The Ramsey Show - App - DAVE RANT: Quit Being "Dave-ish" (Hour 2)

Episode Date: December 31, 2019

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, 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. Thanks for joining us. It's a free call if you want to talk.

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We're glad you're here. JJ is in Portland, Oregon. Just common sense. But thanks for hanging out with us. We're glad you're here. JJ is in Portland, Oregon. Hi, JJ. How are you? I'm good, Dave. Thanks for taking my call. Sure. How can I help?

Well, I work for a public utility, Eugene Water and Electric, where I live actually close to Eugene. And I've been working here for about three years. And they have an option, a 457 option. And I'm just not sure I've read in your books that that would be the last thing that you would do. And so I was just curious, I'm not sure if I should go with that 457 option. That's the only option that they give us. And so they also have a brokerage alleyway that I can go down. There's a fee associated with that, but there's

no fee at all. A loaded fee is what I've been hearing it's called for the 457 that they do offer. So I just wanted to get your feedback on what the 457 entails and should I go that route or not? Okay. 457 is deferred comp, deferred compensation. That means you put off, defer your compensation. All it is is you just didn't receive your pay. So you don't charge your taxes because you didn't receive the pay. And the pay that you haven't received goes into an investment. And the brokerage alleyway, tell me a little bit more about that. Well, it's a brokerage.

You pay the fee, and then I guess it opens it up to the entire market. So you're not just limited to the mutual funds that they have chosen. Oh, and you can run the 457 into that? Yes. Oh, okay. I can take that option, and then I can pay a parent. From what I'm hearing, it's a fee, but it's a small fee, I guess. And, you know, it's funny because all the people that I've been talking about that I work with,

they're just so, the 457, 457, 457, they just push it, push it, push it, and they think it's, you know, the greatest thing in the world. Yet here I'm hearing from, you know, your books that it's something that you would be able to do. It's not bad. It's not a thing you don't do. But if you have other options available, they're going to play out better for you than a deferred comp plan. So it's not the other world. It's better than not doing anything, and it's better than not sheltering the money in any way.

And so we do want to do this. Now, are you married? Yes. And does your wife work outside the home? No. She stays with our two kids at home. Okay, and what's your household income? About $60,000 gross.

Okay, all right, $60,000. All right, so you only need to put in $9,000 a year in Baby Step 4. 15% of your income is $9, does that sound right right right so you could do two roth iras and not have to fool with this at all okay two roth iras two roth iras would be eleven thousand right right yeah that was my my next question kind of was should i just do the roth iras instead and just completely forget about the 457 well for right now i would i wouldn't forget about it forever but for today if i can choose a roth anything over deferred comp it's mathematically going to turn out better so let's just say you did that for a number of decades and you ended up with $2 million in your investments, okay?

And you either put $9,000 in the 457 or you put $9,000 into the Roth IRAs, okay? Just say, okay, if there's $2 million in there in a 457, when you take it out, it's taxable. If there's $2 million in your Roth IRA, there's zero taxes. Now, taxes on $2 million would be somewhere around $500,000 or $600,000. So if you put $9,000 into Roth IRAs, you're going to come out $500,000 or $600,000 better off than a 457. Okay. See what I'm doing? Yeah, right.

Okay. That's why I'm saying that. Now, the 457, again, is better than doing nothing. But you've got a better option. And I would just get in touch with a SmartVestor Pro. Click SmartVestor at DaveRamsey.com and sit down and open you a couple of Roth IRAs. You don't even have to go up over 9,000. You can do, you know, two 4,500 ones.

But you've got the option to go up to 11,000. Maybe step forward. It's not the end of the world either way. You're going to be fine. You're young. You've got a lot of time to invest and save and you've still got to finish up and that's when you get to baby step four now when you get to baby step seven and your house is paid off and you have no debt of any kind and your kid's college is underway and you want to do more investing after

you have completely maxed out, if you do the full $11,000 into the two Roth IRAs, then go over to the 457, and I probably would pay the brokerage fee because I don't think it's going to be a very large fee, and I think access to someone to help you pick some stuff in that 457 and to guide you and teach you in that is going to be worth the small fee. And the access to a whole lot better and wider array of funds is probably worth the small fee. Here's the thing. Everybody gets pissed off and twisted up about paying a fee on stuff.

But the fees on investments are not very large compared to fees we do on other things. And there's no data that says people don't get rich because of fees. The data says people don't get rich because they don't invest. Right. That's what the data says. And the rate of return is a much bigger deal than the fee. I mean, if you don't pay a fee and you get 6% and you do pay a fee and you get 12%, well, you're going to kick their butts after fee, you know?

Right. And so everybody gets all twisted up and trying to save a little bit of money on a fee, and they're, oh, God, I'm going to DIY this. I'm going to do it yourself. Well, I don't operate on myself. I don't pull my own teeth, and I don't work on my own cars. And I got a sharp knife in the basement. I probably could do about all of it, but I'm not going to.

I'm going to get a professional involved, so it's worth a little bit of a fee there. But for right now, while you're on Baby Step 4, if that's where you are and you're ready to do your 15% of your income in there, then I would just start with a SmartVestor Pro, pick you out a couple of mutual funds. You can pick out the four types we talk about, spread it across those four evenly. Growth, growth and income, aggressive growth, and international. And you're going to do just fine.

You're going to do just fine. But again, the 457 is just my last choice. It's not a never-do-it choice. I would do the Roth, and I just showed you why. You're going to end up with more money is why. Taxes are a bigger deal than fees by far. It's a lot bigger deal. Hey, thank you for calling in.

We appreciate you being a listener. Open phones this hour as we talk about your life and your money at 888-825-5225. Dave, would you recommend putting money for Baby Step 3 into some investments to ramp it up a bit? Stephanie on Twitter says, absolutely not. Baby Step 3 is your emergency fund. It's your rainy day fund. It's not an investment. It's insurance. And you want it there parked, boring, not making any money, but completely available for when you have an emergency. You notice I didn't say if you had an emergency. I said when you have an emergency. It's going to rain, darling. You need an umbrella. This is the Dave Ramsey Show. Are high health care costs getting you down?

Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Thank you. Health Cost Sharing Ministry, a Better Business Bureau accredited organization CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years, and our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thanks for joining us. Gina is with us in Mobile, Alabama. Hi, Gina. Welcome to The Dave Ramsey Show.

Hi, Dave. Thank you for taking my call. Sure. What's up? Dave, my son currently receives around $1,000 as a survivor's benefit for Social Security from when his dad passed away. I used that money to pay for his private school education. He is now in public school. So for the next two and a half years, I can put that money, that $1,000 away in a savings account for his college, or currently I've remarried.

My husband and I are going through FPU, and I wanted to know if we should use that $1,000 towards our debt snowball. What is your household income? $160,000. Okay. Morally, the way I look at it is this. Legally, you can do with that money whatever you want. Okay? Morally, the way I look at it is the money is furnished to the child

to make sure that the child is cared for. Yes, sir. You are spending well in excess of $ thousand dollars a year on food shelter clothing electricity caring for this child agreed correct okay so the child is cared for yes he is okay so it's you know so so really morally you just put it at the top of the line it's one of the household incomes that you have that you budget your household income. And so when you put your income at the top of the page, you put his income at the top of the page, and then you take care of him, you have spent more on him,

including when you get to baby step five and you save for his college, you will have spent a lot more on him than $1,000 a month provides. And so he in no way comes up short okay does that make sense you're not you're not cheating him by not keeping it separate i would not keep it separate i would make it part of your household budget work your baby steps and when you get to baby step five which you will very rapidly with your income and you're saving very aggressively for his college how old is he he is 16 so he has two and a half more years where he will receive this survivor's benefit right and in the first year of college anything that you would have gotten in the next two and a half years you're going to spend anyway okay helping okay yes and like

that more it was more like you said a moral issue like, okay, is that really mine to put into the budget? Yes, because you are already spending more than you're receiving. Thank you, Dave. Let me tell you, you are changing our lives. Thank you so much. I'm not. You are. I'm proud of you.

Get after it. Love it. Thanks for calling in. You're the hero. Open phones at 888-825-5225. Myesha is with us in New York. Hi, Myesha. How are you? I'm good, Dave. How are you? Better than I deserve. What's up?

I just wanted to ask you a question. I'm a divorced mom, four kids. My income is maybe, if I add my second job in about 32 a year, my debt is roughly about $66,000 and some change. If you could tell me how long you think it might take me to pay this off? Well, you live in a very, very, very high cost of living area, don't you? Yes, but I also live in public housing, so I'm definitely one of your lower-end income people. Yeah. Okay. So my rent is based on my income. Okay, so how much is your rent? $705,000. Okay, on a $32,000 income with four kids kids uh yes a daughter in college and three sons a senior in high school a sophomore in high school and a seventh grader and child support is sporadic she's trying to be nice okay uh Okay. That's a difficult road, kiddo.

I mean, your income in that New York City environment, your income with four kids, I don't know how you're making it even with a $750 house payment. When they're gone and child support is gone, for sure, unless you're trying to collect back child support at that point, which you probably would be owed, if you just call me and say, I'm single, I make $32,000, and I have $60,000 in debt, and I live in New York City, I would be going, I don't know how you're going to do that.

Yeah. So what I would tell you is this. In order for you to call me back 10 or 20 years from now and be very, very wealthy and prosperous and having a wonderful money life, something's going to have to change dramatically. The numbers you're giving me aren't going to lead you there. Okay. So one of the, one of two things will change.

Either you're going to do something with your career that triples your income, because it takes six figures to exist in New York City, or you're moving to another area of the country that has different opportunities and a different cost of living. Now, that might be when the kids are gone three years from now. You might suffer through and break even for three years. But I don't think you're going to be paying off a ton of debt with four kids, $750 rent, and $32,000 income in New York City.

I mean, if you pay the payments on your debt, I think you're doing well. And paying the payments is a 20-year plan yeah so i'm not trying to give you no hope i'm just saying you have a small shovel a big hole yeah and it's like you know i got a teaspoon and i'm out in the yard trying to dig a ditch and um so uh i i want to challenge you to say, if we're going to stay put in this area, what are we going to do with our career to get my income up on a temporary basis and on a long-term basis by even changing careers? And what do you do for a living? Well, I'm an office manager, and I just got that job.

And I'm probably going to need to go back to school to finish my degree which will mean having to probably take out a loan maybe it depends on what degree you're finishing and where you're working maybe you work someplace that pays for your degree to be finished yeah that's that's true i could i i do plan on possibly looking at and maybe you don't need a degree. I don't know what you're going to do. Don't just assume more education is always the answer. I want you to lay out, how old are you?

44. Okay. So what do I want to be when I'm 54 that pays $75,000 a year? Okay. And I've got 10 years. So what are my steps to get there? Now, that will get you out of that not not in two years not probably not in three years but it'll probably get you out of that in five years but sitting where you're sitting is probably a 10-year plan yeah and that's that's

really that's really disheartening so i'm glad you got a new job i'm glad you got a new job. I'm glad you got some support on the housing right now. And that keeps the wolf away from the door. That's good. But now we've kind of got the survival taken care of. Now past survival, how do we prosper? Just real quick, I want to thank you. Because of reading your books, I actually started reading the Bible again. Wow.

I would go back and reference the passages that you wrote in Total Money Makeover, and even though I knew I wasn't in the income bracket, it took me back to the Bible. So I've started reading that again. So thank you. Well, thank you. I want you to understand I'm not saying someone can't make it at $32,000 income. You can make it at $32,000 income. But you live in one of the two most expensive places

in America. I do. To do that. And so that's very, very, very, very difficult. Add to that four kids. Add to that sporadic, in quotes, child support. You need a break. And you're thinking about it so you're not stuck. You're not stuck. You just need a break, and you're thinking about it, so you're not stuck. You're not stuck. You just need a path. You need a flashlight and a path on how to get out of this cave.

I'm following the baby steps. I'll continue to do it until. Do that, but work on the income side of the equation or relocate within 36 months. Okay. One of those two things, and let's get you going in that direction. And hold on. I'm going to send you a copy of another book you need to read called Start. And you're doing a good job.

You've already more than started. But I'm really proud of you. Very well done with all the decisions you're making. And you are in the process of completely changing your life. I see big things for you in the future. But we've got to change the math of your situation. This is The Dave Ramsey Show. I love talking about companies that know how to do business right. You've heard of Grip6 belts, right? Well, if you haven't, it's the only belt you can get online with no holes, no flap, and no bulk.

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Check out this month's special offers from my listeners at Grip6.com. In the lobby of Ramsey Solutions, Harry and Melanie are with us. Hey, guys, how are you? Hey, Dave. How are you? Welcome, welcome. Where do you guys live? Rochester, New York.

Wow. And all the way to Nashville to do a debt-free scream. Woo-hoo. I love it. How much have you paid off? $30,000. Good deal. How long did that take?

350 days. Over 11 and a half months. I love it. I love it. And what was your average household income during that 11 and a half months? We were in the $90,000 range and ended at $100,000. Okay, cool. What do you all do for a living? I just got a promotion, actually. I'm a branch manager at a local community bank. Great.

And I teach first grade. Very cool. I love it. That's perfect. actually i'm a branch manager at a local community bank great and i teach first grade very cool i love it that's perfect so what kind of debt was the thirty thousand dollars student loans student loans sally may that's right i had to give the old woman her eviction notice she's out out of here so how long have you been out of school? Long time. Me, eight years. Yeah, and then I did my master's program about five years ago.

So Sally's been hanging out for a while. A little bit. Too long. Getting a little long in the tooth there. That's right. So what happened a year ago that lit you guys up? Sure. Our story probably starts about three years ago, actually. I was in sports radio,

actually. I wasn't making a lot of money. I wasn't real happy. So I decided to make the career change to banking. And through multiple promotions, our income increased. So 2016, we had this awesome year. We went overseas. We bought a puppy, we did all these things that, yeah. Sounds like a movie. We had money and we just wanted to use it. Yeah. But then at the, towards the end of the year, Melanie had a friend, her best friend that was going through the program with her husband. And it just, we got that feeling that we weren't doing enough with what God was blessing us with. And honestly, it was all part of God's plan for us.

Our church offered Financial Peace University last January. So we started January 1st. Perfect timing. We realized how much the debt was hanging on us. And we realized if we could do all of that in one year, we need to be doing more with our debt. We need to get rid of it so we can do even more. And that's how we started. So you went into the Financial Peace University class.

I mean, when you went to the course at your church, you got in the group. You kind of went in with an open mind. You're like ready to go. You weren't like dragging your heels. No, we were ready. Okay, it's time. We're making enough money. We make too much money for this to be hanging on.

Correct. And so it's like, just show me how Okay, it's time. We're making enough money. We make too much money for this to be hanging on. Correct. And so it's like, just show me how. Just show me how. And one of the profound truths in what you always mention was when we did our budget, there truly was this feeling of we got an additional raise. Even though I had been increasing my pay over that three-year period, that was really the one that popped it. It just felt like, wow, actually I do make a lot of money if I actually budgeted. Yeah, if we actually made the money to behave.

And so you cash flowed all this? Yep. Just got on beans and rice, rice and beans for 11 and a half months. You got it. Scorched earth, no life. Yeah, well, we were lucky that, like we said, we had some friends who were going to the program. So we did a lot of dinners in with them, which was great. And we just really became a community together, which was awesome. Yeah.

So we were all about it. And we kept saying, it's only a year. It's only a year. We can do this. We can get out of this debt. And then it's gone. Do anything for a year. Right.

Yeah. Right. You really can. So you had those folks supporting you. You have other people cheering you on? Oh, yeah. Yeah, I mean, people were, you know, they were either really excited or they were kind of confused as to what we were doing.

Whether you lost your mind. Yeah, because, you know, they had just seen us have this awesome year, and they were like, oh, yeah, they're ready to have fun with us. And then we completely stopped, you know, all the having fun stuff. All the stuff that costs money to have fun. All right. So yeah, you just, yeah, you had a personality change right there. Boom, just like that. Very well done. What do you tell people the key to getting out of debt is? You did it. $30,000 in a year. It's the budget. Absolutely. That was the most difficult part was the budget

meetings. I'm the nerd. Obviously the banker's the nerd. So Melanie's the free spirit. Very much so. You kind of served me, Dave, because we were going through financial peace and in one of the lessons you talk about how, you know, hey, nerds, don't take too long during the budget meeting. They're going to just, you're going to lose them.

And sure enough, that first one, she was just out. It was like 20 minutes in and she's like, I haven't even said anything. And this is so nerdy. I can't even take it. So we really had to, you know, mature that, that conversation and I had to allow her in. And that's what really helped was obviously we'd been married for so long. We have the same goals. We just had to put them on paper and talk about them and become unified in our, you know, financial goals. Yeah. So, so Melanie, how did you get him to shut up? Um, I would start to bring things to the table. So once we just got the first couple of meetings were tough cause we didn't really know how to do it. And then, then it got into, I started to

recognize like my month as a view and what was I doing in that month and what was important to me in that month and what did I want to spend money on for us and, you know, for me. And so just coming to the table ready to just have those conversations and agreements or disagreements over certain things. What was the biggest budget fight of the whole 12 months? Ooh, I can't even remember exactly. There were so many. No, no.

I'm kidding. I'm kidding. It's an underhand pitch. I think we were really cautious at the start. We had this goal of it'll take us 18 months because, again, I had extrapolated out exactly how we could do it over 18 months. And then I started seeing how much could do it over 18 months. And then we, I started seeing how much we were paying off each month. So then without mentioning anything to

Melanie, I decided that, oh, we're going to do this in 11 months. And, uh, that didn't go over super well. So I had to, you know, have bring her in and we had to talk about, well, this is why we should get even crazier about this because it'll be so much more rewarding to, like, even have Christmas knowing that we have no debt. This is a great way to celebrate Christmas. And we were going to visit my sister in Charleston, and it became, like, our mini little celebration,

our visit to my sister. So we kind of had that goal in the forefront. Love it. Love it. Very well done. I think the biggest thing is, is that not only is it a financial program, it really strengthened our marriage. It strengthened the way we communicated with each other, um, about everything and what was important on my heart and, and what was important with Harry.

And we just were able to bring that every month and daily. What are we, what are we spending our money on? What are we spending our time on? And our church was going through a REACH campaign and a REACH initiative, and that was put on our hearts. So a lot of things that just strengthened us all around. So it was more than just about fighting over money. It was more about strengthening who we were as a couple. Yeah.

That's very cool. Well done, you guys. I'm proud of you. Thank you. Proud of you. Very well done. Well, we've got a copy of Chris Hogan's retire-. Well done, you guys. I'm proud of you. Proud of you. Very well done. Well, we've got a copy of Chris Hogan's retire inspired book for you. We want that to be the next chapter in your story that you become millionaires and outrageously

generous along the way. Absolutely. Thank you so much. Thank you. You're definitely on the way. Harry and Melanie, Rochester, New York, $30,000 paid off in 11 and a half months, making 90 to 100. Count it down. Let's hear a debt-free scream.

Three, two, one. We're debt-free! Woo! Love it! Way to go, you guys. Well, I don't know what you make and i don't know how much debt you've got but today if you haven't done it is the day that you need to sit down and look at that

and i call it the shovel-to-hole ratio. They were in a $30,000 hole. They had a $90,000 shovel. How quick can you do that? They did it in one year. See the ratio? What if you had a $200,000 income in a $30,000 hole? Well, you should do it in six months, right, or quicker even.

What if you had a $40,000 income and a $30,000 debt? It's going to take a little while longer, isn't it? See how that works? It's the big numbers you're looking at. And then that forces you to say, we're going to have to pay a price to win. Because you are. You're going to pay a price to win. I don't know how big the price you're going to pay is, because I don't know how big a mess you've made.

And it is a price to win. I don't know how big the price you're going to pay is because I don't know how big a mess you've made. And it is a mess you made. When I made the mess at my house, I made the mess. And boy, did I have a lot of it. You can shovel it. There isn't much mess. Understand. Understand how we got here.

The question is, though, where are we going? It's your turn, you know. It's your turn. Ready, set, go. it's your turn you know it's your turn ready set go Jackie is in Atlanta. Welcome to the Dave Ramsey Show, Jackie. Hi, Dave. Thank you so much for taking my call.

Sure. What's up? I don't believe I've ever heard you mention this before. My husband and I only have left our student loans, about $30,000 each, so a total of $60,000. Our household income is approximately $78,000. He will be eligible for Social Security in August. So my question to you is, should we take the early Social Security, which would add about $1,800 extra to our monthly income, or wait until he's 66 when it'll go up to about $2,300? Well, obviously, the sooner you take it, if you use it to grow wealth it's going to come out ahead for you uh but if you use

it just to consume it it obviously uh and you end up with less money by taking it sooner uh unless you die soon the sooner you the sooner you die the smarter it looks mathematically to take it uh but if you invest it or use it to reduce debt so that you can invest then then taking it as early as possible does make sense because you're getting a better rate of return on it than the than it's going to grow so it mathematically works out to go ahead and take it as long as you're going to use it to further your net worth by reducing debt and or investing. So, yeah, I'll take it as soon as I can take it in that regard, and I'll turn around and invest it because I obviously don't need it.

Misty is with us in California. Hi, Misty. Welcome to the Dave Ramsey Show. Hi, Dave. Great job. I love following your program. I just started probably about six months ago. Cool.

And unfortunately, a divorce was dealing with financial irresponsibility, and I know that I have to take my part in it. However, husband chose not to make a house payment for three months, lost a million-dollar house, didn't bother mentioning the word to me about it. Wow. Anyway, fast forward. A police, Prius, came with me out of the divorce, and he insisted that he wanted his name off the title, which makes sense. So yesterday, I had a tax return refund, because it was pre-dave set up that way. And I had $2,000 set aside to, I have a full emergency fund. Well, the $1,000 to get me started.

And I've been paying off my debt, snowballing it, and making great progress. I have two credit cards left. And they only needed $1,000 for the down payment to keep the monthly payment about the same. Because it is a Prius, I was budgeting prior to the Prius about $350 in gas money per month, and my payment on the Prius to lease it at the time was $350. So you're flipping a lease over to a loan, putting $1,000 down and ending up with the same payment. What's the balance? Yes. It came out to $22,000, and I have it figured out that once it makes it to the snowball, I have two debts in front of it, $6,000 each.

And right now I'm putting six, and it will go to $850 because I'll use that extra $1,000 to pay off the current snowball. What's your income? It's about $75,000 pre-tax. Okay. Yeah, you'll be debt-free within two years, and the car is less than half your annual income. So you're planning to keep it and pay it off, right?

Yes. Okay, good. One of the reasons I chose to keep it is because it's super reliable and it's super fuel efficient. I live in a really dangerous county. I hate to bring this on the show but it's pot capital usa yeah super reliable and super fuel efficient doesn't matter if you can't afford it but you can afford it you can afford it so uh let's just do it let's just do it because

i like my car and i can be debt free completely not counting the house in under two years, and my car is less than half my annual income. And so those guidelines make it okay financially to keep this car. Thank you. I was catching a lot of flack from Dave Ramsey followers earlier today. They don't know the guidelines then. I mean, how are they Dave Ramsey followers? Because I've said that exact thing like 50 000 times so how the crap do they know how they crap the dave ramsey followers and they don't know that guideline i i don't know youtube youtube or where were you hanging out um it's dave ramsey um planner girls oh it's on facebook well and you can just tell them the guideline is real simple if you can pay

the car off in less than two years and be 100% debt-free, not counting your house, in less than two years, and you like the car and the car, all of your vehicles totaled together is less than half your annual income, and you want to keep it and plow through it, that is the guidelines I've used ever since I've been on the air. 25 years. I mean, 50,000 times I've said that, at least. So it sounds like somebody just wants you to be more hardcore on getting out of debt, but you're going to get there. You have $36,000 in debt, and you make $75,000 a year.

You're going to be debt-free in like a year, 14 months at the rate you're going. And so you're doing just fine. You're doing fine. There's nothing wrong with what you're doing here. Nothing wrong whatsoever. If you had called me up, well, you did call me up and ask me whether you sell the car. No, you shouldn't sell the car. There you go.

Open phones at 888-825-5225. It is so funny, this stuff we teach. We give these thumb, rules of thumb, these processes, these ways of measuring things. Don't buy a house where your payment's more than a fourth of your take-home pay on a 15-year fixed-rate mortgage. Put down as much as you can put down, and it's better if you put down 20% because you avoid PMI. These are rules of thumb I've said like a bazillion freaking times. Car and don't own vehicles more than half your annual income, even if they're all paid for, because vehicles go down in value. Anything with a stinking motor in it goes down in value.

And if you have all your net worth tied up in freaking toys, you're a little boy, a little girl, and you're always going to be a broke little boy and little girl. That's what's going on. And I like cars, too. I drove a really nice one down here today, you know. So I'm not against you having a nice car. I'm against your nice car having you. And so I use cars too. I drove a really nice one down here today, you know. So I'm not against you having a nice car. I'm against your nice car having you. And so I use these guidelines.

And invariably, this stuff, when people get plugged into this, you know, what we teach, they're like, I'm going to do everything you say, but maybe not that one thing. I'm like doing Dave-ish stuff. I'm going to do your plan-ish. Well, why don't you just do your plan and admit that that's what it is and don't blame me for your stupidity, okay? Or you get super hardcore financial Pharisee

and make it even harder than what we lay out and take a lady like that and just rip her to shreds in some private facebook group or something you know and that's not my plan either that's not dave ish won't you just call it your plan you don't agree with that plan it's okay if you want to have your plan that's fine mine is the one that five million people have used to get out of debt but you can have your plan but don't blame my plan on your financial Pharisee self or on your ish. Because your ish is when people half-butt do stuff,

and when you half-butt do stuff, you get a half-butt result. You really do. It's not any different than that. You've got to decide what is the truth. And the problem is our culture has stopped believing that there is a truth. And let me just help you with this. 100% of you, liberals or conservatives that jump off a building, you will find the sidewalk 100% of the time.

You can't fly. There's a thing called the law of gravity, and that is the truth. If you think truth is relative, try that exercise. The Darwin Awards will be awarded to you. Seriously, try that. There is a truth. One plus one equals two. 100% of the time.

It's not relative. You don't get to make up your own plan. You don't get to decide that suddenly payday lending is smart for the poor. It's not. It's screwing the poor. It's oppressing the poor. If you own a payday lending operation, you are scum. If you walk in there, you are dumb.

If you defend them, you are scum. They oppress walk in there, you are dumb. If you defend them, you are scum. They oppress and beat up on poor people. Poor people need to have access to capital. They don't need to get screwed. It keeps them poor. That's the truth. It's not really relative. There's not another side to that equation except the wrong side. You can just look at this stuff. Car leasing 100% of the time is stupid. Mathematically, it's a calculator thing, people. There's a truth that's independent of your little relative-ish butt.

So quit being ish. Decide to be somebody. Either hate everything I stand for and go off and prove me wrong, or do the stuff we're talking about. This is the Dave Ramsey Show. This is James Childs, producer of the Dave Ramsey Show. Once again, you made the Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe today.