The Ramsey Show - App - Does Your Life Need a Radical Shake-Up? (Hour 1)

Episode Date: November 8, 2023

Девочка-пай Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Camel, joined by Rachel Cruz. This is The Ramsey Show. It is not Smart Money money happy hour which is another show that we co-host together but we're going to bring that kind of energy and fun today rachel we hope so it's going to be a fun show george we're already bringing it with our outfits we're very brightly colored today bright yellow bright orange so if you're watching on youtube i

apologize dim your screens my shirt is like get some sunglasses but it's fun it's it's what makes you so joyful and effervescent, Rachel. Right. Well, hey, give us a call. We'll talk about your life and your money at 888-825-5225. Jeff joins us in Toronto, Canada. Jeff, what's going on? Hi, thanks for your call, guys.

How are you doing? Doing well. How are you? Okay. I just wanted to talk to you today. We're concerned that we probably look better than we are. We've got no student debt, no credit card debt, no other debts per se other than the mortgage.

But the mortgage is $625,000 and amortized over 28 more years, and we're 49. So we've obviously sort of refinanced things into the mortgage a couple of too many times and we're on a variable mortgage. We can't help that right now. But I guess I'm wondering how should we look at our situation more like we have, say, a hundred grand left in mortgage debt, but we've maybe got a half a mil in debt we should really tackle. But this whole thing is in one mortgage? Yes. Okay. What's your household income?

210 Canadian. Okay. And what is the mortgage payment every month? Because of the variable rate, we're up to 6.2% now. So it's gone up to about just under 4,000. Wow. And what's your take-home pay? Take-home on that is about 11 months. Okay. All right. I mean, it's a hefty mortgage, even with your great income. I don't know that it's a fire right now.

You don't have any other debt, right? No, everything else is clean. So how much extra do you have as you kind of create a budget? How much extra do you have to throw at the mortgage every single month right now? Well, now that it's gone up like that and saving for general affairs and the four kids, very little. We're just trying to rebalance and bring it down to bare bones this week. Okay, so the other $7,000 is just disappearing into expenses, even with no debt. Well, yeah. Are you investing? is just disappearing into expenses, even with no debt. Well, yeah. Yeah, it's, you know, yeah.

Are you investing? Yeah, sorry, we do have retirement. We get a match at work, so I've got to keep that going because it's free money. What's the total you're investing out of your household income? What percent? On mine, it's 4%. 6% to get a match, and my wife's is 4%, so it's kind of like an average of 5% total.

Okay. Man, I'm still wondering where all the leftover money's going. I thought you were going to say we're investing 20%. No, gross is about $2,300. I mean, all the other insurances and things. Yeah, we're going to cut it down and try and cut it back. Okay. Well, to your original question, there's no way to really split this debt up. If it's in one giant mortgage, we're just going to attack it. You would be what we call baby step six if you have a fully funded emergency fund. Do you guys have that

money set aside in savings, three to six months of expenses? No. Okay. How much do you have in savings? Oh, it's just kind of month to month. So very little. We just throw that at them. So you're straight up paycheck to paycheck, even making 210. That's correct. Okay. Yeah. So Jeff, I think that's probably one of your biggest problems. It feels like, oh my gosh, we're on the edge because you kind of are on the edge if you don't have that savings. So I do think that buffer of six months put away is going to ease some of this tension. Knowing that there's cash there if something happens does lower your stress because, yes, you have the big mortgage, but other than that, you're going to be able to breathe at night when knowing that you have this emergency fund. So I think doing that's going to relieve some of the stress. And then I think, yeah,

you and your wife have to kind of look at each other and just be like, all right, this is our mortgage. And we don't want to live in too deep of sacrifice for too long, right? Because then you just burn out of steam if you're doing this for 10 years. But there needs to be enough. Yeah, 15 years. Yeah, right. So there needs to be enough. Yeah, 15 years. Yeah, right. So there needs to be enough, though, to say, yeah, we're feeling this progress. And again, I know the real estate market in Canada, it's wacky. I feel like it is here right now in America, too.

But maybe you guys look up in three to four years with things that have changed. And maybe you say, hey, maybe we would rather be out of debt faster than to keep this mortgage. And maybe there's some equity there and you make a different decision with the house if you want. Right now may not be the best time because I know rates and everything are just, it's nuts. So like George said, it's not on fire, but you guys may reconsider this mortgage, depending on how much it's still weighing on you here in a couple of years. Sure. If we could rent the house and actually take an apartment that was cheaper, I mean, that would create a cash flow benefit, would it? If we could rent the place for about the same

price as the mortgage? I mean, in a perfect world, yes. But then suddenly you have renters and you still have a mortgage on it. And if the renter doesn't pay, it's up to you. Or if something breaks, it's still up to you. I mean, you're still owning a house. I think that the passive cash flow that real estate provides is somewhat of a lie. It's not very passive. It's very reactive. Especially when you have debt on it. Yeah. And especially when it's not paid off. But I understand what you're saying. And yeah, the numbers would make sense, but life usually doesn't work that cleanly, sadly. I would work my way to aggressively attack this mortgage, and that might mean

we've got to get our income up. Even though you're making great money, it might mean a season of getting our income up, getting our expenses down. If you looked at your budget outside of your mortgage, what would you say are the biggest expenses eating away that take-home pay? $2,300 is attributed to groceries, $250 for dining out. Utilities are, say, $400 electric and water. How many kids do you all have, Jeff? Yeah, four. Okay. Now, I know Canadian food prices are insane.

Is $2,300 normal over there? That still feels really high. It feels like, yeah. Yeah, we're pretty, I think we're pretty conservative, but, I mean, $2,300 is everything. You know, anything that the house consumes, like soaps and food and that sort of thing. Household essentials, all that. Yeah. Well, I think Jeff,

I think y'all's first goal to feel some level of traction and peace is that emergency fund. I think that will really do something to you guys as a sense of confidence that you're not living on the edge cause you won't be. But that would be the next, that would be the, that would be the goal I tackle. And then you guys, I would up some of your retirement. I would still be investing

more than what you guys are, which I know is going to give you even less to put at the mortgage. But that's when I feel like you guys could maybe re-evaluate this house here in a year or two. Yeah. And the other thing I would do, Jeff,

which may hurt right now because it's free money, is pausing your investing until you have this emergency fund in place. That's right. It's going to speed that up, number one, but it'll also put a fire under your belly to really get some financial foundation under you and get back to investing into the match. And I want you investing beyond that because investing 4%, you may not have a great retirement if that's all you do for the rest of your life is treading water. Yep.

Oh, for sure. Is there a way to get Dave's list of good mutual funds, the long-term growth ones that he talks about? Is that on the website? Well, we just split them up into four categories. We don't actually list any specific funds because it's so dependent on your investment vehicle, which firm and brokerage you're investing with. But we've got that resource. You can go to ramsaysolutions.com slash investing. We've got a whole investing hub over there to help you out with that. But Jeff, the real key is there's no life hack here. It's spend less, make more. That's how you find that margin. And I know it's tough for our Canadian listeners. We feel for you guys. We've heard how insane it is over there. And we hope you get some respite soon from the

chaos and craziness. This is The Ramsey Show. So, George, I don't know if you've been having the Christmas discussion in your house. You got a new baby. Oh, yeah. So I'm sure the first Christmas is going to be a special one. Mia's list is very long. Is it very long? Even for a two-month-old, she's just like her mother. She likes nice stuff. I know, and we all do. I know we've been talking

to our kids about it and always trying to temper the expectations because that contentment piece of teaching your kids about this stuff is really important because even people listening that are on Baby Steps 2 and 3 are getting out of debt. Maybe you're saving up for your emergency fund, and it's going to be a season of sacrifice, and we're right in the middle of the holidays. And so that means the holidays may look a little bit different this year. But the good news is, is that the gifts that you do give

can actually bring a lot of meaning. So I have a new kids book out. It just launched yesterday. I'm glad for what I have. And it does, it talks all about contentment, that our stuff is okay. But you journey along with these animals, these little animals in the book to learn that yes, the more stuff you have does not equal

happiness, and that contentment piece is so crucial. So make sure to check that out. Another great option for Christmas is, George, you can actually pre-order George's book. Yeah, Breaking Free from Broke. You won't have it in your hands this Christmas. Not quite. Because it launches in january very exciting uh but you do such a great job tackling all the myths so make sure to check

that out at ramsey solutions.com store and we have a 12 sale going on for christmas with books like the total money makeover baby steps millionaires own your past change your future love your life not theirs a lot of the books that we've all written are in that sale so make sure to check that out because uh again, the holidays are coming. If you're going to give a gift, give a gift that actually can help people. And a lot of people find the Ramsey plan and the baby steps through a gift. They're like, oh, well, my parents gave me this book for Christmas or my friend always had it and they lent it to me and gave me that book. So you actually can help spread

this message of hope when it comes to our money. So go to RamseySolutions.com again slash store to check out the $12 sale. And what's cool is that when you go to RamseySolutions.com slash store, you'll also see the Ramsey Cash Giveaway

we have going on. That's right. $500 weekly prizes, a $5,000 grand prize you can enter every day for your chance to win. We're just spreading the cheer in the RamseySolutions.com store.

Merry Christmas. We're having a good time out here. I'm ready for it. Are you a Christmas person? Yeah, jump Thanksgiving. I mean, I know we need to be grateful and stuff, but I could— We do kind of skip it. We already have Christmas up.

I know. The Thanksgiving decorations didn't make the cut this year. This weekend is our Christmas decorating. I can't wait. I love it. Well, let's get to the calls. Dustin is up next in Charleston, West Virginia. What's going on, man? Hey, guys. Thanks for taking my call. Sure. My wife and I, we feel that we make too much money

to have to, you know, each month worry that are we putting enough in savings? Are we doing the right thing with our money? The interest rates have went back on student loans. We never had student loans prior to COVID. And then post-COVID, you know, we probably weren't aggressive enough paying off student loans with interest off. We probably did things with that money that we shouldn't have done. But maybe get a little guidance on how to tackle student loans the best and are we maybe saving enough uh and budgeting doing our budget right okay yeah so how much student loan debt do

you guys have uh she has 203 000 right now what's her degree in uh anesthesia good okay and is she how much is she making a year uh combine we gross about 340. Combine 340 okay so that's the student loans and then any other debt how much do y'all owe on the cars uh we have newer vehicles and we have we also have two mortgages we have a mortgage on our house and we have the farm mortgage land mortgage separate uh we rent um an old mobile home on the farm that covers that payment though okay so how much and the cars how much debt is on them they're the one they're both a little over 50,000 we have one 50,000 each okay each yeah and then how much and then any other consumer debt besides the mortgage?

No. We got mortgage vehicles, student loans. Okay. Yeah. I mean, yeah. And I, I mean, I can, I, with these numbers, I'm like, yeah, you, you owe as much as you make a year. So it is going to feel, it's going to feel tight. Is, um, do you guys have any savings? Uh, we probably got 25 right now. We've just, you know, like I said, we weren't as responsible maybe as we should have been when interest rates were off the student loans. We, you know, spent a hundred thousand building a new barn. Right. Just doing whatever you want. And now every month you're committed to paying that and you're thinking maybe I should have been more responsible for the past two years. Totally. So how much should we think about having in savings? Should we go a different route on foot less investing?

Are you doing any investing right now? We both max out 401s. Okay. Well, that's going to free up a whole bunch of money if we pause that temporarily, wouldn't it? Yeah, but should we do that? If I had $300,000 in consumer debt, I would definitely pause investing. And here's the reason, because I know you're going, listen, you guys are smart people. You're really good at math. The truth is making $340,000, you guys should retire multi, multi, multi, multi millionaires.

The problem is there's a lot of people just like you out there who don't retire with that because they think, well, I'm just going to hang on to this debt. I'm not, I'm kind of comfortable. We're just doing a bunch of things at once, but we're not really making any progress. So I think you guys could crush this $300,000 in debt in two years. Less than. That would be, yeah, that would be good it's just you know so maybe pause what we're putting in in retirement yeah i would pause all investing dustin i would take your twenty five thousand dollars in savings and this is gonna make you feel real uncomfortable i would take it down to a thousand and i would throw twenty four thousand at at this debt. And if I were you, Dustin, I'm like,

$100,000 in cars, even though your income can somewhat justify it, we don't want it more than half of your annual income, so it technically could justify it. But almost for the act of it, I would get rid of them. How much do you think you could sell them for? We could probably clear 10 on each.

So you'd make 20 grand total? Yeah. And use that, you could buy a used car for 10 grand to putz around in for now? Yeah. And then, you know, like our family, my wife's family, I guess, you know, they got used. So you look at that, and my wife, they're always working on those cars. So what is, how much is the benefit? Well, a reliable used car

yes yeah they're so expensive nowadays that's you know that's the i think that's yeah you purchased a really expensive car so you definitely know but man you make 320 grand find a 10 12 000 honda civic that's going to get you guys around for a year i'm not selling to live to drive it for 10 years but be driving it for for a year dustin i'm like because what you guys around for a year i'm not selling to live to drive it for 10 years but be driving it for for a year dustin i'm like because what you guys need there's there's a radical mindset shift that that needs to happen for you guys you've been doing your plan and it's not working you make 350 000 and i'm not trying to come down on you too hard dustin but there's people listening right now that think holy crap rachel's being nice they're angry at Dustin going oh my

gosh I could be doing so much with that income and they're still feeling stressed like this is crazy so there needs to be a there needs to be a radical shake-up Dustin you guys you and your wife need to sit down and feel like we we've done this all wrong like we have to do the complete opposite of what we've been doing which means selling stuff yes buying a twelve thousand dollar car i mean doing things that are so different than what you guys have been doing tackling this debt getting savings because if i told you dustin that gosh i mean we could sit here and run the numbers but i'm like i mean within within nine months if you guys sold these cars and took your income and paused investing through everything at

it you could look up by next summer be almost debt free and then you guys could even look up and say oh my gosh you know we could we're gonna have savings with that income having no payments no payments how much you're gonna be able to save a three to six months worth of expenses for an emergency fund have that in place and then start investing. Your whole financial world, Dustin, could look completely different in 18 months, completely different. But that means you guys are going to have to do some really different stuff. And I would encourage you, I want you to stay on the line, Dustin, because I want to give you financial peace, university. This is our nine lesson course that I want you and your wife to sit down and go through. This is the basics of money.

And it is the fastest way to build wealth from point A to point B that's sustainable. And man, I just, I'm so hopeful. And you guys live in Charleston, West Virginia. You're not out in LA, California with insane lifestyle. Yeah, making that kind of money. Yeah, I mean, like you guys can do this. Like you have so much going for you. You have so much going for you, but you have to have the discipline.

You have to look at money in a completely different way, and it's going to be uncomfortable, but I think that's good, Dustin, because you guys have been real comfortable for a while until it's caught up with you, so continue that. But man, $350,000 a year can do a lot for you guys, and it's only working for the bank right now.

You'll get there fast, man, if you follow this plan. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Campbell, joined by Rachel Cruz. This is your show. So give us a call at 888-825-5225. We'll talk about your life, your money. We will give you our unfiltered opinion. And Rachel's a lot nicer than I am, naturally. She's just a sweetheart, and I tend to be... What about that last call? I tend to be abrasive.

You were nicer. Well, some people deserve a hug, and some people, you know, need a swift kick. But generally, our callers, I give them hugs, Rachel, what we're here for. And I think that will be the case with our friend Deanna, who's in Atlanta. What's going on, Deanna? Hi, how you doing? We're doing well. How can we help today? I am a single mom of one. I live with my family and I make $53,000 temporarily from home, but I have a 12-year-old felony. So sometimes I cannot pass background checks for the jobs that I want. So I'm not sure what to do at this point. Like, should I still try to go to school or still try to become an entrepreneur

or like, I'm just stuck. What are you doing right now for work? I am a fraud case manager. Okay. And you said it's temporary? Yes. It's a contract. contract okay would you want to do that full time yes i love what i do okay is there more opportunity for it yes there are more opportunities um i just i failed one opportunity with a big four company because of my background though so i don't know tell me again why you're not passing the background check i missed missed that. Because I have a 12-year-old felony. Oh, okay, 12-year-old felony. That's still on your record. Does that fall off at a certain point?

What is the plan to kind of circumvent that going forward? I'm not sure. It's a lot of money to try to get it removed. Okay. And then you're saying should you go to school, what would school do for you? What would be the goal with that? I don't have a degree. So I feel like I would beat the competition as far as having a degree in maybe computer science or accounting. That's all I

know is like accounting and office administrative. Okay. Well, there's a lot of paths. I don't know that a degree is what would make you stand out. I mean, someone's paying you $53,000 a year right now without a degree, which tells me you have skills and experience. Yeah. Because I mean, honestly, Danny, there will be some career paths that will require a degree for sure. Accounting, you know, things like that. But yeah, they're going to probably want to see that. But there's a whole other world out there that don't require college degrees and you can still make a great living doing it. So if I were you, how old are you? I'm 34. 34. Okay. And how old, how old you're, do you have a son, daughter? I have a son who's four. Who four okay so great um yeah so i mean if if i were in your shoes i wouldn't necessarily be looking to go back to school i would probably be looking for the next

gig right that's uh in the same context of what you're working in now because you have a great experience and that's going to take you really far and then if there are options that you're like yes maybe i do want to go back to school here in the future. We don't want you taking on debt for it. But I would look to see, you know, if there's community college to get some of your prereqs there, some online classes. I mean, there's ways to do it if you want to slowly and with cash. But I just don't want you to believe that you can't make a great living without a college degree because you can. And we talked to a lot of people on this show that do it. And so I believe in you enough.

I mean, you have a very great job right now. Mike, you're very smart to be able to do what you're doing. And so I would look to see what those skills are and what you enjoy and see if there's a path. Because in a perfect world, you know, you would save 60 grand or whatever it is to get a degree and save that money and be working instead of that. So it's just the ROI on it. Do you have any debt right now, Deanna?

Yes, I have $40,000 in debt just because of my car and, you know, $3,000 in credit cards. But I plan on paying the credit cards down just to improve my credit, but I do have an expensive car. Okay, what's the car worth? I haven't got it appraised yet. Okay, what do you owe on it? I owe roughly $38,000 on it.

Okay. I would Kelly Blue Book it when you get off the call with us. If you can get what you put into it without being underwater, I'd get rid of that car and drive something cheap for now. Do you have any money saved? Yes, I have $2,000 saved. Good for you. Good start.

So here's your game plan for the next few months because you're living with family, so you don't have any bills, right? No. No big bills. So what if we could use that wonderful $53,000 salary and we start throwing $1,000, $2,000 a month into that savings account? And once you have a nice chunk of change in there to buy a used car, we can sell that car, hopefully for what it's worth or even more. And that way you can get out from under this thing, leaving you with, you know, you'll be knocking out these credit cards real soon, right? So now you're debt free making 53 grand. Yeah. What's your car payment a month? $740. Yeah. So if you could imagine that just being back in your pocket, right? I mean, there's, yeah, because your because your car payment diana is very high compared to

your income so i would say it's pretty much a requirement i would sell the car so i would do that as soon as you get some money saved to buy a cheap used car to get you where you need to go it's not gonna be a pretty car it's not gonna be the car you're driving now uh but it will relieve so much of that pressure and if you'll hold on the line diana i want to give you a copy of my new kids book i'm glad for what i have because as you're on this journey of figuring out your money and possibly selling your car, and you're going to be working to pay off this credit card debt, and you're in a big transition. And I think it's just a great conversation to be had with your son. And girl, I just think that there's so much ahead of you. I think you're

doing a really, really good job. Thank you. Thank you. Oh, hey, Deanna, we're pulling for you. Hang on the line. We'll send you Rachel's new kid's book. And man, a single mom alone is a warrior. Yes. But one that has that kind of background that has overcome so much and that is doing so well. I'm just so proud of you. And I have full faith that someone is going to hire you without a degree because Deanna is the secret sauce, not the piece of paper that says Deanna did some schoolwork. So we believe in you. David is up next in Gainesville, Florida. David, what's going on? Hi, how are you? We're doing well. How can we help today? Well, I have, I'm embarrassed. I have messed my finances up pretty

much my whole life. I'm 59 years old and want to take better care of my wife, who has been, had to quit her job. We don't have her income anymore. She has a permanent brain injury from a concussion. I'm sorry. She has Crohn's disease. Oh. And she's just been diagnosed with some cancer. Oh, David, I'm so sorry. Sorry. No, no, you're fine. I've been a kid.

I've been an adolescent my whole life. I've been well worth money. And now an adolescent my whole life. I've not been well worth money. And now she's suffering for it. We don't have a lot of debt. I do make decent money, and I just don't know where it goes. Yep. How much are you making a year? This year is my worst year.

It's only going to be about $62,000, and it's because of many, many doctor's appointments. She can't go alone. She can't do these things alone. We have nobody to help us, so I have to take off work to do it, and thankfully, I work for an excellent company. Good. And how much debt do you guys have? We have about $26,000 in medical. Good. And how much debt do you guys have? We have about $26,000 in medical.

Okay. Small credit card debt of about $2,600. And a few tiny purchases of some household items, probably totaling $2,000. Okay. That's it's it. But I don't know where my money goes. Well, we're going to help you, David. We're going to take a short break, but I want to carry this over because there's a lot to unpack here, and I want to make sure that we serve you well, especially while you're going through such a difficult time. And before we go to the break, I want to let you know that you can release the

shame and the guilt and the baggage we've all made mistakes man that makes you over 12 years old the the big thing is what are we going to do now what does 60 year old david want to be 65 year old david what does the next right step look like as we take care of your ailing wife and we're going to walk you through that right after the break so please hang on line, David, and we'll be back with you in just a moment. Welcome back to The Ramsey Show. I'm George Campbell, joined by Rachel Cruz. Before the break, we were talking to David in Gainesville, and we still have him on the line. Let me recap his situation. His wife has been through it health-wise, can no longer work, is dealing with a cancer diagnosis, and he makes 62. They've got $26,000 in medical debt, $2,600 on credit cards, some other little debts hanging around, and we just want to wrap our arms around him and see what we can do to help him take the

right next step. David, are you still with us? Yes, sir. Was that a fair recap? Yes, sir. Okay, wonderful. Well, welcome back. So let's walk through some of the numbers and get you kind of a game plan moving forward. So you're 59 years old. How old's your wife? 56. Okay. And you are now the sole income for the family and you're trying to take care of her, and so having to take time off of work to do that, which is also limiting some of your income, correct? Yes, sir. Okay. And you do have some money in savings?

No, absolutely none. None. So we're paycheck to paycheck right now. Yes. Are you able to cover your bills? Are you current on all bills? Two credit cards are in collections. Okay.

And what about your, are we able to put food on the table, cover the renter mortgage, cover the utility bills? That's one of the embarrassing things. I can put food on the table. We have no rent. I drive a truck for a living and we live in the truck. You live in the truck? Yes, sir. What kind of truck is this? Is it a livable situation? It's a semi. It's a eight by eight box. How long have you guys been doing that, David? Five years. Four years, excuse me, four years. is that um purely a finance because you don't have

the margin to pay a rent or a mortgage or is that because you guys are on the move all the time and it's like what you decided just to do some bad places that i work we made a move to florida um and we have a fifth wheel trailer that is in a in an area that we stay in on the weekends, but there's no rent there. It's the company that I work for that lets me keep it there. Okay. Do you think it would be prudent to find a more stable living situation for her? If we just found a cheap place to rent? We would love to, but I've got the finances so messed up that I'm not saying I can't afford it. I just don't know where it goes. I don't know why we don't have it. So you make $62,000. What is your monthly take-home pay?

Monthly take-home, see, it varies, and a lot of that's because the doctor's appointments if this was an normal year it would be around um around five grand a month okay so you're making closer to that's a good year though so these days is it closer to three grand a month? I don't know. That's where we're having trouble, too. We don't understand because if one week we've had two doctor's appointments, I miss out on so many loads that my paycheck is like $500 when it's normally take home $1,300, $1,400. And, David, for these doctor's appointments, because you're having to miss work, is she able to drive herself or is it that she actually needs you to, she can't physically drive? She's no longer able to drive.

She can't stand very long. Gets dizzy. She just can't be alone. Yep. And you guys have no family. Where is your family right now? Do you guys have any? Closest family would be my father in Illinois. He's 90 years old.

Yeah. And we have a 41-year-old daughter in Illinois that... Do you guys have a relationship? Not much help. Okay. Okay. Okay. Because in a perfect scenario, David, what I would want for you guys is a place to live,

especially going through all the medical stuff. So you keep saying, yeah, we don't know where it's going. We don't know where it's going. And we hear that all the time, right? That's not just you. A lot of people feel that way because there's not an intentional act of where this paycheck is going. So I would say two things on my end and George can walk you through some more stuff. But we want to gift you every dollar premium and FPU, which is Financial Peace University, our nine lesson course. But that EveryDollar Premium, David, is going to help you guys budget. And you're going to bring your

paycheck in and you're going to say, okay, this is what we're planning on making. We're gonna have to guesstimate, right? Because you may not know exactly, but we think that we can at least make this. Now we're going to plan out to the cent where every single dollar is going. And there's not going to be out to eat. There's not going to be all this. I mean, you guys are, we say rice and beans, beans and rice, like your grocery budget's nothing. Y'all are going to be eating spaghetti and tacos and cheap, I mean, cheap food. You're going to go as cheap as you can on everything. See where that ends up and what margin that is. And then I think a good goal for you guys in the next few months, once you kind of get that in order, then is to be able to find a place to rent.

And again, I don't know where exactly location-wise, but you want to make sure, especially if it's a good month where you guys are, you know, around $1,200 a month probably. So that's going to be, you know one bedroom apartment or just something just to give some level of stability from a living situation point and the second thing david which i know is really difficult but we we have to figure out how to solve this problem is the income and so if we're going to be losing income by taking her to doctor's appointments and stuff what are things at night that maybe three nights a week that you're doing

something? Because the income is one of the harder parts of this formula. And I know the life situation you guys are in, it almost feels impossible. But I think that's going to give you guys some breathing room if you can find extra work either with your current job and taking on more or finding something, a side hustle or something at night. Because again, upping that income is going to be really big. And David, a question on the insurance side and medical bills. Are you able to cover those future bills? Does she have health insurance? We have health insurance. What the medical bills are or what's out of pocket okay we've

so i want to make sure you have the right type of insurance to avoid going another 25 grand into medical debt have you hit your out-of-pocket max yes okay so that's good at least for the rest of the year for this year yes and then it restart. And so we need to start looking at those numbers. I want you to start saving towards that so that we don't go further into debt as we continue to take care of her. So that's one piece of the puzzle is the ongoing medical care is going to continue to rack up on top of getting rid of these other debts. So using your income, what you're going to want to do is lay these all out. The facts are going to help you. Lay out every single little debt from smallest to largest,

and you're going to start attacking the little one with a vengeance. And the credit cards and collections, David, I would get a hold of them and see if you can settle. Because usually if it's within collections and get it in writing, if they will. But tell them your situation. Like, I don't have it. Like, I don't have the money.

And if you scrape together, you know, if you have $2,000 in writing if they will. But you can tell them your situation. Like, I don't have it. Like, I don't have the money. And if you scrape together, you know, if you have $2,000 in these credit card bills. It might take 400 bucks. Yeah, and you scrape together four, five, $600. You know, like I can pay you now. Most of the time we'll settle to the point that it's in collections. And if they do get it in writing,

but I would go down that avenue for sure because you're not being immoral in that. You genuinely don't have the money. I mean, like you don't. And sometimes they'll negotiate with you and you can actually lower that and the same thing will go for this medical debt see if you can settle that negotiate that because you guys truly don't have the money you're living in the truck right now we're trying to take care of her trying to work and so i've i have faith that we're gonna get you out of this situation but it

might be a really difficult year or two to get some financial footing under you so that we're going to get you out of this situation, but it might be a really difficult year or two to get some financial footing under you so that you're able to take care of her and have some breathing room, not just with your time, but with your money. Well, can I say two things real quick? Sure. I know that's going to happen because the Lord has provided very well, and it was like a slap in the head. He said, I've given you what you need.

Now you need the tools. And that's where you guys come in. Oh, David, that's beautiful. Thank you for that. We're going to also, on top of giving you Financial Peace University, on top of Every Dollar Premium, we want to go one more step and give you a free financial coaching session with one of our Ramsey coaches. And so they're going to walk you through this in a way we can't do here on air in a few minutes. But I appreciate the call. One last thing, we're going to give you EveryDollar. I'm going to walk people through how to use EveryDollar in a webinar happening tomorrow, everydollar.com slash budgeting. We'll make sure you get signed up for that and everyone listening can sign up for that as well. Man, we are all pulling for you, David, everyone listening for you and your wonderful wife. This is The Ramsey Show.