The Ramsey Show - App - Can I Afford To Move Out of My Parents' House? (Hour 1)

Episode Date: August 30, 2021

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Thank you. Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, this is the Ramsey Show. It's where America hangs out to have a conversation about your life. I'm Ken Coleman, joined by my colleague and Ramsey personality, George Campbell. We take your calls this hour, 888-825-5225 is the toll-free number, 888-825-5225. Of course, we'll take your money questions. And with me being here with George, he's going to lead out on the money questions, and I'll help you with some of your work questions.

Work doesn't have to be a four-letter word. What if you could make, George, the income that you desire and also the impact? How would that feel? That's quite the proposition, Ken. You actually know how it feels. Yeah, I got there, and it was kind of an accident. And now reading your content, I'm like, oh, now you just gave me the secret sauce. I could have done this a lot faster with a lot less frustration.

That's right. So we're here together to take your calls. And let me just tell you something. You're a toll-free call away from some clarity, which will give you confidence, whether it's the money question or, again, like I said, we'll talk about some work stuff. George and I will team up on all that stuff. You've got a toxic boss. You've got some leadership issues you're facing. All of those questions.

It's open season, 888-825-5225. So let's get it started. We're going to go to Salt Lake City, Utah to get it going with Brayden. Brayden, how can we help? Yeah, hey, guys. Thanks for taking my call. I had a quick question for you. So we're on baby step six. Uh, my wife,

unfortunately her mom passed away a couple of years ago. And, um, there's a little bit of retirement money that is going to be paid out to her for the next four years. And I guess the short of it is we're wondering, should it, should, would it better serve us and our family to put it towards the house, it's our last debt, or put it into retirement and invest it? Great question. How old are you guys? So I'm 29 and she's 27. 29 and 27. And you guys were on Baby Step 6 on your own.

You guys did some work here. Yeah. Well, we're longtime listeners. My dad's ingrained it in me since I was little. Financial peace babies. That's what we call them. We love to hear that. That's amazing, man. I love to hear young people who are getting a hold of this stuff. Because Ken, you get this a lot. Man, I wish I knew this stuff when I was younger. Yeah. Yeah. Oh, they've got it. And so you guys are sharp already. And so if I'm in your shoes, and Ken, you can jump in here, but baby step six, you're paying off the house, they've got it. And so you guys are sharp already. And so if I'm in your shoes, and Ken, you can jump in here, but baby step six, you're paying off the house, you've got the inheritance.

How much money is this? Are we talking here? Well, it's going to be $50,000 total. She'll get paid $12,500 for a year. That's just how they decided to divvy it out. So for four years, she'll get that amount. Got it. How much do you owe on the house?

$220, 220. Okay. Yeah. I would go ahead and pay down the house with that. I mean, you guys are already investing 15%, right? Of your household income into retirement? Yeah. Yeah. Well, we just got a little bit of a pay raise, so we will be, yes. Okay. I'd definitely make that your A1 to make sure you're getting that 15%. And at that point, as long as you're maintaining that 15%, any extra money on top of that, I want thrown at the house. Because you do have a big mortgage there, and this is going to help. It's going to give you a little bit of momentum to get that thing paid off. And you guys are young.

I would say with this inheritance coming in, plus your incomes, you could probably get this thing paid off in the next, what, five years maybe? Yeah, we were hoping, because we were making extra payments already, we were hoping to get it done in like the next seven to eight years. Okay. Well, hopefully this inheritance helps you do it faster than that. Yeah, well, that's what we were wondering when we were just talking last night. Absolutely.

Yeah, you got it's what we were wondering. We were just talking last night. Absolutely. Yeah, you got it. George is absolutely right. This is money that, you know, it's unfortunate by which you come by it. But the $12,500 coming in every month, George, I would literally do a transfer, just drop it right on the house. Don't even think about it. That's going to fast-forward everything. It makes you feel like we can actually get this done.

And so, yeah, I do think it's an unfortunate circumstance, but this is a blessing, too, with what they've left your wife with. And so, you know, use it wisely. And you guys have already done really well. You're financial peace babies. You've learned this stuff early on. So I have no question you're going to do fine in retirement. I'm not worried about that. I want to get rid of this payment so you can attack your other financial goals.

Love it. All right, let's go to Middletown, New Jersey, where Kevin joins us. Kevin, how can we help? Hey, thanks for having me, guys. Sure. I just finished my lunch of rice and beans, so thanks for— Oh! Now, were they—okay, I got to know.

Were they red beans? Were they white beans? Black beans. Oh, black beans. George, I'm a big black bean fan. We need the recipes, you know? People are wondering out there. What's your question, Kevin?

About the seasoning the rice. Yes. So I'm a 31-year-old broke doctor. And before, so I have quite a bit of student loans, about $220,000 of student loans right now. But I moved back to my parents' house when I moved back to New Jersey before COVID, then that struck. So I just kind of fell into sort of a safe place for a little while until things started to look better in my current job situation. Now things are looking better. And I make about $ 90,000 per year right now. And I'm hoping to grow that,

but not change my current job situation because I appreciate it so much. Um, so what I was, I want to move out of my parents' house. I was hope like I've had bad roommate experiences in the past, but I understand the financial benefits of having roommates. But at the same time, I'm also thinking about creating a YouTube channel and create some passive income that way and use that one bedroom apartment for sort of a multi-purpose studio to do

those things. I was just wondering, is that a good idea? Would you guys call me stupid for thinking that, or is that logical? I'm not going to call you stupid. That's Dave's job, and he's not in the office today. So here's what I will say. There's a part career question, which I want Ken to answer, because there's a lot going on here. You wanting to start the YouTube channel, but you're a doctor, but you're broke, but you're concerned about moving out and getting roommates.

I like the idea of you moving out, and I do like the idea of you getting roommates, because it will remind you that you are broke, but you're concerned about moving out and getting roommates. I like the idea of you moving out. And I do like the idea of you getting roommates because it will remind you that you are broke. When you get your own apartment, you really think you made it, right? You go, man, I got a YouTube channel. I got my own apartment. I am living. And I want you to keep living on beans and rice. So on the financial side, I think, can you afford to move out of your parents' house? I think a 90K income, you can get an apartment in the New Jersey area with a roommate and afford it just fine. On the career side, I want Ken to speak to this because the YouTube channel part, I'm interested by because I think there's better ways as a doctor to make more money.

Yeah. We only got about a minute. She got to give me a 20 second answer. What's the YouTube channel going to be about? It's going to be like an exercise library of corrective exercise and tips and techniques to help get you out of pain. Great. I absolutely would do that and make that a labor of love. It'll take your mind off of eating rice and beans all the time because you are in that zone right now, and I applaud you. I think George is absolutely right. Move out.

That's going to give you some personal mojo. Getting out of mom and dad's house. You can't afford it. Stay with it. But understand this about the YouTube channel. This is not for the faint of heart. You've got to do it every day, every day, every day. Stay with it. Come up with a rhythm. Study people that are doing what you want to do well on YouTube. Steal like an artist.

It's a wonderful little book you should get from Austin Kleon. But yeah, I think you should do it. If we can monetize it, every nickel goes to paying off the debt. You got this, Kevin. Hang in there, man. Your best days are still ahead. He's George Camel. I'm Ken Coleman.

And this is The Ramsey Show. You know, I heard a sad and touching story recently. Zander Insurance has set up a scholarship for children whose parents died without life insurance. Last year, they gave away over $165,000 to help kids avoid debt and go to college to pursue their dreams. It's touching, but also sad since it's a situation that occurs all over the country and can be avoided in so many cases. This is the reason why I talk about Zander and term life insurance every day. It's not expensive or complicated, and it's gotten even easier with many companies no longer requiring medical exams.

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And this is how you learn about the latest money traps and trends think of George as like your consumer advocate you're knowledgeable of course about the baby steps about ready to be on baby step 7 I'm told do we have an estimated we're shooting for April 2022 so not far away for pay for house

really excited about it and tell people how old you are 32 years old 32 but if you see him in real life he looks like he's 13. Thank you. Wait, I thought that was going to be a compliment. It turned out to be a diss. I'm not sure what that was. Okay.

Good skin care. That's what it's all about. Ken, you know that. Well, you've got a great beard. Thank you. I couldn't grow that kind of a beard. See, now he's turning it around with the compliments now. You've got to do it.

You've got to do it. No, you know what? Listen, the reality is I'm in my 40s, and I see a youngster like you, and I go, man, time flies. I look at myself like a young Ken Coleman. Oh, thank you very much, George. So the Fine Print Podcast, and this is a wonderful, wonderful show. It's only 20 minutes long, so they get to a lot of stuff there. Some of the episode titles, How TurboTax is Screwing You.

Wow, George. Taking it to PG-13 right out of the gate. We're not fooling around, Ken. People are getting hurt out there. Yeah, it's now the worst time to buy a house. Could Bitcoin be your ticket to wealth? I mean, there's all kinds of great stuff here, wonderful stuff. Go check it out.

Search the Fine Print Podcast wherever you listen to podcasts and check that out. All right, does it feel like no matter what you try or how hard you work, you just can't get ahead with money? I know that feeling. I've been there before. So has George. But you don't have to live like that. If you're sick and tired of being sick and tired, today's the day to decide you're going to do something different. Financial Peace University is the step-by-step plan that's helped nearly 6 million people pay off debt and take control of their money.

Combine that with the premium version of EveryDollar, the world's greatest budgeting tool, and you will make progress right away. And it's only available with a membership to Ramsey Plus. Everybody's got a plus now, George. You've got to have it. And so, of course, Ramsey Plus is our plus. Today is the day you can decide to break the cycle living paycheck to paycheck. This month only, we're taking $30 off the price of a 12-month membership to Ramsey Plus. Start your free trial of Ramsey Plus today by texting TRIAL to 33789.

That's 33789. All right, the phones are open. 888-825-5225. I can talk to you about your work. Moving up the ladder, George. That's called a bigger shovel. Stage five of my seven stages to doing what you were born to do is get promoted. Let me tell you something, George. If you're going to get promoted, you're probably moving into leadership. Some of you are going, I want to get promoted. I don't know if I'm ready. We can talk about all that.

You got a phone call around that area. Of course, your money questions. The phone lines are open. 888-825-5225. Paula is up next in Greensboro, North Carolina. Paula, how can we help? Hi there. I'm actually calling to tell you how Dave Ramsey made my life a better place. Awesome. What happened? About 2003, my husband and I moved into a house we built, and we were always nervous about his job being eliminated. He worked for a manufacturing firm.

And about, I don't know, maybe it was 2005, it all kind of runs together. He introduced me to the Dave Ramsey Show. Long story short, we ended up paying off the house. Wow. We had this house custom built, and we took the big shovel that I had at work, and we paid off the house. What? So we've been debt-free for a while. Paula, how much was that house?

We mortgaged about $125,000 because we'd already paid a lot down on it. What's that house worth now, do you think? Oh, gosh, I think that was in, what did I say, 2005-ish. And so now I think it's another $75,000 more. That's awesome. So what's the key? People are listening. You start listening to the show, and you just start getting gazelle intense.

And I'm sure if Dave were here, he'd say, well, he didn't do anything. You did it. You and your husband did it. What's the key? Well, we were scared about his job, and we just didn't want to have to worry. Right. And long story short, we didn't have to worry. My job, which had the big shovel, was eliminated about 2011.

Wow. And I took the severance and threw that in the bank, and we've got a good financial guy that helps us and helps teach us. And so now we're at 2013. I'm diagnosed with multiple sclerosis. Oh, no. But we don't have any debt. So when I leave that job and go on disability,

then we only have to keep the lights on. And because we had taken the money that we'd earned in the big shovel that I had, and we didn't have any debt, we were able to put that money in investments and have that money ready and waiting when my husband was able to retire at 57. Wow. In 2020, right in the middle of the virus. So not only did we not suffer, so our version of living like nobody else so you can live like nobody else looks like this. I go from a six-figure income to disability. My husband retires at 57. We're living in a paid-for house. My husband and I are living off of the interest and much less because you can do that. You can do it.

When you don't have the debt, you can be at home and retired at 55 and 57 years old. That is amazing. I love it. Paula, we are so proud of you. And, George, you hear a story like this. And by the way, she's just laying it out. Testimonial after testimony on their journey. If you see

what would normally be a massive crisis for somebody. It's not a crisis. Even she's got some physical challenges, you can tell it's not holding her back. I didn't hear stress in her voice at all. I felt a beautiful, calm demeanor. It was very relaxing.

I could have listened to her all day long. I know, right? It was so great. She's like, let me tell you one other thing. Yes, I'm here for it. Paula, way to go. You guys are crushing it, and you're just proof that this plan works for anyone,

and a lot of people think they're special, Ken. They go, well, it's not for me. You don't understand my situation. Look at Paula's situation. They overcame a lot of obstacles, and they decided to give themselves some options instead of tie themselves down to debt because everyone knows you got to have a mortgage payment, don't you, Ken? Yeah. Well, no, you don't. You don't. Let

me tell you something. In today's real estate market, I mean, imagine how some people are cashing out and still have room left over to do something. I mean, it's just amazing what's going on right now. And that is a major real estate asset. Not just your home, but, I mean, it's an amazing situation. In their situation, they've got a lot of financial options and still relatively young, George. I know you can't picture this, but 57 is not old. You got a lot. I mean, people are living to be 100, Ken, with all the healthcare these days and we're learning some things. I'm hoping to live to 100.

Are you really? That's my goal. I'll keep the bucket at 100. You're a very clean eater. I'm gluten-free, guys. That's the key. Anti-inflammatory diet. Now, is that because you choose to or because you have to? You know, it is an intolerance, but it's also a choice. I love that,

by the way, Kelly. I'm looking in the control room. Kelly and I are the exact same age, so I can't tell you how old I am today because she'd get mad at me. Don't say anything, George. I was going to spill the beans. But only a millennial Kelly would say that. It's an intolerance, just the way you say that. You know what I mean?

But, George, I'm glad you're taking care of yourself. Thank you. But you're a guy who's on the edge of this deal, too, and you're going, I'm hoping to pay my house off in about six months or less. What does that feel like right now? You're not there yet, but that's going to be pretty amazing for you. Yeah. You know what it is, Ken? It's once you really set big goals for yourself, the house payoff just becomes a part.

It's a milestone. It's not even the end game. We're going to celebrate it, and then we're going to go, okay, what's our next big thing? And you do that when you get on the same page with your spouse, who, by the way, she works here. We met here at Ramsey Solutions. We've been married almost three years now, and she was more intense than I was.

And once you have that kind of fire, you just start to dream. You start to go, what would life look like if we didn't have any payments in the world? What would we do? And that will keep you going for the rest of your life. Got to have to dream. You start to go, what would life look like if we didn't have any payments in the world? What would we do? And that will keep you going for the rest of your life. Got to have a vision. Love the call, Paula. I'm so proud of you. Thank you. I know you encouraged so many people. Please pass along George and I's high fives to your hubs. The best is yet to be. And you know what else is to be? More of your calls coming up. Don't move. This is the Ramsey Show. Dave here.

We just launched a brand new listener survey. We want to know what you think about the show. You'll be entered to win a $100 Amazon gift card. No purchase necessary. Take the survey at RamseySolutions.com slash survey or text survey to 33 789 the ramsey show continues from our national headquarters still to have you with us i'm ken coleman joined by my colleague george campbell we're taking your calls this hour it is a free phone call. What are you waiting on? 888-825-5225.

We'll take your questions about your money, your life, your work. Are you working on purpose? George, you know this. I'm crazy passionate about helping people discover what they were born to do because there's just more to work than just a J-O-B and a paycheck. And so if you've got questions about moving, you're going, I'm in the baby steps, can I change jobs? Can I make a transition while in the baby steps?

The answer is yes. I'll tell you how to do it. In fact, if anything, I'm trying to help you do that so you can get a bigger shovel and get out of debt faster. So we'll take those calls as well. Let's get it started off this segment with Jonathan, who joins us in Louisville, Kentucky. Jonathan, how can we help?

Hey, good afternoon, gentlemen. How y'all doing today? We are living the dream. What's going on? Glad to hear it. Okay, so this is my situation. So I'm trying to get everything in order. I bought a house last October.

The first year is coming up, so I'm trying to get everything squared away with the 15-year plan to have it paid off. But I still have a little bit of debt. I have about $8,000 that I owe on my car, and I have about $6,000 in credit card debt. So I'm thinking about just paying it all off so I can just focus on my house. And I'm just, I don't know if that's a smart move or not because I don't want to, you know, if I need an estate built for my savings, I don't want to, you want to put myself in a twist at the end of the day. Put yourself in a twist. I like that turn of phrase, Jonathan.

Well, let me start with this. Do you know the baby steps that we teach? Yes. So we teach you to first have that $1,000 starter emergency fund and then tackle the debt, then get that fully funded emergency fund, and then we move to 3B, what we say, for the house. So it sounds like maybe there was some things done out of order here, and that's okay. We can clean this mess up. But how much do you have in savings? About $35,000. $35,000? Yes. How much of that is your actual emergency fund? How much do you need for three to six months of expenses? Give or take $5,000, $6,000. Total for your three to six months emergency expenses? Give or take five, six thousand. Total for your three to six months

emergency fund? Yes. Oh, yes. Like six, seven thousand. Yes. Well, that leaves us with some really good news. If you have thirty five K in there and you only need seven for the emergency fund, you can pay off all your debt. Hold on a second, George. Jonathan, are you telling me that three months expenses is $7,000 for you? Yes. Yes, my mortgage is, yes. Okay. I just wanted to make sure that's really – Not three months.

I'm sorry. About four to five months. About four to five. Not 7,000 in three months. Like four to five months. Okay. Something's still not adding up. So you're saying your monthly expenses are about, what, $1,200?

What are you running with the mortgage and everything to keep the lights on, feed yourself? $1,350 for the mortgage. About another, what is it about? About another grand for the expenses for the house. So $2,000, $4,000, $6,000. Yeah, that's about right. Yeah, that's about right. $6,000, $7,000.

Oh, so you're saying $6,000 or $7,000 per month for expenses? Yeah, per month. Okay, so we need to multiply that out to Ken's point to get to three to six months of expenses. So the answer to the question is $21,000 minimum, Jonathan. That's what you're... Pretty much, yeah. There you go. Which is perfect because you just told me you've got $14,000 in debt and you need $21,000 for the emergency fund.

So to me, you make the calls as soon as you're off the phone with us. You go pay off that credit card. You go pay off that car loan, which is going to free up a whole bunch of money for you to actually pay off this house in 15 years or less. Does that sound right? Gotcha. It does, yes. Okay, and I want to make sure you're also investing 15% of your income into retirement. Have you begun that?

I have, but I'm not doing 15%. I'm at 10% right now, and then with the 401k, I'm putting 10% in that as well. Okay, normally I'd tell you to pause the investing, but because you're going to pay off this debt today, I'm not concerned with that. What I want you to do, though, is before you start attacking the house, pay off all this debt today, increase that investing to 15% of your household income total into a good retirement account, depending on your situation, maybe an IRA or 401k, Roth, if you've got either of those options. And then whatever margin is left over, throw it the house and pay this thing off. I think you can do it in less than 10 years. You seem like a hardworking guy.

Definitely. I make $70,000 a year. I feel like I can afford it. It's just hard to let go of the money. I mean, that's a lot of money, so it's just kind of hard to let it go. Oh, I get it. But you know what else is hard? Looking at those payments disappear from your bank account every month instead of going to your goals. So I think you've got a few things backwards, but you've got so much going for you, Jonathan, and I want you to do things in order. That's what we teach is the baby steps.

So pay off all this debt today, clean this mess up, get to 15%, and then you'll be paying off that house with total freedom and no payments in the world. Yeah, it's going to feel so much better, Jonathan. You've just got to focus on the big picture, not the immediate. And so what happens is, George, somebody's got a lot of money, in his case $35,000 in the bank, right? And so the immediate focus, it's this kind of like tunnel thinking. Oh, man, it's $35,000. I don't want to cut a check today for $14,000 and watch that drop to $21,000 or whatever the situation is.

It is emotional. But the big picture is, wait a second, let's get outside of that bank account and go, what does this do when I pay off this debt? How it fast forwards everything. He's making good money. Now he's through baby step four. Now he's just rocking. Yeah. And people don't understand the momentum that you get when you do the steps in order.

Because, Jonathan, you're trying to do a lot at once right now. You're trying to pay off the debt. You're trying to invest. You're trying to pay off the house. And what happens is you lose steam because you go, well, I can't do it. None of it's really moving. I'm not to pay off the house. And what happens is you lose steam because you go, well, I can't do it. None of it's really moving. I'm not moving the needle. So once you start doing this stuff in order, you're going to gain a ton of traction,

and you've got a great income to get that done. Yeah, really good stuff there. Thank you so much for the call. Let's go to Matthew now in Louisville. It's Louisville Day. We're going from Louisville to Louisville. Matthew now joins us. Matthew, how can we help?

Hey, Ken. Thanks for taking my call, guys. I lost my job a few months ago. Sorry. It's all right. I think you would have told me it was toxic anyway. So I've been in manufacturing ever since I've been working, which has been about 10 years. And so I feel like this is a time for me to do a career pivot, I guess.

I did take your career assessment. Oh, good. And I believe that it was pretty spot on. What did it tell you? Where is it leading you? To me, it's leading to protective services and maybe law enforcement. Interesting. Is that something you've wondered about in the past?

Honestly, Ken, it's something that I've always wanted to do. Yep. And so you took the Get Clear Career Assessment. When you read your purpose statement, it pointed right at that? The purpose statement, I would have to find it. No, no, no. I'm not making you read it, but the point is you took it and you were like, wow, this confirmed a lot for me.

Yes, sir. All right, then. So what's your question? Because it sounds like to me this is something you've always wanted to do, and now you're clear that law enforcement protective services is something you were born to do. It allows you to use your talent to perform your passion to accomplish your mission. So what's the question? Well, so the hiring process is time-consuming. Yes, sir.

So in between, I'm having a hard time. I've had a few interviews for different manufacturing jobs and stuff, and I just won't get any. I i'll get denied and then i'll find out next day that they're still looking for for new work or whatever and i'm like man what's wrong with me how come they couldn't kick me so i don't know if there's if i'm going in there i'm trying to go in there as best you know as i possibly can um but i don't know if i'm going in there and there's a chip on my shoulder or because i have a hard time wanting to go to another factory. Another thing is whenever I get into something like a job, I hardly ever quit it.

Well, now here's the deal though. Okay, so let me just tell you what's going on. I think you do have a chip, but I think it's coming out because you just self-identified it. But here's the deal. All you've got to do, whether it's another manufacturing job or not, you have got to go take care of yourself in the short term so that you stay afloat and you're stable while you move into the qualifying process of getting into a local police department or sheriff's department. Because those process, even if it's on the federal level, you know this, you just said it, those take a while. So right now, your whole mindset needs to change.

You need to take the chip off the shoulder. If you've got to go to manufacturing or go work in some other day job, it's a day job. It's only to keep you stable while you move into the dream job. That's the great news, Matthew. You know what you want to do. You know why you want to do it. You know how to do it.

So here's the deal. Shake the tree. Shake the tree. Shake the relationship tree. Go get a gig. Go in with a great attitude. And you're going to quit it when you get qualified and you get started and walk right into that law enforcement job. Thank you so much for your heart. Thank you for the service that you want to do for your fellow man.

You got this. All right, George, we've got to take a quick break, but we're not going anywhere. Your phone call is next on The Ramsey Show. Welcome back, America. You're joining the conversation here on The Ramsey Show. I'm Ken Coleman, and I'm joined in Studio the Shower by my colleague, George Campbell. Well, I guess it's the latest, the newest Ramsey personnel. And greatest.

Sure, I'll throw that in there. I'll take it. Yeah, you're fantastic. Yeah, we weirdly hit number one in the business space on Apple Podcasts on our launch week, which was a huge honor. So thank you to all of you who have downloaded, shared it, told your friends. The Fine Print Podcast. We just released a new episode, Ken. What is it?

What's the title? Oh, this is a good one. After Pay, Affirm, Klarna. Should You Buy Now, Pay Later. That's what it's all about. And this is a big trend we're seeing across every single website you can buy things. Right under the Add to Cart button, there's a, hey, we can take the price down by 75% if you make four easy payments. You remember those old commercials?

Oh, yeah, of course. So this is the modern version of installment payment plans. And tons of people are falling for it, Ken, because you go, wait, I got $200 in my cart. They're saying I can just pay 50 today wow which means I can add more to my cart and this is only a 20 minute show 24 minutes we unpack this yes so this particular show is 24 minutes we interview uh Nathan Hamilton from The Ascend uh which is from The Motley Fool and they did a survey with 1800 people digging into buy now pay later uh turns out 38% of people are using it to make purchases they can't afford.

Shocker. Oh, boy. Right? So this is a great show. You need to download this, subscribe wherever podcasts are available. And I want to mention really quick my brand-new book, From Paycheck to Purpose, The Clear Path to Doing Work You Love. It unpacks the seven stages that will lead you to doing what you were born to do,

making the income you desire and the impact. It's available for pre-sale right now at Ramsey Solutions. For only $20, you get the book, From Paycheck to Purpose, plus the audio book, the e-book, and over $100 of amazing goodies. And then we have a bundle there that for only $30, you'll get the brand new Get Clear career assessment that our last caller just talked about. And that's going to give you tremendous clarity. It's like the compass, and then it shows you the mountain. This is the dream. And then the book is the guide up the mountain.

So you can get the bundle or just a special price on the preorder of the book. It comes out November 9th. Go to ramsaysolutions.com. I'm preordering. I'm doing it. Are you? Are you going to do that? You read the audio book,com. I'm pre-ordering. I'm doing it. Are you? Are you going to do that? You read the audio book too. I haven't done it yet. It's coming up. Well, you will be.

Oh, it's great fun. That's worth the price of admission alone. I love a good audio book and I love following along with the book. So that's why I love these bonuses because I have the physical book and then you're reading it to me. Oh, so you're one of those guys. I'm one of those guys. It helps me stay focused. Fascinating. Yeah.

Yeah, really interesting. But I'm pumped about this book, Ken. Truthfully, I think what Total Money Makeover did for people's financial lives, this book, From Paycheck to Purpose, is going to do that for people's careers. We certainly hope so. There's just so many people that are moving on this year. The great resignation, they're calling it. And I think it's really the great search for purpose.

So we think we're hitting the wave at the right time. All right, let's get to the phones. 888-825-5225 is the phone number. Let's go to West Palm Beach, Florida, where Heather joins us. Heather, how can we help? Hey, how are you? We are living the dream, Heather. What's going on? I love it. So I got myself into a bit of a pickle years back. I did a debt reduction program. Oh, cool. It sounds like a great idea. You'll pay off part of my credit cards, not knowing they were going to kill my credit and what was going to go along with that.

So I've been working with a program to deal with the creditors and all of it. And I'm just not sure where to go from here. I'm like, I guess I'll leave it at that. Well, you being in a pickle, Heather, there's a way out of this. And the key is to stop focusing on the credit score. So let me ask you this. Why do you need your credit score to be higher? I'd like to buy a house, buy property,

and I don't know. I'm looking to get married, and I don't know that it will influence anything in our relationship moving forward. Hold on. You're saying your future... Do you have a fiance, a boyfriend? I do. Okay. And you're saying, hey, this guy's not going to marry me if I have a low credit score. No, I'm not saying that at all. I want to take personal responsibility for it. And I don't want anything related to that to negatively influence him. Well, the best thing you can do for your future, for your marriage, for buying this house is to get rid of all the debt you have. And what happens when you do that, and I experienced this myself when I first started working here at Ramsey and paid my debt off, is that your credit score doesn't go to zero. It's impossible. Well, what happens is it becomes indeterminable. It's

a $10 word that means it disappears. You're basically invisible to the credit bureaus. So how much debt do you have? Heather, are you with us? That truth just shocked her into oblivion. Oh, we'll see if we can get her back. So Heather, we'll give her one more shot. Heather, Heather, Heather. She disappeared. She went invisible.

Ken, look at that. I think I spoke it into existence by accident. Oh, that would be really creepy. Yeah. Or she fainted. I think the idea that her credit score would literally disappear into the ether, I think she fainted. It was too much. Well, if she's still listening, let me finish by saying –

Well, yeah, play this out because, okay, let's say she does that like you did. So here's the thing. People go, I've got to get my credit score up, and I'm going to work with these programs and debt reduction, and most of these are scams. And like Heather found out, it just tanked her score. It's not super helpful. And so what is helpful is taking control of your own situation and cleaning up the mess that's really the only way to do it there's no magic wand they can go here's an 800 credit score overnight and so what i want you to do heather is pay off all of this debt and your credit score will soon be

indeterminable after a little while and then you can do what's called manual underwriting or a no score loan when it comes to getting a house. So what that is, is like the olden days, Ken, not that you're old enough to remember this, but back in the day, they didn't have credit scores to look at to give you a mortgage. So what they looked at was your actual financial situation. And they went, wow, you've got an income, you've got a steady job, you pay your bills on time, your utility bills, your rent, whatever it is. And they go, all right, here's a mortgage. So on that front, Heather, you're going to be just fine.

And I can tell you that because I went through this exact process not having a credit score. All right, so here's the good news. Heather is back with us, we hope. Heather, are you there? I'm here. Did you faint? Maybe. I don't know.

Some technology somewhere was like, she can't hear me at all. The devil's in the wiring. All right, so George, take over. So, Heather, how much debt do you have? So, I feel like I can't even fully answer that. Where the debt was at when the program started and then it went up, I couldn't tell you what the total is. Well, that's A1. We've got to figure out how much money you owe if we're going to pay this thing off.

So, I mean, can you give me a ballpark? I think the one might be $9,000 and the other might be at like $3,500. So, total of that is, let's highball it and say $13,000. Yeah. Okay. And what's your income? My income is about 45 a year. Okay.

And here's what I want you to do. I don't know how soon you're going to get married, but I want you to start cleaning up this debt on your own. No more programs. Stop looking for a solution outside of yourself. You are the solution. And that's some really, really good news. And like I was saying to Ken earlier when we lost you there, once you start paying off your debt, your credit score is going to become indeterminable, meaning you're invisible to the credit bureaus. And I'm not worried about the house because we've

got great partners like Churchill Mortgage. There's a ton of mortgage companies out there that will do this thing called manual underwriting or a no-score loan, where they just look at your real financial picture and they go, all right, Heather has a real income. She's got a steady job. She pays her bills on time. We're going to give her this loan. And I want you to do it in the Ramsey parameters of a 15-year fixed rate mortgage that is no more than 25% of your take-home pay. So once you do that and you have a healthy down payment and you're probably even married by then is something I imagine. And so you're going to have what we call dual income, which is a beautiful thing, Ken. You've got a lot of power once you get this.

Double income, no kids is where we start making major, major progress. That's huge. Heather, here's the deal. Listen, Heather, relative to the amount of money you make and the debt you have, you can get out of this really, really quick. So I appreciate the call, but you don't need to be worried about your credit score. You want to get out of debt, and this is going to set you on a great path for the future that George just so beautifully described. So you got this, kiddo. I mean, my goodness, this is just about getting out of debt. I mean, $13,000 in debt for somebody that's single, making $40,000. You pick up a side job, and you get your budget. And hang on the line. Let's get

her in Ramsey Plus. I love that idea. Let's give her a free trial to Ramsey Plus, Kelly, because you need to get control of your money. She's not even sure how much she actually makes. There's your first problem. So, let's go look at the pay stub and go, here's my gross, here's my net, now I know what I'm actually working with. I can go exactly into the budget.

Ramsey Plus is going to get you started. It's going to set you free. Good stuff. Hey, I want to thank my colleague, George Campbell, for hanging out. I want to thank our producer, Ben Hill, and our associate producer and call screener, Kelly Daniel. Hey, I also want to thank you, America, because we do this show for you. This is the Ramsey Show. Dave here. We just launched a brand-new listener survey. We want to know what you think about the show.

You'll be entered to win a $100 Amazon gift card. No purchase necessary. Take the survey at RamseySolutions.com slash survey or text survey to 33789.