The Ramsey Show - App - How To Budget on Irregular Income (Hour 2)

Episode Date: May 8, 2023

Dave Ramsey & George Kamel answer your questions and discuss: "Can I use a HELOC as my primary mortgage?"  How to budget commission checks, from the blog: How to Budget With an Irregular Income, "I'm 59 years-old with $258k in student loans", "Should I pay off the house if I'm about to get married?" Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Join a Personality-led FPU class. Click here! Enter The Ramsey Cash Giveaway for a chance at $3,000! https://bit.ly/TRSgvwy Shop our bestsellers during the $10 Sale! https://bit.ly/TRS10Sale Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods, moving, and storage studios, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual, amazing relationships. Thank you for joining us, America. We're so glad you're here. George Camel Ramsey personality is my co-host today. He's the host of the George Camel YouTube site. And oh, if you haven't seen this, he is the master of snark. We have a good time. I'm a huge fan. I've actually tried to solicit some of the printers to come up with a snark font, and they haven't done it yet.

Sarcasm font. It would be nice to have one. Type with that. Some people just don't understand. But anyway, yeah, you've got the king of snark over here to my right, and he's got a great new YouTube channel taking on all the toxicity that's out there and the stupidity that's out there in the world. You don't want to miss this. It's highly popular. Several hundreds of thousands of people are already joining us there thank you for doing that the george camel youtube channel

888-825-5225 is our number here christina's in yuma arizona hi christina how are you great how are you better than i deserve what's up, thank you for taking my question. I recently sat down with an educational company that teaches you how to use a HELOC as your primary mortgage. I know that secondary HELOCs are a terrible idea, but they had this idea of using a HELOC as your primary and only loan at the house so that, like, all of your deposits and your job and everything are put directly in the HELOC. You still have access to it, and so the premise is you, since you're putting everything in it and you still have access to it, you can pay off the mortgage.

God, that scam is still around. I thought that thing had died. This is not an educational company. This is a scam. Okay. They're not educational at all. No. So their premise is that you use the HELOC and you pay all your bills out of the HELOC,

and then you use your income, and it's direct deposited to pay down the HELOC each month. So you're using your HELOC much like a checking account, as if that's some advantage. Because, by the way, when all the money goes in and all the money goes out, the same amount's left in there. Whether it's a checking account or a HELOC. There's no magic to a HELOC. Okay.

You follow me? What is your income? See, combined is around $130,000. Okay, so let's just make it up ten thousand dollars a month okay right so you put ten thousand dollars a month on your HELOC direct deposited reduce your HELOC by ten thousand dollars from your income this month right then you use your HELOC and you pay all your bills to the tune of $10,000,

and the HELOC balance goes back up. You follow me? Mm-hmm. There's absolutely no change. This is just a checking account. And these guys act like it's mystical, magical, and does something different. It doesn't do a dadgum thing. It makes them rich, so it does that. You're't do a dadgum thing it makes them rich so it does

that you're paying them a fee for their education but yeah you follow me there's no advantage at all zero if you want to pay down your mortgage all mortgages are calculated on simple interest so when you pay down your mortgage it always reduces the amount of interest you are paying the next month. 100% of them. Okay? HELOC or otherwise. HELOC simple interest also.

So it does not get you out of debt any faster than a traditional mortgage by the fact that you're running your bills in and out of a HELOC and your income in and out of a HELOC. It's just circular. The P is still under the shell. Does this make sense?

Okay. You follow me? Mm-hmm. I follow you. What was the purpose in getting the HELOC? What made you go, I'm interested in this? No, she got suckered into this education company. It had nothing to do with the HELOC.

She wasn't looking for a HELOC. They were looking for her. Right? Yes. do with the HELOC she wasn't looking for a HELOC they were looking for her right oh yes um I was looking at uh I've seen the ads about um how you can pay your house off really fast and I just was curious and I haven't done it yet I just let me just let me let's try let's try again okay just to make really sure you understand because I don't i'm not 100 i got through so the way the house is paid off is when you pay down the principal running your bills in and out of the house your income into the house your bills back out of the house does not pay down the principal

if out of your 10 000 you wanted to reduce principal $3,000, you could just take $3,000 out of your checking account, put it on principal. If you put nothing on principal, principal's not going down. You put $3,000 on principal, that's the only way the house is paid off. It does not get paid off because you ran your bills in and out of it. That does nothing to pay off your house. The only thing that pays off your house is you pay on the principal. That's the only way their system works but they've got this little uh chart crap that they show you that you're going to use so much of your income to actually reduce principal well duh

of course you could do that anyway and you don't need them so now run from this please please run from this how much mortgage are you talking about taking out? Well, we just recently bought a house, so we owe around $290. Oh, okay. Just leave that alone, then. Just leave these people alone. Have I convinced you? Please.

Yeah. Please. Okay. Run from the education. Prices are subverted. Education company. That's my favorite part of their marketing scheme. Yeah. I met with this education company.

They were educating you. Yeah. Okay. So I thought that thing, man, I haven't seen that scam in probably a decade. A lot of this crap's coming back around, though. It's like fashion trends. Tic Tac is bringing a lot of it back. That's true.

Well, the whole life people have come out. There's a whole other generation that hasn't been screwed yet. So we've got to bring back all the old scams and get to the young people. Well, back in your day, you had to seek out stupid. Now it just shows up in your face 60 seconds at a time from some slick guy. Yeah, your algorithm will help you get there for sure. But, yeah. And the other one was the – what's the thing called?

The whole life savings program a 707 or 770 whatever oh remember that one no it's the same kind of crap but it's a whole life agent okay whole life i know infinite banking that's the one that's the one okay that's the one but it's got it's got a number to it that they use but it's a you know it's also just a complete scam i don't mean criminally illegal i just mean it's also just a complete. It's a life hack. By scam, I don't mean criminally illegal. I just mean it's so stupid it should be criminal. That's what I mean by scam. It's just like.

You can, debt is tax free. You can borrow from yourself. Exactly. That whole idea. Yeah. Because 100% of the time you borrow money. Borrowed money is not taxable, people. It's not income. And if you borrow your own money, yeah, it's not taxable people it's not income and if you borrow your own money yeah it's not taxable either and you're stupid because you just paid interest to borrow your own

money you're pulling a fast one on you that's you you got him buddy you you got the guy oh wait a minute the guy's me oh crap if you just think about this stuff long enough you should back yourself off the ledge the problem is it's all impulsive and a guy told you well and they man and a tick tock let me tell you the two the other thing the thing about the infinite banking and these guys here too is you will get screwed more often by an enthusiastic ignoramus than you will by an actual con artist because some of these morons actually believe this stuff and they because they believe it, they can make you believe it. But it's, yeah, enthusiastic ignoramuses. There's a lot more of those than actual con artists.

They're the same ones selling you a star in the galaxy, Dave, with your name on it. Those are the same guys. They've just switched businesses. Is that back, too? That's back, baby. It's called an NFT now, Dave. Look into it. You own it, I promise. Unbelievable. It's called an NFT now, Dave. Look into it. You own it, I promise.

Unbelievable. It's virtual ownership. I mean, just think about that. This is The Ramsey Show. George Campbell Ramsey personality is my co-host today. The question of the day is brought to you by Neighborly, your hub for home services after fires or floods. Their rainbow restoration pros offer homeowners trusted full-service restoration expertise

like mold remediation, carpet cleaning, odor removal, and more. Visit Neighborly.com today and you can find rainbow restoration services in your area. Today's question comes from Bethany in Indiana. I'm in baby step two and looking forward to when I can budget more for my fun money. I'm trying to stay motivated and making a list of things I can do when I finally pay off all my debt. What are some of the things you spend fun money on? Now that's a fun question. A lot of fun in this question. So the things that we say not to do when you're in debt,

that would be first on my list. Things like eating out, going on vacation, upgrading a car for fun instead of because you have to. So that would be at the top. Is those just things that make life a little bit sweeter, like eating out? So after you're out of debt, you could put back on a restaurant budget, put back in a budget for vacations, put back in an upgrade for Whitney

and Sharon would say furnishings. Oh, that's a nice word for it. You would have to upgrade the old furnishings because that old couch sucks. Home decor. That was sticking me in the back with that broken spring. And then there's things, you know, your hobbies, things that you just enjoy doing that cost money. Maybe for Dave, it would be golf these days. So during baby step two, we are not devoid of fun.

We're devoid of paying for fun. Yes. Ding, ding, ding, ding, ding, ding, ding, ding. There's a big difference. See, fun is like happiness. Like hiking is a hobby that can cost you nothing. So that's a great one. There you go.

Frisbee in the park. But a lot of people's hobbies are wildly expensive and they justify it. So again, fun money is not just for post baby step two, but we limit it while we're in baby step two so that we can allocate more towards getting out of debt. You know, and what's weird is we often hear stories of people it makes you reassess that you can't purchase fun fun is a decision or happiness you can't purchase it it's a decision you know and so you know joy these are things so i mean for real going for a walk for real going for a hike for real doing things the kind of old school things if you will and i think about you know what what what is entertaining and it resets your mind because we are so programmed

in our culture today especially with smartphone right we are so programmed in our culture today, especially with smartphone, right? We're so programmed to think a certain way that this is where, you know, there should be an app that you just went fun and it just sent you a box, you know, a box of fun. That would be wonderful. Here's a box of fun. I'm sure there's one for that.

I'm sure there is. But, you know, the point being that probably doesn't have anything to do with your smartphone. Matter of fact, I'm pretty sure it doesn't. Yeah. I mean, good relationships and good hobbies go a long way more than, you know, just going out to the bars every weekend or whatever it is. And look at what caused you to go into debt and look at the root of it. The things that were actually pure that weren't to impress others or things that had the right motivations and go, you know, I really do enjoy X, Y, Z.

I'm going to allocate more money towards that and put a line item in there. And then there's no regret, no remorse. Once you're, I mean, like the number of times you talk to say an old person that went through the great depression, not as many left around these days, but if you had the pleasure of having conversations with them, they both, they talked about the great depression uh as both a time of great sacrifice a great need but they also found a part of themselves during that time that they wouldn't have found otherwise and while you're working to get out of debt you can kind of discover you know relationships sunshine these important things that are out there that do qualify for Baby Step 2 stuff.

It's the stuff Sharon and I did. We did nothing. All I did was work, and then if we were going to do something, it was super, super, super like no money involved. Wow. And we got out of that. We got everything cleaned up and got the IRS out of our life. God help me.

All right, Mitchell is in Chattanooga. Hey, Mitchell, welcome to the Ramsey Show. Hey, guys. Thanks for taking my call. Sure. What's up? So a budget question. This year in January, I recently started a new job that is sales. So it's base plus commission. So I have the same base pay every month. But so far in the last three months, the commission's been sporadic. So I'm trying to figure out how I would work that. I use the every dollar budget and I'm trying to figure out how I manage that and work that with each month being, I have the same amount in base, but the commission's different. I'm just trying to figure out how to manage that commission.

So what would be your worst month? My worst month would be just base pay, $2,500 a month. Okay, and what are your basic expenses when you look at your four walls, your food, utilities, housing, transportation? What does it cost to cover those? Maybe $2,000 a month. Okay. Including the mortgage. So on your worst month, you've got all the necessities taken care of.

Correct. And so beyond that, start to make the next list of priorities until on the other end of the spectrum is just the fun luxuries of life. But if you went, hey, we don't have money for that this month, we're not going to allocate that in the budget. Okay. And it's a prioritized spending plan for everything. So your three months that were sporadic, what were the three numbers above your base? What were the three commission amounts? February was my first month of actual selling, so it was about $2,000.

Last month was $5,000, and then this month I'm pulling in $9,000. Nice trend. It's been going up. Yes. So you're at 11.5 with your base, right? Correct. You're not earning through the base. It's base plus.

Correct, yes. Okay. So 11.5 for the month. Okay. You think that trend line continues? I hope it does. What are the guys that do what you do what's the most they make uh the average among everybody is between seven and eight thousand dollars a month correct yes

of commission okay so you're already above average after the third month correct okay is that sustainable or did you just get lucky well it might have been luck this month i had one big sale come through because if that sale didn't go through i'd be at three and a half gotcha okay so what i would do is i i would budget your low average of these so i'm thinking your low average is four or five k of commission i don't think you're going to dip below that again do you no okay so let's take let's take 5k that's 7,500 now and let's run a regular budget on 7,500 because you're very unlikely to go below that and then i mean if you do you step back in correct your every dollar as you're doing it and then everything above that do what george said and

say okay if i make a dime more than 7,500 what is the number one goal I've got for money beyond what I covered with the 7,500, right? And that's your number one. Okay, if I got that done, what's the next thing I would do? Number two. The next thing I would do, number three. So if you're working your debt snowball or something, your number one goal is going to be that next debt on the list, right? If you're saving money for build up your emergency fund of three to six months of expenses baby step three then your number one goal would be that throw money into emergency fund until it's done then once you're doing that then my number one goal is 15 of my income oh now we're going to take 15 out once we get to baby step four oh and then we're going to start kids

college oh and then the number one goal after that i might be saving up for a better car or i might be saving up for a vacation or by the way, Christmas this year is in December. We ought to get ready. And they don't move it. And, you know, that kind of stuff. So you start laying these things out, but what you're doing is you're prioritizing every dollar for the coming month beyond the $7,500 stated every dollar budget. And you just have a to-do list in order of how I want to spend

it. So you always spend more money on paper than you're going to have coming in. I love it. And I'm going to do one better. Hang on the line. Austin's going to pick up. I want to gift you one year of every dollar premium. And there's a great tool called Paycheck Planning in there that will also help you with this along the way, where it'll tell you exactly when and if you would run out of money and you can reallocate your spending your bills for that purpose but i love people call in dave and they go i can't do a budget dave because i have a regular income so that's not for me you need a budget more than anyone absolutely because you'll you'll fall into the thing of trying to out earn your stupidity i did that straight commission for years and uh

i almost did it. Almost succeeded. But the stupid was big. It was bigger than the income. So there you go. That's how it goes. This is The Ramsey Show. George Campbell Ramsey personality joins me here on the Ramsey show as my co-host uh want to give away some money I would love that uh never using my money to give away stuff is my

favorite thing I think it's my spiritual gift at this point to give away your money Dave and uh everybody's got to have a calling and it can't happen for me because I work here I think that's only fair but for you all listening out there we've got a chance for you to win some of Dave's money in the Ramsey Cash giveaway. All month long, you can enter to win up to 500 bucks or the $3,000 grand prize. All you got to do is go to ramseysolutions.com slash giveaway. And yes, real people actually win this stuff, which is really cool. Make sure to enter every single day to increase your chance to win. There's no purchase necessary, but sorry, kids. You do have to be 18 or older to win.

And today just keeps getting better because the $10 sale is back, and you all know I love a good deal. And this is about as good of a deal as you're going to get on all of the products that you need to start building wealth, a career you love, improve your mental health. Almost all of our best-selling books are $10. That's impressive. That's like- And we got some new ones on there this year.

Yeah, like- Dr. John Deloney's is on there, Own Your Past, Change Your Future. Baby Steps Millionaires is on there. That's Dave's latest book that lays out stories of real people, including teachers who became millionaires using the baby steps. And I did some math, Dave, because I was curious what $3,000 can get you in today's world. So the grand prize is $3,000, no purchase necessary. And what can $3,000 get you?

Well, it can get you 85 days of doggy daycare if you're me, which is pretty impressive. You're kidding. Yeah. Is that a lot to you or a little? I don't know. What is doggy daycare? It's where you send your dog to be taken care of while you're at work i can't just wait on you to get home well you want to give it a good life dave you know you send your kids to daycare why not the dog oh lord what is this world coming to

you tell me okay uh it can get you less than a tenth of a bitcoin if you're interested in that neither one of these sound like a good idea we're 0 for 2 for day okay yeah it could get you get this 300 copies of the total money maker now i'm in okay imagine that all right if you win this giveaway and you turn around and buy 300 copies of the total money makeover change 300 people's lives with a coaster for their that's pretty coffee table here's what else could get you maybe and, and I mean maybe, two Taylor Swift tickets. Yeah, one and a half. Depending on the day.

I don't know who the half going is, but you get one and a half for that. Goodness gracious. And lastly, this is my favorite. It can actually buy you a beater car in 2023. And James, our producer, did the research because I know the haters are coming after us already. Here's what this can get you in the Nashville area. A 2002 Honda with 117,000 miles on it. For three grand. That's a Jesus car.

Is it? Yeah, he said they're all in one accord. There you go. He'll be here all week. 3,000 bucks. You missed your calling in stand-up, Dave. I did. But instead he's giving away money. Because I'm sitting down. I love it. Don't miss it. RamseySolutions.com slash giveaway. I told you

something. 3,000 bucks. It's impressive. And all you it. RamseySolutions.com slash giveaway. I told you so. $3,000. It's impressive. And all you got to do is just come register. That's it. Come hang out with us. RamseySolutions.com. LaRonda is with us in Roanoke, Virginia. Hi, LaRonda. Welcome to the Ramsey Show. Thank you very much.

How can we help? Yes, I'm currently working two jobs to try to make ends meet. However, I'm 59 years old, and my credit report shows that I owe $258,000 in student loans. Is there any way I can make that go away? Good Lord. You're 58? I'm 59. 59.

What did you study and when? Well, actually, I have three degrees, and with parents and students going to college, they make the parents do the Parent PLUS loans and pay for them. Make? Hold on. You said they make them? My son wasn't able to get the tuition for his classes, and I had to do Parent PLUS loans the whole four years for him.

Or not go to that school. Okay, so you did. So what is your household income? My regular job is like $60,000 a year. I have a mortgage. And you got three degrees in what? The first degree was in multidisciplinary studies, criminal justice and religion. The second was a master's in accounting and then a master of divinity in theology and homiletics.

So why does a master's in accounting only make $60,000? There's a long story about that. I don't think that a master's in accounting in this area would get you $60,000. It just so happens the job that I work at now pays a little bit more. And you're in accounting full-time? No, I'm in logistics. I'm a logistics specialist at Volvo Trucks. I'm extra confused.

So we've got the Divinity stuff. You're not doing anything with that. We've got accounting. You're not doing anything with that. We've moved to logistics. Well, you're using accounting and logistics but yeah okay and the multidisciplinary criminal justice is not in use um okay so well the answer to your question because these are disturbing numbers at 59 years old

the answer to your question is is we have to make more money and you have not monetized your knowledge base very well most people with a master's in accounting make 100 100 and a quarter a year starting just to get going you should be able to pass your cpa with a master's in accounting and you should move into that field and get up into the six figures. That's going to be mandatory. I'm a little lost as to why your career is so underproducing with all of your knowledge base. But whatever the reason for that, you need to do a little soul-searching, and we need to move your income way up, like dramatically.

As a matter of fact, I'd like you to be at $120 heading towards $220. That would be wonderful and by the way supply chain generally pays more than 60k and roanoke is roanoke virginia is not a backward town i mean that's a substantial city um i think that i don't think it's anything to do with the areas of study or the area you live in as much as it does your attitude towards it? Well, when I tried to apply in the accounting field, our handicap is that through the college that I went to, Liberty University, they teach you how to do everything the hard way. But when you go in for a job interview, they want you to know how to do it

through the computer, where previously we had to do it with two calculators and work it out the hard way. They want you to already have experience in SAP, which is just plugging in the figures and letting the software do what it's supposed to do. Yeah, but that's not rocket science. I know, and they think it is. For God's sakes, I can do it. Right. And I can't even operate my phone hardly.

So, yeah, I mean, um yeah sap is a standard you know you don't do accounting by calculators and haven't in decades so um and the other piece of this is the student loans there's no way to just make them go away i mean you can't even bankrupt these things and if you want to see stories of that, go watch Borrowed Future. And so there's going to be a conversation with the kids. I don't know if they're willing to chip in for their loans, even though it's legally on you. I would still see and say, hey, mama wants to retire one day. And if they make good money in their careers, can they pay some of this down? Yeah.'re gonna if you do not uh get above this instead of laying under it in terms of this being your career where the career problems are all happening

to you and instead you start happening to the career issues and get on top of this and get up leave the cave kill something and drag it home the math on this is really, really not going to go well. 60 to pay off, 258 at 59, that's called a small shovel and a very large hole. We have to change your shovel-to-hole ratio mathematically to get you out because these are not going away. They're not going away. So the way you get rid of them is you increase your income dramatically and you keep your lifestyle down at nothing, which it probably already is,

and then you just start throwing the difference at this very, very, very aggressively. So let's just pretend that over a year or two of working on this that you got to, let's just be real generous, 160. Well, that's 100 above what you're making now, and then you start throwing 100 at 258 you're done in three or four years because by then it will have grown some so it's not going to be a straight line issue so that's what you're dealing with supply chain is not a bad field accounting is not a bad field both are hiring now and both are computer driven

and you're going to learn to operate a computer if you don't know how, if you're going to win at this. So figure out what you've got to do to get to where you're happening to your career with this knowledge base because you've paid a lot of money for all this knowledge, and you're not getting anything for it. And you need to monetize the knowledge base. That's what it amounts to so hang on we'll send you a copy of ken coleman's book from paycheck to purpose i'm also going to sign

you up free for his assessment his career assessment i want you to take that and let's George Camel Ramsey personality is my co-host today you can see his new YouTube channel anytime you want just check out the George Camel YouTube show it's pretty stinking incredible hey if you're liking this show and a bunch of you are new thank thank you for that. Just to let you all know the inside story, we don't have a $300 million a year marketing budget. We don't have a football stadium named after us like, oh, I don't know, Suffolk or something like that. Excuse me. Allergies are bad this time of year.

Bless you. Gesundheit. But anyway, so the only way this show grows and we help people, more people, is you tell people about it. So we appreciate that. Share is you tell people about it so we appreciate that share it tell people you listen tell people where your talk radio show is or talk radio station you listen to or you can share it digitally if you're a podcaster or a podcast listener or a youtube follower or something like that you can just hit the share button hit the subscribe button the follow button and that way it'll automatically show up on your devices and we'll be there for you all the time.

And also, by the way, leave a five-star review where you can. One stars are not helpful. Mama said if you didn't get anything nice to say, don't say anything at all. But all the five stars we can get and all the shares and the follows and the subscribes, all of those things push the show to the front of all the Internet algorithms and cause it to show up on new people's searches faster and easier. And we get more and more people we can help. Thank you for that. We appreciate you. Daniel's in Atlanta.

Hi, Daniel. Welcome to the Ramsey Show. Hey, thanks, Dave. Thanks for having me on. Sure. What's up? So basically, I have the ability to totally pay off my home right now, but I am getting married in July, and my fianc due, she's going to have around $300,000 in student loans to pay off. And I was just trying to get some advice on how I could potentially, or what I should do with my house right now,

because I have that three-year buffer until any payments are due to help my fiance. So she's got three years of school left? that three-year buffer until any payments are due to help my fiancée. So she's got three years of school left? Yeah. And how's she paying for that? I'll just, I'll be helping her. She's just taking straight loans.

I'm saying after you're married, what is your income? Okay, so right now I have a fairly volatile income, but my salary is $110,000. How much do you have in savings? I have $275,000 in savings right now. Okay, what's it take for her to finish school after July? How much? Yes. The grand total for her to finish up is going to be $300,000.

The total of our whole schooling, but she's already started, hasn't she? Yes. Okay. How much does it take from this point forward to finish? So she's already, so it'll be, that's going to be the entire total. So I'm not exactly sure what she's taken out so far. Well, that'd be good information to get since you're marrying her. Yeah.

What's left on your mortgage? So I have, well, I know that it's going to be $300,000 whenever it's all said and done. But it's not all said and done yet. Okay, so she's already been in school, what, a year? She's been in school what a year she's been she's been in school um she's finishing her second year okay and she's got three more to go yeah she's okay

but my point is what here's what i'm trying to lead towards and you don't have the numbers and you're trying to box me into some kind of corner or you just truly don't know so the deal is this what i want you guys to do is I want you to pay cash from this point forward with your money from July forward after you're married. I don't want her to take out any more loans. I want to use your $275,000 for her to finish school. No more loans. And my guess is she probably has between $50,000 and $100,000 right now.

That's my guess is she probably has between 50 and 100 right now. That's my guess. Okay. And so she probably needs another 200 or so to get through school. But let's budget and set aside of your cash what it takes for her to finish med school. That's most important. Because the first step to getting out of debt is not going further in right okay do no more harm similar to her Hippocratic oath she'll take later right do no more harm okay so we're going to just we're going to cash flow now whatever cash you have

above what it takes for her to finish from today forward, then we're going to start talking about paying off her student loans. Then once those are gone, we're going to work towards paying off your house. That's working the baby steps. First, borrow no more. Second, begin to address the existing debts that are there. Third, we have an emergency fund. Fourth, we build and we start to pay off the house and maybe step six. That's what you've got to, but what you've got to ascertain to do that is you've got to find out what it takes in cash from July forward for her to finish school. And that is a number less than 300 because 300 is all in, right okay we got there so yeah the goal is not to take

any new loans when july hits and you guys are married so cash flow the wedding cash flow the honeymoon let's come back let's look at the pile of money we have our incomes our debt load and begin to pay it all off yeah and then when she graduates and is an MD, hopefully her income will be north of $200 pretty quick, and your income, so you're going to have a $300,000, $400,000 household income, and you'll finish paying off the house very quickly at that point with what's going on. So you've done a great job saving money. You're signing up for a debt ride.

That's part of what goes with July. You've got a big old debt ride. But we're not going to just keep piling on the debt while we reduce the debt over on the other side, on the house. That doesn't make sense at all. In a sense, that's like borrowing student loans to pay off your house. Mathematically, it's about the same thing. It's just a balance sheet switch.

Pay off 300, take out 300. Yeah. Exactly. mathematically it's about the same thing it's just a balance suite balance pay off 300 take out 300 yeah it's you know exactly we're going to pay off 300 on the house but we're going to take out 300 over here on student loans so that's the same as borrowing on student loans to pay off your house which we wouldn't tell you to do that and nobody would do that on purpose either it's just a but that's the net result of all this trying to hide the p under a shell thing when people talk about dave we took a call earlier and someone said, is it fair? Because it's not her fault I went into this debt.

And we just walked him through this and went, hey, you saved up hundreds of thousands of dollars and all of a sudden you get married and you go, oh, but I worked so hard for that. I got to pay off her medical debt. How do you overcome that? You are marrying a doctor. That's helpful. there's an upside

there if you want to play uh tit for tat quid pro quo here you should be able to get a great income out of this show as you go along so there's an attitude and mindset that goes along with getting married that's hard for people to stomach in this very independence driven world where we i worked hard for this dave i shouldn't have to pay off their loans there is that mentality yeah but he wasn't saying that he was just trying to figure out the best strategy i was impressed by him because he was so quick to go all right i'm going to pay off her debt i'm going to cash flow her med school which is or do i pay off my house which is wise that's what he's asking so it wasn't it wasn't a tight hold on it but that's uh that that's how we'd handle it, Daniel. The other thing that I want everybody to be careful of,

and we've seen it in the last hour, be careful of your language. Jesus said, out of the abundance of the heart, your mouth speaks. So I was forced to. I'm trapped. I had to. I can't do this. In our area, you can't do this. And all of these absolutism- statements and verbiages indicate a victim mentality, indicate you're stuck and you're not stuck.

And when Daniel kept saying all in, all in, all in, it's like it presupposes that debt is the only way to do this. And it's not presupposed because you called the place where we don't do it. We presuppose quite the opposite. And so don't presuppose. All in. We're not doing all in. We're not going that. That's not the plan we're on anymore.

It just changed. She's marrying you and you got money. There you go. This is The Ramsey Show. Dave here. You can find all of our shows with the Ramsey Network app on your smartphone. It's the only place to listen to the entire back catalog of episodes. Download the Ramsey Network app in your favorite app store today.