The Ramsey Show - App - How Do I Pay Off Medical Debt? (Hour 2)

Episode Date: May 10, 2021

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the 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, Rachel Cruz. Ramsey Personality is my co-host today as we answer your questions about your life and your money. Open phones at 888-825-5225 that's 888-825-5225 it is a free call and some say the advice is worth exactly what you pay for it elizabeth is with us in tyler texas to start off this hour. Hi, Elizabeth. How are you? Hi. Thank you for taking my call.

Sure. What's up? Okay. So my house shares a driveway with three other homes. And in addition to that, we also share a sprinkler system that is all one system for all the houses, as well as one water meter for just the sprinkler system. So ever since the house was built, all the neighbors have shipped in money together into one account that one neighbor manages to pay for the water bill, the upkeep of the sprinkler system. And since we're doing all of that, we also go ahead and just do a lawn service together.

Historically, the lady who has done it, she's just been in control of it. She's been there since the beginning of the development. I'm sorry, say that. I didn't hear that first part. You broke up. What about the first of the development? What? So the lady who's been running it in the past,

managing that account in the past, she was there from the very beginning. She is turning 92 this year, and it is time for her to pass it on to someone else. Wow. Okay. Yes. So I am willing to take care of it. It's very little work.

I mean, on a typical month, we only have two bills, just the water bill and the yard bill. So it's not a whole lot of work. The thing that has me concerned is making sure it's set up properly in a way where the account where the money is held is not considered a business income account for me or something that I totally control so that everyone's protected. I don't want to get audited by the IRS and get in trouble and for them to get business income, but I also want my neighbors to have access to it if something were to happen to me. You know, if I were to get in a car accident or something, if someone else, you know, it's not my estate's money, it's their money.

And so I'm trying, I'm just looking for advice on how to go about getting this set up properly so that we're all protected equally, you know, fairly. Okay. There's two or three things involved. One would be the legal ownership of the money and how the account is set up. Two would be the tax issue. Right. And you can get as complicated as you want to get here.

I wouldn't overcomplicate it. I'm guessing that she just opened this account in her name probably and never reported it and wasn't worried about an audit. I'll bet you that's how she was running it, just out of her hip pocket. I'm fairly certain that is correct. It is technically a business account, but it is under her social security number at the moment. Which means that technically she could have been taxed on this if it were profitable, if she were ever audited. Probably a fairly low likelihood, and she was willing to take that chance. If you want to go a step beyond that, you need to just form an entity with the IRS and

get an EIN number, an electronic identification number. And that's what you would get. That's the same number you would get if you formed an LLC or a sub-S corp. That's the next step you could do is form an LLC. I would not. Too dead gum, much trouble. I would just get an EIN with the IRS, and if they ever approach you, just go, it's a separate entity, three neighbors managing the account, there's no profit,

and you could just blow it off in an audit. But if you put it in your social or in an entity that you run business out of, then you could end up, it could end up getting blended in. So just order an EIN. Order it. It takes about, it used to take 90 days online. Now it probably doesn't take that long. You probably get one overnight now. And you just open that.

You use that instead of a social security number to open the account. And just open the account and give it a name called the neighbor's. I don't care. And the neighbor's water account. I don't know. And then if you have a written one-page document of agreement with your neighbors, there's never been any drama so far, right? Correct. Everyone's agreed to it.

I mean, I guess technically if the house ever sold to someone who didn't want to be a part of it that could in theory happen yeah yeah and i wouldn't i really wouldn't go to the expense to legally bind all this i or to mess up one of your ownership positions with this um you just have to work that out with the new neighbor one way or the other and it might not be relationally pretty but it won't be a legal problem so anyway just i would have a one-page document with your neighbors that just says in a letter form what it says i'm not an attorney this is just what i would do personally just so there's clear communication with your neighbors put all of them on the checking account and open a checking account with a fresh ein and i would just run it that way that's how i would do it

just keep it real clean if you want to go further you could form a non-profit with a fresh EIN, and I would just run it that way. That's how I would do it. Just keep it real clean. If you want to go further, you could form a nonprofit with a board and an LLC. Now you've got to file tax return on that every year, and you've got to file with your state every year, and it's a complete pain in the butt for something like this. It's a tremendous overkill. Right. Just a follow-up question to that. I did look into getting an EIN, and you have to declare a responsible party.

Yeah. Which means, in a way, it would still be a tide to me. Is there any concern that you have with that? I wouldn't worry about that. The big deal is, in the event you were audited, you have a clear paper trail that this is a separate entity and it has no profit to it. It has no profit motive to it. It's a simple transactional account. Screw you.

We're not owing any taxes on it. I mean, you can beat this audit in 20 seconds. And if you don't, then I'm going to beat it in 20 minutes over the top of somebody's head. It's just a matter of you've got to find somebody in the IRS who has half a brain to explain it to. That might be a challenge, but you just have to work that through. If you have time, I have a completely different question. I'm sorry I do not i apologize but thank you for the call i hope that helps you we appreciate you joining us open phones at 888-825-5225 nate is in gettysburg pennsylvania hey nate how are you

good how's it going dave better than i deserve what's. Okay. So my question here, I'm a 29, I make about 50,000 a year. Now I have some medical debt, uh, mostly like hospital and doctor bills that have gone to my credit report, uh, totaling up to about, uh, 16 to $17,000. I just started listening to your podcast about three months ago. And back in November last year, I did something I realized now I don't want to do. And I went and bought a car. And so now I've got this $21,000, $22,000 of car debt and medical debt. And I want to get out of it. I just a few days ago purchased the Total Money Makeover.

And I'm just wondering, where do I start? Yeah, that's a great question, Nate. I mean, well, specifically with the debt, how many medical debts do you have that total, that $16,000? I want to say it's about 11, 10 or 11 things on my credit report. Small ones, yeah, yeah. And then anything else besides the car? That's it. That's it. That's it.

Well, I would list out all of those. I mean, even though it's 10 or 11 of them, but listing them out smallest to largest, starting with that smallest one and then working your way down. And the car thing, yeah, I mean, the $22,000, you don't have to sell it. It gets to a point that you could say, yeah, it's not worth it anymore and see what the hit was that you took. What's your household income? Yeah. $50,000.

Oh, $50,000. Yeah, you're right on the bubble. That's a lot of car. That's a lot of car, $50,000. Yeah, I'd probably consider reversing that decision, meaning selling the car, if it were me, just because I'd want to clean this mess up faster than that and plow through that $16,000 in medical debt

using the debt snowball. That'll get you there. You've got the right tools coming to you. And thank you for being a listener. Do you know who is a prime target for identity theft? Your children. Kids have no debts or credit history. Their personal information is just as easy to get,

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Zander.com or 800-356-4282. Rachel Cruz Ramsey personality is my co-host today. Also my daughter. Author of three national, four national bestsellers. And the latest one, Know Yourself, Know Your Money. We are launching today the Know Yourself Money Assessment. Now this assessment is incredible. It will guide you to lasting progress towards your money goals and better money communication because you will understand yourself.

You'll understand your money tendencies, your money fears, your money upbringing after you take the assessment, and your spouse can take it with you. It takes about 15 minutes to take it. It spits out 30 pages of detailed and personalized insights. Really end up knowing what's going on, don't you? Oh, yeah. Every part of why you see money the way you do, from your upbringing to your tendencies, to your fears, your motivations, your actions, all of it. So it's always fascinating.

I love this stuff personally. I was excited to work with the team on it because I think assessments in general are just so interesting. It just exposes a lot. The quality of the research and the quality of the, I don't know, the graphic detail that it puts out. The way the graphics look is what I'm trying to say. Oh, yes, yes. The way the graphics look, the way it's laid on the page to understand it. Oh, it's beautiful.

I'm just really proud of our team. Well, they did a beautiful job designing it. It's really, really, really. We should have charged twice as much as we're charging for it. Yeah, well, to that point, though, honestly, the visual, yes. Once you get your results, the 30 pages, yes. Like you're saying visually. Yeah, it just tells you exactly what's going on.

It's so easy to read and understand, yeah. It's crazy. It's wonderful in that regard. I remember 1,000 years ago, I took the DISC assessment. I mean, man, 30 years ago. So the first time I ever saw anything like this. And it was so amazing because I had like 27 questions and I read my mail. You know, it's like, this is who you are.

I'm a high D, high I on the desk. And everybody kind of knows that. But I went home, I handed it to Sharon, and she's reading through it. And she starts laughing. She goes, oh, this is what's wrong with you. And I went, no, that is me. That's not what's wrong with me. That's all the stuff.

Yeah, it took us about 10 years after that to convince her her particular type of disc was not the right one and everybody else's was the wrong one. But this tells you not who's right or who's wrong. It tells you what your tendencies are. And then you say, okay, I have a tendency to be a spender versus a saver. So I have to guard against the toxic version of that. Yes. And so on. So it's only $20 to take it, $30 for a couple. So jump in there, take it with your spouse tonight.

Go to RamseySolutions.com, the Know Yourself Money Assessment. Take it to the next level. RamseySolutions.com. Again, $20 for singles, $30 for couples. We should have charged double because it's really, you're going to get it, and you're going to go, y'all aren't charging enough. All right, our question of the day comes from Blinds.com. 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 possible deal. Today's question comes from Jamie in Indiana. We follow the Ramsey plan with our finances and are trying to teach our young children the same principles. We have a chore chart and are learning that they must work to get paid. However, every time we see my parents, they give our children money. It's becoming

difficult to keep them engaged in the lessons we are trying to teach when grandparents just hand them cash. How do we handle this situation? You know, I've not started doing that yet. I should do that. I should mess up your parenting by giving the kids cash. No, no, no. It's like the swing set example. That's always what I always tell people.

At Christmas that year when Denise asked for a swing swing and y'all bought a swing and then y'all bought a swing set she was like i just want a fisher price baby swing that's all i want and y'all got and we literally looked at each other me and denise were like oh it begins here it is and so it begins just throws out everything and just yeah no but but honestly jamie i'm like this this is a this is a people have this question a lot because grandparents have the entitlement as they feel to do whatever they want with the children and then they send them on home and you're like no we have a bedtime all of this but um you know i wouldn't be crazy uptight jamie i mean i think depending on the age of your kids and depending on how much they're doing it if they're just kind of having fun with them, there is a level where I give grace to grandparents where they can love on the kids. But if you find that it's truly affecting like

their character and they really, really, really are saying like, I don't want to do chores because I can just go to Mimi and Papa's and they just give me money. Then yeah, then we probably want to circle back and have a conversation with the grandparents with your grandparents to say, hey, this is what we're trying to implement in our home. And because of your generosity and your big, wonderful hearts, it is kind of messing with it. But again, I'm so balanced in this because I know some people, Jamie, I'm not saying this is you, that are on the Rams plan are very legalistic. Like, no, if you do not do it, and then they don't allow any amount of like gifts or grandparents be grandparents so there's a level of that that is life but if it goes to the extreme then yeah you may want to circle back and have a conversation yeah yeah and i i think um the

question i always ask is um is this really about you and your mom or is this really about you and your mom, or is this really about the kids getting money? And is there something else going on that's a Dr. John Deloney thing that's not really a money grandparents? I don't know how, you know, it's just like your mother is overbearing, and this is one example where she's out of control and has no boundaries, and so you decide to use this one to come down on that overall issue and so yeah if that's going on then that's this is not the way to fight the fight you got to fight the fight a different way on that yeah so but again it's not going to screw it up the other thing i will say is this um they can go uh to the next door neighbors and eat ice cream and you find out about it later and you don't allow

ice cream because of your nutritional beliefs or whatever i'm making up some bizarre example here but i mean the kids are and that does not give them permission to come home and demand ice cream so you know the the reason we teach children how to handle money is not really about money it's really about them building a generosity muscle building a saving muscle building a wise spending muscle building a work ethic and so when we put chores on the refrigerator we're going to incentivize you on the positive side with money but at the end of the day you're still going to do the freaking chores because it is my job as your dad to make you learn how to work so that when you grow up you don't live in my basement and so i can explain that to a four-year-old i can explain it to a six-year-old i can explain

it to a 12-year-old that yes your mimi and papa gave you some money but we do this thing with money here because i'm trying to teach you that money comes from work, not Mimi and Papa. You're not going to get a trust fund that you're going to be able to live on the back of a yacht. So you're going to have to learn to work, puppy. And so I'm going to work with you on that. So, yes, they give you money, and that's nice, but it doesn't give you an exemption from feeding the dog. That's right. That's your chore.

Yeah. And so I'm going to play, honey, this is why I'm teaching you this. Honey, you're going to do this. It's not really optional. So nice of you that you're telling the why, you know. There you go. When Rachel was little, it was just no. Just shut up and do it.

Just do it. Oh, well. Now we're going to explain the why. You turned out. I love it. You turned out. This is so good. This is so good.

No, but really. And then it just becomes the point of disobedience that's that's the hard thing too because you do have kids like mine i'm like they're so different one is motivated to do it and to clean the playroom she's like do i get my dollar like she and the other one just basically the compliant one and the rebellious yes yes so you're going to deal with that anyway yeah oh by the way when you tell the rebellious one to do something and why and they don't do it and you just tell them they have to do it anyway, all they remember is that part. Maybe so. Just in case.

Maybe so. Just in case. But things do circle back. The middle child in my family now. You got you as a middle child for sure. And I'm really sorry. Your middle one is absolutely wonderful. She is a rock star.

She is a rock star. She is so sweet and so tough already. She's her mom made over. It's great. So, yeah, that's a good question because the boundary thing with grandparents is... Deloney and I were laughing about this on the air the other day. The Christmas one, I bought all the kids those big plastic cars and none of them were big enough to drive them yet. Yes, me too.

And the whole living room was full of them. And it was like I completely overdid it. I loved it. And nobody loved it but me. I was the only one that had fun. It's like, Dad, they're two. They can barely sit up on their own. They can't even get into it. They can't walk yet, but nobody loved it but me. I was the only one that had fun. It's like, Dad, they're two. They can barely sit up on their own. They can't even get into it.

They can't walk yet, but I got them a car. Yeah, so, yeah, you've got to have boundaries somewhere. And one of the questions Loni and I had was a new baby, the first grandbaby. Oh, yeah. And that's the one where you learn all of this stuff, interacting with your grown kids and your grandkids and how it's going to turn out. This is The Ramsey personality, best-selling author, is my co-host today. Open phones at 888-825-5225. Bill's in Kansas City.

Hey, Bill, what's up? Hey, Bill, how's it going? Hey, Bill. Hey, Dave. It's okay. I knew what you meant. It's all good. Yeah.

How can we help, sir? Hey, so I actually had a quick question for you. So I've actually moved cross-country a couple times now, and I finally found a city and a job that I like and was thinking about buying a house. I don't want to take out a mortgage. And so when I was taking inventory of what cash I had, I found out I had about $100,000 in a 529. That's kind of stuck there. For you?

Yeah, for me. Well, it was my parents' leftover. My parents funded those assets. For you to go to college. I went to a cheap school. That's correct. And you didn't use it? Why didn't you use it?

Well, I had a full scholarship, and I went to a cheap school. That's correct. And you didn't use it? Why didn't you use it? Well, I had a full scholarship, and I went to a cheap school. Great. When was that? When did you go to the cheap school? Six, seven years ago. Okay. What did the cheap school, how many dollars in scholarships did you get? In total, about $20,000.

Okay. Might not be worth the trouble. But here's what you can do. Okay? If you pull money out of a 529, there's a big penalty, as you know. Okay? Right. You can leave it in there, get married, have kids, use it for your kids.

Use it for your new wife. Okay. kids, use it for your kids. Use it for your new wife, whatever. Use it for your Ph.D., whatever. Or you could go back and get some professional tax advice, because I don't know what to do with something this old, but here's the rule on 529s. You can take out of a 529 whatever your scholarship money was equal to and have no penalties or taxes and so if you had twenty thousand dollars in scholarships you can pull twenty nine thousand twenty thousand

dollars out of your 529 and have no taxes or penalties on it okay but we got to go back in the years that you filed those tax returns or didn't file those tax returns or whatever and it you may have to file like an amended return to pull all that off i don't know how that part of work but in theory you could pull out how much you had in scholarships if it was last year it'd be real easy to do okay and bill do you have kids all right are you married got kids or anything no no no i'm single okay all right because the 529 can pass down you can pass it down later. You can just let it sit there. Yeah, I was going to say.

But you can't use it for the house without heavy penalties. Yeah. I think it's a 20% penalty plus taxes on all the growth. So you're going to get hammered. The $100,000 is going to turn into $60,000 by the time you pull it out if you use it for the house. I would not use it for that unless i could find scholarship money to apply against it do an amended return and get the money out that way that'd be the only way i could and then you would just leave it to roll over to

yeah his kids if he has kids in the future or yeah open phones at 888-825-5225 denise is with us denise is in indian. Hi, Denise. How are you? I'm well. How are you? Better than I deserve. What's up? That's what I thought. I am 57 years old.

I'm hoping to retire in five years. I'm a teacher, and my salary is $43,000 a year. I have retirement income from previous jobs, two pensions that equal $1,000 a month. And I have my three to six months saved up. I have six months saved up in my emergency fund. My question is, being this close to retirement, and I didn't expect to retire on my own, by the way, divorced about five years ago. So recovering from that. I've got my six months in, my job is stable. I was wondering if I should take three months of that salary and put it into mutual funds instead of letting the cash sit in the bank. Denise, do you have any other retirement? Any other money to your name for retirement?

I have a traditional IRA that's currently worth $14,000. And I have a 401k through my current job currently sitting at right over $3,000. And I've got 15% of my salary going into that. Okay. That's great. Let me add just one more thing. When I hit 65, I have the annuity that I got from the divorce that will start paying me $800 a month for the rest of my life. But it's between the 62 and 65 that I have to bridge.

Okay. And you live pretty frugally, obviously. Okay. Yes, I do. Yes. I would just put it in a straight. No debt other than my mortgage. Yeah.

I just put it in a straight mutual fund. I would not put it into a retirement account because that way if you run into a more than three-month emergency, you can still get at it, but we really aren't going to use it for that. We're really using it for long-term investing. But you're comfortable with the three-month side of the three to six months because you live frugally and you've got access to these other monies coming in and stability of income off of the old pensions and that kind of stuff, right? Right. Yeah. So that's fine to do.

You can't call it your emergency fund if you put it in mutual funds. That's just my rule. Right. Because I don't want people putting their emergency fund in mutual funds because the transmission goes out, the mutual fund's down, and then you'll go put it on a credit card because you don't want to cash out your investment while it's down and all this kind of crap starts to play. You use the wrong tool for the wrong job then. But the three months of emergency fund on the three- to six-month range in your situation is fine.

Because do you have kids at home, Denise? Anyone dependent upon? Yeah, so it's just, yeah, it's you at this point, which is, you're honestly the textbook. When we teach who should have three months and who should kind of gear more to that six months you are textbook three month i mean you it's you um not a ton of you know dependence there in the home income is stable it's not like you do freelance work and you have up and down months i mean all of that so yeah denise i think leaving three months in there is a great plan exactly and all the other indications and everything else you've described indicates you live very much within your means and very frugally the whole way you described your life since that yeah so you're going to do

just great you're going to do fine with that now the other thing is stay with the 15 going into retirement because that's going to be the big answer to your retirement problem not this extra three months going into a mutual fund this extra three months going into a mutual fund. This extra three months going into mutual funds, a fairly minor click on the dial overall. The big click on the dial was when you started putting 15% of your income away and we start working to get that house paid off. And, you know, when you hit 65, 70, you've got a paid-for house and you've built up a pretty good nest egg by then over this next 8 to 17 years or whatever we end up with here.

So, hey, thanks for the call. Open phones at 888-825-5225. Julia is in Colorado Springs. Hi, Julia. Welcome to the Ramsey Show. Hi, Mr. Ramsey. Thank you for taking my phone call. Sure.

What's up? Hi. I am a single parent working a part-time job and grateful to have that job after being unemployed for two and a half, excuse me, three years. And I want to thank you also for your show. It saved my life. So I really appreciate your show. Thank you. Thank you. I am calling to ask you, I did have to declare bankruptcy last year. I had three credit cards. They were out of control just so that I could put a roof over mine and my son's head and provide food, etc. Just through a series of events.

And I am trying to build up my credit. My car is 16 years old. I am looking at going to college this fall. And right now in the apartments that I live in, I'm hoping to move out. It's just not somewhere where I want to be. And I have to have a credit score again. You need to have learned your lesson with the bankruptcy

that credit is not your supply. Don't build up your credit. Don't go back in debt. It hasn't been a blessing to you. Learn your lesson. Don't build up your credit. That's the answer to your equation. Build up your cash.

Build up money. And we'll walk with you and help you rebuild. I've been right where you are and scared like you've been. So you hang on. I'll have Kelly pick up. We'll get you signed up for Financial Peace University in a year of Ramsey Plus. We will teach you how to handle money. You do not need to build your credit.

You need to build some wealth. And we'll show you how. Rachel Cruz, Ramsey Personality, is my co-host this hour. Open phones at 888-825-5225. You guys jump in. We'll talk about your life and your money. Michelle is with us in Scranton, Pennsylvania. Hi, Michelle. How are you?

Dave, I'm great. How are you? Dave, I'm great. How are you? Thank you for taking my call. Sure. What's up? Very exciting. My husband and I are on our baby step two. It's been amazing to encourage people out there.

If you're starting this journey at 58, it's not too late, and they can change your life. And the second most important part is that my husband wants to know what you think for investing. And would you advise sort of to hedge against inflation buying like some gold coins as part of your emergency fund? Okay. No, and I wouldn't suggest you buy stock in Home Depot either or Apple or Exxon. Why? Because the price is too volatile to use as an emergency fund. The purpose of the emergency fund is insurance, not investment. It's there for the rainy day. The umbrella is there for rain only.

It is not there to fight off bears. It's just for rain. That make sense? Yes, indeed. So let's say we have the emergency fund in cash. That's all you need. Maybe it's an extra. You can put it in the bank in a savings account if you want.

And Michelle, I'll go. Right. And I would go a step further, too, because you were wondering, you said my husband wanting to know about investing and then specifically in gold. But nowhere in the baby steps do we recommend people buy gold, period. So and neither single stocks either, like he was saying. But when it comes to investing in that time, still not suggest investing in commodities or anything like that. So in the market, yes, through good growth stock mutual funds or in a retirement vehicle like a Roth IRA, 401K, 403B. But in general, our piece of advice when it comes to investing is to stay away from gold. So let me kind of talk you through something, too, that's interesting.

So what this tells me, by the way, and the way you asked the question was that your husband's been reading crap on the Internet, okay, on gold sites. Because should I buy this, you you said as a hedge against inflation okay now let's talk about how that works here's the way you've heard of a hedge fund right now a hedge against something goes with the thing so the thing doesn't destroy you. Meaning that if you want to do a hedge against inflation, you would have to buy things that are incorporated in inflation. Inflation is the price of bread going up, the price of oil going up, the price of housing going up, the price of electricity going up, the price of living going up.

Gold is not one of those things. It does not follow inflation. There is no correlation between the price of gold and inflation. Zero. There's no correlation between the stock market going up and the stock market going down in gold. Zero. There is some loose correlations that really what gold prices core fear or greed when the marketplace deems that the world's falling apart oh god and all the conspiracy

theorists come out then the price of gold is going to go up but that's what drives the price of gold up not anything else and so if you really want to hedge against inflation, you buy real estate. You would buy stock in Exxon. You would buy stock in wheat farms. You would buy stock in things that go up in cost when inflation goes up, when the price of things goes up. The things. You'd buy stock in General Motors because the price of a car is going to go up. You'd buy stock in Bridgestone because the price of tires are going to go up. That's against inflation. gold coins are not the only place anybody says stuff like that is on their

stupid butt gold coin websites that's the only place that comes up that's how i know where he's getting the information because it's technically the wrong definition does that make sense yes so when gold is going up in price that's inflation right that's inflation does gold hold its value no not necessarily you go back and pull the gold you can just go online and pull up gold prices over 50 years and number one you're going to see about a five percent rate of return it's got a sucky rate of return and it's a freaking roller coaster at six flags to get there it's way up and way down just to get to an ad a boring average that's why i don't play in it because it's too freaking volatile it's too crazy a ride and i don't find any millionaires to say i

got rich buying gold coins none i find a lot of people that got poorer buying gold coins but i don't find any millionaires in our millionaire study that says i got rich buying gold coins so this is where it comes from yeah and there but there is a level because i just had a conversation with a friend about this recently there's like this level of security feeling like yeah but gold feels safe gold it feels like i don't know because you can actually tangibly touch it and see it whatever the case may be there's this element of like oh yeah we're gonna buy gold because it just feels it feels safer that's what they were saying and here's what here's the weird part of that is it's not when when is it safe when do you use gold coins when you use a bar of gold to buy something never okay i mean go back to a complete collapse of government and anarchy in the streets you know

what happens then the first type of economy that rises up is a barter-based economy so when katrina hits new orleans and wipes the freaking place off the map because all the levees broke and the whole place is laying down on the floor crying no one ran around with gold bars buying stuff but a can of gasoline some brand new blue jeans some work gloves some bullets you could trade that for anything for about six weeks down there right now you can trade two befores for just about anything in america okay with the price of lumber yeah but nobody's walking around with gold dust in their pockets. This is not the wild, wild west.

We have a medium of exchange, primarily electronic, but also these little green paper things with presidents' faces on them that is our medium of exchange. So this weird thing, all gold is safe, everything goes to gold when all hell breaks loose and the world falls apart. No, it doesn't. I mean, you walk baghdad after they kill saddam hussein nobody's walking around the streets there with little gold bars doing stuff immediately comes up with the next dictator's face on a piece of paper and this becomes your currency following a barter black

market barter economy which is what follows anarchy so you go from anarchy to stabilization and there's always a currency that pops up following and with the next government i mean when the civil war broke out the south they didn't run around with gold bars they printed up southern money which became worth nothing once they were defeated right we? We were defeated. I wasn't here, but I live here. But anyway, but I probably wasn't that old. But anyway, but the, you know, I mean, same thing.

I got these little pictures of Saddam Hussein on paper money that this guy in Special Forces brought me back. And three bullets from an AR, right? When he was on a thing there. And you know what that paper money's worth? Nothing. Because the people that supported it are worth nothing. It's gone. But there was never any

gold backing any of it up but so why does fear drive it because you see i mean like the joke is i feel like on cable news networks it's always gold commercial you know commercials selling gold and that's it's it's on this false premise that if everything goes to hell in a handbasket you're safe you're safe you're gonna be okay if you've got a gold bar in your safe. Yeah. Well, that's so much crap, it's unbelievable. It just doesn't work that way. You know, you cannot find a failed economy, consequently a failed government, that has completely collapsed where gold pops up as the standard.

It just doesn't. Not in the last 300 years. 500 years. You find me one time in history. You can study it. You can't, you know, Nazi Germany, Hitler takes over. It's on a failed economy, by the way. That's what put Hitler in place, okay?

And they had hyperinflation. Her question was about inflation. Hyperinflation. We'll borrow a load of money to buy a dadgum loaf of bread. So Hitler comes in to save the day. He's going to fix everything with a stimulus check, you know. So, and goes into power. That's what happened. But they never once went to a gold standard never once there was a lot of black market

stuff a lot of trading back and forth but never once did they do that so it's a fear-based thing and listen if you get your financial advice on the same channel where they sell walk-in bathtubs and snuggies you and your commercial breaks. They're selling you financial products, right, with Snuggies and walk-in bathtubs. That should be a clue right there. This is the Ramsey Show. Did you know The Ramsey Show is one of the most popular podcasts in the world? Subscribe or follow today wherever you listen to podcasts. podcast.