The Ramsey Show - App - A Double Dose of Inspiration for Your Debt-Free Journey (Hour 2)

Episode Date: November 5, 2018

The show about you

Live from the headquarters of Ramsey Solutions, 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 am 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. That's 888-825-5225. Marcos is with us in Dallas. Hi, Marcos.

How are you? Hey, Dave. How are you doing? Better than I deserve. How can I help? Thank you so much. And thank you so much for changing my life and processing money for the better. I really appreciate all the input you give out.

Thank you. How can I help? Yeah, well, I'm on baby step three. I have been working for a job for about 10 years, a major bank. I'm looking to change my career to my passion, which is personal training. And so it's kind of a scary time, and so I'm trying to see if you have any insight to what I can do to make this a smooth transition. Get your personal training income up close to your bank income, and then the transition

becomes a no-brainer, right? Right. The jump, the leap, is the one that is what scares you, and that's where people break their leg, is in the leap. So what do you make now at the bank? It's about $43,000. Good. And what is your personal training income currently running annually? Well, I was training at a small gym for a while, and then I realized that they take most of your profits, so I wanted to do it on my own.

So I actually don't have any clients yet. But my 10-year job told me that as of May, I will no longer have a position. So basically, as of May of next year, I won't have a position with that bank. And so then I will be – I have a choice of like getting a severance at that point. So what I was thinking is from here till May to save up as much as I can, I'll kind of finalize my fully funded emergency fund. And then from there I'll have a severance, which will be approximately about $15,000 to $18,000 to go with and kind of help me.

Are you married? I'm not. Okay. Yeah, I would definitely pile up every dime, squeeze every dime out I can do to get ready for May. And then the other thing you need to do is you need 64 clients. You need to be working all the time. As soon as you leave the bank, you need to be running out the back door in your shorts and shoes, ready to go work somebody out okay you got you need you need to have in-home clients uh wealthy people that

have their own gyms uh you need to have people that want to do outside workouts and you locate parks with stairs or whatever it is whatever your methodology is that you use that your differentiator um where you can get to people and you don't need a gym. Plus, you need to be thinking about how you're going to get a deal with a gym long term because you don't want to build one initially. Right. And so we need to be looking for a deal with a gym, looking for in-home, looking for outside stuff. Good news is you're in Dallas, so that's going to work fairly quickly in early next year. The weather will break in the south quicker, and you can get outside if you need to but uh what you need is a bunch of clients because basically what could happen is is the severance

pay could be your signing bonus to your new life let's pretend you made you had 25 or that you had 50 000 a year worth of clients by May. Okay. Then when they give you that severance check, it all goes in the bank, doesn't it? Right. And this is a, oh, you fired me. I didn't even notice. Right.

I have one more question, if you don't mind, as far as, like, investments, because I do have investments that I've had as my 401K through the bank. And, I mean, it's always been put into a S&P 500. I'm also given a pension that I will be able to roll over as well, but I've never done it before. This will be my first time, so I don't know what your best practices are on that. Okay. I would do a direct transfer rollover of everything that you're vested in, your 401K and if you're vested in your pension, into just a traditional IRA.

There will be no taxes on that at all. That's when you leave the bank. And I invest and I recommend people invest in mutual funds with long track records in four categories evenly, a fourth in each, growth I recommend people invest, in mutual funds with long track records in four categories evenly, a fourth in each, growth, growth in income, aggressive growth, and international. And that's what I would do there. Now, Marcus, I really want you to hear that first part of what we talked about. I'm not exaggerating.

I want you to run like your hair is on fire. Pretend like you're working with one of your clients and you're the client, only instead of weight loss and heart rate change and whatever other metric or measure you want to use to measure physical health, we're measuring your business health by whether you have $50,000 worth of clients a year. What do you charge a client? What do you charge a client? What would you charge a client if they came to you right now? It would probably be about either $40 or $50 per hour,

just depending on how many times they see me per week. Okay. All right. And so if we said $50,000, that's 1,000 hours, right, by $50, okay, which is 80 hours a week, okay? No, that's 80 hours a month. I'm sorry, 20 hours a week. And so 21 hours a week is all you've got to be working to break even on your bank job.

It's really doable. But you've got to believe it, and you've got to get out there and market yourself, and you've got to work at getting clients as hard as you want them to work at losing weight. Yeah, I mean, it's because I'm saving up money so I can have an opportunity to stay ill before I, you know. No, no, no, you're missing the point. I don't want you to use any of the saved money. Okay. You're not going to need any saved money if you do what I just told you to do.

You're going to be making as much if you have $50,000 worth of clients. If you have 21 hours a week booked at $50, you are making as much as you make at the bank. And I want 21 hours a week booked before May gets here on average. I want you to build that many customers, however many customers that it turns out to be. Okay? And then you won't need to touch your savings. Every time you tell me you want to touch your savings, you're telling me you don't believe

this business is going to succeed. And you're not going to do the work before you get laid off in May to make sure it succeeds. And this is the coach kicking you in the butt and telling you to do the push-up. Get it done. Get it done. You can do this. Emily is with us in Fort Lauderdale. Hi, Emily. How are you? I'm great, Dave. How are you? Better than I deserve. What's up? Okay, so my fiance and I have about $300,000 in debt.

Most of it is school loans. We have combined about $60,000 saved. Most of that is him working over the past five years because I've been in school. We've both read Total Money Makeover. We have the emergency fund of $1,000, and he's very, very nervous about putting a huge chunk of that $60,000 that he has. When are you getting married? 2020. Why?

Oh, why? Why so long? Because he says that he wants more financial stability basically because I haven't been working and he wants more stability. You've got $300,000 in debt. You're not going to have stability by 2020. Not with $60,000. So number one, there's not a we. I tell you what, hold on a minute. When we get back to this break, I'll walk you through this.

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He wants financial stability before they get married. They're scheduled to be married in 2020. I was pushing back against that as the old guy on the phone. So, anyway. All right, Emily, let's start again. You ready? Okay. Okay.

Yes. Number one, there is not a we legally speaking until you're married okay and so you have how much student loan debt mine alone is 250 okay so you're the majority of the student loan debt and he he has $50,000? Yes. And he has $60,000 in savings? Yes. He could completely wipe out his debt. And he makes how much a year? He makes between $65,000 and $75,000, depending on how much overtime he takes.

Okay. Were I to coach him as a single young man, which he is, who's engaged, I would tell him to pay off all of his debt today and have ten thousand dollars in the bank and uh begin to rebuild his savings because he's engaged to a girl with a lot of student loan debt and he's got to get he's got to get ready to marry her okay um that would be my coaching to him were he to follow the d Ramsey plan, okay? Because that's the shortest method or the shortest distance between broke and wealth is to get out of debt. It's the fastest way to build wealth.

And it's not to play footsie with debt while you've got money in the savings to pay it off, okay? Now, are you in school still? I just graduated past my boards. I start my new job next Monday. Past your boards. So you are school still? I just graduated, passed my boards. I start my new job next Monday. Passed your boards. So you are a doc? Doctor of physical therapy, yeah. Okay.

You're a PT. You're a PT for $250,000? It's under grand and out of state tuition. Man, you got hammered. Okay. So you're going to be making, what, probably $80,000, $60,000? and out-of-state tuition. Man, you got hammered. Okay, so you're going to be making what, probably $80, $60? Closer to $80, between $75 and $80, yeah. Okay, all right. And so what I would recommend, I don't think you have to be, you know,

you have a job, you've got a degree, he's got a job, he's got a degree, he's debt-free, then the two of you married would have a household income approaching $150,000 and clear up a $250,000 debt very, very quickly, like in probably less than three years. That's after we're married, because at that point we have debt and we have a household income, and everything's combined after marriage, okay? Right. And so I would not wait to get married.

You know, it's not going to, I mean, his requiring you to pay down your student loan debt to get married is kind of weird. No, that's not what I meant. He just, like, because I haven't been working. Yeah, but you are now. Yeah. I mean, if you got married in the spring, you're going to have your $80,000 income. He's going to have his $65,000 income. He's going to be debt-free with $10,000 in the bank.

And, you know, you're going to get married, and you're going to be making a really good income but have a lot of debt to clean up. And that's what I would do. I mean, if you want to get married this summer for instance and 19 instead of 20 i i just i don't tell people to wait until they get their finances straightened out to be married i tell them to wait until they're on the same page and in agreement about where we're going and that's what i would do so anyway that's my two cents and so you got more advice than you were looking for. In the lobby of Ramsey Solutions, Jeffrey and Belita are with us.

Hey, guys, how are you? Hey, doing great. We're doing good. Where do you guys live? Northeast Ohio. Very cool. And you're all the way to Nashville to do a debt-free scream. Yes, sir.

How much have you paid off? Just under $20,000 in about 23 months and three weeks. Good for you. And your household income during that time? Roughly $34,000, around $42,000. Very good. And what do you guys do for a living? Well, I'm an ordained minister and life coach, but I earn my income in a wood mill.

Okay. And I am a private violin teacher and a professional violinist. And I also have my own health and wellness business. And all of that generates only $34,000? Well, the health and wellness is just starting off in like ordained minister and life coach. I'm just starting off. Ah, I got you. They didn't really do much as far as our income. I got you.

So you're teaching some violin and you're working at the mill and then you're starting these other things. Exactly. That makes sense. What kind of debt was the $20,000? It was all my undergrad student loans. Okay. So what's your degree in? Masters of Music and Violin Performance.

Of course. Good. Cool. Yeah. And so you intend to continue that career, I assume? Yes. That and currently I'm at home because we just had a baby six weeks ago. Oh, fun.

So that. Very cool. How many children weeks ago. Oh fun. So that very cool. How many children? Three. Very good. Did you bring them along for the ride? They are here. Good good. So what made you go on this journey to knock out the twenty thousand dollars 23 months ago? Well we started dreaming and we realized what we wanted to do is help people, health, wellness, that's overall. And debt was just a bondage that we needed to get out of and help other people. And actually our story goes back to when we got married seven years ago. My parents gave us your CDs. And we actually listened to them on our way to our honeymoon.

But then we went a little Dave-ish. your CDs, and we actually listened to them on our way to our honeymoon. Oh. But then we went a little Dave-ish. Dave-ish. I was in school, and then once we got out of school, we did pay off $8,000 while I was in my last year of graduate school, and then we started having babies after we got out of school. So just everything came in and went out. I got you.

Okay. All right. Yeah. Cool. So how's it feel to be rid of all the debt? Oh, man. We can breathe. I love it.

Who was your biggest cheerleader while you were doing this? Our little girl, Lily. That's fun. Yeah. Yeah. We had a motto, debt free before three, which our son was turning three in June of this year. Our goal was to be debt free by the time he turned three.

And so we just chanted that every day. And it was really fun. But we actually made our goal by March instead of June. There you go. Very good. And half of what we paid off was actually in the last seven months. $10,000 in seven months. Wow.

So we cash flowed $7,250 to buy cars in 2016. Okay. All right. So you've been really on beans and rice. Yeah. She's got a great recipe. What do you tell people the key to getting out of debt is? Definitely the budget, which everyone says I know.

But for me, I like doing the budget i am the nerd because i have the notes which i've not looked at yet but sticking to the budget is hardest for me because i doing the budget's one thing sticking to it there's the trick yeah so yeah and i would say knowing your why and then grit from there to stick to it. Yeah, the hustle, the grind. Yeah. The grind, the hustle. Yes.

That's what it's about. Yeah. Very good, you guys. Congratulations. Thank you. I'm proud of you. Very, very well done. Well, we got a copy of Chris Hogan's book for you, Retire Inspired, and that'll be the next

chapter in your story. Yes. You have to be millionaires and outrageously generous as you go along. Absolutely. And let's get the kids into the shot so that we can get them on the YouTube for their debt-free scream. Brand new little baby. Oh, Janelle hated getting to hold that.

Oh, my gosh. So it's the names of the babies? Lillian, Judah, and Nadia. All right. Beautiful. Look at me. Debt-free by three. Yes. I love it. Very,. Beautiful. Debt free by three. Yes.

I love it. Very, very good. $20,000 paid off in 23 months, making $34,000 to $42,000. Jeffrey, Belita, Lillian, Judah, and Nadia. Count it down. Let's hear a debt free scream. Three, two, one. We're debt free!

Well done, well done. Well, you can do it if you make $134. You can do it if you make $34. It depends on how much debt you've got, how long it's going to take, and how deeply you cut. But here's the thing. There's an interesting correlation between these folks setting a goal to knock out their debt and their income going up. One in a hundred says their income went down while they were getting out of debt. Now, they're picking up side hustles.

They're doing all kinds of stuff. They're picking up extra hours. Sometimes they're picking up side hustles. They're doing all kinds of stuff. They're picking up extra hours. Sometimes they're changing careers. But something about this process wakes up your career choices and your decisions about side hustles more than anything else. Income goes up. That's part of the equation here, guys. You don't have to do it, but a large number of the debt-free screamers, you see that. This is the Dave Ramsey Show. There's nothing smart about smartphones if your wireless plan is blowing your budget each month.

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That's puretalkusa.com, promo code SAVEDAVE. In the lobby of Ramsey Solutions, LeBron and Jennifer are with us. Hey guys, how are you? How's it going Dave? Welcome, welcome. Good to have you. Thank you. We're glad to be here. So where do you guys live? We live in Maryland, right outside of Washington, D.C. Cool. Welcome to Nashville.

And here to do a debt-free scream. Yes. And how much have you paid off? $181,000. Good for you. And how long did this take? 42 months. Wow. And your And how long did this take? 42 months. Wow.

And your range of income during that time? We started at about $140,000, and now we're just north of $200,000. Wow. What do you guys do for a living? We're both consultants for the government. I'm in technology. I'm in human capital. Great. Very cool.

So what kind of debt was this $181,000? Everything. Yep. So we had about $25,000 in credit cards, $27,000 on a car that we sold after I talked to you, and we had about $129,000 in student loans. Okay. All right. Cool.

And so how long have you guys been married? Four years. Okay. So six months after marriage, somebody walks in and goes, wait a minute, we got to do something. Tell me what happened. Yeah, so we actually, a couple of months after getting married, we wanted to buy a house. You were broke? Yeah, we realized we were very broke.

But we had, you know, such a great income, and we just couldn't put it together and why we couldn't buy the house. Our debt to income ratio was just way too high. So when we were going through our premarital class, we had friends that had reached out to us and they had hosted FPU at their home, but it was the same day that we were having premarital at our church. So we were unable to join at that time, but, you know, past the house situation, I went to LeBron and I said, Hey, remember that Dave Ramsey guy that our friends mentioned to us? I think we should check him out. And he was like, no, not interested. So I was like, okay. But I, you know, I Googled, you know, financial planning, how to take control of your money, how to get out of debt.

And you're the only thing that comes up, Dave. So I came to him again and I said, I really think we should check this out. I really think we should do it. So we went online. We bought FPU. We did the home study. And then after the first session, we were hooked, mind blown. Like, we know nothing about money.

Wow. So, yeah. So, LeBron, you didn't want to do this, but she gets the DVD. She gets the home study. She puts them in. You're sitting there watching it. Arms are folded. Yeah, that's what I would have been.

I'd be like this right here. Exactly. Just like that. Right. Let's see this. Bring it. Bring it. Yeah.

So, what happened in the first lesson that made you actually go i can do this right so there was um part of that was uh there's a part in the first lesson where you talk about the credit card companies and then you did like a graphic of like how big they are um and you keep going on and that just really made me angry um and then i looked at that and i was just like, that's just not how I want to live. And you just hear all in the media that you need to have these things

and it was like the first person that says, you know, that I came across and said, you don't have to live like that. Like, there is another option and here's a plan

to how to get there. Then after that, became a Dave Ramsey fanatic and you couldn't tell me anything else. He actually wanted to cut up the cards like right there and I was like, wait, hold on. me anything else. He actually wanted to cut up the cards like right there.

And I was like, wait, hold on. Wait a second. He's in or he's out. I mean, he's hot or cold. He doesn't go in the middle. That's good. I like it. That is so fun.

So what advice do you have someone that's listening? What is the key to getting out of debt? Yeah, I think it's running your own race. So at our church, one of the subjects in our teachings was exactly that. And just in the day in which we live, you know, social media and things that are just right in front of you. You see your friends making great accomplishments and doing things, buying things. And it kind of gets you like, we should be doing that. We should be able to do that or we should be there already.

But I think it's really just knowing where you need to put your focus, where you need to be. Like Rachel says, love your life, not theirs. Yes, exactly. Exactly. Very cool. Very cool. Well, good for you guys. Very, very well done.

I'm proud of you. Great job. And you brought the kiddo with you. Yes, we did. We did. What is his name and age? you. Yes, we did. We did. What is his name and age? Noah. He's 11 months.

He'll be turning one in two weeks, actually. Oh, okay. Very cool. And we've got a copy of Chris Hogan's book for you, Retire Inspired. That is the next chapter in your story to not only be debt-free, but now be millionaires. Make it a couple of hundred with no debt. You ought to be able to do that. I love it.

All right, LeBron and Jennifer and Noah, Washington, D.C., $181,000 paid off in 42 months, making $140,000 to $200,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Love it!

That's how it's done right there. Man, beautifully done. Beautifully done. Olivia is with us in Knoxville. Hi, Olivia. Welcome to the Dave Ramsey Show. Hi, Dave. How are you? Better than I deserve. What's up? I am a 22-year-old recent graduate from the University of Tennessee.

I've proudly graduated top of the class from the College of Nursing. Wow, congratulations. Go Vols. Thank you. Thank you. Yes, go Vols for sure. I was able to move back in with my mom after college, and so I'm living at home with minimal, minimal expenses whatsoever,

no debt whatsoever. School is paid for via scholarships. My car has been paid off for some time now, and I just finished the total money makeover. And so I'm currently able to save around 60% to 65% of my take-home pay from the hospital every month. Is there a reason that you're living at home um i'm still in knoxville and i just didn't see a need to live anywhere else i have a great relationship with my mom and we love hanging out and being together so i moved back home to continue to save money. I lived at my church, actually, throughout college.

They had a really low rate for students to live there. And so once I graduated, I decided to come back home. Okay. I would put a one-year limit on that. Yes. Yeah, for sure going to be out of there in one year. Okay. All right.

I didn't know what your time frame was, but I don't want you there when you're 40. So that's awesome. So you're banking money for what purpose? Retirement, potential home down payment within the next 10 years or so. I'm dating a really great guy. We hope to be married by the, like, August, September of next year. Oh, well, there's when you move out. Okay, all right, cool.

Yeah, yeah. And so we'll obviously probably rent for some time during that he worked for um a campus ministry so we're not sure where we're subtle exactly wonderful um but right now the goals are to save for retirement um save for what might look like a down payment on a house and then my biggest question was um my mom really gave me an awesome gift growing up of not having to question where I went to school or what kind of degree I wanted to get or how much it would cost

because she had a nest egg for me that was my college funding. Wow. So even though I don't have children, would it be a good idea for me to start putting that $2,000 a year into educational IRAs? You can't.

That's what I was going to ask. You have to have a Social Security number, so they have to be born. Okay. And I wouldn't anyway. I think it's a wonderful mindset, and that means that you're going to do a great job of saving for college when you do have children, but it's just premature. Right now, I think you're being very smart.

Your first savings goal is an emergency fund, and let's call the emergency fund after you're married. Let's have that as the goal, and that would be three to six months of household expenses after you're married. You and your husband, new husband at that point, this time next year, have a household set up. You need three to six months of expenses of that as your rainy day fund. Your second goal would begin to save towards your down payment.

Your third goal would be to start putting 15% of your income into retirement. And then when babies come, you'll easily be able to add a monthly amount to start saving for college. And you've got plenty of time. You're going to be great. You're going to be a great saver. You got a head start by coming out of school with no debt. Mom did a great job. She's trained you well.

You're saving 65% of your income. I mean, you're just bright. Way to go. Way to go. Proud of you. I know she is. Well done. This is the Dave Ramsey Show. Why in the world would you trust some random guy in a cube when getting your mortgage?

Do you really think he cares about your long-term money goals? Well, he doesn't. Those companies care about getting you into whatever home loan program they're pushing that week. When it comes to ordering a cheeseburger, the meal deal works fine. But let's get real, people. We're talking about the largest investment you'll probably ever make, so don't be naive and trust an order taker who pressures you into a prepackaged loan. My friends at Churchill Mortgage have been helping my listeners for over 25 years. Call Churchill Mortgage and get custom solutions from an expert within 10 minutes. It's simple. They'll shoot straight with you and quickly show you the real way to save money.

Call 888-LOAN-200. That's 888-LOAN-200 or visit churchillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLSconsumeraccess.org. Equal housing lender 761 Old Hickory Boulevard. Redwood, Tennessee 37027. Thanks for joining us, America. We're glad you're here. Open phones at 888-825-5225. You jump in. We'll talk about your life and your money.

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That's why. And we prove it every day here with the way we treat our team, the way our team interacts with each other. It is an incredible environment. And so if you do any of those things, you're a senior level developer, those kinds of things, we've got about 234 positions on the board to hire in the next 12 months. And we'd love to have you join our team. Brandon's with us in Sacramento.

Hi, Brandon. Welcome to the Dave Ramsey Show. Hey, Dave. Hey, what's up? I was calling because I'm looking for some advice. So I'm almost 43. Just completed a Chapter 13 bankruptcy. I paid off almost $75,000.

I'm divorced. I'm single. And I have about $64,000 in school loans. And being in California, I'm a single dad, so I'm struggling, you know, whether I should save and purchase a home or just keep hammering the debt and pay off the school loans. You need to get the debt cleared before you buy a house, yeah. California doesn't change that scenario.

So you're in a Chapter 13 currently. No, I just completed it last month, actually. Okay, but remaining outside of that is $65,000 in loans. Yes, school loans. School loans, okay. And what's your income? I make about $120,000, a little over. loans, okay. And what's your income? I make about $120, a little over. Great, great.

Okay. So the trick here is to get on the written budget, the game plan. Make every dollar behave, every dollar scream because you're pinching it so tightly. And get that $65,000 cleaned up as soon as possible. And so let me give you a guideline. It ought to be 18 months or less with your income. Yeah, I mean, I have the EveryDollar app. You're not using it.

You know, there are some things I can, you know, kind of cut back on, but that's the problem because I'm in an apartment here in Sacramento, two-bedroom, and my son's 11, so, you know, I can't buy anything for less than maybe $1,700 a month. I don't have a car pay, but my car is paid for. You know, I usually have about $1,500 or so left after bills and everything, and I guess I can throw that at the school loans, but I don't know if that will get me there in 18 months.

Okay. You need to tighten this situation up. You've got to dial it in. Yeah, I'm going to have to go means and rights. Listen, the way the words you just used describe somebody that does a budget and tries to make it on what's left, that is not what the EveryDollar app is. You're supposed to give every dollar a name before the month begins and make those dollars fit, make that lifestyle fit.

You stay out of a restaurant. You do not have the money to go to a restaurant. You're broke. You're deeply in debt. You just came out of a Chapter 13. You make really good money. But $30,000 a year out of 140, dude, I mean, that puts you out of debt in two years. Come on. That's true. I mean mean you can't make thirty thousand dollars i mean that's so fifteen hundred needs to

become three thousand and then you're done in 18 months to two years and you cut your lifestyle to cause that to happen and you get on that budget and you tighten it up and pretend like i hired you to do that then like i hired you for $100,000 to straighten up a guy's budget. You could make his budget behave, so make your budget behave. That's what you've got to do here. Ryan's with us in Roanoke. Hi, Ryan. Welcome to the Dave Ramsey Show.

Thank you for having me on, Dave. Sure. How can I help? Currently, I have a 30-year mortgage with about 25 years left and i want to refinance to a 15-year mortgage i also was looking at a cash out option because i have a 15 000 loan uh that was for a wedding is this a good idea to bind it all together into a 15 year no you don't finance your wedding over the 15 years. You pay it off.

What's your household income? I make $42,000 and my wife makes about $12,000. Okay. So you have $54,000 household income with a $15,000 debt. Is that your only debt other than your home? We also have a car that is around $20,000 at the moment. We've already paid off $31,000. Oh, good.

How quick did you pay off $31,000? Nine months. Okay. You have $35,000 left. Why can't you do that in a year? If you did $31,000 in nine months, why can't you do $35,000 in 12? We're hoping for about two years on that. Okay, let me ask it again.

If you did $31,000 in nine months, why can you not do $35,000 in 12 months? I was hoping for that in two years, so that way we had a little money for... I'm going to ask it again. If you did $31,000 in nine months, I know what you're hoping for. I don't give a crap what you're hoping for. If you did $31,000 in nine months, why can you not do $35,000 in 12 months? I can do that. You can? Okay.

Yes. Okay. In other words, no, I would not stretch you staying in debt out, and no, I would not try to borrow my way out of debt by financing my wedding with my home. Let's just continue the track that you're on. You have a track record of winning on debt reduction. Let's just extend that track record out. One year, dude.

How old are you? 38. 38. 38. So the time you're 40, everything's paid off, and you're building your emergency fund, and it's less than two years. One year. And you're building your emergency fund, and then you're building up your down payment for your house, and you're done. Not your house, because you already got your house. I'm sorry.

Your house is on a 15-year fixed. So stay on the same plan that you've been on that allowed you to pay off $31,000 in nine months. Not sure how you did that on $54,000 income. So maybe you sold some stuff. I don't know what you did. Maybe you sell this car. I don't know. But it might not be 12.

It might be 18 months. But get yourself on a plan that is really, really tight and clears this debt up. And no, I would not try to borrow my way out of debt by doing a cash-out refi. The only time you do a cash-out refi is to avoid a bankruptcy, and I wouldn't do that. Michael is in New York City. Hey, Michael, how are you? Hey, Dave, how are you? Thanks for having me on. Sure, what's up?

So I'm 25 years old. I live in New York City, Manhattan, and I'm $83,000 in debt from student loans. Okay. My parents were very generous, and as soon as I graduated college, they were helping me out with the loan while I pursued my dream in Manhattan, New York. But lately, they've been having some trouble paying it, so I took on the loan to help relieve some of their stress. What is the dream? As I should, yes.

What is the dream? As I should take it on. What is the dream? The dream is to become an actor in Manhattan, New York here. Okay. All right. And how are you doing at that? I'm in the union right now, and I'm every day working as either stand-in on set, TV shows.

I do background on TV shows. How much money have you made? I make about $40,000 a year. Good. That's unusually good. If you can do that and wait tables, too, you can survive for a little while, and let's see if this dream hits, right? Right. You don't want to do that for 20 years, but for a few years,

and even if you just tread water on the debt for a little bit until you hit. Now, if you get a hit, obviously you pour all the money on the debt. Okay. Something happened that you doubled your income, but I think you can. I think that's what my parents were hoping. hoping yeah i think you can pay the minimum payments keep the dead alive without it dying and you eat and that's about all you're going to get done on 40 plus waiting tables right yes but that's that's what you do when you're living that dream we got the same thing here in nashville that's how you get the next country music star's attention in nashville

uh waiter and that's uh that's how it works you know so you just you get the next country music star's attention in Nashville. Waiter, and that's how it works. So you just work, buddy. You do that. That's not unusual in LA, New York, and Nashville. You work while you're working for the dream. And you work the side gig, the side hustle. No shame in that game. I would do it. Stay with it

for a little while, but just keep it maintained and as your income goes up, throw that at the debt. This is the Dave Ramsey Show. Hey guys, it's Blake Thompson, Chief Production Officer for The Dave Ramsey Show. This hour's up, but you'll find more on our YouTube channel, where we have over 6 million YouTube views each month. You can find debt-free screens, millionaire hour clips, Dave rants, and so much more. Go check it out.