The Ramsey Show - App - Help! I Put My Brother’s Business Debt Into My Name (Hour 1)

Episode Date: April 7, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: "I put my brother's business debt into my name", Setting up my will to protect your kids, "Should I keep my long-term care policy?" "How can I save for a house after graduating?" Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Warshaw, Ramsey Personality, is my co-host today as we answer your questions about your life and your money. Thank you for joining us. We're glad you're here. The phone number is 888-825-5225.

The call is free, and some say the advice is worth exactly what you pay for it. Oliver starts off this hour in Canada. Hi, Oliver. How are you? Hello, Dave and Jade. It is an honor to speak with you both. How are you today? How are you? Better than we deserve. How can we help? I am good. I have a question. It's kind of complicated, so I'll explain it as best as I can.

I'm going through the baby steps. I've been listening to you since 2017. And, uh, I had made it to what I thought was baby steps four and six. I'm not sure if I'm actually really there. Um, because, um, me and my brother have a partnership business, the small business that we do together. And, um, back in 2018, I foolishly took over, um, some debt that he had created with a lot of business expenses, but it was on his own credit card, but still tied in with the business. Um, cause he was trying to be approved for a mortgage. Uh, so in order to get that mortgage, I had to, well, I didn't have to, but basically he had to get rid of that debt out of his name, and I foolishly put it into my name. I know that was a stupid thing to do, but that's what happened.

And basically, while doing my budgeting since that time, I'm like, as far as the bank is concerned concerned that debt is in my name now so that's my debt even though i didn't create any of that debt it was all my brother so i'm just wondering on if i should go about the baby steps by sorry i'm just a bit nervous that's okay um no dude it's real simple you're in debt you're in baby step two yeah yeah i mean it's real simple. You're in debt. You're in Baby Step 2. Yeah. I mean, it's a long, convoluted, crazy, stupid story how you got there, but, you know, you're in debt. How much is it, Brandon?

It's about, let me see, there's about $19,000 left. Okay, and how much is in your emergency fund? So I did have $14,000, which left. Okay. And how much is in your emergency fund? So I did have 14,000, which is another story. I had to take about 4,600 just this past month in January to pay myself because I wasn't able to pay myself from the business. It's not the most profitable, which is another issue that maybe I should call again about or call call ken coleman yeah but um there's about uh 2600 left in my emergency fund 2600 i thought you started with 14 000 and took out 4600 how did you get to 2600 sorry let me check that so unless you were doing more with that money, you should have around $10,000 left, right? If you only took $46,000.

So I'm just looking at my numbers here. Okay, so here's the deal. I think I went into it a couple times. The business, based on the fact that your brother ran into debt and they moved the debt over to you, and now you're having to use money out of your savings to eat from the business, it doesn't sound like this business is much fun. No, it's not. and they move the debt over to you, and now you're having to use money out of your savings to eat from the business.

It doesn't sound like this business is much fun. No, it's not. So let's go get a job. I'm doing a side hustle right now. It's not much, but it's flexible. It needs to be a lot. You need a job. Yeah. You need money to eat with, and you don't have money to eat with.

Well, I don't know how to do that because it's like me and my brother are the owners i have employees it's a small business i have three employees we've either got to get the income up from the business or we need to close it it's not a business when it's losing money it's a hobby well that's the other issue i'm trying to you know me and my brother don't agree with um certain things on the finances and all of that. And he thinks credit cards are fine. Even more reason, even more reason to close it. Have you ever watched the show Shark Tank? Yes. And Mr. Wonderful says you need to take this business out back and shoot it. Yeah. I've already spoken with my brother about, you know, I'm not enjoying

that. I've told him very clearly I'm not liking how this partnership is going, even though I care for him as my brother. But, you know, I've already told him, like, You guys aren't making enough money to run the business. So it could be you just turn the keys over to him and let him have it, and then you go get you a job. Do what? I've told him that I would just start my own business you know doing the

doing the same type of business of of what i'm doing now just make just be the sole owner i've told them that that's an idea i'm thinking about you know to not have a partnership just have me run my own business well somewhere you've got to get money to eat honey that's what i'm saying okay yeah i hear you and then we and then we can attack the 19 000 in credit card debt that is now your credit card debt because you just you decide to make it yours so now it's yours and um so there's two issues on the table one is how do we get out of your credit card debt of 19 000 and the answer is first thing we do stabilize our income and get some income and then some income.

And then the second thing is we're going to start the baby steps, which is $1,000 left in your account because everything else went to the $19,000. The credit cards are cut up and closed, and then you attack them with a vengeance with your extra job, your six extra jobs, and your side hustle and grind. And then you clean that mess up and you move on. But what all of this is doing, sadly, Oliver, is it's going to make you face what you didn't want to admit. So my friend Henry Cloud wrote a book called Necessary Endings. When is it necessary to end a job, business a relationship it's when there's no hope in the future in your mind that it's going to get better and so uh you know my boyfriend's does drugs okay there's no hope that that's going to get better is when you axe the drug using boyfriend gone, right?

If not sooner, but absolutely. But yeah, but I mean, same thing with business. When do I close down a product line at Ramsey? It's when I lose hope that we can ever make it work. Right. Until then, I'll go at it, you know, but winners never quit. Yes, they do. They quit doing stupid stuff. And yet another time when the

facts are your friends because you can look at the bottom line you can look at the facts over the course of the time of this business and see hey like it's not making money and it's not good for our relationship i have a feeling brandon i think he loves the people that work there and he wants them to be all right and you know but still too late it's too late too late you've lost control of your ability to provide for them because your brother's out of control the business is not working you're not making a living all of these things are indicating indicating indicating this is probably coming to an end unless you have a reason to have hope about the future but everything you've told me doesn't give me much hope

for the business in the future, in the current state that it's in and the way it's being run and everything else. So if you say, okay, these three things change, then I would have hope. Okay, then you could submit

those three things to be changed or the change is going to be, I'm out of here. That would be my choice. Just being honest. Yeah, pretty quick. Only ship that won't sail, folks, Out of here. That would be my choice. Just being honest. Yeah. Pretty quick. Pretty quick.

Only ship that won't sail, folks, is a partnership. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever to get anything approved through the bureaucracy. So if you feel like the system is working against you, try a biblically-based alternative to health insurance,

Christian Healthcare Ministries. CHM is a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of over $11 billion in medical bills since 1981. And CHM has also helped them stay true to their values and avoid miles of red tape. And CHM support goes far beyond meeting financial needs. They'll also help meet spiritual needs. Members become part of a family who will pray

with them and for them when they experience a medical event. So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget. That's chministries.org slash budgets. Jade Walshaw, Ramsey Personality, is my co-host. Thank you for joining us, America. Open phones at 888-825-5225. Today's question of the day is brought to you by Neighborly, your hub for home services.

When something in your home breaks, Neighborly is the name to remember. You know it by names like Mr. Reuter or Molly Maid or Mr. Electric and many, many other wonderful names. And the Neighborly Done Right promise. With that, you'll know you're getting great service from their network of local home service providers. It's an incredible company. We are honored to have them sponsoring our question of the day. So go to neighborly.com today.

Today's question of the day comes from Andrew in Wisconsin. He says, I'm in my mid-50s with two kids. I've done relatively well in life, but have had some problems in life, like cancer. I recovered thankfully, but it does run in my family so I'm worried about how long I'll live and I wrote a will last year. I have a son and daughter in their 20s. One is doing well the other not so much. My youngest daughter has struggled with addiction to opiates and has gone to rehab several times. Although she has been sober now for several months I'm well aware of the idea that once an addict,

always an addict. How should I set up my will so that I keep my daughter safe when I pass? My friend suggested that I request it gets paid in annuity as opposed to a lump sum. I'm looking for your advice on this. That's a really, really good question. Well, I'm glad that you're doing well from the cancer. You know, I would suggest,

I think it's a great thing that you have a will, but I would suggest also getting a trust in place. And I'm telling you that because it's going to allow you to determine how this money is distributed and all the different terms around it. My husband and I are actually walking through that with our trust and with our kids. A will is a great place to start. But if you if you have those things that you want to delineate with your children, you're going to have to take it a step further and get a trust. And so that's what I would suggest to you. And just put in there whatever you want to, Dave, I know you've got a whole lot of stipulations on how these things work out, especially when it comes to addicts. You know, you got to you got to be careful there.

Yeah, your your friend is wrong. An annuity won't work. That will be a steady stream of payments to buy opiates with. The annuity doesn't turn on or off based on her addiction. Right. And so you can set a trustee on a trust, and the trust can be formed at your death, at the direction of the will. You don't have to put it in place now. And her portion, your son's portion, could be formed at your death at the direction of the will you don't have to put it in place now and her portion your son's portion could be just released to him

her portion could be left into trust and um you know i i would release amounts of money based on years or months of sobriety because what we're trying to do here is not finance her addiction and um and and not jar her and knock her out of the saddle of sobriety so i mean let's just pretend okay let's just throw out a number that to her is big whatever that number is could knock her out of the saddle because she has this sense that now she has a new source of uh of a provision for her whole life and so she relaxes a little bit in the in the fight to stay sober that's good and so um if she perceives a hundred thousand dollars to be a lot of money it's not in these situations but if she perceives that it could knock her out of the saddle so i would personally leave it into a trust and get with

an estate planning attorney and um have the trustee uh monitor her sobriety and if she's attending aa for instance uh you would get a coin at various milestones and based on those milestones you could release money at the one year you know she's already been sober for a while it sounds like that's good several months um and but i mean at a one-year mark a two-year mark a five-year mark um or you could increase it or you could release it all at a certain mark if someone's been sober for five or ten years you know they've done especially from opiates that they you know i'm not an addiction expert but sadly we work with a lot of addicts so we've learned a lot because a hundred percent of addicts have money problems stuff's expensive

and so um uh yeah uh anyway we get to learn a lot about it sadly and um as a layman not as a medical professional but anyway all that to say opiates if she can stay dry five years she's probably dry for life yeah and he's in his mid-50s you're you're gonna god willing be able to watch this yeah throughout the next 10 years and make those adjustments you could just do away with the trust at some point like if in other words, let's say you live 10 years and she's dry for 10 years. You could say, all right, I don't need the trust and redo your will.

But in the meantime, if you're going to do it today, I would just say, okay, give some milestones and you could work with her counselor. You could have the counselor report to the trustee and they have to have the, she has to sign the right to do that in order to get money, because the counselor cannot report her information legally without her permission. But she could say, okay, in order to get funds released, the sponsor from AA has to, whatever it is, and then the trustee, whoever that is. I would not make your son the trustee.

I don't want him to be his sister's keeper that's a good point i want him to just be able to love her as and support her as her brother not the keeper of her money and you should have these discussions with both of them yeah talk about it yeah talk about it that's a really good point anytime you're dealing with adults and a will of any kind yeah just say look if you're going to piss people off do it while you're alive okay tell them you're not in the will you're not in the will okay it's not fair for everybody else to have to deal with your actions after you're gone and everybody else is emotional about it so you need to have a reading of the will or essentially that where everybody knows what's going on here and you know and it's real easy with her i'm just going to say i love you so much

that i'm not going to finance a potential relapse absolutely and so i'm going to dole this out based on sobriety because as an act of love not as an act of punishment for your addiction and talk to her about that while you're alive because trust can't convey the emotion of a dad right it's loving his daughter well right and so that this is an excellent time to do that. So it's a really good point, Jade. And just a reminder, everybody needs a will, right? Everybody needs a will. Everybody doesn't need a trust, but there are times when it's the best choice for you.

Yeah. And the only time you're going to have ongoing trust typically are special needs child is going to be ongoing throughout their life. A situation like this is going to be ongoing, but it's probably not forever. It's not perpetual. Right. And the only other ongoing trusts are where there's like large estate, where you're trying to manage the estate out of the trust, not just keep from harming someone that you're leaving behind. Right. Like your children, if you've got minor children and none of them are special needs, you might just have a trust until they're a certain age, and then it evaporates and the money's distributed to them.

And that would be normal as well. So fun stuff. Fun stuff. Yeah. Go to MamaBearLegalForms.com if you don't have your will in place, and they can help you with basic trusts as well. If you need a complicated thing, like this one's a little complicated. I'd probably see an estate planning attorney.

It's worth a few hundred dollars to get this done right and to have someone that teaches you and consults with you about what the law allows in your state on managing that distribution. But the annuity is not the answer. Arnold is with us in Houston, Texas. Hi, Arnold. Welcome to the Ramsey Show. Did we get your phone fixed, brother?

Yes, sir. How are you doing, Mr. Ramsey? Better than I deserve. That is so much better. Thank you, sir. How can I help? Well, I've been following your show for about a year now, and finally decided to start doing things the way you teach.

And while I got a little bit of a question, I'm about to start that snowball, and I want to know if it's a little bit different in my case. So I have a motorcycle loan that my ex-girlfriend took out for me. I crashed the motorcycle, and I injured myself pretty badly. After a couple of months of litigation, I got a settlement that's just enough to cover the loan about fifteen thousand dollars um so what i'm wondering is do i dump that into this that snowball or do i pay off do i pay her off so that she can uh you know be out of my life for good and i can be out of hers you pay her off i pay her off yeah it's the right it's the right thing to do you need to it's not fair to her yeah this whole this whole move was dumb on her part your part and because and you can tell why

now because it's left you in a lurch emotionally and relationally and so and this money was for the motorcycle from the motorcycle about the motorcycle so you just pay her off and that's clears it so it's not it's not a random piece of money right yeah i would do the same thing get her out of your life if you you use those words get her out of my life yeah and my guess is she feels the same way yeah this is the ramsey show thank you for joining us, America. This is The Ramsey Show. Jade Warshaw, Ramsey Personality, is my co-host today.

Thank you for joining us. Doyle is up next in Cincinnati. Hi, Doyle. How are you? Fine. How are you? Better than we deserve. What's up, sir? I've got a long-term care policy I've had for 20 years. I got it when I was 55, and it's just gone up 40% in one year from 2,900 to 4,100. And I'm just wondering whether I should keep this or just not continue with it any longer.

How much money do you have? Well, I have enough money to pay the 4,000. No, that wasn't what I asked. I asked how much money you have? Well, I have enough money to pay the $4,000. No, that wasn't what I asked. I asked how much money you have. Well, I have an income. I'm retired of about 70, well, about 85 with interest on it. Do you have any nest egg?

Yeah, I have about a half a million nest egg. Okay. Are you married? No, I'm single. Okay. So if you burn through the half a million nest egg. Okay. Are you married? No, I'm single. Okay. So if you burn through the half a million to take care of you in a nursing home, just your inheritance is harmed, am I correct? Correct.

Okay. The average nursing home stay is 2.4 years. Okay. And the average cost is $80,000 to $100,000 per year. Okay. So we're talking about a quarter million dollars is your typical burn on this, and you've got a half a million dollars. Correct.

That's the average. Averages come from some are shorter, some are longer, right? Right. So that's your analysis. Do you want to self-insure through this or pay for that? Is it $4,100 a year? That's what you're saying, right? Right, yeah.

It's going from $2,900 to $4,100. And it covers you for, what, four or five years? Well, it's unlimited, $3.41 a day daily benefit, 2% inflation factor. Okay. And I've paid in about $50,000, which I could use for, you know, probably a few months coverage if I discontinue it. Who gets the half million if you die? No, not if you die, when you die.

Yeah, my family. Who's your family kids uh no just a brother and nephews okay well basically you are 4100 is probably not a bad trade for a 75 year old for 80 000 a year 100 000 a year,000 a year, $100,000 a year. Probably not a bad trade, mathematically. You agree? Yes. Yeah. It's a lot, and I hate that they went way up on you, but basically what you're buying is a quarter million dollars worth of coverage on average for $4,100 a year at 75 years old, the likelihood you use this.

Now, you may stay two months, and it's a losing proposition. You might die in a car wreck, and it's a losing proposition. You might stay six years and make money on them. I don't know. But, I mean, we don't know. That's how this stuff works, right? So do you, you know, all insurance is a bit of a an educated bet if you're if you're smart about it and what we're betting is 4100 against

the probability of an average of 250 000 yeah i feel for me listening to this it feels risky to let the coverage go and follow the stat of the 2.5 years. Because if he's in there longer and he runs out of money, he's up a creek without a paddle. Well, and I guess if you're going to leave it to your brother, you might as well use it yourself. It's how you want to look at it. How concerned are you about that half a million dollars surviving you?

Yeah. That's what it comes down to. That's true. And so, you know, do you want to burn through it? I'm kind of thinking I'm going to pay for it myself and self-insure. Here's the other thing, Doyle. You may want to investigate as a part of this decision. Either one's okay with me, but that's your trade-off. It's $4,100 for a probability or a possibility of an average of a quarter million.

That's your trade-off. And, you know, that sounds like a good trade when you say it that way. Yeah. Now, the other thing is this, though. If you were to do, let's say, okay, I'm going to allocate, I'm going to designate someone to take care of my money if I'm incapacitated and I'm going to designate them to hire

and provide me with 24 hour a day in home care and hire a full time nurse. Now that. And you probably can do that cheaper than a nursing home. And you might enjoy it more. Maybe. I would think so. You're in your own more well maybe i would think so you're in you're in your own home depends i mean you know you're by yourself too but i mean but but uh

so that's you know like in my case i'm more than able to self-insure i'm 63 i do not have long-term care insurance i've got but you can pay substantial net worth and if something happens and i'm homebound sharon i was going to hire somebody full-time we've already got that arranged i'll hire somebody full-time something happens to her uh because we're just going to do it because we want to be there yeah in that case and so uh i mean you you can buy a hospital bed you can hire a full-time nurse an rn i mean it just it's not that expensive it's not as expensive and make your own food and that kind of stuff oh yeah so that that's not that expensive it's not as expensive and make your own food and that kind of stuff oh yeah so that that's the that's the provision you're not having to provide

shelter because you've already got the shelter and that that's the issue so that that's always an option for especially if you're choosing to self-insure yeah i would look into it uh i moved here from south florida and south florida is like the retirement capital of the world and that's what everybody did. Everybody would hire a live-in nurse and have 24-hour care. Yes, that is far more popular than going to a nursing home or going to a facility, is you have somebody move in with you and take 24-hour care of you. You do need to – don't cheap out.

Don't go eight-hour care, 24-hour. Well, yeah. I mean, make sure you're taken care of, right? Don't cheap, because you're saving money anyway, so don't cheap out. Yeah, yeah. And you've got this great income from the pensions of $85,000 a year. Yeah, he's got some options. I'm going to be real tempted to self-insure, partly because I'm kind of with you, Doyle.

It pisses me off they went up that much. But it probably is based in math. I mean, it's probably based in a 75-year-old higher probability, right? That's true. That's true. That's how they're getting there. Chris is in Wilmington, North Carolina. Hi, Chris.

Welcome to the Ramsey Show. Hey, how you doing, Dave? Better than we deserve. What's up? Hey, so I'm a recent graduate of college. Now I just got a full-time job and I'm working. Good. And I'm really looking forward to stopping to have to pay rental income or pay rent because, you know, it's just money down the drain, never getting back.

So I'm really looking for a plan or something to do to set myself up so I can hopefully get out of the situation in the near future, near future as in five years, to be able to buy a home. Do you have a job? Yes, I do. I have a full-time job. What are you earning? During the week, 55k. Okay. Is this what you want to be doing long-term or is this kind of a transitional deal? Yeah, so this is my career job. It's in my field I went to school for. Cool. And then I also have part-time 1099 income that I do on the weekends from March to November at the Baseball Empire. It's pretty steady.

And is that on top of the $55,000 or is that included? Correct. No, that's on top. All right. You got any debt, Chris? I got $20,000 doing that. You got any debt?

Any debt? I have student loan debt. How much? About $20,000. Okay. Your first goal is roll up your sleeves and get rid of that as fast as you possibly can.

And then you build an emergency fund of three to six months of expenses. By the way, I want that done by Christmas. I want you debt-free by Christmas. You're 55. You're single. You've got nothing to do with that money but party or get out of debt. So get out of debt. Yes.

That's all you got. That's your two choices, okay? Get out of debt. That's your only job. Get rid of sally may evict the old woman she's ugly you don't want her in the spare bedroom and if you don't do it if you have car debt because i'm just you didn't say it but if you have a car debt pay that off too because that counts 100 debt free then build your emergency fund of three to six months of expenses

then save you a good down payment as 20% is best because you avoid PMI, private mortgage insurance, when you put 20% down on a conventional loan. That's your best bet. You can do all of that by the time you're 25 in your situation. Everything you're wanting to do there is very, very possible, but do it in that order, and that's the fastest way. This is The Ramsey Show. Jade Warshaw, Ramsey Personality, is my co-host today as we answer your questions about life and money. Brett is with us in Provo, Utah. Hi, Brett. Welcome to The Ramsey Show.

Thanks, Dave. Thanks for having me on. Sure. What's up? So me and my family, we have been renting for the last year while paying off student loans. We paid off $115,000 of student loans. Way to go. That's awesome. Yeah. Thank you.

Yeah, so we're at a point now where we're looking to save up for a down payment on a house. And the house we would be looking to buy, it would take us about three years to get a down payment for that house. But we're wondering if maybe it might just be smarter to wait another three years, so a total of six years to pay for a house in cash. How much of a down payment are you doing in three years? 50%? Yeah, it's pretty much close to that. Yeah, houses are pretty crazy. How did you determine 50% as a down payment?

Just for the house we were looking at for $800,000. You said you can do 50% of the house price in three years. Right. Yes. $400,000. Yeah, I guess $350,000 is what I was looking at. Yeah. Okay.

And what do you make? $260,000. Way to go. Good for you. How old are you, Gus? I'm 32, and my wife is 29. Okay. Well, this is one of the, maybe the only answer that I ever give here on the air that is not what I would do, but what is okay to do. Okay.

What I do, the way I live my life for the last 30 plus years now since I went broke is I don't borrow money, period, for anything ever. And so I have to figure out a way to cash flow it because there is nothing that I want badly enough or that I'm scared enough of to go in debt for it. I have been there, done that. I didn't like the T-shirt. I'm not doing it anymore

okay uh i truly do believe that the bible is telling the truth that the borrower is slave to the lender and i truly don't borrow money and i do believe that that is the shortest path to wealth by the way okay yes, the starting few years is rough. Um, but the, the ending years are amazing. So, uh, uh, uh, now having said all of that, then it's the only advice we give here on the air that I don't personally follow. And that is if you take out a mortgage with a good, strong down payment, 50% is more than a good, strong, a good, strong down payment 50 is more than a good strong a good strong down payment would be 10 or 15 or something like that 20 would avoid pmi that's good and your payment on a 15 year fix is no more than a fourth of your take-home pay if you did that in your case

you could then pay that house off within six years right right and if you could pay cash for it in six years you could pay it off in six years and obviously anyone who pays their home off in six years is way weird compared to the culture so you're you're weird no matter where we are on this spectrum yeah and you're and you're heading in the in the you know your your face is under the column of smart people no matter what we do on this spectrum that's right so either one of those is fine so it's just a matter of so someone call me a legalist some would call me a purist uh someone just call me not a hypocrite but um but that i don't borrow so you can do either by ramsey guidelines anywhere in between those two things and be there. So you could put down 50 percent.

You could put down 80 percent. You could put down 20 percent on a 15-year fixed where the payment's no more than a fourth-year take-home pay. And it wouldn't be in this case. And then turn and pay it off as fast as you can. All of that is within our guidelines because we know that that's going to lead you to wealth. Brett, how old are you? I'm 32. Way to go, man.

Way to go. What do you do for a living? So I'm a nurse anesthetist. Ah, good. Very good. You're killing it, man. So proud of you. And that was where I was kind of having the question between the two just because is there

any measure on if it's harder for kids to move when they're older? That was kind of what we were going between two. I mean, I wouldn't want to wait. I wouldn't want to move in high school if that's what you're asking. I think that kids are very resilient. I think that by the time they, you know, once they put down roots, if you get into those high school years, it can be a little bit tough. i mean you can recover from anything but yeah when they're how you have you've got kids now how so the oldest is seven so seven five and three seven they're all right he would be 13 you know if we waited the full six years to pay well that's also assuming you get absolutely no increases in income right right yeah i yeah true it's a good point which is weird because

when i start saving towards something that i want really bad what i'll do is work my butt off and my income goes up and you know i'm able to just attack it and so my guess is that it won't take you as long as the math on a straight line without any increases in pay says, okay, that you should have because your intensity will go up and your income will probably go up both during this time. So it'll probably be four or five years. But same thing's true of paying the house off. Yeah, yeah. If you bought it and we're living in it. So we're not going to yell at you for either one um uh i just love the options that you're looking at i love that you're calling in here talking about 50 down or 100 down that's a wonderful quandary to be in you got options you got your head in the right place that's for sure

and so again i truly do believe these principles. And so I truly believe that if I live them, I'm going to be the safest in the event of a pandemic. I'm sitting in a building that's worth, I don't know, what's this thing worth now? Three or four hundred million dollars. And it's paid for. And it's paid for. And so nobody, I didn't have to worry during the pandemic that we couldn't make the payments here. Yeah.

Okay. That allows this bald head to lay on a pillow and sleep. You know, it just is a different world. Joe's in Greensboro, North Carolina. Hey, Joe, how are you? Hey, Dave. Hey, Dave. Hey, Dave.

How are you? I'm great. Thank you so much for taking my call. Um, a question is, I, I'm kind of, I own a business. My father just passed away, so we're still navigating the situation. I'm sorry. How long ago did he pass? Uh, New Year's. Sorry to hear that. And, oh, thank you. And it's, it's trying to get everything together and i can't slow down i'm you know got my foot to the pedal trying to get this business in the right direction still and recouping from losing him is a vital part of it but my main question is what we do have debt

for the company um i've been personally working on the baby steps for over a year now i'm like on baby step three because i got to attack my daughter's college because i neglected that for so long um so now i'm torn between do i focus on the business debt or focus on my debt you signed for the business debt it's all your debt legally it's all personal debt how much is it 605 605 000 yes okay what's the business making what's your income about 5.5 5.5 million dollars top line yes what are you netting? I couldn't tell you that off the top of my head. Okay, that's your next new job when you get off the phone is learn your numbers to run your business. Okay, you need to know what your numbers are. As an entree leader, I'm going to say small business to small business. You don't stay

open if you don't learn your numbers and stay on them. You need to know what you're making all the time. That needs to be like top of mind. It's not because you're money obsessed. It's because money is the scorecard that tells you the health of your business. It tells you whether you've got a disease inside there or not. Okay? So you've got to figure that out. What did you pay taxes on last year?

What was your income tax filing on? How much money? I think it was right at 4.8. Your personal income tax? Oh, personal, personal. I'm sorry, I was thinking about business. 100. Okay, your business did not make 4.8 million and you only personally made 100. Something's wrong with your equation. If you're making a profit of a million dollars a year, just pay them both off and shut up, okay? If you're making a profit of a million dollars a year, just pay them both off and shut up. Okay. If you're making a profit of a hundred thousand dollars a year, then you need to prioritize your debts at home and get rid of the small ones first.

And then we'll work on the 605. And that's the way it is. But you need to figure out what your money you've got to work with. You can't even tell us. That puts this hour of The Ramsey Show in the books.