The Ramsey Show - App - How to Budget for a Wedding (Hour 1)

Episode Date: February 4, 2020

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us, America. It's a free call anywhere in North America. The phone number is 888-825-5225. It is a free call, and some say the advice is worth exactly what you pay for it. All right, Caleb is with us to start off this hour in Idaho.

Hey, Caleb, how are you? I'm good, Dave. How are you? Better than I deserve. What's up? So I'm calling for a question regarding my mom. She is 67, and she's just recently retired, but she has a small nest egg. She has about80,000 in her retirement account. So obviously, Social Security is going to supplement a significant part of her income. I guess I'm wondering, she hasn't rolled that over to an IRA from her 403B from when she was nursing um should those be invested in the same type of mutual funds that

you typically recommend to maximize their how long they will last her yeah how old is she again 67 67 i apologize 68 okay um well the you know typically the four times yes you ought to move it to mutual funds in an IRA. She ought to do a rollover into an IRA. She's got more control over it. She'll have better options to pick from, have her sit down with you with a smart investor pro in your area. Click smart investor at Dave Ramsey.com to find a list of those and get somebody in your corner that can teach her and you what your options are. Now, we typically say for everyone, put your mutual funds across four,

invest your mutual funds in retirement across four types of mutual funds, growth, growth and income, aggressive growth, and international. Of those four, aggressive growth is the most volatile. Okay? Okay. So if she wants to calm it down because she is square in the middle of retirement and she's not just riding this for growth, she really needs it to sit there pretty stable, she could substitute for the aggressive growth a growth and income or a balanced fund. I'm sorry, a balanced fund.

And a balanced fund is a growth and income's calmer little brother. Okay? And so we just took out. And you still keep them divided 25 each? Yeah. Essentially 25% each? Exactly. Okay.

And sometimes people will do that just to calm things down a little bit in the portfolio because that aggressive growth is going to go way up or way down depending on what the market's doing. It's a super fast roller coaster. And that'll just calm things down. And, you know, she hasn't got a ton of money, and she's 67, so we'll calm that portfolio down. Now, sometimes people in the financial planning world tell people that,

you know, once you're 65, you're basically dead, and so you need to move everything into bonds and cash, which is a really bad idea. Yeah, that's a bad idea because the bond market sucks right now, number one. But number two, you know, that portfolio won't even keep up with inflation, much less give you a rate of return to live on and if you're 65 the probability is you got 20 25 years statistically until you're you know your 80s before you you know before you pass away statistically speaking and so that's a long time to have that money sit basically dormant so i don't do that um my portfolio is invested the first set of the four i told you about and i'm 60 this year so um but but you know so i'm i'm real comfortable with whatever the market's going to do i'll be okay but the more you've got in investments the

more you are going to be comfortable that you're going to be okay and so you know that's that changes everything when you only got 80 000 bucks you got to be okay. And so, you know, that changes everything. When you only got $80,000, you got to be even, you know, much more careful with it. All right. Up next is going to be Emily in Tennessee. Hi, Emily. How are you? Hey, Dave.

I'm doing well. How are you? Better than I deserve. What's up? Well, I have had my oh crap moment. I am 24 years old, single, no children. I make about $35,000 a year gross, net about $31,000. And I have $109,000 in student loan debt and about $1,300 in credit card debt.

So I'm on baby step two starting today, actually. And I am scaling things way, way back. But I kind of have two things here. Number one, I'm just a little overwhelmed, a little freaked out by the situation that I'm realizing I've gotten myself into. And then also on top of that, I found out yesterday that when my grandfather passed away about 14 years ago, he left me a rifle that today is worth about $8,000 to $20,000, somewhere in there, estimated. And if I hang on to it another 20 years, it'll be worth upwards of $50,000,

so says the friend that helped me appraise it. So how long is this going to take? Am I going to be okay? And what do I do about this gun? Okay. Well, I would not keep the gun as an investment. I would keep it as an heirloom. Okay.

And so let's not – it doesn't fix anything today to sell it. It doesn't fix your situation. If it was worth $500,000, you know, we'd have to talk about it, right? But it's probably an $8,000 or $10,000 gun you got a hundred thousand dollar problem what is your degree in uh it is in social work so i committed the cardinal sin of going to a high dollar university for a low-paying degree and i have been kicking myself for it since the day I got the diploma. Have you got a master's or an undergrad? I do, and I'm awaiting the date that I can take my licensure exam. I'm waiting to hear back from the Department of Health. Okay.

Well, that'll be helpful. You can open up and do some private casework stuff and get your income up considerably. Yeah, you're not relegated to a thirty five thousand dollar income but yeah i've been interviewing this week for another i mean i'm willing to take on even another full-time position at this point i just want to get this done yeah and it is a ratio of income to debt we call it the shovel that you've got to dig out with versus the hole you're in the shovel to hole ratio and you got a you got a pretty good size hole here in a medium to small shovel and

so you're on the right track to do things to get your income up and but here's the thing let's pretend how old you say 24 24 25 in a couple days so let. So let's pretend that over the next two years you doubled your income with extra work, side work, private case work, finishing getting your license, all that kind of stuff. Okay? And you kept living like you're living. Mm-hmm. If you put $35,000 a year on $100,000, in three years you're done. Okay. So I think you'll be out of debt in three years you're done. Okay. So I think you'll be out of debt by the time you're 30.

Okay. I think you'll be out of debt probably before then. But I think you're going to make it. And you've just got to, for the first time in this career, decisions of yours start making decisions based on how much money you make. And you're going to have to pick some places where you can make some money and you can expand your horizons and you can stretch your budget up. Because if you get that income up, it moves the needle really fast on $100,000 here.

So you can do it. You can do it. And we'll be here to walk with you, kiddo. This is The Dave Ramsey Show. I love talking about companies that know how to do business right. You've heard of Grip6 belts, right? Well, if you haven't, it's the only belt you can get online with no holes, no flap, and no bulk. I'm talking weightless.

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Tyler is in California. Hi, Tyler. How are you? Good. How about yourself? Better than I deserve. What's up? So my fiance and I are getting married towards the end of this year, and her parents very graciously gifted us $10,000 to kind of start our lives and do what we please with. We're currently

in baby step two and just kind of wanted to hear it out of your mouth or, you know, hear your advice on what we should do with that 10,000, either throw it all directly at the loans or, you know, something else with it. Okay. Who's paying for the wedding? We were, so they're just giving us that money basically use as we please. We plan on paying for the wedding ourselves as little as possible, as cheap as possible. And so we're saving up for that now as well. Yeah. So what's the budget for the wedding?

What do you plan to spend on the wedding? No more than 5,000. Okay. What I would do with the 10,000, have they already given her the $10,000? Not yet. Not yet. They just, they offered it to us and they're're gonna be giving it to us in the next couple weeks or so okay good i would set 5 000 aside in a separate account for your wedding budget and a wedding

is like any other project except this one's full of stress more than others right and drama and all those things so the wedding budget needs a real budget. You're managing a project here. So you've got the venue, you've got the reception, the dress, the photographer, whatever it is you're going to spend, you know, you need to budget that out and not just go, well, we've got $5,000. No, how much of the five is going to go to the dress? How much of the five is going to the reception? How much of the five is going to go to the rest? How much of the five is going to the reception? How much of the five is going to the venue and the location?

And so on, to where every dollar is mapped out as if this was a business transaction, okay? If $5,000 is your budget, set $5,000 aside of it for that. The other $5,000 would go on your fiancé's debt. You are not married yet, so you do not pay debts together after you're married you would pay debts together how much debt does your fiance have so it's actually she has none it's actually all my debt okay i would not let her pay any of your debt with her parents money until you're married right and then after you're married and you come home from the honeymoon, now we're married, now it's ours,

but until then you are two separate individuals legally and, for that matter, emotionally and relationally. But how much debt do you have? I have about $80,000 right now. Okay. And how much money do you have? I have about 80,000 right now. Okay. And what, how much money do you make? Right now I make about 26. I'm, I just had the interview for promotion, which will bump me up to about 36. If I do get that promotion, I'll know in the next couple of weeks. Cool. How much does she make? She makes about 35 right now. Okay. So when you get married, you'll be making

somewhere in the $70,000 range with an $80,000 in debt and $5,000 head start on that debt when you come home from the honeymoon. The other five will go to the wedding. Is that a plan? Yeah, it sounds like a plan. Do you think for the extra five, where should she store that for now? Should we put it in some kind of compound interest account? It's not going to earn anything between now and the fall. I mean, you can just put it in a savings account. You make 1% on it or something. Otherwise, you're going to put it at risk, and you could end up losing some of it,

and it's not worth all that. All we're doing is just parking it. It's a glorified shoebox or a glorified fruit jar that you put the cookie jar that you put the money in. So if you make a little bit of money on it, that's fine, but you're not going to really get rich on it between now and fall. And the kind of risk you would have to take to make good money on it is not worth it.

So I wouldn't do that. Hey, thanks for the call. Alan's with us in California. Hey, Alan, welcome to the Dave Ramsey Show show thank you dave how you doing better than i deserve what's up all right dave so um last month i discovered you and i've been going into the baby steps now i'm on baby step two trying to pay off my debt and trying to fix all the mistakes that I, stupid mistakes that I made back in my twenties. Okay, cool. So, uh, my question is about my student loan. Now I have three different loans. Um, one of them is still active and two of them went into, uh, charge off. So they did the charge off and, um, I got a bill from the irs thing i just need to pay

um the taxes off of it which is uh seven thousand wait a minute wait a minute these are not federally insured student loans these are private student loans yeah okay so it's just a regular debt what kind of a school did you go to? I went to a private school, art school. Art school, okay. And so it was a Vo-Tech type of a situation, and you just borrowed the money through them, but it's not a federally insured student loan, and then that loan has gone bad, and they have charged it off, and thes has sent you a bill okay the irs does not determine

the active active uh state of the debt they simply sent you a bill because this company has written it off that does not mean you are not liable that does not release you from liability all right so do i settle those yes what do i do yes like um do i settle for lower oh definitely you don't have any money right huh you don't have any money so you would have to settle for lower right um well yeah i'm just i'm just working paying off the debts that i do have now so what i would do is get rid of the active debts first. Work your debt snowball on those. List them smallest to largest.

And then when you get down to these that have been charged off, pile up some money and make them a lump sum offer at that point. Now, what is the balance on one of the charge-offs? Give me an example of one of them. $35,000 on one and $15,000 on another. Okay. I'd start with the $15,000, and I'd save up $1,500 to $2,000 and offer them $0.10, $0.20 on the dollar cash as a settlement in full. If they have completely written these loans off and forgotten them, they might actually take that that will clear

the account oh by the way then those taxes will be due because debt forgiveness is a taxable event and so taxes on the difference will be due so let's say for instance you had a fifteen thousand dollar loan they agreed to take two thousand dollars you send them two thousand dollars after you get that in writing and they write the loan off and accept that as a settlement in full. 15 minus 2 is 13,000 is now taxable income. So you will pay taxes on $13,000 as if you made a bonus for that much after that. And so that's what I would, you know, that's how you're going to work through it. But do the little one first after you've cleared off all your active debts

and then move on to your largest one. So good question. Well done, man. You're getting after it. Good job. Kevin is with us in Minnesota. Hi, Kevin. Welcome to the Dave Ramsey Show.

Hi, Dave. How are you? Better than I deserve. What's up? So I have a question regarding a vehicle that I'd like to purchase. I'll go ahead and provide some information to you. I'm 17, self-employed, and this year I'm projecting to make about $80,000 to $90,000. Doing what?

I'm currently in, I'm a woodworker. I sell all kinds of different things online and in person at craft shows. Wow, you're doing great. Thank you. So I'm currently in baby step 3B. I have no debt of any kind and I have $20,000 in an emergency fund. This year I plan on saving $50,000 towards baby step 3B and I should be able to save an additional $20,000 to $30,000 to that before the end of the year. My goodness. My question is about a purchase I intend to make on a vehicle. I currently own a 2009 F-150 that has rusted out cap corners and rocker panels,

as well as other minor body damage. However, for the most part, it's mechanically sound. I'd like to purchase something that has lower mileage and is in better condition overall. I'm having trouble deciding whether I should buy something similar to what I have now or upgrade and truck. How much do you want to spend? If you upgrade, what would you spend? Probably $9,000 to $11,000 total. Absolutely do that. You're a stud, man.

You're killing it. Yeah, you've got money coming out your ears. You're completely organized. You've got a system. You're working the plan. You save up and pay cash for it. stud man you're killing it yeah you got all you got money coming out your ears you completely organized you got a system you're working the plan you save up pay cash for it yeah i'd move up that much in truck like an 80 grand is 17 years old very impressive this is the day ramsey show When it comes to dealing with ID theft, most people still think that credit monitoring or prevention plans offer the best protection. Wrong.

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That's why Zander's id theft plan is the only one i've ever recommended and used for my family and my team they use smart technology to reduce your risk and they have a recovery team that takes over all the work if you do become a victim plus kids are covered for free on their family plan go to zander.com or call 800-356-4282. It really is the smarter, more affordable way to protect yourself. In the lobby of Ramsey Solutions on the debt-free stage, one of our own team members, one of our own family members, Russ and Joni Sellers join us. Russ is a national account manager, works with consumer products. A lot of the books that you guys find in bookstores, it's Russ's fault that they're there. So he's been with us a couple of years doing a great job and today doing a debt-free scream.

Welcome, brother. Thank you. Congratulations, you two. Thank you. So you've been here two years. So how much debt have you paid off? $203,000. Good Lord.

And how long did that take? Three years and seven months so you're working on it before you came here yes okay and i'm not going to ask income because all your all your buddies are standing around here the rest of your team members and that kind of stuff so it wouldn't be fair so what kind of debt was this uh this was our house you paid off your house weird people on my team i love it baby what's the house worth um it is now three hundred and ten thousand dollars y'all are doing good how's it feel to have a paid for house joni just awesome is it johnny or joni joni joni i'll make sure i get this right i'll mess it up for 20 minutes here okay good yeah so it's yours it is it's yours have you ever have you ever thought

about having a paid for house this is incredible no i didn't think it was possible three years and seven months so a year and seven months before you came here 18 months roughly before you came on board yeah you guys started the process of knocking the house out tell me that tell tell us the story how that happened well we were working with a smart investor pro and it was in January of 2016. He invited us to a book launch party, retire-inspired. We had never even heard of Chris Hogan, but we were intrigued, and we came to the book signing and met Chris, started reading the book that night, and finished it within a week, had Joni read it,

and it was the wake-up call that we needed. And you're in the book business. I mean, you know, those of us that are in the book business, we've got books everywhere. Yes. There's always a book being set on our desk. Somebody send me their book. Send me their book. So what made you decide to actually read this one?

Because I throw a lot of them away. Well, we highly respect you, and if you said Chris Hogan was the man. So, you know, we'd been through Financial Peace University years ago, but life happened. Braces, colleges, grandkids, weddings, and we just got distracted. And this book was the wake-up call that we needed. So, Joni, the book guy goes, picks up a book at a play, you know, reads it all night. What did you say? I said, let's do it.

I was so excited because I knew that it was what we needed at the time yeah so didn't have to talk either one of you into it it just needed a plan and it's a little bit of encouragement to get on the horse yeah go go go go go go go go and you don't have a house payment how old are you two um i'm 60 and she's 62 and your house is paid for. I know. I love it. Wow, that's so awesome, guys. So awesome. Most people never make it. You know, you asked a question on the show once, and it was something like, what has to be true that's not true today to get to your financial goals?

And that question kept me up at night. And the only way we could answer it was we needed to make radical and immediate changes. And within one month of reading this book, we made radical and, I mean, life changing for the next four years. So what do you tell people the keys to getting out of debt are now? Go ahead. Well, for us, it was the budget and working together and sacrificing our Saturday mornings. Russ traveled for 15 years, Monday through Thursday, so we just set aside Saturday morning as our time to focus on our budget and get everything done in the financial department. Yeah, and he's not traveling like that now. No, thank goodness.

Not in the last two years. That's good. He heads out occasionally, but not as often as I do even. That's wonderful. Yeah. Very cool well congratulations you guys who were your biggest cheerleaders while you're doing this well our family our friends and co-workers um and just the support what listening to the podcast and watching the debt-free screams i mean it was like even people we didn't know but that was our our support group. Yeah. Well, Chris Hogan gets the credit for this, and you got to sell in the Everyday Millionaire's book for him. And isn't that funny?

It's full circle. It is. He shows you and gets you inspired to get your house paid off, and then you're actually the guy repping the book that becomes his second number one bestseller. Yeah. So that's pretty serious fun. It's an honor to be a crusader for you and chris well you're you're part of this team part of this family brother we're very very proud of

you guys excellent what was the hardest part of this in the last two years or three years and seven months well for me i'd worked at a preschool i taught 19 kids all day and then after school i would do enrichment classes to earn some extra money to throw at the debt and it took forever and we weren't making much progress yeah I think for me it was just saying no to going out to eat and concerts and a lot of family members went on different cruises and you know we just knew that this was what we had to do for this season well now you can do whatever you want that That's right. You don't have a house payment. That's right. I mean, you don't have a house payment.

Yeah, baby. I mean, that's like a pretty good trip once a month. You know, I mean, that's pretty serious. That's fun. It's a lot of concerts. Yeah. Well done, guys. Very, very well done.

We're very proud of you here. Proud to have you on the team, be part of this family. I would give you a copy of the Chris Hogan book, but that would seem a little bit redundant. But certainly fun that that book, the Everyday Millionaire's book, is the one we give to everyone when they do their debt-free screen because that is the next chapter. When you're sitting on a $300,000 house, you're heading towards everyday millionaire status, loading up the retirement accounts and be able to do whatever you want in this process. Well, very well done.

All right, it's Russ and Joni from our very own team here. House and everything, baby. They did it. $203,000 paid off in three years and seven months. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free!

Yeah! Whoop, whoop, whoop, whoop, whoop! I love it. Well done, you guys. Oh, that is so fun. That is so fun. Hey, listen. If you can hit the decade of your 60s with a paid-for house,

you have set yourself up to retire with dignity. The rest of it you can work out. You can work it out from there. But the largest line item in almost every budget is housing. And when you have zero in that budget item, housing cost zero, that makes retiring very easy. That makes retiring with dignity very easy it's a very important part of this step and the average person that's working the total money makeover baby steps going through financial peace university part of the financial peace membership

continuing to do this stuff over and over and hammering it is out of debt in baby step two. The average is about two years. It takes about another six months on average to build your emergency fund in baby step three. And then you start on four, five and six, and it takes about seven years on average to pay off your home. And so roughly a decade from start to finish there for the typical family now that means some people take a little longer some people do it faster than that and some people we hear parts of their

stories along the way but that's how this stuff unfolds if you're looking for get rich quick you need to change the channel we are not in the microwave business here. We're in the crockpot business. It's going to cook. But you've never had good microwave barbecue. It does not exist. There's no such thing. That's an oxymoronic statement. Good microwave barbecue.

Those things shouldn't be in the same sentence. And money is the same way. It has to cook up. Get rich quick doesn't work. He who hastens to be rich will not go unpunished scripture says so don't hasten to be rich but work a system a steady grind a hustle grind a hustle and grind hustle and grind hustle and grind hustle and grind and you'll look up and be Russ and Joni with a paid-for house. Ha-ha! I love it! Woo! Yeah, baby!

You can do this. You absolutely can do this. But it's how you eat an elephant. You do it a bite at a time. It's by degrees. You win death by a thousand cuts. If you're looking for this to be easy, you need to go somewhere else. It's not easy.

It's hard. The only thing I can promise you is it'll be worth it. It'll be worth it. This is the Dave Ramsey Show. Thank you. Thank you for joining us, America. Open phones at 888-825-5225. Josh is with us. Josh is in Ohio. Hi, Josh.

Welcome to the Dave Ramsey Show. Hey, Mr. Ramsey. How you doing? Better than I deserve. What's up? Hey, I got a couple questions for you. I got people telling me that I should claim bankruptcy chapter seven. I'm 32 years old, currently making $39,000 a year. I'm about $14,000 in collections. I was young and dumb and didn't pay nothing. I also have $9,000 of school loans and a $6,300 auto loan.

So then about collections is about 24 different, looks like here in front of me, like 24 different people. I just started listening to you probably two weeks ago. So I'm just trying to get i guess your input on it should i go ahead with the bankruptcy or should i try to dig myself out of it because i've really been thinking about money lately and i'm tired of living paycheck to paycheck yeah i'm a single father just got custody of my daughter how old's your baby? She's 10 years old. Okay, cool. Well, a guy told me one time when I was broke and I was digging out of the bottom, I was in my 20s,

he said, debt is not the problem, it is the symptom of other problems. In other words, debt is the result of other things going on. In my case, it was overspending, disorganized, impulsive, just not paying attention, you know, that kind of stuff. Which some of that's probably you, isn't it? Sounds like me, yep. Well, the good news is all of those things are choices. And so instantaneously, right now, you can just decide, okay, now I'm organized. I'm not going to live disorganized anymore.

You can just decide, now I'm not spending any money except on a plan because I want to straighten this freaking mess up because I'm tired of the constant stress of living paycheck to paycheck. I feel like a rat in a wheel, and I'm going to do what it takes to never be there again. You can just decide that. Regardless of whether you file bankruptcy or not, by the way, you need to decide that, don't you? Oh, yeah. So the only question is whether you pay the debt off or whether you bankrupt it because you've got to do those other things anyway

or you're just going to always be like this. Agreed? I agree completely. Okay, cool. So you're ready, man. I mean, you're ready to do what it takes. Here's what I want to do. We have a class that's nine weeks long called Financial Peace University

where we will teach you what you should have been taught in high school on how to handle money, how to get on a budget, how to work systematically through these debts and get rid of them. Because, dude, if you had zero payments and you had a plan for every dollar, you'd have a pretty good life yeah yes i would yeah and so that's where we need to get you to and it starts with having a plan for every dollar and then working our way through these debts now the 6300 car loan is current the nine thousand dollar student loan is it current i kept deferring it okay so it's uh it is not bankruptable by the way

it's going to be there after the bankruptcy if you file bankruptcy so's the car debt you're still going to have the car debt or you're going to give up the car one of the two and your car is not really out of control it's not like crazy land okay it's a decent just the apr it's ridiculous it's like 18 oh okay good it's a good one to get rid of then yeah and then you got 14 000 in collections and you're not paying on those anyway right now uh currently no okay and you're not even paying on the student loan right now no just the car right and so how much do you bring home uh bring home a week is about 580 okay and how big was your tax refund i haven't filed it yet how big was it last year i uh last year uh they ended up taking it um but actually i didn't get anything back oh yeah they're gonna take it

again okay yeah do you remember how much it was that they took i want to say it was like only seven hundred dollars okay all right well that's seven hundred dollars too much coming out of your check a year that's where that comes from they over withheld and so you may you do need to go down and recalculate your withholding and uh raise your take-home pay by $50 a month at least, a month. How long? $15, $20 a check. That'll help. Okay.

Are you putting any money into retirement today? No, I stopped that. Good. Do you have any money going into anything at work? No, not currently, no. Good. Okay. And so you're making about 600 bucks a week

and uh so you're making about 2400 bucks take-home pay how much is your rent uh well me and my girlfriend split it uh so out of mine it's about 600 um months okay and uh where does the okay if we take 2400 home and you put 600 on rent uh where's the, okay, if we take $2,400 home and you put $600 on rent, where does the rest of your money go? Stupid spending, honestly. No, I mean really. You need to buy food. You need to buy food. You've got to buy lights and water, right?

How much is your car payment? $307. Okay, there's part of it, right? So that's how a budget's done. You just start to lay it out like that where every dollar has an assignment so here's what i would do let's adjust your w4 and get your take-home pay up slightly 50 to 100 bucks a month extra coming home okay and that'll help a little bit i'm going to put you into financial peace university our nine-week class i'm going to pay for it doesn't cost you anything awesome okay but you got to go Okay. But you've got to go to the class, and you've got to go turn your life around.

That's mandatory, okay? Yes, sir. All right. And then what we're going to do, you're not paying on the collections right now, and you're not paying on the student loan right now. So what I want you to do is I want you to squeeze every dollar out of your life, and I want you to work an extra job or overtime and squeeze every dollar out of your life. I want you to squeeze every dollar out of your life.

You're not allowed to go out to eat. You don't see the inside of a restaurant unless you're working there. You've got to clean this mess up. You're not going on vacation. You have no need to be sitting on your butt watching TV at any point. You have work to do, okay? All right. Game on, baby.

Game on. All right. You can do this. Now, what we're going to do is we're going to pay a stinking car off in 20 minutes here. All right. Game on, baby. Game on. All right, you can do this. Now, what we're going to do is we're going to pay a stinking car off in 20 minutes here. All right, listen. Here's the deal. You owe $6,300, and you got $2,400 coming home. I want you to pay $1,500 to $2,000 a month on this car.

I want this car paid off in four months. Okay. But that's beans and rice, rice and beans at home. No frills, no life no life like that but i don't care if she likes it she's married to a broke guy she'll like a guy that's good deciding he's going to stand up and be somebody and if she doesn't like it she ain't for you you need to be somebody man it's time to do this get your butt on fire let's get in gear you got this man you can do this you're gonna go on fire. Let's get in gear. You got this, man. You can do this. You're going to go knock his car out.

If you had no car payment, would that give you a little confidence after you knock that thing out three or four months from now? Dadgum right, it would. Oh, yeah, it would. Yeah, and then what we're going to do is we're going to line up those $14,000 of collections, and we're going to call the first one, and we're going to get a deal on that. You're probably going to settle those by somewhere oh somewhere around 25 30 cents on the dollar

so somewhere around four or five six thousand bucks more it's going to clear them off so by christmas you could have everything paid off except your student loan and by the time i talk to you this time next year everything's gone you're going to be debt free in just a right around a year but you're going it's going to be the worst year of your life and the best year of your life you're going to do nothing but work and pay bills but you ain't doing nothing but working and paying bills now and you're doing it in such a screwed up way that it ain't even working it's true so might as well get somewhere might as well have a little traction am i missing something here no not at all all right coach you got this man

i'm gonna be with you we're gonna put you in the nine-week class and the one-year membership and you guys line it up and you start showing that 10 year old that are that that daddy is changing his life right now daddy's getting ready to be somebody this is getting ready to change it's gone on long enough this this dull pain that is your life, it's time to shift it into gear. You got this, man. I'm so proud of you. I'm proud of where you're going to be this time next year. You're rocking this.

You call me if you need help, okay? I'm right here, man. I got you. But you better get after it because I'm going to put a foot in your butt if you don't. Let's go, man. Get it. Get it. Get it.

This is the Dave Ramsey Show. This is James Childs, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe to Dave.