The Ramsey Show - App - A Gift That Has Strings Attached Is Not a Gift! (Hour 1)

Episode Date: August 27, 2020

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Music Music 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. Rachel Cruz, Ramsey personality, number one bestselling author, and my daughter is my co-host today here on the air. We're taking your calls from all over America at 888-825-5225. That's 888-825-5225.

And I guess we're in the second week of the pre-order sales on your new book. Yes. Know Yourself, Know Your Money on pre-sale today, right now. So if you pre-order before January, you get the free e-book, free audio book, and a free video lesson. And, yeah, I'm so excited about it. Know Yourself, Know Your Money, all about discovering why you handle money the way you do and what to do about it. And it's just, I mean, I think it's been so crucial for me personally, just to have the self-awareness of understanding who I am and why I do the things I do. And when it relates to your money, it helps you win with money faster. It helps you in your

relationships. It helps you overcome fear. It just gives you this new level of understanding about yourself to really help you through this journey. Yeah. So it's kind of like, are you a nerd or are you a free spirit? Are you a spender or are you a saver? But on steroids. So you're going a lot deeper than that. Here's the eight types of fears that people face with money and which of those bother you, you know, and what type of family did you grow up in functionally as far as the money goes or dysfunctionally? And so how does that inform what you're doing now?

And the material is really, really strong. It's a great book. We do have the advanced copies in. So we've got our little copies in that we send to the press. They're called an ARC, an advanced reader copy. So it's paperback, of course, in that case but uh the book will be hardback it'll be out january the 5th and you can pre-order now and again you get 50 worth of items including the audio book the e-book and a video lesson from rachel if you pre-order now at daveramsey.com or rachelcruz.com and another

thing you may want to do uh it whether you order the book or whether you don't is you can take a free money quiz that we have are you a spender or a saver are you scarcity or abundance mindset and it'll walk you through and the quiz will really start to open up and give you a taste of what she's doing with this book and what this material is it's completely free all you've got to do is text the word money quiz to 33 789 money quiz to 33 789 and something like 30 000 people have already taken the quiz yeah i think 38 actually was the yeah last week so probably 40 something now yeah that was well it's and i think it's just it's one of those things it's just fascinating to understand who you are, and this quiz gives you a quick glimpse into that.

And it just gives you the language to be able to talk about it, too, to say, okay, this is who I am. And then you start to understand, oh, there's my spouse. And maybe that's why they're having a tough time getting on board, or maybe that's why every time I present this type of idea with money that they hate the idea because they are a totally different person. So it's been good to kind of have these realizations. The new book is Know Yourself, Know Your Money. Discover why you handle money the way you do and what to do about it.

It's on sale now at DaveRamsey.com. Tim is with us in Pittsburgh starting off this hour. Hi, Tim. Welcome to the show. How can we help? Hi, Dave. It's great to talk to you. I've been listening for about six months, and your advice is really, you really nail it, you know, almost all the time, and I'm just grateful to be talking to you. Well, you too, sir. How can we help? Thank you. I just retired back in March, and I had two houses. I sold one of them, and now I have a lump sum of money, and I want to know, should I invest that lump sum all as one unit,

or should I do dollar-cost averaging and kind of make payments into investments over time? Okay. I'm assuming your other home is paid for, right? Yes, correct. Okay. The biggest advantage of dollar-cost averaging is the emotional advantage, because as the market comes up or the market goes down, you don't feel like you've got all your chips slid to the middle of the table betting on one hand. But mathematically, if you just put it all in, you're going to end up making more money at the end of the day. And so dollar cost averaging comes into play really when you're doing your monthly investing over a long period of time. And if you're just uncomfortable or got

a little skittish about the stock market and you want to roll it in the emotional advantage of dollar cost averaging is there but the mathematical advantage is not because the market's going to go up a certain amount between if you put it all in today or you put it all in tomorrow versus six months from now you'll miss what it has done during that six months if you if you if you dribble it in you know so that that miss what it has done during that six months if you dribble it in. You know, so that's what it amounts to. And so, you know, but there is an advantage emotionally. And right now it's kind of weird out there. I mean, you retire in March, right?

The perfect month to retire. World's coming to a dead gum end, right? We're in the middle of a pandemic. And so folks are scared talking about what you were talking about in your book, Rachel, the fear factor when it comes to investing. Yeah, and people freeze up. Fear really paralyzes you. It narrows your brain.

I was talking to Marcus Buckingham about this on my show. And, I mean, it's amazing what fear can do to you. And, again, it doesn't take into any account any creativity. You can't think beyond it. It literally narrows your mind. And so I think that's what into any account any creativity. You can't think beyond it. It literally narrows your mind. And so I think that's what a lot of people experienced during the pandemic. Their minds were narrowed to this one thing and that fear dictated it. But as we have moved on through this and we've gotten more facts, we understand more of what's going on

and look at the market. You know, there's still a point that, I mean, I know you would say this too. You believe in the American economy enough to know that, like, over time it's still going to go up. Is it going to go up and down? Sure, it's a roller coaster. But over time, you're going to make that money. So, folks, those of you who don't know what Tim is speaking of, dollar cost averaging is meaning that what ends up happening is that you buy shares at this month, and then the market goes down.

You buy more shares with the same amount of shares at this month, and then the market goes down, you buy more shares with the same amount of money the next month, and then the next month it goes up a little bit. Well, those shares have all gone up then. And so you're buying some cheap shares when the market cycles, and you're buying some expensive shares when the market cycles. And the dollar cost averaging of that creates a very cool effect mathematically that causes you to end up with really good money, a really good return on your money. And you have the benefit of going, oh, when the market's down, I'm not panicked because I'm kind of excited. I'm actually buying shares. I'm buying into the mutual fund at that point. When the market's up, you're like, it's up. So my account looks really good, but I'm not buying as many shares. So you've got this

process that you use, and so investing professionals, investing advisors, and people like me have taught dollar cost averaging for years and shown the benefit of it, but when you reach the end of it 12 months later, 12 individual payments do not equal more than the return on the lump sum over the entire 12 months. Yeah. And so because you have not had the whole thing invested, that's what it amounts to. So good stuff. Good stuff. Thanks for calling in, Tim.

This is The Dave Ramsey Show. Most people's money problems come from not paying attention. That's why before I spend a dime of my money on something, I do the research and make sure it's going to live up to what it claims. Recently, I got a great pair of sunglasses from a company called Shady Rays. When you're looking for sunglasses, it feels like your options are limited. Name brand sunglasses cost too much and the cheap knockoffs are ugly and really don't protect your eyes. Discovering Shady Rays is a game changer. With Shady Rays, you can count on premium sunglasses that protect your eyes and are affordable. They give people the best overall value in sunglasses.

They also replace your shades with a brand new pair if you lose or break them from day one of your purchase. And they guarantee your sunglasses for life. Plus, they offer an exclusive for Ramsey Show listeners. Go to ShadyRays.com and use the code RAMSEY for 50% off two or more pairs. That's ShadyRays.com, code RAMSEY. joining me today on the air rachel cruz ramsey personality number one best-selling author we're in pre-sale on her new book know yourself know your money so ever since 1994 when i first started teaching financial peace university we have had volunteer coordinators. Back in the old days, it was a VHS tape put into the VCR, then a DVD, and then later, of course, we've streamed the lessons, and they're Rachel and me and Chris Hogan, Anthony O'Neill,

teaching the Financial Peace University lessons. And then a volunteer coordinator sets the class up at usually a local church. About 50,000 churches have now had a Financial Peace University class, and over 20,000-something people have been volunteer coordinators. At any given moment, there's anywhere from 5,000 to 15,000 volunteer coordinators running a class. And so this week, we decided we were going to pause for a second and just honor some of these coordinators. They have done absolutely incredible things, leading classes, and have had a front row seat for people transforming their lives. And so if you're a coordinator, you get to watch the people in your class transform.

Now, of course, everything went to virtual back in March, and all of our classes right now are the vast majority of our classes are virtual classes. But we wanted to jump on with a couple of coordinators, and we have done so this week. On the line are good friends of ours, John and Dorothy Bridges. Hey, guys, how are you? We're great. How are you?

Doing great. Doing great, man. Awesome. I didn't know I was going to get to talk to you today. That's an added bonus so very cool so you guys are out rving around the nation are you still coordinating we are we are yes we are we actually started the virtual before it was really necessary so uh we started doing virtual actually in 2019 doing a virtual class. It was great.

2018. Yeah, it made a lot of sense in your whole situation because you're moving around all the time, so that's perfect. So how long have you guys been coordinating classes? Well, we took the class ourselves in 2003, and right after we took the class uh realizing the difference it made in our life or was making in our life we started um coordinating fbu right after after we took the class so we've been doing it now for ever since 2003 so a long time and we

started on the 13 weekweek with the VHS. Yes, we did. Wow. So you guys started coordinating after you took it. So what made you just jump in and start coordinating then? Well, I think for me, it was such a huge relief. I think it was something that I had wanted in our marriage for a long time. John and I had

been married for 20 years. We just always seemed to live paycheck to paycheck. We had decent income, but we just couldn't get on the same page. And so when we took the class and just immediately started seeing the differences, I said, we need to share this. We have to share this. Very cool. So you started doing virtual classes back in 18. So you've done some through the pandemic here then? Yes. We just finished up this Tuesday night with one of the pastor classes. We're all pastors. Oh, that's cool. Okay. Yeah. We gave it to a bunch of pastors as a gift to say thanks for serving. And so that's perfect that you guys were the coordinators for one of those as well. So all those years, you guys have done just a bazillion of these things now,

and lots of people come through. Any particular stories of people coming through that stand out to you oh my gosh we have so many so many um everything from the single mom i'll never forget i think was the first class we led who was fleeing from a um a bad marriage and i mean literally fleeing from California to Alabama and you know came into our class with an infant and we immediately wrapped arms around her and just walked with her and we are still in contact with her today even 17 years later this infant now has grown up and graduated high school it's amazing but you know even in the virtual class, probably our most recent story that just sticks with me is a divorced lady that got introduced to you. She realized that her retirement dreams weren't going to come true.

She kept living the way she was living. And anyway, two years later now, as of last week, she just closed on the sale of her home and is preparing for retirement within the next year. And she's going to go move closer to her grandkids, which was her dream. And just to be able to see that come to fruition and to see how hard she has worked and just, you know, continued to stick with it. And we actually got the opportunity to meet her in Nashville last year. Oh, wow. That's cool. Very cool. Well, well done. So why should somebody that's listening think about coordinating a class? Why would they do it? Well, if they've gone through it already,

they'll know what a difference it makes in their lives, and it did for us. It is very easy. You guys have gotten with the new age of getting all the technology, getting everything in place to just make it a very simple process for someone wanting to do this. So it's not difficult. It's just follow the guides and follow the plans that are out there, and you'll do well. Yeah, and it's just to help, you know, well, when we started doing it, it was sort of on a selfish reason because it helped keep us accountable and helped us to stay on track. But when you get into it and you start seeing lives actually transform in front of you and you see people actually get it and they start getting excited about living and about their dreams, it's like, I can't,

I cannot just share this, you know. So we always said, even if we just had one person in our class get it, it was worth it. So yeah, that home run. Well, thank you guys so much. It's good to talk to you, my friends. I know, Dorothy, good to talk to you. Yeah. I miss seeing you.

But yeah, and I think that, you know know one of the powerful things is life was not meant to do things alone you're meant to do things in community with people and there's a power in that when you're around people doing the things that you're doing it motivates you and so it's one of those she said it but i know so many people that coordinate because they're going through it too and you can kind of you just create this community around you and the amount of motivation that comes out of that is tremendous. Well, that's right. We got 16 million people unemployed right now. And as a community, as a nation, we can give these folks hope. And so if you set up a class and you're, you know, run a virtual class this fall with us, if you want to do that and be a coordinator,

we will give you Ramsey Plus as a membership free for an entire year. And that gives you access to the EveryDollar where it's a budgeting app where it syncs up with your bank, syncs up with your spouse, it syncs up with everything, and, of course, all the content. Financial Peace University, one of them, but Rachel's put in several new lessons, Hogan's put in some new lessons that are bonus lessons that are available on budgeting and on investing and other things, in addition to Financial Peace University. The Smart Money, Smart Kids curriculum is in there, it's all there, it's all free to you if you coordinate a class virtually

in September. And we've got a lot of people wanting to go through these classes. So a lot of people need the help. So people need hope right now. Join this community of coordinators by texting to 33-789. That's text UNITY, all one word, to 33-789. And we will give you, again, Financial Peace, or rather Ramsey Plus, which encompasses all the things, as a free gift for an entire year. You'll have access to that. So it's like getting Netflix for an entire year free. Except

we don't have Tiger King. We're selling Sunset. Yeah. It's another great show. This is the Dave Ramsey Show. We'll see you next time. Families all over the country are discovering a faith-based and budget-friendly way of meeting health care costs, whether they're anticipated or completely unexpected. For example, take the Olcheski family from LaGrange, Texas. Jeff and Carice had just celebrated the birth of a new baby boy. Shortly after, they had another expensive medical issue come up.

They could have faced a huge financial setback. But thanks to Christian Healthcare Ministries, the Olcheskis were spared from a ton of medical bills. As members of CHM, they're part of a group of believers who financially and spiritually support each other. Thank you. visit chministries.org. That's chministries.org. CHM is a proud sponsor of Dave Ramsey Live Events. Thanks for joining us, America. Rachel Cruz, Ramsey personality, number one bestselling author, and my daughter is my co-host today here on the Dave Ramsey Show. Sarah is next in Albany, New York.

Hi, Sarah. What's up? Hi, Dave and Rachel. Thanks for taking my call today. Sure. How can I help? So my husband and I are on Baby Step 3B, and we have $23,000 saved towards a house down payment.

Wonderful. And we are looking at a house around $250,000. We haven't found one yet, but that's our ideal number. And my husband's parents have told us that they have money for us, and their words are, you can either have it now or after we die. So they have said to us, like, just give us a number, and we'll give you money towards a house. And my husband and I are feeling a little icky about it

because they gave us money for our wedding, and that didn't go so well that time around. What do you mean it didn't go well? They gave us money, and then they were upset when we didn't choose things that they didn't like at our wedding. Okay. How long have you been married? Three years. Okay.

So that's pretty new. I mean, relatively speaking, coming out of that event and having that, you know, it's like if it was 15 years ago, it'd probably be a different discussion, but it's just been three. So it's pretty recent. So I mean, I kind of see two options you guys have. The easy option would to say, you know what, it's not worth the relationship stress. It's not worth it. My husband, I mean, you guys have saved $23,000 for your down payment. You're almost at 10%. If you want a $250,000 house, like you guys are rocking it. Like you're doing great without their help. And so you could just keep on trekking and just saying, Hey, you know what?

You know, if they have an inheritance when they pass, that's great. That'll just be, you know, a blessing giving desk. So continue their legacy and that's it. So you can go that route and you guys would be 100% totally fine. If you went the route where you said, okay, maybe we do take a little now to help us kind of jumpstart the house process, you would just have to have extremely clear boundaries and lots of communication. And to the point that you're like, okay, you know what? This happened at the wedding.

Have you guys had a conversation about what happened with the wedding and the money? Definitely not. Because it got really awkward. Mom actually hung up on him because we didn't do something right with the wedding and the money? Definitely not, because it got really awkward. Mom actually hung up on him, because we didn't do something right with the flowers that she wanted, and it was the first time she had ever hung up on him. So it was a really weird situation, and it felt strange. Absolutely. Well, there's some dysfunction there.

I mean, that's a pretty big statement. And so I would say, if you guys go forward, you have to go back and revisit and say, hey, this is our experience with you guys, with the money. We were very thankful that you guys gave us this amount, but this conflict happened. It made us very uncomfortable. And so how can we assure that that's not going to happen again, that if we choose to use this money in a way that maybe you don't approve of the house we're going to buy, like, how is that going to make you guys feel?

We don't want to make you uncomfortable. We don't want to make you angry. So if it's easier for the relationship, maybe we just hold off. But I just see that lots of communication around these topics, you kind of just get the funk out of the air, talk about it. But then you guys have to know that, like, you cannot control their response. And how they choose to respond is up to them. And so my knee-jerk reaction, Sarah, if I was in your position,

it's probably just not worth it. And I'm like, you know what? I think we're going to be fine on our own doing our own thing instead of messing with it. Okay. Yeah. If you are going to go forward, I would, what Rachel said, I think it's your husband's job because it's his parents. There is a possibility that the house sits in a different place in his mom's emotions

than you stealing her baby boy. That was a thing. So in other words, she might not be as emotionally invested in the house deal as she was in the wedding deal. That's a possibility. So we could give her a little bit of grace in that regard. But I think he's got to sit down with his mom and dad. And probably maybe you're not even there. Or if you're there, you don't say a word.

That sounds good to me. And he needs to handle his parents. Because otherwise, you're going to end up, the narrative is you're the bad guy. Yeah. And we don't want you being the bad guy at the end of this. And it would just sound like, Mom and Dad, listen, I mean, Mom, you hung up on me over the flowers at the wedding and felt like you had the right to tell us how to do things at the wedding

because of the gift. If this gift for the home has that kind of a thing going, it's not worth it, and we don't want to do it. But if you can assure us that you will allow us to make our decisions about our house, and you'll enjoy our purchase with us, then we would love to accept the gift. But we can't, because I don't want you angry with me again if I buy a house that, you know, doesn't have enough trees to suit you or something. You know, I don't know. What the flip is she going to do?

Or a guest bedroom. Yeah. You don't like the guest bedroom. Because also the truth of just, like, the human condition is it wasn't the flowers, truly the flowers that set her off. It's truly not going to be the specific house. it's everything underneath that that's going on in her whether it's the control aspect whether it's you took her baby boy from like whatever it is there's that underlying thing that's under there that's kind of her issue yeah and so it's just to the point

of like okay do you want to do you want to face it and honestly money i talk about this in my book know yourself know your money the boundaries that you have to have in relationships with people whether it's friendships or in-laws or family whatever it is that those boundaries are so crucial because money makes things so strange and you choosing not to take the money is not you avoiding it i think it could be you guys being wise and just saying you know what there's other issues there that she has and more than likely it's a reflection of her and that may not have changed in three years. If you think that having that conversation will clear it up, then you can consider it. If you think there's a 50-50 chance that conversation clears it up or less, don't consider it.

Just walk away. Yeah, but you guys know more how things have been during the three years since and so forth than anybody else. Maybe she's just having a really bad week. You know, I don't know. But it's an emotional thing to go through a wedding for all parties involved, not just the bride. And so having done three weddings with three of our kids, I've experienced that as the dad.

And I've watched the various moms experience it different ways. And so in just the Ramsey house, anyway. So it's a process to go through emotionally. So, you know, just what do you think the probability is? If you think probability is high that this is going to be a repeat, then walk. If it's low and you think one conversation of clarity by your husband talking and you sitting and saying nothing while he talks would do it, then maybe you take the money. It's okay. But a gift that has strings attached is not a gift.

That's what it comes down to. Alexandra is with us in San Francisco. Hi, Alexandra. How are you? Good. How are you? Better than I deserve. What's up?

Yes. good how are you better than i deserve what's up um yes my husband and me entered four five and babysat four five and six um and with that we finally had decided to make some changes i.e his job um and he's joining the union out here for his trade which will be more money, more benefits paid. And the question we have is because they don't have a Roth IRA, they contribute $12 and some change to his pension every hour he works. And then they also put into a 401k, $6 an hour he works out from them themselves without us contributing anything. Anything. Okay, good. Yeah, and we have a private Roth IRAs right now, and his question he wanted to know was,

should he max out our Roth IRAs first and then contribute to the 401k that he can, or do the 401k and then the Roth? Match, you're getting the money from the union that you described, whether you put money in or not, correct? Correct. Okay. So there is no match then. If you put money in, are they going to give you yet more?

No. Okay. It's a set amount. Match is first, and you don't have a match. Second best is Roth. Third best is traditional. Mathematically, after taxes, when it's all said and done. Okay?

And so match is not there, so we're going to max out Roths, and then we'll go to the 401k and get to 15%. What they put into this has nothing to do with your baby step four. It's just a nice gravy on the biscuit. What you're putting in is 15% of your income into retirement. That's baby step four. You are putting in 15% so you're going to max out two Roths and you're probably going to do some into that 401k based on what you're telling me this is the dave ramsey show Rachel Cruz, Ramsey personality, number one best-selling author, and my daughter is my co-host today here on The Dave Ramsey Show. Our question of the day comes from Blinds.com. Find out for yourself why Blinds.com is the number

one online retailer of custom window coverings you get free samples free shipping and with the new promos that they run all the time you'll save even more use the promo code ramsey to get the best possible deal the question from blinds.com is my wife and I have gotten to the end of baby step four. Only debt is the house and saving 15%. We are hoping to have kids, but haven't yet until that is more of a certainty. Should we put extra cash into the mortgage? Or if we're hoping to have two kids, should we start putting cash away for college now? Murph from Connecticut. Uh, no, if you guys don't currently have kids continue on with the baby steps and then once you get pregnant then at that point you can say okay considering

your past baby step three then you can look to to open up a kid's college savings but I honestly wouldn't even really even do that till the kid's born right I mean at that point you have plenty of time so no continue to stockpile money away uh or I'm sorry put money towards the mortgage and pay off that house exactly it's exactly what you would do we don't save for kids college till there's kids and so um yeah and you'll need a social security number to open a college account a 529 or an esa and so obviously and so they have to be born to get the social so you just you got plenty of time you're not going to miss out you're going to be you're going to be okay and uh you know the more you chunk on that house the further along you're going to get on that and that's going to put you up in a position to do some really really

cool stuff then cole is with us in chandler arizona hi cole welcome to the dave ramsey show hey dave hey rachel thanks for taking my call today. Absolutely. What's up? Well, I'm getting married in about a year. And one year ago, my fiance and I thought it would be a good idea when money was tight for her to do her brother a favor and sign for a loan on a car. And the terms of that deal would be that he would get gap insurance. And then also that he would either pay the car off or transfer it to a loan in his name within a year. And, you know, he's been making the payments. He's not delinquent or anything, but we're here a year later and she still owns this car. So I'm wondering, how should I handle this, knowing that we're going to get married in a year? And, yeah, and there's a co-signed car out there with you guys, which eventually will be, you know, your name because it's Henry and she's going to be your wife. Well, have you guys asked him, have you talked to him about it, why he hasn't transferred it over to his name?

No, and I feel like that's where this leads, where we kind of have the confrontation discussion. We've just kind of made little remarks of, you know, my car looks really great out there or something like that. Sort of passive aggressive. Okay, yeah. So we're going to cut all that. And you guys just need to sit down adult to adult and say, hey, what's his name? What's the brother's name? Or you don't have to say that if you don't want to yeah well have your wife then it's her brother so she needs to lead the conversation and maybe it's just her and him talking you can be there if you want but she needs to have the conversation with him that hey we said that we were going to do this and i just need to know why and just talk to him have the conversation something may

come up out of that that you realize you say you know what maybe we'll give him a little bit of grace during this time here or there but i mean but the goal here is to get her name off of that of that car lease and so or that car loan um that's going to be that's going to be the ultimate goal yeah yeah you just gotta say this is what we said we to do. It doesn't appear we're doing it, so what's the problem? And what's it going to take to get this done? And obviously he hasn't done anything about it, or you would know about that. So it may take him a month to scratch around and do it, or two months or something. But that's better than just this going on in perpetuation forever and ever because you don't address it.

And that's also one reason you never co-sign. Even though he's not late on his payments, which is great, there's still this ownership. You guys are still attached, or she's still attached to this car in some way. And so that's it. It needs to be felt clear. And I'm not positive the way you described this, that she actually co-signed. It sounds like it's her car and her name is the way you described it and if it's her car in her name and her loan and he's supposed to buy the car from her for the loan balance at during that year that that's also a different transaction

than a co-sign it it sounds like she bought him a car and he's been driving a car that's in her name for this year and acting like it's his and paying the payments. And so she needs to get that out of her name because if he wrecks it, she's the one gets sued. She's the one. The driver can get sued and the owner can get sued. And so if he hurts somebody with that car, you could get a five million dollar lawsuit on you uh you know if it went above your insurer his insurance if he has the insurance in place so there's a lot of scary stuff here if it's more than just co-signing and is an actual ownership position you know when

you say well that's my car sitting out there in the driveway ha ha ha that makes me think it's titled to her rather than just she signed on the loan with him. So, yeah, this needs to be brought to a head. He either needs to get it done or, I mean, I'd give him maybe two or three months or something since you guys have not addressed it and you've just kind of stood there and looked at it. But you give him a little room, but, I mean, I've come and go, you've got three days, but within the next month or so, you come up with a deadline that you all three agree to and um you know i might even write that down and just initial it that well and i just even wondered having the conversation i mean it was like the call we took

on the other in the other segment about her and her in-laws and giving them money people naturally are just fearful and want to avoid conflict that's's like in the human spirit. People do not enjoy going in and having conflict. So it takes a level of maturity to say, you know what? I'm going to go head to head, have a tough conversation. Because just because something is hard doesn't mean that it's wrong. And so sitting down and having an uncomfortable, awkward, and you can even say that. Sometimes I do that. If there's like an awkward conflict, I'm like, okay, this is making me uncomfortable.

This conversation is not going to be fun. I'm going to just say it out loud. We're all not going to like it, but X, Y, and Z has to be said and have a conversation. I mean, that's it. I mean, it's, it's so key. And again, if you're not used to conflict, it's so uncomfortable, but it's so much better to clear the air and get out of it than doing all these passive aggressive statements. And that's with any of your relationships. So, I mean, sometimes it's not fun entering conflict, but it's the healthiest thing for the relationship and for you guys on the other end. Yep. Don is with us.

Don is in Chicago. Hey, Don, welcome to The Dave Ramsey Show. Hey, Dave. Thanks for taking my call. Sure. What's up? So, a question for you. So, I'm on baby step number two.

I should have that completed at the end of next month. And so my question really revolves around baby step three. My own estimation is it's going to take me probably till the end of February of 2021 to get to a six month emergency fund. That on itself. However, I do have a small brokerage account. So my question is, one, should I cash that out and apply that to help speed up the process? And then my other question is, in regards to 401k, do you stop making 401k contributions to get to your emergency fund? Yes. Yeah, we stop the 401k contributions until you're past baby step three, and then we restart them.

Because having an emergency fund and being debt-free, everything but the house, is just essential to being able to move ahead mathematically. And it's a temporary thing. The power of focus here is absolutely amazing. So, yeah, I would temporarily stop the 401k, liquidate the brokerage account, and then now you've got this brand-new goal as you finish up Baby Step 2, and that is to get your emergency fund in place.

Because, dude, when you have no payments but a house payment, and you have $15,000 or $20,000 or whatever your Baby Step 3 represents sitting in cash in the bank, and weird stuff like a pandemic hits, you're the little pig in the brick house, and the wolf is huffing and puffing and frustrated. You know, life comes at you and you have financial immunity. Yeah, absolutely.

That peace is, it really is. It's unbelievable. And again, I think some people, when they talk about money, they hear, you know, even you pausing the 401k, it makes some people be like, oh my gosh, what? But I'm going to lose so much ground. But again, it's just pausing it for a short period of time because getting that peace, getting that strong financial foundation under you of having no debt, having cash in the bank changes your perspective completely. And then you go back up and pick up that 401k. Yeah. It's so foundational emotionally, relationally, spiritually,

financially, mathematically, everything, to have those couple things done. And it really does put you in a completely different position than to invest long-term. That's why we do it. Because the reason I'm pushing on this art is it sounds weird to stop investing. That just sounds weird for people that love to invest, you know, like me. And so the nerd in you goes, no! But, man, I got to tell you, man,

pandemic will straighten yourself out on your theories, you know. This is The Dave Ramsey Show. This is James Childs, producer of The Dave Ramsey Show. On your smart speaker, you can add our skill by saying, Alexa, open the Ramsey Network skill. From there, you can listen to all our shows. Ask Dave money questions like, how do I invest my money? Or what is the debt snowball?

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