The Ramsey Show - App - Fund an Invention Idea or Pay Off Debt? (Hour 2)

Episode Date: October 23, 2018

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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. Thanks for joining us, America. Open phones at 888-825-5225. That's 888-825-5225. Benjamin is with us in Wichita, Kansas. Hi, Benjamin. How are you? I'm doing well. Thank you for taking my call, Dave.

Sure. What's up? Well, I have a question for you. I'm now considered uninsurable, and my term life insurance will expire next year. In our FPU class, there are several of us that are considered uninsurable. So one of our questions is, what should we do instead of term life insurance? And in my case, I already have accidental death insurance in place. Should I go ahead and cancel it or keep it since I now can't get term insurance? How old are you? 43. Why are you not insurable? History of diabetes. I'm no longer diabetic, but I just got that diagnosis removed, but I've had that in the past five years of my history. Okay. Have you checked with Zander Insurance and see what they can write you? We're in the process of having them do a double check.

Okay. A dry app or something, yeah. Because every day that goes by, you're going to be more and more insurable in your situation. So that's great news. This hopefully is a short-lived issue, okay? Because, in other words, I think you're going to be able to get insurance. I just don't know exactly when or what it's going to cost. That's the other thing you've got to look at. It could be unreasonable, but diabetes is a real tough diagnosis for life insurance, really tough.

So anyway, the answer to your question overall is if someone's uninsurable, yes, you would keep accidental death. At 40-something years old, you know, the probability is accidental. It would be your cause, except that you've had the diabetes issue. But otherwise, I mean, statistically, that would be the cause. We don't recommend accidental death, as you know, but it's better than having no insurance. Right. So, yeah, I would keep it. And it's not that expensive because it's kind of gimmick insurance is what it is.

Definitely would keep any term or any whole life or anything that's in place as long as you can keep it. Don't, you know, to the very last moment. And if your term is expiring, have you checked to see if they have a renewal, a non-medical renewal? No, I have not. I didn't know about those. Sometimes they do. Sometimes it's very, very expensive. But, again, it might be worth it if you've got a non-medical renewal.

It may just jump way up, like triple or something, what you're paying now kind of thing. So would you have like a 10- or a 20-year term and it's run out? Right. We had a 20-year term when we first got married. Okay. All right. Yeah, you would see it go up just to buy a 20-year term at 40 rather than at 20, obviously. But in your case, if we did a non-medical renewal, most of them have that. So I would check that.

That's the other thing. Then lastly, or not lastly, the next thing I would do is just start looking around for gimmick-type non-medical policies, policies that don't check medical. And that's like $10,000 issued through your bank with your checking account, and you can buy it. Now, the price per thousand is really stupid high, okay? But if you had 10 of those and had $100,000 lined up because you got some gimmick stuff, it's better than having no insurance. Okay.

But, again, you're always measuring then back against that what it's costing you. Would I pay $1,000 a year for $10,000 worth of insurance? No. Right. No. But would I pay $100 for that policy in this situation? Maybe. And that's really high for a 40-year-old per 1,000.

You see what I'm saying? So, you know, it's just a matter of relative cost to the amount of coverage, and just does it give you sticker shock when you look at it? The last thing, of course, is if you remain uninsurable long-term, your goal would be the same as it would be for those who have insurance, and that is by getting out of debt and building wealth, your need for insurance goes away. Okay. Because if you have a million dollars in your 401k and you have no debt, house or anything,

and you die, your wife can probably make it. Okay. That's called self-insured, in other words. Okay. Would that increase maybe the amount of the emergency fund at all if I remain uninsurable? Probably, yeah. Yeah. You know, just because, again, she's going to be facing something,

and that would be part of your self-insured wealth-building picture that we're trying to go for long-term. And we go for that either way. I mean, the goal is raise the kids, get them out of the house, so they're not there to have to be fed, right? The goal is to get the house paid off and everything else paid off and then build a huge nest egg if you've done those three things you know somewhere in your 50s or 60s you become completely self-insured maybe sooner because your wife would be okay if you left her behind with a huge pile of money no debt the kids

are gone that makes sense and so we work towards that that's why we suggest term insurance instead of one of the reasons we suggest term insurance, because term insurance, as you were finding out, runs out. So a couple of three suggestions there. But I'll tell you this. I think within five years you're insurable. Okay. If you stay clear of the diabetes, if the diagnosis doesn't reoccur.

But Xander can tell you more. It used to be that if you had diabetes or cancer or heart you were just done no no no amount of time but the insurance market has gotten much more sophisticated in analyzing your actual situation case by case and those three things do not permanently mean no life insurance ever now again you had a cancer diagnosis two weeks ago you're not insurable you know but if've been clear cancer-free for five years and somebody told you you'd never get insurance, you may be able to get insurance and start to look at that. It'll be rated, but you won't get premium prices. But you check on that, folks.

You check on that. Now, call Xander and talk to him. They'll talk you through it. Susan is with us in – if I don't push the wrong button, Susan's with us. Susan, there she is, is with us in Raleigh, North Carolina. Hi, Susan. How are you? Hi there.

How are you doing? Better than I deserve. How can I help? My husband and I are both 58, and he plans to retire at age 62. I will probably retire earlier than that. We're in pretty good shape. We don't have any debt. We have 401ks and I have retirement as well. Good. How much is in the 401ks? Let's see. Mine is about 75 and he actually has about $40,000 in 401K,

but then we have a separate account with a financial advisor that's probably close to $600,000. Okay, and what's your house worth? About $200,000. And it's paid for? Yes. So you're probably millionaires. Way to go. Well, yeah, I think so, but I don't like to think about it.

It's okay. I just have a little bit of fear about a couple of things. Okay. Mainly, you know, when we retire, he won't have an insurance policy. And so we have bought long-term care insurance. We just started that last year. Good. And he does have the health savings account at his work.

So my question is twofold, actually. Should we start putting a significant amount of money in that? No, I wouldn't. I'd make sure you had your emergency fund in place and keep enough in there to cover your deductible. Other than that, I'd just do investing because you're not going to continue this when he quits work. You're going to have a different health plan at that point. 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 healthcare costs? Based on New Testament principles, Christian Healthcare Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major healthcare costs. Christian Healthcare Ministries is the original health cost-sharing ministry.

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chministries.org. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. Chelsea is in Los Angeles. Hi, Chelsea. How are you? I'm doing good. How are you doing?

Better than I deserve. What's up in your world? I had a question for you in regards to hourly pay versus salary. My husband is transitioning into a new position where they're going to be giving him a pay raise. But with that pay raise, they're saying that he also has, that they're going to be transitioning him into a salary pay. He usually works between 5 and 20 hours of overtime each week.

So I wanted to make sure that when he, they haven't given him a formal offer yet, but when they do, wanted to make sure that when he, they haven't given him a formal offer yet, but when they do, wanted to make sure that, how would you, how would you recommend to calculate whether the salary rate is comparable with, for example, the hours that he was working before and the pay that he would get with overtime? Well, it sounds like it would be simple. You've been working 15 to 20 hours a week last year, extra, and you've been paid for that in overtime, correct? Correct.

And so what was his income last year, including the overtime? It was about $48,000. And how will that compare to the salary? That's the part that we don't know yet. And so if the salary is 50, that's a raise. If the salary is 45 and the same number of hours are expected to be worked, it's effectively a pay cut. Right? Yes.

Does that make sense? Yeah, because I was kind of weary because it was just more since we're in baby number two. I know that he has the potential to work more hours so because of that i was kind of yeah but but the question too the question is not just more hours the question is is this a good deal for him apples to apples not uh and if and has he got the chance to move up in the company because he moves to salary? Yes, he's going to be moving to a management position. No, but I mean further up later. Oh.

Okay, but let's say they offer him 55 as a salary or 60 as a salary. Well, we'd be dancing, wouldn't we? Yes. Okay. Because that's like getting paid a lot more and working the same number of hours. It's almost like he picked up more hours but didn't have to work them. You see what I'm saying? But again, if they want to give him a salary and act like they did him a favor and he gets paid $40, but he's working the same number of hours where he's working when he's making $48,

then that's not a blessing. Yes. Is this making sense to you? Yeah, that makes sense. If it's even, if it's 48 to 48, we still like the salary because of the upward potential. Okay. Long term. It's a long term good career move. He's moving into leadership, into management, and that's where he wants to head towards long term but um the you know yes but but again you just compare it to last year's income so the whole thing comes down to how does it compare to 48 000 what's the salary do because that's what

he was making working the hours that he's going to continue to be working, apparently. Chris is with us in Tulsa, Oklahoma. Hi, Chris. How are you? I'm doing good, Dave. Thanks for taking my call. Sure. What's up? Well, right now, I make income about $31,000 a year.

I've got $1,400 in credit card debt, about $11,000 of student loan debt. That's it. That debt about six months ago was right about $11,000 of student loan debt. That's it. That debt about six months ago was right about $19,000. I've been working hard, you know, saving my money and paying that off as much as I can. Good. But I'm at a crutch right now. I came up with the idea for an invention, and I don't know whether to keep, you know, steamrolling my debt plan and doing all that

or just kind of jump ship and say, hey, this is something that could be my future potentially. So I kind of want maybe your financial advice and what to do with the remaining debt I have and my aspirations because I'm in the process. I've been saving to get a VA home loan, and I was just about there. So any advice you can give me, I'd be greatly appreciated. Well, I'm going to avoid buying the home until I get the debt cleared. The only question is then how can we start working on the invention idea and make some money now?

Because we don't need to make a bunch of money five years from now we need some money today like about twenty thousand dollars today so the invention you came up with is a physical product yes sir it's a uh odor deodorizer slash uh mold uh it's a little small machine that that people can install in their homes. Okay, and you've made one? I've just made a very rudimentary prototype. The next phase I've got is like either dip into my rainy day fund or start coming into my regular cash flow and like buying a computer

and get my 3D modeling and get me, you know, a couple of silicone prototypes so I can go, you know, take it to the next level of what I want to do. So, again, do I jump off my debt plan or do I, you know, chase my invention? Okay. Well, what you're talking about, you could spend anywhere from $25 to $250,000 on it. There's really no in-between. I mean, you could just go anywhere you want to go with this. There's a lot of money to be spent on something like this.

And if you were a billionaire and what you would do is you would build a couple of them and you'd get them out there and test them and make sure that they worked and that there was a market for it before you went into production. Because you don't go into production on prototypes that are untested from an R&D standpoint, or you don't go into production on something that I've got no market for, I've not been able to sell it. Because you can make 100,000 of them and have them in your basement if you had unlimited

funds and never be able to sell them. You know? So I like trying to continue to do it the way you're doing it and that's just piece it together and let's build one and let's find somebody to put one in their in a property and a commercial application and let's say let me give you just let's just make up a pretend example okay here? Here would be like your ideal thing. You build one or two in your garage, and you convince these guys, look, this looks rough. We're not looking at the form of it. We're looking at the function of it.

I just want to show you that the idea works. And if the idea works, then what I'm going to want you to do is place an order for 10 of them or 30 of them or 100 of them for all of your locations. Okay? And you find somebody like that that's got an upside to test it, and then if they place that order, they just place a deposit with you large enough to build the order. And it funds itself. That's called organically cash-flowing something. In other words, you prove it to somebody who's going to be a big customer, and they place an order with enough of a deposit to manufacture your first order out.

So you think I should dial down my, rather than just spend all my extra capital towards paying off my credit card debt and my student loan debt? I don't think you have to spend much capital on this. You've already built one in the garage. Yeah. Build another one. Okay. I mean, a couple hundred bucks, right?

Well, it's cheaper than that, but I'm a perfectionist. I want it to be a good-looking prototype. It's a prototype. There are no perfections. The very purpose of a prototype is to find all the crap that's broken. You're not going to get it perfect. You're going to put it out there, and the marketplace is going to kick it around, and you're going to learn form and function changes and form and function changes,

and the switch has to be on that side, and the switch has to be made out of this instead of that, and you're only going to learn that after you beat up about 100 of them. But let's get two of them in somebody's restaurant, in their two restaurants, and they got 100 they can put them in later. Or two of them in somebody's industrial application and they've got, you know, they've got 40 more they will order if it works because it's the best thing since sliced bread. I got to have these. And then they give you enough money in their deposit for the initial order for you to do your manufacturing.

And basically, you've got almost nothing out of pocket except your brain power and your sweat and your smile out there selling it. And that's how a lot of these things get off the ground. The way a lot of people lose a lot of money on them is they go into mass production before something's proven, either the marketplace or the actual prototype. And you're talking to a guy who's lost some money that way, doing stupid stuff. So go easy, man. Go easy. This is the Dave Ramsey Show. One question I get asked all the time is, do I need life insurance?

Listen, the whole point of life insurance is to replace your income for someone who counts on you. So if you have a spouse or you have kids, yes, you need term life insurance. It's the only way to protect them until you're out of debt and have built up your wealth. You're only digging a deeper hole if you waste money on cash value plans since it robs you of the ability to make real progress. And that's why I send you to Zander Insurance, and I have for 20 years. That's where I get all my insurance, and they only offer the plans I recommend. It is not expensive. It's not complicated.

And Zander will be there as your guide every step of the way. Visit Zander.com or call 800-356-4282. You need to get this taken care of. I can give you the advice and I can tell you where to go, but it's really up to you to take that important step to get your family protected. That's Zander.com or 800-356-4282. In the lobby of Ramsey Solutions, Ben and Vida are with us. Welcome, guys. Hey, Dave. Thank you. How are you?

How are you? Excited. Good. Where do you all live? Orlando, Florida. And all the way here to do your debt-free scrim. Yes, sir. Love it.

How much have you paid off? Paid off $98,493.47. Well done. How long did that take? 39 months. Good for you. Your range of income during that time? We started off at about $82,500 and now up to $99,000.

Good for you. Well done. What do you all do for a living? I'm a data analyst for Siemens. And I'm an event planner for Crew. Very cool. Good for you. Well done. What do you all do for a living? I'm a data analyst for Siemens. And I'm an event planner for Crew. Very cool. Good for you guys. Welcome.

Very good. So tell me the story. What happened 39 months ago that put you on this journey? Well, about four years ago, we were getting ready to get married. Yay. And so we had the financial talk. And we realized that we both had about the same amount of debt going into our marriage. And so we knew that that would limit our options in life, whether we wanted to move somewhere or switch jobs, things like that.

So we knew we wanted to be debt-free, but we didn't know how. That was all we knew at that point. And we, at that point and we at that point thought that's really normal and it's just part of being an adult so we didn't know it was even possible and a few months later we got married and we had a few people mention Dave Ramsey and Financial Peace University in passing

and we didn't really put a lot of weight on it we were like okay that's cool, Envelope system sounds complicated. No thanks. And then I was out to lunch with my friend Tasha, and she had her wallet with her, and I made fun of her. And I was like, no, your wallet is huge. What do you have in here? And she said, oh, you know, my envelopes are in there. And so I finally had to ask.

I was like, okay, fine. Explain what this envelope deal is to me, because I've been hearing it. I don't know what it's about. So she told me about your podcast, and I listened on my way home and I just kept listening. And I finally talked to Ben about it and I said, this Dave Ramsey guy has been mentioned to me a few times and it looks like he has a financial plan. And part of that is getting out of debt. So maybe that's something that we need to look into. Um, so that was about a month after we got married and a month after that,

we started our first budget. I hadn't been through FPU, so I didn't know he was supposed to participate in that. And so I did the budget on my own and I presented it to him and I said, you know, if you're willing to do this and he was, um, and I you know, if you're willing to do this, and he was. And I was like, if you're willing to do this, I need you to sign this budget. She made me sign it. Whoa, you already did it, right? Yeah, look at you. She made me sign it. This is a contract.

Yes. Yeah, she knew. You know, I was cautiously optimistic. Yeah. Because, again, I had kind of lost that hope of I would ever be out of debt. I remember, like, thinking, praying, like, man, it'd be nice to just be out of debt. I remember like thinking, praying like, man, it'd be nice to just be at zero again, you know, starting at zero. But she made me sign it and I was like, all right, this is going to be like a diet fad. You know, the next fad for a diet, you get on it for two weeks and then the next thing and, you know, you get back to eating.

So she made me sign it and, you know, I stuck to it. You know, if I put my name on something, that's a big deal. That's my name. That's my word. That's my bond. She made me sign it. And she knew that. That's very good.

I like that. Wow. That's fun. And so the zero-based budget was born at your house. It was. And it's game on. That's it. Game on.

A few months later, we took FPU, or actually we coordinated FPU for the first time. Wow. And we've done it about five times since then. Wow. Well, thank you. How neat. Of course, Dave. And I'm just going to take a few moments to the listeners.

And those of you watching on YouTube, coordinate an FPU class. You don't have to have the answers. Dave and his team on the video have the answers. It's nine classes over nine weeks. Just take two hours a week. That's 18 hours. You know, instead of binge watching TV and keeping up with the Kardashians, how about you teach people how to start keeping up with the Joneses?

Dude, we're going to sign you up. Come on, Dave. Bring it. Infomercial. That's it. Back to our regularly scheduled program, Dave. Well, thank you. Very nice. Well, thank you. Very nice.

Well, it is fun because not only it holds you accountable, but you get to watch people. You really get a front row seat to watch people change their lives. Yeah, and those nine weeks, you know, we've had stories, folks come up to us, and one of the older gentlemen in our class with tears in his eyes just saying, you know, I've never stuck to anything in my life, and I'm doing this, and it's working. I'm going to follow this through. It blesses you. Amen.

It's more than the facts, the figures, and the math. It's really changing lives. I wish we could put our Congress through FPU. They need it. Amen. Wow, you guys are fun. This is great. So what kind of debt was the $98,000?

All dumb debt. It was credit cards, cars, and the student loans. Student loans were the most. What was the one debt that you hated? And when you got rid of that, you went, I hate you people. My student loan. Oh, Charlie May. Yeah, I had it so long, it would have been in middle school.

Like, it was 12 years old i had this loan i just she filmed me when i finally clicked the pay this off button i was just like i can't believe that's gone it's just gone it's just gone did it yeah wow so when somebody's new to the class and they're like i don't know this envelope stuff look how like you were it kind of feels weird or this budget stuff feels weird uh what do you tell them the main thing they have to do if they want to get out of debt? They've got to do these two things or these three things. What do you tell them? I would say the budget.

The budget really sets you up for success for the rest of it. You can't really even do step one if you haven't done your budget. So I think that that's the key. The other thing I would say is being on the same page if you're married and just knowing that you're on the same team, that one person doing it alone, it's impossible. So you have to be on the same team and going for the same goals. Yeah, and then I would say the other thing with that, God was great to us throughout the process.

And one of the things we would constantly communicate about is what does it look like when we're debt free? Like that goal. What's that dream? What's that thing we want to do? Small goals along the way. And then the long term goal. You know, one of our small goals. Again, we discover you right when we got married. So Vita would like to remind me throughout the process when she get a little frustrated. She's like, they've ruined our honeymoon. We couldn't take a honeymoon. You know, but just a couple of weeks ago, cash flowed our honeymoon

to London. So that's it. And so that was, yeah. And we enjoyed our time there and it was cash. And we were still, you know, like I said, we were balling on a budget. Like we, we cash flowed even there when we ate, we didn't spend a lot of money or anything. And, you know, just keeping those little short-term goals and our long-term goal, we always talk spend a lot of money or anything. And, you know, just keeping those little short-term goals. And our long-term goal we always talk about is we want to get to that baby step seven where we can just give. And our goal is to live off the tithe and give 90. Amen. And so that's our long-term goal is to just get to that place.

Reverse tithe. Reverse tithe. Look at you guys. How fun. Your generosity. That's going to be awesome. Well, very cool. Very cool. Very proud of y'all. Well done. Thank you. Do you have people cheering you to be awesome. Well, very cool. Very cool.

Very proud of y'all. Well done. Thank you. Do you have people cheering you on as you went along? Oh, yes. Absolutely. Yeah. You teach that many classes.

You've got a lot of cheerleaders in the corner. Absolutely. Absolutely. Friends, family, coworkers watching. You know, I work. Folks find out what I'm doing, and I share it with them. And they're like, oh, I don't think we can do that. I'm like, you could do it.

You know? Yeah. Anybody can. Anybody can. You just got to decide to. Very cool. Well done. Well, we've, of course, got a copy of Chris Hogan's book, Retire Inspired.

That's the next chapter in your story. Millionaire status and outrageously generous. And you are on your way, man. Well, thanks. And thanks for leading the class, too. It's very, very cool stuff. And, of course, check out Chris's podcast always, too. That is some good stuff.

You don't want to miss it. Ben and Vida, $98,000 paid off in 39 months, making $82,000 to $99,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're dead free! I love it! Well done, well done, well done.

Man, that is fabulous. Well, that's how you do it. And you don't have to be just starting your marriage. You don't have to be anything. You marriage. You don't have to be anything. You just got to decide that you're going to live your life in control. See, that's all they did. They just decided, you know, because they've been told and they started to believe. And you heard the words they used.

Everybody uses those words. I thought I was always going to be in debt. Because we're told that. You're always going to have a car payment. You're always going to be in debt. Because we're told that. You're always going to have a car payment. You're always going to have a mortgage. You're always going to fill in the blank. Stupid. You don't have to always going to.

I'm not always going to. No, I don't ever going to. You can change it. This is the Dave Ramsey Show. Thank you for joining us, America. Nelson is in Philadelphia. Hi, Nelson. Welcome to the Dave Ramsey Show. Hey, Dave.

Thanks for taking the call. Sure. What's up? So I've been listening to your show now for about the last year or so, and I just got on board. I'm on baby step two. I started paying off my debt. I have about $50,000 in debt right now, $45,000 of that being student loans and about $5,000 of that being my credit cards. And I'm currently putting 10% into my 401k right now of my paycheck i make about 42 000 a year okay you're not on baby step two then okay baby step two is you

stop all investing temporarily while you attack your debt. Okay, so that's what you suggest I do. Yeah, that's what we tell people to do. And so the only access you've had to the information so far has been this show? Yes. Okay, I'm going to send you a copy of the book, The Total Money Makeover, which gives you a real detailed explanation of the baby steps and what to do and why and how. Because if you follow that exact plan, it works every time. When you modify it, it doesn't work every time.

Okay. Okay. All right. Well, I think that answers the question because I was putting about 10%, and I was thinking, you you know what based on how you explain things that doesn't sound like that's something you would suggest so it's just a temporary just a temporary thing it's not that i don't like you investing in your 401k when you get to baby step four you easily with no payments in the world except a house payment can put 15

of your income into retirement but the problem is you're delaying how long you get there. And here's what happens. The things that we focus on in our life are the things we're good at. Are you married? No, I'm single. I am 29 years old. Okay. Are you dating?

Yes. A serious relationship? Yes. I've been dating for three years, and I actually plan to make that next step within the next year or so. Okay. So have you noticed that while you're in this stage of your dating, how focused you are on her? What you focus on, you're good at. Have you noticed that?

That is true yeah and so you know it's and it's a behavior thing it's a psychological thing it's a spiritual thing it's an emotional thing and that is is that and so it's more that's more the reason to stop the investing than the math the 10 that you're putting in is not going to cause you to get out of debt that much faster. But what does is when you're like all in, I'm all in like you are with her. You're all in. You're all in. Okay. You're focused.

You're concentrating. And that's what we want you to do with the debt here for a short period of time. I want you to be all in. I'm not doing anything i have no life i'm focused i'm working extra i'm selling stuff i'm not doing anything beans and rice rice and beans i'm getting out of debt okay that's what that's what gets you out of debt that's what gets people out of debt more than the mathematical manipulation so that's what's important about temporarily stopping your investing when you're in baby

step two, and that's why we suggest that. Hold on. I'll have Kelly pick up, and we'll send you a copy of the book, The Total Money Makeover, and it'll help explain that a little bit further for you. Danae is with us in Sioux City, Iowa. Hi, Danae. How are you? Hi, Dave.

I'm a huge fan. I think I use your name so much in talking to people that my name's a cuss word in people's homes too oh i'm sorry how can i help i'm calling about my um my youngest brother he's 20 years old um four years ago he was hit from behind at highway speeds training for a road race my parents are going into litigation for what his future will be like. He is in a job training program, kind of just learning basic skills, like how to, you know, bake groceries, things like that. So he got a brain injury out of this?

Yeah, he has a brain injury, a lot of memory issues and impulsivity. And so I'm not really sure how to, you know, my dad asked me to do some research, and I was like, well, I'm going to call Dave and see what he would say about this legal stuff as far as how to secure a future for Daniel that he'll be taking care of. I'm sorry. What a sad situation. I assume they have an attorney, right? They do, yeah. situation i assume they have an attorney right they do yeah and they've assessed the ability to uh that that the person that hit them had insurance and or assets that make it worth

chasing them around right yeah it's been a long process over four years just kind of seeing what would happen with daniel over this time frame if you know, the effects of this accident. Well, there's a, I mean, there's not a magic thing, but a good attorney in this situation should be able to help you run the numbers out that basically his, you know, this accident has taken away his earning ability for the next 60 years. And that's a very expensive thing that he has lost, has taken away his earning ability for the next 60 years. And that's a very expensive thing that he has lost that they need to pay him for. Millions and millions of dollars.

What he would have earned in his working lifetime is now gone. Yeah. And so to offset that due to the accident is the liability of the person that caused the accident. And you don't have to be an attorney to know that. Okay. And so the calculation of that and, you know, could we get a big enough lump sum that that lump sum invested causes, you know, Daniel's income to never be a problem again and so if you take a million dollars and invest it daniel has an eighty thousand to a hundred thousand dollar income the rest of his life as an example you see what i'm saying and um and that's probably not enough but i mean that's that's a that's an example of a calculation to offset what he would have potentially earned in his working lifetime

because that was stolen from him because of this accident. And I'm not being angry towards the person that did it. I have no idea the conditions of the accident. But that's just the liability that that person and their insurance company has as a result of law. And your attorney should have already told you all of that. That's a basic thing. It's like business law 101, the very first thing he learns, that kind of stuff. So, you know, once you do that, then you're saying we're replacing his lost income,

and certainly then medical bills in addition to that, and medical bills would include any kind of job training we can do to help him have a quality life going. You know, anything we can do to increase his quality of life going forward, right? But there's not a magic number to figure this out. It's just there's a calculation you can do to estimate these things. And, you know, all of those things added together makes the, you know, the settlement negotiation with the insurance company go on. Now, there may be, and there probably is, limits to the insurance coverage, and there are limits not to the liability but to the assets that the person has.

Let's say this person had basically no money, and the insurance company is on the hook for half a million dollars. You can negotiate the rest of your life, and you're not getting more than half a million dollars because the guy's broke and you can't get blood out of a rock. Okay? And so you can sue him into oblivion and it won't do any good. Suing people doesn't make them have money. It just takes money they do have if you win. And obviously you'd win here.

But it'd take a long time. So the settlement may be that the insurance that the person carried maxed out, and it maxes out at their assets. Now, if that person's worth $2 million and the insurance company has $1 million, then your maximum you're going to get out of this is $3 million. Take everything the person had, if you wanted to do that, and get the $1 dollars out of their insurance company, two million from that person.

They sell off everything they've got and give it to you or give it to Daniel in this case. And so that's how the calculation works. But what most folks don't realize is because this is so emotional and so tragic is that the math is limited by the insurance company's max pay in their policy and the assets of the person that hit them those two things added together is the most you're going to get that because there's no magic and money doesn't just appear because something's tragic and this is definitely tragic horrible situation i'm so sorry y'all are facing it but that's that's how your math will shake out so what i'm going to be doing is investigating what the max pay on the

insurance policy is and the asset base of the person who hit them. That's the thing. Two pieces of information I want to know real quick because then it doesn't matter if I calculate $10 million as the settlement offer if there's nobody going to pay it or can pay it. This

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