Life Is Complicated. Money Doesn't Have To Be.

>> Brought to you by the every dollar app.

Start budgeting for free today. [MUSIC]

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

So we're here to help you transform your life. From the Ramsey Network and the FairWins Credit Union Studio, this is the Ramsey Show. I'm George Campbell, joined by Jade Warsaw. We're taking your calls at Triple 8-8-25.

I've two, two, five. Max is in Boston to kick us off. What's going on, Max? >> Hey, how's it going? >> Right, man.

How can we help? >> Yeah, I'm recently married. My wife came into the marriage with some dad. And I'm just trying to figure out who should be paying it. >> Ooh, juice.

>> I'm like this.

>> Okay, what does she think?

>> So she actually wants to take on the dad? >> My, my concern is it's just like, I don't think she's going to get anywhere out of the debt anytime soon, which I'm not a huge fan of. >> How much is it?

>> So she's got about 75,000 in debt. >> All students? >> So, a little over 10,000 is a new car. And then the rest is student loans, 14 of that being a bed, and then the rest are private.

>> Oh, wow. >> Okay, um, what's she earned? >> So right now, she's bringing in, if she doesn't work, any overtime after taxes after, you know, we're investing in retirement, and she's in a union,

and, you know, paying those dues, it's about 4,000. >> And what do you make? >> So after taxes, I bring in 5,000 in my salary, and then I'm in sales, and so I make commissions,

some months, good, some months, not really, but I average it out. And after taxes, investment in retirement, all that stuff, I make on average about 60 to 100 in commission a month. >> So, what other things do you plan keeping,

what other things do you plan to keep separate from your wife in marriage? >> Like, not really, anything. Like, we're kind of in that process of trying to figure out how to combine finances

and like when I saw that, and I'm like, okay, should I help take that on? But then she kind of wants to take it on, 'cause she doesn't want to make me, if you're responsible for it.

>> Well, sounds like based on your decision. >> Based off of what you said when you answered that question, it sounds like the decision is made, because if you said to me, well, Jade, there are a couple of things I'd like to keep separate,

I like to keep my work separate, or I like to keep my, you know, whatever, this might be a different conversation, but you said, I don't plan on keeping anything, separate, so that tells us the answer, which is we definitely need to combine this.

You definitely see marriage as a we-thing, not an individual thing, or at least, you know, pieces to be individual.

“And so I think that's a great framework to start with,”

and maybe that's the conversation that you have with her, to help her understand that it's not a negative thing, or it's not a weak thing, or unfair thing, for her to approach this as a we together with you. >> Yeah, yeah, no, no, I think that makes sense,

and I think that's a good first step.

>> It just puts some perspective around it, if you go to her and say, okay, it sounds like you're wanting to do this debt thing separately, is there anything else you put on keeping separate from me? I think she's going to go, oh, I get it, I see.

>> Yeah, yeah, I think she might want to keep it separate, I don't know if she just doesn't want me fully looking into like how she budgets, and how she how long you guys are married. >> You're looking at everything, bud. >> Yeah, I mean, is it very least, so you're in Boston,

have you been through a Boston winter yet? >> Yeah, yeah, I grew up there for the first 20 years of my life, and I would see my dad out there shoveling the snow. We had a steep drive way, and it was back breaking work, and what would my mom do?

She'd go out and help him. Now, she didn't cause the snow, right? But she sees him hustling out there, sacrificing goes,

“we're a team, why don't we get this thing done way faster?”

So instead of taking three hours to shovel, it gets done in one hour. The same is true of this pile of debt. She can try to do this on her own, and it'll likely take seven years, and she's going to resent you secretly without ever telling you.

>> Wow. >> Or you could get it done in three years, two years, by compiling your money together, going to one checking account, one savings account, one team, one dream, and you guys knock this thing out in your marriage is better for it.

>> That's true, another thing to think of, and I know that we're speaking to her through you. You don't seem to be the one that has the issue with it. But my mom told me, one of the best piece of marriage advice that she gave me was, whatever habits you start in the beginning,

those things will continue on throughout the marriage.

>> So the temperature. >> Yeah, you set the tone. So in the very beginning, start nipping things in the bud that you think will be problematic. And so I say all that to say,

something else you can talk to or about is, if we set the tone of whenever you're in trouble, you handle it by yourself. Whenever you do something you're ashamed of, you handle it by yourself, whenever you do something,

you think that, I may not approve of you handle it. That's a tone that you're setting, and that is absolutely not the tone you want to set for your marriage. You want the tone of, I can be fully known by this person, I can let them in on what I'm going through,

good, bad, ugly, whatever it is, because that's what marriage is. And so really have this conversation and speak about it in greater terms, not just financial, and I think that's gonna help a lot.

- Yeah, yeah, no, I think so too.

“I appreciate that, yeah, I think I'm trying not to like come off”

as like, you know, I guess controlling over finances. - I understand that. - Yeah, I'm not so, I'm trying to play that, like balance of that. - So I think if you stepped in, she would go, whoa, whoa, whoa, you don't need to be controlling me.

- Yeah, yes and no, a little bit just 'cause she's had some like, I came from like a debt like anti-debt family and she's come from one that wasn't, you know, crazy about having, or wasn't, you know, anti-debt at all. And then she's also had some, I would say,

issues with her dad when it comes to money. And so she's almost like worried that I'm gonna act a little bit like how he acted, you know, with her in, like, finances. - Okay, does she feel judged?

- No, not that you're making her feel that way, but if she feels that way. - A little bit, like, definitely a little bit, just 'cause I think it's just 'cause it's a good amount of debt. So I think she's doing a little bit judged.

- Okay, here's what I suggest.

Number one, I'm gonna give you a copy of my book, what no one tells you about money 'cause I talk about this a lot. Kowing into my marriage, my husband had 230, 200, some odd thousand dollars of student loan debt

and I only had 30. And so it was a hard, hard thing for him to accept us working together on it. It's like he just couldn't fathom it. And he felt really guilty.

He felt a lot of shame about that. And I walk through all that in the book. So I think that'll be good. Number two, you wanna know, counseling never hurts. It never hurts to just step in and have that

kind of unbiased person in the middle. Because the thing is, she's gonna feel judged.

“I think regardless of what you do, how you say this,”

because she's got personal baggage that's attached to this. And I think that's something that can only be worked out over time probably with the help of a therapist. And I think there's no shade on that, Jordan, I think that's a fabulous thing.

And now's the time to do things like that in the beginning of your marriage.

And I always like to flip the script.

If you were in her shoes and you had some debt and yes, whatever the student loans would you be like, man, I would hate for you to help me out as we get married and combine our money. I wanna do this on my own.

Now, some men do that because they feel like it's macho. And they don't wanna bring the woman into it. But I think there is nothing more freeing than being that open with your spouse, that vulnerable and accountable to go.

We're in this together, you make a mess. I'm gonna help you clean it up. I make a mess, we're cleaning this thing up. - Yeah, that's the point, man. - That sets the tone for the next 20 years of your marriage.

So this really isn't about who's gonna pay the loans as about what kind of marriage do you want? - Yeah, maybe play this call for her and let George and I be the explainers. I'll be the bad guy, and usually am.

(upbeat music) - If you've worked hard to keep your car running, the last thing you want is stress when you're running the kids all over to summer activities or loading up the family

for a well earned vacation.

“That's why I trust Christian brothers automotive.”

Listen, most people don't worry about their car just because it's older. They worry because they don't feel confident about what's happening under the hood or who's working on it.

And that kind of uncertainty can turn a simple trip into a stressful one real fast. But Christian brothers is different. They use digital vehicle inspections. So you can see what your technician sees.

Know what needs attention now and what can wait and make decisions without the pressure. That's how you protect your time, your money, and your travel plans. And Christian brothers stands behind their work

with the nice difference warranty. Three years or 36,000 miles, whichever benefits you more. So, before you're next trip, take care of the car that's taking care of you.

Go to cbac.com/ramsy to schedule your service

That's cbac.com/ramsy. 10% off up to a $250 value. See stores for details. (upbeat music) Ryan is up next in Philadelphia.

What's going on, Ryan? Welcome to the Ramsey Show. - Hey guys, how's it going? - Great, how are you? - It's good, so I am calling to see if it's a smart idea

to go $3.5 million in debt to start a chicken farm.

- This was not on my bingo car today, Ryan. I'm gonna be honest. - You said it, so like it was no big deal too. You just kind of slid it in there.

“- From your mouth to God's ears, is this a prank call?”

This is not. - Okay. - Is it $3.5 million off the bat? Like tell us what that entails. That's you buying the land, that's you buying all the equipment.

Tell us what the $3.5 million is. So about 600,000 of that is for the land, estimating a little high for the prices near me. And then the $3 million is for the Ford chicken houses to be put up.

- For chicken houses? - Correct. - What about equipment? - All the equipment needed to run that would be included in that, except for the skid steer loader,

which is about a $50,000 expense estimating high again. - Do you come from a long line of chicken farmers? - I do not know. I, when I grew up, I learned how to drive on a farm and helped load hay trailers and stuff like that.

And I have been working with chicken farmers over the last year, so I'm learning the business a little bit.

“- So where did this dream slash opportunity come from?”

Did someone come to you or is this just you spit ball and gum? Man, I wanna do this on my own. - So I live in a pretty decent area where there's a huge chicken producer around here and they need more houses and more birds desperately.

And this is something that I would enjoy and I would definitely like to make a career out of it. - So if they need more, why don't they build more? - They don't build their houses. I've asked that question before,

but they like to have the farmers grow the birds. So they do a lot of the, they handle the feed, they handle dropping the birds off, picking the birds up. I just have to grow the birds and that they pay me for them.

- What's the incentive, that doesn't feel like enough of an incentive for you is they're, feel like you're doing all the work for now. - You build the houses, you grow the birds. - Yes, so right now I'm making about $40,000 a year

or working as a fire extinguisher technician. These houses wall on paying off the loans, I would still be making around $90,000 a year. And once those loans are paid off in 15 years, maximum, I'd be making around $400,000 a year.

- And that's the assumption that everything goes right, everything goes according to plan, nothing is thrown for others. - So the company does have a lot of guarantees. So all the numbers I'm using are the minimum guaranteed numbers.

So even if my birds would die from the birds or something like that, they still guarantee that I'm getting paid.

“- So you make $9,000, but here's the thing though.”

You'll make your salary, but the loans are still due. So if you don't have great years, it's gonna take you more than 15 years to pay back this. - Well, let me just start by saying this. I, in no way, am for this,

but I just wanna hear your side of it. - Yeah, we'll cut into this case. - We're not on a spoiler alert, but this is a hard no from us, and there's no world in which taking on

any level of debt, let alone $3.5 million is a good idea.

- No older you. - I am 23, I'm married and I have a kid on the way. - Oh, I, so. - My goodness. - Yeah, to help you with the numbers a little bit,

the estimated gross income before all the expenses is around half a million dollars a year. - Right, but that's gross. - Correct. - I think all you're looking at right now

is the potential upside. - Yeah. - And then you're not looking at the guaranteed variable, which is I owe $3.5 million, no matter what, while I have a baby coming into this world.

- Uh-huh. - That's just too much, right? - And it's, and I don't mean any shade. There's no shade whatsoever to this, but I only mean it in comparison to the risk.

It's only $90,000. You're acting like they're gonna pay you half a million dollars a year to do this, and even still I wouldn't do it. But you see it, I'm saying you're like 3.5 million in debt so I can make 90,000 a year.

That just is not. - You can go, you can avoid all the debt and just go make 90 grand, isn't something. - Yeah, get a different type of job.

Here's what I would suggest, 'cause I know

we're... - I don't want your brain a little bit. - Paul Trey dreams here. - I'm thinking, can we start small and test how good you are at this? Can we start with a homestead?

that you and your wife and your, you know, soon to be children do and build that up? Is there something that we can do there? Because I feel like, is the play here,

“I want to be a chicken farmer, or is the play here?”

- I want to make lots of money fast. - So my overall goal is to have land that I can then reinvest what the land is making to set up future generations of... - Here's my question. - This was such a great idea.

Why is an every farmer in America going,

I'll take on 3.5 million to go do this tomorrow?

- Guys who have been doing this for a long time. - Guys who know what they're doing. - We're 30, 40, 50 years old. - Who have made up my entire brain, guys are? - What's that?

- Around my area, most guys are. They're required to do it in an hour of their production facility. So, again, at the beginning, I said, I was in a very fortunate area.

- Huh. - But, what is your wife think about this? - She actually gave me the go ahead. - Wow. - Can I ask you this? - She said, yes. - Can I, and this is what inquiring minds want to know,

what's the parachute? How do you get out like, 'cause when I'm making a big decision for Ryan, one of the things I do is I take some time and I look at the upside and I look at all the opportunity,

“I think we should do that, I think that's great.”

But, I also, I love to play out the worst case scenario, because generally, if I play out the worst case scenario and I realize, oh, I'll be okay in the end, that's a good indicator of whether I'm gonna still try it or not. So, we have not played out the worst case scenario,

which in my mind, and you stop me if I'm wrong. In my mind is worst case scenario, I make the 90,000, but the farm as a whole is losing money and it's losing money year over year, because by the way, we have a lot of farmers

that call in with that issue. It's losing money year over year, maybe you don't like it, maybe you realize what the farming practices are. I don't know, I've read a lot of books on it.

So, maybe you're like, man, I can't do this. This is tough on me, it's hard on the soul or whatever. And you just don't like it. And you're losing money and you're four or five years in

and you still got $3.5 million of debt

because the interest is high and whatever, what do you do? I feel like Kianu Reeves, what do you do? - That's a good question. So, I haven't totally thought of that.

“- I'm just thinking about the minimum payment”

on a $3.5 million loan, and then you've got to make that at least every month, plus enough to live. - He's guaranteed 90, and that's not gonna be enough to cover that bill.

- Who's servicing the loan? - So, it would be a farm credit, and maybe it's might be a little confusing. So, I'm guaranteed the roughly half a million dollars a year. 90 would just be what I'm profiting into my bank account.

The other 288, or no, sorry, I'm looking to all numbers. I roughly 300,000 would be going back towards the loaning. - To pay off the loan. - Yeah, that doesn't go toward upkeep of the farm.

And just like, who keeps up the farm and repairs things that go wrong and just normal business, wear and tear. - These are numbers I got from the poultry producer about their, what their growers are experiencing.

And it doesn't include miscellaneous repairs, insurance, electric taxes. - I'd go talk to someone who did exactly what you are attempting to do and get the full picture. I'm not gonna trust the poultry producer

who has a vested interest in you taking on all of this risk. 'Cause I'm telling you, why would they put this on a 23 year old? - If it was such a money-making scheme, they would be taking on the risk instead of you.

- I actually did talk to a producer. He's about my age. He did only do half the size so he put up two chicken houses, but looking at the notebook and numbers over to him

had dinner and looked at it. He said these numbers are pretty accurate for what he's making now. There's roughly a month and there's better months. - Let me put one more thing to you.

And my husband says this a lot 'cause he runs our business. When he's dealing with a major company like Disney or Carnival or one of these major overarching, he doesn't take on the risk

because they're billion dollar companies.

So if you're working with Tyson or Purdue or whoever this big chicken house is, I'm going 3.5 million, they eat that for breakfast. Why do you have to go into debt? When they could throw up those four chicken houses

in two seconds and simply just pay you a salary for running the farm. There's something about this that doesn't smell right and I-- - Not passing the smell. - That 'cause you don't do it.

- Please. And I don't even know. We didn't ask about income and current debts, but you're making 40K, you are not a place to be taking on this venture with a baby on the way.

I would run far away. (upbeat music)

- Let me tell you what I get asked all the time.

When should I get term life insurance? How much do I need? Is it affordable? Those are the right questions to be asking. So let's take a quick review.

The fact is term life isn't a baby step. So if anyone is dependent on your income,

“you need to have 10 to 12 times your income”

in life insurance. Now, and most people are surprised by how affordable term life really is. Even if you're not in perfect health, look, I understand the hesitation.

Since most insurance companies make it more of a hassle than it needs to be, not its under insurance. They're not an insurance company. They're a broker that works for you.

That means they'll shop and compare

the top term life companies to find the most competitive options on the coverage for your family. For almost 30 years, I've recommended Zander for straight answers, competitive rates, and coverage that actually protects your family.

Call 800-356-4282 or go to zander.com for a quick and easy quote. That's zander.com. (upbeat music) If you're sick and tired of working super hard

and having nothing to show for it, that is normal and normal as broke. You don't have to live that way. Our every dollar budget app helps you find extra money, every month, and helps you build a personalized plan

to beat debt and build wealth. And in just 15 minutes, you'll find thousands in hidden margin, and you'll feel like you got a raise. So don't live normal when you could live like no one else, start every dollar for free in the app store or Google Play.

“Angela is in Washington, DC, up next, what's going on, Angela?”

- Hi, I had a question. Me and my husband are currently going through and fertility treatments, and we were wondering what if the better to pay off some of our debt, we're gonna be going through it

in September or to save up for future expenses with our baby and day care. - Wow, okay, where are you guys at right now? How much debt do you have? - So we have my car, which is 25, okay?

And then we have his first degree along which is 50, okay? - Okay, and what do you guys make? - I make 52,000, and he makes 72,000 coming up in August, we're both teachers. - So you're getting raises?

- Yes. - Okay, so make an 120k, great salary. We've got 75k and consumer debt, and what are these infertility treatments costing you? - They are not costing us anything

because we received the grant that pays for all of it. - Oh, wow.

- That's amazing, and that's guaranteed.

How many treatments does that cover? - Yeah, that's guaranteed. What was something? - How many treatments does a cover? Is it indefinite or is it for a certain amount?

- So it is for embryo adoption, September, and it covers one treatment. - Okay, so what you said earlier, when you said should we pay off debt or should we save up money for treatment,

are you thinking that you could need treatment beyond September or beyond what your grant gives you? - That could be a possibility considering that it's like a 50/50 chance. - Okay, and if you did need money,

what would it cost? Let me phrase it like that. - It would cost about $8,000. - Okay, eight, yes, yeah, $8,000. - Great.

- Well, here's my vote, Jade made this agree, but I would just go full throttle baby step two, start knocking out these debts, and then let's say that it didn't work out, and now we have to pay for the treatment,

it's okay to pause baby step two for a little while to save up that 8k, and then restart, but I wouldn't just just agree. - I wouldn't just hang on to the debt indefinitely until we know.

So I would make more than the minimum payments, just to make some progress. You might knock out a few debts, and then realize, all right, we need to pause for four months, save up the treatment, and then hit play

on the baby steps again. - Yeah, and with your income, that really shouldn't be a problem. How old are you guys? - I am 30k on my husband is 36.

- Okay, so yeah, I 100% agree with George's plan, that feels like you're kind of making progress on your big goals, but you also have a plan

“in case you need to 8,000, and that's what I do.”

- Okay.

if this was costing you 10 grand, we would say, "Hey, just pause the baby steps and save up. The goal is to not go into any more debt." So that's kind of the step down. Is it gonna cost us debt to continue this process?

If so, we need to pause and cash flow, but because you guys have this grant, I would just go ahead and start knocking out some of these debts, maybe you get halfway through by the time you realize, all right,

we need to hit play on, say, not for the treatment, but I hope for you guys, it works out by some debt. - That's awesome. - That's the best of luck to you. - All right, Zephanaya is in Austin, Texas.

- You don't get those? - Don't get those, very often. What's going on, Zephanaya?

- Little George and Jade, basically what's going on

is I'm $28,000, and some change in debt right now with a car that I got like six months ago. And I'm about to get married, and I really don't want to go into the marriage, like with all the debt, and so I was wondering,

“like what were my options to kind of do to get rid of it?”

- You owe $28,000 on the car? - What's it worth? - So the car for private sale that I looked, and seen it was like, I think it was like 18 to, it was like 16 to 18, I think it's what I could get for it.

It's in 2025 to Rio de Corolla. - No, I get 16 for a 2025 Corolla. - Boy, did you roll some negative debt into there? Negative equity? - I'm not totally sure.

No, I did not. I didn't have a car before. - Okay, just a bad interest rate? - Yeah, I'm not an 18%

- Oh, yeah, yeah, yeah, yeah.

- That'll do. How did you get screwed that badly? - I was really desperate for a car and have a car, and I really needed one, and they let me put like $1,500 down,

and they put me an 18% in this. - Let me make this clear as a finite, you put yourself an 18%. - Yeah, it's not to knock you, but I want you to own the parts.

You just said, I needed a car. Did you need a $30,000 car? - No. - Yeah, there was too much of a pause there. It should have been the quickest note of your life.

- No, so here's the deal. Here's where we are. Here's the reality, your $10,000 under water. You gotta come up with that $10,000. There's two ways to do it.

Either you save up $10,000 cash or you go down to your local red union and get a personal loan for $10,000 plus whatever you might need for a beater car. And I'm talking 4,000, 5,000 bucks

off Facebook Marketplace Max. That's the only way out. If you said, "Hey, I want to get out by the wedding." That's the way to do it. How much do you make?

- I'm made about 40,000 a year in pest control. - Okay, is there upside there? Can you make $56 if you started hustling? - I could, there's opportunity for up sales and upgrades here.

Can you get about $150 every single one? - Okay, 'cause I know you can make really good money in pest control. The guys who are crushing it are not making 40. They're making a hundred plus.

- Yeah. - So I would be aiming to make more money that's gonna be part of this process.

“Do you have any other debt outside of the 28K car loan?”

- So we're like engaged. I have her ring two, and then you find it. - You find it, all right? - Yeah, I did, I did. - How much was that?

I think it was like 800, but like I wanted to get, I had the cash for it, but I wanted to get like the coverage for the ring, and they were gonna charge me more. So I was just like, okay.

- You took one of the coverage on there too.

- Let's pull back, because here's what I see

what's going on. And you're not the only person's effin' eye who falls victim to this. You walk in the place and you probably have something in your mind, "Oh, I wanna get a car.

"Oh, I wanna get a ring." And then somebody says, "Well, if you get this one, "we'll give you this deal." And you kinda before you know it, you're getting swindled into paying more,

you're getting swindled into paying in a way that you didn't plan to pay. In this case, you went into payments instead of using cash. You've got to decide who you are with money and don't let the salesperson decide for you.

That's the one piece of advice I want you to take from this entire call.

“Is Zephanaya has to decide who, what is my money philosophy?”

Am I a person who doesn't borrow money? If that's the case, it doesn't matter if I walk into a jeweler, a carla, or walk into publics. I'm not borrowing money, I'm not putting it on a credit card,

I'm not putting it on payments. That way, when you walk into those places, no matter what they say, you just go, no thank you, and you just move on. Right now, you're kinda just going with whatever

the salesperson tells you. So as you get married and as you grow into being an older adult, please, please, please, you decide who you are with money, nobody changes that. So that's thing one, and thing two is, just remember,

these people are salespeople. They're not, the business they're in is not to do you a favor, okay?

and I'm not saying that the person who sold you a ring

was a bad guy, I'm not saying villain like, they're a bad person. I'm simply saying, their point is to make money. Your point is to save money. Your point is to stick to your guns

and stick to your philosophy on money. So just understand the two roles when you go into those situations,

“and I think that's gonna help you out a lot”

in the long run, going forward. - Yes. - What is your fiance, make? - Right now, she is not working. She just landed a job part-time at an after school program,

and she'll be making like 21 an hour. - Okay, there, cool.

Well, you'll both be making about 40 at that point.

You'll have 80K, and so even if you went into the marriage and you still have this debt, you guys could knock this out fast and save up 10K and get out of it and get a cheaper car. You don't need to be driving a $30,000 car

if you make 40. That is simply too much car. (upbeat music) - Health insurance is confusing on purpose. You call one company get transferred three times,

sit on hold for 45 minutes, and end up more confused than when you started.

“That's why I recommend health trust financial.”

Their health insurance advisors who actually get to know your situation and help you find the right coverage for your life and your budget.

Health care needs change as your life changes.

Maybe it's a job change, the birth of a child, a new diagnosis, or you're just trying to have more margin at the end of the month. No matter your situation, health trust financial shops multiple, top rated insurance carriers

and helps you understand what you're actually buying. I've trusted health trust financial for over 20 years because they help Ramsey fans make smart health care decisions. Go to healthtrustfinancial.com today

and talk to a real person without pressure or confusion. That's healthtrustfinancial.com. Jim is in the rate of taxes up next. What's going on, Jim? Hey, what's up?

I'll just want to ask a question.

“Should I pay my business loan with my personal savings?”

How much debt do you have? I have $57,000. OK, I got $57 on 1 truck, $20,000 on another truck, $30,000 on trailers. And I got $82,000 in a personal and business truth that I use as a personal and business truth.

You got trucks on trucks? Are you the only employee or are you the only owner? How's the business set up? I'm the only owner and I got another employee. OK, what kind of business?

It's a hot shot business. Hot shot, OK. What's hot shot? It's you're doing like career work. Career work, like trucking.

But I don't have my CDL yet, so I'm doing hot shot for right now. So you're doing deliveries? The deliveries. OK.

What are you making? Because I'm the only, if it takes a, if a when you're new, it takes about three four months to start getting that business. So now that I'm right now that I'm new, me and my other driver running, I'm probably making.

I want to say about 12, 12, 13,000 a month, right? And Ronnie makes that to your other driver? No, no, that's in me and my other driver working together would make a deal between. So what are you taking?

$1,000. Take home, that's, that's take home, 12, 13,000. But you're not taking it. You said it's split. No, no, no, I mean, both of them combined.

Because I, I, what I do, we grows, we grows about 25, 25 to 30,000 a month. OK. And after the expenses, it's about about 12, 12, 15,000 a month. And then who gets what? How much do you take home?

To your family and how much does your other driver take home? To his family. OK. It's a percentage. It's a percentage.

It's built for whatever he banks. I pay them 23%, and I usually just bring myself a salary of $1,000 a week. OK. OK. So 4K a week is what you're taking in.

How much do you have in savings? I have $320,000 in savings. Wow.

It's week. So why all the debt?

“If you have all the savings, why not cash flow this?”

Man, it's because my credit started getting great. Great.

I have never had a good credit.

My credit started getting great. And I just started filing and getting everything under credit. I do have rental properties that bring me in about 2,000 a month because I live in a small town, which rent is not that expensive, so it brings me in about 2,000 a month. How much debt is on those rentals?

Zero. I got everything paid off. Wait, it goes. So your only debt is this business debt or all these trucks and trailers? Yes, I got my house paid off.

I got my rental properties paid off. Wow. $320,000 I have. I have them in a high yield savings account, so it gives me about $800 a month on it. OK.

So we've got, if I calculated quickly, what is this around $100 and $90,000 of debt? So you could pay all the debts off and still be left with $133,000 sitting in high yield savings. All right. That's pretty sweet.

“Have you done the math on what your cash flow would be?”

If you didn't have any of those payments? It would be a boy, if I didn't have any of those payments, it would really be about a day. Everything continues. That's lower than it is right now. It would probably be about $1,000 a month.

Dude, I'm just going for that life. That's freedom. You're not stressing. Because guess what, the lenders don't care how slow things are. And you signed on that business debt, right?

It's your signature. Yes. Well, my question is this because I wanted to pay all of everything except my personal business truck, which is $82,000. And I do have some kattles, right?

I have about $13,000 worth of kattles on a property I'm renting for $5,000 a month. And I think I'm selling that so I can put it in my debt over. Okay. I would still pay off everything, regardless of I can pay this off and then pay this off. You can pay it all off today.

So if you sell anything else, that's just pure profit. Yeah. What would you want with that? And your mind, what would be the, what's the upside of keeping the debt? What's the upside?

I've just, just on the personal business truck, I want to keep that one because it's a more region I get for working, you know, it's a more region that motivated by the debt to work harder.

But on that business, on one, on my business truck, you know, because it was a truck I always

wanted. So that's why I got it. Well, we're not saying to sell it, we're simply saying to pay it off. So we're not saying get rid of it. It'll have just as much sentimental value without a payment attached to it.

So if there's the range you principle, we recommend everyone start and run and grow their businesses completely debt-free because we have seen what the other side looks like. People call in, the business didn't make it something happen, a partner wanted out, and they are stuck because of these payments. It also changes the choices you make.

When you have debt on a business, everything is about making sure you're in line to make the next payment. Everything is filtered through the lens of risk and debt. When everything is paid for, it changes the choices that you make. I mean, take a moment.

I don't know how easy it is for you to compartmentalize this, but surely you understand the difference of feeling you had when your house had a payment on it versus when your house became debt-free. When your rentals had payments versus when your rentals became debt-free, there was a reason that you worked so hard to achieve that.

And we're simply saying, take that same logic and throw it over to this business debt. We think that you'll feel better about the state of your affairs if you do that.

And can I say, they're all that money, I also have, because I always had a system right.

So I always keep $30,000 in my business account. Yep. Keep that there. I do got, and I do got toy trucks, you know, and people, and my family members, because I talk to a couple of my family members, they tell me to sell them, but they're like

my toy trucks. I don't know if I sell them. Toy trucks is in these are real trucks, but they're just entertainment for you. Correct. Are they?

They're in cash? They're paid off? Yeah. They're all paid off.

“It's an 87-chivalet. I put in about 11,000, and that's what they offer me 20,000 in it.”

I think it's up to you. I think it's up to you what feels better. Do you want to keep your toy trucks because you like them or do you want to liquidate some of your savings? That's totally up to you, how you do it, but maybe you sell the cattle in the land.

You know, whatever you want to do, that's up to you. We just think that across all of your assets, you have the ability to pay off this $190,000 debt very, very easily. You can sell things left over. Yeah, definitely.

After everything you said, Jim, I'm like, how does this guy carry this all in his brain? You've got nine businesses, there's debts all over the place at the set. Toy trucks? I would just want to simplify my life if I was doing as well as you.

You should get the call. All right. Let's go out to Landon and Rochester real quick. What's going on, Landon? You got too much.

Thanks for taking my call. Absolutely. How can we help? Well, be my fiance or on, baby set number four, we just graduated college and December debt-free.

And I'm just curious. I've been putting a lump sum into my loss for the last couple of years at the end of my summer job in September. Should I keep putting in a lump sum? Now that I got a big boy job out of college or do I split it out and have a take out

of my checking, you know, through the 12 months.

“So you're really asking, do I do lump sum or dollar cost average?”

Yeah. Okay. Well, here's the theory. And again, nobody knows what the markets are going to do. But the sooner you get the money in and the longer you let it sit, the better off you're

going to be. So if you lump sum in January versus putting it, January, February, March, April, May, and spreading it, you will likely do better if you lump sum at every January. Okay. There's also a psychological component of when you can set it and forget it, right?

It's automatically taken out of your check. It's not something that you're thinking of. My contributions come out of my check automatically.

I'd never even count the money because I never even saw it to begin with.

And if you do a lump sum, let's pretend the markets are up or really down. Whatever it makes you feel awkward about it in your summer. Your summer gig now in September and you're like, oh, the market took a dip and now I'm going to lump sum it. Well, hey, you're buying it on sale.

Or hey, the market's doing really well. Well, you're buying it at the top. Right. There's that piece of it and there's the piece of now you've got to trust yourself that I'm putting this money aside.

I'm saving it. It has to stay there.

“And hopefully there's not a wedding in the Caribbean that sounds really good to me, right?”

And I use that money for that instead. You sound pretty disciplined in what you've been doing this for years now. Yeah, I mean, I pretty much owe everything to my parents or let me do this. They're pretty big believers in you guys. I've been listening to this show since my dad was picking me up at elementary school and

I was like, oh, I'm glad Dave's not here or that'd make him feel real old. But I love him. It's a great problem to have. If you're even asking this question, it tells me you are going to build generational wealth.

So keep it up. Just keep investing, no matter what.

Here's what nobody warns you about.

You're behind on payments, you signed up with some debt settlement company, you're making your monthly payments to them, and then one morning a process server knocks on your door. Surprise, you just got sued by a creditor. And that company you trusted? Not a law firm.

They're not built to represent you if things escalate. And now you're scrambling to figure out what to do next.

“And that's why I tell people about guardian litigation group.”

Guardian litigation is not a call center. They're actual attorneys at a law firm. And from day one, you're assigned a real attorney who can represent you if a creditor takes you to court. No scrambling with things go sideways.

Just real legal protection built in from the start. And look, the best way out of debt is still the budget, the plan, the baby steps. But if you're already into fault and legal threats are coming your way, Guardian has your back.

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

So get real legal help at guardianlit.com/ramsy. That's guardianlit.com/ramsy. It's herni advertising results may vary in no specific outcomes guaranteed. Welcome back to the Ramsey Show and the Fair Wins Credit Union Studio. I'm George Campbell here with Jade Worshaw.

Taking your calls at Triple 8-825-5225. Sarah is involved to more. What's going on, Sarah? Hey, thanks for taking my call, guys. Absolutely.

My question is, how do I handle the stress of being the person in my family responsible for making the financial decision? Wow. That was the nicest way to say I'm resentful of my husband for not being involved in financial decisions.

Yeah, why don't you like that? So my husband is really back with numbers like we're fairly confident he has like a learning disability with math, you've got the numbers. Okay. So there's something going on, because the thing is he trust me a lot and he will do whatever

I tell him to, even if it's uncomfortable for him if I tell him it's a no-send week until Bill gets paid on Friday. He won't spend a dime. The first week where we really got serious about doing Ramsey Plan and stopping with the credit cards was the week of father's day.

And I didn't have anything planned for father's day. And I said, I don't have anything planned if we want this to be like our last halal of the credit card to do something special for you for father's day. Can you do something special for free from other's day?

And he said, no, this is the plan that you said we're supposed to do is we're going

to do it. Right? Get trust to me. A lot. It's terrifying.

But, okay, there's two, I'm seeing this in two ways though. There's I'm bad with numbers, meaning I don't like arithmetic and I don't like crunching numbers. Don't do you see them saying like that, there's that side of it and then there's the side of if you explain something to me, if it has anything to do with money, I don't

get it. And it doesn't sound like it's that. It sounds like he's just not interested in crunching numbers and doing the arithmetic part of it. But it sounds like he's willing to be part of the plan.

And it sounds like he's willing to go over the budget with you and agree to the numbers. Am I missing something? No, yes, he's willing, he's still whatever I tell him it's the right thing to do.

“But I think what's happening is here is my wife calls this the mental load.”

There are things that he never has to deal with that are stressing you out and you're

feeling like, man, I'm carrying 95% of this in my head and I feel like he should be pulling more weight. Yeah, and then so we're, the gut picture is not pretty. We've got about 37,000 in consumer debt and 217,000 left on our mortgage. Okay, what do you guys think?

So what we are going to be making, I work for the school system and I just got into a full time position at the end of the year. Okay, so let's pan back just real quick. So George said it beautifully, you're feeling the mental load and it shouldn't be that way because what we teach is that both people should have a say in the budget.

It's okay if one person's more of a nerd and likes numbers and the other person hates numbers. That's okay. I have to have a say in a vote and for the person who tends to be way more relaxed like, yeah, honey, whatever you want to do, that's not allowed.

And the reason that's not allowed because right now it may feel like they're checking out and obviously right now the mental load becomes more for you. But on down the road, you don't know when he's going to decide he cares and he might wake up and decide, oh gosh, I feel like I don't have a voice or I feel like she's loading this over me or I feel like she's controlling and now there's some resentment

that has the potential to breed or on your side, man, I've been carrying this for years. He doesn't care right. So over time, the stakes on this get really high. And so today what you need to do is go to him and say, I understand that I'm more of the nerd.

I understand that I'm more of the mathematician, but I need for you when we go over the budget. I need for you to come to me with three suggestions every time. That's the only thing I need from you. So I know that you're asserting your opinion, it's important for me to hear your opinion.

And it helps me feel like I'm not carrying this all by myself because I don't want to.

“And I think if you let him know that that could help, have you done that?”

So I have in his response to that had been that I, his response to that had been I can help by doing, and so he does, he works his butt off, and he gets all the over time that he can get fit. He cares about it. It's truly, because I've heard the story, and I've seen the marriages where the husband

talked about building care, yeah, whatever you want to do, I'm not really invested in this. So what are you actually wanting from? Yeah. Then what do you want?

Like, file a dramatic wand. What would he be doing differently in this marriage? How much of this is on you to just own like you go to therapy, you know what I mean? There's, it sounds like everything you're saying like, oh no, he's great. I just, I can't help but think about all of this more than he does.

Because it is stressful Sarah, being in debt is stressful and you do feel a weight.

“There is a physical weight that you feel managing this and carrying this until it's”

done.

I'll be the first to tell you.

And George knows about it too. Maybe that's just what you're feeling. And I will tell you, there are points where you do want to offload it on to someone else. And when you're carrying that stress of debt, anything that happens, I mean, you're talking to someone who was in 460.

And so anything that would happen, I was looking for ways to blame Sam Warshaw. I was just looking for a chance. So I told him to leave some of this pent up of my seat. Yeah. I think they're good.

I blame myself about half of the debt burden is directly my fault. What kind of debt is this to 87? So about kind of its credit cards and small loans to my family, 17 of it is student loans, which would have been forgiven if I had actually applied for my employers to issue reimbursement and I couldn't figure out the process.

That's okay.

22 is a heloc, and we have 36,000 to my parents because our house is built in the 50s

and had a sister's sighting and covered in mud paint and started a call apart. And so we had to get the sighting read on before my two-year-old step-to-step decision that paint is now. So my parents, you have like a formal loan set up with them, loan this that money, it's 0%.

So a part of our snowball, we're still hopefully going to, you know, pay it off before it comes to or making payments on it. But... What is the game plan here? If you got sat down and said, "All right, we're going to be debt free in 18 months."

So I've made it all out, and we are going to get free by September of 231. What? That's too long. I just did some answer. You guys bring home, you'll be bringing home 8,000 a month.

Right? I pay 575 dollars a week and take care.

“I'm saying you bring home, what will you be bringing home?”

Bringing home, we should be bringing home after taxes and insurance, what I'm 32, he's 36. My guess was about a hundred k, net. Yeah, but I also am wondering, do you need an every dollar budget? Because when you have an every dollar budget, you know those numbers, like any split. So we're going to make sure that you have that because it's going to help you.

You might be doing a spreadsheet, I'm not mad at you, but every dollar is going to help you more. So we're going to give you that for free. Also, I'm going to give you my book, what no one tells you about money. Because the things that you were laying out are exactly to the T, the things that I'm talking

about in the book, everywhere from parents loaning you money to having student loans, to feeling the weight, to feel all of that isn't the book. So you're going to get that for free and September of 2031. No, I'm going 2028, 3600 a month out of your 8k, you're done in two years. It was that simple.

Now go for it. Business owners know it costs money to make the phone ring. Maybe it's advertising, maybe it's referrals, maybe it's years of earning trust. But when that call goes on answered, all that work can disappear in a hurry.

“And that's why today's episode is brought to you by Quowe spelled QUO.”

The business phone system built so you never miss a call.

With Quowe, you and your team share one business number so you can reply faster and stay on top of every customer conversation. Quowe works from your phone or computer, logs calls, summarizes conversations and gives you next steps. Nothing gets missed and every customer gets a response.

And here's what I really like. Quowe's built in AI agent can answer questions, handle after hours calls, and even help book appointments. So you're not losing leads just because your team is offline. You didn't start a business to spend your days playing phone tag and digging through

texts. Quowe helps make sure you don't ghost the customers you've worked so hard to attract. Money's on the line.

So always say hello with Quowe.

Try Quowe for free plus get 20% off your first six months. When you go to Quowe.com/Ramsy, that's QUO.com/Ramsy. We're heading to Columbia, South Carolina up next, Reese joins us there. Reese, welcome to the show. Hey, you're already doing it.

What's going on? Oh, we're losing losing, you speak directly in your phone. Oh. Come here. A little better.

Don't do another room with a house. Oh, yeah. Um, getting every good? Yeah. That's better.

Awesome. I'm pretty sure I'll take my call on Jade and it's forage.

“My question is, how do I make sure I'm going into business with the right motives?”

I want to make sure I'm not needlessly gulping myself over and wanting to make a profit. But also want to make sure I'm not chasing the dollar every day. I just graduated college, no debt, and I'm a Christian, and I want to have the proper values about everything, but I just don't want to get sidetracked along the way. What are your thoughts on getting paid for a job well done receiving what you earn for

a job really well done? I think that's a great thing. Well, then all right. Do you have a job now? Yes, sir.

What do you do? I'm manufacturing. And what do you want to be doing with this business? It'll be in sales. My family works in sales, and I've worked in sales, I enjoy it.

I'm confused. You want to start a business in sales? What are you selling? Sheds, sheds like lots, locations. I know the business really well, and I know it'll do really well.

Okay. Sell sheds as a business.

“So you work from manufacturing company, how do you get paid right now?”

Is it out of the profits of the business? I'm hourly. Okay. But I'm saying the way they pay you is they make money. They take a portion of that money and they pay you.

Yes. Would you consider them to have bad motives in doing that? No, no. So where does the line come? What do you think?

You described us what it looks like. My screen says, how do I start a business without idealizing money or success? You explained us what that looks like, because then we'll know if you know what it looks like, then you'll know if you're venturing over into that territory. So what does that look like?

So, one location, I have what I have in mind, I know it'll do really well. It provides more than my basic necessity in the cities and needs, and looking down the road for five years and I'm knowing I could do it in possibly two or three or four of these lots. Yeah.

And I question why would I want to, and I'm like, well, obviously it's going to make more money. I can help more people.

“I can provide good jobs for people, but I feel a small amount of guilt where I'm just”

said it first thing that comes to mind is, oh, I'll make more money.

And I'm just worried about if I go into that with that mindset that maybe a lot two or four, I don't know, I'm worried about chasing the dollar more than providing a good more service. I see. I mean, I can understand what you're saying to an extent, but one thing that I've learned

about money, I know George has learned this and you've probably heard Dave say it too, but when you were really good at something, you do tend to earn more. And what money does to you, it doesn't make you bad, it doesn't make you evil. It tends to make people more of what they already are. And so you're already a kindhearted person.

I can hear that. You're already a generous person. I can hear that. You're already a very thoughtful person. I can hear that.

So it's probably going to bring more of that out in you. You're probably going to become more generous. You're probably going to become more thoughtful, all of those things. I can tell you this, and George, George, and I peaked at the screen during the break. And we kind of read a little bit of what the call was about.

And we thought to ourselves, gosh, the person who had the ability to idolize money would

never call in saying, I'm afraid I'm going to idolize money.

So the kind of solved our problem, like, Reese is not going to be an issue. You're not that guy. I appreciate that you're thinking about this. I need it, I guess. I know what I need.

Yeah, well, there's no scripture that says making a profit is evil. So the question is, who is being hurt in the process of making these profits? Do you treat your team well? Do you treat your customers well? Are you doing everything ethically?

And you kind of know, all right, this is a buff board. So scaling a business, it's not, you're not more, you know, better morally or have more virtue because you kept your business small. Yeah. You know what I mean?

It doesn't make you a better person than the guy who is scaled to 48 locations. So I don't want you to look at scaling as the immoral thing.

“I think it's always good to question, where is this ambition coming from?”

Am I actually discontent? Is it greed? Is it pride? What's driving this? And that helps you kind of gut-check yourself along the way.

But I'm excited for you to start this business. We need more good entrepreneurs out there. And I hope you're one of them race. I appreciate it. Thank you all.

Absolutely. I love that question. I think that it's good that he's thinking about that.

And I always think about the scripture, it's in Deuteronomy 18 and it says, "But remember

the Lord your God for it is He who gives you the ability to produce wealth." And so that just reminds me, "Oh, like He's giving me the ability to do this, it's not a bad thing, it's not a negative thing. All of the things point back to character, which is what you said earlier, are you being a good person, is your character morally right?

All of those things are kind of separate from the matter, but producing wealth is a good thing." I mean, profit equals abundance, and somehow we've confused abundance with evil. Yeah. And what you do with that abundance is very telling.

That's right. But money is a moral. I mean, you know, a brick can be used to build a hospital can be used to break some windows. You get to decide. So I hope that helps.

Race. Appreciate the call. Jo is in Boise up next. What's going on, Jo? Not a whole lot.

How you guys going today? We're doing well. How can we help? I was just looking to see if I should sell my house. I've got quite a bit of equity in it.

And unfortunately, I'm going to pull out of our 401(k) just to put a new roof on the place. I did have to work myself, but I just, you know, wonder when I should cut my losses because we just are not going to be able to buy what we have locally. Can you not afford the payment or other issues?

It's just those, you know, those homeowner issues, like an average friend since, you know,

like it's going on. Well, like if an emergency funds solves your problems, let's not sell the house. Yeah. Yeah. That's it. We depleted it and then we get it out again and then something else comes up.

“Tell us what you pay every month, what's the mortgage?”

The mortgage is 22. And what do you guys bring home every month? What's your after tax monthly income? So it's 70, a year before tax. So call it, hmm, I'm going to call it like 38.

38. It doesn't feel right. That feels weird. We don't live in Canada. We don't have to tax it. I get the report tax members not the after you say at the pardon.

Okay. I'm saying, don't count 401k. We're not investing right now. Well, we got debt. Don't count health care. We're just saying, what is the like after your federal and state taxes are paid? We're bringing in.

“Let's say 4,500 a month. Yeah. That's probably closer to you. You have to pardon me.”

My wife's actually the breadwinner and on the state home parent. Yeah. I make all the financial positions for us. And the household. Okay. So based on that, your mortgage is half of your take home pay. Correct. So I've already and it helps that there's multiple structures on the property and I turned one of them into a rental. So we're generating 1,500 a month from that on top of your 4,500.

Correct. Okay. So that brings up the 6k. Now it's a little over a third of your take home pay.

We recommend 25% of take home pay going towards your housing. Whether that's rent, your mortgage. And so you're still over the line that's still it's putting you guys on a slight pinch. But I'm guessing there's a lot of other debts as well that you're trying to pay off. No, we actually have no debt. You have no car payments, no student loans, nothing. So we essentially took everything we had and invested it into this place.

And it helps to know that we essentially paid half price. It had a praise that 500 and we paid 290. So I mean, anyone would have jumped at the opportunity. So then this is a monthly cash flow problem. This is a month to month cash flow issue because, you know, a third is a little bit more than I'd want for a mortgage to be. But if you're saying you have no debt, nothing else going on.

I'm looking and I'm thinking and you're staying home with the kids. So we don't have an astronomical daycare bill. I'm wondering if this is a budget issue. Do you guys have a budget? Yeah, we definitely have a budget. It just seems like lately all those costs keep going up and up, you know. Oh, what costs? Oh, the gallon here. You know, groceries. It just costs a lot. It seems like every week now. Well, what's your margin? When you when you do the budget,

what's your margin at the end of the month? You mean like for the same age line? No, what's left over after? When margin is money that's left over after your bills are paid and after yeah, yeah, yeah, yeah, yeah, yeah, yeah. So you bring home six, twenty-two hundred. You probably have close to a thousand dollars. Okay. Over and above all of the bills and then so you do have more to know the house that I'm living in that I converted. It's half finished. I'm fine.

Fine. Well, here's the good news, Joe. You guys have a thousand and margin every month.

Let's set up an emergency fund. So we never have to be in this position again. I wouldn't sell the house.

[Music] If you're waiting for the perfect interest rate before you buy a home or refinance,

“that moment may never come. That's why people should talk to Churchill mortgage”

because rates move every day. And when rates drop, buyers flood the market, which means more competition in higher home prices. Smart buyers know they can't time the market. They move with a strategy. By the home, you can afford now and refinance later if rates improve. Churchill helps you understand what you can actually afford, not just what you qualify for. And with their certified home buyer program, you can get fully underwritten before you shop,

so you can make moves faster and make stronger offers. And right now, Churchill has a special offer only for the Ramsey audience. Go to ChurchillMorgage.com/Ramsieoffer to learn more. That's a special website. Remember this. ChurchillMorgage.com/Ramsieoffer. This is a paid advertisement. It's Churchill certified home buyer program is available for qualifying borrowers and select non-types only. In MLSID 1591, in MLS Consumer Access.org, equal housing lender. 1749,

Valerie Lane, sweet 100, Brent Wenton, to see 37027. Our question of the day is brought to you by Wiry Phi. When past two private student loans keep pulling you backwards, it's hard to focus on what's ahead. Wiry Phi helps borrowers with low fixed rate refinancing options that fit your budget, so you can focus on the future again. Visit Wiry Phi.com/Ramsie. It may not be available in all states.

our combined debt of $60,000. Her student loan balances total 9,000 and mine total 51,000."

I keep telling her we should just tackle all her debts first and then dive into mine. But she

keeps saying we should list each and every one of the loans and tackle them individually. I would really love some clarity on how to do the debt snowball method, starting with her loans seems more doable to me and would give us a bigger shovel for the remaining ones. She is insistent

“that we should start with the smallest individual loan and work our way up from there. Who's right?”

Okay. As usual, it's her. Yeah, she's right. And, you know, Brendan, I understand what you're saying. There's worse things you could probably do in life than do what you're saying, so I'm not saying like what you're suggesting is bad or evil or wrong or anything like that. But if you're walking the Ramsey way, which is proven over millions of people over 30 years that this is the best method, the debt snowball and the reason for it is for people who really want to see it through the end

and actually pay off their debt. The percentages are higher of people who actually pay off all of their debt, not just some of it. They're higher when you do the debt snowball method. So to clarify, with the debt snowball method, you list all of your debts by balance, not interest rate, not what you owe monthly. It's by full balance from smallest to largest. You pay minimum payments on everything.

“And the reason for that is we don't want to get behind. We don't want 1,800 pay me calling you,”

which are also, you know, bill collectors. So pay minimum payments and then whatever is left over. After all that, whatever margin you have, you throw it at the smallest debt. And what it does

ultimately is let's say you have seven a list of 17 different debts. You know, it feels really good

to be able to knock off four of them. Even if the balance was only $200 or $87 or $99. It just feels good psychologically to be able to, you know, cross those off. You feel good about it. You do get a dopamine hit and that makes you feel like you want to keep going. So that's kind of the nuts and bolts of how to do that. And George, I know you guys did it. You did it. Oh yeah. And I love, so I actually looked into this from my book, Jade, breaking free from broken in there.

I found that time magazine and Harvard Business Review came out and said turns out Ramsey is right, like based on the actual research, the data. Here's the quote, people are more motivated to get out of debt, not only by concentrating on one account, but also by beginning with the smallest. So it's a both hand. It's all about momentum. You need a quick win. It's more about behavior than the numbers. So we wish you guys the best in this debt pay off. Come celebrate when you're done.

All right, Ryan isn't Charlotte on the phone up. Next, what's going on, Ryan? Hey, big fan of you guys. So earlier this year, my sister had passed away in the car accident. Oh, and so so recently, we recently received her ADMD and life insurance pay out in my parents

“that split it between my brother and I. And so I'm trying to figure out what the best way”

to make that money, like what's the best way to put that money to work for me? I'm currently in

baby's up to. Wow. Well, first off, we're so sorry for your loss that sounds incredibly

difficult. Hate to hear that for you. The second thing is how much did you receive? So we're doing $20,000. Okay. And what do you have in debt right now for consumer debt? So I just have student loans. They total up to just about 85,000. Okay, so if you took that 20 and attacked the smallest balances, how many could you knock out? Um, let's see, three, at least three, and then chunk another 10 into the big private one.

Sweet. So you'd be making some progress and freeing up some payments right there. And now you're closer to the home stretch by doing that. How much do you make? I make 65. Is that your household income? Yeah. Yeah. I'm single. Okay. How old are you? I'm 25. Okay. Um, private student loans tend to have higher interest rates in, in some cases,

but because they're private, sometimes there's some wiggle room. So I might call over there and just see if there's anything that they can do about any of these interest rates, if there's any, just wiggle room. If there's any that they'd be willing to make a deal with you on, I know for Sam and I, we were able to make a couple of deals on some of our private student loans. We were able to get the interest rate lowered on some of them. Now granted, we had them around

a little bit longer than you, but it's worth a try. And a lot of times those get sold off anyway, they get, um, moved around between different private companies. And when that happens, those are, that's generally the best time to try to make a deal. So call them up and try it, especially

Yeah. And I think, I think the main thing that I'm wrestling with, um, I guess mentally and

“emotionally, is it feels, like if my sister were still here and just gave me that money,”

what would she want me to do with it? I know that you guys talk all the time about the sooner I get out of debt than the more I can do, um, those kind of things. And I don't like, I don't know if I put, because she would just want to travel and make memories and go on trips. I don't know if I take even three grand of that 20, um, and kind of sock that towards a trip fund, if you will, and then put the rest, um, at work, or, um, I guess that's my main struggle with, um, with this entire

situation. Interesting. Interesting. Man, that's probably about a logic. Probably slows you down

by, maybe a couple of months, right, on your actual debt-free journey. If you're 17 or 17,

“I don't know math. I've done the math, um, anywhere from putting five k towards the loan up to the”

full 20. Um, and I see how many months from saving, if I don't put any, uh, towards that, um, there's also nothing wrong with attacking your debts and doing a trip once you're debt-free. That's true. Yeah. That's true. Yeah. I'll be honest with you, Ryan. You know, I, there's part of me that I hear what you're saying about the wanting to honor what they would want, and there is something about a loss that you almost do need, uh, just a way to kind of unplug and

restart and sometimes taking a trip is the way to do that. Sometimes getting away from your normal environment to just kind of reset. So I'm actually not opposed to it. 3,000 is a lot of money. Maybe you do 2,000 or 15. Whatever you feel right about, I don't think that you're going to do anything reckless, but I probably, um, how old are you? I'm 25. Um, I'm not opposed to something like that because of the nature of the money and how you received it and wanting to do something

that you feel like is honoring to them and also maybe helping you heal too.

“Yeah. And I think, I mean, having, like during this entire grieving and kind of healing process,”

I think having my, I guess goals of, because I've been so aggressive on paying down the debt ever, I mean, I really locked in December last year. Yeah, before this even happened. I've paid, yes, I've paid like for federal loans off that were my smallest balances. And I just, I mean, there is light at the end of the tunnel for sure. And I know that if I really tunker down, um, then I can get out faster. Yeah, this rate, how fast will you get out?

Let's say through all the inheritance at these debts. You got 65 left. You make 65. What would you be on track to do? Um, the maps that I did with how much I'm paying extra on top of the minimums. I'd come out on October of 29. Okay. So we're talking about three years, which I mean, the debt to income ratio, I would have some urgency about this. Most people we see, it's like half their debt to income ratio. So they make 100, they 50k in debt. When I see someone making 65,

who has 65 in debt, I kind of get some palpitations going, we need to get this income up. We need to get this done faster. The average is about two years. So if you're far off from that, you know,

Jade had a story where she had almost half a million with her under husband. So that took seven

years. Ooh, it looks different for everyone. But I don't want you to get comfortable either gone well. I'll take my time. But I do love marking her legacy with some sort of trip. It doesn't need to be $3,000 trip. It could be a nonstop flight somewhere. And it's a solo trip where you get to kind of honor what she meant to you. So sorry for your loss, man. And we are rooting for you on this debt free journey. [Music]

The live like no one else proves is back. And for all of you who are living debt free, we want you to join us in the Western Caribbean. This is the only cruise where you can hang out with us and Dave Ramsey for seven days in paradise and join poolside chats, live Q&A sessions, and so much more.

Chats is what got me. You're not going to be poolside. The poolside chats? Let's get into it.

We'll see. It was a blast the last time we did it. And so we're bringing it back. And the ships over half way full already. The Neptune suites have already sold out. So locking your spot with a $600 deposit before it's too late. Click the link in the show notes or go to RamseySolutions.com/events. I'm going to work on my base tan. What was your favorite thing last time? I think watching Ken Coleman, who no longer are co-worker, but watching him play a pickle ball for about four

hours with a headband out there, that was the best entertainment money could buy. Oh, man. Oh, Ken. I'm going to hit karaoke pretty hard. And I expect to see you out there. Okay. I'll be right. It's going to be fun. Rob is in Greenville, South Carolina, up next. What's going on, Rob? Thanks for taking my call. I am looking to open the Roth IRA. And I'm just trying to figure out how to assess and figure out kind of what investments we've in that Roth IRA that I'm looking to do.

Great question. And a good call out for anyone listening. People think, well, I put money into my Roth IRA. I'm done. And I go, did you, though? Because it might just be sitting in like the

“settlement account in cash. And you need to actually go invest the dollars into something like”

a mutual fund. So we recommend four types of mutual funds around here. And essentially, Rob, it's large cap, mid cap, small cap, international. So we want a nice mix of companies to stay diversified. You've also heard of an S&P 500 index fund, a nice low cost, broad-based index fund. That's fine, too. But you don't get the same amount of diversification. Because an S&P 500 fund is just the top 500 companies. So you've got mostly large cap in there. So you're not exposed to the

smaller companies who might have some sweet, aggressive growth. And those international companies that help kind of bolster your portfolio when the U.S. market goes down. And can I do you want

better, Rob? So I give you, okay. Well, we're doing an event called investing essential,

September 1st and 2nd. It's a virtual event. And I'm going to send you a free ticket. You don't have to pay for it. If you'll actually attend it and watch it, it's Dave Ramsey and I for two nights unpacking all of this. And we actually do a walkthrough with examples of how to select mutual funds within there. Because with a Roth IRA, there's thousands you can choose from. It's overwhelming. So we'll show you how to narrow it down by process of elimination to choose the right ones

that work out for you long term. Okay. We'll hook you up with that. But it is, Jay, there's a lot of factors here. You want to be looking at how long has the fund existed? I was just about saying, what's there has been there for 10 years or has been a lot of turnover? What's the expense ratios? What's been the rate of return over the long haul? Yeah. And you can look that up. Whenever you're looking for funds, a lot of people want us to say, just tell me what fund to tell me

the ticker. And it's, we don't do that because I think it's great to learn. It's great to look it up, look up, look them up. Mine has, it's like a report card that you can look at or you can look at the perspective either way. But yeah, you look at how long has it been alive? You know, inception data went on. Around for a year or 50 years. Exactly. And then you can look at, you know, the past year,

five years, 10 years on down the line. And all that's really good to see. I'm always looking to make

sure it's at least like 11, 12 or beyond for, you know, average annualized rate of return, which is what we talk about here on the show all the time. And you can see all of that in the fund. Obviously, if you look in the past years, it's going to be really, really great. But the good news is there's so many that you don't want that it really narrows it down perfectly. If you start looking at that stuff, you'll be able to see really clearly, okay, this is, I see what they're saying.

Jade, as I do, I got an argument on in the comments section. Because this guy, you know, I say, hey, 10%, is what you can expect. That's the average, you know, the average is 10 to 12, let's go 10.

“Yeah. And he goes, what are you talking about? You need to plan for six. And so I message him,”

I said, hey, man, I'd like to know, like, where's this, where's that waste from? What are you invested in? So he literally sent me his portfolio. And half of it was in bonds. Oh, no. This kid's in his 20s. Yeah. And a bunch of it was in, you know, Canadian stocks. I think he's in Canada. And a little bit of it was in the US market. I don't, well, don't complain that you're not getting 10 to 12%, when you're investing like this. Yeah. It's not diversified. You need to be in mostly equities,

especially while you're, you know, to experience that growth. Yeah. Most people, and I still don't suggest this, but a lot of people do switch to bond funds when they get older because it's less risky. But bonds are volatile in their own way. And they're own like that. And then you're going to call me, go, and hey, I'm only getting 6%, what's going on? And I, when I look under the hood, I'm like, there's your problem right there, bud. So we're going to walk you through all of that investing

essentials that you can get your virtual ticket for that at ramsislusion.com/events. If you can't get it

“for free, like I just gave to my friend, Rob. But that's what he gets for calling on the show. He did the”

work. All right. Let's go to Nicholas and Pittsburgh up next. What's going on, Nicholas? So I'm struggling to do step one even saving a thousand dollars. I racked up quite a bit of

to pay a toll with like cash advances. And so I'm just trying to get to a good point, so I can

give the first step to save a thousand dollars. So when you say you're trying to get to a good

point before you save a thousand dollars, does that mean you're trying to get current on anything that's behind what do you mean by that? Yeah. So it kind of just does myself a whole sort of debt. I enrolled myself into a debt program about $41,000 worth of debt. Like a debt settlement relief company. Yeah. They tell you to stop paying the debts, tank your credit, pay us the payments, and then we'll

“settle for you. How long have you been in that? How much have you paid in? How much have they cleared for you?”

How much have they cleared for you? They take $300 out of every paycheck. Okay. And how much is that? That is going towards their fees. Right. So we're going to probably stop that immediately. Let's stop that program because and here's why whatever they're doing, if you wanted to do it that way, you could do it yourself. All they're doing is taking that $300, they're stacking up in a pool while you're not making

payments and every time that you don't get a payment, that gives them more leverage to settle the debt. And so at some point, they're going to come in and then try to settle it for, I don't know, a quarter on the dollar or whatever. If you wanted to do that, you could do that yourself and not pay the fees. So let's get out of that program immediately. And whatever they've got, you know, pooled aside, let them, you know, put it towards the debt or maybe they'll give it back to you either way.

“Get out of that. And let's talk about, are you behind on anything right now?”

No. All my bills are paid for. I just don't have much left over to start saving $1,000. What is your margin? When you do your every dollar budget, how much margin is left? Oh, I like to earn a dollar. Okay. So when we say baby step one, which for anybody listening,

baby step one is you get a $1,000 saved. Now, first off, the purpose of that $1,000,

it's not to be the be all end all. It's to be just a cushion between you and life. It really is a small insurance policy that ensures that you're not going to go back into debt. So if a tire goes out on the car, instead of putting it on a credit card like you used to do, now you can just pay cash for it, right? It's not going to solve all your problems, but it's temporary,

“and it should give you a lot of motivation to really work fast to pay your debt off,”

because nobody likes only having a $1,000 saved. So that being said, most people are able to do this, and this should be your goal to nickel this in 30 days or less. And that's not just with your normal cash flow margin. That's with you selling things. That's with you working extra. That's with you doing everything you can to get this money. Pausing investing, if you're doing any of that, just looking around for any creative way you can to free up more margin, whether that's spending less or making more.

So how much do you make? Yeah, 94,000. Amazing. And how much debt do you have total in the consumer

debt side? I have about 60,000 in student loans, the 41,000 in credit card debt, 30,000 in a truck payment, and then I also have my mortgage. Okay. Are you married or single, single? Okay. What's the truck worth? Only 22,000. Okay. That might be something you look into to come up with the difference through just saving up cash once you through baby step one. Could you get rid of that truck? That's almost a third of your debt gone, or at least a fourth, to free up some margin to then throw. Do you

free up that truck payment? Now we can attack some of these student loans, and eventually the credit cards, whatever the next smallest balances, hang on the line. We're going to give to you every dollar premium, which will help you find more margin, to help you with this debt free journey, my friend. Welcome back to the Ramsey Show, and the Fairwins Credit Union Studio. I'm George Campbell, here with Jade Warshaw taking your calls. Jordan is in Manchester, New Hampshire,

up next. Jordan, how can we help? I got a truck repair. I'm not coming out, but it's probably going to cost me about $1,000. I got through baby step one in the very, very early stages of baby step two. I have about $5,000 in a high yield savings account, and I'm just wondering if

high yield savings to pay for the repair. Well, either way, the high yield savings is just sort of a

“slush fund. What was that earmarked for? What was the high yield savings that earmarked for?”

Because we would tell you, just take the five and throw it at your debts. Obviously, of this truck repair, so let's use a thousand of that to cover the repair. Is the truck driveable right now? Um, technically, yeah, so it's got a really bad oil leak. Okay, like if you keep driving it, it's going to get worse. Isn't one of those situations? Yeah, oh yeah. Okay, yeah. Then I would go ahead and do the repair. I mean, it's why we tell you to have the $1,000

emergency fund. So even if you just had that, you'd be in the clear, then we'd tell you to pause, restock the baby step one thousand bucks, then move on to baby step two again. All right. So it doesn't really matter where the money comes from. You have six grand to your name. Let's cover the $1,000 repair and then get on to these debts. Okay. How much debt do you have? Right now, about, I think I just looked at it today, about 33,000. Okay. And what do you make?

Uh, about 60 to a year. Awesome. Okay. Is it just you? Uh, for my, I'm engaged, but we haven't fully combined our finances yet. Okay. That's good. You and you shouldn't yet until you get married. Uh, what kind of debt is the 33,000? Uh, so I have two personal loans out and then I have a motorcycle loan. What's left on the motorcycle?

Uh, do you have the under 16? Oh, wow. What's it worth? Probably right around 16. Ding, ding, ding, ding, ding, ding, ding. I mean, deal. Do we need to ride this for now? Can we get into this thing and free the payment? So that's, that's what I mean.

“So it's a change situation. That's how I'm getting myself back to port to work. Okay. So you don't have a car?”

Not right now. Now. So what about the truck? That I was, I wasn't driving it because I was afraid I was going to blow the motor. Oh, but once you get it fixed, yeah, we fix the truck and we sell the bike. I don't want to sell the bike. Thank you. Thank you for being honest because that's waiting for you to straight up tell me. I don't want to sell the bike. I like the bike. I bel. You know, it's, you know,

in the world of struggling a little bit financially. It's the one little freedom I feel like I can have. How fast can you have it paid off though? 16,000 and debt is not freedom. I know it feels like it when the wind's running through your hair. But that's half your debt, man. And you're about to get married. Yeah. What's more important? The future with this woman or having a bike you can go buy again later on? Does she have debt? I know. Uh, yes, but not nearly as much as I do. I mean, it's not a competition.

But that's the way I'd be thinking about it. I know. If you have 33,000 and she has how much? I would get probably

under 10. Okay. Okay. And that's a guess. So here's what I would do in your shoes.

I would have the conversation with her tonight. I would start having the conversations about you guys' philosophy on money. And now is the time because you know you're getting married. When's the date? Uh, 20, 28. August of 28. Okay. August of 28 is so far away. Uh, we actually just recently got engaged about a month ago. But I mean, it doesn't take two years to plan a party. It's a long time.

No, but one of the things that conversations we have started having is that we both want to be

“that free. But if you want to be dead free before the wedding you'd sell this bike yesterday.”

Right. Because now, then if I was her, I'd be mad. I'd be like, wait a second. I got to wait another year for you to pay off your bike. What if you could take any more debt? Does that

delay the wedding further? Okay. I'm just saying right now, basically you can ramp up or down

this wedding. And this new season of your life based on how aggressive you want to be with the debt. I understand. And I, like I said, I just started to babysit two and I'm putting as much as I can towards the smallest, my smallest debt right now. What about this? Let me play something out for you because I, like I said, I appreciated your honesty and your right. It sucks really bad to give up the things that we want, especially if we feel like there are things that we earned or we just have a

special attachment to them for whatever reason. That's probably the hardest part of babysit step two is the sacrifice of saying no to things that we would so like to say S2, motorcycle falls into that category. What if you sold the bike and then you paid off the 16,000 here really, really fast in the next couple of months and then you saved up to buy another bike again in cash. And you bought maybe, maybe, and maybe you bought more of the bike you wanted.

And that's beyond us, you could do all of that in way under two years. Which tells me there's another reason you guys aren't getting married for two years. How long you've been together? Just like a year and eight months. Okay, are you already living together?

the other side. So boys are no longer burning. If I can say that on the ring. Oh, that's fun, Jordan. We're having fun with you. We are. We are team Jordan. We want you to win and we're just showing you the best path forward. Now, can you do it a different way? Yes. Will it take longer? Yes.

“I can't force you to sell the motorcycle, but I think everybody listening to this is going”

sell the bike, man. Why put yourself in more pain than suffering for longer? When there's another bike, someone else is going to be in your shoes selling a bike for 16k later on down the road.

Well, that's the other thing is that later on down the road, we're looking at mine. I always

probably go up on a different people. We do that. How old are you guys? I'm 28. She's 29. Okay. You know, I think what I'm hearing is somebody who, it's weird. On certain things, you're like, we have all the time in the world. And then on the things that are less pleasant, it's like what we got to do it now. And I think that correlation there is on the things that are enjoyable and you kind of get the benefit of it. You got all the time in the world. Like, I can just

drive this, I can keep this motorcycle like we live in together. We don't need to get married, but on the things that are a little uncomfortable, but that really do require your attention. It's, you know,

we need to flip flop that a little bit. So I think that you're going to do what you're going to do,

but George and I would suggest if you really want to get out of debt quickly, if you really want to put yourself in the position to buy the house. And if you really want to do what you say, which is, let's each individually be debt free before we get married, which that's your

“prerogative if you want to do it that way. The best way to do that is let's get rid of bike.”

Let's show that we're serious about it. And that's kind of like you pushing all your chips in and saying, I'm serious about this deal. Do you think she would find it romantic if you're like, I'm selling the bike, because I value our future together more than this toy. Okay, she's going on it, too. Oh, she's she. So now she's the one blocking this from happening. She's like, no, I like the bike. She ain't but she ain't stopping me,

she hurts me. I'll tell you. I don't want to stop me. But it's, it's, I don't know. It's just something that we can do together instead of staying at home when there's, you know, I'm going to, beautiful. You're right. You're right. You can't leave the house unless you have

“a motorcycle. Here's the thing. Here's what I would suggest. I would suggest if you, you don't need”

to wait two years. You do not need to wait until all your debts are paid off. And if you both really truly enjoy the bike, you can pay it off together when your funds are combined once you get married. How about that? At least we agree. The one thing we should pay a thousand bucks for the truck repair. Yes, we do. I'm trying to find some silver lining in this call. We agree on that. , we agree on that.

Dave Ramsey here. For more than 30 years, I've been talking to folks on the air and I can tell you that most people are broke. Not because they don't make enough money, but because they don't have a plan, you need to give every dollar you earn a job because when you do that, something changes. You stop guessing. You stop worrying. You stop stressing. Our every dollar budgeting app will show

you how to find extra cash, pay off debt, and finally start winning with money. But most people

won't do it. They'll keep living paycheck to paycheck. Keep hoping things will change without making a change. It's time to say enough is enough. It's time to take control of your money. It's time to start your every dollar budget for free today. Go download it in the App Store or Google Play. Welcome back to the Ramsey Show. I'm George Kamel here with Jane Warshaw. We're taking your calls. Katie is in Raleigh up next. What's going on, Katie? Hi. So I am about to start a new job.

Earn more income. So my question is, should I take that extra money and then put that towards my student loans, even though my parents have promised to pay them off, or put that towards other things as me and my husband are wanting to start a family sometimes in? Wow. How much are the student loans? So there's two loans. There's one federal loan that is 30,000 and then there's one private loan that is 24 that they're willing to settle for 12. When did your parents say

It was just always a promise that they would pay them off eventually, but I just turned 30 and

I had been out of college for about eight years. And your name is on him? Yes, they are. Well, a promise with no deadline is just a wish. Just hope. So we need to get some real tactical facts here. Hey, I got 42k here to pay off. You guys said you would, I'm not going to let it sit in a crew interest knowing that this is under my name. So all the risk is on you right now

“and until they pay it off, you're carrying that. Who negotiated the settlement of the private loan?”

You were them. I have been, you know, and how it started is, my parents were managing it and then ended up defaulting. So I decided to take it over and I coordinate in front of all the payments.

So can we trust their word at this point? It sounds like they don't have the money to pay it off even

if they wanted to. Yeah, I'm certain to think that and they're getting close to retirement and they don't have a house and they're wanting to move into a house as well. So I think that this is just going to be a dead weight around your ankles until you cut it loose by paying it off. And if they want to reimburse you, I'd be like one day they want to write you a 42k dollar check. That'll be a sweet gift one day. But, and you can tell that. Based on everything you've told us, there is slim to no chance

they're going to pay this thing off. And what's going to happen is the loan is going to balloon. It's going to create resentment towards them and it's going to hurt the relationship even further. So I know it stinks because you believe them. You didn't take a whole lot of action because you thought, well, someone else is taking care of it. And now you're stuck on, I want to start a family. I got my own dreams and goals and you're stuck paying for the past now because your parents didn't

make it on a promise. So you have every right to be resentful and hurt by that. But you also have

responsibility to go, here's what's in my lap. I'm going to deal with it and I'm going to take this

raise that I just got and throw it all at the debt. And that might delay a few dreams. But I don't want it to stop you from having a family either. Yeah. And you know, my husband is in this equation now, too. I didn't mean until after college. So, you know, I'm just trying to balance all the

“different relationships. Obviously my husband is number one, so what do you guys make together?”

Well, what will you be making? I will be making 160 and my husband makes a little over 100 and from additional bonuses throughout the year. Amazing. So 260 and you got basically 42 on your side for the student loans. Do you guys have any other debts? Yes, we've just moved into a home with about a 500K mortgage and then we have two cars. One car has six grand left on it and the other one has 25. Okay, what are they worth? They're all pretty new, so you put a lot down. Yeah, we put about

5000 down for the 25K one. Okay. Yeah, I think that you guys have a great income. I think obviously the cars are not a huge piece of your world. So I'm fine with you guys paying them off. I don't see a need to sell any of them. But I do agree. You've got this deal with the private student loans. I think you ought to take it. Do you guys have any money saved anywhere cash? Yeah, we have our 10,000 emergency funds and then we have retirement and you know 401ks, rocks, but don't want

“to touch those. Okay, you said you have 10,000? Yeah, an emergency. So let's run this back because I think”

you guys are doing a lot of good work. But I think that you're not doing it in a very efficient order. And I think that George and I can help you be a little bit more efficient. Obviously around here, we teach a series of baby steps and the reason that we teach them the way that we teach them is because you're creating a foundation that you can build wealth off of that you won't have to go into debt. You won't have to, you know, tap into your retirement. You won't have to tap into

credit cards. And so let's see if we can write sizes with the baby steps. Obviously baby step one is you have a thousand dollars saved. That's just a quick cushion between you and life. You guys have that. You're good to go. But the next baby step is baby step two and that's technically where you guys are. That's where you list all your debt smallest to largest and you pay minimums on everything. But knock out, you know, use your margin to knock out the smallest debt. And then when that one's

done, you take the extra money throw it on the next debt. That is the debt snowball. And that's technically where you are. Right now you have an emergency fund which is baby step three. We suggest three to six months of expenses. You don't have quite that. But what you do have,

and put it towards this debt. You could pay off one of your cars. If you paid off the $6,000

car, how much monthly payment does that free up for you? That monthly payment for that car is

“$400. Okay. So now that's how the debt snowball works. Suddenly you pay off that $6,000. You”

got the $400. You throw that back into the mix. And now very quickly, we could probably gather up the money and pay off the settlement. How long is the settlement good for? It's every time I call them back, they seem to extend it. Oh, okay. That's good. So you've got a little bit of time. I think you can go ahead and pay off the car free up the $400. Stack up the $12,000 and do that settlement. And then next thing you know, we're on to the $25,000 car. And by the way,

beyond that, let's talk about that because beyond that is baby step four, we're we're investing

15% of our gross. Sounds like they're already doing that George. For the purpose of paying off debt, we suggest pause temporarily pausing. Go down to zero. And for you guys, that might be for six months. It's going to be nothing more over your income. But think about this. You guys make 260 gross. Is that about 180 net? I, I would say you're probably right on that. Yes. So let's imagine that's 15k a month coming in and let's just imagine your expenses are 9k. Okay. Now you have 6k left

over if you're doing a budget to throw it to debt. So if you do a J said, take your savings and pay off this 6k car loan. You're left with $67,000 total in consumer debt. If you throw $6,000 at 67k, you are done at 11 months. And that's probably not even making a lot of sacrifices. I mean, you're living pretty good on $9,000 a month. Yeah. So now let's go. Okay. What if you guys said, we're going to do it in six months. Well, now if we through 9k at this thing, we're done in seven

months. And so you can kind of figure out, based on the intensity that you guys choose, how fast we want to be at a debt. But if you're telling me, I want to start a family, that's going to be my fuel. To go, I'm not going to hang on to this for 12 more months. I'm going to free up all of those payments, stack up a big emergency fund. So when that baby's here, it's in a debt free house with no money stress. And you could save up a lot. If you pay off all this debt in seven months, maybe you could

do 60? Yeah, that you could have a nice cushy emergency fund in the next three months. So you've done really baby steps 1 through 3 in a year, which is fabulous. Yeah, this is very helpful. I was just confused about, you know, obviously if we're wanting to start a family, do I just keep letting my parents pay slowly pay it? But no, you've got the money to do it. You've got the money to do it. And we're going to give you the total money makeover. It'll just

“reiterate what George and I have clarified here for you. And I think it'll give you some of the”

wise behind the what that we don't have time to explain on this call. But you guys are doing great.

And what I love about this, let's picture one day. You make one 60. It's an amazing income.

Let's say one day you decide, you know what, this baby is I value being home with the baby more than my 160 income. You could walk away from it. If you do it the right way, you have the margin. You can you live off 100k with no debt. That's the question. Now you've got a $500,000 mortgage that changes things. You need to figure out in the budget what that looks like. But that's the goal of the baby steps. It's not to be maniacal because Jade and George and Dave said so.

It's to give you options, freedom, margins so that you can live out of your values instead of doing things because you have to do it because a lender said so. That's the goal.

“You should not feel uncertain about investing and you don't have to. That's why we created”

investing essentials. A two night virtual event where George Camo and I walk you through my playbook for investing and wealth planning will simplify everything from 401k's and mutual funds to passing on wealth. So you can invest with confidence. Take it start at $199. Get yours today at Ramsey Solutions.com/events or click the link in the show notes. Ask Ramsey's are free AI tool that's built and trained on proven Ramsey principles and

today we're going to break down one of the questions we received this week. Here's the question. People talk about Roth IRAs and 401k's. How do I know what fits my situation?

traditional. So that's kind of telling you your order of investing. Obviously if you have a 401k

“through your employer and there's a match, this is free money, George. I mean, you always want to”

give that out. I'm taking it. That's a no-brainer. It's a magic money machine right there. And then after that, you've got the Roth IRA. We'd love for you to max that out. That's fabulous because you're paying the taxes up front, which means you where your airs won't have to pay taxes. And of course, the growth is tax free as well. In 2026, the limit is 7500 or 8000. If you're 50 plus, you've got the catch-up contribution there. And then if you still haven't hit 15% of your income,

now we can move back to any traditional accounts. Like if you have a traditional 401k, you can contribute there. So that's the order. Match is the best. Let's start there. Roth is next best because you have this tax free growth. And then the traditional side to hit that limit. So I love this plan. I know it sounds simple. It can be confusing for some. So you can actually plug in your own numbers and ask Ramesy will walk you through the investing order for your specific

situation. You can do that at RamesySolutions.com or click the link in the description if you're on podcast or a YouTube. Brian isn't Dallas up next. Brian, welcome to the show. Well, thank you for taking my call. I'm actually calling for my son at the asking ceremony. My mom's finances. She's 94 years old. She has recently had to move into an assisted living facility. She's been a full-time worker into age of 93 and she broke her hip. She's accumulated like $500,000 in assets through

that time because of being further with money and she grew up during the depression so forth. Well, she's going to pay about $5,000 a month to live in the assisted living facility. And so she has enough to live for 10 years in the facility. However, we're getting ready to sell her house for about $150,000. My question is, what do we do with that money? Do we put it into our savings? Do we put it into a

“mutual fund? That she gifted some to her children? Do we start trying to move money out of her account?”

There's going to, because her assets are too high right now and she's not eligible for any assistance. But if that money was moved out, she would be, for example, my dad was a veteran in the Navy. She could get some military help that way. Just seeking advice, what we should do, particularly right now with that money. Are you saying for Medicaid purposes? Yes, I'm Medicaid and veteran purposes either one. Well, I know for Medicaid, there's a five-year look back.

And so you can't just move the assets out and go, hey, look, we're poor. They're looking for that. Because people have tried to do that in the past. And so that's not a great strategy. What I

would do is just go, okay, we know, I mean, if she makes it to 104, that would be pretty incredible,

right? Correct. But as she's made a lot for them, she has broken both hips, broken it on her neck, and she's just thriving right now. It's a great sound mind. Does she have sound mind? Yes. Oh, yes. Well, what does she want to do? Go here. What does she want to do with the sale of the house money? She basically leads it up to me and says, you, you do, you find out what's best. And so that's why decided to call you. It feels like investing it, dropping it in a mutual fund so that it can,

you know, have some compounding effect there and continue to pay for her life if you know. I might split the difference. I wouldn't put it all in investments because if the market takes a dip, now you're, you know, ripping the money out at the wrong time to pay for a care. So I would leave a huge chunk in a high-old savings account just as a buffer for her care. And then anything beyond that, you could invest a portion of it so that it's, you know, moving beyond just the rate of inflation

at three and a half percent. So if you left, let's say 400 K in a high-old savings and you put the

other 100 K plus 150 from the house sale. Now you got quarter million invested and 400 K liquid.

That feels like a good balance to me personally. Okay. So don't try to move any money out of her account that was. I don't think it's worth trying to move it out of the estate. It's not like she's a, you know, bajillionaire and there's going to be all these estate taxes. Here. And I don't think there's, you can look into the VA stuff. Again, I don't think there's any way you can just move money out. You know, she can gift money to you guys and avoid even the gift tax form of, you know,

third, you know, prime 19k year if she's single to each kid. But I don't know that it's even worth doing that when you guys will inherit it when she won day passes. And I agree with it. I kind of thought

“the same thing. That's what we thought we would do at first. But I don't know that we really have the”

time to move enough money out to where she can get in your assistance. Yeah. I, as assistance

wouldn't be the goal at this point. It's just how do we use this, this basically pile of $650,000

to make sure that we can cover her care without incurring any, you know, expenses on the kid's side. Yeah. I don't think she needs the assistance. If she needed it, that'd be one thing. But and she's probably getting better care right now with her assets than she would be with assistance.

If she was able to live this long. So what you're saying is take $150,000, maybe divided that,

but part of it in high yield and part of it in like a mutual fund. She already has some mutual funds. Okay. Great. Yeah. I was thinking maybe if you split it, 400k liquid, 250k invested. And I would connect with a smart investor pro at RamseySolutions.com. Because they can walk you through all of this for your specific situation. They know Texas law. And so they can walk you through all the appropriate ways to maximize these assets and make sure that we leave the legacy in the

right way with the state planning purposes. Okay. Thank you so much. I appreciate your advice. Absolutely. Thanks for the call, Brian. Man, that's impressive at 94. I know. She's sharper than I am. Oh, gosh. She'll outlive me at this point. Wow. All right.

“Anna is in Raleigh, North Carolina up next. What's going on?”

Hello. How are you guys doing? Doing great.

I just had a quick question. Me and my husband are under contract for a new build town home that will be done in November. We are pre-approved through Churchill mortgage with his great, but the builders preferred lender is actually offering 15,000 dollars in closing costs. But they are asking us to self-report our utilities and our rent to generate a credit score. And I just want to sure about that since it wasn't technically taking on debt, but I didn't want to mess around before.

We were trying to get a little another thing for this curious you guys have stopped. So they want you to turn in those kind of auxiliary things to generate because your credit score right now is zero. Yes, it's undeterminable. They want us to report it to the credit bureau, which is interesting. Not I was asking if it was just suned over to him and he was not like saying that was okay.

“Well, the problem with that is there's no guarantee that that's going to give you a good credit score.”

It might cause something to pop up. And I would hate if it was a mediocre credit score because then Churchill is going to be looking at you have a credit score. It has to be used. It's a stupid rule, but that's good. See, we either have to have no credit score or a good to great one. And so I would look into this to make sure that if you do self-report that it will give you an actual good score. And I would also look into these closing costs to figure out,

is this even a good deal? Because they could be screwing you in other ways. Because they always

entice you. If you use our preferred, you know, lender and we'll give you this kickback. Yeah. But that doesn't mean it's a good deal for you guys. So I would look at the numbers, get an estimate from Churchill, and look over those numbers versus the closing costs with this other lender. Okay. That way you're in full picture. Yeah, absolutely. It's a great question. That is. What they're talking about here is something called manual underwriting and or no score loan.

I've done this personally. People are shocked every time I say it. We've done it too. It's not that big of a deal. It's like a magic trick to like, wait, you did what? You can get a mortgage without having a credit score whatsoever. Now here's where people get it twisted. You cannot have a low score. This does not circumvent a bad credit score. So I get these messages going, hey, I heard you talk about these no score loans. How do I do that? I have a 400 credit score.

“I got no you can't. You need to get rid of it completely by becoming completely dead for”

you having no open trade lines whatsoever, no open credit cards. And after six to 12 months, your credit score will become indeterminable. So at that point, you're going, well, how do I get a score? Lenders are looking for this. Not all of them. And Churchill Mortgage who we've had as a partner for, you know, decades and decades now, they are, they specialize in these types of loans, because they help Ramsey fans get a mortgage without a credit score. So you do need things like

attacks return, you need to show utility bills, paint dust, rental history, on-time payments, all of that. But they essentially have a real person looking at all the numbers and go, yep, they call five to the loan. They use trade lines, you phone bill, utilities, electric to take the place of what other people would use credit for. Which, by the way, is exactly how it happened before the 90s. That's true. When the credit score came into existence. Yes.

So your grandma didn't have to deal with this. They just want, I know, Jane, she's great. Look, they have income, given the loan. I pine for us to come, go back to a time as simple as that's right. Where if you just have money and income, they'll give you the loan. If you pay taxes to the IRS every quarter or run a small business and you're not using a CPA, what are you doing? The more complicated your tax situation gets, the more you need expert help.

With a Ramsey trusted tax pro, you can get top-notch service year-round for payroll, bookkeeping, quarterly tax payments, and of course tax filing. Let an expert take the stress off your

Our scripture of the day, Proverbs 12, 15. The way of a fool is right in his own eyes, but a wise man

“listens to advice. Ken Blanchard said, "None of us is a smart as all of us." There we go. There's wisdom,”

in numbers, and community. Well, to two. Hey, buying or selling your home is high stakes because one bad deal could cost you tens of thousands and you don't want to overpay for your next house or sell your current home for less than it's worth. And that's where Ramsey trusted agent comes into play. We can connect you with vetted real estate agents who have the experience to guide you step-by-step to make smart decisions instead of expensive mistakes. Connecting is easy. You can go to RamseySolutions.com/agent

compare agent profiles, interview your top choices, and pick the right one for you. That's RamseySolutions.com/agent or click the link in the description if you're on YouTube or podcast. Kyle is in Charleston, South Carolina, up next. Kyle, welcome to the show. Hey, thank you for having me. So, uh, now life and I are both real estate agents. We've done about 180 this year on track to do probably

“360 by the end of the year. Wow. No debt except the, yes, thank you. Wait a go. No, thank you. Thank”

you. No debt except the mortgage. I want us to know about investing. So, we have enough right now to max out both our off IRAs. That would be, you know, starting our off IRAs. And then, you know, some on top of this, but you'll have to backdoor off IRAs at your income level. Okay. Yeah. So, know that there is an income threshold to do the Roth IRA, but there is a very legal loophole called a backdoor off IRA, where essentially you make an after tax contribution to a traditional IRA,

and then immediately convert it. Okay. So, look into that when you're ready. And I guess I kind of leads me into my next question. We're both 28. And I'm wondering, should we talk to a smart investor, because I've talked to some of them, just because I'm not good with all the stuff. I'm new to all this. Or should we do it at our own since it's just a Roth IRA, right? Well, you're going to be doing more than just a Roth IRA because the way we teach, we want you to invest

15% of your gross income, which making 360 thousand dollars a year, you could be putting away like $54,000 per year. So, the two backdoor Roths will get you to 15k. We've got a ways to go. And obviously,

you guys are basically self-employed. Yeah, pretty much. Do you run it as an official business

to where you could open a solo 401k? It's a LLC right now. It's going to be converted to a escort for the next tax year, though. Okay. I would contact that smart investor Pro and ask about a solo 401k. If it's just you and your wife, you can open one of those and what's really cool is you can contribute as the employer and the employee. So, you can contribute way more than I can in that 401k and that will really help you guys out. And you can even open a solo Roth 401k

to sock away all that money. And then you can also be on that. Let's say you guys want it to have some flexible spending money or a bridge account. Let's say you want to retire 55. You want to access money before 60. You can just open a taxable brokerage account and invest in there in some index

“funds and kind of create a nice little pile of money as well. So, and should we be investing?”

I guess should we be that 401k that you mentioned? How much is there a Mac on that that we can contribute as employer and employee? I think the lifetime match is somewhere around 54,000, which is right around where you would be after you do the Roth. The double check that for me

because it's always changing, but there's a lot that you can put in there.

Yeah, the total contributions are kept at 72. 72, there we go. So, you can contribute your 24 or five just like any old employee plus 25% of compensation on the employer side. Which is pretty great. And then after all that stuff, is there anything else we should be investing in other than that? I know you mentioned a brokerage account or mutual funds or the other thing is an HSA. If you guys have a high deductible health plan, I don't know what you guys do for health

insurance right now. What do you have? We actually don't, we don't have health insurance rate. Oh, boy, we got to get that right. New home work assignment is just flew to the top of the list. I would contact health trust financial. They can help you shop for insurance if you're self-employed to find you the best deal. And the website for that is healthtrustfinancial.com. That's a big one. Health insurance like medical bills are one of the leading causes of bankruptcy.

And so, that's really, you're exposed right now. So, as you're building wealth, that's the

and health insurance is, that's the top of the list. So, beyond that, you should be paying off the mortgage. You guys said you own a home? Yes, we do. What's left on that? Two, two, 20, I think? Fantastic. So, let's say you invest 15%, that's 54,000. And you still had money left over. Let's use a big portion of that to start attacking the mortgage and set a very specific goal of, hey, if we put five grand on that month that's 60k a year

and within four years, this thing's completely gone. Okay. Gotcha. And what's the, I mean, because we have our thing we've talked about paying off the home area a lot, and our thing is, you know, set a, and I know you're all here. This is a lot that I've tuned a half percent interest rate. Again, to convince any real estate agent to pay off the mortgage. So, if you do this, I will have a trophy in my house. But yeah, that's the thing,

people look at the paper and go, well, two and a half percent, I can make more and a high

“old savings account. The truth is, number one, we can only have that discussion if you actually”

have the full amount of the mortgage sitting in savings, which most people don't. And number two, you haven't factored in the interest savings. You have a forced savings plan here where the forced interest rate. So, that two and a half percent, you're basically making that money by paying it off. And now you can invest that payment. And people rarely factor that into play on top of, hey, what if your wife, let's see you guys have a kid in your wife's size to stay home?

Not having a mortgage, mortgage payment would really help out in lowering your expenses. Okay. So, it also gives you flexibility on top of the piece, the freedom. He said, I'll consider it. So, just consider it again. I flew by that, because I went, Kyle, this might fall on deaf ears here. There's on some rocky ground, but it's, it was born for shot. Because that is the truth. It's exactly what I did, Kyle, and I was zero regrets. I think my

mortgage was out, like, I don't know, a little over 3 percent. And my friends, like, come on, dude,

“you could make so much. Life is not about a spread. Once you have a family, it's about,”

how can I just live peacefully? Simply, not worried about money. So, my wife decided she wanted to stay home. We barely looked at the budget when he, all right, go for it. So, that's the advice there. That's the baby steps. You invest 15 percent until the house has paid off, then you can start really go and have. You can invest 30, 40, 50 percent of your income and start to go beyond into those taxable brokerage accounts as well. Okay, you got it. And one last question before I go,

they, after we, you know, say we do pay off the house after that, and we start saving up, we want to look at either, you know, six of our further investment properties or land, what's the old opinion on investing in those types of things? Love it. I mean, Dave Ramsey has a whole big portion of his network tied up in real estate. He's a big fan of it. But there's a very specific way to do it that, again, real estate agents rarely do, and that is

save up and pay cash. Right. And that's how we would do it. You know, the only one to do what, or what? Love it. And then it becomes, hey, what kind of hassle do you want? Do you like the fixer upper life where it's sort of temporary, but kind of high stress, higher stakes? And then you make some profit or do you want the sort of landlord life where, hey, we bought a property. We got a

good deal on it. Here's what we know we could get in rent. And when it's paid for, the cash flow is

extra sweet. Are you guys covering a real estate on investing essentials? We are. Okay. Let's give Kyle to take a car. So a night one of our investing essentials event, Kyle's happening September 1st in second, Dave Ramsey and I are unpacking his wealth playbook in the end of night one, we're going to cover real estate investing. So I want you specifically to tune into that and join us if you're willing. Yeah, even the, even the first night, too, because you, you had all those questions about

investing. I think that's just the perfect event for you. Oh, I love this Kyle. Join us. You just got a free $200 ticket. So don't say it and do anything nice for you. Even if you have a free ticket out of it. Thanks for the call, man. You're doing great. Great question. I can't imagine, Jay, that like it 28, maybe 360 grand crushing it real estate and having no consumer debt. I know they're going to be wealthy, wealthy, wealthy. Oh, I lit up like a Christmas tree to be able to talk about

investing because they have the margin to invest $54,000 a year. Unheard of. They're going to have so much money. They're going to be buying up properties left and right, like it's monopoly. Yeah, but you know, they, they, they, he started out saying something that I hear so much. I think people are like, oh, I just want to max out my Roth IRA and it kind of in their minds. It's like that's it. That's it. And don't give me wrong. I think that's a really good thing to aspire to,

“but the truth is you want to hit 15% of that gross. And if that puts you over the $7,500 limit,”

that's a good thing. So if you're married, making over a hundred k, you got to go beyond just two Roth IRAs. Yeah. You got to get into not just your Roth IRA, but now if you have an employer based 401k, go there. Yeah. And the HSA, that's why I mentioned it, is an awesome place to also invest kind of a life hack on that one triple track tax advantage. All right, that puts this

show in the books. Remember, there's ultimately only one way to financial peace. And that's to