The Ramsey Show - App - Budgeting Leads You out of Debt & Into Wealth

Episode Date: April 29, 2025

Live from the headquarters of Ramsey Solutions,'s the Ramsey Show where we help people build wealth, do work that they love and create actual amazing relationships. I'm Dave Ramsey your host Rachel Cruz Ramsey personality number one bestselling author host of the Rachel Cruz show and co-host of Smart Money Happy Hour on the Ramsey Networks and my daughter she's my co-host today. Open phones here at triple eight eight two five five two two five. Before we dive into the callers I've got to do a correction that I screwed up on. I do this ever so often I've been doing talk radio 15 hours a week for and podcast type stuff for yeah 34 years now and so you can add up that

number of hours and in that number of hours I have done some stupid butt stuff in my life but it's you can't take it back it goes over the airwaves it's gone this was not on this show my friend Sean Ryan has one of the top podcasts in the world and is here in our community and was nice enough to have me as a guest on and we did a long form interview there. I think it's like three hours and 43 minutes which is more Dave than anybody should get

but you can get it if you want to. Go listen to Sean Ryan. And it was very popular. We've had, he's had, it's one of his top shows. I was talking to him last night about it as a matter of fact and it's one of the, the numbers on it are absolutely astronomical. And then I get a letter that I had messed up something on the thing oh no and 99% of the time when I get a letter like that I

just look at it yeah throw it away but this one I screwed up oh I can't wait to hear this is great yeah so I got I got fired when I was 22 years old and I tell the story often and I very seldom if ever tell the name of the company but I told the name of the company okay that I got fired from mr. transmission and the and I don't know why I got fired the guy yelled at me and I've heard that story yeah threw me out of the building and all this stuff and so it's one of the ways that we decided at Ramsey no one's ever surprised if you get fired here you will at least know why you, because I still don't know why.

And it was 40 years ago, you know, so I was 22 years old. 42 years ago, I was 22 years old. So I probably deserved it. I just don't know why. And but the guy- Did someone from the company? And I was telling the story about that. And I said, well, I said, it was a,

it was called Mr. Transmission and they're out of business now. And there's, I think there's a couple of them left open but the franchises all closed down. Well, that was wrong. They did go bankrupt in 1990 because I actually looked at buying it at one point and They went bankrupt in 1990 and another company bought them out of bankruptcy. Okay, and now they're a thriving franchise operation Okay, okay, and they are still alive and kicking. They're more than alive and kicking. They're doing great. But you said like... I said they're out of business and so the lady that Barbara,

that is the president of the company that owns it, sent me a letter. Very nice, very nice. But she quoted exactly what I said in there and she said, just want to let you know we're alive and well and we don't treat people like that now under our regime. I'm like, dude, it was 42 years ago. Of course you don't. And so I called her and talked to was 42 years ago. Of course you don't. And so I called her and talked to her and told her I would come on the air and tell everybody that I was wrong. How great that company's doing great.

Mr. Transmission's just doing great. And apparently they're great people. She's a very nice lady. Very nice. I appreciate that. There it is. I straightened up my mess that I made on Sean Ryan's show because I bankrupted a company that was still operating. I still don't know why you're fired from 40. That doesn't matter. That's just a funny story. No I know.

And if I'd have just been smart enough to not even mention the company name, everybody would be okay. That's always a feeling. But instead I bankrupted a company that's doing really well. So they're doing great. And they're good people. I talked to her a long time. We had a great conversation. She's sweet as she could be. And very kind considering I had stepped all over her stuff.

Not everybody's kind when you do that. So it's good stuff. So open phones here, triple eight, eight two five, five two two five. And man, that's something else. So open phones here, 888-825-5225. And phew, man, that's something else. All right, so I'm gonna do this. The money and relationships tour, Dr. John Delaney and I have not gotten fired from that.

It is going very well. It might be bankrupt depending on what happens on stage. It's not bankrupted at all. It's actually booming and the Kansas City sold out for Friday, May the 9th. A week from this Friday will be in Kansas City. A week from yesterday will be in Phoenix on May the 5th. Fort Worth on May the 7th. Few tickets left in Fort Worth.

A handful in Phoenix. Kansas City gone, okay? So if you want tickets to come out next week, you bet one of those three cities, you need to get them because they're, these are all gonna be packed. They're gonna be packed out. And Dr. John is on fire.

This is his, he, when he can just free flow and not have to follow a script is his favorite thing in life. So, and he's really good at it. And so it's fun and funny and we're having a good time on stage being up there together at the same time. It's a weird way we're doing it it's not a normal talk yeah so the

audience votes on the subjects now y'all done three cities already are the audience what they want similar city to city or is it been very different remarkably similar okay what are they wanting we're not gonna tell because they I don't want to skew the voting at the next city make sure you get the polls aren't closed all right you can't tell who's winning yet. Okay, okay. But it's yeah they're picking out similar topics. Yeah and they're to be once you look once you see them you go oh I get that. Yeah. I get why they're yeah. Okay. And so yeah and they're but they're you vote before we start and while you're sitting in the audience with a QR code and then we're, scrambling around looking at the votes,

and then we make up the night, or Grayson actually helps, the guy that runs the content, he makes up the night and then brings us a sheet out, and then we talk about those topics. So fun, it's great. And so, it's very off the cuff in that sense, and a lot of fun. So if you want tickets, ramsysolutions.com slash tour, ramsysolutions.com slash tour,

and if you're tuning in on the YouTube or podcast, you can click the link in the show notes. You don't have to be trapped in the same patterns of money or relationships. I will guarantee you this, if your spouse is or your best friend thinks that the stuff we teach is boring, they can come out and they'll find out it's a lot of fun, because we laugh and laugh and laugh and laugh. And you guys do the same thing when you and John are up there doing the marriage and money retreat, right?

Yes, yeah. And a little different content, obviously, but you two on stage are a hoot, you're both dead gum comedians. So a lot of fun. So you can get in and get that done. So all right, what are we gonna talk about for a minute? Love it. Well, I was gonna say, because I think,

well, I was talking to John about these events, but he was talking about how thematically, how similar things are and what the problems people have continue to be pretty consistent regardless of where you are in the country, regardless of family of origin. But these ideas that people, they want the ability to have great relationships.

They want the ability to take control of their money. They wanna build wealth and they wanna be able to, yeah, I mean, I think build a life that they love. And so I think that's what's so great about all of this though is being able to hit. You see the commonality of it. Yeah, and the pain points that are really out there. And we see that theme on this show.

Like we'll get calls four in a row of people that their spouses can't, they can't work together with their spouse. Or we'll get four calls in a row where it's like crazy student loan debt, right? Like we see themes even on this show. So I think it's just encouragement to people out there, like whatever that pain point is, we see a consistency in it. And that's why we do what we do, whether it's on this show, whether it's going out to cities

and doing events like this Money in Relationship Tour or other shows we have on the Ramsey Network. But that pain point that you have- It turns out the human condition is just the human condition. It is, yeah. And it doesn't make you, you know. It is the condition we're in. Yeah, you're not weird in that way. Like there is something so normal, what we're all craving. And I think you guys are seeing that with the content

on this where you have an audience that votes, which I think is awesome. I think it's beautiful. And that's why we're here. This is why we do what we do. It's a great way to build a set list for sure. This is the Ramsey Show. This is the Ramsey Show.

Jenny is in Atlanta. Hi Jenny, welcome to the Ramsey Show. Hi, thank you for having me. My question is, my boyfriend doesn't want to work and is that a deal breaker? I'm a 40 year old surgeon and my first job, last year I made about $280,000. This year I'm expected to make close to $500,000 in the second year of my work. My boyfriend of one year is an actor.

And the entire time I've known him for about a year, he's had two days of work as an actor, and he made less than $23,000 last year. So he didn't qualify for the Actors Union health insurance but we want to continue our relationship and keep moving forward and eventually get married and live together but he says that because the house will be under my name as the main wage earner. He doesn't feel like he should pay for any part of the mortgage. He also can't. And I'm wondering if that's the deal breaker or if I should just fuck it up and pay for

the expenses because I can. What do you think, Jenny? Is that attractive to you? Like, are you like, what a winner? This is not how I had imagined being in a relationship. You're smart, you're a surgeon, Jenny. You're really smart, you know? So I'm just, it is interesting,

because usually, not always, but to a degree, people's intellect, you're attracted to other people's intellect, and you're a hard worker. Obviously, the schooling you had to go through was insane in the amount of hours you have to put in and work and to have somebody that doesn't give. And again, I'm not mad that he doesn't have a job

as an actor every week, but at least he's like, hey, I'm still busting my butt and I'm part-time here, I'm waiting tables here, and I'm trying to make this dream work. I'm not mad at the dream, but the fact that there's nothing in between that that's happening, right, is like that's as a woman who works and all of it, like that's not attractive to me

as a, for a man, a guy that has a level of initiative, I find attractive. So I'm just curious if yeah, if that's how you feel, or if you're great with it, and you might be great with it. You're asking the question, she's not great with it. She's asking the question. The reason you're asking the question

is you're not great with it. Again, this is not how I had imagined being in a relationship with him. I feel like me being the provider because even though I can provide for myself, I thought our relationship or partnership would be a partnership where I would be... I don't care if he makes as much money. I care that he doesn't work. Or that again, if he wants to dig ditches, I don't care, as long as he's doing it all day every day.

I've asked him how he can get by without working and he says he has some residuals coming in from prior work that he's done as an actor, but clearly it's not enough because he didn't... Clearly he sits on his butt. Regardless of why or how, he clearly is an unmotivated slug. Um, clearly. He's 51. He's 51 and um, I'm not sure how much things are gonna... Jenny, you don't have kids, do you? No, he doesn't. If you had a daughter that asked you this question, what would you tell her? I would probably say, can't you find a better guy? Yeah, that's exactly it. So here's what's happening. You already have made this decision. You just wanted someone else to say it out loud. And I'll tell you, if you go forward with this guy, you're gonna get increasingly resentful

and increasingly bitter. This is not gonna get better. You're not suddenly gonna have peace with this. You don't have peace with it now That's why you asked the question and as a reminder, it's not a value of what he's bringing monetarily necessarily It's the effort Jenny. So yeah, so if you guys have kit, yeah, if you get married you guys have kids Who he is with his work is the amount of energy is gonna put into that, you know I mean every your marriage if your marriage starts to be in a hard spot The amount of effort that he's putting into his life is what you're going to see there.

So it's just an indicator of his level of pursuit in life in general starts to kind of show. So, yeah, he's cute, but the cute's already worn off. So basically, it doesn't matter how much money I make and whether we can support ourselves with my money. It's a matter of his. It's a matter of his- It's a matter of he has no work ethic, which is a character issue. And let's say this, it's 2025. There's some stay at home dads, right?

Sometimes the woman is the breadwinner and roles have reversed. So even if that was the case and he's like, hey, we're having to support kids and you have a demanding job, I'm able to do this and this and this and figure, you know what I mean? But there's like effort involved. It's, but there's none of that. This is just, I'm able to do this and this and this and figure, you don't even mean, but there's like effort involved. It's,

there's none of that. It's just, I'm going to sit on a log. I know. And it's hard cause you like them, right? I mean, I'm sorry. Yes. It's the answer. Your question is yes. We think it's a deal breaker and so do you. And you just wanted someone else to say it out loud. Did I miss that? You're right. Thank you for being a mirror to say it out loud. Did I miss that? You're right. Thank you for being a mirror that I needed to see. Sorry.

Oh, bless your heart. That's hard. It's hard. But yeah, it's, cause your emotions cloud when you're falling in love. And so you tend to put blinders on, but this got pushed far enough, one too many times it came up.

And the fact he wants to take no responsibility for anything. Did you hear that? Put the house in your name and you pay the mortgage because you make the money. And I'm like, oh golly, man. You know, like all of it. It's just, yeah. Yeah, because I have residuals I

have a residual PTSD just from thinking about it all right Tim is in Toronto hi Tim what's up hi there I'm 21 I just finished college last week congratulations what's your degree in thank, I'm a social service community worker. Okay. And I've been working while I was in school to try to put together kind of out of the box this idea, but I'm kind of working on a time limit with a vision disability, so I'm kind of wondering if I should go through financing and pay it off as quick as I can within five years, or if there's other avenues I can take to kind of fit a shorter timeline. Tell me what your vision disability

timeline issue is. So I have something called a retinal dystrophy which continues to get worse over time. I have about 60% of my vision currently but I have about less than 10 years before it's to the point where I won't be able to work anymore. Well you won't be able to work with sight. Correct. Lots of lots of people that don't have sight work. Correct I would just need more help with the local organizations which I do have connections to but yeah you'll have to build a life to prepare for that. The last thing you need is debt while you're on this journey. So no we're not going to go that route and we're not going to get desperate and get in

such a hurry that you make the mistakes of desperation. Anytime I get desperate I get stupid right around the same time and you can really really step in a bear trap right now. So man, what a challenge that you're facing, but also the clear definition you have of it allows you to just really think about how you're going to strategize for this. So what is your business idea? So my local town doesn't have a youth drop-in center anymore so youth don't have anywhere to get like food if they don't have it. So I'm kind of looking to build the drop-in center but also incorporate like animal sister therapy because animals are my passion as well. So it's kind of

combining the two for youth to be able to build enclosures and learn about those types of things. And are you thinking of a nonprofit situation or a for-profit business doing this? I was thinking nonprofit. The only reason being is my local town has a big pot for bursaries and grants compared to other towns. So I would be able to get monthly financing through them as well to help out with everything.

What do you have to do to qualify for the grant? I just have to have a non-profit number and have the actual bill to get everything set up and that's kind of what I was going to take the financing for. I currently have a building accessible to me. It just needs repairs and everything to get to the point where it could be usable for a business. What's it take to put to the repairs? What's the cost? The cost of that will be for upgrades and renovations of $90,000.

No, absolutely not. I would not do that. The building itself is being sold to me for $40,000 when it was appraised for the same in 2014. Yeah, no, I would not put $90,000 into a brand new business I did that's unproven when I'm 21 years old. Absolutely, I would not do that. I would rent a building somewhere that's to suffice us to operate. Get your operation up and going.

Don't get in the real estate business, honey. You need to get in the business. And you need to decide which of these you want to do, dogs or kids. Don't try to do both. Let's focus. Because you're not going to survive in business if you do the real estate business, dogs or kids don't try to do both let's focus because you're not gonna survive in business if you do the real estate business dogs and kids Rachel Cruz Ramsey personality is my co-host our question of the day is brought to you by why refi why refi refinances defaulted private student

loans that other places won't touch and helps you get your life back. So kick private student loan debt to the curb at yrefi.com slash Ramsey that's the letter yrefy.com slash Ramsey might not be in all states. Today's question comes from Vince in New Hampshire. I have retired for three years with 11 million in an IRA. My wife is planning to retire next year with $400,000 in her managed IRA and another $220,000 in a pension, which she plans to withdraw to add to her IRA. Our only debt is $15,000 on our car and $100,000 mortgage.

I know you say buying an RV is like throwing your money away, but we want to purchase a used RV for around $20,000 and drive across the country for a couple of months to see sites that we missed when we were younger. After being frugal for years to save, invest, and pay down debt, can we afford to splurge a little bit now? Absolutely. You ought to pay off your car and your mortgage,

so too, immediately. If you're over 59 and a half and you can pull enough of this million six out to pay off 115,000. And I got a better idea, but you can do this. I wouldn't personally be a millionaire and be driving a $20,000 RV that sounds like hell to me because it's gonna break down so why don't you just go rent one for two months that's the best of the best and just get the like the Bentley RV or whatever you call it I don't even know

what it is get like I passed one the interstate that my wife says an air stream no it was my wife it was just a the other night, my wife says. An Airstream? No, it was just a big old beautiful thing and my wife said, ah, 200,000. I said, no, 450. Is it really? Are they really that expensive? Yeah, the super dogs are.

Should I Google fact check you right now? Yeah, you can. You can fact check me if you want. It's okay. I can handle it. Is there really four? They are $450,000. What you just said.

You can get that model, I promise you. And so, it's almost like, anyway, yeah. So anyway, I would rent one for two months rather than put 20K in something substandard and go to, it's gonna make your dream not so fun. So you can do whatever you wanna do, but you can buy the 20, but y'all pay off your house, pay off your car while you're at it.

That's simple. All right, fact checker, any help? Well, majority are going for 270, and then it says AI overview, which I know you love AI so much. It says typical is anywhere from $40,000 to a million dollars. What? What?

Done. I don't know, yeah. Matt is in North Dakota. Hey, Matt, what's up? I can't drop the mic, so I have to drop the paper. Okay. Fair enough. Longtime listener, and I appreciate you guys, all of you. My question in short is, is my mom responsible for my dad's credit card debt?

Here's what's happened. He's been moved to assisted living about nine months ago. Before that, um, he'd wrapped up credit card debt of about $18,000. Um, she's right now just paying off the interest on that monthly to get by. He does have some VA assistance that helps with his assisted living, but she's 75. Um, She cannot afford to continue doing that. So I'm wondering, it's an American Express card. Yeah, how aggressive are they?

She let that go into default. She's not on, she's not on his, she didn't co-sign with him, but she did at one time. He got her a credit card, but she no longer has that. It's just kind of an accessory. Um, it's all in his name. It's his debt. Does he have any assets?

Do they own a home? Yes. Um, they do. He's not living in it. She doesn't matter. They could sue him and take a lane against his home, which happens to be where she lives. Yes.

That's a problem. They have no money? No, no. She works part-time jobs just three days a week to just bring in groceries and that sort of stuff, but other than that their home is paid off, yes, but other than that, no. It just goes to insurance property taxes that sort of stuff. Yeah. I'm sorry. Do you have any money? Yeah, but not that kind of money. Okay.

Do you have other siblings Matt? One sister, yes. What's the house worth? Their house? Oh, they had just moved into it before he started his fall and it's worth probably seven hundred thousand. And it's paid for? Yes. Okay. All right well in order to save the house we're gonna have to deal with Amex. Okay. So they're not going to sue if they do sue they're very aggressive in their collection

tactics but they're not real aggressive and actually forcing the sale of a house that they've taken a judgment lien against that would be like less than one quarter of one percent chance of that happening okay they technically could what where's the house? What state? It's in Montana. I don't know Montana law, but I suspect they could take a lien against the house and eventually execute on the lien and force the sale of the house in order to

pay them. And they're gonna just drive her bananas in the six years it would take for them to get to that point. Okay. So, um, I don't suggest doing that. It's going to be a problem for you, for her. And, and sweet lady is just going to get harassed. Now, was he of diminished capacity when he used the card? Uh, starting to get that way. He racked up a lot of it on dental bills here in the last year or so just before he went to assisted living without her knowing. Yeah, I know, but her knowing is not necessary, but if he wasn't, if he

was like an early onset or something and you can get a doctor's letter that'll help you with the process here. Okay, so anyway, what I would do is this, I'll just stop paying it, let it go bad. Okay? Okay. And teach her to don't have conversations with them. Don't even talk to them. Okay.

If they call or they send something, just ignore it. Because they're gonna drive, if she picks up the phone every time they call, they're gonna drive her nuts, all right? Yeah, and then after about six to nine months You and your sister scraped together $5,000 and settle this Okay, y'all settle it and get it out of there so your mama's house is not at risk while your dad's Declining

You feel like Amex would settle on that no settle pennies on the dollar once it's nine months old once it's nine months old because they don't think they're gonna get their money then statistically they're not gonna get their money right will they be the ones to call us will they turn over to creditors I usually they'll keep it they'll keep it at least a year usually okay and I will tell you that they are absolute buttholes. They are horrible to deal with.

If you work for Amex in the credit card collections department, you should be ashamed of yourself and go get a good job. They're a horrible company. Okay? So just get ready to deal with Satan. Okay? I mean, seriously, this is what you're going in with. It's horrible. All right? So I've dealt with them, I don't know, 500 or a thousand times on behalf of clients and once on behalf of myself 35 years ago. So no, you do not want to, but the trick is you just got to play hardball and go, look, you're not- She doesn't have the money. That's the thing. She doesn't have the money if you're not getting paid. They don't have any assets

Yeah, and we're offering you a settlement on a bad debt Why I'm at hang up We're offering you a settlement on a bad debt. She doesn't have any money. Do you want some money? Why hang up? You're gonna have to do that like ten times before you find someone with two brain cells down there to rub together. Okay? Okay. And when you do finally get somebody on there they're gonna go, oh this guy's... because they record every one of the transactions on the file so they see every time we start yelling at them they hang up. Then they'll know that so the next time they pick up go look don't start or you're gonna be another hang up. And if

you get it Matt get it in writing have absolutely have them email you immediately a letter so you have actual evidence that they because they lie if they say they did something they didn't do it if it's not in writing it didn't happen brother thank you so much for your advice I will start saving I appreciate you both hey be good man sorry you're facing that I know it's so sad for his mom. This is why we tell you to say 15% of your household income at Baby Step 4 before you get to Baby Step 6 and pay off your house because if you have a paid for house and no money you can get in a pinch.

Austin is in Detroit. Hi Austin, welcome to the Ramsey Show. Hey Ramsey, thank you guys for having me. I appreciate you both. I have a quick question for you here. I have a 1977 Corvette that I just purchased a couple weeks ago and feeling a little buyer's remorse about it. So my question is based on my situation if you think it would be best to sell the vehicle and put the money into my mortgage or to keep it and just enjoy the ride. What did you pay for it? $7,700. Okay. All right. Not exactly mint condition, huh? It is. It was actually from my grandpa's friend. They put a lot of work into it and it's worth about 13,000, but they sold it to me for that price. They didn't want profit on it.

What do you make a year? I make about a hundred and fifty thousand. Okay you got debt other than the house? No sir just the house. Okay how much you have left on the house? Sixty seven thousand. Okay well the rule on toys that I use when Sharon and I are talking about it is if I take that much money and I burn it in the middle of the floor, $7,700 in this case, and I just set fire to it, does my life change? If it changes my life, then I don't need to spend that on a toy. Okay? Yeah. And so I think this one's probably doesn't change your life if you

lost seven thousand dollars. If you just if the car went in the bottom of a lake with no insurance your life does not change other than you shed some tears. But in terms of financially, you'd be just fine. I probably would not have bought it until the house was paid off. Matter of fact, I know I would not have bought a toy until the house was paid off, but it's not an expensive toy.

You didn't spend $77,000 on it. Okay, so you didn't, if you'd have done that, I would have said, yeah, you're out of bounds because that amount of money would change your life. Yeah, it's like half, yeah, almost the more, that's the mortgage that's left. Yeah, and so, but you know, if you like the car and you can drive it with freedom and enjoy it and then you use the, a little bit of a ouchy that you're feeling and you can drive it with uh... freedom and enjoy it and then you will use the a little bit of uh... out she that you're feeling in you use that discomfort to lean into the house that much harder

i'd probably keep it okay yeah that that makes sense here are your voice has been in my head since i bought it's not going to happen baby step you did me I disrupted the seven baby steps. You did disrupt the seven baby steps. You did do that. But no, I mean, seriously, no, honestly the, no, that's not true because. He was hearing you. I know, but I know, but I was thinking he did disrupt them. But if you're thinking about baby step four or five, six, which is where you are, you're living intentional.

And this is where you would upgrade a car or buy a boat or buy a couch And he bought a seven thousand dollar toy. Yeah. Yeah, so no, it's not really out of line It's not really out of line, but it is a luxury It was a pretty heavy luxury item You know, so it's okay. I think you're okay. I think yeah, the car. Austin. Like do you, you enjoy it? I do. It feels really good. My wife likes it. You know, we went for a ride the other day and it's, yeah, it's a step up from what we drive right now, which is, you know, whether it's compact SUVs. So it is freeing for us. Yeah, I keep it.

I keep it. You're good. Yeah. But I think if it was a, if it was a larger number to where it would hurt you, then yeah, I'd probably sell it. But the good news here is that when, when I saw classic car pop up here, I was not thinking $7,000. Yeah. You're thinking more. Yeah. I was thinking this call is going to be, somebody spent a lot of money on something, but it is relative. That's the thing. It's like, I got a friend that bought a Lamborghini. I mean, he bought a, had gone,

what was it, 400,000 bucks or something. And I'm like, man. But he made 15 million last year. So I mean, he could burn that in the middle of the floor and it would make all of us cry, but his life wouldn't change. It's like when you see those stats of like what Bill Gates makes well he's brushing his teeth like every two minutes you know what I mean it's like $80,000 every two minutes or something just insane. Yeah. We're like oh my gosh.

It's a different it's a different ratio and that's the that's how you know you can actually afford something is the ratio that That's what you're looking for. So I remember we did one the other night on something. Tiger Woods at his top of his game when he was making the most of the most, he bought a 70 million dollar house. And this was many years ago, obviously, he was back when he was really at the top of the golf world. And all these people are coming out like, who needs the $70 million? Who's been? And that year, his income was 1.2 billion

with endorsements and everything. And so him buying a $70,000 house is like someone that makes $250,000 buying a $15,000 car. I mean, that's the ratio. It's nothing, it's just nothing. And so ratio-wise, but it's just mind-blowing because most of us have never even seen a $70 million house, much less buy one,

but you've also never seen 1.2 billion in one year either. So it's a different, I mean, it's a different thing. So you're looking at the ratios there on things and that's a good way. mean, it's a different thing. So you're looking at the ratios there on things and that's that's a good way Make sure you you're always giving you're always enjoying and you're always investing your money. Mackenzie is in Nashville. Hey Mackenzie How are you? Hi, Dave. I'm good. How are you better than we deserve? What's up? I'm trying to quick question. Well, maybe a quick question, but if we should sell our house,

our in-laws have offered for us to move in with them, save some money, pay off our consumer debt, and then save some money to buy a new house closer to my husband's work. How far are you from your husband's work? He's, they're moving him to an hour away from our house. Okay, where? Mur from our house. Okay. Where, where? Um, Murfreesboro. Okay.

How much debt do you guys have? So we have about 60,000 in consumer debt. So that's going to be three of those are our auto loans. Uh, one is 20,000, one is 10 and then a motorcycle that's 16,000. And then we have a 10,500 in credit card. How much can you get for all the cars? We could, unfortunately the Jeep is the $20,000 one. I think we could probably get a little bit less than what it's worth. Okay.

Maybe come out even. So 17,000. I think. Even on the 10? Yeah. How about for the motorcycle? Motorcycle, break even. The motorcycle potentially, I mean it's a 12 Harley-Davidson Road Glide I think or something like that. I think they're a little underwater on that. The one that I know we could sail and break even for sure is my... So, McKenzie... Your in-laws live in Murfreesboro? They live in Rockville so

pretty close. No I would sell your house and rent something near where your husband's working and I would sell your motorcycle and I would sell your car. Okay. And I would get out of debt really really fast. Okay. How much can you get for the house? I think we could get potentially 300 out of it. In equity? No, no. We owe 258, so I think we would come out what we calculated with our realtors, maybe 23, 25,000 after closing costs.

Okay. So you would be debt free and renting if you sold the motorcycle, sold the car and got twenty thousand? Yeah, the question about the motorcycle is I think we're underwater on it. Not much, not much. You can sell it. You just don't want to tell him he needs to sell his motorcycle but he does. He's broke. Broke people don't buy 16,000 dollar motorcycles. Right. I don't care how sweet it is. He's getting ready to move you in with his mother because he won't sell his motorcycle.

Are you hearing this? Seriously. Buy motorcycle. Bye bye. No, we're not moving in with your mama. No. No. Nope. Nope. Nope. Y'all go y'all go get a life and you're gonna sell the house because you need to move closer To his work anyway. Yeah, not for the debt. That's we're not selling the house because of the debt

We're selling the house because you're gonna need to move closer to work, right? Right, it would be a plus To take care of it. Yeah. No, I would not move in with your in-laws. Yes I would sell the motorcycle, sell the car, and sell the house. That's exactly what I'd do. You're not gonna do it though. Oh you can do it Mackenzie. I believe in you.

She would do it but I don't think she's gonna talk to him about it. I don't think she wants to bring it up. Oh I bet she can. I believe in you Mackenzie, go girl. All right, this is the Ramsey Show. Live from the headquarters of Ramsey Solutions, it's the Ramsey Show. Live from the headquarters of Ramsey Solutions it's the Ramsey Show. We help people build wealth, do work that they love, and create actual amazing

relationships. Rachel Cruz, number one best-selling author, Ramsey personality my daughter is my co-host today open phones at triple-8 eight two five five two two five Angelica is with us in Mobile Alabama hi Angelica how are you? Hi thank you so much for taking my call sure what's up and so I have a question my husband and I have been living separately for almost a year now. He is active duty and he's what? Because he's active duty. Oh yeah. He was in the Navy. So we, due to his orders, we decided to move me back home to be with my family.

Well, he got injured shortly after moving us back here and we'd been living separately and he got, I guess, moved from those orders. So what we've really been struggling with is how to manage our budgets separately. Even though our money is together. I'm sorry, he got injured. Yes. So is he being discharged? No, he's been on limited duty for a year. So he's been where he's at now, kind of basically waiting to see if it will heal or to see if he is inevitably going to get medically separated or retired. And what's the timeline on that, do you think?

We're waiting to hear something by the end of May and if they send him back out, then he'll be gone for another nine months. If he doesn't, then we will know in August. Oh, if he's healed enough to go back out? Correct yes. Okay. And where is he right now? Is he as he? He's in Virginia. Okay. Do you guys have kids? Yeah we do we do he is a little over a year old a little over a year and a half. So you're you move be close to family, right? With all the logistics with kids. He was going to be gone all the time and now he's not.

Now he's sitting there. Okay. Correct. And we're also managing the travel to and from, and his leave is being depleted and you know, he drives as much as he can, 15, 16 hours each way. Yeah. I think, I think we're going to put you guys into the Every Dollar Premium Budget app. Okay. And both of you have access to it then.

And what I would, what I'll do is I'm going to give you two accounts, not just one. Okay. I want you to have one account that is the master budget. That is everything you all are doing for the whole household, including, and you're the primary account that is the master budget, that is everything you all are doing for the whole household including and and you're the primary on that one and then I want him to have a little miniature budget for his day-to-day existence. Okay. And if you can do that do the miniature budget without using a separate budgeting app I would prefer you make it a line item

in your main budget. That's what I was thinking. Have one main budget and then he has a full other section within that budget that's his expenses so that you both kind of see it. Yeah, a lot of military families use every dollar for that reason on deployment because even if he's out of country, if he's got internet access, he can look and see exactly what you're doing with the money and you guys can communicate what we're doing. You're managing your money together even though you're not in the same country

and because the app allows you to do it seamlessly as one couple even though you're much more than across the room, you're across the world. But it's still the same function. You're both looking at it You're both seeing everything the other ones doing it both fits in we've agreed that you're spending money when you're all out of country is X and that's a part of our overall budget and he can see that you paid the light bill and he can see that you kept the food on the table at home and

And I'll tell you this it sounds like that he's maybe special ops is he he no he's more cyber security okay all right I just I could tell something was going but I couldn't tell what it was okay the so What we found is working with the military for 30 years now that mission readiness is Increased the guys and gals that are on the front lines and sometimes in danger are much more and sometimes in danger are much more competent at their battle skills when they know everything at home is set that the table set at home. And so him having access to you running the budget watching over your shoulder with every

dollar helps him when he steps out there in the edge of stuff to protect in this country. Okay. It helps his mind be clear in other words and to do the job he's being hired to do and we appreciate his service and we appreciate your sacrifice as well honey. So we'll give you two of them but I'm going to suggest you use one. Okay. And that you put his part as you can have two or three line items. You can two or three line items. You can make up custom line items in it. And even if there's something with his paycheck

going into a different account, if there's something there, you can connect multiple accounts to it. So it's all going into one budget, which is nice. Yeah, you can put it all in there, and it all really should go into one budget and into one account. And then, because it's easier for y'all to manage,

but once you're using this software,'s this and if he's tech guy He's gonna love this this software because it's robust. I mean this app is incredible It's it's the world's best budgeting app by far So you hang on and I'll have Christian pick up and we'll get you a couple of them But I'm gonna tell you probably you're gonna give away one to a friend one of his other buddies. Yeah deploy Yeah, I think the perfect situation is that you guys have one account, all the incomes go in there, you budget out of that account, you're going to have different line items for his situation. But sometimes we do see with like, yeah, military stuff or other things, like, yeah, there's

two different accounts. So if that's the case, you can hook both up, you can hook up multiple accounts to every dollar. But I think functioning out of the same budget. Is the best thing. Yes. That's going to give him more gonna give him more clarity and it's more, it's simple. It's gonna give him more peace and it's gonna give you less strain because you don't feel like you're carrying all the decisions by yourself. You know, I got the whole thing on your shoulders. He's looking over, he's watching it with you even though he's not sitting beside you to do that. So again, thanks for your-

It's a pretty remarkable thing when we talk to active duty military families, how many of them still continue to get out of debt? They're still working a plan, but they're like, and it took completely different continents, some of them for a period of time. So it is, it's pretty remarkable. They make really good headway. In some cases, if they're in a battle zone, of course they're getting tax-free income.

So that's a whole different thing too. Yeah, that's so true. It's beautiful to be able to use all that and make progress, you know. Yes. That's the thing. So it's good stuff. All right, that's the Every Dollar Account Christian.

We'll give them two of them and give her two different signup sheets there and we'll get them going on that. That thing is we've been iterating that and working on it for several years guys and if you have not looked at the EveryDollar account lately it's gonna tell you exactly what you need to do next to walk your way through the baby steps and it's gonna based on what you enter into the budget it's gonna read your mail and tell you it's a little spooky. And the onboarding process too has gotten more robust so knowing your on what you enter into the budget it's going to read your mail and tell you it's a little spooky in a way.

And the onboarding process too has gotten more robust so knowing your information and where you're at even in the baby steps all of it it starts to it's building out more and more which we love. Yeah it's going to show you exactly what to do next and exactly what to do next to walk you out of debt and into wealth. It's a pretty cool deal y'all. You don't want to miss this. This is The Ramsey Show.

Trey is in Mobile. Hey Trey, welcome to The Ramsey Show. Hi Dave, hey Rachel. I appreciate your time. I'm just looking for some advice on how to invest money that I'll be receiving. Okay. What are you getting? So, right now we're looking at about $200,000 from an inherited IRA. Unfortunately, I lost both my parents recently. Oh my goodness. What happened? Yeah, thank you. Well, my mom passed away from cancer and dad had a heart attack. Oh my God, Dre, I'm sorry. Yeah, yeah, it's life though.

So obviously they're hard work, you know, they left over this IRA and then the home that, you know, we grew up in and you know, obviously we're having to sell that now. So it's about $200,000 and then the inherited IRA and then splitting it with my sister we're gonna be about $200,000 each when we sell the house as well. So my big thing is obviously the inherited IRA is gonna have to get pulled out over time. So just my idea is you know pull it out and actually put all that money every year and just max out a Roth is my first idea. Is that like the best idea to pull that out, pay taxes and then put it straight into a Roth?

No, I would put it on wherever you are in the baby steps. Okay, so we have no consumer debt. We have have 26,000 on a vehicle And we rent so I know 26,000 on a vehicle Yes, and that'll be the that is that is consumer. Okay, okay I know credit cards. Yeah, okay, so you owe 26,000 on a car. What do you owe on your home? We were renting okay, and you're getting $400,000 total right? It'll roughly I think it'll be a little north but taxes fees. And then taxes on 200 minus taxes on the 200 inherited IRA. Correct. Okay all right. Well you have any money saved?

Yes we have $15,000 set aside that's like our three to six month kind of backup plan our emergency fund. Okay all right well our baby steps say baby step two is you pay off everything but the house then you build an emergency fund of three to six months of expenses so what I'm gonna do is just kind of freeze right now and as soon as you get your hands on some money first thing you do is pay off the car. Second thing you do is you raise that 15 up to 25 because that 15 is probably low. What's your household income? 80,000. My wife's a stay-at-home mom of two. Yeah you need 25 in there. Okay let's get it on up a little bit. It's three to six months you're down on

the three side and then I'm gonna liquidate everything and buy a house for cash. Okay. You gotta be able to buy about a $300,000 house right? In the area we're in it's mostly well I mean that's definitely on the lower end of what's in the area but yes I mean that should be really really close to it. No it's about the medium, about the middle of your area. Gotcha. Yeah just from what I've seen but I mean I'm also looking at... Well the median household, the median house price in America including Los Angeles, including New York City is 400,000 some change. That's the median nationally. In Mobile, Alabama, I promise

you it's less than that. So median is going to be around 300k in your area, so you'll buy a house about the middle of the market. So take take your time and shop there's no rush. Go slowly. You probably got a little time left on your lease anyway. But I'm going to say I'm going to set that money in a high-yield savings account and go shopping and you know time it time the purchase with the end of your lease and get you a bargain and pay cash. Now if you're making $80,000 and you have zero debt, house and anything and you take your old house payment and you max out all of your retirement you're gonna be a millionaire in about 10 years. Actually you're gonna be a millionaire not counting counting the house you have

about another million dollars in about 10 years. How old are you guys Trey? I'm 34. Yeah so by the time you're 40, you're going to be a millionaire plus because you have a $300,000 paid for house. It will go up to about $600,000 during that time and you will bank in your retirement accounts probably about another $600,000 or $700,000. And so that's where you're going to end up. You're going to be approaching $2 million in your 40s, okay, if you do all this and you stay out of debt and you stay on a budget, okay?

You don't mess this up. Yeah, and if you just follow the baby steps, that's where it'll take you. Yeah. Yeah, they set us up. I'm not gonna mess up. Yeah. It's great, Trey.

Well, that's exciting. I'm so sorry that it came from such a devastating situation but it's always when we talk about inheritances, always living out that legacy of those that left that and I think that's a great thing for you guys. One of the things I think about when I'm telling someone what to do with money that mom and dad left is when you do this, these steps that I just outlined for you, is your mom and dad in heaven smiling? Are they happy happy with this I think they are because the kind of people that built this kind of money is the kind of people that would be happy

with you being smart absolutely yeah so you're on you are honoring their legacy in a very real sense hang on I'm gonna send you a copy of the book the baby steps millionaire book because you're getting ready to be one. And you did get a boost from an inheritance, which statistically makes you unusual, but that's good. Still, there's no shame in that. We're going to go there. We're going to go there as fast as we possibly can. Nicole is in New York City. Hi, Nicole. How are you? Hi, Dave. I'm good. How are you doing? Better than I deserve.

How can we help? Good. Um, so actually I'm proud of myself today. I paid off one of the cards, $8,000. Yay. Nice. Thanks. Um, so I just wanted to know what do I do?

Do I call and cancel or just, you know, let it be? Yeah. Call them up and cancel. Yeah. We always tell people when they're getting out of credit card debt, cut up the credit or just, you know, let it be. Yeah, call them up and cancel. Yeah, we always tell people when they're getting out of credit card debt, cut up the credit cards, pay it off, and then once there's no balance, then you can officially close the account.

So go in and, yep. There's no accidental spending or fraud happens on a closed account. Okay, perfect. That's great. How much more debt do you have, Nicole, to pay off? About another consumer, maybe 20 with the car and everything. Okay, yeah.

And then I have the house. Okay. So baby step one, little by little. No, yeah, you're on to baby step two. Yeah, good for you. Good job, Nicole. Well done. Congrats, that feels good.

You kind of feel like you can do it now, right? Yes, yes, absolutely. Okay. How long you been working on this? Well, actually I've been looking at you guys for years, but I just started maybe about three months ago. Good, okay. Alright. Hey, $8,000 paid off in three months. Pretty good. That's pretty rowdy. Excellent job. That's pretty rowdy. Yeah. Excellent job. That's how it works.

I love it. Yeah. The return taxes, you know, that helped. Oh yeah. Yeah. Using your tax return for it. It's great. Oh yes. Yes. Absolutely.

And you've adjusted the W-2 now so that you don't get tax returns anymore because that just means you had too much withholding. So good job. Well done. That's great. Very well played. Very well played. Sarah is in Atlanta.

Hi Sarah, how are you? I'm good, how are you? Better than I deserve, what's up? Very good. I have a question. I am 57 years old and I was, been divorced for 20 years and raised two kids. So now adults.

And I am what you call an everyday millionaire and debt-free. Well good for you. Good job. Thank you. In a couple years I know I'm gonna buy a new car. Okay. A used car but new. Okay. And my goal is I mean I definitely am gonna pay cash. Mm-hmm. And my boyfriend keeps telling me that that's not a good financial decision. Your boyfriend doesn't have as much money as you have. Right and he, and the reason he said- Why would we take financial advice from a broke person when you're a millionaire? I know he can, but well mathematically he's saying if you take the money out of mutual funds-

Mathematically he's stupid. No. We need to tell him. Yeah, you can tell him I said that funds... Mathematically, he's stupid. No. I need to tell him. I can't wait to tell him. Absolutely. It's asinine. There is no data on the planet that says people become millionaires by borrowing money on their car and investing the difference. None. Zero millionaires on the planet did that. To become millionaires.

So don't take financial advice from broke people you're smarter than he is listen to yourself way smarter it's financial literacy month if you didn know, there's a huge movement in high schools and there has been across America for many years. Several states have now passed laws mandating that you take a personal finance class in order to graduate. And I think it's 30-something states now. And the good news is is that we have a high school curriculum called Foundations in Personal Finance that is taught in about 48% of the high schools.

Over six million students have been through it now. And so we love celebrating Financial Literacy Month and celebrating the idea that teens can learn this stuff before they're 30 and learn it the hard way by doing something stupid like I did. Okay, it's pretty cool. So we want to honor the teachers this month of not only our curriculum but honor all teachers while we're celebrating financial literacy month and I got one on the phone Patrick is in Jackson, Tennessee and he teaches foundations in personal finance in his high school. Thank you for doing that Patrick Patrick. How are you?

You're welcome. I'm doing great, Dave. How are you? Better than I deserve. Now, it's Trinity Christian Academy where you teach, is that right? Yes, sir, in Madison County, Jackson, Tennessee. And how many students are enrolled there? From six weeks old to seniors around 700. Oh, wow. Graduating class 50 to 60 every year. Okay, that's good size. That way they can, it's big enough that they've got a lot of stuff going on, but it's small enough to get a lot of attention, right? That's correct. How long have you been teaching the curriculum, Patrick? This is my ninth year or 18th semester teaching the curriculum. I did the DVDs and then we

transferred over to the digital. You have a very unusual distinction too that around here we're all just jumping up and down going Patrick's a hero because one of the high school students that graduated from your class many years ago is now an adult came in here and did their debt-free scream the other day on the air with George. I'd say that's what we call paychecks as teachers. You know those stories you get from former students and even coaches for players but those are that was a true paycheck. When she messaged me, she messaged me two years ago letting me know that she

was going to be on the Dave Ramsey journey and she couldn't wait to get on the show for a debt-free scream and then she messaged me that day saying hey we made it and then I got to listen it was incredible. Faith and Cameron from Oak Ridge Tennessee if you guys want to look it up see the debt-free scream it's pretty cool very cool and they paid off their house and everything and their kids they're little ones I mean and had a zero credit score mortgage. I love it it's all your fault Patrick. Way to go man these people are gonna be millionaires because she had a high school teacher as a stud.

Man you're amazing. I'm so proud of you. Have you had a lot of those? Have you kept up with students? I mean after you've been teaching that long? We do. I text them from time to time. We have I would say 20 to 25 students that started a Grow Stop Mutual Fund since I've

been here. Instead of spending the money they just have been in Arthur's story and now the Jake Blake and Blake. I forget the other guys. I've been in Arthur for years. They changed the name, Sonya. Yeah. And I keep up with them. I get stories from all over and it's been great. I tell them I teach to an 18 year old invisible kid every day. It sits at the front desk and that's me 24 years ago that either wasn't taught or didn't listen to what I'm about to teach you in this class and everybody

everyone is subjected to it. Well I'm always thrilled that the kids love the class and I shouldn't act so surprised but because I was in high school all I could think of was you know when I'm learning something right now how's this ever gonna affect me as an adult because I've never really used the Pythagorean theorem But I have used this I've used this stuff for sure so how am I gonna use this? I think that one of the main things we hear back from the students And I'm sure you do too is just the fact that they're teaching them something They're gonna actually use and they message you back a few years later and go I got a zero credit score mortgage

And I just paid off the house. That's pretty cool. So is that what they tell you that that they love doing learning something that they're actually going to use? It's just all applicable day one of being a young adult and you know taxes, insurance, budgets, investing. Just stuff to do at 18 that's gonna save you that your next 30 years. Yeah. But it's all applicable to life ASAP. Now thank you, thank you, thank you. You're a hero man. I appreciate you doing this. And it's ever since I wrote the first little book, Financial Peace, and I was carrying it around the trunk of my car, people have been saying, why don't they teach this in high schools? And the

good news is we do, and the way we do is because of men like you, Patrick, and women like you. So thank you The teachers out there in the marketplace are amazing and very very cool. Thanks for doing this brother Actually, thank you very much. Yeah, thanks Patrick Very very cool Hey for any of you that are teachers that are listening or if you know a teacher be sure and tell them Be sure to enter the Ramsey teacher appreciation giveaway we're gonna give one teacher a $5,000 vacation,

and the two second place teachers are going to get two more, are going to get a $3,000 vacation. No purchase necessary. You don't have to be teaching our curriculum. You just have to be a teacher in a school. Now, I once taught my dog to sit does not qualify you. You're not a teacher, okay? So if you're teaching in a school with students,

you are a teacher or if you know someone, no purchase necessary, no salesman will call, go to ramsysolutions.com slash teacher to enter a $5,000 vacation. And two more teachers are gonna win a $3,000 vacation if your name is drawn. Spencer's in Denver. Hey Spencer, what's up? Hey Dave and Rachel, thanks for taking my call.

Sure. I have a just a real basic question for you that I need some help with. I'm wanting to find out if I'm investing too much to enjoy being debt free. My wife and I, we're completely debt free. We're maxing out both of our 401ks. We're both over 50 so we get the extra amount and we're also maxing out our IRAs. What's your household income? So I take home, well our household income is about a hundred thousand each and then after investments and taxes mine's about take home about fifteen hundred every two weeks and my my wife is about about the same about seventeen hundred what

is it what is she's wanting to do that she says you're too aggressive and you don't have the money to do because you're putting all of it in savings? Well, it's not me. It's not her. It's me I'm wanted to eventually save up for a sports car and I'm having a hard time Getting enough money to do that with all of our money going into investments. Yeah, let's just you know Just having normal money just to do extra things Without having to take it out of the money that we're getting from our yeah well you guys are almost if my

math's right you're you're almost investing close to 30% is that right if you're maxing out these houses paid off both 401ks oh your house is paid off yeah mine's mine's probably a little over 30% my wife's is about 40 percent but the percentage of your household income is gonna be in the 30 percent range of your total to total right so that's what she's saying and so yeah yeah and how old are you guys I'm 15 my wife's a few years older than me. How much are in the accounts right now? So my 401k, I've got 750. My wife's 401k, she's got 400.

Plus she'll get a teacher pension with the school districts taking out money out of her paycheck for that. And then our combined IRAs is about 550, including about 80,000 for an emergency fund. You got a three million dollar net worth and you can't save up the money to do it by a sports car. Yeah, I'd crank it down a little. Okay, okay. All right. Like, our investments are through our work, they're lost. So I really enjoy. Oh I enjoy I love the numbers but you just you're telling me you pinched yourself to the point you

can't enjoy the wealth you've built. Yeah which that's completely true. And I don't if that that's what I heard you say you know if you can if you can figure another way around it if the money's going somewhere else that's fine but with that kind of net worth you've done a great job congratulations. Amazing. And if you want to crank the savings down and the lifestyle up a little there's no that's fine, but with that kind of net worth, you've done a great job, congratulations. Amazing. And if you want to crank the savings down and the lifestyle up a little, there's no sin in that. Okay, okay, and just one last question.

With Mother's Day coming up, she really wants me to get a pedicure with her. Would you suggest that I do that? Yes, yes. Dave, that question's for you. Yes. Hey, I question's for you. Yes! Hey, I think you would enjoy it.

It's actually very relaxing. Do that with her. Dave wouldn't. You know what? Thirty... thirty-six years or thirty-three years on the air and I've never been asked that question. I thought I'd been asked everything at least once. That one's a new one.

This is the Ramsey show You can hear and watch the entire show on the Ramsey Network app for free Parts of the show are not in the podcast every day and are not on YouTube every day You can pick them pick them up only there or on talk radio if your local talk radio station carries the entire program. So be sure and check that out. Today's Ramsey Network app question is from Gary. We buy one million dollars worth of supplies every year for our business. We put it on a company credit card and pay it off immediately so we don't pay any interest. What am I missing? I understand if I

don't pay the charges within the first 30 days then I have to pay interest but I'm paying it off immediately. Why is it wrong to take advantage of getting these points? Because honey you are chasing points instead of running your business. If you burn the calories running your business that you're doing trying to beat the credit card company at their game, I mean you're just at Chuck E Cheese getting the tickets. That's all you're doing and you know you're spending a bazillion dollars to get tickets at Chuck E Cheese to buy nothing and you're burning up all of your creative energy that you should be

using to run and grow your business screwing around with trying to beat Citibank at a game that they designed to beat your butt. You might actually be winning mathematically a little bit but you act like this is a zero-sum game and it is not. It is not. So no, no, no, no, no, no, no. I buy, I don't know. Let me think not me Not a million dollars a year in supplies. We buy yeah Probably 50 million a year in supplies at Ramsey and we don't use a single credit card to do it

We just freakin buy it We just pay pay the bill and we go run Ramsey instead of trying to run around chasing points Chuck E. Cheese tickets. Man, I go down there with the grandbabies. I go down there with the grandbabies and they just wap, wap, wap, wap, wap, wap, wap, and they run, work, work, work, work, work, and then they put it on a card now, right? It used to be they spit out the tickets all to get an item that is worth like a penny. Crap. I mean, it's really crappy little toys. They're not even good toys Well, yeah And I think it's that's that point and it's always the risk like you put a million dollars on it

And then what if one year a coat, you know a pandemic hits and you can't pay it Then you got a bit, you know what? I mean like there's just there's just it's just not worth the risk Like there's just peace of mind knowing that you have autonomy over your life your money in your business and it's just more peace that way too so you know see if you get 1% on a million dollars that's ten thousand dollars right yeah so you're working all that to make ten thousand dollars worth of points by the way 78% of the credit card miles are never redeemed. Consumer Reports says that.

So it's just, it's a game that they designed. It's like going to Vegas. House wins, man. House wins. You don't come out of Vegas with your shirt. They didn't build those dad gum, they didn't build those lobbies with world-class artwork and light fixtures,

and they didn't build that with their money. They built it with your money. People who lost money thought they could beat the game. And this is the exact same deal. It's the exact same deal. Those towers in the skyline that Citibank builds, you paid for them, America. They didn't pay for them.

You paid for them by doing crap like this right here and falling for it. Yep. They know what they're doing. That's the deal. That's the deal. All right. Open phones at 888-825-5225. Nick is in Springfield. Hi Nick, how are you? Hello. Thank you for taking my call. Sure. What's up? My wife and I, we're in very good shape financially. Less than a year ago we inherited some money that tripled our net worth. What is your net worth? Total

mm-hmm right now mm-hmm 2.5. Good. Awesome. How much did you inherit? 1.5. 1.5. Okay, so you're already a millionaire. Good. Way to go, man. That's awesome. How can we help today? Do we help our kids have now or do we just keep building wealth and then die in 20 years and give it to them? It's a straight shooter, Nick.

Either one is fine. There's nothing immoral about either one if you're going to do stuff for the kids. It should be Enhancing them being as smart as you are if they're misbehaving and you give them money you're not helping them you're enabling I would agree we committed to the boys To be debt-free from college they are and upon And upon graduation, we'd give them each a car, which we did. Now, when I say about cars, I'm 60 and I've never bought a new car. They've all been used and they've all been salvaged titles, so they're cheap. So I'm cheap. Wow. Are the boys doing well with their money? Are they saving money living on a budget,

staying out of debt? They are. We haven't given them the oldest one money in four years. Now granted when he graduated college, he did move back home, but he has a WALTH IRA and he's contributing to it every month. Is he married? No, neither of them are. Okay, are either one of them married? No. Okay.

The youngest one's just graduating from college and we haven't given him any money in the last year either. What I want to do is I want to enhance positive behaviors with your gift. If your gift is not doing that then I would hold the gift for a while. Okay. But let me give you an example. Let me give you an example. Let's say these two guys continue to be industrious. They both go get good jobs. They live on list. They make, they pile up some money. They get married, start a little family and they're 28 years old. Maybe you buy them a house and pay cash for it. We already talked about that.

And then they pay payments into a mutual fund instead of paying payments so that they're multi-millionaires by the time they're 35. Yeah, Nick, there's an interesting book, Die with Zero. It was a great book and it applies kind of to your situation. Not everyone's able to do this, but his idea was, which research shows is what he was claiming in the book, is that from, I think it's like ages, I'm gonna mess up the age range.

It's like 24 to 35 is when kids need money the most, meaning like down payments on house, if they're paying off student loans, all of that. Because to your point, Nick, if you build up all this wealth and you die at 85 and your kids are 60, they're already well established. They already may have grandkids of their own, right? So what can you do with money as a tool

to help enhance the next generation if you have the ability to? and it's stuff like that. I think assets. I mean, you already did some good moves. You paid for the college, the road debt coming out, paid for the first car coming out, and you got a good start that way. And then if they pay cash for the first home along,

I would say have them do a pledge, a promise never to borrow money. And I promise take the blessing of this house and take the house payment and put it into mutual funds and build some wealth for the next generation. You can change your family tree with that. But they have to also be in on the program. You can't give them enough money for them to be stupid. It doesn't work. I mean you know they're stupid will always outrun money. Would you rather, at your age, see your kids, which is me, so I'm crying.

Yeah, that's a, we have a conflict of interest in this question. I know, I know, I know. But I'm just saying, like, because I have little ones, so now, I mean, we're teaching boundaries and know all the time with stuff, but like, you know what I mean? Like, would you rather see people have their kids be part of their financial legacy

while everyone's still alive? Yes. Versus like having a bunch of money when you die. Because you're accelerating the net worth of the total family by doing that. Yeah. And you're in, but it only works if you're enhancing proper behaviors.

Right, if they have the character. If you're enforcing but it only works if you're enhancing proper behavior. Right. If they have the character. If you're enforcing proper behaviors. But if they're like, Oh, I think Dave Ramsey is an idiot and you know, no, the idiot will just keep his money. You know? So no, I can do that. So if we say that Dave Ramsey is an idiot, then I'll just keep my money. Yeah, that's okay. I'm kidding. I'm kidding. But no, I mean the, uh, but, and so Sharon and I right kidding, I'm kidding. But not, I mean the, and so Sharon and I, right now, we do stuff like we'll buy a trip

for the whole stinkin' bunch. Yes. So we all go somewhere. Yes, yeah, yeah. So in a sense, we're doing that. Enhancing experiences. We're having experiences and lifestyle issues with cash while we're alive.

Yeah. I'd rather go on the trip with you and pay for it. Yes, yes. And all of us do something together, than I would you do that and celebrate after my funeral. Dave's gone. We're going to the Caribbean. Ha ha Tahiti.

Yeah, but I think that's true. And I know not everyone realistically can have that conversation. We've had people on the show today that they're in retirement and they don't have enough money for themselves, right? Right, no, that's first. So yes, so it's the idea of that legacy changing while you're alive. I don't know. I think it's cool. It's great.

Cool question, Nick. Appreciate you calling in with it. Gives us a soapbox to work with. I like it. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show. We help people build wealth, do work that they love and create actual amazing relationships. Rachel Cruz, number one bestselling author, host of The Rachel Cruz Show, co-host of Smart Money Happy Hour on Ramsey Networks and my Rachel Cruze show, co-host of Smart Money Happy Hour on Remzi networks, and my daughter. She's my co-host today. Doris is in Canada. Hi Doris, welcome to

the show. How can we help? Hi, thanks for taking my call today. Sure. My husband wants to have alcohol in the budget and I don't... I'm just wondering if you can tell me where that would fit in when we're in baby step two. It's not a money argument. You just don't want I'm just wondering if you can tell me where that would fit in when we're in baby step two. It's not a money argument. You just don't want alcohol in the house. No, I don't mind him drinking it. I just personally never have and don't want to start, but I see it as a good way to cut in the budget to make extra payments onto debt.

So it seems like an option. Oh, because you're on baby step two. Okay. So what is the alcohol budget he is proposing? He hasn't proposed a budget but from tracking our expenses it seems to be about $35 to $40 a week. So to me that's $160 a month that can go somewhere. What's your household income? It ranges between about $225 and $250 every year. I'm going to say it again.

I don't think this is about $135 a week. You make $250 freaking thousand dollars. How much debt do you guys have to ours? I think this is about you don't want alcohol in the house. I don't believe you. I really don't have an issue with the alcohol. Our debt is pretty high. We have a truck loan, a car loan, a skidoo loan. loan and then there's also I guess it's called the home equity loan how much is

all that total would fall into um does the home equity loan fall in with the when we paid the mortgage off or with our debt is it more than half your annual income how much is it it's about about a hundred thousand dollars. Okay it's probably gonna be a baby step six you may need to refinance and get rid of it. I don't know how it works in Canada. What do you owe on the truck? 39,500. What do you owe on the Sea-Doo? Ski-Doo, we're in Canada. That is about 13,000. 13,000. And what other consumer debt is there? Another car. There is a car which is about 23,000.

And he has a credit card that is solely in his name that uses like for work and stuff and that's about 10,000. Now I do know that would fall to us if ever it came due, which is why I count it. Yes, it needs to go away. So I think I'm also hearing that it's not just a alcohol budget then I may change my mind on this. It sounds like he's not really very engaged, he's just tolerating you doing this. Great. Yeah, I think that's a much bigger problem than $35 a week. Because he's driving a truck he can't afford.

He's driving a truck he can't afford and you got a toy in the garage you owe 12 grand on and he's just kind of like, well, whatever you want to do honey, it's okay. And you're like, I got to get rid of this debt. You're leaning in and he's kind of hanging on the outside just watching hoping you'll get over this fever you got. Yes. Well he's enjoying a beer. Yeah, yeah, sipping a beer on the back porch hoping you'll get over this, yeah. So I think that I think all of that is much more important than $35 a week for beer. If he was completely engaged he's's like, Hey, I probably need to sell this ski do. I probably need to do this. I may need to think about selling the truck or we've got to really tighten up on

everything and lean into this. Then the $35 wouldn't bother me, but I think it's symptomatic of his lack of intensity on this, uh, or lack of involvement with you. And I want him to support you overall a lot more than that. And maybe it's not you don't want alcohol in the house, maybe you're just trying to poke him a little bit to get him like a little revenge here, like, oh, you're not gonna get involved,

I'm taking your beer. It's kind of like a husband being like, she can't get her hair and nails done anymore. Yeah, we're trying to cut that out. Yeah, we're gonna cut out the $3 for something. No, that's not the issue. The issue is you guys need to get, you need to sit down and talk about how this is stressing you out.

And honey, I know it's not stressing you out. And that's why the alcohol thing comes up, because I really need you to understand and to plug in with me on getting these other debts paid off, and if I can get that, $35 a week won't matter. Yeah, I would rather have you in this process, right? Yeah, that's $5,000 a month is what that is, getting him involved, and so you stop your long-term investing,

you stop eating out, you stop going on vacation, you look at if you need to sell something if you can't pay it off fast, you need to sell it. And that kind of stuff. And you both agreed that this is the best way for us to have a high quality future. We make too much money to be this broke. The plan we've been using sucks. We need a new plan, honey. That's what I've been trying to get you to do. And it all landed on the beer issue. And it's not really a beer issue. Yeah. That's okay.

It's a little different conclusion. I jumped to conclusions and I was wrong at the first. Yeah, and you know, we have couples on the debt-free stage all the time. And we talk about their journey, and there's always kind of the one nerd, and they're like, she was really intense or he was. But the idea is like, there may still be one

that's like super, super, super nerding out on all the numbers and so intense and they would do nothing but literally eat rice and beans. And the other one may not be as intense, but they're long for the journey. Like we are locking arms and we're doing this. So just couples out there as you're working together, no, you may not be at the exact same personality type

and level, but you're going in the same direction, right? And then these big moves, especially selling assets like cars and all of that, you have to be on the same page with all of that, right? To make those big moves, so it's hard. Make the kind of progress that goes with that. Yes, totally. It's just, for you spouses that are out there,

if you happen to be listening to this, if you're standing on the edge, watching your spouse be intense on the inside, you're disrespecting them. This is someone you love, and it means a lot to them to work on this. You don't have to go as crazy as they are, but you need to get off the edge and get both feet in the boat. Even if you're not going to row as hard as they're rowing. You need to be on it because

it's disrespectful. And that's what she's facing. So I was picking on you earlier Doris and I was wrong about that, about your reason for doing this. And I think your real reason is actually a better one. But I'm not going to give you a ruling on the alcohol. I'm going to give you a ruling on the husband on the fringe. And then the alcohol will solve itself. And that's where we'll go from there. Open phones here at 888-825-5225. Guys, we have found, we did the largest study of millionaires

ever done in North America. We ended up studying 10,167 of them. 80% of them are married. Only 46% of the public is married. So millionaires have a propensity towards being married. And of the millionaires that we studied, the vast majority are married, and the vast majority say my spouse and I worked on this together. My spouse was my teammate, not an impediment towards wealth building. We agreed to some level to where we were all rowing the same direction. Heading in the same way.

The boat goes a lot easier when you're doing that. And we're on the same page and my spouse was a blessing. And those kinds of comments are all through the notes on this research. And so that's what we find. It's a high database. The data says it's a higher probability of building wealth in those situations. Michael's in Madison, Wisconsin. Hey Michael, welcome to the Ramsey Show. Hello Dave, hello Rachel.

I have, well, I'm a father of two kids, wife of a stay at home mom and we're currently living in an apartment and I'm trying to figure out how to possibly afford a house. And I looked at your website and you said 25% of your income, your take home pay, which means in our area about $90,000, which is non-existent. So I just wanted your input with that. Okay. So you, what do you make? $90,000 before taxes.

It's about $4,200 a month take home. There's something wrong. $90,000 is a long way from $4,200. $4,200 is $50,000 is a long way from 4200. 4200 is 50,000. You don't have $40,000 coming out of your check a year. I've been putting in 8% of my paycheck into retirement. The take-home pay we're talking about is take-home pay after taxes, not after your health insurance and not after your 401k and not after your car payment that goes to your credit union and all that.

No, it's, this is actual after tax income. Which in your case would not be 90, but it would not be 50 either. It would probably be about 75, like that a beer 75 to 80 75 probably would be your take-home pay that yeah so the 90,000 is what my work says I'm getting pre-taxes I know and so your after-tax income would be about 75 thousand a year got it okay which considerable more than forty two hundred dollars a month okay so that that was one misunderstanding the other thing is this

okay you live in madison wisconsin which as you know is probably the most expensive city in the state it's a beautiful city and uh... lot of picturesque things there, a lot of character, but it's very expensive. And so, now the urban growth theory that I learned when I was in college getting a real estate degree says this, that not counting mountains and water, if you drop a pebble in the middle of the downtown district and rings go out like on a pond,

the further out on the rings you go, the cheaper the real estate gets. In other words, the further out in the country you go, the cheaper it gets, right? Sure. Again, the exception would be if you land on a beach, all of a sudden it shoots up. Or if you land on a lake, it'll shoot up. Or if you land on a mountain, it'll shoot up. But other than that, generally speaking, and none of those things should be a problem at Madison Might be a lake problem, but that would be it, but I mean you're generally can go 30 more minutes out of town and the prices go way down agreed

I've been looking and I already drive 30 miles 30 miles one way and the home prices are still around 350,000. A lot of people commute in Madison. So it's a tough area. It's a tough market to live in. Yeah, I don't argue that. The thing is this, just because you live in a tough market or an expensive market doesn't give you a pass on math. Math's still gonna kick your butt. And so you've got to make decisions that are good for your family long term and not rationalize. Because I've taken this exact call from people from California for, I don't know, 30 years. Dave, your stuff doesn't work in California. And I went, no, your stuff doesn't work in California. That's the difference. I mean, some people can't afford to live in New York City.

So you guys have made a decision for your wife to be at home with the kids, good decision. I love the decision, but it brings your household income down obviously. And you're making a good income, but you're not making serious double, triple the national average or something, and you're in an expensive area So you also can't afford to live in Tokyo London or New York City in Manhattan

Because you don't make enough and So those are expensive real estate markets a lot more than Madison even so The county that Rachel and I live in is the 11th wealthiest county in the nation. Not everybody can afford to live in Williamson County, Tennessee. It's freaking nuts. And the cost of living, the cost of housing here is just bizarre. So if you, you know, it's one of those things that you cannot leave Nashville. You gotta go past this county for it to start to go down.

And you go two counties south of here, you can get cheaper housing. But then you're looking at an hour drive into Nashville, or an hour and 10. Yeah. And so that's the kind of stuff you have to do if you wanna do it today. Or you can wait a while and let your income come up.

Yeah, and while you save for a good down payment, and it's just gonna be a few few more years and two, you know, it doesn't even have to be a single family home. Like we know a lot of people, townhomes are great if there's a newer development, you know, and they're doing townhomes like. Jordan Whitney's first purchase was a townhome. Yes, it was. They sold it and bought the next house and made a lot of money on it. Yeah. Yeah. So there's ways to kind of stair step it,

but it does take a lot of patience and it. Yeah, yeah. So there's ways to kind of stair step it, but it does take a lot of patience. And it is frustrating, Michael. I mean, like I hear you. And we have felt that especially in the last probably three years or so when the housing market has boomed and that bubble wasn't really a bubble. It stayed, you know, the housing prices

didn't ever really did come back down. So it is, yeah, and it is tough, but it just means more patience and the fact that like your expectations are gonna have to shift because that's just the reality of the market. Yeah, exactly. You're gonna make a decision at some point.

Somewhere to get your foot, your toe in the door, you know, your foot in the door. Somewhere you're gonna make a decision to do that. And that may be a fixer upper, it may be a townhouse, it may be moving even further out yet. And those kinds of things get you started in the housing market. But I'm not going to ever tell you to do something that brings you harm, and buying a home you can't afford will bring you harm.

It is not a blessing. And so all real estate purchases are not good. All real estate is good and does go up, but not all purchases are good because they don't fit in your life. They don't fit in your numbers. And if you squeeze your whole house down to nothing and your wife has to go back to work because you bought a house you couldn't afford and that you didn't want to do that, then you've traded your values for this purchase because you rationalized the purchase of the house. So well, it's too expensive here. I can't do it. And I don't want that for you. I want

good things for you. I want blessings for you. I want 10 years from now, you'd be glad you follow the stuff we teach. And 100% of the time, this works. So, good question. Mark is in New York. Hey Mark, welcome to the Ramsey Show. Hi Dave, how are you?

Better than I deserve, what's up? So, I just wanted to ask you, at what point do you, do you have a car to be a money pill? Like at what point do you just say, you know, this isn't worth repairing anymore. I'm just going to trade it in and get a new car because it's just worth more to me at that point. A different car, not a new car, right? Correct. Not like new, new. I mean like pre-owned. Yeah, new to you. Okay. Well, what's how, what's the car where you're driving worth? It's the trouble. Um, well there's a oil leak.

The last time I took it in for a multi-point inspection and it's got about 135,000 miles on at this point. So I'm going to be soon replacing the, or sorry, flushing the coolant and stuff like that. But I'm just wondering in general, I mean, what is the car worth that you're driving honey sorry I think it's about 12,000 right now okay there is no time mathematically that a car that is though that value is going to cause you to sell it because of the repairs. Okay, but it may reach the point that you can

move up in car a little bit just to get rid of the hassle. But so in other words, let's say you bought a $20,000 car and you paid cash for the $8,000 difference. Okay, in order to get rid of something that's nickel and diming you to death. You got to do a lot of nickel and dimes to get to cover that eight grand upgrade. And you'll never get there mathematically. You're not going to spend eight grand on this car.

But you may want to do that and have the money to do that just to get rid of the things that had come problem. I'm just tired of burning calories screwing with the thing. You know every time I started I'm just happy it turned on you know. Yeah I get that. Yeah and so but that's not a money thing that's just a hassle thing and I've got the money. Do you have the money to move up? Uh not at the moment I just graduated from college last year, so I'm just building my emergency. Okay. Then you're driving this car right now.

Period. End of story. We're not moving up with that. Period. So save your money and move up when you can. And in the meantime, fix a car. Speaking of real estate, in a difficult real estate market where things seem to be higher than you can handle, you need a pro in your corner, someone that knows what they're doing, not someone who got their license three weeks ago and

happens to be your aunt. That's a bad idea. No, you need to get an actual pro that does hundreds of transactions, that knows what they're doing. We have vetted pros in the real estate world all over America for years, and we only put the high octane, high protein real estate professionals in the Ramsey Trusted program. If you want to find a local Ramsey Trusted real estate pro for free, you can find out who we're saying is good for selling or buying.

Go to RamseySolutions.com slash agent and you'll be glad you did. Mary's in Lexington, Kentucky. Hey Mary, how are you? Hi Dave, thanks. I'm great. How are you? Better than I deserve. What's up? So I'm calling, my husband has become the executor of his brother's estate and he was, his brother was permanently disabled about a year ago and he was sued by a credit card company while he was still alive. However, in the time that he was sued, he passed away. So now we are trying to figure out now that he's the executor, how to go about negotiating with the credit card companies. We did not think there was any money left,

however once he passed away there is a very small 401k that will be going into his estate. How much? 25,000 of course you know that's... And he was not married? He was not married. Did he have any other assets? No, his other assets his home was sold about a year ago because he did go into a nursing home He was permanently disabled So that was all so on the plus side of the balance sheet the only thing over there is 25 grand Yes, correct. Okay, and how much debt is there the credit card was $11,000 any other down no that's it what do you what about what did he have a car no car okay all right, when you pass away, what you own stands good for what you owe. So technically speaking they would get $11,000. Okay? However, it's in default and if you, what I would do

is I would call them and send them a copy of the death certificate and tell them to open a file and say the estate is basically there's basically no money little to no money in the estate if you will make me an offer to settle this $11,000 I will write you a check. Okay well here's the problem who the bank that he owed we had spoken to them and let them know what was going on. They discharged the credit card off of their record and I guess sold the debt.

Yes. So and then we had gone to court because they did file a judgment against him when he was alive. And then the letter was written that he didn't have any money, so the bank just dismissed it without prejudice and I guess sold the... No, the bank doesn't dismiss anything without prejudice.

The court might have. The court dismissed it, but the bank sold the debt. Yeah, I understand. So who owns the debt now? Well, I don't know. Well, call the lawyer that was representing the debt. Find out where the debt went. That's great news, by the way. Bad credit card debt sells for about a nickel on the dollar on the secondary market okay and so they probably bought this for five or six hundred bucks okay so should we attempt to negotiate with whoever they don't know find out who actually owns the debt and settle the debt okay he has to do that in order to clear the money

otherwise the money is going to be sitting in limbo. Who's the heir? He is the heir. Okay well you got $25,000 to settle against $11,000 and you just call them up and settle the debt and put the rest of the money in the pocket and close the close the estate. Okay. Perfectly legal and perfectly accurate. Huh? Two weeks after they discharged it I was surprised that it was sold that quickly. I just didn't know if it was legit or not. You act like that this is this is an industry and these debts that go bad or debts that don't go bad are widgets thousands of them coming off the conveyor line every 10 minutes.

There is zero emotion involved. It's a math transfer for them. The only emotion is you guys. Okay, sure. Yeah, they buy this stuff for almost nothing. I'll give you a crazy example, okay? Two years ago, we decided that one of the things we were going to do to celebrate Christmas We went to one of these debt buyers and we bought ten million dollars worth of debt

For two hundred and fifty nine thousand dollars two and a half cents on the dollar Okay, and it was it was eight thousand accounts And we have a thousand team members and their Christmas present was they each got to call eight people and tell them their debt was forgiven in Jesus name and so that was our that was a most fun Christmas we've ever had it was a blast you know and so but we bought we bought that debt and it was old credit card debt old car repo debt and old medical debt

and the people on the other end, they thought we were calling to collect, half of them wouldn't even answer. And we were calling, we had to call, we had to do all kinds of stuff to get ahold of them to tell them their debt was forgiven and then we'd send them an email saying it was forgiven because we became the owner of the debt at two and a half cents on the dollar. Okay. So that's how cheap it is. It's just a standard transaction. And let me tell you that out of that 8,000 accounts, one of them was probably sued two days before we got it.

Oh. Just like you. It's like a computer batch download. It's not an individual one-off thing. They just batch them all together and it's like baling hay in your one straw. And then sometimes these companies end up selling to other companies and it gets moved around four different times too, right? So it's just... Yeah, different companies like different kinds, these debt buyers like different kinds of debt to buy.

But the truth is they almost never collect it, that's why it's so cheap. And so these guys are going to work with you if you can ever find them. They'll be happy to take a couple thousand bucks out of you. cheap. And so these guys are going to work with you if you can ever find them. They'll be happy to take a couple thousand bucks out of you. Happy to cause they just made serious money on that one account and it's a, it's a good move. So it's a lot of fun. It's a lot of fun. Not really, but you're going to have to dig through it. But the thing that Rachel, that if you're out there listening, I discovered this not only

when I went broke 35 years ago, but then I worked with, and our firm has worked with tens of thousands of people. And when you get sued by a debt collector of some kind, whether it's a credit card collector or whatever, in your mind, you're going to go down and there's going to be like a jury trial and there's a be like a jury trial and there's a hangman's noose outside, you're gonna get hung after, you know, you're gonna have like something in the Wild Wild West

or Matlock is gonna come in and be the prosecutor or whatever, right? We have all this drama in our heads and when you go down to a credit card lawsuit against you and you actually stand there to start with there'll be like 5,000 of them on the docket and there'll be two people standing there and you're one of them then you're gonna realize the judge is just processing this like bailing hay and it's it's a it's less drama than traffic court when you go for a speeding

ticket but in our minds we get all twisted up and my heart rate is up and I can't sleep I've been sued I got served by the sheriff's department and we have all this drama in our heads and you go down there and it's really disappointing There's just not much to it it's it's like freaking boring and kind of automatic and really really fast So and you got that you mean I lost sleep for a week over that And so go go deal with your

stuff and get it cleaned up everybody our scripture today Proverbs 18 15 the heart of discerning acquires knowledge for the ears of the wise seek it out. Two things that seldom seem to go together are genius and common sense. Thomas Sowell said that. Paula's in Milwaukee. Hey Paula, welcome to the Ramsey Show. Hello, thank you so much for taking my call. Sure, what's up? Well, I am a 59 year old widow. My husband passed away four and a half years ago. Um, back when he was alive, I was very proud to manage the

money and a business that we had. We did well when he passed away. I had zero debt. Um, however, um, I lost my mind and I really didn't pay attention to my finances at all and, uh, I coasted and net result right now is I have over $47,000 in credit card debt and I'm just I have home I pay $1,200 a month in in for mortgage I would say if I were to sell my home I probably have about a hundred and seventy five hundred eighty thousand dollars in equity and I do

have a small amount in in retirement which is thirty five thousand by the way like last year I took out twenty five thousand of that of my retirement to pay down credit card and it's Incredible to me that it just within that year's time just shot right back up I'm just I don't know what I is there anything I can do short of selling my home to To regain this. I'm just I feel like I'm just starting to come back out of my fog Any help you could provide, I would appreciate. Sure.

What do you make, hon? What's your income? Well, that's another bad thing. My income dropped to 50 grand this past year. What do you do? Well, I'm a salesperson, a traveling salesperson. Right now, that's what I do. I used to be an executive director of an organization.

I used to have my capacity was much, I used to be able to do much more than I feel like I can do now. If you saw, I don't feel like I can live up to my resume, we'll put it that way. Why? Like I said, I feel like I lost live up to my my resume we'll put it that way. Why? Um like I said I feel like I lost my mind if somebody put a spreadsheet in front of me in terms of like a P&L statement I I would I think I don't know I I I don't think I can

function as clearly as I used to. Sounds to me like you're grieving. Yeah, he was a great guy. Your heart's been broken and I understand. So what I would do is, okay, Larry Burkett, a guy that taught me a lot about this stuff, says that financial problems are seldom the problem, they're usually the symptom. And so let's pretend for a second that your income going down and your spending being out of control are symptoms of your broken heart. Yep.

Would that be fair? Did I hear your story right? Yes, you absolutely did. Okay. All right. Then to fix the financial problems and the income, we have to heal a broken heart and that means that you need to sit with someone who is professionally trained to help you with grief. Called a therapist. Okay, all right. And when your heart starts to heal, your mind fog is gonna clear and you're gonna live up to your potential and you'll quit overspending and being chaotic because it's not who you are. Because I think I heard something else in there Rachel, I might be wrong, but I think I heard he was good with money when he was here we were good with money and I was responsible and I kind of think you feel

a certain amount of shame well I definitely feel shame but it's actually the other way around I was the one way around. I was the one responsible with money. I was the one who I completely went back. Well that makes it even worse then, right? Yeah, exactly. I just, mentally I feel like I lost it along the way. So I don't, I want you to have the sunshine come out again. And your confidence will come back with that. Your competence will come back with that. Yeah, because I don't believe you, Paula. I think you're smart.

And if there were a spreadsheet in front of you, I understand you've lost almost the confidence of feeling like, am I good at this anymore? And I think you are. I think that that hasn't been lost. I think that there is a layer of this grief that's blocking that. Exactly.

But I think that's still in there for you. And so I think, you know, looking ahead and saying, okay, I have five good more years of work in me. I have a prediction that you're gonna make more money in your 60s than you've ever made in your entire life after you find some healing. I need to hear that. And I think you're gonna walk with a certain amount of swagger. So in the meantime, I will tell you like in the last month, my credits, by the way all my payments are

on time, but it just took a real nosedive this last month. I don't care. And well what do I do? Like what's my money? You need to chop up the stinking cards. Yes. And cut them up right now when you get off the phone. And throw them in the trash. Or light a candle and have a plastic surgery party.

A plasectomy. This is the day that Paula's life turns around and goes the other direction starting right now. Ready set go and then we're going to give you every dollar the budgeting app that will walk you through step-by-step exactly what to do not only budgeting but towards getting out of debt. You're going to

list these debts smallest to largest you're going to work like a maniac you're going to sit with a therapist and the Sun is going gonna come out and your income is gonna double next year okay and then you're gonna get out of that really really fast because your problem is not that you can't get out of debt your problem is you keep going into it well I mean it's got a stop doesn't know it's got a stop right there's a lot of reasons but it's got to stop. It's got to stop. It's got to stop. There's a lot of reasons, but it's got to stop.

Yes, I agree. We have to reverse this trend right now. If we bought this company, we'd do a turnaround on it. Yeah, and I think, Paula, in the meantime, month to month is what I'm hearing you say, is you have to get your income up. So whether that's your primary job or doing a side hustle, doing something,

because if you can throw an extra $1,200, $1,400 at this, that's going gonna give you some breathing room yeah exactly and you're in sight you're in sales one month of sales turns this around when you get moving again when your energy comes up and your enthusiasm comes up and your eyes are lit again instead of dull and you know you know what it's hard to buy from a salesman that's this down. No, it is.

Yeah. And a, but a salesman has got the world by the tail and is grinning and watching the sun come up every morning. Like I'm going to get it. I'm going to get it today. You, you, that's the one that goes and makes some money and you can serve your customers in the process and get them a lot of the good stuff you're selling. Yeah.

And Paula, just know like nothing like nothing is broken in you, right, like your reaction of what you've done. You're not bad. Yes, is understandable, right? It's very normal. Yes, so there's just this. It just sucks and we don't want that for you. Now it's going backwards, right,

and feeling like you have to clean up all of that. It's not fun, that part isn't fun. But just know that you have the ability to do this. You've done it before. You were great with money. You said we had no debt and everything. And you were great with income. And a tragedy moment happened in your life and you slipped for a few years and so now it's going to take more efforts to get to the other end, but it's not impossible. It's totally possible.

Yep. And you're going to do, and we're gonna help you. Okay, so what we're gonna do is, Christian's gonna pick up and I'm gonna set you up with one of our financial coaches as a gift. You're not gonna pay a thing for it, okay? And we're gonna give you every dollar of the premium, which is gonna walk you through putting together the budget and then exactly what to do step by step by step by step.

And because the book that I read and believe says we're supposed to take care of widows and orphans and you're on that list so you got us in your corner we're cheering for you if you need some more help you call me but next time you call me I want to hear that you've met with a grief counselor and met with them regularly but so that they can give you a good hug and start this whole thing and turn it around. You got this kid, you can do it. Hang on, Christian will pick up, we'll take care of you. That puts us out of the Ramsey Show in the

books. We'll be back with you before you know it. In the meantime, remember there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.