The Ramsey Show - App - How Can I Save Money so That I Can Build Wealth? (Hour 2)

Episode Date: October 27, 2021

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Thank you. Live at the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, this is the Ramsey Show. It's where America hangs out to have a conversation about life. I'm Ted Coleman, joined by George Campbell, and we are here for you this hour. 888-825-5225. That. 888-825-5225. That's 888-825-5225.

Open phones. We're here to talk about your money. We're here to talk about your work. How do you combine the two? Can you make the money that you desire and have meaning in your work? The answer is absolutely yes. There's never been a better time to do it. So George and I focus on those two key areas, money and work,

and we want to help you perform to your peak in both of those areas. So we're here together tag-teaming for you, 888-825-5225. Let's go to Evansville, Indiana. Samuel starts us off. Samuel, how can we help? Hi, Jason. Hi, George. Thank you so much for taking my call. I really, really do appreciate it. Yeah, but my name's Hi, Jason. Hi, George. Thank you so much for taking my call.

I really, really do appreciate it. Yeah, but my name's Ken, and then he's George, not Jason. Oh, Ken, sorry. There you go. Sorry, I apologize. No worries. Thanks. I work for a water delivery company making $39,000 a year as a Class B driver, and I was recently moved up out of the warehouse because I wasn't working as a delivery driver every day.

I would work in the warehouse some days and then do deliveries others. And they recently moved me up to go out in the field, push sales, try and build up business, but it was a temporary thing. They recently told me that they want me to go to school and get a CDL class A license, which would include a raise of about $11,000, bumping me up to $50,000. Or if I didn't take that position, they would give me a pay cut, cutting me down to about $25,000. Whoa. And I've been working with this company for three years. I absolutely love my boss. I love my co-workers. I love the work I do. I honestly believe that this job is God's blessing on me for putting me in the exact right place at the exact right time. I'm hesitant about

being a Class A semi-truck driver for various reasons, including the legal issues that are in the Class A industry and just a lot of the politics that are in a Class A. I've been told that I'll get to keep my regular delivery jobs. I'm being this semi-truck driver as a substitute for their other drivers when they have sick days or vacation days or if an emergency happens and they need to have a truck rescued. So I'm trying to figure out, because taking the pay cut isn't an option, I'm trying to figure out should I take this Class A position and move up the chain that way, or should I try to find another job that's a Class E driver job and try and move's the option that's best for you based on what you've told us. You've got some real concerns, and you gave us a quick summary of those concerns about being a Class A driver. And I think you have to stick to your guns on that. But you can certainly say, all right, let's look at those concerns a little deeper. And we don't have to unpack all those on the phone right now.

But as you look at those concerns, you go, okay, are those legitimate concerns? Or are those just some fears and doubts that I have because it's new and it's a bit unknown? And as you dig deeper into those concerns, it's like looking at any fear or doubt. Is this fear telling me the truth and thus protecting me? Or is this fear or doubt lying to me and holding me back? I think that's all you've got to do. I think you've probably done some of that legwork. And so if you have, we already know option B is not an option. You're not going to take a $25,000 pay cut.

And so option C, staying in that class B lane that you're in, doing that kind of work you really enjoy. In today's environment, I don't think you'd have any problem replacing this job. And you'd probably get a bump because I can tell you just on the macro scale, CNN reported last week that there are as many as 70,000 to 80,000 truck drivers that are needed right now across the country. Wow. So there's a massive need.

And so even the Class B, I'm sure in your area, you can replace this job pretty quickly. So I think you've got to trust your gut. Have you done your homework on those concerns, and those are valid concerns? I am still doing research. I have already confirmed that a few of them are fears like the fear of getting pulled over and being falsely criminalized because one tiny little thing on my truck, it might be wrong. But it is a thing that most of them are turning out to be more fears rather than like, is this something that could be completely detrimental to me and my career and my life? Well, I think you're starting the process.

I think you truly look at this and you have to decide which is the best path for me. You're going to move up if you take the Class A job. You're going to move up if you take another Class B job and do a really good job. So I don't think that there's necessarily a wrong decision that's sticking out other than option B. We're not doing that. We're not taking a pay cut. So I think you sit with it, you pray through it, and you take what is best for you. And, George, I hear this a lot on the Ken Coleman Show.

We hear it here on the Ramsey Show when we get these calls. You've got to weigh options based on what allows me to move further down the road. And if it's faster, great, but it doesn't always have to be faster. What's the right decision for the long term? Always the long view here. And obviously, in this case, the one taking a pay hit is not a good move. And he's got to weigh, okay, which is the option that I enjoy the most? Because we don't want to just take the fastest route

if it's got all kinds of detrimental effects and harmful circumstances that come with that. It's not worth it. And a lot of that comes from, Jordan, you and I have experienced this in our own journeys where we think, well, this is the only one. This is the only way I can move up. And that's just not the case. No. And it seems like a cruel punishment to say, hey, if you stay doing what you're doing that you enjoy, you're going to lose $14,000 a year. That's strange to me. I don't like the ultimatum that he's put in here. I know he enjoys the work, the people that he works with, but I would be searching and I would be going, hey, who's got the biggest sign-on bonus that I could leapfrog right now and go, oh, there's other Class B driver jobs out there that pay $10,000, $20,000 more and I can do what I love.

And George, great point, because I'm going to tell you right now, if you're a driver, class A, class B, class Z, I don't care. Huge need right now. Yeah. Massive need. Deliveries are suffering. The whole trucking industry is so stressed. Well, supply chain.

I mean, if you look at supply chain, we're seeing this in the news every day. You're going to keep seeing it. I'm seeing crazy articles now and headlines that are saying, Christmas is going to be tough this year. You might not be keep seeing it. I'm seeing crazy articles now and headlines that are saying Christmas is going to be tough this year. You might not be able to get the Christmas present. We saw that last year. I mean...

We're doing an episode on the fine print we're putting the finishing touches on right now around this whole topic of holiday spending, supply chain, what it's going to mean for you as a consumer. But on the job side, there's such a massive need. If you're a person of character with any level of work ethic and you just show up and you're a warm body, they go, oh my gosh, you're amazing. You're looking at pay increases.

I mean, now is the time to move. So I got to tell you, I'm just going to push this out there. If you got a family life that can support it and you like being on the open road, I'd be looking into driving a truck right now. They are paying crazy money because there is a massive need. So really interesting stuff. Thank you so much, Samuel, for the call. You've got this. All right. Don't move. More of your calls coming up next. This is The Ramsey Show. You've got a lot on your plate, a job, your home, your marriage, and your growing family. While you're enjoying the present, you can't help but think about your future and your finances. As you explore your options, consider Christian Healthcare Ministries, or CHM, for your health care.

Their generous maternity program and budget-friendly monthly programs have been a blessing to members welcoming children into their families. Visit chministries.org slash budget to see if it's right for you. Christian Healthcare Ministries is a Ramsey-trusted provider. Welcome back, America. You are listening to The Ramsey Show. Thrilled to have you with us. I'm Ken Coleman, joined by George Campbell as we take your questions.

You need to find out for yourself why Blinds.com is the number one online retailer of custom window coverings. You get free samples, free shipping, and with the new promos they run every month, you'll save even more. Use the promo code RAMSEY to get the best deal. Today's question comes from Grace in Wisconsin. I'm 18 years old and currently enrolled at my first year of community college. I have money saved for my bachelor's degree in finance, so I will have no student loans. I work 23 hours a week making $15 an hour at a bank. I see job postings all the time that I'm qualified for that have starting salaries of $45,000 or more.

Taking into consideration how desperate employers are in today's job market, I have the potential to make a lot of money if I wasn't in college. Should I continue to get my degree in finance or go straight into the workforce where I have a potential to make a lot more? Oh, I love this question, George. You ready? I'm ready. Yes and yes. Continue to get the degree in finance, but I'm going to back off to part-time online. I'm going to slow down the rate at which I'm getting the degree in finance because I've already invested in it. And in this case, the finance degree is going to give her some very viable options. And then I would take the full-time job at these banks, making the $45,000 or maybe more. So this is a both-and.

And so I'm not telling you to stop college i would slow it down finish online because you can do that and go start banking the money george because now she's going to get um uh experience and money and connections those are invaluable and the degree she can just putz along with that and finish it off. Yeah, that's huge. I mean, if I'm an employer and I'm going, all right, do I want to hire someone with no experience who has the finance degree or hire someone with four years of experience who doesn't have the finance degree? You got to weigh those options. I think you make a good case.

And I think at that point when she says, hey, I'm actually finishing my program, but I wanted to get in the workforce and really start doing this stuff and gain that experience. If I'm the employer, I'm very impressed already. And she's got no debt, which gives her so many more options. I love this option. She's not desperate. Listen, the world has changed. You can finish out a degree online.

So I wouldn't even stress. You know, she'd go, well, I get the full-time job. How many hours should I take? The least amount possible. Because you can just keep whittling that thing down and you're making real money and making great progress. I love that question. And she's at a community college in her first year, so she's probably knocking out the prerequisites right now. Yeah, that's what I think. So maybe there are better options out there to get that finance degree. And you know what? I should, thank you for pointing that out. Because I should point out, I would, I'd take the bank job. I'd get

in there and I'd start talking to people that are up the ladder where she wants to be and say hey how important is the finance degree they're probably going to say you need it so I so I don't think my advice changes but I would just add that little caveat in there depending on which way she wants to go in finance it may or may not be required so really good. Thank you for the question, Grace. All right. The phone number is 888-825-5225. Let's go to Toledo, Ohio. Home of the Toledo Mudhens, George. I did not know that. Yeah. How many unnecessary facts do you have in your brain? I have a lot of them and I might just start to throw them out there just to irritate James, the producer. Make sure he's paying attention over there behind the board. All right. Let's go to Adam. Adam, how can we help? Hey, guys, I appreciate you taking my call and what you're doing to help.

I work in full-time ministry. My wife is a stay-at-home mom who works a few hours on the side part-time. We have a household income of about $32,000 a year. And working through the baby steps for a while now, we've got our debts all paid off, none of that. We've got our emergency fund funded. We're contributing fully to our IRAs, and we've got a little bit going to our son's college fund. And as I understand them, the next big thing for us is a home. And it's been slow in that regard.

We're pretty much throwing everything in savings we have toward our house fund and kind of wrestling with this kind of gazelle intensity toward that. That's going to take several years given the income we've got now. And it seems a little restricting for us, kind of hinders some extra giving we could do with that, some enjoyment too. But my question is, how do you think we should go about funding our house? Do we keep saving, throwing it at a savings account, put it in a mutual fund? We've also mentioned the idea of just putting off owning a home until retirement, because right now we live in a parsonage. The church provides the housing, and that could change. But if we could just kind of concede that and say, well, wait until retirement, put our extra savings toward retirement, and just rent in the meantime should our situation change.

I just wondered what you guys think about how we should go about funding our house. Yeah, we took a very similar question on the show yesterday with Dr. John Deloney and I when they were living in the parsonage rent-free. Is there a housing allowance that you could also get? Yeah, for some housing expenses, I can claim some of that. Okay. Yeah, it sounds like I'm living in the parsonage. Are they covering all expenses, utilities, everything? No, they own the home. We're living here. We pay all the bills and stuff.

You pay all the bills? Yes. So where's the upside of this? You said housing is provided. Right. Well, they own the home. We don't have to pay rent. There's no rent or mortgage payment.

No rent, but you're paying utilities. Right. Okay. That's pretty traditional for a person. It's like a rental situation. Got it. Okay, so they're covering the rent, basically. So if I'm you guys, I know you have this income. Is there a trajectory to make more in ministry going forward?

Not real soon, necessarily. And I know your wife is working a few hours how much bandwidth do you have to bring in more income i just it doesn't sound like there's going to be much more margin in the future to start saving for a house right so unless until if she gets at a point where she's comfortable working more full-time when kids get older or my income situation changes significantly, there's not a whole lot that we're looking at. Are you a senior pastor, and what size church is it? It's a small church. It's a small town, small church. I am the preaching minister there.

Okay. Yeah, so the reason I ask that, Adam, is because I'm a son of a church planter. So my dad planted two churches, just recently retired, 47 years in the ministry, and he always pastored small churches. And just having watched my dad, when we had to buy houses and do things like that,

I mean, he took on a second job. And I just wonder how open you are to that because I think where George is trying to help you with, it's like where's the extra income? And for my dad, which was a pretty similar situation to yours, he went out and he worked extra jobs. He took on construction jobs on the side because, you know, he didn't have the traditional office hours of a pastor with a larger church. So are you open to that type of work to be able to bring

in more income? Yeah, so I do a little bit of that already. I substitute teach sometimes. But yeah, the time's a little constricting. I don't know if I could do a good job with my ministry here if I gave a whole lot more time to working. Okay, well, I certainly understand that too, and that's all very subjective. I want to make sure we answer your question of what does saving look like, where should you park any extra margin you have, and if it's going to be like a three to five plus year time horizon, you could park that money in mutual funds. Of course, you can connect with one of our SmartVestor pros in the Toledo area, and they can sit down with you and educate you on where

the best use of your money might be and make some recommendations there so that that money can grow for you at 10%, 11% for the next five plus years. And maybe that time horizon looks different for you guys. Maybe it's 10 years from now. If you're going to be in ministry and have this rent covered, there's nothing wrong with going, all right, one day we will own our place, but we're going to have some patience here. Yeah, and that's the key, because he's in a very limiting financial situation. He's just a small church like that. The raises, they aren't guaranteed.

When they come around, they're not very big. It's just that it's a smaller church. That's just the reality. I certainly know the world that he's in. So his wife working, him being able to work some weekend, maybe some Saturdays, but he's getting ready for Sunday, so if his day off is Monday,

does he use that day? He's going to have to get creative and sell some stuff. It does look different. But it can be done. It's going to take a while. Good stuff. Thank you for your service uh we appreciate the call adam all right hard to believe george got another commercial coming up time flies when you're having fun yeah we'll be right back this is the ramsey show work doesn't have to suck there's a reason you can't shake the feeling you were meant for more than just another J-O-B.

61% of people aren't even engaged at work, let alone doing work they love. That's why Ken Coleman, America's career coach and national best-selling author, wrote his new book, From Paycheck to Purpose, The Clear Path to Doing Work You Love, and it's available for pre-order right now. If you're looking to change jobs, get hired, or trying to figure out the work you were uniquely made to do, you need this book. Ken walks you through the proven stages that landed him his dream job and thousands of others.

Plus, if you pre-order from paycheck to purpose today, you'll receive our Get Hired Bonus Pack, valued at over $100 for free. It includes the audiobook, e-book, resume, templates, the Get Hired digital course, and more. Pre-order from Paycheck to Purpose at RamseySolutions.com. thank you for joining us america this is the ramsey show i'm ken coleman joined by george camel and we are here for you this hour triple eight eight two five five two two five it's a toll-free call triple eight eight two five five two two. Let's go to Hermiston, Oregon, where Casey and Jennifer are on the line. And Casey and Jennifer, it says here that you guys are here to do a debt-free screen. Yes, we are.

Oh, that is so awesome. How are you guys? We're good. We're excited to get this debt out of the way. I thought they said they were excited to get the call out of the way. I was like, well, you made it this far. Well, you know, this is the moment. That's right. That's right.

But you know what Casey's really saying there? I mean, he's pumped, and he's like, this is the finish line. This is the moment we've all been waiting for. They've done the work. Now they cross the line emotionally. So awesome. Well, let's get to the details. Tell us how much

you paid off. We paid off $50,000 in the last nine months. Oh, come on now. All right. And what was the range of income during that time? $110,000 and now we're up to $160,000. Whoa. Well, you know, I'm the work guy, the big shovel guy, making more money, making more impact guy. I got to know, what'd you do to jump up $50,000? My wife finished her grad school, which was part of some of our debt. And with COVID kind of winding down a little bit here in Oregon, we were able to do some more coaching. We're both in education. And then a big help is we actually flipped a house with some friends. So that was huge. Very nice. And by the way, congratulations, Jennifer, on the grad school. and then a big help is we actually flipped a house with some friends so that was huge very nice and

by the way congratulations jennifer on the grad school thank you yeah that's exciting stuff a couple years yeah i can hear the relief uh okay and uh well we we know what some of the debt is we've already heard some of that but give us the picture what was the 50 000 in debt was it all student loans no we had student loans a car loan and then quite a bit of money for our next child with IVF. But that's all paid off now. Oh, awesome. Okay, very good, very good. I certainly understand that journey.

All right, so what do you do for a living? You're both teaching and education? I'm a teacher in education. I also coach some sports. And my wife, go ahead. I'm a speech-language pathologist for our school district. Oh, very nice. Casey, what sports do you coach?

I coach basketball and tennis. Oh, I love it. Don't get Ken started on basketball. Yeah, we'll keep the talk away from the 2-3 zone versus the man-to-man. All right? We won't talk about any of that. Oh, yeah. I could talk all day about who's.

I'll bet you could. We'll spare the audience and Jennifer, shall we? And me. Yeah, and George. Amen to that. Yeah, George has no idea what any of that means. Okay, and so what happened nine months ago for you guys to go, we're getting rid of this.

Well, we were on our computers. I was teaching from a computer, and my wife was trying to do speech-language pathology from a computer about nine months ago with the whole COVID thing. And we weren't able to coach. We weren't able to do much. And so we were home a lot, and we decided we looked at our finances. And we're both into finances, but it's time. We just didn't want any more bills.

We want all our money going to giving and investing. And we come from some financial advisors. My mom's a financial advisor, and so is my brother-in-law, Jennifer's brother. So we just, yeah, we had some goals we wanted to get to, and we just needed to get it out of the way. That's incredible. So how did you get connected to the Ramsey plan specifically? Was it from your mom and the brother-in-law or what?

No, I just kind of started, had a little bit more time on the computer, so I started listening to more podcasts with the YouTube channel and then just have it on my phone now. And then my wife, we've always heard of Dave Ramsey. We just didn't have the time to listen all the time. And now I listen almost every day at least for a little bit. Stay motivated. So what exactly did you do?

I mean, 50K in nine months, making what you guys are making, there were some sacrifices made here. Yeah, we broke down our car payment to start and just decided just to put all our extra money towards our car payment and then the student loans because we knew we had the IVF stuff coming up. And so we were home a lot and just really broke down our budget and did the envelopes for all our bills instead of just using our debit card all the time, which really helped. You just went hardcore. You were getting real nerdy going, all right, what is every penny doing in our budget? Because we want this debt out of our life.

Yeah, we got a little bit nerdy. That's incredible. I love that. When is baby on the way? We have one daughter, Elvia, who's two, and then we're hoping to have our next one. We're going into the doctor on November 16th with our next process with IVF. Okay. All right.

That's what I was wondering. Well, that's awesome. That is fantastic. So who are your biggest cheerleaders along the way? Oh, so my family is, I have an uncle and aunt who both are coordinating Financial Peace University in Sacramento, California. And my brother, as a financial advisor, did Financial Peace University a couple years ago. So they were definitely our biggest cheerleaders. And we would call my brother like every other weekend and be like, hey, what do you think about this?

We're always just running ideas by him. That's awesome. I love that. I want to give the aunt and uncle a shout out. Yeah, that's fantastic. What are their names? Ernest and Gail Brown. There it is.

Ernest and Gail Brown. Solid coordinator names, I've got to say. Yeah, you think so? Yeah. I love that. Thank you for coordinating. You guys are on the front lines. You didn't just help out Casey and Jennifer. You're helping out so many people. That is awesome. So we always ask folks

that are doing their debt-free scream, George, and we want to ask you, Casey and Jennifer, what would you say to people that are listening today is the key to getting out of debt? I would say the key is just talking about it with your spouse, have to be on the same page and encourage each other. When I talk about biggest support, not only our family, but just my wife, you got to work well together. And once you start seeing that as debt numbers go down, it just feels good. You just feel a nice relief where you can use your money towards more important things. Communication, monthly communication about finances, if not more. That more that's incredible yeah that level of

teamwork it's been a thread and a lot of the debt-free screams i had with any couple they always go we got on the same page we started communicating maybe for the first time in their marriage and it changes everything way to go guys we're so proud of you wow so what would you yeah what would you guys say to couples that are listening in and they're going, I don't know, can we really pull this off? How would you encourage them? I would just say it doesn't really matter, you know, your profession. You just have to sit down and really look at every single dollar, where it's going, especially if you have some debt, and how you can use extra money to go towards that debt because eventually that debt's going to go away if you stay focused and not finished.

Yeah, I love that. Well, that is really great stuff, and we appreciate you guys so much for coming on and sharing your story. We want to gift you. We're going to send you two books. The first book will be The Legacy Journey from Dave Ramsey because that's the next step for you all as you build a legacy. You guys are on your way. And we also want to give you a copy of the Total Money Makeover,

and we want you to give that away. We want you to decide who needs that book, and we trust you. We know it's going to do good things. So that is a gift for you to give away as our appreciation for you all sharing your story. So you guys ready to go? We are. Now, are you in separate rooms, I'm guessing?

No, I joined at lunch work time. We zoomed over real quick. Oh, super excited. Okay, here we go. They're ready to go, George. It's Casey and Jennifer in Hermiston, Oregon. They paid off $50,000 in nine months, making first $110,000, all the way up to $160,000. Casey, Jennifer, this is your moment.

Let's hear your debt-free scream. Three, two, one. We're debt-free! Yeah! Jennifer, going. She's going after it, man. They went ham. Coach started laughing.

Did you hear him? He started giggling, man. And Jennifer just took it, baby. They went ham. Coach started laughing. Did you hear him? He started giggling man. And Jennifer just took it baby. That was awesome. That's the half court shot. Yeah. Especially on the phone. The goal on the phone is to do it so loudly you distort the phone quality and it gets garbled. Well you're a musician. I think

she did this number. Did she throw the head back and kind of take it up? I felt that. I think you're right Ken. Good observation. Yeah you know you see these musicians at concerts, they hit the big note and they kind of pull away from the mic and you and James know more about that than I do. But I feel like she really took it to the roof. Yeah. Very impressive. Great story.

You know, I've got to give Coach a hard time. Jennifer outplayed him on that one. You know, I love Casey. I love Coach. You love a good sports reference, too. Well, I do. And during the break, George, I'm going to teach you the difference between a 2-3 zone and man-to-man defense. My brain just melted a little bit.

It might take a while. It's going to be great. It's going to be a great conversation starter for you in the future. You'll thank me for it. Hey, folks, don't go anywhere. This is the Ramsey Show. Thank you. This is The Ramsey Show. It's where people congregate to have a conversation about serious stuff like life, money, your work, your relationships. We're here to help you. I'm Ken Coleman, joined by George Campbell, and we are here for you. The phone number to jump in on the conversation is 888-825-5225.

That's 888-825-5225. That's 888-825-5225. So how many of you out there are among what is being reported as millions of Americans looking to change jobs in the next year? 4.3 million people left their jobs in August, George. It was a record. Economists are calling it the great resignation. And that's why we're hosting From Paycheck to Purpose live on Thursday, November 11th at 645 p.m. Central Time. It's based on my new book under the same title, From Paycheck to Purpose. It's going to give you the plan you need to get unstuck, find your dream job, and leave a legacy. Here's the truth. You don't

have to choose between making an income and making an impact. You can make money and experience meaning. It's time to go from just collecting a paycheck to doing the work you were created to do. Join us via live stream or we have limited spots. It's going to be fun experience live here at our Ramsey Solutions headquarter as I walk you through the clear path to finding the work that you love. Event passes start at just $10.

That's crazy, George. We should be charging triple that. That feels like a wrong dollar. I've got to talk to the team about that. $10? I don't know.

Event passes start at $10. Learn more by texting the word PURPOSE to 33789. Text the word PURPOSE to 33789. This is word purpose to 33789.

This is going to be a fun event. It's going to equip you. It's going to encourage you, and it will entertain you. I can't believe we're selling it for $10. George, I keep looking at that. It's not a typo. And this is a great event. I was at the Get Clear livestream event that you did a little while back,

and it was powerful, especially if you can be in the crowd. There's some special moments. And we're doing something unique. I told the team. We got together. We sort of brainstormed. We said, let's do a really intimate setting to create an even better video visual setting for the crowd that's going to watch it via live stream.

So we'd love for you to join us either on the live stream or in person. Purpose is the word. Text that to 33789. Let's go to Orlando, Florida. Ellen joins us there. Ellen, how can we help? Hello. Thank you for taking my call. You bet. What's up? Okay. So I have a car question. I'll just give some background. At the end of the divorce, and I'm on a every dollar budget. I don't have any debt. I'm building up my emergency fund. Um, in addition to that, I have a $15,000 in an investment account and I'm expecting a $15,000 settlement. Um, now I have a car that I got about a year ago. I bought it for $3,500 and it's been having some problems lately. I was told that

I would have to put in about $2,000 to be able to keep it running properly. And I can sell it now for $3,000. So I'm looking to sell that car and then buy something else. And the question is how much to spend on that. Do I stay within that type of a limit or do I go for something more affordable? Yeah, good question. What's your household income? $40,000 and then child support of $1,400 a month. Okay. And you're working on building this emergency fund.

How far away are you from completing that? So right now I have $3,700 in it. My goal is $22,800 to be exact. And that $15,000 settlement is going straight into there. Perfect. So the settlement will get you through baby step three. And you said you have $15,000 in investments. What kind of investments are those? So that's an investment like that my grandparents set up for me. It's like it has an 11.4% return on investment from what I saw. Okay. I've never touched it.

I've never taken anything out of there before. And these are just like, are they stocks, mutual funds? It's non-retirement, right? Non-retirement, right. Okay. If I'm you, I'm using that settlement to fully fund the emergency fund, and I'm going to take a portion of those investments and use that to upgrade your car. You could cash flow it.

It just might be a little longer, which means you might have to use this car for another six months if you want to save up and pay cash for it and not touch the investment. But since it is, you could liquidate those investments with no penalties other than your capital gains. So I would talk to a tax pro. You can find those at ramseysolutions.com to figure out what the tax implications are of taking out a chunk of those investments. You're just going to pay taxes on the gains, but it may be short, long-term, depending on your situation. So if I'm you, you're asking how much car should I buy? I don't think you need to get crazy with your income and with your financial situation. I want you to be able to move through the baby steps, start investing 15%. And if you've got kids, start saving for

college and pay off your house after that. So to do that, I want you to have margin. And right now, getting a car, even with cash, I don't want you spending $20,000 on a car. But you could spend $5,000, you could spend $6,000, and get you something that's going to get you from A to B. Right, okay. So if you sell yours for $3,000, that means you only need to pull $3,000 from the investment account to get a $6,000 car, right? Right. to pull three from the investment account to get a six grand car right right i mean the car people that i've been speaking to have been advising me that i'm not really going to get much better and i'm still going to have all the problems that i have um because of the used car market now yeah

i'd get this thing uh out of your life and get something a little bit more reliable and if you can get three grand for it even with its issues i'd say get rid of that thing and you've got money. I just don't want you dipping into your emergency fund because let's be honest, it's not an emergency. You know this is coming. You know the car's on its way out. So I don't want you to have a moment where you go, well, I got this emergency fund and the car broke down, so I'm going to spend 20 grand on a car. Let's get something reasonable for now. And here's the thing. You can upgrade that car later on. Maybe you make a little more money. You feel like you're in a good spot financially. You put a sinking fund going in your every dollar budget, and you go, I'm going to put away $500 this year or this month,

and I'm going to add that up, and once I hit $8,000, I'm going to upgrade the car again. And you can keep doing that. Yeah. Did you say that putting the $2,000 in the car, the current car, would actually make it run well, or your mechanics are saying, eh, it's just a Band-Aid? They say it will take away the problems for now, but I haven't found it to be a very reliable car.

What kind of car is it? It's a Nissan Pathfinder 2007. Okay. Yeah, I think in this situation, but do you think you can get three with all the problems it's having? Yeah, I have someone that's willing to take it for three. Oh, all right. Well, I'd take the three, and then I would go get something in the five range. You can get some stuff that's pretty dependable, but do your homework on this.

My car was six grand. 09 Honda Civic runs like a champ. Yeah, listen, the Hondas, the Toyotas, do your homework. I mean, these cars are very, very dependable. Do you have a car in mind that you're looking to buy um not specifically okay that's just my my hot take is if you're looking for reliability honda and toyota well but yeah you can do your homework uh you can do your homework and uh i'm gonna tell you right now i'm looking all the time because i got a 15 soon to be 16 be 16-year-old, and I can tell you, Ellen, they're decent cars that can be very dependable in that five grand range for sure. Yeah.

And here's the deal. The Dave Ramsey method where you just show up with five grand in cash and you look it over, you mull it around ask lots of questions very emotionally detached not desperate at all not at all very excited barely like why am i even here all right because they want to move the car anybody selling a car for five wants to move the car all right so then you go all right, well, I'm thinking, well, and you just pull it out of your pocket. And you just count out 4,000. You go, would you take four? And then let them react. If they say no, absolutely not, 5,000, hard price, I'm not moving, great.

Then you've got options. If you want it, you can buy it. But I like going at four, George. Because I like them, in my mind, coming back at 46, and you go option if you want it you can buy it but i like going at four george because i like them in my mind coming back at 46 and you go would you take 42 little negotiation you say where this goes see where this goes be smart about it and you're thinking people say cash ken you can't get a car for that in this market oh yeah have you looked have you checked facebook marketplace i'm telling you you can yeah you can i'm wearing out facebook marketplace i had no idea this existed i didn't know you were on facebook and i'm very impressed Marketplace. I'm telling you you can. Yeah. You can. I'm wearing out Facebook Marketplace.

I had no idea this existed until about a year or two. I didn't know you were on Facebook, Ken. I'm very impressed. Well, I should point out that I'm only the Ramsey Solutions social media team. Okay. But I have a dummy account. That's the way to do it. And I go in there.

Nobody knows I'm there. And I'm just on the Facebook Marketplace. That's so good. Yeah. Just sold a car, by the way, on Facebook Marketplace. Way to go. It can be done. Ken Coleman did it. Yeah. Oh Oh boy. Let me tell you something. I am below bar. If Ken can do it, anyone can. All right. Hey, I want to thank Kelly Daniel and James Childs.

We'll thank you, George Campbell. Thank you for hanging out with us. This is The Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Ramsey Show. If you would like to do your debt-free scream live on the show, make sure you visit theramseyshow.com and register. We would love for you to come to Nashville and tell Dave your story.