The Ramsey Show - App - Don't Let Your Dream Turn Into a Nightmare (Hour 2)

Episode Date: September 12, 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'm Dave Ramsey, your host. Thank you for joining us. We're so glad you're here. Open phones at 888-825-5225.

That's 888-825-5225. Ray is with us in Chicago. Hi, Ray. How are you? Hi, Dave. Thanks for taking my call. Sure, man. What's up? Alright. Hey, I was calling because my wife and I

are on Baby Steps 4, five, and six. And we have two high school seniors. They just graduated, our two kids, high school seniors. They just graduated. We have another one in high school as well. He's a sophomore now, but we homeschool. So we had a 16 year old and 18 year old graduate at the same time. But anyway, we started your program late in life. So we do not have any

college savings. Um, and obviously we need to resume, uh, you know, paying, you know, resume retirement savings and that kind of thing. So just calling to get some advice as to maybe how to navigate that. Gotcha. What's your household income? It's usually, let's see, okay. I would say $125,000. My wife works part-time.

And you're debt-free except your home, and you have your emergency fund in place. Yeah. How much is your house payment? $1,750. It actually went up briefly. I think it's $1,800. So you're in a position to cash flow and help some, but not just to write the checks and pay for it.

Yeah, yeah, yeah, yeah. Like my 18-year-old, he started uh as a server at cracker barrel so we're thinking of talking with him about hey you know using a portion you know using half using 75 or whatever and then you know setting up a budget with him uh they are interested they've been listening to a lot of stuff we talk about so they are interested in being debt free they don't want to start with the student loan so they're going to community college here locally there's four or five things you can do to get through school debt free when you're broke okay and that's where you guys are you're you're not sure you're not completely broke but as far as college goes you you're broke. And so, because as you said, it's a late start on things.

Oh, yeah. The biggest variable by far that determines whether or not you can get through school debt-free is the cost of school. Mm-hmm. And so college choice, choosing, like you said, spend some time in the community college, do a couple years there. That's much cheaper. It's usually about 25% of regular tuition, and you can get the basics out of the way there. And, of course, a lot of people live at home when they're doing that, so it saves on housing costs and other things. Then the other thing we're looking at is in-state tuition.

So here's what happens. The college you graduate from is where you get your degree. So no one says, did you go to school there four years? For instance, I graduated from the University of Tennessee. I went to Middle Tennessee State University and also a state school my first year, transferred up to University of Tennessee after three years and went three years there. But no one ever says, Dave, did you go anywhere else as a matter of fact very few people even know what i just told you you know it's not i'm not ashamed of it mt issues of fine school but it was in our area and i lived at home the first year and drove back and forth because that's all i could

afford to do so that's what you do you pick a a car, you can afford to drive. You pick a school you can afford to go to. And so you pick an inexpensive school to get your degree in. Of course, we're going to study something that actually has application in the marketplace. The second thing you're going to do, and you've already done this, is junior gets a job. And I'm not sure, and I like Cracker Barrel. I ate there, but I'm not sure Cracker Barrel job's going to get you through school. You need to make more than probably is making there, unless he's getting really good tips. Because you need to get up $15 an hour, $18 an hour average. And that's going to be walking dogs, cutting grass, delivering pizzas, some stuff like that to get your per hour up.

And you're going to work a lot. I worked a lot when I was in college. You probably worked where you were in college. It's not child abuse. Yeah, I did do it's actually good for them okay and so um as a matter of fact the studies tell us that you have a higher percentage of people who work while they're in school graduate and we have a higher higher gpa the ones that work while they're in school uh i think it's because they're having to pay for it, so they actually freaking go to class. I guess that's probably got something to do with it.

I don't know. But we've got all kinds of studies that give us that answer. The varsity athletes and people who work while they're in school have a much higher class attendance and a much higher graduation rate and a much higher GPA. And I guess it's just because there's so much required. You have to organize your life, you know. So class or school choice.

The next thing I would do is say, let's take the ACT, and then let's take a class on how to take the ACT and then retake it. Most schools are super scoring now, meaning if you take the test three times, they take your highest math score of the three. They take your highest English score of the three. They take your highest English score of the three. They take your highest science score of the three, and they put the best of them all together to create a super score, and that makes you more eligible for scholarships,

which brings me to the idea that we're going to apply for, I don't know, maybe 1,000 scholarships. That's a junior's also new part-time job. You get turned down for probably 950 of them, but if you get 20 or 30 of them at a thousand bucks it'll get you through and so you just it's a high it's a high numbers game so scholarships school choice work while you're in school of course we're choosing a again a field that actually has something where you can get a job when you get out

but you can work through when you get in school. I looked it up. The University of Tennessee is a fairly normal state university school. It's about average as far as cost goes. It's $13,006 a year right now for in-state tuition. So $1,000 a month, and you can make $1,500 a month delivering pizzas. So you might not win the beer pong tournament. Your social life, you might not have the college experience.

I didn't have the college experience. I lived off campus. I worked 40 to 60 hours a week, and I graduated in four years with a 2.97. So, because I needed to get out, I was tired of paying for it. Sure, sure. And so this idea, I'm going to go ahead and stay in five years because this is just fun. That crap goes away when you're working and paying for it. So that's what these kids are facing, and it's not a bad thing.

It's character building. It's not abusive. It just forces them to make some adult decisions instead of extending their emotional adolescence another four years. And so step in, you know. You know, they may not win the InterVarsity fraternity trophy. Well, whoop-de-doo. They're going to go through school and get an education.

The goal here is be smart people. The goal is not the college experience. If you want the college experience, I ain't got any problem with that at all. Go ahead, but don't tell me you have to finance it because I don't have any time to work with all of my social obligations. Cry me a river.

I'm just old and grouchy. So that's what you do. You work your way through, dude. You can do it. Thanks for the call. Open phones at 888-825-5225. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options?

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chministries.org. Jared is with us in Oklahoma City. Hi, Jared. How are you? Oh, what's up on this side of the gate this morning? So I guess I'll do what's on the phone. I hear you, brother. How can I help? I got a question.

So my wife and I are currently working on baby step number two, getting our debt paid off and stuff like that. Eventually we'd like to buy a house that has some land on it. We live in the center of town right now. And a piece of property has come up that is a little over five and a half acres with an unfinished home on it and a half acres, uh, with an unfinished home on it and a trailer home on it for 170,000. And, uh, basically, uh, I'm just wondering if you can't get this bad of an idea as it sounds like, um, we've kind of thought about maybe selling

our home cause we've got a lot of equity in our home. We owe less than $100,000 on it. It appraises for around $157,000, I believe. And so we've thought about possibly selling our home and using the profit on it as a down payment towards this new piece of property. But we would also have to take out a construction loan to finish the barn home. So, I mean, we've got, like, our total debt right now comes out to be about $27,000 split between a car, a signature loan, and then a loan that my dad gave me when we fell through some hard times and had a lot of debt. What is your household income?

$60,000 to $80,000, depending on bonuses from my part-time job. What experience do you have around construction? I'm sorry, do what? What experience do you have around construction? I'm sorry, do what? What experience do you have around construction? I did construction myself in Botech for a year, and I helped my dad renovate their whole house. I could probably do quite a bit of it myself. I've got a lot of plumbing experience and some electrical experience as well. What will it take to finish the house, money-wise?

How much money? Money-wise, roughly, they've got the frame, the utilities, and the pad already done. So they think around $60 a square foot, and the interior of the home is approximately 3,200 square feet. But we would also turn part of that into an attached garage, which would cost less than the original, than the $60 a square foot. Okay. So you're talking about going another $200,000 in debt on top of what we're already talking about just to finish this house? Probably, yeah.

Which would put you like $350,000 in debt making $60,000, $70,000 a year? Yeah. I don't think so. Yeah, when you said it like that, it all comes together there. Because your initial purchase that is borrowed plus your construction loan and and you know you're talking about 200 grand is what your 60 bucks a foot on 3200 is 200 grand um it is going to be 300 000 and you have to have a final what they call the takeout mortgage your permanent mortgage arranged in order for them to give you the construction loan.

And so it's all packaged together. In other words, you have the permanent mortgage set up for when construction is complete to pay off the construction loan and the original loan all in one new mortgage that would be in excess of $300,000 with what you're describing. I don't think you're going to qualify for it. You might, but I don't think you're going to qualify for it you might but i don't think you will and so yeah it sounds kind of fun uh i mean i like a piece of ground around me i'm like you i got about 20 acres my house sits on and i like that um i'm that guy uh i don't want people right up next to me i like people but i don't want them right up next to me and so um you know i I kind of sympathize with where you are,

and I know how to swing a hammer, too, just like you do, or turn a wrench. So you can see how you could do this stuff, but I'm afraid the allure of this is causing it to bite off more than you can chew. And doing this construction, trying to do this construction on the cheap is a good way to get a product, get a house half finished and run out of money or something, and you don't want to be there. I've run into a bunch of people there. So I think we're probably going to pass on this one.

That's kind of what I thought. I think the initial thought of land going for cheap out here, because in Kingfisher County, I don't know how much you keep up track with the oil field. The oil field is crazy in Kingfisher County right now. Yeah, I do. And, you know, the problem is as soon as gas goes down, as they just decide in the Middle East to turn on the faucet and drive the supply up, then the price drops, then suddenly all of this prosperity dries up for a short period of time.

And so the problem with oil money is it comes and then it goes, and then it comes again, and then it goes again. And so I've watched these oil field economies for 30 years come and go several times, and so it's hot right now, which is exactly not the time to buy yeah i mean land lands going for about 20 000 an acre out here which is not the time to buy it's it's insane yeah it's ridiculous yeah um i i get your dream i want you to live your dream but what i've always found is sometimes if i do my dream wrong it turns into a nightmare and that's what i'm trying to help you not do.

So there's a lot of appeal to this deal, but there's two or three red flags here that make it a killer for me if I were in your shoes. I'm going to pass, Jared. Hey, man, thank you for the call. You'll get your dream place, by the way. Just don't do it in such a way that it becomes a nightmare. Kyler is with us in Tacoma hi kyler how are you uh pretty good dave how about yourself better than i deserve what's up

so um my fiance and i are trying to decide whether we should buy or sell our house um we have to relocate to bellevue washington Washington for her job, which she's currently commuting there, and that's costing quite a bit in gas and vehicle maintenance every month. So we're trying to decide whether we should keep the house as a rental or just sell out and move up there. Okay. When are you getting married? We're shooting for next september okay uh why so long um we're just trying to get all our finances in order and then why you're already living together yeah um well, because I recently just got out of the military, and then I'm going to start school. So?

And she just graduated, so we're just waiting to plan everything out. And you're acting like you own this house together, and you don't. Who owns the house? I do. Okay. So you have a house, and you have a roommate. I guess so, yeah. Yeah yeah that's what the law says i mean she's not on the deed so we don't have a house because we aren't married so um i wouldn't wait i wouldn't wait till september if i were you to get married i get married immediately

and yes i would sell this house no i would not rent it long distance so you are you going to land a new you're going to land a new job up in her area, the new area where she's commuting to? I am going to start college up there at Bellevue College. Oh, okay. So you're going to be on the GI Bill, and you'll get your stipend and everything. Very cool. Yep. Well, thank you for your service. I appreciate that.

So if you were my son and you're his age by the way what i would do is as his dad i i would lovingly tell you to get married immediately sell the house move up there go to college rent uh while you get through your degree you've got you've served your country you've earned the right to this degree thank you go get that degree and get it in something that is actually marketable get a good degree that causes you to be able to get a job. Okay? I'm looking at a network engineer. Excellent.

Excellent. That's a perfect thing to do, especially in your area there. Big, big pull for that. And so you're in a tech corridor, obviously. So, yeah, that's really good. What does she do? She is a software engineer. Yeah.

And you guys are 25 or 26 uh i am 26 and she is 23 yeah funny how i knew that isn't it hey that's what i would do if i were in your shoes brother you do what you want but you call me and ask and then i will tell you this is the dave ramsey show This is The Dave Ramsey Show. Hey, guys. At the Dave Ramsey Show, we really value your input. It helps us to know what's important to you so we can deliver relevant content to help you crush your money goals. We just launched a brand new survey, and we'd love your feedback. It only takes a few minutes, and you'll be entered to win a $100 Amazon gift

card. No purchase necessary. Take the survey at DaveRamsey.com slash survey or text survey to 33789. Ursula is in Fort Lauderdale, Florida. I see on my screen you're debt-free, Ursula. Way to go. Yes, I'm debt-free.

Love it. How much have you paid off? I paid about $65,000 and $31,000 a month. Good for you. And what was your range of income during that time? I went from $69,000 to making $110,000 back to making about $100,000. Good for you. What do you do for a living? I'm a registered nurse with a master's degree, and I work in nursing leadership, and I consult on the drive. Okay. So you just worked your tail off, didn't you? Yes. I picked up every single extra case I can pick up, all the shifts I can pick up just to get it done.

Cool. What kind of debt was the $65,000? So I had a little bit over $48,000 in student loan debt and $16,600 in credit card debt. Okay. How old are you? I'm 29. Good for you. You did it before you're 30. Look at you. Yes, I'm really excited. We worked really hard. Yeah, two and a half years you've been getting after it, kiddo. Well done. So what got you started on this 31 months ago? Well,

it all started when I quit my full-time job to go back to school to get my master's degree. I had a two-undergraduate degree with no debt, and then I kind of bumped my head and fell into debt without a job. So I had to use credit cards and student loans to, of course, pay for school but also live. And then in August and September of 2015, I decided to pay it off right after I graduated. And so I'm finally done. I finished about five months ago tomorrow. Wow. Good for you.

Yes. So what do you tell people the key to getting out of debt is? In your case, it's a lot of hard work, for one thing. Just working. I mean, working your butt off, remaining faithful to God. I still continue to do my tithing and giving as I could. And God just blessed me along the way with them. I had the opportunity to move to Texas,

and then I moved back when I was done paying my debts so I can be back with family. It was a lot of sacrifice, but I am so grateful to be done. Very well done. Well, congratulations. How does it feel? It feels so good. I'm still on cloud nine. I really am.

And I thank God and all my family and friends for the support. So you had some good cheerleaders? I mean, I had a lot of good cheerleaders, and I was able to introduce the plan and give the plan to some friends and family. And so a lot of people around me that I'm surrounded by are doing the Ramsey plan. Love it. So we are all just moving towards being debt-free. I'm so proud of you. Very well done.

Ding, ding. Who's your biggest cheerleader? I would say my sister, Gerla. She always would always say, are you done with your debt yet? And I have my friends, Tiffany and Marla and Lurianna, who are also doing their debt-free journey. And I'm rooting for them as well as everybody for me. Very cool. Good for you.

Well done, well done. Well, we got a copy of Chris Hogan's retire-inspired book for you. We want that to be the next chapter in your story, that you become a millionaire, and I think you're on your way, and, of course, be outrageously generous as you go along. Good job, kiddo. Yes, yes. Very well done. All right, it along. Good job, kiddo. Yes, yes. Very well done.

All right, it's Ursula in Fort Lauderdale, Florida. $65,000 paid off in 31 months, making 69 all the way up to 110. Lots of OT, lots of extra jobs. Well done. Count it down. Let's hear a debt-free scream. Five, four, 5, 4, 3, 2, 1.

I'm debt-free! Yeah! Woo-hoo-hoo! Love it, love it, love it. Augusto is with us in Sacramento. Hey, Augusto, how are you? Hi, Dave.

I got a question that I think is going to be funny because you always talk about this German polka master degree, and I'm wondering if my son's career could fall into that or not. I think it doesn't, but I want to hear your opinion on that. Okay. He's trying to pursue a master in music composition and doing film scoring, and

I am a musician myself. I mean, I'm a pastor, but I'm also a musician, and I kind of supported him on this idea that go for your dream and do whatever your passion is and what you're good at, but the thing is, is he going to be able to pay the bills,

or if you have any thought on that. So he's getting a degree in film scoring. Music composition is the degree. Oh, music composition. Music is what he wants to do. Oh, music composition. Okay. Well, I mean, the way you answer the question is not asking me.

The way you answer the question is try to figure out what the guy's going to do. What's his job going to be? Yeah, that's kind of the question. Has he already gone and done this? No, no, he's a senior in high school this year. Okay. Well, then my challenge to him is not, you know, you can't just blindly say we're going to live our passion. That doesn't work. Yeah. I mean, you could have a passion in something stupid that no one will pay you for, and that's ridiculous.

You don't want to do that, especially going spending money to get the degree in that. So, I mean, he is in California, okay, Sacramento, not L.A., but you're in the vicinity of where a lot of film has scores written for it. I'm not aware of necessarily people coming out of college and immediately writing music compositions for film scores. I would think it would take a few years to build a reputation, to build a network of people that knew that you had some talent, even if you're talented. And so probably his first step out of college is not to make a living

writing film scores. That's my guess. I don't know. I don't know that business that much, but I would guess that they don't hire a lot of entry-level people to write film scores coming out of college. I can't imagine that, as a matter of fact. But it's possible.

But if he's a savant, if he's unbelievably talented, like world-class, you know, top 2% or something, maybe. But the typical guy that's just, you know, he's just a songwriter coming out of school, I doubt it. But anyway, so then what's just you know he's a songwriter coming out of school i doubt it but anyway so then what's he going to do for a living yeah that's that's the question right yeah and i don't know the answer to that but he needs to answer that question before he goes and gets his degree okay because the number of people who make a living writing film scores is very, very small. Think about it.

I mean, very small. Yeah, and my concern was because we moved to the States a couple years ago, and we were not expecting to pay for college, so we didn't do any funds. We're debt-free, but we don't have the ability to pay for his education at this point. So he needs to pick a school that's very inexpensive and plan on working a lot while he's there, and then hopefully you can throw some in to help him as he goes, but he needs to go to an inexpensive school.

So he's probably not going to UCLA film school. No, yeah, of course. But because of your videos, he's been working very hard on the SATs because that will help him get some scholarships and that stuff. So he's kind of working, and he's intentional about it. But at some point, I think we will have to make, like, big decisions on that. And I'm not sure if a music career is worth those big decisions. Well, I mean, a music career could be.

But, you know, what does the music career look like? I've got a friend who plays in a local orchestra and makes a pretty good living doing that, you know. And if that's what he wants to do, that's okay. There's nothing wrong with that. But I want this young man, an assignment of his, if I'm his dad, is you have to tell me before I'm going to participate in this decision with you how you're actually going to make a living. Because I'm going to just throw out a number. I'm just making this up.

I don't know if it's accurate but let's say that a thousand people which is probably the most possible actually make a living on the planet writing film scores for a living it's a very narrow field and it probably is going to take some time to break into or an unusual level of talent to break into or both and so as your b plan with a music compensation compensate a compensation composition see i can't even say it why are you asking me anything you know if you've got that degree as a B plan, what are you going to do to make a living? So let's find a way to live our dream in such a way that it doesn't become a nightmare. That's all we're saying.

And that's loving him well. To guide him in that. It's not a time not to do it, but don't do it unless you can tell me how you're going to make a living other than writing film scores. This is The Dave Ramsey Show. Thanks for joining us, America. This is the Dave Ramsey Show. Glad you're here. Open phones at 888-825-5225. Ann's with us in Minneapolis.

Hi, Ann. Welcome to the Dave Ramsey Show. Hi. Thanks for taking my call. Sure. What's up? Well, I have come to a new chapter in our book with our family. My 16-year-old got her first job all by herself. Yay! Yeah. So, I don't want the money burning a hole in her pocket. She is one that if she gets any money, she's like, oh, what can I buy?

She does have a savings account. It is under our name, so we have to get it out for her. So she doesn't have a debit card, which I don't think would be smart on our part, but she wants to know what she should give. a debit card, which I don't think would be smart on our part. But she wants to know what she should give. She always wants to give at church, and I do want her to start doing that, but I'm trying to figure out the happy medium. And I thought, well, I told her, I'll call you. Okay, that's fun.

Well, one of the things we tried to do when ours were teens was to lengthen the rope. Now, the rope was tied around their waist metaphorically. When they're little kids, you hold the rope real close because when they're three, they'll kill themselves if you don't protect them, right? And so that's true as teenagers, too. But you need to give them more and more rope, more and more freedom to make decisions, even make a few mistakes while under your wing so that because what you're doing is training them for adulthood because when they leave you want them to stay gone until they have grandbabies and then they can come back yep but you don't want them living in your basement okay so the point being we want to teach her the the role with this is not about the money

this money is a teachable moment this job is a teachable moment. This job is a teachable moment. She's not going to learn anything or do anything at this job that's going to change her life. But she is going to learn about work. And that will change her life. And with money, there's not enough money that we're dealing with here that's going to change her life. But her handling it is going to change her life. So it sounds like this. If I'm her dad, okay, and so God help you if you're Rachel Cruz or Denise Whittemore or Daniel Ramsey, okay,

because this is how you grew up. My job as your dad is to give you the equipment and the knowledge and the skills to win as an adult. And so I am going to do my job. You are going to get that equipment, whether you like it or whether you don't. You're going to get that equipment, whether you like it or whether you don't. You're going to get that knowledge, whether you like it or whether you don't. The good news is you're going to like it most of the time. So adults that handle money well do three things with money. They give some, they save some, and they spend some.

And so you're going to do a budget, and whatever money you bring home, we're probably going to do it on a percentage basis because you probably don't have a steady job as a 15-year-old. You're going to take a percentage that you and I decide and agree on, and you're going to give that. You're going to take a percentage, and you're going to save that. You're going to take a percentage, and you're going to spend that. Now, what percentage of your check do you want to spend? What percentage do you want to give? And what percentage do you're going to spend that now what percentage of your check do you want to spend what

percentage do you want to give and what percentage do you want to save and if they give you something reasonable go with it you know i want to give 10 at my church okay good i will go with that and i want to save 20 good and i want to spend the rest that sounds good to me let's do that okay the point is you're trying to teach them to have all three of those muscles those money muscles to have some tension to them the giving muscle the spending muscle and the saving muscle you want them to be able to work give save and spend work give save and spend if you can do those four things with money make money and then give save and spend it properly you can win at 54 at 24 and at 14 so that's where we want to take her to and then i'm going to enforce that she does that now after we get that in a little bit of a rhythm the next thing

is i am going to open a checking account okay and let her have a debit card for her spending and teach her how the checking account works because i want her to have that rhythm the funny thing is the oldest child denise Denise, never bounced a check. Rachel Cruz bounced checks like the third week she had the stupid thing. No. Yes. And now she's the money guru. Go figure.

That's how God works, right? But anyway, so I come home. And can you imagine me and Dave Ramsey's kid bouncing checks? Oh, my God. So, yeah, she had stuff bouncing all over the place. So I said, well, you know, you're not not in congress you can't keep spending money when there's no money in there we covered this you knew you didn't keep up with it you didn't keep your checkbook balanced you didn't keep it reconciled you didn't know how much was in there so i taught

them the skill of how a checkbook operates okay so then when they went to college all three of them stayed on budget all three of them did not bounce to college, all three of them stayed on budget. All three of them did not bounce checks in college. All three of them. And it wasn't a miracle. It was a trained skill. And we weren't a bunch of nerds. We didn't sit around and have money meetings or anything like that. We just said, I'm going to teach you to brush your teeth.

I'm going to teach you to drive a car. I'm going to teach you to mow grass. I'm going to teach you how to balance your checkbook. And I'm going to teach you how to give, save, spend. Work give save spend work that's all it was just the rhythm of our life it wasn't some kind of nerdy thing or anything like that and the good news is it's it's all adult activities and so she will like that teenagers all want to do adult activities yeah they just don't want to always do them right so that's where we have to come alongside them but i think if you'll do that keep those couple things in mind work give save spin and then let's move towards a checkbook with a debit card after a few months and then you watch over that okay i looked over i know where every

dollar went even in college where all their money went to i have full full visibility to their grades full visibility to their which they have to sign a thing in college now for you to do that, full visibility to their checkbooks. Why? It was my freaking money. That's why. Well, yeah. And I'm not going to let them misuse it and misuse their life. They're there for a certain task, and that task could get your butt to class.

And so, you know, we're going to follow all of that along, and that's how we did it. Now, we're old-fashioned parents. We don't believe, you know, we believe the inmates don't run the asylum. And so that's old school, and some of you, you think your children need more freedom or whatever. That's fine. That's fine. None of mine are in counseling, to my knowledge, because of my treatment of them. They were all taught how to have control, self-control,

and they learned that first from dad control. That's where that came from, and mom control, for that matter. Sharon can be a really tight hillbilly woman when she wants to be. So anyway, that's how I would do it. I would get after it that way. Hold on. I'm going to give you a copy of the book Rachel and I wrote together. It actually tells the story in the book of her bouncing checks.

It's a cute story. And it's called Smart Money, Smart Kids. It's for parents on how to teach your kids how to handle money. It's the number one best-selling book. I'll give you a copy of it. Alex is with us in Evansville, Indiana. Hi, Alex. How are you?

I'm great. How about yourself? Better than I deserve. What's up? Well, I wanted to ask you what you would do in a position like myself. Just to give you a little bit of backstory, I'm 18. I'm currently going to school at Purdue, and I have a job at a local foundry working part-time now, but during the summer I work 60 hours a week to make as much money as possible.

Good for you. Yeah. Currently I'm working about 24 to 27 hours a week, making $500 a week that's before taxes. Way to go, dude. How are you paying for school, that? No, I was actually, I got really lucky. I got a full-ride scholarship.

I was just really lucky. Well, that's not luck. It's not luck. How'd you get a scholarship? Academics or athletics or what? Academics, but it wasn't through the school. It was actually through my community. They're really big on higher education, and I was blessed, I guess you would say.

Well, and you worked your butt off to get the grades, too. You can be smart and lazy. You weren't lazy. Yeah. Good for you. So what are you studying? Electrical engineering. Good.

Very cool. Oh, man, you've got a great life ahead of you. You know how to work. You're studying good stuff. You've got a leg up. Well done. Well, what I would do with all this money you're making is I would just pile it up. I want it to be your insurance

policy to ensure that Alex graduates a Boilermaker with an electrical engineering degree and no debt. In case something falls through on some of those scholarships or something, I want you to have enough money piled up to make sure you get out of school.

The best investment Alex can make is literally, mathematically, in Alex. Because with what you're studying, getting that degree and getting it without any debt sets you up to make so much money. You're going to do so well. Man, I love it. Well done. Now, you get out of school and you got all those scholarships and that money's just still sitting there? Well, it helps you start your life.

You're ready to go then. Then you can start investing, start talking about buying a house, start talking about doing some other things. But I'd just be patient right now. Pile that money up and make sure you get through school with no debt. That's your number one job. Job one, man. This is The Dave Ramsey Show. Hey, man. This is The Dave Ramsey Show.