The Ramsey Show - App - DAVE RANT: What Would Happen if Nobody Borrowed Money? (Hour 2)

Episode Date: May 25, 2020

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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. I am Dave Ramsey, your host. This is your show. Thank you for being with us. It's your show because we talk to you. We actually take more calls than any other talk radio show in America because you're actually the subject here. So we're glad you're with us. Open phones at 888-825-5225. That's 888-825-5225. Joseph starts this hour in Providence, Rhode Island. Hi, Joseph.

How are you? Good, sir. How are you? Better than I deserve. What's up? I just wanted to call you today to get some advice from you. I'm having some issues with my girlfriend. I'm trying to get her to do the debt snowball with me, and she's got like five credit cards and some student loans.

Her cars are paid off. She's got her own house. She's got about $150,000 left on her mortgage, and I'm just really trying to talk with her and get her on the bandwagon with that. And she's got some problems with anxiety and depression and stuff. And talking about that, according to her, supposedly triggers that. And it's just been very difficult. Is she in counseling for her anxiety and her depression?

She was at a time, and she stopped for a few months. Okay. If you have anxiety and depression to the part that to the point that you cannot live your life well you need help with that and you don't get you don't get to stop you get help until you get healed and you need some healing um and because when you say you can't talk about money what you're saying is i can't talk about life because money flows to every part of your life. Right. And so it might be that that's a load of crap.

It might be that she just doesn't want to talk about money because she doesn't want anybody telling her what to do. That might be what it is. I kind of got that vibe dave um her you know her parents have definitely spoiled her quite a bit of her life yeah you know so the word no is not a word she wants to hear nor is it a word she wants to tell her herself she don't tell herself no and so anything to do with her anxiety or her depression it's got to do with she being a spoiled brat it could be i don't know. I'm just guessing. It could be. It could be both.

But anyway, so here's the deal. There are four things that marriage research tells us you must be in agreement on if you want a high probability of a successful marriage. The number one cause of divorce in North America today and trouble in marriage is money fights number one okay and so you know anytime you find the number one cause of something you deal with that if you're going to be doing that something so if this relationship is going to get serious and move towards marriage this has to be dealt with is what i'm saying you guys have to have some discussions you have to get on the same page you have to have an agreed value system to go forward because if you marry a princess you're going to have what's known as a long freaking life okay right so you don't want to do that and if she marries a jerk that doesn't

want to work much and doesn't want to pay his bills. She's going to have a long life, right? And so you guys need to be in alignment about how you're going to handle money and what our view of money, savings, and debt, and investing, and generosity is. And we need to have some alignment on those things. Now, she doesn't have to be exactly like you, but you need to have had these discussions and be in alignment on those. The other three things, by the way, in the statistical data on marriage are being in agreement on in-laws, kids, and religion. Kids, if we're going to have them, how many and how they're going to be treated.

Are the inmates going to run the asylum? How are we going to deal with boundary issues and extended family which is um crazy in-laws and so forth interfering people all that kind of junk and then you know religion uh and christians call that unequally yoked so anyway if you're in agreement on those four things and you've had some good pre-marriage counseling and good healthy non-toxic discussions where we're aligned on those four things statistically you have a very high probability of your marriage winning so that's how i would talk to her about it i just go listen this is a big deal because it's the ingredients it's one of the big ingredients for success and i want a relationship to be successful

so for your relationship to take the next step and become more serious towards marriage this has to be dealt with and you can gently and kindly and but you need to figure it out ahead of time don't and don't think oh we get married we'll straighten it out then no okay this is something you deal with before the engagement ring goes on the finger. Yeah, so I'm going to put it in the butt as fast as I can. Well, I mean, it's a deal breaker. Right, right. And it's not because money is that big a deal.

It's because your value system, how you spend money, says what's important to you. How you handle money. And if you're going to put your hands over your ears and go la-la-la-la-la-la-la-la and act like we don't have to deal with this and somebody's going to swoop in, the fairy godmother's going to take care of us, the government's going to help us retire, which is well known for its ability to handle money, you're going to be broke your whole life. I mean, I can spend on these credit cards. There's no end in sight.

You're not in Congress. You've got to have a plan. So that's the thing. In other words, if we're going to practice denial because it causes us stress, denial is a river in Egypt. We can't do this. It doesn't work, man. So that's what you guys got to, and so you can have some kind, gentle discussions and probe,

but only to the extent the relationship is moving forward and the relationship is stalled until you get past this hurdle uh at some point now again if you've been on three dates it's not something you talk about that much that would be weird but um unless you met on the in the dave ramsey community or something on facebook but which we've now had three engagements on there but but if you're not if you didn't meet there then it's weird to talk about this on the first two or three dates. It's a lot of stuff you don't. It's a very intimate subject.

It's not something you do in casual conversation in the first go-round or two. So anyway, it's a big deal, though, folks, for you to be aligned. And those of you out there that are married, I mean, you and your spouse being on the same team is just, it's just, all the data points are there. It's almost impossible to drag someone down the road to wealth. You kicking and screaming against their will. It's almost impossible to do that. It's almost impossible to out-earn someone's spending addiction. It's almost impossible to out-earn your stupidity and lack of organization.

I tried it. I couldn't do it. I'm pretty good at making money, but I couldn't make enough money to get past my stupid, because I do stupid big when I do it. And so you cannot do this. You've got to be aligned. You've got to be on the same team. You have to make decisions together that are major decisions and be unified about it.

And, you know, Sharon and I practice that to this day. It is the recipe to a great marriage. It increases communication, quality communication. It increases intimacy. It increases the probability of you building wealth, working together. You are not roommates once you put the finger in the ring and you say, I do. This is The Dave Ramsey Show. For most of us, healthcare costs seem to increase every year, and saving money on health insurance feels more and more out of reach.

For example, take the Olcheski family from LaGrange, Texas. Jeff and Carice had just celebrated the birth of a new baby boy. Shortly after, they had a health scare involving one of their kids that was completely unexpected. With today's health care climate, this could have bankrupted them. But thanks to Christian Health Care Ministries, the Olcheskis were spared from a ton of medical bills. As members of Christian Healthcare Ministries, they're part of a group of believers who financially and spiritually support each other. CHM is the original health cost-sharing ministry and is a Better Business Bureau accredited charity. It's biblical, affordable, and it shared nearly $97,000 to help the Olcheskis.

To be a part of Christian Healthcare Ministries, visit chministries.org. That's chministries.org. CHM is a proud sponsor at Dave Ramsey. What would happen to the economy if everyone suddenly started your plan? Well, the first thing, if they suddenly, the entire population, you could snap your fingers, stopped borrowing money, it would crash our economy. Because our economy has so much banking and borrowing running through its veins. However, that's a hypothetical philosophical question that couldn't actually occur.

What could actually occur and should actually occur is gradually more and more people become wise and decide to stop borrowing money. And so over a period of time, we wouldn't have as many banks, and they wouldn't be nearly as profitable, the ones that stayed open, because there'd be less and less people borrowing money. You and I know that there's never a case where the 100 percent of the people would stop borrowing money that's impossible even prohibition a hundred percent of people didn't quit drinking you know i mean it's just it's impossible to get a hundred percent of people doing anything so but we're talking about more reality than theory here so reality is is that

if we could move more and more people away from debt, what would happen? Well, more and more people would prosper as individuals, as families. Because if you don't have debt, you have more money to give, more money to invest. So charities and ministries, nonprofits, would be better funded by 10 or 100x as people move away from debt. Because giving and generosity increases when people are debt-free. Savings and investing would increase as people are debt-free. Which means wealth would increase among individuals. And so you could slow down some of the disparity between the richest and the poorest. This thing that everybody's worried about, wealth inequality,

and all the lefties are all freaking out about wealth inequality, wealth inequality, wealth inequality. That would start to go away because one of the things that magnifies that exponentially is the haves are building wealth and the have-nots are building debt. And so it's making the poor poorer and the rich richer because the rich aren't in debt and they're becoming wealthier and wealthier. In a lot of cases, that's how they became wealthy. The Millionaire Theme Hour confirms that. And so what would happen? Oh, the other thing that would happen is debt has destabilized the economy, made it more volatile because everyone's living on the edge, living on the bubble.

Every time there's a little wave that comes through, something that scares people just a little bit, it crashes entire segments of the culture. But if a wave comes through and you got a really nice boat, you just kind of smile and ride the wave, meaning that you don't have any debt and you have a big emergency fund and the economy slowed down a little bit, it doesn't cause you to slow down. Oh, and by the way, business would prosper and there would be more jobs. What? Well, let's think about it. If you, just think about your life and your home,

if you are 100% debt-free, mortgage and everything, and you had an emergency fund and you were making good money, do you spend more money? Yes, you do. What do you spend it on? Clothes? Nicer clothes? Vacations?

You can go out to eat. You save more and you give more because you have more, but you also spend more because you have more. I spend more now than I ever have at any time in my life, but I have more than I have at any time in my life. I mean, let's pretend you had $5 million net worth, and you had zero debt, and you had $100,000 a year income. You would be spending more. And so where do you think you're spending that? You're spending at the local restaurant. So if more people did that, more people spent at the local restaurant, what would happen at the local restaurant?

Well, it would prosper. What would happen in the local hardware store? It would prosper. So the overall it would prosper. What would happen at the local hardware store? It would prosper. So the overall economy would prosper, yea, even explode, because spending would increase. But when spending increased

based only on consumer confidence that causes the consumer to falsely be confident and therefore go and borrow money, that further destabilizes the economy, even though it gives a short-term spike to the economy. Because when the consumer gets all cocky and is willing to go put money on credit card debt and willing to go buy a car they can't afford and put it on payments and willing to go buy furniture they can't afford and put it on payments because they feel so good

about everything, that drives the economy up. But it's all borrowed money. And what goes up must come down when it's borrowed. But if it goes up and you're spending money that you actually have, and a whole bunch of people did that simultaneously over a 10-year period of time, the economy would boom. All of that to say that this debt economy at the federal level with the federal government borrowing like they're drunk, I mean like they're stoned, and you borrowing like you're

drunk, like you're stoned on cars and student loans and furniture and vacations and all this, you drive the economy when you're doing that, but you're falsely driving it because it's a shell game. It's a house of cards, and it's going to come down. What goes up must come down when it has to do with debt. But if all of that spending was done with real money, meaning not borrowed money, you would see the economy increase, you would see prosperity increase, you'd see individual wealth increasing, you would see

charitable giving increasing. This is what would happen if people moved towards God's ways of handling money. Which, by the way, this is not my plan. This is God's and Grandma's ways of handling money. Live on less than you make. Live on a plan. Don't do get rich quick. Avoid debt.

Have money saved to buy things. Have money saved for emergencies. Have money saved to retire on. Have money saved to send your kid to college. Get out of debt. This is all in the Bible. It's all in your grandma's common sense. So it's not my plan.

It's God's and grandma's ways of handling money. It's common sense and biblical's ways of handling money. It's common sense and biblical finance, and it works. So if we could gradually get people to take steps that way, if you could just get your whole church to do it, it changes your whole church, which, by the way, whole churches are doing it, where they take 80% or more of their church through Financial Peace University. If you can just get a whole town to do it, if you can get a segment of the population to do it,

a certain people group, a minority, a region, you would see that group prosper. That's the answer to your question, Wayne. What would happen to the economy if everyone suddenly started doing your plan? It's not my plan. It's God's and Grandma's ways of handling money, and they can't do it suddenly. Everybody at once, because nobody at once does anything suddenly. Not 300 million people. But gradually, over the period of a decade, what would happen would be increased prosperity.

The same thing that happens to individual households when they get on a written plan called a budget so that they get out of debt, so that they can save and invest, so that they can be outrageously generous and have a higher quality life and become wealthy. That is the plan. And I don't know why it's not appealing to everyone. I don't understand. Why wouldn't you do that? You don't want to win? Really, why wouldn't you do that?

Because there's children out there and adult bodies. Adults devise a plan and follow it. Children do what feels good. One definition of maturity is learning to delay pleasure. It would require that the culture become more emotionally and spiritually mature. And we're going the other direction, actually. So I've still got work to do. Never fear. We're here. This is the Dave Ramsey Show. Please hear me loud and clear.

The government is not going to bail you out of your student loans, at least not completely and not without a catch. What they're talking about only impacts federal, not private loans, and you need to take responsibility for what you owe and pay your debt down quicker. Right now, Splash Financial is offering their lowest rates ever. With lower rates and extra payments, you could just find yourself debt-free in the next five years. Visit SplashFinancial.com slash Ramsey Solutions, Brian is with us. Coming in here wearing an Avalanche jersey in the middle of Predators country. What's up with that? I like the Predators, too.

I like the M's, too. So there you go. It's all good, brother. Welcome. Good to have you. Thank you for having me. So I'm guessing you're from Denver. Yes.

Okay. There we go. Cool. And all the way from Denver to do your debt-free scream. That's correct. Fun. And who's this young man you brought with you? My nine-year-old son.

What's his name? Isaac. Isaac. Welcome, Isaac. Good to have you, sir. Well, good, man. How much debt did you pay off? $150,000. Wow. How long did this take? About six and a half years. Okay, cool. And your range of income during that time? The majority of it was about $40,000 to $60,000, and then the last two years have been about $150,000. Whoa, what

happened? I got a blessing. I got fired and then started doing real estate full-time. Best thing that ever happened to me. I got fired. Well, I'm telling you, when you're handling your money right, sometimes that's exactly how it works. Yeah. So you sell real estate for a living? Yes, sir. Good for you.

Well done. So what is this $150,000 debt? It was a car, credit card, 401k loan, lawyer, and my house. Wow. Oh, you paid off your house? Yes, sir. Woo! A real estate agent with a paid-for house.

Yeah. There we go. I'm a unicorn. That's a unicorn right there, man, for sure. Well done, dude. Well done. So tell me the story. What happened six and a half years ago that put you on this process?

Well, it started about 10 years ago. I was having my son, and I was working. That's when I started real estate. That's when I got licensed. And I had lost my job, and the market had started to turn. I owned two places. His mom owned one. We combined.

The renter stopped paying, so we claimed bankruptcy. A couple years later, the marriage wasn't going great. His mom owned one. We combined. The renter stopped paying, so we claimed bankruptcy. A couple years later, the marriage wasn't going great. We were legally separated. I was living on the couch. She was upstairs. And then I came home from a double one day, and she'd taken half my things and my son and wouldn't let me see him. And, man, I was broke.

Like, I was, like, spiritually, emotionally, financially just broke on every level. So I got a lawyer and got emergency orders to get my son. And I was calling my friend who was younger than me, doing a lot better than me, and he just kept saying, you need to listen to Dave Ramsey. He bought me your book. It sat there, collected dust. And then he would stop talking to me until I would. So I read your book, and then I listened to you every day. And that really just begun everything.

Wow. Good for you, man. What a big turn in six years. Yeah. You've been through a lot. Yeah. Very cool. How's it feel now to be on the other side of all of this with 100% debt free?

Man, it's amazing. It's surreal. It it's surreal it's unbelievable it's going to cause your income to go up because you don't even need money now that's right you know you don't you know because the salesperson who's hungry always smells bad you know it just changes it changes your attitude changes the way you walk good for you man congratulations so what do you tell people the key to turning everything around because you turned turned everything around, but I mean, the getting out of debt. What are the things they need to do to get out of debt? Definitely need to stick with it.

It's not a straight line by any means. The budget. I had a great lady helping me with my budget. She actually is endorsed by you, I think, Melinda. But the budget and stick with it. You've got to keep going. I mean, it's very hard. When you're by yourself and you're going through all that emotional turmoil with a family and

everything, you do fall off the wagon, don't you? Yes. What enables you to get back on? Because a lot of people, when they try it and it doesn't work, they fall off and they never get back on. How'd you get back on? You just got to keep going and just baby steps and then i guess kind of allow yourself to fall off a little but just get right back on um nothing's

permanent or forever so yeah yeah except except when you quit that's right that's it well done man very well done i love it congratulations very cool what was the hardest part for you um well i've read your book and i'm real glad to know you is there an easy part fair point it's not hey the price to be paid the price to pay the price you pay to win is never an easy price no in anything there's always a and it's always a price that but it's always a price that's worth paying. Because when you get there, you're like, yeah, I'll do it again. Yep. Yep.

Yep. I'll do it again. Very cool. Well done, sir. Proud of you. We 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 a millionaire and outrageously generous along the way. Now, is Mr. Isaac learning all this stuff along the way?

Oh, yes. Very good. He has to. It's mandatory. There you go. I love it. All right. It's Brian and Isaac from Denver, Colorado.

$150,000 paid off in six and a half years, making $40,000 to $60,000 to $150,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! I love that. Well done, sir. Well done, sir.

Man, that's just awesome. Wow. Free call. 888-825-5225. Adam is in Indianapolis. Hi, Adam. How are you? I'm doing fine, thanks.

How are you, Dave? Better than I deserve. What's up? Yes, thanks for accepting this phone call. I've got two debts right now. One is a mortgage that I have on my home. And the only other debt I have was a personal loan my father had offered to me when I had gotten in trouble.

He paid for my attorney. And so I'm about halfway through paying off that personal loan. I'm just kind of trying to gauge as to where I should be saving and spending my money in terms of paying off my debts, the two that I have left. Should I pay off my father first and then worry about the mortgage? Yes. Definitely clear that. I'm sorry, go ahead. Definitely clear that, Dad. Yeah. Okay, the reason why I ask is because for me, it's kind of like the monthly installment is always a good reminder of the wrong I have done,

and it kind of keeps me in check a little bit. He also has mentioned numerous times, do not pay me back. He said that since I didn't get married, my other siblings did, he would just give that to me as sort of a wedding present. I just don't personally feel like I could accept such a present. What's the balance? What's the balance owed to him? I owe $12,500. And what is your income? Well, that's the thing. I get a disability through the VA. I served and came out a different person. And so I get $3,000 about take-home from the VA and $1,000 from Social Security. And then I get $500 a month because I rent out a room in my house, about $4,500 a month.

And that's your entire income? Correct. Okay. Are you planning on engaging in a career in the future? If things progress, yeah, I keep going back and forth, you know, with getting better, my recovery. And so I think it's just kind of take it one day at a time you know if i were to just right now um not be able to if i were to mentally not know i can't work in the future

that would kind of devastate me but um i mean it's definitely a goal that i have in the future okay well thank you for your service we appreciate that and i would clear your dad's debt um and then when if he wants to and the way I would do it is this. I would just keep paying monthly payments and save up the money to pay off the balance all at once. Okay, I do have about $21,000 in savings right now. Call dad. Call dad and say, Dad, I'm going to clear this debt today. Okay.

And there's a possibility he says, Don't. I'm just going to forgive it either one's fine with me if you want to accept the forgiveness of the debt and he wants to do that because he's as he said paid for weddings and stuff on the other side that's fine i don't think you're doing anything wrong in your recovery to accept a the forgiveness of that debt by your dad because you're doing all the hard work to stay sober and stay straight and do all the stuff you're doing. Okay.

So now if you do end up writing him that check, I want you to keep a copy of that check and I want you to frame it and hang it over where you pay your bills by your computer. So you see it all the time. You wanted that monthly reminder. I'll just hang it right there and let you have a permanent reminder. And, but I wouldn't just keep paying payments as my monthly reminder. I think you're in better shape than that. Let's get rid of this debt one way or the other right now. This is the Dave Ramsey Show. You may feel like there's not a lot you can control these days, but I'm here to tell you, you can control your budget and you can control what you feed your family.

My longtime friends at eMeals are here to help. They have simplified meal plans and created new recipe collections such as easy pantry meals and freezer meals utilizing basic ingredients. It has never been easier to shop smarter and stay on a budget. Try it free for two full weeks at eMeals.com. Thanks for joining us, America.

This is the Dave Ramsey Show. We teach you to live on less than you make. A concept Congress certainly can't grasp. Zane is with us in Oklahoma City. Hi, Zane. How are you? I'm good. How are you? Better than I deserve. What's up? Hey, I was just wondering if I should buy a house in the current market.

Currently, my wife and I are renting, and we just finished Baby Step 3, but we don't have the down payment, say, that you typically talk for, but we have never bought a house before, so I know sometimes you tell people that it's okay to go ahead and buy. Yeah, I mean, the trick is this you're not going

to put 20 down in your case and if you're not a first time if you are a first-time home buyer that's not unusual you just know that you're taking on pmi private mortgage insurance by not putting down 20 but you don't use your emergency fund as your down payment either right so um you know if you take out a 95 conventional fannie mae loan that's what i would recommend or less um and where the payment on a 15 year fixed is no more than a fourth of your take-home pay i don't yell at people for that in your situation yeah but you'd have to have a five percent down payment okay that's your minimum i mean that that's the minimum to even get in the deal here. And that's the only way I would do it.

But even then, you know that you're taking on PMI, and per $100,000 borrowed, it's about $75 a month. So you're going to be giving them a lot of money for that. So you're going to want to get that thing paid down and get rid of that PMI as quickly as you can once you jump in there. But, hey, congratulations on getting to Baby Step 3B. Lisa's in West Palm Beach, Florida. Hi, Lisa. How are you? Hi, Dave.

How are you? Better than I deserve. What's up? I took your class at Christ Fellowship, and we loved your class, my husband and I. Thank you. We love Christ Fellowship. I know. We are 50 and I. Thank you. We love Christ Fellowship. I know. We are 50 and 52. And years ago, before

we knew about Dave Ramsey, I bought Universal Life to help a family member out. And I know now that you're totally against it. I am married to a smoker for almost 23 years who is almost not a smoker. And when I've looked into getting the term insurance, it's outrageous. And I know I've paid a ton of money. I paid $280 a month for both of us for life insurance. And I just wondered, we are on baby step five. And I've kind of banked on the cash value because we have about $100,000 combined. Should I take that money out for my son who's a junior in high school to go to college, or should I take it out and pay off the $35,000 we owe on our home that has a value of about $350,000?

You can probably do both. What's your household income? I don't know. I mean, our household income is about $100,000. Okay. But you said there's how much in cash value? About $100,000 combined. We both have about $50,000.

So if you got term insurance in place and you had $100,000 in your hand, you pay off your house, you still got $65,000 in your hand. Right, but we don't have term insurance yet. No, I'm just saying, if you did, the point is that $65,000 ought to take care of that college. Right, absolutely. Okay, so you ought to be able to do both is what I was saying. Okay. College and pay off your mortgage. And if you make $100,000 a year and you don't have any debt in the world,

you can help cash flow college out of that budget if you come up a little short on that. Now, term insurance, then the question becomes, what is the size of your nest egg? How much is in your 401Ks? Probably about $250. Okay. So you're not quite self-insured. How much is the face value of these policies? On him.

Like how much do we pay monthly? No, the death benefit. Oh. To pay if you die. $250. On each of you? Yes. Okay.

All right. And did you price term insurance for $250? I have not. Okay. How much did you price it for? Well, I guess everything I kind of plugged in on X zander it looked like it was going to be a whole lot more than but what'd you plug in more than 250 000 yes okay my point is if you go back just for uh just for a math comparison you're going to find that even at 52 with a smoker on a 15 year

or a 10 year level term probably don't need more than about a 10-year level term, buying $250 on him and $250 on you is going to be cheaper than you're paying now. Right. Okay, so let's walk through this. You're going to have a paid-for house and a paid-for college and pay less now than you're paying for the same amount of insurance, even though he's a smoker. Okay, and are there any penalties for taking that out? No.

Okay. There's penalties for leaving it in. I know. I'm stupid. No. We've all been stupid, kiddo. That's not the issue. So it's kind of what I've been thinking about all along, but I've never been able to get

through. Yeah. So, I mean, the thing is you don't have to go by 10 to 12 times his income because you're debt free your kid is almost grown and gone and you've got 250 000 already saved so all i'm trying to do is supplement that situation with another 250 000 if he died today okay you'd have zero debt kid is college is covered and a paid for house and you'd have 500 000 you'd be okay so we just go into prudential and let them know that we want to you don't have to go in just send them just send them an email and say cancel the policy

or a letter i wouldn't get in a big long discussion with prudential for god's sakes okay and then they just send you a check? They're awful. Yeah. They'll send you some paperwork that you've got to fill out to cancel the policy because they want to make it difficult so that they have every opportunity to talk you out of it. But don't do that until you have your term insurance in place. So jump on Zander and look at like $250 and like $400 on a 10-year. And that's probably enough in your situation, especially on him because he's a smoker.

Okay. He's almost not a smoker, though. Yeah. Should I wait? Well, you could do that. I mean, or you could just rewrite the policy later. You might keep it a year and then rewrite it after he's not a smoker. Usually, once you're quit for a year, your rates go down.

Okay. And then two years another time. So you can look at that. But, no, I wouldn't keep paying this. it after he's not a smoker usually once you're quit for a year your rates go down okay and then two years another time so you can look at that but no i wouldn't keep paying this it's just it's trash you need the money pay off the house get the kid in college all that so now let's get some term insurance in place now and cancel this garbage hey thanks for the call joshua is with us in kansas city hi joshua how are you i'm good How are you? I'm good. How are you? Better than I deserve. What's up? Me and my brother, we're going to start a business.

So I was wondering if you had any business tips for us. What kind of a business are you going to start? We're going to start cleaning up people's backyards. Okay. What's wrong with their backyards that needs to be cleaned up? I'm confused. Well, we were going to mow their yards and clean up after their dogs. Oh, I got you. Okay. How old are you? I'm 14.

Oh, okay. All right. Well, the business tips are fairly simple. The basics of business are you need customers, and so that's marketing. How are you going to get customers? We're going door-to-door. There you go. That's your marketing acquisition plan, your customer acquisition plan. You're going to go door-to-door, and then once you've got the customers,

then you've got to just put together your pricing plan and say, well, how are we going to price this by the job or by the hour or whatever? And then minus whatever expenses you have will be your net profit on that. And I recommend you go ahead and put that on a little spreadsheet or something so you actually track your business and figure out what you're making instead of just getting the cash from the owner for cutting the grass and then put it in your pocket and then don't know what happened to it. So let's actually track and go, hey, this summer we made this much money. You know, this year we made this much money. And it's good to have a, it gives you some feedback that says, so this is working.

Also makes you stop and think, well, I'm not charging enough or I'm charging too much because I can't get customers in that case. But your pricing model, whether you're going to do it by the hour or by the job, tracking it, that's called the accounting, meaning you track your income minus your expenses as your net profit. A simple spreadsheet will do that in your situation. And then going and getting your customers and, you know, whatever equipment you need to do this. If you're using your dad's lawnmower or whatever, that's fine. That's how I did it when I was a little younger than you all the way up through your age. And you're probably going to learn a lot doing this.

Good for you. Well done. This is the Dave Ramsey Show. In the middle of these uncertain times, Ramsey Solutions wants to give you some hope for the very first time ever. We're giving you Financial Peace University free for 14 days. Go to DaveRamsey.com slash hope so you can watch from home.