The Ramsey Show - App - How Do We Restructure Our Budget After the Pandemic? (Hour 1)

Episode Date: April 19, 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. Thank you for joining us. Ken Coleman, Ramsey personality, host of the Ken Coleman Show, where he talks about careers and jobs and finding the right kind of way to spend your day, is with me this hour to be our co-host. And that means we can talk about your jobs and your careers as well as your life, as well as your money. Phone number is at 888-825-5225. 888-825-5225, 888-825-5225.

Lisa is with us in Spokane, Washington, to start off this hour. Hey, Lisa, what's up? Hi, Dave. Thanks for taking my call. So here's the deal. My husband and I were in the process of building a house. We actually had the foundation go in last fall with construction due to resume this spring.

And then we found out last week that our construction budget went up 40%. So we've been on this financial plan to do this really intelligently. And now it's just gone off the rails. So we're going to put that on hold due to COVID. And I have this big chunk of money sitting in our savings account waiting to pay for this home that now we're going, it's not working for us, right? It's making, what, 1% in our savings account.

So we'd love to get your advice, to have some thoughts on whether to just park it in a savings account. We have a rental property that we owe some money on. We had sold our primary home, and I'm renting a home right now. Just could use some direction. Why did you stop building last fall? So we're building in a mountain environment up at a ski resort and oh you have to weather exactly so we put in but you didn't have you didn't have your materials all locked down by contract so we didn't i feel a little bit let down by our contractor honestly

but we did not know so we just found out literally last week he told us he gave he gave us a revised that's the difference in you sweet people and me i wouldn't be a little bit let down i'd be pissed off like 40 pissed off that was his job to lock this up i mean my gosh yeah i'm working with a contractor right now building a building or anticipating a building we're breaking ground on in two weeks, and I've been wearing them out about locking in everything because of the same stuff you're facing. These shortages on materials have gone through the roof, caused prices to go through the roof. We're going to see inflation come back, I'm afraid, because of it. So what is your guess on when you actually do build?

Wait, do you think that it will go back down? I mean, you don't know, right? Well, yeah, I don't know. Economists and weather forecasters are the only people that can be wrong and keep their jobs. Oh, and wait a minute, medical doctors predicting virus infection rates. Oh, there he did. He went and did it. They can be wrong and we keep their jobs too but

um uh but anyway the uh uh jeez i don't know i i do know i am pretty sure you're going to see something come back down there's a reason that steel and wood and lumber and now plywood right behind it are going through the roof as i understand it from the people we're working with in the business because i've got several construction projects underway myself and plywood is actually glue there's a glue shortage and that makes the plywood with and so we're going to see plywood probably triple in the next 90 days is what i'm hearing um and it's already high lumber packages are it's the factories were shut down and they were not producing uh inventory supply at the rate even at the rate that it was going there's not like there was this huge

building spike and the factories were operating at normal they weren't operating at all and then on top of that there was a good sized spike in building so as the spike slows down and the factories get back to capacity supply demand curve is going to drop these prices down steel is not going to stay where it is uh not not for not for five years it might for 24 months though i don't know i don't know on that but um so it so the answer to your question is how long do you think you're parking the money the longer you're going to park the money the more you're going to want to put some of it into something like an index fund and take a little bit of risk with it to get a little bit more money. So it could be two to three years.

Okay. I would love it if it wasn't. You emotionally are prepared for a two-year storm. Okay. I don't know that you're wrong on that. I'm curious, Dave. How much do you owe on-year storm. Okay. I don't know that you're wrong on that. I'm curious, Dave. How much do you owe on the rental property? Okay, so we owe $103,000 on the property,

and I have $180,000 sitting in the savings account. Okay. When you get ready to build, would you be willing to sell the rental if you had paid it off and needed the money? If I need to, we definitely would do that yeah because yeah i mean i mean that's one place that's a really safe place to get a three or four percent rate of return on that hundred grand pay that mortgage off okay ken's got a point that's where he's going i jumped the gun but yeah that's what you were thinking how much money is in savings for this building project

so i have a 180 in savings and we already have you know we own the land outright and we have no debt on the foundation is in and done so we already have you know a hundred thousand parked over there in concrete right now but that's that's neither here or there you're not going to tear that down so no uh yeah i i you know you could either do one of three things or some mix of them pay off the home the the rental and then be willing to sell it when you gear back up because you're gonna need the cash back out of it i'm not going to turn around borrow back on it uh if you do that that's kind of a point of no return on that the second thing is you could park some in an index

fund index funds are going to follow the market whatever it does uh i mean you could lose 10 of what you put in there over a two-year period of time it'd be highly unusual the number of times a two-year period in the stock market history is down 10 it's like two percent of the time or something it's almost never happens but it could i park stuff for short term like that if i can afford to lose the spread lose five or ten percent on it uh in an index fund and you might make ten percent instead of one percent on that portion and then some of it you park in just cash and that's your safety bellwether so i probably wouldn't do the rental and the index fund i'd do one or the other and leave the other half in just cash. Yeah. Okay.

So you got half of it real safe, half of it's either in that rental or into the index fund. That kind of thing. Hey, thanks for the call. Yeah, Ken, the next generation of elementary school kids are going to be taught FUCHI math. It's a whole new form of mathematics. Is that right? Yeah, it's where you just make crap up. Yeah, I like that. Well, can I just say this as a parent of three that went through Common Core?

I think somebody made that up, too. Well, that's just because you can't understand it. I don't know. Take a survey right now. I'm telling you, nobody knows what Common Core is. It's unbelievable. It's like you've got to go out. It's like having a perfectly neighbor gotcha comedian to this.

It's an uncommon core. There's no core. It's like saying, the front door works, but we're not going to go through the front door because of the way we do it now is we walk all the way around, jump over the fence, and come in the back door. That's common core. But it's more fun. For you.

I don't even know how to do it. That part of your brain works. I don't even know how to do it. I've never tried. This whole side of my head with math, Dave, it's dark. Exploded. No, there's nothing there. Oh, there's just nothing there.

It's empty. Doctors have found no wavelength. There's nothing in there. No activity at dark. No, there's nothing there. Oh, there's just nothing there. It's empty. Doctors have found no wavelength. There's nothing in there. No activity at all. No brain activity. It's almost like you're a medical doctor. Yes. Can't do math.

Oh, my gosh. This is The Ramsey Show. Are you feeling stuck and disengaged in your current job? Are you one of the millions of people who have been affected by the pandemic? If you're searching for a new job for any reason, the Get Hired livestream event on Tuesday, April 27th is for you. people who've been affected by the pandemic. If you're searching for a new job for any reason, the Get Hired live stream event on Tuesday, April the 27th is for you. At this one-night event, you'll learn how to get clear on what you do best, get qualified for the job you want, and get connected to job opportunities. You'll walk away knowing how to build a great resume that'll get you noticed. You'll know how to nail the interview process from application to offer.

And then you'll learn how to seal the deal after the interviews. It's time to take the next step toward doing work you love. No matter what your situation, there is hope. Join me on Tuesday, April the 27th to take control of your career and start working toward what you were born to do. Tickets start at just $20. Text HIRED to 33789 to learn more. Again, text HIRED to 33789. Ken Coleman Ramsey personality is my co-host today. He's host of the Ken Coleman Show on over 75 radio stations, Sirius XM, a big-time podcast and YouTube show where he answers questions about your career,

getting a job, getting in the job and in the career field that you love and are passionate about, and exactly how to execute and get that stuff done, real-world tactics like we're kind of known for around Ramsey. So again, 888-825-5225. Let's go next to Brandy in Wilmington, Delaware. Hi, Brandy. How are you? Hi, I'm great. How are you?

Better than I deserve. What's up? Good, good. So I wanted to see what you recommend. I've changed companies three times in the past year, and I have two 401ks still sitting with the company that I used to work for, and I wasn't sure what I should do with them, if I should roll them over or consider an IRA. What would you suggest?

I would roll them to an IRA with a SmartVestor Pro. They'll help you pick out some mutual funds. Always take your retirement with you by rolling it to an individual retirement account in good mutual funds if you have it available to take with you. And you do in these cases. The reason is, is that your new 401k at your new company probably is good. It probably has eight or ten decent good options. But again, if you will just put it in your name, A, you've got more control, more access. You'll watch it closer.

And, B, you have 8,000 mutual funds to choose from in an IRA, not just 12. And, obviously, with a field that wide, you can probably get something that will outperform or perform equally to your current 401K, but probably outperform it. Okay, perfect. That was what I thought you would say but just wanted to check so thank you so much for your time thank you so can the um what you don't want to do is you don't have to go back to your old company and talk about your options and moving stuff around and resetting things with an HR team or the payroll team at the old place. It's just awkward. Yeah, a little weird.

Hey, I know I left, but I've got some unfinished business. Oh, I need you to help me out here. Right. I need you to do some work for me. Yeah. I need you to fix this. Yeah. That's just, you just get into all kinds of issues there.

So, yeah. You just get into all kinds of issues there. So, yeah. Open phones at 888-825-5225. Renee is in San Jose. Hi, Renee. How are you? Good afternoon, Dave. Thank you for taking my call.

Sure. What's up? I'm 47 years old, and I need help finding motivation to work for another 13 years until I'm 60 years old. I'm going to try to preempt your questions. I have about $2.1 million in various 401ks and about $1.6 million in stocks and bonds and a $20k savings emergency fund in my bank. As I said, I'm 47 years old. I've never married, no kids. I support my parents who are in their 80s, and I have no debt. My three houses are paid off, and I've paid off my medical school loans.

I make about $200,000 a year as a doctor. And in the context of my parental caregiving responsibilities, I met with a financial advisor last year to ask how it would be financially if I had to stop working in order to care for my parents in the setting of COVID. And she said I could stop working and have enough money to support myself. Now, if I work another 13 years until I'm 60 years old, I'll get free health insurance for the rest of my life. And I can start receiving my pension at age 60 years instead of at age 65 years. What do you like about your work? What do you not like about it? Thank you for asking. I love my job.

I love seeing patients. I feel so blessed. It's such a privilege. If I had to take care of my mom, I don't know if I could work at the same time. I wouldn't want to put her in a nursing home because then I wouldn't be able to see her. You don't need motivation to work for 13 more years if you love everything about it. What is it you don't like?

What do I not like? Well, work is overwhelming these days in the setting of COVID. I always work more than my paid hours, and I accept that. If I truly didn't feel the need to work, I might go to medical, sorry, music school. I play the piano and the violin, and it's always been a dream of mine to apply to a music conservatory. Yeah, you know, Renee, here's the deal. You are a renaissance woman. Yeah. 3.7 million dollars, you're a doctor, and now you want to go to a music conservatory. Is there anything this woman can't do? You amazing yeah everybody's going oh i feel a little

bit worse about myself including me uh but renee you know dave's right you don't need motivation you need a mission and i think you've got to say it's okay i think you have to let yourself off the hook i i just i've heard these calls before there some sense of, and I don't want to use the word guilt in the normal sense that we use it, like you did something wrong, but is there some sort of guilt or shame that you have when you allow yourself to envision not being a doctor because you do love taking care of patients, but you've got this other side of you that you want to explore? Is there some sort of guilt or shame you're dealing with? I wouldn't call it guilt or shame.

What would you call it? Lost opportunity. Yeah. All right. So if in the next 13 years I develop arthritis or lose my hearing, will I regret not having taken the chance of getting my skills in place? The answer is yes. I think the answer is yes. That's what I place and trying. I think the answer is yes.

That's what I hear. What do you think the answer is? I think it's yes. You think you'll regret it? There's a high chance I would regret it. I mean, there are other outlets for music. It's just that our local orchestras and string quartets aren't meeting currently. All right, let me ask you this really quick. Let me ask you this. What kind of a doctor are you? General practice? Is there a specific type of medicine you do? I'm an OBGYN. I deliver babies. Okay, that's awesome.

So therein lies the extra hours, right? You just keep delivering babies. I think you're at a position, professionally and financially, where you could draw back a little bit and not work as much as you are and begin to pursue some of this. Cut your practice in half. I agree with that. And pursue and get the best of both worlds. Get the joy of delivering babies that you still have joy from and you love your patients. But you're just doing too much of it and it's got you boxed out of doing other things you want to do.

Cut your practice in half. You can afford to do whatever you want to do. If you're asking us mathematically, your financial advisor is right. You can quit your job and, you know, you can figure out a way to live on $3.7 million. I think you struggle through here. But I think you get too much joy and satisfaction from your medical career. I think you just structured it to where it's eating you alive. It's just eating into what you really want to do.

I think you do what Dave says, Renee. Here's why. Let's say you cut back It's just eating into what you really want to do. I think you do what Dave says, Renee. Here's why. Let's say you cut back on the practice. Guess what? There's always going to be more babies. So you can ramp up. This isn't a risky situation here. Dial in a little bit.

Are we going to have a COVID generation that are all born because people are at home? Renee's the one to ask. I think we're seeing that, aren't we, Renee? A baby boom? Actually, it's actually the opposite. People don't want to be around each other. There is some increased domestic violence, unfortunately. Yeah, I knew that.

Economically, due to job loss and uncertainty, health insurance loss, we've actually seen a decrease in the number of babies born per month. Yeah. Wow. Okay. So people are, yeah, wow. I never thought about it. I just. Wow. Okay. So people are, yeah, wow. I never thought about it. I just, wow.

Okay. So anyway, yes, I would pull back. I would give you permission to cut your practice roughly in half or more. The only reason I wouldn't quit completely is I also think you'll regret that because I think you get a level of joy out of this. Yes. I agree with that. Thank you for that. The three of us are on the same page. So I used to make over 300K,

which was my base pay. And I have given up operating, which is doing surgery on women. And as of last year, I did give up labor and delivery. So I'm no longer on call on weekends, nights and holidays. So I went from full time, is, in doctor's world, 80 to 90 hours per week, to part-time, which is about 50 to 60 hours per week. And that gave you some relief, but you're still going hard. You're still going hard. And so I don't know what portion of the practice, I don't know how to parse out an obese practice,

but I would parse it out in some way to where you cut back to, I don't know, whatever you want to call it, 30 hours or whatever. I would keep my toe in that water, though. I don't think I would walk away cold, and I don't think you have to to explore the music stuff because, as you said, some of the music is coming back a little slower than other areas of the culture. And so I got lots of friends in the music business here in Nashville, and they were kind of wishing that it was going better. A lot of them are struggling.

So, yeah, this is The Ramsey personality, is my co-host today in the lobby of Ramsey Solutions on the Debt Free Stage. Griffin and Sally are with us. Hey, guys. How are you? Hey, what's going on? Welcome. Where do you guys live? We're from Milwaukee, Wisconsin.

Wonderful. Yeah. Welcome to Nashville. And all the way here to do a Debt Free Scream. Yes, sir. How much have you paid off? $148,015. Whoa!

That's pretty rowdy. Your range of income during that time? We started out right around $120,000 and we finished out at $180,000. Wow. Nice incomes. What do you all do for a living? Well, you can start. So I'm a wedding photographer and I was a nurse during our debt payoff as well.

Okay. And then I'm a computer engineer. Okay. So you were both working a lot. Yeah. Yes. Well, maybe not so much on the wedding photographer in 2020. Well, actually a lot of people think that, but it wasn't too bad. I think we did 28 or 30 weddings. Wow. Yeah. Not too many people afraid to still have their wedding. Yeah. That's interesting okay well some of the crowd shots were smaller yeah we did some weddings there were 10 people yeah 20 people 30 people still wanted pictures of course yes that's great a lot of people in the wedding business quit

that's not being reported that's breaking news right there on the stage there's a lot of people reporting that they went out of business that's what i'med. It's not being reported that she's winning. That's fantastic. And we did everything in our power to work with people and reschedule things. Yeah. Good for you. What kind of debt was the $148,000? It was all my private engineering school that got my job, yeah. Wow.

So it was all your fault. Yeah, that's how it started. But we're high school sweethearts, so I was locked in. So you knew what you were getting into, huh? Yes. All right. That's very cool. Very cool. Well, congratulations. Very good. So what put you on this journey 15 months ago? You can start. So about 15 months ago, well, not really 15 months ago, because we paid off our debt in October, right? And so in July of 2019, we got married. We were head over heels in love, had no idea what we had coming for us.

Griffin is the nerd, and I'm the free spirit, so he did all the calculations, realized we had a lot of debt, and we had our first fight. And we were devastated, realizing what situation we were in, what this meant for our future, that this was going to hold us back in a way we didn't expect. And so we really both just looked at each other and felt hopeless. Like this is not what we imagined getting married would feel like. But as much of a burden as it felt like, we knew that hard work would get us out of it. And we depended on our brother's love of Dave Ramsey, Luke over here, to get us through it.

And so we trusted God with it. We tithed. We honored him in the process. And we just got to work. And we booked as many weddings as we could. I found another job. And Griffin worked his butt off in the process to help me. So David said, there's a way

out you got to do this hard stuff yes it was not and introduced you to us yes okay all right very cool way to go david good job luke it's luke i'm sorry where did i get david okay i made that up okay uh my brain just left but yeah so wow and you did that did you sell stuff i mean you must have lived on nothing so it was interesting we um when we started we knew that we were going to have to cut our expenses as much as possible we started cutting each other's hair um we learned how to cut our groceries down to almost nothing uh we ate a lot of beans and cottage cheese uh our meals weren't fancy we never went out to eat. We didn't travel. If we were traveling, it was for a wedding, and that was our traveling experiences.

Weddings became vacation. Somebody else's wedding. Yeah, exactly. Yes. And what else did we do? After we did the first budget, it was red and it was negative. And I said, looks like we got to do a little bit more. And so we dug a little bit deeper, found some extra areas that we were trying to hold on to. And that's how it all started.

What were the last couple of areas you let go of that were hard to let go of? I found it really hard to not do impulsive experiences. Like with our friends, we had to say no to going out and doing something fun on the spur of the moment kind of thing. It was really hard to say, got to go home, get to bed, because we got work to do. And we got a lot of weird looks from people. Why are you working so much? That was hard. But it was worth it.

And all the sacrifices are what got us to this point. Sally, I want to dial in on that sacrifice piece. As a nurse and a wedding photographer, how many hours were you pulling in a given week so um i was working 40 hours a week uh as my nursing job and then we would travel on the weekends um uh it just depended sometimes we were going out of state so we would leave on fridays do the weddings on saturday sometimes friday wedding saturday weddings and sunday weddings and then we would come home griffin would do all the cooking and cleaning. He was a huge support. He went to every wedding with me, carried my bag,

made my job as easy as possible. And we really worked as a team. So I can't take all the credit, but we did work a lot. And it looks like I worked more, but really he was the motivator and the encourager. And he did the small things that I wanted to be doing but I realized that those would come later and now I'm at that point where I get to clean the house and cook and do the things I wanted to be doing are you still cutting each other's hair uh yeah well Griffin actually decided to grow his hair out yeah that's one way of saving money right there in a while okay I think I'll try it the last time I got my hair cut at a haircut place was before our wedding two years ago. So ever since then, she's either cut her or it hasn't gotten cut.

Yeah. Yeah. Fun. Fun, fun. How long have y'all been married? Almost two years in July. Wow. Okay, so this whole thing has encompassed your married life just about.

Yes, it was an interesting way to start for sure. Yeah, the high school sweetheart thing and then all the romantic bubble has burst with that first big fight and you got to go, oh, crud, there's reality at our doorstep. We've got to deal with this. Exactly. Fifteen months. I mean, you guys were on fire. Thank you.

This is very well done. Okay, what do you tell people the secret to getting out of debt is? So this is kind of right after we started. Two months, we did our first budget, realized having more, and we realized that we weren't tithing. And there was this big battle of we had to already trim our budget, and we didn't know, is this going to slow us down by how many months? So in December of 2019, we decided to start tithing. And the next day, Sally got the nursing job she just talked about.

She got an interview, and then three more wedding jobs came in the next day. And we could see the obedience that God was blessing us for right then and there. We just kept tithing and we got done even quicker than we expected. God is good and He's faithful. Test me in this, says the Lord. See if I will not throw open for you a window

of heaven and pour out blessings that you cannot contain. That's amazing. I think our original goal was two years. Our original goal was a month ago was when we were supposed to end. And then the more we tied, I feel like the more jobs and the better our situation got. And by the way, you got the jobs, you took the jobs, and you worked the jobs. Exactly, yes. Yeah, like a thousand hours.

I mean, extra. Wow, you just poured it on. Great place to go when you're broke to work. You guys are amazing. Thank you. You're on fire. Thank you. Okay, so now you're kind of through the big push.

Now you've got to finish the emergency fund and get on with the baby step four, start your retirement, all that kind of stuff. Probably already there now. And so you slow down a little, I guess, right? Yeah, so I quit my nursing job, which was a huge blessing. Because now I can just kind of not be the bad kind of normal but have a more relaxed lifestyle and and stop and enjoy things a little bit well actually get some sleep yeah yeah yeah i relax breathe a little bit yeah yeah well congratulations thank you so much what's the first big thing you want to do now that you're the other side of this well right after we

got our debt we obviously did our emergency fund we got our retirement started and then we kind of went straight to babysat seven we didn't have have our emergency fund, we got our retirement started, and then we kind of went straight to Baby Step 7. We didn't have any kids yet, and we didn't have a house. We lived in an apartment. But now, we're going back to Baby Step 5. Oh! Uh-oh! Hey!

Woo-hoo! I love it. A onesie. Yeah. With Baby Step 5 on it. So, when are you due? September. Yay! Oh, my goodness. About a year after we paid off our are you due? September. Yay.

Oh, my goodness. About a year after we paid off our debt. That's awesome. Yeah. I got goosebumps everywhere. That's a way to reveal it right there. Thank you. That's a great baby reveal.

It really is. That's fun. Well, congratulations. Thank you so much. That is so awesome. Very, very cool. What a great way to start out your lives. And if you guys can plow through something like this together, you can do anything together.

Yes. And so it knits you together in a way that nothing else will. And so just amazing. So well done. Good job, babe. All right. Griffin and Sally from Milwaukee. $148,000 paid off in 15 months, making $120,000 to $180,000.

It's all about the hours, baby. Count it down. Let's hear a the hours, baby. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! Yeah! Woo-hoo-hoo-hoo! That is fun.

I love it. Wow. This is The Ramsey personality, is my co-host today. This is the Ramsey Show. Open phones at 888-825-5225. Connor is with us. Connor's in Minneapolis. Hi, Connor.

Welcome to the Ramsey Show. Hey, Dave. Hey, Ken. Thanks for taking my call. Sure. What's up? So, hoping you guys can resolve a debate between my wife and I on how much you spend on a car. So, a little background on us, we're on DB Steps 456.

We have no debt other than our house and no kids yet. Sorry, I'm a little nervous. That's okay, what's your household income? What's your household income? Yep, $200,000. And what's your household income what's your household income yep uh 200 000 and what's the other car worth um about 17 okay and what other toys do you have with motors in them or wheels on them uh just one other car that is not worth a lot that is falling apart. So no boats or sea-dos or snowmobiles or whatever? No, nothing like that.

And we have currently $86,000 cash on hand. Okay. So what does she want to spend on the car? She wants to spend $5,000 to $6,000. Not nearly enough. That's what I was thinking. That's ridiculous. I was i would say 20 25 20 25 you make 200 000 a year you have no debt you have 86 000 in the bank you need to buy your wife a good car not new but a really nice one yearyear-old or two-year-old car. You guys are being cheapskates. Well, there is a little catch, Dave.

The one piece being that in the next one to two years, I'm planning to go back to get my MBA. And my wife is a teacher, so she only brings home about 42 a year. So don't quit your job. Do your MBA as an executive program at night. Why would you give up this fabulous income to get an MBA? I think long term,

it's probably the right move. So I went to school for history and political science and ended up falling into a really good job. I don't. I think you make too much money to quit your job to go get an MBA. I think you get your executive MBA at night. It's the same MBA, dude. think you get your executive nba at night it's the same nba dude

and you keep your job yeah what do you make uh 156 last year so you're going to pay 156 thousand dollars a year for two years to go get an nba that's dumber than crap yeah where are you going what you fell into something where are you where are you headed with this mba you think it's going to take you somewhere where so um right now i work for a healthcare it company um and kind of the second caveat with this is that i'm going to be rolling into a new job in the next year here my remote work i work for a company based out of wisconsin that works ending so i'll be going to a new job i don't the income's not going to drop to nothing but it should be around the same area given my experience and skills and kind of the references and that work's ending, so I'll be going to a new job. The income's not going to drop to nothing, but it should be around the same area,

given my experience and skills and kind of the references I have. Future, though, I'd like to work my way up to, like, a COO or CEO of a hospital. Yeah, I didn't say don't get an MBA. I said don't pay $300,000 for it. Yeah, do it as you go. Okay. I mean, really? Opportunity cost on your money is one of the things they'll teach you while you're getting your MBA. You're giving up $150,000 a year for two years of income to get an MBA when you could do it at night in an executive program.

And there's tons of high-quality executive MBAs all over the nation that you can get into and they're about 20 grand and go get your MBA. MBA is a wonderful field of study. Is it necessary to be a COO? No, but it's helpful. It's good. I would suggest it. I don't have one, but I would suggest you get one. I got several of them work for me.

And so, but, you know, but dude, you're paying too much. Anyway, side issue. So that changes the car discussion, and you're right. That is a piece of context around the car. On a teacher's salary, do we do that? Are we going to cut our income by $150,000? So it brings up a larger discussion, I think. So I think you go by 20.

If you want my advice, if I was your dad, I would tell you, your old uncle that's kind of grouchy and speaks too plainly, I would say, I love you, man, and don't pay $300,000 for an MBA. Do it at night. Go get your MBA. Live your life. Have your career field that you like. It's probably table stakes to some degree in the world that you're in,

but it is not necessary for you to give up that income to get it, and that means that you've got $86,000 piled up to buy your wife a $20,000 car. Yeah, I absolutely agree. Pay as you go on the MBA and learn how to follow. You're going to get opportunities to lead. That MBA is going to be real nice. It's going to look really good. By the way, if you're working for somebody, a lot of them will pay for it.

Yes, sir, they will. Absolutely. If they want to invest in you, a great company wants you to get that, there's no hurry for you to go get that MBA. There's just no hurry. He's changing jobs. I'd like him to get in and get settled. Let's see what the latter looks like in this new company.

Let's have that discussion. But, you know, I've not used this phrase before, but it is the phrase. It is the right phrase. We have told too many people and too many people have believed that a degree of a certain level, a degree period, or a degree from a prestigious university is table stakes to be successful. It's not. It's not at all. You get to play at the table, and it's how you play the hand. And does it give you an advantage?

In some cases, it does. Having the knowledge base is a good thing. But there is absolutely not a single piece of research that says where you went to school caused you to be successful. As a matter of fact, there's contrary research. Absolutely. Let's give you a good old-fashioned football recruiting analogy. You can have a five-star rating or a four-star rating from a recruitment organization, and you can get recruited based on that.

But you better go, and you better show up, and if you don't play well, you won't get on the field. I don't care if you're five-star or not. If you don't play well, if you don't show up in practice and do what it takes to get a chance to play on Saturday, you won't play. I don't care what your rating is, and that's the NBA. It's nice.

It says that you've gone and done something, but the reality is, Dave, you're right. You've got to show up. You've got to be humble. You're still going to have to work your way up the ladder by being a good follower, learning how to lead, and then applying that wonderful knowledge to real-life leadership. And that comes through delivering results. Yeah, but the NBA is not Willy Wonka's golden ticket.

It is not. It is not going to get you in the ball, Cinderella. Yeah. You know, what gets you in the ball is, you know, you... Results. Yeah. Show me. Well, you actually do stuff. That's right. to get you in the ball cinderella yeah uh you know what gets you in the ball is you know you results yeah well you you actually do stuff that's right now it can it get you noticed sure you know can it get you a side-eyed glance yes it can i like that but it doesn't but it doesn't it does not cause you to get let me just tell you we're hiring for you know six figure positions every day here

we're hiring 300 000 people at ramsey 300. 300,000. 300 people this year. God help me. 300 is enough at Ramsey this year. And several, many, many of them are business leadership roles, tech leadership roles that are six-figure. And not a single one of them will be hired because of where they went to school. That's true. Not one. Not a single one of them will be hired because of their career level

or be turned down i mean because of their education level or be turned down because their education level the only thing we are concerned about is do you have the tools to do the freaking job you know i had a guy working for me years ago said you know a guy with a million degrees as i've got usually makes me more degrees than a thermometer i mean you know he's like a guy with a million degrees as i've got makes a lot makes x number of dollars and i said well honey you're working for a small business and around here your raise is effective when you are that's good it's my favorite line that's so good but that's you know and didn't make him happy he didn't work anymore but the um you know because he wanted to be paid for because he went to school. No, you get paid for doing crap.

That's it. That's all it is. Scoreboard. Show me the scoreboard. You have to go kill something, drag it home. So in his case, the MBA is a good thing. Good thing. Is it table stakes?

Does it mean you cannot succeed? No. Would it probably open some doors? Yes. Would the knowledge base you get definitely open some doors and give you the ability at a COO level to function in health care. Yes. And he's in the financial situation where he can cash flow his way through it. Yep.

And they might pay for it. Absolutely. I mean, health care is big on education. So, you know, there's a lot of different ways to play this, but what I want to take off the table for him and for everyone else is that it is required, or it is a golden guaranteed ticket certificate. You will succeed because you have it. No. Overeducated, broke people are everywhere. Yeah.

They're everywhere. They're all over our culture, and they're arrogant as crap. Oh, yeah. But they're broke. Here's the line, Dave. A degree is not a guarantee. That simple. Touch crap. Oh, yeah. But they're broke. Here's the line, Dave. A degree is not a guarantee. That simple. Touchdown.

There you go. Not a guarantee. It might get you a side-eyed glance across the ballroom. But that's it, Cinderella. You've got to make tackles. You've got to block. You've got to catch the ball. Too many metaphors mixing up here.

I know. Cinderella's making tackles now. I don't know. This ain't good, buddy. This is the Ramsey Show. Hey, it's Kelly, associate producer for The Ramsey Show. This episode is over, but if you heard about an event, product, or service and didn't have a chance to write it down, don't worry. We list everything you've heard about during this episode in the podcast show notes section or head to theramseyshow.com.

Thanks for listening.