The Ramsey Show - App - Does the Debt Snowball Apply to My Situation? (Hour 3)

Episode Date: September 7, 2022

Take our Audience Survey & Enter to Win a $500 Visa Gift Card: Click here to take the Survey Dave Ramsey & George Kamel discuss: The debt snowball applied to rental properties, Upgrading a home vs. moving, Whether or not braces go in the debt snowball, Using a HELOC to buy a rental property, Preparing for life after college. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving in the storage studio, it's the 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. We help people build wealth, do work that they love, and create actual amazing relationships. George Campbell, Ramsey Personality, is my co-host today as we answer your questions about your life and your money.

Open phones at 888-825-5225. Mike is in Baton Rouge, Louisiana. Hey, Mike, welcome to the Ramsey Show. Hey, Dave, how are you? Thanks for having me on the show sure what's up well got a question for you um my wife and i've been following the baby steps uh we are consumer debt free uh no car loans um other than only thing we owe is, um, on our primary residence. And then I have several rental properties, um, that I've got five that still have a note on them. Um, we have two senior college kids and so we've got about one semester left and we've been cashflow in that.

So my, my question is about the rentals. Um, is it, you know, I've got a couple of them that have like a one has a note of 20 000 one has a note of uh you know a little less than 40 000 is it okay to do the uh debt snowball on those and as i pay those off you know keep paying those off and then move to my primary residence or does it make more sense to sell a few of those off and just wipe out the primary residence how many rental properties do you own total i have 10 okay and five of them have a note and 20 and 40 and what other kind of notes uh one is like 70 another one is like eight little over 80 and then the last one is uh like 125 okay and your personal residence is how much owed on it uh 320 and your household income is what

uh my wife and i make about a little over 200 a year cool how old are y'all 55 55 yeah yeah that's about right okay um yeah uh so two two approaches since your since your notes on your rentals are very small compared to your house yeah i would do those first because they're easy right uh if they were equal i'd pay off your house first but they're not equal okay so it doesn't come up but um um and so the debt snowball does work so there's two approaches you could use to this and anywhere in between those two approaches is fine one is simply like you said just debt snowball them and then pay off your house as quick as you can after that with all the increased cash flow you got all the cash flow from 10 rentals plus you got the household income of 200 so you knock out the 300 in what couple of years probably

maybe maybe three years something like that so uh you know by the time you're 60 you need to be done with all this right that's what i'm saying okay now if however you wanted to go crazy and just be done now you probably could sell half these rentals and clear and clear everything couldn't you yeah yeah i have about 700 000 in equity yeah so that that's the other side of the spectrum one spectrum is the slow way plot out over five years one's the instant way now and you could do anything in between which is probably what i would do is something in between because generally speaking when i meet people that have 10 rental properties they have two of them they really don't like that much

right and that's the two i'm gonna sell and so now now i now i'm not gonna get rid of all of it right now today but i'm gonna accelerate this five year to maybe a three year by picking off two or three that i'm not that thrilled with anyway i might not buy them again if i didn't already own them kind of property and just clear those notes and those and throw those equities at the other rentals and or at the house and so none of this is required anywhere in there is okay all at once today by selling enough of it to just clear everything and you know you got three cleared properties and you're cleared house and boom we're done okay that's today the other way is five years you slow walk it out and then somewhere in between a hybrid

which is getting rid of something you probably don't even like anyway that you don't you know five years from now you know that the house is not it's not done that good it's a pain in the butt it's always you know it's a older property it's hard to maintain it's a neighborhood that's not doing that great the type of renters i get in there aren't that great whatever it is something that that's the way i would find a property i didn't like in my portfolio i'd going, this one is less fun than the other ones, you know? What's your long-term plan, Mike? Do you want to retire in a few years? Have you talked to your wife about this? Well, she'd like to retire tomorrow, but no, we're probably looking at, my wife's a travel nurse and I'm in sales, so we're probably looking anywhere between, you know, probably 10

years from now. Okay. This just helps me drive the decision to go, okay, if she wants to stop working tomorrow, I might be selling some of these properties versus using our future income to try to pay them off more slowly. So I would have a conversation with your wife about this, make that decision together. But I like the plan of splitting the difference. And if it's not enough, we go, all right, we're going to sell the next least favorite one to speed this up. Yeah. And just, you know, I'm probably going to pick off two or three of these that I'm not that excited about anyway and accelerate this

and make it a three-year or three-and-a-half-year plan or whatever. But it's a five-year plan if you don't sell anything. It's what the math is telling me. I'm just doing quick numbers in my head, but I think I'm pretty close on that. Hey, that's well done, sir. You've done great building this up i'm proud of you good good work a lot of stuff you can do there a lot of stuff you can do mike is with us in saint paul hey mike welcome to the ramsey show yeah hi dave thanks for having me sure what's up yeah so my question is uh that my wife and i are looking for some advice on whether or not paying off our current home and paying for a lot of upgrades to modernize it or selling it and purchasing a more modern home and starting with a fresh mortgage.

What's it going to cost to update the house? It's going to cost about $100,000 to upgrade the house. We're looking at siding a master bath, finishing a basement, and a kitchen. Wow, that's a lot. Do you think that will increase the value by $100,000? That's a tough question with today's market kind of changing so much so quickly. We just know that, you know, emotionally, you know, it's hard for us to kind of wrap our heads around that. You know, hiring out contractors, getting bids, having our house torn apart. And then also how long that, you know, all those projects look like.

I only did a minor remodel that's not as extensive as you're talking about while I was living in the house one time, and I distinctly remember sitting in a lawn chair on plywood where they had ripped the carpet up in my master bedroom watching television, and I told my wife, you might be a redneck if you are in your master bedroom watching a big screen on plywood in a lawn chair. And so, yeah. And so I just, that was the end of me doing this stuff. So if I'm in your shoes, I'm just going to go buy something. I wouldn't fool with it. Life is too

short to remodel a house while you live in it. It's a pain in the butt. Sawdust in everything. It's hard. Now, light remodels are one thing but what you're talking about is very extensive it's almost as extensive as building a house and uh i personally wouldn't do that i'd move out and uh i just go buy something life i mean there's houses everywhere that's what i would do this is the Ramsey Show. thanks for joining us america george camel ramsey personality is my co-host today when you're worried about money, it's all you can think about. Stress affects your marriage, your family, your career. It affects everything until one day you look up and you feel like everything's on fire.

Well, you shouldn't have to live this way. And by the way, you don't have to. When you have a plan, you will discover peace in your life that you didn't think was possible. Financial Peace University, you'll learn the same plan that almost 10 million people have on how to budget, how to save and spend wisely, how to get out of debt, become wealthy, outrageously generous. And the course includes Dr. John Deloney and George Camel and Rachel Cruz and me. It's the best version of Financial Peace University we've ever done. And we're offering it at the lowest price we ever have

to make it as easy as possible to get started. So decide today that you're done letting money stress rule your life. Get started with Financial Peace University by visiting ramsaysolutions.com slash FPU, ramsaysolutions.com slash FPU. George, it's worth noting that while everything else is going up with inflation, the cost for Financial Peace University

is the lowest it has ever been right now. I don't know how you did it, Dave. It's worth noting. That's amazing. Worth noting. I have nothing to do with it. Someone over in Financial Peace University

decided to lower the price and didn't even ask me. It's worth every penny. I mean, the turnarounds we see in the first few months of doing this stuff, you save thousands of dollars, pay off thousands of dollars of debt

that you wouldn't have otherwise if you didn't follow this plan. It's crazy. Absolutely works. All right. Valerie's in San Antonio. Hey, Valerie, how are you? Hi, I'm good. How are you, Mr. Ramsey? Better than I deserve. How can we help? I have a quick question about baby steps. I'm on baby step two. And after we pay off our credit cards, technically our next debt is my daughter's braces. We owe about $3,800 on them now. My question is though, should we pay that all off because my husband is looking for another job and we wouldn't be living in the same city or do i still pay it off and then move on you know i'm sorry if you move cities they're going to take our braces out no i just didn't know if you pay off that debt if we have to go to another orthodontics

um if they would honor that or i'm not sure how that works so you're in debt for the entire treatment plan but you're saying the treatment plan isn't done would honor that, or I'm not sure how that works. So you're in debt for the entire treatment plan, but you're saying the treatment plan isn't done, and you're moving in the middle of it. No, yes. Well, my husband's looking for another job. We're from the north. We live in Texas right now, and it's just too hot for us. So she will have braces, they predict, about two years.

I'm assuming we're going to move in the meantime, but I just don't know. I wasn't sure. I'm not sure exactly how this works. You're saying you're going to have to pay someone to finish dealing with her braces in another city, right? Yes. And you're not going to have to pay the orthodontist that put them in? Well, I'm making a monthly payment right now. I know, but I mean, if you move, if you move, you don't have to pay them? I don't know how that works. I don't either.

I think you've got to pay them. Yeah, well, I don't know because they said it's for the full treatment. Well, call them and ask them and tell them you're thinking about moving. And what, what do you owe today if you were to move? Okay. And pay that. And the reason I ask, because, okay, because our next debt is our car, which is much more. So I wasn't sure, you know, how that works. I want, you know, I'm guessing that there is, I don't know what they're doing here. I don't know how it works.

So, yeah, you do want to clear it, though. You don't want to have a debt hanging over your head when you're in another city on these braces. Okay. So you need to find out what the debt is in the event you move in the next three months and clear that. And then if you stay, then you'll continue the plan. You'd pay the rest of it off right if you'd move then you've cleared it and you're good to go right yes by the way get all that in writing so there's no confusion later don't uh it's not that they would rip you off

necessarily uh orthodontists aren't known for being scam artists or anything like that but sometimes there's confusion and when it's down, it gets rid of the confusion. And there may be something in that contract for the treatment plan that says, this is what you owe us, regardless of what you do with your life. And so it may be the case. I'm kind of afraid you owe the whole thing, but I don't know how that works. Jonathan is in Denver. Hey, Jonathan, welcome to the Ramsey Show.

Hey, Mr. Ramsey, George. Nice talking to you guys. You too. How can we help? So me and my girlfriend have been dating for around eight months now. I have introduced her to your guys' plan. I'm trying to find the best way to help her without being an enabler or any sort of back end where she ends up just relying on me.

She doesn't appreciate when I do, like, ask her if she would like some money and when, you know, there's a couple weeks where she would dig down on me because she would end up just saying that she's broke or, like, she just can't find a way out. So I'm just trying to find the best way to help her without being an enabler. So she's

actively asking you for money regularly? No. She never does. It's more like I ask her if she would like some money just because I don't like seeing her struggle. And she's offended by that? I wouldn't say she's offended.

She doesn't take any sort of like offense to it, any offensive stand. She's very understanding. She's very caring. Okay, so what's her problem? How much debt does she have? I am unsure. She won't disclose that to me. Like I said, we're still dating it's not like

we're married or anything like that but i do see her as a potential i do see as me and her getting married because uh not until you find out what the flip's going on yeah um i mean i she's currently in school um there is times where uh is a CNA, so she gets put on call at times. I have, you know, informed her like, hey, you know, can you try looking at other departments in your hospital to see if you could get, you know, any extra income or anything like that. But I just feel like sometimes she tries. How old are you?

I'm 24. How old are you? I'm 24. How old is she? She's 24 as well. Okay. All right. So here's the thing. In your mind, this relationship has progressed further than it has in hers. You are completely dabbling in her business,

and she doesn't want you to know what it is correct you are further along the path than she is i do feel like in terms of emotion um it is mutual but in terms of finance no it's not because you're willing to tell her everything about you and about your money and she's not willing to tell her everything about you and about your money, and she's not willing to tell you what's going on with her money. Correct. And that may be coming from shame and some baggage, but we have to unpack this before this relationship progresses any further.

Correct. Now, this is a blockade to you all getting to know each other better at a deep level. It's called intimacy, okay? And so emotional intimacy. And so you guys getting to know each other and disclosing and starting to share life is a precursor to you guys going into an engagement. And so until she's ready to take that next step, you're standing over here ready to go, step she's not ready to go.

And so I guess you've just got to find out, A, is this shame, or B, is she just not ready to move forward as much as you're ready to move forward? Either one's possible. I do feel it's more in the shame part, just because there is points where you know uh she is hard on money and she still tries to work find a way to budget and make herself make her end you don't have any idea what's going on because you don't know how much she has in debt you don't know how much income she has you don't know what's going on all you saw is your girlfriend

crying that's all you know yeah I mean I mean, I do know what she makes. She has disclosed some information in terms of, like, what she makes, what she's trying to do. But in terms of, like, her debt, her student loans and stuff, I've asked her, and it's more like I feel like she's ashamed. Well, I mean, you can't go forward in this relationship until she can get past this. It's a blockade. And so you got to just back up and give this some more time. Or it's a cut bait thing, one of the two. I don't know which it is.

But it doesn't sound like it's that yet. But at some point, we have to be able to open up about these things in spite of shame, in spite of pride, whatever it is. This is The Ramsey Show. thank you for joining us america george camel ramsey personality is my co-host today open phones at 888-825-5225 anth Anthony is with us in Colorado Springs. Hi, Anthony. Welcome to the Ramsey Show. Good afternoon, guys. Thank you for taking our call. Sure. What's up? So my wife and I are realtors here in Colorado, and we paid off our first primary residence, which is now an investment property, and now we just paid off our current primary residence. Um, we have, what's that, sir? I said, way to go. Oh, thank you, sir. Appreciate that. Um, we have no debt. Um, cars are paid off. Both of our

degrees are paid off. Um, my question is, is we're considering an investment, our third, I guess our second investment property. Um, and the rates are really high, but we did get a HELOC and we did get approved on our primary residence. And we wanted your thoughts on moving forward with the HELOC. We did do some numbers and we're looking at about $500 a month cash flow on this particular property. That's when it's rented. Correct, yes, sir. And you know they're not always rented. Yes, sir.

And you know renters don't always pay. Yes, sir. Okay. So I'm pointing out the obvious, but what is interesting is that those of us that are real estate people, you and me, one of the things that happens when we get to be real estate people is they take our risk meter out and they break it with a hammer, and we no longer perceive risk.

And we say things like, oh, it's going to cash flow $500 in a perfect freaking world only, you know. But nobody tells that out loud, that heat and airs go out and it's 3,500 bucks or roof leak over here or water heater blows out the pop-off valve and the half the basement floods and oh by the way the renter is going to sue you for that too and nobody brings this stuff up it's part of the equation though I don't mind it I it's part of real estate I own a bunch of real estate as you probably know but um yeah the cash flow can be a bit overstated when we don't take all things into consideration. So, Anthony, I mean, I don't know how long you guys have been listening to us, but we tell folks not to borrow money.

Okay. And so the way I built my second real estate portfolio, the way I built the first one is like you're doing, and I went broke and lost it all. The way I built my second one is like you're doing, and I went broke and lost it all. The way I built my second one is I paid cash for it, and it was slower. Now, you have no house payment, dude, and you have a rental property with no debt on it, so it's cash flowing like a bandit in that sense. I mean, every bit of money that thing makes, it really makes.

None of it has to go to the bank. And I'm going to guess and say that you said both of you are in real estate. I'm going to guess and say you guys are making north of $200,000, aren't you? What do you make? We made $400,000 last year. Yeah, okay. I thought you were killing it. Maybe not this year.

Maybe things are slowing down a little. But $300,000 to $400,000, okay. not this year maybe things are slowing down a little but but but three to four hundred okay and um and and what can happen is is that you begin to feel bulletproof and you don't perceive the risk anymore in these situations so i i'm always going to teach you what we have found to be true with the vast majority of millionaires we've studied and that is be the tortoise slow and steady and ugly and he always wins the race and i'm going to save up and pay cash for it i will tell you that a beautiful thing happens when you get to three or four properties pretty quickly uh your your rental income will buy you another house every year. That's awesome.

But it takes a little while, and the first two are like pulling teeth, and you're tempted to go do a HELOC because everything in your real estate world, everything in the world I grew up in, tells you to borrow money. No one in the real estate business runs around saying be debt-free. It just doesn't happen. But when I find millionaires and i study them that own real estate almost all of them did it without debt or got out of the debt as quickly as they possibly could like you did the first time something drove you to get out of debt yes sir so you're saying even if we have to wait till like next summer if

we're going to pay cash that that's the route to go? That's less than a year away. We're not talking 10 years from now. Yeah. You guys have a great income. You could buy this rental property a year from now, do a little slower with way less risk. Yeah.

Just be steady, be steady, be steady, be steady. Here's the thing. We've done detailed research. 100% of the foreclosures occur on a home with a mortgage when when a pandemic hits when a when your tenant goes into chapter seven and it's uh four months before the court opens that case up and you don't get any payments during that time you got no issue or someday it could happen to you like it did a while to me a while back a came up and said, hey, my wife's got cancer and it's stage four, and we don't know what we're going to do. We're scared.

And we just said, well, let's just take it. Well, you keep us informed. We want to stay up with what's going on. But we were able to give them a break and not have to charge them for a while. You know, you get yourself in those kinds of positions that you can be generous and compassionate when and you can and you don't get caught by somebody who's trying to mess you over in another case where somebody just doesn't want to pay and you have a pandemic moratorium on evictions or some kind of crap like that um and you know i've been doing this all 30 years and it's just there's something always missing with your real estate.

Real estate's a wonderful investment, and I love it, and I want you to do it, but I want you to pay cash. That's what I would do if I were in your shoes. It's what I have done, and now I own several hundred million dollars worth of real estate. I mean, the building we're sitting in alone is $100 million. So, you know, just as an example. But that's, you know, it's, yeah, that's what I want you to do.

Well, you make different decisions when you can do it with no debt, with a lot of clarity, move slowly, use wisdom, and not be desperate because you owe the lender. I like that plan. There's a steady grace is the word, gracefulness. The movements are more of a dance rather than a thrashing about. It's not a mosh pit at a punk rock concert. At the rock show, yeah.

And that's pretty, you know, the the people that we find that really build wealth they have this steady move um you know almost like it's a martial arts workout or something or a yoga move or something like that and uh the tiktok real estate investors are pretty much a punk rock mosh pit and you're going to get about the same different result i mean there's different things that there's just you're going to get a bloody nose in the mosh pit. That's all I'm saying. There's a flow to it here. You know, crowd surfing with undependable people.

You know, that's all it is. But, yeah, that's Dr. John Deloney's field, I guess. I shouldn't be stepping into his area of expertise. Your yoga, John Deloney's yoga. Yeah, I look like yoga, but yeah. But that's not the point. But there is this, when I find people who have built wealth, I never thought about it until just sitting here thinking about it out loud right now,

but there is a graceful movement to the cadence. They're not rushed. To what you're doing. There's no rush. There's a graceful movement to the cadence. They're not rushed. To what you're doing. There's no rush. There's a wisdom. It can be kind. It's very strong. It can be courageous.

But those movements have all of that in play, and it affects how well the investments do. Because you don't have to force everything. There's not as much friction. There's not as much friction there's not as much there's not as much pressure angst around it and uh we take all of that out out when you put debt on it and the more debt you put on it the more wild and crazy and more zeros thrashing about that there is and all that and it's just um yeah there is a risk factor when we had grand steph grand gram stefan the other day, we were talking about that on his podcast that we recorded.

I guess, I don't know, has that dropped yet? Yeah, it's all out there. Is it? Okay. Ice Coffee Hour on his separate channel, and you are on his channel once or twice. They're reviewing his portfolio. Yeah, and he came on here for a little while on this show. Yeah. A sharp young guy.

But we were just talking, because he's a well-known big-time YouTuber on the uh real estate investing stuff and we disagree on the financial so we well not not violently i mean we're friends but um um and he's a uh sharp young guy but uh but it was it was a fun discussion but that's the kind of thing i i wish i thought of that example even when I was with him, that there's a gracefulness, a smooth movement of kindness and courage and strength that is different than when you're leveraged to your eyeballs. You know, it just changes everything. This is The Ramsey Show. so so our scripture of the day colossians 3 13 bear with each other and forgive one another if any of you has a grievance against someone.

Forgive as the Lord forgave you. Mark Twain said, Forgiveness is the fragrance that the violet sheds on the heel that has crushed it. Ooh, true poet. Look at that. He should be a writer. Open phones at 888-825-5225. Georgeel, Ramsey personality, is my co-host today. Tyler is next in Grand Rapids, Michigan.

Hey, Tyler, what's up in your world? Not much. What's up in yours? Struggling through, brother. How can we help? So I would love to run my situation by you and then kind of get your thoughts. So a quick summary would be

that I'm graduating from local university here in December, a degree in finance, and I'm graduating debt-free thanks almost entirely in part to my amazing parents. Way to go. Very good. Recently in terms of yesterday, I accepted a return offer stemming from my summer internship at one of the largest banks in the country. Way to go. What are, in your opinion, some of the biggest pitfalls or mistakes that people in my situation tend to make, and what would be the best way to go about avoiding them? So you're saying my first adult big boy job out of college, I don't want to screw this up.

Well, number one, the principles that got you through school debt-free, I want you to carry throughout, which is wise planning, diligence, live on less than you make. Don't go out and buy a bunch of toys and get in a house and do things when you're not financially ready just because that's what you're supposed to do after college because you saw your friends do it. And now they're going, dude, you don't have a nice – why are you still driving that beater car? You don't have a house yet? Dude, you have a great job in finance. What are you still driving that beater car? You don't have a house yet? Dude, you have a great job in finance. What are you doing? That's what you're about to be up against in the adult world that no one tells you, is the amount of pressure and comparisons that are about to come your way.

So if you can battle against that, you are going to be just fine. Because you're coming out of this completely debt-free? Yes, correct. What do you drive? 2010 Ford Taurus with about 190 000 miles i love it okay and what will you be making at the new gig uh 70 a year and when does that start february 27 i graduate december february of 27?

What did you say? February 27th of this upcoming year. Oh, so this coming February. Okay. Correct, yeah. So two months after graduation. Okay. What I would do is get a modest apartment,

furnish it modestly, and pile up cash and get you a better car. Your car sucks. Yeah, I'm looking at upgrading. Yeah, maybe about as quick as you can save $5,000, $10,000. Let's move up in car. Okay. All right. If your car was a better car, I'd have you drive it for a year or two but this

one you need to upgrade this one um sure do and but you don't need to go into debt to do it we're going to pay cash and so first big cash goal is build your emergency fund the next big cash goal is save up and buy and move up in car five ten thousand bucks something like that um and then you're just going to start systematically moving towards uh you know you're investing and start invest you know whatever you're going to do you're going to pay cash for and we're going to start saving towards the first house um and get your 401k and that kind of stuff started probably down in the summer somewhere about about a year from now all that stuff will start hitting but it

sounds like you've studied our stuff like you know it all i know what we teach i've been an active listener yeah for the past two years uh then in high school we did a curriculum in one of my classes yeah good it's awesome so the foundations in personal finance our high school curriculum set the table for you that's perfect yeah so you're asking really mature wise questions because you know what does happen tyler and you've watched your friends do this maybe is the first thing people do when they come out of school is um they go get a car payment because they deserve a new car to go with their new job to go with their new apartment and they usually rent an apartment or house that is too nice.

I did. I didn't buy a new car, but I did. I mean, Sharon and I got married like two weeks after I graduated, and we rented a three-bedroom townhouse, and there were two of us. It was, I mean, you know, it didn't make, it was dumber than a rock. Why did we need three bedrooms? But we thought, you know, and six months later, we moved into a little one-bedroom because we grew up and we got smart, you know, and had an adult or two speak into my life and go that's stupid and um it was and and so but

that's uh uh and it was half the the one bedroom was half the price i mean it didn't make any sense to make any sense at all and he can get some roommates I mean, he's a single guy coming out of college. Yeah. But, yeah, so you're going to kind of get stabilized in your, you know, in your lifestyle and everything, and just don't jump in. The problem is people graduate, they start making $70,000, and they act like they're making $700,000, and they go bananas. And it's like they've been working four years living on you know uh cafeteria food um sitting on old used furniture and horrible stuff in the dorm or whatever and now i get to go out and have like a real life and then they they dramatically overspend

just blank check that thing tyler's not gonna do that no but some of tyler's friends are and he may already be observing that but the biggest mistake most people do is they go get a car payment day one as soon as they get out of school they go get a car and a big car payment and it's a very nice car that they can't afford so save up pay cash for a better car you do need to do that but we're going to pay cash and and then let's just cash flow no debt any moves you're going to make past that and furniture whatever it is you're doing and he set up the foundation i mean it's rare to meet a kid who's graduating completely debt-free because his parents yeah were wise so it sets him up differently than a kid who's coming out of college with 100 grand asking us what do i do now because now we go you got to clean up this mess

for the next three years exactly exactly so he's got an amazing you got three years of your life back that's the power of following this plan. So way to go, Tyler. It's encouraging. Actually, if you're more normal, you've got 10 years of your life back that you don't have this debt hanging around you, this epic failure of student loans. You know, George, I was thinking earlier today on that same subject, our documentary on student loans is absolutely a must-watch right now. It's even more relevant than when we released it.

Yeah, Borrowed Future, with all the discussion of student loans and of the cost of education and what the cost of education is going to do as a result of this forgiveness, if the forgiveness actually comes through from the Biden administration. It's yet to figure out if it does require an act of Congress or not. This time literally. Usually you say that ironically. Not as a figure of speech, but an actual act of Congress. Does Congress have to approve the spending?

And most people think they do. And so can you get that through before they the democrats do not any longer have a majority after midterms because they're going to take there's going to be a bloodbath on that uh most people say most people believe so then what do we do from there and um so borrowed future to set you up to have uh the young people in your life be a tyler instead of being hundreds of thousand dollars in debt it's it's just essential what you study matters where you study it matters and uh college choice is really tied into this whole epic failure called the student loan program and uh we disclose and uh uncover reveal the predatory nature of the whole program.

The underbelly of this thing is nasty. It is dark stuff. It's nasty and dark and evil, and it's out of control. And it was a well-intentioned idea that got the federal government's hands on it, which will screw up Christmas. And, man, it is a mess. that got the federal government's hands on it, which will screw up Christmas. And, man, it is a mess. And it still begs the question that we asked in the documentary or the statement that we asked in the documentary

that if you're going to forgive student loans while you're still making them, that is intellectually dishonest. If they're so bad and so oppressive and the poor people that have been taken advantage of, that they must be forgiven, and yet you're still making them. It's just straight up wrong. You're asking politicians to be logical, Dave. That's where you messed up. Well, critical thinking skills should be required somewhere in the vicinity of Washington, D.C., but apparently not.

Well, every parent needs to watch this because it'll spark some great conversations. Every parent, everybody that has a teenager, every teacher. If you're a teacher, we'll still let your classroom watch it for free, so get in touch with us. It's one of the biggest documentaries on Amazon Prime, so go out there and watch it. It's a Google Play. It's out there. Borrowed Future. this is the ramsey show dave here we just launched a brand new audience survey for The Ramsey Show,

and we'd love your feedback. You could be entered to win a $500 Visa gift card. No purchase necessary. Take the survey at RamseySolutions.com slash survey.