The Ramsey Show - App - Don't Spread Yourself So Thin That You're an Inch Deep (Hour 2)

Episode Date: June 23, 2020

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us this hour. My co-host is Christy Wright, number one best-selling author of the book Business Boutique. She'll be with me today, or this hour and next hour here on The Dave Ramsey Show, answering your questions about your life and about your money.

Open phones about 888-825-5225. That's 888-825-5225. Christy, you ready for the phones? Let's do it. All right. Ethan is in Indiana. Hi, Ethan. Welcome to the Dave Ramsey Show.

Hi, Dave. Hi, Christy. How are you guys? Great. How can we help? My question is for Christy. I'm curious how do I separate my side hustle money with my personal income and other stuff like that? How do I keep my things separate? And then also with the money I get, how much do I put aside going back into my

business? How much do I keep to the side for my material to buy? And then how much do I keep for profit? Yeah. What's your business? 3D printing. I have a 3D printer and then software to design stuff to print out. Cool. How long have you been doing it? I've had the knowledge for the software a long time, but I just recently got into 3D printing. Okay, cool. So when you said, how do you separate the money?

I know this sounds like a really simple answer, Ethan, but you literally just have separate accounts. It can be very, very simple. The tempting thing when you have a side business is to let the money kind of flow between the business and personal and oh, you're checking out on Amazon. So you throw a few things in the cart for, you know, your business or you're checking out at the local store and you buy these things together just because it's easier or you grab your personal debit card to pay for something. But that just mixes up the money and it mixes up all possible clean record keeping. So what you want to do is you want to open a business checking account and all revenues from the business go into that checking account and all expenses for the business come out of that checking account. What that's going to do is that's going to help you keep everything straight. And then when it comes time to pay taxes and that type of thing, it's

going to really help you do that. When it comes to reinvesting back into the business, Dave, I'm excited to hear you hear about this too. But part of that depends on your goals. Part of it depends on what are you working towards? Are you saving up to have an emergency fund in your business? That would have an amount that goes in for that. Are you saving up because you need to buy a new piece of equipment? You might be saving up for that or are you just in maintenance mode where most of the money is going to um you know after you pay for taxes and your expenses it's going to be take-home pay dave do you have a kind of a rule of thumb on that for percentages i think you're exactly right i think the idea is i mean if it's a side hustle and

you're just trying to grow the business and you can live out of your day job, you may invest all of it back in. That would be fine. There'd be nothing wrong with that. But if you need some of the money to come out, your work and your debt snowball or something like that, then, you know, you could just decide a percentage. But there's not a magic number. There's not a specific number. Obviously, the more you invest back into it, the more you're going to grow it if you invest it wisely into new products, new inventory, that kind of thing. And obviously, you've got to put enough back into it to keep it running.

So, for instance, if you're doing a hard product and you're selling that hard product, you've got to buy the next set of inventory. So you've got to hold enough back to do that. And so you've got to do some accounting to do all of that. But that's not really that hard to figure out. Once you're making a profit, what are we going to do with the profit? Do we take it home or do we need to take it home? Can we live without it at home in order to get the business to go up another notch? Also, when you're opening that separate account she's talking about, that's just a DBA account, Doing Business As. And so it's Ethan so-and-so doing business as Ethan's 3D printing

or whatever the name of your company is. It's a sole proprietorship. You don't even need a tax ID number to do it. You can do it with your social security number. You definitely don't need to be incorporated to do it. So just simply open a separate checking account. You know something I see, Dave, all the time, and I see this. It's really tempting when you're running a side business, and you hear this all the time, what's the difference between a hobby and a business? A hobby costs you money. A business makes you money.

I was thinking of this when you were talking about reinvesting money back into the business. One of the things I see people doing when they're starting a side business, and it's really tempting, they spend money on the business because they, quote, unquote, need this thing. They need a new computer to be a writer. They need fill in the blank with whatever it is. And they really don't need it. What they're doing is they're trying to buy this stuff, fix up this home office,

have this equipment to somehow validate. I'm really doing this. But what happens is they get in the habit of spending money on the business. That's not producing an ROI. That's not necessary. And they end up not making any money. And it stays a hobby for years because they're spending all the money. But we've got a real collection of gadgets. Yes, and it's not growing.

It's not what you said. It's not putting money into the business to grow it. It's just I'm going to spend it to make it feel real, and I've got a new suit and a new computer, but I don't have any money in my bank account. No, we're going to treat this like a business. If you need the money to invest to create a return on your investment. Well, by definition, an investment is not consumption.

By definition, an investment gives you a return of the investment and on the investment. And that's what you meant by ROI, return on and return of investment. And so, you know, if you put $1,000 into something, you need to get an extra $1,000 back and some more. Yeah. Otherwise, if you didn't do that, then that wasn't an investment. That was just an expense. Yeah. And really, when you look at all your businesses, you know, you look down your P&L,

all your business items should be investments, not expenses. We call them, you know, revenue or expenses. From an accounting standpoint, that's what we call it, but you need to view it as an entrepreneur as the idea that we don't have any expenses. We only have investments. John is in New Jersey. Hey, John, welcome to the Dave Ramsey Show. Hi, Dave. How are you doing today? Great. How can Christian me help? Hi. So I am a 23 year old working right outside

the New York city area. I've saved about $30,000 within my first year on the job, especially with the Corona virus. And my question for the two of you is what is a good baseline saving until moving out to rent as rents have steadily dropped outside of New York and in the whole Boca Jersey City area. So my question is to continue to save or take advantage of dropping rent prices throughout the area. Go ahead. Well, I think a lot of the questions I feel like we get are around values. What are your goals? What are you trying to work for? Some of this is a little bit on you, John, of what are you working on right now? What are your goals?

So I have two jobs. I work as a financial advisor for a bank where I take on majority of my income, and then I coach on the side where I make about $10K coaching, about $50K being a financial advisor. Long-term goals is to eventually buy an apartment building, but that down payment for a mortgage is a little bit off of the $30,000. Yeah. Well, you've done really good with the $30,000. Congratulations, and you've done that really fast. There is something that happens developmentally when you get out and pay your own bills.

You're a sharp dude. You got your act together. You got really solid skills. You've saved 30 grand. You've got a good, solid job. You got a side hustle. You got everything going for you. But the next step of your personal emotional evolution is to be on your own.

If you were my son, I'd tell you to move out right now. Not because I don't like you, but because I do. This is the Dave Ramsey Show. Families all over the country are discovering a faith-based and budget-friendly way of meeting health care costs, whether they're anticipated or completely unexpected. For example, take the Olcheski family from LaGrange, Texas. Jeff and Carice had just celebrated the birth of a new baby boy. Shortly after, they had another expensive medical issue come up. They could have faced a huge financial setback, but thanks to Christian Health Care Ministries, the Olcheskis were spared from a ton of medical bills. As members of CHM, they're part of a group of believers who financially and spiritually support each other.

CHM is the longest-serving health cost-sharing ministry and is a Better Business Bureau-accredited charity. It's Christians helping other Christians. And it shared nearly $97,000 to help the Olcheskis. To be a part of Christian Healthcare Ministries, visit chministries.org. That's chministries.org. CHM is a proud sponsor of Dave Ramsey Live Events. christy wright ramsey personality my co-host today here on the dave ramsey show carol is up next in new jersey hey carol welcome to the show how can we help carol carol three two one you're gone okay up next is jesse in michigan hey jesse how are you

oh i'm just great good how can we help taking my call sure um so i have a hobby farm in michigan and we are now just starting with four pigs and three goats and um just thinking about uh starting it up as like a business for us and I have no idea where to start I I have no idea why do you why do you want to be a business well um we're thinking about like becoming a pig breeder um I mean, especially with COVID right now, people are kind of freaking out about where they're getting their food from. We have some chickens that are layers and a couple of meat birds as well. But we're just kind of thinking about being a little business here in West Michigan

for local people to know where their food is coming from. So I just, I don't know. My husband and I were just talking about it and we're like, well. So what is your, what's your question then? Like, where do I even start with coming up with a business plan or, like, I mean, the legal, the legality of everything as far as, like, taxes and everything. I mean, I feel like actually, like, doing the animals and working with them, that's the easy part. It's more or less the organization of the animals and working with them that's the easy part um it's more or less the organization of the business and whatnot because i'm a teacher so um i have no idea how that all works yeah well you know here's the thing jesse and this is interesting because i hear this from a lot of people regardless of the business it feels to you like the business stuff is probably

95 of running the business. And the actual farm part, that easy stuff, like you said, is 5%. Because that is the stuff you don't know. So it feels big. It feels consuming. It feels overwhelming. Ask anyone running a business. And it's more like that's the 5%. Like you need to know your, you know, have your setup.

You need to have your taxes and keep working. You need to do that. You need to get organized for sure. But the day to day, the quote unquote easy stuff, like you said, that's actually 95% of it once you get going. So I just want to encourage you that it only feels overwhelming because you don't know it. But once you get some of that in order, cover your bases, get set up some basic things that you need to do, running the business is the fun stuff. That's why you want to do it. I want to send you my book, which is Cover to Cover, cover a plan to start your business but a good starting point to answer your question you need

to figure out what you're going to do so what is the service you're going to provide what is the product you're going to sell if it's pigs if it's chickens whatever there's farming has a lot of different ways to make money and so you've got a lot of options but that can be paralyzing so what i want you to think about is what is the starting version of this farm for you? What is the thing that you know the most that's the easiest? You could do it tomorrow. You don't have to do a ton of research on it. And maybe it's the pigs.

Maybe it's the chickens. Maybe it's something else. Maybe it's crops. I don't know. But I would figure out what you want to do. What you've described is not your mission for the business. You've described a need in the marketplace that you've recognized. You have not described how you're going to serve it.

You recognize that because of COVID and standard distribution methodologies are screwed up. There's a beef shortage right now. The supply chains are broken. And people are worried about all the processing and where the meat has been and all of that. And so a farm-to-table, not for restaurants but for homes, is a very popular need right now and a felt need that people are going to react to. That's the need that you've recognized, and I agree with you on the need.

Now, the question is, how are you going to serve that need? It could be with a singular line. It could be pork only. It could be meat birds only. It could be we're going to do two things, but you're not going to raise cattle, pigs, and chick and meat birds and layers all at the same time from where you're starting right now. You've got six animals right now. So don't get spread so thin that you're an inch deep. Yeah, just pick one. And that's what we say in any kind of business, though, Dave.

It's like start small. Start with your 1.0 version of that idea. You might have a dream. What's the low-hanging fruit? What's the easiest thing to start with? Which one of these animals can you scale with the fastest and the easiest and turn into money? And what's going to happen is when you do that, when you pick one, when you have focus and you start doing it, you're going to learn a lot in the process from the market what you need to do more of, less of,

where you're going to make mistakes, that type of thing. You're going to learn a lot, but you're also going to get confidence. When you start getting orders and you start getting money coming in, it builds your confidence to go after these other product lines or service lines to try something new, not just the learnings and the experience. You're also taking with you the confidence built by the fact that you're getting validation from the marketplace. That's a powerful combination, but it only happens that way when you start small and have focus. So I love how you said pick one thing, dial that in, figure it out,

before you start expanding and doing other things. Yeah, don't try to do six things at once and do them all small and have all that learning at one time. And that's not just for farm business. That's any business. I don't care if you're in a tech company. Don't start with 15 different apps. Start with one app.

Start with one thing and focus and get that right before you expand. Joshua is with us. Joshua is in Pennsylvania. Hi, Joshua. How are you? Hey, Dave. How's it going? Great. How can we help? All right. So I'm going to cut to the chase. I'm in high school right now, so I'm going into my senior year. And as of now, I'm doing whatever I can to earn money in order to pay for college. But the main issue right now is I've only made $21, and that's online. And so what is your advice for me? Like, what do I have to do in order to make enough money to pay for college?

Well, what you're doing isn't doing it. What are you doing that made $21? I mean, right now I'm just finding stuff I can do online. I mean, I can't get a job because of COVID. Well, you can get a job. I mean, you can do something that makes money. People are making money right now. I want to challenge that, that you can't.

Pennsylvania shut down pretty tight. I don't disagree with that. But it's not going to be forever. And you are getting ready to go into your senior year. Is that what you're telling us? Yes, sir. So you've got a year to work on this. You'll be fine.

But, yeah, you've got to find some ways to make money, and then you need to start studying schools and find the least expensive school in your area. You may even start the first couple of years with community college. That's a lot cheaper. But, yeah, you've got to create some income as soon as you can and you find ways to do that but um there's lots of people uh even in pennsylvania with everything shut down deemed essential that are doing all kinds of things most states essential included grass cutting so the guys were still cutting my grass when we were shut down in tennessee they were deemed

essential not sure exactly how that works but they were and so kind of glad they were and we'll have a hayfield in the backyard but um uh so you know you may need to fall into one of those categories and the type of job you're looking for but maybe some of the retail jobs you were thinking about over at the mall maybe they're not open and i don't have a problem with that uh so you know find the diamonds in the diamond fields. Find where you can go to pick up some of these things. And Christy's right. You can find something. And then you've got a year to work on this.

And hold on. We'll have Madison pick up. We'll send you a copy of Anthony O'Neill's book, Debt-Free Degree. And he'll walk you through step-by-step exactly what to do. And you don't have to do it forever, Joshua. I think we've been saying that to a lot of people during this pandemic. You might have to do something you don't want to do just to bring some money in.

But like you said, Dave, it's not forever. You may be able to do one of those more fun jobs or an online job that's more in your passions or a retail job, whatever it is when things open back up. But right now you have an opportunity to do something that's going to bring you more income. I don't mind if you concentrate on online. You just got to have more results than you get.

$21 ain't going to get you there, Bubba. Yeah. I mean, you're going to have to make more than that. So if that's not it, if you can't get that moving, then you're going to have to find some more traditional ways to make some money because it doesn't really matter how glamorous what you're doing is. All that matters is you can stack some cash and get ready to go to school, babe. That's the whole thing, man.

You got this. You can do it. That's the whole thing, man. You got this. You can do it. You got your eye on the ball. Hold on. Madison will pick up, and we'll send you a copy of Anthony's book, Debt-Free Degree. It's a number one bestseller for a reason. This is the Dave Ramsey Show. I'm out. Most people's money problems come from not paying attention. That's why before I spend a dime of my money on something,

I do the research and make sure it's going to live up to what it claims. Recently, I got a great pair of sunglasses from a company called Shady Rays. When you're looking for sunglasses, it feels like your options are limited. Name brand sunglasses cost too much and the cheap knockoffs are ugly and really don't protect your eyes. Discovering Shady Rays is a game changer. With Shady Rays, you can count on premium sunglasses that protect your eyes and are affordable. They give people the best overall value in sunglasses. They also replace your shades with a brand new pair

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Hey, guys, how are you? Good, how are you? Better than I deserve. Welcome. So all the way here from where? Tampa, Florida. Tampa, Florida, to do your Debt Free Scream. How much debt have you paid off?

About $140,000. Good for you, guys. Awesome. How long did this Good for you guys. Awesome. How long did this take? 18 months. Wow. And your range of income during that time? It started household around $110,000 and towards the end about $160,000.

Wow. What do you guys do for a living? I'm an assistant principal at Kenley Elementary in Tampa. Cool. And I do property management and sell real estate. Good for you. Well done, you guys. So what kind of debt was this $140,000?

We had student loans, two-car loans, credit card, medical. A condo, some old medical debt, like you said, some taxes, and some old business debt. You had it all. Yeah. And you're kind of like normal plus a little. Yeah. Yeah. Wow. So what, you're kind of like normal plus a little. Yeah. Yeah. Wow.

So what'd the condo sell for? We actually kept the condo. You paid it off? We paid it off. Yeah. That's not our primary, but we paid off the condo. We had another rental we did sell, and we got about $30,000 from that that we put toward the $140,000.

And did you have some money in savings you threw at this too? Not really. No. You just spent on beans and rice. Spent selling some houses. She's been getting after it. Hustling,000. And did you have some money in savings you threw at this too? Not really. No. You just spent on beans and rice. Spent selling some houses. She's been getting after it. Hustling, yeah. So $160,000 for 18 months and paying off $140,000.

I mean, you lived on nothing. Yeah. It was tight. That's very cool. So what in the world happened 18 months ago? Lit you people on fire. Right around that time, I became a new Christian. So I was plugging into just programs that they had at church.

And one of the programs was Journeys of Generosity. Yeah, so it was a retreat, like you said, that our awesome church sponsored. And it's all about just living generously and giving generously. And we were just really inspired by all of the stories. These people were just creating wealth specifically for the purpose of giving it away. And we wanted that to be us. And so we sat down with our finance pastor at our church, Idlewild Baptist Church in Lutes, Florida. And our finance pastor, Rob Taylor,

suggested Financial Peace University as a stepping stone. And so we sat down, we enrolled in FPU, we did our first budget. That was a disaster. We had all these different accounts. So he had his own checking, his own savings. I had my own checking, my own savings. We had a joint. So at any given time, we had no idea how much money we had. Um, and we had no idea how much we were spending either because there were all these different accounts. So right at the beginning, we, we tallied up how much we were spending on things. And we were, we were shocked. We had no clue how much we were even spending on groceries. We didn't even know how much debt we had. We guessed we had like $20,000 of debt and we were way, way, way, way, way off because we were making the payment. Yeah. We weren't thinking

about it. So, yeah. Um, so after we did our first budget, it took a couple months to get a hang of, get the hang of it. Um, we were able to knock some small debts off and just really make some traction. There were some really hard months that we talked about where we felt like we weren't making any progress, and that was really discouraging. We went without a lot of stuff, like your lawnmower. Rachel wanted me to tell this story, but for a few months I was pushing around a three-wheeled lawnmower

just because we didn't have it in our budgetower earlier in the show you talked about hoas and uh we didn't win any awards for those months a little groove in the grass from that one that one corner of the mower that didn't have the wheel i love that that's fun very cool good job you guys thanks wow so generosity a new faith, finding your new faith, leads to the discussion of generosity. You start being other-centered almost immediately. And you go, well, can't be generous because I'm broke. And so we're going to go to class, learn how not to be broke, and go to Financial Peace University. And it starts your budgeting. And then when you add it all up, you're like, whoa, we've got to do this.

Absolutely. And you got serious fast. I think it's so cool that you guys saw that it was possible because i think it would be really easy to learn about generosity and easily dismiss that it's like well that's just for wealthy people that's for with people with a lot of money that's not us and you kind of write it off that that's not possible for you i love that you saw that that was possible and then you were willing to do the work to get there that's That's pretty incredible.

Yeah. It's awesome. Very well done, you guys. All right, you're old pros now. You knock off $140,000 in 18 months. You kicked butt. Tell people, what's the secret to getting out of debt? Definitely communication.

As Rachel was saying, the first couple weeks and months was a little difficult. We were just learning how to budget and figure out where money was going. And as you sometimes speak about, making the dollar work for us. There were times where I'd be in a store and just think about, all right, what kind of conversation do I want to have with Rachel when I get home and just put my debit card back in my wallet and just move on. Think through it a little differently. Absolutely. Nothing like a little accountability. Absolutely. Also having the why,

like we said, you know, we were new parents, so we wanted to be able to pay for our daughter to go to college and we wanted to make sure she had a bright future. And then also just giving generously. Since we got out of debt, we've been able to do some really cool stuff with money. We sponsored a contest at Rich's school. He serves at an underserved school in Tampa. So we did a contest for teacher attendance. And we were able to give a big $1,000 check to one of the teachers at his school.

Neat. We were able to give $1,000 to a foster mom who had five kids at christmas wow different missionaries that uh just you know are close to our hearts yeah yeah and and when you're not broke you can do that absolutely yeah your generosity factor changes dramatically when you got control you got a plan and you're not broke you know you see all the margin and you you comfortably uh can can go you know i'm not being irresponsible as a matter of fact to not answer the call when you when you get a god call like that and god puts something right in your path would be irresponsible but you put yourself in a position to be generous well done guys thank you

sir proud of you heroes you're world changers and i mean think about all the money you're going to be able to give over the next 40 years it's gonna be bizarre it's gonna be so much money i mean crazy y'all are amazing very well done you guys we're very very proud of y'all you're heroes excellent excellent job who are your biggest cheerleaders outside the two of you? Definitely, I think. Each other. We got to give each other a shout out for sure.

But I'll tell this quick story. So we were supposed to get out of debt like eight months sooner than we were. And we were down to like a couple hundred dollars. And we actually called an ELP and had a financial advisor come over because we were getting ready to go on to baby step four once we had our emergency fund set up. And the very next day, there was a knock on the door and it was a process server who was delivering me a notice that there was a lien on our house for $42,000.

Oh! For an old business debt that I was under the impression was paid off and taken care of and was not. So we went from being pennies from being debt free to almost starting all over and having to tell Rich about that was one of the hardest things I've ever had to do. I was so scared and just embarrassed and just really felt defeated. And, um, yeah, that's a kick in the teeth. Yeah. And when I finally told him, I was like, what do you want to do? Do you want me to get a lawyer? Do you want to fight this? What do you want to do? And

he just looked at me and said, we're just going to pay it off. And that was just like a defining moment in our marriage. And, um, yeah, it was just, it was a really cool god moment and just really strengthened our relationship rich you're a pretty good guy man i'm all right not everybody would have reacted that way that's pretty calm i think god's doing a work on you good stuff that's awesome good stuff that's very very cool all right right. Richard and Rachel from Tampa, Florida. $140,000 paid off in 18 months, including the little surprise knock at the door. Making $110,000 to $160,000. Count it down. Let's hear a debt-free scream.

Three, two, one. We're debt-free! Love it! Well done, you guys. That's awesome. Congratulations. Very well done. That's exactly how you do it.

This is The Dave Ramsey Show. Check out this headline, courtesy of Politico.com. Emergency relief screw-up hits 5 million student loan borrowers. Nearly 5 million student loan borrowers who got a break on their monthly payments from Congress have been hit with incorrect information on their credit reports. That's what happens when you just sit around and trust the government to take care of your money issues. Refinance your student loans today to take advantage of the historically low rates Splash is offering. Go to SplashFinancial.com slash Ramsey. well we've all been through some tough times out there recently and when you go through tough times like you might be jobless or you could be really broke you could be really struggling you could have just been really scared You could have come through some medical issues.

Now, the pain's really real, and I don't have the cure for everything, certainly the medical stuff, but we do have the cure for your financial future, a proven plan. Because when you go through stuff like this, everyone's left saying, What now? What do we do now? We're going to answer that question Thursday night. Chris Hogan, Ramsey Personality number one bestselling author.

Rachel Cruz, Ramsey Personality bestselling author. And me are going to be doing an event for about two hours on Thursday evening. It is a free live stream. It's called What Now? COVID-19 and Your Money. Chris Hogan, Rachel Cruz, joining me Thursday, June 25th at 7 p.m. Central Time. It's completely free. We've got several hundred people going to join us here in the Ramsey Solutions atrium.

We'll be doing it from our stage here. The tickets for that are free. They're long gone. You can't get those. But if you'd like to watch the free live stream at 7 p.m. Central Time Thursday night, text the word CONTROL to 33789, and we'll make it available to you completely free control text that word control to 33 789 for the what now event this coming thursday night our question of the day comes from blinds dot com find out for yourself why they are the number one online retailer of custom window

coverings free samples free, and new promos all the time. Always use the promo code Ramsey to get the best deal. Christy, our question. Yeah, this comes from Rachel in Colorado. She visits DaveRamsey.com to ask, I'm in the very beginning processes of creating a business plan to start my own salon. To start the business, it would be roughly $25,000 to $30,000. I have that currently in cash. My husband and I have the same amount in personal debt, credit cards, cars, et cetera, not including our house. My question is, do I pay off my personal debt and get a loan for my business expense, or do I use the cash for the business? Don't you like

how she asked that? It's like two options we don't like. Let me tell you, Rachel. Here's what we're going to want you to do. I don't want you to take out a loan. We're never going to tell you to take out a loan. And we do want you to pay off your personal debt. Now, I don't know, Dave, if that's the only amount of savings she has, but you can pay off that debt. And if you have some left over, I'm totally fine with you putting a little bit into a business.

But I don't think you need to start with a $30,000 investment in a business idea. You don't have proven. You can start a salon in your backyard, your spare room, just you and a chair and working with clients to prove your idea and get some money into the business and grow the business slow at the speed of cash where you're not putting in this investment in cash. Of course, we'd never tell you to take it alone but even in cash we don't want you to take out that big of a risk on the front end so i would say pay off the debt and then if you got a little bit to start a small business from your home or somewhere for just a few hundred bucks yeah i mean you could just start even if you rent the space and just don't outfit all yeah you don't have to put that much money in you can just

put up a curtain and not have all of the booths set up for the salon. People always assume it's all or nothing. It doesn't have to be. You can start with a baby version of your idea. Exactly. And I think that's the answer. So yeah, you write a check and pay off all your debts today, cut up your credit cards, you get on a tight budget, and you save up $10,000. And let's start with that with a business and get going. And I'm with Christy. I think you're overdoing it. And no, we do not tell you to borrow money to start a business. And going. And I'm with Christy. I think you're overdoing it. And no, we do not tell you to borrow money to start a business. And no, we do not tell you to start a business with the cash that you're sitting on that you should be using to pay off your debts. People think business debt's different, you know.

They think it's the businesses. It's not. It's your debt. Someone has to pay those bills and that someone is you. It's still your debt. Small business, there is no such thing as business debt. The bank requires a personal signature it's a personal loan you just happen to be using it on an idea that you declared to be uh business and that's okay but i mean people say i'll use my

credit card to open my business that's business debt no it's a credit card debt you goob it's in your name it's yours it's your credit card it just you used it for business does not suddenly make using a credit card smart it's just it's just the no difference there at all all right kim is with us kim is in new york hi kim how are you hi dave i'm good how are you better than i deserve how can we help um i'm actually calling because my husband and i uh just found out that we're expecting a baby. This will be our first child and we're going to be out of debt at the end of next month, except for our mortgage. Yay! Congratulations on both. Thank you. My question though is because child care for while I'd be working would take up almost my entire income for the month. My husband

and I are discussing the possibility of me instead starting a freelance business as a graphic designer. And I'm just kind of, I guess I'm a little nervous and a little bit overwhelmed about, you know, like what if I don't make enough or what if I can't get clients? And so I was just wondering if you had any advice for how I should go about starting that. Yeah, Kim, I'll tell you the fear that you're talking about is really, really normal because there are some unknowns when it comes to business, but it's also vulnerable when you're talking about a small business, especially a service-based business, you're putting yourself out there. It's your skills, it's your talent, it's your designs. That feels vulnerable. But I

just want to encourage you. You have something to offer the marketplace that no one else can do. You can do something like you can do it like no one else can do. And I believe that God can use you to help people in a way that no one else can. And the fear, I think, is what keeps a lot of people stuck because they think it's a reason that they shouldn't move forward. But I remind people all the time, you don't have to wait until you're not scared to do the thing you want to do. You just do it while you're scared. And if you start small, Kim, you literally might start with like a Facebook post like, hey, I'm going to do some freelance graphic design. Let me know if I can help you or send out an email to your family and friends. It starts so small, so unintimidatingly,

if that's even a word, it's gonna build your confidence as you go. But Kim, if you'll stay on the line, we'll send you a copy of my book because cover to cover, my book, Business Boutique, is a plan. I'll walk you through every single chapter, how to create a plan for your business.

And when you can see it on paper, it lessens that fear even more because you can see the path of how to do this. And when you can see it, you're like, oh, it's not so scary after all. I know the steps I need to take. And so that book will help you put it into practice. But I just want to encourage you, it doesn't have to feel like this terrifying leap. You can just take one baby step today, one baby step tomorrow, and this thing will come to life before you know it. I agree. And here's the thing. If you look at what your options are, it's really a whole lot less terrifying. Because here's the thing if you look at what your options are it's really a whole lot

less terrifying because here's the option i go to work at my current job and i give it all to the daycare that's that's a zero sum well that's not appealing so you've already ruled that one out right i can stay home and that's still a zero sum so any money you make with this idea is gravy on the biscuit you got nothing but upside kid nothing it's all up it's all gravy and so anything you do is going to be right that's good that's a good position to be in. Financially, every dollar you make is going to be more than you would have had versus sitting on your butt or versus working and giving it all the daycare. So any money you make is found money. It's extra money for the family. So it's awesome.

And you can work around your child's napping and you can work around some of the precious moments you're going to have at home for the first two or three years with that baby and those kinds of things and uh but yeah as far as the the fear part you don't have a lot to be afraid of on the financial side and then that kind of relieves you uh releases you to say to put yourself out there and go well if i don't want to do it it's okay right i'm gonna be okay i'm okay you know it's just it's not it's not like it's i'm gonna die if I don't get clients. You don't have that situation. You don't. It's just because that's what the voices say in your head.

Yeah. And it's interesting because fear is this elusive thing. It's this dark shadow that's always like you never pin it down, so it's always haunting you. If I ask people a lot of times, Dave, what are you afraid of? It's hard to identify. I don't know. I'm just scared. Yeah.

Well, the job she's got now, she's a graphic designer. Okay. So she goes to work and someone else either brought the business in to do the graphic designing or she's doing it for that company. One of the two. Okay. So she doesn't have to go get clients. Right.

So going and getting clients is a new fearful experience. Sure. But the good news is if you really are bad at it, you're still going to be okay. You're fine either way. That takes some of the fear out of it. So just have some fun with it. You're all right. Ride the roller coaster.

Woo-hoo! That puts this hour of The Dave Ramsey Show. This episode is over, but if you heard about an event, product, or service and didn't have a chance to write it down, don't worry. We list everything you've heard about during this episode in the podcast show notes or head to DaveRamsey.com. Thanks for listening. Hey folks, there's literally never been a better time to try online grocery. My friends at eMeals make it incredibly easy for you. eMeals creates a shopping list based on the meals you want for the week and then directly sends it to walmart kroger

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