The Ramsey Show - App - Don't Go into Debt for a Family Member (Hour 2)

Episode Date: June 7, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host. This is your show at 888-825-5225. Adriana is with us in Norfolk, Virginia. Hi, Adriana. How are you? Hi, Dave. I'm blessed. Good. How can I help? Okay, so to give you the short of it, I'm married. I married my husband back in October, and we took a few for kind of our engagement,

getting ready for everything. We're on the same page. And now we have a baby on the way. Yay! Yeah. We were in baby step two, but we've kind of backslid to baby step one with my prenatal care. Okay. So my question is, before we went to SPU, before we got engaged, we went ring shopping,

and we got some very expensive rings. Now, the thing is, we have other rings that we picked up for everyday use because my husband works in a restaurant. So my question is, should we sell the rings to kind of put back our emergency fund for Baby Step 1? What does your husband make? Right now, he's making about $30,000 a year, but he got a promotion at his job. They told him he would be making about $40,000.

Good. And how much are you making? I'm not actually making anything right now. However, I am looking for some work to do at home, whether it's like if I start Etsy or do like remote data entry or something like that. Okay. How much debt do you have? How much debt? Total, we have $51,000.

On what? We have, what's that? On what? Credit cards is $11,000, and that's actually some of the rent debt as well. Personal loans, we have $8,500, and for student loans, it's $31,500. No car debt? Um, that is probably personal loans. The $8,000.

I think he owns $700 on it. On his car? Yes. Okay. But your car is paid for? Yes. What is his car worth? I have a Beater BMW.

I'm very proud of it. You have a what? I have a Beater BMW, and I'm very proud of it. A Beater BMW. Okay. And what is his car worth? That I really don't know. I think he told me he got it for around $10,000.

Okay. $10,000. All right. And your rings, you paid $11,000 for them? No, it's part of the credit card. Oh, what did you pay And your rings, you paid $11,000 for them? No, it's part of the credit card. Oh, what did you pay for your rings? When we got them, it was $6,000. We have $5,000 left over on it.

Mm-hmm. Okay. And when you sell them, you'll sell them for $1,500? Probably. Yeah. No, keep them. Okay. No. probably yeah no keep them okay no you've got all kinds of other issues but the rings are not your issue um they don't if they were 15 000 in this situation i might think about it with a 40 000 income and a wife pregnant at home and 51 000 in debt i might think about it but they're

not 15 000 they're not $15,000. They're $1,500 probably when you turn around and try to sell them back or sell them in some way. So, no, I think I'm going to keep them. But I think you guys are going to continue to just really lean in on your budget, and he's going to be working a lot. Anything he can do, not only in his main job, but anything he can do to pick up extra income

and anything you can do to pick up some income, as you you said from home while you're in this prenatal situation and um now i think if you guys will be really really tight on your budget watch what you're doing be very very careful i'd put the student loans in hardship deferral right now and let's get some headway on some of these other things and get them cleaned up as quickly as you can. And then you guys just continue to lean on this and lean on it as hard as you can. But I think you're going to be okay. You're going to work your way through it. Baby comes, you're back to work.

You know, your income doubles again. I think you're going to be heading in the right way that time. So, hey, thanks for the call. We appreciate you joining us. Open phones at 888-825-5225. Thank you for being with us, America. Brian is in Winter Haven, Florida. Hi, Brian.

How are you? Hi, good afternoon, Mr. Ramsey. How are you doing, sir? Better than I deserve. What's up? Well, sir, my wife and I have been on our debt-free journey since December. And might I say our marriage has always been great, but it's just been much better with our communication and everything going on.

But essentially, long story short, we started with $105,000 in the consumer debt, and now we're down to $44,000. Our goal is to be done with this at the end of next year. We just want to know if you agree. What's your income? Well, we currently make $115,000. Okay, and you're going to pay off how much by the end of next year? So 18 months, is that what we're thinking?

Yes, sir. Okay, and you're... And might I say, sir, that the last six months, a lot of the heavy lifting has been done. I sold my car so that we were able to eliminate $11,000 immediately, and we were able to receive a $17,000 student loan forgiveness. Right. And you've got, that's wonderful. Okay, so you've got $60,000 remaining.

Is that what you said? No, sir, $44,000. $44,000. Oh, yeah, you can do that in 18 months, making 110. Okay, perfect. Definitely. That's very doable. Yeah, you're on track, man.

You're killing it. Yeah. And you're so spot on. I mean, you know exactly where every dollar is and where it's going, and just very well handled, man. I love it. That is just excellent. Great job.

Thanks for calling in. Open phones at 888-825-5225. Amanda is on our private Facebook page community that you can join if you'd like. We'd love to have you guys out there. It's called The, because it's the official, The Ramsey Baby Steps Facebook Community. And so if you want to be on the Facebook community with us, our team is on there, and bazillions of you are on there. The Ramsey Baby Steps Facebook community.

How do I do this if my spouse is not on board? He says he is. He says he wants to pay off our debt and save money, but his actions say differently. So is it possible to do when he isn't supportive or on board? Kiddo, if you start running off every time you and your husband aren't in agreement and running into a china shop and being the bull by yourself, you're never going to have a good marriage. You guys have got to learn to work together.

Can you do it by yourself and get out of debt? Maybe, maybe. But it's probably going to do a lot of damage to your relationship you're already pretty disgusted with him just by your wording and so where i would tell you to concentrate is on your relationship and on him hearing you very clearly with the tv off and the kids in bed and no noise or background saying, this is very important to me. You actually doing this, not just saying you're going to, would be an act of love towards me that would be a very big deal to me.

He hasn't heard that yet. When he hears that, he'll come along. This is The Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major health care costs. Christian Health Care Ministries is the original health cost-sharing ministry. A Better Business Bureau-accredited organization, CHM members share to pay each other's medical bills.

It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thomas is with us in Charlotte, North Carolina. Hi, Thomas. How are you? Hey, good, Dave. How are you? Better than I deserve. What's up?

So I have a question. I'm 27 years old, out of school, been working on your program to get out of my student loan and car debt and everything. I'm currently making about $80,000, have about $45,000 left in student loans and car combined. I had a question about some things I've been watching on YouTube and about buying a house. And you always say get out of debt first.

But I have a question. If I'm a single male and I was able to buy a house and then have two tenants live with me to basically pay the mortgage and maybe a little bit sum in case, do you think that would be wise to... No. Okay. No, I would not buy a house until you're out of debt and you have your emergency fund in place because here's the thing i've got a bunch of tenants and i've had a bunch of tenants i've been in real estate business just about my whole life and tenants don't always pay and sometimes tenants tear up stuff and sometimes there's legal costs involved and um then you've got a mess on your hands and this idea of yours that was supposed to help you in your get-out-of-debt plan instead becomes a problem and hurts you.

And if you're broke and you need the money, you will put stuff off of tenants you shouldn't put up with. Right. Yeah, you're kind of cornered. You need the money, you know, and so instead we're very, very kind to our tenants, and we're the best landlord they've ever had because the property is in the best possible condition. But also we own the house. They don't, and so the relationship is real clear there.

They pay. They get to stay, and it's not a mean thing. It's just that's our business arrangement that we've entered into, and there's zero desperation financially on my part on dealing with them. If I needed to extend someone some grace because I wanted to in some situations, I can, but most of the time that's not the situation with a tenant, and the vast majority of the time, as a matter of fact. So, no, I would not tell you to get into debt, own a house,

and not be able to pay the payments unless the tenants paid you, or you'd have a big expense if they didn't pay you. It puts you in a really awkward, bad place. I would not do it. I would not buy a house until you're debt-free and you have your emergency fund in place, and then you, beyond that, you save your down payment. So you're on your way. You make good money.

You're only 27. You're going to get a house, and I want you to get a house. George is with us in San Antonio. Hi, George. How are you? I'm great. Thank you for taking my call. Sure, man.

What's up? Well, I purchased back in 2014 a 2014 Dodge Journey. And a couple years later, I purchased a Dodge or whatever they call it. Anyway, the Dodge extended warranty. And for a lifetime extended warranty, the ticket price was $3,785. I put $500 down. I've been paying $136 a month for about nine months. So I've got about $1,600 into it. If I cancel now, I'll get about $700 of what I paid in back.

But then I won't have to pay the other $2,100. I started getting second thoughts about this a while back, and I just thought I'd check with you before I dropped it. I'd drop it. Here's all the data on the extended warranty business, especially in the car business. The actual probability of an event occurring is covered by about 12% of what you're doing, meaning that if they cover 1,000 cars just like yours, on average 12% of what you're paying for this would fix the car.

The rest of it is profit and commissions and marketing fees and other stuff that they've done to get you to buy it in the first place, all that kind of stuff. And so it's a very, very, very profitable business for the extended warranty companies. Have you ever bought something at Best Buy? Yeah. Yeah, when you go into Best Buy, I mean,

they ask you if you want an extended warranty if you buy a pencil. Yeah. And the reason is they make more money on credit cards I mean, they ask you if you want an extended warranty if you buy a pencil. And the reason is they make more money on credit cards and on extended warranty than they do their electronic sales and the sales of their items. They have the sale of items there just to get the opportunity to sell credit and extended warranties because that's where they make all their money. Their real profit centers are not the actual sale of a television. And consequently, the buy on a television is a pretty good buy at Best Buy.

There's not much margin in it. They don't make much money on that. They make their money when they can jack you up and put you on payments or jack you up and put you on an extended warranty. But out of $100, $12 goes to cover the actual event of the thing breaking on average across the scope of 1,000 of them. And the rest of it goes to profit overhead penalty, I mean, profit overhead commissions and so forth. So all of that to say, you know, 12% of what you've done, which would be 500 bucks or so, you could cut self-insure through what is covered on average.

Now, that's on average across 1,000 cars just like yours. So if your car has a $2,000 repair, then that messes up their average, and you come out ahead. But on average, you lose money. You have to lose money on average on an extended warranty. Otherwise, they wouldn't be in the business. They would lose money you have to lose money on average on an extended warranty otherwise they wouldn't be in the business they would lose money if you don't lose money by definition mathematically they're losing money and they wouldn't be in the business it's that simple a transaction in your mind so i would drop it all of that's all that's say i drop it i don't buy extended warranties of

any kind any time ever i self-insure through all of those kinds of things. So good question. John is with us. John is in North Carolina. Hi, John. How are you? I'm doing well, Dave. Great to talk to you.

You too, sir. What's up? So I'm hoping you can help to demystify something about a health savings account. My employer offers three health plans. One's an exclusive provider network, which is most expensive. Then they have the PPO, which is what we've always done. And then this past year, they added a high deductible plan with an HSA. What I'm not understanding is, the way they've structured it in my company, at least, is the premium in terms of what comes out of my paycheck is exactly the same for the high deductible plan as it is for the way they've structured it in my company at least, is the premium in terms of what comes out of my paycheck is exactly the same for the high deductible plan as it is for

the PPO. That doesn't make much sense. Yeah, well, the company does give us $1,000 towards getting the HSA started, and supposedly that's going to be a continuing thing year after year. But I'm just wondering if there's any other benefit that might make the high deductible plan make sense for me, given the premium cost is the same. Not really. Usually it's cheaper.

I've got a PPO here, and we've got HSA here both. And our HSA is considerably cheaper than the PPO. And because one's a $250 or a $500 deductible, and the other's a $5,000 deductible or whatever. Right? I mean, how much is your deductible on your HSA? I believe it's actually about $6,000. Yeah. It's close to the annual contribution limit.

Exactly. Exactly. And so, you know, and then they give you $1,000 to offset that. And if you have an event that's $2,000, you have now lost money, you know, out of pocket in that calendar year. So usually the HSA is where you are taking on more of the risk. That is the higher deductible. But in return, you have a cheaper premium.

And so if you're a young family, a healthy family, the Ramseys have, knock on wood, always been healthy as a horse. We've not had major medical events ongoing in our family. And so I've always made really good money having an HSA myself because we almost never use health insurance. I mean, almost never, knock on wood. And so over the years, the savings on premium has been the net result. Plus, I could fund the HSA, which is a tax-deductible savings account, to be used for health needs only. And that silly thing is up to over $200,000 now for me because I've done it for many, many years since it first came out. But in your case, if the PPO is the same price and the deductible, what is your deductible on the PPO?

About $500,000, I think. I mean, I would take that, personally. It's the same stinking price. I mean, it's a $500 deductible or a $6,000 deductible for the same price. I mean, unless there's something I'm missing here in their coverages, you may want to sit down with HR and go, is there coverages or something that the HSA has? I wouldn't do it.

But I'm a huge proponent of the HSA. But what you're describing is very unusual. Usually it's 20, 25% cheaper to do an HSA than it is a PPO. And it should be that. That savings is worth taking the risk for over time if your family's healthy. We'll be right back. Hannah is in Morgantown, West Virginia. Hi, Hannah. How are you? I'm doing great. How are you, Dave? Better than I deserve. What's up?

So, I just graduated from college, and I'm looking at moving now for my job in farm management. The problem is we're having a really, really hard time finding housing. Everything is either really expensive or really cheap and not safe. And so we have a couple of options. We're not really sure what to do. Even my parents are a little stumped, so they recommended, you know, call you. The first option is to go ahead and take the expensive housing, move up there with my family, have us all there, do that for a year. already living kind of beans and rice, and I'm scared that it's going to make us beans or rice

and really stretch everything and really mess up our plans to get out of debt. The second option, which can kind of go two different ways, is to move up there on my own. The farm does have housing for employees. My daughter and my husband would move in with my parents um for a short time um while we saved up some money um and either had what does this job pay um right now it pays about 34 um and then 34 000 yeah um it's a trainee program um oh the year after that it goes up to 40 and then when i get my own farm which will be the year after that it goes up to 60. this is a lot of gyration for a 60 000 job um what does your husband do for a living um right now he is running his own business in

graphic design um he just got it started um it's not making a lot um what he would do is move up um and get something steady um either working at a bank where is up Where are you talking about moving to? Chambersburg, Pennsylvania area. Okay. And what major metro area is that closest to? An hour away from Lake Hagerstown, Maryland, 30 minutes north of Gettysburg. Okay. Not that far from where you are now then. Okay.

Yes, that's two hours away. Yeah. And there's a housing shortage just because it's a rural community? Not that far from where you are now, then. Okay. Yes, that's two hours away. Yeah. And there's a housing shortage just because it's a rural community? Everyone owns their houses up there. Well, because, I mean, it's not a large community is what it amounts to. Because when you make a statement like everyone owns their houses, if that's a town of five people, that's possible.

If it's a town of 500, that's bull. If it's a town of 50,000, it's absolute bull. Okay? So everyone doesn't do anything. So, you know, what size community is this population? It's currently about the same size as Morgantown, so probably about 50,000 or so because it's also got a college in the area. And that's what's taking up most of the housing. And driving up the cost.

It might be driving up the cost somewhat. When you're making $34,000 a year, it'd drive up the cost, yeah. And how much debt do you guys have? We currently, with everything, I think we're sitting at about $70,000. And you've got a four-year degree in farm management? In animal science. Animal science, okay. With the intent of running a farm.

That's been your dream. With the intent of running a farm, doing production, or moving into nutrition, which this company will allow me to do as well. Okay. All right. I think you're going to move, and I think you're going to move your family with you, and I think it's going to slow down your debt snowball. Okay. And you're going to slow down your debt snowball and you're gonna and you're gonna just rent something and um uh and i think you've got some more hunting to do to find a good rental and you may have a little bit of a drive you may need to you know get far enough away that the college students wouldn't want to rent that and so you

have a whole 30 minute commute or something like that that. That wouldn't kill you. So the farm is actually 30 minutes away from that area. Well, then there's other stuff 30 minutes away from that farm in another direction too. So I think you're just, you know, your house hunt is just beginning. It's not over. And so, you know, you just can't get into these absolute statements like everyone owns their own home. There are no properties except high end and low end. And not in the community of 50,000 people. That's just simply not true.

Now, maybe you haven't found it yet, but, you know, you're setting yourself up to make bad decisions when you box yourself in with statements like that. So just say, we just hadn't found the deal we need yet. That's the way you need to say it, because that's the truth. And you just need to keep looking until you find the deal that you need. Or maybe this is God telling you, you don't take this job. You really are doing double backflips for a $34,000 job, really. I mean, that's, you know, it's not like they're offering you $134,000. I might get a little more excited about that, you know.

But, you know, it is what you want to do, and it's what you're trained to do. And if it's a career track that takes you where you want to go, I don't mind you going and doing it. But, you know, it wouldn't also hurt to continue to shop the job market and see where else you can land. Jessica is with us in Phoenix, Arizona. Hi, Jessica. How are you? I'm doing well. Thanks for taking my call, Dave.

Sure. What's up? So we have a, my sister-in-law is going to graduate from Navy basic training in October, and we explained to her that we don't have the money to go, but we're willing to, you know, celebrate with her in some other way when she comes back on leave. And my husband's parents offered to pay for us to go. But we know that in order for them to pay for us to go, they're not real good with their finances and they're planning on putting the whole trip on credit. And we, in good conscience, can't allow them to do that.

So we just don't know how to tell them in a nice way, you know, thanks but no. And we don't want to bring up their finances in the conversation either because that's not really our responsibility. Okay. Well, number one, there's no we in this. Your husband's going to do this because otherwise you're going to be the wicked witch of the west he's going to tell his mommy that um that they're not you know what's going on and i mean all you can do is just be as kind as possible you still run the risk of someone being upset okay

and there's nothing you can do to guarantee how someone else is going to react that's on them they have to decide that but if it were happening at our house, we would just say something like, Mom and Dad, we just can't make this trip. We know you guys are going to put this on a credit card, and we just don't want you to go into debt for us, and we don't want to go into debt for us. And so this is just one we're going to miss.

I mean, it's graduation from basic. It's a big deal. We hate to miss it. Our hearts are there. Our hearts are broken. But we're just not in a financial condition. And, you know, there's no possible way we want you to do anything for us that's going to put you into debt.

And I just can't do that to you. And so we can't go. And then, well, you don't have the right to tell me i i've got a right to tell me and me says me isn't going and that's the only thing i can control is me you guys got to do what you got to do but i i'm not i know that this is going to put you further in debt and i can't do that i can't do that any more than i can do that to our family and put us in that mom and so we're not going to do it we love y'all we love her we're going to back everybody high fives to everybody there'll be another day there'll be another celebration when once we've

gotten our financial act together and we get ourselves out of debt and we're you know we got a little money we will participate in all these things and maybe we'll pay for you to go to something next time because we'll have the actual money to do it. But for this time, this one's a no-go. And they may choose to be mad, but that's their choice, not yours. And you don't even need to be on the phone call, kiddo. Nor in the background voicing your opinion over his shoulder.

You're not going to come out of this unscathed if you do. Just let him handle his mommy. That's the only shot he's got. And that may or may not happen, but it won't be your fault then. And that's the only thing I can tell you. It's what I would do. I'm not a family therapist. I'm just an old man that's done a lot of stuff.

This is the Dave Ramsey Show. you know running your own business is it rewarding, but it's a lot of work. It's a lot of work. And, you know, and on top of that, you've got to fool your taxes. So let me ask you this. Are your taxes causing you to enter a crazy cycle, like, you know, like you're stressed out, crazy? You know what I'm talking about? I hate taxes, and I hate doing taxes. So long ago, I decided I'm going to delegate that.

I'm going to get a tax professional and handle my taxes. By choosing to have a pro handle your taxes, you're choosing to take back about six weeks of your valuable time to actually run your business. That's how much just keeping up with this stuff is. You can make next tax season a breeze. Get one of our tax-endorsed local providers to help you grow your business and get everything in a zone where you don't have anything

except a rhythm with your taxes instead of crazy land with your taxes. Yeah, just go to DaveRamsey.com slash ELP, and then you'll see the ELPs, the endorsed local providers for tax preparation. They can really help you if you're running a small business. Casey's with us in Miami. Hi, Casey. How are you? Hello, Mr. Ramsey.

How are you doing today? Better than I deserve. What's up? So recently, me and my fiance, we started listening to your show and started following some of the advice that you've given us to help better our debt and better our credit. And one thing that I noticed was there was one big debt on my credit report that was bigger than the rest by multiples. I've got a $16,000 medical debt that's from four years ago. And so I figured I'd start, you know, doing a little digging on this, asking for validation, et cetera, et cetera. And I come to find out yesterday from the original creditor that the information in the file was wrong on the original debt. So with this information, do I have a standing to go to the collector and fight this, or how does that work now that I know that it's not the correct information?

What's incorrect? The social security number on it, sir. Was it you? Yeah, yeah. Okay, so how did they get the wrong social security number on the file if the date is really yours? I'm not sure, sir. Maybe they entered it wrong when it first happened. Maybe there was a miscommunication. How did you find that out? I called the hospital yesterday, and I basically asked for the dates of when the medical bill was processed, when everything was sent to collections, et cetera, et cetera.

And they tried to search up my social security number in their system and couldn't find it. They said, let's try your last name. So I gave them my last name. And they said, oh, that's why in our system under this file, it's a different one so i just didn't know if this was pertinent information or if this was something that i could use or no probably not i mean it doesn't matter you legitimately owe the debt they've just got a clerical error on the social security number that's what you're telling me so it doesn't it doesn't mean you don't owe the debt or anything like that. How long ago was the debt? Four years, sir.

Four years at $16,000. And was $16,000 the original amount? Yes, sir. Yes, sir. Okay. All right. And how much money can you scrape together? I mean, probably between two and four. But I called the collection agency before I found this information out.

This was about a week or so ago. And I asked them if, hey, is there any way we can make a deal on settling? And they were very, they hardballed me very badly. They just straight up said, no, we never settle. Okay. Then you never get any money. Okay. Everybody can play hardball.

I mean, here's the deal. I've got a big pile of debt over here. I'm trying to decide whether to file bankruptcy on all of it or not, and you're the biggest one, actually. And so I'm going to go get rid of all the rest of them, or I'm going to file BK. But if you want $4,000, I have $4,000. I'll give you that as settlement. Now, here's what I would do.

It's very interesting that the hospital even talked to you. Most of the time, they're pretty hardcore once they've handed it over that they won't even have a discussion with you because that keeps people from in running the collection agency. The fact that they discuss this with you is very cool. So what I would do is call that lady. Or who did you talk to? Do you remember who you talked to? It was some kind of billing expert, quote, unquote, at the hospital. I don't remember a name.

Perfect. Well, call over there and try to just connect back up with that person and say, now you guys have the wrong Social Security on that. Did they correct it that day? No, sir. They were very adamant when I said, well, that's very interesting because obviously that's not supposed to happen. And they said, well, yeah, we're not going to do anything to it because once we give

the follower the collections, we never touch it again. That's what they usually say. So anyway, I would call back over there and see if you can get an appointment to sit down and talk to somebody in person and offer the hospital $4,000. Do you mind if I ask you one more small question, sir? Sure. Another thing that I found very interesting was with this particular debt, I was never contacted about it. It's been four years, and I was never called, emailed, or mailed about it. Is that unordinary to you? Yeah, no, that's normal because they're just incompetent. it it's been four years and i was never called emailed or mailed about it is that is that

unordinary to you yeah no that's normal because they're just incompetent okay they don't care they're incompetent and then when you get them on the phone they're butts and that's what you that's what you got so i would try to sit down the hospital and offer them for i call the collector back and just throw hardball across you know right across his plate as well and go dude you know you're an idiot. If you want $4,000, I've got $4,000. You can have it right now as soon as you give it to me in writing that $4,000 settles this account. You won't get a dime until you get it in writing.

And as soon as you give it to me in writing, I'll wire the money over to you right now. You'll have it today, and this account will be off your books. If you don't work with me, here's what you're going to get. Nothing. Okay. Ever. Okay. We'll sue you.

No, you won't. You're lying. If you're going to sue me, you've already done it. It's been four freaking years. When are you going to sue me, you know? And so you have to talk to these people like they're idiots. Why? Because they're idiots.

It's the only way to deal with it. And they don't understand anything except a board in the face. And so it's just how you have to deal with them. They're scum. It's unbelievable. Hey, yeah, call them and beat the snot out of them and get it settled and get it out of your life. Michelle is with us in Portland, Maine. Hi, Michelle.

How are you? I'm well, thank you. I'm a new listener to your show. I appreciate you taking my call. I'm honored. Thanks for being here. How are you? I'm well, thank you. I'm a new listener to your show. I appreciate you taking my call. I'm honored. Thanks for being here. How can I help? I have a teenager who has a college fund of about $50,000. She recently got a small part-time job, and I'm trying to decide, do we continue to plug away with college funding?

Do we open up a retirement account for her um what are your thoughts well she doesn't need a retirement account if she only has fifty thousand dollars how are you going to pay for the rest of her college potentially potentially right so probably she'll probably um get some um she's a good student and will be hopefully eligible for some scholarships. We do have the funds to bankroll the rest of her college if needed. Okay. All right. Yeah, let's just make sure she gets through college

and chooses a college that the two of you together can afford. I'm really not concerned about her starting retirement until she gets out of college debt-free. If I can get a kid through college debt-free and they graduate with a degree in something that's actually usable, I call that a big victory. And let's just get there. And then they've got plenty of time. Because they're debt-free, they'll be able to start their retirement immediately with their first job,

and they'll easily be headed towards millionaire status. Again, assuming we're getting a degree in a field that is actually marketable that you can actually make a living in. Sure. One other question I have for you. Okay. She has a small amount of money, like $1,200 or so, in double E bonds that she got as a baby,

and that's not earning very much, anywhere from 1.6 to 2 point something percent. What about cashing those out and putting that towards any sort of retirement account or college? I'd put it in college. I'd put it in our mutual funds because it's not earning anything. But no, I would not build a retirement fund unless you guys are multimillionaires and, you know, college is just a slam dunk, you know, and there's just zero question. You know, I mean, I want to make sure she gets through school before we worry about her retirement fund. Really a big deal. We can get there.

We've made a big – that's a huge breakthrough. Hey, thank you for being a new listener. This is the Dave Ramsey Show. This is James Childs, producer of the Dave Ramsey Show. Once again, you made the Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe today.