Afford Anything - How to Destroy Your Stupid Debt, with Steve Stewart (and the controversy around Dave Ramsey!)

Episode Date: February 22, 2016

#13: Steve and his wife got on the Dave Ramsey plan and they paid off their house! Plus, you'll want to check out Steve's little coaching trick of Rent vs Buy vs Invest. For more information, visit the show notes at https://affordanything.com/episode13 Learn more about your ad choices. Visit podcastchoices.com/adchoices

All right, ready? No. Just kidding. I was just kidding. I was just kidding. There's your blooper. I should have been recording that. You told me before that you were going to record and not tell me so you can capture

that. You really should, Paula. Well, I should have recorded that too. That's okay. I'm recording it on my side. Oh. You will learn, my young Padawan. Welcome to the Paula and Jay Money Show, a real and uncensored show about growing wealth and financial

freedom. Your host, Paula Pant, is a fun-loving globe charter who lives on the West Coast, focuses on real estate investing, and runs the blog at Affordainthing.com. Host J. Money is a husband and father of two who lives on the East Coast, focuses on saving money and runs the blog Budgets Are Sexy.com. While they may have wildly different approaches to building wealth, they both have your financial independence in mind. Which one most resonates with you? Find out. As you listen to the Money Show, here are your host, Paula Pat and Jay Money. What up, Jemani?

Hola. Oh, I could start saying hello to you in a bunch of different languages. Yeah, you do a really good accent the other day by accident. I don't remember what it was, but it was a good thing. But are we recording right now? We totally are. All right, well, continue on then. So today we've got a super cool guest on our show.

He's actually also the producer of our show. Yes, good, making him feel good while he's listening and recording this right now. I know. His name is Steve Stewart, and he's got a really cool story. He used to be once upon a time he was in consumer debt. He paid all of it off. He hustled his way out, partially by DJing, not to spoil his story, but he DJed his way out of debt. That's a good title, actually. And then even took the big-ass step of paying off his mortgage. That's right. We're going to. We're going to. We're going to chat with him about DJing your way out of debt, paying off your mortgage, and then we're kind of going to get into it a little bit about Dave Ramsey to see, you know, pros and cons and yays and nays and all of that.

So, yeah, this is a cool conversation. I had no idea that I found out a lot about Steve that I just didn't know. Yeah, Steve's a cool. And Steve's in our financial blogging community. He has podcasts. He's blogs. He's medicine person. So he's a good overall dude.

You know, this is a good episode to listen to. Cool. So without further ado, ladies and gentlemen, meet our producer, Steve Stewart. Well, welcome to the show, Steve Stewart. Oh, thanks, guys. This is probably going to be the most fun ahead all week. Man, so Steve, who are you? You know, that's the worst question to ever ask somebody on a podcast. You guys really need to learn how to do this, right? I know who Steve is. So Steve is our man that helps us with. the podcasting. How many years you've been

podcasting now, Steve? I launched my first show in 2010, so it's been just over five years. And how many episodes do you think you've done? Well, just for the Money Plan SOS podcast was 200 episodes. Nice. And then I host another show for a group of financial coaches

that I belong to. We've put out 30 some there. And then I just launched my new show, no debt, no credit, no problems. And that's got six episodes being released. There'll probably be more by the time people hear this. Congrats. So Steve is our You know, Paul and I, we wanted to do this podcast. We were slacking for four, five, six months. We didn't want to do the details. We didn't even listen to podcasts. We didn't know what the hell we're doing with podcasting.

But we wanted to talk about money and get our ideas out there. A man after my own heart right there. So someone in Facebook forum mentioned that Steve does this. And I was like, oh, yeah, we see that guy like every year. He's really part of a staple of our financial community and our FinCon conference. And so we pretty much reached out to him and said, And Steve's been really good. I mean, because of Steve, you're listening to this right now, like in a nutshell. Yeah. Yeah. Steve is the person who makes this happen. Yeah. So Steve edits our podcast and he gets paid for it. So he's a hustler.

There you go. And maybe let's start there, Steve. Like, what are, what do you do for a living? I know you blog, you podcast. I'm sure there's, you're doing all kinds of stuff over there. Yeah. Well, for 15 years, I actually was an internal auditor for CKE who was a parent company of Carl Jr.'s and Hardee's. And then I left that job in March of 2015 to pursue this full-time financial coaching. And this podcast production. That was recently. That was not even a year ago, yes. Congratulations.

Thanks. Thanks. One of the ways that I was able to do that was because my wife and I, we've been consumer debt-free since 2007. Woo-hoo. Congrats. Yeah. We'll talk a little bit more about the success stories in that little bit. And the failures.

I want the failures. Everyone always talks about all the good things and they always magically omit the bad things. Right, right. So the financial coaching has been my main focus along with, you know, just providing the financial education through podcasting. And then people like you have been reaching out saying, Steve, I want to talk, but I don't want to edit. So what do I do?

And so actually I've had four people in just our little circle of friends in the community reach out to me and say, Steve, help me with the show. because one thing you'll learn if you ever try to do a podcast is it takes a lot of time to produce a show. It's not just hit record and you put it out there 10 minutes later. It's a bit of a time suck. And especially in the beginning, there's so many things that we're trying to have to kneel down before we can actually hit publish. Right. Well, everything should be that way.

I mean, if you think about it, if you're starting a business, tooling up is going to be the biggest expense. Getting the equipment set up, getting the processes ready, getting the ball rolling is going to be. to be the biggest, hardest part of it all. And then once you get it going, maintenance and improving, that's not as hard and as expensive. Yeah, that's true. Like, for blogging, designing the website, I mean, I guess when you start a blog, you can just get a free design and blah, blah, blah, blah, blah.

But eventually you get to that point where you're like, okay, now I'm going to actually pay a website designer and a developer, you know, do this and that and the other. And yeah, there's a whole lot of that going on. I don't know about it. I mean, I've never paid anyone to design anything. my site. And actually, blogging for me is like the most simplest, easy, like, you can literally go to the WordPress and within like 30 seconds, like be a quote blogger, like have a blog, have a name and just start writing, which is, I love. And I know there's like, yeah, it's good to have, you know,

a nice design and all that. But honestly, blogging compared to podcasting, oh my gosh, I wanted to shoot myself in the face. Which I have, I mean, if you're not listening to this, I guess it never work, but are. Well, we look at your design skills, Jay. It looks like you take a, you know, a couple of markers

to a dollar bill, take a photo and upload that as your icon. You know, you got, you hush over there. You got George Washington with the,

with the blue hair and the little goatee beard, you know, seems like your branding is really working for you. Wait a minute. We've totally fallen off the rails.

Steve, back to you. What a surprise. This is about Steve, not us, Paula. What were we talking about? We were asked. Well, Steve, you quit your job and started full-time hustling. So, I mean, yeah, sorry, we've completely sidetracked.

This is why we have an editor like you. Let's see if this makes the cut, Steve. So for one year almost, you've been self-employed. And so far, what are your thoughts and any unexpected or you knew, like, what's the deal after year? You said it right there, unexpected because things don't always work out the way you want them to. and if you're not hustling with your side hustle, it's just not going to happen. I've been out doing some networking events, trying some new things, building some new products. Nothing's actually hit really hard yet.

And as you guys know, you don't make a lot of money with podcasting, you know, the actual show. So I do put a lot of time and effort in creating something really good, I think. And that's, you know, hopefully we're going to get some feedback on my show. People are saying that they like it. We'll see how that turns out as far as download numbers and getting sponsors in the future. You know, you really don't know what other people really want until you seem to hit on that nerve. Is that something that you guys have found? Well, I know for me, and the reason I ask is like, I'm so conservative that I never quit a job.

I never really start something new unless I know I'm real safe. Like when I started budgets are sexy, well, hey, I didn't know you can make money off online. I just didn't know anything. But I had a full-time job. And then when I realized, oh, man, this could be something, a career or money, I kept doing it. And then I realized, oh, man, like this could be something more than this, you know, like a real job. I only quit or technically I got laid off because it was the same day I went to quit. But I made sure that it was already working and I was making money.

So there was really no, like, surprise right from the get-go. I knew what I was dealing with. But now that I have this going, I do launch things on the side without any knowing, like, even this podcast. We don't know if it's going to be good or not. So I think that gives you some freedom. So I mean, I'm actually, you know, I guess my question for you is if you're testing out and doing all this stuff, I would imagine financially you're, you have a big huge padding and or you're financially free so you don't worry about the money as much. Where do you fall there? Well, my wife does have a day job and she actually gets paid pretty well. So we're

comfortable that way. We also, obviously, yeah, I'm big about staying out of debt. Get out of debt and stay out of debt. And then we accelerated our house payment to where we paid it off in December of 2014 instead of 2016. I'm sorry, say it again. December 2015 instead of the original date was going to be sometime in 2016. So we got a few months knocked off at the end there as well. Yeah, so completely debt-free, no payments, no worries.

I mean, this is what home ownership really is about. When you think about the benefits of owning a home, it isn't while you're paying the mortgage because there's a lot of expense in that. But once that $1,500 or $1,500 a month is gone, yay. Wow, I mean, what is your balance and your checking account look like on the first of the month now?

It really does take a lot of weight off of our shoulders. Well, and for you, you're pretty much buying your time to be a hustler entrepreneur. Like, you're not going to use that $1,500 and then go buy it, you know, a nice car. You know, like you're and get, well, you wouldn't do that because you don't like debt. But for you, this allows you the freedom to work on all these passion projects, I guess, is a good way to.

Right, exactly. We're maybe not saving as much into retirement as we want to, but we don't have to worry about having to create all this income to pay car payments and student loans and credit cards because we took care of that eight years ago. That stuff got out of our lives. We've been able to cash flow vacations. We've been able to cash flow, you know, all the car repairs. And we replaced every window in our house at the beginning of last year. all these things were paid for with cash because we didn't have to worry about the obligations other than the mortgage and now we don't have that anymore either.

That's awesome. What are you going to say, Paula? Oh, I was just going to ask. So how long, I'm really curious to know more about your journey out of debt in general and then the final house payment specifically. You want the long story? I do, actually, yeah. Sure.

Let me start with the house first because I've got this like burning question. So how long in total from when you bought the house? house to when you paid it off? How many years is that gap? Well, here's the crazy thing is when we originally bought it, and I didn't believe this until my wife brought out the paperwork a couple years ago. When we bought it, we bought it in the year 2000. And we bought it on a 5-1 arm. Oh, my gosh. And you know why? Why? Because that's what they told us was the right thing to do. Oh, these people. I didn't know any better. I didn't know anything about how money really worked until probably about 2003, 2004. So luckily, the interest rates did go down. We were able to

refinance in 2003 to a lower rate. So a 15-year loan from there actually should have had this house paid off by 2018. But along the way, when we had a little bit of extra money on top of all of our other savings goals, we'd throw a little bit more at the mortgage. So you refinanced into a 15-year fixed? Yes, then we went to a 15-year fixed because what we found was, let's start back at the beginning. In year 2000, when we bought the house, house, the interest rate was a seven and half, we'll say, I can't remember exactly. And that was a good rate based on a 5-1 arm, right? Well, as we know, interest rates dropped in the 2000s. They dropped all the way into, you know, up until the last few years. It's the lowest it's ever been.

So when we refinanced in 2003 into a 15 year, we were able to get it down to a five and three quarter, five in a third or something like that. And the actual payment that we had to make then was only about $100 more than what we were already paying as that 5-1 arm on a 30. So we decided, hey, you know, we've got ourselves established. Again, that time, we still had debt, but we didn't have a lot of debt. That's the good news for us as well. We didn't have a lot of debt. We had a car loan. We sometimes had some revolving credit card debt, but it wasn't anything outlandish. So we were able to make that extra $100 a month payment on the house to make it a $15 instead of a 30. So you paid $100 more than your regular mortgage and you saved 15 years and like, I don't know, how much was the house?

Like how much do you think you saved an interest? I mean, over $100,000, I would imagine. You know, I should probably do the math on that. All right. How much did you buy the house for if you're like that? The house was $150,000 back in the year 2000. Okay. And it's probably worth $212 right now, I think, is a lot.

what Zillow shows it at. Okay. But we refinanced, it was $123,000. In three years, we'd only paid it down from 150 to 123. That actually seems pretty good for three years. Well, we had thrown a little bit extra at the time then, too. Yeah. Not having a true game plan, we just, we were throwing money here and there. Oh, this is a good idea. Hey, we got a little extra money from Christmas. Let's throw it at the house. You know, I wanted to have the house paid off early. But looking at it from that date, we're like, oh, it'll just take us, you know, a couple of decades. That's what everyone says, yeah. And then they get to the decades and then they go buy another house and get right back into it again.

So it was 2003. We refinanced at the five and a third somewhere around that amount. It was $123,000 balance. And then we just started putting a little bit here. I know for a year I put $41 extra just because it made the payment around dollar amount. Sounds like a J money thing, doesn't it? I do exactly that. I round up to the nearest hundred.

Yep. Every single month for six years now, yep. There you go. And that helps chunk away a little bit, a little bit, little bit. And of course the interest savings is exponential when you think about it. And then we got to the 2014 and I'm looking, I'm like, I can see the bottom of my Excel spreadsheet now. I can see that final payment because we've been paying a little bit extra. And that's where we decided that somewhere in 2015, we're going to take some money out of savings and just pay it off. Yeah, and what was that feeling like? So did you literally like, I guess you didn't come with like a briefcase full of cash? Here, I'm done. It was all digital, wasn't it? I have a friend. Actually, it's a young couple from my church and they paid off their condo in like seven years. And they did this a couple years ago and they said, you know what, Steve?

They didn't sound the alarm. They didn't send off the balloon, you know, send off any fireworks or sparklers and there were no balloons. They didn't throw confetti. they just and they hate you for paying it down they're going to get money off of you so we went in fully knowing that there wasn't going to be a big celebration because we paid off our house because the bank was going to make any more money on us that way we walked in i actually did have the cash because the balance was less than five grand so we just took in a 2,500 bucks okay that's what that's that's all it was walked in with a hundred dollar bills the guy sat down he had to get a uh a letter stating the true actual balance. There's a $20 processing fee or something like that. I'm like, no problem. Of course. Of course there's a fee.

And, you know, the guy, once we were done, the guy shook our hands, said congratulations, and we were on our way. That was a body. Funny, dude. Wow. That's for you, man. I mean, I hate homeownership. Like, I get the feeling of being free. There's definitely something to be said about renting versus buying.

Right. Because either way, you've got a monthly payment, but with renting, there's a lot fewer expenses. And there's a lot less responsibility. I think that's one thing a lot of home buyers don't understand. And, you know, you say you're building equity as you're paying the mortgage off. If you think about the math there, they say, you know, you need to have saved up or you need to spend three to five percent of your house value in repair and maintenance, right? Yeah, okay. Okay.

how much does a home actually appreciate every year? The long-term historic average is 3%, which is about what you spend on the maintenance. So you really kind of break even. The real benefit comes at the end, which is one of two ways. You pay off the house and you no longer have a monthly payment, which that takes a while.

Or two, when you sell the house and you get that tax break. And that's really about the benefit, I think. That's what I'm doing. I'm selling it and being done with it once and for all. Now, are you thinking about being a renter for the rest of your life, If I could have it my way, yes. We're renting right now and we're selling our house to be, it's technically a rental property, but we lose money because it wasn't meant to be that in the beginning.

So yeah, we've been renting for three years, almost three years, and I love it. And then there's water spots on the roof every now. And then I'm like, no problem. I'll just tell the property manager. You know, the dryer breaks? No problem. Like, I am so stressless. I love it.

Now, my wife and kids, you know, will something, you know, will they want to. to own and all that, possibly. But if I, my way, I would rent forever, honestly. You know, like the peace of mind to me is good. But I can see the advantages, right? Like if you said, hey, you know, here's a house free and clear. There's no mortgage on it. Would that change my mind my mind? Hell yeah. You know, I don't mind dealing with nuisances or paying a few hundred a month if I have a paid off house, you know. But my personality isn't going to wait 15, 20, 30 years. So I like the quick fix I invested into index funds. And that to me is like what I, you know, anything that I'm saving besides the mental stress from renting will all goes into,

you know, investing. So I just invest in a different way, really. This is, okay, I'm sorry. I'm just going to break in here. I wrote a blog post exactly about this. The title is renting is throwing your money away, right? I know. I read that one. Believe me. And, and it, It talks about exactly that. It talks about what would happen if instead of purchasing a home, you rented and used the excess money to invest in index funds. And like I walked through a whole bunch of different scenarios based on what's the interest rate that you're paying. How long are you going to live there? What is the price to rent ratio in your area? You know, like all of these different, because there's so many variables that go into it. So I walk through every single one of them. And one of the things that I got the biggest amount of fly. lack for was that I gave this hypothetical example of Rachel renter versus owner Owen. I like the alliteration. Yeah. And I gave Owen, Owen, the homeowner, a hypothetical interest rate at 5%. And like, my comment stream blew up with people who are like, 5% is an unrealistically high mortgage interest rate. Are you kidding me? Nobody would ever pay. And I'm like, you guys? Seriously? I'm raising my hand because that's what we were paying because we had a mortgage that we paid it we financed back in the early 2000s. Yeah.

It's 5.5 that I got in 2012 or 13. Exactly. I mean, it's nutty to me how there are all these people who are looking at who just look exactly at what the situation is at this specific point in time and also within their specific neighborhood. And then they take that and they apply it to the entire nation across all. decades and eras. Yeah, I'm sorry. That was just a quick rant that I had to do. What was your findings at the end?

Oh, basically the finding was that you have to do the math based on, based on the variables that are going to affect you, such as the interest rate you qualify for, the relative cost of both buying and renting in the neighborhood that you want to live in, the amount of time that you expect to live there. You know, like intuitively, we all know that if you're going to live somewhere for six months, renting is better. And if you're going to live somewhere for 600 years and pass it down through your family, then buying is better. So at some point in between six months and 600 years, we have a crossover point. Now, how do you find that? You do the math. So that was basically the purpose of the post was kids, do the math. And somehow people objected to that.

I remember reading it and at the end, because I remember thinking, all right, Paul, I'm ready to battle. I'm ready to battle. And at the end, I was like, oh, yeah, all this makes sense. Like, I didn't feel bad that I was renting. Like, I felt like, yeah, it's like justified based on my situation, my personality, you know, all that kind of stuff. So, yeah, it's a great article. We should link to that.

Steve, Steve, make sure to link to that. I like having you here. Future Steve, make a note of what Paula said two minutes ago. And, you know, in our friend Jim Collins, you know, he has a great articles on, you know, why home ownership is a horrible investment if you're buying a house just as, quote, an investment. And, you know, again, all the variables, but it was really fascinating, you know, how you can make more money if it's really an investment elsewhere versus the place you live. It doesn't say you can't own a home. It's just you don't think of your home as like,

this is my number one investment because all the money you're getting is different. You don't have any renters too. It's, you know, it's all, I mean, you guys know all this stuff, but we'll link, let's link to that, too, that article. Yeah, I would say that you can't look at your house as an investment because it's a use asset while you're living in it. Eventually, you can sell it, you can make the tax-free growth on it, which is great, but you've got all those expenses in between. Now, I'm not dissing owning a home, and I'm not dissing getting a mortgage so that you eventually will own the home, but you need to go forward with that. And if you're going to say that your home is an investment, look at it the same way that people say, you know, invest in

your marriage or invest in yourself. It's not monetary. It is not a monetary. It's really hard. Yeah. Marriage, yeah. If you were to buy another house, because you're Mr. Cassie, Man now, right? Are you opposed to getting a mortgage to buy another house down the road or will you pay only cash money if you can? If I can, I'd love to just pay for a brand new place. You know, I know what my wife wants in the future. I know what our goals are. She wants to get a ranch and I'm talking about with horses, not with just one level.

We're looking at land. We're looking at moving to a different state. We know that this is going to be after our daughter is either going to college or has gone to college. So we've got a few years for that. She turns 15 here in a couple of days. So we've got time. Now that we don't have a house payment, we have time to start investing and put more money away.

So eventually when we do move, we might end up getting a mortgage. We'll be okay with that, but it's not going to be a quarter million dollars. So you're not opposed to getting debt if it makes sense and it's really minimal. Because there's some people, I don't know, you remember Brad Schaffey from enemyadet.com.

Absolutely. You know, he was like, like hardcore, I don't want any credit score. I'm never paying mortgage. I'm going to pay cash. I'm saving up to buy a house in cash. And eventually, you know, life got in the way. And I haven't talked about a while, but like he did, I believe went back to mortgages because it made sense. So you're not like against it 100% just doing it in a smart way that's not going to screw yourself over. I'd have to rephrase what you originally said. I would not be adverse to getting a mortgage. That's the only thing. And it hasn't be reasonable. That's the thing. When I talk about

getting a new mortgage in the future, it can't be more than a quarter of what we bring home, you know, 25% of our take-home pay. Because there's so many other things we want to do with our income where if we got into a situation what was half our income, no. Now, if we get a mortgage and it's a quarter of our income, but then we have extra to send to it, which makes it like half of our income, that's our choice. That's our freedom by having no other obligations besides monthly bills. Right.

So it would have to be in a short term. would have to be, you know, a very small portion of our take-home pay. And I think we're going to get there because we're planning ahead for it. Yeah, it's amazing. Now, what was your thing you were going to give to us? Give it to us, Steve. I want a good one. I want to go back to that conversation of renting versus buying.

And let's use the scenario. Let's say that wherever you want to move, there is a house that fits what your needs are. Needs or wants? Once. Okay. So you go to an area where you want to move to. there's a house you can get for $250,000 and I hand you a check for $250,000.

Do you go and buy that home so now you don't have rent and you don't have to worry about a mortgage or do you invest it instead? I go investing right away. Really? Yeah. Okay, Paula. I would take out a primary resident mortgage

because I can get a lower interest rate on that and then I would use that $250,000 to buy a rental property in cash. Yes, she would, wouldn't she? You strategize. It's a simple question, Paula, which one? No, it makes sense. That makes sense for both of you. And for me, I would buy the house.

Now, there's two different scenarios in the lifestyles here as well. Paula is living the travel, I wouldn't say single life type, but she's much more mobile. Yes. Jay, you could be mobile, but you've got the responsibilities of a family. And that's similar to my situation. And I know that my family, my wife and my daughter, we like having the security of that place that we can call our own. So if you handed us that $250,000 and that could pay full price for the house that we want to get in the future, we would definitely buy the house. So it's a different answer three ways from all three of us.

Well, let me say this. You didn't ask me if I'd still be married if I took the money and invested it. my wife would take the house and not the investments. So in reality, I would say I want to invest. And my wife would say, no, I think it's best for the kids. And I'd side with her. And then I probably would buy the house outright. Okay.

Yes, yes. But if it was just me, if I was single, I would do the money. Okay. But again, I like the feeling, and this is what's taken me a while to realize, I like the feeling of knowing I have options, knowing I could move anytime or travel any time or just leave and never come back. With kids and a family, like the odds are getting slimmer and slimmer that we just get up and go.

But the feeling that freedom is enough for me to make a lot of decisions off of because I enjoy life more knowing it's a possibility. Yes. So to me, that's worth money. You know, like if I was in my hometown and you said I was going to be living here for the rest of my life, then hell, yeah, I'd be buying a property probably a lot more because I know this is it. but I don't like knowing.

Even if this house I'm in now that I'm renting, I rented for the rest of my life and you were to tell me tomorrow, I wouldn't want to know that. I like not knowing the answers. But that's me. I just turned 36, so that's a lot of years of me trying to figure out

why I'm so crazy in certain circumstances. And even buying my house, I mean, everyone I knew was doing it. They're buying. They were starting families. It was an American dream. Everyone, that's always said, you have to buy.

This is the next step. And I did it full well knowing it, probably would be a bad move, but I was like, you know, we'll let future J money deal with that. You know, like right now I'm going to be like a mature adult, right? What could go wrong? Yeah, what could go wrong? Interest only, no money down at all. What could go wrong?

You know, we're talking here on the podcast because it changed my life for the better. So I'm very glad I did that. But, you know, these are the things that most people, especially when they're young, they don't fully consider, you know, or maybe people are smarter than I'm. I don't know. but that's why I like talking about renting and buying because there's always like renting is bad and owning is good. And that's not the case for everyone. Right.

And that's why I brought up that scenario because you heard three different answers here for three different reasons. And there are many more. So our listeners should right now think about that. If I handed you a check for a quarter million dollars and that actually paid for the place that you want where you want to live, is that enough to make you buy the home? Or is there other reasons keeping you? and if that is the case that keeps you from buying that house, what is it? Well, and the second part is, what do you do once you now own the house? Most people say, you know what?

I don't want my crappy job anymore. Like now I just lost $1,500 a month or $2,000 a month payments. Now your whole life changes of opportunities because you don't need to make as much money. And that, to me, with the early retirement, extreme frugality, all that kind of movement that's going on, like that really, that was what struck me was like, oh my gosh, God. I was so, and Paul and I, like, debate on this, I was so gung-home, make money, make money, make money. Yeah, expenses are important, but make money. But when I realize I don't have to make more if my expenses are less, you know, it's common sense. But that was like, I mean, mind-blowing to me. Because in theory, if you like went from like $10,000 a month to $1,000 a month, you only need to make enough do enough work to earn $1,000 versus $10,000, which is a huge difference. Right? And when you have no mortgage to pay, that changes things too. So in my case, great, I have $250,000 invested in the market in your scenario,

but I still owe $1,500 a month on the house. So now I'm still forcing myself to work because I've got to pay off that house. And maybe five, 10 years. I'm like, you know what? I'm done with this payment. I'm ready to work less. I'm going to cash out my investments and pay it down in one fell swoop and be done. So life changes too. So I think another thing for me take away as I'm getting gray hairs in my beard and all that good stuff is that you can change your mind at any point for the most part for most situations. And that's why I love having savings or investments and debt in a way. You could always pay it off any time, but it's like your choice. And you'll get married and have kids and that changes. I used to pride myself in being a workaholic.

I work 60, 70, 80 hours a week and I'd brag about it. And then I had kids. I'm like, holy crap, life isn't about working, you know, or money. I was making so much money, it didn't matter. All I was doing was working. I think as long as you adapt and change and not be stubborn, you know, and then like, especially with like election year and politics stuff. Like I don't want to get like too off the deep end, but people always get slammed for

changing their minds on topics, you know, and like granted, like if you do it within days it's different. You know, but these people get slammed for something like 10, 15 years ago as if like their life never changed or the world never changed. You know, so I say anyone make the decision now. Yeah, think of your question. See how you answer it. You know, maybe do like a Google calendar item for five years and ask yourself the same question and see if the answer is the same. Ooh, I like that. That's good. That's the tip of the day. Set a Google calendar reminder to ask yourself a given question five years from now.

You know, Nate, St. Pierre, my friend and business partner that I did Love Drop, a philanthropy project back in the day. we had a friend Sarah and she'd always say hey in a month message me and see if I'm still at my job like I want to leave or whatever she was miserable so I set up calendar items

and then I did like a year and it would come up and I'd forward it to her and I say how you feel like she's like still at the damn job and then one time she wasn't she was done she's like I'm out of there oh so it won't work yeah it does work because it

yeah it gets you to stop and then most people quitting your job is a risky big ass move You know, so most people don't do it or they take a long time, but asking yourself, you know, and having other people ask you even more, you don't get down on yourself. You're like, what the hell's wrong with yourself? Like, why aren't you, you're all talking, but you're not taking action. I mean, that wasn't the reason she quit, but that helped, you know, in that process. That's a really good idea. Yeah. I have to wonder if your constant badgering every month was one of the reasons why she left. So leave her alone. Oh, you had to stop answering once she left. Yeah, yeah, yeah, you're right.

Yeah. I did one for myself. I was like, are you happy? And then like I did it for like three years. And it was interesting because I remember sitting down writing that and putting that into Google calendar. You know? And I remember thinking I was happy. And then sometimes they'd be like, well, parts of my life happy. Some isn't. Or sometimes business would be happy, but personal life wasn't or the opposite. Right. But it's just good to ask yourself like, and this is, you know, when people are dating or in bad relationships, you know, usually someone saying, hey, are you happy? And answering that question. question, you know, like it's just, I don't know, there's something, it's just powerful, you know, it doesn't matter what the answer is. It's just that you stopped and like, oh, crap, I'm not happy, you know, well, okay, and then it's up to you if you want to do something or not do something about it. Wow. Yes, you're getting all my tricks out of here. Life lessons. It's good. This is about Steve. I know. Actually, I have a question, Steve. Was there ever any point while you were in the process of paying off your house. Was there ever any point where you stopped to think, maybe I don't want to pay off my house? Maybe I want to do something else. For us, no, it wasn't that case. When my wife and I

found this house, we walked in the door and we immediately fell in love with it, which is a bad thing, by the way. But, you know, we said we would want to die here. Of course, that has changed over the past few years. We've got new goals. But the process of getting out of debt, not the process, but having gotten out of debt and having the house paid for, we knew we'd be. be able to save more for that next stage because we don't have the obligation now. And obviously we saved the interest. But now we can actually save more money because we don't have that, that $1,500 coming out every month.

So I never questioned it. Now, I will say that there were times when I questioned accelerating the payment because we had other goals. We pay cash for everything for vacations. I wanted to pay this thing off December of 2014, a year. earlier. My wife wasn't comfortable with it because we had some other things we wanted to do. One of the things was we wanted to get all the windows replaced in the house. And that was $7,500. That wouldn't have went a long way in getting this house paid off early. But because we decided,

yeah, the house is 28 years old. Yeah, it's really cold in St. Louis in the wintertime and the windows are drafty. All right, we'll go ahead and do that instead. Because we know that eventually the house is going to get paid off one way or another. So we just made that. that conscious decision of when to throw money at the house or when to use it for other things instead. Do you use credit cards or do you use debit cards or cash, like physical cash? I have zero credit cards. I have had no credit cards for eight years. When we decided to get out of debt in 2005, 2006, I stopped using them. And after a while, I was like, why don't I even have them here? So I just closed them. I cut up the cards. I have had no open lines of credit besides

a mortgage for eight years. And it's really not a big deal. What about your credit score and all that? Who cares. Well, yes. Who cares if you never get a mortgage again? So let's say next year you want to get a mortgage. Does it change or no?

No, because here's the thing. Well, first of all, I do have a credit score, and it's actually pretty good, which is weird, because, again, I've had no open lines of credit for almost eight years besides the mortgage. And actually, I was going to write a blog post about this. Let me pull it up real quick. my credit score actually went up in November of 2015 from previous years, which is weird because they say how many different lines of credit you have and the utilization rate and all that stuff. And all I have is the mortgage and it went up to 775.

Good for you. Who cares though? Because again, I'm not using my credit score. In fact, if I asked you Jay Money, when was the last time you used your credit score? Well, I used it for a blog post. But yes. Exactly. No, and I agree with you. The reason I'm asking is because you said there's a shot.

But like you won't need your credit score, but you'll need it to be high if you were to go buy your house and get a mortgage. Well, here's the thing. Or no. Here's the thing. There's a rule in the law that states that if a company wants to use a credit score to rate you for a loan, they are by law. They're required to accept anything that you provide to them that proves your creditworthiness. Okay. So we know that the credit score is based on lines of credit and if you don't pay something.

Your cell phone will never show up on your credit score or in your credit report unless you don't make the payment. If I don't borrow any more money, my credit score will disappear and I'll have zero credit. But I have a cable bill that they pay every month. I've got the cell phone payment. I've got the electric. There's a company called eCredible that does third-party verification of those payments. and as a third party, they can present that information to the lender, which again, by law, they have to accept this, and they have to take that into consideration.

That doesn't mean they have to? Yeah, exactly. Yeah, if you're a bank and you're trying to loan money to make money, why would you turn me down? So does your answer change if you go to get the house and let's see your credit score dropped a little bit? And let's say it's like 5% interest, but with the better credit score, could have been 2% interest. Now, A, does that matter?

would you've changed anything or B, it's like, well, no, because I'm taking out a lower amount. And so to compare, I have like 820 credit score and I have credit cards and everything and I only have one. I don't do like all this crazy ways to get my score up high, you know. And if it meant not getting into debt, would I swap with you and get 750 or 70, whatever? That's still good. Yeah, I'd swap because there's not that much of a difference. You know, I think it might be a bigger thing if someone had like a crappy credit score and then they were going to go to buy a mortgage, you know, get a house. You know, but that's a question for you.

Well, it doesn't matter to you in the grand scheme of things if your interest rate is, let's say, two percent higher. See, I wouldn't look at it as percentage rate. I would look at it as can we make the payment. Okay. And I'm pretty sure that in that situation where we have no debt, we decide to take on a mortgage. We know that the mortgage is going to be a certain balance. If that payment is going to be, you know, a certain percentage of our income, we can handle

that, the percentage rate of the loan doesn't matter because as we've seen, I had a mortgage that was seven and three quarters or whatever back in the year 2000, and then we lowered it to five and five in the third. We could have refinanced in 2009, I think it was to four percent or something. And I did the math and it really wasn't going to save us a whole lot. We were going to accelerate the payments anyway. Okay. So the interest rate really didn't make a difference there in the way that we paid off this house. So why should I make the interest rate the only consideration for a loan in the future. It's like going into the car dealership.

You either ask how much or how much a month. It's a completely different question, completely different answer. And which one you ask, put you in a different class. So we're clear. Yeah, yeah. Tell us the difference.

So for regular people listening, they can understand. Sure. Well, if you go to buy a car and you ask how much it is, you're talking about the ultimate price. And if you go to buy a car and you ask how much a month,

well, they can extend that loan from four to five to six to almost seven years now to get you into that monthly payment, but you're going to eventually be paying more interest over the life of that loan than if you just had, you know, let's say it's a $20,000 car and you had $20,000,000 bucks. How much is that car? $19,99. Perfect.

Here's a check. How much a month? Oh, I can get you in that car for, you know, 400 a month. Oh, I've only got $350. We can do that. All right, right. Well, and so, yeah, so they're separate. So you could still, let's say I would go buy a $20,000 car right now.

I'm not going to use cash. I'm going to use credit just because, again, I'd rather have the money invested somewhere, right? So I could still go in the dealer and say, I want that $20,000 car, or how much is $20,000, and then we get it, and then I still finance it on my own or after you lock in the amount, then talk to them about financing there. Like, there are two separate things, right, at the dealership. So you're right. Stick with the purchase price, which matters the most.

Pretend you're going to pay with cash. And then if you get a loan, you do. you've already got your best deal in theory, right? Well, yeah, I'm just not deciding on what the interest rate is today compared to somebody else's. Okay, that's fair. I'm curious. Like, I guess this is the part that I have a hard time understanding. Like, the decision to not have at this point any open lines of credit because your mortgage is paid off and to potentially have a credit score suffer as a result, why wouldn't you just have one credit card that you immediately cut?

up so you're not actually using the card, but on paper, the card still technically exists. I don't know if that would really help a credit score that much, because they always talk about how the history of payments over time improves the score. Or let's see you buy something every month and paid off. Yeah, like a Netflix subscription. You know, that's just too much work for me. I'm too lazy. And I can't be trusted with it.

I cannot be trusted with a credit card. So for me, yeah. And if you want to deep dive. into something completely different. We can talk about why credit cards are against my religion, but we won't go there. Otherwise, this will go to a two-hour episode. Yeah. No, I think that was a great question by Paul and good answers.

That's the one that matters in the end. If you don't trust yourself, don't even, you know, like, look, you have your house paid off in 15 years and you're working towards the next big ultimate dream, you know, and you don't use a credit card. So obviously you can live life without a credit card. So I love that. I'm glad you answer that that way. We've traveled.

We've gone, you know, across state lines. We've flown. We've had, you know, rental cars, all with debit, all with debit and check. We've actually paid for it. We're about ready to put the deposit down on this summer's vacation, which is my wife and daughter's dream vacation. We've been there three times. We're going a fourth.

And it's not cheap, but, yeah, we're just paying cash for it, cash equivalence. And it's just so much easier. You know, when you go and you've got the majority of the bills already paid for, you know, It's like those cruises where it's all inclusive. You don't have to worry about anything. It's all there. It's already done. And once we get home, we don't have to look back at a credit card statement to pay it off.

We keep looking forward at what our next goal is. Good freedom. I mean, you are living the average person's, not that you're average, but the average person's dream of no debt and doing whatever the hell they want to do. No debt, no credit, no problems. Oh, look at that. Your podcast. Yeah. So, Steve, tell me about the.

We've talked about you paying off your mortgage, but tell me about your consumer debt story. Wife and I got married in 1999. Gosh, you start saying 19 and you feel so ancient. Don't worry. I was born in the 1900s. The 1900. That century. Yeah.

We both came into the marriage. I'd say we were responsible with money. We're doing the right things with money as far as, you know, we didn't spend more than we made other than, you know, obviously. the house and when we get the car but we were able to make those payments so the consumer debt was always manageable for us and we were lucky i mean there there could have been an illness there could have been a big layoff you know any of those huge expenses that just put people under uh so i consider us lucky so you know there were times when we would have the you know two car loans but it was never more than you know a couple hundred bucks back then per month so we're

able to make that uh when we did decide to get out of debt. It was again, 2005, 2006. It was about $15,000 worth of consumer debt, which is mostly the car. My wife's SUV, which she still owns today, and some credit card debt. And that got paid off in 13 months, all of it. Once you made the plan? Once we decided. What was the plan? Yeah, so how did you do that? We followed Dave Ramsey's Financial Peace University plan.

We got, we already had some money in savings. We always wanted to have savings. And then we realized we needed to be more purposeful with what we're doing. We had the savings already put aside. Dave Ramsey preaches 1,000. I think we had a couple thousand. Then we just anything extra that we had, we threw at the debt. And we had, again, the credit cards were going really quickly. And then I had a side gig.

I've been a DJ on the side for three decades now. Wow. I never knew that. Yeah, you didn't mention that one earlier. I'm a jack of all trade. And a couple years prior to that, I met this guy who, for whatever reason he liked what I did, and he could book these incredible events,

which paid really well. So that summer of 2005 and into 2006, he gave me some really great gigs. One, I've been able to go back to a couple times, and that's Nissan's. They've got a facility just south of Nashville. You could have anywhere from 8,000 to 15,000 people to an event. It was amazing.

So I would get paid pretty good for that. Every penny that I made any of the gigs that I did that year, went towards paying off the SUV early. And that's how we get out of debt in 13 months. You hustled your way out of debt. That is awesome. And I think there's an important piece there because if we didn't already have a plan, I might have sent extra money to the car, but that extra money that I made from the gig, I might have

decided, okay, I need to take a little bit here, reinvest in the business, buy a new microphone or, hey, and let's go out to dinner because I've got this little extra money. Because the goal was to get out of debt, we threw every. dollar at the debt. And that's how we were able to do it in 13 months rather than in two years. So you plan for what you do with your money before you got it versus the other way around, which a lot of people do. Yes. We knew that any extra dollars that we had would go to that debt. So we make our monthly budget and then if anything extra comes in or we end up spending less than what we expected, we know where that extra money is going. It's going towards the goal.

The goal is the important thing. You got to have a goal. And the goal, could change, but for the most part, you want to hit the goal before you move to the next one. Yeah. And that was our goal. Get out of debt. This reminds me a lot of when I decided that I wanted to go travel. I got additional gigs on the side, and every single penny, after taxes, went into the travel fund. So there was never a question of, well, you know, I've got this extra gig.

Maybe I'll spend part of it on dinner and part of it on this and part of it on that. No, it was, I've got the goal. I've got the plan. every penny other than taxes is going to this. And did you reach your goal? I did, yes. I went off and traveled. For years, right?

For two years. Yeah, I was outside of the U.S. for two years, just backpacking. It's incredible. Hey, Steve, with the Dave Ramsey stuff, I feel like, I don't know much about him except from what I hear from people, and people either love them or hate him. My feeling is that they love that he's helping people get out of debt and he has this plan, whether you agree with, you know, debt first or emergency fund or the numbers. or percentages, right?

Most people, by and large, agree that Dave Ramsey helps a ton of people get out of debt, you know, which is a service. Now, it seems to me that whatever he talks about with investing, people like get so pissed off at him that it kind of wipes away all the good. Yeah. And from what I understand, you know, I don't know anything about the investing. I still am on the side of Dave Ramsey only for the debt part because obviously he's helping millions of people.

And he's super successful. He's like the best person in the world for debt. There's no one better than him. Do you know anything about the investing part or Paula, do you? Because, you know, I would imagine most people get out of debt. And they're like, great, Dave. I'm out of debt. I got savings.

What's next? What are I invest my money? And then he gives whatever apparently awful advice. Well, I can talk with authority on that because I'm a certified financial peace university workplace trainer. Okay. I got the training in 2007. And I also went back for the counselor training down there in 2009.

So I know his stuff very well. Are you biased because of it, I guess? I would say people can make that assumption, but I think that they'll learn that I'm not. When somebody says, Dave Ramsey says, I discount what they're saying immediately because it's like, don't just do what people say. You know, don't follow blindly. You need to understand and learn what it is he is saying and figure out if that actually does apply to you. And in most cases it does. Now, go back to the investing talk.

Dave Ramsey's recommendations. If you listen to the radio show, if you take his financial peace university, if you read his books, is to simply just take your money and put it in quarters. 25% in a small cap, 25% in the mid cap, 25% in a large cap. Oh, I was imagining stacks of quarters. I was like, that sounds heavy. So, and you're talking like stocks for people, like, because all these jargon, you know, I start to zone out. But small cap stocks, large cap stocks or what. So he gives you a guideline.

a generalization of what to invest in, which when we say large cap, we talk about mutual funds, not stocks, but mutual funds, which of course are stocks. It's just many, many pieces of stocks instead of a single stock. Or index funds would also qualify, right? I think so. Now, a lot of people say, well, Dave Ramsey says, I need to buy a large cap fund. That's all I'm going to do for 25% of my income. Okay, but which large cap fund are you going to invest in? Okay. Okay. So how people come off and get upset about his advice there, I think it's a bit unfounded because he doesn't give specific enough advice to push someone in the wrong direction. Okay. So he doesn't tell you what fun. Doesn't he own an investment fund or am I thinking of insurance? And is this more of an insurance thing? Because I feel like he owns a piece of, he owns a financial institution and maybe they just follow him because he's David. I don't know. There's like there's all these articles that. break it down like quote by quote and and they're all they are specific so i don't know if i'm

you know and again i don't know them so it's hard for me to follow all i don't i don't know if he owns any financial service companies okay other than his own or gets like kickbacks or anything or i'm sure he gets advertising he works really closely with uh churchill mortgage and zander insurance and a couple companies like that but i don't think he has any true ownership in it okay so and of course if you're getting sponsorship money yes that could you know, bias your recommendations. But again, if we're recommending 25% small cap, 25% midcap, 25% large cap, and 25% international, where is somebody really going to be going wrong with investing if they're listening to Dave Ramsey, who the average person is a beginner in most

cases and they're learning how to get out of debt? They shouldn't be investing that much anyway. Right. And then Dave Ramsey recommends that you go and talk to a financial advisor. And yes, he recommends people who they've vetted and things like that. But then he recommends going talking to a professional so that once you get into that dollar amount range where you've invested in your 401k at work or, you know, outside of that, you actually have something you can go to a financial planner with that actually gives them something to work with. So I'm real defensive on the people who say Dave Ramsey's investing advice is horrible.

Well, it's very general in nature in the first place. And then he recommends you go talk to an expert later anyway. So if you're just following Dave Ramsey's advice of 25% 20, you missed the point. Maybe they think it's too vague or something. The criticism that I've always heard is people, the criticism I've heard is that he states that you could expect roughly 12% returns, which just sounds too high given historic performance of the equity. Oh, right. And the withdrawal rate of 8% and all that. Yeah, I don't know.

Let me get to the point. Let me get to the point where I'm actually ready to withdraw money from my account and then I'll make a decision. But in the meantime, I need to be investing in the market. I need to start saving money and I need to make smart decisions. And, you know, so the withdrawal rate, if Dave Ramsey's saying 12% keeps me from investing more money than I should, then again, I missed the point. In fact, if you follow Dave Ramsey's baby steps, should I go through the baby steps real quick? Yeah, please. He recommends.

Oh, wait, wait, wait, wait, Steve, can we make this interactive? since you know the seven baby steps by heart and I think I know it, can I say what I think they are and then you tell me if I'm right or wrong? Sure. Do I hit the family food button if you get it wrong? Oh, yeah, yes. I don't have that. They should totally have sound effects. Future Steve, remember to insert sound effect. Okay, go ahead. Start off. Okay. Okay. So number one is to save an emergency fund of $1,000. Number two is to order all of your debts based on balance. from smallest to largest, and make the minimum payments on everything, of course, and then

throw everything else at the smallest balance. Is that step number two? Yeah. Okay. You're right so far. Okay. Step number three is repeat until finished with debts? Not necessarily, because baby step two kind of says that.

Okay, okay. So then, okay, so I guess by step three, you'd be debt-free? Consumer debt-free. Consumer debt. Oh. Oh, that was a hint. Okay. So then step three would be...

Oh, I know. Step three is save a bigger emergency fund that represents three to six months of your expenses. Yes. That's step three. Wow, I didn't know that. Keep going.

Step four is to pay off your mortgage. Nope. Ah. Oh, no, no, no, no. I know, I know. Okay. Life insurance. No, no, no, no, no.

I know what it is. I know what it is. Step four is to contribute at least 15% to your 401. or equivalent retirement account. Retirement, yes. Yes. Is it 15%?

15%. Yeah. Okay. Yeah. You're doing good. You're doing good. Are you looking at a website right now? No, no.

I went on a Dave Ramsey kick for a little while. Okay. All right. Well, you're only halfway there, so don't cheer too much. So, okay, so step four is 15% into a retirement account. Step five is pay off your mortgage. Nope. When do I get to?

Take off the mortgage is a hard one step to cross. Okay, so hold on. Let me go through. Step one is $1,000 in an emergency fund. Step two is pay off your debts, smallest to largest. Step three is three to six months emergency fund. Step four is retirement account. Step five.

What do I have, Paula, that you don't have, and she's 15 years old? College savings. College savings account. Exactly. So I don't. Wow, I didn't realize college savings came before mortgage. What if you don't have kids? If you don't have kids, then you can skip baby Step 5.

Or if you choose not to save for your kids' college, then you just skip it. Okay. Okay, so step five is to contribute to a college savings account. And does he give guidelines on how much? Not really as dollar amounts because you never know where you're going to. It's all dependent on the age of your kid, where you think they're going to go. You know, he just recommends that whatever you do, it's usually in some kind of a tax advantage account. Right. And ESA 529, but make sure it's the right type of account. Okay. All right. So step five is

college savings. Step six is pay off your mortgage. Yay. Really? It's all in one step. How's that possible? If you do all that, you can take you 30 years or 15 years to get past that step. No. All right. No. I don't know. Well, okay, saving for retirement, baby step four is ongoing. Right. But because you have no consumer debt, because you have an emergency fund, you should have some extra cash flow to be able to do that and maybe even then start with kids college. I see. And if you're hitting those goals and still have money left over, then you can go to baby Step Six and that's what we were doing.

Again, we were talking about earlier how my wife and I have, we have different goals, savings goals, paying for the vacations and things like that for cash. That's why we didn't stop retirement to pay off the house really. We could have, but we decided it was important to invest. And we also decided it was important to save for our daughter's future. that took away some of the money to do baby step six, which is pay off the house early. I think that's not a baby step. I'm going to say baby, baby, baby big step.

But okay, you're the expert. I'm not, obviously. So big-ass step six. Yeah. Pay off your dinky mortgage. Pay off your mortgage. And then step seven is to give and invest. Yep.

It's just be wealthy. Really? Yep. Is there an eight step or no? There's a seven. No, because once you've got no concern. debt, no house payment, you're investing 15% for retirement, you're putting money away for your kids' college, what else are you going to do? You could live more, of course, and you probably will,

but you also have more money to invest, and it might even be more than what the maximum contribution can be for your retirement plans. That was really fun. Congratulations, guys. Congratulations, Paul, you passed. Thank you. Eve can tell you what you win. Just a smart pat on the electronic back here. I think we have to finish a thought that we were talking about a few minutes ago. And you were talking about Dave Ramsey's investing advice and white people. If you go back to those baby steps. Okay. So we're not investing at one. We're not investing at two. We're not investing at three. We're saving. But I'm not going to call that investing. Baby step four, 15 percent in retirement. Again, a very general term, though he does break it down. You only have a certain amount of, like in your 401k, you're only limited to like 20 places.

So he can't even inject his own in there anyways if you wanted to. Well, yeah, but that's where you use the general rule of large cap, midcap, small cap, stuff like that. But then when you got everything paid off and Baby Step 7 is build wealth and give a bunch of it away, building wealth, I mean, at that point, what are you spending your money on? If you're consuming everything that you make above your normal monthly bills at Baby Step 7, again, you miss the point. So when you're building wealth, that could be opening up a business. That could be investing in real estate. That could be anything outside of those normal four mutual funds that he recommends when people are getting started. And that's, again, where I'm going to defend Dave Ramsey on that point when he gives that recommendation.

He's not leading people astray. If you want to argue with the 12% rate of return, you know, actually I'm doing an experiment with betterment. I'm saving $100 a month. I'm going to do it for 40 years. Wow. Pretty God that I last. This is a long experience. And we will see if I get 12% over 40 years because that's what he says.

That's what people have a problem with. And, you know, yeah, I'll come back in 40 years and let you know. And if I'm wrong, guess what? I saved $100 more a month than I would have. All right. Oh, you are funny, dude. It's funny because I literally had no idea you are associated with Dave Ramsey at all. I didn't know this either.

This is great. Well, I know you're invested in your community and your religion, right? Like, you know, you mentioned that in places. So I just, it's awesome that we have the person that's trained in all things Dave Ramsey. Yeah. I'd want to talk to you if I was needing someone to help me with a Dave Ramsey plan, is what it sounds like. Right. But I guess the reason why I don't use Dave Ramsey's name a lot and promote myself as a Dave

Ramsey coach, which I really can't because I'm not directly associated with him that way. is because then people immediately assume that everything that Dave Ramsey says is what I'm going to say. And I think it's very important that people realize that everybody's financial situation is different. Now, I'm still going to go through the guidelines that Dave Ramsey teaches because I believe them myself. I believe the steps work. I mean, if you think about it, we've learned all these bits and pieces of personal finance over the years, but when I've got this one, two, three, four, five, six, seven baby steps, that's really easy to understand. I'm more likely to follow it because I can remember that.

I don't have to sit there and look at a computer screen. I can just kind of remember that. It's very short, very easy. It's not easy getting out of debt. It's not easy getting through all that. But at least I can understand it and I can follow the process easier. I mean, hey, I almost recalled all of the baby steps. Yeah, yeah.

You know? Well, I think too, because I talk about money online a lot of times, you know, and you guys do too, we get questions like, hey, can you help me with my personal situation? I just want to be told what to do. When I was a money coached for two years, I even coached a personal finance blogger who helps people every single day blog about money. And they literally said, I know I'm supposed to know, blah, blah, blah. I want you to tell me what you think I should do and I'm going to go do it. And that was really shocking to me.

But when I thought about myself, I was like, yeah, like, what did I do with investing? I had my money all over the stock market in all crazy places. I tried following Warren Buffett. I tried picking my own. I listened to my friend. and then it took Jim Collins, you know, from JL Collins, nh.com, we could put that in the notes. Like I asked him, I said, you know, I keep hearing about index funds. If you were me, like, what would you literally do, right?

And I had researched a little bit. And he said, put all my money in Vanguard's total return index fund, VTSAX, Admiral Share. That's what I would do. And you know what I did? The next day, I cashed out and put $400,000 into that fund. You know, so it happens to me, too. The point I guess I'm trying to get at is a lot of people want to, to be told by someone reasonable with, you know, someone credible and trustworthy what to do

so they can do the stuff they want to do and not be bogged down with stuff that like they don't care about or they're not good at. And the problem with that is then you start to invest with Bernie Madoff. And you've got to think for yourself first. You've got to be critical about this advice you're getting. It doesn't matter where you're getting it from and internalize it. And does it make sense to you? Do you understand it?

Don't just follow somebody blindly. So that's again why I don't say Dave Ramsey says. I don't use Dave Ramsey's sayings because, yes, he's the guy I would recommend. He's the guy I would follow. And that's the guy that we basically followed in our journey to get out of debt and get to where we are today. But if I just said, do what Dave Ramsey says, no, understand what it is he's saying and make sure that you understand it before you follow the advice. Yeah. No, yeah, I agree.

Well, and I pretty much said that just so that that that's like the second prong. It's not only like learn about it, but here's some actionable items that are factual, you know, 1,000 in an emergency fund. Like everyone gets it and it gives you like a win, you know, do this with your credit cards in this order. You know, like there's other ways to pay off your credit card, but he tells you this is a good plan, you know, so you do what he says once you believe and trust him. So that's what I like about him is he gives specifics. You know, the investing stuff aside, whatever, like, I don't know, maybe that's all. I don't know. It's hard because a lot of people that are saying this are all people that I respect, you know, in the financial world or that like are successful, you know, so it's always weird for me. But again, I don't, I'm just listening to hearsay and I'm not doing the research myself. So you know, I will, I'll just jump in here and say, Will and I listen to Dave Ramsey for a long time. And we didn't have any debt other than our mortgages. We never have. But we still went through this phase where we were listening to a lot of Dave Ramsey. will more so than I, just because, I mean, for me, partially because I'm a finance blogger,

so I want to hear what other people are saying. That's just part of research and education in terms of being a finance blogger. But also because, you know, the way Will explained it, he was like, this is the advice that I would have wanted my dad to tell me if my dad had been the type of person to give me good financial advice. Yeah, that's good. Yeah, think about this way. If you're the average American and you listen to Dave Ramsey, you know, the advice he gives is going to be fine. If you're the average American, you listen to Susie Orman, the advice you're going to get is going to be fine. David Bach, it's going to be fine. If you're Donald Trump and you listen to Dave Ramsey, you're on a completely huge plateau. It's a completely different scenario because

his financial situation does not match the advice that Dave Ramsey would give. Apollo, your financial situation really doesn't fit a Dave Ramsey thing because you want to make money in rental real estate. He does recommend that, but he does fixate on that in any of the baby steps until you get to seven. But it doesn't matter. I mean, you understand it. You know how it works. You've done it. And it's working. And, you know, you're still learning about real estate, aren't you? Yeah, absolutely. And when we first encountered Dave Ramsey, we were like, hey, we're already on step seven. Cool. People love them or hate him for some reason. So I think we got some, a little more clarity,

I feel like, talking to you about it. I'm glad that this show is about me then. That's right. If you need debt help, go to Steve Stewart. And then if he doesn't do it for you, go to Dave Rams. Oh, man, dude. It's been awesome having you on the show. I really appreciate it. Yeah.

Yeah, this has been fun. Well, thank you, Steve, man. And have fun editing your own words. Hey, we got to have that call to action here to end it up, right? So you ready? Yes. The audience is called to action to set yourself a Google Calendar event for one year. to ask yourself if you're happy.

Oh. Do that. And then call in the show Dave Ramsey style and we'll ring a bell or whatever crazy stuff. We'll do a happy scream. Thank you, Steve. Thank you, guys. We'd like to thank our sponsors.

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