The Ramsey Show - App - Comparing ESAs and the 529 Plan (Hour 1)

Episode Date: January 1, 2019

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Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. The phone number here is free, and some say the advice is worth what you pay for it. The phone number, 888-825-5225. That's 888-825-5225. If you're looking for boring financial talk, you're in the wrong place. This is not your mother's 401k meeting. This is life on the radio. And it's just downright entertaining.

That's why there's about 14 million of you out there today. Thanks for hanging out with us, America. We're glad you're there. Michael starts off this hour in Tampa. Hey, Michael, how are you? Doing well, Dave. Happy New Year. Thank you so much.

And I just wanted to thank you for all your guidance throughout the time. Anyway, let me get to my question. My wife and I are pregnant pregnant and we're having our first baby. So that's very exciting. Yay. Thank you. We're currently on baby step six. We're trying to take a bump back to baby step five. And I'm just curious on an education savings account versus a 529. We're not, we just are aware that there might be a chance that our kid may not choose higher education for whatever reason roughly 20 years from now. And I just want to know – I don't want to get hit on trying to get that money back out if I don't need it, but just trying to, I guess, compare the two and find out what's going to be the better solution.

Okay. Well, they're the same as far as that issue goes they're both going to be highly penalized if you take money out of there and don't use it for um higher education if you get scholarships you can pull the money out equal to the scholarships with no penalties but uh and so there's no danger with athletic or academic scholarship or any other scholarship for that matter uh you can pull the money out and it doesn't get trapped that way. It can be passed to a sibling if they don't, and maybe a sibling goes to college. And this is on both of them either one?

Yes, they're both the same in that regard. The ESA is limited to $2,000 a year, and you have to pick an investment that goes into that. Of course, we recommend good growth stock mutual funds. And then the 529, both of them grow completely tax-free. They're like a Roth IRA for college. The 529, the only problem with it is there are several types of 529s, and sometimes people get in the wrong one. The only kind of 529 we would ever let you to get in or recommend you get into works exactly like the ESA,

and that is you pick the mutual fund that it's in, and it doesn't change unless you change it. And you can change it anytime you want. And that's true of the mutual fund selection inside the esa as well now 529 is actually if you've ever heard prepaid college with some of the states that's technically a 529 program and we would never recommend that not a good plan at all but as long as you're picking and controlling the investments i would do it so here's what i would do okay i i would start with the two thousand dollars when the baby's born. You can't really mess that up.

Okay, it's going to grow a lot of money later, and it's not the end of the world. The next year, probably going to do another $2,000 if you're worried about this idea that the child may not go to college. Now, of course, our children were, you know, we were doing this before there were ESAs or 529. So we just had mutual funds in their name called an UTMA that was their college fund. But we always just talked to them their whole life about this is your college fund. This is your college fund. This money is your college fund. This money is your college fund. Technically, the UTMA doesn't have to be used for college.

It's just in their name. But we brainwashed them and pretty much they, you know, it was kind of in sales we call it an assumptive close. We pretty much assumed that they were going to school at least four years and get a degree in something that's, you know, usable, not, you know, underwater BB stacking or something. You know, I mean, we need to get a real degree that actually has use in the marketplace. But if you do that, there's all kinds of data that says you make more money and have a more fulfilled life. I'm all about education. I'm just not about stupid education. And we've got the culture has gone bananas, and that's the stories that we're hearing. These people that get these degrees in obscure things that are completely useless.

And the degree has to have a utilitarian aspect to it unless you pay cash for it and you just enjoy being educated for some reason um you know it's a good thing to be educated but you just want to go to school to just go to school that's a different kind of a person than the neighborhood i grew up in so um yeah it's good it broadens your horizons you grasp other things in life i understand i'm educated but um you know academics for academics sake alone is uh it's too expensive for that luxury for most people now anyway you got a new baby coming start a college fund dude it's not gonna kill you i mean it's not you're not gonna go broke if the thing turns into 40 000 and you give 10 000 of that the government because the kid doesn't go to school you'll be

okay you'll be okay and you'll know a lot more about this, about the life that the kid is going to lead and so forth as you go along. And very cool stuff. So, hey, thank you for calling in. I'm going to give you a copy of our book, Smart Money, Smart Kids, which is for parents on how to teach your kids how to handle money. And we'll make that the first birth gift that you guys get. Hold on. I'll have Kelly pick up and we'll give you that. Monica is with us in San Francisco. Hey, Monica, how are you?

Hey, I'm great. What an honor to talk to you, Dave. I appreciate all you do, and I'm inspired by you on a regular basis. Thank you. How can I serve today? So, I'm looking for advice regarding my husband's pension plan. He's 61, and this is a pension plan from a previous employer, and they've given him the option, a cash-out option, which would amount to about $171,000 versus a monthly joint annuity amount, which is like $750. I'm wondering what you would recommend. I would recommend rolling it to an IRA in a direct transfer rollover. There's no taxes on it when you do that.

And here's why. Okay. All of the calculations, there's a calculation in finance called your net present value. And what you do to get net present value of a stream of payments, you've got $750 a month coming from now until he dies. And they estimate his age date with actuarial tables, life insurance tables. And then they plug in an interest rate to determine what that lump sum is. The interest rate that they plugged in 99% of the time is right around 6%.

And so if you take their payment program, you're making about 6% on that lump sum if he lives an average length of time, a typical length of time. Now, if he dies sooner, you made less. If he lives longer, you made more. Okay? But we don't know that, but we're just going on averages. Okay? but we're just going on averages. So anyway, if you invest it at above 6% in good growth stock mutual funds, which the four funds that I recommend you put money into, mine have averaged over 13% for the last 20 years, average annual return.

And so if you were to invest it like that, you would make double what you're going to make now on it while he lives. Here's the big thing, though. When he dies, the pension's gone. Or when he dies, you got $170,000 if you do a rollover in your IRA. The money doesn't die with you. And so it's better while you're alive if you invest it well, and it's better when he dies 100% of the time because it's zero or all that money.

So I always take the lump sum rollover and put it into a good IRA with a series of growth stock mutual funds with one of our smart investor pros. This is the Dave Ramsey Show. Your goal this year is to get rid of your debt, but here's the deal. In order to keep your momentum going past January, you have to make small changes that get quick results. That's why you need to attack your debts smallest to largest.

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Call Churchill today at 888-LOAN-200 or visit ChurchillMortgage.com for your Churchill Checkup. This is a paid advertisement. NMLS ID 1591. NMLSconsumeraccess.org. Equal housing lender. 761 Old Hickory Boulevard, Brentwood, Tennessee 37027. thanks for joining us america trevor is with us in utah happy new year trevor happy new year to you as well how are are you? Better than I deserve. How can I help, sir? Thank you.

My wife and I just recently started Financial Peace University and hit Baby Step 1 last month, and we're currently working on Baby Step 2. Great. Our question's about basically credit card debt and what we should do. We need $19,000 in credit card debt, $10,000 in medical, and $32,000 in our cars, unfortunately. And with minimum payments, we're just kind of falling behind, so we had to protect our four walls and start on that and start making minimum payments. And with that, through my car payment, which is on time and up to date, my credit card is with the same bank, and so they're saying that it's collateral against

my car and they can repossess it. So they're kind of working on that, too. And so I'm just kind of trying to figure out options on where to go from here. What's your household income? We take home about $5,000 a month. You need to sell some cars, don't you? Yeah, we do. But unfortunately, we're upside down on them because my wife and I both rolled over previous cars into these new cars.

Okay. And so which one's the most expensive? They're both about $16,000 right now that we own them. The one I'd take on first is this bank that's misbehaving, and I'm going to get those people out of my life. You don't have any checking with them, do you? No, we don't. Good. Who's the bank it's america first the local credit union here in utah yeah okay um well i would get everything out of them as fast as i can since they're being butts um the other thing i do sit down with them in person and go um you know what you've got this

credit card debt that's unsecured you've got a portion of this car that's unsecured. Why don't we put that on an unsecured personal loan? Let me sell the car and let's get rid of it. Let's get rid of some of the debt. Sit down with them in person in the manager's office. Okay. Not by email and not over the phone. Because they have an unsecured loan.

What's this $16,000 car probably worth? Right. What's it worth? I haven't looked. It's probably around $12,000 maybe at that. Okay. All right. So they've got a $4,000 unsecured loan and a $12,000 car loan plus a credit card debt.

How much is a credit card debt? It's about 2500 okay so they need to make you a 6500 personal loan and let you sell the car okay and that'll get rid of one car and it'll get it off of credit cards right and you'll just have a little personal unsecured loan with them which is what they've got now they don't have security now the only security they've got now. They don't have security now. The only security they've got now is a $12,000 car, right? Right. And they've got $6,500 approximately in unsecured debt right now.

All we're doing is admitting that. So if they balk at all, just try to remind them of that and rub their nose in it and go, this is an unsecured loan anyway, Bubba. And let's start clearing that off because you can't the problem is these car payments are killing you guys and you can't even make your payments right so you've got to get offload some of the debt just to get in balance again so you can begin to make progress instead of systematically going behind every month right you're making the right choice to do the four walls first,

but that's a temporary thing. That's not a long-term strategy. I'm going to survive this month and do the right things like eat and keep my lights on before I worry about a stupid credit card. But, you know, then immediately you go, I'm going to sit down with this bank, I'm going to get this car sold. Who's the other car loaned with? It's through another credit union here in Utah University.

Probably do the same thing with them then. Let's get us a couple of $1,000 cars and drive them until we get this mess straightened out. And then the other thing is you stop anything coming out of your check. You know, stop your 401ks, stop anything like that. Let's try to get as much money home as possible to pay these bills. And, of course, start looking for extra work, anything you can do, you know, delivering pizzas, driving Uber, whatever. And, you know, that makes a lot of sense. You get another $1,000 a month coming in, and you adjust some of these other things, you can clear this debt pretty quickly.

But we've got to get back on top of it here, and it's going to require some steps in those directions. But I'd say both those cars need to go because I'm guessing they're probably high interest rates too, it sounds like. Sounds like they're bad deals all the way around. You got stung. You had car fever. So hope that helps, man. Thanks for calling in. If I can help you more, you let me know.

I think you can do this, but you're going to make some pretty dramatic steps because you're in a pretty dramatic situation. Brittany's with us in Tulsa, Oklahoma. Happy New Year, Brittany. Happy New Year. How are you? Better than I deserve. How can I help today?

Okay, so for Christmas, my in-laws gave my husband and I each some money for our Christmas present, and we are in baby step two trying to pay off our debt, and my husband and I are trying to figure out if it's okay for us to spend this Christmas gift on us or put it towards our debt. How much was it? Between what they gave us and what other members. Now, what did they give you? They gave us $500 total.

$250 each? Yes. And what's they give you? They gave us $500 total. $250 each? Yes. And what's your household income? About $60,000, $65,000 take-home. And how much debt have you got? About $20,000. Okay. So what do you guys think you should do?

We can't decide. We keep going back and forth. We're doing FPU right now, and we just said the opportunity costs it less, and so that's everything we keep saying that. And so I joked to my husband yesterday. I said, I'm going to call Dave and ask him what he thinks, and he said, okay. So we keep going back and forth. How old are you guys?

I'm 26, and my husband's 25. Cool, very cool. Well, I'm glad you're going through FPU. That's neat. And it sounds like you're starting to wrestle with some of these issues, which means you're probably going to win at some point if you uh if you don't lose the wrestling match but um so uh what if out of 500 what if we took a few dollars each and did something and then threw the main part of it at the debt okay that's that was one of our ideas too that

way we don't completely deprive ourselves yeah i'm not worried about you depriving yourself i am worried about um you having to look at your mother-in-law over dinner and go and put it all on the debt yeah she would probably be mortified if we put it towards that well she wouldn't be if she saw you were actually heading in the right direction hopefully she's got a bigger mind than that. But, I mean, it's a gift after all, which means you should be able to do with it. If you want to give it away, you should be able to give it away, right? It's a gift.

But, you know, if you feel like they would be completely mortified, then you may want to actually place a phone call to them and tell them you're working a plan to get out of debt and thank you so much for the gift because it's going to accelerate our debt reduction we're excited about that but we are going to spend a little bit on us but we're living like no one else so later we can live and give like no one else because we want to be able to give like you guys give and just turn it back just let them know you know so that they're not surprised but i'm going to spend a little bit on you. Like I'm thinking $25 a piece or something. Okay.

Like 10% of the $550. Okay. And then something like that. I mean, you can figure out what it is. But what that says is, always think about it this way. Jesus said your treasure is where your heart is, right? Yes. So the way you handle this money says what your attitude is about the process that you've engaged in through Financial Peace University. The more of this money you throw at it, the more serious you are about cleaning the mess up and getting out of debt, right?

Yes. The less of it is is the more you're like oh this is kind of a neat idea you know well it's not a neat idea it doesn't work when you do that so you know you this makes a statement about your your all's attitudes towards this that's why i like that you're wrestling with it because you know a year ago you would have just spent it on you oh yeah see that tells me you're that your your heart is in a different place today than it was because you're asking the question in your wrestling you see why that's good yes proud of you i think you're going to do well uh that's what i would do because i want to represent that my heart is i'm cleaning up the

mess i'm going to live like no one else so later I can give like no one else. Children do what feels good. Adults devise a plan and follow it. And so I'm going to do a little bit of the enjoy the Christmas gift and a tip of the hat to the mother-in-law. And I'm getting out of debt. A few years ago, I probably would have told you to put it all on the debt, by the way. I'm kind of getting to be an old softy now.

Well, maybe not. This is the Dave Ramsey Show. Okay, things are getting pretty weird out there. I thought the Equifax breach was bad enough. It exposed the personal financial info of half of all Americans. Now we have breaches affecting almost every U.S. citizen, and the data stolen is more personal and equally dangerous. One company had over 230 million consumer files hacked, which included not only the home address, but info related to religion, pet lovers, smokers, you name it. And the businesses were not any luckier this time, with 110 million files hacked.

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This is the Dave Ramsey Show. We're glad you're here. Our question of the day comes from Blinds.com. They're the number one seller of online blinds and window coverings. You get free samples, free shipping, and with new promos every month, you save money. That is if you use the promo code, the magic word, Ramsey. Blinds.com. Shane is in Wyoming.

My wife and I own 300 acres of mineral rights in Oklahoma. We currently have $18,000 in debt and want to buy a house. Once that's gone, we can sell the rights and get a lump sum of around $300,000 or continue to lease them and get about $20,000 every three years. Should we take the lump sum and pay off the debt and buy a house or continue with the lease and add that to our income? Well, if you said we're making $6,500 a year, $20,000 every three years, on $300,000, that means you're making 2% on your money. That would be what's known as a lousy rate of return on a high-risk investment, which by all accounts, drilling oil wells is a high-risk investment, to say the least. So it's not a very good return on your $300,000.

Now, the $300,000 property may be going up in value, or the mental rights may be going up in value over time. That's possible. That would add to the rate of return. But if you had a $300,000 house that was leased for $500 a month, we would not call that a good deal, which is about what you've got. That's about how this works out.

And so what would I do in that situation? I would sell the mineral rights for $300,000, get out of debt, and pay cash for my first house. Ding, ding. And that sets you up for a lot more wealth building than where you are today. Now, why do I know I would do that? Well, let's pretend. Let's pretend you had $300,000 cash sitting in the middle of your kitchen table,

and you're looking at all those Uncle Benjamins sitting there staring at you. You have two choices. You can pay off your debt and pay cash for a house, or you can buy mineral rights in Oklahoma. Uh, duh. When you put it that way, Dave, well, that's how you got to look at it. That's called a sunk cost analysis. And if you hadn't done this, or if this hadn't been done, would you do it again?

And if the answer is no, then it's time to change. You can do that with a lot of things in your life. Let's say you work for a company and you don't like it. It's easy. You made a mistake. If you wouldn't go to work there again, then don't stay. I was reading Jim Collins' book book good to great one time and um it caused me to let a guy go because it asked the question if you have people working for you and you wouldn't hire them again then why are they still there if you wouldn't

hire them again why are you keeping them and went, I would never hire that guy again. I was just being nice. And I wasn't really being nice because when I let him go, he went on to do a lot better other places because he sucked at the job he was doing here. He was actually better at the job he did when he left here. And it was good for him. It was good for us. So I wasn't doing anybody any favors.

I wasn't being nice. But the sunk cost analysis works in a lot of areas of our life. You can't really do that with kids. If I didn't have this kid, would I have another one just like him? No. Then you can't get rid of him. You're stuck with him once you have him. There's a few things you can't do this with.

But you can do it with your job. You can do it with your employees, your team members that work for you you you can do it with the boat that's sitting in your backyard and you can do it with three hundred thousand dollars worth of mineral rights sitting in oklahoma if i didn't own this today and i had a pile of cash equal to that sitting in the middle of my table would i buy it again and if the answer is no then it's time to sell it. If you wouldn't buy it again, then it's time to sell it. Because otherwise, you're just living your life in default mode, and you don't want to do that. So that's how I know, Shane, that if I woke up in your shoes,

in your situation, I would sell this. By the way, if I owned $300,000 worth of mineral rights that were paying me 2%, I would sell it because I can make more than that on $300,000 and I would invest it somewhere else. And I'm not against mineral rights. I'm not against making money on oil. I've never personally done it, but I'm not against the idea. But if I'm going to do it, I'd like to make some money on it.

I mean, you ought to make 10% on your money. That's $30,000 a year, not $6,000 a year. That's a pretty substantial difference. Josh is with us in Minneapolis. Hey, Josh, welcome to the Dave Ramsey Show. Hi, Dave. Okay, I'm on Baby Step 1. I just started last month.

I made my budget and all that good stuff. The thing is, I have an extra $500 in my checking account where I put basically my paycheck and stuff I pay with my debit. And the $500 is an extra cushion. I was wondering if I should take some of that $500 out of my checking account and put it into the account where my emergency fund is going. Maybe step one, the $1,000? Yes. Okay. Do you have your $1,000 yet?

No, I'm about halfway there. Okay. Yes. I would keep a little pad in my checking. When Sharon and I were working our baby steps like you're starting to do, we kept about $100 in there. We kept exactly $100 in there, and we just pretended like that wasn't there when we were doing all of our calculations and that way we didn't that's what i'm doing yeah then we accidentally didn't end up in overdraft but um but yeah i would pull that and 400 of it if there's 500 there and move that

towards your baby step one emergency fund absolutely i would do that. Sarah is in Springfield, Missouri. Hey, Sarah, welcome to the Dave Ramsey Show. Hi, Dave. Hey, what's up? I just had a quick question for you. I started my gazelle journey back in September. I have just finished paying off all of my credit card debt, and all I have left is student loans and a mortgage.

Woo-hoo! Yeah. So since I started paying off my debt, I had decreased my 401k contributions to 0%. I'm 29 years old. Good. And I was wondering if I should start contributing a little bit to my 401k while I'm paying off my student loan. No. No. No.

What we teach is you stop all investing. Right. Temporarily. Temporarily. And you completely focus on getting out of debt. This is why people are able to get out of debt is because of that. How much student loan debt do you have? It's about $70,000.

Ouch. And what's your household income? I'm single, and my income is about $50,000. Okay. How much debt have you paid off so far? Right about $9,000. Okay. And how long did that take you? Four months. Okay. And so if we multiply that by three, that's about $30,000 a year,

which says you've got about two years and some change at that rate of pay to get rid of $70,000. Okay. In two and a half years, something like that. You might do it faster, but somewhere around that range is how long you're going to be out of your 401K. So here's the scenario. At 31 years old, you're going to be able to put 15% of your income for the rest of your life in your 401K because you have no payments but a house payment. Believe me me that will

make you wealthy okay you'll be fine but go ahead and play through don't stop oh no absolutely not it's game on complete focus on this debt and because what you focus on is what happens right and so let's continue to do that but it's a temporary thing. Now, I'm not telling you to not do this for 10 years. We're talking about two years. Right. Okay. That's just what I wanted to ask you to make sure that I was on the right track. You are on the right track, and that is what we teach, to stop all investing temporarily

while you do this, while you get out of debt. Accept your home. Good question. Thanks for joining us. Open phones at 888-825-5225. Jamie is on Twitter, at Dave Ramsey. Dave, have you ever considered starting a matchmaking service to help people out who follow your principles?

Yeah, I considered it for about a second and a half and decided not to. It's not the business that we're in. We did try to get the guys over at eHarmony to do a Dave Ramsey section and they didn't see the benefit in it. I think it would work. You know, all these young ladies that are

looking for young men that are, or old ladies that are looking for old men that are financially responsible or vice versa. I mean, you want to hire, you want to

date a girl who's a princess or you want to date one that's like a grown girl, grown woman. Yeah. It's a good, I think it to date one that's like a grown girl, grown woman? Yeah. I think it's a good idea, but we're not going to do it. This is the Dave Ramsey Show. Thank you for being with us, America.

We're glad you're here. Open phones at 888-825-5225. Happy New Year! Keep doing the same thing you've been doing. You're going to keep getting what you've been getting. What are you going to change? What are you going to change? You want different results, you have to do different things.

What are you going to change? Lauren is with us in Orlando. Hey, Lauren, welcome to the Dave Ramsey Show. Hi, Dave. It's an honor to speak with you. Thank you for everything that you do. Well, thank you. Happy New Year.

How can I help? Happy New Year. Yes. So over the last year, I've been able to pay $34,000 in debt, and I want to continue trying to do the best to stay on the plan, thanks to your teachings. And one of the questions I have is I'm working the debt snowball, and I have three debts remaining.

I have a student loan of $8,000, an IRS bill, federal taxes of approximately $17,000, and another student loan of $28,000. How do you end up owing the IRS $17,000? My husband is self-employed, and he was not setting money aside. He's struggled with managing money, and we're trying to turn that around and he was not sending any money aside to pay quarterlies or pay anything towards his federal income taxes. Is he now? He is now because I'm starting to intervene and we're starting to take a percentage of what he deposits and I just take that automatically, and I put it into another account so he doesn't see it, and then I just send it to the government as quickly

as I can. So we're hoping not to fall behind on that anymore. That's been a big sore spot and a big source of contention, because I really, really wanted us to be out of debt, but I'm kind of scared of those people. You should be. And, you know, I don't want to owe them money, and so I was going back and forth, but I'm kind of scared of those people. You should be. And, you know, I don't want to owe them money. And so I was going back and forth, and I want to do things right. And I'm thinking, should I work the snowball out of order in this instance?

Yes. Okay. Okay. The IRS and child support are the only thing that go to the top. Okay. Okay, good. They go to the top regardless of the amount. And the reason is several fold.

One is the penalties and the interest charged is so freaking outrageous. But that's not the main reason. The main reason is they have almost unlimited power to mess up your life. Yeah, yes. It happened to us years ago. Yeah, and they just go, surprise, we just took some of your stuff. And they are just, you do not want to deal with these people. If you happen to get one of the IRS employees that is a good person, you found a rarity. And even then, they have unlimited power and are used to using it.

And so that's if you get behind with them and so forth. Have you got this on an installment plan? I do have it on an installment plan, and currently I'm paying $500 a month towards that. Good. That'll hold them at bay. But go ahead and move that to the top. And let me just tell you, you guys will not prosper until you properly handle your taxes. You're right, sir.

No matter what you do, none of our other techniques and the things we teach you the debt snowball the budget none of that will work until your husband decides that he's going to properly with your help handle his taxes i gotta tell you i self-employed people we're the worst on this i was the same way i mean the one thing that came out of stinking bankruptcy was not the one thing there's one of the things that came out of the bankruptcy. Survived it. In our case, it was a huge IRS debt because I was playing games with them, trying to do other deals and stuff. And it's just horrible. So I'm just like your husband. Only it was 30 years ago for me

and I learned my lesson. If you guys, it adds, it will add so much peace to his life and the way he thinks about his business if he has his taxes under control and properly planned and properly paid and the quarterlies are happening. He may need some administrative help from you and or a bookkeeping service or get with one of our tax ELPs to help you or something like that. But he may not want to fool with it personally. I can tell you I don't want to fool with it personally.

But I have an incredible tax team around me today. Ours is very complicated. But we stay so ahead of it. As a matter of fact, I spent the last two weeks screwing with it because it's the end of the year. And we had a tax plan out the whole year. We've got to move all the money around and do all this stuff because they're going to hammer us. They always do and you know we just we spent a lot of time and energy complying with the tax code but it is worth it because boy you will spend some time and energy if you don't as

you know it just hovers over your head so to answer your question yes move it to the top of the debt snowball and your instinct was right to intervene, but we've got to get his head wrapped around how important this is. It will set his brain free to go make money in his business when he doesn't have the IRS clawing at the closet door, the monster in the closet, trying to break out at any moment and stomp all over his business. And they will. They will. It's just not worth it to screw with those people so they love

me and they hate me because i call them names but like the kgb but they love me because i always put them to the top of the list and always tell people to pay them every dime you owe it's a matter of your integrity not a matter of endorsing the level of taxation that we have i I hate our taxes. Our taxes are completely out of control, but I pay every single penny I owe exactly because that is a statement of my integrity, not a statement of how efficiently our government runs or how much I love taxation. It doesn't have anything to do with that. So that's what you've got to do, and when you get that straight in your brain and in your emotions, your husband does, it's going to set him free to go make more money in his business. So you're on the right track with both of these things.

Go with your instincts on both of them. You got this, kiddo. You can do it. Brian is with us in Charleston, South Carolina. Happy New Year, Brian. Hey, man. How's it going? Better than I deserve, sir.

How can I help? Cool. Hey, I have a career question for you, and I'm just looking for some guidance. So I was going to get help now. I am a high school teacher. I'm 26 years old, and I'm single, and I'm debating a career switch. I don't really kind of know how or where to go, but I'm getting through my days, and I'm just really not enjoying them.

I'm in the middle of your plan right now. I'm in baby step two, and I'm aggressively doing that. I'm working some extra jobs, keeping me occupied, keeping me busy, but I'm not really feeling challenged in my day-to-day job, and I'm just really seeking some guidance, and so I was hoping maybe you could give me a shot. How much debt have you got left, not counting your house? I have $30,000 of student debt.

I own a student debt. And the kind of kicker to all of this is if you teach for five years in the subject I'm in, the government will forgive $1,500 of it. How much of it? $17,500. Okay. I'm in my second year teaching. You're in your second500. Okay. I'm in my second year. You're in your second year. Okay.

Well, I mean, you can stick it out for three years for $17,000, but you might do something else and make more money enough to offset the $17,000 loss, right? Right. I don't know if I would do this at all. So, well, the thing is this. There's nothing wrong with

changing jobs at any point in the baby steps. You would want to make more money. Right. And so you just call me up with this general unsettling displeasure with where you are, but that hasn't yet led you to where you're going, right? Correct. So let's start exploring some options. They're all hypotheticals at this point.

And just start going, okay, well, what could I do? I can do anything I want to do. What do I do? What do I like about what I do? What do I hate about what I do? You might like teaching and hate teenagers. You may like teenagers and hate teaching. I don't know.

You may hate the administration that you're working with, and so i don't know um you may hate the administration that you're working with and so you don't want to work with bureaucrats or whatever you're facing that's what is it that's sapping the joy out of what you thought was going to be your career and because you went to a lot of trouble to get a teaching certificate um yeah and so there was something that drew you to that originally and maybe you need need to teach, but maybe in a different way or a different place, and then what are the steps to get there? Have you got to get a different certification, or do you need to get a master's in a certain area,

and you start working on that for a couple years, and you can stay there two years while you work, you know, figuring out while you get the steps under your belt to figure out where you want to go. But the next step for you is figure out where you want to go. That's your next step. Where is it you want to go, and then what are the steps to get there? And start to break it down into bite-sized doable things. Where is it that I want to be when I'm 36?

What does the job look like? What does it sound like? What's the career field sound like? I teach for a living. I'm a pretty well-paid teacher. So, you know, you can teach a lot of different ways in a lot of different settings. That's something to think about. This is the Dave Ramsey Show. Hey, it's Blake, Chief Production Officer for the show, And here's a little tip for 2018. Go download our revamped Dave Ramsey Show app from the App Store.

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