The Ramsey Show - App - Face Your Financial Challenges Head On (Don’t Let Them Sneak Up on You)

Episode Date: August 7, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Walsh, our number one best-selling author, Ramsey Personalities, my co-host today. Open phones at 888-825-5225. You jump in, we'll talk about your life and your money. Kurt starts us in New Jersey. Hey, Kurt, what's up? Hi, how's it going, Dave? Better than I deserve, man.

How can I help? I have a little bit of a business question. So I have 57K in personal debt. I started my business less than a year ago. I've been pulling out everything that I make from the business, all my profits, in order to pay off my personal debt. I have no business debt. I was just kind of wondering, I feel like I'm not able to grow the business because I don't have retained earnings. I don't feel comfortable hiring

somebody without retained earnings. And I was wondering too, if I should keep some retained earnings just to maintain overhead, what would you suggest in terms of how I should go about that? Yeah, I would. I would. How much have you pulled out of the business in a year? What are you making? So year to date, I made about 80K. I would say my profit margin is about 80%. Good for you. I've been pulling out everything. A little bit of a tidbit too is I have a four week old right now oh wow that's fun congratulations what what kind of business did you open uh physical therapy i'm a physical therapist good for you yeah okay what we teach in entree leadership is that you pay yourself a living wage or you pay yourself a salary an

amount that you're comfortable with that you can make progress on the the goals at home which would include debt um you don't have any debt at the business so you could just say i'm going to take a percentage of profit 10 15 20 something like that and every month and hold that as retained earnings and take everything else home. And that way your retained earnings grow as fast as your – they grow as a percentage of profits. So as your profits grow, your retained earnings grow. Okay. Yeah, that makes me feel a lot more comfortable then.

I mean, if you had $8,000 laying over there because you did 10% or you had $16,000 laying over there because you did 20%, you'd be in really, really good shape. Yeah, but it's definitely more than the $1,000 that I would keep in for the security fund. Exactly. This is the different formula because it's business that we're dealing with. But yeah, that's what we teach Entree leaders. It's what we do at Ramsey. And we laughingly call it the Sharon Fund because I was draining everything out of here and then griping about cash flow problems all the time. And Sharon's like, well, you're not even doing what you teach. You don't have

an emergency fund. You goober, you're a hypocrite. And I'm like, oh, God, she's right again. So we call it the Sharon Fund when we first started doing it. And so, you know, it's it's we've been taking a percentage of profits from day from the day that I discovered that my wife was brilliant in a home. So, yeah. Well, when Sam and I started our business, it was a similar thing we had. We still had about $240,000 that we were paying off. And I mean, we drained all the profit to pay it off.

And the most painful part was, you know, you're taking this payroll and then you're turning around paying taxes on it. And then you're using it to pay off all this debt and but for us it felt a little different because it was just the two of us at the time we had very low overhead there wasn't a lot of risk involved and so yeah and make sure whatever you're taking home that you're withholding on it so you can do your quarterly estimates you don't want to get behind with the kgb i mean the irs yeah no yeah yeah definitely yeah okay so as long as you're doing that yeah i just take pick a percentage i don't care my recommendation would be 10 to 20 somewhere in that range of net profits and each

month when you close your books go boom gonna set that aside over here take everything else home and attack the 57 and get done with it and you know be able to buy diapers for the four-week-old everything works very cool good stuff man congratulations sound like you got it going i'm proud of you alan's in fort worth hey alan how are you oh i'm doing well sir thank you so much for taking my call sure how can we help well so uh here's a detail um so my wife and i were in baby step two and uh we're just trying to figure out one. Does it make sense to pause baby step two in order to save for a beater car? Uh, yeah. What are you talking about? Why you don't have a car or what's the situation?

So the situation is, uh, we're, I have a car now got a big, well, not a big loan on it. It's $24,000. And, you know, we're, I guess we're trying to do the whole gazelle intense thing. And I'm just thinking, well, Oh, if you got a beater, you'd sell the 24. Yes, sir. Okay. What's your household? Well, uh, so all said, uh, so about 6,000 months from my primary job. I have a secondary job. I get maybe $500 a month in VA disability. So around $7,500 a month as my take-home. Okay. All right. And so you have that car, and it's worth, is it worth around the $24,000,

or what's it worth? It is. So it's, I looked at Kelly Blue Book, and right now it looks like it's selling for about $22,500. Okay, what's the other car? That's it. That's all. I mean, that's my car. You have one car? I'm sorry, we have another car.

What's the other car? Honda Civic. Okay, what's it worth? Well, that one's probably worth $8,000. That's an older car. There's two rules of thumb we use when someone asks this question. Number one, don't have vehicles ever in your life that have motors and wheels, anything with a motor or a wheel, added together that equal more than about half your annual income because you have too much tied up in things going down in value.

Agreed? You're not violating that one. Okay. And the second one is, can we be debt-free everything with the house in around two years? So we know we got 24 in debt. What other debt have you got? About 3,000 credit card debt. That's all the debt.

You like the car. It is a good car. Then pay it off. Okay. You can be debt-free inside of two years. Easy. Probably about 18 months or less. You're making $90,000.

We need to pay off $25,000, $26,000. You can do that. Okay. Yeah, I agree. So you can do it inside of two years, and the total is less than half your annual income. That's the two tests that we use, the test if you will to do that and folks let me i tell you that's not a um biblical thing in terms of it's not in the bible because yeah um i mean the only thing that's in the bible is the honda accord because jesus said they were all in one

accord but um but other none of the rest of them are in the bible so you just add it all up and uh the problem is that we all in america love cars uh some people love cars because they're redneck like me and they want a muffler some people like a battery called a tesla some people like like rachel and george they want to catch fire to themselves and um and then some people like my wife likes a nice car because she thinks it's a large purse. And so but that, you know, we like cars in America and the stupid things go down in value. And when you take 60 or 70 thousand dollars and you turn it into ten thousand dollars, this is not a wealth building methodology. And it's the largest thing americans buy that goes down in value because you are what you drive in america it's such an identity piece and man it's um

i never thought about that george is a battery you are what you drive yeah i'm a loud muffler so who knew that's funny yeah but the uh um my neighbor said they guess i know when you go to work so how do you know when i go to work he goes i can hear it you're so that's who i'm hearing driving driving down the road oh my gosh good to know uh once a redneck always a redneck, always a redneck. This is the Ramsey Show. Statistics show that half of Americans don't have enough life insurance, or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family?

They think they're not going to die or something? Well, I used to be one of those guys. I didn't even think about it, and one of my buddies said, Hey, the only reason to not have life insurance is if you hate your wife and kids. And I immediately went and got term life insurance. That's a gut punch. For decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them. Me too.

They don't know what to do next. You're going to have a crisis here. You know, you got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up, or she's concerned how she's going to eat tomorrow. These are the two options. It's saying I love you to your family, term life insurance. Jeff Zander and the team at Zander Insurance makes it easy and affordable. I've used them personally for 25 years.

They're the only people I trust. Go to Zander.com or call 800-356-4282. Jade Walshaw, Ramsey Personality, is my co-host today. Thank you for joining us, guys. We appreciate you being with us. Hey, the best way to get a sense of power, a sense of dignity, a sense of sustainability with your money is by telling it what to do instead of wondering where it went. It's called a budget. And when you write down or you use every dollar of the budgeting app and have a plan for your money every month, you will feel like you got a raise because you've been wasting so much with disorganization and chaos. Me too. I used to do that too. I know exactly how it feels and i've done

financial coaching and counseling for 35 years and almost and jade has to not for 35 years but she's done a bunch of it and almost every time we sit down with someone jade and they do their budget they have this aha moment like wow i've got some money yeah it's a big deal so check out the every dollar app for your budgeting. It's the world's best budgeting app for sure. It's free in the App Store or Google Play, and you can go to EveryDollar.com and get it there as well. So check it out. We've got tens of millions of people, tens of millions of people using this every day. It's pretty cool. So thank you guys that are using it. We're glad it's helpful to you. That's what we want to be is helpful.

And just, man, pretty incredible. Andrew is with us in Lexington, Kentucky. Hi, Andrew. How are you? Hi, Dave. How are you? Better than I deserve. What's up? Hey, so how do I pay off my debt if a good portion, over half of my income, goes to child support and taxes? How many kids do you have? I have three total. Two are on child support. Well, if you have kids, you do have to pay for them. And so that's just part of, I think that's part of normal life if you have kids in a family same thing with the taxes and so in this case is really just about the math right if you want to go faster usually the solution is you got to bring in more income and more money so what are you bringing in right now uh i i average about gross um probably about

over three but i only bring in probably about um maybe 12 to 15 a month yes 1500 a month okay something's wrong with that because in Kentucky, two children, child support is 25%. Well, I have two from two separate moms. Okay. Oh, so you got 20% each? My daughter, when we went to court and stuff, they did not properly send me paperwork. And the lawyer I had at the time before I found a different lawyer was not in contact with the child support office.

So I ended up missing that court date. So they went for max of what they could, even with my other custody or child support that i have okay um well i mean there's two things we can do here to work on this um understanding that what jade said is proper and i assume you agree with that that you need to pay for your kids there's no question about that but how am i how can i mathematically make this work so there is a legal amount in every state i do not know if it's two children from two different people if it changes it but the max in kentucky is 25 for two kids okay and if you're being charged more than that um you can go back before child services

back before the judge and have it set up properly and so make sure you're getting charged the right amount and that you're doing that willingly and gladly because you're a good man and you want to take care of your kids okay uh but if you've got if you're being overcharged uh because of a screw-up we'll go back and have the screw-up fixed it's not it's not ever it's not chiseled in stone you just got to get back before the judge and go your honor here's what i've got here's my budget help me with this tell me what i'm supposed to do i'm not trying to dodge here but i'm also can't breathe and so i you know i want to sit down and look at that and so you you've got to get back and reset this to what it should legally and, for that matter, morally be. Then the other side of the equation is what Jade said, and let's start talking about how we can increase your income.

What can you do instead of making $3,000 a month to make $6,000 a month? And that may be side hustles. It may be career change. It may be career change. It may be something different. But one of the things we see, Andrew, often it's almost every single debt-free scream that comes in here and is on the stage had an increase in income during the time they're getting out of debt. It's vital because the two things that you can do is you can cut expenses or and you can increase your income. So there comes a point where you can only cut expenses so much.

And then you say, okay, what else can I do? And then it's, okay, I'm increasing my income. I'm picking up a side hustle. I'm taking overtime. Anything that will pay me that is legal and moral, I'm going to do that to get money. Serious money. Yeah.

I mean, we had a young lady in her 20s that paid off doing a debt-free screen just the other day. Yeah. Were you on with me? Yes. I will never forget. She attended bar. $9,000 a month.

Single mom. Yep. Bartending. Beating alcohol-ism. Yeah. And doing 75 hard at the same time. Yeah. Rockstar.

And $9,000 a month. But she's working 12-hour days at the same time yeah and you know nine thousand dollars a month wait but she's working 12 hour days at the bar you know yeah um and uh that's hard work by the way if you didn't know so um wow so i i'm not i don't know andrew but jade's right there's only two ends of the equation i'd work both of them and that's be paying the proper amount of child support by the law and if you need to do an appearance before the judge in order to get that fixed that's there's nothing wrong with that um and then uh and then increase your income you know lower your expenses increase your income and uh that's what we're doing so good question sir we appreciate you joining us open phones at 888-825-5225 you jump in we'll talk about your life and your money i will tell you

this something he brought up we hear a lot and uh not necessarily exactly the way that he said it or and i don't know his exact situation but here's the thing if you know there is a thing out there coming at you, you have a former landlord that says you owe them money. That's a thing that's laying out there. You have a repossessed car. It's a thing that's laying out there. They're going to come at you. You've got an old credit card from five years ago.

You've not paid it. They've not called you, but you've done nothing about it. It's coming at you. You've got an old credit card from five years ago. You've not paid it. They've not called you, but you've done nothing about it. It's coming at you. You're going through a divorce. Um, and you know, when you go through a divorce, you have children, 100% of the time, there's a child support meeting that's coming at you. When you know these things are coming at you, one of the things I've observed is that if you don't go headlong into it and face it and handle it before it comes to you, it costs you twice as much. If you wait till the former landlord sues you, if you wait till the old credit card pops up, it's going to pop up right about the time you're trying to buy a house or something or about the time you're getting engaged or some other kind of crap.

These things have a high rate of resurrection. They come back to life. These are debt zombies. Yeah. You got to be proactive. And you know, if you don't go find the debt zombie and handle it so don't don't tell me well they didn't tell me about child support dude you knew about child support you'd go down there and fix it 100 instead instead they they jacked you up because you weren't there

yeah you can't wait for somebody else to tell you make sure it was taken care of yeah you've got to wander down there and take care of this stuff boys and girls you know and it's like well i didn't know i didn't know i had a yes you knew you had a credit card debt you did know that you know you weren't that drunk for that long eventually you sobered up and go yeah i ran the balance up on that thing you know i mean you've got you do know it happened and so this stuff it it you know it comes back to life and it's 10x worse than if you had gone and found it and taking care of it yourself don't let these things lay out there in the in in the muck because when they come back to life they're the swamp monster monster and they're they're three times more powerful just you know you've got to face these things head on.

So when you don't take care of business, business will take care of your butt. That's what I'm saying. This is The Ramsey Show. What does the future hold for business? Ask nine experts and you'll get ten different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than

40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities. With one unified business management suite, there's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data.

And when you're closing the books in days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's guide to AI and machine learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. Jade Walsh, our Ramsey personality is my co-host today in the lobby of Ramsey Solutions on the debt street free stage, Kevin and Shaban are with us. Hey guys, how are you? Hi Dave. Hi Dave.

Great. Welcome. Welcome. Where do you guys live? Cincinnati, Ohio. Wow. Welcome to Nashville. And how much debt have you two paid off?

$84,000. Wow. How long did this take? 28 months. Good for you. And your range of income during that time? $158,000 to $200,000. Cool.

What do you all do for a living? I'm in engineering operations. And I am a stay-at-home mom. I homeschool my kids. And I've done some side jobs with just our homeschooling group teaching. Good for you. Well done. What kind of debt was this $84,000?

Dave, it was our house looking at weird people and we were saying that before the political people were saying it i'm just saying all right hey guys way to go congratulations thank you i love it how what's the house worth 475 i love it how old are you two 43 or both 43 43 year old weirdos wow a paid for house how much in your nest egg in your retirement accounts and so forth 625 uh-oh baby steps millionaires too at 43 boom boom look at you how's that feel it's I never thought I would be here it's amazing life-changing. Congratulations. Proud of y'all.

Excellent. So tell us your story. What was your I've had it moment? What turned this whole thing around? How'd you get connected to us? I've been connected to you for about a decade. I think our story starts back in 2007. We were just married.

I was living, we were living up in Detroit area and I was working in the automotive industry. And if you remember 2007, 2008, wasn't a real great time up in Detroit, the company that I worked for was actually sold to a leveraged buyout company. Madeline had just been born in May 3rd. And that was the same day we decided we need to get out of here. And we actually put our house on the market. The day she was born. The day she was born. Oh, yeah. We are out of here. Yes. And the real estate market was awful. It took us five months to sell the house. And I still remember to this day, we had to write a $20,000 check and bring it to closing just to get rid of the house.

And it wiped out our life savings. And we looked at each other. And it wasn't anything we had done wrong, but we just said, we never want to feel like this again. And it was at that point, I was able to get a job in Ohio with, and my parents lived down there and we actually moved in with my parents and lived with our daughter Madeline for the first year just to, just to climb back out. Cause we, everything we'd saved for was, was gone. Everything we'd saved for was gone. And then you end up buying a house and said, but we're going to get it paid off fast yep okay cool and you were connected

to us way back in detroit uh i think i may have started listening to just a little bit but then really got connected once we moved to move down to i probably listened to you for over a decade so for a long time for a long time yes well it worked your baby steps million thank you from from having from being broken living in your daddy's basement yeah oh my god it was actually upstairs it wasn't the basement put him in the basement okay all right either way i got you the attic okay yeah wow congratulations thank you so tell us what does it look like for a lot of people don't believe that you could pay off your mortgage one day right that's not something people talk about every day unless you're here on the ramsey network right so so tell people what does that look like

what what what do you do in order to be able to pay off your mortgage? So it was about a couple years ago, Siobhan, I mean, Madeline is 17 now and she'll be starting college next year. And I think I was just looking at the principal, like the amount. I just started kind of doing the numbers in my math. And I was like, if we really focus on this, we can get this thing paid off. And you had this clarity of thought, like, if we really focus on this, we can get this thing paid off. And it just, just, you had this clarity of thought, like, if we really focus on this, we can get it done. And then you start making the payments and the bonuses and just put it down. It's like, holy cow. It's just unbelievable detraction that you can achieve when you really focus. Yeah, you averaged three or four grand a month for 28 months and you were done. Yes. But there's still that intentionality

of taking the numbers out of the air, right? And putting them on paper, putting them in your every dollar budget. Yes. Wow. Yeah. So I got a feeling, I know who the nerd is in the family. And so you came out of your cave with your spreadsheet and what did your wife say? I think fortunately I listened to you long enough that we dreamed together. We had the why, we have had the why conversation for a long time. We talked about what we want our lives to be like when we're older. And so we had that discussion, the why discussion. We dreamed in high definition, as you said. Early on, we talked about traveling and helping our kids pay for school. And the biggest thing for Siobhan was we had a really challenging time with Madeline when she was little. She had some health issues

and she said, I want to be able to be able to go when my children, my, my grandchildren and just stay with them, whether it's a week or it's a month or whatever it is that they need. I want to have that freedom to be able to go help with my grandchildren. That was her, that was one of her dreams. Yeah. And that's called financial independence, so to speak. It's not, you're not independent. You're actually inter dependent, but yeah. Wow. Way to go, guys. Thank you. Very cool. You guys are heroes.

You go from broke to millionaire in 10 years. I mean, that's pretty incredible. It's just one day. I would say it's also one day at a time, too. And just staying focused on that. And the small things add up, too. And being content and realizing that stuff doesn't make you happy you know the other gift that's hidden inside this story is you've got these beautiful kids over here that are living in your home being homeschooled and they're breathing this air of contentment

they're breathing this air of living on less than we make and uh they're breathing air that's not in other homes and so they can't help but be formed by that and so if they're ever in their own home and they're not it doesn't the air doesn't feel like that then they know something's wrong and so it's you've set a pattern for them more is caught than taught rachel says and she's right. So that's a pretty cool thing. It's a pretty cool parenting. They're going to do what you do. They're not going to do what you say.

So pretty impressive. How do you celebrate? What happens next? Yeah, what's the big celebration? Big celebration is actually Madeline's graduating from high school, so we're actually taking a nine-day Caribbean cruise next May. Yeah, baby! Love that. I like it. Yeah, baby! Love that.

I like it. Yes, we should do that. Absolutely. Yeah, the year she's born, we sell our house at a loss, move into the attic. And the year she graduates, by God, we're going on a cruise. I like it. This is book-ending right here, man. It's perfect.

It's the way it should be. Well done, you guys. Very well done. All right, bring up the kiddos. Let's them all and their uh names and ages please uh malin here is 17 right nicholas is 12 and samuel is 14 all right very good good job you guys proud of y'all and i assume they've been practicing their debt-free scream because their mom and dad are heroes yes they live with weirdos in a debt-free house yep debt-free millionaires at 42 freaking years old amazing shut up this is great i'm so proud of y'all you're just amazing just amazing all right kevin and shabban madeline

samuel and nicholas cincinnati $84,000 paid off. That's their house and everything, making them Baby Steps Millionaires. In 28 months, they paid off the house, making $158,000 to $200,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! Yeah!

Woo-hoo-hoo-hoo! I love it! This 10 to 15-year time span, it was 2007, so I quoted that wrong. It wasn't 10 years, so would be 15 yeah years or so 16 years that took them to turn that it when you say i'm gonna become a millionaire most people think it takes 50 years your whole life yeah and i you know it's gonna take forever and i'm not gonna have a life and be 80 by the time i you know i'm gonna live in a cave and collect lint until I'm 92 and old paper clips and whatever else right it's just like oh god no it's not how it works they're 42 they're

going on a nine-day cruise to celebrate this okay so if you're 27 and you're whining about a little bit of sacrifice, shut up and do the work. I know. Wow. Step up. Seriously. Because 40 is the new 30. I thought 60 was. We could do that too.

Apparently green is a new fashion trend. That's right. You're on trend, Dave. Good job. I had no idea you and I were both dressed to join the Army today. And glasses too. Hey, we're a real team around here. We're more in sync than we realize. Way to go, you guys. We're very proud of you. I've got to give you some of my hair. No. Oh, man, I'm proud of those people. What a neat family. This is The Ramsey Show. There's a time in your life and at the baby steps for renting,

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millionaire. So get started on the American dream of home ownership today at churchhillmortgage.com. That's churchhillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLS ConsumerAccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. Thanks for joining us, America. Jade Walshaw, Ramsey Personality, is my co-host today. Tony's in Chicago. Hi, Tony. Welcome to The Ramsey Show. Hi, Dave. Thanks for having me on the show. Sure. What's up? Well, my mother passed away about 18 months ago. She left me and my brother a paid-off home, currently valued at $450,000. I'm an executor on the house, and I'm trying to make a decision

as to whether to sell the house and have to throw my brother out on the street or let him continue living there. Okay. Well, I assume he doesn't have the money to buy out your half? He does not. Okay. I think it's a little dramatic to say throw him out on the street. He's going to have $200,000 in his pocket when he lands on the street. I feel the same way. Yeah. thousand dollars in his pocket when he lands on the street i feel the same way yeah um so under what on what planet does he think he gets to live there for free indefinitely

well he's been living there for free for about 15 years now he has an anxiety disorder which led him to uh be uh dependent on xanax he does not. His girlfriend pays all his bills. She's been living there for about nine years. She's a disabled vet who works part-time as a nurse. My mother couldn't have the heart to put him out on the street. And then as a Christian, I'm struggling too. You know, what's the right decision? Okay. I'm not sure that supporting or enabling people's inability or unwillingness to deal with their stuff is non-Christian. As a matter of fact, it's non-Christian to enable them to sit in the sewage that we call their life right now. Loving them well would require them to deal with their stuff and build a sustainable life and dignity.

That would be an act of love. Does that sound right? I agree. The definition of Christian is not wimp. It's not doormat. It's kind, but it's also strong, and it's acting in others best interest so what is best for your brother is for him to heal to seek counsel and deal with the anxiety and get off the drugs

and you know you know because the way you stated this, you don't believe that you believe he's escaping reality rather than dealing with and getting better. That's what I heard you saying. Did I miss something? No, I think you're saying it correctly. Yeah. And that's your viewpoint on it. And so if this is my friend or my brother loving them well would be helping them do better in their life not giving them a cocoon to continue to retreat down into a hole

right so that see that's what enabling your mom was an enabler and sweet all enablers are nice people they're all they're the nicest people on the planet because they don't want to do anything that causes conflict or raises an eyebrow so gosh i you know i guess you've got two options one is you do have to deal with this lovingly and help him get better and sit down with him and the parasite that moved in with him. And because he attracted that with his life, that's what his life attracted. And, you know, help them deal with it and help them see a path of what they could do with the money from the house or just deed it to him and walk away. Right.

Which is honestly cowardice. Yeah, do you need the money? It's a lot of money. I definitely need the money. Yes, I do. Yes. Yeah, I mean, there is a practical nature to this as well, which is just because he lived in the house for 15 years,

it wasn't his. It's not his house. It wasn't his house and now you have ownership of it and there's nothing wrong with you saying hey can you please this is two hundred thousand dollars that you're holding hostage and i really need access to that and there's nothing wrong with with saying that and to dave's point you're not putting him on the street he's coming away with a couple hundred thousand dollars which is a nice chunk of change and where where is the house where's the house and niles just outside of chicago oh in chicago area okay yeah chicago area are you in that area as well right yes okay well um are you married no i am divorced okay um okay um i'm just looking for the dot what the dynamics are so okay um is there anyone in you and your brother's life that could sit with the two of you while you work on this that could help

uh kind of navigate through all the emotion? Well, I haven't talked to my brother in probably five months. Okay. So this makes it even more difficult. He's, he's, um, basically just cut everybody off in his life. Okay. All right. I would call him and I would go over there and it's half your house. Okay, and say, we need to have a cup of coffee, and I love you, and I want to be kind to you, and we've got to talk about what we're going to do here. Because I can tell you this, one of the options is not, this is you talking to your brother, if it's me, you've got to love him well enough to be strong and kind.

And just, honey, one of the options is not you stay here free the rest of your life that's not an option i am the executor of the estate and legally that gives me the power to evict you and so you and i can do this together nicely and we can figure out a way to get the house sold or if you've got money that i don't know about you can buy me out i don't care but i'm not going to sit here and do nothing and you aren't either because i'm going to force you to do these other things i really want to do this in a way that you and i work together and we can be friends the rest of our life and um but that's going to be up to you okay that's what i'm telling him it's up to him how he reacts to this situation because his set of assumptions are completely immoral unethical

and unreasonable correct and and so he he can choose to react and act like you're doing something wrong but you're not and you have to go in knowing that and in it so let me just tell you so you go over there the whole thing blows up he has a fit acts like a four-year-old says get out of here i'm going to shoot you then you say all right here's what we're going to do you're going to be getting a letter from the attorney and the attorney is going to be telling you that you have 30 days to move and after that we're going to evict you and after that i'm going to sell the house and i will be telling you that you have 30 days to move. And after that, we're going to evict you. And after that, I'm going to sell the house.

And I will still send you your half of the house once it's sold. But you are leaving. And you chose poorly on how to react to this. It's still going down, honey. And then just walk off and go get a lawyer. Okay. Because that's probably what's going to happen. Am I right?

I'm really taking this to heart. The, the other thing in the, in the interim, my father has gone ahead and he's taken $1,400 a month from his future inheritance. And he's given that to me as a rent. And he says, well, as long as your brother's in there, he says, you're going to keep getting $1,400 a month and that'll go over to your inheritance but you know dave as well as i know we don't have the crystal ball that money could easily disappear down the road we don't know i don't like that so your father also is an enabler he's covering for him too am i understanding that right i think he was just feeling bad for me and just,

Oh, you feeling bad for you. Okay. Well, it's both because he's saying I'm essentially paying your brother's rent. And if you let me pay rent to you, then you can let him stay in the house. It's,

it's very twisted. All of it. I mean, I don't have to tell you that it's unhealthy, you know, an unhealthy dynamic. I would rather him give your brother 14001,400 to help him get counseling and go to a rehab center and go inpatient treatment

and get some help with the anxiety disorder so he can become sustainable and healed. I'd rather him use the money for that and let the lady who lives there's family take care of her and your dad help take care of her. And your dad help take care of your brother. And if you want to use some of the money from the house to take care of him, if he's moving in positive steps, I'd be willing to do that if I were you. But I am not willing to sit here and cause this dysfunction to happen to me. It is not good for anyone in the story.

No one in the story is winning. Correct. No one in the story is going to have a better life because of this. So it just requires proactivity on your part. And I'm sorry, but it's going to be, you got a year of emotional hell ahead of you. You're going to get called everything in the book before this is over. I'm sorry. Pick up Dr. Henry Cloud's book, Boundaries. You'll read it and you'll go, oh, there's my family. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love,

and create actual amazing relationships. I'm Dave Ramsey, your host, Jade Boshaw, Ramsey Personality. Number one best-selling author is my co-host today. Thank you for joining us, America. Open phones here at 888-825-5225. The call is free, and some say the advice is worth exactly what you pay for it. Scott is in Baltimore. Hi, Scott. Welcome to the Ramsey Show. Good afternoon, Dave and Jade.

How are you doing today? Better than we deserve. What's up? So I'm a 58-year-old single guy getting tired of working. I'm trying to get to retirement, but I don't have really anything saved. I need to know what I should do to get there. Okay. What do you make? 75. What do you do?

I'm a trim carpenter. I trim high-end houses and build some custom cabinets as well. Okay. Do you have any debt? I've got about $25,000 worth of a mortgage and $20,000 auto loan. Okay. Good. Okay. All right. Why have you saved no money uh i was i was married to a spender and at the age of 50 um got divorced

and i walked away with zero dollars that was eight years ago why have you saved no money in the last eight years um well getting back on my feet i ended up buying a house. That's where the mortgage comes in. I got $25,000 left on that. So is that where your extra money was going, paying down that mortgage? What did it start as? Yeah, paying down the mortgage. And it was a bank-owned property. I got it for a song in a great neighborhood.

I put a fair amount of money into it. And that's where most of my money went so so that all right so and you bought a truck uh no i have it's it's my i have a truck that's paid for. Oh, what's the $20,000 vehicle? I know you're into cars, Dave. It's not a car. It's a motorcycle. It's a Harley Davidson. Oh, okay. Well, we've got to get rid of that.

I knew that was the first thing you were going to tell me to get rid of. Yeah, it's gone. If you want to save money, I mean, we can't keep doing what we've been doing. Okay, you have a $20,000. You almost owe as much on your motorcycle as you do on your house. That's weird. Yeah. You know, I mean, really.

So, you know, you did so good on the house and so poorly on the motorcycle. So that was a weak moment. I'm sure it's a great bike. I'm sure it's a great bike. But it's gone. It's gone. It's somebody else's great bike now and um because we need you to and then you know what i would say is let's get on an every dollar budget and build an emergency fund first of three to six months of expenses and then

pick up every extra job you can get and let's pretend that you saved $10,000. Let's pretend you saved $24,000, $2,000 a month, $24,000 per year for 10 years. That'd be $240,000 plus growth. It'd be a half a million dollars. Okay. Okay. You're 67, and you'd have a half million dollars in a paid-for house. Okay. I do have about $23,000 in cash. Okay, well, then you've got your emergency fund in place.

I do have that. That's great. I do have the emergency fund. Right. Also, I've got a term life insurance policy that's $100 a month for half a million dollars. Should I keep that, or is there a way to convert that to something else? It doesn't convert. It's just like I have homeowner's insurance, and I don't have a home anymore.

Do I need it? No, you don't. Because there's no one counting on you, it sounds like, for your income. No. Okay. And the house is worth more than you owe on it. Do you have children? I've got three. Okay. So if you die, they sell the house and worth more than you owe on it. Do you have children? I've got three.

Okay. So if you die, they sell the house and pay the funeral, right? Correct. Okay. Let it lapse. Yeah. So I would close that out because you need that extra $100 a month toward our $2,000 a month goal. So what I'm going to do is sit down and do a budget, and I'm going to come up with $2,000 a month. I'm going to sit down with a SmartVestor Pro and I'm going to fill up Roth IRAs and simple IRAs and whatever else you can do as a self-employed person. The great news is as a trim carpenter in high-end properties, you are in great demand. You've always had more work than you could take on.

Right. And so if you want to jack it up and make some extra money for a little while, you can do that. I'm always less tired when I don't feel like a hamster in a wheel, when I'm actually getting traction. Part of what's making you tired is you feel stuck. I don't know if I necessarily feel stuck. I know what stuck feels like because once I got out of my divorce and got rid of the spender and started actually saving or being able to have money and didn't have to live paycheck to paycheck

and play the beat the bank game, I sat down one day and thought, wow, this feels really good. Yeah, I'm tired of working is what you told me. And so if my work is going toward a goal that I'm excited about, I'm not as tired. That's all I'm saying. Okay, yeah. Well, my goal is to get as much money, save as much money as I can for retirement. And retirement for me is probably working three and four days a week instead of, you know, five, six, and seven days. That's true, but there always comes a time where you won't be working anymore.

And so making sure you get to the point that you're okay when that phase of life hits is also very important. See, if you had a half a million dollars in the bank at 67, or in a mutual fund at 67 in a paid-for house, that $500,000 will throw you $50,000 a year. Right. Without forever. And so you can travel, you can do whatever you want to do with $50,000 a year. You work one day a week, you can do whatever. What I do know, having grown up and been in the building business,

real estate business my whole life, is trim carpenters are artists. They're the artist on the site. They're very precise, very he makes furniture you've got an artist's eye and i need you to use your business side the science not the art side of this discussion that we're having okay you can't art your way out of this one you got to science your way out of this one and so it's it's a math thing um and then you it will build you a a situation where you have enough of a nest egg that it caused you to have a good life that's what i'm wanting to move you towards so you got 10 years two thousand dollars a month and you can get there it's very doable and you might fool yourself you might get there sooner uh because the more you pile it up, the faster, the more you're willing to work, all that kind of stuff.

So, you know, you can back down at whatever point. But I would sit down with SmartVestor Pro, go to RamseySolutions.com, pick somebody with the heart of a teacher and say, this is my situation. I've got to do this. Dave told me to get on an every dollar budget. He told me to jack my income up, get rid of my motorcycle. Jade told me, get rid of my motorcycle, but Dave agreed. And just slide that in there, just through that, through the, under the, you see the bus tracks, I see the bus tracks right across her. Yeah, there we go. And yeah, get you a game plan, man. And then execute the game plan.

Just like you were doing a job on a house. You lay out the game plan. You lay out what is needed. You get the supplies on hand and you execute. Same thing here. Same exact deal. This is The Ramsey Show. Hey, you guys.

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So go to YReffi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey might not be in all states. Today's question comes from Patty in Illinois. My husband and I purchased a very modest home for his parents due to the rising cost of rent in our area. My father-in-law is disabled. My mother-in-law works full-time at a very modest job and they pay us a small amount of rent each month. It's been five years now and the home has required a lot of repairs such as water, intrusion of mold. We've been able to cash flow the problems but it has cost over $15,000, not to mention our sanity. It has also changed our relationship because they frequently contact us for issues or requests in spite of

many conversations about what is, quote, nice to have versus what is, quote, needed. We're trying to honor our word, but it has been very taxing emotionally and financially. We're in baby step six and we need to plan for our own retirement. I keep telling myself to suck it up, but we are losing tons of money with no end in sight. I've listened to the show long enough to know we probably shouldn't have done this, but at the time it felt like the right thing to do. What would you do if you were in our shoes? Well, first off, I wish I had more information, Dave. I want to know how old these parents are. I want to know more. I want to know the value these parents are i want to know i want to know more i want to know the value of the house because i'm thinking if you bought a house in 2019

like the value's probably gone up a good deal so they're she they might not be losing money in the way that she thinks now the actual idea of doing this i think was a really bad idea um i think there was just a lack of foresight here and i don't know what the promise was did they say hey we're doing this house you're gonna live here and you know until you die and we're covering it i don't know what the promise was but i think that they may have you know brought promised more than what they could deliver on and i think that's probably what she's feeling some type of way about so she's got a lot of drama in her words she does and it's her in-laws uh-huh i i the piece of information i would like is i'd like to talk to her husband and see if he feels the same way uh-huh and if it was everybody's bothering him to the same degree or if this is in-law drama that you are now molding or laying over on this house yes uh-huh i think

it's a little bit of both she does use the word we a lot which makes me think that there is some unity no i think i don't think it was a hidden thing uh but i think he went into it and went i bought mom and dad a house and dad's disabled mom got a you know not not much of a job and they pay us what they can pay us and we fix the stuff that breaks and yeah and she's going oh god i'm dying yeah you know it's like um so i don't i you know fifteen thousand dollars is not uh we are losing tons of money for five years no it's nothing if you own a house you're going to spend more than fifteen thousand dollars over five years on a house and they're getting some rent which is good and it's going up in value uh-huh going up in value mom and dad are going to pass someday and you're going to have a nice asset

that's gone up in value that you can sell and probably pay off your house and more if you haven't already so i think i would first thing i would want to get to the bottom and say what is where is all this resentment really coming from um is it really coming from the house I kind of don't think it is I don't think so I now there is part of it where they may have bitten off more than they realized they were going to be chewing do you know what I'm saying like in in theory it sounded good and then when you start walking it out you're like like, oh, my goodness. But to your point, if she's writing into our show, there's something that they're not talking about. If your mother-in-law is calling you and asking you to fix something at a house that you gave her at a deal and you already had, you know, mother-in-law itis, then that would just make it worse right i mean yes it's like well you know the difference in what is needed and what's nice to have yeah but you know it's

a modest home they're modest people she makes a modest income there wasn't anything in here lavish there's also though i didn't hear a jacuzzi being installed i think to to quote myself i think there's also a vocab rehab that needs to happen. Because here she's saying, my husband and I purchased a very modest home for his parents. They don't own the home. They're renters. You guys bought a house for yourself. It's your asset.

It's your home. And I think if you start viewing it as an asset that we have, it's going to change your thoughts. I have a rental house and it had a water leak and I had to fix them all. That's right. As opposed to it's- Guess what? I've had to do that a bunch of times.

Right. So that'll help. And I had zero drama about it. That's right. I just fixed it. And it's going up in value. Tree fell on the back porch. I just fixed it.

It's just, you know, it's just you own a house and crap happens, right? I mean, it's like the other question that i don't i'm with you i don't think we have enough information because it's very interesting question it is and i'm impugning a lot on you patty i apologize for that but i'm trying to figure out what's really happening here and therefore to what to do with this because also their age might play into it if she's if they're 87, suck it up. If they're 57, kick them out. Sell it and give them the money that it brings, whatever it brings. Give them the money from it because you didn't buy it for money.

You bought it to help them. If you want to give them whatever proceeds are, because you're going to have made some money to your point from 2019. So, yeah, that's that's that's part of it and um yeah yeah and and i think then i would want to just really ask i don't know um well walk that out what would you do so let's say let's say she's listening she goes yeah you know what they are in their 50s they need to get out of this house they've been paying us a small amount of rent what would you suggest in that situation to fairly i mean i don't care if you give them the money

really i mean you sell the house and whatever whatever i don't i don't know if there's a mortgage here or not but pay off all the expenses and then whatever money you've made on the house give it to them i don't care um oh i'll tell you the other piece i don't know right here is i don't know patty's income yeah that know Patty's income. Yeah, that's right. If Patty makes $300,000 a year, stop whining and deal with it. That's another good point. If Patty makes $55,000 a year, then you did something you couldn't afford to do here. That's true. And that's where some of this drama is coming from is the pinch.

Mm-hmm. Mm-hmm. Because it's like, oh, it's, we're, but we're, it's been very taxing emotionally and financially. Yeah. Okay, I don't understand. It's 15 grand is not taxing emotion. I mean, it's not, but so that's, yeah.

It's a lot of details. Maybe call in sometime, Patty. Yeah, yeah, we'd do that. So you can contact them back off the email if you want to, James. We'd take the call because I don't know what back off the email if you want to james we take the call because i i don't know what to do but if yeah i think we could give a couple of scenarios if then okay kind of flow charted if they're super old and you make a lot of money then this drama is in your head calm down and suck it up if they're super young and you don't make a lot of money

maybe you need to move them out and sell the house. I think those are the two variables that could be there. I don't hear a lot of mother-in-law drama, but I just think it was curious to me how much drama she had, and I wondered if her husband would feel exactly the same way. I bet he doesn't. Now, if they're only paying, you know, the mortgage is $2,000, and she said they're paying a small amount of rent, so they're paying $1,000, the proceeds, I'd split.

Okay. I don't care. The thing is, you're not selling it because you need money. That's true. She did not bring that up. You're right. She did not bring it up. Selling it to get rid of an emotionally and financially draining situation, to quote her.

That's true, but she did say, we're in baby step six and need to plan for our own retirement. So that made me think they might want some money. Could be, and it could just be that I'm tired of giving them anything. I'd rather put it in my account. In lost situations, they get salty really quick. Not going there. Not going to do that. You're right. You started the whole thing right when you said you shouldn't have done it. Not going there. Not going to do that. You're right.

You started the whole thing right when you said you shouldn't have done it. Foresight. You have to play these things out in your mind years and years to see where it will land. And all of the different variations of the plan. When you're trying to help your parents, you're trying to help your own kids, you do not enter into a process that does not bring them to sustainability on their own. And so you get them up where they're standing on their own feet and you let them go. So whatever you're doing, create a situation that gets them up on their own feet

instead of a continuous drain. And so that's, so you people pay in your 28 year olds, private schools for their kids. that's not sustainable. You shouldn't have entered into that. This is The Ramsey Show. The $12 sale is here through August 31st. We've got $12 books to help you raise money smart kids. The book Smart Money Smart Kids, number one bestseller by Rachel Cruz and me. $12 books to help you get out of debt and build wealth,

including our number one bestseller, Baby Steps Millionaires, including Jade's book. $12 books to help you build a peaceful and joyful life. Dr. John Deloney walks you through the six daily choices in building a non-anxious life. Ken Coleman's From Paycheck to Purpose will help you do work that really matters. All $12. Check them out, ramsaysolutions.com. Slash sale. Barbara is in Santa Barbara.

Hi, Barbara, how are you? Oh, good. Thank you so much for taking my call. It's a pleasure to talk to you both. You too. I've been listening to you for quite a while. I know how you love whole life insurance policies. Yeah, my husband took one out literally in college in the 60s because a friend of his, you know, got their first job and sold everybody in the fraternity house a whole life policy.

So it is now 2024. We still have this policy, but I've never heard you address this issue. If we terminate this policy, because I feel we can self-insure at this point, I have a loan on this policy for $63,000. And the agent is telling me if I surrender the policy, that will be taxed at my income or income level. Is that true? No. No.

No. It's not true. Because I thought my understanding was the way you talk about it, when you borrow against the policy, you're actually borrowing your own money and paying interest to borrow it. Exactly. And so your cash value amount is how much? $3,030.

Above the $63,000? Yes. Okay, so you'll get a check for $3,000. Okay. Okay, and you'll have a net income as a result of that of $66,000, which includes the loan, okay? Yeah. That amount is compared to the total amount you have paid into the policy since the beginning which is way more than sixty three thousand dollars okay your basis in a whole

your basis in a cash value policy for tax purposes is the total of your premiums paid in right and your as long as your cash value does not exceed that number, you have zero taxes. Okay. So I would think that since it's been paid on since really the 60s, 70s. Yeah. How much have you paid on it? Do you know? No, I have no idea. The death benefit is $24,000.

But I mean, if you add it up, you're going to add up and see the total premiums that you have put in is going to be more than the cash value that you get out. Okay. How am I going to find, where do you find that? Can they tell me that? They can tell you that. The company can tell you that. Or you could just say, you know, how much is the monthly or the annual amount and multiply it out since you got it. Oh, okay.

Okay. Okay. I got you. And I would think that we've paid in enough over all these years that it's more than $63,000. Exactly. I mean, it's been 60 years. 60 years. Oh, my gosh. So if it's $1,000 a year, if you only paid $1,000 a year, you're still okay.

Yeah, I wish I'd found you a long time ago. I would have never bought this policy, but I just never knew about this loan thing because I know you say surrender them if you can self-insure, but I've never heard you address if you have a loan on it. They keep telling me I'm paying income tax on it. Well, that's what they like to tell you because they scare you to keep the thing in. But the problem is most of the people in the whole life business don't even know what they're doing. Their level of expertise is so low because 80% of them are gone in a year.

People that sell whole life life insurance, 80% that start selling whole life life insurance are gone in a year. So the number of seasoned, experienced, expert agents that have been doing it for 30 years it's close to zero because they look up and realize how bad they're ripping people off and they get out of the business the numbers on this are bananas yeah she's been paying into it since the 60s it only had 63 000 of cash value and only a $24,000 death benefit. Yeah. Yep. I'm shooketh.

Yes. I mean, what if there was $63,000 and she hadn't borrowed on it? I know. And she died or he died. They'd lose it. They'd get $24,000. The $63,000 would be gone. The only way you ensure you get it is to keep a loan on it.

And then when you try to get out of to keep a loan on it and so and then when you try to get out of this complete screw job they lie to you or they're ignorant one of the two about how the tax calculation actually works that is crazy yeah this is how bad it's a payday lender of the middle class remember on sanford and son when red, I'm coming to join you. What was his wife's name? Lily? Yeah, I think so. I can't remember. I'm coming.

I'm coming. Oh, gosh. That makes my heart. Oh, Lord. Sheesh. That's it. That's how it works. Spencer is in Austin, Texas.

Hi, Spencer. How are you? Dave, Jade, thanks so much for taking my call. Sure. What's up uh yeah so um my situation right now so i live in a house that my parents own and um they want to sell it to me and i want to buy it from them and i have the cash to pay it off good um but they want to yeah which i definitely follow your plan on that for sure paying off cash well i don't like that either

um so but anyway i guess the reason i'm calling though is because uh so they've owned this house Yeah, which I definitely follow your plan on that for sure. Paying off cash. I don't like debt either. So, but anyway, I guess the reason I'm calling, though, is because, so they've owned this house for just under a decade. And so, you know, they bought it back in 2016 for just under $100,000. And now, as you know, the housing market is crazy. So, I think this house is worth somewhere between, you know, $200,000 to $225,000. So, you know, they want to sell it to, we haven't negotiated a price yet, but they want to sell it to me, you know, somewhat close 225. So, you know, they want to sell it to us. We haven't negotiated price yet, but they want to sell it to me, you know, somewhat close to what they paid for it. So I guess my question is, I know it's a good deal for sure. But I guess my question is, you know, I guess I'm calling on their behalf too, because, you know, we're wondering about like, are there

going to be capital gains taxes? How does it work with me buying it at much less than what it's worth? Like, how does all that kind of work and what's some ways around if there are any i don't like capital gains and things like that okay well capital gains tax is calculated on the gain over basis let me kind of walk you through that that's a technical thing all right what you pay for a house is your basis okay so let's say they paid a hundred for it and let's be simple for a second and say they sold it to you for 150 then they would pay capital gains tax on the 50 gain see what i'm saying yes okay and that's a 15 and so that would only be, what, $7,500 will be their taxes. Okay.

That's a simplified look at the thing. Now, we'll add a couple of complications in there. If they have been renting the property and have been filling out a tax return on that and depreciating the property against their taxes taking depreciation then they have an adjusted basis so the hundred thousand they paid for it minus any depreciation that they have taken becomes their basis so let's say they had taken twenty thousand dollars worth of depreciation on their taxes over the years then their basis is no longer 100 now it's 80 you following me yes sir it's called an adjusted basis and then your taxes are going to be on the

difference between the 150 and the 80 so they're going to pay taxes on 70 grand in that case so that's how you calculate it out if they sell sell it to you weirdly below market, like let's say this thing is worth $300 and they sell it to you for $100, you probably ought to get some tax advice as to whether or not that's going to qualify as just a good deal or whether the IRS would look at that as giving you a gift and try to tax them on a gift tax. I wouldn't want them to get hit with that. So there's kind of a gray area on the difference in a gift and a good deal. Okay. And that was my other question too, because they're going to sell it to me for less than what it's currently valued at. And so I guess they were kind of worried about that as well.

How far, how absurd it, you know, if they sell it to you for a dollar and it's worth a million, then they sell it to you for a dollar and it's worth a million, then they're going to get hit with a gift tax, okay? Because that's a gift. That's not just a good deal. That's over the top, okay? It's going to be going to kind of shake everybody up that looks at it. But if you sell you a $300,000

house for $200,000, that's probably just a good deal. So you need to talk to a tax advisor on that part of it to make sure that you're not violating anything on gift tax what at what point does the irs look at something being a good deal or being a gift and then they also can help you with calculation on the basis so good deal and pay cash for it and it's a free clear transaction it sounds like a wonderful deal this is the Ramsey Show.

Jade Walsh, our Ramsey personality, is my co-host today. Thank you for joining us, America. We're glad you're here. Val is in Minneapolis. Hey, Val, welcome to The Ramsey Show. Oh, family, family. I listened to you years, five years, and I said it's time to stop listening and start doing it. Okay, good.

How can we help today? Right now I've finally started with the first and second step, but now I'm at the point where I have three kids that I know I shouldn't have, and I did it. I co-signed for a column because, you know, if you do one, you've got to do the other one. So I'm stuck with these three car loans. One of them is about to be paid off in two months. The other one, she's paying half on it because she said she's going to have all of it to pay the whole car loan, and I'm paying the other one.

And the third one is just saying they don't have the money right now. So my question was, I was thinking about just letting the other two cars just go because I can't afford to pay for neither one of them. And so would it be a good idea if I just let them reach for it and just let it go on my credit? Well, you're going to have repossession on your credit. You co-signed. And then when they sell the car and it doesn't bring what's owed,

they're going to come after you for the difference. I know. That's why I hit them at the point there. Yeah, you're going to get sued, and you're going to have your credit screwed up. So let's talk about the one car is almost paid off so it's not a problem right right okay so the other to the second car they're when you pay part of the payment what is owed on that second car

one car is oh one of 16,000 on one and the other one is like 14 000 okay and what are they worth the one for 16 000 is only worth 8 000 that was shocked and the one that's worth the one that's worth 14 or the one that you owe 14 14 000 it's about um i think they said i almost sold that one for 10 000 so i'm thinking this guy's gonna buy it for 10 000 but he never did come through so i guess it only works like 9 000 or something well just because one guy didn't buy it that doesn't establish value but um yeah so um if you can sell the 10 the 10 000 car for 10 000 and get the loan you have to get a loan somewhere for 4 000 to cover the difference who are these loans with they with uh my credit union good go down to your credit union tell me you want to get a loan somewhere for $4,000 to cover the difference. Who are these loans with?

They're with my credit union. Good. Go down to your credit union and tell them you want to sign a note for the difference before these cars get repoed, and you're going to have $12,000 in debt. You sell an $8,000 car that you owe $16,000 on. You sell a $10,000 car that you owe $14,000 on. You're going to have a debt with that credit union because otherwise they take these cars, and they're not going to sell them for $10 and for $8.

They're going to sell them for $5 and for $4 at the repo law. So I can sell this car back to the bank? No. Oh, you said I can sell it back to the bank. No, I said you go down to the bank and tell them you want to sign a note for the difference of what the car won't bring they have a sixteen thousand dollar loan on a car that's worth eight you're going to end up with an eight thousand dollar loan at the credit union instead of a sixteen thousand dollar loan and you sell a car

that's worth ten that you owe fourteen on you're going to end up with a four thousand dollar loan instead of a fourteen thousand dollar loan and your kids are going to get about the business of getting their own cars right but you get to pay the eight and the four difference which is going to be 12 because they're not going to come through on that you and i know that yeah this is what you this is what you pay this is called a it's called a co-signing fee is that what you're calling it i thought there was an actual no no it's a stupid tax is what it is when when i do something stupid and it costs me money i call it stupid tax and the co-signing is stupid yeah i learned that you learned it you learned it three times over you thought you were doing something nice and you

did the right thing the wrong way you were being kind and sweet and unwise and you knew you were unwise when you were doing it but you were too kind and sweet to stop doing it. So next time, be more wise and less sweet. I know, that's right. Wow. Well, the truth is she didn't do the kids any favors either because they've been strapped to this. That's right. That's right.

You think you're doing somebody a favor and you strap them to something they can't afford, and that's why the bank wouldn't loan them money in the first place. And everybody feels the strain. Yeah, Thanksgiving dinner tastes different so i co-signing is so universally stupid the banks are the most aggressive lenders on the planet they love to loan money and if they won't loan somebody money it really means it really means something that they can't but that they can't pay it and instead we step in and we go oh it's little junior we'll help junior and you know we step up and we cosign

and proverbs 17 18 says one lacking in sense cosigns for another wow the contemporary english version the cev of the bible in 17 18 proverbs says if you co-sign for someone else it's stupid that's what that version of the bible says the bible called it stupid so i didn't get mad at god but yeah and i co-signed for a guy one time and i ended up having to pay it and a guy co-signed for me one time and he ended up having to pay it because i went bankrupt that time and i had to go back and pay him back later it's an awful awful mess don't get into those things. It's a horrible, horrible situation. So poor Val.

I feel so sorry for her. It's awful. Hey, guys, things are changing around the Ramsey show here. This week, back on Monday, we made a move. We have a network app called the Ramsey Network app that you can download for free. You can listen to the whole show on the Ramsey Network app or watch the whole show on the Ramsey Network app, whichever you prefer to do. The last 40 minutes coming up is only on the Ramsey Network app or on talk radio as of this week. And so if you're used to getting the entire show on podcast,

you can still get the entire show. It's still completely free, but you can only get the last 40 minutes on the network app. You can watch the whole thing, but you can get the last 40 minutes only on the network app. So you YouTube folks, podcast folks out there, you're expecting another 40 minutes. It's there, but it's only over on the ramsey network

app you can get it for free we're not charging for this it's all free and it's searchable you can search it by subject and you can even send an email ask questions we might answer some ramsey app questions at some point so the ramsey network app in the App Store or Google Play, completely free, not going to cost you a thing. And, Jade, this is exciting. It is. The things that we're putting in this app to help you guys and help you access the information that you're listening for. You could listen for three days and not get the answer to your question. Yeah, but if you want to know about car repossessions, you can just Google it in.

And you'll hear Val's call. Yeah, exactly. That's what's going to happen because they do come after you for the deficit. know about car repossessions you can just google it in and you'll hear val's call yeah exactly that's what's going to happen because they do come after you for the deficit like we were telling her in that case so uh two ways to get the free app you can click the link in the show notes uh or you can search ramsey network in the app store or google play and again we're going to be adding lots and lots of tools to this thing in the future. Right now, we have the searchable feature. We have some audio books and some other things dropping in there. We've got all kinds of processes because we're building stuff out where we can deliver to you on this app. It's very inexpensive for us to do, so it's going to be free or inexpensive for

you to do. So the last 40 minutes of the show as of this week again on the ramsey network app only or if your talk radio station carries uh and on talk radio it comes out as over three hours that's what we do we do a three-hour talk radio show but in podcast world it's going to look like something different so that's the thing so you can get all all you get the full episodes to the ramsey show only the ramsey network app it's very convenient very easy and very free don't miss it and uh again jade where the the features we're putting in this thing we're excited about i'm really excited i heard a little birdie talking about a show that one of us is doing that might land in there so that's really oh okay that's all i'm gonna say i'm just gonna oh i don't know which little birdie this was so i have to find out about this birdie okay cool that but that might be fun we could we could do just a show just on that yeah

like a specialty show yeah that you can only watch on the network on a certain subject or yeah that would be neat be special ah okay exclusive if you will yeah and completely free you can't argue with the free part we have no plans to make it a subscription it's just a free deal so go to ramsey network and get the app in the app store or google play and that way you don't miss a thing and did i mention that it's free this is the Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships.

Thank you for joining us, America. Open phones at 888-825-5225. You jump in, and we will talk to you about your life and your money. Jade Warshaw, Ramsey Personality, number one bestselling author, is my co-host. Joni is with us in Portland, Maine. Hi, Joni. How are you? Good, thank you. I'm glad to speak to you guys. You too. I love listening to your advice. Thank you. How can we help today? I've inherited two trusts from my family.

I'm calling about one I use, one was large and I used a lot of money for my life. But the second one is smaller, and I called to ask about that because it's really cut and dry, and I extrapolate out that the investment losses and the taxes and fees that have been taken out in it. Gary. So the smaller trust that I got six years ago, 2006, $428 over the six years, it's lost 12% due to, Oh, fees, trustee fees, taxes, inheritance stuff, CPA, CPA, that kind of stuff. So that's reasonable, if you took 12% from 2006, it didn't come out to $135,

which is what they said the value was then. I'm sorry, $2,006? $200,000. Okay. Oh, $206,000. Okay. So you put $200,000 in the trust. Take away.

You were charged 12%. Take away. Yeah, $200,000 in the trust, and you were charged 12%. 12% is 20. Withdrawn have been fees and taxes of 12%, 24,630. And they say the value now is 135. So I did a little math and realized there was a difference of 46, 361, which is a 22. I said, how about this? Where did this money go?

And they said, oh, it's depreciation. I'm like, how about, why didn't you tell me, first of all? Second of all, that sounds like an investment loss. Joanie, Joanie, what's it sounds like an investment loss joni what's what's it invested in um through stewardship partners no no no no no i ask what the investment was in not who is through um medical uh no liquor no abortion no sex trafficking, no. It's all in medical advances and some clean stocks and bonds. Okay, so it's individual stocks or in mutual funds?

Individual stocks chosen by the investor. And they basically built a portfolio that lost money. Right. Okay, all right. And how come you didn't know this for six years? How come you didn't know this for six years? It's your money. Well, they told me it was going to keep increasing. I know, but they tell you a lot of stuff.

Why did you not look at it for six years i guess like the last caller i'm paying a stupid tax i trusted them they told me it was going to increase and i believed them okay all right so you had you you invested poorly uh you got bad advice and you followed the bad advice and you didn't check in on it. So let's build something going forward because I really can't help you with that. You just put you but you put the portfolio or you put the investment with advisors that invested it poorly when you should have been making a lot of money. You lost money money instead and so you need to get it away from them agreed yes and you need to sit down now here's the thing your job going forward is to manage this money

not turn it over to someone to manage your money you don't send your money off to boarding school you raise your own kids okay so your job i did that part right yeah your job is to learn what the money's going into and why you think it's going to go up and then check to see that it does and have regular meetings and communication with a smart investor pro is what we that's the people we recommend and they have the heart of a teacher because it is not their job to manage your money it is your job to manage your money and it is their job to give you advice and teach you and you make choices to give you that's their investment advisor they're not a babysitter or they shouldn't be this is how people lose their

tail in is you just turn it over and blindly walk away and go i trusted them and when we talk to people in the pro sports world in the nfl or other pro sports and they say i you know i lost all my money because i turned it over to a man i turned it over to my man i got me a guy and you know that that's code for i ain't looked at it I have no clue what I did I don't know what's going on and then it's their fault no it's your fault it's your it's your responsibility to stay on top of this so you've learned a uh it sounds like you've learned a fifty thousand dollar light lesson here and uh you're going to move the money to someone that teaches you and it's now it next time you lose money or make money, it's going to be your fault.

Because when I lose money or make money, it's my fault. I don't blame it on the advisor. The advisor's job is to teach me and based on what I learn, I make the decision. And based on the ongoing communication, I make the decision whether the money stays in something. And I certainly don't look at it once every six years. Oh, gosh. That's scary. Joni, I'm not going to turn these guys into villains.

They're not villains. They did what you told them to do. They did it poorly. But you didn't check on it. Yeah, because every fund doesn't make money well it's a it's a group of stocks they had built their own little stock portfolio and it wasn't successful they chose stocks that they were more concerned about whether they were engaged in sin than whether they were making money and um this trying to she's

everything's clean no alcohol no whatever all the which is fine i don't have any problem with that motivation that's not a horrible thing to do but if you're if you're spend all your time analyzing it based on what the company does on that instead of whether it actually makes money then you end up with a failing portfolio and uh people do that with um uh from a religious standpoint which is where she's coming at it, a Christian viewpoint. I don't want it going into stuff that make God mad. Right. And I don't blame you.

That's not a bad thing at all. That's a good, that's a noble call. But while you're doing that, you have to make sure that the companies are actually profitable, too. Otherwise, you end up with less money. So, Joni, I'm really sorry you went through this. It's an expensive lesson learned. I've learned it myself. Most everyone has it one time or another.

But the lesson is that you get people in the financial world not to babysit you. Their job is to advise you, and you are a grown-up. You make the call. And then that will keep you from ever having this feeling again of being ripped off. You weren't ripped off. There's no con artist here. No villain in this story. There might be some incompetence, but there is no villain in the story, including you.

You're not a villain. This is The Ramsey Show. Jade Walsh, our Ramsey personality, is my co-host today. If you're going to sell or buy a home in this crazy real estate market, you really ought to have a professional in your corner helping you. Somebody who sells 30 to 300 houses a year is a pro. They know what they're doing. They do enough volume to actually be considered an actual real estate professional,

not someone who got their license three weeks ago and said, Look, I want to sell your largest asset. No, bad idea. Bad idea. We vet the agents that we recommend as being highly experienced and high producers, and they know the Ramsey stuff. They're aligned with us. They're coached by us. That's how they become Ramsey trusted.

Ramsey trusted real estate agents can be found for free. The service of lining you up with them is free at ramseysolutions.com slash agent. Frank is in New Mexico. Hey, Frank, welcome to the Ramsey Show. Hey, Davey, how are you today? Very good. How can we help? Well, me and my fiancee, I proposed to her last year. After six years, I finally decided to give up the pot. And so she owns a business and I work in the government. And last night she divulged to me that she has been nervous about getting married because she hasn't filed her taxes in six years. Ooh. Okay. And she's, you know, she's a business owner. And.

How much does she owe? She doesn't know. She doesn't know yet so she's she has a tax order and the cpa on retainer to get this mess cleaned up oh good have they already have they already ascertained what they're doing and got a plan in place you were correct yeah they're still going through you know they still they basically have started this year to stay current, you know. Yeah, so they've notified the IRS and they're working their way through it. Correct.

Good, good. So my question is, before getting married, and how do I, you know, how do I protect myself going forward into this relationship? Because, you know, if the IRS comes, you know, if we get married and there's nothing in place for protection that they could potentially come after, you know, my wages or assets. Well, they can't attach your wages for her back taxes,

but they can attach any assets that you own together for sure because of her owning it. So, like, if you bought a house together, there'd be a lien put on the house. I just don't know if there's anything put in place. Nope. Nope. The IRS is all powerful. They're going to hold her dangling over the knives until she pays them. So what I want to know is two things, if I'm in your shoes, is how quickly are we going to get current with them? What's the plan?

I want to see exactly what the numbers are. I want to know details. I want to meet with the lawyer, meet with the CPA. And I want to know how we never get here again. I have a question for you, Frank. Were you, did you have a date in mind that you wanted to marry her? But then when you found out about this, are you considering pushing that date because of this? Well, she already pushed it. Oh, she pushed it.

She, this is all, you know, she told me this last night and it was, you know, a pretty, pretty good gut punch, but it seemed everything kind of lined up and made, made a lot more sense in my head because, you know, I don't know what her net profit is like her, you know, we, we make good, we, we know we make good money. I mean, we probably bring in 350 to 450 a year um and that's mostly on her side you know being the business owner but um well i'm not sure she does well someone is so freaking disorganized that they don't pay their taxes doesn't really know what their profits are true that correct yeah she doesn't know what i know she knows what she grosses but she doesn't

know what yeah what do you gross um my gross is about 120 okay yeah all right so okay i mean really you guys what this indicates is not just an irs problem it indicates dude you've been hanging out with this woman for six years you have no idea she doesn't pay her taxes what's wrong with your relationship that you don't have any better communication than this until the until the dadgum we're walking towards the aisle and she says hold on you need to know this well it wouldn't make me wonder what is there anything else going on yeah is there anything else you want to tell me yeah and and you know you guys you probably need no you do need to sit down with someone and do some detailed pre-marriage

counseling 100 because there's not enough intimacy here there's not enough detailed communication after six years yeah you know you should know what's going on with someone in their life before you know after six years of hanging out, you should really, you should, the depth of knowledge of the person's life and their relationship should be better than that. So Frank, fail on you for that. Absolutely. And fail on her for hiding it out of shame and not doing it. So we need to fix those two things.

And then we need to fix the mechanics going forward of how we're going to get current and stay current from this day forward with the freaking IRS and everyone else and how we never again hold any secrets more than 30 seconds because it becomes a secret after 30 seconds. You have to walk in the door that night and go, hey, I just found this out. You can't walk in the door six years later and go, hey, of forgot to tell you because i was ashamed yeah wow and so that's what you've got to do that that is your protection is the quality of your relationship and the quality and detail of the plan she has to get current and stay current that is your only protection there is no prenup that will protect you from the freaking irs it just won't do it and so the irs is all powerful they can put a lien on

anything that she has at any time they want for her not paying and by the way boys and girls let me help you for the rest of you listening i didn't have to go there because she's already done it but failure to pay your taxes is not a criminal offense in the u.s failure to file your taxes is a federal crime not filing your taxes for six years will get you put in jail how do you avoid that if you're out there and have been off the grid for six years like her you do what she did you get a tax accountant and a cpa and you go to the irs with a plan and then they won't put you in jail but they put 2 500 people in jail last year for failure to fire file so this idea i don't have to file is absolute bullcrap okay i hate it i don't like it i don't like income tax i don't like the tax system there's nothing that's good about it but it is the law and you will failure to file is a big deal so you file

even if you don't pay you file and then you figure out a way to pay because they're going to chase you to the ends of the earth for once you do it but you this avoidance here and ignoring this is a really dumb strategy it'll get your butt in a crack like you can't get out of so frank that's what's scaring me that's what's scaring me here so you guys really you're going to have to increase the quality of your relationship the quality of your communication the promises made on um it's not her business anymore. If you get married, it's our business. And if you get married, it's our income. And if you get married, it's our house.

And if the dog goes in the floor, it's your dog. But everything else is our. 100%. Wow. At least that's the way it is at my house so what do i know the same way at my house your dog tore that up your dog tore that up yeah yeah that was this morning sam's dog and our dog is old too so it's sam's dog a lot oh oh there we go so yeah that's that's the key thing here is um the the detail of communication is your uh and the quality of your alignment is your um that's your protection absolutely and by the way it's also that it's not only your protection. Absolutely. And by the way, it's not only your protection, it's the thing that will give you a high-quality relationship.

Absolutely. It's not just protecting you against loss, it's giving you gain. The gain you're going to get is astronomical. So people communicating about and through money is a big deal. This is The Ramsey Show. Jade Walsh, all Ramsey personality, is my co-host today. James is in Los Angeles. Hi, James.

How are you? I'm doing great. Just calling in a newborn Christian here. Decided to try something new. And I've been listening to your program. Thanks to my sister. Well, thank you. One of my brothers is out in Alaska, Martin. He suggested I should turn in my truck.

I got a 2024 Chevy diesel Silverado 2500. And I owe about $52,000 on it it it's worth about 65 000 now and um currently i'm in between jobs i've been in the union for 15 years i'm making 50 an hour about 96k a year and i'm jumping to ladwp which will give me about 110k a year so when does that start oh no i well i do my drug test on tuesday and then they'll give me a start date after that okay and your questions what did i i'm in the lemon law lawsuit right now with them because they gave me a lot of defects so they offered me a um a settlement and haven't gave me the um the amount yet that they're going to give me my question is should i take the settlement or uh give the truck back even though i have plans

to how would you give the truck back it's worth 65 you owe 52 why would you not sell it oh well it was an option it was an option uh You get your money back, so I'll get $30,000 back if I give it back. So I get out of the contract. Oh, they'll take it back. Oh, wow. Because of the lemon. Correct. Oh, I misunderstood.

I thought you were just going to repo it. Okay. Okay, so you could sell it for $65,000. You could sell it for $65,000 and you owe $52,000, or they'll give you $30,000 if you give them the truck. Correct. Minus the mileage, it's got $20,000 on it right now. So I'm waiting to see what they're going to offer me for my settlement.

Well, obviously, I mean, if you can sell it and make $13,000 or you can give it back to them and make $30,000, we would give it back to them, right? Right, right. Why would you not do that? I mean, what's the most they'd take off for mileage, ballpark it, of the $30,000? I don't know. Maybe like $5,000 probably. Yeah, so you go with the higher amount. In your mind, what would be the downside of giving it back to them?

I mean, obviously, the money talks. Right. So sometimes they give you on the settlement, on the cash settlement, they give you more than what the truck is worth. So I'll be able to pay off the truck and keep like $10,000. I'm sorry. I thought you said it was $30,000 that was the settlement. No, no.

That's if I decide to give it back because i i dropped down 15 and they give it and they give you and they give up your 52 000 debt so 30 plus 52 is 82 right so what i'm where i'm at is um i personally want to keep the truck because i have plans for it um i'm studying to get my contractor's license on the side since I'm going to have Friday, Saturday, and Sunday off. You can do contractor's license without a $65,000 truck. So should I give the truck back and not keep the truck for work? No, I would not keep the truck for work. I would either sell it or I would give it back whichever one nets you the most money if you can walk away from this deal with 30 000 bucks in your pocket go buy

you a 20 000 truck and that'll be just fine for the contractors of business and then i'll make more money correct exactly because here's the deal the guys who drive fancy trucks on construction sites are the broke guys the guys that were to have the beat up old trucks on the construction sites are the millionaires the truck's going to get beat up anyway so you might as well drive a beat up one to the site yeah that's why i bought a new one because i thought it can last for 20 years that's bullcrap you just want a nice truck no that's true all right dude take take the most money you can get, whatever the deal is and get rid of the truck and buy you a nice truck. That's 15 or 20,000 bucks to do your

business with, put the rest of it in your pocket and move forward and go make you a bunch of money and have a wonderful life. Thanks for the call. Leslie's in Chicago. Hi, Leslie. How are you? Hi, I'm doing good. How are you all? Better than I deserve. Leslie's in Chicago. Hi, Leslie. How are you? Hi, I'm doing good. How are you all? Better than I deserve. What's up? So I'm calling in today, and I really want to thank you guys for taking my call. I've been following you for a while, and I'm trying to get some advice on the best way to get started in the baby steps. Like I understand that the

first baby step is to, you know, try to save a thousand dollars for emergencies. And I'm currently working, like I have a full-time job, a part-time job, but I just keep falling into the trap of like being paycheck to paycheck. And so when I write down my budget and I go over like, okay, how much I'm bringing in, I should have about like $500 left over at the end of the month. But I just never seem to have it. It's like either something comes up where I need to, you know, pay for some unexpected with my car.

It seems to always be something. And I'm just really trying to get out of this rut. And I know it sounds really easy to do, but honestly, it's not. It is very hard to do. Some people that, you know, I feel like would know the right advice to give me. So how are you doing your budget? Are you just writing it on paper? Are you doing an every dollar budget? Both. I used to literally have a notebook that I would just write everything down.

And I recently, like within the last week, downloaded the every budget app. So when you go back, when you look through and you say, OK, what is the thing that keeps popping up? What type of emergency is it? Is it with the if you have kids? Is it with the kids? If you have the car, is it with the car? If you can kind of narrow that down and really, because budgeting is about learning from the previous month, like that's going to inform you as you go forward. For most people, when they start budgeting, it takes them a couple of months to really get it locked in. And that is part of that, you know, that's part of the hard parts is getting that budget locked in and realizing what is a realistic amount that I can actually stick to because there is a part of this I always say a budget has to be detailed realistic and flexible so there might be something where you

might need to bring in more money if these are things that are really part of your life that you're just forgetting to budget for does that make sense it seems it does it makes perfect sense um it seems to be like kind of stuff either with mine or my daughter like i have a is it like a oil is it an oil change i needed an extra gas tank or is it i had a flat like an emergency i had a flat tire or you know out of control so an emergency not yeah not really maintenance like maintenance i can handle you know but no it seems to be um like most recently um i had a hose go bad and so it cost me two hundred dollars to get that repaired what is your what are you what are you making what kind of money are you making um about sixty thousand per year between when you did your budget what was at the top of the line for a month um my growth for the month is no your take home you can only budget with take home

what's at the top of your budget what's the number at the top of your budget for the month uh for what i bring my net pay or what i'm your take-home pay your take-home pay when you get your checks when you did the budget you put a nut you put amount of money at the top and then you allocated that did you not yes i did what number did you put the top of the page um my take-home is about 3300,300 every month. Yes, every month. So you're not answering this question because you don't know because you're not really doing the budget, okay? No, no, I wrote the budget question.

No, no, you sort of kind of screwed around and wrote some stuff down. But if you're really doing a budget, you can tell me $3,314 is at the top, and I've got exactly this allocated for food, exactly this allocated for utilities and stuff. But you just kind of wrote down what you wished would happen and then never looked at it again until the end of the month and went, oh, crap, I'm out of money again. Well, yeah, like I said.

Yeah, that's what you did, yeah. Yeah, I'm new to this, and I don't have it in front of me. Okay, so that's going to be the key to this. So why I asked you if you had every dollar is because with that, once you set the budget, you have to check in daily to see, okay, am I on track with the spending? Because if you wait till the end of the month, it's too late to correct it. And what you can do is if you say, oh man, it's the 15th something came up with the car. It's going to cost $200. Then you can go into the budget and say, I have to find where I can trim that and other areas to make this thing balance out.

So I still have my margin. When you get really, really intense about managing these numbers daily, you'll know these numbers off the top of your head instantaneously if somebody asks you. That's true. And that's how I can tell what's going on with you. But if you're really like, okay, I got this, you're like nerding out in your focus. Our Scripture of the Day, Galatians 6, 4, and 5. Each one should test their own actions.

Then they can take pride in themselves alone without comparing themselves to someone else for each one should carry their own load duane the rock johnson said be humble hungry and always be the hardest worker in the room there we go great advice colton is with us in bismar, North Dakota. Hi Colton, how are you? Good, thanks for taking the call. Sure, what's up? I was looking for some advice between the girlfriend and I. We've been chatting ongoing for about two years now about our financial goals in life. What if we can't come to a solution? What if we can't come to an agreement on what we want later in life? What are the differences?

How big are they? Like I'm pro on doing investments, you know, growing my money, working side hustles. I got two side businesses plus a full-time job. She just doesn't want to do investments. She doesn't feel safe with other people with her money. What type of investments? Does that have to do with it? No, no. Like I have a financial advisor. He puts my stuff in some stocks. You know, I get, you know, 12 percent. You know, she just thinks that her money is safe in her savings account and doesn't want to grow it and doesn't really want to look for the future.

Well, I mean, I think there is a piece of this where people do have different risk tolerances, but I think bigger than that is probably a lack of understanding and somebody to explain it in a way that makes sense. And maybe if you've been the person trying to explain it to her, you might not be the one to crack that code for her. Have you guys gone through Financial Peace University? Not through Financial Peace University. She came to some of my financial advisor meetings and chatted with some different ones through around town and stuff like that. We haven't gone through any of your guys' programs together. I've been going through them for about six months now by myself.

If you guys plan on getting married, if you're like this, you know, I think we can overcome this as the one. We'll send you Financial Peace University for free. And I think you would need to go through it together because what it sounds like to me is you're hitting an impasse because you're taking her through the same you're taking her through your uh understanding of this

and it's not resonating for her and so you've got to figure out a way where it resonates and i don't think you or your guys are the ones to do that yeah Yep. Fair enough? Yep. Yeah, we'll give, you'll give you a financial piece and get you signed up for that. Yeah, so the, if we're not aligned on, okay, I don't believe we ought to budget. I believe we ought to live paycheck to paycheck. And thank God's friday and party on the weekend and uh just hope the government i'll take care of us versus you're a diligent saver hard-working guy with a future mentality that's a deal breaker i'm scared because i don't understand investing and the only thing i understand is the bank and i want to do the bank until I understand investing. And all I know about investing scares me right now is not a deal breaker if we're willing to learn.

But if she says, under no circumstances in my life do I want to know anything about mutual funds, I will never put money in there. I think it's stupid. I think you're stupid for doing it. Then, you know, obviously that's not a deal, okay? Yeah. for doing it then you know obviously that's not a deal okay yeah so not understanding is one thing being obstinate and perpendicular to your beliefs and values is a deal breaker and so that that's uh on you know that would be true on uh uh something like uh you know i was talking with a young couple one time that that at our church and the mom there was a the guy's mother was a single mom and she'd raised him yeah

and she was not in good shape financially and um they this young couple's talking about getting married and uh he he said she looked at him and she said well what if your mom can't pay her bills and he goes well she'd move in with us he had assumed that that was it and she went no that's not happening and he goes you wouldn't let my mom move in he goes she goes no never there's a deal breaker for that that's because he's going to take care of his mom before he takes care of his wife that's what he was telling that's what he's telling this girl yeah and she's done she was done she walked out yeah. She walked out. Yeah. I think it's okay to have deal breakers, but there is part of the conversation there where I think if you're going to enter into

a marriage, if I start seeing a pattern of they kind of just, they're easy to put the kibosh on something and I'm not going to think about it. There's no chance, no openness. I do wonder how often they might take that stance. It's, it's one thing to have that stance weren't something that's wrong. It's going to cause, you know, issues going forward.

But if it's just a, once I close myself off, once, you know, I just kind of cross my arms and I say, no, I'm not budging. That's not a quality that you want.

I mean, so the, you know, can a spender be married to a saver? Absolutely. 100%. Absolutely. I mean, I'm married to a saver. I'm not budging. That's not a quality that you want. I mean, so, you know, can a spender be married to a saver? Absolutely. 100%. Absolutely. I mean, I'm married to a saver.

I'm a spender. But I have to learn the value in saving and investing. Yes. And learn what she gets from that emotionally because that's being a good husband. Oh, and by the way, it's really good to be married to me because I spend money. That's right. You're going to have a good life. You're going to have a good life, yeah.

So it's not a bad trade here. That's right. So your spenders need a saver in your life, so you don't have to eat Alpo at retirement, and your savers need a spender in your life so you can have some fun. Yeah, and the risk-takers need more cautious personalities and the cautious person needs to learn to analyze risk and understand it not just run from it that's right so yeah that's the kind of stuff that aren't deal breakers colton but where someone just is obstinate

and says no you know you just take care of it and i'm going to do whatever i want to do over here that's not marriage material you know that's not going to work clifton is with us in mobile alabama hi clifton how are you i'm doing great how about yourself dave thank you for taking my call by the way sure how can we help uh well about 22 years ago i went through a bad divorce and I did get my children. I was able to raise them by myself, but it left me with a lot of credit card debt and I just saw bankruptcy back then. And I swore to myself that if I didn't have the money, I wouldn't buy it. So I don't know boats or nothing like that.

So, but about 15, 16 years ago, a coworker had a house and offered to me for $600 a month, which was amazing. And so I raised my kids in this house. And about two years ago, come find out the, uh, the owner of the house showed up. I didn't know I was dealing through, uh, she was just the executor of the will. So I've been paying her all this time. She never raised my rent because I always fixed everything and took care of everything because i feel like it's a reflection on yourself how you keep your house so you're you're a renter you were a renter yes sir okay and then the owner showed up and what happened for a run out of time what's your question uh well my question is so i bought the house from him for 85 i gave him 10, uh, anyway, he's charged me 10 points.

So 10% interest. Yes, sir. And so I went to the bank, tried to refinance and stuff. And, or she said I could get first time buyers, but then he turned around and she's like, well, let's just refinance. And, uh, but then actually I got a couple, she told me my credit was zero. So I went and got a secured credit card, and then got a credit card, and I just put my internet in the credit card. Clifton, I'm out of time. What's your question? So should I wait until after the September 17th to see if the interest rate

would go down? It might move a little bit. It's not going to move much. You can go to Churchill Mortgage to get a mortgage with a zero credit score to refinance this mess if your credit you know if your credit is completely spotless and you have nothing on it and you have no credit that's wonderful they can do manual underwriting and they have a program where you can lock in the rate and if it drops they'll drop the, but it won't go up. And so then you don't have to worry about what the Fed is going to do and try to anticipate that

because the Fed doesn't actually set mortgage interest rates. They set the wholesale rate that banks loan to each other on, and it somewhat indirectly affects mortgage, but not really. It's not mortgage rates that they change. So if they change it on the 17th, it might not show up in mortgage rates for 30 days. So just go get a mortgage and get rid of this 10% and get you a good 6% 15-year fix. That's what you need to do.

Jade Warshaw, good show today. Well done. Thank you. Nice hosting with you, Dave, as always. That puts us out of the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. So