he needs to go to. Don't do it because some financial advisors said do it or they rams you said do it. Right. Okay. That's the number you're missing out on. So I want you to get and if you decide, hey, we're going to put a hundred a year in for the next seven years. We're going to weigh it in. Okay. Instead of jumping. That's okay. Yeah. You put 50 in already and you don't regret that. No, I don't regret that at all. But you guys are young enough, Mandy,

to that you're going to have years. Decades still. Yeah. There's still a lot of time. There's a

million and a half dollars on your 92 colonists and you're scared of the market. At that point,

we'd say sleep well, have peace and enjoy your life. But you're young. You know, 60, 60, you're younger than me. 63. Yeah. Yeah. So Rachel, the thing about investing for anybody,

“including me, including you, is you have to learn about it. And then that keeps you from freaking”

out. So when like yesterday. The market dove. Yep. When they bombed our end. The market's back. Three days later. Okay. Those that get hurt on a roller coaster are those that jump off in the middle of the ride. So, you know, and then there's going to happen. There's going to be something else that happens. And this year probably won't be as good as the last two years. I don't, I am not projecting nor am I saying that mutual funds are going to produce 23 and 26%. I don't, that is not realistic.

Those are two unusually good years. Okay. But I think we're going to make more than CD rates.

And you have almost every year since the stock market's been there. It's almost always done

“better than CD rates. I do remember 1982 CD's were 12%. And the stock market, because interest rates”

were 17% on houses. Oh yeah. And CD's were 12%. And I remember my grandpa having 12% CD money market rates. And I'm like, oh my gosh. But that was 1982 in a highly unusual Jimmy Carter mess of the economy that we were in with interest rates of real estate being. We can spend at our 6% yeah. Yeah. Yeah. So that's, but most of my life, most of my working life 50 years, CD rates have been, you know, 2 to 5% right in there. And the stock market has been 10 to 15% on your rates of

return. But I don't get a guarantee. Now you have a guarantee. You're going to make less money. That's your guarantee. When you're in a CD, you got 2 guarantees. You're not going to lose your money and you're going to make less money. I'm guaranteeing you that's going to happen. Fairly keeps up with inflation at that point. These barely. Barely. If at all. .

Welcome back to the Ramsees Show and the Fair Wins credit union studio. Rachel Cruz Ramsee personality number one best selling author, my daughter is my co-host today. Michael is in Seattle. Hey, Michael. How are you? Hello. How are we doing? It's welcome to be here.

source of my life here. And I'm looking for some advice on what you guys would do if you're

in my situation. Currently, I'm on a day-to-day layoff with my company. They're currently trying to get rid of about 40,000 of their workers. So they're offering severance packages. And where I'm stuck is do I wait for the four to five years for potentially get full-time work or do I take the severance package and attempt to start an entrepreneur ship as far as buying a house outright and collecting that cash flow and starting my own company or should I invest

that into like stock markets, dividends, that kind of their mutual fund. So I'm just looking for some advice on what you guys would do in my shoes and where you would go. Okay. So it's fair to say

“the company you work for is not financially healthy. If they're laying off 40,000 people, right?”

So the future there's not very bright. Oh, yeah. I've been there since for eight years since I was

18, a single follower for. So it's hard to kind of step out into that moon. Yeah, I don't care. They're pushing you out on the land because they're not doing well. So four to five years from now is not looking bright. I'm talking about a day or two per week. Are you hearing me stop? Stop. I don't feel like you're listening to me. Okay. I'm saying your company sucks. So the future there sucks. Do you agree with that? I agree. It's hard to talk to Pat and you know,

give up on that 100,000 year. Well, I know, but you're going to have to give up on it because they don't want you there anymore. Right? Right. There's a few guys that are getting ready to retire. So so you're not laid off, Michael. You're just saying there's layoffs happening. But they're offering you, they're offering you a severance package to leave. That's correct. How much? Um, it's 150,000 after Uncle San Tase's percentage. It'll probably be around 100,000.

“And you make 100 grand. Um, potentially yes. So potentially, do you make 100 grand or not?”

I'm at 70,000 a year. Okay. You make 70,000 and you're they're offering you 100 to go away. Correct. Okay. All right. That's our reality. Okay. Let's deal with reality. And a 100,000 is not enough to buy real estate. Realistically. Okay. You're in and up with a bunch of real estate deaths. So we're not going to do that with it. So if you leave this company making 70,000 a year and you put 100,000 in your pocket, what would you go do for a living?

As of right now, we've got a family business going. Um, so I'd probably push into that for a little bit. Um, just kind of weigh in my options. Um, out of necessity of getting an income or because you enjoyed the family business and you want to make that a part of your next career step. Yeah. I enjoyed that as of right now is kind of an necessity with, uh, what are you doing right now? What's your job? Um, I deliver to driving the commerce. I'm

on a full-time package driver. Oh. Okay. So, uh, who's the family business, your parents? Yeah. I'm co-owner. So my parents, my sister and I are both, uh, owners of the company. Do you make an income from that? I do. Yeah. How much do you make of that? Um, I'm only going to happen about once a week. So roughly just a couple hundred bucks a week or a month.

Oh, just for what you're being paid, not as you're not getting the bottom line or anything.

No, we, we started about a year and a half. All right. Okay. 26. Okay. Let's pretend that you were 26 and could do anything you wanted to do in this world. And you weren't allowed to do the family business and you weren't allowed to stay in the job you're in. And you could be whoever you wanted to be. What would you go to?

“That, that's a fair question, sir. Um, that's what you need to do.”

You're teaching all, all of known as being a father in providing service. All, all you've known is landing in things by default, rather than by playing. Oh, there's a job over there. I can throw packages and I can make 70 years. Well, you did it for 80 years. And I could feed my family. But you did not sign up for that because it was the joy of your life. You signed up for that as a provider, as a father as a husband and a good man and a hard working guy.

But you didn't sign up for that and say, this is the, this is going to get my life meaning I'm going to make it big.

You backed into something because you had to have a job to eat and you're a good man and you're not afraid to work.

Okay. So I'm challenging you just take a step up from that. This is your opportunity to reset

“and land in something that makes 200 grand a year. And maybe you have to take three classes to learn how to do it.”

I don't know what it is or you start your own thing with some of that 100 grand or you take a class with some of that 100 grand. But this is your opportunity to say, not just because something's convenient, I'm not going to do it because it's convenient. The family business is just convenient. It's you backing into something else instead of walking head first into something else. Yeah, hold on the line, Michael, Christian will pick up and we'll give you kids book. Find the work you're wired to do because there's a great assessment in there.

Just to kind of get those wheels turning for you. Yeah. But this really is a good guy. I want you to dream though. And I would not invest or do anything with this 100 grand right now. I would just put it in a high yield savings account. I wouldn't even take the package right now. I'd figure out what I'm going to do first and then take the package. Because they're letting him stay and they're going to keep off from the package for a while.

So I'm going to take the next six months and do kids assessment.

I'm going to decide what I'm going to be and I'm going to start taking steps into that thing that I have always wanted to do X.

And now I'm going to go B one of those. And what must be true for me to do that as Henry Cloud says. And we're going to walk right into that. And then take the severance package and then use the severance package to go leave your dream. But no, I would not work at the family business. And no, I would not stay at this company that wants you to leave. But I would for a little while while I get reset and figure out what my dream is and what it has to happen for me to live that dream. You looking at buying real estate or dividend stock. That's just you looking at crap on the internet looking for something to do.

Well, and to learn some money. I mean, you get, you get your years worth the salary or more.

“Or handed in your lap, someone like him. And he's like, holy crap. How could I make this money work for me?”

Yeah. Which is a fair question. But that's the wrong way to go about it right now.

And until you have a study income, then you could take that and invest that later.

Exactly. But I would be having a monthly income. This hundred grand is not going to make your life. You're going to make your life. You're the secret sauce for your life. That's the thing. So hang on, Cristina will pick up. We'll get you a copy of that. Finding the work you're wired to do. Take that assessment, read that book carefully. Read or listen to anything Ken Coleman says. And he'll get you on the right track doing all this stuff.

He's one of the ramps of personalities for those of you that don't know. And specializes in this area of living your dreams and doing it. Well, here's the question. They haven't let him go yet. So sit there for a little while.

“But what if he's loving it? And he starts making more. Would you not stay at a company that's laying off 40,000?”

No? Regardless. Because there's no future. Yeah, but what if the 40,000 laying off the 40,000? Probably some up for a little bit longer. Yeah, probably some up for a little while longer. But I'm not, I'm not hanging around the place. It's going down the toilet. Hey, George Campbell here. So you're thinking about buying or selling your home.

It's exciting, but there's a lot to think about. And all those decisions can feel overwhelming. Well, here's the good news. You don't have to tackle the process alone. Ramsey's real estate home base is the place to find all of your free tools and resources for help to get prepared to buy or sell your home with confidence. You'll find calculators, start to finish guides, a podcast, and even an in-depth video course hosted by yours truly.

What's not to love? So if you're ready to take the next steps towards your home goals, go to ramseysolutions.com/real Estate. That's ramseysolutions.com/real Estate. If you're working the baby steps, the best and fastest way to do it is by using every dollar. Because every dollar will guide you, not only in a budget, but right through the baby steps. Doing this the Ramsey way. The plan is built into it. You track your progress.

You get personalized recommendations coaching for your particular situation. You free up more money. You work the plan even faster. You're working it together with your spouse. It's like having one of us walking with you every day, showing you the next right step. Do this, do this, do this, and then holding you accountable. Why didn't you do it? Start every dollar for free by downloading it in the App Store or Google Play.

Alyssa is in Montana. Hi Alyssa. How are you? Hi. Thanks for your call. That's an honor to talk with you guys.

Not sure what step we are in, maybe maybe set five. We're trying to make a decision if I can

be a stay at home mom. Cool. I love it. It's a, yeah, it's a really an emotional decision and we're both

“analytical. So let's do some analytics on the emotions. What are you, what are you make?”

So I'm working right now. We have one kiddo that goes today's care. I make 85 a year. What is your husband make a year? 116. 160. 116. 116. 16. Okay. Yeah. All right. And so what is your take home pay? Here's on the 85. 46. Okay. 100 a month. Is that right? Like 46. 46. 100 a month. Yes. Yeah. Okay. You got a lot coming out of that. Yeah. So what's coming out of that? Retirement and just other taxes. I don't have a lot coming out of mine.

Yeah, you do. 46. 100 is only 48,000. You said you make for 85. Yeah. There's a bunch coming out. Something's coming out of that check. What's coming out of it? I don't know maybe federal. No. It's not federal taxes. It's not just too much for that. How much are you putting in your retirement? Um, just into the match, which is like five percent.

“Okay. 5 percent. Are you putting, are you paying that family's health care out of yours?”

No, it's out of his. Are you getting a tax refund? Alyssa? No. We're not getting a refund for 25. Okay. Well, there's, I'm trying to help with this. But so, okay, let's use the 4600. Even though it's wrong in some, something's wrong with it. But anyway, your day care is how much? 800. Okay. All right. So after day care, which you would not have if you were at home, right? Yeah. Okay. So 46 minus 800 puts me at 3800. Is that sound right?

Yeah. Okay. If you take 3800 dollars and put it in the bank out of your budget for the next three months, that would mean you were living on your husband's income. Mm-hmm. We're, we're about there. We typically have about 4,000 in access each month. Okay. Okay. Then you, then you can do it. You won't have any access, though.

Right. And that's kind of the scary part. He, we just bought a house and it's our first home.

It's like $3,000 a month in all expenses for the house. And so it just feels like that's, did you guys do the math on both incomes when you bought the home? I mean, obviously. No, we try to make it on just one. You did. Okay. Yeah. Because he brings home how much? Seven. Eight. Yeah. And he's about 1%. Yeah. Your house is an awful, your house is a big chunk of his income.

Really big. Right. Yeah, it is. And so that's going to be a, you're going to be tied on the house. So what is the prognosis on him getting raises? I think really good. He just started there and it's kind of how to take a step down when he started there. But I think as soon as he gets like a year under his belt there, he can move up. So I don't think we're, like, in this situation for a long time. But it feels like we're going to go back to beans and rice.

How much do you think you probably are? You probably are for a year until his income comes up.

“You don't have any, do you have an emergency fund in place? Yeah, you should go on baby step five.”

I'm going to do it. If I'm you, I'm coming home. That's your desire. I'm taking it or you wouldn't ask the question, right?

Well, we have our second is coming in the summer. Oh, yeah. I just, would you, would you work the

home? Would you work till the summer? Work for the next few months? Okay. Well, how I do that? Listen, I would just stack some, some extra cash in another fund. Yeah. Just to have on the side, just to give you some peace of mind. Because it's going to be tight. Yeah. The first year of you being at home is going to be tight. But you're analytical enough. You know your numbers. We can tell because we do budgets for a living. We're asking people their numbers. They

don't know their numbers. That tells me they're going to be in trouble. But you know every number. You've got it all dialed in. The only number you didn't know is why you're take on pace so low. But other than that, you know every number I've asked you for. And so you, and it sounds like the two of you're talking about this together. He knows the numbers. And so if you guys do a written detail budget that makes you live on his income, minus daycare, and you stack all that cash, you approving

other savings being at home, car gas, dry cleaning on the clothing that you don't wear to work any

more. You know, you're not cooking from scratch, which is less expensive than a convenience-based food because you're working entire and you're not going to eat out as much because you're not working entire. And so there's going to be a lot of other potential places you save and do a two babies, two babies, they'll be tired. But yeah, you're probably going to be your friend. Yes. But being at home, being at home is what you're after. And you know, this is the cost of

being at home. We're going to be a home economist, make the economy of the home, be more functional

“than it is today, and. Yeah. And here's the thing, I was like, you guys made such great decisions”

up into this point. Yeah. Doing the babies have said that you're a, you know, I mean, that you

even have the choice, which is just wonderful. And so the, when John's alone he always talks about

solving for peace, like as a mom, as I hear you and your desire to do that, you're going to have peace. It's where you want to be. You want to be home with those babies. And so there's something that you can't put a price on that, right? And for a season, it's going to be tight. It's not going to you know, you're going to have flexibility financially. You're going to make your way. Sometimes people when people hear you say, don't put a price on it means you can do whatever you want to do. No,

that's you can't do whatever you want to do. But you guys can afford to do it. Yeah. No, well, no, but I would say the other way, if you can't do it and you still choose to, then you are going to be stressed, and there is not going to be peace. So no, there is a, a real piece that you have created. Right. But you're going to have to be grown-ups with the money. You can't just say, oh, I just choose to be at home and we're going to be responsible. Well, no, that doesn't work. You're not that girl.

You're not that girl. And it doesn't create peace. Yeah. And she's not, she's not that person. No. She's there for a couple of some, a congratulations. Because I would quit after the new baby comes. I agree with you. I'm, I'm in. And because it's your goal and you've, and you've earned the right to do your goal, the Rachel's point. Yes. Yes. Yes. Yes. Yes. Yes. Very well done. That's cool.

“You know, I, I remember the first time distinctly that I took a call and the lady, we figured out”

that with daycare and she wasn't making a lot of money. This was making a lot of money. But with daycare and whatever else it came down to, they had a $400 payment on their van. And that was actually what she was netting. So she was working to pay for the van. And it was like this light bulb comes on while we're talking to her, sell the van and quit your job. Don't work for a van when you want to be there with your kids. Yeah. And we, we've made that trade subconsciously accidentally

Americans have for decades now. And well, take care with two kids, right? It's going to be you just double it. You know what I mean? So like, it's that start to dwindle to your point. That's a much larger happening. Yeah. It's crazy. Yeah. And so it's, it makes it more and more reasonable to be at home. The more expensive that stuff gets. And then go, what is it? We're net net

“working for. We'll get rid of that debt. You can do it. And that's what they have done”

before today. They got rid of it before she made the call because they're maybe step five. When people hear my story of paying off debt, they say things like, "Deading 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.

We are better than we deserve. I love it. Where do y'all live? We are in Boise, Idaho. Oh, I love it. That's a great town. But welcome to Nashville all the way across the continent to do a debt-free screen. All right, and how much have you guys paid off? We paid up $580,000. Yeah. And how long did that take? 12 years. Good for you. And your range of income during that time? We started at about a 100,000. And last year we made 450,000. What do y'all do for a living? I'm an engineering manager. Good for you.

“Awesome. And I do music at my church for a part time. Very good. Very good. What was the 580,000?”

What kind of debt? It was our mortgage. Yeah. And it weird people paid off the house.

Yeah. So what's this house and Boisey worth? It's worth about 1.2 million. All right.

So we're a millionaires on the house alone. Look at it. Look at you. What a great house. Amazing. Oh, you guys. Congratulations. Why? It's your home, man. Yeah. That's got to feel amazing. That was amazing. It's been a long road diligence and a lot of patience. Yeah, we made it. It sounds like the majority of those years the income was at the lower end of that range. Yeah. And then it just swooped up lightly. It actually slowly went up. Oh, slow, slowly. Yeah. You'll steadily

don't have consumer debt. 12 years ago that you paid off first. No, well. Well, we just working at the house. No, we started in 2010. We actually took FPU for the first time. So what happened? It was in 2007. We bought a new house. We had kids. And then we took FPU in 2010. We paid off all of our consumer debt in 2010. Really? Exactly. You know what happened in 2008? We were way under water in our house. In 2013 we refinanced. And then my dad passed away in 2018. And then my grandparents passed away in

twenty-night. Over the course of the next year. So my mom moved up to the Boise area with us. And that's when we built that new house in 2020. Oh. And that's my, you know, we have a mother-in-law quarters where my mom lives with us. So we've steadily, you know, we've made decent money throughout the years. We just work on the land. We worked, we worked the plan. We were very diligent. You know, we went through the baby steps four, five and six. We put three kids. We have three adult children.

Put them through school. One of them was in the air force. Wow. So six grandchildren. Oh, look at your family. I just don't look all of them up to have six grandchildren. Oh my gosh. That's our wire right there. Yeah. That group changed the family tree. Exactly. Yeah. I love it. And these two sitting over here are the ones that started all this. Our mentors came with us. They met us out here. They joined us because they put us through FPU Jim and Debbie, our friends Jim and Debbie. They did the

first FPU at our church. They've been kind of inspirational for us. I've always wanted I want to be Jim

when I grow up. Yeah. Amen. It's amazing. Well, I'm glad they got to come with you. That's so neat. A lot of fun. And they get to celebrate your success too. And so how much of you guys got in your mistake these days? About 1.6.1.7 million. All right. So you're bumping three million. Wait a

“column. So proud of y'all. Well, time you guys. It sounds weird to say it out loud, doesn't it?”

It does. It doesn't feel like it. It doesn't. It was actually kind of strange as to laugh and when we first, when we went to the bank to pay off the house, it was a little bit surreal as expecting those streamers and balloons. Yeah. No. The bank was not that happy. You just say that a lot. Isn't it funny? I was kind of a downer. It's kind of, it's kind of, it's kind of, it's kind of, it's like, I'm acting. Yeah. Yeah. A lot of fun. If we ever get a bank to celebrate when you pay off

your house, we have a new bank. Yeah. That's so cool. Y'all, why do you go? Yeah. How do you feel to be

completely free after all these years? Yeah. That's amazing. It does feel amazing. You know,

we know we can be more generous. We really want to feel that exercise, that generosity muscle, you know, and help as many people as we can. That's kind of been a big part of our lives throughout the year. So we can, we can continue to do that. And also helping our grandkids go to school. Yeah, man. Oh, yeah. Absolutely. Yeah. What if your grown kids said, as you guys have been doing the sturdy, have they? They're proud of us. I mean, they're all three of our adult children. They're

debt free. Yeah. We made them take the class. They took a few as they were growing up through high school. And he's coordinating it. Yeah. I've been coordinating a few since 2013. Wow. Thank you. Oh, my God. It's a pleasure. I actually just started. I do it every spring and we just started this last week. So, oh, wow. Yeah. Okay. So the class will get to see your debt free screen. I guess. That's good. That's good. Yeah. That's real. Hey, my FPU court. I don't know about you,

“but I'm just sad. Yeah. So a way back in the day when you first went in the class, do you remember”

those emotions of like, I wonder if this whole thing's a con, I wonder if somebody didn't want to go? Well, we both wanted to go. Well, maybe she did. Oh, yeah. Oh, yeah. Oh, yeah. We are the prototype called nerd free spirit. Couple. I'm really nerdy. Yeah. I am super nerdy. I, you know, the whole spreadsheet thing. So I was into it. I like the plan. I like the process. Yeah. You know,

to cut up my Costco. That was the only one I was not willing to cut a Costco credit card. Yes.

“That was going to save you. Yeah. Yeah. I felt like it. I did. But once we tracked it a whole year,”

I realized I was spending about 30% more just wiping. Oh, wow. So I thought, okay. It's on paper. I can see it. Mm-hmm. So. Not theory. This is what I'm really doing this. Yeah. Wow. That's an interesting thing. And say 30% at Costco. I'm George Campbell would be proud of you. Yeah. Our court looking. He loves it. Yeah. It's awesome. All right. So now your coordinating classes for over a decade, almost 15 years. Mm-hmm. You accumulated a nice net worth of good income.

Your debt free, your kids are debt free, your family trees changed. This is a massive transformation. I mean, because when you started, I assume you didn't have anything. Oh, nothing. We were living paycheck to paycheck for a long time. From your years and years. We weren't paying attention. Really. I mean, it was just kind of. Yeah. Oh, money comes in. It goes out. You were normal. Yeah. You were normal. And I'm so proud of you. Yeah. What a great transformation. Thank you. God has done a work.

Oh, absolutely. So what do you tell people the key is that couple that comes in that first night, they're kind of looking side-eyed at you and they're like, what is this? I'm kind of called through

“what is this real? It's just Ramsay guy. Yeah. And what do you tell people the key to getting out of”

debt is? Because you guys are, I mean, you're like poster child. Yeah, for me, it's really simple. First is the budget. Mm-hmm. Getting it on paper, seeing it, you know, you're telling your money what to do each month. Like, you say it, I've heard you guys say it a million times. You just for you to the budget and you feel like you get a raise immediately. So we immediately had more money because we were paying attention to where it was going. And then just intentionality and

discipline. Always being on the same pace. Yeah. Always. Yeah. We talk about our money a lot,

you know. Every two weeks, I'm a nerd. We'd send a picture. I have this massive spreadsheet that I do have this budget spreadsheet. I'm an engineer. So every two weeks when we get paid, I go and I do our budget, you know, for the next, I have a six, I have it laid out for the next six weeks exactly what's going to happen. So even with the house paid off, I know Saturday morning, you're going to be going to be up there doing it. I actually enjoy it. He does. It's good. I love it.

Yeah. He likes to save, I like to spend. So Kathy, along this way, he's obviously a, a nerd

“of detail. I, along this way, how did you manage to keep your voice speaking into that budget?”

I'm the one, he just, I like to have fun. So he makes the money. I make sure that we enjoy it.

Right? Like that was by thing. I always wanted to take the kids' camping or I just wanted to do.

So you want to get a budget and see that line in the budget? Yes. I needed it in the budget. And he respected that. Yes, yes, yes, yes. Absolutely. We would go to the numbers. And I would, you know, if we, we would go to the line by line, I had my items for cash and things that would auto pay and out for the how much cash we're going to pull out every two weeks. And she's yawning until she gets to the camping. Here's the camping in the Costco line. Yes. Yes.

Yes. How much have I got for camping? How much have I got for Costco? But I know for me the biggest thing is keeping God at the center. And this is why we have what we have because of his blessings. Amen. And so we got to, we got to do right by it. Amen. So you got, you're, you're, you're being a blessing by being here today and sharing your story. It's inspiring. We appreciate your very, very proud of you. Thank you for teaching

the class. Thank you for your mentors to forget you guys in this. They've completely, I mean, all those grandkids, all those people are changed. Sweet. Because God's ways are doing things,

got inserted into your life. We really appreciate you guys and all your first time. I mean, I mean,

you don't know us from Adam. I see you guys around. I feel like I know everybody. I see John John Deloni and then I feel like we're brothers and you know, you guys know why I am, but you are. You are. You are awesome. And we are going to see you on the cruise next to you. Oh, yeah. Oh, yeah. Oh, yeah. All of us. Oh, yeah. Stephen Kathy. Boy, see you Idaho. 580,000 paid off the last 12 years. That's the last step.

They're house and everything. Baby steps, millionaires, count it down. Let's hear a debt free scream. Three, two, one. We're debt free. Yes. Where you guys? What an awesome couple. It's amazing. Very neat. 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

show whether you're making a decision or just want something explained ask Ramsey is here to help. It's fast, simple and free to use. Go to RamseySolutions.com and try ask Ramsey today.

That's RamseySolutions.com. Our scripture of the day, second, 10th, the two, six. It is the hard-working

farmer who ought to have the first share of the crops. Sandraday O'Connor says do the best you can and every task no matter how important it may seem at the time. No one learns more about a problem than the person at the bottom. Whoo. This is true. Stephanie is in Tampa, Florida. I Stephanie,

“how are you? Hey, I'm done. How are you? Better than I deserve. What's up?”

Thank you for taking my call. My husband and I recently had a baby. The last few years I've worked with the travelers and because we just had the baby I took a position as a staff making three tags less than I was making before. So we're just trying to figure out how to pay off 150,000 without me going back to traveling. What are you making a staff? I make about 80 K a year. What does he make? He makes 82. 82. So we have 162. And you were making bank as a travel nurse, but that's not

a good idea with a brand new baby I agree. Right. Did you always decided to come back home?

But it's taken a huge hit on us financially because I'm so I don't want to say I'm used as a money

“but you know. But you're used to the money. Yeah. Yeah. That's okay. That's a normal thing. I mean”

240 versus 80s different. That's okay. Yeah. Yeah. So were you making huge progress when you had the 240? We did make some progress but not as much as we wanted to. What did you do? What what were you doing? Where were you screwing off? Well I mean we purchased a house that was a I don't want to say it was a complete picture upper but we put about 100 and you bought a house

while you were trying to get out of debt. Well that doesn't work. Yeah. At least we'd have a house

now though and we wanted to have the house before we had the baby. So that's kind of what happened. Okay. Well the reason you haven't gotten out of debt is you put paying off the debt further down your list of priorities. Yeah. That's going to have to change. And so your priorities don't include eating out anymore. Your priorities don't include going on vacation anymore. Your priorities don't include spending 80 thousand dollars fixing up the nursery for a newborn who doesn't even know

that stuff's there. Right. Gotcha. So the thing is is my husband and I are actually pretty shrewd gold. No you're not. I would say we were making 240 thousand dollars a year and you didn't pay off hardly any debt. You're not frugal. Yeah. Well we're trying to be. No you in your mind you are but you're not not the reality as you spent the money. That's not the opposite of frugal. So you're

“going to have to get frugal though. If you want to make progress. Could Joel live on one income for”

two years? Like 80 grand. Yeah. I mean that's what we're trying to figure out. We have we consolidate our loan into a thousand dollars payment. And then our mortgage is about 2400. So that is our debt period. We have it all together and focused into two bills. So one is our mortgage into is our personal debt. Okay. Well if you can you know buy food, lights and water and throw money at this debt. Um 75 a year gets you out of debt in two years, right? I'll. I said how? Well you make a hundred and

sixty. Yeah but how do we how do we how do we do that? How do we live on one income when when we pay like 2,000 for one debt and the 2,400 for another? Well I thought you said it was a thousand but the 2,000 go towards the debt is part of the 75. Okay. Yeah so we need to get more focus. Yeah are you guys on a budget? All right one sixty two one sixty two minus 75. I got you there if you're you cough, turn off your mic and cough. Um seven year you guys do in a budget, a written budget.

We are and I have it in front of me. You do okay. So where are things that what is left after you

is left? Um I'm looking at the monthly total. Not very much. We're putting 1900 and to child care

“on. In the child care. For one baby. For one baby we pay 20 dollars an hour. Is it daycare?”

I know it's a babysitter. We couldn't find any opening to daycare around us. Hopefully we wanted to do

but we're paying for a babysitter since 20 bucks an hour. Okay. So the I mean the reality is

Stephanie that you guys it may take you three years. I don't know the plan but but to have a level of intensity that you guys have never had before is what this is going to require to get out of this. And is the one fifty was that student loans what was it? So um 150 total. So we have about 60 in student loans and then 100,000 in personal loans. And personal loans is that card debt too? No we paid off all of your cards. What did you use the personal loan for? So it was a combination of a roof

plumbing on our house. Oh for the house. Yeah so it was a combination of our roof plumbing on our house and then we had some credit card debt. Okay. What do you owe on your home? Currently we owe 281,000. What is your worth? I would say about 500,000. Yeah. Okay. Well some of what you're paying off is not consumer debt. It was part of purchasing the home. So um you know if you rolled some of that into a refinance that wouldn't be the

end of the world but I wouldn't do that. I think you guys make enough to plow through this but you're going to have to just look at this budget and go scorched earth. Beings and rice, rice and

“beans. Nothing. Spending nothing. Yeah so that that's what's I mean yeah it is it's just it's”

the mindset of having to the deeper you sacrifice, the faster you're going to get out and that may mean him working extra at night to stuff. Nate working weekends you bring in even more and come over time. But again the deeper and faster you sacrifice the faster you're going to get out and the less you sacrifice the less you kind of make everything a little bit more comfortable. The longer it's going to be of that process. So it really it comes down to families. I mean honestly looking

each other and just choosing like okay if we can adopt all your contribution to retirement. Upending into that we mean about $7,000 each year to both of us. Oh you are okay so if you stop that that's $7,000 free up. So positive retirement. Yeah positive retirement. Temporary. Yeah we have a lot of money in our retirement but we want to make sure that we're stuck for. You're going to be fine Stephanie. Yeah but this one 50's hanging over your head.

Stephanie if every time we bring up something on how you can get out of debt you tell me why you can't do it I can't help you. Oh no I don't need to be like that I'm just well you are. I mean you got

“you got to stop doing that okay you need to stop retirement you need to go through this budget”

with a scorched earth idea and burn the place down. You make a tenth of I mean you make a third of

what you used to make and you weren't even making it on that and you were calling yourself frugal. So you've got to sit down and start looking at this and going okay we have got to treat this like our hair is on fire we've got to treat this like the future of our family is dependent on getting rid of this stupid debt. Regardless of how we got into it this is how we get out. We stop all retirement we stop eating out we stop going on vacations we stop anything that

looks like a luxury and we plow into this debt like our life depended on it and in two years you can be done. Maybe three but two you should be done. You can pick up shifts at the

ER you can pick up shifts here and there and the good news about nursing is you can always

up your income temporarily without destroying the family without going back on the road. I agree with your decision to come off the road the baby I agree with that but then we went and hired a nanny basically and you know when you have 150,000 hours in debt and you make a 162,000 you don't live in nanny land. That's not nanny land. Nanny land is more income than you make and less debt than you've got. So that's where you are. And for a period of time for a period of time. Just for a short period of time

what have we got to do to go crazy to clean up this mess we've made and no excuses no rationalizations. You got to end it. That puts us out of the Ramsey show in the books. We'll be

financial peace and that's to walk daily with the Prince of Peace Christ Jesus.