When You Don't Have Payments, You Have More Options

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

from the Ramsey Network and the Fairwins credit union studio. This is the Ramsey Show, Rachel Cruz, Ramsey Personality, number one best-selling author, co-host, just smart money up here, and my daughter is my co-host today. So Rachel, we did that post, that's silly thing you want to do with acting like we're doing a Netflix documentary or something.

Oh, yeah, we're going to talk about that. And, um, thank you, thanks gone bananas, whatever you were right, it's a big deal, apparently

“it's a trend to sit down and the chair and act like you're doing a documentary, right?”

Yeah, exactly. We did it, and it went on Instagram and went crazy. Yeah, it was. The numbers are, no. Well, like 1.3 million.

And so, yeah, they brought, I mean, yeah, yeah, yeah, over that crazy. Yeah, so, some of them were saying they had read the comments and a huge number of people didn't realize you were my daughter.

Yes, there was a lot of, like, well, today, I would say there was a whole full day for

ad and a trend and they actually think there's going to be a Netflix documentary about being Dave Ramsey's daughter on Facebook. Yeah, there's not. Okay, he spoke specifically, a lot of people are like, oh, no, I just canceled my Netflix membership.

Oh, miss, you know, miss it and we had to go at a call and be like, it's a joke. It was just a trend on Instagram, just a trend, and I made it to do it. To do. I made Dave do it. Sometimes he, you know, he's the anti social media guy.

He's our boomer. We are resident boomer, who we love. But we get to rope women, sometimes it's a summer. To some of the trends and sometimes he says yes, and then says no, but he was a good one.

“Yeah, it was fairly innocuous, it wasn't like, you know, you have to be a clown or something”

to do.

No, we did want a thousand years ago.

We are years ago. You remember the, when Twitter was Twitter back in the day, was it the ice water challenge or whatever? You dumped buckets of water on paper, ALS. ALS.

Yeah. Yeah. You dumped, well, it was called, it was the ice bucket challenge. You dumped buckets of ice on people and then you play them doing it on, and so we ended up having the fire department come over to the front of our building and our whole team got

dumped. Yeah, yeah. Remember, they rained on us with stuff, that was a pretty good place. That was a pretty good place. Yeah.

That was a trend that I participated in. That was fair. That was only 30 years ago. I was going to say, and I was like 15 years ago, that was fun. Up in the end, Dave.

We're open yet. Yeah, I'm going to make me relevant yet. AC is in Minneapolis. Hi, NAC. How are you?

I'm doing well. How are you? Better than I deserve. What's up? Okay.

I'm calling because I am in a position where I don't have to pay any household costs as far as rent goes. And I'm just wondering if I should use my income in this time that I have living rent free to use a time to build my business or use this time to give another job and pay up debt as fast as possible.

How much debt do you have? About $180,000. What is that consist of? Student loans, stuff in collections, and a tax bill. Okay.

“Why are you living, how are you living without rent?”

So I converted my SGV into a tiny camper, and I've been living out of my vehicle to expedite this process, and in the process, when you start working on your debt, everything starts coming into full swing, and the next thing you know, I'm getting garnished. My wages are getting garnished. So now I'm thinking maybe I should just put building the business on hold and get another

job. But also, I don't have any rent to pay, so it's kind of like which road do I take? Who's garnishing your wages? Um, the state, for taxes. Okay.

For a business that you own, no, it's not for a business, so it's like income tax. Oh, taxes. Okay. Now how much in tax do you owe the state? Um, I owe about $20,000 for, uh, be in about $12,000 for federal.

Okay, and the state is what's who's garnishing your, the federal's not. That's correct. Okay. All right. And what do you make at your current job?

Oh, I'm about $83,000 a year. And that's being garnished. Yes. Okay. So how quick can you come up with $20,000, making $83 and living in your car?

Pretty quick. Pretty quick.

Yeah. I mean like quickly and get rid of the garnishment by paying it off.

“The thing here is I've been attacking my car alone that it's no no no no no no no no you need to take care of the tax debt.”

And when you're doing your debt snowball you put IRS and income tax with the state at the top of the list because of what you're experiencing. And so we're going to get rid of the state debt as soon as possible. So 83,000 so $7,000 a month. So you're coming home with five or six thousand dollars a month and you've got very little. I'm coming. I'm down to like about 35,000 or 35,000 dollars because of the garnishment. Yeah. How much are they taking? Yeah.

It's about $276 a week. Oh, okay. $1,000 a month. Okay. Well in 20 months that'll be gone if you don't do anything. But we need to do something and get rid of it as soon as possible. So the the question is do I work a side job or a side business? The question is do I work a side job or continue letting them garnish me continue paying off my car and then use this time to start my business as well?

“No, you don't start a business right now. Now you need to work as many hours as you can work getting paid money quickly as much money as you can make more early.”

And you start with this tax debt and clear it first before you clear the car and then you clear the

IRS and then you work your debt snowball from there and when you get Back on your feet financially and you've got the IRS and the state off of you and the face to live and then you get a nice to live. Yeah. Yeah, you've been you were very nonchalant about the fact that you're living in your car But I don't but I don't want you there for long. No. Yeah, it's not a it's not a long-term plan.

I definitely plan on saving for down payment for a house. No, no, no, no, no, you need to go rent on one bedroom. I'll rent after my car. Yeah, and I wouldn't want to be out. I mean, I would want you out of that situation in a couple of months. Yeah, we don't need to go into Minneapolis in the winter. Right. You need in the ish in the back of the SUV. So I want you to clear this debt as soon as possible Working extra and throw three four five thousand dollars a month because all you do is work

at this at this state debt and then then Go after the IRS and then get you and somewhere in there get you an apartment and get out of the car And yeah, because there's like an 83 thousand dollars a year. You can live in an apartment and you can clear this debt and work side job. Well, and you have 3500 left

“So if you threw an extra 2,000 lived on 1500 with food in the car payment, right?”

And then worked extra, you could technically put 5,000 Yeah, away per month. Yeah, and that'd be for a month you'd be done. Yep. That's the direction. I'm sorry. You see. Oh, wow. You're after it, kiddo. Get after it. I love it. I appreciate your willingness to Sacrifice like this, but let's have a plan. So we that this is definitely in our in our past not in our present anymore.

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Jacob is in Canada. Hi, Jacob. Welcome to the Ramsey Show. Hi, guys. Thank you so much for taking my call. I'm very appreciative. All right. What's up? Um, so my question was, should I let my fiance family move into our

“newly purchased home, even though she's been manipulated her whole life, her family, her mom?”

Her mom's been manipulative her whole life, is that what you said? Yeah, yes. So you're not a fan of this? No, it's like I love my fiance dearly. Yes. And does she see how much it just affects her? It doesn't. Does she recognize that? Yes, she does recognize it. And I think for her right now, it's just kind of grieving that we might lose her family, like we might have to draw a boundary

to a point where we don't really see them. If your family is only going to have relationship with you because of what they can get from you, they've already abandoned you. Yeah. Which, you know, I tried to let my fiance know and it's just, we're going to a point where

“if you have to pay for relationship, it's called prostitution. Okay. Yeah, yeah, it's a good point.”

And so you guys are saying that it does get to a point where, you know, they just got to notice in the mail that they're going to be kicked out tomorrow. You didn't do that. And yeah, no, I know. It's been their decisions. They don't kind of struggle. And I feel like they won't take any help. Yeah, they don't work much. Yeah, yeah. So you would recommend that just, you know, set the boundary and they can react to however they want to react and you can't control their reaction. You can predict it.

Yeah. And they get, they've come to you all. They've said, we're, we're, can we, can we move in? Like they've, they haven't, but we're like 99 cents shared. It's going to come. They got the letter. We've been talking about it. She's been making jokes. Like, oh, we could just stay in your back here. Uh-huh. You know, I'm not really funny. But you know, it's more of a day. Well, I don't think then an boundary has to be set until the question is asked. So I wouldn't, I wouldn't advance

to the boundary. That's right. And just say, you know, um, thanks for asking. We're going to be cheering for you. We love you. Uh, we'll try to do some other stuff to coach you and help you, but um, moving in whether this really isn't something we're able to do. I'm sorry. And by the way,

when you're setting the boundary, the fewer words that you use, the more powerful it is.

Okay. Don't go into our lengthy explanation about family dysfunctionary, anything else. Just go, you know, we talked about this and we're just not able to do it. I'm so sorry. But we love you. Yeah. We're coaching. We're, we're cheering for you. We want you to win. And um, uh, do you got, do you have any money? Are you doing well financially? We're doing pretty well financially. Um, like right now, we're in that we're about to finish up the

renos. We'll be a little low on cast. But we both have got, you know, we're getting a budgeting. Because you don't have any cash to like give them a thousand dollars to up and with the deposit

on the next place or something like that. No, no. I would not be able to help her with first dinner

“last ever. Okay. Okay. That's what I was asking. All right. Yeah. Yeah. And Jacob, buying a house with”

someone you're not married to is really a dumb idea. You guys should get married yesterday. I would agree. We're getting no argue with me to go get married. Can I give you one reason to close up now? Yes. Yes, you can. We're getting married to Timber in the venues all booked. And the reason you went with the house earlier than we would have liked to is because it was a private sale. My cousin had owned the house previously. It was a good deal. That was kind of the idea behind that. But I agree.

Because it except you don't agree. But yeah. Okay. Hey, at least you have a venue in a date. Yeah. That's good. Yeah. September will be here in the month. Yeah. We're moving. We're moving. The reason I bring that up to is it does change the discussion too. If it's your mother and law versus your fiance's mother, that's a little change there. My girlfriend who lives with me is who I'm planning to marry parents have trouble versus who I am. Is different than my end laws have trouble. Yeah.

That's a different thing. It is. But also the the result will be the same. The answer is the same.

I would suggest that you don't answer the question when it comes that she answers the question.

“Because if you tell her mother, no, you're going to be the bad guy forever and ever. The evil”

man that stole her daughter and that his selfish and won't share everything with our dysfunctional family. But she needs to handle her blood that's crazy. And she does anyway, probably. But if I'm the boyfriend, I'm just going to be like, what do I care if you're mad? Just be mad. You know, I'm a husband. I'm a little more worried about the long-term relationship aspect. Sure. Sure. I know we're planning to be a husband in a week. But we're not a husband yet, so yeah.

And that's the heart. That's one of the hardest parts of the money dysfunction with family. And especially we're seeing more and more grown kids with their with their aging parents, unity mean. And it is a that's such a hard place to be that if you have the relation the relational equity and the means to be able to help. And you choose to that's beautiful and wonderful.

“If that's what you want. But this idea that I have to, that it's now my responsibility to take care”

of them when they've not been responsible adults. We're seeing that. I feel like more and more.

Oh, it also calls. Yeah. And, you know, again, boundaries are a decision. But here's the thing.

You can, Henry Cloud talks about that in the famous book that he is his best selling book of all of his best sellers called boundaries. And, but if you set a boundary with someone that is doesn't like boundaries, please expect them to be pissed. A hundred percent chance they're not going to like it. Because, you know, you don't have to be mean, but I mean, a hundred, if they don't like the word, no, because they feel entitled. They feel like you owe them something because of

blood that you have to live that I'm going to live in your backyard. And, no, you're not either. Not funny. I agree with them. Not funny. Throw in that out there. That was pretty funny. Not funny. Not funny. Not funny. Not funny. I'm trying to be funny, but not funny. Jake is in Pensacola. Hey, Jake, what's up? Hey, guys. Thanks for having me on. How are you doing? Better than I deserve. How can I help? Um, so my wife and I just recently started

saving for her to go to PA school. And, um, that's about three years out from now. Um, and we've been doing a stacking cash into a money market account. And I want to know for doing the right thing by doing that. Yeah. That are how you'll savings is fine. What's your right on it?

“Yeah. Uh, it's 3%. That's what I found through fidelity. Okay. Yeah. You might do a little better than”

that with, um, fair ones credit union. You might check their, uh, their high yield savings.

It might be a little better. It's not going to be like 5% better or something. So here's the thing.

How much are we going to save total in the next four years for this? I want to save, uh, we both want to save around $90,000. Okay. A little bit overshooting for the year's school. But I don't know if our expenses are going to be that much higher. Got you. Got you. So the reason that she will have $90,000 and get to go to school without debt is because you put $90,000 in the account, not because of the rate of return. Okay. Yes, sir. Because 3% on

$50,000, the middle range of this, which it'd be like two years before you get there. Okay. So 3% of that is $1500. $1500 does not mean she gets to go to school. In other words, if you got zero percent, they'd be real close to getting three. I see what you're saying that doesn't make sense. Yeah, it's not, it's not, it's not, it's not. In a two short of a time frame, to probably put in the market. If you wanted to put some of it in a gross stock mutual fund and maybe

an S&P 500 or something, you could, but it could go down. That portion could go down. But again, if $50,000 was in there and it went down 10% which would be unheard of, very rare, then you would have lost $5,000 and that won't keep her from going to school. Yeah. So the investment vehicle is not going to make her go to school or keep her from going to school unless you gamble it 100% on something stupid like crypto or a hand to poker or something

dumb like that or draft kings. You know, which we're not discussing any of those things without laughing. [Music]

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I'm great. How are you? Better than I deserve. What's up? Hi. Thank you for taking my call and I have lots of respect for you. Thank you so much. Thank you. My question to you is I have a real estate property. It's a townhouse that I bought a few years ago. I paid cash so there's no mortgage on it. I have credit card debt of 50,000 in a student loan of 40,000. So the real estate is worth about 200 grand. My question to you is should I sell that property

for 200,000 and then use that to pay my credit card in my student loan? What's your household income? My salary is 70,000 but I rent a couple of the rooms in my house so it brings me up to like 110,000. Including the rent on the townhouse? Uh-huh. Okay. So you make 110, you owe 90 and you have this 200,000 paid for investment. Okay. Number one, I love the investment. I think it's great and you like it. I can tell by the way you talk about it. I do. You don't want to sell it. Okay. Now. So the trade

off is that you're going to have to live on beans and rice, rice and beans, no vacations, no eating out and do anything you can to earn some extra money. You're already doing a lot of things to earn extra money but anything you can do to get these debts knocked out fairly quickly to make keeping the investment make sense. If you're going to be 10 years wandering through this debt, it doesn't make sense.

“You need to sell it. But if you're going to say I'm going to knock this out $30,000 a year and be”

done in three years or $45,000 a year and be done in two years. Yeah. Which would be like $4,000 a month or $3,000 a month. Okay. Could you do that? Yes. Yeah. I should be able to. Yeah. If you do that then I'd probably try to hang on to it because it sounds like a good piece of property. Yeah. I get 1750 per month. That's a good return on 200K. That's good. That's a good cash on cash return. Good. I'm doing bookkeeping on the side too. So I had even count that salary. That's a good there.

But so what's the most you could throw at this debt per month right now? If you just really tighten on the budget. If you're telling me that I can do $3,000 a month then I'm going to do that.

that's it. I have no car payment. I have nothing else. My mortgage where I live, that's the only thing

which is $2,000 a month. Yeah. So I'm saying when you get on every dollar and download it tonight and lay it out your bookkeeper, your smart. I can tell by talking to you that you know your numbers. And so what we're looking for is three to $4,000 a month. And if you can find that and commit to doing that then keeping the investment makes sense because you're going to be done in either $4,000 is done in two years, $3,000 is done in three years. Okay. See, 36 times three is going to knock

your 90 out or four times 12 is 48 a year and that's 90 in two years. Okay. Okay. I've been doing the snow effect. Yeah, I would do that. So I've been doing that and throw it at this. But you've just got the two debts, right? Yeah. Yeah. My credit card and my loan. My student loan. Yeah. So I'm not going to knock the credit card is the credit card's a smaller one, right? Well, there's different credit cards. Okay. So yeah, knock out credit cards out smallest to largest and attack them in

that order and that's going to put the student loan at the bottom, which actually ends up mathematically

“correct as well. So that's good. Got that going for us. But yeah, I think you're amazing and I think”

you can do this. But the answer to your question is, it does not make sense to keep the investment property and drag this debt out a long, long time. It does make sense if you like the investment property and want to sacrifice and do three to $4,000 a month on this debt and be done in anywhere from two to three years and keep the investment property. That does make sense. But you would tell someone if they had $200,000 in an index fund to cash it out, cash up part of it to pay off the debt.

A word, but that's a lot easier transaction and less expensive transaction. And this is a known, this piece of real estate is a known factor. Of course, that's a known factor too. But yeah, but that's very liquid is what I'm saying. Yeah. You just got to, you just got to push one button and that money shows up in your account, right? With real estate, you got to sell it, you're going to pay brokerage fees, and then later you're going to reinvest, you're going to pay a bunch of other fees.

And so there's a lot of generation, and the point is to that she enjoys it. Because we do talk to some people and they have an extra property and it's a headache and they don't enjoy it. So

“you're like, yeah, if you want to take 200, throw 100 at your debt, take the other 100,”

take it an index fund and just let it ride and be more of that passive investor. Yeah, I'll do that. Go that direction, exactly. But if you love real estate and that's part of how you want your long-term play, keeping that. Good point. Brett and Kansas City, hey, Brett. Hey, Dave, how are you? Good, Matt. What's up? Hey, yeah, just question. So recently,

just went through the force. Finally, got all our financial child support, all that's kind of

figured out. In the next few months, I'm going to be getting some equity in the house I used to live in, and I'm curious, since she's going to be getting some of my retirement, I'm wondering should I put that money back into my retirement or should I use that equity to pay off my bills, some of the loans, law your fees, and then that would pretty much put me that free. How much is she getting from your 401(a)? Well, it's capers. I'm in the public school system here and here and how much is she

getting from, um, it's going to be about half, um, I've worked for 20 years and we've been married 17 in that. Does it have a dollar amount? I have 87,000 in there right now. Okay, so she's getting

“43,000. Roughly, yes. Okay, and how much equity are you getting out of the house?”

About 60,000. Okay. Why didn't you leave your 401(k) alone and take less out of the house? Uh, that was just part of the deal. I know why. I came to during mediation. Why? It's a bad idea. Oh, I can't go back now. You can't. It could. Hypothetically. Uh, but how much is all the bills? The law your fees debt, everything. Um, about, let me see, I got the biggest ones of vehicle that I got in the vores that she

basically kind of gave me here that we came to an agreement on, um, 47, right about 50. What's the, uh, what's the, uh, what's the car worth? Uh, the car is probably worth 35. Okay. And you don't need it, right?

I have two vehicles. One's paid off, um, and they did super old. And it's always in the shop getting

repaired and uh, basically we bought a truck about a month before we separated. And so we don't,

That's part of the 50, yes. Yeah. I'd sell the truck. Mm-hmm. And yeah, throw some of the money at the difference. Yes.

“And if you need to buy, you know, a $10,000 car with some of the cash, that'll be fine.”

But I get out of that truck debt instead of paying it off and keep it. What's your income? Um, my main job, I make about 87,5. And then I make about 25,000 and just some other side stuff that I do. Yeah, okay. Well, yeah, you're, I don't think you go back and change it like I said originally. I think you stay with the deal you got. Take the cash. You become debt free by getting rid of the truck. And, um, you're not got enough to do much else with.

Build an emergency fund. By the time you pay off everything, there's not much left. And then go back to retirement. Hey, guys, healthcare is one of the biggest stress points in your budget. It's confusing.

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Go to CHMministries.org/budget and use promo code Ramsey that CHMministries.org/budget and use promo code Ramsey. [Music] Tari is in Charlotte. Hey, Tari, what's up?

“How you doing, sir? Better than how to serve. How can I help?”

Okay, so I'm trying to clean up my debt and try to clean them with it. And so I did collect or they sold it off to another debt collector. So I called them up and tried to

basically cut off the debt. So they told me they can't collect on it. And it's reached a point

some, I can't remember the term in use, but they said they can't collect on the or they don't report on it to the credit bureaus and I'm trying to get it off my credit report. I'm trying to get it off. The debt collector that bought the bad debt said he can't collect on it. Yeah, you can't collect on it. And I mean, you offered him money and he didn't want the money. Yeah, I'll try to settle, I'll try to settle with the debt. And you say it is the point

statue of the imitation of some of these. Exactly, that's exactly what it is. It's passed the statute of limitations. That is so on you. That's true, but it's so on you for a little debt collector. What I want to tell you that instead of just take some money. Right. So now, nothing is how do I tackle it and get that off. I'm trying to settle it and get that.

Okay, first thing I would do is call the debt collector back and ask for an email from him

just saying in writing what he told you on the phone. Okay, I mean, I'm so, so I did come back and what they said was he said, I'll tell you how to handle it, solve it, solve it into the speed. Our team will handle it. Yeah, you, you, you, you seem to like. No, I'm asking you to send me an column by I'm asking you to send me an email saying that you cannot collect this debt because

it is past the statute of limitations. I'm asking you to send me an email saying that. That's what I want him to do. Number one, then number two, you've got to write two and there's an email place to do it on each of the websites, all three credit bureaus. We're okay. Okay. And what you do is you say this particular debt, I am disputing it as being valid. Don't go into detail. Don't

want to go back and play this on the podcast later, playback, according to the federal

“Fair Credit Reporting Act, you have, this is your verbage in the letter. You have 30 days to prove”

the validity of this debt or to completely remove the entry from my bureau. And you send that, I would send that by email if they've got a place on their site and I also would send it in hard copy letter form, certified mail or FedEx or something where you can get proof of delivery on when the 30 day starts. Okay. Because all the other credit, you know, I was able to, you know, settle on or it's the one that they say they can, they can really, they don't report

or they don't, they don't, they don't report on it, nor do they, whatever, whatever I said. I don't. Well, he can't collect on it because it's passionate statute of limitations. And if it found out later that they collected on something that they're not allowed to by law, they could get in trouble. But most of the time, those guys are so scummy, they don't care, they take your money anyway. So I'm a little shocked, but it's okay. I'm, it's coming out

“of your favor. So yeah, you need to send a certified letter, federal fair debt,”

collection practices act and federal fair credit reporting act is the federal, two federal laws that dictate how this is handled. And when you dispute the validity of a debt on your credit bureau, they have 30 days to prove it or remove it. Now, for the rest of you out there, not for this guy, they will not be able to prove it in 30 days on any of your debts, even if they're valid because if they write to Bank of America, Bank of America is not going to

get back to him for 30 days. And so you could get that blown off your credit bureau. And there are

people that teach that as a way to quote, clean up your credit. The problem is it doesn't work

because it will get removed from your credit bureau report, but Bank of America or whoever downloads and batches to all three credit bureaus at least once a quarter. And so about about 120 days from now, you're going to say things pop back up on your credit bureau. If it's not the past, if it's not an invalid, if it's not an invalid debt, it's going to come back. You can knock it off for a minute, but it's going to come back. In this case, it sounds like these guys

are not going to report it again. But if you remove it and they re-report that they have this out for collections, it'll show back up on there again. How long does it take for the statute of limitations that statute of limitations on a debt is different in every state? But in his state, a lot of them are three, four, five, six, seven years. Some were in there. They everything comes off of your credit bureau

report every seven years from date of last activity. The problem is if Bank of America and this

example re-reports, that's activity and it starts to seven years over again. So even though you didn't pay anything on it, even though you didn't actually have any activity on the account, they can start the seven years over again and keep you in limbo for freakin' ever. So you cannot get out of paying these debts unless someone does what this guy's saying is happening with him, which is a very unusual circumstance that he called with today. But most folks out there listening, you're

going to have to go get those things settled and you're going to get them paid off. You don't get your credit bureau cleaned up until you cleaned up the actual debt because it's just going to pop back on there and you're going to see it and it's going to hang out seven years. A chapter

“seven bankruptcy is the only thing that stays longer than seven years, it stays on ten years.”

And an interesting fact with that is none of the loan applications or applications that you fill out for other things say have you filed bankruptcy in the last ten years, they say have you ever out bankruptcy yet. And so even if my chapter seven bankruptcy from 1988 no longer shows on

my credit bureau report, if I answer no, I have never filed bankruptcy because you can't see it on my

credit bureau report and someone does business with me do that me answering that question. That's called criminal fraud. I lied to get to do business. So don't do that. It's a bad idea. Eonus. So you tell the truth and so since I filed bankruptcy in 1988 the year Rachel was born for the rest of my life I get to answer that question. Yes, I filed bankruptcy. What were the dates? It's like filling out one of those medical forms. I've ever had an operation. Yes, in 1982

I had one, but you still got to fill it out because they're still going to find it and you know

stuff in there. Anything any hang nail that's ever happened has to show up and that's the way this

stuff is. And by the way, it's just a reason to almost avoid it so it doesn't just follow your whole life. Yeah, hello. Hello. Oh, no, I feel like I have you ever been devoid of it. By nature you can recover and have you ever been divorced. If you have the answers, yes. Yeah, yeah, not lately. It's not it's not a not lately. That's not the answer. You know, not 20 years ago, that's not the answer. The answers, yes. You know, that's it. And that's simple. So, you know, these decisions are big life

decisions. Yeah, entire brings up a good point, too. Just to remind everyone, you can check your

“credit report for free and you should once a year. And you should. The Equifax Trans Union,”

you can go to these websites. And you ought to also freeze your credit. Yes, and freezer children's credit as well. We did well. And that's a thing in the butt. I had to go in and just rip people shred to get it. But I froze all of theirs when they were minors when they first came out with a law allowing you to freeze it. And what freezing it does is if someone bothers to check your credit before they issue a debt that is not that's like a identity theft thing as an example, then they

would deny the credit because the credit bureau's frozen. And so they would say, oh, this person's

not really applying for that. But the problem is about nine out of ten credit cards are issued

without checking credit. So that's why a dead person and dogs get credit cards. And a guy named a guy in West Virginia one time sent me a copy of his credit card and he had applied for the credit card in the name of book, "Necchid." And they issued the card. Visa issued to book, "Necchid." Unbelievable. Love it. That's a good segment. A perfect craziest thing. A craziest thing that I've ever had put me up. Yeah, I'm proof through the poodle got one

two and he'd been dead three years before he got his. If you've worked hard to keep your card running, the last thing you want is stress when you're running the kids all over to summer activities or loading up the family for a well earned vacation.

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and your travel plans. And Christian Brothers stands behind their work with the nice difference warranty. Three years or 36,000 miles, whichever benefits you more. So before your next trip, take care of the card that's taking care of you. Go to cbac.com/ramsy to schedule your service and get 10% off your visit. That's cbac.com/ramsy. 10% off up to a $250 value. See stores for details. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio. Rachel Cruise is my co-host today.

“James is in Kansas City. How James? Hey, how y'all doing today?”

Better than we deserve. What's up? Good. So just a little quick question here. So basically,

I work for a university and I'm due to be laid off here in about a year due to the school folding into another here in the area. I've got no debts. I've got a year's worth of emergency fund and I'm also due to get some severance and retention bonuses about the school kind of, you know, goes towards closing here with any year. My question is, should I start really looking hard for a new job right now or should I kind of wait collect those bonuses and see where I'm at,

you know, within about a year? So the bonuses and the severance are going to amount to how much money. About after taxes I've done the methods about 24,000 altogether. Okay. And what do you make? Right now I make 70,000 years. Okay. And what do you do? You're a professor? I work as a, yeah, I've known I'm actually a compliance coordinator for the financial business office. Okay. All right. And so what will you likely go to? What's your new career going to be your new job?

Same thing? Well, I've been thinking about that. There's also some different, you know,

where I get back into compliance or risk management. I'm kind of kind of on the fence with it.

Probably a lot more money there in there. 20% by far. Okay. So let's pretend that you found a new job making 120,000 today and they wanted you to start today. Well, you would take that because 70 plus 24 is less than 120. Yeah. I'll pretend you found another job making 70. I would not take that until the last day of my other job of my current job because I would want to get

“all the bonuses. But I think you're probably going to move up and pay as you shift the type of”

compliance work that you're doing so much that this bonus is not going to be worth sticking around for. I think you're right. I think that's the math. I'm going to let math drive it, but go out there and start poking around. Yeah. Have you talked to anybody, James? Just in that

industry and just kind of have a feel out of how easy it could be to get your foot in the door somewhere.

Yeah. I've done some poking around. It's definitely going to be a lot harder. I used to work in the banking industry. I want to maybe jump back in and I know you guys say, you know, don't just throw applications out there, so I'm really trying to hit my connections, you know, to see, to see kind of what I can get. Right now, I haven't had a lot of hits, but I know the job market is slow. You've ever had any history in the securities side of, um, like, we're coming for a broker

dealer or something on that side of compliance? I have not actually got to work looking into.

“Okay. I'll pay better in banks. That's why I was asking. Sure. But, but, um, but if you've had the”

history in the bank and you can get your foot in the door, I don't care. But I'm actually thinking

you're probably going to go move to six figures. Does that sound right? It does. It does. It does.

It just good. It takes a lot of, of course, effort. Yeah. Yeah. Obviously. But why not, why not work on it now? Uh, and if you could get six figures starting next month, then we would just go ahead and say goodbye. Yeah. I think that's fair. Yeah. So let's do that. And I'll, I'll send you a copy of Coleman's book, a proximity principle, which is what you're referring to, to the future connections to get in the door on things. For sure. And the wisdom of, I mean, he's at the luxury of, just say,

it gets down to the wire. He's got three months or so of a pay plus and a year, a big emergency fund. Nothing's on fire right now. You know, you know, the end is coming. So you want to start having these conversations. But in a great way is, you, you know, if you have two or three options ahead of you, you get to kind of make that decision of what's best for you. You get options. There's no urgency of, oh gosh, we have to start making an income because we get some of those calls.

And it's like, you've got to go, you've got to start doing anything. Well, and when you're desperate, you don't interview as well. Yes. You know, your body language is different. Your voice tone is different. You walk in the door different. You feel different. They can feel it in the air that you're, that you're scratching and clawing at this. And if you're like, yeah, I like to do this. It looks good. If you, if it's a good fit, all, you know, let's talk about it. And it's a good

partnership. And yeah, that's a completely different interview. Yeah, for sure. And in this, there's nothing. I mean, there's no moral obligation by any means to stay. But is there any level of loyalty of, hey, I'm going to, I'm going to finish off this. I'm going to, I'm going to go down with the ship. Roll with a college that went out of business. Well, I don't know because they didn't follow my compliance guidelines and didn't stay financially solvent. Could be that too.

“Yeah. Oh, my gosh. Donald is in San Antonio. I Donald, what's up?”

Try a good afternoon. Thanks for taking my call. Sure. How can we help? So, meanwhile, I've retired from baby steps seven. And when you're still doing the envelope system and my question is, are we better off? Because a lot of the envelopes just build like the ones we have for car repair and Dr. Co-pays and get bills and all that. They've done it just sit there. I'm going to be better off just isn't that sitting in our

IRAs instead of taking that money out of the most. Well, I would at least probably put it Donald in and just to a high yield savings account. I would put it somewhere. So, yeah, to your point that it's gone. If it's building up too much, you've got too much allocated to the category. Okay. So, I mean, if you've got $5,000 in your vet bill envelope, your dog's not been sick. I mean, you see what I'm saying? You've got $5,000

built up in your car repair envelope. You've over-budgeted for car repairs. And so, that's, you know, she should not have big build ups in there anyway. But a lot of people, including both of us, have gone to just very few or no envelopes. And instead of just using the every dollar budget and using a sinking fund approach inside, which is a little miniature savings account,

your money is. And a lot of people are using that digitally now, rather than the actual physical

cash in the envelope. My wife still carries a couple of envelopes. She still does that. But everything else we do at the Ramsey's is now done with with debit card and with the budget system and it is at your house, too, right? Yeah. Yeah. Cash is getting unlimited. Yeah, but you're right. What ends up happening is, is that you've got the money to do stuff, and you just do it. And then you look up and go, how that envelope's got like $6,000 in it.

And I'm walking around with this in cash. You know, so, no, that you, yeah, and I would say

the envelopes are some, the purpose of it is to control your spending to know what's going on

per category. And to have a level of real life accountability that when there's no money in the envelope,

“we stop spending in this category. So people that are just starting to budget, you know, I think”

it still is for two or three months, just passing on groceries on, yeah, on a couple of things. Because again, it kind of just gets you back into this rhythm of knowing exactly what you have, because it's physical money right there. And so that's really the purpose of the envelope system. But don't do you guys are maybe set seven? You know, the main reason for it is I think you guys have probably

outgrown that main reason. So if you put everything into, you know, a fair one's credit union,

high yield savings account, you'd be great. You would be fine. You would not be doing anything. Yeah, that'll be, that'll work just fine. But the interesting thing is, by the way, for those of you that want to try this, you're just getting started, the actual research says that when you spend cash, when you hand Uncle Benjamin Franklin over to the cashier at the grocery store, you're it activates the pain centers of the brain. It hurts to spend cash.

It does not activate the pain centers of the brain to hand him a piece of plastic. So you spend more. [Music] As your business grows, everything becomes more complex. There was a time when Ramsey Solutions had too many disconnected systems and not enough visibility across the business. We wasted too much

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“at the right cost. Julian is in Houston. Hi, Julian. How are you? Good. How are you doing?”

Better than I deserve. What's up? Okay. So my question is, I currently have a truck. Oh, 38,800, my payoff. There's a dealer interested in purchasing it for 44,000. My question now is, do I have a side-type hustle that I do monthly when I'm off of my work? My side hustle brings me in roughly around 1,300 to 2,000 dollars per month.

My diesel monthly is about $400. It's something to do with your truck. Yes, sir, because my side hustle, I do pressure washing, so I need to told my trainer with my water salts, containers, and chemicals. You can tell your trailer with a $10,000 truck. Right. That was my question now. Should I sell my truck? Yes. Or should I sell my truck and just get a daily

where I don't have to do side hustles no more? Oh, because your side hustle basically paid for your truck

for the payments, the insurance, the gas. Do you, I mean, have you got other debt? Not really, no. What's your income at your main gig? My main job of making an estimate about $60,000 dollars and by weekly after taxes and insurance are making about $1900. Yeah. Okay. No, there's two questions. Should I continue my side hustle and should I sell my truck?

“The answer is you should sell your truck. And if you want to continue the side hustle, that's fine.”

Get an inexpensive truck to tell it with. But if you don't want to continue it,

then sell off the equipment. That's fine. Yeah. But if you want to make some extra money and this

is a good way to do it, pressure washing is a good way to do it. It's a great side hustle. Really good pay per hour. But you got some equipment to add up. But you don't need a $40,000 truck to tell a pressure washer. That's kind of backwards. Yeah. And if you don't have an other debt and you have an aggressive way to get a three-month emergency fund in place to keep moving down the baby step, that's okay. Yeah. You don't have to do the side hustle. But if you

want to keep the side hustle going by getting an inexpensive truck and pay cash for it and sell

the big one, that's definitely what I would do personally. But I've always worked a lot most of my life.

So Kayla is in Boston. Hey Kayla, how are you? I am good. How are you? Better than I deserve. What's up? So my sample and I have been on the house hunt in Massachusetts for about a year now. And unfortunately, we keep getting older bit. Good. So I'm the buying a house unless you're married.

“Yeah, my house is together. I was I was clarifying. You should not buy a home together or not”

married. But I'm very people can buy homes. All right. I see. I see. Thank you. My parent house is in a really great town in Massachusetts. And we've already went to our attorneys and put the house in a irrevocable trust since I am being only child. Instead of putting 20% down on a $600,000 house, should I consider maybe putting 20% down into this house? My parent house because I will be inheriting at one day. No, I would not. No, okay. Because it just it locks you in to that home

for a really long period of time where you and your husband make it married. And in two years, something may happen, right? And you guys may move and want to do something else. So yeah, it locks your money up into an asset that you can't get it out. You can't get it out. It's done versus you guys building a life together and having a home. And then one day when your parents pass, you know, then you can decide, hey, do we want to move and do we want to sell our current home? Take some of

the equity to fix up mom and dad's home or sell mom and dad's home, you know, you actually have options. This just locks you into one option for a long period of time, which I would not do.

“When is the wedding? Oh. Sorry. When is your wedding?”

Uh, next fall. Okay. Uh, this like I 18 months from now? Yeah. Okay. Um, and 30 years of doing this almost 40 now. Um, some of the worst nightmares I have seen are people that buy a home together who are not married. Please do not purchase a home until you're married. It is not together. It is not a good idea. You're going to make a mistake. And you're going to it's going to cost you. You've get you're getting this out of order.

And so yeah, rents for a little bit get married and then you guys go and and look for a home. Yeah. And I think you've been protected so far from accidentally making that mistake by not being able to buy it so far. So, uh, and, and, and, no, I would save up and put as much down as I can put

are not going to do the proper documentation and everything else to make sure they're protected

and you're not either. Um, so it's just best to wait until you're married. And if you're going to buy together. Now, if one of you wants to buy a house, that's fine. Now, the other wants to buy a house. That's fine. What Rachel's point was, but, but on couples should not buy homes together. They're not married. It creates all kinds of relational problems, legal problems, financial problems, and the unseen things that come at you, the unexpected unintended consequences that come at you,

create all kinds of issues for you. I'm begging you. Don't do this. Gabriel is in all

“gust of Georgia. Hi. Gabriel, what's up? Hi, Mr. envy. I'm doing well. How are you?”

Better than I deserve. How can I help? So, uh, here's the situation. I'm active duty military.

I am married with, uh, two daughters, uh, one year old in the three year old. And we own a home, uh, I put no money down in it. I use the VA loan, uh, no debt other than that. That's a 250 $1,000 mortgage, and I owe $243,000 left on it. Um, and besides that, we just have my wife's student loans, which is about 12,000 $1,700 left. So, we're working on baby step two. We're working on paying it off, but I'm thinking ahead and thinking if we have a third kid, we're going

to need a car that can have three car seats, and neither of our cars can do that. Right now, um, how old is your youngest? Well, the youngest is one year old. Okay. So, how far out is this

problem, do you think? Problem. Child. No, the problem is the third car seat, not the child.

“Not the child. How far out the problem is I need a car? How far out is that?”

Yeah, so I mean, I'm not to get, you know, two, two personal about it, but we're, we're not, we don't believe in using a birth control. So, we're going to try natural family. In a minute. Nine months. We'll just say nine months. Okay. So, how much do you have saved towards the next car? Well, I, and Viro right now. Okay, and how much is the current car worth? The, we have two cars. I have a beater. I drive to work. That's probably worth less than $2,000.

What's the end? The quality paid off. And the other cars worth, uh, I can probably sell for $17,000 right now. Okay. Perfect. So, so, for $17,000, and buy something on the whole three car seats for $17,000. Yeah, I go to a used van, a nine-year-old van, Honda Odyssey is whatever. And if you can save up some cash to put with the $17, maybe you could move all the way up to $20. . Hey, what's up, guys? It's Jade Warshot. Now, I know a little something

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have to define the rest of your life. If you fall in behind on your private student loans into

payment plans. Go to yrephi.com/Ramsy. That's the letter. Why are EFI.com/Ramsy might not be in all states. Today's question comes from Carly and New Mexico. She said, "My husband and I are in our forties and we have a household income of $80,000. We are debt pre-except for mortgages on our home and business building. We have a fully funded emergency

fund in about $75,000 in retirement. We have a net worth of over 1 million, but it's almost

entirely made up of the equity and real estate investments. Should we be concerned about retirement if we have all of our eggs in one basket?" I mean, over the long term, yes, I would be concerned. I mean, if you see a plan out of this, where you start to equalize some of this in the next four to five years, I would be more okay with it because of your age and where you guys are at, but I would be making sure that you're funding

15% of that $80,000 in retirement so that you don't become real estate heavy again over the long term, but that 15% will help you balance it out. I personally wouldn't want all my net worth purely just in real estate. I would want cash available and real estate investments, or I'm sorry, retirement investments, like 401(k) is probably there. There's a shortage of cash in that situation. And so that lack of liquidity is going to pinch you even if you have a high net worth and it's all

in real estate. I don't mind it being very heavy in real estate, but being cash poor is what I mind, no liquidity. And so having some other types of retirement investments to provide the cash, that's fine. Because these are not people that love real estate for some reason end up cash poor if you're not careful. Right. Because a lot of the investments, you know, they're not making, they're not providing the cash, right? It's kind of in a business building and unless the business

is paying rent to the building, then you make money that way, but there's no cash coming out of these investments. Nothing to panic, but I would start building a liquidity position is what we would call it, meaning some cash. And that would a good way to do that's exactly what Rachel said. Start putting 15% of your income away into retirement into some good mutual funds. And that, you know,

over time, that's going to be plenty. You know, that alone will make you another several million.

“All right, Dennis is in Atlanta. I Dennis, how are you?”

Hey, Dave and Rachel. It's an honor to speak to you guys. You too. What's up? So I've got a question for you. I am 32. No kids, not married. I'm going to be finishing baby step two this week. And should be done with baby steps three in about two months. And then that will put me into baby steps seven. So I'm kind of not sure what to do. I know I'm going to max out my Roth IRA,

put some money in my work 401k, but really just don't know what else to do at that point. Is it because your house is paid off or do you own a home or are you living somewhere else? Yes, yes, yes, I own a home. Okay. It's paid off. Okay. Good for you, Dennis. Way to go, man. Yeah, well done. Yeah. So yeah, I would max out all the retirement. And then I would have some other investments going in non-retirement. Minimum of something like an S&P 500, but if you

wanted to get with your smart investor pro and open up a brokerage and have some after tax investing

“going in addition to your max. retirement. That's what I would. That's what I did do with it. By the way,”

that's not what I would do with is what I actually did. And that money, the side money is what I started buying real estate paid for with. And nowadays, many, many, many years later, Dennis, because I'm 65, you're 32, right? Yes. Then I was probably about 32 when I started that, but now I've got a lot more of my net worth in real estate than I do in mutual funds. Okay. Yeah, I was going to plan on opening up a brokerage account and kind of start building potentially a bridge account. Yep. You know something

to pull from up. I wanted to buy a second home or something like that. Exactly. Exactly. Exactly what

we did. And again, you can sit down with a smart investor pro. You can find them at Ramsey Solutions. They can help you put all that together and lay out a game plan and start setting some targets on that that you're aiming for. And man, that's that's awesome. Yeah, well done. Very cool. Good stuff.

“Well done. Well done. Brandon is with us in Provo Utah. Hi, Brandon. How are you?”

Better than I just serve. I wanted to say that to you for such a long time. Well, you pulled it off. One goal down. I know. Hey, man. Alrighty. So I'm currently dealing with a problem right now. Well, in my mind, it's a problem. First of all, problem. We're going to be in Utah for about three more years to mean my life. She's going to school for architecture. And then we're headed out

currently what I do. What we're currently looking at right now is we have a lot of good finances

available. We're wondering if we should be putting money into purchasing a home and for it. And now to kind of beat the market. So to speak, this is what everyone's been telling us to do. I don't care what it was rented out. Everyone's arrow. We think. I don't listen to every one of anything. Matter of fact, but everyone says you usually run the other way. No, I wouldn't buy. I said Florida to you ready to go. Okay. So you think just keep on building up our

nest. Take pretty big. Yep. Yeah, the market's not going to move that much Brandon in three years.

At this rate, right? It's not like it's 2022 again and everything's just skyrocketing. It's

“it is slowed down in a good way. But yeah, I think if you guys stack enough cash, you can out”

beat the growth there, if you will. Yep. You can outstack out stack whatever change in the values there are. Yeah. But either way, even if it was going up quickly, I still would not go by a property on another state and anticipation of moving there. I know that's the plan. But three years is a long time. It's also a very short time. But it's a long time. Yeah. So let's make a big purchase like that. No, I wouldn't do it. And being so far from it, I, yeah, I wouldn't do it. Nope,

not the way out of handling it. David is in Chicago. Hi, David. What's up? I'm pleasure to speak with you guys today. Sure. How can we help? I need a little advice. I've been with the company for 16 years and doing this management. They are closing their doors in about four weeks. I have a traditional 401k that the company has been contributing to a significant

contributing to flat amount. And I started a Roth 401k on the side. Also, it's handled with John Hancock. And I was wondering once the company closes its doors, what would be a good option for me if I were to leave it with John Hancock or move it, move it out into something separate such as like fidelity or child slot, something like that. No, I would move it to a more traditional

mutual fund setting. And I would use a smart vester pro that we recommend to do that. The Ramsey trusted ones. And if you've got a Ramsey solution, you can find the person that we recommend. I would move the John Hancock account over there. And your old 401k at your old company, this closing is very simple. It's a direct transfer roll over to a new traditional IRA and your zero taxes. Now, be very careful, David.

“Okay. You need to get in touch with smart vester pro now and get the paperwork filled out.”

And they need to submit that then to the 401k. If you take a check on the 401k,

the government required directly to you, the government requires them to hold with hold 20 percent

and you don't have 100 percent then to roll over. And so that's going to burn you on taxes. So you don't want to do that. You want to directly transfer this roll over into the next IRA and you not touch it. It doesn't need to touch your hands because they're going to hold 20 percent on you. So go to RamseySolutions.com and click on smart vester pro and you can find somebody in your area to sit down and do that and get that opened up. And they'll, you know,

and you can roll your John Hancock thing over there too. It'll be easy. Do best of them. Do both of them keep them all in one place with your smart vester pro. You'll be a much better shaped in both of those situations. So I hope you got the next gig lined up brother. As a dad of young kids, I'm starting to think a lot more about the world of growing up in

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a video news service for pre-teens and teens. Because one thing I know for sure, if you don't teach your kids how to understand the world, somebody else will. And these days that could be TikTok, YouTube, Instagram, influencers, or whoever happens to show up in their social media feed. World Watch is 10 minute videos help young people understand what's happening in the

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Linda is in Houston. Hi, Linda. Welcome to the Ramsy Show. Hello. Thank you for having me. So, I am 35 years old. I have two kids. I have a common law. husband who's been unemployed for 12 years. I've been with him for 15. I have a total dead to 45k in student loans on my car. I have a home that was gifted to me that was worth $400,000. And so, I am a registered nurse. I my father told me, hey, come work for me. I'll pay you

which will make an as a nurse. While you go with nurse practitioner school. So, that's where I'm at

“right now. My question to you is should I pull a healer alone on my home to invest in real estate?”

And what that being said, one that will be helping me with the contracting ability is my father. He wants me to tell my husband to get a job, which my husband has had trouble listening. Your husband has had trouble. What? Listening to my advice on him getting a job. He did not take it. Well, when I asked him to get a job for 12 years. What's he been doing? He was taking care of the kids while the kids were during the pandemic. He had been all

in school, but the kids had been back in school for going on three years now and he refuses to find work or help me out. What's he doing over? Oh, that's usually at home with the kids right now during the summer, but at home, as well, when they're in school, he's up with the home. And he just says, I just, I want to take care of the home and the kids. And I don't want to go get a traditional job and make a living. Yes, I have talked to him and asked him to help me out because we are

still kind of leaving pages to each other. You're a common law. So you guys are never in the mirror.

Correct. You're never in the mirror. No, we're not legally married now. Okay. So I'm curious why you've put up with this for 12 years. Oh, yes. I asked myself the same thing that the fact that we have kids and I have to talk and tell him about helping me work. I'm tired of living in a page to pages. I want to grow. I'm right. I'm 35 years old and I'm already planning retirement. I want my kids to be able to

be financially ahead. You know, just like I was back to my father. Yeah, I also don't want to be married to a not-on-a-log. A lazy guy. Oh. Yes, I agree. I'm not a person of goals. It's just hard to respect a guy that sits on his butt all day. I agree. I agree. Because I wish you had the same. And I'm assuming that attitude of a little bit of laziness and apathy plays into every part of his life. Right. You're married because you know, it's who he is. Yeah. Yes. I make

a decent amount of money. You know, I wish I make more. I'm really comfortable with it. Like I said, we're a pedic to paycheck. One disaster away from everything crumbling. And so the house in your name correct? Yes. The house was gifted to me by my father. Everything's under my name. And in your state, the common law status does not give him any access to ownership in the house, right? No, because it would get this. He doesn't have anything. But now I worry if I do put,

if I don't pull a healer, go on to invest with my father. I would not pull a lock loan to invest with your father under any circumstances. Okay. Period. We don't teach people to borrow money to invest.

We teach people not to do that. But yeah. So basically, you're, you're the owner of the house.

“And so, relationally, this comes down to just telling him he has to leave, right?”

Yes. I don't want to because I believe, you know, every child that serves a bullpen to their home. But I don't want my children to know. I don't want my children thinking this is how a man behaves.

Mm-hmm. The proper thing to do for the children is to not let this model be in front of them.

“Does he have a abuse problem? Is he abusing alcohol?”

Uh, he's had a pastage substance abuse. You sure it's in the past? Yes. So, and one can allow it's currently. Once in a while, that's not in the past, by the way. Now, if you've been an abuser, if you've been an addict and you're drinking again, that's not in the past. Okay. Um, okay.

Well, I'm not sure exactly what our question is on the table. But what I would tell you to do is, uh, no, I would not take out a home equity loan to invest with your father,

borrow on the home that he gave you this paid for. That's a little weird. Okay, not even thinking about

that one, um, period, um, as far as there's going to be, uh, I think some, some absolutes that are drawn. Yeah. I mean, I, you know, I think out of the direction of a good marriage counselor and I would go see one, he's not going to go. But if I were you, I would get somebody other than a couple of people on a podcast or your dad to advise you on this. And, uh, relationally, what we're hearing, though, is, uh, is if we were in that situation, we would say, um, you're going to have a job

working 40 hours a week, uh, sometime in the next, uh, 30 days, or you're going to have to leave. And that's what I would have done 11 years ago, um, not not sit on your butt for 12 years. Mm-hmm. So, um, this is now your fault. It's no longer his fault, because you've tolerated it this long. So, now you've got to correct your problem that you created by drawing a line in the sand.

“Yeah. And I think that's what a good counselor is going to tell you.”

Um, but you ought to have someone other than us, tell you how to do that or other than your dad. Yeah. And I was trying to flip the script in my head if a man called and said, or paycheck to paycheck, my wife refuses to get a job, x, y, and see, you know, um, does that make a, you know, I mean, I'm, I'm playing that in my head.

If there's a difference there, I don't know if there is. But I think the problem is,

is that I don't think this guy wants to be, I don't think this guy's asking to be a stay-at-home dad. I think this guy doesn't want to work. That's what I'm saying. That's the difference. And when one spouse is the only income earner and is struggling and reaching out to the other spouse, I mean, I know they're not married and saying, I need help. We need help to get us out of the situation to get out of debt. It's kind of all hands on deck. Do you know what I'm saying? Like,

that's the attitude approach of a healthy marriage that we look at our situation and say, okay, what do we have to do? Instead, she has three dependents. She's, yes, and that he's, he's doing nothing. Nothing. Nothing. Nothing grows me bananas. I know, yeah. I can't handle it. And just a dude. I mean, when you said that, I was like, it's so true. It's one of the most, that would be one of the most unattractive things. Just lazy. Do you know what I mean?

It's a hang dog in the sun, on the sun. Just lazy, I'm like, man. That's it. If you had initiative, did you do anything like, you'd already mean within another context, I'm like, I'm trying to like, I'm playing gymnastics and I had a little bit of how I would approach it if it was something else and something different, but I think the problem you're going to have is this. Okay. Very little that you can do in this. Once this much water is under the bridge,

is going to work, because we have 12 years of the same pattern of script. Yep. And now to flip the script and go, oh, you're going to get a chopper. You're out of here. It's just not, it's just going, it's not going to go. It's not going to happen. It's not going to happen. He's not going to go, oh, you know, I was just thinking the same thing this morning. No, that that's not going to happen. And help provide for my family. Yeah, you know, no, you wouldn't have anywhere near the fuse on this

bomb that you'd have around here. Man, I think you got Linda who's like, killing it, working hard, a nurse, head and towards the nurse practitioner. Yeah. You got paid for $400,000 a house.

“Yeah. By the way, I think you need to pursue a nurse practitioner and not your dad's business”

too. You didn't mention that, but I'll throw that in just for the fun of it. Linda, I'm sorry. I love the independence that you can have and that you have and you're going to need it. Yeah. And that's where it's going to take you. So yeah, I, I, I don't think this as they say leopard is going to change his spots. I got a feeling that as you can go, oh, and I was just thinking, no, that's not not going to come up that way. I think the old boys will have to find somewhere else

just take his naps because he takes a lot of naps after he drinks a lot. And she's not being truthful. He drinks a lot. Still. Yep. Linda, I'm sorry. I appreciate the mom heart, though, of

you, Linda. And for the kids. You, yes, and you being in the healthiest situation. So if it's

“situation for you is going to be the best thing for your kids, but I would go get some advice from”

from a counselor. I would sit down with someone a professional and talk it through. So then we'll leave that past, or maybe let's go out there. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio. I'm Dave Ramsey, your host. Thank you for joining us. Steve is in Rochester, New York. Hi, Steve. How are you? Hey, Dave. I'm great. How are you? Better than I deserve. What's up? I have a business that I've owned for about eight years now. Looking the last 16 months or

so, it's taken a hit and it's basically breaking even, and I haven't been paying myself throughout

that. So, you know, I'm trying to figure out it's listed for sale, not probably not going to get anything close to what, what have gotten a few years ago. And I'm just trying to, you know, get some guidance on what I should do next. If I should try and pour some more money into it, or go look for a nine to five or start an company. What kind of business is it, Steve? It's a protein supplement company. Okay. That you make or that you're sale.

Can you repeat that, please? Do you make the protein supplements or do you just sell other peoples? We make it. We have a manufacturer and we sell it. What happened to the sales? Why is it down? Direct to consumer. We were using a 3PL, 1 3PL, and they changed. They got bought out and then bought out again. And they threw out about $350,000 worth of inventory. We hired attorneys onto the whole process, which was expensive. And we were at the stock on pretty much everything for

six to eight months. So now you have inventory back? Now we have most of the inventory back.

“So why can't you sell it? That's why we'll momentum. We're trying, but that's why we'll momentum”

hasn't gotten back up to speed as why to where it was. I don't know. I don't know if people are spending less on it. Well, spending more. Why isn't your selling? Probably marketing. Getting the name out there or back out there. How are you? I mean the other company was doing all the

marketing for you. You've never had any experience selling your own product? Well, we have.

We used to use influencers and we stopped using that because stopped using that because it was moving and have great experiences with some of them. Because it didn't work. At first it worked. But after that it didn't. Okay. So it sounds like you know how to make

“protein supplements, but you don't know how to sell them. That's what it sounds like.”

Neast specifically to go out. You own the company. Right. I don't know. I said it and it's saying you need to go door to door, but you ought to have an idea how you're going to directly get this thing that you created and you created it with someone in mind and who are you going how you're going to get it to them. That's marketing. Right. Right. How many people work on the team's team? It's small. It's about. Not about. It's four people. Okay. So after payroll and expenses and everything,

you guys are breaking even. Yes. Yeah. How long has that been? How long has that been? How is that much product moving? Just on your website? Yeah. I don't know, let's say. And how long has it been since you've had an inventory back? Almost about one month. How long ago did you start this company? Eight years ago? You told me that. I'm sorry. So eight years ago if I had talked to Steve, would he have been more excited than he is right now? He sounds down in the dumps. Yeah. Very much so.

company and we have a five month old. You've been through a lawsuit and all of it. It's just

taken you out. Yeah. Yeah. It's the most different sale for since we got an inventory back in stock. It's not been much moving. So it's, it has been pretty frustrating. Well, it's not, it's not really much of an asset to buy because it's not profitable. Right. I don't know why anybody would want to buy it. Unless they would just want to buy the inventory and then yeah. Yeah. And the formula is in recipes or whatever, but um, okay. So Steve, so what, um, next steps for you, you're wondering,

your main question is, do you keep putting money into this? No, not unless you have a reason to believe it's going to work. And right now, I had a reason to believe it's going to work.

So, okay, Henry Cloud says in his book, "Nississary Endings" that we end something, a relationship,

a job, a business, a department, and employment, whatever it is when we lose hope that the situation is going to improve. And if you, and I have not heard a single thing talking to you, then you have any hope this is going to work. I know it's been full, well, I'm just saying it's been four months since everything's been back. But there's no light at the end of the tunnel that's not going to come in current. Well, I'm just wondering, Steve, if you were killing it right now,

would you still love the business? Or do you just want out in general? I probably wouldn't be,

“you know, I think that is a company before and was making pretty good money that. Okay, so you just”

want out in general. Even if it was doing good, owning your own company and doing all of this,

it's just, it's not, it's not fun right now for you, in general. Hello. He's gone. Oh, we lost him. Oh, did I offend him? I'm just kidding. Yeah, I doubt it. Uh, yeah, no. That's my job. Um. Yeah, I would just tell him, I just wonder if there's strategies you go back to for 60 more days to see if there's anything. Tell me three things you want to try to keep it open. That's right. And I can't get any of that out of it. Yeah, no, he seems like he's done. He seems like he's done. He's done. So what do you do?

Sell off the inventory to another company. You haven't been trying to get the capital. Keep your website open and shovel it out of your basement. We got to go. Steve, you there. Wait, presto. We got him. Okay. Good. Steve, you there. We got your back. Oh, they're all right. Okay. Okay. So do you have three moves you can make to try to salvage this thing and get it profitable that you want to try or do you want to close it?

My gut instinct is to close it and or sell it, but you know, to put money into it in three months.

“And you're you don't have you don't have anything that gives you hope. That's what that's what I'm hearing.”

Yeah. Yeah. And you're and I'm also hearing in your voice that you're out of gas. Yes, you know, three, you know, with the five month old and staying up till 2 a.m. 3 a.m. to try and make this work. It's it's my family and then face are more important. Yeah. What is the, what is the value of the inventory? It's about 350,000. Okay. Yeah. I wonder if you can sell that somewhere. I think you can work that as your side hustle just running now for your own website with no overhead and get your inventory back out of it.

You're probably going to make more that way than you will trying to sell it sell the business. Because I don't think the business is a viable purchase because it's not got profit. And businesses that aren't profitable are called a hobby. So yeah, I'd go get a nine to five and come in out the coal for a while and heal. You may go back to being an entrepreneur someday. That's not a sin. But it's not unusual at all for somebody to take five years and go back in

out in the marketplace, work for someone else, get their emotions healed, get the liquor wounds, as they say. And, you know, you've got these responsibilities that are weighing heavy on you.

“So that's what I would do. Took a minute to get there. Sorry about that.”

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[Music]

Hi, thank you. What's up?

I'm calling my husband and I have been following your principles for the last six years.

We just paid off our mortgage. Yeah, I'm really excited. And we've been investing 15% since we hit baby set four. But now that we paid off our mortgage, we've been looking in how to like optimize that investment. We've been investing between Ross and Traditional and just like a split there. But now we just found out that there's a four Roth, there's an income limit.

So we cannot invest in the traditional or the Roth. I know there's a back door, but the question is, is there a recommendation on percentages of the 15% to invest in traditional or

fact door for 100% in the Roth? 100% in the Roth, your 401k ought to be Roth.

Everything ought to be Roth if it can be. Is Roth available on your 401k? It is, but we don't qualify because of our income. That's not true. 401k does not have an income limitation. The, the traditional, but doesn't the Roth, the Roth, Roth individual has a $200,000 married filing jointly limit and you have to do a back door, but not on the 401k.

I do a Roth 401k and my income is way above that. Okay. So just, the whole 15% in, not put everything. I'd max out your 401k.

Okay. All Roth and then I do two back door Roth IRAs, individuals as well.

Okay. And if you've got money, if you have the money to do all of that and still do some of the

“other things you want to do with your life, then that's what I would do. What's your household income?”

Um, it's, it's variable because of a commission structure, but anywhere between three to 400,000. Okay. Yeah. You've got the money to have a wonderful life and max out all your retirement. Okay. Yeah. So 100% Roth and back doors. Yeah. And then if you wanted to be on that test that open up, I mean, I mean, I mean, it would be like a bridge account, I guess, or, you know, just a bridge account, put some money in mutual funds that are not in return.

You can use because if you go down this rabbit hole, there's the mega back door, for, I mean, there's all these other elements that are so such high numbers and I'm not even, we've, we've talked about this on the show, high earners. There is a point that you can max out all these thing, you know, there's all these elements of massive retirement of essence, but it's all stuck till you're 59 and a half. So there is a point of maxing out everything from the traditional sense.

But then there's all these other layers that you could do, but probably you would get your, at your level of income, I probably would not do mega's. Yes. But I would just take your full 401k at Roth and take your back door Roth's individuals. It's your, at your income, you'll still have plenty of money. You'll do some other investing, some other generosity,

“some other enjoyment, and you'll have plenty, you should have plenty of wiggle room and they're”

making 3,400,000. So yeah, sit down with your smart Vester Pro. They can walk you through every single bit of that and show you how to do it. Jarrett is in Shadnauga, hi Jarrett, how are you? Hi Dave, good, how are you? Better than I deserve, what's up? Um, well, I just want to say what an honor it is to talk to you. Um, my question is, so right now, I'm 30 years old. I'm in a pretty high pain career. I would like to make a 10 year plan for myself to transition to a more flexible career path.

So that I can spend more time with family. I'm just wondering the best way to think about that um, it'll be probably, I'll be making about a fourth of what I'm making now. What do you make now? Um, right now, I make about 194 after taxes. It's like 170, a year. How old are your, how old your family? Um, I'm 30. My life is 25. We have a one year old and we have another daughter on the way. And you want to transition your career to make less

“money so that you have more flexibility. How many hours a week do you work?”

Um, right now, I work full time. So 45 to see. You make $20,000 a year, we're making, we're working 40 hours a week. Yeah, probably more like 45 to 50 hours right now.

Um, probably slightly over 200. Yeah. And what are you doing? What's your career?

Um, I work in finance and accounting for a manufacturing company. And where did you get the numbers that it's going to be a force? Like, were you looking at a specific role at a job that's 20 hours a week or something? Like, what, give me the reasoning of when you said it's going to be about a force? Yeah, I want to be a soccer coach and be like the home school our kids. Um, so I'd like to transition to that just to be with family more. Okay, but you have a

one. So you have the one year old who won't be in school for another four to five years, right?

Right. Okay. So is that what you're thinking when they start kindergarten, but you won't be

with your wife be home schooling or will you? Um, my wife is going to home school. This is, I'm trying to find like a 10 year plan, hopefully. Okay. So I think I have about 10 years to, okay. Yeah, I mean, I would just worry about it. Work my, yeah, work hard. Don't overwork yourself, but work hard, save, get out of debt, pay off the house, get yourself in a position that, um, yeah, that if you decide to pull back career-wise at 40 and make a four that you'll earn enough, but I just don't

stay here with soccer coach at 50k. Where are you going to be a soccer coach for 50,000? I was going to do like use club teams and probably a local high school around here. Okay. All right. I, um, yeah, I, it doesn't, it doesn't compute with us. No.

“And you're, let me just tell you, I think in 10 years, your life is going to look so different.”

I think you're 30. You have a one year old. I think by the time you guys have another couple kids, they start school, you start your life. Things may shift. So you can- There's a lot of different ways to accomplish similar goals that aren't as destructive as this is. So, um, I mean, you can soccer coach on the side and take- and make a shift in your career where you've got more flexibility in your current career and you're still making the same kind of money.

Mm-hmm. I think that's an entire possibility. This idea that you somehow have to come home and, you know, destroy your earning power so that your children turn out is not a truth. That's not a true story. That's not true. Okay. Um, men have worked 40 hours a week for, uh, since time began

“and their children turn out. And so this idea that you have to be at home to, um,”

nurture is not true. No. But what I would say is true at 40 to have the flexibility, just like you're saying to be able to leave an office at 33 to go and coach your kid soccer team on the side as opposed to this, you know, to leaving the office for good. Yeah. Right. Right. Right. Right. Right. I'm not a problem with that at all. Yep. That's fine. Yeah. One of the reasons we work and build up a nest egg and some wealth is to give us some flexibility. Flexibility. And Jared, you may look up,

and in an accounting, you could have your own accounting firm in 10 years and do the business you want to do. You know what you mean and create your own destiny. Like it's a lot better idea. Yeah. There's a lot of avenues here. Um, yep. So I would say, no, and again, money is not everything. We're not saying that, but it doesn't say that at all. No, but it does give this, this is a, it's a false narrative. Yeah. That you need to cut your income to a fourth in order to be a good

dad. That's right. In an order to be a being called flexible and in order to homeschool your kids. And in order, I don't know what you're reading, but that's just a false narrative. Um, and so

never seeing your children and working 80 hours away can be more Catholic as the other into the

spectrum. We don't endorse that either. And endorse that either. The reason we live like no one else is so that later we can live and give like no one else. And that involves some flexibility. But I think

“you need to be careful with narrative. You're buying off on. That's, that's what's bothering I'm”

making with this. Hey, guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles. We use on the

It's fast, simple, and free to use. Go to RamseySolutions.com and try Ask Ramsey today.

That's RamseySolutions.com. To tell it's summertime in the lobby of Ramsey Solutions, there's a bunch of folks showing up today. And we do the show from one to four central time every day, Monday through Friday on the glass. You're more than welcome to come by and get a free homemade chocolate chip cookie and some coffee, and I'll visit the store, visit the museum, and sit and watch the show. And also whatever you

call that thing back there. The Smithsonian of Ramsey. The Smithsonian of Ramsey. That's it.

“Our history wall. The history wall. The wall of history. What do you call that if it's not that?”

I don't know. Anyway, so also in the middle of that lobby is the debt free stage, which is where Aaron is standing on the debt free stage. Hey, Aaron, how are you? I'm doing well. How are you guys doing? Better than we deserve. Where do you live? Great. From Columbus, Ohio. Very cool. Welcome to Nashville. And how much debt have you paid off? Payed a $31,000 in 30 months. Good for you. And your range of income during that two and a half?

$35,000 up to $38,000. Wow, that's amazing numbers. $1,000 bucks a month.

Oh, you lived on beans, not even beans and rice. I moved into an apartment above the vet clinic that I work at that involved not paying any rent or utilities in exchange for taking care of important and hospitalized patients overnight on the weekends. Wow. You went all in amazing. What kind of debt was the 31,000? 23,000 of that was a car loan and then the 8,000 were two student loans. Wow. Very cool. Did you go to vet school? No. I'm at that tech. That's like a

care fight. Okay. So girls, I was going to say that's pretty good. 8,000 for veterinary engineering. You got off the other way. It's good. So how old are you? 28 years old.

“Very good. Good for you. So what happened 30 months ago that made you get so radical?”

I took financial piece of university through my church and just knowing other people who were actively getting out of debt or people who had gotten out of debt, who I knew, who were able to do that really inspired me and helped me get a jump start on getting out of debt. And what a cool opportunity to be able to get a free apartment for a little while and do what you love anyway. You love animals. It's been a huge blessing. Yeah. That's very cool. That's a, that's a, that's

all. It's a creative way. It's always fun to hear what people do. You know, when you hear that,

you're like, well, there you go. How great for you. Yeah. You don't have to pay rent. It's not a forever thing. But for a little while, that was fun. Absolutely. Yeah. Good for you. Okay. So in the 30 months, what was, what was the hardest part, would you say? Your 28, you're like, I'm, I'm living on nothing, doing this step free thing. What was tough about it? I would say staying motivated at first there at the beginning. It just seemed like a huge mountain of climb.

But as I kept going as the snowball happened and I got the student loans taken care of that was very motivating. Just to watch my payments, be able to get bigger and just to watch my debt just in decrease. Yeah. Just watch it go down. Yeah. And the keeps your motorway. It keeps your moving. Yeah. And it's like, I can see the end. I can see the end. I can do this. I can do this. Yes. That's called hope. Yes. Very cool. I'm so proud of you. Way to go. Who was cheering you

all in this gang over here in the, in the peanut gallery? Yes. Yep. My whole family. All right. It's awesome. Very good. And they all came down with you to cheer today. Yeah. They did. Yes. Very good. So mom and dad are proud. Yes. Yeah. You're living in the vet clinic, not their basement. That's good. I like it. Very cool. Now that you did all this, how does it feel? Fantastic. Was it worth it?

“Yes. It feels very freeing. Yeah. Yeah. Very cool. So what do you tell people the key to getting”

out of debt is having and sticking to a budget? It was very helpful. There's freedom within the budget too. The budgeting just gives you a plan for your money so you can still do the fun things you don't want to do and still save for the things that you want to do while also being able to put pay your bills. Yeah. And we're doing it on the every dollar app or on the paper. Yes. I use every dollar. Okay. All right. Very cool. Good for you. So great. Very, very proud of you. And that's awesome.

Good work. Okay. So the other 20 something year olds that are listening and they have student loan debt, they got correlones, all the things. What would you tell them? If they're sitting here thinking, there's no way I can do what Erin did. Like she just she killed it. She sacrificed so much and got out of what $31,000 a day. I don't know if I can do it. What would what encouragement would you give

to decrease your living expenses and find anything you can do to increase your income. So if I was

able to do this, doing things that I love. I auditioned a living above the vet clinic. I've also done a lot of pest sitting on the side, which I love doing that anyway. Yes. Yes. I love that. People can find a side hustle that they're naturally good at. It's what they can do well. You know,

“and then you get paid for it. That's what you're saying. That's awesome. We're so perfectly perfectly.”

Well done, Miss Erin. Proud of you. Good work. Good work. And onto everything else in your life from this point forward. You got everything's wide open now. Yes. Congratulations. Well, well done. All right. It's Erin in Columbus, Ohio 31,000 dollars paid off in 30 months for those of you

slot math. That's a thousand dollars a month. Making only 35 to 38. She did this. It's amazing.

This is very cool. Those numbers are unbelievably cool. Very good work. All right. Erin from Columbus, counted down. Let's hear a debt free scream. Three, two, one. I'm debt free. Yeah. So it's done, ladies and gentlemen. That's how it's done. Love it. So we get to meet the gentseers and the millennials that are not victims and that are not entitled and that are actually go getters. They get up, leave the cave kill something and drag it home. She's obviously one of them. And we get to meet them. And so we have

a distinct advantage over a lot of people out there because a lot of people can believe that these two generations are are all entitled breaths. 11, there's basement or something and they're not. There's a high percentage of them qualify like her. Yes. And we got a bunch of work in here in that age group,

“too, and they're incredible. Well, and I think what's always impressive is when you choose to do”

something when you are on the on the younger side of life. You know what I mean? Like it's one thing when you're in your 40s or 50s and you're like, I got to get my crap together because of some retirement coming all of it. But to have people in their 20s, like step into this and be like, you know what? I'm going to do it early because it's what everyone else wishes they had done. You know, they're like living out. So I had met you when I was 19. Yeah, that's so many people. That's right.

Yeah. And for Erin to think about at 28, you think 10 years from now, 38, 48, 20, like what she can save and put away. Like she will. She'll be, uh, so be a baby steps millionaire. Honestly, a no time. Like it's, it is wild what your income can do when you have no payments. Yep. Yeah. And what your career will do? Yes. It's because it opens up. You don't have to sit in a bad situation. You can make different choices on where you work, how you work, who you work with. And because you're not stuck,

you're not dependent upon, oh, if I lose one paycheck, I lose my car. If I lose one paycheck, the student loan people are going to come knocking at my door. I'll lose one paycheck. We're

“going to discover that Samuel Jaxons actually in my wallet. You know, it's a master card. Right?”

Who wants in your wallet? Apparently you. You know, and so yeah, all that. All that's gone. And so when you learn to do what she did, which is take a very intentional approach, step by step, systematic, like she did, uh, follow the process, didn't argue, didn't try to make up her own thing with some math thing she read on TikTok. She just said, I took this class. I'm going to do this. Yes. There's real simple. Mm-hmm. And uh, you know, there's a beauty to that simplicity.

Absolutely. Well, and the consistency. And over time, like it's not, it's not fast, right? I mean, 30 months, like she, you know, over two and a half years. And it's, that's a, when you're in the grind of that, that's long, right? You can look up and think two and a half years ago from sitting here and like, oh my gosh, I went so fast. But when you're in the middle of it, like she was saying, it can be hard. So the, the perseverance and the motivation. Yep. I think is great.

Yeah. And I think another funny thing is being on this show and you get calls from all generations. And I'll say, I think we've met as many entitled boomers, calling in, expecting certain things as we have Gen Zers. You know, I mean, there is a, uh, an amazing thing that regardless of your age or generation, the people that win on this stage, then I think the consistent thing that we see over and over again, regardless of age, is that they believe they can do it. And she looked up and said,

you know what, I'm going to change something for my choice. And I'm going to do it. And she did it. I'm going to take this. It's amazing. A buddy of mine said, he said,

it never worked. You're stuffing the work day, even till us submitted myself to the program.

And just like, yeah, I had to submit myself to something that's different than I thought, and different than my arrogance. Yeah. That's very congrats Aaron. Very cool Aaron. Proud of you. Awesome.

the calendar, more time with your people and way more chances to make memories. But, you know,

what else? There's more of spending. Oh, between the extra groceries and gas and camp fees and family trips, it all starts to add up so fast. And before you know it, money stress starts to steal the fun out of everything. And that is why I love the every dollar budget app. Because it helps you plan your money, track your spending, and find more margin in your budget so that you can put extra cash towards the goals that matter most. Enjoy your summer without the money stress.

Download the every dollar app in the App Store or Google Play and start for free today. Our scripture of the day teach me your way, Lord, that I may rely on your faithfulness. Give me an undivided heart that I may fear your name. Bebe King said the beautiful thing about learning is nobody can take it away from you. All right, up next, we have Chase in Columbus,

“Ohio. Hi, Chase. Welcome to the show. Hey, guys, how are you? We're doing great. How can we help?”

So first off, I want to say, I'm sorry if I stutter. I started when I get nervous.

Oh, yeah. I feel a little awkward here. No worries at all. Dave just screwed up his whole in here. So he's he's having issues too. So don't he? You're a good company. Don't worry, Chase. Don't worry. Okay, so my wife and I, we make decent money. I mean, I would say it's okay, money. How much is that? Awesome. So we make 118,000 a year combined. Okay. But we just paid off her debt, besides her car, which we still owe about 18,000 on it.

And now we're transitioning into my debt. I made a bunch of stupid decisions when I was around 23. And I have three items on my on my credit that are charge offs and those charge offs total up to about $4,000. And then I have about a additional $3,000 that is medical debt. That is not charge offs. Though my question is, how do I go by paying these off to be able to boost my credit and have be able to buy a house by no later than February? Don't know if you're going to make it

about February, but we can help you get it cleaned up. And then we'll see how quick it

“changes your credit score, okay? Of course. So the $3,000 in medical, why has that not been paid?”

And how long ago was that? So it was about two years ago, pretty much, it came down to, I used to work in law enforcement. I got injured when I wasn't working. And then definitely leave my job. I wasn't able to return just due to the injuries. And then we just, we lived pretty much penny pinching paycheck to paycheck. I was trying to do odd than then jobs. Okay. So that's a great debt. But it's not been written off or charged off yet. As far as you

know, yeah. So do you have a contact point on all three of these debts? Someone to do. Yes. Okay. So call them up and ask them what it takes to clear the debt or what they will accept to clear the debt. Okay. They're all bad debts and a bad debt made good even if it's settled is about the same thing is paying it. So that $3,000, they might say, oh, we've added charges and interest in its $8,000. And you may have to negotiate down and say, okay, I can't give you $8,000, but I can

give you $3,000. If you'll take the original amount, I can send you a check today. If you send me that in writing that you'll accept that as settlement and full. Okay. Okay. So in all three cases, you're looking for a couple of things. One is you need an email or something in writing. This says, we, the organization will accept X amount as settlement in full. And then you keep that piece of paper and hard form printed off in a file for the rest of your life.

Because these people forget. They screw up. They call back. They go, oh, we didn't settle that.

“Oh, that guy didn't have the right, sorry. I got it in writing. Okay. So you need to get it”

handwriting. And then the second thing is they will ask some of them will ask for

settled amount. Do not allow them to have electronic access to your checking account. They lie.

They will clean you out. Okay. Okay. So instead, you can wire them the money or you can buy a prepaid one time use debit card for the exact amount and put it on that and then give them that card number. But don't let them use your regular debit card and don't let them you don't give them your checking account number anything like that. Okay. Okay. So in writing, no electronic access, you're checking account. And then you've got to deal on all three. The fastest, as soon as you do that.

And then, you know, go ahead and put in and then you can, and you can even put in the in writing that as soon as we receive this, we will enter on the credit bureau that it was paid in, that it was settled or that it was paid in full, whatever. Settled in full is fair. That's fine. But that will

remove the damage, the bulk of the damage. So if we were going to put it on a scale of 1 to 10,

as an example, a bad charge off is an eight or a nine. If 10 is the worst, okay, which is where you are today, a paid off charge off is a three or a four. So it still damages your credit because this really happened and it shows that you didn't pay a bill, but you went back later and paid it.

“But it's not nearly as bad as where you are today. And that's what I'm saying. I'm not sure you'll”

quite be ready by February. Yeah, and do you guys have an emergency fun chasin in a down payment? Will you have all that by February? Yeah. So we've actually been looking now to go look at houses. We actually have $40,000 for a down payment and then we have 7,500 per side specifically for my debt, meaning we can go pay off everything and we're lucky enough that my in-laws, they have

like an in-laws' wheat for their house. We're able to live here for free. They offered it to us instead

of renting so we can fix everything up and be able to save for a house. So everything can be paid theoretically today. I'm sorry. When I was going to say, it takes usually around six, eight months, six to nine months, with for the credit score to go undetermined, which all the accounts are closed. So yeah, you guys will be right on that line. Yeah, that's why I'm keep saying. I don't know if February is going to work. It might be me. But you've got to do it anyway. So let's go get a

cleaned up. You'll get a cleaned up and get everything shut down. And if you have no other active accounts, making sure everything's closed. And you map when you may see it go all the way to undetermined, which is the best possible scenario. Because if they pull your credit score, when you're trying to get a mortgage and it's bad, you know, it's, it's going to hurt you more than having an undetermined credit score at that point. Exactly. When you can do manual underwriting and have

two years of back bills that you're showing that you pay, right, cell phone, insurance, electricity, so on. Exactly. Hey, we wish we could get to every call and question, but we can't. So we built a thing called Ask Gramsi. It's our AI tool that's free. And it's built and trained only on proven Ramsi principles. The data that AI is accessing is only Ramsi data. So you're only going to get a Ramsi answer. Ask Gramsi. It's free. Ask your question at RamsiSolutions.com

“or click the link in the description. Jada's in Sacramento. Hey, Jada, what's up?”

Hi. Thank you for taking my call. Sure. How can I help? So my husband and I decided to pay off our 30,000,000 debt this year and we paid $6,000 progress so far. Good. So we're doing really well. And he's the one working I stay home with our one-year-old. He works a lot. He can use almost two hours to end some work. He had the sidekick. He's really busy. So he feels like he should have a good, you know, size a lot

of fun money. We haven't budgeted up until this much. And so that ends up being $366 for each of us, which I feel like is a lot because I want to, I don't know what it wants to get off of that. And so my question is, what do I do is that they're at $60, right? They're at the debt, do I try to save it? Do I, you know, go blow it somewhere? What should I do? Well, have you guys, have you run now? I mean, how much debt do you guys have left?

$27,000. Okay. I mean, if I were you, I think having some level of money right for yourself,

“because you're going to have to be buying, you know, there's things you have to buy throughout the month”

for yourself, which is fine. But just to blow money for the heck of it while you're getting at a debt feels wasteful to me because as you're looking and running out the numbers, both of you, I mean, the, the math is the deeper you sacrifice and the more money that goes at the debt, the faster you're going to get out and the faster you can get back to a great life without payments. And so I guess that's a decision that you guys have to make because the more you

spend and just enjoy the longer it's going to take you guys to get out of debt. And I know he works hard

fun money budgeted. I'd back it. I'd back it down, less fun. I mean, it's almost 700 bucks a month.

“Yeah, it's less fun. Yeah. And so that was the quote unquote compromise. He wanted 10% at first,”

which is just crazy. Well, he's not on hold. Yeah, you're the only one to do in this.

Yeah. And so it feels like if I, you know, the problem is not the fun money, the problem is whether

or not he's engaged. Yeah. Once he's engaged, then we don't argue about this. He's not engaged. You don't need a timeline in it. And to say, here's an aggressive way or aggressive time to get

“out of debt. And that's how he needs to believe that this is worth it. And he doesn't yet.”

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

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

walk daily with the Prince of Peace Christ Jesus.