The Ramsey Show - App - I Make $100K and Live Paycheck to Paycheck (Hour 2)

Episode Date: June 27, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Rachel Krug is Ramsey Personality, multiple number one best-selling author, co-host of the Smart Money Happy Hour, and my daughter is my co-host today. Open phones at 888-825-5225. Samantha in Vegas starts this hour off. Hey, Samantha, what's up? Hi, how are you doing?

Better than I deserve. What's up in your world? Well, I called in because I'm just tired of toiling in debt. I have been a single mother of six, and my youngest is now 21. Yay, you got them out. You did it, Mom! You did it! I got him out. Did they all survive? Way to go! Into that next bedroom.

No, they all do really well, very well. However, except for the youngest one, he's still finding his way. But, you know, during the course of this, I find myself in close to $100,000 in debt. I am still paying my youngest car note. I'm paying one of my children's college debt still. She graduated NYU. So I have a little bit of debt there. And I'm back in college. So I just don't even know where to start to attack these these bills with me already from paycheck to paycheck. Okay why does a 21 year old need his mommy to pay his car payment? Because it's his mommy's name and uh he did not he's not working yet well he was working but they just laid him off, so I bought it for him as a graduation gift.

You bought him a car payment. Okay. How much do you owe on your car? I owe now about $12,000. What do you owe on his? Oh, on my car, I owe nothing on his $12,000. Oh, I see. Okay, so what's the other $88,000 in debt? NYU? Yeah, it's NYU, and then, of course, credit cards. How much is credit cards?

Oh, gosh. Credit cards is around $3,000 or $4,000. The rest is NYU. So you got $84,000 for one kid? Yes. Wow. Yeah. Was it a Parent PLUS loan, Samantha? Is it in your name or is it in her name? It's a Parent PLUS loan, Samantha?

Is it in your name or is it in her name? It's a Parent PLUS loan. And she does work for, I mean, she's in a situation where her loans can be forgiven, you know, after so long. I'm not. Parent PLUS, you're on the hook for. Nope. You got to pay it. So what do you make?

Well, I make just under $100, but with bonuses, I make about $110, $115 a year. What do you do? I work in health care. What are you studying? I am studying to get my bachelor's so I can move into a higher position in health care into a director's role. And what are you paying for that? You know, the company does reimbursement, and I'm doing Sophia credit, so that's really,

I'm not really paying for that. Just taking up time. That's good. Just opportunity. Very wise. Good for you. How long is the program, Samantha? Oh gosh, if I keep doing the Sophia credit, that'll be done by mid-next year. Okay. Excellent. That's great. Great. Yeah, I'm trying to fast track that. And then what will you make if you're at about $110 with bonuses for the new position? What are you expecting?

With this company? You know, it'll probably start around $120 without bonus. Probably $130, $140 with. Okay. Good. Well, you're making progress good for you how old are you 55 uh you're good i'm 53 i'll be 54 okay well i mean you told me your story your story leads to that um okay good good okay well you're a warrior princess i mean you fought through raising six kids by yourself you're amazing You could fight through a lousy hundred grand in debt.

You could do it. In this lifetime? Okay. Are you ready? Are you ready to get after it? Because, you know, you're used to fighting battles, and I'm getting ready to put you on the front line again. Draw your sword. You ready to go?

I am so ready. I got my pen and pad, and I am so 100% ready. I'm tired. I mean, the first thing I would do, Samantha, is I'd cut up your credit cards today. I'd get rid of them, thing I would do Samantha is I'd cut up your credit cards today I'd get rid of them and I would force yourself to live on less than you make with the income you have and that's going to include these debt payments staying current but it's going to force probably a different lifestyle to a degree I know you're I know you're not out there all bougie and glamorous and stuff but I mean it's going to be like hey I'm going to be eating in

more I'm going to be cutting it out I'm going to. But I mean, it's going to be like, hey, I'm going to be eating in more. I'm going to be cutting out. I'm going to be cutting subscriptions, extras. Like it's going to be putting you on a tight budget, living below your means without credit cards because the credit cards have become the slippery slope for you. They're kind of your safety net. And I want Samantha to be my safety net.

No life. And then I have, I mean, and then honestly, Samantha, the car loan for the son and that's going to be a really hard conversation but it's but it is a hey we're either transferring the loan in your name son or or i don't even know i wouldn't even do that i think i would just sell it i mean i would get to a point where you're like no i know i would say listen honey you got you got 90 days to get your button gear with this car and Uber Eats and everything else and pay it off. Because otherwise, I need to sell it because I'm getting out of debt.

Okay. That was my question. Give him a little time to come up with $12,000. And if he'll work 24-7 between now and Christmas, he can pay that car off and then keep it. How easy is it to transfer the time? I mean, he'll have to pay it off, though. But if he gets behind on payments. If he gets behind on payments, he's done on payments it's done it's done instantly right

he's either paying the payments starting today ready set go or we're selling the car and he's going to pay it off and get it out of your name because we're getting you out of debt because this is a this is a at best a contingent liability meaning you have to pay it if he doesn't uh at worst it's just straight up you owe the money on the car so rachel's right about that but what i want you to do is get on the every dollar app we're going to put you into financial peace university i know you're already in class but i'm gonna put you in another one and show you and teach you how to handle money properly i'm gonna pay for it because i think you're cool oh i think you i think a woman that can raise six kids as a single

mom's a freaking hero and so i want you to go win it's time for you to go win for you but that's no eating out no vacations no whining no life until we get this stupid nyu thing off the books we're not waiting around on her to work a stupid horrible backwoods job so she can maybe get forgiveness that doesn't come through most of the time on the loan. Instead, I want you to just pay it off fast. I want all these loans gone in two years. Oh, wow. Okay. Yeah. Oh, that would be great.

Yeah. Well, I'm talking about $4,000 a month. Gulp. Yeah. Okay. Yeah. Okay. Yeah. That gets you out of debt in two years. And that means you have no life, you're working all the time,

and you're eating tuna fish sandwiches at work. Hello? And if there's extra. By the way, I hate tuna fish. Yeah. Well, I've been in the doctor's lounge, so I'm good with that part. I used to eat it when I was broke, and I smell tuna fish I smell broke I can't stand it so Samantha is there is there a lot of opportunity to pick up overtime a lot of health care in that

industry we find a lot of people are able to get some great overtime opportunities is there well I'm salaried and um you know I'm I'm a department head in the patient access care department. So it is a little different. Okay. Is there anything you can think of as a side hustle while you're going to school that is possible? I have truly thought that up, and I really don't. The only thing I have is, like, you know, a Uber Eats or something, and I can't really, you know, I can't do that. You've got to get through school.

I want you to get through school. I think that's important because that's a better future play. But I don't know. I think you can do this if a boy child takes care of his own car and you lean into this and you chop up the credit cards, like Rachel said, and we get you on an every dollar budget. I think you can do this in about two years. I really do. And then you're going to be up another 40 grand in salary that can be thrown to this next year when you get your new position. That's going to help. That's going to help you do it even faster. Hang on. Christian's going to pick up, and we'll get you signed up for Financial Peace University.

We'll show you how to do this, kid. It's what we do. This is The Ramsey Show. Rachel Cruz, Ramsey personality, is my co-host today. Thank you for joining us. Chris is in Bozeman, Montana. Hi, Chris. How are you? Good, Dave. Thanks for taking my call. Sure, man. What's up? So I'm going through a job transition right now, and I'm hoping I'm not shooting myself in the foot. I work for a company

down in California, and I live obviously remote. I'm taking a slightly lower paying position to try and improve my quality of life. You work remote. Well, I work remote, and if I'm not remote, I'm traveling all around the country. So where's your quality of life going? How often are you traveling? It depends. It's kind of sporadic.

I never know when I'm traveling. The most recent request, they called me at 10.30 p.m. on a Wednesday and wanted me to fly out the next morning, Wednesday night. Is that normal? No, that's not typical. Okay, so that's an exception. What's the average month that's killing you look like well again it's sporadic i had six months in a row where i was gone week like every other week i was gone for a week so i was home for a week traveling for a week home for a week

traveling for a week okay and then now i've been sitting at home so what were you making probably three uh 70 salary plus benefits and what are you making now i'll be making 30 an hour with the opportunity for overtime but no benefits what's that translate to six i'm sorry 60 days i think it's 60 days 60 so you're going to take a 10 000 pay cut but with ot possibility and loss of benefit yep and you're at home and it's a 40-hour gig uh when i'm home it's 40 hours when i'm traveling it's oh it's now travel the new one's got travel the new one's not traveling local home every night with my wife that's what i said yeah you're taking a 10k 10k pay cut you're coming off the road yeah yeah but my travel time like if i'm traveling that's a 60 hour week sometimes

or typically was you know yeah so i don't get paid for that overtime so there's new overtime if i have to work a 50 55 i gotcha you'll get paid for it i see i see what you're saying yeah does the new job include travel no no it won't i have to drive around my local town no yeah he's saying i'm trying to get. I'm trying to get a handle on it. All right. So, okay. Anyway, so your question is, did you goof up taking that? Yeah, am I making a bad financial decision?

Because I do have some credit cards. Only if it doesn't take you where you want to be when you're 10 years older. How old are you now? 33. Okay. Is the 43-year-old mad at the 33-year-old you? Not from what I can see. Okay. All right. Then you're fine.

So I don't want you to take a permanent step back, but taking a step back to get your life under control so that you can step forward. In other words, does the new position have some upward mobility, some things you can do with it over the next decade? Does it take you where you want to go? But if you're taking a job you're just going to be stuck in and you're spinning your wheels and you're going to make less and you're going to make less and you're going to make less

and you're going to make less, then, yeah, I would have taken another job. I don't necessarily think you have to stay with that old job. It was a bad gig for you but um but but i you know i don't hear anything here that's devastatingly bad if you took a pay cut in half uh i would say you really screwed up but um uh you know and his point too was the 70k included weeks of travel and you don't get paid for those extra you know so like even if he picked up some ot if he worked the same number of hours at the new gig he'd make 70 that's right or more yep that's right that's right if they'll give him the ot but i don't know if they will or not yeah and especially if you're in a position where you guys can live on that and

you're not putting your family in a financial dire strait like i just know for our season of life like yeah if you have the ability to not be gone for a week, if you're married with kids, that's real nice, real nice, you know? So that's fair for sure. Absolutely. Now, in general, for folks out there, sometimes when people say work-life balance, you mean all kinds of different things all right um and uh sometimes people uh i need to leave this

job that's toxic or i need to leave this job that is horrible and i'm really not referring to chris at all i'm just referring to the subject then um you know i and the only way i can do that is to make less. Well, I would challenge that. There's two times that people come to us in the last 30 years, and they come to us every week with these two times. I want a better quality of life, and so I'm going to change jobs and make less. Number one. Which he's not really making any less probably. But the other time they come to us is I lost a job and the new job I'm going to get that I don't

even know what it is. They assume is going to be less. Both of those are wrong answers. If you have answer A, a job that's miserable, answer B, a job that makes less, you have not enough answers yet. You need C, none of the above. Remember taking multiple choice? C, none of the above. And none of the above means I want a job that's not miserable or that is a new job because I lost my old job that pays more.

And guess what? You won't find that if you don't believe it and aren't looking for it. People have a negative assumption immediately that in order to be happy, I have to make less. Well, let me help you. You're happier if you make more. And in order to get a new job, you have to make less. What? Hold on.

Unless the new job is terrible, you don't feel happier if you make more in your situation. I know, but this idea that the only way to be happy is equated with working for a nonprofit and I make less money than I've ever made in my life. No, no. That's just dumb. But I do think there's an assumption that if you've been in a company and you continue to get raises within internally and then you step outside that it could be harder to find the same equal opportunity

not if you not if you earn those raises because you're qualified to run that position that you're doing at that company yes well and I would say if you're overpaid because you got promoted beyond your competence sure then that would be true and i will say out in the marketplace to find the job that pays more is out there like we see that a lot you know all the time you're getting paid 20 grand more i mean like it's all it is wild we see that even from internal and we've had people leave here because they get paid 30 grand more yeah hey i'll help you back that's great man it's awesome happy for you so yeah there are there so to your point though you you don't equate okay i'm gonna have a better situation because of the toxic work environment i in or the schedule that i hate that i'm in i can find a job that i love and enjoy and i can make the same or more and that

i'm passionate about and good at yes all those things and make more right so that this i but but the human nature is to assume the negative yeah yeah and i'm saying push back against that as an act of your will and assume the positive good stuff all right renee is in st petersburg hi renee welcome to the ramsey show hi dave hi rachel thank you so much for taking a call sure Sure. What's up? I just have a quick question. I was wondering, I'm on baby step two, paying off my car, and now the engine needs to be replaced, and it's an $11,000 repair. I only have $1,000 in emergency funds, so I'm wondering what I should do. Like, should I take out a personal loan to get the car fixed? No, no, no. That car is gone.

How much is it worth? Well, with the engine needing to be replaced, it's worth $5,000, and I owe $20,000 on it. Holy grail. If it had a new engine, it would be worth $15,000. Wow. Oh, but if it was fixed, it'd be worth $15,000. Okay. Yeah. Are you single?

No. I'm married all right um the two of you need to sit down and understand that there's lots of places to buy car engines and the car dealer is the worst one eleven thousand dollars for an engine the flip are you doing buying nascar no you're broke you're going to a junkyard and get a used engine that has 20 000 miles on it the car got totaled and you're going to have some guy under a tree put it in out back of his house that's called a shade tree mechanic by the way and it's cheap and that's how you do it no and that's going to cost you three or four grand and you're going to save up money and do that real fast you know eleven thousand dollars no no no no no no no

no i don't think they don't even call them junkyards anymore they call them salvage yards so you call you call a salvage yard and just say i need an engine i'm start and they've got it's all computerized now. They'll shop all over the nation. There you go. They'll have you an engine. A guy under a tree. That's not what I was expecting.

It's a shade tree mechanic. It's an old saying. Y'all heard of it? Anyone out there? Everybody. Oh, my gosh. Okay. Thank you.

Okay. Thank you. This is The Ramsey Show. Rachel Cruz, Ramsey personality. My daughter is my co-host today. Our question of the day comes from Brandon in Maryland. He says, I've had several friends whose parents took out our parent plus loans and had them go sideways once they graduated.

What's your stance on them obviously they're a bad idea but if they were taken out whose responsibility should it be to pay them once they come due well i mean legally it's the parents um name on the bill and so i mean i guess from like a legal perspective it's the parents. I mean, what's frustrating about this whole thing, though, is that, and we've heard this multiple times, is that, you know, the student agrees with the parent that they'll pay it, you know, but the parent takes out the Parent PLUS loan. The student fails to tell their new fiancé. Or the student doesn't get a job.

Mom and dad go, you remember that time you said you were going to pay this loan and they go no i didn't yeah that's what happened we hear that all the time don't we well that or the student didn't pay and the parents like well i guess i have to pay it and then they're frustrated i mean like it's just it ends up being this like tangled mess relationally uh but whose responsibility once it comes due i mean whoever promised to pay it morally if the kid promised to pay it then they should go back and pay it they're not legally liable so if you if the kid if you said mom and dad if you take this loan out so i can go to the college of my dreams then and mom and dad are stupid enough to go do that. Then they sign the note. They're legally liable, but you made a promise to them to pay it.

That's you keeping your word. You go pay it. Okay. Mom and dad took out the loan and nobody ever said anything to nobody. And then mom and dad come back later and go, you need to pay for your college. No, I don't. I didn't tell you I'd pay it and I'm not going to pay it. So there's no moral contract and mom and dad are up a creek bottom line is you can avoid all this by staying away

from the stupidity completely no student loans of any kind are good in no freaking circumstances parent plus loans are stupid that'll help you yeah there you go it's hilarious to me that when people are stupid about education that's an oxymoron isn't it we've lost our stupid minds on the subject of education i will say do you feel like in the most in recent years in the last two years or so since covid i feel like people have woken up to this though i think that they're in loans yes i think that there has been a backlash against just collegiate in general like just i mean i think people are higher education has gotten a backlash in general yeah i just think that there's some of it was they wanted to charge you the same amount while you were while they

wouldn't let you come to campus yep and made you work made you uh study remote and they wanted to charge you the same amount while they wouldn't let you come to campus. Yep. And made you study remote, and they want to charge the same amount. And everybody went, well, listen, I was already getting ripped off, and this is really screwing me. I don't think so. But, I mean, I think it's waking up. And I hope that Borrowed Future, our documentary that was award-winning and highly viewed, had something to do with it. If you haven't watched that, you can watch it on youtube free and um and many other streaming services as well but it'll blow your mind how crooked and backward this whole student loan thing is and the politicians you guys

you congress people somebody ought to just smack one of you y'all are just it's unbelievable the student loans are horrible we need to forgive them while we continue to make them that's so intellectually dishonest if they suck and they hurt people why don't you stop it hello the poor little victims of the student loan is and you keep making them and you're the villain congress it's your fault if you just stop it nobody would have student loans that'd be an awesome thing and the universities would probably lower tuition because nobody should they would because people couldn't afford to pay it this the demand people would wake up and go wait a minute this is like real money in my hand that i earned i I'm going to make better value choices about what I study. I'm not going to study left-handed puppetry and pay somebody $85,000 a semester for that

and call it an Ivy League education. And I'm furthering my thought patterns. Oh, bull crap. You're just shoveling money out. And by the way, it was my money because I'm the taxpayer, and now you're not paying it because you've got a degree that's worthless and you're a barista. And so that's what happens.

It's just the whole stupid thing is a scam. And so higher education is to blame. The Congress is to blame. Weak parents that won't tell their spoiled freaking children no are to blame everybody in this thing and you used to say it a thousand years ago before we had borrowed before we had borrowed future and all of it out you said we don't have a student loan problem we have a parenting problem because you talk to these college students to your point that graduated 21 years old with 120 grand in debt to

not an Ivy League. I mean, they're charging insane money now. And they want to go and be a missionary or do something, you know, where they're not making a ton, but they got all of this debt. And I'm like, well, how did your parents direct you? Well, they didn't talk to me. And you're like, oh my gosh, like an 18 year old is sitting here making a decision that's going to affect them for the next decade of their life. And a parent didn't step in and at least have the conversation. Like, nothing is being said. Or we get a call like, my daughter told me she's going to this school that we can't afford, so we're going to have to take out student loans.

See, there's the problem. Because I love Rachel, but when Rachel was 18 and we were spending my money, she didn't tell me nothing. I told her some stuff, but she didn't tell me anything. That's not how this works. That's backwards. There wasn't much dialogue. No, there wasn't. It's like, you're going to go to this school, and I'll pay for it.

That's pretty much how it went. All three of them went to the same school. The dialogue was, if you take all these classes, graduate in four years so take the freaking classes yeah that's fair because yeah and i did that was the dialogue and to be transparent you guys paid for our education but we had to stay in state yep we had to take in-state tuition and we had to graduate in four years if you went four and a half you had to freaking behave and if you did yeah and if you went out of state you don't get to go off the reservation and get my money that's not how it works i'm not

going to support your freaking insanity that some communist professor told you to engage not gonna do it you know i went partying in my head i went partying in college if you went off the reservation that meant partying not well i'm talking about losing your freaking mind and you know you're i'm gonna you're confused what you're there for you're there to take these classes to get this degree and if you take these classes and pass them it's magical you graduate in four years and and the uh we go we're sitting in the orientation at the university of freaking tennessee where the kids went and I went, and they said very proudly, we have a 57% graduation rate. Of the people that are sitting in this room, 57% are going to graduate.

And I'm thinking to myself, I almost raised my hand and said, if they make a 57 in class, don't you give them an F? You wouldn't be bragging about that. That's called failure. Oh, and then they pipe up and say, and only 20% of the ones that do graduate will do it in four years. And I wrote across my oldest daughter's little orientation packet, so have a freaking plan in black magic marker

while this idiot was on stage telling us this i mean how are you bragging about a 57 graduation rate that's failure and this is another lesson that you take out loans and you may not even get the degree and you're paying money back for a degree you never received either yeah 43 percent of the time. Yeah. Apparently, you don't get the degree. Oh, well, Brandon from Maryland, question of the day. Hope that segment, that was for you. Well, I mean, really. Guys.

I know, I know. It's hard. You can go to college debt-free. You choose a school that is reasonably priced. It's typically an in-state school. $12,000 a year will put your little butt in a state school right now. 14?

It's getting worse and worse. It is. It's not going to be that fun. For free in most states, you can go to a community college for two years. There's a plan to go about it. It's not the most glamorous. You're not studying anything that matters

in the first two years anyway, usually. Yep. Yep. So there is a plan and it probably doesn't look like the shiny plan that you always thought was college. And here's an idea. Get a degree. It'll help you get a job. Whoa. That was insightful. This is The Ramsey Show. Rachel Cruz, Ramsey personality, is my co-host today. Thank you for joining us, America. The best way to make the most of your money is by telling it what to do.

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Free. Jarrett is in Indianapolis. Hi, Jarrett. How are you? I'm doing good. How about you, Dave? Better than I deserve. What's up? Just wanted to give a quick shout-out to Mr. Haney.

He put me on the Dave Ramsey show seven years ago in high school, so I just wanted to give a quick shout-out to him. He's been amazing, and he's the reason I know you, man. He's awesome. Love it. Love a good high school teacher. Good stuff, man. How can we help today? Yeah, so my question kind of comes more long-term than short-term so me and my wife were kind of thinking about buying a house like whenever

we kind of get settled in with the economy and everything and we're just trying to think about it long term because she wants to be a stay-at-home mom which obviously like would take away her income and we've talked about it she would be open to doing a part-time job, but probably not full-time, you know, with the kids and everything. So we were just curious on like, how do we save up for a down payment on the house whenever like that down payment, like it would be saving with two incomes and then we'd go down to one once we move in. So I'm just trying to avoid being house poor, honestly. Yeah, I mean, I would just do the math that you're, I would do the math on one income versus two. You could save up the down payment pretty fast

with two incomes, but once you guys move in and you want to go down to one, I would make sure the formula worked with that one income. Do you guys have kids now? No, no, it's like very long-term. We're just trying to plan ahead as much as we can so that when that moment comes, we're like, you know're we're ready for it yeah so rachel's right run your house payment on the remaining income after she comes home being no more than a fourth of

your take-home pay on a 15-year fixed but i wouldn't do that now i mean you guys don't do that today but when you're doing the purchase but you don't have kids right now so, you know, and we don't know what you're going to be making. Yeah, that's what I was going to say, too. So it's not what you make now. So right now your job is stack cash. Because here's the other thing. The more down payment you put down, the bigger a house you can buy with that exact mortgage. Let's say that at a fourth of your take-home pay you can afford 250 000 on a 15

year at your then income whatever you're making at that time and she comes home with and stays home okay then it you know obviously 250 000 is the loan amount but if you had a hundred thousand saved that means you're at 350 if you got 200 000 saved you're at 450 and so the bigger the down payment the bigger the house or the bigger you,000 saved you're at 450 and so the bigger the down payment the bigger the house or the bigger you know that you put down on the house so the less the payment a month or you take you know you take out less of a payment that's right then the formula allows but yeah um rachel's right you just need to be doing for today your job stack cash and then just be cognizant when the purchase time comes to run the formula based on the remaining income.

Because if you run the formula based on a fourth of your take-home pay with her income and then she comes home, you are going to be house poor. That's going to strap you. And that's not going to work for you. Travis is in Buffalo. Hey, Travis, what's up? How you doing? Better than I deserve, sir. How can i help well i was calling basically

because you know i've heard it said you know a lot of times basically in summation that your number one wealth building tool is your income i say it all the time right now for the person like myself i'm on the lower end of the income ladder. I'm bringing about $40,000 a year or so, and I've been paying attention to what you've been saying. And I was thinking, like, you talk about mutual funds and investing, and I have limited to no knowledge. So I was wondering how somebody maybe in my position could start to build towards

retirement. Okay. Yeah. Well, I can say this first and foremost, I think the phrase, and you correct me because you say it, but the idea that your income is your largest wealth spending tool, because your income, Travis, the reason we say that is because if you use your money for you, meaning for your investments, you're going to be earning interest for you versus if you have two car payments and a student loan payment and all these payments, debt, and your income is going to those things and then interest on top of that paying for the bank, you're making the bank wealthy versus making you wealthy, if that makes sense. So I think it's less about the exact number of your income. And it's more that philosophy of, hey, I'm going to use my money regardless of

income for me and making myself wealthy and not the bank. A Toyota motor credit being wealthy is not my concern. My concern is my family building wealth. And so I'm not going to give Toyota motor credit a car payment or whatever bank you want to name our car company you want to name so how old are you travis i am 41 good good for you what do you do i run i manage a restaurant good for you okay and how long have you been in the restaurant business uh about 12 years good for you it's hard work man a lot of hard hours too and you put up with a serious amount of crap um the um all right so our goals what we teach you is a process called the baby steps which is to first have a thousand dollars saved as a starter emergency fund then

second become debt free everything but the house, using the debt snowball. Third, build an emergency fund of three to six months of expenses. And then fourth, start investing 15% of your income. In your case, if you had no payments but a house payment and you save 15% of your income, well, 15% of $40,000 is $6,000. That's $500 a month. If you invest $500 a month from age 41 to age 61, you will be a millionaire. Wow. And that's if you never get a raise, and I suspect you're probably going to get a raise. I suspect if you can manage a restaurant in Buffalo, New York, you probably could manage a better restaurant in Buffalo, New York that pays $75,000 instead of $41,000. So some career goals are probably going to cause you to make more throughout your life.

I doubt you're stuck at $41,000 in perpetuation. It's just where you are today. Yes. Yeah. Well, I appreciate that. I mean, I should point out, though, I mean, I don't know if this would matter, but as of today, I have no outstanding debt. Good.

Okay, then you're on your way. You have an emergency fund of three to six months of expenses? Oh, yeah, yes. Good. How much do you have saved? Well, in the savings account, I got about $45,000, a little bit more. Excellent. Excellent. You are on your way, man a little bit more. Excellent. Excellent.

You are on your way, man. Way to go. Way to go. Do you have a 401K at the restaurant? Well, I didn't. See, when COVID came, I was with a financial advisor. And, no, the restaurant doesn't offer a direct, unfortunately. But when the market collapsed, she advised that we should postpone maybe looking into investing, you know, the beginning phases of that.

Yeah, okay. So let's get you somebody set up to do a Roth IRA for you and your wife, and let's get going. And let's get $500 a month going in, minimum. And it's 15% of your household income so if you're married and she makes money that's part of the formula too by the way and that accelerates things even more but uh if you want to know who we tell people to go to in your area just go to ramsey solutions.com and click on smart vester and you'll find a smart vester pro there that has the heart of a teacher and they'll sit down and show you the numbers i was just talking about you already know how to live on less than you make you don't have any debt

you already know how to save money you have 45 000 you're already a champion we've just now got to convert some of those habits into making you into an investor not just a saver and when you do that with your roth ira if you'll do that every stinking month for the next 20 years you'll be a millionaire promise you so folks the numbers are a hundred dollars a month saved from age 25 to age 65 is 1,176,000 now he's 41 not 25 but he's at 500500 a month, not $100 a month. You following my math here? I hope you are. I didn't just dream that number up. It actually ran through my little brain. This is The Ramsey Show. Thank you.