The Ramsey Show - App - How to Know What a Car Is Worth (Hour 1)

Episode Date: December 25, 2018

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Music Music Live from the headquarters of Ramsey Solutions, 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. You jump in, we'll talk about your life, your money. It is a free call.

888-825-5225. That simple. Michelle starts off this hour, Effingham, Illinois. Hi, Michelle. Let's try again. Try to get the button down this time. Hey, Michelle, how are you? Hi.

Merry Christmas, Dave. Merry Christmas. How can I help? Well, I have a question. We are currently, the only debt we have is our mortgage, which is about $55,000. Good. Have about $6,000 in savings. Good.

But just found out that my son needs braces. Mm-hmm. not until this summer, and our local orthodontist does offer payment interest-free for two years over the span of the braces. What's your opinion on that? I'll pay cash. Okay. And you can save up and do it by summer. Okay. And our kids, two of them had braces, and we just paid for it.

Okay, so even if it takes longer than this summer to do that? Why would it take longer than summer? Well's your household income um it's about 55 000 you don't have any debt just the house yeah so okay i mean i might you know if you need to pick up an extra job or something between now and then to knock out some extra savings to make sure it happens what's the bill on the braces? About $5,000. Okay. Have you gotten a second opinion? No, not yet. Oh.

We've dealt with this orthodontist for about four years, and every year we go in and he's not charged just a dime for consultations. But I could consider a second opinion later. Oh, absolutely. I'm going to price shop him. Okay. I may not. The only reason he's giving you the free business is because it's moving towards

a $5,000 sale. Right, right. So there's nothing wrong with that. I mean, it doesn't sound outrageous, but dental stuff, I always, if it's expensive stuff, I always get a second look on it, and I'm always, you know, well, a lot of things I get a second look on, but take a bid just like anything else you're purchasing. You don't buy it blind. You compare and you

talk to others and so forth and then you make your decision, but the good news is you've got a little bit of a runway here and you can save up and pull this off with cash and that's certainly what we would do. Eric is on the line in Los Angeles. Hi, Eric.

Welcome to the Dave Ramsey Show. Hey, thanks. Merry Christmas. Merry Christmas to you. How can I help? Well, so I did my yearly budget, and I did my net worth, and I got to get after it, you know, life or death, gazelle intensity. I'm looking at probably working seven days a week with Saturday night and Sunday night off,

but my wife, she's really not on board with it. And so my question is, I mean, is there a point where you just forge ahead and drag your spouse behind you or, I mean, how does that work? Okay, so what is the goal you're trying to accomplish with all this work well i mean number one i got to make ends meet but number two you know did the net worth and i'm i'm negative 192 000 yeah but i mean you have a lot of debt yeah okay personal debt other than your home uh don't own my home. It's all personal debt. It's a little bit of everything. It's student loans.

It's taxes. It's medical bills. Wow. And that totals? It's everything you say not to do. That totals $192,000? Yeah. How much of that student loan debt?

Probably about $30,000 of it. Okay. And what's the rest of it? About $70,000 of it is actually tax debt. Oh. How'd you end up $70,000 owing taxes? Well, because I have child support that i have to pay and it's it's quite high and um just cost of living here in california no i mean i'm sorry child support

child support does not cause you to be 70 000 behind with the irs how'd you end up with the irs if i but if just budgeting month to month if i pay child support and pay insurance and try to keep a roof over my head and pay taxes it it couldn't do it so i'm paying the very minimal so you're self-employed so you're self-employed say again you're self-employed uh no again? You're self-employed. No, no, I work for a company. Yeah, but how did you not pay your taxes? You're under withholding that much? Yeah, I'm claiming like married and nine.

Okay, so what is your household income? $87,000. Okay, well, that's not working, dude. You've got to get the taxes right because the irs is going to kill you their penalties and their interest is the is higher than any other thing you can do so 70 of the 192 is back taxes and then and student loans is $30, so that's $100 of the $192. What's the other big pieces? We owe probably about $50 on two cars. Okay. And then, you know, the rest of it is... Which car is the most expensive?

I'm sorry? Which car is the most expensive? Probably, we picked up a car from Carmax uh it was kind of an emergency situation um and so we had to pick up an extra car last year and that's what do you owe on right i think the 10 day payoff on it is is like 18 000 or so then the other one has to be more expensive if you owe 50 on cars you owe 32 on the other car i'm sorry you owe 32 on your other car yeah about okay you got cars you can't afford your car your cars i mean i'm paying a thousand dollars a month just in vehicles that's not gas or insurance or anything yeah you're dying here you gotta sell the car these cars gotta go both These cars have got to go, both of them.

And you've got to get a couple of beaters while you work your way out of the rest of this mess. And so I think what you need to do is not announce to your wife that you're going to work all the time. I think you need to sit down with her and say, hey, let's look at this together. And you start unpacking these numbers and showing her, you know, we make 87, and we have this much in debt here, and we have this car debt, and we have this and this and this. And when you lay all that out in front of her, if she is a grown-up, she's going to freak and say, yes, you have to work all the time, and yes, we have to start selling some stuff, and yes,

but if she's a child, if she's just a little girl, a princess, then she's going to go, well, you just do whatever you need to do then, and she's going to just be a butt, in which case you need marriage counseling. But I think she doesn't have the information. I don't think she's a child. I think you just announced to her like you did these stupid butt car purchases and not holding enough out on your taxes what you were going to go do instead of sitting down and showing her where you all were and why you need to work like a maniac i agree you need to work like a maniac

because you got a real mess you got to sell. You've got to get on a really tight budget. This family's going to have to change a lot of stuff, Eric. You are about to hit the wall, man. You're not far from it at all. Hold on. I'm going to send you a copy of the book, The Total Money Makeover, to try to help you too. This is The Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major health care costs. Christian Health Care Ministries is the original health cost-sharing ministry. A Better Business Bureau-accredited organization, CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually

supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thanks for joining us, America. We're glad you're here. Open phones at 888-825-5225. You know, I think I may just quit social media.

What do you think? You think I ought to quit social media? I mean, it's Christmas time. Merry Christmas, you guys. I'm having a blast. And then I look down at my Twitter feed. People say crap on there that they would never in a million years have the courage to say standing in front of you. Ever.

It's just, I mean, some of you have no real courage. You have digital courage is all. It's amazing. And I'm about to the point that I never really cared. I've got pretty thick skin, but I'm about to the point, I just don't know if I want that in my brain anymore. I don't know if I want to put that crap in my brain, the people who have no life and no courage.

Because I'll tell you the other place you can do this. You want to know why some species eat their young? I'll tell you how. Read the comments after any article. These negative, crazy people commenting after any article. Anything from a football coach to a... It doesn't matter what the article is about. It all devolves into I love Trump or I hate Trump. It all devolves into devolves as opposed to evolve.

Okay, if you don't know what that means, you write in the comments all the time so i mean it it just goes down the toilet and the you can tell these people are there's a lot of really angry people out there and so yeah i think i'm going to continue to stay continue to carry a firearm there's a lot of angry people out there wow and that have no courage to act. You know, if you had, you remember in the old days when you didn't know someone was saying

something about you because you didn't have Facebook or you didn't know. My wife is sitting there looking at Facebook this morning. She goes, well, look at so-and-so. What if you hadn't known that

your day would be better if you didn't know that? And all she's doing is electronic know that and all she's doing is electronic gossiping is all she's doing right she's looking at looking at somebody at some thing that they were doing and keeping up and see people you know when you post all that stuff you post on facebook you in your little mind you think everyone that sees that thinks it's good but some of them sit and they go well well, look at that. You know? It's just, I wonder what would it be like

without Facebook? We can only dream. What could it be like with Twitter, without Twitter, where people with no courage can say anything they want to say? Because, I mean, you would no more walk into my lobby here or walk up to me on the street in a neutral setting and have the courage to say to me some of the things that some of you say about me or to me.

It's amazing. Amazing. And that's true about everybody, by the way. People that, you know, you don't even have to be in the celebrity spotlight to have that. You just have a Facebook page and then someone will look at your picture and go, well, and she's putting on a little weight. You know, looks like the Christmas cookies have been going. You know, I mean, people, what? And you were just posting a picture having a good time out with your boyfriend.

I mean, come on, you know. And somebody's got something to say. Now, sometimes they say it on Facebook. Sometimes they just turn around and say it to somebody else. But, gee, man, it is a bunch of jerks out there. Wow. Scary stuff. Yeah, I think I would prefer to just only know you're a jerk as if you actually had the courage to say to me something that proved you were a jerk.

And then I wouldn't have to think about it. I may just do that. It's the new year coming up. Twitter's kind of dying anyway. I can't stand Instagram. Rachel loves it. They can do it. They have slits in their jeans.

My jeans don't have holes in them so i can't do instagram yeah that's one of the rules it's federal law you're not supposed to be on instagram if you don't have slits in your jeans so um and i don't really need to do an insta story about anything i just can't think of anything that's important enough for me to do an insta story about it so i might just do that i might have to think about this it's kind of spontaneous it launched me into this sort of half-butt rant that's not really that good and wandering but i might just abandon social media oh we'll pay somebody here to do it with my name on it you

know that but i actually get involved in this crap now i'm down in there fighting with you on twitter calling you names back and all that stuff and retweeting your stupidity so somebody can pick on you. James will still pull the mean tweets, so I'll still get to hear some of them when we do Dave Reed's mean tweets. But I might just not read them to start off my day or in the middle of my day. I'm going to Amy Grant's Christmas tonight. I'm going to hear Tender Tennessee Christmas with Vince Gill sitting on the stage. I got third row seats, two of my favorite people on the planet. Merry Christmas.

I don't need this junk in my brain. I mean, Amy and Vince are nice people. They're going to do a great performance tonight. Why do I need to put up with you? Oh, my gosh. I'm not talking about you two in the booth. You guys are all right. Most of the time.

Open phones at 888-825-5225. Speaking of Facebook, here's a good use for it. We got a question in from Facebook. Todd says, is there a good place to look up information on what to spend on a car? There are several good places to look up information on what a car is worth. If that's what you mean by what to spend on a car, you need to establish the value of the car you're looking at buying and what is the market value. And anything below that is called a good deal, right? And you can do that at kbbkellybluebook.com.

They are the standard. And look up private sale or wholesale, but you don't ever want to pay retail for a car. Edmunds Car Guide is another one that's pretty good. You can learn a lot just by surfing through AutoTrader and just establishing what the cars are selling for. You know, I'm looking at a 2012 so-and-so, right? You know, we were just buying those cars as gifts to give away. And so we look up what they're worth and you scan around and see what other people are selling a car for.

Here's the thing. Anytime you're buying anything, especially a big item like a car, he with the most information wins. He with the most information wins. And so take your time and learn about the car and learn about the market value of the car learn the process and when you have knowledge then when you do walk upon one you'll go i can do that one that's a good buy because I know the definition of a good buy at that point. And, you know, you can work it through. So, you know, do Kelly Blue Book. Scan around through AutoTrader.

Poke around on that. Scan around through Edmunds Car Guide and anything else you want to look at. Car Guru is not bad. You can look around on it and see what they're doing. There's a bunch of these websites that sell cars and list all the dealer cars and all the individual cars for sale in the area and you can pull out the dealer cars and just look at the individual cars and or you can pull out the individual cars just look at the dealer cars but you'll start to get a feel a rhythm of what a car with an x number of miles on it like you're looking for is worth. And once you know that, then you know what to buy.

Now, that's how you establish your price on the car. Now, what to spend on a car is this. Cars are the largest thing we all buy that goes down in value. Now, I like cars. I'm a boy, and I've got some nice cars. They are, however, a very, very small percentage of my net worth. Because if your net worth is tied up in automobiles or things with motors in it of any kind, you don't have a net worth.

That thing is going down in value so fast you can't breathe. I mean, you've got a boat, two Sea-Doos, a John Deere lawn tractor that's $8,000, and, you know, three cars sitting around, and that's your entire world of investments. You own a whole bunch of stuff that's going down in value, and you're going to lose your butt. And so whatever you spend on a car, it needs to be a small percentage of your world. The total of everything you own that has a motor in it should never be over half your annual income, with very rare exceptions, even if you're paying cash for it. So that's your guideline on how much to spend on the car. This is the Dave Ramsey Show. Let me tell you a story about two families that are very much alike in a lot of ways.

Both families have two working parents and a couple of young kids. Each has debt and has struggled to make ends meet. But they're starting to make headway with their budgets and smarter decisions with money. They have dreams and plans, and the only real difference is that one family has the right amount of term life insurance and the other doesn't. Big difference. If one of the parents die, and that does happen, their well-being would be destroyed. Paying for the mortgage, utilities, food, and other bills would be impossible let alone saving for education or retirement that's why every day i talk relentlessly about getting term life insurance just go to zanderinsurance.com or call 800-356-4282 and see how inexpensive it really is

be the family that takes those deliberate steps to be different and responsible. It really does make you the hero of your story, and it puts you on course for better things ahead. Merry Christmas, America. This is the Dave Ramsey Show. Open phones at 888-825-5225. Michael is with us in Pittsburgh. Merry Christmas, Michael. How can I help? Thank you. Merry Christmas, Michael. How can I help? Thank you. Merry Christmas as well.

I, let's see, have a question about purchasing a home. We have about $70,000 saved up right now. Hello? Okay. Oh, okay. About $70,000 saved up right now, and that's above our emergency fund. Good. So we're debt-free.

Good. And we have our first baby on the way, and we'll be arriving hopefully next June. So my wife is going to be staying at home. So we're going to go from about $110,000 down to about $75,000. So my question is, I've been playing around, or we've been playing around with three options, either buying a house now with that cash that we have, so maybe around $70,000 or $80,000,

and then move up to a nicer home within about four to five years, or buying a duplex now and then doing the same thing, moving up in about four to five years. Or the third option, just rent until we have maybe $50,000 or $60,000 more to get a nicer house that we may live in for a longer period. So just looking for your wisdom in that area. I would buy a single family now in cash. Okay.

And then let that go up in value and keep saving. You'll have no house payment. You'll have no rent payment, which will increase your ability to save, and it's going up in value. And so you sell it when you get your other 50 grand together and you move up. But you'll get it together faster by doing that than you will that money sitting in a savings account. That makes sense?

Yeah, that makes sense. Because you're freeing up the equivalent of a house payment a month. The difference is it might not be exactly the place you want to live in, but the good news is you're not going to live there that long. I mean, you're making $75,000 a year. She's at home with one kid, and we have no payments in the world, no house payment even. Wow, way to go, Michael.

You killed it. And then you just save like a crazy person. So what, if you save $25,000 a year, that's two years. You'll have the $50,000. You move up. Or maybe it's just a little bit more. I don't know. Maybe it takes three years. I don't know. Maybe it takes three years.

I don't care. But that's not that long to live in a place and then turn around, sell it, make money, and move up. Marsha's with us in New York City. Hey, Marsha, welcome to the Dave Ramsey Show. Hello, David. Pleasure to meet you. I have just a general question.

I'm a single mom. I have a home, and I'm about $76,000 in debt. I am on baby step two. I know I can list my house on the market right now for $250,000, but I'm just trying to figure out if it's in my best interest to sell the house or to stay at this point. And ultimately, when I do move, I plan on relocating to be close to the family. Okay.

So your long-term game plan is to leave New York City and move where? Moving to Florida. Okay. And what is keeping you from doing that now? My child is in school, and I just waiting until she um finishes school in the summer okay all right and so you wouldn't what would keep you from just putting your home on the market in april or may with a closing date no sooner than the last day of school and you head to florida What keeps you from doing that?

Well, basically I'm just trying to see if it's the right thing to do at this point. I know I have a little bit of equity in the home. What keeps me from doing it right this moment? What would make it the wrong thing to do? Well, the wrong thing to do is to not making sure that I end up getting everything. The wrong, I don't know. Honestly, I'm not sure. I don't know why you would not, if your goal is to go to Florida, why you would not just sell the house and go to Florida?

Right now? No, when school's out. Well, I'm just trying to see if it's... No, you would not stay in New York for three more years just because the house is going up in value. Okay. No, you leave. You're not, you're, you know, if it's a good thing to leave and be down there three years from now, it's a good thing to leave and be down there now, assuming you have an income down there.

Yes, my job will, I'll be able to relocate with my job. Okay. So there wouldn't be an issue at all. Yeah. I'm heading. Okay. Okay. Okay. All right.

Well, it was good to know because I was just not sure, and I was just divided between the two plans because it's just I'm on baby step two and I'm trying to stay there and I'm not trying to allocate any more money. Like, I have no more money to put into this house basically at this point. Right. But it's not and i mean it'll it'll sell won't it oh yes um i'm actually using one of your elps and they they assure me that the house will definitely sell but it's just a matter of i guess if anything

that comes across you know how things come up when you're selling a home where things gotta get fixed so i'm just i have no money for that. Right. Well, you just have to tell the real estate agent that, you know, whatever deal we do here is going to be as is because I'm not in a position to fix a bunch of stuff because I'm in baby step two and paying down my debt and I don't have a bunch of cash laying around to do a bunch of work. If somebody's requiring work, we've got the wrong buyer. We're going to have to get a different buyer.

Okay. So what is the house worth today right now in the market in my area it's worth about 250 and you owe what i owe 212 okay all right so you can get it sold and get out of it but you're not going to get any real money and then when you move to florida you're going to be renting until you get your debts paid off and save up your down payment above your emergency fund. Jesse is with us in Atlanta, Georgia. Hi, Jesse.

Welcome to the Dave Ramsey Show. Hey, Dave. Merry Christmas. Merry Christmas to you. How can I help? Yes, sir. I have a question about some student loan debt. My wife and I are actually expecting our first child in January, and naturally our income level is about to change.

My wife's going to stay home with the baby for anywhere from six months to a year. Congratulations. Thank you very much, sir. So my question is in regards to paying off the student loan debt. It's roughly $10,000. Besides our mortgage, it's the only debt that we currently have. And my question is in regards to is there any way to negotiate? I know you can when it's in a default stage,

but is there any way to negotiate a payoff for that debt? No. No. Not even when it's in default. The only thing that you can negotiate on a student loan is late fees or maybe some other gotcha fees of collection fees or something like that. But interest and principal are guaranteed by the government, so they have no reason, if you don't pay it, the government's going to.

They have no reason to negotiate it down. So a federally insured student loan, I mean, it's just that. It's federally insured. So you're not going to negotiate it, and it won't work. So, hey, thanks for the call. We appreciate you joining us. Merry Christmas to you. Open phones at 888-825-5225.

You jump in. D is on Facebook. Would you consider phones a debt that are being paid for in installments on an existing phone bill? Yeah. Yeah, you didn't pay for your phone. You borrowed for it, and they loaded the payment into your phone bill. That's not a plan.

So definitely, yeah, that's definitely one of your debts and something that you'd want to pay off and make plans the next time you get ready to purchase a phone that you pay cash for it or you don't upgrade your phone this time. They make a ton of money by slipping that stuff in there. And it's slipping a payment into your payment and just continually upgrading you and make you feel like that somehow you got taken care of. And that's not a plan at all. So, no, we don't finance anything around here.

No, this is the Dave Ramsey show. We don't borrow money. It's a pretty easy equation, D. Listen, here's the thing. It's those little things like that that'll kill you. You gotta watch the little stuff like that. The Bible says the little foxes spoil the vine. Yeah, it's almost like mischievous financial stuff that's busting up into you and messing you up.

So you've got to watch the little stuff. It'll get you. This is The Dave Ramsey Show. I'm going to go. Dashing through the snow in a one-horse open sleigh. O'er the fields we go laughing all the way. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. You jump in.

We'll talk about your life, your money. It's a free call. James is on Twitter. Can I sign up for a local Financial Peace University class? Sure. How much does it cost? It's $129. And that gives you a year of every dollar plus, which is a $100 item.

It gives you a year of access to the online videos and audios, as well as the kit to go to class. And all of that is only $129, and that includes free shipping. So very cool stuff. Things are really moving over at Financial Peace University right now. Woo! Man, is it on fire. This is the time to do it.

If you want to lead a class, by the way, there's a lot of them needed. A lot of people want to go to these classes, and a lot of people, well, we need some help leading them. So if you've ever considered being a financial peace university coordinator, this is a really needed time. Edwin is with us in Los Angeles. Hi, Edwin. How are you? Thanks, Ed. Doing pretty good.

Appreciate you taking my call. Sure, Edwin. How are you? Thanks, sir. Doing pretty good. Appreciate you taking my call. Sure, sir. How can I help? I've heard you mention the richest man in Babylon before. Paying yourself first is very important. I have $30,000 in credit card debt. And just recently, everything went through and I've got my pension from the military, so I can pretty much allocate about $2,000 a month towards, I just paid $11,000 of student loan debt, so I'm happy about that. Mm-hmm. And I'm 32 years old, just turned 33.

I don't know, talking about the power of compound interest and all that, should I pay myself first and open up a retirement account or Roth IRA account? No. And while I'm paying, no? No. The power of compound interest is absolutely real, and it's very important to get that on your side. But your most powerful wealth- building tool is your income and right now being in debt too much of your

income is going to other people so the first thing we teach people to do is to clear their debt everything but your house completely focus on that stop all investing temporarily so that when we get back to investing, we can do it with style and with, you know, put the hammer on it. But we temporarily stop investing. And that's, you know, so that you can completely focus on the debt. Then when there's no debt, boy, you can focus on the investing. And what little bit you lose in the next two years while you become 100% debt-free in compound interest, you will make up for, well, tenfold by being able to invest the rest of your life by staying debt-free, becoming debt-free and staying debt-free.

Number one key to becoming wealthy. Melissa is with us in Baton Rouge. Hi, Melissa. How are you? So I'm 29, and I have a decent job, but I've been going to school for engineering to hopefully better my opportunities. I have a lot of debt. I've been cash-flowing school, but I have a lot of student loans and other stuff,

and I wasn't sure if maybe I should put that on hold for now, the school, I mean, until I pay off my debt. How much do you lack finishing? Working full-time, realistically, I probably have like another five years. Okay. And you're single? Yes. Okay. And you're single? Yes. Okay.

And how much debt do you have? So I have a mortgage of $165, student loans $78, and about $12 in credit cards. Okay. Ouch. And what's your income? My base pay is about $65, but the last couple years with overtime, I've made about $80. Good for you. Okay.

All right. Well, and what's school cost? I'm paying about $2,500 a semester. The student loans is from like 10 years ago. I made a lot of bad decisions. I took small ridges, and the interest has killed me. Mm-hmm. Okay.

All right. Well, I mean, you want to be an engineer i don't know how much your income is going to increase from what you're making now as an engineer not tons and depending on what type of engineering you're studying and you know what type of job you move into but there's a lot of engineers make six figures and that's about it so um you know you're already almost making that so it's not like your income's going to double or something unless you're studying a particular type of engineering that has a rare application i don't know what you're doing but um if your income's not going to go up dramatically as a result of this then i would just

take my time and time and cash flow it as I go, and then, you know, let's work this debt down. But $2,500 a semester is not keeping you making $80,000. It's not keeping you from working your way out of debt. You still can work your way out of debt while you're doing that. Okay. And it's just a tight budget, and, you know, you're focused. You have two goals that are big goals right in front of you

and that's knocking the debt out and finishing up this degree as fast as you can and cash flowing it but you know 2,500 a semester that's five thousand dollars a year out of 80 grand that's not keeping you from making progress on your debt and um and so i i think you continue to work on the degree i would want to get the degree it's just part of your plan part of your process to get there but uh but just make sure you're paying down the debt while you're doing this todd is on the line in miami hey todd how are you hey good thanks david better than i? Better than I deserve. How can I help? I just have a question. So I found your videos a little while back,

and technically I'd be on Baby Step 7 except for a car lease. So we have one car that's paid for in full, and then the other car is a lease. I just wondered what your suggestions might be based on kind of our current income level. So your home is paid for? We're out financially. Your home's paid for? Yes. Cool. What's it worth? About $500.

$100? Yes. Okay. And your household income is what? $180. Very good. Good for you. So what does it take to pay the car lease off? Just a little over $30. Well, do it. Just pay it off.

You like the car? Yeah, it's okay. I don't know if I'd get it again. Well, do it. Just pay it off. You like the car? Yeah, it's okay. I don't know if I'd get it again. Okay. Well, let's pay it off. Yeah. You got any money? Yeah, we have quite a bit.

We have about 15 months of expenses. Okay. So you got the $30,000? Yeah, definitely, yeah. Well, write a check and pay the car off, or sell it if you don't want to keep it, but let's not be driving around a car payment. Okay. You can afford a $30,000 car making $180,000, and you've got the money to pay for it.

So I'd just clear it. I'd just be done with it. No car payments when you make $180,000 and have your house paid for. No, I'm not going to have a car payment. Absolutely not. It's just cleanliness, man. We're just cleaning up the corners here. You've got dust in the corner.

Thanks for the call. Open phones at 888-825-5225. You jump in. We'll talk about your life and your money. Dave, what retirement options make sense for a small business owner? Well, on the SEP, the S-E-P-P plan is one to look at, Simplified Employee Pension Plan. If you have employees that have been with you more than three of the last five years, whatever percentage of your income you put into that, you have to put the same percentage of

their income aside for them. So it's usually used for single person small businesses, meaning you don't have employees. That's how it's usually used. Now, if you have employees and you're not going to use a SIP, then what would you do? It's called a simple IRA, and all it is is a 401K for small business. And it's very inexpensive to set up. Very good plan. The only thing that it has required to it is that 3% of employees' income has to be matched if they put money in. So if they start putting money in, you have to match them up to 3%. Now, you can set a qualification that says they have to be with you 90 days or six months or a year

before they can start in your 401 your simple 401 and that's what i did when i first started i i you know we started with a set then i got employees and went to a simple and then we've of course larger company now with almost 700 people working here we have a full-fledged regular traditional 401k now. But the simple 401k is an excellent, excellent plan. I'm a huge fan of that. A simple IRA. It's a small business 401k is what it is.

And it's just really, it's excellent. Love it, love it, love it, love it. Really inexpensive. Good way to put it together. You can check with our SmartVestor pros at DaveRamsey.com. Click SmartVestor and we can help you set that up if you want either one of those, the SEP or the Simple IRA. This is the Dave Ramsey Show. Hey guys, this is Blake Thompson, Chief Production Officer for the Dave Ramsey Show. Here's a tip. To keep from missing Dave's classic facial expressions to some of those calls,

make sure you watch him live. Just visit DaveRamsey.com slash show each day from 2 to 5 p.m. Eastern. Enjoy.