Short-Term Pain, Long-Term Peace

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

So we're here to help you transform your life. From the Ramsey Network and the Fair Wins, Credit Union Studio, this is the Ramsey Show. I'm Dave Ramsey, Jade Washall. The Ramsey Personality number one best selling author is my coach today.

Daisy is in Austin, Texas, five days, how are you? >> Good, good. >> Good, what's up? >> So, and in there with so, I'm just calling on which I'll read out the question that I have right here.

So my husband and I are over one with financial, financially. We have in mortgage, vehicle payment, credit card debt. And the biggest part is the large SPA loan. They send it to a treasury, we're considering bankruptcy, and have also talked to some attorney.

They said, just did bankruptcy, do chapter seven, but we do want it to see what is our best option. What is our best choice we could do first? >> Well, asking a bankruptcy attorney if your bankrupt is like asking

a dog of its hungry, 100% of the time the answer is yes.

>> Okay, so, we'll start with that pre-supposition. And so, you're having a business that failed? >> Yes, so, the business is under my name. And then we, like, push it to my husband, and after that, like, it's just not going away with the business.

So, it's really hard for us to pay it off. >> What has it been closed? >> The business that was under my name, yes, it's closed. >> That's what the SPA loan was for. >> Yes, that's for the SPA loan curve.

>> And how much do you owe on the SPA loan? >> 178,000. >> And do they have a lean on your home or a soon? >> No, no, because I don't know, like the attorney that I talked to, they said, it's pretty much it's considered kind of like a personal loan,

because I was nine LLC or corporation. >> Oh.

>> Yeah, but they usually take a second mortgage position on your house.

You sure they don't have a lean on your home? >> No, no, because at that time, we did not have a home where we were renting. >> That's right. >> And you were able to get a mortgage after the fact,

“how much do you have to pay every month on this SPA loan?”

>> We were paying 584 each month or 30 years, but, like I said, we weren't able to pay it off, so we stopped and it's in treasury now. What kind of business was this? >> It's like calling, saying, I will, and don't talk, we have two right now that are right now working,

but like I said, the money is fluctuating. Sometimes there's work, sometimes you said you had a dump truck and what? >> Yeah, it's an end dump truck, so it's like 18 years. >> Okay. >> Where is it?

>> You said it's still an operation? >> Yes, that my husband, the one that's doing it now, the operation. >> And so what is owed against that other than the SPA loan, nothing? >> No, no, because we paid them off, we paid off the-- >> So what is the, what's the 18-wheeler rig worth?

>> So, let me have it right here. Okay, so there's a Peter Bell. It's that I looked it up and it's like 30 grand, and it was worth. And then we have a frontliner, it says it's 20 grand, but that one is not working. And then we have a, let's see.

“>> What's wrong with the one that's not working, how much would it take to repair it and sell it off maybe?”

>> Maybe like 10 grand or more. >> To repair it. >> And what other equipment have you got other than those two tractors? >> We also have, well, the other ones are just under his name, they're not under mine. But we have also a frontliner and that one, we got it for 550, but I guess the book says something else.

I don't, I don't remember how much my house does that. >> What is the one thing you can get for it? >> I don't, I don't know, I didn't, like he told me, but I just didn't stick in my head. I was just going to get my house done. >> No, I mean, did you say 550?

What? >> Yeah, because it was broken down, so he fixed it. >> My husband is very manual, he's not good at it. >> Oh, sorry, 550 dollars? >> No, 5,500.

>> Oh, got it, if your husband is good at fixing, can he repair the one that needed the $10,000 repair? Can he do that with his hands?

But it'll be like, seven.

>> What else do you want to get? >> We also own, to dozen and 18 arm a lie, and that's the end of, that's worth the 31,000.

“And then we have another trailer that is worth, like, 60,000, that's how much we got it for.”

>> Okay, so there's a lot of equity here that if you sold these things off, and got a job, you could pay your bills. >> Yeah, but, like, I've been trying to do the math and stuff, and we also have credit card debt. >> How much credit card debt do you have? >> My husband has $12,000 and has $6,000. >> Okay.

>> That's not very scary.

The credit card debt is not on your car.

>> Okay, so there's one car is $50,000, and that one he needs it for the, that might take, like, to haul everything. And he also has another side gate that is doing last gate, so he needs that one, and then we have every here. >> What kind of truck is it, is it just, like, F-150, like, a, okay, so, that is it, let me stop you. I, I've been where you guys are, and I know how scary it is, okay. But when you are calling about bankruptcy, you don't get to say, I have a side hustle with a $50,000 car.

You sell the stupid car and you get a job. So what I would do, if I woke up in your shoes, is I would sell everything you own, and you're not bankrupt, and get a job, he's got a CDL, get a job driving a tractor trailer. And you get a job. Have you got a job?

“>> Yes, I also work, and I have two jobs, for what do you mean?”

>> I am a pair of professional, and I make 26,000 a year, and then I work in another job, and that's, like, maybe, like, $3,000 to $5,000 on the side, because I do sometimes we get, and then the summer time I work more, too. And so, if he's driving truck and you're doing those things, whatever, the sale of all of these items doesn't cover, you can work your way out of, and so I got $50, I got $80,

I got $1, I got $90, I got $150 worth of crap to sell, $150 worth of crap to sell, and so the stupid car he's got, you guys just justify buying anything you want to buy on payments and call it, I'm in debt, but I can't sell it because I'm in business. Now, your business is broke, you went broke, you lost everything, and so you get the opportunity to start fresh with nothing by selling everything.

So when Treasury calls, and you owe 178, if you offer them 150 as settlement in full, because I've got that in the bank, because I've sold off all this crap, they'll take it, and you won't be bankrupt anymore. You're not bankrupt, you're just trying to hold on to everything. Yeah, that's, for me, I have to tell my husband, "I don't care, I can sell everything."

Listen, honey, they're going to take everything from him if he doesn't sell it and give it to them.

“That's how this works, including bankruptcy.”

When you file Chapter 7 bankruptcy in taxes, you don't get to keep $180,000 worth of stuff. That's not how this works, and I'm going to blow off all the debt and keep all this tractor trailers. Now they're going to sell all that at a bankruptcy auction and apply it towards your debt, so you might as well do it, and not file bankruptcy.

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Katie's in Savannah, hi, Katie, how are you? Hi, I'm good how are you? Better than I deserve, what's up? So, at the same time as my husband, I decided to take our financial health seriously. I also decided it was time to get physically healthy.

And I have lost over 50 pounds. Why don't you go, Katie? Good for you. Discipline, but get's disciplined when you do a budget, you can also count calories. The thing is when I was burgeoning, I forgot to save up foreclosed because I forgot

something that body was going to change. Yeah, thank you. And all of a sudden, I tried to get dressed and you don't have to fell off. Yeah, I can't wear any of my clothes in public while being appropriate. We are paying a large amount of money toward our debt every month.

Good.

“So, what kind of a budget do you need to buy a skinny clothes?”

Yeah.

I feel like it's reasonable to spend like 350.

I mean, but the only thing I can wear is my socks. Three hundred and fifty dollars. Three hundred and fifty dollars. One time. Probably just to get me through until we're done with the baby set we're on.

I think that's very reasonable, Katie, that you can do that. You can replace a whole wardrobe with 350 dollars. I think you're being real frugal. Yeah. I think that's excellent.

I'm very cheap. I do not buy anything brand new. But here's the thing. Part of the celebration. Just like when you pay off your debt, you get to celebrate by doing some of the things you want.

Part of the celebration of losing weight is buying the new clothes. So, you should do that. And I think 350 dollars is just right. Yeah. How much is your household income?

“Um, we're in the mid-100's probably about like 145.”

How much debt to go? About 15 less. Oh, wow, you're almost there. And you're going to have it done in less than six months. Wow.

And then after that, you can spend another 350 get the rest of your wardrobe. We'll see. I'm really cheap. I'm probably not going to do it again. Well, I want you to spend more than that later.

Do you have more weight to lose as well? Um, I have about 10 pounds left. And then I'll be able to healthy BMI. So, well, we'll lose more sizes. Okay, perfect.

But my long-term goal is to be and maintain a healthy BMI. I'm proud of you. That's excellent. That's amazing. I'll tell you what.

The people who really benefit the most from the baby subs are people like UKD who understand that it's a way of thinking that benefits you beyond your finances. It's how you can approach everything in life. And so, I am not worried about you. You've got it.

Yeah, you're going to be great. So, I want you to spend 350 now. And I want you to spend another 350 the day after you pay off your last debt. And then I want you to budget another 350 when you finish the emergency. Yes.

Because you got under the 10 pounds. You got under the 10 pounds and you're going to need some more clothes. This is fun, Dave. I like this. I know.

I know. This is great. You have saved. You have saved. You have saved.

You have saved. You're family in extra medical bills and insurance cost. Because your cost for your life insurance is going to go down. Your cost for everything is going to go down. You have saved your family.

Tins of thousands of dollars into the future. Buy yourself some clothes. Thank you. That's a payback. Okay.

It's a good honor. It's a perfect thing. Yes. And I got to tell you all. What you said is absolutely true, Jade.

The idea that discipline gets disciplined.

When we suddenly become powerful.

Yeah. Empowered in one area of our lives. We say, I'm taking control of this area. Then you go, wait a minute. And I can take control of that area.

And by the way, you children that are acting up beware because I'm going to take control of that area. Whatever it is, it's acting up in chaotic. We're about to take control of it. Oh, yeah. Oh, matter of fact, Christian, will you send your copy of what no one tells you about money?

“I talk about this a lot in that book because that's what happened with Sam and I.”

You start with your money. Then you start working on your marriage. Then you start working on your personal relationship with Jesus. Then you start working on your health. Then you start working on your career.

I mean, if you let it, it'll just unravel a whole thread in your life in a major, powerful way. Yep. You know, I really can't probably legally, legally, he's not the right word.

And good.

“I ethically tell people that when you get on it, get out of that plan that you're going to lose weight.”

But an amazing number of people do.

Not because they're starving themselves. But because they learn that they can control them. It's very intertwined. The methodology is is so similar. It's all about, you know, that short-term sacrifice, long-term gain, delayed gratification.

You know, all of those things. Once you activate that part in your mind, that's like, oh, I can do that. Then yeah, you can do it. And one definition of emotional maturity is the ability to lay pleasure for a greater good. Ding, ding, ding.

There it is. All right. Here we go. Denise is in Winston site. I'm hiding Denise.

What's up? Well, I just have either. It's going to be a public service announcement or you're going to get some advice. I have, um, I started a site hustle about three years ago. And Dave, I'm pretty sure that the seed was planted by something that you said about just looking around to see what you have available that you could turn to make money.

And I, and then, um, I was going to know I've been tremendously blessed by the property in a lot of about four years ago. And I had a, a swimming pool in the back. My kids don't live in the nearby and I would just see only one out there. And I thought, well, I've got this great asset. I should rent this out.

So I do it. And there's an out there was a, there's a business that runs an out that provides the platform. It was very easy to do to set up. I started, um, making money and making people happy. Rinting.

You can literally run your pool through an app, so on a hot summer day, if somebody's looking for a pool, but they want a private pool, they can use your pool. How much liability insurance do you have? Well, a lot. That was what I was personally ignorant of for about three years.

So they provided, um, a million dollar, um, liability insurance.

And I must say the platform. The app does. Oh, wow. Okay. So a million dollars a liability.

So a kid is back there and gets hurt in the pool. And you get sued for a million dollars. My property. Yeah. You get sued for a million dollars.

Then this app is going to pay out a million dollars. Well. Yeah. Okay. So what happened?

I. And I saw where somebody had mentioned that they only pay after your homeowners insurance. And I thought, oh, I didn't know that. So all this time, I've been liable because I thought, well, they'll just cancel me if I have a claim. Because also my homeowner's insurance, it says that I do not run a business out of my home.

That's true. And now you do. I don't, but for like three, three months out of the year. So I just if I did that, I really didn't get that much. But then I got, you know, I was going to be like, this is too risky.

This is really dumb. This is not worth it. So I would say so. Yeah. I think you, I think you learned a good lesson.

“The only way you could continue to do it is if you could just buy your own stand alone.”

And buy that from your local insurance broker. And it would not be attached to your homeowners. Like a separate business policy. Exactly. Exactly. And if that's not, if that's not so expensive, and I don't know if it is or not.

But if I listen, I call them thing under. Don't worry. I call them. Okay. And what did they say?

Yeah. Nobody's doing that. Not for a pool. Do you not, you probably don't make enough money? Yeah.

It's like four times more than what your homeowners would be. Yeah. And it's more than you're making back on the app. Exactly. Yeah.

Yeah. The first thing that popped into my head was somebody's going to suit your butt. As soon as you told me, that's the first thing that put in my head. It scared me. It scared me.

Here's the thing. Up until this realization. I was so, this feeling proud of myself because I was supplying this. Everybody, they're just family. It wasn't like I'm, they're wild parties.

Like I do see some of that going on through this.

That's true, but you never know what's going to happen Denise.

And I think that you caught this thing. You caught this thing. Yeah. You caught this thing. You dodged a bullet.

You dodged a bullet. Yeah. I'm not renting my pool.

“Even with Airbnb, you have to be careful.”

I'm going to rip someone my parachute. No, no. I don't think so. I scared me to death. [ Music ]

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And right now, you can try NetSuite next for free. If your revenue is at least seven figures, go to netSuite.ai/Ramsey. That's netSuite.ai/Ramsey. So, Jade! We're going on a cruise!

Oh man, this is so fun. The live like no one else cruise is March 14th through the 21st for seven nights in the Western Caribbean. Now let me tell you who should go.

“People that are on baby step four and beyond.”

If you're in debt and you're trying to in baby step two, not your house, but if you're in debt on baby step two, you don't need to be going on vacation. And if you haven't got your emergency fund, you don't need to be going on vacation. But we teach people to live like no one else. So that you can later live and give like no one else.

And so this is the so that crew. That's right. This is you reward yourself. And I know you've been holding your breath when you were getting out of debt, and now it's time if you're at baby step four and beyond,

to let loose and enjoy some of this money. We tell you to do that. We tell you to enjoy your money and move from intense to intentional at baby steps four and beyond. Meaning that you're all your debts except your homework paid off, and you have your emergency fund.

That puts you at baby step four. Now you're investing. Now you're enjoying. You're going on cruises with Jade and Rachel Cruise and George Camel and even Dr. John Deloni and Dave and Sharon Ramsey.

We're all there. We'll be hanging out with you on the cruise. We're going to do presentations. There won't be any dancing unless George does it on the, on the, on the stages. But the, but we will be in there with great information.

We're going to go through some, you know, some detailed things to do as you're becoming wealthy. Really get into wealth planning on this. The world's largest debt free scream will be there. And we're going to do live tapings of smart money happy hour of some of the other podcasts as well. It is going to be fun.

I'm excited. I'm strong. And there's just a handful of, there's some, that there is some good state rooms left, and there's some that aren't so good left.

Well, there's always the ones in the middle.

Yeah. The ones that the ones you don't want. But there, hey, you can still get a good place to sleep and hang out with us. And come on this cruise guys. Celebrate.

So fun. Celebrate. Some of you have been waiting to hear Dave Ramsey say, go enjoy your money. This is your, this is it. This is it.

This is it. I'm giving you permission. I'm giving you a directive. Come with us to Grand Cayman and CosML and Jamaica in the Bahamas. March 14th through 21 new wealth building techniques.

We're going to take some of the stuff from investing essentially. I was going to take some of that.

“The stuff was real popular, though, the night, I'm going to do some of that on the cruise, I think.”

Go into some of the estate planning things and how do I keep from some people when they start making money. They're, they worry about how do you keep from ruining your kids. You know, how do you, how do you make them grow up and be functional? Well, we're talking about that. Rachel Cruise probably got something to say about that.

The nurturing of her mother, the harshness of her father and all that, right? Perfect lens. Perfect blend. Hey, baby step four and beyond you are officially directed to go to the website and get the live like no one else cruise.

Ramsey Solutions dot com slash events. Book your cabin before they're gone, they will be gone. Now listen, it's after Labor Day. All you people that have the summer in vacation.

Now March is going to be hearing about 20 second.

And hold your cabin. Yeah, that's it.

You can do that and baby step four.

And now you can afford it because you're not broken anymore. I love it. Looking forward to having you guys going to be fine. Lee's in Salt Lake. How are you?

I am good. Thanks for you. Better than I deserve. How can we help? Good.

I am a single mom. I'm 29 years old and I have a four year old son. I left an abusive relationship about four to five years ago. And it's just been me and my son. I homeschool.

I've been working remotely for the past three years. And my job just announced that our company is shutting down. And then I have about three weeks left. I have no debt. I'm on baby step three trying to be on PV step three.

I don't only have about $2,000 in savings. I've been applying like crazy. I probably put in a hundred applications as past three. Just trying to find a remote job. But yeah, I was just calling to get financial advice.

Like what I should do. I'm just afraid because I don't have a lot of savings. You know, we'll go home. Where are you? I don't get a job.

I was only getting a 2400 a month. Okay. And you've just been applying for jobs that are just out there.

“Have you reached out to people in your community and your network?”

And said, hey, good looking. Do you know of anyone? Yeah. I tried to ask all my friends. I'm looking for a remote job.

Why are you looking for a remote job? I was going to say, when you say only remote, you're narrowing your pool so small. Like 90% of the job just came off the table. Yeah. Yeah.

It's because my son is still home with me. Yeah. Do you have family in the area? Uh, I don't. Where is your family?

Uh, they're in Arizona. Okay. You may be soon. If you had a in-person job where you made double, could you do daycare?

Yeah. Possibly. I just, like, if I can, I prefer to home school. I prefer you not to starve. Yeah.

I know. You get thrown out of your rental house. You're in for a daycare. Yeah. I prefer you not get thrown out of your rental house and not have food.

That's the first thing.

We have to survive first.

Then we can work on preferences. And you've got the views burning on a stick of dynamite. You've got three weeks as long as the views is. And then your world's going to blow up. So yeah, you don't prefer no longer available.

“I think you've got to put in for whatever's out there, including in person.”

And I think I heard you say you had a bad experience with daycare. There's, there's really great daycares out there. And my guess is that if you are making 24, you might have scrimps on the daycare that you were going to. But if you have a little bit of a higher paying job, you might be able to look at some nicer facilities. Is that fair?

Yeah, I was making about $17 a my current job right now. So I just not share how much more. Yeah, you're starving. You're starving today. It's good.

I think it's because you've narrowed your pool so far. I think that if you go out and you're looking at in person jobs full time. What's, what's your area? What's your area of expertise? What do you and your field?

I have a bachelor's in hospitality and tourism management. You're a four year degree in hospitality and you're making $17 an hour. Yeah, you ought to be able to get out. You ought to be able to go manage a hotel or manage a restaurant or get in line to do that. And make a lot more than that.

I think you've just narrowed your pool. I know I've said that. But I think that you're so tunnel visioned on taking care of the four year old.

“The truth is he's going to be in kindergarten in a year anyway.”

Yeah.

I think part of my problem too is that like I just always wanted to be a stay home on.

And so that dream of homeschooling I have. But yeah, financially it's just. That's the hard part. So here's the thing. You've got competing priorities because you've got this value of wanting to be a home school.

Then you've got a priority that really is a responsibility of bringing in enough money for your family. You're the sole sole provider. And so when that happens, sometimes you have to reorder your priorities. Even if it's temporary in this season, you're going to have to prioritize earning money for your family first. And the hard thing with priorities is everything wants to be number one.

But that's just not reality. Math says that earning money at a career has got to be number one. And just remember, it's for a season Leah. You might pop back and be doing so well that your season changes and you're able to shift in some ways. We don't know what that looks like.

But just think everything is in seasons for life. It doesn't necessarily have to be like that forever. You've come through an extremely emotionally damaging process.

And just trying to make sure the child is okay and surviving. And you're being a good mama bear.

“And you're putting your arms around your baby.”

And that's noble. And that's exactly what you should do. We're not in the middle of all the emotion of your former abuse. And so we don't have that. Oh, we see is is that our friend Leah that we love needs to get a job so she can feed herself and her baby.

And that's first.

All the other stuff is second.

And that includes remote work is second. [Music] This show is sponsored by Better Health. I know a lot of you out there are trying to keep it together all the time. You show up to work.

You pay the bills. You smile at the right times.

“But then no one sees you snap at your spouse.”

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trust a Better Help Therapist to help you carry the load. Go to betterhelp.com/Ramsy for 10% off. That's Better Help, H-E-L-P, dot com/Ramsy. Amanda is in Jacksonville. Hi Amanda, how are you?

Hi, I'm so excited to talk to you. You too, what's up? I need help convincing my husband that the mortgage tax benefit doesn't outweigh paying off our home tomorrow. Do you guys, do you guys actually item us? I know, I was just whatever to a road tax.

No, there is no mortgage tax benefit unless you item us. And only about 4% of Americans item us. You know, we do not.

You do not have a mortgage tax benefit.

No, it doesn't matter whether you listen to me. You do not have a mortgage tax benefit. If you do not item us, nor do you have a charitable deduction. If you don't item us. Because you're taking the standard deduction and the standard deduction,

the standard deduction doesn't allow you to list off other things that you want to deduct on your taxes. Instead, you take one deduction, the standard one. And you wave the others, which are smaller anyway than the standard deduction. So you're probably not itemizing, so your mortgage tax deduction's mythology. It doesn't occur.

You don't get one. Okay. So you have the money in the account to pay off the mortgage? Yeah, we have 235,000. And our house is 94,000.

And why does he like being in debt? Well, we met with a financial advisor like an intro meeting. And she was trying to convince him that we should invest that instead of paying off. Oh, you need a different financial advisor.

“Yeah, you need to go to smart investor pro at Ramsey Solutions.com and find someone that has a brain.”

There is money. I mean, it almost feels like you could do both. And maybe that's the way you approach him. There's $234,000 sitting there in savings. You take the 94 and pay off the mortgage.

You take another chunk and invest it and then keep your three to six months. Is that? Is your three to six months included in that 234? Yeah. Yeah.

That way everybody's happy. He gets to invest a little. You get to pay off the mortgage. And you've still got your stack of cash there for an emergency.

That sounds good. If he listens. If he listens. If he listens. If he listens.

“That's the, you know, we've done all the other things.”

We invest in our 401ks. Our kids have their Florida 3P plans set up. They have their own checking account. What's the mortgage payment? What do you pay every month on the mortgage?

It's about 1,200. That includes taxes. Right. I mean, and this other thing. I mean, I would sit down with him tonight.

This is, if you, if I were in your shoes. I would sit down and I'd say, here's the money we have. I would like to do this. Pay off the mortgage. And then once the mortgage is clear.

Whatever is left. Let's say I don't know what your taxes insurance are. Let's just cut it in half. How old are you guys? I'm 39, you 43.

Okay. Let's say, let's take $600. And let's start investing that every single month along with the extra cash that's sitting in that account. And over time, Dave, do you have it in there? Well, I just put $1500 a month for the next 25 years.

Okay. Which puts you guys into your 60s. You'll be 65. It'll be 67. Okay.

So 1500.

Your house payment plus a little bit is 2 million.

And then, 364,000.

“That's what that house payment's costing you.”

Yeah. So anyone that tells you to keep that house payment is a mathematical moron. For a tax benefit that you're not eligible for anyway. Yeah. Let him listen to this call.

Yeah. Play this for him because he's wrong and we're right. And his financial advisor is not giving a good advice. They make, they don't make commission on the amount you're used to pay off your mortgage. They only make commission based on what you buy with them.

Ding, ding, ding, ding, ding, ding. So there's a little conflict of interest in that advice. I will actually defend the financial advisor and say it's probably not his motivation. He probably just believes the lie, a lot of people believe. But what we know from having done the largest study of millionaires ever done in North America.

10,167 of them.

The typical millionaire in their first one to five million dollars of net worth that we found.

Like 80 to 90 percent of them fall in this category. Have a paid off home. That's worth six, seven, 800,000. And they have money. It's gone into their 401(k), this worth six, seven, 800,000.

Those two numbers added together are a million to two million dollars. And that's the typical person that does this. The number of millionaires, not broke financial advisors with an opinion. The number of millionaires who said, Dave, the reason we became a millionaire was we didn't pay off our house. And we invested the money instead.

And that caused us to be a millionaire. The number of 10,000 millionaires that said that was zero. Can I ask another stat?

“How many people in all your years on radio who you have guided to pay their mortgage off?”

How many have called back and said, Dave Ramsey, you fool. I paid off my mortgage. You ruined my life. I can tell you that there are entire websites devoted to hating me. And the entire segments of Reddit devoted to hating Dave Ramsey.

I mean, type in Dave Ramsey sucks. It goes on four days.

Never will you find a single person that said, Dave told me to pay off my house.

And I hate Dave for that reason. Not one. Not one. No one regrets it. If Amanda, you all pay off your house.

And you hate being dead free, you can go get a new mortgage. And get back in debt. But I've never heard anyone do that. I've never seen it. I just woke up and I just felt all clammy.

And I anxiety and I was having a panic attack. And it was four o'clock in the morning because I don't have a mortgage. No one has ever said that. And so I had to rush down and get me a new mortgage because I just couldn't have peace. When I was completely dead free.

No one has ever said that. This is this is if you think about it, it's kind of freaking common sense. Until some goober tries to put a half-but math formula to something that left out all the other aspects of this. Yet the number of people who said, you know, I got a divorce

because we just couldn't get along after we paid off our mortgage. The paid off mortgage was the end of our marriage. That was zero. No. Nobody.

Not a none.

I mean, that's a big stat. You've been sitting in this chair for a long time. Almost 40 years. Yeah. I mean, it's just like, and there's everyone hates me for some reason or another.

Except that. Except that. That's a good point. That's just very interesting. You know, now the people that live in a test tube and they want to argue

“about concepts, but I'm talking about that they all hate me on this because they are the financial planner that this guy went to, right?”

But the people who actually did it never from, you know,

cut up your credit cards and pay off all your debt. I've never even had anybody get mad at me that actually did it for that. For that. For that. Dave, I hate it that I paid off my car.

I feel hate you, Dave. I've never had that one. These are not things we get. We get a lot of hate. But a lot of it is from people that have been drinking hatred. Yeah. And they're just stuck on some, they don't want to do something or they don't agree with it, but they've never done it.

That's right. So they really don't have the experience. If you've ever actually been a hundred percent debt free, if you've had the unbelievable thrill of placing scissors across a credit card. And saying take that city bank, discover this.

I'm done with American distress.

“And if you've ever had the pleasure of a plastic to me,”

I promise you, you will never go, oh, I so miss my credit card.

You know, those airline miles. I can't fly anywhere because I don't have any airline miles. No, you can go anywhere you want to go because you got money. And no blackout day money. You know, all those airlines, they take money.

I know that's right. That's the thing. And so this is how this whole thing works. That's so fun. That's a great question, Jay. Thank you. Yeah, it's just to enter it. It's so, it's so humorous. It is.

When I run into somebody, I was at a restaurant this weekend. We stopped in Lady came over the table and she said, thank you. And, you know, she's someone who actually did it. She's not someone who talked about the theory of it. Yeah.

That's the difference. That's the difference. That's the difference. Hey, George Campbell here. Listen, if you're behind on dead payments and drowning in debt, I already know what you're thinking.

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[Music] Welcome back to the Ramsi Show in the Fair Wins Credit Union studio. I'm Dave Ramsi, Jade Washall, Ramsi personality is my co-host today. Hazel is with us in Salt Lake City. Hi Hazel, how are you?

Good, how are you? Better than I deserve, what's up? I am just wondering what kind of advice you have for blended families. I have three teenagers from a first marriage and I have two toddlers with my co-hosts.

And my older boys dad does not like to pay his portion of the bills and it makes. My husband really upset so much so that he then has a hard time wanting to pay anything for my older boys. And I am totally supportive of having joint accounts like you guys teach. But my husband just hasn't wanted to do that since marrying we've been married for almost seven years. And now I'm wondering if that's even a good idea because I find myself like paying for a thing for my account and not telling him what I know.

I shouldn't be doing but also like I have to pay for things, things when it comes to my older kids. I'm just looking for some advice. The three teenagers they're in the house, they're not like 18 and 19, right? They're in the house?

And so when you say he doesn't want to combine money, it's not just...

He doesn't want to pay for those things. He doesn't want to pay for the fact that you have kids. And how did you all not discuss this before you got married? I know. Well, we did. That's the thing that I have a hard time with is he was had a different attitude before we had our own children together.

And since having his own children in the house like the attitude has just been so different towards my older teenagers. So he even treats the boys different, please. To me, he does. When he is with them face to face, he's kind to them. But when it comes to like paying for sports, paying for school, just things that like parents pay for, it just causes an argument every time. Yeah, you don't have a combining money problem.

And you don't have a who pays for what problem, you have a marriage problem. Yeah, I had a feeling not so you were going to tell me.

“What's the best way to talk about this with him?”

With a mediator in counseling.

Okay. And I would talk to him about it tonight. I would say the more I've been thinking about this, we've got some issues in our family. And I think you and I need to talk about them. And I would love to do that with a counselor because I think they can give us an unbiased look at what's going on and offer some unbiased advice to us.

And give us some tools to work through this because otherwise, this is not going to go well. Because if you make me choose between my boys and you, we don't want to have that choice to have to be made. And you're starting your forcing me to do that and I'm not going to do that. It's not what I signed up for, it's not what we agreed to before we got married. And now it's come up again and again and again.

And now I feel like I'm having to sneak to take care of my own children. And that ends today. Great. Okay. Yeah.

Okay. I appreciate that. How long have you been married? Um, next month, it'll be seven years.

“So you want to, you want to, you want a prediction?”

Yeah. It's going to be okay. Okay. Because I think as soon as you call him out and he sees what he's doing in the mirror, he's going to stop because he's a good man.

Yeah. He is a good man and that's my prediction. I just don't, I don't think he's seen himself in the mirror lately. And this discussion, this discussion with a good counselor puts a mirror up in front of this behavior. And I think he'll stop.

So I want to add this in, and I may be wrong, but you've been married seven years and you've got two little ones. If this just started when the other two were born, my guess is it may not have much to do with your boys and it may have to do with him feeling like he can't provide for this family. Okay. And so are y'all coming up short on money? No.

No. He makes good money, we have decent savings. I actually don't know really what he's got in his like for a 1k and a draw.

And he's always just kept that separately.

He's always said like, "Yeah, we should combine it." But we never did. Yeah. But that this little bit of secrecy on your side and on his side both is starting to, is starting to really cause. It's going to grow into a problem unless you nip it.

You guys need to come clean and say, "We have five children in this house. We are going to care for as long as they are in this house. We're going to care for them equally and totally both of us." And we are going to disclose 100% of the financial transactions in this house and all the passwords to everything starting now. That's a real marriage when there's that level of trust.

And that level of alignment on our goals and our visions. It's going to increase the quality of your relationship to no end. But you guys got some sandpaper to get there. Absolutely. It's going to get some rough edges knocked off to get there.

And so that's the direction. Yeah. And Hazel is like, "I know you were going to say that. Well, we're fairly predictable around here." Yeah.

“And honestly, and I know people are afraid of that.”

But that's one, I feel like that's one of the great benefits of marriage. You've got this other person that you can be your 100% self, that you don't have to hide a bunch of things. You don't have to hide who you are and the things that you're struggling with. You have a person.

That's the whole point. Yep. It's, yeah. Crazy. Yeah.

I think he's just, I think you were maybe there's a sense of scarcity.

I think something's going on there. And he's like, "Come on, man, take care of your kids." Amen. Amen. But in the process, he's not a man.

Yeah. He's just taking out his feelings in the wrong way. And I really do think that I think-- I've got a feeling this is a good guy. Yeah.

I really do. And I call you out if you're not believe me. I'm pretty quick, especially somebody being a worse. Yeah.

But this guy, I think he's good too.

“I think he's just got to have some clarity here.”

And you know, some exposure therapy. You're exposed yourself to yourself kind of thing. Like, "Oh, look at who I am." I don't like that. I don't think I am that anymore.

Ready set go. And therapy is a good thing. I think all couples need to visit the office of a counselor here and there. I think it's a good practice just to make sure that everything's going good. You know, what you want to do on a bad time?

We've been married 44 or 45 years almost. And with 10 years, we went bankrupt as seven years. And we didn't kill each other then. But we didn't have the money to leave. So we just kind of stuffed everything.

And about three years later when I started making money, all that stuff kind of wrecked it. Yeah. I'll start coming out.

“And so we ended up in the marriage counselor's office.”

And I thought it was so that, you know, the murder didn't occur or something like that, because I was afraid she's going to kill me. And but what it ended up being was, it was like going to a personal trainer.

They teach you the right way to do the exercise. That's right. They teach you the right nutrition. The right tools to win in that area. And so I looked, I looked at it as I was just going to class.

I had a personal trainer. That's right. For relationships. And man, I got a lot out of it. It's so helpful.

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Well, we wish we could get to every call and the question here on the show. We can't because you can't get through all these phones. Sorry about that. If you have a money question and you want to answer for your situation head on over to our website and use AskRamsy, AskRamsy is our free AI tool that's built and trained on proven Ramsy principles.

You'll get an answer the same way we'd answer it right here on the show. Ask your question today at RamsySolutions.com or click the link in the description if you're listening on podcast or YouTube. Evelyn is in Knoxville. Hi Evelyn. How are you? Hi. I'm doing great. How are you guys?

Better than we deserve. What's up? So I'm a little bit of an impasse right now. I'm trying to figure out if I should go back to work full time right now or just wait it off.

To go back to the full time force right now.

I'm doing a part time job. Evelyn's while I stay home with my daughter during the day. Okay. So you're considering going back to work because you need more money or because your daughter is getting older. Like what's causing you to hit this crossroads? Yeah. Good question. I got a call from former co-workers.

There was a position available soon and my husband and I are maybe set four. So we are trying to right now do the best that we can with our income. We don't have a very high income. And he's trying to find a job right now that pays more. And yes.

If you're if you're telling me we don't have a high income and he's not working much in your working part time. I am looking for I would be looking for a full time job.

“What how much are you guys bringing in every month?”

Oh no. He is working much. He's working full time job. He's just not making as much as he wants to. What do you make? What do you make? 50k.

Okay. And what can you make at the new full time gig? 50k. And the trade-off is that you currently make how much? At your part time? Yes.

Because it's a server position to pay so it would be about 20, 25 grand. Okay. So you can double your income and you have one child and the child is how won't. Two. And so the child would be in daycare. She's two.

Did you hear that? She would be in daycare then, correct? If you took the job. So the trade-off is, do I want to put a child in the daycare? My child in the daycare, so that I can make $25,000 a year more.

Correct. Yeah. And that's where I'm at a bit of an impact. That's not an impact. It's just a decision. Neither one is the wrong answer. You're in baby step four, is there a reason

that you need the money? Does your mortgage fit within what you earn part time? Now the mortgage fits before we made. We both had an income. The mortgage does not fit into the income.

Okay. Right now the mortgage went up. So we're at a 14, 56, a month. Okay. So do you, if you don't take the job, can you stay in that house?

Yes. The way that we're making it work. So basically we started. I started aggressively putting money towards the, not me sorry.

This would be two guys aggressively. And then because of that started putting lots of money into the mortgage. So this is the first month that we're kind of taking a step back

just to invest because we were not investing the 15 percent.

We were just wanting to be done with the mortgage. But that will take a while. So we are trying to figure out. I still think this is high for you. Because if you're telling me he's bringing in after tax around 34.

Is that true? Um, no, so you'd be 2800. Okay, even less. He does have a pension. No, no, no, just after tax dollars.

After tax.

“After tax you should have around 33, 34 a month.”

Yeah. And then you, with the, with the 2500. I mean, what are you bringing in 1500? If that. Uh, it's about 2,200.

Is the average or the median. Okay. Okay. I mean, it's, it's about 5,500. Yeah.

Okay. It's tight. But you can make it work. I see what you're doing. So it does come down.

Okay, we can make the housework. We can make the housework. So the only question is, do, at this stage, do we want, do you want to work full time? I and not have the server job.

Um, and, and your child will be in daycare. There's neither one is a sin. Neither one's horrible. It's a personal choice. Okay.

If you tell me you were going to make 10,000 more, you're going to spend that on daycare. So I wouldn't do it. Right. But you're going to make 25 or 30,000 dollars more.

And his income's going to go up.

“So if you want to go back to your career,”

back to your old company, that's fine. But just because they have a position available, doesn't mean they want to have one later.

You could say third option is,

I'm going to continue like we are temporarily. And maybe in two years or three years, when junior goes to kindergarten, maybe then I'll go to full time. Yeah.

Because daycare won't be quite as expensive. When I've got a day, when I've got school. So anyway, that all of that. And so you just got to work it through that way. And decide, I don't think there's a wrong answer.

I don't need there. And I like what you said Dave,

does this still feel right?

If it does, keep going. If it doesn't, you make changes. You know, that doesn't have to be. That job is not the only job.

“And it's not, might not even be the only time.”

That job is there. That's right. So I'm didn't even ask what the field was. And that might have even added to that. April is in Atlanta.

Hi, April, how are you? April. April. April. How are you?

One more time. April. April. Three. Two.

One. All right. We'll go back. Karen is in Oregon. Hi, Karen.

How are you? Good. Thank you. My question today is I'm 61.

“And I have retirement money and I put it.”

I'm no longer working out of the house. I'm taking care of my mom. But I went to a fiduciary at our credit union. And he put it in sucks and bonds. And I feel like they're too risky for my age.

Just I started last year. And I've been losing every cent. I know it's a long term thing. You've been losing in the last year. Yeah.

Well, it's not too risky. It's just the wrong ones. It's awful. How much did you start with? How much do you have now?

Well, um, it started with about 84 and the first quarterly thing I looked at.

I lost 5000. Which quarter? The first quarter of this year? No. It would have been.

I put it in like July last year. And then December when I got my first statement. I had lost 5000. How much do you have today? Do you know?

I would say I'm down 8,000 from the 84. You guys, the world's worst picker of money. It's the world's worst picker of funds. He's the world's worst picker of funds. While you've done that, I've been a 100% growth stock mutual fund.

And I've almost doubled my money while you lost 8,000. No, okay. And I'm 66. No. My husband also went to him and lost money in the first thing.

Yeah, so the long term thing. No, it's not a long term thing. You don't do long term when the market is going up and your investments are going down. You don't do that long term. That's just immediately over.

Do not pass. Go. You're fired. Yeah. Go to RamseySolutions.com.

Click on Smart Vester Pro. And pick out a smart Vester Pro that you can sit down with. That has the heart of a teacher.

And never again put money in something because someone else says to do it.

Because you understand it and you select it. Yeah, if you pull up, Dave, you always have that S&P 500 thing. If you pull up that and look at it, you can see the fact that you've lost apparently Quarter over a quarter and $8,000 year to date is crazy work compared to what the stock market is actually doing. Yeah, I see it's a 12.24.

It's up today since the first of the year. Year to date. It's up 12% since the first year. That's not an $8,000 or less on 84,000. That's a $12,000 and $8,000 gain on 84,000.

That's right. That you should have had. And that's just if you only did what the S&P did. And which means he's got. That's all.

Yeah, that's not doing well. Yeah. Horrible. Scary. Hey, guys.

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Jay, I talked about this a little bit the other night on the investing essentials.

“And after our last call, I'm going to talk about it again for just a second.”

All right? Conventional wisdom isn't. It's not wise. If you follow conventional wisdom on the average diet in America, you will be obese.

If you follow conventional wisdom on the proper way to be married, you won't be long.

If you follow conventional wisdom, you would get a credit card when you turn 17 or 18 so that you can build your FICO score. Why? So that you can borrow money to buy a car. Why? To build your FICO score so that you can borrow money to buy a house.

Why?

So that you can build your FICO score to make the bank's rich.

Because your FICO score is not a measure of winning with money, but conventional wisdom says to build your FICO score. Conventional wisdom also in the financial planning world says that as you get older, you're supposed to move your investments to less risky. And if you read anywhere on the internet among the stupid thousands of articles that are out there, they teach a thing that the financial planning industry has called conventional wisdom called the asset allocation theory, your asset allocation model,

which means that you allocate more of your assets to bonds and money markets as you get older so that you are safer. That is conventional wisdom and conventional wisdom isn't. Here's why. As you move your money from good growth stock mutual funds into bonds, they underperform dramatically. As we told the last call or year to date on the S&P 500, my stock growth stock mutual fund in an S&P has averaged 12.2%.

“Do you know what the bond market has averaged since the beginning of the year?”

Less than 1%. Oh, gosh, I was going to guess higher. That's bad. And so she calls up and says, I have followed conventional wisdom and my fiduciary, which is a funny term for someone that's supposed to have your best interest at heart, but used conventional wisdom and screwed up everything. So this bows out with the credit union, put her into bonds, some equities, and some cash, which is what conventional wisdom says to do when you're 61.

And so she's lost $8,000 when she should have made $8,000, which is a $16,000 swing, which is somewhere around 25% on $84,000. That she's off because she followed the advice of someone who is giving conventional wisdom. Conventional wisdom is what normal people, everyone believes without question, and they just follow each other around until they walk off a cliff together. Yeah, because he didn't notice that she was losing. Yeah, and she was told that she should be in something safer, and yet she lost money and so her response was, I'm not in something safe enough.

And instead of I'm in the wrong thing, she believed the lie about part of it, but didn't understand the situation.

“So the idea that you need to move to all of your investments to a safer, a safe haven of bonds and cash where you make no money as you get older is absolute bull crap.”

It's mathematically stupid because there's two kinds of risk with money boys and girls. There's a risk of actually losing it because it goes down in value. There's another kind of risk. If you don't make 4.2% on your money, which is the inflation rate, then you are going backward in real purchasing power. Oh, as a matter of fact, if you're going to have to pay taxes on it, you need to make a little over 6% in order to net 4.2% after taxes to break even with inflation and taxes. If you're using the asset allocation model and you're in bonds and cash as a part of your portfolio, 40, 50% of your portfolio, you're not even keeping up with inflation. You've gotten tackled from behind.

And God willing, she lives from 61 until I don't know 80 or 81. So what usually happens to a Ramsey follower, if they follow the stuff is there in the four types of growth stock mutual funds, no bonds, no cash.

Because if you follow the stuff we're talking about, the guy I want to go, we said if you just put your house paying away, it was going to be $3 million.

$2.2 million is what I got. So you're going to millions of dollars in these mutual funds. I'm 66. I have millions of dollars in my mutual funds.

“Now, if I have millions of dollars in my mutual funds and they go down this year, am I okay?”

You'll be just fine. I think I'll be okay. But they went up 12.2 year to date, and last year they were a paid team, and the other years they're averaging over 12. And the last five years that two million would have become four million in five years. Just by leaving it alone. Meanwhile, someone following conventional wisdom, this my age, has lost millions of dollars in opportunity. Millions. Oh, and guess what? I'm 66. You think I'm ever going to touch that money, probably? No. I might live off of the income because it'll generate.

If you had two million dollars, it'll generate $150,200,000 a year and income. And not ever touch it.

“So I never go even going to touch it. No, I'm not going to touch it. So it doesn't really matter what it's in as long as it's producing income.”

And so, who am I actually investing it for? Oh, me when I'm 96 because if I'm 66 and I'm healthy, statistically I make it into my 90s. Now, if I'm not healthy at 66, we can change that, but I'm healthy. So knock on what I make it into my 90s. So I have 30 years to outpace inflation. And if I go with conventional wisdom, my two million dollars will be worth less than it is now in actual real purchasing power because of adjusted for taxes and inflation. So that's just ass and I use your own brain to think about these things. Don't use somebody who follows everybody else around.

Yeah, don't be normal. Use your own brain. So that pisses off half of the financial planning world, which really keeps me very happy.

“It's one of my goals in life. April is in Atlanta, Georgia. Hi, April. What's up?”

So I have, I was the dumbest dumb question, like honestly, you know, so I am married. I have and we have a mutual income of a lot of money. I mean, we make about half a million dollars a year between the two of us. You know, so we, we are in a good financial place, but the thing is is I also know that we've been made for about 15 years. I also know that he has always put money away in investments that he has controlled. And so I have never really looked at that. I know it's about maybe two million at this point, like the last time I ever, you know, looked at it.

So my thing is is now we're thinking about divorce. And this is a real situation for us is that we have said that we don't love each other anymore. It's just not working anymore. And it's it's a mutual decision. But my thing is is at this point, do I just walk away from this money or, you know, because he's kept that separate from me for this long. I have money to I make 260. So how much money do you have in investment? So I have about a million and I like one point I'm looking at my investment account right now. I have about 1.1 million and investments on my own in my own money.

So he's got two million. That's got one point. The law in Georgia does not say you have your own money.

So the law in Georgia is 50%. Right. That's all that goes in a pot. All of the money goes in a pile and we split it down the middle. Yes. And yours and his are not yours and his. It's ours until we split it. Right. We have two children. They're nine and seven. You know, like so and he has done there. Let's just let's let's be very honest. Let, you know, he's lived a really good dad life. So the question is, do you, do you, if you're, yeah, all we can do is tell you how great this guy is and I'm divorcing him.

Yeah. It's just so strange. You may have kept your money separate, but it's yours, don't want to go in a pile and you split it down the middle. It's what the law says. And if he doesn't abide by the law, it's not going to be good for him. This good dad is not going to go well with a judge. When you take your car to the shop, you're probably thinking too things. How much is this going to cost me and is it going to get done right?

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“Would you ever suggest reats as an alternative to purchasing real estate in order to get in at a lower price point?”

I've never heard you do that. I've always heard you say if you're going to have 5% to just play around with and do things like crypto, single stocks, reats would kind of fall into that category.

You know, reats used to fall into that category. I think you're right. Read stands for REIT real estate investment trust and it's basically a mutual fund that buys real estate but there's a lot of different types. I don't know, 25 or 30 years ago. I first started seeing them. I just told people stay away from them because in those days the fees being charged to manage the property was so high that the yield to the actual rate of return on buying the mutual fund was low. And in these days, though, I've seen a lot of the current reats that are yielding up around what you might make on a regular growth stock mutual fund. And so you're getting up around 10 to 15% somewhere in there.

I've seen reats that are doing that. And so if you wanted to do a reat as a way to get to real estate, I would that be okay. Pick out one with a good track record. Get with a smart investor pro. They can help you pick one. We have a really great article also on Ramsey Solutions and it goes through the different type the equity, the mortgage, the hybrids and it'll kind of explain all of those to equity is basically buying real estate with equity.

“Which is what I would do. That's the one I would do because this is a way to put in $10,000 and be in the real estate market without having to buy a house.”

But you do want to stay away from the mortgage once because those actually take on debt in many cases. Exactly, exactly right. So in that article is on our website, can give you more detail. But overall, I would not do this until you were ready to buy real estate, which will be baby step seven. Your home is paid off. Your home is paid off and you've got, you know, 15% or more going into the four types of gross stock mutual funds that we talk about growth growth income aggressive growth. This is not a, you know, you think part of your 15% of us not a substitute for your normal investing plan with the baby steps. Okay.

It's in addition to so let's say your house is paid off and you're putting 1520% away for retirement and you got some extra money and you're thinking about buying real estate with it. Yeah, but you don't quite have enough to do that yet and you want to buy a read instead. I love that. That's an okay place, but that's the only time and that's a very small percentage of our listeners. True there. Yeah. That's true. That's very true.

So you've got to get there first before we talk about it and no, I would not do a read instead of gross stock mutual funds.

“And I think that's what Steve asked in addition to, yeah, he's got the real estate bug and he's wanting to get in there quick and get in there easy and that's not what we want to do.”

So you're going to buy, you know, buy, like you do any long-term investment, you're planning to hold it 5, 10, 20 years. That kind of thing and then you're going to be all right. John's in Columbus, Ohio, hi, John, how are you? Good. How about you? Better than that deserve. What's up?

I wanted to really weigh the pros and cons. So I know you're not really for bankruptcy, but I wanted to see what you thought and my situation.

Could be a chapter 13. So I'm about $200,000 in unsecured debt. That includes anything from payday loans to hand your credit cards. I'm spending around $9,000 a month.

“And I think I bring home my room, $11,800 after tax.”

So not much left. I've tried to do like the debt snowball and it doesn't really get anywhere. What is all the debt? $200,000 unsecured? Yes. What do you owe in your cars?

So I've got one car. I think I have read around $27,000. Is that an addition to the $200? Yes. So I mean, it's a Tesla. So I don't want to pay for gas.

I don't know if that really makes up for it. No, I don't want to make up for it. How do you get $200,000 unsecured debt? I'm a good question. So I was a realtor and I read it on the time code.

I wasn't looking much, maybe like $12,000 here.

And I just started, you know, having to take out loans and that to cover basically the expenses,

and then it's just kind of grew from there. You want a long time without working? So $200,000 worth of time without working. Because you're putting your life on credit cards instead of picking up a different job.

“Is it just you, John, or do you have a family, a wife?”

No, I have a wife. So I mean, I'm the one picking up the income. But I didn't really have any gaps in employment or anything, but I was like making $12,000, and then I'd slowly progress. We're over the last five years.

I went from $12.00. Well, that is a gap in income. If you tell me you're making $12,000 a year.

And if you tell me you lived on $200,000 worth of borrowed money,

that's a gap in income. Or you were spending more than you wanted to. Yeah. I think it was just the payday loans, like the amount. So, like, because my salary is around 200 now.

But with the payday loans and stuff, it's like I had to get that I had to. How much of the $200 is a payday loans? It's probably $35 to $40,000. It's not the payday loans then.

“You still got $265,000 or $165,000 worth of other stuff.”

Does your wife know about this? She does. Okay. All of it? Yeah.

Okay. All right. How long y'all been married? I don't know. About two or three years that we've been together for 10 years.

Okay. All right. Well, this is a very, very scary thing that you're in and to go through, sir, I've been there. And I know how it feels to stand in the shower.

And scream and cry because I was so scared. I didn't know what to do next. So, that's a mess. It's a real mess. You're really not bankrupt.

And bankruptcy is really not going to solve your problem. Because the chapter 13 is 60 months of paying payments on these. And there's a formula that's going to dictate that you pay a large sum of it. Not all of it, but a large sum of it back. And if you're going to pay a large sum of it back in a chapter 13 over 60 months,

then you can also pay a deal. Work a deal with these people and work it through. We have an advertiser named Guardian Litigation that helps people in these exact situations. And it's much easier and quicker than bankruptcy. Your credit is destroyed and it's going to continue to be destroyed.

Because John doesn't need to be borrowed money again. So, that's a good thing. But so just continue that idea. You're credits destroyed. And then what is the, you know, the most efficient way to clean this mess up.

Chapter 13 is not. When you run the actual formulas that are required by law against this debt, you're going to pay back a lot of this, not all of it, but a lot of it. And so if you made $14,000 a year, then you wouldn't be paying back much of it. But the formula is based on your income.

And so you're, and the law wants you to pay as much as you can pay in bankruptcy or not.

And it's called a wage earners plan.

So, I'm going to put John Holden. We're going to connect you with the folks at Guardian Litigation and see if they can help you. I think they can. And basically what we're going to, what they're going to do is they're going to go through with each one of these and make a deal with them. And stop the interest and lower the balance.

And then pay it out. And the good news is if you keep paying, you know, $57,000 a month, you're going to be out of this in a period of time. This shorter than five years. And you won't have filed bankruptcy. Hang on to your marriage, brother.

Sit down with your wife, tell her you love her. You're important. You make a lot of money now.

You can clean this mess up and learn from it and never be back here again.

I did.

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Welcome back to the Ramsy Show and the Fair Wins Credit Union Studio. Jade Wash all Ramsy personality is my co-host today. Noah's in Charleston, South Carolina. I know how are you. Hey, Dave, I'm good.

What's up? Hey, so me and my wife both work full-time and are in ministry full-time. We just had our first kid a year ago and we bought a new house whenever we had him just to fit our family better. And now we're in way over our heads and I'm kind of stuck at what to do next. You're in way over your head with your mortgage?

Yeah, it's their only debt. We don't have part payments, we don't want to steal loans.

“Did something change that caused you to be in over your head or you were, it was kind of like that from the beginning?”

No, it wasn't always like that.

We had a home that we purchased for a good price and we were able to sell it and make a good bit of money on. And the next varied entry cost-wise for the housing market that we're in was pretty substantial. And we thought we could make it work and it's just not working. Okay, so from the day you signed up for this current home, you've been over your head. Yeah, pretty much.

You bought a house you can't afford, so what are you going to do? Yeah. How much is it? We're either going to make more money or you're going to sell the house, which is it? We're both in top kind of pay for the jobs that we're in for the ministries that we work for.

What do you make a month? Monthly income is $6,630. And how much is the mortgage? Our mortgage is $2,962. Yeah.

50 percent. Yep. No one. But we luckily put that. No one.

“The education you got to go in the ministry didn't include math.”

That's the bad idea. Uh, messing with you, man. Because you already knew the answer for you called. You bought a house you can't afford, you don't you can't keep it. It's got kids killing you.

We're trying to figure out. It's taking all of your fun. And the psalmist says the blessings of the Lord have no sorrow added to them. This is not from God. Has sorrow?

Would the Charleston disaster a high housing market?

“Like we're in like the lower entry level housing market?”

You don't get a pass on math. Yeah. With that phrase. Well, I was like, it was, was, would it be smart to relocate and find new jobs or a Facebook market or back to the neighborhood and the house you sold?

Yeah. What was wrong with the one you sold? Those built in the 1940s. It had. We'd put 30,000 into it before we moved in.

And then it needed about another 115,000. If we were going close there because it had really gotten mold. But I mean, I mean, that price point of home, that square footage, couldn't that fit a family three? Yes.

Yes. Yeah. But in the market here, that is. No, 400. That is absolute hogwash.

Okay.

Charleston, South Carolina is not the most expensive market in the United States.

To where you cannot live on $6,000 a month and by a home that you can afford. You simply have justified and rationalized buying a house. You cannot afford and honey. You're going to have to sell it. It's killing.

Yeah. You do what you want to do what you called us. And I think you move out a little bit further and have a little bit more of a commute and get out in the country. So to speak, the suburbs.

One county over and you find a home that you can afford that doesn't have mold. And you put yourself into that home. I good news is the market entrusted in the strong. And so you'll probably be able to sell this and get out of it whole. You're probably not going to lose money.

And you can probably hang on a little while. You don't have panic. So you don't have to fire sale the thing.

“But you need to get a sign in the yard this week.”

Yeah. And it needs to be gone by Thanksgiving. Bye.

We bought something we couldn't afford.

Every body listening to this just about is done that one time or not. Absolutely. It's just harder to go backwards when it's a house. You feel it's easier to take something back to the store. But when it's a house, you feel a type of way about it.

Yeah. Well, it's it's harder. It's even hard to go and look at houses in the neighborhood that you can afford. After you looked at a house. Yeah.

You said the bar hire and now you've got to. Yeah. If you go drive a Lamborghini. It's hard to settle on an outie. Oh, man.

It's just hard. Yeah. I mean, and if you actually owned a Lamborghini that you couldn't afford. And you have to sell it to get a used outie. I don't know why I'm picking outies today.

But Volkswagen used a cheddar. How's that? Yeah. Go get you a cheddar. No, the secret.

“The secret to happiness lowered expectations.”

Exactly. Exactly. And so yeah. Well, the thing is in an effort to create a good situation for your family. The two of you made a bad math decision that is that the irony is.

It has caused your family to be in a bad situation. Yeah. And so while the actual environment is nicer. Everything about it reminds you that you made a mistake. Yeah.

And it's like drive up in front every day. It's it's, um, it was an emotional thing because they knew going in. They couldn't do it. That they couldn't do it. But they told themselves, oh, well, just eat peanut butter and jam.

I don't work it out. Yeah. I can do math. He doesn't work it out. He says you had to sell your house.

That's brutal. He brings miserable. He brings misery to you until you sell it. Yeah. It's hard.

I'm sorry, Noah. Yeah. But now that there's no no question. You just did something and you got to undo it. You got to go back to the last time you had a good life.

And it was before you bought this house. That's the last time. And then, yeah, you're going to move out. Don't, don't believe this line. Charles, then.

South freaking Carolina is so expensive. You can't afford to live there. It is expensive. They have expensive houses. Well, they do in every town.

I'm just saying, you don't have to pick. Freaking Emma Rillo has expensive houses. But, you know, that that you can't afford to live in. But every town has a house that you can't afford to live in. Or seven or 16 or 17,000.

I don't know. But, and some counties, you can't even afford to live in. The county we live in is the eleventh wealthiest county in the United States. Williams and county Tennessee. Just south of Nashville.

And it's full of big old thinking houses. It's hard to buy a house in this county. But, you know, but you, and you don't. I wouldn't live in this county if you make $5,000 a month. You probably don't unless your grandmother gave you a house.

You know, I mean, that's it. So, um, but that's okay. You can live one county over and there's lots of houses.

As a matter of fact, my wife and I were kind of doing our drive around yesterday.

And we drove down into one of the counties. Look, nice, affordable homes. And they're not that far out of town. You can actually do it. You just have to drive in that direction instead of the other direction.

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Better than I deserve, what's up? So, I just wanted to call in and see what your opinion is on this. So, I have an opportunity to buy my cousin's company. He has been running it for a very long time, like about 36 years. And he's, you know, he's getting a little older, so he's wanting to sell his company but keep it in the family.

And he's wanting to sell it for 4.2 million.

It is, like, quoted at, like, 6.3. So, I got a question. I got a question. Who quoted at it, 6.6? Well, he said it was estimated because he was going to sell it.

So, I'm not sure what revenue he went down to get, like, how much it comes in. What does the company do? So, it is a blind company. It's a wooden blind company in shape. Do you work with that?

No, it's my mom's cousin.

“No, okay, so have you ever run a business or a window blind company or anything like that?”

So, I want a program where I work now, but it's not like a company or a business. So, what kind of program is that? When you said you run a program? I want to emergency housing program out of Vermont for the state as well.

Okay, so you've never run a business or you don't know anything about business or you work for the government.

And what makes you want to do this? So, he has made himself like, I mean, he makes really good money doing it. I can be very successful. It's something that, you know, I've always had like a desire to. And I've always told him, like, hey, you know, I really want to take over that company when you're ready.

So, how many employees does he have? He has 12.

He said, I think I'd like ask her, like, tax is everything.

The gross was 800,000 in here. Okay. If that, you think that's the net profit? Yes. Well, he said it was 4,000, but like, after everything is 800,000. Okay.

Okay. All right, I love the idea of you making a lot of money and winning. I love the idea of you owning a business and having a desire to run a business. I'm really scared that you've got a cap that you've got to close in your knowledge level of what a business is, how it runs and how to run one, because you're going from zero to 120 seconds here.

And you've never done anything like this.

And there's a lot more to it than it looks like from the outside. And I don't want your dream to turn into a nightmare. And I'll give you one indicator, okay. When I ask you what the gross revenues are on that profit was you didn't even know what I meant.

“And that's, that's accounting 101, which you have to understand to be able to run a business.”

Okay. And I'm not picking on you. I'm just saying you've got a gap of knowledge that you've got to fill, or you're going to get your head taken off in this deal. I also think you have to be bought into maybe you're not in love with wooden blinds, but at least the mission of what they're doing to be the owner of this company.

I feel like you're very interested in the money you might make, and maybe less interested in what it is that the company does. Running a business is very hard to judge point. She and Sam own one, I own one. And it's a lot of work. And it's going to be, when you work for yourself, you got the meanest boss in the world.

You know, you'll drive yourself harder than anybody. So goal number one for Brandy before you go forward is you're going to have to go on a crash course on basic business and basic business terms. And if you could get your uncle to your cousin, I mean, to hire you for a year and mentor you in how to operate the business, that would increase your probability of success like years.

Yeah, he had mentioned I'm doing like business class with him. They have three a year here in Indiana, and then also working with a like mentor. Yeah, I want him to mentor you on how business works and what the problems are that he's facing and be truthful and everything.

Now, I'll take you the first step in, okay, to help you with this,

“because I think, well, I can't tell from the numbers you've given me because of the definition of terms.”

But I'm afraid this business might be over priced even at 4.2. And I assume he's going to finance it for you and you're going to pay him out of the profits, correct? Um, yes. Okay. It would be like a 10 year like payback.

That's how it works. No, it needs to be, it needs to be, what do you make today? What's your income today? I'm like 120,000. Okay, I want you to pay yourself 120,000, and I want you to give him all the other profits until you reach the agreed number.

If you agreed numbers 4.2, and you can do that in three or four years, that's the thing to do and get it done. Get it up with. Don't stretch it out 10 years and don't make it fixed payments, make it a percentage of profits. Prophets percentage of profit. After all expenses are paid, that's profit.

Yeah, that's going to save your butt, too. Now, gross revenue is the total dollars that come in. That's at the top line they call it of the profit and loss statement, the P&L. Every other expense that comes out down the page, what's left at the bottom before you pay income tax. Not before you pay other tax, but before you pay income tax, is your taxable profit on the business.

This business is worth a maximum of four times that number. I'm a little bit afraid that numbers 800,000, which means that this business is worth 3.2, not 4.2 or 6.6.

“Okay, so you need to get a good valuation on it and recommend it outside party, give you an evaluation, like an accounting firm,”

and you're going to pay them 1000 bucks or more out of your pocket to give you an evaluation, place a value on the company.

But your success is going to be based on two things.

One is that you pay a reasonable price and two is that you get a crash course and running a business from your cousin and from everything you can read between now and the time he walks out the door for the last time. You've become a Romanian and personal growth on running a business because it is a different pace. Whatever pace you're used to working for for the state of Vermont, the pace of running your own business is two or three X. You're about to go from wandering along to full on frequent sprint and you're going to stay in sprint until you collapse.

That's what it takes to run a business.

“It's not for everybody and you need to do some soul searching and go, "Do I want to bust it at that level?"”

Because 60 hour weeks are normal for the self-employed.

And guess what? You own the business.

You don't get sick time. You take a towel and all and you go to work when you own the business. You don't get time off for anxiety. You go to work and increase your anxiety. Hey guys, George Campbell here. Do you ever feel like insurance companies only care about your money and not what you actually need? Well, there's a better way. When you go to Ramsey's insurance resource hub, you'll start feeling confident that you're getting the right coverage that's truly best for you.

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“Cheryl is in Hartford, Connecticut. Hi Cheryl. How are you?”

Hi Dave. I'm well. Thank you. How are you? Better than I deserve. What's up?

I found you guys about five years ago, but that was like two months after I opened a robin account, which I basically done nothing with because I don't know anything about the stock market.

And it has a small balance in it of roughly $3,000. And I'm just trying to figure out, should I close this account and apply it to one of the other steps that I'm following or do I just leave it alone? How's it invested? In the random stocks that I know nothing about. I basically just picked some stocks that I knew Apple Amazon.

Are you a random baby step two? I'm on baby step four.

“Baby step four. Okay. You know, are you investing with your 401k at work?”

Yes. I do 15% at work. I would take the money out of Robinhood. And I would just invest it in a Roth IRA. And I would do it through. I'm going to call a more reputable brokerage is what I would choose. Yeah, like a smart Vista Pro sit down with them or take it out and go on a cruise.

I don't care. But everything you set up everything you said about it says you've already made up your mind. You will sense you open the account. You've spent some time with us and others somewhere that made you realize I should not be putting money in things I don't understand. You phrased your sentence that way, correct?

Yes, that's true. Okay. And so that you've got money in things you don't understand. So we should do away with that. Okay. We've got money in single stocks, which I don't own a single single stock, not one. I do away with that. And lastly, I'm engaged in paying monthly for a service that I'm not using. I have a Roth IRA that I had from an old 401(k) from another job that I just rolled into a Roth.

Should I just roll it into that one? You technically can't because it's not a Roth. You just have to open a Roth a separate. It could all be in the same mutual fund. It could all be with the smart Vista Pro. It could all end up on one statement, but it'll be two lines into account numbers. Okay.

Because you can't technically combine separate accounts like that. You just, so like if you had a Roth 401(k) with the smart Vista Pro already, and you rolled over a 401(k) from an old job and you put it over there with the smart Vista Pro.

but it'll be a separate account number. Because each account rollovers, a separate account number,

they technically don't combine. But other than that, yeah, you could, you could roll, put it all in a way that you are comfortable with the way it works, you understand it, and you're not paying a monthly fee for a service you're not using. Okay. Now, the purpose of Robinhood, the app that they're stated purposes to democratize,

meaning make available to everyone, the ability to buy and sell single stocks. Okay. And they do that, they do that very well. They most famously got in the news during the GameStop debacle, when there were some people playing Margin and just about Brokeham screwing around with a Gamestock stock.

“But if you want to buy and sell single stocks as a hobby,”

or, you know, gradually not day trading, it's not a day trading platform,

but you want to screw around with buying and selling single stocks and owning single stocks,

that's what Robinhood is for. That's what it does. And we don't teach people to do that, so obviously we don't, we're not mad at Robinhood, but I just don't, the people that buy and sell single stocks on average, make about 7% and the market makes about 12. So you can throw it in an S&P 500 or better mutual fund, either one,

and end up with almost double what you would end up buying and selling single stocks on your own account anywhere, including Robinhood. Take from the rich and give to the poor, right? Yeah, that's democratized. Now that's the idea. However, you're not, you're taking from the poor, because that's who's playing single stocks on Robinhood.

Rich people on and on there doing that. This is people that,

they read that they pointed to buy stocks, and this was a way to do it.

That's, and like her, she's got $3,000, okay? It's not rich, so there you go. It's interesting, very interesting. The only other time I've heard a corporate entity say democratized, they did it was at the formation of Southwest Air. The founder of Southwest Air said, "I want to democratize aircraft.

I want to make it available to the regular people, common men." That's democratized. And they did. They changed up the no-seeding and they lowered prices, and they limited their destinations. They didn't have, you know, just one or two destinations at the start,

and they were very efficient. They run one type of airplane, so the parts are all interchangeable. They did a lot of things to keep prices down, prices down to make air travel available to the regular guy. That's the only other time I remember hearing democratized

in a corporate statement, but in both cases, they did do it. Robinhood, we don't teach to do what they do, but they did make the trading of stocks with an app very easy for someone that wants to screw around with it. We don't recommend it, but they did follow through on their mission.

“All right, Mason is in Nashville, Mason, how are you?”

You're in pretty good, Dave, how are you? Better than I deserve, what's up? I'd be willing to say that, I'm sorry, short. I've been at my current job for about eight, nine months now, and frankly, I am miserable. I lost them.

Well, it's kind of a dream job for me to do what I'm doing now, you know, better stability for the family. I've married, I got two kids, three and a one month old, and I'm just, it's my numbing if I'm being completely honest. And for the last five or six years, I've been forth and four wheelers

and motorcycles and that kind of stuff. An hour for hours, that is starting to surpass by no small margin what I'm making at my current job. And it's kind of got me thinking, when does the side job become the main thing? How often? I don't care what you're making per hour, I care what you're making.

“Yeah, how often do you make more, do in the flips than you do at your real job?”

I'm almost free, I feel like it's, it's, it's, you know, in a month, what do you make in all flips? On flips, I probably about two, profit, two grand. And what do you make at your job? Uh, 27 an hour there, I just don't have the time to put in

to the four wheelers inside by size and that kind of stuff. How many hours are you working? 40 plus and it's an hour commute each way. 40 plus. Just one?

Yeah, 42, 43. I'm like that. Woopy, you got plenty of time to do reps. You got a phone in your car for your hour commute you're doing flips.

I'm, I'm, I'm doing restorations for a while.

I'm not just picking up stuff that's already running and driving stuff. I'm, so you're not going to put your bond into a rest rush. Correct, yes, sir. Yeah, that's different. And so hour by hour, you're not making anything when you're doing

$2,000 on that. I, my record is 61, 0.62 an hour. Hold it down to, you know, there's some, I've made 25. But that's on the low side. I'm making 27 at my draw curve.

I'm going to run your own business. You're going to put, working by the hour. I'm going to start working by the month. Correct, yes. And you're making $2,000 a month.

You're not making spit. So, you're not making enough at the flips to get away from your miserable day job.

“And you're bringing home $4,000 a month from your day job?”

Uh, you know, I'm sorry. You, you, you broke up. So, yeah. My wife and I were making $1,000 a year combined. So, call seven a month between the two of us.

Oh, what did you make? Me? Yeah, probably $35 to $45 before. Okay. So, when you make $4,000 a month, three months in a row from your flip,

you can go at your day job. Okay. Okay. Perfect. Perfect.

Yes, absolutely. Not 61 dollars an hour for one hour. Right. No, no. Monthly.

Perfect. So, in other words, when you make the leap from the day job to the business, don't make it a leap, make it a step. The boat should be right beside the dock. Just step in it.

Don't jump and hope you get there. Otherwise, you'll be in the lake. Wet. So, hopefully, if I could just work more, I could make more. Now, you got plenty of time.

You're only working 40 hours. You're going to business for yourself. You're going to find out 80's pretty standard. [Music] Alright, let's cut to the chase.

It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back from the first call to closing day.

Find a Ramsey trusted agent near you at RamseySolutions.com/agent. That's RamseySolutions.com/agent. [Music] Our scripture today, Proverbs 25 and 4, "Remove the draws from silver and a silver smith can produce a vessel."

Thomas Sewell said, "Those who complain that the government

is not supporting the creative arts have just never looked at federal bookkeeping."

[Laughter] That's pretty good. I have not heard that one. Joe's an anchorage. Joe, how are you?

Joe, I'm good. Thank you for taking my call. How can we help?

“My question is should I sell a rental property that I bought back in 2023?”

I'm happy to give you details in the back story, or you can go ahead and ask me questions that you think are relevant. Why would you sell it? I don't live in it. It's ultimately cost me about $800 a month with a property manager that I'm bleeding

at an HOA payment and mortgage. So you have a rental property that's losing $800 a month? That's correct. I would sell that. Okay.

What's keeping you from wanting to sell it? You sounded hesitant. So I bought it for 365. There's about 358 left on the mortgage. And CMAs are telling me right now that it costs about 300 or the values about 330.

So I think it would cost you a lot. Don't go down in value. It's correct. Why? I'm not sure.

But it's not unique to the house. It's a townhouse. There's a lot of similar properties in the neighborhood. And they're all just going down. There's been sales as low as possible.

So it's going down in value and you're paying every month to home it. That's correct. Wow.

“So how are you going to get out of it if you're upside down?”

Well I can just continue to pay the. No, I mean if you sell on it, you have the $30,000. So that you're in the hall on. Yes, I do. So I've got my wife and I.

So we're in the army. We bought this house because we thought we were going to get out. Down in Colorado Springs where I bought it.

But ultimately, I did not end up getting out of the army.

I'm now up in Alaska. And we're playing out getting out again here in about two years.

So it's not in Anchorage.

It's in Colorado Springs. Yeah. Yes, sure. Colorado Springs. Correct.

“These are not that market is not struggling.”

It's going up. Is there something wrong with the property? Anything? No, there's there's not. I think I deserve a paid for it.

I'm going to be completely on it. Okay. Well, there's three strikes. It's gone down in value. It's out of town and you're losing money on it.

Monthly reason.

This is like a nightmare.

There's nothing here this positive. So yeah, I'm definitely getting out. If you can get out. But get online at Ramsey Solutions and dot com. And find one of our Trump Ramsey trusted real estate pros.

And make sure that the CMAs that you got are correct. Because I mean, you've owned it since 23. This is 26.

“It should have gone up in value, not down in Colorado Springs.”

Unless you got some kind of a unique problem to that neighborhood. And maybe that neighborhood's got a micro problem. But macro wise, Colorado Springs is a healthy market. Unless he really over bought, which I don't know. He may have overpaid.

You may, and you know, huge army base in Colorado Springs is spoken there. It's a wonderful, wonderful place. And there's a lot of military there.

So it's possible that a young military guy got taken advantage of.

It's possible. Hope not. I hope somebody wouldn't do that to our military, but somebody does every day. So I'm sorry. Wow.

Chris is in Detroit. Chris, how are you? I'm doing great. And I hope you both are doing great too today. Better than I deserve.

How can we help? Right. Right. Okay. Here it is.

Last week, I lost my cousin. I was in charge of off-meaning she died. I was in charge of money that she left behind and also funeral expenses. So after funeral expenses, I'm left with about $23,000. She was raising her eight-year-old granddaughter due to mom and dad, both being addicts.

The little girl now, she's going to a good living situation. But now I have the $23,000 I would like to invest that money. However, I hesitate to put it into her name because what happens at age 25 or 30 if, you know, some reason she was to fall into that situation. Was there a will?

There was no will. And I was. Who's name is on the account with the 23,000? Mine. It's in your name.

It's not in your cousin's name. It's in my name. My cousin who passed away, I was a joint holder on that account with her. We were the only two names on that account. Okay.

Well, I appreciate what you're trying to do. What I would do is get with a smart vester pro. And you can just open in the account and on behalf of the child and manage it and just keep up with the whereabouts of the child. That's some point you'll be able to turn it over to her. As it makes money, you're going to be taxed if it's in your name.

Ah, okay. And I'm not positive that you're operating on. I'm not positive you're operating on correct assumptions. So I want you to have the smart vester pro. Look at the away the account was titled.

Did she have on the account a POD paid on death to you? Yes. Okay. Then it is your money now. And you can do with your money or you want to do with your money.

I would not put it in the name of this child. I agree with you.

“And if you want to use it on the memory of your cousin.”

If you want to use it for the good of the child, just open a mutual fund and just watch that mutual fund and just keep a label on the file. And the file drawer that that I've earmarked this for this kid and let your family know that this is actually not your money, but you're managing it in your name. Yeah. Yep. I've already done this.

So mutual funds in other words, is that the same as a high yield savings account? No, it's much more. It'll do more than high yield savings. Yeah. Because you've got a long term.

I mean, you've got 10, 15, 20 years before the child's going to need this amount. Yeah, she's eight years old. And so I appreciate that. Appreciate what you guys do and thank you so much for taking my call today. Thank you for being there for that baby.

Yeah. Yeah. High yield savings account is very different from a mutual fund in that way.

If you invest in a mutual fund, hopefully you're upwards between 10 to 12%.

“And it's invested in money, which is what you're looking for.”

Which is why we suggested a smart vester pro to help you. I'll teach you about that. You don't learn about it. And you do a good job investing. It's a good one.

Exactly right.

And so guys, the situation that Chris found herself in there, can that one went well.

That can go sideways in a heart beat.

“If you don't properly do the documentation.”

And so her cousin who was ill needed to have left a will with Mama Barrelegal forms where somebody to dictate how all this was to go down. And to clarify that the money was left not to her daughter, but to Chris. If that had not had a paid on death on that account, probably half of the 23,000 had to go the eight year old today. Mm-hmm.

Oh, not scary. Because there's no will. And that money was her mom's money. And it goes to her blood relative in most states. And so, but if it had paid on death to Chris, which is what Chris said, then it all none of it went to the child at all went to Chris.

Chris is half and her cousin's half now goes to her on death. Then there's no nothing, but I mean, that's that one little change on that account. And that eight year old will be sitting on 11,500 dollars. And in this better situation, whoever knows how that money goes. Well, gosh, yeah, because without a will, the state is now even deciding where the eight year old goes.

Guardianship wise, which is tough. Well, sounds like they've gotten something lined up and that was approved by the state at the same exact thing. Your child is left at the head of the state. And the last thing you want is the same people that run the DMV deciding anything for your kid. So, no.

Very nice. So, this is why you need detailed power of attorney, prior to death, health care power of attorney, you need a will. And it's really not that expensive that hard to do at Mama Bear. And that's why we have endorsed them. Chris pulled this one off.

They pulled this off. They got out. But truthfully, one little stroke of the pen and this could have been a nightmare. That's right. I put this hour of the Ramsey Show in the books.

We'll be back with you before, you know what?

In the meantime, remember, there's ultimately only one way to financial peace.

“And that's to walk daily with the Prince of Peace, right, Jesus?”

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