The Ramsey Show - App - Hard Times Are No Excuse for Emotional Spending (Hour 1)

Episode Date: July 3, 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 am Dave Ramsey, your host. This is your show. Thank you for joining us. It is your show because, well, we take more calls here than any other talk radio show in America. This is a talk radio show where you actually get to talk. I know that's amazing, but it's something you ought to try.

The phone number is 888-825-5225. That's 888-825-5225. Carlin is with us in Oklahoma City. Hi, Carlin. How are you? I'mlin. How are you? I'm good. How are you? Better than I deserve.

What's up? So I am following your plan and on baby step two with my husband. We recently welcomed our second child in March. Yes. Well, he's the reason that we're calling. At our 18-week ultrasound, we found out he has complex congenital heart disease and would require several surgeries to correct that. He had open heart surgery at two weeks old. We'll have to have another one, yes, next or this month or possibly next month

and then another one between two and three years old. Your program has been a life changer for us, and we want to continue to follow your steps. We've paid off, I believe, between $50,000 and $60,000 in the last four years. We have one student loan left at $25,000. And so we're just, I know this makes our path a little bit different, and I just wanted to see if you had any advice on how to proceed. You concentrate on baby boy.

That's how you proceed. Yes. He gets everything. That just takes your breath away. I mean, that becomes the center of your universe right now. And if that slows down or even stops your progress for a little while, well, so what? Right. We've got a little guy here we

yeah we i mean luckily medical insurance has been great there's certain things that you know we're already trying to have to fight to get it approved um and we've been lucky and had some family help and so we have got about 7500 saved just for rainy day. You need to. I would push pause on your total money makeover. I'd push pause on your baby step two. You're right in the middle of a storm. You're in the middle of a hurricane.

Okay? Mm-hmm. And just, you know, you nail up the boards on the windows, right? And, you know, you start the generator and you bring in the water and you you buckle down and you go through the storm the good news about storms is is they don't last forever right and but you're in the middle of a big one kiddo yes and so what i don't want you to do is i don't want you to use this as an excuse to go do something stupid like we had to buy a 65 000 van for this little guy that and go into debt you don't need to do that the little guy can ride in something reasonable i mean you know but i don't want you to use your um if you're a human being that has a heart and you're not psychotic

this is having an emotional impact on all of you. It has an emotional impact on me, and I don't even know you just listening to the story. You know, I got little baby grandbabies right now, and I can't even imagine. It just takes your breath away. So I know, I mean, I can't even imagine what you're going through. But don't let, you know, the emotional state give you an excuse to go do crazy spending of some kind. Don't lose progress. But I'm perfectly fine when you're not making any progress for a while.

I mean, it may be a year. Well, it may be a year. Okay. It may be a year before you get some of these surgeries behind you and you kind of learn learn the landscape, and you learn the rhythm of his special care, and all of that. And the rhythm has financial implications. Every so often, we're going to have a doctor bill that we wouldn't have had otherwise.

And that's just part of your new budget. But you discover that rhythm after as the storm passes you're right in the eye of the hurricane right now and so just hold tight don't make don't make any more don't make any damage don't let any damage occur to your finances but uh and again be careful not to use this as an excuse to say we were we had to we were forced to when you start using phrases like that that's probably not true it's probably you just got worn down scared and your emotional gas tank was empty and you just bought crap you know people do that you know yeah it's it's like when somebody dies they have grief spending you know that kind of thing it's like

it's that type of a thing so just you know be intellectually kind of thing. It's that type of a thing. So just, you know, be intellectually aware of that, spiritually aware of that. But then as far as, you know, is this going to slow down or stop or impede your progress on your baby steps? Yes, and it should. You should concentrate on the thing that is in front of you that is much more important. And we have since he was born.

We definitely have put a pause on things. We just, you know, a big thing that resonates with my husband and I is, you know, living like no one else, we want to, you know, take family trips and do those things. And so we don't, I know that when he gets older, he never wants to hear we couldn't do things because of his condition oh well we don't want that you know well i don't want that but oh well forever i mean hey i got a friend that has eight kids there's things they can't do because they got eight kids oh well you know right i mean it's just part of what life it's just life and i you know i don't know if he

has to hear that or not you have to say that but that might be a reality that you didn't get to do some things because we took care of him. But, hey, this is the blessing that God's given you, the opportunity to take care of him. And if that means you don't get to go to Florida once, well, whoop-de-doop-dee. Right, of course. We just want to get to the point where we can eventually. You will eventually, but let's take a year and live with this. Okay.

And then, you know, I think after a year you're going to have some of the surgeries behind you and you're going to have some of the shock of this, and you'll probably discover the rhythm of life, what it's going to look like going forward, and you can start making some intelligent decisions. But again, that's the cleanup after the hurricane. Right now you're in the hurricane. So the hurricane's hitting your house right now. What are you going to do?

Are you going to live there forever? No. But when the hurricane passes, is life going to be different? Yes. And you're going to find the new rhythm of your new life after the hurricane passes is life going to be different yes and you're going to find the new rhythm of your new life after the hurricane passes and you're going to be fine long term i'm not worried about you long term i just want to give you permission short term to quit making progress okay but don't make dumb decisions that's the balance okay we won't yes thank you so much if

i can help you don't you call me anytime i'm sorry you guys are going through this wow uh okay there you go um i often get questions about a family with special with a special needs child uh kelly our phone screener talked about in her debt-free scream the extra challenges they had to go through and do a debt-free scream with some special needs situations and the extra expenses that go with that. The extra expenses that go with that, they just do. And that just means you're going to go a little slower. You're going to make more money or you're going to take the same money you got and you're going to make slower progress. But you can still make progress and you can still make progress, and you can still make wise decisions,

and you can still be on a plan. You've got to find the rhythm after the storm. And that's where she is right now, bless her heart. This is The Dave Ramsey Show. Identity theft has become an epidemic. Data breaches are being reported every day, and hundreds of millions of people have had their identities stolen, sometimes multiple times. That's crazy. Now, I've seen firsthand when people are stressed and freaked out when they become an identity theft victim.

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and 20 years ago, she purchased a home for $50,000. 15 years ago, she refinanced it, and it went from a fixed to an adjustable and a higher interest rate. And whoever the mortgage broker is had refinanced it with Countrywide. I'm not sure which paperwork she signed, but the gentleman refinanced her home a second time without her permission and named himself as a beneficiary on her retirement account as well as two insurance policies. So there was a nonprofit who tried to help her get out of it sometime later, so they convinced her to refinance it again.

And I think she refinanced it a fourth time because payments were... So the guy that ripped her off, has she gotten to cut him out now with that nonprofit refinance? Right. He's gone, right? So now she owes 78,000 on the home. 78,000? Yes, sir.

Okay. And she's 65 years old and she has no money. Right. And what type of a mortgage? What is the interest rate on the current mortgage? I'm not sure. Okay. Does she have any income?

She makes $30,000 a year. Okay. So she can barely pay her payment? Right. Okay. So what is she going to do when she's ready to not work anymore in five years or more? That's the question. Her body's starting to break down, and she's really tired, and I'm trying to figure out how best to help her.

Okay. Are you got siblings? I do. I have one other sibling. Okay. Are the two of you going to pay the house payment? We're currently not in a position to. We're both in Baby Step 2.

Okay. When she's not able to pay the house, when her body breaks down and she's not able to work and not able to pay her house payment, are you going to pay it? I don't plan on paying it. We're trying to get her to maybe let the house go and maybe move in with one of us, but she really doesn't want to. Okay. What's the house worth? I'm not sure.

I'm guessing between about $60,000, maybe. Okay. If that. I would have a real estate agent look at the house and try to figure out what it's worth. I don't know how she borrowed $78,000 on it if it's worth $60,000. That's not logical. I'm not sure. She doesn't tell me too much of anything.

But, no, she's refinanced it four times. Well, you can't help her if she doesn't tell you what's going on. Right. You can't just punch in the dark and hope you hit something. So, A, she's got to come clean with you and give you good information, or you just can't help her, period. You're not going to be able to. Because you can't assist somebody if you don't have the information.

If I ask you questions and you don't answer them if you don't have the information if you don't if i ask you questions you don't answer them i can't help you right same thing and so um uh you know she's got to be able to give you the information to help her make some decisions but here's the situation if you do not pay the payments they foreclose you know that right that's what's going to happen here in the future. Someday she can't pay the payments. Someday you all don't pay the payments. I don't know whether that's three years, five years, or eight years, but someday somebody's not going to pay these payments or somebody is going to pay the payments.

But if you don't pay them, the house is going to be gone. This is the reality that she's in. And what it amounts to is she's tried to refinance her way into oblivion, and every time she's gotten into a rough spot, she's refinanced, and there's not going to be any more refinancing. It's over. So, you know, what you're doing is you're looking into the future, and you're seeing a truck headed towards this house,

and there is a truck going to drive right through this house. That's what's going to happen. So, you know, one of two or three things is going to happen y'all are going to pay the payment she's going to pay the payments by working the rest of her life um or the house is going to be worth more than is owed on it and she's going to be able to sell it and get out of it before it gets foreclosed on and move in with one of you all or she's going to lose it to foreclosure and move in with one of y all, or she's going to lose it to foreclosure and move in with one of you all. These are the four really options, aren't they?

Yes, sir. And so, you know. I'm more concerned with trying to, what she's going to do. You know, she has no money to retire with, so. Yeah, yeah, she doesn't. I mean, if she's 65 years old and she's making $30,000 and she has a $900 house payment, she's not going to have a lot of money in the next five years.

So either her income changes or her income changes if she wants to have some money to retire with. She's going to have to do something to make some different money or more money or something here because she's painted herself into the corner when you paint yourself in the corner you get paint on your feet right i mean that's what happens so it's a horrible thing but there's no magic wand to just make this go away because she's made a lifetime of bad decisions and they've they're coming home to roost and And, I mean, you plant this much negative stuff in the ground, it grows. And it's just horrible. I'm so sorry for her.

It's so sad. But I don't have a – there's no formula to fix this. So all you can do is help people address the realities of their situations. She's got Social Security coming in, and she's living with one of y'all. She'll be okay. She's got a place to live, and she's got food. And she's going to make it –'all, she'll be okay. She's got a place to live, and she's got food. And she's going to make it, you know, she'll be okay. She's not going to be homeless, and she's not going to starve to death

or something like that. But this house, it's got a long-term future to it, unless your siblings agree to pay the bill at some point. You're in baby step two now, but someday you're in baby step seven, and maybe she's still working then, and she's 73, and maybe then she quits work and you all pay the payments, or maybe the house has gone up to where it's worth $100,000, and she owes $70,000 by then, and she can sell it and make a little bit of money

and move in with one of y'all. I mean, this is the future of this, and it's just what it must do is you're not in denial, and she is, and you're trying to figure out how to address it. So the more you talk about it and the more she'll give you real information, the more you all can start to make long-term good decisions. But she's not going to retire a millionaire. She's not going to with the numbers you gave me, unless the numbers change. She's just not going to.

I'm sorry. Morgan is with us in Trenton, New Jersey. Hi, Morgan. How are you? Good. How are you? Better. How are you? Better than I deserve. What's up?

So I've been trying to start working on my debt snowball, and I made a bad choice a few years ago. I leased a car and ended up getting a new job and went way over the mileage. So a year ago now, I had to buy the car because I couldn't afford to pay the mileage over it. So now I'm looking at, I'm in a car that has just over 100,000 miles, and I owe 18,000 on it, and it's worth about maybe 10. Who said?

According to what I did online, like the Kelly Blue Book. Private sale or wholesale? Private. It said like $12,000 in mint condition, and the car is not in mint condition. Okay, so it's worth $10,000, and you owe $18,000. What's your income? $65,000. And how much other debt do you have? A lot of student loans. How much? and you owe 18. And what's your income? $65,000.

And how much other debt do you have? A lot of student loans. How much? I pay $400 a month. How much in student loan debt? Like $70,000. Okay. What other debt?

That's really it, actually. Okay. How old are you? But it's a lot. 30. You're 30. Okay. How old are you? 30. You're 30. Okay. How many kids you got?

One. How old is the child? She's eight. She's eight. Okay. And I take it from the way we're discussing this that you're a single mom. That's right. Okay. Do you have family nearby?

I do. Do you own a home? I don't. You have family nearby? I do. Do you own a home? I don't. So a year ago, I moved back to my parents' house with my daughter. Good. So you've got very low expenses, and you've got somebody to help watch your child. Yes.

Okay. Because here's what you just told me. You just told me you have $88,000 in debt, and you make $65,000 a year. Right? Right? Yes. 70 plus 18, okay? So I divide 88 by 20 and I get four years and some change. It means you're working an extra job on top of everything else

and you're going to work every single hour that you can find for the next three years and you can pay off the car and all the student loans, but you're going to have no life for the next three years so that you can have a life later and so this child can have a life later. You cannot stare at this mountain and not climb it, kiddo. This one's got to be climbed. You've got the chops. You can do it. Get after it. For years, I refused to endorse any company that claimed to get people out of timeshares.

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They have exited thousands from their timeshare burden this year alone. Yes, you will write them a check, but they stand behind their guarantee. They will get you out, or they'll give you a full refund. Call 844-999-EXIT. Online at timeshareexitteam.com. In the lobby of Ramsey Solutions, Nick and Jody are with us. Hey, guys, how are you? We're awesome, Dave. Welcome. Good to have you. Where do you guys live? We live in Mora, Minnesota, just north of Minneapolis.

Oh, fun. We're going to be up there in the fall. Awesome. Love to see you. Yeah, looking forward to having an event up there. It's going to be a blast. Well, welcome, guys. And you brought the kiddos with you for the debt-free scream. What are their names and ages? We have Joseph, Olaf, Etta, and Anya. Ah, very cool.

Love it. Well, welcome, guys. Good to have you. And so how much debt have you paid off? We paid off $60,000 in five years. Very good. And your range of income during that time? We started at $70,000 and we ended at $85,000.

Cool. What did you all do for a living? The dream was Jody had to stay home. And in order to do that, I went and got my master's. I got an advanced degree and I'm an administrator at a high school in Minnesota. Okay. All right. So this was all student loans?

No. No, Dave. This is our house. So this was all student loans? No. No, Dave. This is our house. You paid off your house? This is our house. I'm looking at weird people. You are looking at weird people. I love it.

Congratulations. How does it feel to not have a house payment? It feels amazing, Dave. I can't wait for it to sink in. I bet. Wow. Very cool. Very cool. Very cool.

How old are you two? 39. 39, yeah. Not even 40, and you got your house paid for. What's it worth? Right now, houses in our neighborhood are going about $180,000 to $200,000. And you own yours. And we own it.

I love it. That's so fun. Absolutely. Well done, you guys. So what put you on this journey five years ago well dave our story starts uh actually uh 14 years ago um in 2004 i gotta think when when i found out i was pregnant with our oldest son joseph we were surprised uh we hadn't been married a year yet and we were very normal.

We had a house. We had bought a house, and we had a truck loan and a student loan and everything else. And we discovered you on the radio, actually, KWLM in Wilmer, Minnesota, where we lived. And then Nick lost his job. Oh. Because that's what happens when you're a teacher in your first year and there's education cuts. He lost his job. And you're pregnant.

You got bills, of course. Pregnant, bills, lost a job. That causes you to lose a job. Dave, I was. It's just like if it can go wrong, it will. Yeah, absolutely. And everything went right after that. We found you.

We started dumping debt. We sold the house. We moved into something that we could manage better. And baby number three, baby number four, a master's degree, daycare. Oh, my gosh, that's that expensive. Everything was cash flowed through that. Wow. And the goal was stay home with the babies.

Yeah. And in order to do that, it took the master's degree. It took the advanced degree. Yeah. It took moving away from our family. Yeah. And that was extremely important. And we have a pay-to-for house, and mama gets to stay home with the babies there you go we're definitely the story of the tortoise that's all right you got there the tortoise wins every

time i read the book yeah so five years to pay off the house but 14 years on this journey wow very amazing good for you guys what do you tell people the key to getting out of debt is? Self-discipline and... Persistence. Never give up. Never give up. Portis in the hair. And to find small things along the way, to break it up into baby-sized chunks. You know, you say eating an elephant one bite at a time, but to have a small goal in front of you and to keep coming with those small goals.

What was the small goal out of the different small goals that you set? What was the one that you hit that kind of gave you the real spark that you went, oh, that one took me over the top? It goes back almost 13 years ago. We just started a new job in teaching, and Christmas is around the corner, and we had to save $500 for Christmas, and that's a huge amount of money. And my truck broke down. And Christmas was around the corner, and we had to save $500 for Christmas, and that's a huge amount of money. And my truck broke down. And Christmas was ruined.

And then Jody calls me and says, we have about $495 in our truck emergency fund. And the bill came in about $490. Unbelievable. Christmas was saved. Dave, common sense, it's all true. It works. We jumped on that journey right then and there,

and that's the story we tell in all the churches. As coordinators and teaching groups for six years now, that's the story we tell. That's when we knew this stuff works. It really works. And you guys have been leading classes that long. Thank you so much. You're very welcome. That's amazing. That was another dream

of mine. When I stayed home with the babies, I needed something to do. And we started leading the class and it's just been such a blessing for us to get to know people in our community and to rock with them and have them with us here today. Oh neat. You got something that came with you?

We have some family that came with but there's a lot of people watching live on YouTube right now and people know we're here Facebook everything. We're very weird and there's a lot of people getting weird with us up in Mora right now and people know we're here, Facebook, everything. All right. We're very weird and there's a lot of people getting weird with us up and more right now. Love it. Well, we're honored to be part of the tribe, man. Well done, you guys.

You're heroes. I'm proud of you. You changed your family tree. You know that? Without a doubt. You did it. I'm looking at these kids. They're different.

They walked this whole journey literally from the time in the womb to right here, right now in our debt-free screen. They've never lived any other life. Yeah. They haven't. This is wonderful. Well, congratulations, you guys. Very, very proud of you.

Thank you. Well done. Got a copy, of course, of Chris Hogan's number one best-selling book for you, Retire Inspired. Thank you. And, of course, that is the next chapter in your journey. Now you've – it doesn't stop here. Now you've become millionaires. And you've become outrageously generous as you go along.

We finish changing the family tree we've taken the first big leap forward no house payment wow i love it all right nick and jody joseph ola it's olaf isn't it it's oli okay oli is what they typed in here and anya and edda i want to make sure i get the names right. Way to go, kiddos. $60,000 paid off, house and everything, five years, making $70,000 to $85,000, mom's home, count it down, let's hear a debt-free scream. Three, two, one. We're debt-free! That was a long time coming.

I love it. I love it, I love it, I love it. Absolutely fabulous. This is how it's done. Amazing stuff. Wow. Good, good job. Our question of the day comes from blinds.com.

They have a 100% satisfaction guarantee. It means even if you mismeasure or you pick the wrong color, they will remake your window blinds for free. You get free samples, free shipping, and new promos every month. You save even more. Always use the promo code RAMSY at Blinds.com. Robbie is in Virginia. For the child of an adult who is a senior citizen who is not prepared for retirement,

do you believe that children should be burdened with helping provide assistance to an otherwise healthy adult who neglected to prepare? Based on your wording, Robbie, you don't believe that. This is not a question. Folks, this is not a question. Folks, when someone asks a question that is actually a statement, that's called a passive-aggressive question. When you ask a question, like my wife says, are you going to wear that? That's not really a question. That's more like a statement that you shouldn't wear that.

That's a passive-aggressive question is what it amounts to. And, Robbie, you don't believe that you should be burdened with a senior citizen, apparently your parent, who is otherwise healthy and has not prepared for their retirement. And if you don't want to be burdened with that, that's fine. I don't care. I get that you're aggravated with them because they've been irresponsible um i understand that and uh you know it amounts to what is the burden i talked to a guy who was making his personal income was a million and a half

and he was questioning whether he ought to give his dad a thousand dollars a month his dad had been irresponsible didn't do things right and was you know in ill health in that case and was in his late 70s so yeah you give that guy a thousand dollars if you make a million and a half but if you make two thousand dollars a month month, are you required morally to starve to death in order to take care of an elderly parent who did a bad job? No, you're not required morally to do that. So it's a matter of relative. Do you have the money? Is it going to affect your family? And if you do and it's not going to affect your family, it might be just your aggravation that you're really asking about,

not your moral obligation. And so, you know, aggravation is different than moral obligation. But no, I'm not morally obligated to destroy my family in order to take care of a relative who didn't take care of themselves. But can I help? I've got the money. Yeah, if you live like no one else, later you can live and give like no one else. Are high health care costs getting you down?

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It's what Christian Health Care Ministries has done for over 35 years, Thank you. Ramsey Live Events, chministries.org. Cody is with us in Savannah, Georgia. Hi, Cody. How are you? Hey, I'm doing well, Dave. How are you? Better than I deserve. What's up? Just got a question about buying a house versus renting. First off, I want to say whenever we started this program, it was about halfway through our house buying experience. And we have about $37,000 in debt

that we really didn't even know was that high until we started doing the program and doing the budget. I guess the question is is should we stop our house buying uh now or should we and finish renting um sorry stop stop your house buying what does that mean you you are you like are you under contract home? We were under contract. Were or are? We were under contract, and I canceled the deal. Okay.

So you're not under contract now? No. Okay. No, I'm not. No, you should not buy a house. Okay. You have $37,000 in debt. You're broke.

Yes, sir. And when broke people buy houses debt. You're broke. Yes, sir. And when broke people buy houses, it makes them broker. Oh, yeah. I know that. I guess my other question was, I guess with interest rates, I guess interest rates are going up substantially. I mean, it has since the beginning of the process to now. It's gone up a pretty good bit. Cody?

I guess is that something cities should worry about later on? Cody, I got my real estate license in 1978 in September. In October, rates went from 9.75 to 10 for the first time ever. Yeah. People bought houses. Rates are 4. When they go to 5, people will buy houses. When they go to six, people will buy houses.

It's not going to keep you from buying a house. Yeah. No, I guess it's just you always hear about the higher end is right, oh, your payment is going to jump up so much more. You hear about that from people who don't know how to run a calculator and who are broke. Yeah. Usually a real estate agent trying to sell you a house, too.

Yeah, that's kind of exactly what I'm talking about. How old are you? 25. Okay. Here's the thing. This show is about creating a situation with your money where your money doesn't own you. You own your money. Where you move towards wealth and the shortest path possible.

That's what this show is about. Financial peace. Two words that don't go together like airline service. Okay. That's what this show is about. It's not about you keeping up with the joneses the joneses are broke if you even know who they are these people that post crap on instagram and they post crap on facebook they only put the good parts of their life on there it's their highlight reel dude it's

not real you can't compare yourself to them the vast majority of people are broke 70 of americans live paycheck to paycheck seven out of ten people you walk past going down the sidewalk are broke you can model your life after them and you will be one of them yeah that's not what i want okay all right or you can model your life after the weird people because wealth is unusual it's not normal and so you have to engage in unusual behaviors and habits to create unusual results agreed correct it's not normal to win the super bowl the people that win the super bowl are admired because they did something other people couldn't do or wouldn't do. They paid a price.

Okay? Yes, sir. So when you are 65 or 70 years old and you're a multimillionaire because of this conversation, you will be yelling, yay, way to go, 25-year-old Cody. Yeah. If you go do smart stuff. So here's what I'm going to tell you to do. I want you to get a house. yelling, yay, way to go, 25-year-old Cody. Yeah. If you go do smart stuff. So here's what I'm going to tell you to do. I want you to get a house.

I just don't want your house to get you. Don't panic. Don't panic. You're 25. I'm sorry, go ahead. You're going to get a house. You're going to get a house. And there's no mathematical justification for you buying a house,

no interest rate justification for you buying a house, while you have $37,000 in debt. You need to clean up your debt. You need to get out of debt. If you move into a house with this much debt and no money, Murphy is going to move in your spare bedroom. The guy, if it says it can go wrong, it will. He'll bring his three cousins, broke, desperate, and stupid,

and they'll set up housekeeping with you, dude. Your life will look like a country song. This house will be a curse instead of a blessing. I want it to be a blessing. So here's the option. You move in now like all your friends are doing, and all these idiots that are broke that are pressuring you to buy a house right now when you're a broke 25-year-old young married guy, and you're going to make a mess,

and it's going to take you a decade to clean this mess up if you do this. Or you can be weird. You can roll up your sleeves, and you can become debt-free very, very quickly. And I'll show you how. And you can save up a good emergency fund of three to six months of expenses. And I'll show you how. And then you can save up a good down payment. It's going to delay your home buying by a couple of years.

But when you move in the house with twenty thousand dollars cash in the bank and no payments the house is a blessing not a curse when you move in the house right now the way you're set up right now it's gonna be it's gonna be more stress how long you been married uh we've been together or we've been married about a year and a half and we have a uh she's going on eight months old now. Yay. That's wonderful. Number one cause of divorce in North America today, money fights and stress. Oh, yeah. That's where our, I mean, that's the only thing that me and my wife really ever argue about.

Yep. And, I mean, I have a great job. What's your household income? Well, my base pay is around uh seventy seven thousand dollars what's your household income cody anywhere but well i made 110 last year but i'm on the track now for like 130 and it's all because of overtime i work 70 hours a week your money making machine dude and does your wife work outside the home no that's the thing is i want her just where she doesn't have to work that's fine she doesn't she doesn't you make 130 so how fast

can you pay off 37 000 making 130 my calculations say a year yeah my plan was to try and get it done within a year but i didn't i guess i guess stuck in the you know do i buy a house now you know you know that's the thing you have to do that's why I've been talking to you for five minutes trying to get you unstuck. I want you unstuck. Okay. Because you make really good money. You have the opportunity to clean this debt up and build your emergency fund to three to six months of expenses and then save your down payment

and buy the house on a 15-year fixed where the payment's no more than a fourth of your take-home pay. You're going to get that house paid off in about seven or eight years. By the time you're 35, you're going to have a paid-for home and a couple hundred thousand dollars in your 401K. By the time you're 40, you're going to be a millionaire. Work sooner the way you're going if you do what I teach you to do. But if you go be normal and you strap yourself to a house you can't afford

and you keep that debt around like it's a dadgum pet, you're going to be normal. And you're going to be a rat in a wheel, and all your money's going to come in, and all your money's going to go out, and you have no freaking idea where it goes, and you're going to be a broke 40-year-old that's worked two decades of his life looking at your kids, can't figure out how you're going to pay for vacation and Christmas. And that's normal out there, man. You know it's normal. You know what I'm telling you is right.

Oh, absolutely. And all these's normal. You know what I'm telling you is right. Oh, absolutely. And all these broke people have opinions about money. Mm-hmm. And that's like asking, you know. I made a mistake of budgeting. I mean, on overtime, I didn't have an issue. Yeah, yeah. I made a mistake of budgeting on parts of my overtime.

Which means you have to work overtime the rest of your life. Yeah, I don't want to do that. Yeah, so what we're going to do is we're going to work like no one else right now, so later we can work like no one else, which is by God when I want to. So have you and your wife been through Financial Peace University yet? Yeah, we are finishing it right now, the actual steps right now. We're doing the program right now. I'm sorry, did you go to the class?

Did you go to the lessons? No, we're doing it on our own. You're doing it online? Yes, sir. You're signed up for Financial Peace University online? Correct, yes. Okay, good. And that's why I would join a group in your area if I were you

and go to some of the lessons with a group and get some other people around you that are walking the same path you're walking because you need some people around you that aren't normal. Right now, you've got broken people in your ear. You've got to get them out of your ear. You become who you hang around with, man. Be careful. Hey, it's good to talk to you, Cody.

If I converted you, I just made you a millionaire. If I didn't, you'll be normal. It'll be up to you, my son. This is The Dave Ramsey Show. Hey, guys, this is Blake Thompson, chief production officer for The Dave Ramsey Show. Here's a tip. To keep from missing Dave's classic facial expressions to some of those calls, make sure you watch him live.

Just visit DaveRamsey.com slash show each day from 2 to 5 p.m. Eastern. Enjoy. Folks, the real estate market is on fire all over the country. If you're looking to buy a home and you need a mortgage, don't sell yourself short by going and getting a typical pre-approval. That's a false sense of security, and it's just not good enough in today's fast-moving market. Instead, call Churchill Mortgage and get their certified home buyer program. I'm telling you, it's a game changer. Churchill helps my listeners become fully approved before they go house shopping. In other words, Churchill does upfront what most lenders

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