The Ramsey Show - App - I Want My Money To Last for Future Generations (Hour 3)

Episode Date: April 19, 2021

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host, Ken Coleman. Ramsey Personality, host of The Ken Coleman Show, is my co-host today. He talks about careers and jobs, which means we're going to talk to you about your life, your money, and your career today. Open phones at 888-825-5225.

That's 888-825-5225. Gina is with us in San Francisco to start off this hour Hi Gina, how are you? Hi, how are you Dave? I found you on YouTube and found your show very, very informative Thank you So, my husband died three weeks ago Oh my gosh

Yeah, cancer Oh, how old was he 38 only oh how old are you i'm 35 how long were y'all married about eight years oh baby i'm so sorry three weeks ago so you guys have been through a long struggle, haven't you? It was a beautiful marriage and not so much struggle. No, I mean, how long was he with the cancer diagnosis? Oh, two years. It was a rough fight.

Yeah, that's what I mean. So my question is, what should I do with three things that he left us? He has life savings, an insurance payout, and a 401k to protect it from inflation. That's my goal. What is your advice? Okay, so how much life insurance? Life insurance will probably get around $20,000 to $50,000. Okay. How much was in the 401K?

401K, around 20K also. And did you say life savings? Is that what you said? His savings, because we didn't really have a joint. Right. So how much was in the savings? How much? $200,000. What is that in? Just a savings account yes i already um closed it and put it on a custodian account which is my son's you put it into your son's name my son and my name so it's a custodian account under both of our names okay a custodian account is open for a minor.

The custodian is not the owner. The custodian is the manager. And the only way you have a custodian account, it is not in both of your names, because you can't do a custodian account for an adult. Right, right. Yes, I'm the manager. So you put it all into your son's name. And you're the custodian.

Yes. When did you do that um and the last three weeks right yeah yeah okay all right um okay um all right the Okay. All right. The first thing is that we want to make as few big decisions while this pain is so fresh. Okay? Mm-hmm. Because if my wife passed away three weeks ago, I make money decisions for a living. I teach people to make money decisions for a living. I'm not making any big decisions in the first three weeks. I'm just going to cry. I'm just going to cry.

Okay, you're in the fog of grief. No human being's brain works well. Okay? But you're going to have to go ahead and make some decisions because you made a bad one. This move to this custodian account needs to be undone very, very quickly because you've made a mess. And I'm not picking on you. Don't misunderstand.

But you cannot move money of that size from one individual to another individual, like your child, for instance, without gift tax. And so you've gotten yourself into a problem here. And I don't know who told you to do this, but they were not giving you good advice. And money doesn't need to be in the child's name anyway. It needs to be in your name because it's your money. And you need to be managing it. And, yes, we're going to take care of the child.

That's what mommies do and daddies do. But the money does not, the bulk of your net worth does not need to be in your child's name. That's a mistake, okay? And so what I am going to direct you to do is go to DaveRamsey.com and click on SmartVestor, and you'll find some people in your area that we recommend that have the heart of a teacher, and they're going to teach you what to do next gently, calmly, and you're going to understand it before you do it. I mean, this week, kiddo, undo this, because I don't want the IRS getting wind of this.

I don't want you to get hammered with a gift tax here. Okay? Okay, so we draw and put it on my account. In your name, into some investments. Or you can park it just in a money market while you cry a little and then learn about investments later. But you don't have to be sophisticated three weeks after your husband passed away, honey. Give yourself a little room, okay?

All we have to do is keep the lights on and keep groceries in the refrigerator. That's all we've got to do right now. What about the insurance and the 401K? Same thing. Same thing. I want to spend and make no big decisions, if at all possible, for about six months. I'd like to just sit it in a, I'm not worried about inflation for six months. I'm worried about grief.

Okay. And this is what I personally would do. If my daughter called me, who's your age age and said that something happened i would say listen what we're going to do is do the the least number of decisions we can do for six months and we're just going to cry and then when and every day that goes by your brain will get a little bit clearer and a little bit clearer and a little bit clearer and it'll always hurt but 25 years from now it won't hurt as much as 25 days from now. Does that make sense? Yes.

And I'm not saying you're an incompetent person. I'm saying you're in a situation where you don't need to make big decisions. You can if you want. My advice is to not do that, though. So I would sit down with a smart investor pro. I would move it all into a money market account. You can roll the 401k into an inherited IRA without any trouble at all. You're the beneficiary on it. You can move it.

It'll have no taxes on it. They can show you how to do that, and you don't have to make a bunch of big investment decisions. Now, later on, I'm going to go into mutual funds after everything clears in my brain. I personally invest, Gina, into four types of mutual funds, growth, growth and income, aggressive growth, and international. And I spread it evenly across those. If you do that, you will outpace inflation considerably. Inflation has run 4.2% for the last 75 years, according to Consumer Price Index, a CPI. And that's our measure of inflation. We're probably getting ready to see some new inflation, so it's wise to think about outpacing it with these building shortages that we've got,

supply shortages and things. Now we're going to see a little of that come back for the first time in a couple of decades, really. But you're still going to be okay. You've got to make more than about 6% on your money to beat taxes and inflation, to break even. Taxes are going to take up about 2%. Inflation is going to take up about 4%. That's 6%. So if you don't make over 6%, you're not breaking even with taxes and inflation.

But that's your long-term play, kiddo. It's not the next six weeks. It's not even the next six months. I'll tell you what. Hang on. Kelly will pick up, and she'll get you with one of our coaches for free. We won't charge you anything and then get you with a SmartVestor Pro and walk with you through this. I'm so sorry. In an uncertain world, being a good steward of your money is more important than ever. While some circumstances can't be controlled, there are items within your

budget you can take charge of, such as your health care costs. For nearly 40 years, Christian Health Care Ministries, or CHM, has provided a budget-friendly means of sharing for medical bills when our members need it. Learn more by visiting chministries.org slash budget. That's chministries.org. While our famous $10 sale is back, get the tools and resources you need to make real progress with your money and your life goals, all for just $10 a book. That means saving up to 60% on over 40 best-selling books, like the number one bestseller, The Total Money Makeover, or Ken's book, the number one bestseller, The Proximity Principle, about getting the job you love. These also make great gifts. Head to RamseySolutions.com slash store.

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You've got to be 18 or older, of course. Text CASH to 33789 and check out the $10 sale at RamseySolutions.com slash store. Michael is with us in Detroit. hey michael how are you i'm welcome to you how are you doing today sir better than i deserve how can we help so i'm um i'm very thankful and fortunate for on that um i've saved and scrimped a lot in my life and I have a pretty good savings. And I grew up in a very, very poor household and it was homeless for a while and I'm debt-free and I'm sort of concerned that I'm not maximizing what I could be doing. My goal really is to leave

behind some generational wealth for my children. But I'm pretty nervous when it comes to real estate, especially I've been listening to a lot of folks for their homes. You know, people aren't being forced to pay their rents. And then the people that own these properties are, you know, losing them. So I'm just looking for some guidance on what someone in my position could do. I'm sorry. What to do with what? You want to build generational wealth and people are losing their houses because they don't have to pay rent.

I don't understand. So look for better investments. So right now I'm maxing out my 401k to the legal limit and I've got some investments in some mutual funds, but I'm not really especially astute, I guess, in investing.

And so I know that you speak a lot about real estate, but I was wondering if you just had any guidance on how to maximize returns if you're a little skittish on real estate. Okay. If you're asking what to invest in, number one, all investments have a level of risk, period. And that means there's unknowns. That means things are going to happen that you can't predict. And that obviously if you knew a negative thing was going to happen, you would not be in that investment. We all would avoid that.

That's obvious. But there are all, all, every single investment has a risk. Okay? Now, let's start with like a savings account. You could open a CD and make 1% on your money, and you don't have any risk. Oh, yes, you do. Wait.

All investments have risk. What's the risk of making 1% on your money? Well, we just talked about it a minute ago. Inflation runs 4%, 4.2. And taxes are going to take a fifth of what you make, a fourth of what you make, a third of what you make. Okay? And so you've got to make six, but you're only making one,

and so you are losing 5 make six, but you're only making one. And so you are losing 5% a year in purchasing power when you save money at 1%. So you just picked an investment that you thought had no risk, and you pretty much guaranteed a loss in purchasing power. So that one doesn't work. That's one end of the spectrum. The other end of the spectrum is doing high-risk things where you lose all the money. And you play, you know, you go to the roulette table, or you play Bitcoin, or you play gold, or you play, you know, you bet football, or I don't know, whatever you want to call these things that are gambling in essence. And you hope that you hit, and you think that you're the exception and you're going to hit.

And we don't do that one either. So what we do play in is in the middle uh and in the middle i found two things that i'm comfortable with the risk and with the returns and that's real estate which has some risk the renter may not pay the house may burn down it may get flooded a tornado may hit it a tree may fall across it um some government agency may lose their dadgum mind and decide covid means that they have the right to take over the freaking world oh wait that just happened and so uh you know and they shut down you know i had a guy in one of our properties who was beating his wife drinking and tearing up everything had nothing to do with covid it had to do with he's an idiot and we couldn't get him out because they had a moratorium on evictions because of COVID in Tennessee.

That's been lifted, thank God. And we tossed that piece of trash out. Bless his little wife's heart, you know. Oh, God, what a mess. And so, you know, but this is a risk of owning real estate. And people say, well, I buy real estate. Renters will always pay. You don't know anything about renters.

So, you know, some do, do some don't and you do your best just like not all employees work hello and so um this is these are risks you take so you assess the risk versus the return and you accept the risk pretty much know you're going to have some of it and that goes with the returns and if you that out, that's what wealthy people do. And so I buy real estate and accept the risk, and I love the returns. I buy mutual funds, and I accept the risk, and I look for the returns. I don't buy single stocks. A valid investment, but too much risk for me versus the return I get. I've been broke, and I don't need to lose my money.

And so I don't put all my money or a bunch of my money in one company. Although, had you put it in Apple, you would have done well. Had you put it in Microsoft, you would have done well. But I don't do that. I've got friends that have done all kinds of single-stock investments, and it's like a fishing story. They always talk about the one they catch, right? They talk about it on the golf course, right?

Oh, sure. And they always got a story. But it's a risk analysis, Michael. That's what you learn to get used to. There is no formula where you don't take risk and you make money. Doesn't exist. Yeah. It just comes down to how much risk you're willing to take.

And, again, I want to dive a little deeper on that because I know that advice, and I've heard you give it many, many times. You're not saying that it's wrong to do, but it's just really, really risk. And you've learned over time with your track record of investing and the appetite that you had for risk coming out of getting debt-free, I'm just not going to play that game. It's not worth it. And that's really what we need to hear. I mean, you could certainly invest in a single stock, but you've got to be on top of it or you'll lose your shirt.

You've got to really know what you're doing. I mean, I could take $10,000 and put it in a slot machine. Right. But I just don't like the payout probabilities. And that's really important. Yeah. But that doesn't mean sometimes you don't hit on a slot machine. Right.

But I guarantee you I do know who hits on a slot machine. Yeah. The casino. Oh, yeah. They make money on them every day. day yeah no one else does yeah so i mean you start to learn these games and you go that's the game that's the game it's the game so i'm going to measure the risk versus the return and i'm going to accept the risk to get the return and if you don't take enough risk you get tackled from behind by inflation and taxes. If you take too much risk, you lose your money. I want to ask you this.

When you invest in real estate, and of course now you're paying cash here, so we're talking about cash investing in real estate, what are the risk meters you run through before you buy a house that you're going to rent? What are you looking at? Are you looking at neighborhood, of course? I mean, what are some of the things that people need to think through? Well, the first lens we look at is you make your money on the buy right and so is it a bargain which there's no bargains right now right market's white hot you're not a steel you know we bought a lot of foreclosures we bought a lot of stuff in 2008 when the market went down all that but there's

no there's no bargains in real estate right now so i'm not buying real estate right now i'm building some, but I'm not buying any. And so the thing is, I'm looking at the bargain on the front end. That helps me because that lowers your risk then. So if you've got a property that's worth $300,000 and you pay $180,000 for it, you just limited your risk. Yes. And now then, obviously, you've got to look at the property and go is this marketable i mean if it's a weird twisted up floor plan that's not rentable or resellable then there's a reason it was a bargain it sucks right you know so you just gotta gotta use some common sense and go somebody walks up to this are they gonna want to rent it somebody walks up to this later and i want to sell it are they gonna want to buy it And so we're looking at the curb appeal, the quality of the property, the location of the

property, you know, and then what are we going to rent it for? What's the rental market versus what we pay for it? And that's your return on investment. It's a fairly simple equation. And so, but there's a lot of common sense. That's why it's good to buy real estate in your area because you inherently, intrinsically know the area. Yep.

This is the Ramsey Solutions on the debt-free stage, Jarrett and Lori are with us. Hey, guys, how are you? Hey, how are you doing? How are you? Welcome. It's so good to have you guys. Where do you all live? We live in Houston, Houston, Texas.

Welcome to Nashville. Very cool. And all the way to Nashville to do a debt-free scream. Yes. I love it. How much have you paid off? $419,690. Woo! I love it! And how long you paid off? $419,690. Woo!

I love it. And how long did this take? Four years. Four years. And your range of income during that time? Between $250,000 and $350,000. Yo, y'all are killing it. What do y'all make?

What do y'all do for a living? Oh, so I'm a nurse anesthetist, and my wife is a dentist. Oh, nice career choices. Ding, ding. Well done. I love it. So four years, $. Ding, ding. Well done. I love it. So four years, 420. I was going to say house, but when you told me your career, I'm going to say student loans.

Yeah, pretty much 80% of it was all student loans. A lot of student loans. And the dentist usually more. Well, actually, I had a lot from anesthesia school. Okay. Yeah, so I had a lot from school. So about even then, huh? Yeah, about even.

All right. A couple of hundred each. Yeah. Yeah yeah but you're making bank now wow well i'm so happy you guys well done okay so how long have you been out of school uh so i graduated in 2011 and then i graduated in 2004 okay so you've been out a while you're bopping along making some money but this monster is hanging behind you. Yeah, yeah. This dark cloud is following you everywhere, right? That's the thing with student loans. They just follow you and follow you, and then you get out.

What woke you up? You said, we're going to kill this thing. Monster be dead. It was really my wife. Just one day, she just got tired of me always buying stuff, and you get paid because you feel you deserve it, and you're trying to keep up with people, buy nice cars, go place a vacation. So one day she said, hey, you want to go on a date with me?

And I said, yeah, let's go on a date. And then she's like, when I get there, you're there. It's like a smart money conference. That's wrong. Wait a second. That is wrong. She totally just, I was like,

oh, I thought we were going on a date. And it was like a one-day conference. All day, you had to sit there listening to this guy. What a date. All day. I got to know, hold on. At what point did you know you were going to a conference? Was it that morning?

No, I pulled up. I go in, and we literally start walking through the building. I said, hey, is this like a conference? And she said, yeah, it's Dave Ramsey's Smart Money Conference. Oh, that is something. That's cold. Smart woman. Very smart woman.

And probably about four hours into it, I started. I was like, you know what? You're right. We really should get on a budget. I've been spending too much money. You're right. We need to communicate more and just drunk the Kool-Aid. So after that.

What year was this? This was 2017. So it was a smart conference. Yeah, smart conference. Money was just part of it. Yeah, absolutely. We had everybody else there too. Rachel was there, Inky Johnson. Yeah, I remember that one.

At Grace Church. Yeah, it was Grace Church. Yeah, absolutely. Inky's a great speaker. Yeah, it was amazing. And then after that, so then we started looking for FPUs. Then we got an FPU at our church um our you know our fpu mentors like just walked us through we even went again to fpu after that so like they like they really supported us the whole time because four years it was a it was a long drag yeah you are a patient man i i i i'm pretty calm with sharon i'm not sure if she tricked me like that, I'd have been okay with that.

Yeah. But it was well worth it. You did well. You did well. She's amazing. That's cool. Yeah. You had a lot of trust in her.

Yeah. Very cool. Yeah. Let's go on a date all day long. Wow. But it changed your life. Changed my life. And then after that, I mean, even our FPU, just kind of going through it.

Because then you go to the conference and you're like, okay, well, let me get into it. And then that's nine weeks. And our FPU mentors, Yolanda and Stanton, they walked us through. And, you know, you start using cash for everything. I mean, we did everything. Tried to change our cell phone bills, cable. How far were you through the $420,000 before it kind of clicked and you went, I thought this was going to work, but now I know it's going to work.

Well, see, that's the hard part. Because you intellectually get it first. Yeah, that's why you always say it's common sense. It makes sense. But it just kind of comes. One day you realize you're spending cash for something. You're not buying stuff. You're not going on trips. trips for me i used to buy tennis shoes all the time like you know spend a hundred dollars on some you know jordans or whatever and then just one day you just realize like hey this money is actually going down like this interest

is is moving so it just kind of sneaks up on you like it's it's kind of cool you remember uh uh lori where you where you were in the numbers before you went, this is actually going to work. It clicked for me when we paid my car off. Ah. And I was driving my car around with no note. Never had a car without a note before. Yeah. So that is when I said, this is freedom.

Yeah. This is it right here. And you lean in even harder. Yes. Yes. said, this is freedom. Yeah. This is it right here. And you lean in even harder. Yes. Yes. Yeah. That's fun. Man, you guys are impressive.

I mean, impressive incomes and careers, but I mean, what a load of debt. And you did it in four. You paid off $100,000 a year average for four years. Yeah. It was grouty. What did you do to increase? Were you working more hours? Yeah. So some days I was working six days a week.

I was working 24-hour OB shifts. I would do GI shifts sometimes. Just work, work, work, work, work, work, work. There's no shortcut, is there? There's no shortcut. You just work. And then the other part of it is you just stop spending money. Well, you can't spend money because you're working all day.

Yeah, you're not. You're working. That's a good point. Yeah. Yeah. So you just keep going to work and you spend less money. You try to figure out, get rid of your cable. We did the streaming thing.

We did low cell phones. Once you get rid of your car note and that money's yours, you're like, wow, that adds to the snowball. So you just keep pushing along. That's so cool. And now it's all ours. Yeah. Yeah.

I mean, four years later, you break through and you finally finish. How did it feel? Invigorating. Yeah. I mean, like. What did you say, Lori? Invigorating. Invigorating.

The first thing we did was go on a ski trip and just wild out. Yeah, why not? Yeah. You're making 300 grand. You got no payments. Yeah. Where'd you go? Where was the ski trip?

We went to Keystone, Colorado. Yeah, that's nice. I've skied Keystone. Yeah. They used to have night skiing. Do they still? We did have night skiing. We taught ourselves to ski on YouTube.

Oh, wow. Night skiing, yeah. That's a little scary right there. I don't want to think about that that i don't want to think about that what was the adjustment like for those sharp young men right there who went through all this too you know they were with us the whole time because we when we went to fpu it was at church so we would bring them with us so they sat in the back and then so we went to fpu twice with them they listened to you all the time like even we're sitting here in the lobby and they're like oh

dave ramsey like we know this music because the podcast is always on in the car so they've been with us i mean it's pretty much feel like their whole life they're 12 now so you know we started they're right yeah they're yeah they're right so they were just like oh they're twins yeah they're twins awesome okay what are their names so this is uh sean right here no this is nate well they are twins i'm looking down yeah yeah this is nate yeah oh that's so cool you guys very cool all right when people ask how you did it what do you tell them the secret to getting out of debt is uh budget 100 like if you don't know where your money's going you're not gonna you're not gonna know where your money's going so you know you just gotta gotta budget uh communicate be on the same

page we would have budget meetings and they would be fun. I started doing spreadsheets. They weren't fun. Yeah, spreadsheets. It just made it fun. We're like, oh, this is what we're going to do with our money. So that's the number one key. Once you do that and then you commit to it, it's going to happen.

Yeah. You know, I do notice a lot, and I don't know that we've ever said this out loud a lot, but I notice a lot with the debt-free screams that it's not unusual to hear you kind of make a game of it. Once you get to a certain point and the desperation starts to fall off and the hope starts to come, it's like, okay, this is like a game. How fast can I do this? It's like I'm trying to beat a video game or something. That same kind of thing starts happening in your head.

And it's like he started doing that spreadsheet. He had that look. You know what I'm talking about? He's like, yeah, yeah, yeah. Because you start to feel it. And you go, yeah, I'm going to beat this thing. I'm going to the next level. Yeah.

Absolutely. Absolutely. Very cool. Very cool, you guys. So well done. And so you had all kinds of encouragement from FPU. You mentioned your mentors. Yeah.

That's good. That's your biggest cheerleaders. Alright. Alright, Nate and Sean, baby. Four years coming. Debt-free scream. You've been hearing them. Now you are one. Get ready to do it. Whole family tree has changed. Your mom and dad are absolute heroes. Man, you guys are rock stars. It's an honor to meet you.

$420,000 paid off in four years. Make it $250,000 to $350,000. Count it down. Let's hear a debt-free scream. One, two, three. We're debt-free! We're debt-free! Yeah! Our scripture of the day, 2nd Ephesians 2.10

For we are God's handiwork, created in Christ Jesus to do good works, which God prepared in advance for us to do. C.S. Lewis said, you are never too old to set another goal or to dream a new dream. It's an interesting thought from Ephesians there, Ken, which God prepared in advance for us to do. Good works. And, you know, you always say you're put advance for us to do good works. Yeah. And, you know, you always say you're put on this planet to do something. You don't do it, somebody's missing out. That's right.

You were created to work. And you're created to do something. That's right. You know, you're given a certain set of skills, and God's got a certain thing in mind. Now, it's not if you miss that one little nuanced thing that you miss God's will. We're not fatalistic about it. But there's a range of options. But, you know, you're put here to do certain things with your gifts and talents, and if you don't do

them, then the culture, society, the nation, the world is let down. That's right. Your purpose isn't actually about you. Your purpose is to give yourself away. You were gifted with something to give away. And, you know, look, if you take the word workout and I say created to contribute, people go, okay, now I can buy into that. Because work's got this nasty, ugly word about it, unfortunately, because of the toxic view of work in this world. But, yes, you were created to work.

Well, our friend Rabbi Lappin, Orthodox Jewish rabbi who wrote Thou Shalt Prosper, I can't get it out of my mouth, says that the Jewish view of work is very similar to the Jewish word for worship, that the way you do your work is a method of worship. And I love that picture. That's a beautiful thing. So Ken is doing, a week from tomorrow night, the Get Hired event. It is a live stream this coming week from Tuesday night. It's $20, and if you want to view it, we've got a few slots here live in the building for a live studio audience purposes,

but just a handful if you're here in the Nashville area and want to come. If you want to view it, and people are going to do that literally all over the world, tickets start at just $20. And you can text HIRED to 33789 to learn more. The Get Hired event, Tuesday, April the 27th. Text HIRED to 33789. Courtney's in Birmingham. Hey, Courtney, welcome to the Ramsey Show. How can we help? Hey, Dave.

Hey, Kim. How are you? Better than we deserve what's up um so first off i'm gonna say you have completely changed my family's life you completely changed our life and pretty much everyone that we know thinks we're a little bit crazy um so I guess that's good. But my main question to you is this, is my husband has been put in for a promotion. And with that being said, they are giving him a car allowance. And there are requirements on the year and the model and such. So everything I'm looking at is a ridiculous amount of money for a car. What does he do?

So he would be like a sales rep for heavy equipment. Okay. That's what he would be going into. That's the promotion they put him into, which is great. It's a substantial amount of income increase. But we're in baby steps four, five, and six. What are the requirements on the car? So it has to be maximum is five years that it has to be, and then under $120,000.

We drive old cars. What is he going to be making? So he would be making, starting out on scholarship, he would be making right at $60,000. What's scholarship mean? Before he goes on commission. When he's on commission, what will he be making, do you think? The guy that was in the area before him was bringing in between 80 and 100 okay what does he make now right now he makes 42 okay cool and um you don't how much money do you

have in savings right now we have just baby step three which would be 15 okay all right and when will they be moving him into this role may 1st okay all right so he needs to negotiate with his supervisor to give you time to save up to buy a five-year-old truck okay and because that's what he's going to be wanting. He's out calling on heavy. But here's your rule. You always want to drive the cheapest car possible to get the job done. Now, you're going to lose money on the car allowance. How much is the car allowance?

So the car allowance is $600. Yeah, you're going to lose money. Yes. That's only $7,200 a year, and a stupid $20,000 truck is going to go down that much, as many miles as you put on it. Absolutely. Okay, so the car allowance is not a blessing. It's not a benefit. Now, they walk around strutting around with their chest stuck out like it's a benefit. It's not. They're ripping you off. It's a bad deal. The good news is he's going to triple his income, and so it's probably worth it.

Okay. But the car allowance sucks. I would rather them give him a truck as a company car. As a company car. Just give me a company car and keep your $600. You would come out a lot better. This is the reason they don't do it. Yeah.

Yeah. And $600 is everywhere. Lots of people have 600 car allowance so but you're going to lose money on that with a loss in value not to mention everything else that you're going to have so what you've got to do is you have to continuously fund a move up every few years in truck to stay within the guidelines right and so out of your overall income which includes the 600 but the 600 is just part of your income, you keep saving money to move up and truck every so often,

and you keep a four-, five-, six-year-old truck, because whatever he's driving, he is destroying its value because he's putting a bazillion miles on it, and he's on rough sites, so he's really putting hard miles on it. Yes. So whatever he drives, it's a cost of the job so you're going to lose 10 15 000 a year on this operation and you're going to receive seven so just kind of count on that that's okay i'd still do it because i think the promotion's big enough to justify it.

But if they were giving him a $5,000 a year raise, I'd turn the promotion down. Okay. Because it's not that great a deal on the car part of it. The car part's a bad deal. Okay, but go ahead and talk to your supervisor and say, it's going to take us a little while to save up $20,000. We don't have it, and we don't borrow money. Well, just use your car allowance to pay the payment.

No, because if I ever lose this job, I've still got the stupid payment, and I don't borrow money. Well, just use your car allowance to pay the payment. No, because if I ever lose this job, I've still got the stupid payment, and I don't have the job anymore. So you don't use your car allowance to pay payments. So I'll get a truck as quickly as I can. In the meantime, I'm driving this, and I'll get one probably about September or so, or whenever it is you can save up the money, right? Yeah.

Do you work outside the home? I work inside the home but i do what's your household income insurance um right now before the raise it would be 80 so it's going to be 100 so doing that you can save up to get a 15 20 000 truck that'll meet the guidelines barely pretty quick but you're going to have to you won't do it by may 1 so they're going to have to give you a little grace, and they will. If you just stand with your heels on the ground and go, no, I'm not doing it. I'm not going into debt to get this promotion. If you want me to have that nice a truck by May 1,

you're going to have to give it to me. And you want to give me a company car, I'll take a company car. I'd rather have that, by the way, if they want to negotiate with you. But they don't. Their CFO has already run the numbers. He knows what he's doing. She knows what she's doing. That's why people are getting out of the company car business.

We see it every day, don't we? Oh, yeah. I mean, listen, they know what they're doing. Like you said, the financial institutions, these CFOs, the numbers aren't stacked in your favor. So don't just take it as, well, I kind of got to do it, and this is a good thing. You know, it kind of feels good psychologically to hear the term. I got the $600, so I can use that for a payment. They go take a $600 car payment.

It feels good. It's not good. Yeah. Well, because you're stuck. You're borrowing money for this major corporation, and you're broken, they're not. I mean, this is the greatest scam on earth. But it's part of the gig, and, you know, you don't have to be mad about it. I take the job.

I think the job's a good job, especially right now, man, moving into heavy equipment with this coming economic boom in construction. Oh, my goodness. Good time to be in construction. So, Ken, good show today. Thank you, sir. Always fun. That puts this hour of the Ramsey Show in the books.

Our thanks to James Childs, our producer. Kelly Daniel is our associate producer and phone screener. I'm Dave Ramsey, your host. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast.

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