The Ramsey Show - App - Hope and Help for Your Financial Future (Hour 2)

Episode Date: June 1, 2018

The show about you

Live from the headquarters of Ramsey Solutions, this is the Dave Ramsey Show, where America is hanging out to have a conversation about your life and your money. Honored to be sitting in for Dave Ramsey this hour. I'm Ken Coleman, host of The Ken Coleman Show on SiriusXM. It leads in to the Dave Ramsey Show every day on Sirius XM Channel 132. And I'm joined in studio by my pal Ramsey's personality and best-selling co-author of The Graduate Survival Guide.

He is Anthony O'Neill, and we're here to take your calls. 888-825-5225. 888-825-5225. So we open it up. So if you've got a question about the young person in your life, the student, that is Anthony's specialty, he can answer your money questions as well. And if you've got a question about your career,

you're feeling stuck, confused, scared, that is my area of expertise, and we are here to serve you. It is your show, and we are here for you. The phone number, 888-825-5225. That's 888-825-5225. We've got a great audience out there in the lobby of Ramsey Solutions looking in to the studio. A little newborn out there waving at us.

She's a doll baby. Anthony O'Neill, how are you, sir? Ken Coleman. I'm doing good, sir. You've been traveling all over the place. This is always the case with you. I see you in the office only when you're returning from a speaking gig somewhere in America helping the next generation. What's been the latest couple of things you've been doing?

Just got back from speaking to the Baltimore Ravens rookies just the other day. They signed 30 rookies. Not all 30 of them will make the team, clearly, but a good 13 of them will. And it was just a great opportunity to sit down and talk with these young guys about money, about decisions, about building a solid foundation for their life.

So just partnering with the Baltimore Ravens, that great organization there. I'll be going back out there in September just to really follow up with the 13 that did make the team. And we're going to really just come up with a solid plan. Plan for their life. Plan for the money. Make sure that both of those are working together and they're being

successful at a young age. This is fascinating even for people who are listening right now who aren't football fans. You think about a professional athlete who they go from being a college athlete. All of a sudden some of these are star rookies yes they're going to make the team yes some of them are fighting yeah with everything they've got to reach the dream and on top of all this some of them don't have many of them don't have a good

financial background that's why you're there really curious when you're in there sharing dave's principles and and the way you share it and what you've learned, how do they receive you? Oh, man, they were hungry. Kim, when I say they were hungry, they were hungry. I've never been around a bunch of athletes, celebrities. They take out their phone, they hit the record button and come drop it on the stage where I'm speaking. Really?

Because they want to make sure that they get all of the information. So that way, when I leave leave they can go back to it so i'm just i'm i'm just excited to see this younger generation is hungry to really move forward into their future with a solid foundation that they can build on and not worry about their past with debt with issues that they have going on so great organization and even like tonight can i'm going down to huntsville alabama to around 600 young millennials, young leaders who are hungry about this life. How do I take control of my money and let my money take control of me? I'm just excited to be down there.

It does not matter, folks, whether you are a young professional athlete or you are a middle-aged person. Sound financial principles work no matter where you're at. Great stuff, Anthony O'Neill. 888-825-5225. That's the number to jump in. 888-825-5225. We start off with Ari, who's on the line in New York City. How can we help?

Hey, yeah. Thanks for taking my call. Sure. I'm about $115,000 in debt. I've gone through FPU. I'm on Baby Step 2, obviously, paying down my debt. And I live in New York City, so I'm kind of – I'm bound here because I'm divorced, and my daughter lives here, and I want to stay here.

But my net income – I'm sorry, my rent-to-net income ratio is about 50%. So obviously I know that that has to get cut down if I'm really going to pay down my debt. I've thought about roommates, proposed it to my ex-wife, and she has already threatened to take me to court if I do that. So I'm kind of like, what do I do? I'm bound to this area, and it's very expensive to live here. I know that there could be some savings, but I would love some advice. Yeah.

All right. That's a good question, man. And I'm going to – first off, you said your debt-to-income ratio is about 50%. What is your gross – let's say your net. What is your net yearly income? Net is – I'm sorry. It's about $38,000. Okay.

$38K. And you're $115,000 worth of debt, and you're living in New York City. That's correct. Okay. All right, you need to move out of New York City. That's going to be the very first thing, and I hate to put it like that because you don't have to leave the New York area, but you need to step outside of the city so you can bring down your housing a little bit cheaper.

One thing, what I'm hearing from you is you have your daughter. But then if you get a roommate, you're going to lose the possibility of having your daughter at your house, which I would totally understand as a mother. I don't want my daughter around another man. And so what I want to recommend to you to do is to do what you have to do right now, which is one, continue on baby step number two, change your living situation. Get outside of the city. Go out into the, I don't know where you can go, but get outside of New York City because

I know that's expensive. And then three, we need to look at getting your $38,000 a year up. And that's, Ken, you can speak on to that end as far as in how to get that shovel up. Ari, are you in Manhattan? Tell me where you're at. No, no, I live in Queens. All right, where does your daughter live? Brooklyn.

All right, where do you work? The Bronx. Gotcha. So, you know, I'm familiar with the boroughs. I think Anthony is absolutely right. You can ride a train in to see your daughter. Absolutely. But have you done any specific research on how much you can save on your rent by getting out of the five boroughs?

Have you looked into that? I have. I looked into a couple of different things. I think it would be at the minimum $300 a month, so that's $3,600 a year. And then it would also save me 3% on income tax. Yeah, so what are you waiting on? Because you're not just getting outside. That's a train ride.

I've got a lot of friends who live outside of the boroughs who work in Manhattan, and that's not that big of a sacrifice. It's not going to keep you from seeing your daughter, and automatically what Anthony has said there saves you big money. Now, the other thing I would say is I think that you are going to have to get really serious about a second job, a side hustle, to start making more progress quicker. But making the move, my goodness, I'd be looking at, if I had to take an hour

train ride, and if it saved me $600 a month, $7,200 a year, I think you're trying to slash, slash, slash, living in something that you would never dream of living in, except for the fact that it needs to be safe, because your daughter's going to be with you some of the time. But it doesn't have to be fancy, it just needs to be safe because your daughter's going to move with you some other time.

But it doesn't have to be fancy. It just needs to be clean and safe. And I think that's what you're looking for. A step back is not a big problem. A step back is a good way to actually move forward. Okay? Because you're going to step back. You're going to save money.

You're going to get out of debt. Once you get out of debt, you're going to be able to move back into something now because now you can afford it because you have 100% of your money. So, hey, listen, Ari, we love you. We appreciate you for calling in. Move out this weekend. Yeah. Well, we do want you to be responsible as a renter, but you know what to do.

Hey, coming up, Anthony O'Neill and myself, Ken Coleman here on the Dave Ramsey Show hosting this hour. We're going to be taking your questions about life, money, career, whatever. And, Anthony, I'm excited. I'm going to tease this. When we come back, I'm going to tell you about a new resource we've got out from me and our team to help you flip your resume, to fix your resume, so that you can land the dream job. How about that for a Friday tease?

America, do not miss this. Don't move. More of the Dave Ramsey Show right around the corner. Okay, I need you to listen to this. Because one normal routine that everyone does can cause total chaos in your life. I'm talking about the simple act of using Wi-Fi. When you're on Wi-Fi anywhere in public or at home, you're at risk of hackers easily seeing every site you visit and every search you're doing online. It doesn't matter if you're on your cell or your laptop. They can see you visiting websites, streaming or downloading,

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Download Hotspot Shield by Anchor Free today. Welcome back, America. This is the Dave Ramsey Show, where America hangs out to talk about your life and your money. I'm Ken Coleman, joined by Anthony O'Neill as we sit in for Dave Ramsey this hour. 888-825-5225. That's 888-825-5225. What's your question about? You got a money question? You got a money question?

You got a career question? You got a question about your student, the millennial in your life, or the millennial that you may be leading? We are here for you. 888-825-5225. We go to Sharon, who's on the line in Jackson, Michigan. Sharon, how can we help? Hi.

I have a question that has to do with inequality between your kids. Like my daughter, when she graduated from high school, she had about $24,000 in her college fund. And that was just before 2008. And the crash came and it wiped out like 50% of her funds. So she went dry quickly, and she did end up with a $10,000 student loan. Ten, 11 years later, she still has this $10,000 loan. Now my son, who's graduating right now, he's got about $48,000 in his college fund, and I feel obligated or I feel like I want to. I don't know how I feel, really. I'm a little torn there on what I should do about the inequality.

Should I take from his fund to give her money? Well, no, no, no, Sharon. Let me stop you right there i want i don't want you to take funds from your son um well what i do want to do is just step back and just relieve your distress you don't have to feel burdened about what your daughter had to do to go to school okay because here's the thing your daughter has to take ownership of her life and she did at that time now as a parent you have the choice you can say i'm going to help you i do not believe you need to do all of it she needs to take ownership and if you want

to help there's no problem helping but do not take away from your son because that's going to pay for all of his school right now if he stays in state if he goes to a community college or if he just stays in state at a regular four-year university, he's going to school 100% debt-free. So, Sharon, step back a little bit. You're okay. You did a great job raising two kids. Now, just go have a conversation with your daughter and say, hey, what can you do? And here's what I can do.

And that's a starting map right there. Yeah, I think that is really the key issue there is feeling, you know, you're the mom. Yeah. And you don't want to see one have more than the other. But is feeling, you know, you're the mom. Yeah. You don't want to see one have more than the other, but the reality is that that's great advice, Anthony. I love that. You just got to let them fly. Let them fly. 888-825-5225.

888-825-5225 is the number to jump in on the conversation. Next is Chris in Lafayette, Louisiana. Chris, how can we help? Yes, Anthony, question. conversation next is chris in lafayette louisiana chris how can we help yes anthony question um i have a daughter that's going to be a junior next year in high school and she is wanting to go to a beta beauty school and when she graduates and i was curious about um scholarships okay cool so that's a trade school right uh yes i guess we count as a trade school, right? Yes, I guess we'd count that as a trade school. Yes, sir. Yeah, yeah, yeah. Yeah, there's no problem. The very first thing is I would recommend that you get her on myscholly.com.

M-Y-S-C-H-O-L-L-Y.com. It's an app. I mean, it's $2.99 a month, but they do have a limited. Now, they are for four-year universities, but they do have a limited scholarships, a small number of scholarships that are available to help them to pay for trade schools, beauty school, barber school, stuff like that. And another website that I really want you,

not a website, but a book is called the My Scholarship, the Ultimate Scholarship Book in 2018. You get that book. Now they have several, several scholarships available right there. But the fact that your daughter, Chris, is going to a trade school, a beauty school, I commend her for that. Because Ken and I, you and I talk about this all the time.

You don't have to go to a four-year university. As long as you're getting some kind of education to further your future, you're making a good move. Yeah, because, you know, we look at education traditionally in this country as the four-year school, and that comes from a lot of peer pressure, and there's been a lot of cultural things kind of driving parents that way, and we put that pressure on our kids, and they automatically grow up that way, and they think, okay, that's what I've got to do to have a shot at success. But the reality is education doesn't mean four-year school.

Education means do you have the skills, the knowledge to be able to do what you want to do? I want to add to this, Anthony, that one thing that kids can do like Chris's daughter, certainly if you're going to cosmetology or beauty school or cutting hair or whatever, there are a lot of companies that specifically in the area where you're doing cosmetology, makeup, hair, the whole nine yards, where you can get on with a company and you're getting paid from day one, and then you're getting your education as you work. I've seen a lot of beauty schools. I don't know if that's what you call them.

It's not my area of expertise, beauty schools. But the bottom line is you can work and you get in at an entry level and you're cutting hair. Maybe you're washing hair. You're doing some of the coloring, whatever. But they actually educate you and you move up within the company as you're working for them. That's another great opportunity specifically in this trade. I love that call. And I think that's another resource that you need to think about.

888-825-5225. Up next is Nicole in Oakland, California. Nicole, how can we help? Hi. I am Nicole. I'm 32 in Oakland, and my question is whether I should buy a home. So one thing I do, I believe in, is I tie it off my growth salary at church. I have about a $150K base salary plus $30K bonus, of course, before taxes.

I have about $160K, $401K, $25K IRA. All my contributions are Roth. This year will be our first year. I'll be a bit maxed. I have no debt. So my savings is about $125K. The reason why I'm figuring out whether I should buy a home or questioning whether I should buy a home or not is because, of course, the Bay Area just keeps rising and rising. And a 20% down payment, 15-year mortgage just seems really tough.

I'm in a rent-controlled apartment now. And when I just do the numbers, I feel stretched even trying to find a house above $400,000 in the Bay Area. On top of that, I am going to be getting married at the end of the year. The person is coming from another country. His degree won't transfer, so he'll likely be doing community college starting off. But that's where I am. So when I do the numbers, I feel like if I try to do anything like above a $400,000 house in the Bay Area, the neighborhood doesn doesn't feel safe and then it just

feels like i'm stretched yeah yeah yeah i understand uh i totally understand nicole nicole i'm from san diego california so i i know i know but i know a little bit about the bay area um this will be my suggestion to you nicole i will pause i will pause on buying a house one thing is because you just said you're going to be getting married here soon and And so what I want you to do is get married, get into your relationship, get into your marriage, spend the first year just enjoying each other without the stress of a mortgage and learn what your husband may want in his house. Well, we all know you're the woman, so it's really going to go towards you. all can grow together for that first year, save some more money and see where your life is going. Cause you may end up moving depending on his education or his job experience or life may just happen. But if you guys are there in Oakland, California, after a year of marriage, a year or two of marriage, and you, you both agree that, Hey, we're going to buy a house.

Your income just went up because now you're married and now you can afford more of a house. But Hey, I want you to stick with it. 20% down. And the key thing is if you could find a lender that will get it to avoid your PMI, that's the key thing that we really want you to avoid is that PMI. That's right. And she can get there. Yeah.

She's already made terrific progress. It's just a much bigger mountain. But absolutely stay with it. I love that advice. I think all young couples, unless they're in a position where they can right out of the gate buy the house the way Dave would tell them to buy it, I love the idea of renting

and just figuring out where we want to end up. Such an important decision. Alright, Anthony, I told these folks before as we ended our last segment that I had an announcement. I'm very excited. The Ken Coleman Show team's been working hard to help people land that dream job. I'm a little jealous, y'all.

You ready? We've got a brand new resource at KenColemanShow.com. It's absolutely free. Here's the deal. What if I gave you five ways to fix your resume? Five ways to fix your resume so that you can land a dream job. It's all about who you know. Yes.

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And more exciting stuff coming from Anthony O'Neill. We'll tell you more about that a little bit later. 888-825-5225. That's the number to jump in on the Dave Ramsey Show. More coming right after this break. 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.

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Brentwood, Tennessee 37027. This is the Dave Ramsey Show. In America, you're welcome to call in. 888-825-5225. We talk about your life and your money. I'm Ken Coleman. Honored to be sitting in for Dave this hour and joined by my good pal Anthony O'Neill as we take your questions.

888-825-5225. We go to Bridget who's on the line in Kansas City, Missouri. Bridget, how can we help? Well, Ken, my question is really for my husband. He started a side business about two years ago, and we're just wondering what kind of goals we need to be setting before he can just venture off and not do side hustle and just make it his hustle. Ah, got it. How much does he make in his current job that is not the side hustle? About $60,000 a year. Okay. And how much is he making his current job that is not the side hustle? About $60,000 a year.

Okay. And how much is he bringing in through the side hustle? This year, it looks like we're already almost at $20,000. Okay. And so if you had to take a moderate guess, what do you think you'll be at at the end of the year? He will probably be close to $35,000, maybe $40,000 by the end of the year? He will probably be close to 35, maybe 40 by the end of the year. That's pretty good. And how long has he been at it?

Two years. Yeah. Well, the answer to the question is, from my opinion, is the step into the side business when it becomes the full-time gig is when you are financially able to do so. So there's a couple ways to look at that. I think the easiest one, you can see where I'm leading you, the easiest one to look at is when he can replace the $60,000 that he's currently making in his full-time job.

That's a no-brainer, Anthony. That's just a nice little easy sidestep. If he wants to get there sooner, you can do so, but that's depending on what other financial support you have. So, for instance, if, let's say, next year he projects and feels like he's going to bring in $50,000, let's just say that. That's what he will pay himself after all expenses. And so there's a $10,000 gap there, Anthony, from the $60,000 that he's been making. I'm okay jumping into that full-time if you've prepared for that.

So if you've got that emergency fund where it needs to be, and you have sacrificed and saved and readjusted the budget so that when you move to the $50,000, even though it's a numerical step back, there's not a real change in the way you live. And I think if you get to that place, Bridget, that's when it's okay to step in there. But you just don't want to put undue pressure, financial pressure,

which creates all kinds of other pressures, you don't want to put that on yourself as you're moving into this labor of love, which is owning your own business. There's enough stress as it is, Anthony, when you launch into your own thing. You just don't want to have to deal with the money concerns. You really don't.

And one thing I would recommend, Bridget, as well, is on top of what Ken is saying, I want to make sure that you're out of debt first. Because I don't want you to start your own business because we know when you're in business, your income fluctuates. And so your debt doesn't fluctuate. So what I want you to do before, that's the number one goal before you really jump out there full time, get through baby step number two, get through baby step number three, then I'm comfortable with you stepping out. But I would say this,

once you hit, let's say 60 is his guaranteed money this year, hit that two years in a row. That's what I would suggest on top of that as well with Ken. So that way you know for sure we can make the money, we're not in debt, we have a foundation, and we can go out there and just really grow. 888-825-5225 is the number to jump in. Here on the Dave Ramsey Show, I'm Ken Coleman, joined by Anthony O'Neill this hour. And next we go to Kira, who's on the line in Dallas, Texas.

How can we help? Hi there. So I've got a question. My husband and I have been working hard on baby step two for about a year and a half. I went in for a 30-minute just routine procedure and basically nearly died, had complications in there, sepsis, just a ton of unexpected things happened. And so now, you know, we're faced with about $3,000 in medical bills so far. They're still coming in. And I'm really struggling with feeling responsible. I certainly don't mean to feel entitled, but feeling responsible because I still won't have any answers directly on what

really happened in the operating room. And I'm just looking for advice. I'm trying to shove this into my baby steps, and I'm really angry that it's in my baby steps. And just looking for advice. You know, Kyra, I just want to, it's just an honor to be speaking to you today. Thank you so much for calling in. You're saying that you're only facing a total of $3,000 from the medical bills? That's it as of right now? Yeah, it's $3,000 so far.

That's just kind of what has poured in so far. This just happened in April. I mean, I'm so glad to be alive and finally working again, but like I said, I'm struggling with adding this into my baby steps. Yeah. I'm going to say, Kyra, add it into your baby steps. And just do it small. And let's just say, for an example, something comes and they say,

you know what, we're going to sit here and we're going to take care of it. You'll get that on the back end. But go ahead and attack it. Line it up like the debt snowball, smallest payment to your largest, and just attack it that way. And if something comes up from the hospital or you get awarded some money for what happened in the room, then you'll get it on the back end. And this is a reimbursement and some money put towards your savings or some of your dreams. But honestly, the debt is not really my main concern right now. I'm just excited and honored that we're talking to you. You are alive. You're well. You sound amazing. But go ahead and add it in a little bit and just attack it the regular

debt snowball way. Up next is Samantha in Phoenix, Arizona. Samantha, how can we help? Hi. So I've got $9,000 in my savings account. I'm 20 years old, and I have finished my second year of college, but I've got two years of college left to go, and I am terrified to do anything with that $9,000 because if I don't make enough or don't get enough scholarships to cover the student tuition for the next two years, then I'm going to have to go into debt if that $9,000 is not readily available. Samantha, let me ask you this. How much is your tuition remaining over those two years? Without taking into account any type of scholarships or financial aid, it would be $28,000 over the course of the two years because tuition is roughly $14,000.

Okay. Cool. Okay, cool. Samantha, are you living in-state? I do have in-state tuition, but I am in my own apartment. I am not at home. Any particular reason why you're not at home? Because it's seven hours drive. That's a good one. That's a real good one.

All right, Samantha. So what is the clear question? How can we help you out today? It's should I be doing anything with that $9,000 in the savings account, or am I okay leaving it as a safety buffer? Okay. So this one thing we teach, we teach all college students to have the minimum

of $500 to $1,000 in their savings account for emergencies. And so then after that, any extra money that you have, I want you to put all of that towards your tuition. Okay?

Because I want you to avoid borrowing money. I want you to avoid credit cards. I want you to avoid debt, period. So I am okay with you taking out $7,000 to to eight thousand dollars and putting that towards your tuition now if you want to wait and see samantha if you can get some scholarships that's fine but whatever is left over that you cannot get scholarships for i want you to take

that money out and put it all towards your education why because the number one investment that you can make is not in the savings account, but it's into yourself. And so if you can create a solid foundation going into your future, man, you'll get that $8,000, $9,000 back here after you graduate college in the next two years, Ken. Yeah. Anthony O'Neill, you have done something really cool. This Teen Entrepreneur Toolbox, which by the way, I need to get, I don't know if you can pull some strings. Get me a free one for my 12-year-old, Ty. I'd like to see him make some money this summer. Yeah, he needs to make some money. This is a great resource.

Tell folks about this. If they haven't heard about the Teen Entrepreneur Toolbox. Yeah, the Teen Entrepreneur Toolbox kit is an amazing kit. We set out to sell 4,000 by July. We've already sold nearly 4,500 copies already. Within the first two weeks, we did about 1,500 copies. And this kit is just absolutely amazing. This is a kit that's going to teach

young people how to start a business, how to make money from home, and between middle school and high school age. And I'm telling you, America, this is something that you want to get your kids on because we have an app, we give them a profit potential tool, we give them some goal sheets, and we give them a pretty cool DVD with me on the inside.

It's just going to spur some great conversations, some ideas, and might set them on the path to being future millionaires. That's what I love about it. This is super practical stuff. How do they get it? Real quick. AnthonyO'Neill.com or DaveRamsey.com or Amazon.com. How about that?

More of your questions about your life and your money. 888-825-5225. This is your show. It is The Dave Ramsey Show. Did you know, statistically, when it comes to life insurance and protecting your family, that women are more likely to be uninsured or underinsured than men. This doesn't make any sense. Women make up half the workforce, contribute mightily to family incomes, and in many cases are the breadwinners and take care of their families 24 hours a day. This is one of the most overlooked areas when it

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It's your show. It's your call. It's a free call. We'd love to hear from you. We go next to Diane, who's on the line in San Diego, California. Diane, how can we help? Hi. Thank you so much for taking my phone call.

Sure. We're in baby step number two, my husband and I. We have a 22-month-old, and we're expecting our second any day now. So we have a condo, which we own, and we have about $170,000 in equity if we were to sell. We also have $103,000 in debt, including student loans and credit cards. Come this August, we will be done with all of our credit card debt, which was $26,000. So we've been really hitting it hard, and we will be done by march 2021 if we continue this with this past okay so what's your question should we sell our condo uh we are currently renting renting it out so that

we could afford to pay and we are living in an apartment one of our family members we are living in an apartment with one of our family members. We are paying rent here, which is less than our mortgage. I just want to know if that's financially smart or if we sell our condo today, we'd be done with debt, but we'd also not be homeowners. We do love our home. We love the location where it is, and we'd love to go back to it. But that's how we have the current plan, and I want to make sure it's a smart move, the one that we've done already. Yeah. Diane, what's your household income? $57,000. I stay at home mom and that's just my husband's income.

Okay, cool. So Diane, this is what I'm going to recommend. I'm going to go ahead and suggest you do two things. One is going ahead and stick with baby step number two. Now you have a baby and you have a baby on the way. You're $103,000 in debt. You have $170,000 in equity in a home that you're not living in. And you're saying it will be out of debt by 2021, making $57,000 a year. I'm selling the condo, Ken. Absolutely. I'm selling the condo.

I'm going to get out of debt. I'm going to put now about $67,000 back in the savings account. So now when I have a kid coming, I'm $67,000. That's a full baby step number three. Okay. Yeah, that's four in there. And you're living beautiful. You're young.

You're in a beautiful San Diego, California, completely debt free. Diane, I'm selling the condo. That's what I'm recommending because what you're doing, you're doing the baby steps right there. And the baby steps are proven, and that's what I recommend for her to do. Love that. We go next to William, who's on the line in Albuquerque, New Mexico. How can we help, William? Hi, guys.

How are you doing today? Good. How are you? I'm doing good. My question is today, should I move out of my parents' house? How old are you, William? I'm 19. Okay. Are you in school? Are you working? What's your situation? I'm currently at community college learning a trade. I want to become an electrician. Okay. Anthony O'Neill, this is right up your alley.

Yeah, yeah, yeah, yeah, yeah, yeah. William, what's the goal here? Are you in school? Are you planning on, if you're in trade school, that means you're in there for about a year, maybe two years. You plan on getting a job and going from there? Mm-hmm. I have about a year and a half left of community college. Then I will get my associate's degree in electrical trades. Cool. Well, William, I don't have a problem with you staying at home. Here's where I will have a problem.

If you're staying at home and you're not doing something to help out the home. Okay. So what I want you to do is get a job, part-time job while you're in school and sit down with mom and dad and say, hey, mom and dad, hey, I need to pay something because I'm a young man. And one day I'm going to have to step out on my own and pay my own bills. So I'm going to give you $500 a month. I'm going to give you $250 a month. You have to give them something because I want you to start taking ownership of your life right now. Now, do not stop going to school.

Get your education because that's important for what you want to do, especially around what you want to do because you're going to make some good money. But start becoming the young man right now. I love the path that William is on. Yes. A year and a half from now, he's making really good money as an electrician. Easy. Easy.

Hey, it's all good to stay at your home, buddy. That's great. Great, great, great, great. But why are you staying at home, Ken? He needs to make sure he's not accumulating any debt. Oh, absolutely. He's doing the baby steps. That's right. Now, if you're staying at home getting in debt, no, we've got a problem.

We need to have a conversation. I love what you had to say as a parent. I love that. He contributed around the house. Yes. That's a way to say, hey, thanks, Mom and Dad, for being a great nest for me to fly away from. Really good stuff. Love that.

Up next, we go to Edward, who's in Los Angeles, California. Edward, how can we help? Edward? And we lost Edward. We lost him. But that's okay. You know, you and I were talking about this recently. I had you on my show.

We were talking about a situation where, like young William, the trades right now are huge, huge opportunities. And I'm just going to say this for 10 seconds. Parents, if you've got a young man like William who feels like, hey, I want to go into trades, and he's going to go to community college while he's getting and taking those courses, or he goes to a trade school that will then get him into the trade, that is something that is very worthy. I just want to make a plug for that. That is a great path. All right, let's see if we've got Edward, who's on the line in Los Angeles.

Edward, how can we help? Well, yes. My wife and I, we were having a friendly discussion last night, and we were on the path to paying off some of the debts that we have, and we were in disagreement about which ones we should prioritize and pay off first. Go ahead. I'm sorry off first. Go ahead. I'm sorry, Eric. Go ahead and finish your statement.

Okay. Yeah, so we have an annual income before taxes of about $185,000. Well, I'm in the military. My wife is a nurse. We have about $64,000 in debt, $54,000 in a rental house, and another between $8,000 and $9,000 in her student loan. In total, we have about $52,000 saved. So we can cut a check today and pay off the house, which would free up a lot of cash flow, and turn around and knock out her student loan within the next month or two if we were to be disciplined.

So we just have to do disciplined. So, yeah. Yeah, yeah. I love it, Everett. You sound like a young couple making good money in the beautiful California. Man, I love California. But this is what I'm going to recommend. We teach a debt snowball here, okay? We teach you to go ahead and line up your debt from smallest to largest.

So, you said that you can get the check. You can cut a check today and pay off your house. No, what I want you to do is I want you to line up your debt from smallest to largest so you said you can you can get the check you can cut a check today and pay off your house no what i want you to do is i want you to line up your debt excluding your house right now and and pay off all the debt so this is your credit card student loans car loans um any loans okay and pay it off that way now once you pay that off okay before you pay off the house i want you to go ahead and set up three to six months of a living emergency fund. That's what we call it. Now, if you want to pay off your house, then that's fine. But again, I want you to stick to the stick to the plan, stick to the proven baby steps, which is babysit number to line up all your debt from smallest to largest. So if you got a five hundred dollar credit card and you have $50,000 in student loans, you're going to pay off that $500 credit card first and work your way up to that largest loan amount you have.

And the reason that Dave teaches this, it's all about momentum. Yes. And we understand the dilemma when you can pay off this huge debt and you can stroke a check and pay it off. That's just a natural psychological decision for a human being. They say, well, I can kill the big bug right now and take care of the little bugs later. But the idea of momentum is why Dave teaches the process that he does. And you just got to stick with the process. It works.

It's worked for millions of people, and it will work for you as well. Hey, I want you parents out there, teachers, administrators, I want you to be checking out my friend Anthony O'Neill, anthonyoneill.com. We talked about the Teen Entrepreneur Toolbox, his Graduate Survival Guide, the book he co-authored with Rachel Cruz, a fantastic book that has become a bestseller, Five Mistakes You Can't Afford to Make in College. A lot of kids, Anthony, right now around the country are moving from high school into the next season of their life, and the Graduate Survival Guide, I think, is a must-read.

You can get it at anthonyoneal.com or, of course, daveramsey.com. You want to make sure that you're checking out his travel schedule, speaking all around the country. And, hey, I'd love for you to check out the Ken Coleman Show. Leads into the Dave Ramsey Show live on Sirius XM, channel 132 every day. Hey, big thanks to you, Anthony Neal, for hanging out with me, to our producer Zach Bennett, and our associate producer Kelly Daniel. But most of all, I want to thank you, America.

Thank you for listening. This has been the Dave Ramsey Show. Hey, guys, this is James Childs, producer of The Dave Ramsey Show. I'm excited to announce that we're now carried on 600 radio stations across the country. To find one near you, head to DaveRamsey.com slash show. Hey, business leaders, are you hiring, posting your position at job sites, and waiting and waiting and waiting for the right people to see?

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