The Ramsey Show - App - Financial Diligence Will Change Your Family Tree (Hour 2)

Episode Date: September 14, 2018

The show about you

🎵 Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and a paid-off home mortgage has taken the place of the BMW as the status symbol of choice. This is the Dave Ramsey Show. We're glad you're here. Open phones at 888-825-5225. 888-825-5225. 888-825-5225. You jump in. We'll talk about your life and your money.

We teach you God's and Grandma's ways of handling money. Common sense. When you handle money using these basic principles and you do it over an extended period of time, you will see an inordinate level of success in good times and in bad times. Whether there are horrible things like storms that are bearing down on us everywhere, literally or figuratively, or whatever else happens, we teach you to live on a budget, a written plan. Jesus said, don't build a tower without first counting the cost,

lest you get halfway up and you're unable to finish, and all who see you begin to mock you and say, this man began to build and was unable to finish. If you manage money for a company called you incorporated, and you manage money for you incorporated the way you manage money for you now, would you fire you? If the answer is yes, then please don't pray and ask God to bless you with more money. If you're mishandling it, Scripture's real clear,

he's not going to send money to someone who's mishandling it. Have you ever read the parable of the talents? It violates common sense. So, you know, you're not going to have a sudden financial windfall that saves your life when you are disorganized and not doing a budget, not living on a plan. When you start living a plan, that diligence, you're going to see things change. You need to save money for emergencies, to buy things so you don't go in debt when you buy them, and to invest and change your family tree and send your kid to college. But you've got to save money, and you have to do it every month, and systematically and intentionally, it doesn't just occur.

No one wakes up and goes, I have a million dollars. Wow, I wonder how that happened. It's like no one wins the Super Bowl and goes, whoa, how did that happen? No, it's years and years and years and years and years and years and years and years and years and years and years of diligence and throwing a football. And then you, you win the Super Bowl, maybe. But if you do no one, you don't know, they never interviewed somebody after the Super Bowl's over and they go, I have no idea. It was just an accident. I was just driving along in a car. And now here I am the quarterback of the winning team. I had no idea this was going to happen. No one does that. It's an intentional act over a long period of time, a series of habits and processes and practices that get you a shot at maybe being in the big leagues, right? Same thing is true with money.

Save money. Save money. No one accidentally changes their family tree. And, you know, you need to avoid debt. The borrower is a slave to the lender. When you don't have any payments, you know what you've got? Money. I'm amazed at the number of people that think that they're intelligent and

sophisticated that walk around with a car lease and credit cards and car payments, and they borrowed money for their freaking vacation. Lame-o. They can't even afford to go out to eat and pay for it. Lame-o. I mean, really, absolutely crazy out there. And these are people that are sometimes well-educated but stupid. I'm one of those.

I've got a good education, but I was stupid. You can do that. It's possible. You've met well-educated, stupid people before, haven't you? I have. Some of them are professors. I mean, it's just nuts out there, you know? And, you know, you need to learn to be unbelievably generous.

God loves a cheerful giver. People aren't generous, they very seldom win with money. Very seldom win with money. And there's all these other things. Don't, you know, don't put all your investments in one basket. Spread your portions to seven, yes, to eight, for disaster may come upon the land, says Ecclesiastes. That means diversify. Don't put all your money in one company or one stock or one thing or one bank because you're asking for it.

Spread it around. Risk goes down when you spread it around. Money is like manure. It grows things when it's spread around. Left in one pile, it stinks. It works. Don't be cosigning. Cosign.

If you're not going to go in debt, why are you cosigning for a broke person to go in debt? Little Johnny needs a car. I'm going to help Little Johnny. You think it's helping him to get him in debt? Both of you are dumb. Little Johnny needs a house. Everybody needs a house. I'm going to cosign for my kid to get a house.

You're stupid. You know, I know this. It says it in the Bible. It says you're stupid. Proverbs 17, 18. It says in the contemporary English version, the CEV version of Scripture, Proverbs 17, 18 says, one who co-signs for another is stupid. That's what it says in the Bible.

Now, if you want to read one of the softer versions, you can read like the New King James. It says, One lacking in sense signs for another. You want to do all the versions? We can do them, but we don't need to right now. The point is, it's dumb to cosign. And when you cosign, you're stupid. Because the bank who loves to loan money more than dogs like food,

I mean, a bank who, their existence is to loan people money and get them into debt. Doesn't want to loan this goober money. But you're so stinking smart, you say goober needs a loan. And so I'm going to sign up with old goober here and hope goober pays. Listen, if goober was going to pay, the bank would have already loaned him money. But now you are the goober because you get to pay goober's payments. And it's your grandson on his truck or it's your daughter on her house and you thought you were being a blessing and you weren't

you were cursing them you were getting them into debt they couldn't afford to do new data coming out a friend of mine sent me this email this morning a company called studies mortgage trends. 23% of all mortgages taken out last year had a co-maker on them, a co-borrower on them. One-fourth. Wow. That's a whole list of stupid. Now, the conclusion of the economists in this study, of this data, was that that means that all those people

are getting co-signers because housing is so expensive that poor little johnny millennial can't buy a house without his daddy helping and that's just really not the case because here's the actual data okay because i actually do this for a living this is what i do co-signing is a lot of this but it said co-making loans meaning it's not a husband and wife but i don't know if you know this piece of information or not but statistically more people live together in america that aren't married than live together that are married today and so this trend of co-borrowing what this is is you people that are shacking up with your shack up partner you're

both signing on the loan and that's showing up in this data now that's also stupid because when you break up and you get a divorce and you're married the judge will dictate how this mortgage is handled when he just decides he doesn't want to pay anymore and leaves baby you got the loan or vice versa so you don't have a marriage you have what's called a partnership in business and law and it's's a general partnership, which means if one of you doesn't pay, the other one's fully liable. And so he goes bankrupt, darling, you're left with the whole bag of cookies. Because you're stupid. And you signed up for a house with somebody you're not married to.

That's stupid. It's going to cost you. You're going to get your head taken off. So if you want to buy a house and somebody live with you, you just buy the house and live with them. If you're going to do that, that's the only way to do it. I'm not recommending that as a Christian, but aside from that, legally and morally, I mean, legally and financially, you're straight up stupid to be signing loans with people to buy a house unless you're married. There you go. See, that's how you win. You learn stuff like this.

This is the Dave Ramsey Show. We need to talk about something you've been hiding. It's your smile. Your teeth aren't straight and you think you don't have the money or the time to get them fixed. You think your only option is to go on covering your teeth every time you laugh? Well, here's some good news. With Smile Love, you can have a completely confident smile, pay thousands less than what you expect, and do it without all the appointments. Here's how it works. We'll send you a kit with simple instructions to make molds of your teeth at home. You send that back to us. One of our dental professionals evaluates your case and creates a plan

that includes a preview of how your teeth will look when you're done. If you like what you see, we produce your perfectly clear aligners and mail them to you. In a matter of weeks, you'll start loving your smile.

Smile Love's proven streamlined method is the most affordable option for straightening your teeth. We're talking about saving you thousands. Order today at smilelove.com and use the promo code Dave to receive $100 off. SmileLove.com. Promo code Dave. Thanks for joining us, America.

We teach you to live on less than you make, a concept Congress can't grasp. This is the Dave Ramsey Show. Martin is with us in San Antonio, Texas. Hey, Martin, how are you? Hey, Sarah, thank you for taking my call. Sure, what's up? All right, here's the quick and the down and dirty of it. Me and I, I'm 41 years old.

My wife and I lost almost everything in the financial crisis, even though we did live pretty close to your rules before knowing your rules. Without that. Ten years ago? Ten years ago. And we're saving up for a house right now. Wait a minute.

Ten years ago you lost everything? Yes. Okay. And you've not recovered at all in ten years? Oh, no, no, no.

We've recovered almost everything. Oh, okay. We've recovered almost everything. So we've knocked out, we were living pretty close

to your baby steps even before we knew what your baby steps were. We just had bad timing and understanding of the market at the time. So we are done with baby steps one, two, three, and I just retired from the military, and we want to buy a house, and I'm saving up.

We have the 36 months. We have about $50,000 right now saved for the home, and I was unemployed until just a couple days ago. I just got a new job. I started on Wednesday. Awesome. Yes. So between my military pension and the VA, the salary that's going to come with that is going to be about $2,500 a month. That's after taxes without any other employment.

Plus your new job. Yes, plus my new job. I'm making $36 an hour, which comes out to about $70,000 a year. Awesomeness. Good. Yes. Now, I guess I want to make sure we're doing everything properly, and I believe that we are. I'm looking at right now, of course, my wife also works,

and the goal is to put away as much of my income as possible, and only her income and disability will be used for living expenses. Okay. That would be fine. I don't care how we allocate it. What I prefer to do is just put all the income in one pile, and let's live as frugally as we can live out of that pile and throw the rest of it towards the house plan um so what does your wife make uh she makes after taxes about 38 000 okay so she's making about 48 a year roughly 50 50 a little

okay so you got about 150 000 household income now. Okay. So what can you live on? We can get it down to both cars are paid off, everything's done. I guess I'm going to be looking at once we're trying to get up, we have 50 right now, we want to get to about 90. Okay. So how quick can you save that 40, make it 150? I would say in a year. Yes, sir. Okay. That's the current game plan. I'm telling you the plan. I want to make a year. Yes, sir. That's the current game plan.

I'm telling you the plan. I want to make sure I'm doing it properly. That sounds right. I don't hear any issue. You're 100% debt-free. You have your emergency fund of three to six months of expenses. Above that, you've saved $50,000. You want to save another $40,000 out of $150,000 income in the next year. Then you will buy your house with cash. We're not going to buy totally cash. We're going to have a down payment. in the next year, and then you will buy your house with cash, and you will then... We're not going to buy totally cash.

We're going to have a down payment. We're going to pay... Okay, use the 90 down payment. Once we're in the house, we believe we can have it paid off in about eight years. Okay, perfect. There's not any plan wrong with that plan at all. That's a great plan. I would execute that exactly. Well done.

And thanks for your service to the country, by the way. Johnny's with us in Colorado Springs. Hey, Johnny, how are you? Hey, Dave, I'm doing well. Thanks for taking my call here. My wife and I are on the baby step plan and we're on step number two. But unrelated to that, my parents divorced and separated when I was really young, and they both remarried. And my mom recently and unexpectedly passed away. And so she remarried, and the guy that she remarried is obviously the executor to her estate. And he's been really quiet, haven't really heard a lot from him,

and I'm not really sure what to do in terms of, you know, looking at her will or trying to figure out kind of the starting process for, you know, what is supposed to be happening with her belongings, with her assets, kind of with everything. And I'm really just not sure what to do. And so I haven't, you know, he hasn't really brought up. How is your relationship with him? Non-existent. So I really had no relationship with him, which really makes that even more challenging.

Was it because they just didn't speak to you? Pretty much, yeah. So kind of when I was younger, I kind of separated from my mom and lived with my dad. And then from there, I hadn't really had a relationship with him. So it makes it kind of confusing, and I don't really know. Do you have any idea if you're in the will? I do know that I'm in the will. So he had mentioned that to me.

Oh, you've talked to him then? I have. I have. So I've reached out to him, again, to try and connect with him, see how he's doing, you know, just try and see what's going on. Okay. Well, how would it sound if you did this? If you called him and just – I assume you're not in the same city. We actually are in the same city.

We are. Go to coffee then. Everything is – you lose more in translation on the phone or email than you do any other way. Body language helps a lot. So you can just chill this. Could we have a cup of coffee because this is an awkward situation, and I'd really appreciate just a few minutes of your time. Thank you.

Please. Okay. Then sit down at a cup of coffee, and it just sounds like this. Look, this is really awkward because we've not got an ongoing relationship. We're nice enough to share the information that I'm in the will, and I appreciate that, and I don't want to overstep my bounds. Obviously, your relationship with my mom was a stronger relationship than my relationship with my mom, right? Right.

So let's just call things what they are and go, so I'm trying to be reasonable and nice and everything, and I just want to know kind of what's going on. What is reasonable in your mind for me to ask? Like, could I see a copy of the will? Would that be okay? Or what do you think you should share with me? And let's just talk about this and how I can not be a problem to you, but also be getting some communication with you. And just sit and talk to the guy.

And he'll probably go, okay, yeah, this is awkward as crap, you know, because, I mean, there's all this garbage in the air, you know, in the relationships and the divorce and all that stuff, right? And when you wore a younger man's clothes, the way you acted and so on, right? All that kind of stuff. And so all that's in the air. Let's just call it what it is. And sometimes it just takes all the tension out of the room if you just say it all out loud in person very calmly and quietly and go, and how can I make this easier for you and still get some communication on my side?

And let him talk. He may just go blah and tell you everything. And sure, I'll work with you. I'll be happy to give you a copy of the will. I don't like conflict. I don't want to do anything wrong. I just want to execute this will. And, you know, that's probably what he's going to say.

Unless he's just a combative person, is he? Well, and that's where I struggle because I want to say, I kind of want to answer yes and no to that question. He can be and then he cannot be. So sometimes he's really easygoing. Let me tell you when he was combative. It's when his wife was attacked. Right.

Yeah, I mean, it's a challenge. Yeah, when his wife was pissed off, that's when he was combative. And if you just go in and you lay all your weapons on the table, so to speak, and it's like, hey, I'm not here to fight, you know, truce. I'm coming in under a white flag here. Then he's probably going to react that way. He probably bowed up because he felt somebody in the household felt attacked at that point that's probably when you saw that side of him yeah and so it's you know it was a challenge for

me because i i really you know i didn't have any pre-existing relationship with them so now i have to come together and again um it's a challenge for him too too, by the way. He's got to deal with his stepson who had no relationship with his wife but is in the will. He's got to deal with that. That's a challenge for him, too. Yeah. So he's feeling the same tension in the air. That's what I'm saying. If you'll sit down over a cup of coffee, I think you can let the air out of this, and it'll calm way down and take the tension off of it.

And then just be easy to work with for goodness sakes but usually he'll probably give you a copy of the will and tell you what it says and then you just go okay and what do you think the time frame is on this and is there any of her uh personal items that you would consider letting me have as keepsakes if that's of interest to you and just ask and you really have no rights much. He's the executor. He's supposed to execute what that will says and nothing more. And you're not owed a lot in this scenario. So just go in under a white flag and let the air out of it, and I think you'll get a good result.

Ultimately, in most states, when the will is probated, it becomes public record, so you probably can get a copy of it then anyway. But let's just try to do this on a real relational level for a change in this family. Okay, things are getting pretty weird out there. I thought the Equifax breach was bad enough. It exposed the personal financial info of half of all Americans. Now we have breaches affecting almost every U.S. citizen, and the data stolen is more personal and equally dangerous. One company had over 230 million consumer files hacked,

which included not only the home address, but info related to religion, pet lovers, smokers, you name it. And the businesses were not any luckier this time, with 110 million files hacked. It really is no longer a matter of if, it's when you'll become a victim. That's exactly why the only plan I've ever recommended is through Zander Insurance. They cover all types of identity theft for families and businesses, and they take over all the work if you become a victim. I use it for my family and my entire team. Call 800-356-4282 or visit Zander.com. That's Zander.com.

Thank you for joining us, America. It's a free call at 888-825-5225. Abraham's with us in Fort Worth, Texas. Hi, Abraham. How are you? Hello, Dave. How are you? Better than I deserve, sir. How can I help? Well, I'm excited to hear that better than I deserve. Dave, I've got a collection call from american express

and they said and so i stopped paying because i'm not working and i was paying them ten dollars i think the payment was 40 and so i had two phone calls from them and they said give us well we can take the money out of your account there's actually i said no i'll send you the money okay i'm having trouble hearing you're breaking up you said what now you said you said you owe them money you're paying them ten dollars and then what happened okay so the payment was forty dollars okay so i'm not working i, I sent them 10 for two months. And so I get a phone call. They said, okay, you're behind. And they said, give us, let us just go ahead and take $25 out of your account

since you are behind. I said, no. Good. And I said, because I've listened to you. And so I said, I'll send you the money. So I get a phone call today. They said, okay, well, give us access and we'll take it out i said no i will i will do it myself i'm not giving you access okay so what what i mean what do i do about this okay you don't give them access and you may

you get don't give them access and you mail them a check here's the thing it doesn't really matter what you do until you pay them off they're gonna whine right and gripe because you're not paying them what you've agreed to pay them you know right and so no do not allow american express to have access when you are in collections with them to your checking account they will clean you out. They lie. Right. You can tell they're lying if their mouth is moving. Right.

And so, you know, they're just scum. And so, I hope I wasn't unclear. You were doing the right thing. Now, here's the thing. You're not working, and how much do you owe these guys? I owe them probably, I don't know, two thousand bucks maybe okay okay but so what is your what is the the answer to the equation is income and paying them two thousand bucks and that makes these people go away for the rest of your life thank you jesus right so what what is

the process what's your career goals what What's your working situation? Tell me about that. Well, I'm not working right now. Why? Well, I'm looking for a job. Okay. All right. What did you used to do? I used to drive for Uber,

and so I quit that because it was just not panning out for me, and so, and I did work at a call center for a little while, so, and so now I'm looking, I'm just looking for something else. And how long have you not been working? About three months. And how are you eating? Well, I'm eating because people help me out okay wasn't uber at least putting eating money on your table well it's it i mean some days are good some days are not and right now you got nothing but no good days you're right okay so while you're doing nothing but no good days.

You're right. Okay, so while you're doing nothing, you might as well be doing something. Right, you're right. But with Uber, the mileage that I was putting on my car was just unbelievable. And so I didn't see the sense in doing that. Okay. Then you need to find something else today that you're doing to make money. You can deliver pizzas every night and make $1,500 a month while you're looking for jobs during the day. Right.

And you can be doing that job by the end of the day. Someone will hire you to deliver pizzas by the end of the day. Someone will hire you to deliver pizzas by the end of the day. So once I do that, how do I start to manage my money and budget? Because that's what I don't really have a handle on. Well, the first thing we have to do is create some money coming in so there is something to budget. And that's looking for a full-time gig. Even though it's not a perfect gig, you've got to get the wolf away from the door. You've got to get back up on survival mode going ahead, okay?

And so we've got to get delivering pizzas or Uber or something by the end of the day today. And that puts $1,500 in the pie. Where are you living? No, I mean, how are you living? How are you paying rent? Who lets you live for free? I'm sorry?

I'm staying with somebody. Okay, so you've got a friend that's just letting you hang out yeah okay cool so you don't have rent costs today so as soon as you start making money what you've got to do is put gas in your car food shelter clothing transportation and utilities once you've taken care of those basic necessities of life in your budget and you start building up more and more money because you're doing more and more work, then you start paying down your debts. How much debt do you have other than Amex? Probably about $100,000.

On what? Credit cards. Credit cards. Credit cards. Okay. And how did you run up $100,000 on credit cards? Oh, well, doing what you always talk about, being stupid. Were you not working? Well, I was working, yeah, I was working.

Okay. Yeah, I was working. Okay. Yeah, I was working. Okay. So let me propose something to you, and you tell me if I'm wrong, okay? I think it might be that you're not working much because you're so overwhelmed by this that you don't feel like you're going to be able to get out even if you worked your butt off. Yeah, that's true. There's kind of a hopelessness mixed in with that much credit card debt.

How far behind are you with that credit card debt? I am just about two months behind. Okay. And how old are you? Fifty. Fifty? Yes. Five-zero.

Okay. And do you have a degree? Well, I went to electronic school for two years. I used to be an electronic technician years ago. So if you could be anything you wanted to be and we could snap our fingers and blink our eyes and you would be that, what would you be today? What would I be today? Career-wise. Probably, I guess, working at some call center maybe.

I mean, I've managed some call call center, maybe. I mean, I've managed some call centers before, and I've made good money managing call centers. Oh, managing a call center. Yes, sir. All right, good. That's not bad. All right. What's the best you've ever made doing that?

The best I've ever made was $100,000. Good. Okay. All right. Well, if you can get back into that role over a period of time uh you can clean up your debt really fast couldn't you yes okay but there's a lot of other stuff going on in your life here dude and uh this the credit card debt and the other things are the phone calls you're getting are blistering you and they're overwhelming, and it's kind of taking a little bit of your confidence away.

I remember when I went broke. I was a little younger. I was 28. But it took all the swagger out of my step. I lost all my confidence for a little while. That might not be you, but that's how I felt. That's mean. That's mean because I feel like you're my uh little brother big brother okay all right

well you can do this so what you need what we've got to do is what i would do is set the credit card debt aside mathematically and emotionally for a little while and if i were in your shoes abraham i would concentrate on abraham because dude you're a guy who's made a hundred thousand dollars a year before that means you're not stupid and it means you're not lazy. But you are off the rails right now. And so what I'm going to do is I'm going to work my tail end off. If I'm you, I'm going to take like 16 jobs and just start piling up money. There's something about activity and a little bit of traction that starts to give you your confidence back a little bit at a time.

And then land yourself back in. Even if you start working for free at a call center, just get your foot in the door and prove that you're a stud again and get yourself moving. But let's get some income coming in, even if it's stupid income for a short period of time. And I don't care if you're working 80 hours. Right now, you're spending a whole lot of time at a pity party. And I don't blame you.

I understand how you got there. I was there, too. But you can do this. And I'd make sure you're plugged into a good local church as well while you're doing this. And don't allow Amex to have electronic access to your checking account in the meantime. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ

to share their major health care costs. Christian Health Care Ministries is the original health cost-sharing ministry. A Better Business Bureau-accredited organization, CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Health Care Ministries has done for over 35 years, and our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org.

Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thanks for joining us, America. It's a free call anywhere in North America. The phone number is 888-825-5225. Natalie is, or Natalia, I'm sorry, is with me in Sioux Falls, South Dakota. Hi, Natalia. How are you? Hi.

Hey. I'm doing good. I had a few questions. I am trying to get into this out of debt, I guess, but I'm kind of looking into it and I have no idea where to go from here. I know that you suggest the baby steps and every dollar budget, which I have done or started to do. Good. My yearly income is like $31,000. Mm-hmm. And I think my debt is $25,000 to $30,000 right now.

Mm-hmm. And I've cut a lot of my expenses out, like eating out. I've got rid of my cable and my internet. I picked up a second-time job. Mm-hmm.

Good. How much are you making it your extra job um that i don't know because i just recently started that what are you gonna be doing um i'm a waitress there okay all right cool how many nights a week um right now they have me at three okay cool and what. And what kind of debt is your $25,000 to $30,000 in debt? I ended up, well, before I became a Christian, I was cohabiting or whatever with my boyfriend at the time. But we were kind of living like a married couple. So we purchased a car together and we purchased like a few things that we opened a credit card together um so he left but he made sure that he ran everything up and then i ended up handing the car over because i couldn't afford it anymore so now i have the repo charge on my

credit score and um the credit cards. And how much of the $25 is the repo charge? $15. $15. Okay. Is that what was owed on the car at the time that they took it? I am not too sure. I gave him the car because he said that he was going to pay it.

And he didn't, and they repoed it. Yeah. Okay, so it's got his name on it and your name both, right? No, just mine. Just yours. Oh, this guy really played you. Okay. And I'm so sorry.

And how old are you? I'm going to be 27 in October. 27, okay. Well, there's two numbers on the repo. Number one, the first number is the total amount that was owed on the car. Do you have any recollection or any paperwork on the car? Any recollection of what you paid for the car when you bought it? I bought it for $32,000.

Okay. And how long did you have it? Two, three years. Okay. All right. The $15,000 could be either figure. I don't know what we've got. So anyway, the total that you owed on the car at the time of repo,

sometimes they turn that number in, and that is not what you owe because they sold the car for some amount on a repo auction, and that has to be credited to you okay so let's say that they took the car and you owed 22 000 on it and they sold it for seven the difference would be 15 and 15 would be the actual debt you do owe now okay but if they if you only owed 15 on the car whatever they sold it for would be reduced. That amount would be reduced by the amount they sell it for. Does that make sense?

Yeah. Okay. So we're going to set that number to the side a minute. What other debt have you got? The credit cards, which I didn't have. I didn't allow them to. I didn't take the amount that they said that I could charge. I took $1,000.

How much do you owe on the credit cards total that have your name on it? Oh, I think $2,000. Oh, not a lot. Are you behind on those? Have you paid those? No, I just started looking into everything. Do they have your name name only on them okay so that's about 17 000 between those two numbers what other debt do you have

i have medical expenses and stuff um and then i have some stuff in collections and like what? Let me see. Oh, I've got, well, there's actually some bad checks that are in there. How much are they? They're totaling about probably $300, and then I have, I had two bank, we had joint bank accounts, and I had three bank accounts. I closed the one. Okay, have you got all of the accounts that he has access to closed? The other two got closed.

Have you got all of the accounts that he has access to closed? Yes. Okay, including the credit cards, right? I think that's when they went to collections, they're closed. Okay, so he's not going to be able to run up any more problems for you, correct? Correct. Okay, good. So we've stopped the bleeding, and most of this debt is old, bad debt in one way or another. That's bad news, but it's also good news.

Because you're not paying payments on hardly any of this right now, correct? Correct. Do you have anything you're paying payments on today? No. Okay, good, good. All right. So you've gotten an extra job. You're on every dollar.

We're going to do a written budget. And here's what you're going to do. You're going to buy your food, which is eating at home. We're not going out to eat unless you get free food at your restaurant where you work, okay? But other than that, you don't go out to eat. Food, shelter, clothing, transportation, and utilities. Basics of life is all you can do. And everything else we're going to use to clean up this mess.

Because the more money we throw at this mess, the faster the mess goes away, and we want this mess to go away. Would you agree with that? Yes. Good. Okay. So that's what you're going to do. And the great news is you're not afraid of work.

And the great news is you are a person who makes mistakes like we all do, but you have learned your lesson on a bunch of these, haven't you? Yes. You are a lot wiser than you were two years ago and wisdom sometimes comes from pain kiddo and it did the same thing for me so i get it uh hopefully you won't lose your hair like i did but it stresses does that i'll tell you so uh stupid stuff we've all done it and uh you got a list of it and you got to pay some stupid tax i paid plenty in my life and you're going to be okay i'm going to walk with

you so what i want you to do now once you're doing this the first thing i want you to do is i want you to save a thousand dollars and just in cash in the underwear drawer is fine nobody knows it's there but you it's just a little baby rainy day fund in case something breaks on your car or something like that okay okay baby step one is a starter rainy day fund baby step two is then we're going to list all this mess you've got all these debts and you're not paying payments on any of them and we're going to clean up the little one and then the next little one in the next little one the good news is that you're going to get your checking account opened back up because you're going to get rid of these bad checks first because they're all small. Right? Okay.

They're little. I mean, your tips from one month is going to clean up all of that. Your tips from one week is going to clean up all of that, probably. Right? Yeah. And you're going to have no bad checks hanging over you. And then you're going to have no old medical bills hanging over you. And then you're going to have no old medical bills hanging over you. And then you're going to have no other little collection hanging over you.

See, like $5,000 completely rocks your world of people that are bothering you. It gets rid of all of them. It gets it down to two or three things. Right? Okay, yep. Because a whole bunch of your stuff is mosquito-sized. It is not full-size pterodactyl dinosaur-size, right? Correct.

The mosquitoes will drive you crazy, but they don't kill you. They make you think you're going to die, but they just drive you crazy. And that's what these bad checks and all these little $50, $80, $200, $500 crap is driving you nuts. Good news is it's making you do something about it. Okay? Once you work through those, then you go back and you'll be able to settle this repo. You'll be able to settle it for about $0.25 on the dollar, $0.20 on the dollar. And so $3,000 or $4,000 is going to make that repo go away. So you don't have $25,000 in debt.

You've got less than $10,000 by the time you settle on that repo. So hold on. I'm going to send you through Financial Peace University. I want to participate in your healing. You call me if you need more help. I will walk with you. I'm right there with you, kiddo. I got you.

You can do this. Hey, guys. This is James Childs, producer of The Dave Ramsey Show. I'm excited to announce that we're now carried on 600 radio stations across the country. To find one near you, head to DaveRamsey.com slash show.