You Can’t Hack Your Way Out of Debt

>> Brought to you by the every dollar app, start budgeting for free today. [MUSIC]

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

From the Ram Z network and the Fair Wins Credit Union, this is the Ram Z show. Ram Z show, Rachel Cruz, Ram Z personality, and the one that's selling on there. My daughter is my coach to bed. Open phones, a triple eight, eight, two, five, two, two, five. Robert is in Philadelphia.

I Robert, how are you? >> Eight, one in Dave. >> What's up? >> So I'm calling to get a little advice and your opinion on a financial. I would categorize as a disaster that I'm going through currently.

>> Okay. >> So I am 34 years old and I am married to my wife. We got married back in 2018. And it kind of goes back to the relationship with her family.

“So I met her, my in-laws, her parents back in 2010.”

They lived a very lavish lifestyle.

And again, I never passed judgment.

But I was like, well, my father and mom does very well for himself. He was in the real estate business. And what I would say, a large portfolio of commercial real estate. Fast forward to two years ago, I discovered that my father and mom back in 2015, or 2016, basically got himself in a giant mess with the IRS.

He owes currently several hundred thousand dollars in taxes. And what he did was he put my wife, his daughter, and her two sisters. Basically transferred all of the assets into their name. And my wife, she did sign documents. It wasn't that her signature was forged or anything.

But she kind of previously just said, hey, it's my father. He asked me to sign documents. >> So he was off voting assets into his kid's name to keep the IRS from taking the assets fraudulent. >> Yeah. >> Okay.

>> This is fraud. Okay.

“So basically -- >> How old was your wife at the time?”

>> She was, so this was 2021, so she was probably -- >> No, no, no, no, you said 16 and 15 is when it happened. >> Okay, so that's when she -- >> She signed the documents after you were married? >> Yeah.

>> So, and I'll get to what I've discussed with attorneys.

But when fast forward, he had taken out a $10 million loan out under these girls names,

which they personally guaranteed. And the buildings that were in the LLC that he started, they have been taken. They are up for share of sale. Now, I have talked multiple attorneys. We filed tax to separate our house is in my name.

I am financially -- and I know we're married. But I am financially fine. I have a lot of investments. I have a lot of retirement savings. I do have another piece of real estate that is full in mining only.

No mortgage. And multiple attorneys have told me you have nothing to be worried about. >> I agree. >> We feel that your wife should just file chapter seven. And I guess this isn't more so a financial question, even though it is,

but I kind of just wanted your input. Like how do I navigate this? I have this -- I mean, me and my wife are -- you're okay. >> So, here's the thing.

And she thought to see it by her father, basically.

>> Yeah. >> She went in naively. >> To sign whatever he just said sign. >> Yeah. And he is arrogant enough.

He thought this was all going to work out. He probably did not set out to harm his children. But he's just an idiot. >> Correct.

Now, gosh.

“So, the properties have all been foreclosed on there's $10 million in loans.”

Then properties have not yet sold after foreclosure. >> Correct. >> Correct. >> Okay. All right.

So, the way the process will go down is the properties will be sold. You have any idea what this portfolio properties might be worth.

>> Approximately $7 million.

>> Okay. All right. So, let's pretend that they brought that. And then that would leave $3 million unpaid. >> Correct.

>> Okay. And I'm guessing that the other siblings don't have any money and our chapter seven bankruptcy as well. >> That is correct. >> Okay.

All right. And so, let's just switch shoes a minute and put on the bankers shoes. Okay. If I'm the banker sitting there, once I get into this, I can tell what happened.

>> Okay. >> That the dad is a shyster.

“And he dumped his kids on the railroad track and here comes the train.”

>> Okay. >> Okay. >> If I'm the banker, I'm looking at that. And I know that that actually happened. >> But do you care?

>> And I don't care if your wife had $3 million. I might not care, but your wife has nothing. And so, I probably 98% chance if I'm the banker, I'm looking at this, I'm going whatever I'm going to get out of this deal. I'm going to get out of these properties because these three kids are all following B.K.

>> Okay. >> And what that means is if that guy really believes that or that gal, the banker, then you might for X number of dollars buy out her position, release her. Okay. And so, what I would do is this, I would wait right now.

Let's let the whole thing go down and don't bother. I wouldn't file, filing today is premature.

They may never come after her just because they know she's not at rich target.

>> Gotcha. >> And if they did, you might offer something absurd. $20,000. And they might go away. Just something symbolic, you know?

That's all it is.

“Because if they don't take that 20,000, they're going to get zero.”

Because your wife has no assets. All the assets are in your name. You're protected. Does she have any assets in her name? >> No.

The bankruptcy attorney we sat down asked for like, you know, assets and liability. And my wife is worth 29,000. >> Okay. There it is. I'll end off.

Yeah. Okay. And Philadelphia, I don't know what, I'm Pennsylvania. I don't know what your personal exemption is. But she probably gets to keep most of that, if not all of that.

And the personal exemptions in the bankruptcy. So, I'm not going to wait 10 years for this to unfold. But right now, I'm not going to let how pissed off I am about this. And the emotions of this cause me to act prematurely. I'm just going to let it roll out.

Let the properties be sold. When they call, go, hey guys, we got this short conversation. We've already teed up the bankruptcy attorney. This kid's got nothing. She got screwed over by her dad.

And you're getting nothing. Or I'll give you 20 grand to keep her from having a file bankruptcy. Which one you want to do? >> Man, I want to know what the dad's saying right now. Tough.

Woof. So sorry Robert. That's, that's. >> Thanksgiving. It's going to be weird.

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So I can't even one of us walking with you every day. Showing you the next ride step. Start every dollar for free by downloading it in the App Store or Google Play. Rachel, that ad copy reminds me.

I was doing an interview with a major international network this morning. And the guy said, "Do you think that some of your listeners think you're mean?" And I said, "Absolutely." All you have to say is the comments.

And you know that. And he goes, "You can be grumpy sometimes." That's different than me. But yeah. But I said, "Well, he said, "Well, why would people keep listening

and keep calling you if they think you're mean?" And I said, "Well, to start with, there are shows that are much meaner than we are, much more over the top

and they basically use their callers to create drama."

And they get great ratings. Sure. Those kinds of, that process works. Which is not our process. Our process is to help people.

And it's telling you the truth. But when I listen to your show, I feel like I've got to do list of things that aren't done and I don't get any credit for the things that are done. And I said, "Yeah."

[laughs] I mean, what did you say? When I go home, Sharon Ramsey's got one of those. [laughs] I got to do list of things to do and I don't get any credit

for the ones that are done. I don't celebrate our listeners more. I mean, that's what it is. But we are taking you from where you are to where you want to go. Yeah.

And we love you and we're going to tell you the truth to get you from where you are to where you want to go. Just like this every dollar ad just said, right? Yes. But also, where you've been is just part of the story.

Yes. But if you've completed maybe step one. Incredible, you guys. If you've done that. Well, I'm not doing it.

Yeah, that's, you know, we tell people often way to go. Right. Yeah. Yeah. Yeah.

We're, it feels like it's like a never ending process.

I just finished the laundry and they'll be another one. I got, I got to keep you. You know, tomorrow. I'm sorry. Welcome to grown-up like you know.

Jonathan is with us. Jonathan is in Sarasota, Florida. Hi Jonathan, how are you? Doing okay. They've, how are you?

Better than I deserve. What's up?

“So my question is, should I use my gambling winnings to help pay off my house?”

Or do I let it ride? Because I'm doing pretty well with it. You're about to get grumpy Dave John. Yeah. Are you, are you Jordan's just like a joke?

How many did you call up? Hold on. I want to hear. Hold on. I'm going to hear.

But what is, what is this? What, what did you gamble? What do you have? Give us, I'm, I'm just curious. Give me the details.

No, that's going to change my answer. I'm our focus. I am a long time listener and I'm being a little bit silly here. How good. Oh, I hope so.

Good. I feel better already about you. I do want to hear the numbers. My, my crypto and my single stocks. I call that my beer.

Oh, that's for gambling. That's for gambling. I know that's. Yeah. I don't.

There I don't. Gamble. You are on time. I know. I know I can.

Okay.

“I know how much beer and gambling money do you have, Jonathan?”

So about about 25. Okay. Built from essentially pennies. I think I am overfunded in my emergency fund. Or maybe some might my question is.

Do I convert this crypto and single stocks to my emergency fund? And then essentially drain the hundred K that I have in my high yield savings. Because I owe a hundred K on my house. Would that leave you with no emergency fund? No.

It would leave me with about 25 K from the crypto and single stocks if I got a rid of them. Oh, I say, okay. So that would mean, okay. Well, if your house was paid off, would you borrow on it to put money in your high yield savings and into crypto? Of course.

Yes, of course not. Same thing, isn't it? Right. Yeah. If I pay the house off, you know, we could live on about two K a month.

So I think the 25 K would be sufficient.

Did you get my analysis there?

Did you understand what I was saying? That's why you laughed. He said, of course not. So one million percent. Yeah.

Yeah. Yeah. So you're kind of already knew I was going to say that because you listen. So there is a couple of what I think are big asterisk here. One is bigger than the other.

One is, I mean, a 1970s home for my counterpart tops and 70s things everywhere. They're cosmetic. So I can deal with it. However, the other wrinkle in this, and this is why I'm hesitant to pay the house off, and we have, we have some upcoming medical stuff that we know is there's a 95% chance.

It's going to happen.

You know, my wife, unfortunately, without getting too personal, has a disease that requires surgery,

every one to three years. We've been together for 20 years. So we've been through 10 of them together. And then you have health insurance.

“So you have to park your out of pocket for the surgery is going to be how much.”

Because the insurance is going to cover most of it. So that's the tough part. We've gone through local doctors before and let's just say last time the surgery did not go well. And there's a specialty center that's kind of far from us that that does not take insurance. But they are that we've done our research.

They're the best of the best. It's where she should be. And how much is that? They're charging us 1200 bucks to have a conversation. So I don't yet know because there's.

Okay, a lot of it's a half a million dollars.

That's a, that's a great question. You're not having any conversations to you. Give me a price range. No paid to conversations. Sir, fair enough.

So I'll pay the 200 bucks and and the, and let's call the procedure. $20,000 and you want to do it outside of insurance because of quality issues. Okay, that's fine.

“What do you, what's your household income?”

Just just over 200. Okay. When will the surgery happen? Not take home. That's okay. That's, that's gross.

When, when will the surgery take place? Rachel said. It's not scheduled yet because the initial consult is this week. Okay. Assuming within the next six months, let's say.

Okay. Here's what I would do. I would. Because your house is not paid off. And because having cash in the season is probably going to be really a priority for you guys.

Because of the health stuff, I would get out of crypto, single stock. I would. I would condense down. I would have my high yield savings. Anything over.

“And you'll know after the consult kind of the range of what this is going to cost you guys.”

But let's say it's let's say it's 70,000. I don't know. You know what I mean? I may just take a beat and get through the health stuff. I mean, John, that's it.

I mean, to me, that's. I would want all of that taken care of and have that piece knowing like, hey, we have the money to make the moves we need to make with our health. And to me, like, that's that's priceless. Agreed.

But with the caveat that once all of this is settled up and if she doesn't need the surgery for another three years after this one, we're paying the house off. And then yeah, and then we're going to save again. So when this, when it comes back up in three years, we're good. Like, the cushion for me is knowing health wise we're fine.

And but we still have a target date, we're still not going to take our out of the ball because we want to, we're going to stay motivated knowing what we're going to do after this. But that's what I would do. Completely agree. So recap.

Cash out the cont crypto in the stock today. Put it in your high yield savings. Go do the consult. Set aside the emergency front plus the budget for the surgery. The rest of it at the mortgage.

And by Christmas the surgeries in your rear view mirror. And you know how much you got left to throw at the mortgage even more. And you can do this very, very quickly. Both things will occur. The emotions of the surgery and taking care of your wife are raising this up

and making it like it's a blocker to this. It's really not. It's just a step. It's just one more step in the process as all from the math part. [ Music ]

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Go to CHMministries.org/budget and use promo code Ramsey. At CHMministries.org/budget and promo code Ramsey. [Music] Ramsey show a question of the day is brought to you by Why ReFi. If your private student loan payments are out of control, you may feel like you're out of options.

Why ReFi was built for borrowers in different situations in difficult situations. And it helps to explore refinancing options to fit your budget. Visit whyreFi.com/RAMsey might not be in all states. Today's question comes from Paul in London. Hope you're doing better than you deserve.

I'm a longtime listener from across the pond. I'm on baby step two and have $25,000 in card debt at a 7.5% interest rate. Now that my credit cards are paid off, I have the option to withdraw cash from them at 0% for 18 months with a 3.5% cash fee. Would you recommend doing this to save on the interest if I'm confident I can pay it off within the timeframe?

Now he's not talking about using the credit card at the pay off the car.

He's just talking about using cash from the credit card was 0% interest. Right? Yeah, so zero versus seven and a half on 25,000. Yes, but to pay off the car with it. Yeah.

Yeah. I mean, no, Paul. I mean, the reason you're in debt and the reason and how you're going to get out, it's you. It's not moving from debt to debt.

Still continuing to kind of play the game even at 0% interest. It doesn't isn't the issue at this point. In 25,000, I mean, hopefully you can pay that off to being on what you're making in 12 months, right? 2000 bucks a month and that gets you out of debt in the 7.5% interest rate at that point really really doesn't matter. Less than, I mean, it's about it.

It's about $13,000. You might save a thousand or 1,500. Or 1,500. Maybe 1,500. Yeah.

Yeah. Because you're not going to have the 25,000 borrowed for an entire year. You'll have about 10,000 borrowed average over the course of the 12 months if you're paying it off in 12 months.

“You said you can do it for 18 if you want to, but I didn't think you were going to do that.”

Let's call it a year. So the discussion is, do I save a thousand dollars by doing this hack and borrowing money on my credit card? And I'm with Rachel. No, you don't. Because you don't have a $1,000 problem.

You have a 25,000 problem. And you don't solve a 25,000 problem with $1,000. So the thing is, you feel like when you do this that you did something. And the Bible says out of the abundance of the heart, the mouth speaks. In other words, it's really inside you end up saying it without meaning to.

And you'll say something like, I paid off my car. No, you didn't. You moved your car dead on the credit cards. You did not pay it off, but you'll say that. Yeah.

And you didn't. And it feels like it in a sense. And that'll slow you down. That'll slow you down.

“So you need to just be pissed off at $25,000 worth.”

And how fast can I knock that out? It's called $2,100 a month for 12 months. And you are done my friend. And that's what we're aiming at here. So let's just do that.

And it's going to cost you $1,000 more than your idea. But you can't hack your way out of debt. You pay your way out of debt. Yep. And that's the same.

I mean, people we see this all the time with either debt consolidation companies. People taking out he locks to pay this. I mean, just the moving the debt around makes you feel like you did something. And you didn't. That's right.

So that goes for all those options.

You earn.

And you, and the debt goes away.

And by the way.

“It's surely copies stupid credit cards today.”

Don't keep them around. And that gets all this stuff out of your head then. They're no longer an option. We don't have credit cards in our house. That's the what you need to see.

And it said now that my credit cards are paid off. Meaning at some point you would have credit card debt. And now we're going to get rid of them. By the way, the way you got credit card debt was you believe the lie that you could go use it as zero percentage for 90 days. And pay it off.

Yeah. And then you didn't or 30 days. And then you didn't. And so let's just stay away from these snakes. They bite.

They're real snakes. They have venom and stuff. All right. Marks in West Virginia. Hey, Mark.

What's up? Well, I have to. Everything's going good. Just made a lot of bad choices. I know.

I know. God. Just like that. He does a radio show now. Yeah.

Well, I had emailed you. And I had no clue what I would get a call on this figure. I'd get emailed. So I got a question. Maybe too late.

Almost 64 years old. I have zero retirement. And I'm looking at Social Security in a few years. It'll be about 15 hours a month. What do you make?

What's your income? With my income and my wife's without the four taxes. Yeah. About 54,000. Okay.

You're both working 40 hours. No. She's also security. She don't work. And I'm a pastor.

And I'm... I'm... I reckon it'd be a consider by vocational. I still come to our work. I'm a machinist.

But trade. I mean, the high string 41 years. Yeah. So...

I've never had a retirement.

Everyone worked. There was never no retirement. All sorts of... Yeah. I've just lived from hand to mouth.

Actually. Yeah, yeah. Okay. So... And do you have debt?

My question? You have debt? Yes. I have 118,000 less than the mortgage. Because I had to refinance.

Because of medical issues. I didn't have the insurance at the time. So... I was in a way to pay that debt. It was to refinance and just have it in a different place.

Well, my magic wand is low on batteries. And so I don't... I don't have an easy way to fix this.

“The only way I know how to fix it is that you guys have to do things you've never done before in your life.”

And that's work. A lot more than you've been working. That should not hard work or you are hard worker. But I want you to take all the overtime. I want her to get a job.

I want everybody working. And let's just stack as much cash as we can stack. Because we need some money. No. Well, she's basically not able.

And I've worked in best-can still past her. But I've had a stroke and a couple heart attacks. And I've got cancer. So it limits me and what I can do. That's fair.

Yeah. You don't want to make sense. I want to get about 40 hours out of the day. Yeah, I bet you are. Actually.

And pushing to do that with all the stuff you've faced. I'm sorry. Well, I do not know how to fix your situation except add money to the equation. Is there anything available? I mean, I know it's too late.

I understand too late for anything major. But is there anything I can out there?

I've never entered my mind about investing until you're just recently.

I've done some checking, of course. Is there anything I can do? That makes money. Is there a money? Well, by money, I've talked to me.

And it's worked only for one case. And there are all time pushing money here and there. And watching. Well, if you put some money into a good mutual fund, it will grow.

And that's what I would suggest. And you can learn about that by getting one of our smart master pros on the line. And just go to RamseySolutions.com and click on smart master pro. And they've got the heart of a teacher. And they'll talk to you and tell you how to do it.

“But the only way this machine spits out money is you have to put money into it.”

And so you're going to be living on less than you make. Which means you're going to cut expenses further than you've ever cut them. And anything you or she can do to get any income coming in to throw into this machine. It's called a mutual fund and in your Roth IRA.

Because I mean, if you start putting 500 bucks a month away, that's a lot.

But that's going to be a whole lot more than you got today. Yeah. And this is not going to end well. Fifteen hundred dollars a month is not going to work. No, because they're probably living off around four,

despite what they're bringing home after taxes and everything. And so I'm just wondering mark where you guys can. Look at that. Say, hey, what if we radically, yeah, put 800 away, even for a short term. Yeah, that's $10,000 a year.

“Emergency fund though, even just starting out, right?”

And so small steps. I think for you guys, Mark is going to feel like a lot. A little bit more money coming in than what you're used to. Tightening up the budget and putting some away in savings. And then yes, eventually an investing will be a great spot.

But it's going to. It's going to be a lot considering everything that you guys have going on. Hey, guys, George Campbell here, there are a lot of things you probably shouldn't ignore.

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Thank you for joining us America. We're glad you're here. Sheridan is in Winston's Salem North Carolina. I'm Sheridan. How are you? Hey, Dave and Rachel.

Thank you so much for taking your call. I'm doing well. How you guys doing? Better than I deserve. How can I help? Hey, I was just wondering,

should I be saving up for a new family vehicle? I still have my house mortgage? Uh, yeah. You can upgrade a vehicle. What's the current one that you have?

Uh, well, I have three vehicles actually. I have a pickup and I have a little bigger car than I drive the work. And I've also got my wife's mouth move. Uh, that we drive for good.

And we're going to upgrade that. And I want to upgrade the mouth. Yeah. Yeah. How much would it go for eventually?

I mean, it doesn't have to be right now. Uh, it's probably worth about 4500 of a day. Okay. How much do you guys make a year? Uh, take home after taxes around the 100. Okay.

You're fine, yeah. Yeah.

What we teach here then is the first three baby steps.

$1,000 saved and paying off all your debt except your house. And then having an emergency fund. You do with intensity. And you don't do anything during those. You don't go on vacation.

You don't buy anything. You got all that in your rear view mirror. And when you move to baby steps four, five and six, then you move from intensity to intentional. Yeah.

Yeah. Well, I have a buddy that thinks I'm stupid for saving up for a vehicle. Why do I have my house loan? And I was like, well, I'm going to call you guys and see. I have, I have about 15,000 in a high yield savings.

And I've got another almost 6,000 in other savings account. Is that your emergency funds? I don't have any other. Yeah. Yeah.

Okay. So yep. I would leave that alone. And then if you want to. Okay.

I'll just save a couple of thousand and upgrade to a $10,000. Well, I have, you know, I have saw me in my account already. I have about 10,000 in my vehicle fund now. Oh, that's an addition to the 15,000. Yeah.

Go buy a car. Go get a car. Go buy a car. Yeah. Okay.

Well, I've got. Yeah. Take off. Absolutely. Well, you got a good friend who's like, semi.

“Great about saying you should be looking for a car.”

Usually. Most friends are the opposite. Yeah. Yeah. And they can get you a car payment.

That's it.

Most people. I know. Yeah.

“This guy's got, you can't ever buy a car again.”

Tell you get your money. No. That's not what we teach here. And we teach when you get to this stage. Maybe steps 4, 5, and 6 that you can do some things like upgrade the car.

Go on vacation. Go out to eat again. And any extra money you get beyond your that stuff. And the 15. About 15% going into retirement goes on your mortgage.

And that's maybe steps 4, 5, and 6 run simultaneous. So you're doing it right. You're doing it perfect. West is in Atlanta. High, West.

How are you? Yeah. You're doing better than I deserve. What's up? About two years ago, I was able to leave my company that I worked for and start running my own business.

Cool. I've got a long landscape business. I've got big enough where I can do it myself. Cool. I've got about 10 employees.

And I've finally got mad about the idea. And started paying it off. I paid off about $80,000 in the last last year. Good for you. That's all right.

So the big question I have is I like to always plan in advance.

I've got a 401K account that I had with the previous company. I've got about $80,000 in there. My question is should this kind of been Latin at 6. But I want to start out. Now that I started getting everything paid off.

I want to start adding money to it. Should I leave it? Or is that? Or should I move it over to IRA or some other account to you? That would be better off for me.

Yeah. Roll it over to a traditional IRA. And yeah.

“So you can get with this Mark Mr. Pro and do that if you need to.”

Go to ramsysolutions.com and check one of them out in your area. But yeah, you never want to leave an account with an old employer. So go ahead and just roll it over. And then yeah, I mean, you're to the point with after paying off the debt. To start investing.

Yeah, you're you're not actually going to add to that account. But you can sit down with this Mark Mr. Pro and set up your. Retirement planning through your new company or just direct as an individual, which everyone you decide to do. And but you are Rachel's right. You always roll it over.

And we always tell you to spread your mutual funds across four types.

When you do the roll over growth growth and income. Aggressive growth and international all with good long track records. Very calm, very, very sedate kind of boring. And but then you've got control of it. It's not sitting back with some HR firm and other or some HR department.

And you hadn't looked at it in five years. You don't want to do that. You want to get it with a smart investor. But as an employer with 10 employees, I mean, he can set up. He can set up a simple.

Set up a simple or a set up. Probably a simple would be better a simple IRA, which is a very expensive. For our inexpensive 401K for a small time employer, the only. It has almost no administrative fees to run it. A big time 401K when you got a bunch of team members is expensive to run.

From the employer's perspective, but this is very inexpensive. It's called a simple IRA. So ask them about that for your new account and roll over the old 401K. Just in two, as Rachel said, a traditional IRA.

“Lindsey's in Boise, Idaho, high Lindsey, how are you?”

Hello, I'm good. Thank you for taking my call. Sure. What's up? Um, sound myself in a pretty precarious situation.

This last year with some significant home affairs and medical bills. Um, that has piled up. I'm sorry, something may have been an error separated. So maintaining two households. Um, found out yesterday the well had failed in the home that I'm living in.

And requires a new well to be drilled. So I'm looking at approximately a $23,000 debt coming out to me. And I am just wondering if she won't. Is the best option. I'm sorry.

I'm sorry. We throw wells in Tennessee and nobody ever said $23,000. That's serious. That's nuts. The last one I drilled was $35,000.

Okay. And it was like a year and a half ago. I got a quote from a second company to brief information over the phone. And he had said. $16,5.

That was $23 also includes the $4,000 of repair that they attempted yesterday that did not happen. And that was not. What's the revenue of that? No, no. So our aquifer has so the sand.

And so they tried to flush it out. And it was unsuccessful. And so they charged us $4,000 for that. Well, I'll be honest.

I've never drilled a well in Idaho.

So I don't know what I'm talking about. I've only done it in Tennessee. But that just sounds way out of where I'm going to keep learning about this.

I take it. Yes. No city water available. No, not available.

So I guess we were looking at, you know, more likely for all of the components.

Uh, 18 or 19,000 that 23 includes the $4,000 was a temporary repair. Yeah, the repair was a temporary. How much do you make Lindsay? Um, I'm currently unemployed but working on employment. Um, may have been does make $250.

“And why does he not have 23,000 put into his house?”

Oh, he has working with me on it. Yes. Why doesn't he write a check and pay for it? Because there's no cash available for that right now. Well, there's $250,000 coming in, so where's it going?

Between two households and four children. No, that's not extra. That's still $23,000 left over. Nope. What for a monthly?

Like, what that. No, I mean, his monthly income is $20,000 a month. Oh, no, no, no. I'm sorry. That's pre-tax.

I know. I know. I know.

“But his monthly income is actually $24,000 a month.”

Pre-tax. And so, and he has absolutely no money saved. Not after the emergency fund that we put towards the home repair last year. Okay. So you're telling me your husband would make $250,000 a year to then have a dime?

And you're separated and you're unemployed. There's a lot going on here, kiddo. I'm digging into this further since we're digging a wall. I'm going to get multiple, multiple clothes. I'm going to get multiple quotes and I'm going to lean in with him a little bit more and go.

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Welcome back to the Ram Z Show. In the Fair Wins Credit Union Studio, I'm Dave Ramsey, Rachel Cruz. Ramsey personality, my daughter is my co-host today. Brad is with us and see you at a high Brad, how are you? Hey Dave, thanks for taking my call.

Sure, what's up? So I have a pretty unique situation that I haven't been able to get great advice on. Over the last year I've been in a really unique situation where my wife and I have been busted or butts.

We've been working five jobs and I'll have about a million dollars and income just for this year.

And that includes revenue from a for profit, a flower farm and agricultural business. My problem is that I hate giving the government my money. My question is, I've met with about eight, five or one, see three lawyers. They're telling you that I can start a non-for-profit that I kind of do on the side anyway. I can just use for profit revenue.

I can use my to bring value to you. Can you just you can use what say again? The lawyers are saying that I can start a non-for-profit and use my donor-advised funds that I will contribute this year to bring value in some way shape or form to my community. And self-dealing is a concern. So I want to make sure that I'm approaching this decision from a position of integrity.

Can I thought I'd ask your advice? So the nonprofit, okay, so you put money in a donor-advised fund and you add it to your 501c3, which by the way, you could just put it in the 501c3.

Whatever you put in there has to be used for that charity, that purpose.

“What is the purpose? What are you doing?”

So we have a flower farm, and it's a for-profit business.

We have basically an agro-tourism business, but we've already been volunteering in the local community teaching kids out of what we do.

I'm just using my time and our revenue. You should do what you do. You cannot pay yourself out of your own nonprofit to teach kids to do what you do. That will not pass on audit. Yeah, I will put in an independent order of directors.

Doesn't matter. And don't do that anyway, I wouldn't. Okay. I have a family foundation and me and Sharon are the board of directors now. But everything we give to is independent from us.

We're not buying financial peace university and giving the kids to somebody and giving us, giving ourselves the money out of that. We don't do that. That's not a integrity problem. That won't pass a tax law. So that's my question. Let me challenge you five flowers with your 501c3 to give to the poor from yourself. You're going to get hammered in an audit.

“So the challenges, that's what lawyers are telling me that I can do.”

There's a use case where I can have my for-profit by a tractor and I can have my non-for-profit. It's not that at least the use of the tractor if it is at fair market value. You're going to get hammered in an audit. I don't care. I don't care what your lawyers are saying. The IRS audits me like it's a hobby.

Okay. Like they have their own office here. They're here all the time. And our family foundation is included. And so we had another nonprofit at one point that we shut down just because of this exact crap. It does not do what you want it to do.

You're trying to, you've made money for the first time in your life.

You've become successful and you've figured out that in America that people want you to be successful until you are. And then that you are evil and you must be punished and taxed into oblivion. And because socialism is good and all that bull crap. And so you're discovering that you're being punished for winning. And you're trying to keep from giving the government all your stupid money.

And I don't blame you. I get mad every April. But but I'm not going to do something where it invites the IRS to do an anal exam on me every April either. And they do. They just they come around here and live with us. And it's just they're horrible.

They're horrible. And you just don't, you don't want to do anything. You can't hide the pee from yourself. By doing all this show game stuff. You can't move the show game around.

You can't move the pee around enough to do it. It doesn't work. So don't do it. Don't don't try to hide. Don't lease the tractor back from yourself.

Just go make money and give some money away. And give it to an on profit. What do you think is independent from you? Yes. What do you think about deaths?

The donor advice funds for. I don't don't don't advice funds for. It's an inexpensive way to not. Our foundation has a lot more expenses. To run it.

Then it does to run it on our advice fund. Don't advice fund. The big thing you gain with the donor advice fund is you don't know by the calendar. Okay.

I can dump in half million dollars in December and spend the next three years giving it away.

But I get the right off in December. Yep. It has to go to a non-profit on the other side. Yeah, yeah, for sure. But individuals who are maybe on baby steps four, five, six,

maybe seven that are building wealth. Don't advice funds great. It's great. Yeah. The last level of sophistication and expense is a family foundation,

which we did about 10, 12 years ago now. Yeah. Because I know people that don't advice funds are great. Though, but yes, that there's ways that you can do it a little bit more of a sophisticated manner. Brad, I think your lawyers are living in the land of theory.

And in theory, in theory, there probably is a test case that survived and went all the way to the Supreme Court. But I'm talking about in practical fact when you start trying to move the tractor around and at least the tractor back from yourself from the nonprofit and by the gasoline for the diesel for the tractor. And then you can't figure out whether the guy picking the flowers with who he worked for that day. And when you get down into all of this, you're going to wish you just paid taxes.

“And by the time they come in there and you have to try to explain it to somebody who's not that smart,”

because they work for the IRS. So that's a pretty qualifier. And so you have to sit down with them and try to explain how this works. And oh, there's a test case and lawyers and they go only know what you mean. And all I know is that you can't do this.

And so the practicality of what you're suggesting doesn't work.

That's what I'm saying. And the hassle you'll probably have to deal with. It's going to be a pain in the butt. It's going to be a pain in the butt. Is there was a nonprofit I forgot about that here, right, that we gave.

We had a nonprofit that we gave people donated to it. And we gave financial peace and diversity away to low income. So there are donations. Yes, to homeless shelter, right? By the time they came in and audited and they said,

“you have to have a board of directors and I'm like,”

oh, you don't. The law says you don't. Well, you have to. And I'm like, okay, just shut it down. Well, I can't really tell you you have to.

And I'm like, well, you just did. And you're wrong. I know, but we think you should. And I don't care what you think. Get out of my office.

I mean, this is the kind of conversations we've actually had with these human beings. And so I know what embarrasses you, but it's the truth. No, it's embarrassing.

It's probably why they ought to always honor you.

“Yeah, well, cause I think they're idiots.”

But yeah, that'll do it. I think they're and they represent an idiot government. So there we go. Just keeps on going from there. Anyway, don't.

I wouldn't do it, Brad. I think you might survive the theoretical thing. But you might spend more in legal fees and in CPAs fighting your audit. And tax lawyers fighting your audit. Then you ever saved in taxes.

All with good intent. And that I'm sorry.

The bad news is when you make money, you get to pay a lot of taxes.

The rich don't pay any taxes. Said no one who's ever been rich. Rich pay more taxes than all the people that said that put together. That's just bull. One of the biggest mistakes home buyers make is talking to a realtor and shopping for houses before understanding their real budget.

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Contact Churchill. Know your numbers and then when you find the perfect house, you're ready. Go to Churchill Mortgage.com/Ramsieoffer for a special offer only for Ramsey fans. That's Churchill Mortgage.com/Ramsieoffer or click the link in the description. David is with us in Chicago.

Hi, David. How are you? Good. How are you? So I've really appreciate you taking my phone call. My pleasure. What's up? To keep this as brief as possible, although there are a lot of moving parts. My wife went to Nepal and she her father took out and she has two other siblings.

And older sister, younger brother, her father took out a parent plus loan for all three of them. And after everything happened with COVID and stuff in the reinstituted loan payments, the father had it set up where these payments were auto-debted from here's account. And then he expected his three children to individually, somehow there's a system with points to figure out the amount, vell him, the other vell app,

that payment to replenish his bank account. My wife and I were complying to that and doing that because there's Christians, you know, we want to do the right thing. But then there was an incident on Mother's Day over a year and a half ago where there was a disagreement. They do not like that my wife converted to Christianity and was baptized.

And they also do not like me. I'm a disabled police officer. And they do not support my career. What I'm doing and because of some mischiefs, which have been apologized multiple attempts of forgiveness, the father and mother and sister and brother have completely disowned me and my wife.

And with that said, the father is still wants the money.

I am conflated with morality on what there is no written agreement. There was no contract where on fixed income. And we simply want to understand, you know, you don't want a relationship with your daughter, but you want her money. And with that said, does that with that no a file?

I mean, I understand legally the parent plus loan is in his name. And it's auto-debted from his account. It's also collected with the three students. It's not separate or individualized. Like my friend, for example, can log in on his own and pay from his own account,

even though it was under his mother's name. It's not set up like that. It's all collective.

“And so I'm generally asking should we continue to sell him this payment?”

So before your wife went to Nepal,

he said, I'm going to take a parent plus loan and your wife looked at him and said,

I will pay that. Or she went to Nepal and then he said, Oh, by the way, you're a bunch of money. It was not, there really was no concrete conversation. My wife and I discussed this.

It was more just, it was assumed it would be paid by the kids. They did mention verbally. Who assumed it? Did the kid assume it? The father. I know, but I mean, did your wife promise him that she would repay for her college at the point before the loans were taken out?

I believe there was a verbal agreement there, possibly. But with that said, he's completely disowned out. I understand that part. I'm asking you about her promise. I'm not asking about his behavior.

I do not, according to my wife, there was a very brief conversation when he said basically something.

She didn't have any idea how much he owes. Yeah, how much is owed, David, on her part? I believe it's upwards of $75,000. We've attempted to ask even to lower the loan payment. And he does not, he refuses to even sit down with accountability,

Martin or somebody in a public area to even discuss lower the loan payment and anything like that. I believe the loan payment was attempted to be lowered with him in my wife once. It was time to sister flipped out and made phone calls to have it re-adjusted. So she could pay off her sooner because it's all combined.

At which point, none of them are talking to us and refuse to even talk to us about this payment. How much is the payment at once? It's $516 and about 35 cents roughly. How much do you guys make here? I'm disabled police officer on a fixed income of about $8,000 a year.

And my wife makes roughly about $72,000, $78,000 a year also. Okay. We would take care of the paycheck right now and we're going to return to saves. Other than it's unbelievably sad. And ridiculous that he's disowned his daughter and still wants money.

“The issue, if I'm in your shoes and that's what you're asking,”

is this a moral obligation that your wife made. Regardless of the behavior of her father, you can't control his behavior. You can only control your behavior. And if she on a handshake said, I'm going to depall dad borrow the money and I will pay you back.

If that is the deal, that is the deal. Okay. And if it's not the deal, it's not the deal. And I can't tell from our conversation because it's still wishy-washy. If that's the deal, you said it was kind of implied, parent thought it.

And maybe there was a conversation with a 17 year old, but she has no very clear memory of it. I mean, if I sat and looked her in the eyes, I don't think based on what you've said, she's going to slap her hand on the table and say,

"Absolutely, I promised him I would pay it." I don't think she believes that. She was under the pressure. She was under the impression that the time of the loan that the loan was taken out separately in her name

and it was not combined where she's paid. That doesn't matter. That's not the issue. The issue is that she promised him she would pay his loan that he went and borrowed. That's only thing is bothering me.

If you get one side of the other of that, it's your answer. And so I wish that you would tell me that she didn't make that promise. And the old man just told everybody,

"That's the way it is, because I'm in charge." And you're going to pay this back. In which case, I'd tell him to stick it.

“That's actually, "No, that's what happened."”

He said, "They asked if they said where they wanted to go to school." And he replied and he said, "Okay, I'm going to take out these loans for you guys in the favor." And then they said, "Okay."

And he goes, "You're going to have to pay this stuff back."

And I think at the time, this happened several years ago.

If she agreed to that demand, before she went to school and took his money, then she promised to repay it. As uncomfortable and ridiculous as this is, she made a promise to pay him.

And she shouldn't have to. It's wrong. I wish she hadn't. I don't want her to. I don't like this guy.

Your call made me not like him. I've got a lot of suspicions about all the stuff going on. It's really nasty, but yeah. So, you know, you could do this. You could say, "All right,

when you give us a full accounting of exactly what my share is and a payment schedule that shows us when that is going to be paid off, we will resume payments until you do. You'll get nothing." I mean, I would do that with a bank.

Yes. Well, and, because there's a weirdness, if you're two years in, and you guys are throwing,

“you're like, "I think we've hit the seven feet.”

We don't know." And for the sister, he said the sister got mad, because she wanted to pay her as a student, which I get, because the interest is accruing, and if he makes some spread out.

The sister shouldn't have a say in your part. Not in her, but not in their part, but she probably says, "On my part, I don't want that payment schedule. I want to pay more, so I can get it paid off."

Because I don't want to pay the interest on it for long. He's lumped it all into one and can't tell. So, which is the problem? So, here's the deal. When you give me an exact amount,

and an interest rate, and I will pay on that schedule, we'll resume payments until you do. We're not going to pay anymore. He has nothing in writing.

Yes. He has nothing in writing. There's nothing he can do.

“He's going to have to just sit on that egg”

until it hatches. And so, I would stop all of this craziness. This guy's a power player. And he throws himself around all the time. And the way to handle that is just very calm.

I just say, "You know, we've talked about it, and we're not going to be sending you any more payments until we have an actual accounting of what is owed that is her part only." And then we will pay payments on her part only.

And that's like not a crazy request. No, that's a bank. If a bank was jerking me around, I'd want that account. Yes.

Before I gave many more money. I just put them on the sidelines. I do the exact same thing. And I love David. I'm sorry.

I'm sure he feels in the middle of it too. It's horrible. Well, and it's just horrible.

And, uh, word of warning to the 30 million of you listening.

That's what a parent plus loan is. Can you say sucks? Don't do student loans. Really don't do parent plus loans. And really don't obligate your 17 year old.

For $70,000 to go to Nepal to get a degree that makes $70,000. Bad parent. Bad parent. If you're behind on your bills, doing more of the same isn't going to fix it.

You need a different plan.

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Go to guardianlit.com/Ramsik right now. That's guardianlit.com/Ramsik. Attorney advertising results may vary. And no specific outcome is guaranteed. We teach you to live like no one else.

Sacrifice, hustle, grind, sell stuff to get out of debt. So that later you can live and give like no one else. Set yourself free. Get rid of the debt. Get your emergency fund done.

That's baby steps 1, 2, 3. Baby step 4 and beyond. You move from intense to intentional.

And that's where you get the second half of that.

So that later you can live and give like no one else. So you need to live again. Once you've gotten to baby step 4.

“We want you to live again with the live like no one else.”

Cruise. Go with us on a cruise baby. That's it. That was my best. That was my best home.

That was pretty lame. All right. That's pretty lame. That's pretty lame. Hey, the live like no one else.

Cruise.

The second time we've done it is this coming March.

March will be your 20 minute show. It's right here. Let's go. Let's go baby. March 14 through 21.

Seven nights. Holland America, nice ship. This is not Walmart on the season. This is the good stuff. And this is incredible.

We had an absolute blast. This time we're going to Jamaica. The Grand Cayman. Grand Cayman. Causamel.

Even the Bahamas. We're going to all this stuff. And we're going to come. The whole ship is people that are gotten to baby step 4 and beyond. And are sell up.

Braiding. The fact that they got out of debt and they're winning with money. And they're living like no one else. I'll be on there with my wife Sharon Rachel, John Deloni, George Camel. Jade Washa, Natalie Grant is coming as our musical guest.

She's incredible. And many others. It's going to be a whole thing. We're going to do pop up Q and A's. We're going to do events.

George and I decided this week.

“We're probably going to do some of that investing essential stuff.”

Where we go into the wealth planning, estate planning stuff, the nerdy stuff. Because it was real popular. We think some of y'all might want to have that on the cruise anyway. And then you can have a cocktail with George and I for smart money happy hour life. You know.

Oh my gosh. There it is. There's the picture when y'all did. We're going to record a smart money happy hour live event there. We're going to be.

We have fun. We have a blast. The people had a blast. Everyone on the ship was positive. Let me tell you how you know it's cool.

The staff on the ship.

All the workers on the ship said we have never had a ship full of people.

That were this kind and this generous to us and easy to work with. That's who comes on the ship. I know they said they're the nicest people. The nicest people. And they were.

They were trading having a regular sample on the following week. Oh no. Yeah. It's so great. It is so fun.

You guys. Maybe step four and beyond. Go to Ramsey Solutions dot com slash events or click the link in the show notes. Get your cab and you can reserve it for 600 bucks. There's a few left.

We would love to have you come with us. It's going to be 2,000 people just like you and people celebrate. We have people that we just got married. We have people that've been married 50 years. But it's live like no one else cruise.

March. Get your large world's largest debt free screen. There it is right there. Man. It's going to be a blast.

You don't want to miss this. And we actually enjoyed it. I kind of was worried about if I got trapped on the ship with 2,000 people, but it actually, I actually had a great time. It was a lot of fun.

I had took a lot of pictures with friend new friends and we did a lot of fun stuff. And we really, really enjoyed it. Cindy is in Reno, Nevada. Hi, Cindy. Welcome to the Ramsey Show.

Hey. Thanks so much for taking my call. I'm excited to talk to you. You too. What's up?

Thanks. So I'm calling about my brother. This is kind of a moral financial situation. But over a year ago, he was making $100,000. He lost that job and couldn't make one single rent payment after losing the job.

So I paid his rent and our parents supported him during the first year of unemployment.

And I should say he's 63 years old. And he has now at the point where he is unable to afford housing. So how do you help someone who has been so irresponsible financial, they're in tire life, I would say he has a shopping addiction. Do I get involved?

I'd like to sit him down and talk baby steps with him. But is that my business to do that?

“And is it too late to turn things around when you're in your 60s?”

It's never too late. People change all the time. And sometimes they have the best chapter of their life, late in life because they finally wake up. So we can certainly be prayerful for him and think good things for him.

I have a, when I first started making a tiny bit of money. And I saw someone in need in a situation like that. I would just give him money. And a guy told me one time he said, "You're lazy, Dave. You didn't care enough about them to really help them.

So you threw money at them for your conscience and you walked away." That's exactly what our parents have done for years. And that kind of convicted me that just throwing money at something might even be harmful. That's what I think. Rather than helpful.

And so I don't want to be in an abler. I want to be a helper. And so that would require me where I in your situation to sit down with him and say,

But with that money comes a requirement of your behavior.

No behavior, change, no money.

“And it's not because we're punishing anyone or controlling anyone.”

It's because we love you and the behaviors that you're using are hurting you. And we want to see you not be hurt." If he had like a drug problem or a gambling problem, it would be like there are avenues that I would be aware of to go for help. But what do you do when someone just shops?

This is a guy who has no money, but he has had an apartment. He doesn't anymore full of stuff plus three. Where is he living? All of stuff. Right now he's in a warehouse that a brother of our brothers of our zones.

It's in a poor part of town. The roof leaks, but it does have a little kitchen and a bathroom. One thing is living there free of charge. He's truly hip-hop. It's not, it's not zoned residential.

So I'm assuming that that could be like a county code file. Oh, I'm sure it is. That's okay. I'm going to worry about that. But the point is he should buy it.

He should buy it. I'm 63 years old and I live in a warehouse that my brother owns. That's the bottom. It's that. But then it's also the sad realization though of,

and I don't want to speak this over him. But there are some people, and they just don't, they just, they are fine with where they are. That even the bottom doesn't, we like, I want the bottom to change him. Right. For your sake, you want them to, to hit some level of reality.

And I pray he does. But then you also have to come to grips with.

There is a possible fact that he may never, right?

And so what do you do? I'm not giving him anything. Yeah. Because I'm not going to participate. When you give someone money that is engaged in misbehavior,

you're financing the behavior that's bringing harm to them. You are harming them. Well, and I feel like that's exactly what our parents are. Yeah, that's what you've done too. That's what you've done too.

That's probably. And he always, it's always a big joke that he's going to end up retired and living with me. Because I'm a big, fancy family. Let me help you. It's not a big joke.

It's not happening. So it's not funny. It's not funny at all. So what I would do in this situation,

you asked for kind of, I'm going to create a structure of some kind.

That has some accountability to behaviors that get him out up and out of this mess. So thing one is you get no money except I'm going to match what you make at your new job. And you need a job. And I don't care if it's cleaning dishes. I don't care what it is.

You need a job. And the more money you make, the more I'll match for a certain period of time. And then you're going to be on a written budget and you and I are going to go over the budget. And you're going to stick to the budget or you don't get money. This is also part of your job.

Because I'm not going to give you money for your shopping addiction. I'm not going to give you money for your alcohol problem. I'm not going to give you money for your cocaine problem. And I'm not going to give you money for your problem. Whatever it is, fill in the blank.

So we're going to be on a budget. We're going to stick to the budget. And we're going to work. And we're going to need to go to any needs to go to counseling. There's a lot of things.

I mean, there's a real bad. I mean, there's something in him. That's very, very, very broken. And then deny it. Whatever it is.

Yeah. And he never wrote. And I'm going to give you that. Yeah.

“Has he never wrote this stuff that he has collected?”

I don't even think it has very much words. But he is so, so attached to it. I don't know if I can get it. Yeah. It's almost like a hoarder type.

Yeah. Again. Which is it? Whatever the behavior you want to change. Tie it to the money supply.

No behavior change. No money supply. Yeah. And he, again, he also needs to work on who he is. Because if it's a symptom, all of this is a symptom of something going on in him.

And until he gets that in perfect, all of this is just going to continue to spend and spend an orbit. Got to get upstream. She's right. Let me tell you what I get asked all the time when should I get term life insurance?

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Charles is with us in Chicago. Hey, Charles, what's up? Hi, David Rachel.

Before I ask my question, I just wanted to thank you for helping completely change my life.

I've been listening to the show for a few years. When I finished medical training 24 months ago, my wife and I had about $535,000 and $550,000 and auto loans as well. And over the past 24 months, I paid off every single dollar of all of this. And I've also built up about $300,000 in investable assets.

We're all crazy. That's amazing. You are making some serious money. Way to go, Charles. What are you talking about?

What are you talking about? Yeah, and what do you do? I'm 32 years old. I'm an anesthesiologist.

I'm learning about 680,000 a year.

My life's an occupational therapist. She makes 100,000 a year. We have no student loans, no card debt, no consumer debt of any kind. My only debt is 240,000 remaining on my mortgage for my house. Okay, I got $1.2 per cent.

That's amazing. I'll do that in Charles. Yeah, good job. Everything like a resident. For the lab, man.

You don't do that. You avoided docitis. Man, I'm proud of you. That's amazing. Well done.

Very well done. Now, I'm going to do something that just doesn't feel comfortable because I've been listening to the show and delay gratification, but in the spring and March, I want to buy a new car. I want to buy a Corvette. And I want to pay for it in cash.

But it's about $105,000. I already have about 50,000 earmarked for this on top of a $40,000 emergency fund as well. And my only thing every month is 1,600 mortgage. I plan to pay that off for sooner. What's your home worth?

My home is worth about $470,000. I was paying a little extra on it. I bought it in 2020 right when I started training. And I've been paying a little extra towards it as well. But now I'm like at a point where I'm starting to feel more secure, more confident.

And I do want to reward myself.

“I think I could do it without derailing my long-term plans.”

But I'm having a hard time with the opportunity cost of what if I put that $105,000 in the market. What if I put that in a mutual cost? I'll do that the rest of your time. You got plenty of time. You're okay.

You can do both. Every time we buy anything that we enjoy, it has an opportunity cost to it. So when Sharon and I go on a trip, it's two weeks long. And we stay at really nice places and spend too much money. There's an opportunity cost on that.

I could have given that to a charity. I could have invested it, but you also need to live it. And you've done a wonderful job. You're killing it. You guys are, your income is ridiculously wonderful.

It's, it's, it's otherworldly. And so everything is in place.

“You're obviously going to have the other 50,000 to pay cash by spring, right?”

I'll have that in like two months. Yeah, I'm still going to wait till spring. I do have investments of any kind at this stage. Yeah, I have about $290,000 worth of investments, mostly Roth. And I max out my, my four, four, one.

I max out two separate Roth IRAs. And then my wife puts 20,000 a year.

“It sounds like your net worth is bumping up around a million dollars with the house equity”

on that, isn't it? It's about 600.

Yeah, and by spring, it'll probably be close to a million.

Probably within a year I've injected based on my, so one of our rules of thumb, and we just made it up, by the way, is don't buy a new car because they don't go down and value until you have a net worth of at least a million dollars. That usually doesn't come up when someone is making 800,000 though. Yeah, I mean, so you're in a different situation here.

And you're going to be very, very close to the million. So if I were you, I would buy that car. Okay. In the spring, four cash. And we're talking about a 27 Corvette, right?

Oh, yeah, it's a new engine. They came out with 535 horsepower. Yeah, it's pretty awesome. I know, there's one of my garage. I just, I just got delivery only though.

But okay, and the 27. Hey, let Charles have his moment. That's okay. We're having our moment together. We both love this car.

Oh, yeah.

“This is, this is, I really want you to have this car.”

It's a great car. And yeah, that's a cool. It's very neat. Yeah, I want you to get it. And you've, you've done everything right.

You've done everything right. Me and my mini van will just. Yeah. You're doing your battery car. Yeah, you're just way about it from your battery car.

But we have a real engine. Charles, that's awesome though. Well done. Have fun. Yeah, enjoy it.

It's a great vehicle. And it's. And even if it wasn't, even if it was a hundred thousand dollar Tesla, the day phase, a regardless. Yeah, that's right.

I still tell you to do it. But I get more joy in telling you to do this one. But yeah, but it's, it's still a great, you know, still, you are the math and the process of where you are.

It's freaking incredible.

You guys just did a, I mean, you went all in and did it, man. And just couldn't write it away. It's such a magnified because the numbers are so big of the debt, though. But it just shows if you're intense for two years, regardless, if it's 500,000 or 50,000 right of debt, you pay it off.

And then your life is open. And your income's there, right? And again, not, you know, it could be 80,000 versus 800,000. But the numbers are magnified in this specific situation. But it goes to show regardless of the numbers.

It's still the same thing. Like sacrifice for two years of your life. And then all of a sudden, it's like, okay, pay off 500,000. And then there is a, it's kind of like we're talking about the cruise earlier.

“It's a, it's an emotional thing to, I think it's harder.”

Psychologically and emotionally to turn off the hustling grind and turn on the enjoy. Then it is to actually do the hustle and grind. It's weird. I mean, because we all went away. And it's different, and it's different kind of way.

Yeah, it's a, it's hard to flip that switch to and do it. It all takes work. Yeah, because when you're, because those of you in the grind are feeling it and you're exhausted. You're ready, you're ready for a break. But then it's weird.

It's like, grass is always greener.

And then when you get to the break, it's like, Okay, now I'm almost fearful to spend it because I don't want to go back to. Well, no, it's your, your, your body and your system is running at one speed on one thing. And you're taking a hard right turn. Mm-hmm.

And it's just, it's like, it's crazy. And to be able to look at that car and go, is that okay? Now, you're talking, is it okay for a guy that's making the household income is $800,000 to buy a $100,000 car? Yes.

Let's pretend you made $80,000 and bought a $10,000 car. Exact same ratios. Mm-hmm. But most people just can't relate to an $800,000 income. Oh, yeah, I mean, really.

Mm-hmm. Wow. And so, but an $80,000, a couple of making 80 grand by an $10,000 car for cash. In the exact same situation, we told him to do it. Yep, absolutely.

For sure. For the ratios still work and you still get to flip the switch from intensity to intentional, from live like no one else to sew that. Mm-hmm. So that.

So that. I can live and put a 27-core of that in your garage, Charles. Wait, it got on, man. Yeah, and that's permission for all of you because there's a lot of new listeners. And some of you are building your baby step one, your $1,000.

Or some of you are in the hustle and the grind of getting out of debt. But once you get that emergency funded and then beyond that, that is. It's where you actually get to make choices with your money because you have margin again. And if you're investing still and being intentional with some of it, there is the freedom to be able to say yes.

That permission to spend is okay. [Music]

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“I'm Dave Ramsey, Stephen is in Columbus, Ohio, high Stephen, how are you?”

Hey, thanks for taking my call, appreciate it. Sure, what's up? Well, meanwhile, we just turned 27 this year and just now started retiring. And my job offered a 4.K, a Roth 4.K, so I enrolled in it. And we're taking 9.40 out of my check and I'm going to max it out every year.

And then I got a account set up with a fidelity, a Roth IRA there. So we'll max it out. But everything I've been seeing is saying I'm just too late. And I don't know if I should just put it in the bank. I'm sorry, it was hard late.

Too old? Is that what they're telling you, Stephen? Yeah, too. Yeah. Who told you you're too old?

Well, I think I see on the internet and looking up that it won't accumulate in time. Everything on the internet is true. Abraham Lincoln said that. You're right about that. That's just, you know, any time you got that, that's just hogwash man.

So, okay, so you're 47, let's just play with it a second.

“And you said you're putting in 900 at worth $1,000 a month or work, right?”

No, no. Now you paid by weekly. Okay, I'll put in $2,000 a month. Yes, I'm maxing out. Okay, are they matching, are they matching also?

They don't do a maximum. If they do a property year, they'll throw some in. Okay, but right now we're $2,000 a month. And then you're putting how much in your Roth IRA individually? A maximum.

So, 75 hundred a year. Yes. Okay. Each, though, your spouse has one, two, 14. So that's an extra $1,000.

Yeah, 1200. Okay, so that's going to be $3,200. Yeah, 30 million. Goodness gracious, you're doing well. And that's awesome.

And so let's see, at 67, you'd have 2.7 million.

Yeah, I think you're too late. I don't think you're going to make it. Oh, I don't think I will be now. Okay, so you can go to RamseySolutions.com and use our investment calculator. That's what I just used.

I've got, I've got all my little phone thing here. And it came up $2.7 million. Okay. And if, so if I'm half wrong, you're still okay. Right?

That's going to give me my wife struggled for so long. I just don't want to. Yeah. Can you, I just got a great promotion in my job. I just want to.

Yep. Well, that's nice. The thing I want you to learn to do is just to calculate these things out for yourself. And let the math tell you what the facts are, not the internet. That's right.

You're right. And so now let's make sure that you're invested in good growth stock mutual funds. You're not in bonds. You're not in money markets. You're not in cash.

Yeah.

And the four types we talk about look for them in your 401(a) and talk to your smart investor pro or whoever's helping you with your Roth IRAs. Make sure that they're in that they're not just in the bank. But don't let the hope Steelers that are out there. And there's people that they're whole time job is to steal people's hope.

And they run out these bogus theories of things. The way things are going to be, you don't do this. You don't do that. You're not going to have enough with after a inflation adjusted and all that.

And the bottom line is dude, you're going to be a multi-millionaire.

If you'd never get a raise in 20 years and just only keep putting in this amount. And dude, if you don't get a raise for 20 years, you're a loser. Really, you get a raise. You're going to get raises. So this is going to be even more than that.

I'm going to say you're going to have about $4 million if you stay with this. And you stay in good growth stock mutual funds. And you just get it's the consistency, Steven.

“Now, if you are 27, obviously, would that be better mathematically sure?”

Oh, yeah. Absolutely. But no, but it's never, never too late. Never let someone tell you that it's too late. And make you call you to do nothing.

Because if you do nothing, you're guaranteeing it's too late. That's the irony of the stupid advice that's out there. Well, it's just too late. So we're going to put it in the bank. And we're just going to eat dog food.

I mean, what in the world? Robin Newton. This is serious, you know? So yeah. And just make sure you're in good growth stock mutual funds as you go along.

That's the trick. Dan is with us in Raleigh, North Carolina. Hi, Dan. How are you? I'm very well.

Thank you, Jason. And thanks for having me on your crawl. Sure. I had a question. So my wife and I are working this together.

I just retired this year and I've turned 70 as well.

My question is we have 1.5 between into those 1.5 million in our IRA.

And we pull in 12,000 a month after taxes in our retirement. The question I have is, should I start pulling out from my IRA, rolling into our Roth IRA, the tax free one. And keep those distributions.

“So I stay in the 22% bracket or should I bump up to the 24% bracket and pull out a little over 200,000 each year?”

Okay. Yeah. You're going to run into RMDs. You know that. Required minimum distribution of 73.

Whatever is remaining in 73 in that traditional. You're going to have to begin drawing down on it even though you don't need to. Because you have enough monthly income to live on, right? Yes, sir. Is that why you're wanting to roll it over to the Roth men Lee Dan?

Yeah, I want to pull it out and put it into the Roth. Yeah. I don't know if it's wise or to pull it out up front earlier and start making more money on the tax free side. Yeah. Or just leave it in the IRA and just roll and start pulling out the minimum.

Well, the thing is the tax bracket thing becomes tricky. And you actually can sit down with somebody and try to map it out.

But I would get it done sooner rather than later because the problem is the 1.5 continues to grow.

In other words, while you pull out 200, it probably grew another 200. Great. And Lee balanced it between the four categories that you talking about. Yeah, but I mean, if it's growing at 12% or so, it's, you know, it's going to grow another 200 pretty quick here. So you're, you're never going to get ahead of it in licks of 200.

You're going to have to do more than that and that is going to push you up a bracket.

“So the thing is this, if you just kind of do some math this way, it helps me remember how to do it.”

It'll double if it's at 10% growth rate, it'll double about every 7 years. And so 1.5 and 7 years is going to be 3 and 7 more years is going to be 6. And every, one of those dollars you haven't moved to Roth are going to be taxable. So now you got $6 million worth of taxes because you're trying to avoid bracket creep. 6 is taxes on 6 million dollars because you're trying to avoid bracket creep instead of taxes on 1.5.

So I'm going to move the bulk of it. I'm going to move it pretty quickly. I'm tempted to do it all at once. I'm not sure that the math works on that just sitting here doing it in my head. But I'm probably going to do it in no longer than 3 years.

I'm going to do a half million taxes on that. You're going to pay the taxes, but you're going to pay taxes on 6 million dollars if you don't. So someday you're going to pay the taxes and you're going to pay taxes on more and more and more every year that you don't move it. That's the downside. You can't get ahead of this creeping it.

And so you've got to chunk it to get there. And if you've got the money to pay the taxes somewhere, then I'm going to do it.

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

That's RamseySolutions.com. [Music] Everyone needs insurance, you need defense and offense. It can be hard trying to find pros aren't just looking to make a book and agents who really know there's stuff. Ramsey trusted insurance pros are vetted by us and coached by us to make sure they're market experts.

And make sure they have the heart of a teacher and your best interest at heart. Go to RamseySolutions.com/coverage to find the type of insurance you're looking for and connect with a Ramsey trusted agent. Tucker is in Brecken Ridge. Hi, Tucker, how are you? Hey, I'll do straight to my question.

As I said, I live near Brecken Ridge, Colorado where housing prices are very high. Local governments have created work for housing programs. Absolutely. Most of the ski resorts have.

“Yeah, so you must live and work locally.”

You cannot own in the other real estate and appreciation is kept at 2 to 3% per year. We currently are on a market rate. Two-bedroom condo worth about 750,000. We could move laterally or even down in value into it as say a four-bedroom work force home. What's your opinion?

We would not do that. No. The reason for owning real estate is the appreciation. The purpose of the work force housing is to try to keep work force that can work the ski resort.

And you can afford to live there because we're dealing with $10 million houses everywhere, right?

And so, and condos that are $3 million in everything else. It's hard to be a bartender and live there unless you have work force housing. And so, most of the ski resorts have done that. But that doesn't mean that you purchasing something that's appreciation capped is good for you. It's just a way to get people to work the mountain.

That's the reason they're doing it. And so, I don't know, you're past that. You are now a condo owner that's going up in value. And so, you know, my guess is your family's growing in the two-bedroom condos getting tight. Yeah.

Golden retriever would be like a yard. That's the family growing. Well, the golden is a great dog. You're with your brother as well. Yeah.

Yeah. I would like for the golden to have a dog too, but I don't want to lose 700 grand for that.

“And that's what you're going to increase in value.”

So, how long have you owned the condo? Three years on this one. Okay. On this one. You lived in the area though, for a while?

Yeah, this is the second property I've owned. Okay. There are full times at your primary residence. Correct. Yeah.

So, my reason for my question is still, it's easy for you to answer. Think about all those years ago when you bought the first one. Versus what prices are now. And that's why I'm telling you not to do an appreciation cap to work for housing. Yeah.

Understood.

I'm a real estate agent up here, so that has always been my inclination.

Kind of kind of project housing. Well, it isn't. It isn't. But it's a, it's a government subsidized thing to create a labor supply that is needed. And that's, that's not invalid because it's.

But it's not where I'd put my primary residence. But I don't want to, yeah. I don't want to bet my future on that. Yeah. You know, if you're a bartender in your single and you need to,

You know, then that, that's, that's why they did this.

Yes. So, to cover that and not for you.

“So, no, I, I would never take, I would never step out of the free market that is working into a subsidized market that is capped.”

Mm-hmm. That's bottom line. And it's just an expensive place, as you know, Tucker to live. So, that's. It's beautiful too.

Mm-hmm. Absolutely gorgeous. All right. Jason's in Pensacola. Hi, Jason.

How are you? Hi, guys. How you doing? Better than we deserve. What's up?

So, my fiance and I are trying to work through, based at two. And we've got about $60,000 in personal loans and credit card debt. And we've got $90,000 still left on the mortgage. Um, let's take on pay is about 130 grand a year. And we really committed to getting rid of this debt.

But we really want to get married about this time next year. So, I was wondering if you had any general advice advice about how to save for the lighting and also pay off as much as we can.

Yeah, well, first Jason, I would keep the debt and the income separate.

So, I'm just curious.

“The $60,000 is it pretty much $30 or who what makes up the $60,000?”

Uh, the majority of it is mine. Okay. About $5,000 is hers. Okay. And then how much is she making a year?

She is, she's netting, well, her growth pay is about 50,000 a year without overtime. Okay. And yours is 80. That's correct. Yeah.

Yeah. So, I mean, first and foremost, Jason, I really would.

I would not be paying on hers.

I wouldn't have her paying on yours. I think you guys functioning still as two single people during the debt pay off process. No sign on this shelf. No, no, we didn't. Who who's the name is it, under?

It's under my name. I actually actually worked with the home before we met. Okay. Okay. So, yeah.

So, I would just, I would just, she made 50 grand. Has no debt and you're deeply in debt. Excuse me. Yes. Right?

Yes. I was kind of sure about that. There is a small, whether it's a small caveat for the debt, 30,000 of that debt is currently being paid off. Student loan payment for the national guard. Okay.

When will that be completed? That'll be completed in about four years. Okay. While you're in the national guard, so it'll take the four years of service. Yes, man.

They make one lump sum payment on anniversary day every year. My listing. Okay. Um, I'd probably still make it a goal just, I mean, I don't know.

“I think I'd want to be done with it so that you have the ability to make decisions if something changes in your life.”

So, the question you asked though was, how do we say for a wedding while on baby step two? So, I would figure out, okay, what is probably, because, I mean, you know, you guys have debt. All of this other stuff is happening. I would say, what's the least wedding we can have that we would be okay with, right? And so you kind of look out to say, we're probably not going to go and have a $50,000 wedding, right?

So, how, what, what does the feel look like? Do we want venue church? Like, I would really look and kind of map out here would be my reasonable quote unquote dream wedding. And this is me if I'm, if I'm her. And then we back out the pricing and say, okay, here's probably what this is going to cost.

And you're going to see the price and probably like, okay, it's probably not what we can afford. Because that means we're going to have to save X amount every single month until the wedding. But we still have other roles. We're still wanting to put some towards the debt. And so, I, I would start to really paint this picture of what do we want this wedding to look like. And then once you have that realistic number of what you're shooting for to say, okay, then how much do we have to put aside each month to save for that wedding?

In junction with, though, having, you know, a goal to get this debt paid off, right, to be putting money towards the debt. So, it's kind of like a two for one, but it's going to be a check of expectations on what type of wedding you all will have. And at the rate at which you can save. Does that make sense? Yes, it does. I appreciate that. So, Jason, the way the language you used tells me that you've combined everything you're living together.

Everything, but a marriage. Yes, that's how you get married this weekend.

I mean, we get married this weekend and then live your life for a year and have a celebration in a year.

“Because you're fooling no one, not even yourselves. No one's fooled.”

You know, I mean, what is the deal here? You're already acting like it, so just be it. Yeah, I would get a pastor and get married this weekend if I were you. And then I would have a celebration a year from now and pay off as much debt as I can while budgeting for the celebration that looks a lot like a wedding.

You work your butt off for your money, but your money's never going to return the favor if all you do is hope for the best.

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Amy is an Austin Texas high Amy, how are you?

Hi, I'm doing well, how are you? Better than I deserve, what's up? Either I am calling to see what I need to disclose to my boyfriend. We've been together a little over a year. We have very different backgrounds and situations when it comes to employment, income savings, all the things.

And we're looking and discussing emerging homes, getting married, things of that nature. Just kind of trying to figure out what to disclose and when without giving all my cards away. Too early in the game if you will and just kind of where to go from here.

“So are you more successful financially than him than he is?”

Yes, yes. By how much do you think? Um, substantial.

I, to put it out there, I recent divorce, made over, you know, walked away with over a million dollars.

Cash and a home paid for car paid for, he's working two jobs, has two small kids, early any savings. The house is fully paid for in cash by me with my name on it solely. Just trying to figure out. Can you live in the boyfriend? No, not yet.

Oh. But we're we're getting there. Oh, but the house you're currently living in is what you're saying. Correct. Yeah.

How, uh, when, when did you get divorced? Uh, about over a year ago now over a year. How long have you guys been dating? Um, we have a funny, you ask, probably just shy of a year. Okay.

Um, so in general, the rule would be a relationship rule would be if you're going to share your life with someone before you agreed to do. That they should know who you are. For a hundred percent. And if you're uncomfortable them knowing who you are, you're not ready to spend your life with them. That's there.

“I think I'm just more hesitant how to do this in a smart way.”

I guess I don't want to overwhelm them. I am. I will tell you a very privileged situation where I'm a single mom's two kids. I'm not working. You have an income, a very substantial income as an equalization payment for divorce.

And what's this, how much do you get coming in? I get 10,000 a month. And how much do you think he is coming in? Probably 4,000. With two jobs.

Yes. All right. Okay. I don't think that's that far out of, uh, but what's out of culture is that you haven't, you got two things going to number one, you're a human, and you got your heart trampled on and it ended a year ago.

And so to jump back into the trust game is hard when you're wounded.

I mean, you should be a little bit standoffish after going to divorce.

It's just fresh, right? That would be normal. I mean, you're a weird, if you're like, oh, yeah, it's all okay. Now, I mean, that's that's the denial, right? I mean, your heart has had some healing to do the scars of the process you all went through there as some healing to do to be able to fully engage and trust someone else.

And so some good pre-marriage counseling is in order for sure. And I personally think it would be a huge mistake to live with someone, especially in this situation before you're married. Because it involves your paid for house and your income that's three to two and a half times of his. And you don't, you don't work.

Right.

“And so I think that's going to get weird fast as a shacked up boyfriend thing.”

So I would just stand off and say, we're going to continue our live separate until we are actually married. And we're going to enter disclosing this through a pre-marriage counseling process gradually and gently. And then a pre-nup is in order in this situation. Okay. Because it's substantially, we don't recommend pre-nups most of the time, but where there's a substantial difference between the two.

And with kids involved second marriages, I mean, it's just, yeah.

Yeah, and your, your, your, your, your, your, your, your, your, support payments are not based on you're not remarrying, right? Correct. It's more of an equalization payment as he wanted the investment accounts and he would make cash. Ah, okay. So it's to equal that out more or less.

I give you a significant amount in savings, cash upfront from selling homes and whatnot. Yeah. So I do have a large savings of the side, but how old are your children? Mine are elementary and middle school. So we're looking at him in 13.

They're younger, five and three. Okay. So you've, you've got up from today forward. The day you're married, forward. Be treating these children equally too.

Correct.

Because otherwise you're going to have the Cinderella syndrome going on.

And we don't want that. Yeah. I think it would be worth the time and the money. Amy, to do, which I think you will, you sound intelligent. So smart.

I think you wouldn't. But just sit down with, you know, in attorney. And right. And map this out really cleanly. And well, and again, is that the against him?

No, no, no, no. Yeah. But I mean, I think he's great. I didn't hear anything negative about him. No.

But the, the, and you're very wise. Directors point to realize these differences mean something. And then you're also very wise to say what we say it out loud is that the stuff's off so fresh. And to work through the emotions of all of that trust stuff. And not hold him accountable for things he didn't do that the X did.

And that's a process.

“That's a top of mind thing you have to do intentionally.”

Because your human nature is your body sees this up every time he makes some comment that sounds like the X. Your body just freaks out. Yeah, there's been a lot of therapy on my part. And it was emotionally abusive relationship that, you know, I had to be that role model for my kiddos. Wow.

So we got out of there. And I came out very, I kind of joke like thanks for the money and the trauma. It is, it is, it's been a lot of hard work. And this man that I'm with is very patient and he used to keep it as long as, you know, we're doing it together. Well, that, that graphs exactly into what we're suggesting.

Well, and and it's going to be a beautiful thing. I mean, if, if or when, I'm going to say when you guys get married, I mean, that's what's sounding like eventually that probably will happen. Because you're talking about living together. And, and there's a, there's a beautiful future for you guys when you say, yeah, you keep it separate. Which makes it so clean.

No weird and tangled emotions of who it was what I would. I wouldn't because of them. I mean, genuinely keep keep everything separate. You guys get married, come back from the honeymoon. It's the Brady Bunch situation. And at that point, he's going to know everything.

And, and what a beautiful life you guys get to start to build together. Do you know what I mean? Like it. You can see this money as as a gift and a tool and having him on board as well. And there's no level of him feeling, you know, you know, imasculated or anything, demasculated.

I mean, either one of the same thing. I mean, same thing. Do you know what I'm saying? But like you guys through an engagement process really work and build this new units of when it's going to happen.

“Right. But I, I think it really is important to keep the steps in order.”

Yeah. If that makes sense. Yeah. Yeah. I think that's exactly right.

So I'm excited. Because you've a process this so well to this point, all the stuff you've been through. And this is just the next step. And I predict that your radar is really good. And if he is,

Repossibility. He's healthy enough that he can graft right into this and that's our positive possibility. The negative possibilities are this causes him to not feel in need to produce.

“In which case he's opting out of your relationship or he's like freaked out in some other way.”

And that's another reason that he, you know, he doesn't make the cut. And so he gets to choose how he's going to react to this and how he's going to graft into this by meeting with good counselor along the way. And you guys talking it through. But when he has full knowledge of everything. His behavior is going to tell you whether he's a keeper at that point.

Okay. And if he's not, then that's just got signal for you to not do this. That it was a, you know, that he couldn't handle it because this all comes with the package called Amy. And she's worth it. And she's worth it.

And she's worth it, you know. So he wants to get the two kids and he gets the package. This is it, the former trauma, the healing. He gets all of it and it's wonderful. I hope it's a great second chapter for you, Amy.

Hey, man. [Music] Listen guys, I've heard just about every excuse for why folks think they can't get ahead with money. So let's go ahead and settle this right now. You get the final say on what happens with your money.

“That's why you have to start telling your money where to go.”

So you can stop wondering where it went. So if you're going to start winning with money, you have to get on a budget. And the easiest way to get started and stick to it is with the every dollar budget app. It'll help you make a plan for every single dollar coming in and every single dollar going out. Every single month and guess what, it's free.

So no excuses, download every dollar in the app store or Google Play today. [Music] Our scripture of the day first Timothy 1-5. The goal of our instruction is love from a pure heart and a good conscience and a sincere faith.

Louisiana Senator John Kennedy said always follow your heart but take your brain with you.

He's got some great one liners. He really does. Karen is in Orlando. Hi, Karen. How are you? Hi, good. Thank you. What's up?

“Well, my house has a leaky roof and I did take financial peace but I wound up in debt again.”

I just spent too much and made some bad decisions. I did wind up getting solar and getting a new roof with solar is almost twice as hard because they charge quite a bit just to take the panels off and put them back on. So the roofing job is quite more than a regular roofing job and then I'm thinking there could be water damage. So I'm just trying to think would it be better off to sell my house because I don't have my kids are grown and out of the house and just get an apartment or something or would it be better to keep the house and try to fix it and maybe turn my debt to that Trinity management or something like that.

What, what, you're turning your debt to what?

You've never heard of them. They said you recommended them on some gold debt Trinity management.

No, that would be people that lie. Oh dear. Okay. Dave recommended them. Is like a deck and thought like a deck and solidation company. Yeah, and they are our Christians.

No, they're not their liar. Oh, they're life. They're life. Oh, so Christians lie. Oh, no. Jesus may love them. I don't. Yeah. No, this is not true here at all. Oh, my gosh.

Are you sure that that isn't like I'm positive?

Some I've never endorsed Trinity anything.

Okay. Okay. The, um, yeah. Uh, okay. Anyways, so Karen, how much, how much? I'm assuming you have no money.

Um, no savings. That was one skill I didn't acquire. Because I always got my bills paid and I was usually out of debt.

But the savings part, I didn't know.

Hey, and you have debt? Yes. How much? Um, 30,000. In what? Um, credit card debt.

All credit card debt. Yeah, you pay cash for the shoulder. No, um, I'm still paying on that, too. Oh, why should I go on the shoulder? Um, I 40.

It was 60. But I've got it down to 40. It's at 4% interest. So I didn't think it was about a deal.

You really did flunk financial patient diversity.

Okay. Um, the, um, wow. All right, Ms. Karen. Um, well.

“So if you sell the house, what do you owe on the house?”

You owe 30. I don't owe anything. I'm just to sell you. Okay. That's good.

Yeah. What's the house worth? Um, I haven't officially got it a praise. But I've looked at similar homes. Uh, um, 300 to 400.

And, but it does have it need a new roof.

So I don't know how I need it. No, I mean, that's good. It's going to be a part of it. But the, uh, so. How much did you make a year?

About 48. Okay. What do you do for a living? Um, I work at it as assistant living. Um, okay.

Okay.

“So you, um, you have the 30,000 solar and what was the other day?”

One more credit card credit card credit card. 30,000 credit card. 30,000 credit card. Okay. So if you sold the house, you were a big free of the solar mess.

Mm-hmm. Which apparently was a mistake. Since you don't have the money to make a pay for it. And the credit cards could be paid off and you'd be dead free. And you could buy a $200,000 property that more suited your needs.

More condo, ask, probably not a single family. Yeah. What, what would you enjoy? What would you, if you could pick anything in the world that was for you today? Because the house sounds like it was purchased for a different phase of your life a few years ago.

Yeah, um, yeah, I had two children and um, the house is a four bedroom house. Um, I don't need something quite that big, but it seems like even the smaller homes are still pretty pricey nowadays. Yeah, everything is, but so jurors. Mm-hmm. If they're pricey, yours is pricey.

Okay. You know, yours isn't like all of a sudden on the, on the rubbish pile and then there's as gleaming castles. That's not the way it works. Right. Um, yeah, I think I think what I found were in your shoes.

I would want to gather some information and it would maybe lead me to the wisdom. If I know all the info, usually I make better decisions. So let's get to two, two bids on the roof, actual bids. Let's call a smart vester or a Ramsey trusted. I'm sorry, Ramsey trusted real estate agent.

Have them come out and do a comparative market analysis and tell you what they would list your home for and show you why. And then also take the get with that person and go look at some of the smaller shiny or lower slightly lower price where you could be a hundred percent debt free when you sell this and a hundred percent debt free when you buy the next one. Okay. And let's go go look at what you could actually live in and go, okay, I really like that. And I really like this number that the person's giving me on selling my house and I don't have to fix the roof and I can sell it as is.

And I can be out of debt and I'm going to cut up my credit cards and I'm going to live on a budget and we're going to put you back through financial peace as our guest. Oh yeah, absolutely. Or you may find that you can patch the roof for. Yeah, you know, half of what was quoted to you, right, just in one little area, I don't know. But that it just gives you options, Karen.

And but at the end of the day, I probably would downsize because of the not even just from the financial perspective part of that is motivating me for you, but also your season of life and where you are you're like, oh yeah, you you said it twice I don't need this I don't need it so. It could be a great move for you in this next part of your life. Yeah, and don't finance solar and cut up the credit cards Karen. If you do this move, the scary thing is when whether it's, you know, a massive, you know, payment people get from equity from a home that it sells or an inheritance or a lawsuit right and you get paid out like whatever it is.

“And when you go and clear that debt, you've not really changed Karen you've just made some decisions that have helped you financially, but you have to promise yourself.”

I've changed your behavior in that process, yes, never go back here again, because if you go and get a $200,000 house and you're debt free and everything and you go rack up credit card digger and we write back where you started so you've got you have to stay stay the course. Logins and Minneapolis. Hey, Logan, what's up. Hey folks, thanks for taking my call. Sure. How can we help.

Save more and rent for longer before jumping into a home at the end of our lease.

Can be. How far under market are you? We're paying about $1,300 for a place that should be probably to set around 22 to 2,500 if we're renting 10 or less equivalent. Okay, and so we're talking about $12,000 a year.

“Yep. Okay, and if in what price range home would you be buying?”

We're shooting for mid 200 to 300. How fast does that go up to $12,000?

One year? One year. So what you're saving, what you're saving in rent, the house you're getting ready to buy is probably going to go up about the same amount.

Sure. You see what I did.

I do. So it's okay, and it might be less because the appreciation rate depends on the depends on your area and so forth. The appreciation rate might not be 6% and it's like 3%. And so it might not be quite that much, but the point is it's not really saving. You're not really saving all of it because while you're saving rent, the other hand things going up close to the same amount.

“And so it's okay to do that if you want to do it.”

And I'm all for taking your time. Rent is patience, so get something for the patience. You know, I want to get a great buy on the other end of offset this. I want to bargain somewhere. Take that extra time and find something great. Get a deal.

Yeah, get a deal, man.

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