The Ramsey Show - App - If You Can't Afford Something, Don't Buy It!

Episode Date: April 1, 2022

Dr. John Delony & George Kamel discuss: Quitting your job to start your own business, When it makes sense to re-finance, Should you buy a property if you can't afford it? What to do with a multi-million dollar settlement. 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

I'm out. Live from the headquarters of Ramsey Solutions, this is the Ramsey Show, where America hangs out to have a conversation about your money, your life, your relationships, your work, any of it and all of it. I'm John Deloney, joined here by my good friend george camel and we're taking your calls live 888-825-5225 kelly is standing by to take your call let's go out to francisco in topeka kansas what's up francisco how we doing hey can you guys hear me all right absolutely what's up my brother hey i just wanted to start out by saying I'm such a huge fan of the show. I've been listening for quite some time, and because of you guys, my wife and I have been able to pay off almost $100,000 in debt.

Wow. Way to go. It's fantastic. How much further do you have to go until you're debt-free? We are making our last payment. We're saving up. We've got $2,000 left, and we're going to make that payment next week. Yeah, Francisco. Way to go, dude. Well, all thanks to you guys. You guys have really made a difference.

We didn't do anything. You did the hard work, and you all grounded out together. I'm proud of you. So what's up, man? How can we help today? Hey, so I just wanted to ask. I am married with a wife, a beautiful wife, and two beautiful babies. And I'm getting to a point in my life where I kind of want to start my own career.

I'm 26 years old. I want to start my own business, sorry. I work for a company. I do pretty good. I make about $50,000 a year. And I recently was given an opportunity by an acquaintance of mine to go work for him as a carpenter. Um, it wouldn't pay near as well starting out, but I would be starting with him with the understanding that he's going to teach me the ins and outs of running my own

business and eventually, um, branch out on my own. So my question is, what do you think is a good amount of money to have saved up to get started with that? You know, should I have the emergency fund plus some other things or at what point in the baby steps do you think I should start? What type of pay cut are you talking? So starting out, I'd probably be making about $40,000 a year. Okay, so it's not like you're going to $15,000 a year. Can you make your bills with $40,000 a year? Oh, yeah, absolutely. Our house is paid for.

So once this debt is done, I mean, we're just going to have regular bills. So two different times in my career, my wife and I sat down and looked at what our lives were like at the moment and a potential career opportunity. Two different times I've taken pay cuts. One time our household income pay cut was very, very significant to go to another career, another job, same career, another job at another university in another city. And within short form, we had earned it back. And then I've taken – I've done that. So I've done it twice. It's worked out for me both times exponentially so.

And so the keys, I think, are asking yourself, what are you going to get out of this thing? And what is the calendar date when you're going to say, I'm ready to go? Meaning, if you just get in there and do this forever, there's a real easy possibility that you're making $40,000 six years from now. And you've become this person's live-in apprentice. What are the skills you want to acquire? And are you on the side practicing the career career that you want to to get into the business you want to start right so you can be doing both and so enter into this season as a student and as a practitioner and it's going to be really busy for two or three or four years

you're saying so it's less about you've got a you got a house paid off you're about to be completely debt free you can cover your bills obviously george, he's going to want to get an emergency fund. But do you hear what I'm saying? This is about letting your wife know, hey, for the next two or three years, we're going to be grinding because I'm going to be learning. I'm going to be hustling.

I'm going to take on a second job so I can start practicing these things I'm learning. And the goal here is in two years, in three years, in 1.5 years, I'm going to be ready to launch and do my own thing. Do you hear what I'm saying? Yeah, absolutely. I mean, it helps a little bit. I do

have about half a year experience doing trim carpentry before the job I have now. That's what I did for a little bit. But it sounds like the carpentry part is less the issue. It's more, how do you get jobs and how do you do marketing and what's the books like and how do you plan and bid jobs? That's the stuff you're going to be learning, right? Right, right. Exactly. So what's in it for this guy to teach you and then help you launch a competing carpentry business? So, honestly, he's just a really good guy. He does it for a living, pretty much.

He's had two or three brothers that he taught up in the industry and then basically turned them loose to run their own businesses. And I just happened to be on a job site with him and, and he's like, Hey, you know, if, if you ever decide you want to get into carpentry, you know, let me know. Could you help him part time while keeping your job? And then eventually you launch on your own as you start to build your own client base? I could do that. Yeah.

I think that's the absolute smartest way to go. Do this on the side. client base? I could do that, yeah. I think that's the absolute smartest way to go. Do this on the side. Send me to work for you six hours. I'm going to be there all day Saturday for the next year. I want you to come over to my house and let me look at your books and see how these things work. I'll provide the nachos and the drinks and we can just figure this out. But make it a regular thing.

But yeah, I think George is right. I just don't like dropping everything you have on the promise that this guy is going to give you this, and he's going to teach you this, and he's going to help you launch the business. He does sound like he's a good guy, but I don't want you to make that kind of risky move before you know this is exactly what I want to do. Yeah, absolutely. That makes sense. But get that emergency fund in place. You can get a floating fund on top of that if you want to split the gap. If you do end up making the jump, let's have $10,000 there to go, all right, this can help me keep the income we have,

if that's all of your household income. George, you talk with young entrepreneurs a lot, and there's this fire burning between I have a particular thing that I want to see out into the world, and then you talk to other entrepreneurs who are, I just want to go do my own thing. I don't really care what my own thing is. I'm going to go buy a car wash franchise.

I just don't want to work for the man. For the man, right? Yeah. Oh, they'll get into the vending machine business. They'll get into real estate, house hacking, you name it. They don't love any of that. What they want is some easy, quick money. And there is no such thing.

Okay, so that's helpful for me. So there's the entrepreneur that's like, I want to fix healthcare in my local community. So I'm going to develop a courier business that helps with it. That's an entrepreneur who sees a gap in the market, who has a hole in their heart that they want to fill by serving other people. I hate the pizza in this community. I'm doing something about it. I'm starting a pizza company where the pizza's not garbage. That's a mission worth solving. I agree. Man. But then there's the other entrepreneur that it's not about

entrepreneurialism. It's a, I just want to hack my way through this. No, they saw the TikTok video about the guy who has a vending machine and he makes $100 a month on this vending machine. If you can do that 28 times, you can make some easy, quick money in a few months.

Gotcha. And it's just never that easy. And so I think in people's minds, they have this picture of, man, I can stop working for the man because I hate my boss and I hate what I do, and I can go work for myself. Replacing Skittles all day, and I am free. And so I just want people to find things they love to do. And usually when you do that, you're going to find a way to make money doing it. Yeah, and if you find things to do that fill that purpose need in your soul, right?

Yeah. What am I doing here? And Francisco clearly loves carpentry. Yeah. He's not doing it to make a quick buck. He just is drawn to that world. That's awesome. We need good people in the trades and our community. He wants to start his own thing. Great. And he's doing it the right way, which is I'm going to learn how to run a business and how to be a carpenter.

You know what, Francisco? We're going to send you a copy of Entree Leadership. That's Dave's playbook on business and leadership, and I think it's really going to help you and get you inspired on the business end. It's awesome. We'll be right back on The Ramsey Show. you've got a lot on your plate a job your home your marriage and your growing family while you're enjoying the present you can't help but think about your future and your finances. As you explore your options, consider Christian Healthcare Ministries, or CHM, for your health care.

Their generous maternity program and budget-friendly monthly programs have been a blessing to members welcoming children into their families. Visit chministries.org slash budget to see if it's right for you. Christian Healthcare Ministries is a Ramsey-trusted provider. 888-825-5225. This is the Ramsey Show. I'm John Deloney, joined here by George Cameron. We're taking your calls on money, life, relationships, and tax season is ending soon. If you're filing online, which is 95% of you, you need to find affordable tax software you can trust.

That's hard to do when so many companies claim their tax software is free, then charge you anyway. Who would do that, John? I don't know. Who would say this is free? Sorry, I had a cough there. Did you miss that? I heard the FTC. Yeah, you know me. They're all over it. Sue's TurboTax to stop misleading ads for free tax prep software. I preached this, John, on the fine print. Episode one was all about how TurboTax to stop misleading ads for free tax prep software. I preached this, John, on the fine print. Episode one was all about how TurboTax is screwing you, and this is just one of the ways. I think somebody forwarded your first episode of your show to the Federal Trade Commission. We did it, John.

Well done. But seriously, the key with these software, they always promise you the world, and then they charge you all the fees. And what I love about Ramsey Smart Tax is we said, hey, what if we just made a product that does what we say it's going to do and charge you what we say we're going to charge? It's that simple. Anytime you look on TV and it says, come over here, this is free, I can rest assured you that no one paid the advertising fee to say, come get our product, and we want to make nothing on it.

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slash smart tax. That's ramsaysolutions.com slash smart tax. Let's go to Debra in Aiken, South Carolina. What's up, Debra? Hey, John, George. Good talking to you. Hello. It's good talking to you. What's up? Happy Friday. Yes, ma'am. What's up? I'm not calling you for financial advice. Fortunately, I'm very blessed. My husband and I are out of debt. We've got money in the bank, and, you know, we're blessed. Very cool.

I'm just calling to tell you that I think you guys have done an outstanding job this week. Been listening all week. We know Dave is the man, but you come in awfully close to second place. I think you've done a great job, and I just wanted to give you a pound back. Wow. Well, I'm grateful. This isn't an April Fool's joke, is it? No, sir.

You are. You've made my whole. Listen, off air, George is like, hey, John, I don't know how to tell you this, but you're doing a terrible job. And, Debra, you have lifted my spirits. It's not true, Debra. You know I love John. Well, that's so kind, Debra. That really does mean a lot. We have big shoes to fill, obviously. We have under no illusion that we are Dave or close to Dave. He is the goat,

as the kids say. But we are honored to sit in this seat and help folks like you every day just take the right next step for their money, their work, their relationships. And it means a lot that you reached out today. Thank you so much, Deborah. Well, my goal for this year is to get my daughter to listen, and maybe she'll learn a thing or two about money. What's her name? Deborah, what's her name? Her name is Sarah.

All right. So I'm going to say something into the camera, and you can clip to YouTube and just send it to her. Sarah, listen. Number one, your mother loves you. She's pretty rad. You know that. I know that.

We all know that. Number two, you are worth being well, and you're worth sleeping at night, and you're worth laughing from your guts, and you're worth taking yourself out to eat every once in a while, and you're worth not being anxious and panicked all the time. And most of that starts with intentionality most of us starts with saying no more i'm going to live differently so here's what we're going to do deborah i'm going to send you for free a year subscription to ramsey plus that you can transfer to your to your daughter

okay awesome now daughter listen to this your mama loves, and I just sent you a product for free. You got to use it. If you don't lose it, that means you don't love your mom at all. I'm just kidding. That's not what that means at all. But we're all on the same team here. You got it. Debra, thank you so much for giving us a call.

You have lifted our spirits today. Thank you, thank you, thank you. Let's go out to Eric in Pensacola. Hey, Eric, what's going on? Hey, guys, can you hear me you got it what's up man hey uh i've got a quick one for you we just bought our house my wife and i just bought our house and we got a 30-year loan and we've only been paying on it for about six months should we go ahead and refinance it for a 15-year fixed loan well it's not necessarily a situation where we always just say yeah go ahead and refinance because we love the 15-year fixed loan. Well, it's not necessarily a situation where we always just say, yeah, go ahead and refinance because we love the 15-year.

While that is true, you've got to look at the fees, the closing costs, the breakeven analysis on all this. You just got into this house, and to turn around and refinance it, there's going to be fees associated with this. And so what I want you to do is get the quote and go, okay, it's going to be $4,000 for closing costs. How quickly will we make that up with the interest savings? So have you done that yet? Have you seen what the interest rate is on a 15-year compared to what you have? No, I have not. What's your interest rate right now? We were just so excited to get the house. I didn't even think about the 15-year loan. Of course, they don't tell you about the 15-year loan because they don't want you to get it. They want you to get it as long as possible. And then I started listening to you guys and I'm

going, oh, I should have got a 15-year loan. Well, the good news is you can pay off a 30-year loan because they don't want you to get it. They want you to get it as long as possible. And then I started listening to you guys and I'm going, oh, I should have got a 15-year loan. Well, the good news is you can pay off a 30-year loan in two years. You can pay off a 15-year loan in two years. And so it's all about your intensity. But if there are going to be some cost savings in it for you, if you're going to be in the house for a while and you go, all right, two years from now, this will have been a good move. Now, interest rates are going up, so who knows if you're even going to save all that much right now refinancing to a 15. If you're on a fixed year, 30-year, there may not be a ton of cost savings at this point. I would still focus on it like it's a 15 year or less. I want you to pay this thing off way faster than that. How fast do you think you could pay this thing off as is? It would take some reshuffling on the budget,

but we can definitely do that and start paying more towards the mortgage than we do. I mean, right now we're only making a couple hundred dollars more than the mortgage payment on the principal. Hey, you've been there six months. That hurts, doesn't it? You put all that money in. You even pay extra, and you look, and you're like,

my principal went down $11, right? You said that big day, but it barely goes down on that $30. It's killer. Are you guys paying PMI? What's PMI? I don't even know what that is. How much money did you put down? What percentage? We didn't put any down. I'm military, so we used a VA loan, so they didn't require any money

down to get it. We've already got instant equity. It's a $400,000 house. We got it for $200,000. It was a family deal. Well, there's a lot of fees baked into those VA loans, and they're under the guise of, hey, we're helping out our military men and women, and they're not a great option. We actually prefer a fixed rate option, a traditional conventional loan in a lot of cases. So here's what I would do. Reach out to our friends at Churchill Mortgage and let them know your situation and look at the numbers. They can help you do the math and go, hey, I want to make sure this is a good idea. And they'll run the

numbers for you and show you exactly what that looks like and help you make an educated decision. Okay. Churchill Mortgage, got it. That's the one. And hey, Eric, I personally just did a refi with them a few months ago. It was one of the best business transactions I've ever been a part of. They told me the truth. They busted it. They answered all my phone calls.

And I'm super annoying when it comes to house stuff because it's just a trigger point for me. And I asked a thousand different questions. They were extraordinary. And, again, who knows? The interest rates have changed. That's like a snow globe right now. So it may not make sense financially, but here's what I know. The first thing the guy told me when I called him at Churchill and said, I want to refinance this and collapse my payment down. He said, I'm going to look at the numbers and I'm not going to take

your money if it's not the best thing for you and your family. That was the first thing he said to me. Okay. So you're not going to get ripped off. They're going to tell you, we can't help you because of the interest rates, because of the current market. It would be in your best interest just to double up on your mortgage right now. It's interesting for you

guys, for me to hear someone else say that they wouldn't recommend a VA loan. I've never heard that before, so that's interesting. I'm going to explore that a little bit. Let me say this. As a taxpayer who's not a veteran, I support taking care of you guys better than the VA loan does. It doesn't do a good job. It's got a lot of baked in fees. Helps you get into a home, but it doesn't help your financial future. Thanks so much for your service, brother. We'll be right back. 888-825-5225. This is the Ramsey Show.

Let's go out to David in Denver. What's up, David? How are we doing? Good, thanks. How are you doing? I'm great, man. How can we help? So I've got a business in an 8,000-square-foot building.

I have half of it. My rent's $3,000 a month, and the other guy pays $3,000 a month. My lease was up, and I went to the guy. I said, hey000 a month. My lease was up. And I went to the guy. I said, hey, I'd like to buy this building. He said, well, I don't really have a place to put this money. Because I can't make it as much as I'm doing. But I'm getting older.

I'll be happy to sell it to you. Why don't I carry it for you? I said, all right. So he wants me to do $100,000, $5,000 a month for 10 years, give him his $700,000. I'm planning on working another 15 years anyway. Why wouldn't I do that deal? Something feels fishy here. I don't have to go to the bank.

I don't have to go to the bank. Yeah. I don't have to go to the bank. I don't have to get an appraisal. The building might or might not appraise for that much. What's your business? But I don't have to get an appraisal. I'm a pharmacist. Okay. So...

Yeah, so you're making products? Well, I'm a hybrid pharmacy. I sell regular prescriptions, and then i do compounds as well there you go okay here's my concern you're in you're in hawk to a building to a guy you're working towards it he still owns the building and if he passed go ahead he's gonna i would have to set it up to my attorney. Basically, he's the bank. Well, I would own it, and then he would be in first position to take it back

if something would happen and I'd blow up. I'm not worried about you blowing up. I'm worried about him having a heart attack next year and his kids coming in saying, I want that building back. Give us $600,000 and we're taking it. That's what I'm worried about. So I got to get this legally. No, no, no, no.

Legally sent. Or don't go into debt to buy a building, man. What I would tell you is you can't afford a building to own your place. No, I'm going to be there. So I have to pay the $3,000 anyway. And I already paid for the build out six years ago. So I'm going to be there paying the $3,000 anyway and the rent would only be I mean the payment team would be $5,000 I have an extra thousand that I'd be making. In the $100k down do you have that? Yeah I got that. How much money do

you have in cash right now? Oh so I have a Schwab account. It's well over a million. But that's retirement, right? Are you talking about a taxable brokerage account? That's retirement. We're not touching that. No, I don't want to touch that. So non-retirement money, how much do you have?

Between $80,000 and $150,000. It just varies on my cash flow on my business month to month. Okay. I just feel like 10 years, that's a lot of future to be planning for when we don't know, are you going to outgrow this building? Are you going to move for the next 10 years and you're stuck with a building you're paying on and no way to get out? Well, so it's the best corner

in this old town area. Here's the thing. In your head, you've already decided to do this. What I'm going to tell you is you've done the math. I haven't talked to my accountant yet. I'm still bouncing it off. I'm still bouncing it off

some other financial people. I was driving home today and I'm like, I'm going to call these guys, see what they think. So here's what I think. I think you are locking yourself into a 10-year deal in the highest peaked-out real estate market in the middle of a highly tumultuous economy. And you're locking yourself into 10 years

where somebody else is going to be the bank, and you're not going to get an appraisal on the building, you're not going to get an inspection on the building, it's all good, I've worked here, I'm just going to pay. So you've done the math problem in your head, but you haven't done the millions of people that we deal with who lock themselves into good math deals by borrowing money from somebody.

When yes, it just feels like when I'm renting, I'm just throwing crap out the window. I'm not getting equity. Cool. I get that. I get that. I get that. But you're locking yourself into a decade-long deal.

Man. And what goes happen... My whole career has been what happens when the things we thought were going to happen don't happen that way. And that's why I don't borrow money from people. Even though it kills me to pay rent, even though it kills me to not be able to buy the field right next to me that I really want to buy next to my property because I don't have the cash for it right now. It kills me. I could go to the bank and get the bank and wouldn't I be in the same situation? I'm just telling you don't borrow money on a building.

You can't afford it. And I know that sounds weird because you've got a million dollars in the bank and you make great salary, but you don't have the cash to buy this building. But I'm still going to be paying the, in 10 years, I'm still going to pay out the $600,000. Or in year two you move or the building gets condemned in year three. You see what I'm saying? Well, so there's a brand new roof. So when I walk into that building...

So you say, hold on, David, you're already going to do it. So just go do it. It's cool. I mean, you're a grown man. You can do what you want to. You're clearly really smart. The train has arrived at Justification Station, and I don't know that it's going to depart anytime soon.

So I'm telling you, I wouldn't do it. John wouldn't do it. You may do it, and it's the best move of your life. I just don't know. And that level of, I don't know, gives me pause. Here's what I know. I know Dave sat, um, and cobbled together building by building by building until he could come up with the millions, the tens and tens and tens of millions of dollars it took to have his own big place. Like we have right now, it took 20 something years. And so under your under the same math problem you're working with we should have built this campus 20 years ago

it would have been paid off and it would have been better financially down the road theoretically but it could have been catastrophic and the whole thing's over and so i yeah george said it best he's not gonna going to do it. I'm not going to do it. Dave wouldn't do it. Nobody here would do it. You are free to do that, man. You're a smart guy. I think you are leveraging yourself. You're doing a math problem, and it kills you to make these rent payments. I totally get that.

I'd rather see you say, hey, in two years, if you told me you had a two-year deal and you're going to buy this for $500,000, and he was going to finance it out for you. I wouldn't have a problem with that if he was going to take it directly from your earnings. That's a totally different story, right? $700,000 for a building that won't even appraise it. Yeah, the whole thing just feels gross to me, man. It just feels messy. It feels like that dude is winning and our friend here, David, is not.

That's how it feels. There's something that we don't know here. But on another note, John, we are just days away from your book releasing. That's right. How does that feel? It's good, man. This is wild stuff, and this is what's really cool. I haven't seen us do this before, John.

Own your past, change your future. If you preorder it by April 4th, we're going to give you the e-book the next day on the 5th before the book even releases. That's two weeks earlier than the book's available to the public, which is really cool. Oh, you can get it in a couple days, huh? Yeah. I didn't know that. So we gave advanced copies of the book to some listeners, and they're going crazy about it. I saw you out here in the lobby.

That was a little fun treat for them. You just started handing out pre-release copies. That was awesome. And what I'm seeing from the reviews that are already coming in is that it's helping people understand a new and healthier way to handle their thoughts and their actions so that they can be well and they can be whole. Yeah, there's 10 million books about this thing

and how to fix this in your marriage and how to fix this in your life and you should follow this plan. Man, this book is not me talking at anybody. This is me sitting down saying, Hey, if you and I were just having coffee and you were telling me what you're struggling with, what your sister's struggling with, things going on in your family when you grew up and you're trying to make different for your kids, this is what I would tell you. Right. And this

is the path that I've walked on. This is the path that my family walks on and we're still trying to figure out what we're doing. This is the path that I've sat down with my parents and with my siblings. And so, yeah, I mean, this is just me and you, me and you having a conversation about how to do life better. And mental wellness is a super complex topic. You've been in the education world, two PhDs. And I feel like a lot of people in that space like to write to make themselves look smart and make me confused.

And what I love about this book- Not really, but I- That's how it feels. That's right. That's right. I'm entitled to my feelings, right? I'm a millennial of you. But you wrote this book in a conversational way that even I can understand and I can take some real steps toward improving my mental health, my relationships as if we were sitting on the front porch. So go check out John's book, pre-order it today. Own your past, change your future for just $20. RamseySolutions.com is the place to do it.

I'm so pumped for this book, John. Thanks, man. Let's go. Thank you. Today's scripture of the day is a deep cut from Zephaniah 3.17. The Lord your God is with you, the mighty warrior who saves. Dale Carnegie says, remember, today is the tomorrow you worried about yesterday. That's fantastic, Dale. It's a riddle wrapped in a rhyme. I've never even heard that quote. Dale Carnegie, remember, today is the tomorrow you worried about yesterday.

I'm just going to go straight to Alex in Kansas City, man. That's all I got to say about that. What's up, Alex? Not much. How you been, man? Excellent. What's up? How can we help?

Well, I'm 17, and here in about two weeks i turn 18 and i gain access to a trust fund from some lawsuits when i was a kid for some medical issues okay and it's quite a bit of money and i was just calling to see like uh what what do i go like what do i do about that like it's how much money it's more money than I've ever been accustomed to. How much? 3.5 million. 3.5 million. Okay. Are your parents in the room with you? No, they're not. I asked that the wrong way. Are your parents in your life? Yeah. Yeah. Okay. Are they going to be helping you with this? Yeah. I understand. Okay. When it comes to this amount of money at your age, it would do you a solid to have a long pause before we do anything with this money.

And there's going to be a lot of people who are going to want a piece of this, who are going to be happy to help you manage this money. Alex, people are going to come out of the woods. They're going to come off your roof. They're going to come out of everywhere. Now, have you had a job before? I've always had summer jobs, but I'm an athlete all year round, so it's just like a summer gig. Okay. Well, there's only three things you can do with money.

You can give it, you can save it, and you can spend it. And at your age, I would focus on the first two before the spending part because this can easily become like Richie Rich style. You're like buying the mansion, you get the fancy car, and at 17 years old, you still have like another, I don't know, 80-something years to live. And so if you manage this well well you won't have to worry about money ever again or you could go full prodigal son and it could be gone tomorrow yeah is it okay

for for me to like go out and like purchase a house at like 19 next year i would not like is that okay do you need a house it's not a matter of okay. Yeah. Why would you do that? I mean, I don't know. It's just like, it seems like a smart thing to do. I live 4,000 miles away via one, two, three, four cities away from where I was at 19. The idea that you'd buy a house at 19, I just don't know why you would do that. Yeah, you've got the money, but I don't know why you'd do that. Are you going to go to college? Are you going to go to school?

Yeah, yeah. Was there money saved up for that outside of the settlement? No, that is part of, like, that's going towards my college. Okay. So I would sit down with your parents and say, what's the game plan with this money? We're going to go to college debt-free. Go buy a car.

And don't buy a Tesla. Buy a used truck and get yourself to and from school. Listen to me, Alex. I'm asking you to do something that most people on planet Earth would not do. And that is to look at $3.5 million to buy a $20,000 car. Okay? Most people would not have the discipline to do that. And you're taught, you're, you're, you're acting now for 35 year old Alex and your two or three

kids that you don't even know yet. You haven't even named them yet. Okay. So I'd put the rest with your smart investor pro and they're going to not put their hands in all your money. They're not going to spend all their time trying to figure out how they can bilk you out of this thing. And you're going to let it grow and grow and grow. Do you have any debt, Alex? No, none. Okay. I want to keep it that way for the rest of your life,

and that's going to help you make the most of this money. I want you to have an emergency fund once you have a picture of what your life looks like, maybe beyond college, of three to six months, and I want you to be investing 15% of your income from whatever job you have. So let's pretend this money isn't there. Then when it comes time to buy a reasonable car like John's talking about, we do that with cash. When it comes time to buy a reasonable house, maybe once you're married, maybe we do that. Beyond that, I want you to assemble a team.

And you can do that at RamseySolutions.com. We've got people in the tax industry, in the real estate industry, in the investing industry. You've got to start assembling your team of people who care about Alex, who want Alex to win, who can help you do things the smart way, who have your interest at heart. And so that's what your best move right now is. Make a game plan with your parents and assemble that team of people who can help you manage this well and be a good steward of what was given to you. Hey, Alex, this is a hard question I'm going to ask you. Are your parents trustworthy? My mother, yes. Okay. If this money has specific legal designations, this money is for you, this is your money. I can see a scenario,

and I'm not saying this is your parents, your dad or your mom, a scenario where people want this, your parents want this money to pay off their house, pay off their debts, to pay off their things. So if you find yourself in a situation where you are feeling uncomfortable,

that other people are using you as a lottery ticket. It might be a cousin. There are going to be several cousins that come out of the woods on this one. It's best to say, I'm going to not continue this conversation right now and go get with a smart investor pro, go get with a legal professional.

This is enough money that I might even reach out and get an attorney that's going to help me walk through this and at the end of the day, protect me, not from myself even, but protect me from other folks around. Man, the fact that you're 17 years old and you thought to make the phone call that you're thinking, I want to do this right, tells me that you're way, way ahead of the game, man.

As George said, you've got 80-something years to go. So slow play this. You're in no hurry. You've got your college taken care of and that's the next, what, three, four, five years of your life. Then let's invest in Alex right now because he still has to live a life. He's going to work a job. You're not just going to live on an island somewhere. But if you invest, I did some math for you, invest 3 million of this over 30 years, you're going to have upwards of $50 to $60 million sitting there. Imagine what you could do for your community, the ways you could give. Man, that's inspiring to think about.

Exactly, man. Because you were a good steward of this and didn't blow it to look showy on Instagram. And I don't feel that from Alex at all. No, man. But, man, that's a lot of weight to put on a 17 year old. Yeah. So it's a lot. Call us back if you need help along the way, man. We're here for you. All right. Let's run out to the town I was born in. Chris in Houston, Texas. What's up, Chris? Hey, thank you so much for taking my call. You got it. What's up? All right. So I'm in a situation where I've been paying you on a car for two years now,

and I have about two years left. I'm paying $497 a month, so about $500. And I just started listening to the Ramsey Show for about a week, and I love what I'm hearing. I wish I would have heard it two years ago. But my question is, if I should sell my car, I keep on paying it. What's left on the loan? $11,000.

And what's the car worth? I actually called a dealership today, and they said $11,000 to $13,000. Okay. I want you to check about four other places outside of just a dealership. Facebook Marketplace, AutoTrader, Kelly Blue Book, Carvana Room. I did a Kelly Blue Book, and I did a Carvana. Carvana hasn't gotten back to me, but the Kelly Blue Book was about also like $13,000 or $14,000.

Okay. How much money do you have? Man, I've been so bad with money. I'm glad I found the Ramsey Show. All I have to my name right now is about $1,700. Hey, Chris, hold your head up high. We've all been there, okay? Oh, yeah, for sure, man. Same team?

I'm on the right track now, I feel like, and I'm trying to get rid of my debt, man. That's good. How much debt do you have outside of the car? What else? Like overall total? Yeah. Like my entire debt? Man, I just bought a house.

I'm in about $65,000 in debt. Outside of the mortgage, including your house? Yeah, because I bought a trailer house, a manufactured home. So just the car debt outside of that. All right, here's what I want you to do. Sell the car for $14,000. Then you have $3,000 left over. Take your $700 that leaves you with $1,000.

Go buy a $3,700 car to get you around for now until you can upgrade and get yourself out of debt. Chris, we're walking with you, man. We've all been there. Keep your head up high, and let's start making good choices from this moment forward. I'd like to thank George Campbell, James Childs, Ben Hill, Kelly Daniel, and even Zach Hendon. America, laugh often, be generous, be kind, turn off your screens, and don't outsource your life. We'll see you soon on The Ramsey Show. Hey, it's John Deloney, co-host of The Ramsey Show. Did you know over 18 million people listen to The Ramsey Show every week?

A lot of those people listen on one of our 600-plus radio stations across the country. To find a station near you, go to RamseySolutions.com slash show.