The Ramsey Show - App - From Maxed Out on Stupidity to Debt-Free (Hour 3)

Episode Date: March 18, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Thanks for being with us, America. We're glad you're here. Open phones at 888-825-5225. That's 888-825-5225. That's 888-825-5225. Kim's going to start us off this hour in Iowa City. Hi, Kim. How are you?

Oh, I had better weeks. Okay. What happened? Well, I had a high of completing my first half marathon on Sunday and got back from vacation. And after 30 years was notified that effective immediately, that was my last day in the office. Wow. What prompted the suddenness of this? It was positioned to say that we weren't where they wanted to be financially and in order to be,

you know, a business decision to do better, that they were reorganizing and trying to become more lean, I guess, and strategically placed. So you had no idea this was coming? We had gotten a memo, oh, six weeks, eight weeks ago saying that things weren't quite on projectory for finances and that they would be looking at things, but there was nothing coming. What did you do? I was a business project analyst, kind of a cross between project management and data analysis. Gotcha. And I was there for 30 years.

Yeah, I got that. What did you make? Just under $57,000. Oh, I'm glad you got laid off. This is awesome. Because you're probably worth a lot more than they were paying you. A top-notch project manager with data analyst ability is worth more than fifty seven thousand dollars in the marketplace i have several on my team that make more

than that it was the insurance the benefits that was the real kicker there for a long time it was 30 years at the same place and you were stuck insurance and benefits are crap if you could make ninety thousand dollars a year you wouldn't care about insurance and benefits no i wouldn't care about insurance and benefits. No, I wouldn't. You are stuck, and your feelings are hurt. And I don't blame you for having your feelings hurt.

30 years of anything and stop doing it requires some grieving. Right? It's just scary for the insurance for my kids. You're going to be okay. You have a very, very marketable career. You have a very marketable career. But you had just got, you had gotten really,

really, really, really, really comfortable. Yeah. And you just got your teeth kicked in. No formal training. It's all been on the job training

that I've taught myself. I don't have PMP or any of that stuff. How old are you? How old are you? How old are you? Oh, I'm 48. And how long have you been in the PM type role? About five years or so.

You're very marketable. You're very marketable. The only thing that's not marketable about you is how hurt your feelings are it really is i'm serious you probably i think this is god telling you you're worth more you would never have gone looking for a job even if your income would have doubled because you'd whined about insurance i loved what i did the people i worked for my boss was amazing not really just laid you off. She didn't even know. She didn't have any say.

No. She didn't even know. This is not a company you want to work for. I mean, they give you no notice. The boss doesn't know anything's going on. Leadership here is weak. I'll guarantee you nobody in my organization leaves the organization without their boss having known it way in advance and them having known it way in advance.

No. Completely blindsided. There was over 100 of us that were just herded into a room like cattle and said, effective immediately. I don't want to work there. I don't want to work there. The way people are valued, you're treated like cattle. You're just a commodity. I'm so glad you're gone.

I'm so glad for you. If you will look at this as a glass half full instead of a glass three quarter empty, you have the ability to walk into the marketplace and cause your income to go up, but you're going to have to go out there smiling and going, blessings are on the way, because they are if you look for them.

I'm serious. I really think you were underpaid. You need to hear that. And I got PMs working for me, bunches of them. So, I mean, if you're entry level and you don't know boo and you're 20 seconds out of college, yeah, you weren't overpaid. But you're 48 years old. You have business acumen and experience. You're articulate.

You're 48 years old. You have business acumen and experience. You're articulate. You're intelligent. And if you'll quit whining about insurance and going into panic mode, you are very marketable. Well, that's why I want some level-headed guidance here, because I know I am too emotional to this. Yeah. Well, I don't blame you. I'm not making fun of you. You have a right to have your feelings hurt, but I've got to tell you, in the middle of your feelings being hurt and just the grieving of the friendships and the length of time there, and it does hurt. That's legitimate. But in the middle of that, don't let that define you and turn you into paralysis mode where you say, gosh, I'm not worth anything.

You are worth more than $57,000 a year. You are. Okay. You are. Okay. You are. I mean, I actually know what I'm talking about here. I trust your opinion. Yeah. And so, you know, I want you to reset that.

And so what if, let me just add, what if God looked over and he said, Kim is never going to leave, so I'm kicking her out of the nest because I got something better for her i have a plan for you which is to give you hope and not bring you harm you ever heard that i'm trying to remember it's a new door opening and i can't understand his reasoning and his path but i just gotta accept it as best i can and let me ask you something let me ask you something well you have children. So what if you look down at one of your kids and you said,

you know, you're just in a comfort zone here and as your mom, I actually know that you can do this thing over here so I'm going to make you really uncomfortable so you'll go do this thing over here that's a whole lot better for you. Even if they don't understand. As every parent has done that, right?

I'm trying to do that with my daughter. You teach them to ride a bike, right? Yep. That's a thing. It's highly uncomfortable. It's outside the comfort zone. But you know they can do it. They just don't know they can do it.

And if we, being evil, know how to give our kids good gifts how much more so our father in heaven you're okay you're okay you're gonna be fine this is gonna turn out good and you're gonna call me back and tell me i was right well i had hoped my first phone call would be a debt debt free scream but it'll be your second one so okay we're still open for business it's okay you can call back later. Okay. You've got to call me back and tell me how this turns out, though. I've got to hear the rest of the story, because I know where it's going, if you have your chin up and not your lip out. All right?

You single? You single? Yes. I'm a single parent. Are you in a good church? I'm still trying to find one. Okay. Call one of your buddies that's in a good church and ask them who their pastor is and go sit down and talk to that pastor.

They're going to tell you the exact same thing I just did. You're going to be okay. I know you're scared. I know you're scared. But you have marketable skills. You didn't call me up and, you know, your only skill was, you know, PhD in German polka history. You're okay. You're going to be all right. Let me know how this turns out.

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Just text the word DENTAL to 77948 and get an exclusive Ramsey discount. That's DENTAL, D-E-N-T-A-L, to 77948. Joyce is with us in Greensboro, North Carolina. Welcome to the Dave Ramsey Show, Joyce. Hi, how are you? Better than I deserve. How can I help? Quick question. I'm looking for the best way to stay for grandchildren's college funds.

Is there a good alternative to the 529 where you don't have the restrictions? What kind of restrictions are you trying to avoid? Like if the kids decide not to go to school. Okay. All right. Well, yeah. I guess the 529 versus whether to just get stocks and that sort of thing. Right.

You could just buy mutual funds. There's a couple of different ways to do that. You know, as a grandparent, you don't have quite the influence that you do as a parent. So with our kids, we would recommend if it was your children to do the 529 or the ESA, the Educational Savings Account, which has to be used for college, but then pretty much brainwash them that we have a college fund and you're going to college. We have a college fund, you're going to college. We have a college fund, you're going to college. But as a grandparent, you don't have that option. So you think there's a probability that the parents aren't going to brainwash them into

going to college? Well, the parents have looked at the 529-2, and they're thinking about the restrictions. I think they will, but I think just looking into the future, if something happened and they did not, I was just trying to think of the best the future, if something happened and they did not, I was just trying to think of the best way to provide money for them and to help the parents provide money for them. Well, the best way is a 529 because it keeps the government's hands off of the growth. It's tax-free growth. And so if the probability is 50% that they're not going to go to college, I wouldn't use a 529.

If the probability is 5% that they're not going to go to college i wouldn't use a 529 if the probability is five percent that they're not going to go to college i would use a 529 okay and so there's always a chance some kids not going to go to school and then you can transfer the money to a sibling you can do a lot of different things with it you can actually now pay for uh private school for k through 12 with them now okay as of the new tax law being passed, this last tax law changed that. So there's a few things like that that you can do. But, you know, again, it's a probability thing in your minds as if it's just like, oh, I don't know if I want to do that.

Well, you're not, money's not trapped. The government doesn't take the money. It just penalizes you on the growth is all if they don't go. So, again, if it's a 5% probability that they might not go, and if they were to get scholarships, by the way, academic and academic or athletic scholarships or something, you can pull that much, the equivalent amount, out of the 529 without any taxes on it. Oh, okay.

So if they get a $5,000 scholarship, you can pull $5,000 out of the 529. There's no taxes on it. Oh, great. And, Kent, may $5,000 scholarship, you can pull $5,000 out of the 529. There's no taxes on it. Oh, great. And may I ask you one more quick question? Sure. Is there a rule of thumb for the percentage that you would withdraw from your retirement as not to deplete your money over time? I know it's a guessing thing.

But it's... No more... If you've got it invested in good growth stock mutual funds, and I do, and if it were returning like mine have been returning north of 12%, if you pull less than 12% out and it's growing at more than 12%, you're never going to get into the principal. And so we tell folks, you know, don't pull out more than 6% or 8% if you're earning 12%. Now, if you're earning 6% and you pull out 6%, you're eventually probably going to get in the hole there. But pull out less than you're earning on average on the investments, considerably less.

And that way you never really touch the goose. All you're dealing with is the golden eggs. The income is the golden eggs. The goose is the principal. And that's what you're dealing with is the golden eggs. The income is the golden eggs. The goose is the principal, and that's what you're facing. Myrna is with us in Atlanta. Hi, Myrna. How are you? Hi, Dave.

It's so good to talk to you. You too. What's up? So my husband and I have been following your program since 2015, and we are currently at Baby Step 4. We are pregnant, and we are currently living in a basement. It doesn't sound as bad as it sometimes sounds, but it's a basement apartment, and to save money so that we can eventually buy a house.

And our eventual goal was to be able to buy this house that we actually were staying in because we'd fallen in love with it and to buy that house, you know, two or three years or whenever the owner decides to sell it because they're currently 92 and looking to move on. And so, my question is, they actually let us know recently that they're interested in selling it and wanted to know if we were interested, which we're just not sure if now is the best time for us to buy, but we love this house. So you're out of debt and you have your emergency fund in place? Yes. And you're putting money into retirement. Have you saved any money for a down payment? That's what we're working on now. And we just started that process.

How much have you got saved for your down payment? Right now we only are at like $3,000. Okay. And how much is this house? They don't have an official price yet. They need to do all the comping. Roughly. I'm thinking it's going to be between $250 and $300.

Okay. All right. And so will they give you a little time to scratch together your down payment? That I would have to find out. It sounds like they're trying to sell by the end of this year. Okay. And what is your household income? We make $6,000 a month.

Okay. So if you stop temporarily putting money into your retirement and you lean on Baby Step 3B, your down payment, how much could you have saved by the end of the year? Oh, that's a really good question. We'd probably be upwards of maybe 30 or 40. Yeah. Yeah, that's pretty cool. That put you in a really strong position, wasn't it?

Huh. I didn't think about stopping the retirement. Yeah, it's a temporary thing. Sometimes folks do baby step four while they're saving for a house. Sometimes they temporarily, uh uh for the first home purchase will stop their their baby step four and we call that baby step 3b then above your emergency funds saving your down payment and i think that's going to get you there i think you're in good shape yay if you want this house it sounds like if they'll give you to the end of the year to scratch

together your down payment you probably and be in pretty decent shape to buy it. Fifteen-year fixed rate, and the payment should not be more than a fourth of your take-home pay. Ruby's in Pittsburgh. Hi, Ruby. Welcome to the Dave Ramsey Show. Hi. Thanks, Dave.

Happy to be with you today. Happy to have you. How can I help? So I have a question. Going through a lot of life changes right now. Actually, my husband, my new husband and I are new to your program and got really excited about it. So we basically paid off our student loans. He didn't have very many and I've always been debt free. And so now, you know, we're married. We actually have a baby on the way. And yeah,

thank you. And we're looking at moving where my husband is. He's actually three hours away with his work. I'm looking at a house purchase. And so my question is actually related to company stock I have. I've been working in the tech industry, and part of my compensation has been company stock that's been investing over the last few years. And I didn't realize I've never touched it. And as of now, my best value is almost $150,000.

And so I'm just kind of wondering right now, you know, we have about 50,000 saved. When we got pregnant and we got on this program, we just started saving money because we knew we'd have a house in our future. And so we have about 50,000 in savings right now. Our joint income is $200,000. So we make a decent income together. And we're looking at purchasing a house for $350,000 in the next six months. And so I'm looking at this right now. If we wanted to move forward on a purchase, we'd like to move forward on it because the baby's on the way. Good point.

But we don't have quite enough saved right now with our $55,000. And so I'm wondering if I should take out some of this vested stock. All of it. And put it, all of it? Yeah. And just throw it at the mortgage. Yeah. That's $200,000 down on $350,000 and then pay the stupid house off in three years.

Well, so that's my question as well. This house, it's like a five-year house for us. Pay it off. Pay it off. Huh? Pay it off. When you sell a paid-off house, you know what they give you? A check.

Cash. You're not going to lose the money by paying it off. Money's not gone. And you don't know what's going to happen. So, right now, get the house. Get it paid off as quick as you can. You make good money. Don't wallow around in debt.

Make your move. Don't be three hours away from your husband when you're pregnant. I'm with you. Do it. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM,

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chministries.org In the lobby of Ramsey Solutions, Daniel and Melissa are with us. Hey, guys, how are you? How's it going? Good, how are you? Welcome, welcome. Good to have you. Where do you guys live? St. Louis, Missouri.

St. Louis. Welcome to Nashville. Thank you. And all the way down here to do a debt-free scream. Yes. Good for you. How much have you paid off? We have paid off $137,200.

All right. And how long did this take? Exactly three years. Cool. And your range of income during that time? We started off making about $66,000 a year, and our highest was $180,000. Whoa! But we're down back to $120,000 now.

What do you all do for a living? I'm a business analyst at a large health care insurance corporation. During that time, I was at the end when it went up. I was selling cars, but I left that as soon as we were finished, and I went into project management for an HVAC company. Okay, cool. So now we're back to $120,000. Yes.

Okay. All right, cool. So you did what you wanted to do once cool. So now we're back to 120. Yes. Okay. All right, cool. So you did what you wanted to do once you were debt-free, huh? Yeah. Yes. All right, good, good. Good for you. How old are you two? I'm 27.

25. Okay, so I'm guessing you got married about three years ago. Yes. Exactly, yes. Okay, and what's this debt breakdown, this $137,000? It is two car loans, two bachelor's degrees, and two master's degrees. Whoa. We like to do things in pairs.

There we go. Absolutely. Okay. So what are your master's in? Management. Yeah, business management. Management. So your MBAs?

MSN. Yes, MSM. Okay. All right. Perfect. And I'm guessing that's where you met then. Yes, college. Ah, okay.. Okay. All right. Perfect. And I'm guessing that's where you met then. Yes, college. Ah, okay.

All right. So you got married. You got a big pile of debt. You got cars and student loans coming out your ears. Yep. How much of the 137 was total student loans? About 100. Yeah, 100.

Almost exactly 100. Okay. All right. And 30-something thousand in car debt. Yeah. Yep. All right. And so what happened when you got married you said okay this something's got to change here yeah well right before we got married i had heard of you before and i'm like well i'm pretty good with my money but i was nowhere near dave ramsey good with money so i kind of looked you up and I did the home study by myself. And so that's when I kind of went to him and I'm like, so after the wedding, I think we should take a lot of our wedding money and throw it at our debt.

So that's kind of what I what I said. That was the little starting chunk, a couple grand to go toward it. OK. Yeah. Just to get the process started. Yeah. All right. Yeah. But both of you have business minds and analytical minds, obviously, with your master's level training and that stuff.

You wouldn't have got out of school if you didn't. Yes. So then you sat down at this and started looking at it. What was it that made you think, I need to do this now and I need to turn up the heat? Probably, I just, I knew we wanted to do so much in life and we are big travelers and we wanted to go on lots of vacations and his family lives in florida so i knew we were going to want to do a lot of traveling um so i really wanted to get out of debt so we could do those lots of fun things and i wanted to get out of debt so we could do those lots of fun things, and I wanted to get out of debt before we bought a house and had kids. That was my big goals.

Okay. So, Daniel, what did you say to all of this? Yes, ma'am? Yeah, pretty much I just kind of followed along. In the beginning, I wasn't as involved in the process, but when we were getting really close to the end, I started getting a little bit more excited about it because we could start doing fun things again.

So it was helpful, especially when it was getting tough in the last year, year and a half of it, to kind of see an end goal and see that we'd get back to being able to do fun things again. So how much of it did you pay in the last year of the three years? About half of it. Okay. Roughly. Maybe a little less. All right. So you were you were

making increasing progress but your income was increasing yes significantly yeah okay all right very cool congratulations how's it feel feels good it feels really good it's so weird to like see our budget every month and we have all that extra money to just do with whatever we need to well not only do you make good money but you're used to living on nothing. Yeah. There's a big gap right now. It's like, oh, wow. Exactly.

We still didn't really change our spending habits. Go to Florida for lunch. Yeah. We still haven't really changed much of our spending at all. So, I mean, we're kind of trying to get into a house now. So, we're still staying that portion of the process until we have enough to put down at home and all that. Yeah, very good. And get the emergency fund.

So other than the two of you, newly married couple, who were your cheerleaders? All of our family, probably. Yes, our family. We're definitely big cheerleaders. My mom is our biggest cheerleader, I think. She came with you? Yep, she did. All right.

We got her on the plan, plan too and she was able to get out of debt with us wow yeah that was fun yeah that's cool yeah very cool became a family affair yeah so what do you tell people the key to getting out of debt is you did it you've got the ability to look at this uh objectively what was it that Well, I think the biggest thing is getting on a budget. And I know that's so cliche, but I think the budget is the biggest thing because you're telling where your money, where to go. And I know a lot of people we talked about to get on a budget, they're like, well, I can't afford to get on a budget.

That just is not the kind of mindset. So, yeah, the budget was a big thing for us and then i think also what helped us a lot was just talking about our dreams together and what we wanted to do um after we got out of a debt and i think that really helped keep our fire going yeah you gotta have a good why yeah also i mean with the excuses thing i mean a lot of people can pretty easily fault to that. And if you can get past the, you know, always having something to blame your situation on and always looking to someone else to help, it kind of puts you in a little bit of a better situation

of getting out of your debt. Well, I get to meet rock star millennials every day doing this that are like you guys, that are incredible achievers high achievers but i also know that you have some friends who aren't rock stars they've got their lips stuck out and they're like 27 years old and i'm a victim of the student loan debacle and i can't do anything and you paid off 137 000 in three years while they were whining yeah yeah that's exactly true yeah and that's true of every generation. There's always a group of whiners and there's always a group of achievers.

Of course. So well done, you guys. So you can do this. You can do anything. Yeah, you'd hope so, right? That's what we feel like. You know how to lock arms. You know how to be unified in your approach to things.

Yeah. And you'll be able to face challenges and opportunities both. As a married couple, the spiritual aspects of this are incredible. Yeah. And I mean, what God is going to do with you guys is absolutely amazing. We're proud of you. Thank you. I know your mom is.

She came all the way down here with you. Yep. Where did mom travel from? St. Louis. St. Louis. St. Louis. Okay. All right.

Cool. Well, so good to have you guys. We've got a copy of Chris Hogan's book for you. Awesome. Every Day Millionaires. You're going to be one before you know it. We hope so. I can see the numbers.

I mean, you're making $120 doing what you love. Your income's going to go up. You're only, what, 27? Yeah, 25. 25! Oh, my gosh! I know. We're doing it.

Yeah, $120 is our base. I mean, that's what... It ain't going anywhere but there. So I'm looking at you easily before you're 35. You're millionaires. Easily. We hope so. Yeah.

Planning on it. As long as I don't buy a bunch of cars or stuff like that. I won't let them. Yeah, she already said that. That's right. Well, I'll tell you, you've now lived like no one else, and now you'll be able to live and give like no one else. You'll be able to have that outrageous generosity experience. Well, congratulations.

Very well done. Daniel and Melissa from from st louis listen to this 25 years old paid off 137 000 in three years making 66 to 180 to 120 count it down let's We're debt-free! This is how it's done! Wow! Absolutely amazing. Very well done. I just can't say enough. It seems like every debt-free scream these days is somebody in their 20s

i mean i don't mind you old people coming and doing your debt-free screams too y'all can come too it is harder to teach an old dog new tricks though i mean what a way to start your marriage to sit down and go game on baby game on, wow. I love it. I didn't start my marriage that way. I started my marriage going deeply in debt and filing bankruptcy. Then we had to crawl out of that mess. Oh, man, if I'd only been that smart. This is the Dave Ramsey Show. Thank you. Our scripture today, 1 Corinthians 3.9, For we are co-workers in God's service.

You are God's field, God's building. Queen Elizabeth II said, I know of no single formula for success, but over the years, I have observed that some attributes of leadership are universal and are often about finding ways of encouraging people to combine their efforts, their talents, their insights, their enthusiasm, and their inspiration. John is in Winston-Salem. Hey, John, how are you? Good, Dave. How are you doing?

Better than I deserve. What's happening in your world? Not much. I just got married to my wife in September and I never had any student loan debt when I graduated from college and she

graduated. She has quite a bit, about 150. Your phone is breaking up really bad. Do you have a loose cable or something? How am I sounding right now? Still the same. So your wife has a lot of student loan debt, and your question's what?

It's $150 combined split up into a private loan and a federal loan. Two of the private loans, I just wanted to run by you my process and how I'm thinking about paying the cost. What's your household income? We're about $180,000. Okay, that's good. So you're going to clean it up in a couple of years then, right? Yeah. Okay.

So I would just work the debt snowball regardless of the background or the private or the subsidized or whatever. It doesn't matter because you're going to be done so fast that none of the other extremities really matter. The ancillary issues don't matter. Just list the debts, smallest to largest, the individual loans. You probably have a bunch of different loans. There are probably 10 or more at least here. And I would just list them out, smallest to largest, regardless of private or subsidized,

and then just work them off in that order. Again, keep in mind, two years from today, you should be debt-free. So any of the other side issues or philosophical things you're looking at, they really just go away very quickly. It's not going to be an issue. Susanna? Susanna, maybe? Susanna. Okay, Susanna is with us in Phoenix. Hi, Susanna.anna maybe Susanna

Susanna is with us in Phoenix Hi Susanna how are you I'm doing well thank you how are you Better than I deserve what's up Hi thank you so much for taking my call So we are on baby step number 2 And I keep Like a spreadsheet of our cash flow

But my question is What do we consider cash flow? I mean, I have things as minimal as $25 copay for the doctor's visit. Is that something you would consider cash flow? Okay, I'm not sure the term cash flow, how you're using it, but basically a properly done household personal budget is just your income is at the top, your take-home pay, and then every dollar is giving an assignment.

How much of a fine-tooth comb you want to run through those categories is up to you. Most people start with a much more detailed budget and then lump it together, and it becomes bigger rocks later. The sharings of my budget is one page today. There's nothing to it. There's not a lot to do because most of our categories are together. But anything that you're going to spend money on has to be somewhere in there, whether it's lumped under a category or whether it's uh

it's got its own standalone category uh doesn't matter because but the point is every dollar has an assignment and you know we have the world's best budgeting app that's completely free called every dollar you can get it at every dollar.com or itunes or google play or whatever and you know put it on your phone put put it on your desktop. It's free to use. And all it's going to do is just tell you to do that. It's going to walk you through in about 10 minutes giving every dollar an assignment. But I'll give you an example as to lumping them together.

We have a food category at our house. When we started, we had groceries and restaurants. We had to separate them because we would go to the restaurant and eat up all the grocery store food, right? And so, you know, we had to do that. But nowadays, it's, you know, we got a lot more room in the budget today, of course. And we've been doing it for 30 years. And so we kind of got a rhythm on it, sharing those. And, you know, we're empty nesters.

So the grocery, you know, I don't need teenage boys at home eating and stuff like that so it's a different world right but you you know so but when you start it it's really helpful to really have it broken down you know very very carefully so you have a 25 copay every single month no not every month just whatever we decide to go to the doctors like um oh you know what i've got a doctor's appointment next week, $25, and I'm categorizing it. I have a spreadsheet called cash flow in 2019, and so I'm putting it there as opposed to the budget because we didn't budget for it ahead of time. So your cash flow sheet is separate from your budget? Yes and no.

It's what's left over after you took care of necessities? Right. So, for example, we get paid every other Friday. So on Friday when we get paid, we pay all the bills, right, any bills that are within that time frame. So light bill, whatever, food and all that good stuff. We do our budget on a two-week pay period because we get paid every other Friday. So when we get paid on that Friday, we already have our budget set for the entire month, right?

So we pay all these bills and all of a sudden my husband will say something like, oh, hey, next week on Wednesday I schedule the doctor's appointment. It's going to be $25 for that. So I throw it in my cash flow category. Okay, your cash flow category is what economists would call disposable income. It's extra income left over it's your slush fund after you've taken care of the necessities and planned items of life agreed exactly exactly all i'm telling you to do is combine these things and you just you you would have a uh i would break your cash flow

sheet up into a couple of handfuls of categories uh you know miscellaneous his and her uh blow category you got a little blow money for your pocket um and you probably sounds like you need medical in there you know and that kind of stuff so yeah just jump on every dollar and play with that it sounds like you're working awfully hard at this to me like you're doubling up the work um you ought to be able to do this in 10 20 minutes the first time and then it's going to take It sounds like you're working awfully hard at this to me. Like you're doubling up the work. You ought to be able to do this in 10, 20 minutes the first time, and then it's going to take you, you know, 30 minutes to an hour a week to manage it when you first start, and after that it'll take you 15 minutes a week to manage it.

And it's just not that big a deal. You just, again, all we're doing is saying we're going to tell the money what to do before it leaves that's the big thing when you do that instead of wondering you know a budget is people telling their money what to do instead of wondering where it went that's the big change and you're already doing that so you've got this dialed in and you are you know you're like me you're like a super nerd you're a detailed math person you love spreadsheets you're having way too much fun with this which is a little sick. And me too.

I'm the same way. That's how I can tell. I'm kidding with you. But you're going to do fine. I would simplify your life if I were you. I'd put the EveryDollar app on both your things and on both your phones and put it on your laptop and then keep up with it. Tell your husband, you know, by the way, if you book a doctor's's appointment usually it's more than a month out unless you're sick so a random you know eye check physical check up whatever those kinds of things sometimes you can book those inside of 30 days but most of the time you know in

advance so we just have to do a better job of communicating and planning together instead of you trying to come up with a system but you leave yourself a little slush money in their little room in your budget and give that a name that's blow money you've got a certain amount of blow money honey you've got a certain amount of blow money uh man husband and wife right and um then that gives you the wiggle room to do a few things out of pocket so to speak and then you've just got a general miscellaneous. But you'll have a car repair category, even though you don't know if you're going to have a car repair. You'll have a clothing category, even though we don't know that we necessarily will spend all that money this month on clothing. And those categories that don't spend out in a month, the balances carry forward.

And you build up a little bit of a car repair fund that way, a little bit of a clothing fund that way. And that will help you put all that together. So, excellent job. Hey, thanks for calling in. That puts this hour of the Dave Ramsey Show in the books. Our thanks to James Childs, our producer. Kelly Daniel, our associate producer and phone screener. I am Dave Ramsey, your host.

We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. 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.