The Ramsey Show - App - I Owe More on Student Loans Than My Mortgage! (Hour 1)

Episode Date: February 10, 2023

George Kamel & Kristina Ellis answer your questions and discuss:   When to pay off medical debt, from the blog: How to Ease the Burden of Medical Debt Super Bowl sports betting amid record inflation,  Investing vs. paying off the house, "My boyfriend doesn't believe in the Baby Steps", What to do with money leftover in an ESA account. from the blog: ESA vs. 529: Which Is Better for You? Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, broadcasting from the Pod's moving and storage studio, it's The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm Ramsey personality, George Campbell. Join this hour, my best-selling author, Christina Ellis. And we are taking your calls at 888-825-5225. You jump in, we'll talk about your life, your money, whatever is on your mind, whatever ails you. Hopefully, we can help you take the right next step. Rachel joins us up first in Seattle, Washington. Rachel, welcome to the show.

Hi there. How are you guys today? We are doing well. How can we help you? I am trying to start this journey, doing baby steps and stuff, and I have some medical or some dental work coming up, and I'm wondering if I should pay for that before I do my $1,000 emergency fund. Well, tell us a little bit more about your situation. How much debt do know of right now, it's about, well, maybe $53,000. And what is that made up of? $6,000 in student loans and then about $4,000 in medical debt and about $2,000 to $3,000 in current consumer debt, and then the rest of it's old debts that I have to keep on to things. Okay.

Speak directly to your phone, Rachel. We're having a slightly hard time hearing you. Sorry. When I get embarrassed, I get quiet. There's no reason to be embarrassed. You're doing so great, and we're going to guide you through this. So tell us your income. I expect it to be about $33,000 this year.

Okay. And you're single? Yes. Okay. And tell us a little bit more about the medical procedures on the horizon. You said it's some dental work? Yeah. How much is that going to cost? About $10,000. And it's, so I had to have some dental, some, I've had a lot of medical over the last three years. I didn't have medical insurance

for gobs of years. And so walked in with hip issues, ended up with cancer. And that was just kind of the start of the journey over the last three years. And so, but one of the things is I hadn't done a lot with dental. And so they, I've had a number of teeth pulled, but there's some of it where they're not have more teeth pulled and they had to reconstruct some stuff on my jaw and so I have to so if I don't put in some implant an implant in one place then I'll end up with having to have some other teeth pulled I've got a couple teeth that need work and even with insurance it'll be $10,000. So $10,000 out of pocket. Rachel that sounds that sounds overwhelming.

I'm sorry. You've been going through it. Yeah. How long have you been listening to the show? Well, recently, probably the last couple months, a couple decades, no, a decade and a half or a couple decades ago, I mean, I did FPU. I got myself all out of debt except the student loans.

And then a lot of life circumstances and got off track. You've been through it. You've been through it. And I think with you here now, you've your i have i've had a moment right like this all yeah feels overwhelming okay because it's going to take some radical effort and changes to get out of this mess and to also pay for the medical but i think you're ready for it yeah how much money do you have in the bank, Rachel? $440 right now. Okay.

And how soon is this procedure happening? So the two teeth, if I don't want to lose them and have it increase more, each of those need to be done ASAP. And I just had one of them chip another piece off, so it needs to be done. And then the other thing, I've got one that phase one is scheduled for the end of May, and then phase two is I have basically a year to do it. I have to heal up for about three to six months, and then within that next year, I can do it. So we don't need to come up with $10,000 up front is what I'm hearing. We can do this in pieces and stagger it.

Yes. So how much do we need for the next one, the ones that are urgent? How much money? They're $1,200 apiece. Okay, so we need $2,400 saved within the next few months. Is there a payment plan they put you on? Have you explained your situation to them? I have, and when it comes to dental, they won't work with me unless I want to go more into debt.

Have you gotten a second opinion from a different dentist? Yes. And what'd they say? And it was the same. And they're also unwilling to work with you? Yeah. Well, Rachel, I'm wondering... There's a number of places that will say, well, we'll pull it, and that'll be cheaper,

but then it destabilizes the mouth, and then I have, you know, it's like, yeah, the short term. But yeah, anyway. So you've been through all this medical stuff. You've had all these challenges. How are you feeling physically now? Are you able to work out of the house? Are you able to work a full-time job? I have to take off one to two days a week for medical.

Okay. I am a tax preparer, so most of my income is earned right now. So other than doing the two dental things, I am trying not to do more medical than I have to right now, although I'm in physical therapy for a couple types of physical therapy. And, you know, I can go down the road, but all of that to say that it is a lot, and yes, there's a lot going on. Well, I'm looking at... To wait longer is problematic, too.

Yeah, I'm looking at your income, and it's pretty tight. And with this procedure coming up, I'm just trying to think through different ways you can raise some more money to be able to afford these procedures. Maybe there's, you know, something you can sell. If you're physically able to, maybe you can get another job, work a little bit extra. But with $33,000, I know that things have got to feel really tight, especially with the debt payments. Yeah. And one thing I should say is that my mom allows me to live with her.

There's a bunch of stuff without having to pay rent. Okay, that's good. Yeah, we need to lower your expenses as low as possible, increase your income as much as possible, bust it preparing those taxes so that you can create this money to pay for the medical. So we're going to put the baby steps on hold right now. Our job is to stack up as much cash as possible and take care of your health. Then we'll get to the rest of the debt. So take a pause, but go hard at creating this pile of cash to get you through this. I'm so sorry. It will get better, Rachel. We are here for you. Let us know if we can help in any other way. This is The Ramsey Show. Субтитры подогнал «Симон» welcome back to the ramsey show i'm george camel joined by christina ellis this hour it's a free

call at 888-825-5225 well christina as was doom scrolling on Instagram, as I tend to do, I saw this post from ESPN pop up. And here's the big headline. A record 50.4 million U.S. adults are expected to bet a combined $16 billion on this year's Super Bowl. Whoa. Just take that in for a second. $16 billion, 50 million Americans. That is a large percentage of the entire population.

Now, at first I went, okay, that's crazy. But then I went, wait, aren't these the same people complaining that inflation is too high and there's not enough money at the end of the month and they're living paycheck to paycheck? And so that was my post. My reaction was, Americans, inflation is killing us. We're living paycheck to paycheck. And so that was my post. My reaction was, Americans, inflation is killing us. We're living paycheck to paycheck out here.

Also Americans. Oh yeah, bro, I got 500 bucks on the Chiefs. Make it make sense. That's all I'm asking. This just boggles my mind that people are willing to spend their hard-earned money and just throw it away at a sports casino for fun. So here's the juxtaposition. Yahoo Finance said that half of Americans say their personal financial situations are worse now than they were a year ago, which is more than any time since the Great Depression. And Fox Business said amid high inflation and rising interest rates, credit card balances have now increased to $931 billion in the final quarter of 2022. This is insane. The number of new credit cards have opened have spiked $21.6 million in the third quarter.

I mean, the levels of debt with the levels of sports betting tell me that bad things are happening out there. Yeah, that's very concerning. It makes me wonder, is it kind of like the lipstick for men? You know how like what they say whenever there's a recession, like women buy more lipstick? Is that a thing? Do men like sports bet more? I guess that's what they do to, you know, quell all the anxiety, is they just turn to sports and then they go, well, my friends are betting. It's now normal to bet on sports. There's a thousand apps. And yeah, okay, let's see if Mahomes gets the touchdown in the third quarter.

It just doesn't make sense. That's wild. I thought it was more of a niche. I thought it was like, you know, sports betting, there's probably two or 3% of people, but 50 million people? Every year it's become legal in more and more states. I think it's like 33 states now allow sports betting.

And here's the thing. They're seeing record profits. It's like the new crypto because it feels not as dumb as crypto because it's something that you enjoy, that you know a lot about. But these bookies that are behind the scenes, they are going to win. The house always wins. This is just like Vegas, except you get to do this from the comfort of your freaking couch. And it's wild, too, because we've seen so many studies and stats on

kids and teenagers getting into this, where it's like young kids, I don't think they're really supposed to, but it's becoming a huge thing in high schools where we're worried about kids doing sports betting, which that just blows my mind. And the bankroll you need to even make any amount of money in this is insane. You would need to spend hundreds of thousands of dollars to see any meaningful return. But what happens is you throw 50 bucks, you lose it. You put another 50 bucks in, you might win it back. And so there's an addiction happening, especially with these young people. It's like the gateway drug to gambling addiction. And here's what's crazy. The number of expected Super Bowl bettors is up 61% from last year's survey. And our state of personal finance study found that in the last

three months, 14% of people said they had placed a legal sports bet. It begs the question, how many placed illegal sports bets? We just don't know. No one's going to admit that. But 36% said they lost money in 2022 sports betting. And that's equivalent to 5% of the population having lost money on this. George, what would you say? That just hurts my head a little bit, thinking through all the people who are struggling with their finances and all the people who feel like they're drowning in credit card debt, but they're still betting. What would you say to snap people out of that? Well, number one, if you are really struggling, like truly struggling. Now, I'm hoping and praying that the people that are sports betting are out of debt with a fully funded emergency fund and they're investing 15%. And this is just

fun money. They're okay blowing. If that's you, I am happy for you. The record indicates that is not the case. And so if this is you and you're going, this is my last ditch effort. Let me at least have some fun. I'm broke. Might as well at least have some fun. You're only going to get broker. And so we need to stop the bleeding and go anywhere there's money leaks, we need to stop. There are better ways to be entertained and blow 50 bucks than on the big game and on the squares. And it's just gotten out of control. And so just say no, go to the party, bring a dip. It costs you five bucks and enjoy the Super Bowl that way. But do not play in this sports casino. You will lose. The house always wins. And there's a reason why Vegas is doing so well and America is so broke. It's a good word, George.

Oh my goodness. And we've covered sports betting on multiple areas, multiple shows. Rachel Cruz show, we did a thing on sports betting. If you want to see me in a Brady jersey, you can check that out. Hopefully he's retired for the last time. We just don't know. We don't know. To be determined. Well, enjoy the big game, do it on a budget, and don't be stupid.

Hope that hits. Yeah, that's a word. Let's get to the phones. Charles is in my hometown there in Massachusetts. Charles, welcome to the show. How are you doing? Hi, it's an honor to speak to you too. You as well. How can we help? Okay. Basically, I've screwed up my life. I know that. And I don't see any way out of it. I don't know how to even start or what way to go. But my student loans are $150,000 and they're not coming down. And my house mortgage is $120,000. And so since my house is less than my student loans,

when you do a debt snowball, do I pay off the house first and then the loans? But either way, it's going to be years before I can even come close to paying off anything. And then how do you do something like that? I got kids at home. How do you do something like that and not find yourself singing Cats in the Cradle in a few years? Well, Charles, who told you that your life is over? Well, it's like I can try. I don't see any way of paying this off, you know.

What's your income? Let's put some facts on paper. Okay, I take home. My household income is maybe $45,000 to $50,000, depending on if I can get overtime. And that's the most I've ever made in my life. Okay. What do you do for a living?

Right now, I'm a mechanic at an amusement park out here. I was lucky that they gave me that job. What's your degree in? You said you have $150 in student loans. Yeah, I have a degree in elementary education and a master's in school administration. Okay, and how old are you? I'm 48. My wife's 53 and she's not able to work or drive or anything. Does she have a disability income? Yeah, she has a disability, but she gets about a hundred dollars a month in social security. That's all she was able to get. But my other daughter who lives with us is disabled and she gets about $800 a month. So that's what's saving us basically. Well, Charles, you've called the right place. We like calls like

this because we have seen thousands of people in situations like yours with six figures in debt get completely debt free. So first of all, your life is not over. You have not screwed up so bad that you can't come back from this. You absolutely can. We actually have a personality that joined recently who paid over $400,000 in debt off. And we've seen that multiple times. So I just want to encourage you that you are in the right spot. And if you're willing to fight for it, you said that it's 150 and it's not going to come down. I believe it's going to come down pretty quick. You're educated. I think your income potential is pretty high. Right now you're 45 and 50, and I think we can really bump that up. But, yeah, I think first just getting out of the mindset that this is too desperate of a situation to get out of. How does that feel to you?

Do you feel like you can do this? I think I can. It's just that when I look at the numbers, it would be like, if I even paid, if I paid like $1,300 in my student loans, even that would take 30 years. If I pay $1,200, which is what my mortgage is, that's 30 years. And so I can pay $1,500 on my mortgage and be done in 15 years. So I was planning on doing that. But then it's like you have to work, you know, gazelle speed and all that. But if you do that, it's like you become a workaholic and then your kids are like, you know, where were we? You paid off all your money.

Gazelle intensity is meant for a few years. It's not meant for decades at a time. And so, number one, we're going to send you Financial Peace University as well as EveryDollar. That's our proven plan, nine lessons, the budget, the full kit and caboodle. Go through that. But I would not pay off the mortgage before the student loans. You can't bankrupt on the student loans. You can get rid of a mortgage by selling your house one day. You can't get rid of Sally Mae.

And so I'm attacking that first. Save the house for baby step six. And let's send them from paycheck to purpose because I think you need a a bigger shovel let's get that income up so you can pay this off quicker This is The Ramsey Show. I'm George Campbell, joined by Christina Ellis this hour. Open phones at 888-825-5225. Let's go to the phones. Tom joins us in Sacramento. Tom, welcome to the show. Thank you, George and Christina. I've just got a question.

We're in our late 60s. We were behind in our retirement savings. We only have about $100,000 in deferred comp and retirement accounts. And wondering if it makes sense to take advantage of the catch-up provisions in my deferred comp to exceed the 15% for the next three years before retirement at the expense of maybe not paying off the house quite before we get to retirement. So if you, let's say you invested 15% and then did everything else onto the mortgage, would you pay that off by retirement?

It'd be pretty close. Okay. So it's kind of a, either way, you're looking at the same numbers. How much do you have left on the house? About 100. You're looking at the same numbers. How much do you have left on the house? About $100,000. And you said you have $100,000 total across all retirement accounts? Currently, yes. What's your income right now? About $180,000.

Awesome. Are you both working? Yes. Okay. And how long do you see yourselves working for for you said you're in your late 60s do you see this going as long as it takes two or three more years okay and i and i should say that the you know the we're committed to selling the house when we retire so and downsizing yeah what's the house worth a house for us in retirement yeah how What's the house worth? A house worth in retirement. Yeah. How much is the house

worth? Oh, probably close to half a million dollars. I'm in California. Okay. And then outside of your 15%, how much do you have extra to either throw at the mortgage or at retirement? Probably another 10%. Okay. Would you be able to hit all of the contribution limits for the catch-up if you did that? Yes. My contribution limit for deferred comp is $45,000, and I could hit that. So when you move from the half a million dollar house, where do you plan on going after that as you downsize? Are you going to stay in the same town?

What's that move going to look like? No, we plan to move near our children and they're in a lower cost state. So there'd be a sizable amount of equity left over. So the goal would be to pay cash for something really reasonable when you guys sell? Oh, definitely. Okay. Because even investing this money and doing the catch-up contributions, it's not going to create a million dollars in the next few years. And so either way, it's not going to move the needle significantly. But if I'm in your shoes, I probably would focus on those catch-up contributions for now since you're going to sell the house as soon as you guys retire.

And so you're not going to have a fixed expense of the mortgage either way long-term in retirement. All right. Okay. Well, that's how we had been viewing it. But we've been listening, and it seems like the catch-up isn't quite as important for some, but we wanted to get some input on it. I appreciate that. Yeah. And let me ask you this. Are you guys working with a financial advisor right now? Yes. Okay. And what is their take on your situation? There's no wrong decision in this regard, that it's two good choices, but leaning towards maximizing the deferred comp because the tax benefit,

it saves us about $6,000 a year in state and federal taxes. Well, it sounds like it would give you guys a little hope for some dignity in retirement as well. Well, between our pensions and other things, we're going to be fine in cash flow there, but we just want to make the best decision possible. Absolutely. Well, thanks for the call, Tom. Appreciate it. That's a tough situation when you wake up and go, we didn't do a good enough job saving, and we have to really cram all of this in within a few years. The good news is you have a fantastic income, making 180. If you can live off a very small portion of that and throw the rest at the mortgage and into retirement for the next few years, that'll put you in much better shape. Thanks for the call.

Yeah, there's a beauty in kind of having that slightly shorter timeline of like, if you can see that end goal of we're moving in two to three years, it's like, let's just go all in and be super intense in this season, work as hard as we can to catch up. And then in three years, we're going to have this beautiful retirement situation. But I'm proud of y'all for really leaning in right now and going, okay, we're going to go. We're going to go intense. Yes. I'm proud of you for not burying your head in the sand and going, well, we'll just figure it out when we get there. We're just going to keep on living how we've been living. Love it.

All right. Let's go to Courtney in Canton, Ohio. Courtney, welcome to the show. Thank you, Derek. How are you guys doing? Doing so good. How can we help? So I've been wanting to start the Baby Steps for quite some time now.

And honestly, the only thing that's been keeping me from doing that is my partner. Um, it hasn't been the same partner the whole time. Uh, but now, uh, the boyfriend that I have, we live together and I've been trying to get him on board with the baby steps. We're, I think we have just a few episodes left of FPU to watch. Um, but he doesn't really seem to be very motivated to do anything about it. How is he doing financially?

I mean, he has a steady income. I think he has $1,000 savings. I haven't actually seen it, so I don't know. Does this boyfriend seem like long-term potential? What's know. Does this boyfriend seem like long-term potential? What's that? Does this boyfriend seem like long-term potential? I think so, yeah. Okay, you said it was a different partner when you started. What happened with that situation?

Was it the money that ended that relationship, or how did that transition happen? No, that ended due to him getting getting kind of controlling and i said i wasn't gonna do it so i left how old are you two uh i'm 26 he is 32 okay and you're saying you you're over halfway through fpu and he hasn't really changed his tune he's just kind of like going through the motions to appease you at this point? Pretty much. What do these conversations look like when you kind of challenge him and you're like, hey, I really want to go all in?

What's his response? He says, yeah, let's do it. And then when we go to have like a budget meeting or like a dream meeting or anything of the sort, he doesn't, anything that I ask him further than that is, I don't know. Now, you guys haven't combined any finances, correct? Correct. Okay. I would continue on the baby steps on your own, and I think the long-term play is having the hard conversations going. I'm not breaking up with you because of FPU, but if we don't align on really foundational money values, I don't see

this going anywhere. Because it doesn't sound like he has a lot of vision for his life, truthfully. Yeah. And that to me scares me more than any kind of financial situation. Because you sound like you've got goals in life. You have a vision for your life. You want to be somewhere five years from now, 10 years from now that you're not right now. And he's fine just coasting along. Yes. That's what worries me. So I'm not telling you to make any decisions here, but I think you need to light a little fire and go,

this is more serious than you think. I'm not just doing this to go, hey, will you go through FPU with me? I want to know, are you on board for having a vision for your life and for our life together? Because if he doesn't have a vision for his life, he ain't got one for you all's. You understand? Yeah. Well, and that's the beautiful part about dating is you're not tied to him long term. We talked to a lot of spouses who were having these conversations where the wife is like, I can't get my husband on board and she's frustrated.

And that's a different conversation than when you're just dating. I mean, that's part of dating is figuring out, you know, what what what's their motivation level? What's the future going to look like with this person? Because if this is already happening now in your dating relationship, then it's probably not going to get better in marriage. It's not going to get better when you combine the finances. And now he's got a whole another opinion about what to do with our money. Yeah. But I do love the idea of you going ahead

and setting the example because you are dating and it is your money and you shouldn't combine finances yet. So go ahead and lead the charge and hopefully it'll motivate him. But if not, I mean, that's a pretty significant sign.

Yeah, you be your own gazelle and you be the thoroughbred. And if the donkey can't keep up, that's on him. You know what I mean? And so you got to live your life. Don't wait on no man to get ahead financially be the thoroughbred. And if the donkey can't keep up, that's on him. You know what I mean? And so you got to live your life. Don't wait on no man to get ahead financially and achieve your goals. And on the way, you might meet someone else that does have those values. And I'm not saying he's not the one. Maybe he changes his tune. I hope he's listening to this going,

dang, Courtney's a special girl. I got to get my game together because I'm about to ruin this thing. So best of luck to you, Courtney. Thanks for going through Financial Peace University. This is The Ramsey Show. Appreciate you all listening. If you're a new listener with us and you want a deeper dive into the Ramsey baby steps and all the stuff we talk about on the show, you just want some direction because you're new around here, you can go to RamseySolutions.com and click on the Get Started button. We're going to help you figure out the best next step for your financial journey based on exactly where you are today. You just answer a few simple questions and we'll help you.

That's RamseySolutions.com. Click on Get Started. Well, with debt payments and now inflation stealing more and more of your paycheck, we know a lot of you feel like you're drowning and you're scared to death that you won't have enough to take care of your family. But you shouldn't have to live with that kind of stress. And if you want things to change, you have to have your I've had it moment and decide to try some new things with your money. And that means it's time to try Financial Peace University. This is our nine lesson course that will teach you how to beat debt and build wealth. It's everything you wish you learned about how to handle money that they didn't teach you at school. Nearly 10 million people have now taken FPU and they'll tell you

they don't worry about money like they used to. They are in control and you can be too. So decide that you are done stressing about money and take control. Start Financial Peace University today at ramsaysolutions.com slash FPU. That's ramsaysolutions.com slash FPU. Andrew joins us up next in Rockford, Illinois. Andrew, welcome to the show. Are you with us, Andrew? Hey, there you are i'm here what's going on well me and my wife we're about 40 and 41 years old and we're driving by a local community college today and we have uh our kids esas are going to be about 40 and 40 40 and 50 000 dollars $40,000 and $50,000 for each of them when they graduate high school. And we're paying $1,400 to $1,500 a month for our house,

so it'll be paid off at almost exactly that same time when they graduate. Awesome. Nice. And we have also $200,000 in our retirement accounts right now. And we're wondering what we should do with those ESAs if they go to the community colleges and live at home to go to a nearby in-state university. Okay. Do you know what it's going to cost for the community colleges?

The community college, we are looking it up as we're driving by. For anything, if they live at home, which will cost way more than the tuition, right now, it would cost, for each of them, it would be less than $10,000 a year. Okay. That's great. So you're on track to have it paid for based on the current rates. When are they going to community college? When would that be? be my daughter who's 11 that would be around 2030 okay so we've got plenty of time here which means we don't know what it's going to cost well and there's also the possibility that they're going to go to community college then want to transfer to a four-year school yeah that's what they're thinking they probably will want to do. We'll go two and

two. Yeah, and in that case, then $40,000 and $50,000 could be used up pretty quickly with the current rates for four-year institutions. Plus, even beyond that, they may want to get additional education, get a master's degree, get a certification. And they'll have other expenses like books and laptops. There's tons of qualified expenses you can use that money for as well. Not to mention further education, like a master's degree, further schooling, different courses, depending on what they actually end up doing with their career. Okay. Yeah, so I mean... Then we would have enough, do you think the additional like $1,400 to $1,500 a month would be enough to like pay for that additional stuff?

To cash flow college? Is that what you're asking? To cash flow after using up the ESA. Because you'd have no mortgage, you're saying? We would after, like, we would, by the time my daughter gets into college, we would have no more mortgage left over. And so if there was any extra money you needed, you could cash flow that because you don't have a mortgage payment. And that's a great goal to have. Say, hey, we want the mortgage paid off by the time these kids go to college so that we can continue to help. And by the way, they can still work part-time. They can still get scholarships and you can withdraw funds from the

ESA against those scholarships with no penalty. Well, and if anything, I would encourage them to just be strategic with their finances regardless, because, you know, if they don't end up needing to use the money from the ESA because they won scholarships instead, that's even better yet. So I wouldn't stress out about it. I think the 40 and 50 could easily be used if they get a four-year degree, but also if they continue on further, they're, on further, you'll have the money that you could potentially cash flow, plus there are other ways to pay for college. This is a great problem to have, Andrew. That's all we're saying. You guys have done such a great job. How old are you two? I'm 41 and she's 40. Awesome. And what's the household income?

It's about a hundred thousand a year. Fantastic. And what's the household income? It's about $100,000 a year. Fantastic. And so over the next seven years, my guess is your income goes up and you're going to pay off the house. And so this is not something I would lose sleep over. You guys are so far ahead of the game to already have $40,000, $50,000 in there by the time they're 11 years old. And you think our $200,000 a year or 200,000

in our retirement accounts will be enough to... If you continue investing at 15%, you do the investing calculator online and go, all right, 200 grand. If I continue investing 15%, 20 years from now, when we're 60, we're going to have a few million bucks in the bank with a decent rate of return. And you did say you're currently investing 15%, correct? Not quite that much. I think it's lower, probably towards eight or nine. I would bump that up today. And if that means we put less in college, that's totally fine. The A1 is baby step forward. It's in that spot for a reason. It comes before saving for college. We've got to get the mask on first, just like we do on the plane.

I don't want your kids to have to take care of you because you were investing 8% and they were going, well, thanks for sending me to college debt-free, Dad, and now you have to live with us. Right. So that's the goal. All right. Thanks for the call. You guys are doing a great job, though. I love hearing a parent that's the goal all right thanks for the call you guys are doing a great job though i love

hearing a parent that's 41 42 their kids are young and they're saving aggressively and having these questions that is that is awesome for all the parents that are listening who you know their kids are going to go to college and they're feeling like this is 15 years away i don't even need to think about it let this be your wake-up call. Be like Andrew and start thinking about it now. If you're out of debt, if you're investing for retirement, start thinking about it now because that's part of the reason why we have the student loan crisis is there was not a lot of conversations like that early on. A lot of kids are going to college with no insight into their financial situation, how money works, that mom and dad aren't going to

pay for it, that mom and dad don't have the money. These conversations need to happen early. And parents, if you can start saving early, that's just going to really help these conversations. Well, and so many parents have their own baggage and shame financially. And so they feel weird talking to their kids about how they're broke and how they can't pay for college. But the biggest blessing you can be is to tell your kids, we don't have money for college and I want to help figure out a way for you to still go debt free. Yeah, that's my story. My mom could not afford to pay for my college education, but she sat me down my freshman year of high school and was super honest with me and was just like, Christina, you're going to be on your own

financially once you graduate from high school. So start thinking about how you're going to pay for college now. And she told me about this concept called scholarships. And I thought that sounded so exciting. I was like, wait, what? If I start working now, then I could have all of this thousands of dollars and free money to go to college. That sounds incredible. And so I just got obsessed with the idea of scholarships. I read every book I could find. I started interviewing alumni from my high school who'd won scholarships. And I just went all in. I built up my resume. I did a ton of volunteer work. And then my senior year of high school, I treated the scholarship application process like a part-time job. I just applied like crazy. And thank God it paid off. I was able to win over a half a million dollars in scholarships

and go to school at Vanderbilt University, which is, I learned last night, I looked at their website, it is $84,000 a year right now. I know, crazy. But I was able to go to Vanderbilt, completely debt-free, and then get a master's, totally debt-free. All thanks to my mom being willing to have the courage to have a hard conversation. And what she couldn't give me in money, she gave me in motivation in that hard conversation to be able to go, I'm going to give you insight into what your future is going to look like. And if you're willing to work hard now and push through, you can go to school debt free. I remember when I hosted our personal finance curriculum for high school and I was interviewing these kids going, hey, so what are you studying? Why are you studying that? What do you want to do with that? What kind of job are you going to get?

What kind of money do you think that job is going to make? It was like at a police interrogation. Some kids ran out crying, Christina, and I realized, I'm the first one to ask them these questions. The parents aren't doing it. I shouldn't be America's dad, okay? Step up, parents. Have the hard conversations now instead of causing heartbreak and debt down the line. Go check out Borrowed Future if you want to sit down with your kid

and have these conversations and have it be a natural, fun encounter. There you go. Yep. That puts this hour of The Ramsey Show in the books. My thanks to Christina Ellis, my co-host, all the folks in the booth, and you, America. Thanks for tuning in. We'll be back real soon. Hey, George Camel here. If you love the show and you want a deeper dive on your money journey, we've got a weekly newsletter that gives you helpful articles and tips on following the Ramsey way. Just go to RamseySolutions.com today to sign up for the newsletter. Again, that's RamseySolutions.com to sign up for our weekly newsletter.