The Ramsey Show - App - I Owe More on My Car Than I Make in a Year (Hour 2)

Episode Date: November 7, 2023

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. I am Ramsey personality Rachel Cruz hosting this hour with Dr. John Deloney. And it is a free call anywhere in the country at 888-825-5225. Answering your questions about life, money, relationships, and work. So first up, we're going to go to... Hold on, it's launch day. Are we doing this again?

It's the second time. Okay, fine. It's launch day. It is launch day. I will sell your book for you because it's amazing. I'm glad for what I have. My new kid's book is out, you guys. I thought you were just being weird.

All on. Yes, that's the name of the book. It's so good. Oh, I'm not just saying I'm glad. I am glad for what I have. You should be because it's good. But the book is amazing. It's beautiful and it's well done.

Your drawings are so good. Thank you. I did not draw them. Lauren Gallegos, I'll give you a shout out. But yes, the illustrations are precious. So if you have kids in your life, you know kids, you have kids. This is a great book, especially for this time of year, because it's all about contentment and learning that what we have is not going to fulfill us long term. And us adults need that message too.

Can I say this? Yes. This doesn't get enough publicity. One of the last time I looked, I think it was number one, but I don't want to, I don't want to be that strong on it because I haven't looked at the literature in a couple of years. One of the very tip top things when they distill down what, what can a parent do to help your child be successful? One of the tip top things. Read to them. Is not get them into a fancy school, not to, it is to read to them every day. Yes. Get children's books and read to your child every single day. 10 minutes, 30 minutes,

read to your child, read to your child, read to your child. And it changes their mind. And Rachel, this is an awesome book to start that. For families who don't read, this is a great way to start. That's right.

And it's short. So you're welcome, parents. You are welcome. And it's at my reading level, which makes me happy. It has rhyming words for John. All right, we're going to the phones. And first up, we have Judy in Raleigh.

Hi, Judy. Welcome to the show. Hi, Rachel. Hi, John. Thanks for having me on. Absolutely. How can we help? Well, I've been specifically waiting for John on this one.

Oh, John, here you go. Pitches to you. My husband and I, so I'm like the budgeter and in charge of the finances. I pay all the bills out of our joint account, all that. I've been listening to Ramsey for years. I'm super no debt, all of that kind of stuff. We did have some debt. We paid down to $600.

We're almost done. But then within the last month, I found out that my husband has actually committed what the term is uh financial infidelity um to the to the tune of fifty thousand dollars um i'm sorry joe yeah um the reason i'm i'm not um like in tears is because I've already done all that. And so what happened was I found out we have meetings about money. And I recently heard some advice that instead of just having meetings, I should press to see all of the accounts. Like what are the statements? Let me see the, you know, show me your phone, all that kind of thing.

And he had been avoiding that. And now I know it's because there were balances that I did not know about. What was he spending that money on, hon? So I now have the pass codes to everything. And it was just groceries and gas and kids need this. There was nothing extravagant. It's just he was spending more than he was making. And I'm a stay-at-home mom, so we just didn't have the income so he had run up credit cards got a seventeen thousand dollar personal loan to pay them off last year and then end them up ran it up again to twenty four thousand dollar another twenty four thousand dollar loan this year

uh just two months ago judy have you seen those statements yes i've seen everything now i've seen i i got his credit report um i've got um we have we have this the joint banking account but we each have a checking um so i i have his law i have his passwords i have everything well i here's what i'm here's what i'm getting at it's very it happens it there's no question happens yeah fifty thousand dollars is a lot of money yeah it's a high it's a lot yeah and it's very rare that the nickel and diming of groceries here soccer uniform here it doesn't include a hotel room here a trip away here alcohol or gambling over here i've pulled every single statement okay and he's he's, he's, so the largest things are he's $250.

He's loaned to his sister or, you know, something like that. There's nothing I've asked him down to $60, $25. There's a $10 charge. What is this? There's interest.

There's late fees. He hasn't been paying them on time, but there's hundreds of dollars of interest and late fees, um, on, on all of the cards. And I think what, what hurts me the most is that he, I'm always talking about money and I thought we were together. Um, but we were not. And he, he, his explanation is that, well, he doesn't really have an explanation. He's very humble. He told me he's very humble he told me he's ashamed he told me he's embarrassed right he's sorry um he feels like he wasn't able to provide

for us there really isn't anything like i said i've combed through i've printed statements i've highlighted i've asked about everything i've added things up and he just was swiping his card he just we just didn't have the money okay so i start FPV today because I pushed for that. Because mindset-wise, I feel like we're just not, we weren't together. So what's your question, hon? How can I help? Well, something must have happened for this connection. Like, what do I do emotionally towards him?

I know there's the money part, but there's also the relationship part. Sure. So here's what's real important. You mentioned it, you kind of flew over it, and I think this is where you have to start, okay? And this is not a traditional infidelity advice. When somebody cheats on you, whether with another person, whether with money, whether with any number of things, I think you can cheat on your wife with a golf course. I think you cheat on your wife with work, right? With the office. I think you can cheat on your wife with a whole bunch of stuff or cheat on your husband with a whole bunch of stuff. I think honestly, we so narrowly define fidelity into the act of some sort of sexual act. I think

infidelity is way bigger than that, But we often focus on that thing, and that's what the Hollywood movies are made of, and that's what the big, oh, my gosh, and you talk to your friends. I think there's another thing that is more catastrophic, and that is this. You missed it, and you don't trust you anymore. You don't trust the ground you walk on. You don't trust the ground you walk on. You don't trust the cereal you're eating.

You don't trust your own radar system. And that, I think, is often as much, if not more disorienting than the actual act of infidelity because when he sat down and explained it to you and you went through every single thing, his story actually makes sense. He was a grown man who was ashamed that he couldn't provide for his kids and he just punted reality until it hit him in the mouth. I wouldn't advise that, but that story is plausible.

What's scary for you is the sidewalk you walk on, which is I can at least trust me. You don't trust you anymore. And so I think you start this process, A, with here's the four or five things I need on a daily basis so that I can begin to rebuild trust. Your marriage, as you knew it, was over. Y'all are building something completely new. Honey, I need these four or five things every single day. And you get to decide what those are and he gets to decide whether he's in or out. But more importantly, I want you to go talk to a professional counselor. In fact, stay on the line. I'm gonna hook you up with three months with my friends at BetterHelp. You have to start learning to trust you again because you're not crazy and right now you feel like you've lost in the wind.

Hang on. We'll get you hooked up with some professional licensed therapists. Today's question of the day is brought to you by Neighborly, your hub for home services. Here at Ramsey, we believe in making home ownership a blessing, not a burden. So we recommend Neighborly's nationwide network of service professionals to help repair, maintain, and improve your home. Find the help that you need at neighborly.com slash Ramsey today. All right. Today's question comes from Daniel in Oregon. I'm a 40-year-old married man with three young children. I have an Ivy League degree and an MBA from Georgetown. I am buried in both mortgage and non-mortgage debt. My total non-mortgage debt is $476,000. And my house has both a mortgage and a HELOC on it for a total of $881,000.

My total debt is $1.3 million. My wife doesn't work outside the home and i work as a consultant my gross annual income can range from 225 000 to 415 000 with commissions and equity payments i have no retirement savings no life insurance no will and struggle every month to pay my four walls all my credit cards are maxed out. I need help. Oh my gosh. Daniel. Well, before we like dive into the numbers of this specific scenario,

this is the classic example, you guys, of your money. It's 80% behavior. It's only 20% head knowledge. You can know what to do, but if you choose to live above your means, even with a close to half a million dollar annual income this is the result you get like you could out spend yourself

continually you can continue to do this so my first piece of advice to daniel is you have to fix you stop spending you have to understand why, what is all of this? What's the mindset that you guys are in? What are you, what are you, you know, it's almost like this, I don't know if it's the comparison keeping up game, if it's the, if it's like a medicated, you know, it's like a medicator just to go and spend and to get, like whatever the thing is that's causing these massive numbers

and this massive stuff of of 476 000 which i know is part education but also lifestyle you guys have to you have to look in the mirror and ask some serious questions about who i am and what am i doing did that got me to this place so let me just understanding you daniel is like it's a big part of this. But on a quick note, I mean, John, I may at this point just sell the house. Well, he's got to pay the HELOC off on it first. There's a point that like,

oh, the HELOC of $880. It's a total between the mortgage and the HELOC. I would probably sprint to try to pay the HELOC off as fast as I could. And by the way, wife goes back to work. Sorry, but y'all are not broke. Y'all are desperate, scary, broke. Wife goes back to work

and we pay this HELOC off and we sell the house. Yeah. Because we got to go back to square one. And here's what I was going to say earlier. My dad had a bachelor's degree from the University of Houston and was a homicide detective they made made x amount of money and mom stayed home my wife got a PhD and got a research professorship I got a PhD and did all that and what that gave us

because we didn't practice the tools we didn't use the tools all it did was gave us a shiny object in front of the bank's eyes to dig a massive hole that my dad could have never dug himself because the banks wouldn't let him right yeah so sometimes this fancy ivy league degree and your fancy mba and your fancy job doing um i don't want to say charlatans work, but doing consultant work without some skin in the game, it just simply allows you to dig yourself a $1.4 million hole. And if the math is math, it's math. They're going to be there. That's right.

That's right. Yep. Now here's the other side of it. I do want to hold this. Dave taught me this about ratios. If you're making $300,000 to $400,000 a year, you can't pay this off. You have to make some drastic changes.

Sell the cars. Pay off the HELOC. Sell your home. Begin working this debt snowball down. Well, I've got kids. I don't care. You have a two-bedroom apartment now. But I make this.

I don't care, right? This is not the picture you had in your head with your ivy league degree and your fancy mba you got to deal with math yeah and this whole thing too when you're looking at it i'm like this is what the world says is going to create peace and happiness for you it's just get stuff get stuff get the stuff get stuff i don't know if you use the heloc to do renovations on a brand new i don't know what what all this was used for but like this is the world that's like that's like that's normal yes this is the normal plan that's supposed to get you some life of happiness and fulfillment and fun and peace and joy all this stuff and you realize it just because of the avenue of debt it just digs you down where you get the opposite effect.

You're making an incredible income. And all this stuff was supposed to be this like, oh, exciting thing in life. And it ends up absolutely crushing your soul. So it's a hard lesson to learn, Daniel. But I think that you guys have a couple of years of really, really hard sacrifice from both you and your wife. And it's worth it. you're going to choose your hard it's either going to be hard for a few years of sacrifice and maybe her going to a job she hates

but it pays good i mean whatever you guys have to do that i would rather have that hard and then have freedom on the other side than to live in this day in and day out and nothing changing so i want to i want to look forward to being 46 years old. I would love for you to put down on paper. I'm 46 year old married man with three kids. I want you to rewrite this. I'm a 46 year old married man with three kids. I have an Ivy league degree in MBA from Georgetown. And then you get to write what happens next. Yeah. You can still be buried in mortgage and non-mortgage debt and still floating all this garbage or you can have made some drastic lifestyle changes stopped spending sold the cars all of them

got out of the lease for your rent your summer home or whatever sold the furniture sold the stuff pay off the heloc sell the house and sprint over the next five years towards peace yeah and live like you're making 75 a year if that you know like yes i mean just we're going scorched scorched earth nothing it's nothing and you can climb out of these numbers that's the great thing with an income like this i mean you could have 350 000 a year freed up to or more to to go and throw at this debt right like i'm like there's there's a big shovel which is and by the way positive thing income can range from 225 to 415 i call bullcrap on that it's going to be 415 and your job is not

to go oh man well i missed the account it's to get on the phone for the next 72 hours and find another one, right? There is no, well, some years is good and some that you're not a farmer and you're not praying to God for rain. You are able to go out and make this stuff work. Go figure that out. Yep, absolutely.

So John, one of the groups of people that I personally really respect and love in our country are veterans. And so in honor of Veterans Day, we're going to be giving away Financial Peace University, which is our nine-lesson course when it comes to money, to 10,000 veterans totally for free. Now through Monday, November 13th. So FPU is one of these things that we have helped, I mean, millions of people, over 10 million people, walk through and understand the basics when it comes to handling money. So whether it's

Daniel's question we just went over or even callers that we've had in this show today, there's these basic principles that are really key. It's a small part of the puzzle, but actually changing the behavior and knowing what to do with your money and then doing it, that's where you start to see progress. And that's what FPU is so great at. It puts you in a community. You start to practice these new habits around money, this new way of thinking, and we really walk with you through it.

So if you are a veteran and you want to take FPU for free, go to ramseysolutions.com slash veterans and fill out the simple form that we have there and help us get the word out by sharing the link to all the veterans that you know. So again, ramseysolutions.com slash veterans. Over 10,000 veterans were giving FPU away for free. So make sure to check that out.

But yeah. I love that. I love that, love that, love that, love that. Yeah, it's a hard topic, you guys. Money, and even coming off Daniel's question in this, like, it's a lot. And you can have all the smarts in the world and struggle with making a budget. It just is, man.

But the basic stuff. And so have the humility to say, hey, what I'm doing isn't working, so I'm going to change it. And hopefully for all of you listening, if you haven't done it yet, sign up because it will help you create new habits. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Rachel Cruz hosting this hour with Dr. John Delovie, and we are taking your calls. It's a free call anywhere in the country at 888-825-5225. Up next, we have Dylan in Indianapolis. Hey, Dylan, welcome to the show. Hey, Dylan, welcome to the show. Hey, guys. Thanks for having me.

Absolutely. How can we help? Well, I'm 20 years old, college dropout, and I put myself in kind of, I would say, a decent amount of debt at 20, which I'm not very proud of. I owe about 70K in loans. And I stress every day about it when I wake up. So I'm just trying to see you guys' view on how I should start attacking my loan and how I can pay off my debt. Okay. What's the debt in? Well, I have $32,000 in one semester of student loans. And then I have $36,000.

Wait, wait, one semester? Where'd you go to school on mars i went to a private christian school in minneapolis but one semester was 32 000 yes sir so their total annual is 6464,000? Per year. Yes. Okay, that's okay, Dylan. That's okay. We're going to keep moving.

We're going to keep on moving. What else? What else you got? It's already happened. I'm not very proud of this one, but I have the old $36,000 on a car loan. Okay, we can get rid of that. That's okay. What else?

And then I have a personal loan for like $3,700. Okay. What was that for? Well, basically when I dropped out of college, I got a job in car sales, and I needed a place to live in Minneapolis that was like in a safe area, and that's how much the market rent was, $1,570, and then I had some income problems with that job,

so I moved to Indianapolis with my roommate, and I had to buy all my lease. Okay. So what are you doing now for work? I still do car sales. Okay, and how much are you making? Not a lot. I'm making less than what I own monthly.

Yeah, because interest rates are tough right now, right? Well, I was blessed to have a good interest rate on my loans. No, no, no. I'm saying people aren't buying cars right now. Well, it's kind of hit or miss, to be honest. Okay, so how much will you make this year? How much will you make this year? My base salary is $24,000,

and I'd make maybe $1,000 a month in commission. Okay, you quit that job tomorrow. You're not making enough money. Yeah, you're making 36. I literally took my son to breakfast the other day and I drove past a sign. It was my daughter. Drove past a sign and it said McDonald's

starting $20 an hour. Your car salesman days are over. You're not good at that. You've done it two different places and you don't make enough money to eat. You got to let that dream go. All right. And you got to work at McDonald's all day

and then deliver pizzas at night and drive Uber into the morning. Like you're broke, broke, broke, broke. Is that fair? How much would the car sell for, Dylan? Well, I had some negative equity in my last car. So I kind of carried over to a new loan when I bought this car.

How much? So the car is probably worth about like $27 in the market right now. My old $35 something. Okay. So, yeah, I mean, I would take out a loan of like $15, pay off the $36, get a cheap car. There's no way they give them $15, though. You do what? I don't think anybody's going to give them a loan of like 15, pay off the 36, get a cheap car. There's no way they give them 15 though. You, do what?

I don't think anybody's going to give them a loan for 15. Oh, get the personal loan out. Could you go, could you go to a credit, credit union and get a loan for 15,000 bucks? I mean, I'd barely get one by my,

I couldn't even get one for like the 3000 without my dad co-signing. Yeah. Without the co-signing. I think there's no way. Well, I'm just trying to figure out how to get, because your car loan is what you make a year. Yeah, so we got to figure out a plan

to get that out of your life. Where's your family? My family lives in Michigan. Okay. Is that a safe place for you to go live for a while? I would say so, yes. Yeah. Because here's the deal. You're going to need some support around you, Dylan. And you're 20, okay? So I want to give you some grace. You're a kid. I mean, yeah, yeah. The mad at you here is that the systems that surround an 18 and 19 year old allowed you, a kid just trying to do what everyone's telling you to do.

You got to go get a nice car. You got to get a good sales job. You got to go to this college that costs $34,000 or whatever it was a semester. You got to go do this stuff and you can't afford it. And they let you do that. And I'm just sick't afford it. And they let you do that. And I'm just sick to my stomach, but they let you do that, man. So Dylan, the best thing that you can do right now is your income. That side of the equation, because you probably don't have many expenses. I'm assuming not. You're renting and you're going to be living on nothing. You're not

going to have a life. And I would probably move close to where you have a support system with some family. If nothing's keeping you in Indianapolis, I would consider that. But I would be working 80 hours a week. I'd be getting up and I'd be somewhere at 6 a.m. and I would be getting home at 9 p.m. I mean, you're going to be exhausted. But Dylan, you're 20 years old.

You can do it. You don't have kids at home. You don't have a wife. i mean like this is the season this is the season to do it to absolutely go nuts because it's the only part of the equation that's actually going to give you some level of grounding and hopefully after a year of that approving some level of income then maybe you can get out of this car loan i want this car loan out quickly uh because it's not it's not worth it and so whatever you have to do to be able to say, hey, what can I do to qualify to sell this and get it out? Because I think that's the only piece of this that's going to be able to relieve some level of pressure

that you can get out. So I would be taking on two to three jobs. And again, you're not going to have a life, Dylan, but I think that for a season, you're going to be able to knock some of this out. And the other great thing, Dylan, that just encourage you that you're learning this at 20 years old. People call this show and they're 45 that have a situation like this. Three kids and no retirement. So this is your moment, Dylan, of saying like, what I did isn't working. It's not working. And so I will never again find myself in this position. If I don't have the money, I don't care if it's for school.

I don't care if it's for a car. If I don't have the money, I'm not buying it. Like this needs to be a point in your story, Dylan, that you look back and you say at 20 years old, I did some dumb stuff. Took me a little bit to get out of it, some hard work, but I got out of it. And that was it. That's the last time you know this because dylan if you get this all straightened up you're especially at your age like this is where you're like you could build some serious wealth in the future but not

with these habits and not with this mindset that you used to have does that make sense if you were my friend if you're my friend dylan i would tell you to see about having a hard conversation with my mom and dad. I say hard, it'd probably be easy, but an embarrassing one and say, I need to move in for a year and I'm going to try to make $40,000. And if I have a year with no bills and I make $40,000 and I take home 28 of that,

um, I can start making a dent in some of these things. Yeah. I currently live in my, uh, my room and I pay about 400 a month for, uh, in some of these things. Yeah, I currently live in my room, man. I pay about $400 a month for my part of the rent. And your water and your electric and your food? Yeah, it's about $525. For all of your bills plus food?

That's not included. I pay about $60 every two weeks for food. No way. Yeah, I don that's not included. So I pay about 60 bucks every two weeks for food. No way. Yeah. I'm, I don't, I don't eat a lot. I'm penny pension. So you, let's say, so you have, you just say $700 total, which I don't fully believe, but I'll give it to you. Um, and you make a thousand bucks a month at your job. I make about 2000 base salary and about $1,000 extra on commission. Okay.

So what's your take home every month? This month will be $2,700. That's after taxes and everything? Yeah. Okay. Are you able to pay minimum payments on all of this? Are you able to put a dent into the student loan, keep up with the car payment? Yeah, I actually have never missed a payment yet but i'm getting to the point

now where like i feel like i might miss a payment and i'm afraid because my father co-signed most of these loans and i don't want to ruin his credit because i'm my poor yeah yeah that's a fair uh weight to carry for sure so yeah dylan i think life just looks really different and i and i'm sorry for that because i think there's maybe something you had in your head of what this is going to be and it's probably not for a season. By a season, like three or four years. Well, I was going to say, and map out, Dylan, the end game. Look at all of your payments.

Look at all of this. And what John's saying, even if you go scorched earth and you literally don't pay for anything and you say, hey, mom and dad, for a year, can I live with you guys? Start to map out a plan to say, okay, it's going to take me three years. And then that's able to be sustainable. If it's just this idea that I'm going to have to live like this forever and ever, you can start to be demotivated. So have a game plan. Map this out as more detailed as possible.

And then don't go back in, Dylan. Don't go back in. So Christmas is coming up, you guys. It is quick. And those of you Christmas shopping, if you think about a gift that actually can help your friends and family, make sure to check out our $12 Christmas sales. So our books, Total Money Makeover, Baby Steps Millionaires,

and Own Your Past, Change Your Future, all for just $12. And John's questions for human conversation cards are as low as $10 right now. Hey, let's do one. With the Christmas edition. We have the Thanksgiving deck here, too. Oh, yes. Here you go. What makes...

Me and Jade did this one the other day. What makes your family weird and what makes your family the best? What makes our family weird? I don your family the best? What makes our family weird? I don't know if this would be weird. We debate all the time, as you could probably imagine. I can imagine. I've seen it. At the Ramsey dinners.

I'll have to imagine it. And for the most part, this may be the weird part, we can kind of just walk away. Like Daniel and I really got into it about aliens at dinner the other night. And we said, all right, cheers. And cheers our margaritas and walked away from it. way like daniel and i really got into it about aliens at dinner the other night and we uh we said all right cheers and cheers our margaritas and walked away from it but it got heated for a hot second but we kind of can just like we were in a movie we were in a in a debate the other night uh me and daniel and a couple others and daniel was like all right guys i'm gonna head out and it was just so perfect it was awesome oh my gosh so yeah i would say that's uh that's it that's

what makes them great too i love it what about What's one Thanksgiving food item that makes you gag? Oh, I'm not a green bean fan. Really? So green bean, something of the other with like the soup. What's the filling soup people use? Oh, cream of mushroom soup. No, I like to put my face in that. I love it.

No. Whatever, you're like a health person I know You shouldn't like those soups I do And the chicken now I don't like Things they call pink salad

Which is just like goo With stuff in it I haven't seen those though I feel like those are just in the movies Oh they're not They're real Bits of ham and Cheerios And whatever else they put in them

Oh my gosh It's so gross. So go to ramseysolutions.com slash store so you buy something great and not a pink, gooey, nasty thing. That's right. And also make sure to check out George Campbell's brand new book that's coming out in January, you guys. It's pre-ordered today.

It's right over there. For only $20. 20 bucks, it's so great. And you get $10 or $100 of free bonus items that includes the ebook, exclusive access to online private event, Q&A with George, a lot of stuff, you guys. So George exposes some of the most common money myths and excuses head on. And it's funny. We love George. You're going to love him too. Breaking free of broke. Make sure to check that out. So we got a lot of stuff going on this season, you guys. A lot of tools out there

because we want to continue this conversation to help you guys when it comes to your money. All right, up next, we have Nathan in Fargo. Hey, Nathan, welcome to the show. Hey, how are you guys doing? We're doing great. How can we help? I have quite a few questions.

It's all kind of about the same thing, though. I recently started a new job and it doesn't pay too bad, but I'm kind of at a loss for what to do with my money. I even went to some people that do, like you pay someone else to do investing for you. And it's just hard to take advice from anyone because my parents, they just say, stick it in an account and leave it. My friends say do stocks, but they've been trained for that. And then the investors, I kind of feel like they've got their own, you know, their own agenda with the commission that they're going to be getting from it. So it's just kind of hard to know what to do. Yeah, that's fair. Okay. So how much are you making a year? So I'm based at 80,000, but I'm getting about 85. It's just easy to get a little bit extra

money here and there. Okay, perfect. And do you have any debt? I owe my parents $20,000 for school, but there's no interest on that. And I'm paying them back about $500 a week is what we agreed on. Okay. Do you have any money saved? Not much. This is a pretty recent job. So I've got, you know, a couple thousand in the bank account right now. And then I've got a thousand in a Roth and then a thousand in just some individual money markets. But that's all that I've got. How much are in all of those? Just a couple hundred dollars?

A thousand in each. Okay. So total, probably what? $5,000 that you could get to that doesn't include your Roth? Yeah, I'd say that's pretty fair. Okay, perfect. How old are you, Nathan?

21. Okay, awesome. Yeah, so what we walk people through, Nathan, is a process called the baby steps. And it really is the most, it's not necessarily the fastest, but it's the most effective way to get from point A to point B

when it comes to your money and to build wealth that actually is lasting and sustainable. And it's not this flash in the pan of this quick money. So what I would encourage you to do is I would keep $1,000 in one of your money market accounts. I would cash everything out but your Roth to throw at

this 20 grand. And I would pay it off as quickly as possible. Get it out of your, even if there's no interest, all of it, I would make that my number one goal. Just go ahead and get debt free. Because when you free up that $500 a week, which is incredible. I mean, that's two grand a month that you then have to save more and save up for an emergency fund of three to six months of expenses in that money market account that you have with your $1,000. Just add to that after you pay off this debt.

And then I would look to invest in retirement. So you have your Roth open, which is awesome, but I would put 15% of my income yet towards your Roth. If your job offers a 401k, do that. But these retirement type accounts, when you get to that point, it really is the best way. I know some of your friends probably do some single stocks and kind of play the market. But honestly, when you look at day trading overall, over a long period of time, you end up losing money. There's so much risk in it. And again, people are trained in this. And if that's how their mind works, but even those people that are trained in it, it usually comes out as a loss leader. And so being able to put

your money in something that is reliable, like good mutual funds, really is the best bet, Nathan. And if you start this early, it's amazing what can happen. If you go to ramseysolutions.com and look at our investing calculator there and just play with some numbers, like it's just, it's phenomenal starting at 21 at where you're at. I know you're not going to start today because I want you to get out of debt and get that emergency fund. But I mean, that's where you're heading, which is amazing. And so, yeah, I want to if you want to buy a house too in the middle of that i would do that save up a good down payment even before you invest that could be your next step but if you're not in a rush for that if there's still you know life is in limbo because of seasonal life

where you're at or age you don't know where you're going to be long term don't feel like you have to rush into that sure okay and nathan well i totally oh sorry to cut you off man you are super wise i heard something in you and i want you to never ever ever lose this okay okay you have a twenty thousand dollar interest-free loan to your parents you know that they want to float that because there's a little bit of guilt, a little bit of parent weirdness there. Yeah, yeah, 100%. You have a couple of buddies who are like, bro, dude, buy stocks. We're going to be billionaires.

Dude, if we bought Tesla, we – and you recognize, dude, I don't even like eat the same food you all eat because you're morons. And then you have a couple other buddies that don't have the heart of a teacher. They have the heart of a commission salesman when it comes to uh retirement bro you need to put it in my like super fun and i'm and so you're like hey wait a minute you just make money every time i do this you are so wise looking like following the rabbit down the hole and so what rachel just gave you was a map to unhooking yourself from all these other opinions and living a life that very very

very few americans live which is a life of freedom and peace that sounds pretty good like mom like oh honey you don't need to pay us back this much mom i'm not gonna owe anybody any money, including you. Well, it's no interest. I know, Mom. Yeah, dude. And it just changes Christmas, right? Yeah, no, 100%.

You know, if they see me showing up and I've got a nice new coat, they're thinking, well, why isn't that money that's... Totally, totally. Get it out. Yeah, yeah, yeah. And, man, if you want to buy a house buy a house bro you're missing out on the new stock well cool i'm gonna have a place to live and i'll i'll let you rent my garage yeah and the hard thing too nathan to john's point is like this plan is not the exciting like flashy

sexy plan there is it's not gonna be like oh yeah did you see this thing that happened this it's not i mean but it's the thing that is going to sustain you because it not only helps put you in a better financial situation, it helps you, Nathan, the person as you're going through this of delayed gratification, all of it. And people make really unwise financial decisions

when they're greedy. And what's the other one? When they're drunk, greedy, and looking for shortcuts. Yes. So don't do that, Nathan. Play the long game. And you're being so wise at your age to do this. So thank you so much for the call.

Thanks to all the guys in the booth to make this happen. And Emily. And Emily. Sorry, Emily. I see you, girl. John, thanks for co-hosting. And thank you, America, for listening. This is The Ramsey Show.