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Episode Date: June 1, 2022

Dave Ramsey & George Kamel discuss: The difference between a living will and a trust, What types of insurance you need (and don't need), Preparing to move out on your own. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

Live from the headquarters of Ramsey Solutions, it's the 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. This is the show where we help people build wealth, do work that they really love and that matters, and create actual amazing relationships. As opposed to fake Facebook friends. Yeah. We want you to have, like, real friends. Ones that will show up and help you change a tire and stuff. Yep.

George Campbell Ramsey, personality, host of the podcast, the Entree Leadership Podcast, which I just listened to, the one that dropped Monday, George. Oh, Ed Milet. Ed Milet. He was a great guest. He's a rock star, man. It was really good. Very well done.

Any of you need leadership information and business information, the Entree Leadership Podcast is one of the top podcasts in the world, one of the first ones to step into that space many, many years ago. Doing it before it was cool. It was a podcast before this was a podcast. Wow. This was just on the radio.'s impressive ahead of its time yeah we had we had it as a podcast before i could spell podcast so there you go okay open phones here we're going to talk to you about all of your life in other words that's what the ramsey show is about it's about the whole

thing the phone number is 888-825-5225. Jasmine's in Dallas, Texas. Hi, Jasmine. How are you? Hi, Dave. I'm fine. Thank you so much for taking my call. Sure. What's up?

I didn't mean to talk to you. Hi, George. A little bit. Use the baby steps. Whoa, slow down. You're going to have to get into your phone, girl. You're talking off in a distance. We can't hear you.

Speak directly into your phone. Can you hear me better? Can you hear me better now? A little bit. Let's try that. Okay. I used the Baby Steps to Get Out of Dead in 2017, Lifelong Listener, and now I'm doing estate planning,

and I wanted to know would it be better for myself and my family to have all my assets tied up in a will, a trust, or both? Just a will. All you need is a will. There's only a couple times you would use a trust. One is if you've got in excess of $20 million, you need to start talking about doing some estate planning that might involve a marital or an AB trust, it's talked about.

If you have a special needs child, sometimes you will have a trust formed at your death to take care of that. It's called a special needs trust. Money dumped into that trust to care for that child. If you have minor children, you can have a trust formed at your death at the direction of the will, but you wouldn't need to do it now. It would just be a family trust to take care of your kids until they reach 18. We had that set up when our kids were minors, and you can put all of that just in the will.

What you do need in addition to the will is you need a health care powers of attorney and a living will. A living will is the unplug or not unplug document. You go ahead and tell everybody what's going to happen so they don't have to go to court and argue about it. And the doc knows, and the husband knows, and everybody knows it's all written down. This is what Jasmine wants to have happen if she's comatose, or whatever the situation is. And you can lay all of that out, and everyone should. It's a gift to the rest of the family to not have to sit and go well I don't know

I believe this and I believe that and you know really what matters is what Jasmine believes in that situation yeah and Dave riddle me this I've heard people say that well with a revocable living trust you avoid probate and so it's worth it to get a trust for that reason

what are your thoughts on that? probate in most states is three percent and the revocable living trust will cost you more than three percent of your assets because most of the time they're fifteen hundred to three thousand dollars to put one together. And so a lot of the not a lot. Some of the people in the estate planning community have seen that as a way to make money. You make more money if you set up a trust versus help them get their will. Exactly. Exactly. You got to have will anyway. Either way, you've got to have a will, whether you have an irrevocable living trust or not. And there's a lot of problems with irrevocable living trusts.

I wouldn't fool with one. Matter of fact, my net worth is way in excess of $20 million. I don't have a living trust at all. Everything I have, let's see, I don't even have a trust. I've got a bunch of companies and LLCs that will. No, we do have one trust on one piece of property that's set up. It had to be set up that way. So one reason to do it is to protect some of your assets by sending them into the LLC or a business entity.

Exactly. And so, you know, but again, if you've got huge. So let's say you had $10 million. 3% would be um three hundred thousand dollars in taxes you might think if you had a ten million dollar asset and your state it's a state tax is a probate tax it's not federal you got no federal income no federal taxes on an estate of ten million dollars but if you're going to leave ten million dollars in a state that has a three percent probate tax, that's going to cost them $300,000.

Okay, so now you might, if it's all, let's say it's a $10 million piece of property. If you put that in an irrevocable living trust, it's a fairly singular transaction. It's easy to manage. It's not a big problem, not a lot of stuff going on uh and so forth uh but and that you know you'd spend three thousand dollars in legal fees and save 300 then that's fine you don't own the property more the trust now owns the property but you're the beneficial interest you're in control the trust so it's all the same thing the problem with the this thing though that and jasmine so you just need to go to like mama bear legal forms.com get your will done and do living will, which is a health care power attorney, and unplug or not unplug deal. That's simple.

Just do the basic documents for an estate plan, unless you have a sizable estate, and then you can start talking about that. But here's the thing, George. Let's go back into it, because let's just get down the nerd weeds a minute, the nerd weeds on this. This is my favorite place to be, the nerd weeds. We need a weed eater. So, okay, if let's say you had $10 million worth of assets and you didn't want to pay the $300,000, but it's like 25 or 30 different things, okay,

now you've got to retitle all of your mutual funds, all of your anything you want to hide from this probate tax, you have to reset the name on it, retitle your car, retitle your house. Nothing can be retitled. The family farm into the name of the trust. Anything that's not in the name of the trust is subject to probate tax. So what happens is I read an article in Financial Planning Magazine a couple years ago. 78% of the time, this is 8 out of 10 times, people spend $1,500 to $3,000, have this trust, which is basically a hollow thing.

You have to put things in the bucket. It's a bucket. You have to put things in the bucket. And then they never move the titles to the stuff into the bucket. So it's just an empty trust. So it's an empty shell. There's nothing in there. And so they still get all the taxes.

And so the reason i didn't start with that years ago i had a guy recommend it years ago was i got looking at it i went every time i saw a dadgum car i gotta go through a trust movement every time i saw a piece of real estate you gotta go through a trust movement screw it i'm just gonna you know no but now i do have a um this property right here which is worth i don't know 500 million dollars or something it's all sitting in one trust and that's for beneficiary for the probate aspect but also now all the gains on this property from the time above what we've put into it which it's appreciated right uh well no appreciate as it goes up value, generations don't pay taxes on it, estate taxes on it.

So it removed the whole thing except for the original cost from the estate tax equation. So huge move from that standpoint. Definitely worth it. But, again, it's one piece of property. I've got no hassle factor. I'm not having to move stuff in and out. I'm not having to work with trustees and lawyers every time I make some transaction. I'm not having to write checks out of a trust bank.

Oh, God, it drives me nuts. So, no, it's very, very impractical for 99% of the people out there. Don't screw with it. There we are. We're out of the Nerd Week. Thank you for taking us there. This is the Ramsey Show. Life has thrown a lot at us these past few years, hasn't it? You've weathered so much and you're still standing.

But it's taken a toll on many areas of our lives. Well, there's hope. Smart Conference is back and this fall we're bringing this world-class event to Dallas. You'll walk away empowered to grow in every area of your life. We'll be covering topics including personal development, building wealth, leadership, relationships, marriage, and your career. Joining me will be Rachel Cruz, Dr. John Deloney, Ken Coleman, George Camel, Christina Ellis, and Craig and Amy Groeschel. Smart Conference is an incredible day-long event that will give you the principles and tools to live the life you've always imagined.

Join us on October 22nd in Dallas for what will be the best Smart Conference ever. You don't want to miss this life-changing day, and check it out now so you don't miss out on our early bird pricing. Go to ramseysolutions.com slash events to learn more. Again, that's ramseysolutions.com slash events. So, Dave, we just celebrated Memorial Day, and coming up we have Independence Day, but there's another holiday that is one of my personal favorites, and that is National Insurance Awareness Day. I know you're a big fan.

We celebrate every year. We throw a big party. George, sarcasm will get you everywhere. I'm just saying. National Insurance Awareness Day is a real day. June 28th. Mark your calendars. June 28th.

We're throwing a party. Party! Oh, really? That's about as exciting as a Tupperware party. People don't know what that is, George. I'm that old. Yes, you are. Here's the thing. We talk about insurance a lot on this show, and we like to nerd out on it, but it's one of the most crucial things people need to get in place. And here's the bad news.

There's a lot of crappy types of insurance you don't need, some crazy types, and there's only a select few that are actually helpful as you build wealth to protect your assets. Absolutely. You know, the big thing we always teach in Financial Peace University and have taught for years is the thing you want to use insurance for is to cover things you can't afford. Okay, so if you're broke, you don't want to self-insure through a $5,000 car. You can't afford to lose that car.

You need to have it insured, right? If you got $500,000 in the bank and you're driving a ten thousand dollar car you could self-insure through that if you want to but insurance is for transferring the risk of things that you cannot handle the risk like the burning down of your house most people that would destroy their lives financially and so you got to transfer that risk And we've heard countless really sad stories on the show of people calling in with whether it's a house fire or someone died without term life insurance in place or they didn't have the right health insurance and they go bankrupt because of medical bills. And so it's one of the things that, yes, we like to have fun and make fun of the fact that insurance is boring,

but it's one of the most important things you need if you're going to follow the Ramsey Plan. You've got to have the right types of insurance in place. And one of the main types is home and auto. These are two of your biggest purchases you'll ever make, your biggest assets. You've got to have the right home and auto. A lot of people have auto, right? It's the law, but they may not have enough coverage inside of that policy. So that's one of the main areas you've got to look at and go, do I have enough to cover if I need this home insurance? Yeah, you're walking around with $100,000 worth of liability. You're a lawsuit looking for a place to happen. Somebody's going to sue you into bankruptcy if you get in a bad wreck. Because $100,000 won't cover 10 minutes in a hospital for the other guy that you hit accidentally. And it's called an accident for a reason. You

would never do it on purpose. But the guy's in the hospital. It's your fault. That family is going to come after you. And the insurance company is going to write a $100,000 check so fast, and it's going to leave you on the hook for the other half million in ICU bills, and you're bankrupt. You've got to have the coverages on the liability side. It's a big deal. That's a big one. And with that, there's umbrella insurance. We talk about this, and people go, do I need umbrella insurance? And this sits kind of on top of those home and auto policies to cover you in case of those lawsuits. And we tell people not to worry about umbrella insurance until you've built a certain level of wealth. You know, you've got a half million, million dollar net worth. Now you're a target. If something happens, go ahead and pick up a million dollar umbrella policy. If someone bumps into Dave

Ramsey in a fender bender, they're going, I just hit Dave Ramsey. Payday. Yeah. Ding, ding. Woo-hoo! Yeah. Don't try it, by the way. If you're driving behind Dave, don't just hit him for fun. Please don't do that. Well, you'd have to catch me. So, anyway, the thing is the umbrella policy is only a couple hundred bucks, usually $250, $300 for an extra million dollars worth of coverage.

It's a really good buy. Yeah. And we do recommend it. And the reason it's cheap is because you rarely have to use it. But when you do, you're really glad it's there once your coverage runs out on your current policy. So that's a good one to remember as you start building wealth. Another one, we just took a call about wills, but term life insurance alongside a will is so, so important if anyone relies on your income for term life and a will for everyone. Every single American needs a will. Yeah, 15 to 20 years

of level term, and the amount you would buy would be about 12 times your income. 10 to 12 times, we say, but 12 is good. So if you make $50,000 a year, you got $600,000 on you, you die, mom puts $600,000 into some mutual funds. It creates $50,000 to $, you got $600,000 on you, you die. Mom puts $600,000 into some mutual funds. It creates $50,000 to $70,000 worth of income. We have replaced the income that you used to create for your family. That's the purpose of life insurance. No thing else. All your investments ought to be in investments, not in life insurance.

Yes, don't trust anyone who wants you to get into whole life because it's a great investment on top of being life insurance. Terrible deal. You never do that. And 2021, here's a sad stat. 55% of Americans didn't have a will, which means family fights, which means the government and courts deciding what happens. I don't like that future for anyone. I've seen numbers higher than that.

I think it's a lot higher than that. But anyway, it's too many don't have a will. Too many. Another one is health insurance. And most people hopefully have this in place. I took a call last week where someone didn't have health insurance. And that's my A1. You need to get health insurance today.

And it's because medical debt has been the number one cause of bankruptcy in the U.S. It's so easy to bankrupt on. We just heard a team member story being in the hospital. Million dollar bill. Luckily, they had insurance, but that's the bill yeah yeah and the number one cause and it's not even necessarily the million dollar bill that bankrupts somebody it's you got no insurance i mean the co-pays alone can get you you know but you know healthy if you think okay what is the number one cause of bankruptcy medical bills the number one way of bankruptcy? Medical bills.

The number one way to get rid of that? Health insurance. It's a no-brainer. You've got to do it. And even if you don't have it through your employer, if you can get it in the marketplace, do it whatever way you can. You can get it. You can get Obamacare. I mean, it's out there. And, you know, a lot of states, Blue Cross Blue Shield or whatever.

But jump in there and get some health insurance. Go with an HSA. A lot of times that's going to be cheaper for you. At least get the big stuff covered so it doesn't bankrupt you. Yes. And if you're healthy, I love a good high-deductible health care plan with an HSA. That's what I do here at Ramsey. Me too.

And it's a great option. Alongside that, long-term care, something a lot of people don't have in place. We recommend getting this when you're 60 or older to cover nursing home stays, in-home care, things that can rack up really quickly. Yeah, $300,000 is your exposure on that typically, statistically, and that's about all you can get in coverage anyway. And so you get covered for about $300,000. And that keeps, if you're very wealthy and you got $5 or $10 million, you can self-insure. If you're completely dead dog broke, well well you're going to be on welfare anyway called

medicaid and the government's going to provide nursing home but if you're every everyone else who's in the middle between those two things and you're over 60 75 of you ladies will outlive your husbands and so what happens is papa goes in the nursing home they got 300 000 savings they end up spending it all on papa's care. He dies. Mama's left broke. And that's from not having good long-term care life insurance or long-term care insurance. Don't put life insurance in there. That's why it slipped out.

I was just going to remind you of that. They're starting to bundle it with some life insurance. Don't do that. Don't bundle it with savings. Simple nursing home or in-home care insurance. And it typically is going to cover around three years, four years worth of coverage is about all you can get. And $300,000 or $400,000 is what you're really at risk for. Yeah.

So for your 60th birthday, gift yourself the gift of long-term care. There you go. There you go. Long-term disability, another one, very different, but this provides an income for you and your family if you can't work. And this is something a lot of people don't have in place. It's one of the most underinsured areas because people just don't look at it that much. And really, one stat I saw said you're 12 times more likely to become disabled than to die by age 60. Wow.

And so if you're like 25. So disability is a bigger problem than death, in other words. Yeah. Plus, you've got to hang around with you. That's true. So there's a bigger problem than death, in other words. Yeah. Plus, you've got to hang around with you. That's true. So there's that part, too. So, you know, you need to get long-term disability. Don't bother with short-term disability. It's gimmick insurance. You're going to have your emergency fund in place. You've got that to cover you. You know, you're going to have a good plan. You're going to be working the Ramsey plan, all that kind of stuff.

But long-term disability, if you can get it through work or through a group plan of some kind, is by far the cheapest. Yeah. And that's what we have here at Ramsey. It's covered. Thank you, Dave. We provide it. Because honestly, it's not that expensive as a benefit for an employer to provide.

If you're a small business person, it's something you can actually buy for your team unless you're in a blue collar trade, which the trade you're in will affect your disability insurance more than your age or even your health. Makes sense. So if you're working with your hands and you're swinging three tons of I-beams around, harder to get coverage on long-term disability than it is if you're flying a desk job. Yeah. Well, the last one's identity theft protection.

Not quite an insurance, but very important to have in place as more and more people are shopping online. I've experienced this. Luckily, we have Zander's ID theft protection for our whole team. They helped me avoid a 600-hour mess. So here's the deal. We threw a lot at you. We just launched a five-day series, an interactive guide. I'm going to walk you through this stuff in less than three minutes a day. You can go sign up for this at ramsaysolutions.com slash confidence. I promise it's the for this at ramseysolutions.com slash confidence. I promise it's the most exciting insurance video series ever created. Which is a low bar. So low.

It's a low bar. I jumped over it. So go sign up. ramseysolutions.com slash confidence. You'll thank me later. It's called Confidence in Your Coverage. And all joking aside, it's really good. George has done a great job with this.

Five-day interactive guide. Confidence in Your Coverage. coverage go watch it it's free George Campbell Ramsey personality is my co-host today. Thank you for joining us, America. Open phones at 888-825-5225. Maurice and Z are with us in Phoenix, Arizona. Says on my screen, you guys are debt-free. Congratulations. Yes, Dave. What's going on, man?

Thank you. It's good to hear from you all. You too. Congratulations. How much have you paid off? We paid off $62,000, Dave, in 10 months. Good for you. And your range of income during that time?

It was $135,000, Dave. Oh, I love it. Good for you. So what kind of debt was the 62? So the debt consisted of, it was three grand from the IRS, and then also $59,000 from Navient. We kicked Navient out the basement. Get rid of ugly Uncle Navient. I love it.

That's right. Yeah, he's a brother to Sally Mae. Brother and sister of ugly. They might be kissing cousins. They're brother and sister of ugly. I love it. You guys are awesome man congratulations what made you decide to do this uh 10 months ago honestly dave i got put

on to you in 2017 from our cousin ashley and she gave me the total money makeover and so i read that and then i also um was able to hear one of your, you was talking about how to become an everyday millionaire on YouTube. And so after hearing that, I was just sold because, you know, where I'm from, we only talk about, you know, becoming a millionaire. You have to, you know, play a professional sport or just, you know, blow up and be famous. So after I heard that, you know, regular people can do it, I was just sold. And then I put my then, you know, girlfriend Z on to you back then in 2017. Yeah. And so back then, I only had a car payment.

That's pretty much the only debt that I ever carried. And I was living with my parents and I wanted to move out. And so I was like, I read your total money makeover. And I was like, wow, I literally could just pay off my car payment. I live in rent-free. I don't really have bills. Why am I sitting on this? So I paid my car off fairly quickly and moved out on my own, and the rest is history.

Wow. All right. How long have you all been married? We've been married for a year and four months, Dave. Okay. So when you get married, you decide, all right, we're really doing this. Whatever debt is left, we've got to clean up, and it's old Uncle Navient. Yes, Dave.

And unfortunately, you know, I brought the debt into the marriage. So when we got married, we cash flowed our wedding. That consisted of $20,000. And then we hit the ground running, Dave, just, you know, working extra jobs. I remember working, you know, six, seven days a week sometimes. Z was also putting in extra work as well. And delaying, you know, that gratification, right, and just not going on vacation, you know, telling friends no,

you know, when we wanted to go out. And we were just locked in and had the tunnel vision days wow what was the highest paying side job you guys did i would say the highest paying side job i did was officiating youth football on the weekend oh nice pretty good money doing that yeah it was fun man what's that pay it pays uh fifty dollars a game day so i would do anywhere from four to five or sometimes six games a saturday oh wow that can add up crushing it that's good so you guys saw what was on the other side of debt freedom and that excited you absolutely and you were willing to do whatever it took to get there in 10 months and we're not talking about you know eight years of sacrificing

and not living and doing these side jobs for 10 months you can do just about anything yeah but i gotta go back maurice i'm there's probably a story i'm troubled by i don't understand you started in 2017 but you didn't really start well i started uh by uh i paid off my car so that was like one of the biggest things but um so yeah i think i think though what what I'm saying is when Z came into the equation, you got with it. Oh, absolutely. I kicked it into high gear for sure. That's what the calendar tells me. About the time she showed up, we got rid of Uncle Navient.

Right, exactly. It was a lot of theory until Z, and Z's kicking it in gear now. Am I missing something? Yeah. No, I'm definitely a numbers person, and so in order to come into this marriage, Marie's new, like, okay, we actually have to have a plan. We have to get this done. Yeah.

And there's no way that this is just going to linger around in our marriage. So, yep. Marie's take notes on this, because next time you bring something up, she's going to make you do our marriage. So, yep. Now, Maurice, take notes on this, because next time you bring something up, she's going to make you do it. Okay? I'm just saying. I like it. This is good.

Y'all are awesome. You're fun. Way to go. I'm so proud of you. How does it feel to be free? Man, it feels great, Dave, just to be able to, you know, once the bills are covered, just to look at the budget and just see all that extra freedom that we can do.

You know, we're, you know, right now, you know, saving for a home right now. So that's exciting. So it just feels amazing. It gives a better sense of peace, you know, going to bed at night. And then also, too, it relieved a lot of tension within our marriage as well. Yeah. You know, I do love what you said earlier maurice when you said um because you're like me you said i came from a neighborhood where we thought the only way to you know be

wealthy was to be famous or something and i'll be an athlete or somehow become famous and uh when you actually understand the numbers and you start to go hey if guys that come from neighborhood like maurice or dave can do, anybody can do this, right? And that's a good message for everybody to hear. Absolutely, Dave. Absolutely. Yep, absolutely. Because, you know, just like you said, Dave, you know, where I'm from,

you know, this is what you see, you know, just people going to the NFL or NBA, but people don't talk about the grind. Just living under your means, right? Living debt-free, and that provides a lot of freedom in your life. So, yes, that's absolutely correct. Well, proud of you guys again. So awesome. Who were your biggest cheerleaders outside the two of you?

Who was saying, go for it, you can do it? Yeah, we had a ton of family and friends who knew about us being on this journey, and they would cheer us on. But I have my best friend, Sydney, who you all got to speak with her a couple of months ago. She called in and did her debt-free screen from Phoenix as well. I remember we started our journey together at the beginning and we actually finished around the same time. I remember calling, you know, after a long day at work and things of that matter and we would call each other and just talk about like what the first thing we were going to buy when we were debt free what we were going to do and so it just um it was really nice just having her along this journey with us we kind of were a trio here that's cool that's very good yeah well we got a

copy of baby steps millionaires for you that's the next chapter in your story for sure you guys are on your way maurice you're going to be next chapter in your story for sure. You guys are on your way, Maurice. You're going to be a Baby Steps Millionaire, man. I want to talk to you on that hour when we're doing that hour one of these days, and I'll remember talking to you today when that happens. And also I'll send you a copy of Total Money Makeover, which you can hand out to someone and get them started.

That's what got you started. I'm also going to send you a one-year subscription to Financial Peace and every dollar through Ramsey Plus. And if you've not been through it, you guys go through it as a wedding gift. If you have been through it and you want to give it away to somebody and get them started, a lot of people

buy these one-year subscriptions and give them away. So whatever you want to do, we're going to send it to you either way. And we're just proud of you guys. Way to go. Amazing. Thank you so much, Dave. We appreciate it, man. You bet. Maurice and Zee, Phoenix, Arizona, $62,000 in 10 months, making $135,000.

Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! I love it! That's how it's done right there, man. You don't need to wait on student loan forgiveness.

You can just kick Uncle Navi and out yourself. It's more enjoyable that way. And he's the bothersome old uncle. You know, not the cool uncle. He's a little creepy. He's the creepy uncle. He's always little creepy. He's the creepy uncle. He's always hanging around. He's in the bedroom, won't leave.

He just sleeps all the time. Asking for money every month. What a bum. He wants money all the time. He's always standing around with his hand out. That's so true. And he learned it from his cousin, Sally. That's right.

And they're just... Everybody's got relatives, one or two like that, that you just don't want living with you. No. Uncle Navient and Sally, they got to go, people. They got to go. They get their own place. And let me just tell you, Uncle Joe's not going to get rid of them. Try as he might.

He's going to talk about it, but he's an enabler. That's a good way to put it. Never heard it said that way. In so many ways. This is The Ramsey Show. Thank you. Imagine the energy of a jam-packed arena filled with people ready to experience what it means to live life to the fullest. Picture that with your favorite speakers on one stage, empowering you with tools and principles that will create unstoppable momentum in your life. That is one of our live events. That is Smart Conference.

We just came back from 3,000 folks, business leaders a Thursday night there in Orlando for a Building Wealth Live event with George and me and Rachel and Dr. John Deloney. And who else was there? Ken Coleman was there. Yeah. So the Smart Conference is an expanded version of everything. It is leadership. It's wealth. It's achieving your goals.

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Pretty cool. And you don't want to miss this. Tickets are only $39. That's a great price for a full-day event like this. It is about 50% sold out. It is going to be in Dallas, and it'll be October the 22nd, all day that Saturday. Go ahead and get your tickets now before they get sold out. If you haven't noticed anything that is a live event people are gravitating to like never before,

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That's how it works. All right. Matt is with us in New York City. Hey, Matt, how are you? Hey, Dave, how are you? Better than I deserve. What's up? Nothing much.

So I have a couple questions regarding my finances. So I'm 22 years old. I'm currently serving in the United States Air Force and the Air National Guard. And I'm about $6 living with right now looking to move out of their house in about two to uh you know three to four years and get my own place down in Florida but I do not have any sort of uh discipline whatsoever when it comes to saving money and budgeting okay hard stop hard stop I gotta catch up here you're in in the Army National Guard, did you say? Air National Guard. Air National Guard. Okay. And you're how old?

I'm 22. And that's a part-time gig or a full-time gig? That's a part-time gig. Okay. What's your full-time job? Yes, sir. What is your full-time job? I'm a private investigator okay and you're the national guard is typically done

state by state is it not can you transfer to florida yes i can okay but you went through a boot camper regiment to to join right yes sir and they taught you discipline right um sort of we were i went to boot camp um amidst this covid um so it was it was really um you know sort of shorthanded but the boot camps and discipline and what they can do and what they can't do and everything like that. Gotcha. It was the shorter version. So what do you make as a private investigator? Your phone is screwed up.

You need to speak directly into it. Can you hear me? Yes, sir. That's better. Thank you. Thank you. So I work about 50 to 55 hours weekly um the pay is 1850 an hour and so why does it take three years to move to florida

just say just saving up money um you know as far as you make plenty of money you must be partying your butt off yeah matt where's the money going currently? Do you know? Really have no say with that. I really don't know. I think it's more so my problem of going out during the week and not budgeting and not saving my money. Yeah, every night. Yeah. Well, it sounds like there's your problem and there's your solution. Yeah, every night. hang out. They can come to my place. I'll go to their place. We're going to do this on the cheap because I got goals. I'm going to get out of this $6,000 in debt. I'm going to have an emergency

fund. So I don't have to worry about getting that next paycheck if it doesn't show up. And then we're going to go about the business of saving up to get out of that house. And I don't think you need to be buying a house right now. Go rent somewhere, even if you move to Florida for a while. Yeah. I mean, I think you could could be debt free move out everything within just a few months here but you're going to have to really make every dollar that you have behave and so here's a rule i always use matt um you can't out earn your stupidity i tried you can't make enough to not know where the money's going. No one can make that much. That's how people that make $10 million as an athlete look up a few years later and they're broke.

And they say the same thing you said and the same thing I used to say. I don't know where it went. I don't know where it went. And so you don't want to wake up that way at 30 years old, man. You're calling at 22. The great news is you're only 22. And so it's time to get with it um time to throw your shoulders back and be a grown-up and stuff and uh that means you're

going to tell you i want you to pretend like you're managing this money for someone else and it's your job to manage the money well and if you don't manage the money well you're going to get fired because you suck at your job pretend that and that helped me because as a as a christian i started going this isn't my money it's god's and i suck at managing god's money and then i want him to give me more to which he laughs and says no you suck at handling my money it's in the bible i like picturing that yeah is that second opinions that's where that one came from no it's in the parable of the talents actually oh yeah yeah when you when you don't manage well he not only doesn't give you more he takes it from you

and gives it to the one who does manage well it's in the bible and so yeah and that that's the thing i always tell audiences uh matt, and I'll tell you, pretend like you were managing money for a company called you incorporated and your job was to manage money for you incorporated. That's your job. Now be good at your job. As soon as you do that, you're going to find you got money everywhere. And you're going to be looking at your party bubbles andba's and saying nope nope nope nope nope no 22 there's lots of bigger goals than drinking beer all night

got bigger goals smoking dope all night i got bigger goals in this we've got stuff to do here we're gonna uh like be a grown-up pay off our debt move out of the house go to florida got bigger goals you want to live a grown-up life you got to do grown-up stuff and you know i mean i meet 62 year old children and i meet 22 year old grown-ups so it's not an age thing it's just a matter of the one definition of maturity is learning to delay pleasure for a greater good and so am i willing to pay a price for something better? Am I willing? No discipline seems pleasant at the time, but it yields a harvest of righteousness. The way we say it around here is that way. And we also say live like no one else so that later you can live and give like no one else. But that requires having a vision for your life.

There you go. Where there is no vision, the people perish. And so you've got to have those goals in front of you or else you won't have any real reason to manage your money well it honestly it is easier to overeat over drink and be broke except for the part when you wake up it's fun for a little and you're fat and hung over and broke i mean you know it's a problem and so you know it's easier in the moment you know but but it's easier in the moment, but it's easier in the long term. Because here's the thing. A guy I used to work for used to tell me this all the time.

He said, you're going to pay a price. You're either going to pay a price now so you win, or you're going to pay the price of not having paid a price and live a life of mediocrity, and the life of mediocrity is the price you pay for being a half-butt. And he would look at me and go, Dave, don't be a half-butt. Which I never really figured out exactly what a half-butt is.

But I just didn't want to... Is full-butt the goal then? Well, apparently I am, but there you go. Shut up, George. I'm here for your entertainment, America. That's all. This is The Ramsey Show. Do you love a good day, Brandt?

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