The Ramsey Show - App - Helping Teens Build a Solid Foundation (Hour 2)

Episode Date: July 23, 2018

The show about you

🎵 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. You jump in, we'll talk about your life and your money. It is a free call at 888-825-5225. That's 888-825-5225. William is with us in Pittsburgh. Hey, William, welcome to the Dave Ramsey Show.

Hey, Dave, thanks for taking my call. Sure, what's up? I was calling. My wife and I have been working on the baby steps for about six months now and uh we're at a point where we're deciding on if we should sell our house uh to pay off some of our uh student loan debt do you like your house uh yeah it's not our forever home but no there's no such thing. Yeah.

No one lives in a home forever unless they're just resistant to change. Right. So how much debt do you have, not counting your home? Not counting the house, we have $74,000, which is all student loans. And how much equity do you have in your home? About $60,000. Okay, and what is your household income uh 90,000 okay all right so you've worked the debt snowball down to the one big debt and he kind of hit the wall emotionally right yeah yeah that makes sense well good job how

much have you paid off so far uh so far well we had like some money in our savings that we were able to pay along with a gift from a family member. So we were able to pay off probably about $18,000 so far. Okay. But how much of that was gift and savings? $5,000 was a gift and probably about, I want to say, $6,000 was from savings. Okay, that means you personally have cash flowed $7,000 in debt reduction. Yeah. In what period of time?

Like I said, about five or six months. Okay. And you make $90,000 a year? Yes. Okay. And you make $90,000 a year? Yes. Okay. Your house isn't a problem. Your lifestyle is a problem. People who make $90,000 a year doing a debt-free scream here on the air, if you listen to them, usually pay off to the tune of $30,000 to $50,000 a year is the rate at which they are reducing debt on average. Now, that means they're on a scorched-earth lifestyle, beans and rice, rice and beans, no vacations,

Christmas is a craft, and you don't see the inside of a restaurant unless you're working there. But you're getting out of debt. You have not been on that budget with $7,000 paid off in five months. No, not yet yet that's not the same rate of reduction so um you know what i would say is this moving is very expensive financially and emotionally and physically it's expensive um and so i would move as a last resort unless you just already hate your house. And if you hate your house and you want to move, you know, you just go rent for a little while or something. But I think instead what you guys have got to do is turn the screws up on this budget, turn the heat up on this budget.

And, you know, just take your life and say we want to be out of debt more than we want x or y or z for a short period of time because if you paid off thirty thousand dollars a year for two years you would be debt free but that's twenty five hundred dollars a month not eight hundred dollars a month so you need to turn it up by about 4x to get to that rate of reduction. But that would put you about the typical debt-free scream. Very few people, William, can wander out of debt. Most people have to get so personally angry about the debt or scared about the debt that they cut deeply into their former way of doing things. And then you change things.

So, hey, thank you for the call. Chloe is with us in Chicago. Hi, Chloe, how are you? Hi, Dave. I feel so privileged to speak to you today. Thanks for taking my call. My pleasure. How can I help?

I am a newbie. I have just been watching the Facebook Live podcast and listening and immersing myself in videos from YouTube. So I kind of stumbled across you by accident. Cool. And I can just say just by listening, it's just changing my life, just changing my mindset and everything. So anyway, my husband and I have decided to get on board. Good. And get our life back and change our family tree. Good for you. And we're going to start, we started, we saved

our thousand dollars already. And so we're now, I just put my debt into lowest to highest. And my question is, we were going to, we asked for help from a financial counselor through calling through one of your Dave Ramsey financial coaches. And I'm trying to find out if we should do a one-on-one with a financial coach or should we just go through Financial Peace University first? If they're one of our coaches, they will put you in Financial Peace University as part of the process. Okay.

Because one-on-one coaching is very, very valuable, but being stuck in with a group of people who have the same goals is more valuable. Okay. And so our coaches seldom will just do one-on-one coaching without it being attached to Financial Peace University. But I'll help you with that. I'm going to give you the class as a gift. Well, thank you.

I want you to get the one-year membership, and that includes every dollar plus, connecting to your bank on every dollar for a year. It includes the online access to all the lessons, as well as you can join a group there in Chicago to go to the nine lessons. And I want you to go to the nine lessons. And the only thing I ask is that someday when you're rich and famous and you've gotten out of your debt and all that, you find somebody that's a newbie and just getting started,

and you pay for them to go through someday. I sure will, absolutely. Okay. And if you need some help, you call me back as you're going through this. But you're the kind of people that Financial Peace University membership is made for. It's designed for people like you. That's what it is. So, you know, thank you.

Thanks for hanging out with us. And hang on, and Kelly will pick up, and we will get you signed up for that. By the way, it's a good thing to remind you guys that our Financial Peace University coordinators are the key that causes these groups in your city to work. And over 5 million people have been through classes, and all of those classes were coordinated by a volunteer coordinator in your area. That's pretty cool. You can go take the nine lessons there at a local church in your area or another location in your area, and you're walking along, as I told her, with people that are doing this stuff. So you're weird to the culture, but you're not weird in that class anymore

when you start cutting up your credit cards, living on a budget, and that kind of stuff. So here's what we're going to do. We have declared this week Financial Peace University Coordinator Appreciation Week. And if you want to lead a class for the first time, lead a group for the first time, this August or September, we're going to give you for free the $350-$400 Leadership Kit. Call the office at 877-378-2667 if that's you. 877-378-2667. A free leadership kit to lead your first Financial Peace University class this August or September. Are high health care costs getting you down?

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It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live, Bob and Charlotte are with us. Hey, guys. Hey, Dan. How are you?

Where do you guys live? We live in Auburn, California. Ah, very cool. Good to have you. Welcome to Nashville. And all the way over here to do a debt-free screen. We are. You bet.

Fun. And how much have you paid off? We paid off $101,000. I love it. How long did this take? 24 months. Very good. And your range of income during that time?

From $120,000 to $136,000. Cool. What do you guys do for a living? I'm a retired school administrator. I've been retired for a couple years. And I'm an assistant director of a before and after school program at our school. Oh, both educators. Very good. Good. For a couple years. And I'm an assistant director of a before and after school program at our school. Oh, both educators.

Very good. Good. And $101,000 of what kind of debt? It was credit card, $15,000, and second mortgage, and the first mortgage. Oh, you paid off your house. You bet. We did. Looking at weird people.

I love it. So what started this journey 24 months ago? We were making too much money and not having enough of it at the end of the month. And it just didn't make sense. We'd heard about you for quite some time. I bought the Total Money Makeover and listened to that. It was an audio book. And that's where we just took off from there. Charlotte and I both got on board. And, yeah, it was fantastic from that point on. We listened to the podcast daily and the whole bit. We had no hope. There was no hope of doing anything fun because there was no money at the end of the month.

It was just depressing. And now you don't have any payments in the world. Not a cent. In Sacramento, California area, you have a paid-for California house. We do. This is known as a big deal. It is a big deal. That's a big deal.

We're on acreage. It's on an acre. Wow, acreage. Yeah. I like that. Very fun. And I understand you guys are Financial Peace University coordinators. Yes.

In fact, Matt Manson is here today. He's our liaison with FPU. Cool. How many classes have you all led? So far, we've led two. We have another one starting in a couple of weeks. Very cool. Well, if you hadn't heard, this is Coordinator Appreciation Week.

So you came on the perfect week. Anna and Cody Monroe, you know them? Oh, yeah. Yeah. They said, Bob and Charlotte inspired us with their awesome debt-crushing journey. We wish them a wonderful debt-free retirement. They're weird people. Absolutely wonderfully weird.

Congratulations. They're sweet. And Aaron Schindler. Yeah. Ring a bell. Bob and Charlotte were great coordinators leading by example. They really helped my wife, Allie, and I stay on track, and they opened our eyes to the light at the end of the tunnel.

I'm extremely proud of them and the sacrifice they made to get all their debt paid off. They're truly an inspiration. Very cool. Way to go, guys. Thank you. So not only did you do this, you're lifting up families left and right all around you. Yes. An educator couldn't keep from doing that.

That's in the blood. It's just in both of your DNA. That's right. He opens the book and he's like, okay, now we're going to do this and we're going to do this. He's the nerd, and he's like, okay, now we're going to do this, and we're going to do this. He's the nerd. I'm not. Which means, by default, you are the...

That would be the one. How's it feel to not have a payment in the world? It's pretty phenomenal. It is. We took our first vacation in a long time last month, and it was a hoot. Went to Cozumel Diving. Oh, very nice. That's good diving. Yeah, a couple weeks there. Good drift dives there.

Yeah. Very good. Good for you guys. Congrats. Well, I'm very proud of you and thank you for leading Financial Peace University. What do you tell people the key to getting out of debt is? You paid off your house. The key is get on the same page with your partner and just make it

happen. We used every dollar and that was a blessing for us because we were able to track all of our spending, and it was just phenomenal. Our daughter is also, daughter and son-in-law are also involved in FPU, or excuse me, in becoming debt-free, and they're excited. In fact, our daughter at her university, she works at Azusa Pacific University. They're watching this class,

or they're watching this filming right now. Oh, fun. Yeah. Very fun. They're watching this live. Well, we've got a great relationship with Azusa. So very fun. And who's the young lady with you?

This is our granddaughter, Michaela. Ah. And when she came to visit us, I had my envelopes on the table, and we'd go to the store or whatever. And first I said, okay, I need to get my envelope. And so by the end of the visit, she was going, okay, Nana, get this, get your envelope. And, you know, so she kept me organized. There you go. And she said, you guys are going to go to Tennessee?

I've never been there. Can I go? Yep. You bet. I don't have a house payment. We can take the grandkid with us. This is very good. I like it.

Life is good. Congratulations, you guys. Got the mortgage. That's the mortgage balance he's showing there is zero. Zero. Very good. This is our deed of trust. Yeah, really.

What was the hardest thing for y'all? It was hard for me because it was 18 months before anything fell off. And so that's a long slog when you see nothing. About 16 months or so into it, I just had a meltdown. And I pitched a fit a two-year-old would be proud of and because my makeup was on sale but i went to the envelope and it was empty and so i was like this isn't fair i don't like dave ramsey i hate these envelopes and and i just went off and you were accustomed pretty soon um bob came up to me after i'd sort of calmed down and and he said in this really sweet gentle voice um sweetheart

are we gonna still do the envelopes i said yes i just had it to vent. And I vented, and fine, we're good. I'm not happy, but we're good. We're doing this. So, yes. And now you can buy whatever makeup you need. I can buy it all. Buy makeup like nobody else. Later, you can buy makeup like nobody else.

There you go. Very cool. Proud of you guys. We got a copy of Chris Hogan's retire-inspired book for you, number one bestseller. Thank you. That is the next chapter in your story to be millionaires and outrageously generous as you go along. You've already been overly generous leading all these classes.

Thank you for coordinating Financial Peace University. We really, really, really appreciate you. Very well done. Thank you. Bob and Charlotte from Sacramento, California, and the granddaughter, Michaela, with ears closed. There we go. Count it down. $101,000 paid off in 24 months, making $120,000 up to $136,000 debt-free.

House and everything. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! We're debt-free! I love it. I love it. I love it.

That is fun, fun stuff. Anthony O'Neill joins us at the bottom of the hour. If you've got questions about youth or you are youth and you're thinking about college, you're thinking about high school, you're in your millennial years and you've got questions, Anthony O'Neill will be with us at the bottom of the hour. The phone number is 888-825-5225. That's 888-825-5225. Now, think about this for a minute.

If you lived in Sacramento, California area, and you didn't even have debt on your house. Oh, wait a minute. Your grown son and daughter have also caught the bug, and they're getting out of debt. Oh, wait a minute. Your teenage granddaughter now knows how to work the envelope system. Oh, wait a minute. She also got to make the trip to Tennessee. So I wonder, she's 16.

When she's 66, 50 years from now, will she still be telling this story about this day when her grandparents changed their lives? Oh, by the way, changed their kids' lives. Oh, by the way, changed their grandkids' lives. I think that's called changing your family tree, isn't it? Oh, it's one thing to have a paid-for house on California. It's another thing to have a paid-for house, period, that makes you weird straight up. Oh, but it's a whole other thing to change your family

tree. Because what Rachel Cruz says in Smart Money, Smart Kids is absolutely true. When it comes to changing your family tree, math is part of the equation. But more is caught than taught. They're going to do what they see you do. I saw my grandmother with those envelopes. And it changed my life. I saw her do a debt-free scream. It changed my life. Hmm. She might select a different spouse just because of this visit to Tennessee. Hmm. Think about it. This is the Dave Ramsey Show. Can you believe this real estate market?

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Equal housing lender. 761 Old Hickory Boulevard, Brentwood, Tennessee, 37027. Ramsey Personality Youth Expert Anthony O'Neill joins us this half hour. If you're in college or high school and you have a question or you have a college age or a high school ager and you have a question, yell in. The phone number here is 888-825-5225. We'll try to open up some phone lines and make sure you can get through. 888-825-5225. And Anthony has got a lot of things going on. We just dropped a fresh YouTube video.

I guess it dropped in the last couple days about furnishing and decorating your dorm room. That was fun. Oh, yeah, it was real fun, Dave. You know, the team and I found out, Dave, that the average college student is going to spend about $900 going to college to take care of their dorm room. So we said, you know what, how about we put some education around it and make it fun. So we're going to give away $1,000 to individuals who subscribe to my YouTube channel to go out there and have a drawing. A drawing among them. Among the ones who subscribe.

I'm glad you said that. Not every one of them get $1,000. Yeah, not everyone. That was a good one. Clarify. Yeah, yeah. Sorry about that one, America. Some of y'all are hurt right now, but you'll be all right.

But yeah, so one person will walk away with $1,000 to be able to decorate their dorm room. Now, when is that drawing? That drawing is happening now until the 31st of this month. Oh, just next week? Yeah. So you've got one week to get your... If you subscribe to your YouTube channel, Anthony O'Neill on YouTube, you're in the drawing, and you'll draw out of that group of people sometime in the next week.

Yes, sir. We will announce it the next Friday. So I don't know what date that is, but a week after the 31st. Gotcha. So it's pretty fun. I mean, we're seeing a lot of great stuff. And we partnered with Target, Dave, and got to publicly say thank you, Target, for allowing us. They shut down the store for us, gave us some free stuff to even give away a little bit there.

And it's just great stuff so we even have a registry to where if you do not win we actually made a list of every single thing that a college student needs for their dorm for the first year of school that target does carry and how they get that list just go to my website anthonyoneal.com and then you click on a link you'll see a link says um going back to school list okay and you can see that and it's on the bottom of that video as well on youtube so it's real cool you know be able to give back to the young people and help them start off the first year it's pretty amazing dorm rooms i mean some of them are different but the majority of them are pretty much like a prison cell you know it's pretty much concrete block walls steel windows uh stuff that's bolted heavily into the wall yes and um so to make it a little more homey yes is a big deal huge deal i mean that's where

you'll be spending you know the next year some some of them for the next four years while they're in school but you know that's why i'll be partnering with mallory one of our team members here who's an interior designer she gave some creative ways to turn your ugly dorm room into an amazing beautiful uh dorm room for the season that you're in it very cool i like it especially the candles anthony right yeah you're big on candles we know that about you so uh you can go to anthonyoneal.com and get that list or if you're watching the youtube yes uh with you and mallory on it giving the suggestions it gives you the opportunity to link out of that yes yes sir okay sir and to qualify you have to be you have to subscribe to the youtube channel now people that are already you know and you need to be going to

college yes i mean if you're if you're 14 you don't get a thousand dollars for your dorm room correct yeah unless you're a child prodigy and you're going to college at 14 but anyway so it's people you know going into college your college student this coming fall yes then you qualify too because we want to give that's what the purpose of it is. It's not just to give away money. Yes, sir. We want to furnish a dorm room. And, you know, very cool.

That's very cool. Yes, sir. It's put, you know, it's very real stuff. I remember loading all three of ours into the dorm. Wow. And it was. It pretty much looked like a prison cell in there. And we did go buy the carpet that fit the room, that kind of stuff.

And, you know, people would sell it on the edge of campus sometimes and sometimes we buy it here it was cheaper if you bought it in town hold it hold it over there but um you know and you just think about what a little lamp will do or a little thing like you know and um you know just set stuff up have a little bit of personalization for a very sterile environment. Yes, sir. Very cool stuff. Good. That's fun. Graduate Survival Guide is Anthony's best-selling book that he and Rachel Cruz did together. It has a DVD in the back with he and Rachel giving you instructions for your graduate that's heading off to college. The Graduate Survival Guide, Five Mistakes You Can't Afford to Make in College. And, again, that book is a perennial bestseller because it makes a great gift for a graduate and is one of the reasons that people are all over Anthony. Now, Anthony speaks all over America in high schools and colleges.

He's gone almost every week to multiple cities. Where were you last? I just came back from Birmingham. I was in there, actually there, with Minimalist, a big organization that's traveling around the world, teaching people how to declutter stuff. So we did a live podcast there. Then I spoke in Atlanta to about 2,000 young people there.

Then I was in Dayton, Ohio, speaking to about 3,000 young people there. And then I'll leave again end of this week and be speaking to about 2,000, 3,000 more. Actually, college students for the Alpha Gamma Rho, their national conference. So those other big events, were they youth festivals or what? Yeah, these were, you know, it's the summertime. So there's a bunch of youth conferences, youth leadership conferences. The Minimalist was just a live podcast. Oh, yeah, they were wonderful. The Minimalist was just a live podcast. They're wonderful.

Huge documentary. Actually, Rachel will be with them on Wednesday or Thursday here in Nashville. Doing some great stuff. To be able to partner our two brands, that was huge. I love that. A lot of our folks, because they're having to, when I say scorched earth on the lifestyle, the Minimalist stuff fits perfect.

People are going, well, I need to do this anyway. It's a spiritual thing for me to just declutter my life. And that's good stuff. That documentary was huge. It was a big deal. Oh, it played a good role in my life, Dad, for me to declutter some stuff. I didn't go down too far in my house, but I decluttered. That's fun.

And another thing, for those of you, you know, we keep telling you that Ramsey personality, Anthony O'Neill, is a big deal in the youth space. And everybody comes to him as an expert. We do more research here on teens and have more numbers of teens that we're interfacing with, particularly on the financial side of things than anywhere else. And the White House has invited you, among a group of other leaders in the youth space, to come and have some input. What is the group? It's just a group of young, inspirational, influential millennials who will be coming out to the White House. Can't say the date or the time, but I'm excited to be among it, among those young people. Just go there, talk about everything dealing around student loans, life, spiritual perspective,

marketplace perspective, and just really talk to the White House, see what all they have going on, speak a word into them, and come back and get back to work. But just an honor to be able to go and represent you, this organization, and honestly, just have a good time. Yeah, absolutely. Well, it's a great experience for you. Yes, absolutely. Well, it's a great experience for you. Yes, sir. And a great verification that you have become a big deal in that space. Congratulations.

Very proud of you. I'm proud of you, too, Dave. Very well done. Me and Dave. Thanks. So I walked out at the commercial break last week, and a young man was standing there, 14 years old, at a dog walking business, and he was holding the new Teen Entrepreneur Toolbox in his hand. Yes, yes.

And that was the first one I had signed. Now, it doesn't have my name on it. It's got your name on it. You're the author of it, and you the the videos as a part of that instructing the eight steps to start a small business for young people and parents are buying the teen entrepreneur toolbox to lead them in this but that's pretty cool you're we've sold thousands and thousands of these things since it just came out the other day but it's gone done very very well because a lot of people want to teach their kids how to run a business. Absolutely.

You know, today I just did a YouTube video with a young lady who was actually in a teen entrepreneur toolbox, Mikhail, and she charged me. She not only makes shirts, Dave, she also does custom painting. And she charged me $350 for a custom painting of myself. And I almost had a small setback because I'm like, man, you're 14 years old and you made $350 in less than 24 hours. That is a you don't have high school students making that in a month at a part time job. Yeah. And she made that in less than one day and she loved it. She was passionate about it. And I'm like, wow, this is what teen entrepreneurship is all about.

Enjoying what you do, working from home, making good money. And she's saving all of it, Dave, to go to college. Very cool. The Teen Entrepreneur Toolbox. Back with your questions for Ramsey Personality. Anthony O'Neill at 888-825-5225. Guys, let's talk about that timeshare pitch that you fell for. They promised you exclusive access to travel anywhere you want.

Tropical beaches, mountain getaways, or whatever. Oh my gosh. They claimed it was the affordable way to travel, and then they convinced you it was a good investment. But here's the deal. Search any auction site for your exact timeshare and see what it's selling for. It's listed for a dollar with no bids. That's not a good investment. Now, I know I'm just adding salt to a very old wound,

but look, if you tried calling the resort and they won't take it back, if you tried selling it and no one will buy it, call Timeshare Exit Team. Timeshare Exit Team will get you out. You'll have to be patient. It can be a long process, and it costs money, but it works.

They're so confident in their exit service that if they don't get you out, you get a 100% refund. Call 844-999-EXIT. It's free to talk. 844-999-EXIT. TimeshareExitTeam.com. Ramsey Personality, Anthony O'Neill, joins us this half hour answering your questions. He is the co-author of the Graduate Survival Guide, Five Mistakes You Can't Afford to Make in College. He's among one of the top millennials out there speaking about money and speaking to millennials about money,

particularly student loan debt and other things, to the point that he's on a very short list of folks that is invited to visit the White House here coming up and ask some questions of the White House as to what they are doing about stuff like student loans and so on. So that'll be an interesting ride for you. Yes, sir. Looking forward to it. All right.

Anthony is with, another Anthony is with us in Ann Arbor, Michigan. Hi, Anthony. How can we help? Hi. Hi, Anthony. How can we help? Hi. Hi, guys. How are you? Good. What's up?

So I had a question. I am a current college student. I'm going to be a junior at U of M in Michigan. And I did take out a student loan. I'm in-state, though, so it's not too bad. But I'm working in the summers and trying my best to keep up with that. My main question is, though, I'm planning on doing graduate work, whether that be directly in my field or research or master's or something like that. What advice do you have for post-grads?

What is your field? My field is neuroscience. Neuroscience. Okay. uh post grads what is your field uh my field is neuroscience neuroscience okay and um what would be a master's in neuroscience what would you be doing i mean i understand if you had an md what neuroscience does but i don't know so research primarily so a phd you can go into behavioral neuroscience you can do research with that or you can Ph.D. in clinical work with more of a psychology end. So not necessarily as much of a master's, but I honestly am probably planning on a Ph.D. field. Gotcha. And what's your undergrad in?

Neuroscience as well? At Michigan, we have one called biopsychology, cognitionognition, and Neuroscience. So it's biology from psychology and neuroscience. Gotcha. Okay. You know, Anthony, I've got to say this. I really love your name. Thank you too, man. But you know, for me, I'm always about avoiding debt. So I don't have a problem with you getting an education. I don't have a problem with you going into the field you want to get into. What I would definitely say is figure out how to cash flow that next phase

because at all costs, I'm avoiding debt no matter what. So that means you may have to wait before you go to grad school so you can raise up the money, save up the money, get the scholarships to support it, maybe even get some future support in that area. But I'm avoiding the debt, Anthony. If there is a program with one of the local universities or a state university or whatever, even it could be somewhere else, I don't care, it could be out of state,

where you could go on as a graduate assistant and be employed by the university, and even if you didn't make a lot of money in those cases that those programs are set up to then you have free tuition and so you make a little bit of money not much you might even have to work a second job beyond that while you're working on your phd while you're a phd candidate but you just serve the university as a GA, and then you come out with your grad school work done. That's how Chris Hogan got his master's, and he did that debt-free. He was a football player, and he followed his coach to a different location. His old coach took a new coaching job, and he was the GA there on staff in the sports area while he got his MBA.

They paid for his MBA, and that was back when he was a youngster, of course. But that kind of a thing is a way to work on a Ph.D. like this without ending up with $150,000 in debt to get a Ph.D., which will just choke you down to nothing. And that's what you get there. So really good question, and here's what you get there. So, really good question. And here's the point. You're thinking about it.

Yeah. Sometimes people don't even think until they're the other side of it looking back and they go, oh my goodness. Yeah. I don't make a lot of money and I owe a lot of money. Yeah. From my field of study. And I have no idea what a PhD will make in that.

If you're doing research and you have a professorship i suspect you'd be in six figures but um but that doesn't that does not mean that you use that as a rationalization to go six figures in student loan debt to get that charles is with us in houston texas charles your question for anthony and me hey dave uh so next year i'm going to be going to college in New York City, and I will be debt-free with scholarships and some of my parents taking in money. Wow, great. I had a question about credit cards. So my dad is a fellow follower of you, and he introduced me to you last year,

but I kind of questioned his methods about he still has a credit card and he pays it off. He says, well, that's okay as long as you pay it off. And a lot of people say, you know, in order to live there, because I plan to live there after I complete college, assuming everything's all right. In order to live in New York, you have to go into debt? Well, they were telling me, like, you need to have credit to get a loan,

and I know that you're completely against that, so I just, like, want to know, like, what are the best ways while I'm in college and on a low budget to build either a credit or some way to be able to, you know, rent an apartment or get a loan of some sort? Hey, Charles, I think you already know that answer, man. We're not going to teach you how to build a credit score. We're not going to teach you how to get a loan. What we're going to do is teach you how to build a solid foundation for your future and save money.

So with you going into college, man, let me tell you right now, you do not need a credit card, nor do you need a credit score. I thought the very same thing, and I ended up $35,000 in debt, homeless in the back of my car, trying to live the American dream, trying to impress and have what everyone else has. But now I'm going to tell you, as a 34-year-old down to a young guy like yourself, get the credit card system out of your head. You do not need a credit card to rent an apartment. You do not need a credit card to be successful in New York and to live in New York. What you need is cash. And so I'm going to tell you to set aside $500 minimum to $1,000 in your emergency fund. And then right now, your number one focus is college.

You know, get through college debt free. Never borrow a dime. In regards to your debt, having a credit card and paying it off, that's not the route that you want to go. Because as a young person, that's not the route you want to go. So here's the thing, Charles. You can rent an apartment without a credit score. You can buy a house without a credit score. Because all a credit score says is that you borrowed money and you paid it back.

That's what the credit score says. And so the only thing the credit score says is that I used debt so that later I can use debt, so that later I can use debt, so that later I can use debt. And you get caught in a vicious cycle of a dog chasing its tail, and you end up working your whole life broke, and all the money you make goes to the bank so here's the thing will all apartments rent to you without a credit score no they won't and usually it's the more corporate type ones that won't but if you say i am a hundred percent debt free here is my income here's the money i have in savings people who are allowed to use common sense when assessing a tenant

would actually like a tenant. Think about it, Charles. Would you rather have a tenant that has a bunch of payments or a tenant that is debt-free with money in the bank? They're more likely to pay their rent if they're debt-free with money in the bank. Does that make sense? Yeah. So you'd have to find a common sense landlord.

But there are apartments within two miles of where I'm sitting right now that will not rent to you without a credit score. So here's what that says. I don't have a credit score. I haven't in 20 years. I'm a multimillionaire. So I go down to rent an apartment. They will not rent me an apartment. I can write a check and buy the whole complex, but they won't rent me an apartment.

And so I just have to go. That's part of my life. I'm not going to go into debt to keep idiots like that happy. And so I'm going to find a landlord that has common sense like me. I have a bunch of rental property, and I will rent to someone without a credit score, not just on principle because I teach it, but because common sense says they'll actually have money if they don't have payments. And they can pay my rent as a tenant, which is my goal as a landlord.

And so that's what you're looking at. And as far as getting a home, that's much, much later. And if you have to have a credit card to exist in New York City, what that says is you don't make enough money to live in New York City. And you're getting ready to go into credit card debt. That would be dumber than a rock. Don't do that. Don't do it. So, hope we covered it for you, Bernie.

Thank you for calling in. Anthony O'Neill, thanks for stopping by. Ramsey Personality. Be sure and check out the new drop on YouTube. And those of you that are moving into a dorm, we're giving away $1,000 to decorate your dorm. Go to anthonyoneill.com and register or be a subscriber on YouTube at Anthony O'Neill. Thanks for stopping by. Thank you, Dave.

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