The Ramsey Show - App - A Debt-Free Scream From Germany! (Hour 3)

Episode Date: February 7, 2020

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live from the headquarters of Ramsey Solutions broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. You jump in, we'll talk about your life and your money. It's a free call at 888-825-5225. Janice is with us in Dallas, Texas. Hi, Janice.

How are you? I'm fine, Dave. Thanks for taking my call. Sure. What's up? I had made a mistake and bought a whole life policy, and I got into some financial trouble, and I took some cash out on it, and I want to get rid of it. So what are your suggestions? Do you need life insurance? I mean, I took some cash out on it, and I want to get rid of it. So what are your suggestions?

Do you need life insurance? I mean, I have some. I got some through Zander last year. Okay. So you don't need this whole life policy for your family to be covered? No. Then just cancel it. Okay.

So I did go online, and there's an option to, like, could I cash it out or could I roll it over? Cash it out. Go ahead and cash it out. Cancel the entire policy and have them send you. They'll pay off the loan out of the proceeds of the cash value, and they'll send you the difference. They did not loan you 100% of the cash value. Right. Yeah, I still owe them some money on that loan.

Yeah, right. But they're going to repay that loan that loan will be zeroed and the cash value amount is larger than the loan amount so they will still send you some money okay but i don't know how much you know until you can look at the figures and tell but just cancel the policy you don't need to have a big discussion about it you don't need to talk to anybody about it just cancel the policy if You don't need to have a big discussion about it. You don't need to talk to anybody about it. Just cancel the policy if you have no need for it because you have your proper amount of term insurance in place. Isaiah is with us in Jacksonville, Florida. Isaiah, welcome to the Dave Ramsey Show.

Hi, Dave. Thanks for taking my call. Sure. What's up? I'm 20 years old, and I'm attending the University of North Florida here in Jacksonville, Florida, studying financial services. And I'm also a bit of an entrepreneur on the side, running a computer repair, refurbishment, and resale business. And I'm making about $130,000 to $150,000 a year. Of course, a lot of that is kind of tied up in inventory, but it's the profits there in the business.

And I'm curious how I should be treating my finances at this young age. I've been going on a few weekend excursions with my girlfriend. We don't eat out that much, but I'm spending between $3,000 and $4,000 a month. And so I'm just curious at this young age. I just contributed to my Roth IRA before this. And I'm just curious, as a young person making a little more than the typical college student or for young professionals, you know, how should we be treating our finances if we are making a little bit more than what is typical?

Well, there's not a we, it's a you. Well, yeah, right. Because you're not married. There's a we when you're married. The first thing is I would separate your business finances. You've got this side hustle going that's working from your personal finances. Are you running a separate accounting system and checkbook on that already? Yeah, it's an S corporation.

And it's completely separate. Good. So only when you pull money out of there does it become personal money. And until then, you may reinvest it. So we're going to keep those two things separate. Then the money you're bringing home, you need to be doing a budget on it. Jump on everydollar.com, download the app. It's free for your Android or your iPhone.

And, you know, lay you out a basic budget to live on and then stick to that. The thing is, you're making good money, so enjoy some of it. Invest some of it. Give some of it. If you have any debt, you need to clear that debt as soon as you can and go that route. But, you know, it sounds like you're doing great on the income side. You just need some method to keep you from overspending. And really, all a budget is is you're telling your money what to do

instead of wondering where it went. That's all it is. I feel guilty about my car because I've got two cars. I've got one for work, so I've got two car insurance payments. Is it paid for? I'm sorry? Are they paid for? They're paid for.

One is $25,000. It's actually on the market right now, and my other one is $6,000, just Mazda wagon. If you make $130,000 a year, you don't have anything to feel guilty about having $30,000 in vehicles. Okay, even at my age? Age doesn't have anything to do with it. I just look at the compound interest, and it's like lost opportunity. Age doesn't have anything to do with it. Not even for a compound factor in the long run?

Well, if you want to use compound factor as your reasoning, no one should ever drive a car over $1,000. You're right. But that's absurd. And so we're going to enjoy some of the money and enjoy a nice car. You're killing it, man. But always be giving, always be investing and taking advantage of compound interest like you're saying.

Those kinds of things. So systematically be enjoying the money, giving the money and investing the money. Constantly those three things. Just systematically be enjoying the money, giving the money, and investing the money. Constantly those three things. Just keep those three things going. And the only way you're going to do that is do it on purpose. And the intentional, purposeful plan with money, telling your money what to do, is a budget. That's all it is.

You're setting a goal for those dollars. You're saying, this many dollars I'm going to spend on weekends, and if I go over that, I have a reason to feel guilty. If I go under that, I feel responsible, right? And I'm going to spend this much money on a car, and it's a reasonable amount given what I'm making. If your taxable income is $130,000 a year, you know, $30,000 worth of vehicles is not unreasonable. You know, we tell folks never to have more than half your annual income tied up in vehicles.

You're nowhere near that. I wouldn't suggest going up. There's no reason to go up. You got a great car. You're a single guy. Nothing wrong with that. But, you know, there's nothing here financially that says you're stupid for paying cash for a $25,000 car when you're 20-something years old and you made $130,000.

It's just fine. There's nothing wrong with thatsomething years old and you made $130,000. It's just fine. There's nothing wrong with that at all. So you're doing good, man. You're doing good. Congratulations on the income side. Just give yourself some set goals each month. This is how much we spend on, you know, excursions, travel. This is how much we spend on vehicle.

This is how much we spend on electricity. This is how much we're going to spend in restaurants. This is how much we're going to spend in the grocery store. And that list of this is how much I'm going to spend is added up is called your zero-based budget. Every dollar should be intentionally spent, invested, given on paper before the month begins. And that's what I would tell you to do every time. So thanks for the call. Open phones at 888-825-5225. Dave, what books would you recommend for learning how to grow a side hustle

into a full-time job or business without debt and with responsible growth uh well a lot of people start with our book entree leadership which is how we grew our business from a card table in my living room to where it is today a lot of ladies are picking up our book by christy wright business boutique equipping women to make money doing what they love a lot of side hustles going on there without a doubt um and then i would just start hitting stuff like, gosh, I'm trying to think who's doing some great stuff on that. The social media king is Gary Vee on that stuff. Jab, Jab, Jab, Right Hook is really good for the social media side of how to

generate money utilizing social media, using it as a gorilla marketing, so to speak. So I'd be picking that book up. It's a good book. That book's, what, three or four years old now, I guess. He may have done another one since then, and I may not know it. But Gary's an entertaining character and a lot of fun, a lot of fun. We have him on Entree Leadership Podcasts every so often.

He and I have done a couple of events together. So Seth Godin's stuff, anything Seth's doing, I'll help you with side hustle. Check his stuff out. And you can pick up his blog, and he writes a blog every day. And he's very, very diligent about it. And I'll be picking that up as well. Seth Godin, G-O-D-I-N. This is The Dave Ramsey Show.

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spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years, and our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. lavina is with us in dallas welcome to the dave ramsey show lavina hi thank you for taking my call i really really appreciate it. Sure. What's up? Okay, so me and my husband, we have been listening to you for the past couple of months. I wish I would have found you sooner. But we are on Baby Step number two. We paid off a couple of debts so far already.

But here's my issue. I'm just kind of looking for some encouragement or inspiration, so to speak. So I want to be able to pay off my debts faster. So I'm looking to start in my freelance web and graphic business again. But I've been kind of burnt in the past few years, and that's why I kind of just let it go, because I just lost encouragement, just having the fear of just getting back into business, don't know where to start. So I'm just looking for, if you give me any kind of inspiration, just to kind of get my feet going again and get back into business sure so uh how did you get burnt what do you mean

well i guess i was kind of selling myself short pretty much trying to get the best bang for my bug um for a customer's bug trying to you know lower my price compared to other people's prices. So you didn't get burnt. Nobody messed you over. You just didn't charge enough. Yeah, and I think that's the fear of just charging what I want to charge and then telling me, well, you cost too much money. So let me think here.

You currently are working? Yes, I am full-time. So this is all side hustle we're talking about? It is side hustle, yes. So every dollar you get doing this is a dollar you didn't have. There's no downside. Right. The only downside is somebody might say you're overpriced.

Right. People tell me that all the time. And I give free advice. But listen, if you do anything, somebody's not going to like it. So just be ready for that, right? Right. So just do it anyway. Go be somebody. I mean, charge, you need to charge.

Whatever your price is, we're going to want you to double them. Because I don't care if you work. You're already making money. This is just a side hustle. It's extra money. It's an experiment. And it'll be really good for you for the first time in your life to declare to the marketplace that you are valuable. It'll be good for your soul.

Just throw your shoulders back and say, I'm worth it. Right? Yes, sir. You kind of need that, because last time you kind of felt like, I'm not worthy. And you know, here's what's weird with some things. If you undercharge, people think you're not any good. You know what I mean? Sometimes when people overcharge, you're like, wow, they must really know what they're doing.

And just whatever you were charging before, I want you to charge a lot more. And I want you to do, if you do half the work and you charge double, you'll make the same money. That make sense? That make sense? That makes sense. And then you can just go, well, I'm worth it, and I kind of pick and choose, do whatever I want to do. I don't have to do any of this. I'm just only going to do the ones that make sense, and the ones that make sense are the ones I want to do, because I get paid a lot, because that's the purpose of business. This not a it's not a hobby it's for money right and so i i think you can do it the good news is you don't have to do it to eat right it's not like you can't pay your

bills if somebody rejects you and i really want someone to reject you i'm sorry i think the rejection part it really gets to me you know yeah because you're taking it too personal let me ask you something if you're driving down the street and you see two restaurants and you decide to eat in one the guy that you didn't go to the restaurant you didn't go to you just rejected them was that personal no i just wanted chicken today i didn't go to the restaurant you didn't go to you just rejected them was that personal no i just wanted chicken today i didn't want steak or vice versa right and so some days you're chicken some days you're steak who cares some people like suzy orman they don't like dave ramsey that's fine suzy suzy's awesome she does great work some people like robert kiyosaki they don't like Dave Ramsey. That's fine. Susie's awesome. She does great work.

Some people like Robert Kiyosaki. They don't like Dave Ramsey. That's okay. They're both great people. That's not necessarily a rejection of me. Now, sometimes you get people on Twitter that are just nasty, but that's just part of moving around. I really, if I were you, i would be so proud of the quality of

work you put out that you don't worry about it when people reject the bible calls that a fear of man that rejection thing fear of what other people think right right and i just you know are you good at what you do i am okay then what's it matters if somebody let me tell you this here's an interesting thing okay 92 of the reviews of the total money makeover book are four and five stars okay that's a pretty good vote on amazon right right? Right. 1% or 2% are one-star reviews. I think it's safe to say that the one-star reviews, when it's only 2%, 98% are not one-stars. 98% customer satisfaction. Does that make sense, reading that book?

I think it's safe to say those 2% are wrong. They're wrong. I mean, when 98% of the people say something's one way and 2% say they're not, they're wrong by definition. And so if 2% of your people don't like what you're doing? By definition, they're wrong. If you can please 90%, you're a dadgum genius, you know, in this world. So just go do your work. Make your art. Ship something. Enjoy the process.

Expect people to be crazy sometimes because about 2% of the public should be institutionalized. I'm going to give you a copy of Christy Wright's book, Business Boutique, and I want you to jump on her website, businessboutique.com. A lot of people who start businesses, this is equipping women to make money doing what they love, a lot of people who start businesses face the same fear you face. When you first start charging for something that you're good at, it feels weird. Particularly if you're going to charge your friend for something you're good at, it feels weird. When I first started doing what I'm doing, I was doing financial counseling or financial coaching, and I was doing it as a ministry at my church. And then the first time I ever

charged somebody an hourly rate to sit down and tell them what to do with their money. The very first time I ever did that, that felt weird. I'm like, well, what if I give them the wrong advice? And then I thought, if I get them out of debt, how is it the wrong advice? I mean, nobody's going to be pissed off if you get them out of debt. So I'm going to try this. And I think I charged like $50 or something. It was like real money, you know. But we all face that thing of, you know, somebody might not like what I'm doing. Somebody might not like my art.

Well, paint anyway. And what you're feeling is a very human thing to feel but i want you to go do it anyway and then i want you to do so much of it that you almost get used to the criticism because there's one thing about this culture it is really good at criticizing now some of you have taken criticism to an art form level. You haven't got anything else to do. If you guys don't believe what I'm telling you is the truth, I want you to get an article that is written in a newspaper or on a website. Read the comments after the article.

You will find some of the dumbest, meanest human beings on the planet. Almost all of them are anonymous. Very few people have their real picture or their real name beside them. And they are nasty, angry, mean, critical people. There's a percentage of our public just spend all their time trolling. You know what? Go make your art anyway. Go help some people anyway.

Go serve anyway. You hang on, and Kelly will take care of you. This is the Dave Ramsey Show. Thank you. If you do this one simple thing that we all do, you are literally at risk of being hacked and someone stealing what you've worked so hard for. Do you ever use public Wi-Fi? I'm talking about getting online at a coffee shop, a store, the airport, or even at home. Hackers can use a simple $100 device to mimic Wi-Fi, and with just a little bit of skills, they can take over your financial life. This means you may think you're on your bank's site or app

or securely making that purchase online, but hackers could see and steal that information. That's why I trust CyberGhost VPN. CyberGhost thinks about cybercrime so you don't have to. You can try it for free for seven days, protect up to seven internet devices, and keep all of your internet connections secure. That's CyberGhost VPN. Download it today from your app store and be Base in Germany. Hey, guys, how are you? Hey, Dave, Ramstein Air Force Base in Germany. Hey, guys, how are you?

Hey, Dave, how you doing? I'm great. Welcome, welcome. I'm guessing you're in the military. Are you Air Force? No, sir. I'm actually a retired Army and now a Department of the Army civilian. We both work for the Army now.

Okay. Well, thank you for your service. We appreciate it. Cool. And you're calling all the way from Germany for a debt the Army now. Okay. Well, thank you for your service. We appreciate it. Cool. And you're calling all the way from Germany for a debt-free scream. Yes. Absolutely. Yes, sir.

Love it. How much have you paid off? We paid off roughly $95,500. Very cool. And how long did that take? Just about 18 months. Good for you. And what was your range of income during that time?

Well, we started out at $150,000, and then we decided to do a lifelong journey for me to come back to Germany. So we carried sacrifice. It was out of work for about three months, and we dropped to about $100,000. And now we're back up to $160,000 a year. Very good. Good for you guys. Fun. So what kind of debt was this $95,500?

Well, about $1,200 was taxes, $5,000 for a personal loan, $39,800 in stupid credit card debt, and about $49,300 in student loan debt. Cool. So what happened 18 months ago that made you guys decide it was time to clean this mess up? Well, I've been a long-time listener. I've been stuck on stupid with money for a long time. I actually paid off $100,000 before I met Carrie, and then we got married just about 18 months ago. So I had told her about you, saying your praises, and I told her, I said,

hey, we got to do this. We got to be legitimate and get this debt out of our lives. Okay, cool. So this was all her debt that she brought to the marriage because you were debt-free from before? No, no, not all of it. Just Sally Mae. Okay. Just Sally Mae. Okay, so you got out of debt, Tim, and then went back in.

Oh, absolutely. Like I said, I was the king of zero percent balance transfers, 90-day seamless cash. I got out of it and then went back in another $100,000. Yes, sir. Oh, my goodness. Okay, wow. So it's a one-two punch then. The two of you together have decided and you've cleaned up your repeat and her student loans.

That's good. So will you borrow ever again? Absolutely not. No. No, sir. You're done now, huh? Oh, yes, sir. Good, yes sir good good well congratulations you guys very well done how's it feel now that you don't have any payments it feels awesome awesome our marriage is prospering i feel free happy just it's wonderful. Very cool.

What do you tell people the key, the secret to getting out of debt is? It's definitely having a written budget and sitting down and communicating with each other and just being on the same page with your money. People think that a budget means sacrificing and giving things up. And when you're getting out of debt, you do have to make sacrifices. But the word budget does not equal restriction. It's just naming your money, and you have to understand that. Okay, cool.

Very cool. So how did you guys access our information? You listen on podcast, I assume. Yeah, we listen on podcast. And Carrie has a story to tell you about when we first met as far as how she got introduced to Dave Ramsey. Well, Dave, when we were engaged, we actually drove from Kentucky to El Paso twice and from Pittsburgh to El Paso once, and all those are pretty long drives. And when I tell you we listened to Dave Ramsey the whole way all three times, I mean we listen to dave ramsey the whole way tim listens to you all the time that's gross

i don't want to listen to me that long oh my gosh wow that's over the top oh my gosh well by the time you did that, you can answer all the questions, right? Yeah. Yeah. One day I want to do a financial piece, a coordinator, because I'm pretty good at this stuff now. I had a lot of practice. I think so. Well done, you guys.

Well, I hope you can lead a class right there in Germany. We need one there, I'm sure. So thanks a bunch, you guys. We've got a copy of Chris Hogan's book, Retire Inspired, for you. That is the next chapter in your story to be millionaires. You're well on your way and outrageously generous as you go along, okay? Thank you, sir. Congratulations, you two.

Very, very proud of you. You guys are heroes. Tim and Kerry from Germany, 95,500 paid off in 18 months, making 150, then 100, then 150, brand-new married, and they did it. Count it down. Let's hear a debt-free scream. Hi, Mom and Eric. Three, two, one, we're debt-free!

We're debt-free! That's how you do it right there. Congratulations, you guys. Very, very well done. Very well done. That is fabulous. Tim is in Glendale, California. Hey, Tim, how are you?

I'm doing very well, Dave. How about yourself? Better than I deserve. What's up? Well, basically, I'm looking at a pretty serious income problem right now. Just to give you some details, I've been self-employed for about seven years in the gig economy, doing go-to-release and things like that. And I also live in an apartment with some roommates. One of the roommates has moved out recently, and at about the same time, our lease has been renewed, so our rent has gone up. So my rent has gone up from about $575 a month to about $820. And at the same time, the company

that I primarily work for has been kind of slashing the amount of money that they've been paying us for each of our deliveries. So I used to be making about $700 to $800 a week, and now it's more like $500 to $600. Okay. And I'm just trying to figure out, like, I know I need to generate more income. I just don't know where to look. How old are you? I'm 39.

Okay. So what was your plan before this happened for your career? What were you planning to do? Like when you were 49, were you still going to be doing deliveries? No, I went to school. I did get a degree in television production, but I just was never really able to land a job in that field. And I essentially got into survival mode with bills and having to, you know, make sure that I still had food on the table and stuff. I'm glad you did that. I'm glad you're surviving.

I didn't suggest that. I was saying, but your plan was not to live the rest of your life in survival mode. No, it wasn't. So where are you going? What's your tenure? Where do you want to be in 10 years? That's the big issue is I don't really have a tenure plan at this point. The tenure plan was to be working in the field that I studied,

and it doesn't look like that's going to happen. Okay. Or maybe it manifests itself in a different way, like a YouTube setting or something like that. Yeah, potentially. Honestly, I'm starting to think maybe it's time for me to leave because I live in Southern California, and the cost of living is just so expensive out here. That's true.

And I feel like if I'm not going to get work in the television field, just find somewhere else in the country where it's less expensive to live and find another career path. Okay. That's fine. I don't have any issue with that at all. It's not a bad plan at all. The thing is, you need a plan. Because what happened was you went into survival mode because you didn't land on your original

plan, and you stayed there. And now this is God kicking you out of the nest and saying, you can't stay in survival mode. I've got more for you to do than that. Right. And so you might have sat there for you to do than that. Right. And so you might have sat there for another five years and just kept delivering. But this is your wake-up call. I think this is awesome.

It's a little scary. I got that. But it's awesome. Because I don't think you wanted to be doing this this long. And I know you didn't want to be doing it for another decade. So I think this is your dream time again. You kick your dreams back in, and you say, okay, what's my plan B with the television stuff? What is my plan B with the career thing?

And what are the best steps to take to get there, and what's the best city to do that in? And let's move in that direction physically and metaphorically as well. Hold on. I'm going to send you a copy of a book called Start. And I think it will help motivate you and get you moving along in this line. This is the Dave Ramsey Show. Our scripture of the day, Romans 12.2, Do not be conformed to this world, but be transformed by the renewal of your mind, that by testing you may discern what is the will of God,

what is good and acceptable and perfect. Douglas MacArthur said, You are remembered for the rules you break. Of God, what is good and acceptable and perfect. Douglas MacArthur said, you are remembered for the rules you break. Love it. Justin is with us in Provo, Utah. Hi, Justin. How are you? Good.

How are you, Dave? Better than I deserve. What's up? I'm in baby step two, and I make about $50,000 a year, and I have an opportunity to move to the Denver area and make about $95,000 a year. But my wife is unsure of it because the cost of living is so much higher. It would be close to tripling. No, it wouldn't.

For our housing, sorry, our housing costs. Denver is not triple Provo. I live in Price, so I live in an old coal community, so I pay $620 a month for my mortgage. And rentals out there are about $1,500 for one that's, you know, further away from the city but close enough to work. Okay. The real estate market in Denver is high, but the cost of living is not triple. And you can double your income.

If you would prefer to live in a rural setting and make $50,000 a year, there's nothing wrong with that. You haven't done anything wrong. But if she doesn't want to live in the big city of Denver, I get that. That's not a problem. If you want to pursue this career and double your income, basically, this is not a bad move at all. Mathematically, financially only, which is never how you look at something, but if that's all you're looking at, this is a move you make.

Okay. And then we have about $40,000 of equity in the home that we're in now. Would we sell the home? Absolutely. Absolutely you would sell it. Okay. Yeah, definitely. And then you'd start, you know, are you debt-free other than the home?

No, we have, but it's pretty close to breaking even after we sell the home. We maybe have another $5,000 or $10,000 payoffs after that. Oh, so you wouldn't quite be debt-free. Okay, well, you become debt-free, build your emergency fund, and start saving for a down payment to buy something in the Denver market. And hopefully your career will continue to flourish, and 95 is just the beginning. Yeah, that's what I'm hoping to. really want to stay there, there is nothing morally wrong with that. You're not a bad person for doing that, okay? And if that's what she's saying, you need to get to the bottom of that

before you take her to Denver and she's unhappy. But if it's just a financial discussion, I'd like to do it, but I'm a little bit afraid of the money, I'd go do it. Okay. Thanks for the call. Patty is in Columbus, Ohio. Hi, Patty, how are you? I'm great do it. Okay. Thanks for the call. Patty is in Columbus, Ohio. Hi, Patty. How are you?

I'm great. Thanks. Thanks for taking my call. Sure. What's up in your world? Nothing much. I have a question about a medical injury settlement that my son is being awarded. He's 10.

And what the insurance company is offering him is either a structured settlement or a cash settlement. And so I'm kind of wanting to weigh the pros and cons on both of them. I'm not real familiar with how that's going to look like for him. And my thoughts are if I take the money as a cash settlement, we could grow it better for him than it could if it's just a facility. But I don't know what that's going to look like, you know, in his future. Say, for example, if he doesn't go to college or if he doesn't want his scars, you know, repaired, you know, is that money going to be free to him to use if he wishes or is it strictly going to have to be for college or medical?

I don't know if those are terms that are specific to each of those options. Shouldn't be. It should be if they offer a lump sum or a structured settlement, either one. It should be for his use as he pleases and you please when he's a minor, within reason. Obviously, you're not going to spend the money on you. It's not yours. Right. And that kind of a thing um so as far as the actual crunching of

the numbers goes it's almost always better to take the lump sum if you're able to invest it okay and you don't you know you don't need it now um and you're not going to waste it and you're going to be in control and so forth you'll make a better rate of return than they have calculated the they've used some kind of an interest rate, a discount rate, it's called, to calculate the lump sum versus the structured settlement. And so because you're getting the money all now, it's called a present value formula in finance. In other words, would you rather have $100,000 today or $100,000 10 years from now?

Well, you'd rather have it today because you rather have $100,000 today or $100,000 10 years from now? Well, you'd rather have it today because you could turn $100,000 into a million and a half in 10 years, you know, investing it, right? And so you want to invest it and make that money on it as you go along. Maybe not quite a million and a half, but at least a million. So, you know, that kind of a thing. So that's the present value of money versus the future value of money. And that's how this calculation is done. So if you really want to crunch the numbers, and you probably should, it sounds like it's a substantial settlement,

get in touch with one of our smart investor pros and sit down with them. They're one of the investment professionals, and they can tell you what you can do there. Now, your attorney can tell you about what you're allowed to use it for and will the courts allow you to invest it. Sometimes a court settlement like this demands that you do something stupid with it, like put it in CDs, which is a ridiculous thing. But sometimes courts get all involved in it. And I don't know where you are with that. And you need to know that. But if you can take it and if you can invest it, it almost always comes out better for him.

It's going to be more money if you take the lump sum and invest it. But again, if you want to crunch that, just click smartvestor at DaveRamsey.com. Crunch the numbers with one of them. Put in your information. It drops down a list of smartvestor pros in your area. You select which one you want to talk to out of that list they are all people that we endorse are vetted that we've um they have the heart of a teacher and they can sit down crunch the numbers with you and go okay this is what this is worth this is in about a minute and

a half two minutes on a financial calculator you can put the numbers in and figure out what interest rate they're using and if you think you can get a better rate of return than the rate they're using, which I'll just about guarantee you it was at 6% that they used, then you can do that. They would much prefer you take the structured settlement because it's cheaper for them usually. So usually the lump sum is better for you. Manuel's with us in Dallas. Hey, Manuel, how are you? Hey, Manuel.

How are you? How are you? Hey, Manuel. How are you? How are you? I'm good. How are you? Better than I deserve. How can I help? Okay, so I have a question. My question is, about two years ago, I was 18.

I purchased a house through a private seller. The down payment was very low. It was about $4,000 for the down payment. And in return, you know, for that low down payment, the interest was very high. It's at a 12% interest. Holy. Right, right. And he said, the private lender said, you know, you can refinance in a year, which was my plan, but I had no credit to refinance the house.

Now, the payment for the house is $700, and that's for 30 years, and I'm giving $850 to finish in about 13 years. Now, my question for you is, do you think I can sell the house now and make $15,000 on it, and I would have those $15,000, and I don't know anything else besides that house. I still live at my parents' house. So do you think I should sell the house now and get the $15,000, or should I keep the house and just refinance and, you know, make more money in the long term?

Okay. If you call me up and you said, I'm 18 years old, I live with my parents, and I want to put $15 thousand dollars down and buy a rental house at twelve percent interest i would tell you no since that's where you're sitting today i would undo it and sell it yes i would sell it okay now if after selling it well what's the the next plan what would you do with the money what is your career? Right now I'm going to college, and I don't have any loans because I'm there on scholarship, so they pay everything. Good. I'm saving about $30,000 a year.

What are you studying? Criminal justice. Good for you. When will you graduate? In December I'll have my bachelor's degree. Well, good for you. You're early. Good for you.

Awesome. Well, I would park the $15,000 until you graduate to make sure that you're able to finish with no debt and then make it your emergency fund. When you come out, I take it you're going in the police force or something like that. Then I would, at that point, I would start looking to think about buying a home or just

renting and getting started on your own away from your parents. Thanks for calling in. That puts us out of the Dave Ramsey Show and 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. Hey, guys, it's Blake Thompson, Senior Executive Producer for The Dave Ramsey Show. This hour's over, but you can find more great content on our YouTube channel.

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