The Ramsey Show - App - Ego Makes You Live a Lifestyle You Can't Afford (Hour 3)

Episode Date: April 11, 2019

The show about you

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. It's a free call at 888-825-5225. April starts off this hour in Nashville. Hi, April. How are you? Hey, Dave. I'm great. Thank you so much for taking my call. My pleasure. How can I help? Well, we have an interesting situation with our housing and schooling. And every time I ask somebody for advice on it,

they're like, well, I don't know the best decision. And finally my mom goes, April, what would Dave say? And I said, I have no idea. So I thought I'd call you. We're trying to decide if we should stay in a house that is paid off, that we rent, that we can live in for as long as we want to. At some point the rent would go down to nearly nothing or move to an area that has better

schools. And the reason where the rent would be twice as much as we pay now. And the reason there's even a question is because our children are currently in private schools, and that private school is going to cost us in upwards of $150,000 over the next seven years. So I feel like we're giving up on this house that will be $250 a month in the future in order to pay for this private school. Or we can rent in an area that's better with better public schools so i'm not sure how else to ask a question that's okay um so you're spending

twenty thousand dollars a year you're spending twenty thousand dollars a year average on public schools in order in order to save how much rent? I mean, all private schools. Well, right now, yeah, right now we pay about $1,000 a month where we live. And what would it be if you moved? $2,000. Okay, so that's $12,000 a year. Right. Difference.

It's a lateral move. No, it's not. It's an $8,000 benefit to move. Well, okay, yeah, I agree. What in the world is the deal with the house you're in? Is some relative on it? Yes, it's my mother-in-law's home. She has moved into an independent living facility, and we can stay in the house forever, but we supplement her income so that she can't. Who will get the house forever, but we supplement her income.

Who will get the house when she dies? It's part of the estate for eight children. Eight children. Yeah. Move. That's what I thought. Yeah. You're $8,000 better off when you move,

and the public schools you're moving to are obviously acceptable, good neighborhood, good schools. Right. Right? Right. And they're not unsafe, and they're not lacking in whatever. And here's the question. Here's the other thing. Here's the other thing.

You ask yourself the question, where do I want to be in 10 years, and which of these ways takes me there the best? And where you want to be in 10 years is you want to be owning a home in the school district where your kids want to go to school. Well, the kids will be gone at that point. Well, that's true. Okay, that's true. But you want to be owning a home in that neighborhood, not the one you're living in. Right. And so go rent something.

$2,000 a month is pretty steep, but go rent something as cheap as you can. It's south of your office. Okay. We want to move to Franklin. Yeah, you're an expensive neighborhood then. So Williamson County schools are great. My kids went to Williamson County schools. They're the top school system in the state as far as scores and everything go and and solid you know uh safe you know schools and so

yeah we did the same thing we took our kids out of public out of private when they were little and moved to williamson county and rented so we did the exact same thing we have an incoming freshman so this would be a transition for him. Well, that's a different discussion. But you call me talking about $12,000 a year out of pocket versus $20,000 a year out of pocket versus living in a house you don't really care about just because it's a mother-in-law's house. And, you know, I'm moving to Franklin if I'm in your shoes. And I'm going to start saving to buy a house while you're doing this.

And, you know, make sure you're out of debt, get the cheapest possible rent you can in the area, and so forth. And, you know, that's the way to go. You can certainly spend more than that in that area in rent. That's an expensive place to live. But you can also poke around and spend less than that. I own some properties in that area that are less than that on rental, and I own some that are more than that. So, hey, I'm gone if I'm you. William is in

Winston-Salem. Hi, William. How are you? I'm good, sir. How are you? Better than I deserve. What's up? Well, I got two questions if you got the time. The first question is, I've been a very, very good saver, so I've got a significant amount of money

in a non-retirement account, and now I have two little ones. I've got a three-year-old and a six-month-old. Yay! How much is a significant amount of money? $300,000. That's significant! Well done! And I don't mean, like I say,

I'm a good saver. My salary is just like $40,000. So the problem I'm getting into is that I'm getting taxed, you know, on all the capital gains and dividends that I get from that, even though I'm just having to, you know, keep rebuying, but I'm still getting taxed on it. So I'm just wondering, could I take a chunk of that and kind of fully fund 2529 accounts?

Yes. You would? Yeah, put it in good mutual funds, and it'll grow completely tax-free for the babies. a chunk of that in kind of fully-funded 2529 accounts to your wood. Yeah, put it in good mutual funds, and it'll grow completely tax-free for the babies. You put in $10,000 a year for most of them. Pick a 529 where you control the investment. You're putting money into the investment, and it doesn't move unless you move it inside the 529, and you put in $10,000 this year, $10,000 next year for each kid, that's $20,000 each, so about $40,000 of it, I would move that way.

And if you've got any debt, like your mortgage, I'd pay it off. You've got a big chunk of money laying there. If you've got any debt at all, clean um and rather than sit there and and have that money in a non-retirement um and of course all of that's going to enable you to turn around and save even more uh which is a great thing if you don't own a home or uh you know or you have a mortgage on a home use some of that money to get a home that's paid for uh and move in that direction. You're doing really well. Congratulations. Absolutely amazing.

Very well done. Tanya's on Facebook. Dave, want to know if I buy term life insurance now at affordable rates, won't I face the chance of paying more when the term is over? I don't want a whole life policy because it's permanent and locks in, or don't I want a whole life policy because it's permanent and locks in right now. Yeah, let's get screwed and lock that in. That's what a whole life is.

A whole life is 20 times more expensive than term for the same amount. Let's be sure we lock that in. That's stupid. I'm going to pay 20 times more and be sure I lock it in so that I can lock it in. That's just dumb. Now, buy term insurance, 15 to 20-year level term. During that time, get your house paid off, build up your investments, get your other debts paid off, raise your kids so they leave.

During the 20 years, they are grown and gone. Your house is paid off because you take a 15-year or less, and you build up $700,000, $800,000 in mutual funds. He dies. I think you're okay. So you don't need insurance if you're not broke. If you build up a big pile of money and no debt and the kids are grown and gone, your need for insurance goes away.

It's called self-insured from financial planning. No, never buy whole life life insurance. It's the payday lender of the middle class. The last thing I want you to feel is buyer's remorse, especially when you offered thousands more on a new home to win a bidding war. If I've taught you anything, it's that blindly throwing money at a problem is a stupid plan and something you'll regret for years. The key to avoiding this rookie mistake is to call Churchill Mortgage and get certified. This easy program puts you miles ahead of your competition because you are pre-underwritten.

Your interest rate is secured, and yes, you can close within 14 days. Don't fall into the trap of offering more money just to compensate for a poor plan. Call Churchill Mortgage today and get certified. Call 888-LOAN-200 or visit churchillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLSconsumeraccess.org. Equal housing lender.

761 Old Hickory Boulevard, Brentwood, Tennessee 37027. Carly is with us in Salt Lake City. Hey, Carly, welcome to the Dave Ramsey Show. Hi, Dave, how's it going? Better than I deserve. What's up? Okay, so I just have a couple questions. So my husband and I are trying to decide whether we should invest and continue renting the current apartment that we are renting, or if we should purchase a house. Okay, and you're debt-free other than that.

You're debt-free. Yep, that's correct. I'm sorry, are you debt-free? Yes, yes we are. Okay, and do you have your emergency fund saved of three to six months of expenses? Okay, good. Well, this is the point at which people decide, are they going to save up a down payment for a house,

or are they going to save up to pay cash for a house? What's your household income? Currently it's about $60,000 a year. Okay, and what price range home would you be saving for? We're probably looking at somewhere around $300,000 to $350,000. Okay. All right. And so if you saved $30,000 a year out of $65,000 towards a house, it would take you 10 years. Okay.

Right? Or if you saved up a down payment and bought a home on a 15-year mortgage, that's the one thing we don't yell at people about. That's the one kind of debt we don't yell at people about is a 15-year fixed-rate mortgage where the payments are no more than a fourth of your take-home pay. I think that $300,000 house might actually be above that number on a $60,000 income. So that might not work. You may be buying a little less house coming out, but it's your first house,

so that's not a problem to buy less than $350,000 in Salt Lake City for sure. That's a pretty nice home there. Well, he's doing school too, so he's almost done with school, so he should be able to be bringing more. Right now I'm the provider, so he'll be able to bring more in the next. When does he graduate and what will he make? So he'll have his undergrad at the end of this fall, and then he has his master's program that will start the following fall

and be one year long. And what is he studying? Accounting. Okay, all right. Yeah, so your household income is probably going to double at the point that he gets through with that, right out of the gate, if not a little more. Okay.

And so at that point, you could save a lot very aggressively, and you probably save up and pay cash for a house in three or four years after he graduates. But if you're paying cash for all of his education. That's correct. We've already got it all set aside. So the master is going to cost about $30,000, and we've got that saved already to go. Well done. Good job.

I'm proud of you guys. That's very well done. Okay. Well, the whole thing is this. It's just a matter of whether you want to buy something now that's a little less expensive and you save up that down payment above his tuition cost and above your emergency fund, put it on 15-year fixed, or whether you want to wait until after he graduates and do something a little different.

Either one is fine. There's not a real wrong answer here. As long as you don't just jump out here and buy too much house or you're not buying a house for the wrong reasons, and that's usually panic and fear and, oh, I've got to get a house and all this kind of stuff. People just go crazy about owning a house. And owning a house is a good thing as a part of your long-term plan. Doing it wrong is a bad thing. It'll set you back and, you know, it costs you a decade of your life to buy a house is a good thing as a part of your long-term plan. Doing it wrong is a bad thing.

It'll set you back and, you know, it'll cost you a decade of your life to buy a house wrong because it's a huge mistake. You never make little mistakes with housing. So just keep it super conservative. Put down a good, strong down payment and, again, a 15-year fixed where the payment's no more than a fourth of your take-home pay. And you can apply that formula before or after graduation. Obviously, it will change before graduation what you purchase.

Katrina is on the line in Phoenix. Hi, Katrina. How are you? I'm doing well. How are you, Dave? Better than I deserve. How can I help? I was calling.

So me and my husband were recently married. We became debt-free prior to us actually getting engaged, and we just completed baby step number three. Yay! I know. So my question for you is each of us actually bought a home prior to us ever actually meeting and dating and getting married. Cool.

And so we're not sure if we should keep both homes or should we sell one and pay down the other? Which one are you living in? We live in the one that I bought. so what are you renting his um currently it's sitting empty we just got married like two months ago okay all right we've not been in a hurry to do anything with it uh how much do you owe on your present home the one you're living in we owe about 210 what about the other one and we owe about 125 okay and what's your household income it's about 190 i just got a raise so it's either between 190 to 200 wow

look at you guys what do y'all do for a living um i'm a pa and my husband works as a buyer for a company that remanufactures um office furniture Great. Very well done. Okay, cool. Well, you guys are killing it. Congratulations on the income side of the equation. So what I would do is just lay it out and say, how fast can I pay both of these off, my primary first and then the other one? And am I willing to wait that long? What is that?

Wait a minute. What's his old house worth? So his house is worth about $220,000. And so you can pull $100 a hundred out of that and throw it at yours and have yours paid for in about a year and a half two years correct well mine's worth about 360 i know but you could pay the one you're living in is yours right yeah correct okay so he you said you owe 120 on the old one and it's worth about 220 you got about 100 000 equity in his old one right correct yeah so if you sold it, throw that at your $210,000 mortgage, take your $190,000 income.

We're just about clearing your home in a year and a half or so. So that's one possible equation, okay? Okay. The second equation is it takes three years to pay yours off and another two years to pay that other one off, which is not a bad plan. You've got a paid-for rental and a paid-for home in five years. Yeah, that's kind of what we're leaning towards, but we go back and forth, and we're like, what would Dave do in this situation?

Yeah, I think I would be on the bubble because I love real estate, but I don't want your plan for rental real estate to be in debt the rest of your life and keep borrowing money to buy rental real estate and all that kind of a thing. So the goal is, can we knock these two things out? And the good news is you make a lot of money. So if you will apply that mathematics to that in a very real way, I'm not saying you can never go on vacation, but you guys really need to lean in hard and say, okay, we really have about $350,000 here in two mortgages, and I'd really like to pay all of that off in five years out of a 190 income.

That's pretty doable. Yeah, we're definitely thinking about hopefully four years, actually. Yeah, there you go. See, that kind of a plan is very reasonable. Because if you sold his house and applied it to yours, then you're pretty quick going to start piling up cash to buy a rental paid for. And on the backside of four years, you're going to be buying a paid-for rental anyway. And if his is a good rental, you might as well just keep it and plow on through this. Yeah, his is a good rental, actually.

Then get some renters in it. Okay. It's been sitting there empty two months. Time to rent it. And let's just lean into yours first and the one you're living in, and then we'll lean into that one, put it on a four- to a five-year plan. Every time you get a raise, you'll be on your every-dollar budget. You know, we've got a goal here.

It's not beans and rice, rice and beans. You're past that level, but you're being very intentional and very focused with this fabulous income God has blessed you with. And you're going to take that to do all kinds of good things for not only your family but for a lot of other people as well. Amy's on the line in Pittsburgh. Hey, Amy, what's up? Hey, Dave, I think you're hilarious. Thanks. How can I help?

Okay, so my husband and I do the baby steps sort of out of order. And I know you're going to yell. Well, then that would not be the baby steps. That would be you made up your own plan. Yeah, pretty much yeah we're italian i mean you know that's not that's that's what it's what causes it is you're italian okay i got that blame it on that why not let's just blame it on that i mean babe i can have you on the phone for an hour. I grew up a bookie's daughter. I love it. I mean.

I love it. How can I help before I run out of time? What's your question? Yes. Very quickly. So we need a different car because my husband's car is only three years old and it keeps breaking. So instead of sinking money into the car to get another repair, I'm like, this is ridiculous. Let's just get a different one.

So we own his car, so I'll just put a number on it. Say the car is worth $15,000. Do we take the $15,000 and leave it in a savings, like a quick money market, or do we put the $15,000 towards the new car? You buy another car for $15,000 or less. You don't go into debt. But, of course, you're doing your own plan. We have to keep that in mind. You're Italian, so I don't know what the heck you're going to do.

But if you're calling to ask my opinion, which is, I thought, what we were doing, yeah, you just pay cash for your next car, kiddo. to do but if you're calling to ask my opinion which is i thought what we were doing yeah you just pay cash for your next car kiddo like buy a twelve thousand dollar car put three thousand towards your other debts that's a new one 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 In the lobby of Ramsey Solutions, Jennifer is with us. Hi, Jennifer.

How are you? Hi. How are you? Better than I deserve. Welcome. Thank you. Thank you. Where are you from?

I'm from Chicago. Cool. Welcome. Good to have you. Thank you. Where are you from? I'm from Chicago. Cool. Welcome. Good to have you. And how much debt have you paid off? So I paid off $42,944 in two years. Good for you. And your income range during that two years?

It started like $75,000 and then it's like $80-something thousand. Okay. I went to blank, like $83,000. Okay. Good. Very good. What do you do for a living i'm a middle school bilingual math teacher oh very good yes way to go what kind of debt was the 43

um so it was credit card debt um some personal loans uh which was just money to borrow to buy clothes and stuff um a car that i had to turn in because it had depreciated so much when I got laid off as a teacher. And so I had to pay for a car loan that I no longer drive. And student loans that I had to take in order to try to become a teacher again to go back to school. Okay. Wow.

Good for you. What happened to you two years ago that put you on this journey? So I was laid off as a teacher. There were like 2,000 teachers that were laid off. Wow. And three years in a row being laid off because around this time is when teachers find out if they're going to return. It's very stressful. And so in losing the position, I had to work as a makeup artist at a local mall.

And turning in the car was the beginning of the debt. And then I thought, well, I'll open up credit cards to help pay rent and things with the intention of getting a teaching job and paying it off. And it didn't work out that way. And also I think my ego, I wasn't ready to let people know that I was laid off. And so I think I was still living the lifestyle that I no longer could afford. And so I heard your name, and I didn't do anything about it, and then I saw it at a church, and I took the course. Oh.

And since then, at my church, I've led it three times. Okay. Yes. Thank you. Very good. You've changed my life. I appreciate everything you've done. Wow, look at you.

Thank you for teaching me. Very cool. Yes. Good. So you're teaching me. Very cool. Yes. Good. So you're now an FPU coordinator. Yes. And so I did everything you said. You said you have no business being at a restaurant unless you work at one.

So I had a weekend job at a restaurant. I found a restaurant that would allow me to work just Friday and Saturday. And then I did tutoring after school. Anything I could to pay off the debt. I also, with Mickey, I ordered the Dave Ramsey for the middle school students and I taught my students. And it turns out one of my students told me that her dad was getting out of debt because of the stories I was sharing with them. Wow. Yeah. And so I learned how to sew my clothes. I wasn't buying new clothes.

Someone from the church donated food for me. Someone gave me cash. People would take me out. I feel like when you make the steps to get out of debt, God will meet you where you're at. He will provide in ways that I never could imagine. I would pray to him all the time, like, Lord, please have someone bail me out.

I meant money, but he had people bail me out with food. Or someone shared my story with their friend, and that person was going to give clothes to the Salvation Army. Instead, she came to my house and let me take all the clothes I wanted out of her car. We were the same size, so that sustained me. Yeah, so it was amazing. And the restaurant would feed me, and the cafeteria workers would feed me at lunch. So it was at school.

So there were ways for me to. Once you set your mind to it. Yes. So getting laid off scared you to death. It did. You wandered into the Financial Peace University class. Yes. And then you got fired up.

Man, you were on fire. Yes. You were going for it. Yes. And I used to always borrow money from my dad, but I would hear you and you said, nobody, you cannot borrow any more money. And I cried a lot at the beginning of the class, like, how am I going to come up with $1,000 and how am I going to do this?

But my dad would support me and say, you can do this. And I did it. And it felt so incredible. And my friends were encouraging me. And I would listen to your podcast all the time at the gym. And especially when single people would come on and share their story, it encouraged me because I'm single. And so if they can do it, I can do it. And the other thing I wanted to share is I heard a lot of your past callers saying they didn't socialize.

But I still socialize. I just didn't eat out. I would have food in my purse. The only thing we did, I did cheap things. Like if there was the White Sox, sorry, the games are really cheap. So they were $11. I could do that. But I went bowling, but I didn't bowl.

I went out to brunch with my friends, but I didn't eat out. So I still socialized with my friends, and they were supportive. They would come over to my house and eat instead of eating at a restaurant. So it was awesome. What a great journey. Well done. Thank you. Well done.

So you got on fire. When you went into that class, you said I cried a lot at first. I did. What clicked? that class you said i cried a lot at first what clicked what was it you were learning while you're going through financial peace university that clicked and made you go i think i can do this i think um i loved your humor but also when you were serious you but there was a lot of empathy in your the way you delivered and that meant a lot to me that you had been there too, and you weren't coming from a place of judgment. And so it was done. There was nothing I could do

about my decisions. I had to reflect, why did I get in this position? And it was because I thought I had it all. I had the house and the car and everything, but I was a paycheck to paycheck person. And I thought I was living the dream. But when you said financial peace, I realized I never had that. And so I wanted to change my life also for my niece and nephew. I bought them the kits, and I've taught my nephew as much as I could. This really ended up being a spiritual journey for you. Oh, yeah.

And the Lord humbled me. I felt like, um, there was so much he gave me before that I didn't appreciate. And now I know he'll give it to me again and I will appreciate it. And I, I also want to say I tied through the whole thing. That was very important to me that I knew that everything I have is because of him. And so, um, I knew that, uh, if we went on strike, it didn't matter because if I received less money, so would he. And if he was okay with that, then I was okay with that. And so I just had a trust that things would work out. And I feel that because I trusted in him, he moved it along so much faster than I thought.

And he provided support along the way. And also helping lead the classes kept me going as well because I would hear things a second time or a third time that I didn't hear the first time I took it as a participant. And now I'm going to be doing in the fall the Smart Money, Smart Kids. Oh, very cool. I'm going to be volunteering with my church as well. Hey, thank you. Wow, you are something else. Well done, well done.

So the key to getting out of debt is what? Is you have to follow the steps, I feel. You have to say, I'm going to do it. You have to say for a short season, you are going to sacrifice. You're not going to eat out. You're not going to buy clothes. But it's going to make a difference when you combine in cash. And I found that all of a sudden having cash, it's such a rare thing.

People would ask me questions and I would share. And I think that just knowing the reward, for example, I'm on step three right now, but I also, in addition, after step three, I want to save for a used Lexus. And that feels very difficult, but it'll be the first thing I've ever done in cash, buying a used car. It's going to be like a 2000, 2001, but it's going to be a Lexus. But in cash, that's going to be huge for me. You've got it in HD.

You've got it dialed in exactly what you want. Yeah. Way to go. Thank you. I'm so proud of you. I know your dad is. Yeah, he is. And the other thing, my students were supportive.

They would make me bar graphs because they're really good artists, and I would shade with them. And we would have little celebrations at lunch if i said i paid off another one and um and so when i became debt free we had a lunch party and a dance party combined and it was so great that they um supported just there was one particular class out of four classes that really got it i'll remember that forever yeah and yes we've got a copy of chris hogan's book for you retire inspired that's the next chapter where you're millionaire and you continue your outrageous generosity. And thank you.

Thank you so much for leading the classes. Oh, thank you. Great story. Thank you. Very well done. Thank you. Very well done. Jennifer from Chicago, $43,000 paid off in two years, making $75,000 to $83,000.

Count it down. Let's hear a debt-free scream. Three, two, one. I'm debt-free. Love it. Love it. Well done. Man, that is fabulous stuff.

This is The Dave Ramsey Show. our scripture today is proverbs 27 17 iron sharpens iron and one man sharpens another. Kareem Abdul-Jabbar said, One man can be a crucial ingredient on a team, but one man cannot make a team. Weston is in Salt Lake City. Hi, Weston. Welcome to the Dave Ramsey Show. Thanks for having me, Dave. I appreciate your time. Sure. What's up? I'm currently on baby step six, and my wife and I are wondering if we should downsize our house. We currently have a home

value of $345,000. We only owe about $200,000. We're at a 20-year, 3.25% interest rate, and we have about 3,100 square feet. We originally bought this house three years ago because I had a roommate that moved in with us. We no longer have a roommate, and we don't even use the bottom half of the house. Would it be a good idea for us to downgrade? Well, if you want to downgrade regardless of financial reasons, you can, just because you don't want a big house. There's nothing wrong with that.

Do you need to downgrade for financial reasons? How much is your house payment? Our house payment right now is $1,380 a month. And what's your take on it? Our income is about $4,700 to $5,000 a month, $4,700 to $5,000. Okay. There's no reason, based on the financials, that you would have to move down. No, no.

We're just wondering if it's a smart idea. I mean, our interest rate would go up to, I guess, 3.75? Yeah, the interest rate's irrelevant here because the cash flow is more important. The question is, where do you want to live? This house is not out of your range financially. You're okay. You're going to be okay in this house. This house is not killing you financially.

Oh, no. We're done with baby steps one, two, and three. We actually took baby step three out a little further. So why is it you're wanting to move? Just because we don't use the bottom half of the house. It's more of a half of the clean than it is to keep. Okay, then that's just a personal decision. I just don't like my house.

And does your wife feel the same way? This is the house that my wife actually, or the house that she chose. She actually liked the house, and then she just didn't care either way. It doesn't bother her if we move and find something smaller or if we stay. We're just wondering if the financials were better for us to reduce our house. No, the financials are not a problem. No, you're over-nerding this. The financials are okay.

You're fine on your math. The only question is just where you want to live. Lloyd is with us in Atlanta, Georgia. Hi, Lloyd. How are you? I'm doing all right, Dave. How are you? Better than I deserve.

What's up? I'm sorry. I just wanted to ask you a quick question. I'm one of those adults who are living with their parents forever. I'm 28 years old. Finally got my butt in gear and graduated from college. Good for you. I have a girlfriend.

Thank you, sir. Thank you. I have a girlfriend now, and I found your book during the three months that I was unemployed. I've been working here for a month for $13 an hour, but I just got a call that I'm going to be working for $43,000 now. My next job, I start next week. So I wanted to know, where in the baby steps can I include making plans to propose to her, say, for the ring and say, for the wedding? Sooner rather than later.

The thing is, if you're going, you've got, you have debt, I assume. Oh, yes, sir. How much? Student loans is $23,8 and thirty four okay is that all no car payment oh no no car payment no car payment but i have 65 in uh medical bills and i have two thousand in consumer debt which i'm wiping out with my tax return once it comes here good for you okay so you got a new job and you got a new plan life is good you're heading in the right direction, Lloyd.

The only thing is this. Who's going to pay for the wedding? It will probably be me and her. Okay. All right. So you don't have a lot of money for a wedding, and you don't have a lot of money for a ring. So as long as you guys are willing to do a wedding on a budget and a ring on a budget, meaning pay cash for the ring and limit that purchase.

You don't need to be buying a $5,000 ring. You're just now getting started on your plan, you know. So you're buying a less expensive ring, but that's okay. There's no correlation between ring size and marriage success anyway. And so you just get an inexpensive ring and do the proposal, and then we do an inexpensive wedding. And you can do that while you're working your other stuff. But you don't need a $20,000 wedding with the numbers you're giving me. You need a $7,000 to a $10,000 wedding with the numbers you're giving me.

Okay. And what budget would you propose for the rent? Well, never more than a month's income, and that's even if you've got all the money. So, you know, I'm thinking probably in your situation maybe a grand or so. Well, never more than a month's income, and that's even if you've got all the money. So, you know, I'm thinking probably in your situation maybe a grand or so. All right. Dave, thank you very much. Your ministry has definitely moved me in the right direction.

I really appreciate it. Well, I'm honored. I'm proud of you. You're doing it. You've got some really good traction here in a bunch of areas of your life all at the same time. Things are turning around for you, brother. That's good. If I can help further, you can call me any time. Things are turning around for you, brother. That's good. If I can help further, you call me anytime. David is on the line in San Antonio.

Hi, David. How are you? Good. Thank you. Good. How can I help? So I'm just getting frustrated on getting started. My wife and I don't see eye to eye on finances ever,

and she's always done the finances. I've never said anything to her about it, and now that I'm figuring out how much we have in debt and we have a hundred thousand in debt yeah that's not including a hundred and seventy thousand dollar home and she thinks the budget's silly she thinks the snowballs silly uh so mean, it's just almost impossible to get started. I have money in an emergency fund. You know, I try to pay stuff off, and I know it's just difficult getting started.

Okay. Well, I'm confused as to why she thinks the idea of being out of debt or the idea of having a plan is silly. I don't know. I couldn't tell you.

We're both college educated, and I don't know. I've always let her pay the bills. Well, she's handled the money, and you're $100,000 in debt. That sounds more silly than having a budget. That's what I said. Yeah. But it comes off as, you know hey this is a personal attack on how i'm doing stuff which it's not you know hey we need to get out of this yeah yeah and

uh yeah i think um probably the first thing is is that you owe her an apology for all the years of you not helping her with this subject and leaving it on her to make the decisions by herself and then just couch it. And this is not a personal attack, but I'm just very interested in helping now, and I want us to work together. And, you know, if you guys can't work together on your life goals, you don't have a financial problem, you have a marriage problem. But it could just be your approach is lousy, that you're being a bull in a china shop, and you may just need to sit down and start talking about, I really am so excited about

where we would be if we didn't have any debt. And the only way I know how to get out of debt is to have a plan to get out of debt. What do you think? You think we ought to stay in debt? You think this $100,000 is working for us? I mean, you know, and just start talking to her like that. And instead of start throwing what we're going to do, what we're going to do, what we're going to do, let's talk about why we're doing stuff and why you're excited about it.

And, you know, does that not make sense to you? And then back into the what. But a lot of times, guys, in particular, we start with the what and not the why. And that's the thing. So, you know, do that and maybe go through Financial Peace University together. That might be a way to do it. So check in. You know, hold on, and I'll have Kelly pick up,

and we'll give you a Financial Peace University membership. And I'm not going to give it to you if you can't get her to go. But if you can get her to go, because you don't want to go without her. It'll cause a divorce. It'll cause it to be worse because you'll get more excited, and she'll be less excited. But if you can get her to go to the group with you, I will give you the program. It's called Financial Peace University. It's only nine weeks.

You go once a week for nine weeks to the group, and then you've got a year access to every dollar and every dollar plus. And, you know, that's what you do there. So hold on. I'll have Kelly pick up, and maybe if you can get her to do that, that might be a way to get you guys on the same page. And maybe she can start to understand why you're excited about this not just what you're trying to do there is a difference so hey thank you for the call man hold on kelly

a pickup that puts this hour of the dave ramsey show in the books we will be back with you before you know it in the meantime remember there is ultimately only one way to financial peace and that's to walk daily with the Prince of Peace, Christ Jesus. make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.