The Ramsey Show - App - Facts Are Your Friends When Facing An Uncertain Future (Hour 1)

Episode Date: July 20, 2023

Dave Ramsey & Rachel Cruze answer your questions and discuss:  Budgeting for your business on inconsistent income,  from the blog: How to Create a Business Budget How to prepare for the future when facing a difficult medical diagnosis, from the blog: 8 Types of Insurance You Can't Go Without A Debt-Free Scream from a couple who listened to The Ramsey Show for 30 hours straight, Fill out your Debt-Free Scream application for a chance to do your own Debt Free Scream! Why you should leave retirement savings alone when planning for large purchases in the future, What to do when you owe major taxes on a vehicle that was used as a tax write off. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Here's an EveryDollar deal just for our listeners: get a 14-day free trial PLUS $15 off your first year of premium. Click the link below and start budgeting today! www.everydollar.com/TRS Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Rachel Cruz, Ramsey personality, number one bestselling author and co-host of the Smart Money Happy Hour podcast, ever popular with George Camel, is my co-host today, also my daughter. Open phones at 888-825-5225, that's 888-825-5225.

Jennifer is with us. Jennifer is in Indianapolis. Hi, Jennifer. Welcome to the Ramsey Show. Hello. Hi, what's up? I have a question. So my husband and I own two small businesses.

That's our daytime job. And I'm starting a third one, but we're really struggling with budgeting for those businesses because they are not consistent income every month. And so knowing how to budget and our expenses, there aren't, there isn't much personal expenses because we are debt-free other than our property. And so I'm just struggling of how to get started and how to plan with the inconsistent income. And is this question more, Jennifer, for the businesses, how to budget for those specific small businesses or the money you're bringing into your household budget? Really for all of them, but more specifically the businesses. Okay. And are you and your husband, is this the only type of work you guys do?

Are these two businesses that you're running? Yes. And I'm starting a third one that is, I want to transition from my current role and I have discovered that there are no resources. And so I would like to fill a need for my current position and step out of that and work into this other business. Okay, I'll let you handle the business side. I can do the, I can help you with the household budget, though. So when you, so Jennifer, for you guys, you and your husband, y'all need to create, if you haven't already, obviously a pretty detailed budget for your household. And like you said, there's not many bills that have to be paid because you guys are debt free sure your four walls are covered, food, shelter, utilities, transportation. And then everything else underneath is prioritized line item wise by what's most important. And so for some months for you guys, if it's less than what you're bringing in, then you're going to have to say, okay, we're going to have to cut the bottom three line items in the budget or lower some of the amounts throughout the budget. So you kind of have a plan for the lower months. And then when you guys have high months, yes,

go and enjoy some of that, but also keep some of that aside. So on the low months, you can even pull from that fund as well. So it's a little bit of kind of gymnastics throughout it. But having that in place, having a prioritized budget is really important and then a fund to be able to say we can pull from some of this money that's not an emergency fund but just for those lower months to do what we need to do so that's kind of on the household side but i think dave's a little perplexed okay i'm the the business that you're running now what do you make yes i make a hundred thousand dollars a year for mine. Profit. Yes.

And you want to start another business. Why? So I'm a behavior consultant, and so I'm an independent contractor, and I have noticed a need in the business that I do, and so i'm looking to start something else that i would hopefully um transition out of the independent contracting and into this other um business okay so you're not in business you're just an independent contractor correct uh yeah by being in business you just mean you're 1099. You don't operate a business with business expenses associated with it. You don't have employees.

You don't have products. You simply work for someone on contract. Yes, sir. And you're calling that being in business. Okay, I got you. And you don't want to do that anymore. You want to do something else. Correct.

And what is it you want to do that anymore. You want to do something else. Correct. And what is it you want to do? I would like to have a subscription-based website. Doing what? Providing materials for people that are currently independent contractors. To help kind of supplement the work that they're doing. Because as an independent contractor, you've realized, oh gosh, I wish I had this. And a lot of people need that. So I could step in that space.

Okay. Okay. I want you to just work on that at night. That's what I'm currently doing. Just as a side thing. Night and weekend. That right now is worth zero and the other is worth 100K. So you're not going to transition out of that anytime soon correct to get to get your subscription up to 100k and

you get to quit doing your day job uh as a contractor it's going to be a while okay so let's just keep with that now why is your $100,000 irregular? Each month, I turn in billable hours, and so depending on schedules and things like that. Well, what's your worst month? It can vary. What's your lowest month? $8,000. Yeah, and you said you make $100,000.

$8,000 is $100,000. $8,300 a month is $100,000. $8,000 is $100,000. $8,300 a month is $100,000. Okay. So then my higher month can be upwards of $10,000. Okay. So your variability is not that much. You could lay out a budget easily on $8,000 and then just do minor adjustments where you have a better month. What's your husband make?

Around $160,000. So you have a $260,000 income to work with, and then you can adjust a little bit off of that. So you don't have a lot of variability, a lot of volatility in your income. Not so much in mine. In my husband's, it's more seasonal work. Yeah, but you can you can anticipate that i mean you can look up and go because we're not doing a budget for for november

right now we're doing a budget for july right now or august okay and he knows he knows right now what august is going to look like um yeah pretty close pretty close yeah you're look you don't you guys don't go to zero. You're making a quarter of a million dollars a year. You don't go to zero. So you make enough money to run a budget on $20,000 a month, $15,000, $20,000 a month. Yeah, and the inconsistent income. And they make the adjustments on the overages or the underages.

Yeah, that. And you guys just may be able to live on way less than that. So what's going to adjust is just how much you save per month, right? Exactly. And make it to that Yeah, that. And you guys just may be able to live on way less than that. So what's going to adjust is just how much you save per month, right? Exactly. It may get to that point too. So yeah, you guys are doing great, Jennifer. I mean, you guys are making incredible money. You're making serious money. And I appreciate the intentionality around the budget because I think for some people, when they are independent contractors or they're doing freelance work, there is this inconsistent income. A lot of people just write off a budget and say,

well, I can't do a budget because I don't have a consistent income. So I think the question is really good. But you guys aren't in dire. You should be fine even on your low months. You have a very consistent $15,000 to $17,000 a month. Very consistent that you could easily do the budget on that part. And I think your side gig, Jennifer, is awesome. I know

friends in a field similar to what you're talking about, so anything that can help them you see a need, that's when businesses and your passion really do help. So I encourage the work on nights and weekends of doing that. So I think that's exciting. Absolutely. This is The Ramsey Show. Rachel Cruz, Ramsey personality, is my co-host today. I'm Dave Ramsey, your host. This is common sense for your dollars and cents. A concept Congress can't grasp.

It's called The Ramsey Show. Thank you for being with us. The number is 888-825-5225. Aaron is with us in Las Vegas. Hi, Aaron. How are you? Good, guys. Thanks so much for having me. I really appreciate it. Sure. Our pleasure. How can we help? Well, my wife and I love the show. We've gone through FPU. We're in Baby Step 6 right now, so we're super excited about that. But a couple months ago, our situation changed. I'm baby step six right now. So we're super excited about that. But a couple of months ago, our situation changed. I'm currently in the process of being diagnosed with a very rare form of muscular dystrophy.

And so just the reason I say in the process, I've had a genetic test that's a possible match. My doctor is 90 percent sure. And I've done a biopsy. But next week, I actually find out the results of the biopsy. And so we've obviously done the baby steps. We're in a good situation that way. But I guess my question is, what insurance and what type of long term planning would you suggest in this?

And I guess, am I too late to get to the party to get insurance in this sort of situation now? Life insurance? Yes. Yes, you're too late to the party. Okay, all right. Sorry. And then how you plan for it would be based on I don't know anything about muscular dystrophy in this millennial. I mean, I remember like the telethon when I was a kid or something.

And that was I was one of the dinosaurs around the earth. And I don't know what this prognosis means for you. Do you or what do you understand so far? I know it's very rare there's less than a thousand people in the u.s that have what i have and um it's i'm fully functional right now but it's possible in the next 10 to 15 years i could be uh in a wheelchair and i could lose um breathing function so i'd have to have a respiratory device. Oh, Aaron, I'm so sorry. Oh, wow.

Thank you. And then following that stage, it probably doesn't end well, I'm guessing. It's very possible, yes. Does it continue to deteriorate, or does it plateau off with the breathing device? It can plateau, but more than likely it will deteriorate from there. How old are you? I'm 46. Okay.

So we're talking about 60 years old, give or take. Exactly. Okay. I'm sorry, man. It's hard to face something like that. Do you guys have kids? No, we do not. How's your wife? she's so supportive very very very awesome yeah she's great well i think one of the things i'll tell you from working with families i

don't know anything about the medical world except that um they call it practicing medicine for a reason. They're practicing. And so things, in other words, things change, and extra opinions and continuing to study and continuing to argue with the what's in front of you is good, not in a denial way, but just accept that that one guy says okay you're gonna be gone in six months and you go well maybe not maybe i'm gonna try this and you know so on so you know you're gonna you're gonna you're gonna become an expert on this dad blame it you know to be an advocate for yourself so i'm gonna tell you to continue to do that and don't just

accept one thing and walk away i don't think you were going to anyway, but second, third, fourth, and later on, uh, eight opinions just keep working the problem. Uh, now while you're doing that, uh, uh, there is, uh, I have perceived in others, not myself. I've not experienced this. Okay. So just like someone calls me up and says i've got a stage four uh cancer diagnosis and they're giving me four months to live okay that call has come in here over the years several times or i've actually sat with people in a room where they were telling me this stuff and they're they're uh already have processed the emotions and now are going okay what the flip do i do kind of thing all right so that's why you're calling so um in that case what

i found is is that facts are your friends and so there is a tremendous piece that comes from having your spiritual house in order number one but then number two uh getting your house in order financially and you say okay if this unfolds i got about this many years and we're talking wheelchair and then i got about this many years on a breathing device and if it doesn't stop deteriorating i've got this many years and so you you okay based on that i'm gonna lay out a plan and then if i get a different result, I'll change the plan. But if you go ahead and make sure, okay, I got a will in place. I'm going to investigate and find out and make sure Dave's right about life insurance. I'm going to say, this is our wealth

building plan. We're going to continue to pay off the house. We're going to do this and this and this. And you, you know, you, you, the more detail, it sounds ridiculous, but the more detail you say, given this diagnosis, this is the exact plan. Once that detail's in place, it gives you just like a release, you know, a sense of peace. But having the medical be chaotic and the financial future being chaotic simultaneously is almost more than some folk can bear so i'm going to encourage you to do what continue the journey you started with this phone call and that is really detail out exactly what how what is your version of the baby steps facing this rare for front form of muscular dystrophy, because it's almost chronic in that it's not a one-year or two-year diagnosis.

It's a 15-year or 20-year diagnosis, right? And today it is anyway. It may change next week, and it may change for the better next week. So facts are your friends. Details in the financial arena are not you being cold. They're giving your wife peace and you peace, and then you can turn back around and concentrate on being well. Does that make any sense at all?

No, it totally does. And just hearing about this, we found out in March, and like you said, it's about, you know, emotionally trying to register it and then trying to figure out what the facts are. And I feel like we're at that place right now. And now I'm going, oh, wait, I have to plan about the future now and figure that out, which is why, like you said, I called. Yeah, and it's a different future than it was in March. And truthfully, there may be a treatment that comes a year from now, you know, and then the thing changes again because you're not going to stop studying this. You're living it, you know.

Aaron, do you guys know medical bills? Have they given you guys any direction? Like your insurance, do you guys know financially at all what the costs will be at certain stages of this? We do not. It's because it's so rare. It's just being discovered sort of thing. I'm in a research study right now good it's putting me in loan to hopefully take care of some of the medical bills but also figure what this thing out and how it does in the

long term right yeah well i could tell you this you know continuing a big old pile of money in your 401k and a paid for house is still going to help the situation. So that part didn't really change, right? Right. I mean, if you live with this deterioration and disability, or you don't and you leave her with the situation, either way a big old pile of money and a paid-for house ain't going to be bad, right? True. So, you know, we could keep working four and six you know

the only question is in between like rachel's saying do we need to pile up some cash for interim treatments or uh treat you know we're going to fly to check us a vacu because there's a treatment there that's not covered by insurance heck i'm going man heck we're paying off the house get on an airplane let's go you know and we'll redistribute that cash in a different way out of the budget. And, of course, you're going to anticipate your income changing potentially as well as you go along. And so all of that goes with it. But just, you know, keep adjusting the plan. But the more detail the plan is, the more peace she's going to have, you're going to have.

And then you can turn your energy around to fighting the disease instead of fighting the money and that's what people that are like with a cancer diagnosis are doing as well so man i'm so sorry and aaron we're here for you we're not going anywhere if you need something you call anytime we'll and tell your wife to call if you for some reason aren't able to get on the phone. We'll help any way we can. Thanks for calling, man. I'm sorry. Rachel Cruz, Ramsey Personality, is my co-host today in the lobby of Ramsey Solutions on the debt-free stage. Greg and Lindsay are with us. Hey, guys, how are you? We're great, Dave.

How are you? Better than we deserve. Where do you live? Live in Knoxville, Tennessee. All right. Yeah, go Vols. That's fun. Go Vols.

Go Vols. Yeah, we're from all of us are from, well, some of us from over there. Rachel's husband, Winston, is from Bearden there. So, and I was born in Merville. So. There it is. Merville. That's how you say it.

That's how you say it. If you're a Yankee, it's Maryville for the rest of you. All right. Welcome, guys. How much debt have you paid off? Paid off $117,802. All right. And how long did this take?

14 months. Way to go, guys. And your range of income during that time? $162,000 to $198,000. Cool. What do y'all do for a living? We are both CPAs. Good.

You're killing it, too. Way to go. So what's the $11 do for a living we are both cpas good you're killing it too way to go so what's the 118 000 what kind of debt student loans student loans how long you've been out of school uh graduated four years four or five four years 2019 yeah good good for you guys good for you guys so what happened 14 months ago that lit these two CPAs? They got smiles on their face. Because you didn't have to pay the loans 14 months ago. Yeah, well, actually, I refinanced. It was all my loans. Well, our loans, but it was my loans.

But my loans. Yeah, but my loans. But yeah, no, it's kind of just started by we went to a trip to South Dakota, and that's where I proposed to her. At Mount Rushmore. Yep, at Mount Rush rushmore under the founding fathers that's very patriotic yeah and then we had a 30-hour road trip back and i started thinking what can we listen to i'm tired of our playlists and i was like i should listen to that show that i watched in college the dave ramsey network so we listened to it for 30 hours straight and we're like, we're cash flowing the wedding, we're cash flowing our

honeymoon, and we're kicking out this debt. So it lit us on fire. It was 30 hours straight. No joke. You canceled the wedding. Oh, we cash flowed. Oh, cash flowed. Oh, I'm sorry. Dave's like, they're eloping. Whoa, whoa, whoa, I didn't say

that. Okay, so you cash flowed yes the wedding cash flowed the honeymoon and decided all of that though in the car yep as you're listening all this yeah well two cpas they're gonna do budgets in 30 hours oh yeah by the time you got there by the time you got home the whole thing was laid out oh yeah had the budget in the spreadsheet already and everything you drive a minute i want to play in the spreadsheet already and everything. Yep. You drive a minute. I want to play with the spreadsheet. Yeah. So funny.

That's cool, guys. Yeah. So it did not take, I guess both of you are trapped in the car with me, God help you. And so, well, with us, probably. I mean, this wasn't that long ago. So it would have been Ramsey personalities, yeah. And so you didn't have to really talk one of the another into it both of you were on board oh yeah we were on board um yeah both feet in and we talked to each other and and you know it was

hard at first but just right when we got into it we were a hundred percent and you know didn't look back at all everyone kind of thought we were crazy i think a little bit but yeah beans and rice it out and um bottom shelf at the grocery store but you know it came and went and then right when we paid it off we were like well what do we do now it was it was our life for that how long have you guys been married then uh it'll be two years in November okay okay yeah so we actually we had that 117,000 that we shared as a part of our journey here because it's what we did together. But I paid off my loans before that road trip. And then we both paid off cars too before.

But we consider our true beans and rice journey. After you were married. Yes. She made me wait to propose until I paid off my car. I did. Wow. I was wondering if he thought I was joking or not. But he did do it.

So I guess he was really listening. So great. Oh my gosh. So you started like the newlywed journey, obviously doing this. So for most, for your married life, you've just known this life and then you've paid it off. And how does it feel? Like, are you like looking at each other?

Like, oh my gosh, we did it. We like actually did it. Y'all are so like light as you're talking about it. For some people it's like, you can feel the weight of the sacrifice. Y'all are like having fun while doing it. It seems so just, I don't know. Y'all seem so light with it.

Yeah, it really was such a fun journey. I look back on it with so much emotion. It was just such a sentimental part of our story. And so I think just being up here, we're so happy to be here. And although it was a lot of hard work, but it's a lot of laughs too. I mean, what was the hardest part? Yeah, I would say the hardest part for me at least was definitely, you know, we were making friends at our church and really wanted to build relationships with our friends. And, you know, a lot of things that they like to do is got to eat and stuff like that. So we had to say no, and we were really comfortable with

saying no, but it didn't get easier. You know, as time went on, it's just a matter of explaining to people like, this is our, our journey right now. This is our chapter in life. And everyone was super supportive, but some, some weeks you wake up and you're like, I make all this money and I feel like I'm not spending it, but we both knew knew the long long-term play and it was for us yeah that definitely was the hardest part I think the hardest days for me there weren't too often but the day is just when you're like oh I'm four or five years out of college I have my CPA license and then we make 200,000 a year yeah but you're getting on your knees to get like bottom shelf shampoo like the ding cans and everything you know the cheap food so um i guess anybody who else might feel that way i definitely say stay off of stay off of social media because

comparison was a big thing so i think the joy yeah we really unplugged there and it helped us really just totally stay plugged in so for sure so even with friends in the social aspect you know you yeah they were all like of course the go-to is like yeah let's go out to dinner right so did people did y'all switch it up for other couples listening? They're like, gosh, we're going to get on this journey and they may even have little kids and they're like, oh, is it going to be worth it? Like what were things that y'all did that you were like, oh yeah, we can still have fun and be newlyweds and it's still exciting and we don't have to spend a ton. I think one of the biggest things we would invite people over and have like a movie night,

we'd make popcorn, make dinner, you know, just know just get creative um yeah hiking and just being outdoors so we actually found that being on the debt-free journey we got more in shape because we couldn't eat out so much so it kind of leached into other areas of our life which was pretty nice so well you got the smokies right there to hike too yes yeah very cool you guys all right now two cpas you know that the uh number two career of most likely to become a millionaire is cpas and you guys you guys got it squared cpa squared here so uh very you guys are really on track it's pretty incredible to be baby steps millionaires and what do you tell people the key to getting out of debt is when you look back on it? Yeah, I would say you can't be 50-50.

You can't have one foot in, one foot out. You've got to, you know, look at your partner, your spouse, and just be all in. And that means you're all in. You're not going to, you know, spend money willy-nilly. You have to really just dedicate yourself to it. And, yeah. Yeah. I think the fact that to really just dedicate yourself to it. And yeah. Yeah. I think the fact that we were both in it together made a huge difference. I can't imagine not being on the same page. That was a total game changer for us. And then, yeah, I think

also what Greg said, I can't imagine pulling off what we did if we were lukewarm about it, because it was kind of, it felt almost easy for us because we knew the answer to every question along the way. It was always no, like no spending. spending don't do this don't do that and i can't imagine if we were lukewarm and it was kind of a consideration that'd be so much decision a lot of stress right yeah definitely lack of clarity is stress it's anxiety yeah way to go you guys i'm so proud of you who was bragging on you along the way friends and family i would say friends and family but each other i mean at the end of the day that's that's what it comes down to your partner the person that's going to do it alongside with you so yeah well done you guys we've got the uh live and give box for you it's the baby steps

millionaires book so you can read about yourself you're getting ready to be one and uh the total money makeover book you you've lived it already you can give it away or whatever same with the financial peace university membership if you haven't done that as newlyweds you probably ought to still do that it's not only about getting out of debt and um as cpas you'll actually find some things that you might learn too it's not all about the numbers. So well done, you guys. We're very proud of you. You're amazing. You're heroes. Thank you. So very, very, very cool. Greg and Lindsey, Knoxville, Tennessee.

118,000 paid off in 14 months. That's after they restarted the beans and rice, and they did some stuff before they got married. Making 162 to 198. Count it down. Let's hear a debt-free scream three two one i love it man so good what a sharp couple nobody's gonna be surprised when they're millionaires by the time they're 30.

It's the one track mind. That's what I love about them. It's like there's nothing else. No, no, no. This is what we're doing. It's that focus intensity over time that we talk about. It gives that momentum. I couldn't listen to me for 30 hours in the car.

Oh, my gosh. Try being your daughter. I'm just kidding. I'm kidding. Thanks for joining us. Rachel Cruz, Ramsey Personality, is my co-host today. Hey, if you're a new listener and you're trying to figure out all this lingo you hear around here, like baby steps and where you are in the process and what we think your next best step is and all that, click the Get Started button.

It's a free, free process at RamseySolutions.com. We'll help you figure out where you are and where you want to go next. Get started at RamseySolutions.com. John's with us in Canada. Hi, John. Welcome to the us in Canada. Hi, John. Welcome to the Ramsey Show. Hi, guys. How are you doing?

Better than we deserve. What's up? Yeah, thanks for taking my call. So my wife and I just got married just over a month ago. We're looking at buying a house within the next couple years. Good for you. Thanks. for you. Um, thanks. Thank you. Um, so our question was, uh, we have the option to, um, take out up to 35,000 out of, uh,

out of my retirement. Um, if you pay that back within the next 15 years and then there's no penalty on that. So you can take out up to 35,00035,000 and use that as a down payment, as part of your down payment for a home. So we're just wondering if we should take that money and use it or if we should just leave it where it is. What's your household income? About $140,000.

And how old are you? 25. Okay. John, do you And how old are you? 25. Okay. John, do you guys have any other debt? Any consumer debt? No other debt. Okay. And any cash savings?

So we have about $170,000 plus about $30,000 in the retirement. So it's totaling about $200,000. So we're just wondering if we should use the $30,000 in the retirement. So it's totaling about $200,000. So we're just wondering if we should use the $30,000 in the retirement as well, or if we should just stick to the $170,000. That's great. Well, you guys have good, great cash savings. Where did you get $170,000? You know, I don't know.

Just here and there. Piles up here and there, I guess. Was it mostly yours that you're just saving, or did you guys, after you got married, that's combined, she was saving too? Yeah, we're both pretty good savers, and so we've been out of school for a while. No, I mean, you're incredible savers. You're like world-class superhero savers. I mean, you're 25 25 you just got married and you enter this

conversation wanting to borrow 35 000 or take 35 000 out and then you come along and drop this bomb on us that you got 170 grand laying there dude you need to leave your retirement alone put the 170 down or however many other hundreds of thousands you can save between now and the time you buy a house put all of that down and then go ahead and get the house paid off quick but let's not unplug the income that the great growth that you would have on the 35 000 see that's what you're missing out is the the uh uh the the money that that 35 000,000 would have made. That's what you're losing. Because I think I'm understanding, and I don't know,

I'm not an expert on Canadian retirement, but I think I'm understanding from you, you can do this without a penalty, right? Yeah, so you take out the money and then you pay it back. If you pay it back within 15 years. Yeah, I heard that part, but there's no penalty. Yeah, but what you do lose is all the money you would have made on the $35,000 as an investment. Yeah, I guess we were just thinking if

that money added to the deposit on a home would save us I don't know, the same amount of money or more or less. No, because your home mortgage rate is lower than your investment return. Okay. So no, I'd leave the investment loan because dude you're super savers you're gonna knock it out you're gonna save another 35 000 while we're

talking you guys are amazing so yeah let's let the investments be the investments and then you guys be the super savers with the down payment and then reach over and pay that house off and work baby steps four through six which is retirement saving 15 and throwing everything else at the house and you're going to get this house paid off in no time yeah well done john well done wow pretty amazing yeah you're just trying to get that last little bit of manipulation going here and there's no need for it yeah because you are the secret sauce my man not that little bit of manipulation tim is with us in phoenix hey tim what's up hey dave and rachel um i had a quick question for you so i'm on my very early stages i've read the book once um working on my second time through i would say i'm on step 0.5 i'm in the the middle of really putting together and figuring out what my debt actually

is and just kind of planning for how I'm going to go about this. The reason I called in was I have a fairly expensive truck that I bought last year and I bought it as a business vehicle using, you know, a tax write-off where it's over a certain weight, and I can write off the whole vehicle. Now, I'm ready to, you know, go all in on this, and get myself, you know, like what I guess I would call like a junker car, but something reliable, and try to get, you know, no payments going. But when I sell this vehicle, I'm going to get hit with all of those,

um, you know, tax write-offs I got last year as, as income this year. Um, and I don't even know if it's the right decision to do that. Plus the upside down this you get from, you know, uh, I would say I'm probably 6,000 upside down. Okay. So you owe 6,000 more on I would say I'm probably $6,000 upside down. Okay, so you owe $6,000 more on the car than it's worth. Correct. Okay, and how much do you owe on it? $62,000. Okay, and what's your household income?

I make about $225 a year. Okay, and what other debts do you have? So in total, that's part of what I've been doing here. In absolute total, and it's kind of a scary number, especially because I have it laid out here, I am $666,670.91 in debt. Okay. Does that include mortgage? How much of that is mortgage? How much of that is mortgage? $477,960. So you've got $200,000. You've got $175,000

in debt. And you make $2,000 what? I make somewhere around $225,000. It ranges. I am a mission guy, so as long as I do good, it stays good, but it can change. Are you single?

I'm not. I am married. How many kids? Three kids. Okay. How does she feel about all this debt? That is something where I am having a little, I mean, she's game, but I don't think she's all in yet. No, you're not even all in.

You're trying to figure it out still. That's okay. We'll give her a minute, okay? Yeah. Yeah, I think the toughest thing for her is how it affects a kid's life, how we eat, how it affects what we do,

different things like that yeah well um we're coming up on the clock so let me jump in here hard okay um yeah i think you can probably keep the truck and just pay it off as a part of paying off two hundred thousand dollars worth of debt but you're 175 000 worth of debt but you're going to have to commit to do that in a very short period of time and that's going to mean about two years worth of hell for your for your lifestyle your lifestyle that you've been living has got to go completely away because we're going to use almost all of your income to clear 175 in two years in other words we're going to put about 80 grand 90000, $90,000 out there a year

out of your income on debt, right? Mm-hmm. And then you'd be debt-free except your house in two years, but there's going to be no vacations and eating out during that time, which is going to involve your spouse being on board. And the kids will be fine. You've got to get more details and understanding before you're going to want to do what I just prescribed.

So we'll help you get the two of those things going, you more details and her as well. It's called Financial Peace University. You may have heard us talking about it. It's nine lessons, and we're going to give it to you for free as our gift because I've been young and broke like you. And you are broke, sir. Oh, yeah. You make a lot of money, but you're broke. And so you guys really need to clean this up

because you have the potential to be very wealthy in the future but not living the way you're living now. So hang on. We'll give you a copy or we'll sign you up for the class. You and your wife go through as our guest. It won't cost you a thing. It's called financial peace university the only thing you have to do is promise the call screener that you will

actually attend the class if i give it to you for free you don't get to go for free unless you make that promise because you got to go and you got to actually do the class and go watch the lessons with your wife and the two of you discuss it and then go change your life. You're overdue to do that. Hey, it's Rachel Cruz. If you love the show and want a deeper dive on your money journey, we have a weekly newsletter that gives you trending and helpful articles and tips on following the Ramsey way. Just go to ramsesolutions.com today to sign up for our newsletter. Again, that's ramsesolutions.com to sign up for our weekly newsletter.