The Ramsey Show - App - Building Wealth Starts With Setting Aggressive Goals

Episode Date: December 9, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Walshaw, Ramsey Personality, is my co-host today, number one best-selling author, and we're here to answer your questions about your life and your money. Open phones at 888-825-5225. Andrew starts off this hour in Miami. Hi, Andrew. Welcome to the Ramsey Show. What's up?

Not too much. Thank you so much for having me, Mr. Ramsey. Sure. So I had two questions regarding whole life insurance. I know your general principle, but I've never actually heard you discuss these two characteristics of whole life insurance or these two scenarios. So I was kind of curious of your opinion regarding this subject, if you don't mind. Sure. I'm an expert on my opinion. So the first question is like this.

Today in America, if a person is a single person is earning $150,000 a year or less, they can put up to $7,000 into a Roth IRA. That grows tax-free. But at $150,000 after taxes, about $130,000, a single person pretty much anywhere in America still has plenty of money. So let's say you're putting money into an investment brokerage account. My question was on whole life insurance,

it also grows tax-free. I know it doesn't have the same rate of return, but if a person wanted to increase their long-term tax-free savings, would that still be, would that be something you would consider as a viable approach that they've already maxed out their Roth IRA or if they have a company that a Roth 401k, the sale can only max out at 7,000. How long ago did you take your job selling whole life? I've actually only sold a couple of policies, but no, I don't.

I'm not actually involved in the industry specifically. How did you sell policies if you're not involved in the industry? I am a licensed agent, but I haven't done it in a few years. Because you pretty much spouted their line perfectly. This is the whole life sales line.

That's how I knew you were selling it. You nailed it. Like you were just trained like three weeks ago. That's what it sounded like. Not picking on you, but you are representative of the industry. Okay. So let me help you with this. Let me help you with this. Let me help you with this. Whole life does not grow tax-free unless you lose money.

And your basis for tax purposes in a whole life policy is the total of your premiums. So if you pay in $100,000 over a bazillion years into your whole life policy and your cash value is ninety thousand dollars you have lost ten thousand dollars and so of course there's no taxation or you can borrow your own money and pay them an interest rate to borrow your own money and by the way one hundred percent of the time borrowed money is not taxable so whole life in and of itself does not grow tax-free that is a falsehood if it actually made money and you took the money out it would be taxable but they never do because they suck so bad the The rate of return is horrendous, and the fees are so high.

And so, no, I would never consider that as an option. Instead, I would, listen, dude, if you put your money in a fruit jar as your side investment after you maxed out a Roth, you're going to end up with more money than you will screwing around with a whole life policy because they lose money i'm impressed that you sniffed that out as quickly as you did too much time in 30 years being hated on by whole life people so that was pretty impressive i'm not gonna lie i i i'm impressed well i mean the the it's a scripted thing that clearly it's a it's a tax-free growth which is a complete lie y'all it's not tax-free growth if there is growth and you take it out

it's taxed period but there never is because the rate of return is so horrible and the fees are so high so so here's the fees are so high. So, so here's the way whole life works for those of you listening. And he's talking about it as an investment only, but let's talk about it as an insurance product, which is what it is purported to be. And that's, you only have to have a life insurance license, not a securities license to sell the crap. So the, which is easy to pass. If you can, if you can roll out of bed, you can probably pass your life insurance exam. It's not that hard. Securities exam, on the other hand, very hard. Now, whole life is 20 times more expensive than the same amount

of term on the same person. So a 30 year old buying a hundred thousand dollar policy, if say, for instance, they did that for $5, whole life would be $100. Okay. So where does the extra $95 go above the cost of insurance? Because term is only insurance. That's right. It goes into an investment called cash value, which is what he was bringing up. Okay. The investment called cash value, the first three years on a whole life policy, your investment growth is zero. 100% of your $95 a month in our example, the extra 19 times you're paying for this, you get zero in your investment. So you open a bank

account and you put in $95 a month for three years and the balance is zero. No one would do that, by the way, if they understood that. They do it all the time, but no one would do it if they understood that. You're right. Which is our goal here is to make everyone understand it. Then once it does start making money, the average whole life policy in America today averages 1.2% with an inflation rate of 4.7 losing money

and so after you get past those two things here's the worst part of the whole thing so this little couple buys a hundred thousand dollar life insurance policy they pay into it for 20 years they have 20 000 bucks in there finally after they got 1.2 percent and has nothing for the first three years and then he dies you know what they pay they pay the life insurance just the premium the face amount what happened to the money I've been paying 95 dollars extra to build up in my savings account uh insurance company keeps it you do not get the face value plus the cash value well let me ask this because let me finish okay so you have a savings account that the first three years you put money in they keep all of it after that you make one percent on it and when you die they keep your money who would open this savings account nobody but people do every day it's the biggest

let me tell you it's the payday lender of the middle class it's crap sorry Andrew but you asked so when do they a guy like Andrew if somebody said I'm interested let's say they had built up a certain amount of cash value when would a guy like Andrew say here's the right time to get at that money so you so you know it's all a risk game but so that you can get it before you die well you can't get it before you die the only way you can get it is cash the policy in because if you borrow the money out then you're paying before you die they repay the debt to yourself to make sure they keep the whole cash value before they pay out the face value so So if you borrowed $20,000 and $100,000 policy, and you died with the loan out,

you get $80,000 instead of $100,000. They pay back the loan so they make sure they get to keep it. Wow, wow, wow, wow, wow. So the only way to get to keep the money is to cash out the policy. And then at that point, why get it to begin with? And you have lost money on it, so it's not taxable. Terrible, terrible, terrible. No, you're better off putting money in a fruit jar, darling.

At least when you die, it's there. Assuming the family knows where the fruit jar is buried. But be careful with that one. That did happen to one of my relatives. We got cousins out there with metal detectors in the backyard trying to figure this one out. Don't do that one either. This is The Ramsey Show. I've been doing this show for over 30 years, and some of the saddest calls I have taken are from situations that are completely preventable.

Yeah, and what's so hard is I feel like one of those, especially the ones that I'm like, oh, it's terrible, are people that call in and their spouse has passed away suddenly, and they don't have life insurance. When you have to think through, how am I going to pay my bills in the middle of all that grief? It's terrible. So life insurance is the one thing, especially as a mom with three little kids that I'm so big on for people to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies. It doesn't cost much.

You just have to admit that someday you're not going to be here. You've got to say it out loud, and you've got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of a stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. Jade Walshaw, Ramsey Personality is my co-host today. Thank you for joining us. Open phones at

888-825-5225. Hayden is in Nashville. Hi, Hayden. Welcome to The Ramsey Show. Hey, thanks so much for taking my call. Appreciate it. Appreciate everything you do. Thank you. So basically I'm calling about my mom. I'm very concerned for her. She has a bad track record for being financially smart. And recently she just got into a relationship. It's only been about six months, and he has a lot of money. So she thinks that she wants to quit her job and live off of his money and then sell her house, and then that's her retirement. So I just don't really know how to give her advice,

and she has asked me for advice. She did ask. Interesting advice she did ask interesting she she did ask okay so because the one thing that changes the whole discussion is the marriage date when are they getting married that's exactly my point as well like i'm telling her you need to get married before you decide to quit your job or decide to move in with him like but is there if you quit your job and move in with somebody and sell your house that's rich that's called a sugar daddy we have a name for that guy he's a really i don't care he's a sugar daddy he might be a nice one but that's what he is no you don't do that mom how did you get to

be mom and not know that trust me i don't know so what have you said to her what have you said to her so far about it what have you told her so far um he wants to take care of her and she you know he supports her in any decision she wants to do if she doesn't want to work anymore that's okay she'll he'll pay for you know all the bills and she wants to sell her car she also has a she has 20 000 on her car right now um 8 000 in credit cards you know she's not good with her money and i'm saying what have you told her about this have you told her anything i told her i told her that one she needs to get married if she wants to rely on his income. And did you tell her why?

Oh, yeah, for sure. It's hard for her to listen to me because I'm not married. Ah, okay, another strand. Well, it's you're her kid. That's strand one. Yeah, and that's another thing, too. Yes, and then you've not been in the type of relationship that she's been in at least that's the way she's going to view it which is true so you're fighting again like you're fighting a current 100 let me tell

you what if you ask your mom's dad he's probably gone right yeah yeah but if we were to ask him a good relationship they didn't know that's probably not a good example if we were to ask him a good relationship they didn't know that's probably not a good example if we were to ask her uncle he would have said no i'll bonk him on the head no right or i mean even if you flip the script and put yourself in that situation although i i would love to think that she would tell you to do the the opposite but she might tell you to do the same thing that she's doing so she would smell that one out um i i don't you know your question is how to convince her of what all three of us know that this is a bad idea okay yeah so i guess the thing is this okay here's the thing anytime mom you're making a great huge decision and there's

a series of great huge decisions you're making here you have huge decision. And there's a series of great, huge decisions you're making here. You have to play out the decision. Is it a happy, happy decision? Now, the way that works is this. You're happy if this works, and you're still happy if this doesn't work. If it all works and you just play house and the sugar daddy takes care of you it worked you're happy that's your plan but what happens if he dumps you in the street for a 10 year younger version trade you in on a new model mom uh because he can do that pretty easily here by waving the exact same carrot he waved in front of you um and be sugar daddy to somebody else so when he puts you in the street with no house, no car, and no job, where are you going to be?

So you don't make big decisions like this, mom, when one of the possible outcomes is devastation, bad risk management, lack of wisdom. And I'm also just not in a position financially to help her she's asked me in the past for money that doesn't enter into how stupid this is right you're gonna you give her money or not doesn't mean this is smart and you're gonna have to accept the fact that she's gonna do you could lay out the best argument in the world like perfectly just eloquent everything makes sense and she could still go and make this choice and it's going to be bad for her and you're going to have to just learn how to live with that and accept the fact that she's a grown woman and she's making a bad

mistake and there's nothing in many ways there's nothing you can do about it and that's I think that that's the hardest part of being in a relationship with anyone that you really care about is they get to choose. Is there anyone in her life that's wise that she trusts? Her brother. Have him call her and scream at her. I'm serious. He really likes the guy, so I haven't seen him, like, acting really towards her. I asked if he was wise. Oh, yeah.

If he's wise, he doesn't think this is a good idea. I'm not saying the guy's a horrible guy. I'm saying this is a horrible deal for your mom. Put a ring on it, buddy. Well, the guy probably thinks, if this is a, I'm going to say in air quotes, a good guy, this guy probably thinks he's offering your mom the world. So maybe somebody needs to get in his ear and make him see, hey, we like you. We think that you're probably trying to take care of our mom, but can you do this the right way? Because this way, the way that you're doing it

now makes us nervous because if for some reason it doesn't work out, she's on her butt, right? So maybe that's the way to go at this is if there's somebody that has the right relationship to talk to him, if he is really the good guy that you guys say he is, that should give him a light bulb moment to go, oh, I get it. Yeah. Right. Put a ring on it. I think my mom just needs a reality check too. Yeah. The problem is she's not looked at the downside. Anytime you're making a big decision, you have to look at the downside. What's the possible negative outcome from this? And it'll keep you from doing some stupid butt stuff if you don't only consider that you know sunshine rainbows and skittles you know it doesn't always turn out sunshine rainbows and skittles especially when the deal is set up poorly from the start you're kind of

asking for it yeah that's true you're asking to have your butt kicked life's going to come along go you was stupid here's your butt kicking ready here you go and we all get to pay some stupid tax we've all done some stupid butt stuff and she's signing up for one here this is a trip it's going to be harsh please don't do this lady please don't do this put a ring on it or don't do it it's pretty simple because i gotta tell you it changes the chemistry well i was gonna say there's no like balance of power in this relationship she sells everything she has there's no way in the world she could live in a house probably that he that he lives in on herself you know what i'm saying she has no ability to keep up life we need to bring back some of the vernacular from bygone eras let me hear it a kept woman oh you ever heard that one yes that's very uh i don't want to say the word old but

that that's that's ancient yeah that's um a kept woman she's being kept yeah for use yes yeah and they give you a little chill gives me a little chill i don't like it. And they give you a little chill. It gives me a little chill. I don't like it. My dad's stuff, my grandpa's stuff gets angry right then, so I just can't. Put a ring on it. Michael is in Charlotte. Hey, Michael, what's up? Hey, I'm good. How are you doing?

Better than I deserve. How can I help? I had a question. My wife and I are in the process of buying a house. We were pre-approved, and our loan officer told us she doesn't advise 20% down payment. We're in North Carolina. She says the appreciation rate in North Carolina. I don't advise you using this loan officer.

She's stupid. Yeah, I figured you would say something along those lines. I have a hard time understanding how that works out. Well, her thing is that borrowed money has no risk, so borrow all you can. Okay. My thing is I've met people who are up to their eyeballs in a mortgage and can't get out. They're stuck because of some idiot loan officer like this.

By the way, she gets paid on what? What's her percentage on the loan amount? Conflict of interest in this advice. Hello. I need more money if you don't put down so much. He needs to go to our real estate hub and find some folks who are going to actually help him. Go to RamseySolutions.com slash real estate.

There it is. That's easy. A whole bunch of stuff there that'll help you,ael yeah but she's getting paid on that you do need a loan officer this woman's not smart this is the ramsey show jade washall ramsey personality is my co-host today thank you for joining us today's Ramsey Show question of the day is sponsored by WhyRefi. When you're trapped in a maze of defaulted private student loan debt, hard to find your way out, but WhyRefi can offer you a lifeline with custom refinancing based on your ability to pay

and a lump sum payoff option you could qualify for after 24 months at a discount go to y refi.com slash ramsey that's the letter y r e f y.com slash ramsey might not be available in all states all rightyy then. Today's question comes from Ashley in Illinois. She says, my husband and I will be debt-free in about three years, house and everything. Congratulations. The house we currently live in is the house that he lived in with his ex-wife. I would like to get a place that is new to us,

that we can create our life together. Is it stupid to get a mortgage when we are debt-free? That's a very good question. The simple answer is no, it's not bad. It's not the worst thing. You could definitely do worse. And the reason that you're wanting to do this, I understand it. I just wonder if you go ahead and you are debt free within this three year time time frame, I wonder what the market will be like. And if there's something that you can just simply say, we're moving from one house to another, you may not have to go into debt.

Or if it's a small amount, I'm not mad at it. I just think that you're really gonna love the feeling of being free. And so when that time comes, you're gonna step very lightly. You're probably gonna be very lenient on the amount that you would be willing to borrow. And I think that that's a good thing. Yeah, it's not, to answer your question,

it's not stupid. It's not bad or evil. We just don't like debt. So if you have the ability to do something in cash, I think that that's a great thing. But I definitely wouldn't go crazy on this. Dave, what do you think? here's what's interesting that it is assumed that I have to move up in-house to move out of her house yeah they might be able to get something move down in-house it's a novel concept so now we're getting to the root of why we really want to move that's good Dave that is listen you're not wrong I saw one with a jacuzzi and a skylight mine doesn't have that they might be willing to consider that because she hasn't felt that freedom of no mortgage yet well so once they feel that these are not necessarily the same thing you could move down in house or you could move

to the exact same price of house and be out of the ex's house which i completely would definitely want to do i would too but you're right there's probably that's like that would gross me out i want out of her house and i also want into another nice nicer better house well i mean moving up in house is one question moving out of the ex's house is another question but even moving there are two different questions there are two different questions but even if she just simply said it like that I personally still would be like listen if you told me you were taking on at that point it's like hey Jade we're we're moving up in house it's going to cause us to take on a hundred thousand dollar mortgage then my question would be like well how

quickly could you save to get that done you have no house payment so when you put it like that and sell it and go rent for two years exactly when you put it that way it's like well it's a small mortgage then if it's a small mortgage you could probably pay cash for it just as quickly so i can tell you once i got out a herd of horses couldn't have drug me back you ain't going back i know that includes a dissatisfied wife ain't nothing nothing nothing gonna drag me back in you ain't going back i know never going back so we might i get you want to move let's just go we'll go rent i get you want to move we're gonna move down we're gonna get this little condo oh yeah where the ex hadn't been i i get the move but you're this lady is asking the same question we get when we have someone say hey i have a ten

thousand dollar paid for car it just got totaled uh i don't really want to go in debt to buy a new car well you don't have to you get the ten thousand dollar check from the insurance company and you buy a ten thousand dollar car but instead you're using the car totaling as an excuse to move up to a twenty thousand dollar car and somehow that equates to payments and you're going to act like the car being totaled cause this no you moved up in car yeah that x didn't cause this it's not that's they didn't cause the move up they caused the move out that's the other question of this i'm like listen if you're if your plan was to go into debt for a mortgage anyway then why are you waiting three years till you pay this thing off what's the what i'm going to move now what's the point that's a good idea too that's a really good that's i like that the

best thing we've said doug is in st louis hey doug what's up hi how's it going thanks for taking my call sure man how can we help okay so i've got some good news and i've paid off a lot of debt and um but i want to talk to you about the emotional side. The guilt is still there. So, yeah, so we had some major medical bills and some home repairs. Found ourselves over $100,000 in debt. We decided we didn't want to pay the minimums anymore. So we paid off a third, settled a third.

And then when my 99-year-old grandma passed away, we got a little money. So with the exception of our mortgage, my wife's two loans and a very small car payment, which we're going to pay off early, we are out of debt. Okay. What is it you feel guilty about? Just still, even if we budget for it, a big purchase, it still feels uncomfortable. Or if you're you know going to

the kids activities and you run out of time and you're swimming by mcdonald's and you're like you feel the occasional purchases it still feels guilty are you doing a budget yes yes is your budget account for those occasional purchases yes are you able to accomplish your other goals with the occasional purchases yes yes um Yes. It just still feels weird. Do you feel bad that you didn't pay? Is it because you didn't use your earned money per se to pay off all the debt? It's more a mixture of, I guess, I'm afraid to go back. And then, you know, I've really drastically increased my income. And so I feel a little like, you little like people who are having a harder time. And then the other part of the guilt is,

so we have a three-year-old and a five-year-old. And because of the medical stuff and because it was just easier with my wife being home. When she's home, we meal plan better. We save more money because we don't need out. We don't save money because my three-year-old doesn't have to go to daycare. We save more money that way. But anytime you go

visit family, friends, anything, it's the first when she goes back. And it's like, well, I've increased my income. I think we'll be okay. They don't get a vote. Who gave them a vote? I know. It's in my head. And I guess what I'm trying to say is how do I get we're doing fine, but how do I get all that voices out of my head? I assume that once you pay off the debt, it still takes a little bit before you feel that relief.

Listen, I'll be honest with you. My husband and I paid off a big amount of debt. And immediately you're like, yes, this debt's gone. But you do feel the residual effects of that throughout like your day to day life. For me, it's I would go to the grocery store. My armpits would still sweat when it was time to swipe my card. Still, to this day, I have to stop myself from checking my account to make sure the money's there. So there's there is that part of it that your body is just used to a certain response when it gets in those familiar circumstances. And I do think that that starts to fade over time.

I think the best thing for me, one of the best anecdotes for this has been, anecdotes for this has been the budget and just going over it and saying, okay, I planned for this. And reminding myself that I'm still doing all of the things that caused me to be a financially responsible adult.

I'm still doing my investing. I am still planning for the future. I'm still doing my investing. I am still, you know, planning for the future. I'm still being generous. Like when I tell myself, Jade, you're checking all the boxes. This is okay. Then it kind of causes my heartbeat to slow down. All the boxes are checked, including taking my wife out to a $300 dinner tonight. Okay.

Well, I'm not talking about that. I'm talking about that maybe i think this woman needs somebody to take her to dinner sounds like and sometimes to dave's point to dave's point i do think you need to bust through those barriers a little bit and remind yourself why you did this why did i pay off this debt there's a so that to it and the so that wasn't so that you could be at home and andting about every small purchase. That wasn't the so that, right? Exactly. Yeah, that's a good point.

And as far as the other people getting a vote, I can tell you there's a high correlation between people that build wealth and those that don't give a crap what other people think. Right. So you pretty quickly go, whatever you want to think about, that's fine. I mean, I got people that want to tell us what to do, but they've even voted wrong for the president. So, you know, I don't even, why do I want to listen to them?

You know, you got to be careful who you're listening to, man. You don't get a vote. You don't get a vote. This is The Ramsey Show. Rachel, do you ever get these sketchy text messages that are like, hey, you need to update your address and verify so we can get you the package you didn't order? Yes, I have, George. Sketchy and never trust them.

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seconds. Are you ready? I'm not. Oh, man, it comes fast. I got to figure out what Sharon's buying herself. I have a couple of guesses. My guess is it involves diamonds. Anything she wants is what it is. It's SWI. Sharon wants it, whatever it is. Whether you're shopping for yourself or you're looking for the perfect gift to help someone get their house in order, their money in order, now's the time to check out the 30% off on our best-selling products, including the Total Money Makeover, the Non-Anxious Life Book, which is a number one bestseller, Georgia's number one bestseller, Breaking Free from Broke, the Classic Questions for humans decks are just 12 all kinds of christmas specials good stocking stuffers and hey guys i mean you can buy an ugly tire you can

buy a book it'll change somebody's life okay hello yeah yeah so click the link in the description on youtuber podcast or ramsey solutions.com slash store. Kyle is in Salt Lake City. Hey, Kyle, what's up? Hey, Dave. I appreciate you taking my call. I messed up big. Went behind my wife's back, racked up 26K and credit card dead in four months.

Pregnant wife, I should say, and now she's filing for divorce. What did you jack up 26K on? Pokemon cards. Trying to buy a bunch and then up $26,000 on? Pokemon cards. Trying to buy a bunch and then sell them online, which didn't work out. Oh. Okay. All right.

She's filing for divorce. Yes. She already filed. Sounds like things were pretty rocky before. Yeah, it's not because of these Pokemon cards. That was just the final straw. Mm- before. Yeah, it's not because of these Pokemon cards. That was just the final straw. Mm-hmm. Yeah, correct.

We have three boys together, two to five, and our first girl on the way, she's 15 weeks pregnant. So what went on before this? What were the straws before this? How have you been behaving? Angry, short, not pleasant at all to be around, to be honest. I appreciate your honesty. Yeah.

So let me ask you, if you were to put her shoes on for a minute, what do you think regarding this purchase that she's angry about? The deceit, the betrayal. Good, good. That's good self-awareness yeah in our world we call this financial infidelity because it's you busted the trust almost as if you slept with someone yeah that's the way it feels It's the same part of the brain that you damaged. Yeah. That's what's going on. And so that's why I pushed her over the top.

And then so the net of the thing is, have you been able to sell the Pokemon cards yet? No, I'm going here. I'm just getting everything together so I can take it to one of the local shops here in Salt Lake to sell and pay back some part of this debt. What do you think they're going to bring? I'll be lucky, honestly, if I probably get $5,000. So how did you mess this up that bad? I'm confused. So what had happened was I was trying to build a platform on social media, so I built an Instagram account where you buy followers,

and I paid a lot of money on giveaways on an app called Whatnot, and that's how I really racked up the debt, was buying these expensive giveaways to try to get people to come to my channel. Okay, so you didn't really buy $26,000 worth of Pokemon. You really spent some of this money on the website. Yes. Yeah. Trying to build a false front. Yes. Look like you're bigger than you really spent some of this money on the website. Yes. Yeah. Trying to build a false front.

Yeah. Yes. Look like you're bigger than you really are. 100%. Did you tell her any part of this? And she said, don't do it, and you did it anyway? Or you just kind of did it all? Yes.

I started at, we were at $4,000, and that's what she knew of $4,500. And then I went and continued. As things were already going a rocky path I felt I just I self-indulged in myself yeah and went all in and on myself out of selfish greed and lust for fame that wasn't real are you in counseling I am yeah she went with me in my first today went to my appointment okay that's good yeah yeah that's point blank i say that because you sound like you're you sound like you're working through this mentally at least it sounds like it in this very short call has she said anything to the effect of here's what i need to see in order

to stay with you or has she just said that's it she did uh i looked up a video from you guys. I saw I came across your number last night, a financial infidelity. She used that word. And I told her, I said, look, I know I'm going to be served papers tomorrow. Next day. So if there's even a chance you'll stay with me, I would burn all these cards right now, work overtime and do whatever it takes. Wow. What'd she say to that?

She said, no, I want to go through a therapist appointment. Good. And the therapist said why should she stay with you i said logically she shouldn't i said she has no room to stand on that she should um and i said but if there's even a chance even if in the end it's worth it to give a chance to my family so let me give you a parallel um and uh we we're not counselors dr john deloney is our counselor but we work with people in these situations and have for 30 years so much that the parallel she's

looking for i'll tell you what go pick up this book by dr henry cloud it's called trust trust trust that's what this whole call is about. Broken trust. And in his book, he talks about how to build trust and how to rebuild trust when trust has been broken. Also recommend it for your wife. Okay. Because it'll give her the correct things, if she's willing, to demand of you that are the right things to demand of you. Okay? Okay.

And it should sound something like this. What you're trying, the way you rebuild trust is over a period of time, you establish a pattern of never repeating the major offense here. And you already told me what the major offense here was. It wasn't buying things on the Internet. It wasn't Pokemon cards. It was lying. Yeah. That was lying. Yeah.

That was the major offense. And so if she enters back into this, if she were my daughter or my little sister, I would tell her to give you a shot, but you get one strike. Yeah. Never again do you lie. You are so unbelievably honest that it's awkward all the time around your house. Do these jeans make me look fat? Yes. You have to tell the truth all the time. And you have awkwardly and be proactive about making sure

there's no place for mistrust to live. So you're sharing all the account passwords. You're putting the pin. You know, you're sharing your location on your phone. I always say make it to where there's no foothold for that to even get in. Yeah. And that way there's no questions. So let me let me kind of give you a correlation a little bit in my life.

There wasn't a deception. But my wife did lose faith in me when we went broke because i was stupid which was valid it took years for her to trust a hundred percent in my judgment we made all decisions together and still make all decisions together, which gives her comfort that I'm not off chasing the moon somewhere like you were. You went off chasing a get rich quick thing and that I did too. And that's how I went broke. Didn't cost me my marriage, did cost me bankruptcy because I was an idiot.

Okay. I did it with more zeros than you did it, dude. So she, but it took her, I mean, we've been married 43 years. That was 35 years ago we filed bankruptcy. To this day, if I say a phrase a certain way, I'll see her head tilt because it reminds her body, it reminds her emotions of those old days, and then i have to stop and rephrase and go okay here's what i was really trying to say oh i could see her body react to this day now it's not much it's very seldom today because it's been a lot of years of a good pattern trust has been rebuilt

she trusts my wisdom now and and but it's with you know i had 30 years to work on that absolutely so you've got to rebuild trust in your integrity. No strikes, no lying, no purchases that she doesn't know about the rest of your life. Not a freaking pack of gum. The rest of your life period and it's like if you were if you're an alcoholic and she says i'm done and but i'm going to give you one more chance one more time you fall off the wagon you're gone yeah yes you're on you're on a one strike deal and then then you got to lean into that and and it sounds like you're ready to do that it does

sound like that it does sound like that but i you know time will tell it she may not be ready she may not want to do it but um this is how it works folks you've got to tell the truth and you got to work together on money high correlation between that and winning with money high correlation and not doing that and losing with money, high correlation and not doing that and losing with money. This is the Ramsey Show. Live from the headquarters of Ramsey Solutions, it'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. Jade Walshaw, Ramsey Personality, is my co-host today.

She's the number one best-selling author here on the show with me. We're answering your questions at 888-825-5225. Rex is with us in Columbus, Ohio. Hi, Rex. How are you? Hi, Dave. Hi, Jade. I'm doing well. It's a pleasure to talk to you two today. You too. What's up in your world?

So I'm 27. I got married just over a year ago. Bought a house shortly after. We're on track, baby steps four, five, and six to pay off our home in about four years from now. Our first child is on the way due in five months. And my question is one about priorities. I really want to keep paying down this house ASAP. So my wife, uh, not have a job in the future other than carrying family, but I also want

to be generous with others. And a buddy of mine went through a separation recently. He's a hard worker, not a bum, but he started from scratch, saving up to buy a car. And I'd like to give him a beater for Christmas as a way to bless him and advance his future, but I worry if this is reckless financially while I still have a mortgage. What's your pregnant wife say? I just brought this up with her yesterday, and she's mixed about it. She's more hesitant than I am, but surprisingly, she was not averse.

What's your household income? Between $225,000 to $250,000 a year. How much do you have in your emergency fund? At least six months of expenses, about six months. How much? I want to say it's like $30,000 to $35,000. How much are you spending on the beater? I'm thinking no more than $1,200. Oh, I'd do it. $1,200? That's it? Yeah. My car's gone down a

little bit, so I mean, they used to be in pricier, even the beaters. I mean, I'm just telling you, if I woke up in your shoes today, I would do that in two seconds. It's a very small part of your world. It's a good point. But if I may add one more piece, I am considering a career change relatively shortly. Although, again, I'm making $100K and the rest, about $ rest about 125 or so is my wife um I worry about my my future at this company I don't feel as though I'm doing a good job as I have in other roles it doesn't seem like a good good fit for me so so you fear you make 100k if you lost your job 1200 bucks don't help you that's a good point yeah I mean for me that doesn't change it much what you're talking about is how far in the future you know what i'm saying so for me i mean if it really made you feel that

weird you could say well i'm gonna i'm gonna spend twelve hundred dollars on this and then i'm gonna add an extra twelve hundred dollars to my. Like you could balance it in a weird way to make your brain feel better. And I think when you do that, you'll realize, oh, this wasn't that big of a, it wasn't that big of a deal. What's interesting is, is that this tiny little bit of stress really shined a big light on your career thing and means you need to get off your butt and do something about that. That's a good point. Right. You need to act on it instead of wait and let something happen to you. Yeah.

Are you concerned that when you have this baby, your wife's not going to want to go back to work after leave? I don't think that's the case. She's working from home now, so it's relatively manageable. Okay. But I do still want to have, I want to give her the opportunity to not feel trapped in her job. I hear that.

$1,200 does not keep her from coming home. You losing your job might. Right. So these are way different decisions. One's $100K, one's 1.2% of $100K. But kudos to you for thinking in the way of generosity like that. I love things like that. It's the reason that you go through and do the baby steps so that you can do those sorts of

things so really good and you yeah and also what's weird is this 10 years from now you'll forget you did it yeah it's such a small yeah it's such a small he'll remember it the rest of his life but you won't i promise you i don't remember what i have done yeah i don't i don't have no idea bailey is in fort worth texas hi bailey welcome to the ramsey show hi there thank you for taking my call sure what's up hi there so um my husband and i we have recently been binging your guys's show and um we are preparing now uh with our baby step one and are about to start our baby step two um looking at our debt we've made some real dumb decisions and my husband's credit cards um there are several we have let all go into default um over the last couple of years

mine however are current um i have three. And so when listing them, since we know we've gotten all the information about paying them in full, you know, settlement in full with a prepaid debit card, all that sort of stuff. But I just don't know how to go about listing them smallest to largest since they will be a lump sum. I would do two separate. I would do two debt snowballs. One for current debt and work it first and then work the old bad debt second. Okay and then our car loan is actually now a personal loan from a friend should that be gross yeah that might first i i'd want to attack that very quickly that's on your list that's on your list of current debts right right it is just one of the larger ones um because my credit cards are all relatively small however because it's

a debt with a friend it really is hanging over my head how long have you had it how long have you had the debt with the friend i had one year We've been paying, and we're current, you know, we're paying them all monthly. And how long will it take you to pay off the first few things in your snowball, those few credit cards? My first three are only $10,000, so probably about five months. What's your household income? Currently it's at a hundred, but in the next six months we're going to go up to 160. Good. Well, it's not going to take you that long then. Yeah. You better get more than two grand a month rolling out of 160, kiddo. Yeah. It's just not going to go up until February. So we are impatiently waiting.

Okay. Well, and you need to go ahead and cut your eating out off the budget too. Have you been paying the friend or you haven't been paying the friend? We have been, yes. What do you owe on the car? $10,000. Oh, you'll knock it out. It'll be gone by summer. If it makes you feel better, just tell them, hey, we're doing this debt snowball,

and we list them smallest to largest. You're number four, and our plan is to pay you off this year so that we're not running this thing out yeah you should be done you should be done with them by april or may yeah okay that is our hope and then just go ahead no it's not a hope it's a math thing yeah hey run the math out have you done the math on this to see what your projected date is because if you haven't you need to jump in every dollar you need to do your road map so that you know we have downloaded've downloaded every dollar and we are using okay then that's then that is the accountability there and just for from somebody who's been in your shoes you need to

speak that way because if you run everything if you verbalize everything as if it's uh it might happen it might not then chances are it might not happen so you need to verbalize it in the way of well we'll be done with that in april and then when we're done with this one in January, do you see what I'm saying? You need to use that and let that be your vocabulary, because that's going to inform what you actually do to accomplish this goal. Yeah. How fast do we go through 20 grand, 10 in credit cards, 10 in car, making 100 bleeding into 160. Pretty stinkin' fast. Pretty stinkin' fast.

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Jade Walshaw, Ramsey Personality, is my co-host today. Open phones at 888-825-5225. The old motivator from another generation, before there was a Zig Ziglar, before there was a Tony Robbins, before there was a Dave Ramsey, Earl Nightingale said what you can conceive and believe you can achieve. Jade, with that last call, you said the same thing to her. You need to be so dialed in on your numbers that you are speaking the future, March of 2025, as if it is fact. fact that's right because the math is telling you that it is a fact and you don't use language like i hope maybe maybe hopefully sorta kinda tells me

you haven't dialed in your numbers exactly you need to get a little bit nerdy with your numbers and because here here's what really happens out there in the real world. In the real world is almost always you will get out of debt faster than your first plan you lay out thinks you're going to. 100%. That is so true. You know, I remember, because some people know this, some people don't, but I used to listen to the show long before I ever got to work on the show. And I remember you used to say, Dave, when you start working the plan intensely, you get on a moving sidewalk. It's like at the airport when you go and you can either walk normal or get on that little sidewalk and it makes you walk a

little bit faster. That is so, so true. I think you just open yourself up to opportunities when you say, I'm going to go lightning fast. I'm willing to do whatever work it takes. Then you begin to see the opportunities around you to go faster. Yeah. I think God just looks down and goes, oh, there's a smart one. I think I'll help this one. Who wants to do it my way. Yeah. Yeah. They want to get out of debt. I think I'll just lift them right along here. Fly little bird. Yeah, that's right. And you just, you look up and you go, well, that's supposed to take nine months and it took seven.

That's right. But what I was saying to you on the break, and this really does segue into every dollar, is most people have never said, I am going to do, insert specific task, and I'm going to do it in this timeframe, insert specific timeframe, and this is going to be the exact outcome.

And once you do that for the first time, and a lot of people for the first time they do that, it's when they do their every dollar budget and when they pay off their debt. Once you do that, it creates a confidence on the inside of you that, oh, I can actually say something, do it, and hold myself accountable. That is, it breaks open a whole new world of possibility and confidence in yourself so that alone you know like we're approaching the first of the year we're going to do the goal setting talk yeah and uh we always do that and it's something i've taught entree leaders for 25 years and i learned it when i was 12 years old going to these motivational seminars my dad in the real estate business but um i want to lose weight is not a goal no i want to lose 30 pounds okay over 10 years and how many times do you want to lose 30 pounds

yeah it's like yeah well i mean hello so uh okay so okay. So these are still not a goal. It's a wish. It has to be specific. It has to be measurable. It has to have a time frame. As soon as it has all three of those things, then you will do the long division math immediately that you learned somewhere around the fourth or fifth grade, hopefully. And that is, I want to lose 30 pounds. When?

Oh, 90 days. Oh, you mean 10 pounds a month. Oh, you mean two and a half pounds a week. Oh, I'm going to increase my aerobic activity my water intake and decrease my bread and sugar intake and i will lose two and a half pounds a week it's magical you don't even need oprah i mean that's how it works that is how it works because you you dialed it in but it's specific it's measurable you spoke it because it's in a certain time frame and then then you know if you're on track or not.

Yeah. And that's why doing your every dollar budget works. That's right. Because you can look at it and go, am I accomplishing what I said I was accomplishing? And so, yeah, let's get into it. This is how it works, ladies and gentlemen. So check it out. You can download every dollar for free in the App Store or Google Play.

Do not miss this. People who win at anything are doing that intentionally. Winning is a series of intentional acts. David's in Fort Smith, Arkansas. Hi, David. Welcome to the Ramsey Show. Hi. Hey, what's up?

Oh, I got a problem. My insurance company is wanting to, they say it's illegal for them to insure my automobiles because I have such a low credit score. I've been very wise with my money. I have no bills. I don't borrow a lot of money. I don't need money. Who's your insurance company?

Who's your insurance company? Shelter Insurance. Shelter. Okay. Yeah. Okay. Yeah. Okay. The agent that you're talking with is either an ignoramus or a liar or both. They sent me a letter.

Hmm? They sent me a letter. Oh, okay. They're lying. It is not illegal to issue insurance to someone with a low credit score. It might be unprofitable for them. And here's where this comes from. The University of Florida, in conjunction with the University of Pennsylvania,

25 years ago did a study that shows that people with low to no credit scores file more claims more often. And so the insurance business across the board took the FICO score and used it to raise rates. But it has nothing to do with legal so my credit my credit score is zero and has hey david my credit score is zero and has been for 30 years do you think i have trouble getting insurance no but i have old automobiles i have a 2007 a 2014 i have nothing new i have a 2011 harley and 2014. I have nothing new. I have a 2011 Harley and a 2000.

I have nothing old. Everything's got a live built-in insurance on it. You see what I'm saying? I have nothing with full coverage insurance. Don't need full coverage insurance. You have debt? No, I'm debt-free. You have a zero credit score?

I have a zero credit score i have a zero credit score okay well then what you need to do is fire your stupid insurance company because they're stupid and get you another one so go to ramsey solutions.com and click on elp for endorsed local provider and you can find the insurance for home and auto it's called p PNC, property and casualty insurance, and those agents don't work for a single company. They work for you. They will shop among many companies and get you the best deal, and you can decide how to do that. But it is not illegal to issue insurance on someone that has a zero credit score they are following a false

premise because the research that i just referenced that's 20 years old or 25 years old was incomplete research and that it is valid in the sense that if you have bad credit because you don't pay your bills you are more likely to file a claim and a higher claim that does make sense because you're broke now but if you have a zero credit score uh i'm not more likely to file a claim i'm a multi-millionaire that's dumb i'm less likely to file a claim that's dumb all right so obviously the research is incomplete for a guy like david or a guy like me david's got plenty of money he just drives beaters because he wants to that's what he said and that reminds me of that same um way of thinking with rental cars i feel like it's the same thing you know i just came i was leaving where was i leaving denver and i wanted to rent the car and then drop it at another

airport and they said you cannot do that if you don't have a credit card. And I said, what's that got to do with it? Because of the theft. Yeah. There's entire gangs that are running debit card theft. They're stealing these. The size of the rental car business is unbelievable. And the size of theft that they deal with is unbelievable.

That's what the guy was telling me. That's exactly what does it. So we learned that when we had Dollar Rent-A-Car as a sponsor here for a while. We talked them into being the world's best debit card only. They took the debit card for Ramsey listeners. And we did that for a while. And then, of course, with COVID, everybody went bankrupt, including Hertz that owned them.

And so then they come back as Dollar. Dollar came back as $2 Rent-A-Car and um they got a new ceo and a new leadership team and decided they weren't going to take debit cards anymore which means we had to take them off there because we can't endorse them anymore so uh we lost a sponsor and they lost a bunch of customers because that was stupid but anyway that we learned all this they showed us the data back in the day, why it was so risky, because they're literally, and I'm not making this up, gangs that steal cars from rental car companies. On debit cards. And they use a debit card to do it.

And the worst location in the world is Las Vegas, by the way. Yeah. But, yeah, for some reason, if you pick it up and drop it off at the same location, you can use it. It's fine. Well, that's because they think they're going to get the car back at least. Yeah. The idea that you're leaving California and never coming back is scary to them. This is The Ramsey Show.

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Jade Warshaw, Ramsey Personality, is my co-host today. In the lobby of Ramsey Solutions, Casey and Jesse are on the debt-free stage. Hey, guys, what's up? Hey, guys, how are you? Hey! Welcome. Where do y'all live? Ruston, Louisiana. Oh, fun. Welcome to Nashville. How much debt have you two paid off?

We have paid off $205,960.46. I love it. How long did this take? 23 months. Whoa, you're cooking. And what kind of income range during that two years? 110 to 140. Wow, nice. What do y'all do for a living i'm an equipment manager for a golf course okay and i'm a payroll administrator and what did you sell uh these numbers don't work yeah exactly we we uh sold some land and a rent house nightmare and a lot of other things. We sold so many things the kids thought they were next. I love that. So what did the rent house nightmare bring?

It brought $122,000. Good. And what did the land bring? About $25,000. Okay, cool. And what kind of debt was the $206,000? A maxed out home line of credit on the nightmaremare Rent House, a camper, car, credit cards, phone loans, and medical bills. Y'all were normal. Everything but student loans. Yeah. You were

normal. You had it all. Yeah. That sucks. We had to. It really did. It was horrible. How old are you two? I am 36. 38. And how long you you been married? 17 years. Okay, so two years ago, three years ago, you had a I'm sick of this, sick and tired of being sick and tired moment. I've had it. What happened? Tell us the story. So I actually listened to your book a few years before our journey. We were already drowning in debt. And I listened to the total money makeover. It was like, he is so right. We have got to get out of this debt. We'd have so much margin in our life.

But I don't want to listen to your plan. I want to do my plan. You're the first person to ever do that. We raised the limit on the maxed out home line of credit and maxed it out again. There you go. And then found ourselves in even more debt. This was the third time we consolidated our debt. Each time we doubled the debt.

And didn't change habits. Go back in. No habits changed. So two years ago, we're drowning again. The renters hadn't paid rent in six months. And we had a variable interest rate on the rent house. So the feds were going up. So we went from $300 interest payment to $900 interest payments.

Yeah, it was bad. We couldn't do it. We literally couldn't pay. so then i listened to your book again and this time it sank in it's okay my plan obviously isn't working i had prayed numerous times god please increase our income so that we can get out of this and he said no i'm cutting you off you obviously are bad stewards of my money you've got to learn this lesson so then i said let's do this and at the time our marriage honestly was on the rocks. Casey was dealing with some heavy depression. And I was like, I'm not sure how I'm going to get my spouse on board.

Because he wanted nothing to do with the finances. I'd given up. I was done. Well, did the weight of this add to the issue with depression? Correct. It was a big portion of it. A lot of it. So I did the only logical thing, which is say, hey, I'm going to sell this gift that

you bought me on credit a few years ago. Why don't you ride with me to make sure that I'm safe as I sell this item? And I trapped him in the car listening to Total Money Maker. It didn't go well. He made fun of the book. You know, it can't be that easy. It's just seven easy baby steps. A baby could do it.

It's so easy. He's not a believer at first. You steps a baby could do it it's so easy i'm not a believer at first you're not listening he says it's not easy so i'm like okay i'm on my own give it a few days so when he comes home and uh i'd listen to a few of the debt-free screams i started listening to the podcast and heard a few of them and it was very inspiring very emotional for me and i said you what, if these folks can do it, who some were worse off, some were not as much, but they were able to do it. I thought, why can't I?

Made it real. Yeah, it did. It finally did. And now you're here doing that for somebody else. That's it. That's it. Let me ask you a question because I'm researching this exact thing. There was something that when you first heard the baby steps, you had an emotion that caused you to say, I'm not going to do it exactly like they teach. I'm going to do it my way. Casey, you had an emotion that caused you to say, I'm not going to do it exactly like they teach.

I'm going to do it my way. Casey, you had an emotion that caused you to say, this guy, this is not a baby step. This is, you know, for adults, whatever you thought. What was that emotion that caused you to initially kind of back away from it? Was it fear? Was it? It seemed insurmountable. It seemed insurmountable.

Like, this is impossible. I thought I was going to live to my death, working and in debt. I grew up knowing it. I was in the mindset of, can we afford it? That's, that's the culture I grew up in is not, can we afford it? Can we afford the payments? That's the word. That's how I grew up. I'm like, this is, this can't be done. And what about you, Jesse? What was it that caused you to say, I'm going to do it my way. This sounds good, but I'm still going to do it my way. Well, I don't want to take the time to have to go through all of this. If I can just wipe it clean and have a $400 payment in one thing versus working and taking years. I mean, when we initially looked at the snowball calculator, we were at 2031 paying off all this debt and we did it in 23 months. That's right.

It was just just but the snowball calculator did not include selling off everything right it's not at first it did not yeah when you when you plug that in it changed the numbers it did it did and we had i mean life happened uh all the plumbing busted when we had a freeze in that rent house oh my god this house is the worst it was uh the renters had destroyed it. I mean, flooring was gone. There was a lot of fecal matter everywhere. Oh, great. Animals, animals.

But we did have a real estate pro, Ramsey Pro, and he helped us through the whole thing. I mean, I would work at night, get off work, go to the house and clean. And then Casey worked a ton of overtime. We door dashed. You gave plasma. Yeah, yeah, sure did. Wow. But once you start going, and I used some debt-free trackers as well,

it just kept us motivated of knocking this out and getting ahead. How does it feel to be free? Amazing. Amazing. It's so nice. I wish everyone could feel this way. It's awesome. Our daughter made homecoming court

and we're like we have to go buy two dresses now and we could just afford it it was this is within the past we had margin yeah it's been so fantastic we get to buy yeah exactly yeah yeah yeah yeah that's so good very cool and then uh the facebook group the Steps community that y'all have really helped as well. Just looking through and seeing other people's stories, which, Jade, you became a personality about a few months as we started. And your story really helped motivate me a lot. You and Sam. I was like, OK, they have way more depth than I do. I don't feel nearly as bad.

Let's do this. I'm so glad. So what would you say to that person who's listening and and there were you there where you were Casey they're going this is not as easy as you think it is Jesse they're saying I'll do it but I'll do it my way what would you say to that person you can do it it's not impossible just start yeah budget and start because if you just look at it has a hole it is it's overwhelming you're like we're never gonna get out because if you just look at it has a hole it is it's overwhelming you're like we're never going to get out but if you just start and really follow the steps and

start with baby step one and then start with baby step two and pay off that little debt each credit card down which is so exciting to us like now we have more money to throw with that debt that's right i mean we started at only being able to put an extra two hundred dollars a month towards this debt by the end we were throwing over three thousand dollars a month at it yeah ding ding ding ding yeah yeah and 23 months out of your 17 years was hell oh wait a minute a lot of the other was hell too but this hell got you out that's it you paid a price to win. Way to go. I'm proud of you. All right, bring the kiddos up.

Let's get their names and ages. Looks like they survived the cutbacks. They sure did. They sure did. We got Emily here. She's 15. Way to go, homecoming queen. She just turned 13.

I love it. I love it. I love it. Well, this is excellent, you guys. Proud of you all. Thank you. Well done. Who was cheering you on?

Friends and family. Co-workers. Yeah, co-workers. Yep, sure was. Everybody was pretty much cheering us on? Friends and family. Co-workers. Yeah, co-workers. Yep, sure was. Everybody was pretty much cheering us on, especially when they heard how much we owed. Yeah. I love that you're debt-free. My favorite part of your story is that cloud of depression has lifted off your house.

It is. Yes, it is. That makes me cry. That's a powerful story. Marriage is a lot better now. Marriage is way better. The transformation over the past two years is unbelievable. I mean, I had given up on our marriage practically,

but after counseling and this, I mean, we're stronger than we've ever been. Y'all are amazing. Well done. All right, count it down. Let's hear a debt-free scream. Ready? Three, two, one. We're debt-free!

Yeah! $206,000 paid off in 23 months. Oh, but everything in the house is transformed. Hello. Depression, marriage, everything's transformed. See, the debt's all tied into this. It's not a standalone subject that you can compartmentalize. It's woven its way into your life.

It's time for you listening to get it out. They were here to tell you that. I hope you heard it. This is The Ramsey Show. This show is sponsored by BetterHelp. All right, so I was born and raised in Texas, and I love the myth of the lone cowboy. You know, the guy who doesn't need anyone or anything. It's a fun story, and it's a lie. In our self-obsessed society, we're obsessed about

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with your schedule. To get started, just fill out a short online survey to get matched with a licensed therapist. And if it's not the right fit, you can switch therapists at any time for no extra cost. This month, start to build your support system with BetterHelp. Visit BetterHelp.com slash Ramsey Radio to get 10% off your first month. That's BetterHelp, H-E-L-P.com slash Ramsey Radio. Jade Walsh, our Ramsey personality, is my co-host today. Hey, guys, if you didn't know, I love talking to you about money. We also help small businesses, about 10,000 of them across America. And we have a podcast called Entree Leadership. It was actually the very first podcast we ever did at Ramsey.

And it was run by other Ramsey personalities and interview style and stuff over the years. I took it over about two years ago and started taking calls from small business people about leadership and small business questions. It's called Entree Leadership Podcast. It's very popular in that world. And if you want to be part of that and you'll run a small business, you got a question about it, you can call and leave us a voicemail there at 844-944-1070, 844-944-1070. Or you can go to entreeleadadership.com slash ask. Leave your question, and our team will get you set up to be a caller on there.

Also, a reminder that this is the last portion of the show that is broadcast over YouTube and podcast. There's another portion coming up that is on the Ramsey Network app and on some talk radio stations around America. And so if you want, the Ramsey Network app is completely free, so you can finish this version of the show, video or audio, or both, and just jump over to the Ramsey Network app. It's completely free.

There's all kinds of stuff you can do there, like search calls by subject, find out what we've got to say about any certain thing, type it in. You can type in an email and send it to us. We'll answer it here on the air. We do a lot of stuff that's really fun over on the Ramsey Network app, so be sure you check all that out. Ryan is with us in Hartford, Connecticut. Hey, Ryan, welcome to the Ramsey Show.

Hey, how are you guys? Sure, what's up? Hey, so I have a bit of a problem. I never thought this was going to happen. So in 2018, my father passed away, and he left me and my brother a 401k plan. Fast forward five years, I got a check in the mail this morning for about $245,000. And the original account balance was about $300,000. And what's happening is they gave me the check, and I have to pay the IRS that $55,000 difference from the $300,000 to $245,000. I called them and asked them if they could roll it over, and they said once they issued the check, there's nothing that can be done.

Who told them to issue the check? Not me. Apparently, the company my father worked for, I didn't read. I'm sorry. I didn't hear you. You cut out. Apparently, the company your father worked for, what? Yeah. They have a five-year plan, I guess, for the death benefit that if it's not rolled over

to something else within five years, they must close the account and just issue a checkout. It's super confusing. The way they explained it to me, I was on the phone with them for an hour and a half this morning with my 401k company, and they pretty much said, once we issue the check,

there's nothing that can be done. There was no workaround. They had until this. That's what I'm saying. I'm sure you don't have an extra $55,000 laying around. No, so the way it worked is my account balance is $300,000. It started at like $215,000, and over the years I got it up to $300,000. They issued me a check for $245,000. They already took the money out and sent it to the IRS and issued me the difference.

Yeah, they have to withhold 20%. That's the rule if you take a withdrawal. But this is an involuntary withdrawal without any contact to you or anything, which is completely, at a minimum, unprofessional. What caused you to wait the five years as opposed to rolling it over? Because the 401k plan my father was invested in had really good options like i built up all of those same options exist in the open market yeah and i i have my own personal investment accounts and i do it with that as well the you know if you know don't rock the boat if the boat shouldn't be rocked so the way i figured is the 401k plan was perfectly fine i kept it in

there just because the investment options were fine it was just it's a retirement account i was treating it like a retirement account i wasn't going to touch it till i was 65 i'm 30 now yeah what do you like it was uh i make uh i'm a truck driver so i make about 110 000 a year and i also own a small business that I make about the same. Okay. Under the SECURE Act that Biden passed, you have 10 years to liquidate the 401k completely. You should have been liquidating it at one-tenth a year from the time the SECURE Act passed two years ago, and you've not been doing that.

I didn't know about that. I know. So I'm trying to figure out how that plays into this and how hardcore. Let's pretend that we figure out a way to lean on them and they cancel the check and put the money back into the 401K so that you can roll it over within 30 days, which is what they should do if they're people of integrity. This is a problem.

It's not technically unethical. It's just so nasty that it ought to be unethical. Yeah, it's a big investment. It's going to cost you, you know, $20,000, $30,000, and that you don't have, really. It cost me two years. It cost me two whole years of gains because of this. No way.

I never thought I would be upset to get a huge check in the mail, but I did. I'm upset because I should have had it rolled over. It should have been huger. He should have called me. Yeah. All right, so here's what i'm going to suggest you do and i don't think it'll work but it's the only thing i can think of all right okay go to ramsey solutions.com and click on smart vestor and find a smart vestor pro in your area

that you like after talking to them on the phone they may be able to call on your behalf and talk them into undoing this and immediately rolling it, and they'll help you with the rollover. Okay. They may be able to cite a regulation or something that I'm not aware of. because this is when you started talking, I thought you were going to tell me this was a tiny little 401k, like a $10,000, and they were just cleaning out all the little ones. Sometimes they do that when a company sells or in the event of an inherited 401k like you've got. But this is huge.

This is a lot of money. And with no notification at all, this is particularly nasty. And so if they had simply notified you, you could have quickly rolled it over and avoided this, right? And they said they notified me, but I'm very – Oh, wait a minute. You're a truck driver. Oh, that's different.

Once a week. You didn't – they did notify you my accounts they said they did but i never got enough so you've never seen evidence of them religiously yeah ask them to prove that they ask them to prove that they did okay okay so idea i mean i don't i don't think you've got a basis for suing them but but I'd be tempted to. I really would. I mean, because you're talking about $25,000 or $30,000 cost here. That is unnecessary.

$55,000 they took out. No, it's the taxes on $55,000. The $55,000 is going to be taxed, not penalized. No, when I got my experiment, like the summary of what my original account balance was $300,000. They cut me a check for $245,000. I understand. They took $55,000, they sent it to the federal government as tax withholding, and it's not all taxable. Because you're going to roll the rest of this. If you take the check in your hand and you roll it to a 401K,

the only harm that's going to come to you is the taxes on the $55,000, which is going to be $15,000 or $20,000. Oh, so I'm going to have to pay another $15,000. Honey, you haven't paid anything yet. Okay, they withheld your money, $55,000, and sent it to the federal government then what you do is you file a tax return of what is actually due and what will be actually due is not 55 000 it'll only be the taxes on 55 000 if you take the check in your hand and put it into an ira traditional within 60 days of right now so you need to get on the phone with smart investor pro right now because at least we need to do that

okay i will but so the worst case scenario if you follow through on what i just told you is taxes on fifty five thousand dollars because the government has fifty five thousand of your money as if you're going to get taxed on the whole thing and you're not okay because you're going to roll the portion in your hand which is 80 percent of it into a traditional to keep you from getting taxed you got 60 days to do that from the time withdrawal so folks you can pull your money out of 401k they have to withhold 20 but you have to put 100 into an account within 60 days to avoid taxation. He can't do that because they've already sent it. But he can't do that because they've got 55 of his money over at the IRS now. And so if you just take the 55, then you're going to pay some taxes, but not 55.

So there we go. 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, where we help people build wealth, do work that they love, and create actual, amazing relationships. I'm Dave Ramsey, your host, Jade Warshaw, Ramsey personality, number one best-selling author, is my co-host today. We're taking your calls at 888-825-5225. Ken is in Atlanta. Hi, Ken. Welcome to the Ramsey Show.

Hey, thank you for having me. Sure, what's up? I'm just, I guess I'm struggling with my parents. It's kind of the short and sweet of it. They haven't done the best at planning financially for their future. And even as, you know, when I was a kid, I had probably some trauma there as well. But I'm struggling with supporting them, but also like supporting my family in this like fine line, like, what do I have to give up with my own family? Like, my kids, where do they have to suffer?

What things do we have to go without? So that way, like, I take care of my parents and don't feel like a terrible son. If you gave them no money at all, why would you be a terrible son? Who said there's a law you have to give your parents money i don't know that law i know um i know it's not a law i guess i just i guess i struggled just internally with this conversation because i've had to bail them out and like keep them from getting evicted before and like have lost sleep multiple nights over the that call of like hey we can't afford to live where we're living

and they're not living anywhere like you know super amazing or anything I mean their rent is super cheap um and it the most recent time I gave them money and it was kind of like hey this is the last time and we walked through like an envelope system with them and said you know you barely make more than you make you know the same thing beans and rice you uh 56 and 58 um so i mean they're definitely a little bit older but not like they're my mom's still working full-time my dad is uh on disability currently um and what is the nature of his disability uh he he his knees aren't working his arms aren't working too great like he's i don't know what he draws a month exactly i've honestly i've been trying to get more out of their finances because i used to be over consumed with it and i just realized it was super unhealthy

but i'm still just so they won't share it with you they won't tell you the amount they have and again like it's one of those things where we've walked through the like hey here's every bill you have here's every bit of money you've got coming in at the month like you can make it work but it's very very very tight and they chose not to do that yeah but also like my mom lost her job at one point and then she got another job like there's's just things that have happened. But at the end of the day, I just, I feel bad. Like, I think this is maybe even more of an emotional thing because I love my parents, but I don't want to be around my parents. The truth is, the truth is, and I'm not saying that this is easy in any way, shape or form. The truth is, if you feel bad, if you feel guilty, that's your choice. You're putting that

on yourself. They can try to say whatever they say, but at the end of the day, if you feel guilty, that's your choice. You're putting that on yourself. They can try to say whatever they say. But at the end of the day, if you choose to accept that, that's you doing that. That's the truth. But also, I'm not by any means saying it should be easy for you to just let that go. But I am saying that it's not true. They're adults. They've been grown adults longer than you've been an adult. They've been given the means.

They've been given tools. They've been given the same shot really as you and they've made their choices and in many ways they've made their bed and that's theirs to lay in fair enough no it was fair i guess i'm just struggling with it's it's natural to struggle with but but you do have to do this okay number one um i'm going to send you a book from our bookstore called boundaries by dr henry cloud and um you're going to read it and go oh i know those people yeah you're gonna go oh yeah okay it's gonna make you feel not so crazy okay because someone who even if their parents are dysfunctional as parents and even if they are dysfunctional and irresponsible in the handling of their money if they're both things it's still very difficult to just put up a stone wall and say i'm not helping at all

it's very it's just hard to do. But the truth is, it sounds like that's what you're going to have to do. Okay. I think you're done. Because you can lead a horse to water, and you can beat the snot out of him, but he's still going to drink. Yeah. If only.

You know, he's just going to sit there and look at you like you're an idiot. Well, I know there's water there. i'll get water when i want some water so um your dad um could do some things he might not be able to do physical labor anymore but there's some things he could do he's only 55 years old crap i'm 64 i work every day shut up so um you know i thought the same thing and it's just like yeah and your mom and your mom losing her job is because she half butt does the job she goes to she's not exactly a stellar employee she's like take it easy and she means it i guess i'm just thinking that they've got the you drove right by that was i right or not yeah yeah okay they just don't i don't think they listen to me because i'm their kid and they wipe my butt so like yeah that's it you also just have to accept

the fact that this might it's not your problem to solve that's it that's the bottom line you're not you're not a bad son it's not a law i know that i just part of it struggles too is like i'm thinking and i don't want to monopolize so here's what i would do here's what i would do if i were in your shoes okay i'd read that book boundaries i'm going to spend some time in prayer about this and say god i need you to help me release this i want to be compassionate and kind but i also don't want to uh be taking care of grown people that should be taking care of themselves this feels weird to me god so help me with this, Lord. And number two, number three, I personally, if I were you, I would say, here's a Ramsey counselor coach that will sit down with you and help you with your budget.

And here's Financial Peace University. And you go through the class and you go to this coach and they're going to help you manage your money. I can't do it. I actually really like that for you. I would do what? Because we've been doing your stuff for a while now, and I actually told them, like, hey, I'll pay for someone to sit down with you.

I'll pay for you to make it to the meetings, like to take whatever financial excuse they may come up with to, like, not go to a meeting. And it just – I think at one point they started, but then they just stopped going. All right, I'm done. I'm really done now. You gotta let it go. It's not your problem to solve. And I love what Dave said. You spend some time praying about it. I have a buddy that says all the time, prayer is never the least you can do. It's really the most you can do for someone. So in your mind, if your fix for this was you

providing money, you paying for all the things, maybe you need to reshape what your role in this is and go hey my role is just to pray for me and pray for them i'm a cheerleader i hope you do good things yep i've shown you how to do what you're supposed to do you got fpu you got the coach's name pick up phone call them good luck with that praying for you i hope you do it shake the dust off your feet my friend that's it i'm i hope you do it i hope you do it but you know what what we run into in these situations is and this one i'm i'm the more i learn the more i'm done with it i because i've been there i guess everybody we've all been there where you got where you want something more for someone more than they want it for themselves yeah you know it's tough you. I got a buddy doing cocaine.

I want him to quit way more than he wants to quit. So he's going to keep white nose as long as he does that. There's nothing I can do about it. I can't stop him. It's going to kill him. It's going to kill himself. He's not going to be a close buddy either because I don't want to get arrested hanging around the moron. But yeah.

But I mean, that's, jeez, man. How much talking can you do you can't you know it's just good luck with that good luck with that hope it works out for you so aggravating some people's parents this is the ramsey show show. It's that time of year. In a few weeks, we're going to be doing a special giving edition of the Ramsey Show. We love this show. It's your favorite show. According to the surveys, you love hearing the stories that make your eyes leak about people who are generous and giving and people who, uh, so we hear stories from you about when you received something or when you gave something and they're good stories not just one time i'll give some

money that's not what i'm talking about i'm like i want to hear the story i want to hear i want some color commentary here so we're going to do this uh in just a week or so a december 18th so go to ramsey solutions.com slash ask put giving in the subject line put a little bit about a little bit about your story and we'll make you part of the giving show so if you've got a great giving or receiving story that will inspire others on the act of generosity tis the season baby time to share it there we go let's do it this is gonna be fun scott's with us in pennsylvania hey scott what's up hey dave how you doing today better than Scott, what's up? Hey, Dave. How are you doing today? Better than I deserve.

What's up in your world? I definitely hear that one. Well, hey, I just got a question on rather to launch a business or pay down debt that I've accrued to establish what I needed to for the foundation of the business in general. Business is a product line, so a mineral bar is what it would be. There's a lot of context behind it, but go ahead. So did you say you accrued debt starting the mineral bar, and then did you say you're trying to decide if you should pay off the debt of that

or start another business? So it's the same business. It's just taken me a little while to gather what I needed to gather to get to the point of launch. And so I've got my savings, which is $29,000. The debt is $22,000, so I could pay it off, but then I wouldn't have enough to launch this next stage of actual production on the mass side. So right now, I'm on a small scale. How much product do you have now?

Right now, small scale, under 100 units at a time, just to kind of get that formality right. 100 units cost $22,000? Oh, no. Oh, no. So that took years of having to go and figure out, meet with the right people. So just expense accrued over the whole time frame. How long have you been starting this? How long?

Started it two years ago ago just as a concept. So what is the product that you actually own? How much money is in the actual product? What's the cost of goods? The actual product is going to be this debt that I just mentioned. So I would say that that's $20,000. No, honey. I mean, if you sold everything you got in your garage, how much would you get?

Oh, beautiful. Zero. Zero. And I should capitalize. this isn't my bread and butter so i'm sorry where the heck did your money go you spent all 22 000 dreaming no no i wish right where's the product go and learn where's your product we've got proof of concept product where different things that had to come into play you don't have proof of concept you got no product oh that's what i'm saying i've got under 100 units available so i don't have

you have some product he's saying if you sold the product that you have what's not what's a unit a product sell for my price point is going to be one to two dollars but to be very clear i'm doing this specifically as a certified organic product so i can't sell it to anybody until I get my certification. So I needed to do the footwork first before I could get to that point. What do you do for a living? USDA auditor, so I'm a contract inspector. What do you make? Between $70 and $90.

Are you married? My expenses are terrible. Yes, and a newborn, newborn just born what does she make zero stay home mom okay uh if i were in your shoes i would pay off all the debt today and i would cash flow the growth and the certification of this business and that makes sense you're in a business that is flooded oh i know everybody and his brother's an organic something it's not like you there's no i mean it's it's it's like saying i don't have a podcast there's seven million podcasts yep it's just the label so if you pay off the debt which i think you

should you pay off the debt i think you should how much does the next phase of business cost yeah he's gone he's gone that's the thing it's your you need to cash flow the certification and then you can label it if the organic is the only way it sells if you can sell it on the on the face value of what the product actually does whether it's organic or not um then you don't have that you don't spend a ton of money on the – I think your day job is clouding your entrepreneurial judgment. You need to build a product and get it out there. You don't have proof of concept because you've never sold anything. Proof of concept is I actually developed a prototype

or a series of prototypes and sold them. That's what happens. And so you tell me you sold 200 of them to a human that gave you money. Now we're starting to dial in the beginnings of a test market, a proof of concept. But proof of concept, I've got some stuff in my garage that I stirred up and don't have certified. That's not proof of concept.

And so you're a ways yet if you keep going on this track. What I would do is, okay, number one, I pay off the debt. But from an entrepreneurial standpoint, I would take two steps back and say, what can I do that is the shortest method, the shortest path to market? Ship it. Find something. Get a website built. Start some SEO. And ship it. Find something. Get a website built. Start some SEO and ship it.

And you'll see if people really like it, if they'll buy it again. Yeah. Otherwise, you're going to spend the rest of your life spending 20 grand on paralysis of the analysis. Get to a trade show or something. Yeah. Get out there and get something moving. Ship it.

When in doubt, throw it. Try it. Move it. Send it to me. I'll tell you if i like it or not yeah you're you're a fda inspector so you think that everything has to go through 5 000 years worth of inspection before it goes to market and it does not ship it as long as it's not illegal to make it and sell it ship it and try something but something, but do that with cash, not with debt. Never borrow money into something like this again. This is where people lose their butts.

And you've got a newborn, and your wife's looking at you like you've lost your mind. So, yeah, pay off the debt. You've got $7,000 left in your account. Build your emergency fund back up, and then start building up some money to continue to try this business and move it to the next rung. But I want you to short-circuit a lot of the analysis you're doing and take something to market fast. That's really good advice because sometimes we think everything has to be the final version before it goes out. It never is.

And you really want to start small so you can know where to go next. Start with a new one. If you could, and it's not available or anyone could but if you could pull up every dollar the app in the beginning from the day long the day it launched and compare it with what's out there today yeah they're not even oh i remember they're not even close to the same yeah i mean they don't the not even the color scheme is the same i mean nothing is the same way it functions because i know this because we spent a bazillion dollars tearing it all apart and redoing it i mean we took out all

the back end all the code we trashed it and started again yeah one layer at a time so we didn't shut it down while we did it but i mean but then you're getting customer input to create what it really needs to be not just you sitting in your garage going here's what it should be ship it yeah put it out there because it's not five years from now it's not going to be what you thought it was going to be right you're going to be shocked about that one little thing you were trying over there that you thought was the dog turns out to be the one that wags the whole tail and then this other stuff you thought was the king ends up being a bust and you don't you don't know man that's proof of concept that's what that is

so uh seth godin talks about that and says a master marketer um when in doubt ship it i'll tell you who the worst that this is what's up amazon they roll a page out and you you roll it over three weeks later it's a completely different. They are constantly using me and you as a guinea pig to do their research while they're making money on it. Have you watched that documentary on Amazon? Well, it's not specifically on them. It's called Buy Now. And the first part of it, they're talking about how they design these pages and how Amazon's constantly trying new things to get you to click it, buy it, do it now. They're doing their research and development on the fly every day.

They iterate every single day on you. You're the guinea pig. The customer's the guinea pig. They ship it and ship it and ship it again tomorrow and ship it again tomorrow and ship it again tomorrow. And they are one of the best in the world at it. That's how they came up with the one click. Absolutely incredible. It's an easy button.

Killing me, but it's working. It is. It's got me. Working for them. This is The Ramsey Show. Jade Walsh, our Ramsey personality personality is my co-host well what do you think about real estate jade i think it's getting ready to take back off i heard you say that i hope that you're right you usually are i i have a feeling q1 is going to be one of the best quarters in a long time and q2 is going to

be better than that q3 is going to be even better than that speak it i'm predicting a good hot real estate market by this time next year because it's been sitting in the doldrums for so long down in the people are just sick of sitting around with their thumb sucking it going oh it's awful out there life's bad and and you know people are all these people are some of these people are still sitting around waiting on prices to come down they're not going to come down yeah uh so when are you going to buy that's the thing when are you going to light back up when you believe that everything's going to be okay again and uh we're not going to have a we're not ever going to suggest here that a savior is in the white house there are no saviors in the white house if you're a savior you don't get the job at the white house that's not i don't need a savior

i got one um but a change of administration and even if you don't agree with the incoming administration you will know what they're going to do they're very loud about it they tell everybody what they're going to do every day over and over and over again so it becomes a predictable environment which is what business needs to thrive perception is over and over and over again. So it becomes a predictable environment, which is what business needs to thrive. Perception is a powerful thing. And so a predictable environment, even if I don't like it, is I can thrive in it. At least I know the rules. When the rules are, I don't know what's happening. I'm lost. That's not a good rule. That just causes everything to freeze up. Everybody sits around and waits on whatever. So I think it's everything to freeze up everybody sits around waits on whatever so i think

it's going to blow up if you want to learn some things about real estate to kind of get ready maybe you're getting ready to sell a house or getting ready to buy a house first of next year ramsey's real estate home base is a huge section of our website because real estate is a big deal you'll find calculators start to finish guides how how-to articles, a podcast, a book, even a video course, all packed with actionable steps, cost nothing, no charge, help you navigate through the buying or the selling process. RamseySolutions.com slash real estate or click the link in the description if you're on YouTube or podcast. Joel is in Portland, Oregon. Hi, Joel, welcome to the Ramsey Showsey show thanks thanks for taking my

call sure man what's up yeah i'm just trying to decide if it's the right time to buy a house i know that's what you were just talking about earlier um but uh i've had different people telling me different things um i have enough money to buy a house. They said, and I heard, it's a horrible financial planning firm. For real. Yeah. So, I mean, there's just different arguments about, I don't know anything about real estate, but I hear different arguments about how inflation is going to really change the price of houses. Obviously, that's true to a certain extent, but then the mortgage rates are going to go up significantly,

and now's the time to buy. Okay, you said you have the money to buy a house. Are you debt-free? Yes. All right. What are you looking to do? Tell us what you want to do. How much do you have saved, and how much of that's the emergency fund?

I have $55,000 saved, including the emergency fund. Including the emergency fund. Okay, how much is the emergency fund and how much is the down payment? The down payment, it's a VA loan, so I don't have to do a down payment, but I was thinking of putting about $40,000 down on the down payment. Okay. All right, let me help you. VA is the most expensive loan.

I would not do that. I'd put $40,000 down into a Fannie Mae loan. Thank you for your service to the country, but don't let the Veterans Administration screw you. Understood. Interest rates higher and fees are higher. Don't do it. Instead, just let your Veterans benefits do some other things for you.

Thank you. But I would get a Fannie Mae, FNMA, a standard conventional loan, 15-year fixed rate with 40 grand down. What do you make? $330,000, $330,000. Wow. Were your payments no more than a fourth of your take home pay on a 15-year fixed? If you do that, I would buy yesterday, as soon as you find the right house. Yeah, make sure this emergency fund is right, because $15,000 for a 330-year mortgage doesn't sound quite right. Yeah, you need three to six months of expenses. Are you single? Yes. What do you do for a living? I'm a physician. Good for you. Okay. Really good. Are you in a relationship of any kind?

No. Okay. Good. All right. Because that's going to affect the buying decision. That's why I'm asking. It is. That's a good point.

But, yeah, you go buy. I would go buy something now, Joel. I think you're in a position to. I cannot think of a single reason to wait. House prices aren't going to go down. If interest rates go down, you just refinance. Yeah, big deal. Yeah, you date the rate and marry the house.

Sure, sure. Any opinion on physician loans? Physician loans? All that is is just a no qualifying. As long as the interest rate is strong and it's a 15-year fixed, I've got no problem with it. But sometimes they up the rate because it's a guaranteed issue. They go, oh, you're a doc, you can pay it automatically.

They don't check anything. But then they kick the rate on you a little bit. So make sure the rate is competitive. So talk to Churchill Mortgage and ask them to run you the numbers on a physician and on a regular Fannie Mae. And then just compare the two and it'll tell you right. The number will tell you what to do. But that's what I would do in that situation. Congratulations, man. I think that's great.

Very, very good. Yeah. I personally don't think that house prices are going to be anything in January except higher than they are in December. Anything in February except higher than they are in January. Anything in March except higher than they are in january anything in march except higher than they are in february am i getting my point across they're going up they've been going up they've continued to go up even though the market was really slow house prices have continued to climb nationwide total homes for sale right now in america 953 and fourteen average 15 year fixed rate five point

six percent right now median home price in america today four hundred twenty four thousand nine hundred and fifty sounds like 425 to me okay and uh median days on the market houses on the market how long you think a house stays on the market right now boys and girls everybody give me a guess here's the actual number 58 put a house on the market it's gone in two months that's the average right now the median people think that that's slow now because they got used to the but they got used to the ridiculousness of being able to sell a house in two days yeah 58 minutes yeah was the time on the market back during the uh Fauci pandemic I mean it was crazy out there people came out of their houses like Baptist looking looking for a casserole, man.

They were buying houses like crazy. So it was nuts out there. But, yeah, those days are gone. I hope we don't see that again. That was a market disruption. Wild. It was not a healthy transaction environment. You need a healthy transaction environment where a willing buyer and a willing

seller with no duress are having a negotiation. If that was your first, you know, introduction to the real estate world during that time, you've got a lot to adjust. Your brain is upset. Yeah. You got an upset brain,

but that's a good, you know, there's a million houses on the market right now in the United States. And there's probably about 2 million people looking for a house. It's definitely a seller's market. Translation, prices go up, not down. Let's go.

It's called supply-demand curve. They were supposed to teach you that in seventh grade economics but some places don't so supply demand curve works like this when there is a shortage prices go up when there is an overage a glut oversupply prices go down that's the supply demand curve that's simple so we have a million houses on the market 953 000 about two million people looking for houses and uh this median house price is blowing my mind 425 000 i it feels like 20 minutes ago it's 250 000 yeah well it feels like it doubled yeah yeah well i mean everything's 20 minutes ago when you're 65 um yeah it's like everything's in the rear view mirror, but the, yeah, it's crazy. I mean, that's not, I mean, it wasn't even 20 minutes ago.

I mean, in 20, let's see, 2022, we bought our house for about that much. And then when it was time to sell it, it was double. Yeah. 2022. We bought it in 2018. And when we sold it to come here, it doubled. Okay. That's, but that's wild.

That's not normal. Yeah. Well, that's seven years ago. Doubled in seven years. No, no, no. No. Doubled before you came. Yeah.

2018 to 2022. Four years. I bet you. I'll have to look it up. I'm curious now. But anyway, that's what's going on out there. An average fixed rate home on 15 year. Yeah.

5.6. That's down. They're down. Yeah yeah it's a good time get out there this is a ramsey show our scripture of the day luke 6 38 give and it will be given to you a good measure pressed down shaken together and running over will be poured into your lap jay paul getty says money is like manure you have to spread it around or it smells all right i'll go with a little generosity there we go left in one pile it stinks yes i like that that's good. Dylan is in Houston, Texas. Hi, Dylan.

Welcome to the Ramsey Show. Hey, Dave and Jade, how are you? Better than we deserve. What's up in your world? Hey, I've got a question for y'all. I've kind of got two options. I'm working baby step number two currently with my wife. We are about $71,000 in debt.

$67,000 of that is student loans and $4,000 on a credit card. Right now we're bringing about $6,200, and I think it'll take us roughly five years to get out of that debt. So that's kind of what I'm going to label as option one. Option two is my wife can have the opportunity to travel with her job, and we would be able to kind of sell our house, pay all that debt off instantly, and then travel around for a couple more years while we save up for another down payment

and find the place that we want to stay for a while. And that option, I wouldn't work. I would raise my five-year-old and my two-year-old, maybe finding a job on the road if I got time. But I wanted to get y'all's opinion. What kind of work is it? Nursing? Yeah, well, kind of. It's echocardiac

sonography so ultrasounds of the heart but very similar to like a travel nurse okay so give me a better picture of that so is that you just you live somewhere for six months and then you move on what does that look like three month contracts um roughly about 2500 a week but they range depending but average would be about 2,500 a week. And how old are the kids? Three and five. Five-year-old and, yeah, five and two. Five and two.

Okay. Interesting. What do you do? I work for the state. Doing what? Fisheries biology. What do you make? I make $69,000. What does she make now?

She's part-time. She stays at home with the kids two times, so it ranges, but I think about $30,000 a year. Okay, so she could work full-time and make $70,000. She could. But your all's concern is that one parent is with the kids, it sounds like. Yeah, we like that. And I'm okay staying in bed a little longer.

I know that's not the Ramsey way, but I'm okay with it so she can spend some time with the kids. It's really important to her. If you were leaning towards one, what would you lean towards? Because when I look at what you're showing me, it really feels more like a values conversation between you guys. Some couples are, they want the adventure and they would say, oh, this is a great opportunity. Let's go out, go travel. The kids will learn on the road, you know, that kind of thing.

Whereas other families like the feeling of stability and being in one place. So do you see what I'm saying? Where do you fall on that line? Yeah, for me, option two. And I think that's both of us. So what our concern is, y'all just went through the housing market, right? I mean, we're in a really good spot. We bought in 2019. So we have a low interest rate. We're just not a huge fan of our area. We both love our jobs. We just want a different area. So then you've whittled this down

to it all being about interest rate. And that shows me interest rates. Or house price. Yeah. House prices are going to escalate during the three or four years he does this. That's true. But they will also have paid off debt. So you'll be saving more. So I think you can pace with that. Yes. And putting into retirement, because right now baby step number two, we're not into retirement. So this would essentially jump us into three. Yeah.

I feel like what you're leaning towards is option two, and I don't have a problem with that as long as you guys don't have a problem with it. Okay. And then I'd set clear limits. How long do we think we want to do this? And then play out the whole thing until the end. What is the whole thing look like? We do this for three years. At the end of it, we've had X amount of dollars saved, and then we can go and we think we can buy this amount of house in cash. Play the whole plan out and then ask yourself what happens if this goes well, what happens if this goes bad, and really try to fill in all those variables as best as possible on paper, not just mentally, not talking about it over dinner, but write it down so you can see, do we like this? Yeah, and give yourself permission to pull the plug in the middle of it.

Yeah. There's nothing holding you to this. Okay, three years, we're going to do five cities. Okay, that's the plan. But after three cities, you go, this isn't fun. Yeah. You would stop. You would stop, yeah.

You don't have to play all the way out. It's not a long-term play. I would not call it a decade. No. Yeah, a decade of this feels. I think I would put a limit on it. Personally, I'd put a limit on it from an economic standpoint of five years. Yeah, because what's the goal behind it?

There's only so much adventure you can stand, too. But I personally wouldn't do that. I mean, I wouldn't do that. I wouldn't do anything longer than five years. I think you're going to end up in other kinds of issues. At that point, you've got a 10-year-old and an 8-year-old, too. The point of playing that out is to say,

what is it that you're trying to accomplish with this money and with this lifestyle? What's in game and is it worth it? Is the process we're going through going to be worth it? Is the juice going to be worth the squeeze? There you go. Ramon is in San Diego.

Hi, Ramon. How are you? Hey, hello, Dave. Thank you for having me. Sure. How can we help? I mean, I don't really know where to start, so I'm just going to put it this way. I'm like $73,000 in debt, and I don't really know where to start, so I'm just going to put it this way. I'm like $73,000 in debt, and I don't really know where to start.

Okay. I mean, I got myself in this position. I'm down beating myself down to it, and I mean, here we are now. What kind of debt is it? I mean, it's a combination of a lot of things. It's credit cards, a personal loan. Give us a breakdown. How much on credit cards?

Okay. On credit cards, it's about $33,000. Okay, how much on the car? On the car, $16,000. Okay, what else? Personal loan? Okay, personal loan is $6,000, and student debt is about $12,000. Okay. The car, what's it worth if you sold it?

Just curious. Last time I checked, it was like $24,000. What do you make? I'm currently making $3,000 a month. Okay. So I just want to

clarify the car. You said you owe $16,000 and I said if you sold it, you said you'd get $24,000. Is that right? Yeah. Okay. Yeah, last time I checked like a like a couple months ago. Okay well that's good for you. Yeah. Okay so what if what if step one was we sold this car to get out of the note or you wanted to get out of the note and then you bought something in cash to free up some money what

about that? Yeah yeah that's something I discussed with my wife, too, and we're kind of on board. What's your wife make? My wife stay home. And you make $3,000 a month in San Diego. Yes. That don't work. What's keeping you in San Diego?

What do you do? Okay, so just a little background on why the situation ended up like this. So I lost my full-time job like six months ago. I ended up being unemployed for like four or five months, and I finally landed this part-time job in cost-per-pension cards in the meantime. And now I have a job, professional job again, thank God, lined up in Houston, Texas.

It's going to start next month. Oh, that's a big part of this. Oh, that kind of matters in the discussion. So how much are you going to make there? Yeah. So the first few months it's going to be like $57,000 a year plus a $500 for rent

a month. And after that, I think it's going to be they're going to bump me up to like $62,000 or $63,000. Good. A salary plus commissions is a sales position. Awesome. Excellent. So the biggest thing to worry about now is saving up for this move

because this move is coming. It's going to be expensive. I still think you need to get rid of this car because it's going to free up extra money. Are they giving you a moving stipend? Yeah. Yeah. I believe they're going to send like extra money. Are they giving you a moving stipend? Yeah, yeah. I believe they're going to send like $1,500 before taxes.

$1,500? Okay, that's not a whole lot. So I want, your homework here is to not make this worse by going into debt on a move. So you need to save up for the move and you need to do detailed research on what this is going to cost you because a cross-country move is expensive.

When do you move? They want me to be there by January 2nd. Ooh-wee. Yeah. So, yeah, you need to be delivering pizzas and Ubers and whatever else you can going crazy between now and Christmas, throwing boxes for FedEx or UPS, whatever you got to do. I want you working 60, 80 hours a week to pay for the move between now and Christmas, okay? Yeah. No, yeah, I'm actually looking for a second hours a week to pay for the move between now and Christmas, okay? Yeah.

No, yeah. I'm actually looking for a second and a third job at the moment. Yeah. I wouldn't look for one. I'd go get one today. They're everywhere. It's Christmas, dude. I mean, Target's paying $20 an hour.

Get your butt over there. So load up on that, and then list your debts smallest to largest, and we're going to pay for you to go through Financial Peace University, our class, to show you how to do all this stuff because we're running out of time, and we didn't get to give you a great answer. So you hang on. Christian will pick up and take care of you, brother. You're going to be great.

You're going to do good. I can tell. This is The Ramsey Show. 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.