The Ramsey Show - App - Building a House vs. Buying One (Hour 2)

Episode Date: July 7, 2022

Dr. John Delony & Rachel Cruze discuss: Paying for law school, Making payments for a cell phone, Building a house vs. buying a house, How to get started budgeting. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

🎵 Live from the headquarters of Ramsey Solutions in Nashville, Tennessee, this is The Ramsey Show, where America hangs out to have a conversation about your money, your life, your relationships, just about anything and everything. I'm John Deloney, joined here by my good friend Rachel Cruz, and we're taking your calls at 888-825-5225. That's 888-825-5225. Let's go out to Amanda in New York City. What's up, Amanda?

Hi, guys. How are you? Thank you for taking my call. Good. How are you? I'm all right. I'm looking for a little bit of advice. I think my situation is a little unique, but trying to look for a little bit of color. So I work full time at a law firm, and my boss posed the idea of applying to law school and inheriting the firm in the event that I was accepted. So I was recently accepted. And so now I'm trying to deal with payment of tuition. I'm also fortunate in that my boss is funding half of the tuition. And so it's my responsibility to fund the other half. My husband and I were in the middle of baby step two when I got my acceptance. And so we paused the baby step to try to cash flow as much of law school as we

could. But we do still have some student loan debt from previous, from my undergrad. And so I'm trying to deal with the guilt of the possibility of having to take on additional student loan debt while also still trying to balance what seems like a really great opportunity. I don't think those things are mutually exclusive. Okay. It is a great opportunity. It's pretty cool. Your boss clearly sees something in you and is willing to put his money where his

mouth is, right? Right. There's very few things more flattering than that. I think somebody telling you, you're my person and I'll spend the rest of my life with you is really flattering. And a boss that calls you in and says, I see so much in you. I want you to go get extra training and I'm willing to foot part of that bill. That's awesome. And I was a Dean of students at a law school for a long time. And the law school debt is crippling and the panic and the anxiety and the frustration and the movements professionally that happens makes me tell you, do not go into debt. And it can still be a great opportunity and not the right time for this great opportunity. And if your boss says, well, it's now or never,

then he's giving you a hint into his character in a way that you may not want to tether yourself to him for the next four, five, ten years. If he says, absolutely understand, circle back to me, and you and your husband get really intense and save up the cash, because I think a law degree is one of the single greatest credentials you can have. I think it's a super valuable thing, and I'm in awe of people who go through that process.

I just wouldn't borrow money to do it, and I know that's hard, what I'm saying. I know that. Yeah, it's definitely like a hard pull to fall only because my husband and i are in our 30s i'm going back like a little bit later in general and so how much longer do you have left amanda i shouldn't started yet i haven't started oh you haven't oh i think such in the moment i'm sorry here's here's what i know i'm supposed to be starting in August. Did you get into an Ivy League school? No.

Okay. I'm going to a local school. It is private. I was given a partial scholarship. So the entirety of the bill between the two of us is $30,000. He's paying for half of that, and I would be responsible for $15,000. My husband and I, after buckling down cash flow, or seized up enough cash flow, half of that.

And so I would hypothetically be taking out a loan for the balance. Yeah, I wouldn't. I just wouldn't do that. I'd rather say, one, go in and defer your admission, which I don't. Outside of an Ivy League school that's just got an incredible admissions pressure, I don't know a law school that wouldn't defer in this current climate. The tables have turned at most law schools where they're looking for students. When I was trying to go to law school back in the day, I was thinking about it. It was very, very few seats and a lot of students, and that's flipped. And so you can go defer your admission for one year and tell your boss, man, I'm all in. I love this idea. It's just not financially feasible for us. My guess is he's going to say, what's it going to cost? And if you've got some skin in the game,

he may meet that. Otherwise he may say, cool. And say, we're going to make this work in the fall. My husband and I are going to save up a bunch of money and we're going to go forward with it. And if he asks you, you can say, we just don't do debt in our house. And if he's got a visceral response, that's negative to that. I think that gives you a long-term picture of who you're working for, quite honestly. Who's going to, and it's just, he's looking at one of your values and saying, well, that's stupid.

I'm like, and I just don't know if he's going to do that. I don't think he's going to. I don't think he's going to. I think he values you a lot. And Amanda, do you, how does that hit you though? Waiting a year, just say all of that worked out, right? You're able to defer, save up the money, and have it to go in a year just say all of that worked out right you're able to defer save up the money and have it to go in a year what does that what does that do to you i just don't know if within a year you would be able to save that amount of money because over

the course of i'm doing a part-time program because i would be working full-time and going to school part-time. And so it's four years versus three. And I just can't be saving what would be $40,000 in a year. Yeah, but after that, I mean, you're talking about raises, you're talking about externships where you're going to get paid. I mean, there's all different ways, especially once you get out of your 1L year, there's ways to get part-time jobs. I mean, there's ways to make this work with additional resources

you're really struggling to get through the first year and a half if not two years and then after that the game changes quite a bit how old are you? we're 32 that's the other that's the other addition so I told this story

in my latest book here. My wife was talking to a couple of friends who were, I think they were 35. And both of them, they're all hanging out. And one of them said, you know what? I really kicked myself because I should have gone to law, I mean, to med school. And this person's spouse said, me too. Like, that's my dream to always go to med school. But we're 35 and we won't

be actually out practicing medicine on our own until we're 42. And my wife, who's very, very wise, said, that's not the question. The question is, you're going to be 42. The question is, do you want to be doctors when you're 42 or not? So I would tell you is you're going to be 36. You're going to be 37. Do you want to be a lawyer when you're 37 or not a lawyer when you're 37? That's the real question. And if you want to be a lawyer when you're 37, take a year, work like crazy, have your husband pick up a second job because this is a family shift. And you know as well as I do, law school's really hard on everybody, right? So that when I'm 37, I'm going to take the back two-thirds of my life and be an attorney

and go help the least of these or do whatever we're doing with our law firm. Does that make sense? Yeah. It's real, real easy. It is. It's so hard. It's so, so hard,

especially when it feels like I've got a deal that I've got to move on right this second or it all comes down. Yeah. If you're backed into a corner that way, I'd let the deal pass. That's it. You never make really good decisions when you don't have a lot of options. And it's like it's either now or never.

You're going to make bad decisions in that. That's right. So just take a breath. And I think it's going to be okay. I think it's going to force you to ask different questions and to maybe engage in conversations that are uncomfortable, but it's worth it to do it

so that you don't tackle, you don't put all this debt on you guys here in the next few months. That's exactly right. I think you're going to end up in law school and you're going to do great things and you're not going to owe anybody anything. We'll be right back.

In an uncertain world, being a good steward of your money is more important than ever. While some circumstances can't be controlled, there are items within your budget you can take charge of, such as your health care costs. For nearly 40 years, Christian Health Care Ministries, or CHM, has provided a budget-friendly means of sharing for medical bills when our members need it. Learn more by visiting chministries.org budget. That's chministries.org slash budget. Christian Healthcare Ministries is a Ramsey show 888-825-5255 i'm john deloney joined here by rachel cruz rachel we got a event coming up tell us about it yeah we're excited about this um it's crazy just the real estate market right now i feel like so many people are talking about. There's so much doom and gloom and people are thinking, oh, what's going to happen to the housing prices? But we here at Ramsey like to focus on facts,

not feelings. We like to look at the data of what's going on. So next week we're doing a free real estate reality check live stream. So it's a one night special on July 14th. George Camel, myself and Dave Ramsey, we're going to help you understand how the market actually works and then how to navigate it right now. So we're just saying right now from what everything looks like, it's not going to crash. We're not going into a deep, deep depression like some people are saying on TikTok and Instagram and the news. So we're going to show you the facts behind it and why it's actually still a good time to buy and sell. So don't miss this event. Again, it's Thursday, July 14th, next Thursday.

And you can register for the event right now for free if you go to RamseySolutions.com slash reality check. RamseySolutions.com slash reality check. I think it's important to put a pin in this real quick. Let's say you got in a car wreck when you were 15 and you were making a left turn and you were stopped at the intersection and somebody just t-boned you. Your brain, which is a prediction machine and a threat detection system. That's what it does. Anytime you move into a left lane to make a left turn in an intersection, your heart rate's going to go up a little bit.

Your body remembers this moment, and it remembers. We got T-boned here. We got look out, look out, look out, right? And even though everything's fine, right? And you're going to start, your stress response is going to kick in for you to defend you because your body remembers this. Why do I tell you that? If you lived through 2008 and 2009, we remember this. But more importantly, our bodies remember this.

How scared our parents were, how all of a sudden home prices dropped off. The news is, that was really what I feel like the doom and gloom news kicked in and became a sensational thing. And so as we're getting into, yeah, maybe we're heading towards a recession. The stock market's all crazy. Everybody's struggling with finances. Inflation's out of control. Our bodies are moving.

And it starts saying, look out, look out, look out, look out, look out, right? And that's where I think this event is so important because the antidote to that is facts, is truth, right? Is actual data, not following that fear into the middle of the intersection, assuring that you get in a wreck, right? Right, absolutely. So most of us have been through this before. It's when you've got to step back. Jocko says you've got to detach, right?

You've got to exhale and say, okay, what is the data? What's this real situation look like? What's it saying? Yeah, and there's just something about that panic. And, oh, because you know me me i love a good conspiracy theory so even those you know it's like oh my gosh what's gonna happen you know and you kind of are you're in it and then you're kind of freaking out and you start making decisions in that world and in that mindset and it's like no you can't do that you can't do that you have to look at the facts of what's going on and in a weird way the facts are not as exciting and ooh, crazy.

There's not major big talking points of how exciting the actual facts and the data are. When I mean facts, I mean how many homes legitimately are for sale. Legitimately, how many new homes? What does supply and demand look like?

How many buyers are there? Yeah, this is facts. So we're going to give it to you, but it'll be great. And it's just a good, to bring you hope too in this time. That's right. It's all about hope.

Yes, it's okay. We're going to be okay. Yes. Our price is higher than they were in 2019. Abso-freaking-lutely. Yes. So what are we going to do about it? So what are we going to do about it?

I'm glad y'all are doing this. I'm glad y'all are just bringing some facts and some data and some peace to this madness, man. It's so good. All right, let's go to Julie in Raleigh. What's up, Julie? Hey, guys. How are you doing? Good. How are you? Doing great. First of all, thank you for changing our financial future. I really appreciate all the help you guys give. Today, I wanted to ask about cell phones. We are thinking of upgrading our phones, possibly in the fall,

and there are some specials going where you essentially get a, I'm going to call it a free phone, and they will add that payment to your bill over three years, but then they give you that same amount back as a credit over that same period of time. Instead of us shelling out $1,000 per phone, is it okay to just get that free phone over the period of time if it's not costing us anything? What's the credit back? Say that again.

They'll charge your bill each month for the phone for, let's say, $25, but then they credit that same $25 back on that same bill. This is their way of accounting. Two things here. say $25, but then they credit that same $25 back on that same bill. Okay. So their way of accounting. Two things here. First one is anytime there's a scheme like this, which is what it is, right? I always want to know what's the longterm play. So we know a company whose business is making money.

That's their job. They are not going to give away a $1,000 cell phone because they're nice. So what will they get by, quote, unquote, giving you a free phone or basically loaning it to you for three years and giving you a fake charge and a fake credit, a neutral credit? What are they getting in return? Our service for the next three years. Plus what?

At the end of this three years, you're going to look down and you are going to feel so good because you have earned, through your hard work and dedication, another three-year contract with him in a free phone. See what I'm saying?

Mm-hmm. So what I would say, there is no free anything. It's always going to come at a cost. And so I want to know what am I get? What, what are they getting out of handing me a thousand dollar computer? That's number one. Number two is I have an aversion and I don't, Rachel, you can talk to me more about the Ramsey policy, but I have an aversion to anybody who is trying to, quote, unquote, own me down the road. And so my funny story is I walked into, I think I was an AT&T customer at the time,

I walked in and said, I need to get a new, I'm going to be a new customer, and they started automatically enrolling me into this program where, you know, I said, I want to pay cash right now for this phone. And it took three different people. And finally, one guy goes, nobody's ever done this before. And he's like, can you just roll it into the payment plan? And I said, I can't sleep at night knowing that I owe you money for this depreciating asset in my pocket.

Can I just pay you a check? I mean, pay cash for right now. And they figured out they finally took my money to their credit. They took my credit. They in my pocket. Can I just pay you a check? I mean, pay you cash for it right now. And they figured out, they finally took my money to their credit. They took my credit. They took my money, but I can't sleep knowing that I owe somebody money. It drives me crazy.

So I, personally, I opt out of the system. Yes. I don't know. Yeah, and that's what I told people. Just buy it up front. Do you have the money, Julie? Yes. Yeah, I just buy it.

And you don't have to think about it again, and you're not kind of stuck playing that game of what John was even talking about, of this and this and this and this and this and this. So for me, I'm like, yeah, buy the phone. Just get the phone. It's yours, and then you're with them in your contract for three years,

or even if you want to opt out. It doesn't mess anything up down the road. So yeah, anything that's going to be tied down, that you're tied to them in the future, is what they're wanting. So yeah, I would just pay for it, Julie. Or if their service interrupts or something goes sideways, there's so many things that happen three years from now. I'd rather just have my phone. I appreciate you. Thank you. And even if that costs me a little quote unquote more money, right? But it would be really hard if you've got crummy service and it's

been frustrating and I think I want to change or their towers aren't working so good or somebody built a building and now the service isn't so great three years later but I've got that credit

on my bill for that free phone if I just keep it I'll just go ahead and have right so now I'm stuck now I'm in the middle of this thing

so it's up yeah I mean it is it's that form of someone owning you to a degree and it may not seem like that big of a deal Julie it may be like oh it's up yeah i mean it is that form of someone owing you owning you that's right to a degree and it may not seem like that big of a deal julie it may be like oh it's just a phone and listen this is the way everyone does it but hey what if yeah what if all this comes true and it's

like you know what man when you just have the freedom to decide even something as small as your cell phone service it's peace at night it's just it's just living your life in freedom complete freedom yeah rachel for me it's become it's almost a rabbit hole for me, but it's just following that thread. Who else has their hooks on me? Like, who else? Who else? Who else?

Who else? Even to the point that Sheila came back and she's like, hey, stop sending four months of money to the electric company, right? Let's just pay the monthly bills. I was like, no, I don't want them to ever, right? Yeah, yeah, yeah. And I went too far, but it was, I don't want them to ever. And I went too far. But it was, I don't want anybody's hooks.

Even if it's as small as a cell phone, if it's as big as a fill in the blank, I just want to make my own decisions. It's good. Alright, we'll be right back. 888-825-5225. Thank you. Hey, forget it. If you're worried about money, it's all-consuming. You wonder if you've got enough money for your bills

or if you can even afford to fill up at the gas station. It's always on your mind, and it's weighing you down, and it's getting in the way of relationships. You're waking up in the middle of the night. This is a scary time. But listen, you shouldn't have to live with that kind of stress. You don't have to.

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It's not. It's a plan. And it works every time. And now is a great time to take the course because we just updated a ton of the content. Plus me and George Camel are now part of it too. All new videos. Decide today that you're done letting money stress rule your life. And I don't know anybody who's not stressing about their money. You can do this. Get started with Financial Peace University by visiting ramsaysolutions.com slash FPU. That's RamseySolutions.com slash FPU. Alright, let's go

to Jeff in Macon, Georgia. Hey Jeff, what's up man? Alright, how you doing? Outstanding brother, how are you? Just fine, as hot as it can be but we're getting by. It is warm outside for sure. Same here Jeff. What's up man, how can we help?

I've been listening to y'all's program here for just a little bit, not a whole lot. And I've got a little bit of debt, not much. But my question is buying versus building. I personally own a property, and I've got a modular home on it that's paid for. It's not a very old one. It's like a triple wide. I guess it's one of the kings of the double wide trailer. But I was looking at buying a new house because I've actually got like, I'm 40 years old, and I've been working at my job for 23 years.

Oh, wow. I mean, that put me starting at 18. And I've got a government job. I work with a municipality, and I've got 10 more years to work. I can retire at 51 1⁄2 is my set retire date. And I'm not saying that I'm not going to work past then but i probably won't work here past then that's when i'll probably start making real money but uh anyway my question is buying a house versus building my house and around here where i'm at houses are i

mean they're higher than what they were but they're not super super high like everywhere else in the world but uh like i said i do have a piece of property. I do have a slab that's on this piece of property that I was going to make, you know, my shop, but I don't mind giving it up for, you know, if I build a house on it, and I could probably be involved in a lot in the building aspect because, I mean, I work for Public Works. I'm a gas superintendent, so, I mean, I know a lot about plumbing, building, electrical, and stuff like that. Okay. So, Jeff, you said you don't have a lot of debt.

How much is not a lot of debt? I've got $12,000. And I'll probably have it paid out probably first of next year. And it's all linked on one car. And I've got a bunch of toys and that was the other thing i was going to ask about is uh i've got bass boats my wife's car's paid for my truck's paid for i've got i do a lot of messing with automobiles like as projects and i've got several vehicles that i could sell yeah okay so how much do you make a year, Jeff? You and your wife

combined? I don't, I don't, my wife isn't able to work because she has to keep our grandkids. Okay. And so it's pretty much me, the sole provider. I make about $62,000 to $65,000 a year. Okay. At my job. And that's my taxable income. do you have any other savings any savings i keep about you know a thousand to fifteen hundred uh just for a rainy day i guess it's probably not near enough rain but i have a lot of sick leave time i've accumulated as you would think i mean being there that long i get one day every year every month month. So, I mean, I've got like $960. The cash, though. Cash. Yeah, cash. I've just, yeah, maybe $1,500 cash.

And are you guys living in the King of the Double Wide right now? That's correct. That's where you guys are. Okay. You know, honestly, Jeff, I don't feel like I would not, I don't feel like you're in a good position to buy a house or to build right now. So, if I were you guys, I would pay off this $12,000.

And that could be selling some of the toys you're talking about that you have, selling all that, throwing it at this debt, but cleaning this debt up, and then saving for an actual emergency fund. So that'll be three to six months of expenses. And then beyond that, start looking at, okay, what do we want the house situation to look like? And so building naturally is always going to be a little bit more expensive, but you can always go and price it out and just say, hey,

if I have a builder come in, and since you're great with trade, you're going to be able to help out. You said, you know, maybe things that you don't have to hide. I could probably build it myself. Yeah. Honestly. So I would look to see, okay, how long is it going to take us to pay off this debt if we're aggressive and pay things off?

How long is it going to take us to get a fully funded emergency fund? And then what's that date? And then have a date in your mind. So maybe let's just, for easy math, we'll just say next July. So a year from now, we can start looking to see, okay, we're going to start looking at the house situation. And so price out some homes in the area right now and just say, hey, here's the kind of homes we like. Here's what we're thinking. And then back out into the math

and say, you know, the way we present when you take out a mortgage is that you want to put at least, gosh, 5%, 10% down, ideally 20% so you can avoid PMI. And they get a 15-year fixed rate mortgage and that payment be no more than 25% of your take-home pay.

And so use that formula to kind of look around at homes in your area and see if there's any home that you're like, oh, yeah, that would be awesome to buy. We like something like that in that area. And if not, and maybe you say, hey, let's price out building, and again, putting in your trade, what you're good at, look at supplies, all of it and just price it out and then it really just becomes a decision for you and your wife to make to say

hey here's what we can afford uh here's what the house would be if we built it here's a home that we could buy a pre-existing home um and you guys make that call then but i would not do that while you still have this 12 grand and no savings okay yeah i could get rid of the the debt tomorrow just by selling uh like it's attached to a camera that i've got and i've i've already had like dealerships is offering me 16 for it that i so i could actually do it if i'm you i do it tomorrow and i'd have four thousand dollars towards towards my emergency fund already okay so like i mean like i mean that and i've got like i mean i'm not trying to be you know i've got grandkids you know and i i use like this this fourth we spent the whole weekend on the water i've got a pontoon

boat and i could i could literally asset and liquidate everything i've got to probably not including the camaraderaro to like 45 grand easy because I've got a 30-foot fifth wheel that's paid for I've got two other boats that's paid for and I was just going to get rid of everything but like the camper in the in the pontoon boat and everything else can go you know Jeff here's what here's what I promise you if you go do that and you get honest about cleaning up your property and you get honest about getting rid of just all these projects and the cars and stuff number one you have a rare ability that most of the people that call the show don't have and that's to flip a light switch you could have a

fully funded emergency fund and be completely debt-free in seven days yeah and i was debt-free until i got the wind and got feeling old and thought I wanted to buy this darn car. Hey, we all made dumb mistakes with our money. It's about getting up and dusting ourselves off and going again. Then you can get serious about buying a house. It would be unethical for Rachel and I to tell you, you know what, you need to go buy a house right now because one thing or two things go wrong on that house and you're going to be in a mess.

So, dude, sell the stuff. And then you're talking a week, two weeks, three weeks, you're completely debt-free, you've got to fully fund an emergency fund. And then you and your wife can sit down and have a fun conversation, which is not what do we have to do, but what do we want to do?

What do we want this thing to look like? What do we want our back half of our life to be, man? And I think that's a whole different conversation than what can we afford and how are we going to squeeze this thing out? But you're in a great position, man. And I promise you, she's going to be real happy without all those cars and boats and everything out on the lawn. Man, you're going to give her her yard back, dude. That's going to be awesome. We'll be right back on the Ramsey Show. 888-825-5225. This is The Ramsey Show.

I'm John Deloney, joined by Rachel Cruz. We are taking your calls on money and on life, on anything else you've got going on. Let's go out to Anthony in Kansas City, Missouri. What's up, Anthony? What's going on? How are you doing? We're doing all right, brother. How are you? I'm pretty good.

It's hot over here. It is making its way across the country here. So what's up, dude? How can we help? Hey, I was just calling today because I'm trying to get some advice on starting a budget, trying to get out of debt. I don't have any clue

on where to start. I downloaded the EveryDollar app and I still don't know where to start on anything. All right, starting from scratch. So, Anthony, what is your situation? How much debt do you have? Do you have any savings? Kind of where are you at?

I don't have any savings. I don't have anything. Like, I own my mobile home. I'm about, I would say about $15,000 in debt. Okay. Including my car. Is that car, credit cards, student loans? It's more like hospital bills.

Okay. And like some cell phone service stuff. Okay. And how much do you make a year? $31,000. Okay. What do you do? I have a forklift for hostess, actually.

Okay. Yeah, yeah. Awesome. Okay. Well, Anthony, I mean, yeah, I think one of the best starting places and what you did, which is great, is the budgeting. When you do a budget, there is this level of feeling completely in control of your money. And for you, maybe for the first time ever where you're thinking, oh, gosh, you know, I don't know. I'm getting my paycheck in. I have no clue where it's going.

And so what you want to do is you want to do it before the month begins. So we're here in July right now, the beginning of July. So you could even say, I'm going to start this in August. So August 1, and you're going to look at your budget for August. You're going to look at your expenses, everything from your, yeah, if you have a payment on the mobile home to electricity, water, food, and you're going to go down the list and every dollar has suggested categories already in that budget. So you may could take some of those out. If they don't

apply to you, you can add some. And then you're going to put dollar amounts next to all of those categories. And the goal is your income for August minus all of those categories, including giving and saving in your case, will equal zero. So every dollar coming in in August is assigned to a category. You know exactly where your paycheck's going. And since you're starting out kind of at a clean slate, your goal really is $1,000 emergency funds. That's your number one goal before paying off debt.

And so you can use your budget then to be your guide to say, hey, what can I cut? Are there things I can bring in extra income? Could I get a side gig at night? How's a way to raise my income? And where can I cut expenses in my budget? Realistically, I'm not asking you to like spend $20 in food for the month or something, right? You want to be realistic about your budget. But it's a great guide to say, hey, here's where my money's going. Where can I cut to get that $1,000 quickly? And quickly, Anthony, I mean, you're changing your entire life right now when we're talking about money. Like if you have not been on any kind of system, any kind of plan, this is a complete mindset shift that you're about to experience. So things are going to be

new. It's going to be uncomfortable. You're going to do things you've never done before. But that's a good thing because you want to start winning with money, which means you're going to do things you've never done before. And so that budget and getting that $1,000, that's your first goal. And really, it's kind of the thing that I always tell people, it gives you a sense of confidence. And the budget will take about three months to work so August will probably be a disaster and that's okay give yourself grace September it'll kind of work October it's like okay by no by by Christmas for sure by Thanksgiving you're gonna say okay I get it like I I know I feel in control and that's gonna be able to guide you to getting that thousand dollars and also start working your way out of debt.

I just did a lot of talking. I did a lot of talking with your, yeah. What questions do you have? No, that's perfectly fine. I definitely appreciate it. So a couple of questions I have is at the moment I'm currently behind on quite a bit of bills. My gas for my house is about $1,000 behind. My car payment's behind about $1,000. How did it get that way, Anthony?

What happened? Because that doesn't happen overnight. That doesn't happen one month. That's two or three or four or five months. Yeah, so I have a terrible spending habit for impulse buying on pretty much every paycheck. So I'll pay what I think I can pay and then I'll be like, oh, I have 200 left. I have to have 200 left for myself for

random stupid stuff. If I'm asking you honestly and I want you to answer me honestly, do you struggle with addiction in any way? No, no. Nothing like that. Totally clean? Okay. All right. So this is purely you're just not disciplined with your money.

Yeah. So I'll go out and I'll buy like a $75 air purifier or some kind of appliance or I'll go out and just random stuff. And when you're doing that, Anthony, is it because it's exciting, because you're bored? What's the why behind that impulse spending for you? I would feel like it's exciting because every time I get money, I'm just like, oh, I have some money I can spend. Yeah. And then I'll just go out and I'll spend it.

Yep. And then after you spend it, when you look back now where you're sitting, all the air purifiers and all the random stuff you've spent, has it been worth it? Is it worth it? No, not at all. Because then I end up either never use it.

It's just a paperweight at that point. I'll use it for about a week and then that's it. Which is human nature, by the way. Everyone does that. We all think if we're going to spend money, it is. Right? John talks about this. I do it too, man.

How the chemicals in your brain, it's exciting. Your body, you get a little adrenaline, and it's fun. And you're like, oh, okay, okay, okay. So that happens to everyone. So for you, Anthony, it's really this moment of saying, you know what? I'm going to be an adult. And there's a quote, Dave always says that adults devise a plan and follow it. Children do what feels good. So there's a level, Anthony,

that it's like, you got to, you have to be a grownup. You have to be an adult. You got to pay your bills. You got to say no to yourself, even when you really, really want it. And so on a very tactical side before this call gets short is I want you to catch up on all of your bills before anything else. And so, Anthony, I'm going to really press you. I want you to get one or two extra jobs. Today. I want you. You have to radically do something different because if you keep doing what you've been doing, you're going to keep getting what you've been getting.

And so bringing in income and then you're cutting everything. And to say, you know what? I will not. I will not spend on this. But you talk about this too, the behavior change aspect though. So look, dude, you've got to put some hurdles between you and this impulse. Rachel and I talked about on a previous show. It's the gap between stimulus and response. I want to go buy this thing. I need to go buy this thing. That's the gap between stimulus and response. I want to go buy this thing. I need to go buy this thing. That's the gap you've got to control because that's what's getting you in trouble. What does that mean?

Take your debit card out of your wallet and leave it at home. Don't leave with it. Make your lunch and take that to work to where that's all you have. And if you forget to take your lunch, you don't eat that day. You won't do that very many times

before you get really hungry and you start making your lunch, make peanut butter and jelly sandwiches or some beans and rice or whatever it is to get to work. Get rid of Amazon Prime. Just delete it. Make yourself have to jump through a bunch of hoops to go

spend money and that will give you some space on your way to jump through all these hoops to say, whoa, whoa, whoa, what am I doing? What is my body trying to tell me? What am I trying to avoid? What am I embarrassed about? What am I ashamed about? And my guess is you work real, real hard and it's annoying to you that you can't just go

get what you want. Is that fair? Yeah, no, that's absolutely true. You bust your butt every day and you do work in the heat and it's hot and it's hard and you're driving a forklift you got a skill that other people don't have and dude I just want to think air purifier and I can't afford it because they're about to shut my gas off

and so the not nice way of saying this is you are broke and you're in a scary position you're about to lose your home dude right yeah yep so as Rachel said, it's time to do everything differently. Right? Opposite. How old are you, Anthony? Opposite, Anthony? I'm 32. 32. Okay. Well, I'm excited for you because I really do. Hang on the line. Austin

will pick up. We'll give you a subscription to Ramsey Plus because that adds in every dollar in the videos. But Anthony, I want you to be radical. I want you to do the opposite of everything you've been doing. I want you to work like crazy and I want you to pay your bills instead of paying for air purifiers. Change it up. You can do it. You can do it. All right. We'll be back for another Hey, it's Rachel Cruz, co-host on The Ramsey Show. If you want to do your debt-free scream live on the show, visit ramsaysolutions.com slash debt-free scream. We'd love for you to come to Nashville and tell Dave your story. That's ramsaysolutions.com slash debt-free scream.