The Ramsey Show - App - Finish that Degree with Cash, then Attack the Debt! (Hour 1)

Episode Date: May 29, 2019

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🎵 Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. That's 888-825-5225. Randy's going to start us off in Charlotte, North Carolina this hour. Hey, Randy, welcome to the Dave Ramsey Show. Thank you for having me, sir.

Sure. What's up? My question is, I'm a small business owner, and I've kind of ran into a problem, and I need to know if I should file for bankruptcy or use a company like Corporate Turnaround to try to salvage the company. Okay. What's wrong? I've just gotten into a situation where I'm having to take out MCAs, which are just killing my cash flow. You know, they're daily payments that I'm paying back,

and they're high-interest loans. Okay. So what happened to your revenue? The revenue is still there. I mean, the revenue is still coming in. It's just a matter of, you know, I think I grew too fast. I went from six employees to 18 employees, and I just don't think, you know,

I didn't have an investor to kind of put any capital into the business. I think that was just kind of a... I don't think it's the investor's fault. I think it's yours. Right. No, I agree. Yeah. So lay off half of your employees.

Okay. It'll suddenly cash flow, won't it? It would help cash flow, yes, sir. Yeah, because your number one expense in your P&L is going to be your payroll, right? Correct. And the truth is they're all gone anyway if you file bankruptcy, and they're all gone anyway if you bring in a turnaround company. And turnaround companies don't mess with 18-person companies,

and if they do, they're ripping you off with fees. So, no, this is something you've got to turn around. You're the man on this. You're the secret sauce. You're the one who grew it to this. What's your top line? Top line, you mean as far as what I've made last year? What's your gross revenues in the business annually?

Last year was $1.3 million. How long have you had it? Since 2007. Okay, cool. How long has it been struggling? I'd say the last two to three years. When did you do the hiring spree? Two years ago.

Okay. Now there's a correlation in it. Yes, sir. So you needed the help because the business was there, and you thought these bodies were going to ROI, and they haven't. And I went through the exact same thing. I didn't get as far down the hole as you have, but we actually have metrics to watch our hiring around here,

and we do not hire faster than we are roiing on the existing hires we have to everybody that works here has to make more than they cost or we don't get to stay here right right and that's that's basic business stuff so um you know that that's and it's a challenge man it's a challenge because you everybody you put in place doesn't save you revenue, and all of them don't make you revenue equal to what they cost. But overall, they have to free up people if they're a support team to do that. So, yeah, but you're in crisis mode. If you're doing NCAAs, man, that's payday lenders.

I mean, you're getting hammered. Yes, sir. Yes, sir, most definitely. Yeah, you're running desperate to desperate to desperate to desperate, and it's really getting not fun. Are you married? Separated. Mm-hmm.

Okay. How old are you, 32? 37. Okay, that's about right all right um when i went through losing everything and i don't think you're going to lose everything i think you caught it in time you're just going to have to make some really painful decisions or they're going to be made for you um one of the things that happened to me was um it i got a tattoo on my spirit i don't have a tattoo but i have a tattoo on my spirit a wood burning set engraved on my spirit god first first, Sharon second, kids third, business fourth. And when you get, with your back against the wall, with bankers pointing their gun at your face, you get that out of whack, and that's why I ask about your marriage.

Because there's a high correlation between entrepreneurs going through hell and their marriage going through hell and their marriage going through hell so um if there's anything you can do to work on your marriage aggressively while cutting your expenses aggressively and you really do have to cut your payroll in half even if it means you just call some customers up and go we're not going to be able to take care of you. I thought we were. I wanted to.

I'm really disappointed. I know you're disappointed. I know you're going to be angry. I just can't do this job. Whatever it is you do. I mean, you notice I haven't asked what you do, but you may not be able to fulfill some of your promises is my point, but you're not going to be able to anyway if you close. So you need to do some heavy pruning to the tree so the tree lives

and that's what you're looking at here um and um and you're by yourself aren't you there's not anybody you don't have anybody to talk to do you uh i really not opened up to anyone about it until you know the last couple. It's gotten really stressful. Yeah. Well, you're about 18 months behind on getting some good advice because somebody could have led you. That's been down the road before. I'm not any smarter than you. I'm just older and have more scars.

And so that's why I recognize some of these things so easily in this conversation is because I did the same stupid butt stuff, and so that's how I can see it. And it's normal. What you did was just a normal thing. You didn't do anything evil or bad, and you didn't have any malice in your heart. You weren't trying to screw something up. You were just trying to grow a business, and so you're a good guy. But you're going to go through some more pain at the business and you're going to fight like a wild man to keep your marriage don't let this business failure if

it fails or this business struggle if it's straight it's struggle it's going to struggle um take your marriage because here's what happens when the money gets tight she gets scared and when the thing where you draw your identity is falling apart you don't feel good about yourself and when she's scared she makes you not feel good about yourself and so you don't want to be around her right i remember sharon almost killed each other and her fear feeding off my self-consciousness of not providing and the business not winning and my identity being in the business uh too much uh fed off of each other and it was a really nasty crazy cycle so here's what we're going to do i'm going to put you in all

access which is three thousand dollars a year but i'm going to pay for it. That's our online coaching program for business leaders. And I'm going to get you with one of our business coaches right now. And one of them is going to hold you by the hand and walk with you through this. You're not doing anything anybody else hadn't done before you, but you're going to have to make some really difficult calls. And I think you can keep this thing. I think it it can survive i think you still got some gas in your tank emotionally and i know the business does you get a million dollars coming in man we can fix this um but you're gonna have to cut your expenses and you're gonna have to be embarrassed some places it's gonna hurt but you're gonna survive we'll walk with you brother hold on madison's

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That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Lynn is with us in Philadelphia. Hi, Lynn. Welcome to the Dave Ramsey Show. Hi, Dave. Thanks for having me.

Sure. What's up? Okay. So I wish I had discovered you years ago. I had about, in January, about $24,000 in personal debt, and in my junior year of college, getting a social services degree. I received a settlement of $15,000 for an injury and literally the day before I had discovered you and was like, I'm going all in on this. I put $1,000 in the savings, $14,000 immediately onto the debt. So I've got my personal debt down to about $7,000, but I have the $32,000 in school debt.

I still have three semesters left until I graduate. My question is, do I kind of put school on hold for a while until I pay everything off? Because I really am going to end up taking more debt on. What does school cost? What do I? It's about $19,000 a year. Okay, so you need $30,000 more to get you out.

Right. You said three semesters, right? Yes, sir. And I am getting scholarships and grants. I'm applying for things like crazy. So I did get it down to closer to like $12,000 out of pocket. Per year or total? Total.

Good. Well, go get a job. Well, so I am working. $12,000 is $1,000 a month. You can make $1,500 a month delivering pizza. Right. Well, that was my question. I actually just took on another job that is not part of my budget, so I could do that.

So I guess really my question was, should I take that money and apply it towards paying school? Yes. Or just dump it on debt? No, finish school okay finish school and by the way let's it's not to beat on you or anything but if i had if i had talked to you before you did it i would not have used the money to pay down your student loans while you were in school i would have just put them on hold and i would use that money to finish school well so i actually i put it on my personal debt. Honey, it's all personal debt.

Yeah, okay, yeah. Student loans are personal debt. They're all consumer debt of one kind or another. So the point is, though, your most valuable way out of this thing called money making is to make more, and the best way to do that typically is to finish your four-year degree you know and your return on investment on twelve thousand dollars and working your butt off to where you have no social life at all all you do is work and go to school for the next three semesters whoopty doopty do it right you got it you can do this okay all right yeah

you're on track i'm glad I'm glad we caught you. You're going to make it. And then when you get out of school, address whatever debts you have left at that point, whether they're student loans or other debts that you put under the heading of personal debt. Same kind of a thing. Coming up at the bottom of the hour, Rachel Cruz, Ramsey Personality, author of two number one bestselling books and the new best-selling contentment journal will be with me for a couple of segments answering your questions if you've got a question for

rachel you can call in right now the phone number is 888-825-5225 that's 888-825-5225 madison's going to hold calls for hold lines open for rachel calls right now all right jillian is with us in rochester new york hi jillian how are you hi dave good thanks thank you for taking my call sure what's up i had a question um my husband has been a teacher for 15 years and would like to quit his job okay um he's been and then he's in it for 15 years he can retire at 30 years um and he would bring home from the pension 45% of the average of his last three years. Yeah, but he's going to hate the next 15 years of his life. Who would do that? Right. So my question is,

well, I mean, you just ultimately answered it. Should we stick it out? No, not if it's 15 months. Yeah, but not 15 years. No, we don't worship at the altar of a bad pension plan. So what does he make? Roughly $52,000. $52,000. Okay. What's he teach?

Special education. Okay. What does he want to do? He would love to own his own business. Mm-hmm. Okay. Start one on the side. Well, he doesn't really have the time because we're trying to get out of debt, so we're each working multiple part-time jobs right now. If his side business makes more than his part-time job, he's accomplishing two things at once well he wants i mean it would be to do a food

truck or um open a bar or restaurant maybe not maybe he starts with a catering which doesn't have the overhead of either one or the upfront cost of either one lots of the best food truck people and lots of the best restaurants started as a caterer out of their own kitchen. And there's no overhead and no startup cost. So he loves to cook. He does love to cook, yes. What's he like to cook? A lot of fried things, like chicken wings, french fries.

You're not supposed to do that in New York. That's a southern thing. She's from Florida. We fry everything down here, honey. Yeah. Oh, my gosh. That's great. I love it.

No, hey, even if he just does a side gig here or there, he doesn't have to do this quickly. It could take three years to get business going he could make it his his other part-time job and do fried thing cooking at the flea market on two weekends a month you know it doesn't have to be a big thing let's just start with something just start messing around the business i do not recommend that you open a bar when you've never run a bar. The failure rate among small businesses is high. The failure rate among new restaurant owners is almost infinite. Very few people make it in their very first restaurant. He's never worked in one.

He's never chefed. He's never operated one. He doesn't know what the crap he's doing. That's really, and I'm going to go $250,000 in debt with an SBA loan on my house and go open a restaurant in the neighborhood. That's dumber than dirt. Okay? You don't want to do that.

You want to learn the craft from the inside out and have a five-year plan of getting your catering business cash flowing like a bandit and then move that into a food truck that you pay cash for with a proven process and recipes and proven customers. Okay. But if you go drop $40,000 or $50,000 or $100,000 on a food truck and you go borrow that money so he can, quote, live his passion, he's going to turn his dream into a nightmare

because he doesn't have proven recipes or customers or processes and he doesn't know how to operate a business yet he can learn all of those things and i suggest he go do it but it's probably a three to a five year track that he's on to make the conversion but quit my job and walk out and go 250 000 in debt and open a bar uh-uh okay so i'm with you on that part of it because your your security gland was going off wasn't it yes yeah you were like because you were talking like i work 15 more years get your pension thing well i'm going back because i thought we want to relocate to florida okay and i work from home full-time so i can work anywhere but he can move down there and he can move down there and uh and build his business down there and teach down there in the meantime.

So I don't care. Five years from today, I don't want him to be a teacher anymore. I want him to make $100,000 a year operating three food trucks. But I want him to walk to get there and not dive off a diving board and hope there's water in the pool, which is what people do all the time that have these dreams. So just don't dream. Let's just take steps. Make it a goal. Turn your dream into a goal, and let's take the clear steps to getting there.

Ken Coleman writes about this in his number one bestselling book, The Proximity Principle. I'm going to send you a copy for your husband. But this is not a three-month ordeal here. This is a three to a five-year plan to go into the type of business he wants to go into. And you've got to merge that with your getting out of debt plan and your go to Florida plan. And those three things have to kind of be woven together to create this beautiful tapestry that we're going to call your life. And you can do it, but I don't want him to work. If he's done on teaching, let's move to the next thing.

There's nothing wrong with that. Hey, thanks for the call. Rachel Cruz up next answering your questions right here on The Dave Ramsey Show. We'll be right back. Number one best-selling author, Rachel Cruz, joins me for a couple segments answering your questions. Host of The Rachel Cruz Show show a vast success on youtube and now the podcast version out there uh rolling along as well lots of people listening lots of people viewing and a new version comes out about every two weeks right that's right every other monday not about but actually every mother monday just like that so so this week what did you guys talk about on the Rachel Cruz Show? About your personality type and how any personality type can win with money. Okay.

And you had Ian on? Yeah, Ian Cron, if you're unfamiliar with the Enneagram. It is basically nine types of people. You can kind of put yourself into a type of nine. And it's a fascinating tool, the Enneagram. So he's kind of put yourself into a type of nine and it's a fascinating tool the any agreement so he's kind of an expert on that so i brought him in to talk about the different types of people and how each personality probably gravitates towards certain habits when it comes to money some good some bad yeah well you got good parts and all of us have our strength greatest strength

is our greatest weakness often right and we have natural tendencies depending on our personality style. And Ian's best-selling book, he had a number one best-selling book on the Enneagram. Yes. And he's spoken to our team and a lot of our – Rachel's a bit obsessed with this stuff, to say the least. I love the Enneagram. It's just fascinating. It's crazy. But, you know, we have money personalities overall, right?

It's like we always say you naturally can be a spender or a saver, a nerd, a free spirit, all of that. But I find that people sometimes use it as an excuse to not handle money well. They're like, well, I just love spending money. I'm just a spender. That's how it is. Or I'm not great at details. I don't like math. So I can't, yeah, I can't do a budget and understanding people like

me and it's amazing too just overall not just with your money but self-awareness and being aware of your strengths and weaknesses overall helps you win not only financially but in your relationships and your parenting and your marriage and so just understanding you on a deeper level and how you function whether it's how you were you know know, nature versus nurture, all of those things together. It's just it is. It's interesting. And family of origin, all that. All of that.

That's right. Birth. It all impacts your decision making. Yes. And the thing you don't want to do is just fall victim to it and use it as an excuse. said regardless of what we're talking about whether you're spend or save or nerd free spirit nine or three or four or six or whatever you are right or a disc or uh we're on the myers-briggs yeah any personality wherever you are whatever you're doing on this you can't oh well that's just the way it is with an entj or whatever you know that kind of you can't do that that's that's not the purpose of any of those tools the purpose is to understand and go okay that's something i have to offset and i have to be conscious of um big time and you know we started

that years ago just teaching budgeting with financial peace university within the whole nerd free spirit thing and the spender saver thing because typically opposites attract in marriage if larry burkett used to say if two people just like get married one of these unnecessary great great joke you know and uh but it's true spenders need savers savers need spenders nerds need free spirits free spirits need nerds and neither is right or wrong exactly i feel like some get patted on the back yeah savers you're so responsible yeah but on to an extreme standpoint if you're such a saver you become you know closed you know you're you you grab money on so tightly that sometimes you're not a great giver right because of that so you know there's elements of all of this and so understanding to enjoy money that's

right yes for sure and some savers save so some savers are hold on so tightly they won't even invest they just put it in a fruit jar or put it in a 1% savings account. And all of these things are just natural things. Your mom, my wife Sharon, is a natural saver. It's easy for her to save. Giving and spending are not as easy for her except on certain categories. If she decides it's a big deal, then all of a sudden it's okay to spend or give on that category. But by and large, she's pretty tight-fisted naturally, and she has to think through

that. And I'm the opposite. I'm a natural spender, and I always used to joke that's why God makes me teach this every day. My name is Dave, and I like stuff, and you guys are all my accountability group out there. So just knowing who you are does change you know i i i thought they checked your uh your receipt at costco when you come out to make sure that you had spent your 200 like it was federal law check it off with the highlighter i thought you had to go in i thought you weren't allowed out unless you did they wouldn't let you out of the room you know and so that's a spender but that that had that's a spender right there you're the same way i am and winston's the saver at your house naturally. Yes, yes.

And so the different numbers on the Enneagram obviously would have that. So you're a three. They have natural bents. Yes. And so that equates to spending, I'm sure. Yes, the performer. And the downside of my number, yes, is the appearance side. And so the amount of debt that can be associated with someone that's so worried in an unhealthy way about what people think about them from their car to their clothes

to whatever that they can they can end up in some serious debt and you know using the enneagram like a seven is the enthusiast when it always has fun it's everything's always a party and one of my good friends is this and i watch her we'll go out to dinner with a group of girlfriends and she'll be like oh grab the check guys don't worry about it and i'm like you don't make that kind of money you don't need to pay for five people you know but she's just in the moment it's great but she needs to know that about herself to realize her tendencies those knee-jerk reactions and so again just understanding yourself which are the numbers are the tight-fisted the more of the savers or the nerd the one the perfectionist oh yeah yeah okay uh usually nine yes a A five would do it.

Yeah. Okay. A nine, a peacemaker. They want a lot of security within conflict and relationships and possibly with money. Interesting. That's good. That has to be a good show. You're an eight.

Yeah. I hope people know that the Enneagram is. If you don't know, you're probably like, what is this? What's happening? So you're a challenger to a T. So just Google Enneagram type 8 and that is Dave Ramsey's picture will come up

next to it. It's my bio on there. It's unbelievable. It's unbelievable. It's exactly. It's so you. It's so you. There's not one line

he writes that's not me. I know. It's ridiculous. But what he said, he said that he does find a lot of 8s that actually don't like debt because

they don't like someone controlling them. They don't like someone telling them what to do. That's me. I know. Isn't that crazy? Never again again well american express call my house unless it's a wrong number you know i mean so it's just fascinating and another part

which isn't necessarily enneagram but just behavior and understanding is is the the effort of change right some people like you would fall in this i would fall in this category where you can change overnight yeah like i i literally made a decision i was gonna run a half marathon before i was 30 and that day i printed off a plan i texted a friend christy wright who's a runner we started a workout plan i went and bought new running shoes like all literally within six hours i was like oh yeah i'm not a runner but i'm gonna run this half marathon and i'm in the middle of my training so as early as quickly as i started and then four days later in the middle of my training i was like this is the stupidest thing i've ever done

i quit i quit in the middle of one of my runs i was like this is so stupid i got in my car and drove home didn't run it because i didn't want to but i can change i mean on a dime like i can make decisions so quickly and so changing something like this your money behavior your money habits some people naturally are like oh yeah i've had it this is it this is the point we're done i'm changing tomorrow i'm cutting everything up up. We're getting out of debt. Where some people, personality-wise, it's a process. They have to really emotionally buy in. They have to do some research. They have to dip their toe in the water and kind of understand, okay, this is it. And they eventually change and they get on board, but it takes a longer process.

So if you're married to someone who's opposite of you to know these things. So again, how much our personality and how we're wired functions into how we handle money. And when you know how you're wired

and your personality, you can win with money faster because you know your strengths and you know your weaknesses. And you can get along with your spouse. Yes, your relationships. Which is absolutely.

Usually help. And you grow empathy for others. That's another part, right? That's the thing. You have to. That's a mature part. I read the eight and I was like oh that's that's my dad that's it i get it fight with a pen and that's it i'm like conflicts people keep listening to this it's true like

people get mad at you or they think you're mean on the radio but conflict for you it's a sign it's a it's a you portray conflict as connection and love. And you're like, no, if you're going to fight for something, that means you really believe in it. And it's great. And then two seconds later, you're good. Yeah, I'm fine. But a lot of personalities don't do that. Oh, I know.

I understand. I read their tweets. It's okay. Keep at it, though. You're doing good. Rachel Cruz Show on YouTube. Be sure and check it out. The Contentment Journal is selling zoom zoom

back with your calls for rachel right here on the dave ramsey show Thank you. Number one bestselling author, Rachel Cruz, author of the current bestseller, The Contentment Journal, which is 90 days to contentment. And that would be 30 days on gratitude and 30 days on humility. And then the last 30 on contentment. So getting to contentment, it's a it's a process. I've realized, yeah, it's's an intentional decision but it's such a issue with your heart and understanding where you are in life that it takes some progression now you're about you're about 60 days into leading people through this right yes we're in the middle

of humility right now the 30 days of humility yeah okay and it's so about halfway through leading a team through on instagram yes so if you want to join in the middle and finish up kind of in and out during this section um but we're doing it together. Perfect. It's been fun. Okay. Cheyenne is in Louisville, Kentucky. Hi, Cheyenne.

Welcome to the Dave Ramsey Show. Your question for Rachel. Yes. Hi. Well, thank you so much for taking my call. I'm really excited to be talking to you guys. So I am engaged to be married and we are both individually working the plan. We're both on baby step two and I think maybe I just need a little pep talk. I am having a hard time setting money aside for my wedding when I know it could be going toward paying off my debt.

Okay. What do you guys make a year? What do you make and what's he make? So I make $48,000, and his base is right around $55,000. And what are you talking about spending on the wedding? Between $6,000 and $8,000. And that is wedding and honeymoon that's everything everything including the whole weekend all of it and you've taken into account obviously like

reception food dress that ceremony reception that that's 100, including the honeymoon. And we have about $7,500 saved since we got engaged. And that's why I'm having such a hard time because I'm like, oh, my gosh, I could have my car paid off for that $7,500. That's going toward the wedding. Right. But I also plan on getting married once. And so I would like to have a small wedding. And so I'm having a hard time balancing those two things. How much debt do you guys have overall?

So combined, we have right at $100,000 between everything. And that's both of ours combined. Okay. Together. Yes. Well, through the process of getting out of debt, the same truth is valid no matter what's happening in your life. The deeper you sacrifice, obviously the faster you can get out of debt. But there's some life moments that pop up for people, right? Pregnancy is one.

We always talk about that. If you get pregnant, to pause and save up. A wedding would be one as well to say, okay, there's this big life event happening. And so to have these markers, not as an excuse to stop the debt snowball, or not to put money towards the debt, but there are things that are going to come up in life that are these big milestones. And so this is not like your third cousin's best friend's wedding that you're wanting to go spend $3,000 for a destination, you know, outing to Mexico or something like this is your wedding, you're doing this. And so the the amount of money you're talking about compared to what you're making and your debt and your plan i think you guys are good and i think

you need just to have that budget and say okay this is what we're planning on spending which you have you said that five five six thousand dollars and have that as your limit and you're like okay that's it and so that should give you a little bit of the justification to say i can spend this money freely this is for our wedding. This is what we're doing. And then anything above and beyond that will be going towards the debt. Because I would be worried if you called and said you didn't have a budget. You didn't really know what you're spending. And there wasn't a plan in place because that's when things can get out of control, especially in this world of wedding. I'm like, it's insane how fast you can spend money.

But you guys are super, super intentional. You have your limits. And so I'd say enjoy it. It's okay. You guys are going to get out of debt fast. I can tell, you know, even by the way you're talking and you guys are already on the same page. You're working the same plan. You have so much going for you in this. And it's such a small percentage for you guys in your world right now.

How old are you? I am 27 and my fiance is 25. When are you getting married? In January. Awesome. Listen, listen, listen, listen, listen, listen. You are not overspending on your wedding. You're being very conservative and very reasonable.

Set that money aside and turn off the tapes in your head that you're doing something wrong. You're fine. you're fine okay you're fine if you called and said you were spending thirty thousand on the wedding rachel would have been rolling her eyes and i'd have been yelling at you but you're not okay and you're making you make a hundred between the two of you you got a hundred in debt between the two of you you're going to get married you're going to be debt free in two years okay that's where you're going to be and you're going to have a $6,000 wedding, which is very reasonable with the numbers that you have. Okay.

And ratios are what we look at, and Rachel's exactly right. Just turn it off. Set that money aside. This conversation's over. Now, on with the debt. You've got that $7,500. $1,000 of it is your baby step one. Boom.

And he's got his baby step one. Boom. And you've got six thousand set aside over and put in a separate account just where you're not even looking at it anymore it's just not to be used it's over the decision is made it's done you're not going to spend more than that you're not going to spend less than that it's done no more guilt you did a reasonable good common sense thing you're being being very, very smart. So let her go. She probably needed Uncle Dave just to tell her that. Just to say, you're okay.

You told her. You're okay. You're good. Emily's in Green Bay, Wisconsin. Hi, Emily. How are you? I'm good. How are you?

Better than I deserve. What's up? Okay. So I just recently kind of started listening to you. I actually have been binge listening to the podcast on my way to work every day. So I have started my budget. It's probably going to suck the first couple months, and I know that, but I'm trying to get that, you know, squared away.

And my question is, my boyfriend and I live together. We don't combine our expenses, our separate expenses, but obviously since we live together we have combine our expenses, our separate expenses, but obviously since we live together, we have combined housing expenses. And I'm just wondering, like, where that line starts and ends where we should be separating things. You have a roommate. Right, exactly. And that's how you run your budget. Okay.

Everybody pitches in their part on the rent. Everybody pitches in their part on the rent. Everybody pitches in their part on the utilities when you're roommates. But you do not combine checking accounts. You're not married. Right. And he owns the house, and so he has already been living here. He can afford the bills on his own, so I'm kind of just like, I'm here, I'm helping. But I have my debts that I'm really trying to get paid off, and I'm also going to school.

If your agreement is that your roommate is allowing you to live there free, then that's your agreement. Okay. And, you know, but don't, listen, you can't be sort of married. Right. You're not. You're shacking up. Right. That's it. I mean, you've got to sort of married. You're not. You're shacking up. Right. That's it.

I mean, you've got to decide what you're doing here. You have a roommate, and that's all it is. Rachel, you see anything different? Well, no. I was going to say, because what ends up getting super complicated is if you guys are dependent upon each other financially, that's when things start to get messy in the financial world. Because if a breakup happens, whatever it is, things pull apart and he can't afford the house without you, he's going to have to get another roommate. I mean, it's just, I wouldn't want, I don't want his house payment dependent upon you being there. If you guys look

and say, okay, we're going to split the mortgage. I'm paying this half, this half. And because that's what a roommate would do. That's what you have to do is to keep it separate because again, we've just heard story after story after story of people breaking up, splitting up. I actually just talked to a girl last week that this exact same thing happened and they had both names on the mortgage.

And they were selling it. I know. So it's just like keep it separate if this is the situation. But obviously the topic changes if marriage comes into play and you guys get married then it's a whole other ball game the way you do it and the way you look at it emotionally relationally everything changes and so um you know and truthfully what you're doing statistically doesn't play out you don't you're messing up

your chances of this thing working out. So the stats of people living together and ending up in a quality relationship long term are very, very low. It's the great lie of our culture today. Just when you read the data points on actually what happens in these situations, people leave scarred and damaged and financially damaged. And so just be very, very careful. I'm not a fan. I'm not a fan at all. I wouldn't want Rachel doing that. I wouldn't want

Denise doing that. I wouldn't want Daniel doing that. So, but that's what you're doing and you just have to, the only possible way to survive it is to treat it that way. So, hey, thanks for calling in. Rachel Cruz, thanks for dropping by. Yeah, thanks for having me on. I appreciate it. Good stuff this hour. This is The Dave it that way. So, hey, thanks for calling in. Rachel Cruz, thanks for dropping by. Yeah, thanks for having me on. I appreciate it.

Good stuff this hour. This is The Dave Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. If you would like to do your debt-free screen live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.