The Ramsey Show - App - If You Race To Build Wealth You’ll Fall Flat on Your Face

Episode Date: August 20, 2024

From Ramsey Network, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm Ramsey personality, George Campbell, joined by my good friend, some would say best friend, Dr. John Deloney, best-selling author and host of the very popular Dr. John Deloney Show. And we are here for you to help you take the right next step for your life, your relationships, your mental health, your money.

So give us a call at 888-825-5225 and we will try to do just that. Joe is going to kick us off in Tampa, Florida this hour. What's going on, Joe? Hey, what's up, guys? How y'all doing? Doing well. How are you?

Not too bad. So I got some frustrating stuff going on, unfortunately. So in the spring of 2020, met the love of my life. She was finishing up college in a master's program. She had about a year left. And what happened was some life stuff happened, COVID happened. We kind of fell in love. I knew I was going to be a single income family once we got married. So I was like, it's time to withdraw. So she withdraw from the university online master's program. And at the end of 2020, she found out that she was charged, charged for the classes. And she's like, I booked my advisor, sent the information in and they confirmed, yeah, this advisor

left. So we're still charging you, basically, is what happened. We sent them all the paperwork. Here we went through, never heard from the university, never heard from the professors. So it kind of went cold for like a couple years. So the end of 2022, what happened was we got something from collections. It kind of went quiet. And they said, you still owe us seven grand. We're like, we never took classes.

There was never a product, never a university professor reached out to us. Nobody told us a thing, right? So we got all the emails, all the communication with the advisors. And for some reason, this large university is still coming at us for this money. We're like, we never took classes. We withdrew. We got all this information. So then now, two years later, we get a second collection.

So my wife, we're debt-free. Life's great. And we have this $8, dollar check for something that we never she never did never was a part of and it doesn't really make sense and not only that it's really frustrating because she was a straight-a student in her undergrad they've held her transcripts she can't even look at her class records anymore she can never get a job with the degree almost improve it and they've like froze all of her accounts. Okay. So really what I'm asking you guys is I don't know in a legal way what to do in a circumstance like this. I'm in Florida, the university's in Pennsylvania. And obviously this

is pretty stressful. And my wife, who's worked really hard with me to get that free. So I don't know if you guys have any advice on where to go and how to kind of get this to just end. Well, good thing you called two attorneys at law at the Ramsey show. So, hey, Joe, here's the first place I would start. And I spent 20 years almost in university systems, okay? I know they can be a maze. And I can't count, I would say in the hundreds, the number of students who registered for classes at some point withdrew, but withdrew past the withdrawal date. Meaning the gift the university gave you was not to give you all Fs, but you bought a seat or your wife bought a seat on the bus

that they couldn't sell to somebody else. Now, this doesn't always scale in online classes, but just go with me here. There's a deadline to withdraw. We let you withdraw, but once you bought a seat past the withdrawal date, and usually in the university system, it's a graduated. So like one weekend, you get charged this much for the class two weeks through and you get to pay for the whole class and i would start there and you can't say i didn't get a product and you bought a seat just because you didn't get on the plane that's fine but they couldn't sell that plane that's plain seat to somebody else so they they're holding you responsible for the cost i would check the withdrawal dates first if you have a if you have the withdrawal paperwork and you have the catalog and the

calendar from when this from when the the because those things change every year then all i would do is send it to the registrar i've never met a registrar who likes to steal money from ex-students. I've never met that person. Okay. It almost always is a, hey, here's a deadline. And by the way, in a graduate class, professors treat you like grown

adults. They don't always chase you down. They don't baby you. Like, you want to drop out of the class, drop out of the class. I got other stuff I got to do. But I would go look at those dates before you get indignant. And if you find out they are ripping you off, then call the registrar's office and say, I just received a note from collections.

I need to know who to talk to about it. Gotcha. All right. Sounds good. That's good advice. That's where I'll start then. My thing is, every experience I've had in collegiate is there's at least one bit of communication, just like one, like, welcome to class. There's your online class. All of her undergrad was online, and she had taken online masters. So when she got that bill, she was like, I never received any communication from the university at all, that I was even actively, even on the bus.

You know what I mean? That I was even, there was even a seat for my name on the bus. You know, so that's like right there. I'm like, how can you still kick it down? In a very strange way. This isn't Deloney story time hour, but I registered for a class and I totally forgot. I registered for a class at the beginning of a spring semester for the summer.

I think it was summer two session. I completely forgot about it. In the fall, I went to register. I had an F on my transcript, graduate school. I went and met with a professor and she's like, I'm not taking the F off. You didn't show up for my class. And the class, I couldn't show up for my class and i the class i couldn't have another student here so in order to make up the f i had to go retake like that was on

me man i forgot about it i did it seven months before but that was a hundred percent on me i just had to take i had to say i'm hey i'm at your mercy will you help me out here um but but the other here's the other thing a lot of schools have switched to portals kind of like doctor's offices have. They don't email you 500 times. They don't baby you. They say your responsibility is to check your portal every day. Here's the meta here.

Take full ownership of this and get yourself out of a victim position until you have proof beyond a reasonable doubt that you are indeed a victim here. Assume that a giant institution isn't out trying to destroy you, that they have just computer processes. And I guarantee you this was a computer wipe off, send you to collections. There's not one person in the room going, ha ha.

It's, it's just, you know what I mean? So get rid of the villain and the bad guy and the victim. Let's check the dates. And if y'all didn't register i mean if y'all register for a class and you didn't pay for it just own it and pay your eight thousand bucks and move on or call and beg for mercy say we totally blew it totally blew it

during 2020 life fell apart can we come to a settlement here right i mean that's what i would that's what i would do but take ownership of this thing um until you find out man if you're getting hosed and they're just like yeah doomed we're trying to get some extra money well then yeah then hire an attorney and go down that road um because they've falsely sent you to collections but man i've just been in a lot of these conversations george where injustice injustice injustice it's like hey you're rich for class you just never showed up oh my bad oh yeah i'd be filing an appeal with the registrar's office. You can try to send a dispute letter to the collections

and just go, hey, this was a big misunderstanding. What's it going to take to clean it up? Before you do that, go take full responsibility and say, is there a chance that I'm at fault here? I registered for Kalash and I didn't show up for it. And if it is, then call and beg for mercy. That's different than, you screwed me! Vengeance! That's right.

Sorry this happened to you, Joe. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Open phones at 888-825-5225. Well, John, we just announced the brand new 2025 Ramsey Gold Planner. It's officially on pre-sale. And I love this because you talk about how we've gone digital with everything. And sometimes we need to go tactile and analog. Well, and yeah, like my wife used the same

type of like old school writes in it every morning planner. And I'm an old, you know, that too. We talk about this off air all the time um well if it's digital john has lost track i'm out i still like holding it and writing in uh the calendar and this ramsey goal planners it's it's a perennial seller it always sells out um but this year is a little bit different we understand that everything's tight like everything's just tight in people's homes financially and so we're doing something different we're rolling it out early we're pre-selling it this year and by pre-selling it we can offer it at a much lower price and so this is the best price that's ever going to exist $35.97 if you buy this planner for your wife your husband if you buy this planner if you use this

planner and you buy it every year i can't tell you enough buy it now. It's the best price that's going to be on it, and it's going to help you with your money, your faith, your relationships. I've got some writing in it. Jade's got some writing in it. Rachel Cruz has some writing in it. And, of course, there's the calendar, which is probably arguably the most important part of the planner that is the calendar part.

But it sells out every year. Get it now. Pre-order it. And it just is another thing you can mark off your Christmas list, and it's just $ it's $36. So go to RamseySolutions.com slash store, or you can click the link in the description if you're listening on YouTube or on the podcast. Easy.

But it's an easy way to grab it. Go get it. Last day to pre-order, September 2nd. Plus it looks rad. It's got these little gold, I don't know. They didn't ask me. I would love to see you try to explain the design work on this yeah it'd be embarrassing it's got these rings that are cool it holds it together

it's beautiful spirals it's got numbers in it calendar goals now it also has books i'm reading which is a thing you don't do george that's cool that's not true maybe you should get this i'm actually i'm going through an audiobook right now i'm really enjoying it's a memoir that's what i'm into right now my thing. All right, let's get to the phone lines. Mike is in Houston. You don't even know what that word means. What's up, Mike, Mike, Mike, Mike, Mike, Mike in Houston. What's going on? How are y'all doing today? Big fan. We're doing well. Keep us on the track, man. How can we help you? Well, I'm just to make it quick. I'm basically 33. I'm moving into Houston to get a better job and make more money. However, going through my debt, I'm trying to attract the credit cards that I have.

So thinking about my vehicle, I owe $16,000 on it, and it's worth about $11,000. So would it be better to just give it back to the bank and just tell them I can't afford it? Or should I just use the $10,000 that I have right now that I'll be using to secure my moving and pay the difference and just sell it? I would definitely not do a voluntary repo. Like you first mentioned, I would much rather see you come up with the difference, even if you had to go down to your local credit union and get a $5,000 loan for the difference. But good news, you have it in cash. And so I would use that difference. If you owe $16, it's worth $11, you have $5,000, you show up with the buyer to the lender's office and go, all right, I need the clean title.

Boom, you pay it down with the check that they give you. You have your cash to cover the difference and it's over. And I would sell a private party and try to get the most you can out of this vehicle versus trading it into some dealership. Okay. I agree with that. I might maybe get more if I, I mean, that's, that's what I saw online. You know, that's about, but you know, the dealership will probably even go lower than that. Oh yeah. They're going to give you nothing for that. They'll go, well, I'll give you six grand for a car that's worth 11 because they need to make some money too. Okay. So that's what I would do in your shoes. What's your income right now? Well, I was kind of in South Texas and my income used to be 32, but the job that I just got, I'll be getting about 65. Wonderful. So you just got the job, and you're going to move to Houston soon?

Yes. Do they include any relocation packages, any money to help you with this move? No, unfortunately. And where I used to stay, basically, I did not pay rent. I owned a place, but I went ahead and sold it to just go ahead and get the new job because i've been here for about two years and a half and i couldn't really get any more income but just side hustle so i decided to just take another job to double my income and also possibly making

commission plus bonus good for you excellent plus you get to root for the astros which is it's just amazing arguably the best part. Easily the best part. Okay. Well, so I think I will just go ahead and push myself and pay the difference and try to settle here within this month on a private party. Yeah. And then limit how much it's going to cost to move. How soon is the move? Is it a month from now? No, it's actually in the next two weeks. Next two weeks. Okay. So I'd scrape together any money you can. Do you need a car in the meantime?

How are you going to move? Well, I'm using the truck that I have right now to basically move. But I'm thinking, you know, after I sell it, I'm just going to give me something cheap for like $2,500 and just, you know, drive it for two years until I save up and pay everything that I need to pay first and then worry about the car later. You are thinking correctly, my friend. That is awesome. I love this plan and it's not going to be a nice car. It's going to be a beater,

but you make sure you get a good inspection on it so there's no major issues. If you buy something for three or four grand, you'll be able to upgrade probably within a year if you have no other debt to where you can then have a $6,000 car, an $8,000 car. And that's what John and I have done for years, and it's the best way. I never think you should drive your nicest car at a young age. That ruins you. When I see 16-year-olds driving brand-new cars, it just hurts my soul. Yeah, man.

Mostly out of jealousy. Like, my car, you don't even know how to keep it driving for three seconds. You're going to crash that thing. Plus, I just like to, I just like to go back to 1984 every once in a while. 82.

Any car still on the road today is, is a Taj Mahal. It's like a Porsche compared to what people were, like, just, we're fine.

Everybody's fine. We're so dramatic about our cars. Oh, gosh. Now it's the leather's not nice enough or the well it's like iphones i look you know when the iphone 8 came out like this is the most amazing phone now i see an iphone 8 i'm like oh my gosh what a relic of the past that is and the iphone

one was like uh it's like a spaceship and we're like oh gosh are you poor like god get over yourselves people yeah if it gets you from a to z's fine. We sound like old guys, John. It's not good. All right, Caitlin's up next in St. Paul. What's happening, Caitlin? Hi, guys. So, you guys are great. I've kind of followed everything.

We have, like, our emergency savings. We have life insurance. We have one child. We have a savings account for him. I have my retirement at 15%. And now I'm just trying to look at like paying off our big mortgage in a faster way. So I went to our credit union to kind of do bi-weekly payments instead of monthly. So we're paying more interest down faster and then trying to look at making extra payments as well. But they're telling me that

they won't let me do biweekly payments, that basically what they'll do is they'll put it into a savings account and they'll still only pay my payment monthly. Can they technically do that? They can do whatever they want. They make the rules for how the payments work on the mortgage. But here's the good news. The whole idea of paying biweekly to save some interest, you can do the same thing yourself once a month with your normal payment. Just add extra to the principal. Okay. And so that's a simple way. When you actually do the math, you're just paying an extra payment a year kind of accidentally. Okay. Because of how the weeks versus months go. Yeah. So however much it was in each check,

just go, all right, we're going to double that and do that once a month on the principal, on a normal payment. That's how I paid off my mortgage early. If the mortgage is $2,000 and you want to put an extra $1,000, put an extra $1,000 with that principal. Just make sure you designate it, this is for principal. Otherwise, if you don't designate it, they'll often roll it into prepay interest. Prepay interest. Okay, so principal only. Yes.

And you can usually, I don't know how your credit union works, you can do that online. But if you're there in person, just say, hey, I want to auto pay an extra thousand toward the principal every single month along with my normal payment. And they should be able to do that, no problem. Never pay a fee for any of this. Okay, sounds great. Thank you guys so much. Awesome. Way to go, Caitlin. She's calling.

She's like, I got the emergency fund. I got the life insurance. I'm investing 15%, which is, that's the steps, John. There's an order to the madness. Baby step one, $1,000 starter emergency fund. Baby step two, knocking out consumer debt. Baby step three, three to six months expenses in an emergency fund. Baby step four, 15%. Then you start to do these simultaneously. Well, hey, I'm a huge TikTok fan, as you know. Huge, huge TikTok fan. I don't even know how long again.

But I've heard that over and over that you want to pay. There's some secret mortgage hack to paying every two weeks. That's not right. Well, here's the thing. You pay 26 payments, right? Which is 13 months worth instead of 12. So you're just paying an extra payment. That's it. Oh, man.

So instead of 12 payments, you're doing 26 payments. That really turned out to 13 whole payments so just pay extra once a month that's it guys that's it ruined my tiktok dreams life hack over hey george camel here with a not so fun fact every american social security number including our children's has been hacked and is now on the dark web and this is not a scare tactic this isn't fear-mongering it's a reality that could turn into a nightmare for a lot of people. And believe me, I've been a victim of identity theft and I would prefer it never happen again. Because once the bad guys have your social, it's the lifeblood for all of their activity. Think of all the places

you use your social. Your banking, your employer, government offices, utilities, cell phone companies, everywhere. And once they've got it, thieves can open new accounts, drain existing ones, steal payroll, and wreak havoc all in your name. Not cool. And to be real, it's not a matter of if, but when. So you've got to protect yourself with Zander's ID theft protection. Zander has all the cyber tools to help, including home title monitoring, full recovery services if you do become a victim, and stolen funds protection. Not to mention, it's the best value on the market. They've been protecting my family for over a decade, and I trust them to protect yours too. So get enrolled today by calling 800-356-4282 or just visit Zander.com. That's Z-A-N-D-E-R.com.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Open phones at 888-825-5225. Ava joins us up next in San Jose. Ava, welcome to The Ramsey Show. Hi, thank you. I am such a huge fan of Dr. John and you. This is amazing.

That's so kind. Can you clear something up for us, Ava? Who are you a bigger fan of? Just kidding. Don't answer that. All right, go ahead. What's up? Okay, that's a tough one. What's up? What's up? So I am a newlywed in the Bay Area of California, and we make a pretty decent income, but the housing prices out here are insane. So I want some advice on how we can best save for houses when everything is upwards of $900,000.

Okay. You get to choose your own adventure. Do you want George and I to make up a pretty amazing story about what y'all could do? Or do you want us to tell you the truth? You get to pick. I think I need the truth.

We can make up great stories. We're pretty good at it. Okay, go for it. It's the government's fault. I don't know. I was just trying. I'm not good at it. So the worst thing

you're going to run up against and George is going to walk you through it. Math doesn't care how in love you are. It doesn't care what the prices are. It doesn't care about anything it's

just math the question you have to decide a question that you have to answer is how unsafe and at risk do i want to put me and my new marriage and my new family in the in the pursuit of this thing that everyone has told me I have to have in order to be complete. That's the bigger question. Okay. How old are you two? We're 23. Okay.

The last I checked in the Constitution, there's no law that says 23-year-old newlyweds are entitled to a home in California. They must be homeowners by 25 or else their life is over. You're the worst failure. It's not in there. How much do you make? How much do you make? Gross, $140,000. Together?

Together, yeah. Okay, cool. So what are you taking home every month? About $8,000 net. That's after insurance, 401K, all thatk all that and you guys are just getting started in your careers yeah yeah I just started in February so let's paint a broader picture instead of I can't buy a house in California today and go okay let's make a goal that three years from now five years from now if we want to stay in California this is where our careers and family holds us

we want to be able to purchase a home this This opens your options. You go, okay, a home, that could mean it could be further out, might be a townhome, might be a condo. We just want to get our foot in the door of the real estate market and do it in a smart way. How much would we need to save up? Well, you might need to save up two or 300 grand if your income stays the same, but that's barring other things happening, like your income going up significantly. And so that kind of helps me go, okay, what are the facts? So the emotions are,

oh my gosh, I'll never own a home. The American dream is dead. Or we make so much money. We've worked so hard. How do we make 140,000? We can't even buy a house. I hate everyone. The whole system's against us.

Let's burn it all to the ground. Like there's so much spent energy there that accomplishes nothing for your goal, which is what you and your husband want to have a house, right? Yeah. Yeah, definitely. Our goal is to have something better than what we're in when we want to have kids. Amazing. And you guys commute to work currently? I work from home most of the time. My husband commutes about an hour a day. Okay. And is that because where he works is an insane area to live? Yeah, it just isn't feasible. I mean, it's closer to San Francisco. We live south of that and we have super cheap rent. So we're just not willing to leave that and spend $4,000 for something equivalent. It just doesn't make sense at

this point. What do you do for a living? I'm an M&A analyst at an accounting firm, and my husband is an assistant project manager for underground construction. Can I tell you something bananas? Go for it. I believe with all my guts that you could move to Dallas, Texas or Austin, Texas or Nashville, Tennessee Tennessee and both of y'all could find $70,000 a year jobs. You know, it's funny you say that because I can keep my California pay and move to Dallas. I just picked those cities randomly just because I'm from Texas and I live in Tennessee, but here's the thing. It's also where people are actually going when they leave california yeah that is that's a huge in that in florida but as george was saying you guys want to ask yourselves in three years what kind of life do we want to have and i want you to throw in another

variable which is geography and if you can bend on one of those variables then there's suddenly a path emerges where people get stuck and enraged and angry they want everything all right now i went all the way exactly the way i want it and i refuse to bend and so i'm going to burn all of your world down because i'm not getting my way versus no we want to have this size house so that we can have a family okay can we do that in dallas or we want to live in california because that's where all our friends and family are. Okay, it's going to cost us. So we might have a condo,

which by the way, you can raise an amazing family in a condo, right? Or we're going to rent. Like it just allows you some freedom. It opens up, I love the way George, the way you said that, it just, it opens up your mind. It lets you step back a little bit

from the current to, okay. And at 28 years old, what do we want our world to feel like and look like? Let's do the best we can to get there. Okay. Yeah, that makes sense. Do you guys have any debt? No. So we just paid off my car in May and that was our only debt. So we're all good there. Amazing. And you're starting to build up some savings? Yeah, we have about $25,000 in a high yield. That's great. So let's call that your emergency fund. And so now we're on to baby step 3B, which is this down payment land. And so the question becomes, how much can we save? How

aggressively do we want to save? And like John said, is this where we actually want to stay put? Should we be searching in this area? Or do we need to search outside of here? Is it worth moving? Because to live in an ultra high cost of living area, which is where you guys are at, you kind of need an ultra high income to match that. And so if you're going to work near San Francisco, yes, you might need to make 200 grand or more just to survive out there if you want to live right there. And I don't know about you, I don't want a long-term hour each way commute because that's going to eat up your life. Right.

And so I think we just need to look further out. We need to move. Yeah. Our goal is either to move closer to San Francisco and one of the surrounding areas that's a little cheaper, or we're seriously considering Dallas because I could keep my job. Okay. Well, that's fantastic. And so the other thing that I think a lot of 23-year-old couples

make, 24, 25-year-old couples is any one decision we make is our future forever and ever. Amen. Right. And George and I both are in job, what, six, seven, eight since we were 23, live in different places. I'm in a different state. I think George is different. It's just hard to project where you're going to be when you're 40. So we're going to make the next right move always knowing the coolest thing about our life is we get to choose what happens next.

We can change this. That's actually a really good perspective. It feels like we've been moving at a million miles per hour the past year being married and trying to figure it all out. There you go. All you have to figure out right now is what's the next right move. And the next right move is cool. Let's start saving for a house because we both know that. We don't know where it's going to be, but we're making good money. We can both just start saving up for it. Yeah. Yeah. That's a good perspective. And by the way, all this energy is going to be there.

All the energy. And you can channel it into rage. You can channel it into how dare they. You can channel it into entitlement. Or you can channel it into, all right, I'm just going to do the next right thing. But that energy has got to go somewhere. And, man, I love people choosing, all right, I'm going to go be proactive about this. And I'm going to go make it happen.

And by the way, George, can we call this out? Have you ever been to San Francisco area? Yeah. It's stunning. It's beautiful. The weather is just perfect. The weather in Malibu, perfect. I get why everybody wants to live there.

It's easy to bag on it like, oh, it's crazy. Who would want to live there? It's amazing. And it comes at a significant cost. It's just both are true, right? It's like driving around in Rachel Cruises' Tesla versus your Tesla. Very different experiences.

One's amazing and one is a Tesla. I was like, somehow John's going to make this a dig at me. And he did it. It was a success. I can't even hate on that. Ava and anyone else listening who wants some resources on this, our team created a real estate hub. It's totally free.

Lots of tools and resources for those preparing to buy, wanting to buy right now, home selling, even real estate investments. And tons of great tools as well. Totally free if you want to find an agent. You want to use our home buying calculators, home payoff calculators. It's all there. Just go to RamseySolutions.com slash real estate. We'll also drop a link to that in the show notes and we created this to be a resource for you to help you during these crazy real estate times to parse through all the noise what's actually true to help you get to that

goal this is the ramsey show there's a time in your life and did the baby steps for renting but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget because it always goes up, never down. So when you're ready to buy, make sure you work with a mortgage partner you can rely on, Churchill Mortgage. Churchill is Ramsey-trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy a home the Ramsey way, your mortgage payment will be a consistent, manageable part of your monthly budget. Plus, when your home is paid off, that was your largest expense. Now it's extra money in your

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Brentwood, Tennessee 37027. hit the subscribe button, hit the follow button, leave a review, text a link to a friend, let them know about the show or your favorite clip, a highlight, anything that can get the word out because you guys truly are the best marketing tool we have to keep spreading hope in a world filled with a lot of noise and distractions and hopelessness. And so we try to displace all of that with shows like this, and we appreciate all of your help getting the word out. Lester is up next in Dallas, Texas. How can we help you, Lester? Hi there. I was calling to see about some advice on how to talk with my wife about saving more than spending. My wife's a spender. I'm a saver. We're aligned on our goals, but she

just spends a lot of things here and there. And so just some advice on that. Was there like a spit shake on, hey, here's how much we're going to spend. Here's what the budget says. Stick to it. Yeah, we've budgeted out a lot of different things. We even have a split to where we have our own fund money, where it's like a hundred bucks a month that we can spend it on whatever we'd like. But there's a lot of gifts and celebrations and things like that that my wife wants to make sure we're showing love to our friends and family. And then just things add up very quickly and then things are gone. Is this a communication challenge or is your wife being spiteful?

Because there's two different ways to approach this. I don't think it's either. My wife and I communicate very, very well and frequently about it, and I don't think she's being very spiteful at all. She agrees that we need to be saving and we want the things we want, where a house and being able to retire as both of our families aren't in that basket at all and don't have a retirement even in their fifties and sixties. Um, and we don't want to do that, but she just kind of forgets about the things and it doesn't think about the $20 here or $20 there, a hundred bucks here.

And it just kind of adds up. And so if there's anything that we can do to try, try something different, cause we've tried like different cards that only have a certain amount of money on it each month to help limit that. But obviously I don't want her stranded. So she has access to a card that, um, is, has access to the main, main fund for gas and all that kind of stuff. But are you guys only using debit cards or are there some credit cards still being used? No, no, no. We only have debit cards.

I hate credit. I always have. But yeah, we only use debit cards. Most, I don't mean to overly gender this, but this is just the way it plays out in the real world. Most of the time when I talk to men in your situation, they try to solve this with a plan, a strategy, a new card, a new spreadsheet, a new commitment ceremony. And the only way I've ever seen somebody be successful

is if they are honest with their spouse about the story behind the story, the story behind the strategy. And that would be you sitting down and saying, I need to be open with you. Can I tell you something that's scaring me to death? And her say, oh, sure, honey, what's going on? And you say, I'm scared about not having any money. And I'm feeling like um

I'm not communicating this well because every month there's another 250 dollars in gifts and stuff like that in 20 increments and I don't feel like I'm I'm I'm I'm being fully honest here at the table and you notice I did two things here number one I, I was honest. I told you, told her how you felt. You didn't throw a strategy at her. And number two, you use the word I, not you keep overspending and you keep doing it because when she does that, man, she's going to go back to her childhood. She's going to go to war.

Yeah. My guess is she's going to have to decide. I would rather feel the short-term discomfort of not having a gift for every single thing that pops up because I never could buy gifts for anybody or I never got any gifts for anybody and now I can so I feel like I have to she's got to give up that short-term pleasure for the long-term safety of me and my husband don't have to worry about not having anything to eat and that's hard and I haven't seen a way to get there without emotion

without without a story without you saying this is how I feel And that's hard. And I haven't seen a way to get there without emotion, without a story, without you saying, this is how I feel. Yeah. And if she looks at you and says, I don't care how you feel, I'm buying gifts for this thing, well, now y'all got a deeper issue y'all got to deal with. Yeah. Can you do that?

Yeah, most definitely. The other side of this, Lester, when it comes to the tactical, is that you should be sitting down with her before the month begins going, hey, what's happening this month? A birthday should not be a surprise. We know when the birthdays are happening. Christmas happens on December 25th every year. I check my calendar, still happening. And so you kind of know what's coming up and you adjust the budget accordingly. So if we need to add a gift line item in the budget, let's do that. If we need to add a miscellaneous sort of little catch-all of $50 or $100, let's do that so it doesn't derail our plans. Well, that's often really important because that's when the $20 plus $20 plus $50 turns into $310.

And she goes, oh, gosh, how do I do that? Yeah. And the other thing is we check the budget before we make the purchase. So if we go to the gift and we go, oh gosh, I wish we're going to have to do a handmade gift. Let's make a little basket. Let's get some roses from the garden. George made me a basket once.

John still has it. He loves it. It was a great gift. So Lester, that's where we come up with a solution together and have the conversation. But there is a part of this that's on her as far as accountability going, you need to check the budget before you make the purchase. That's how I do it. That's how you do it. We can't just hope that we lined up with the budget perfectly. We use that

as our guiding kind of North Star. And I think when you do that, you start to add in these line items. It starts to be less and less of a surprise. You get to kind of align it a little more. And on top of that, what is your next goal? What is the thing you guys both agreed to is the next thing that we're saving up for? Well, it's not necessarily saving up for. It's like being able to pay off our debts. So you're in baby step two. Correct.

So even more in baby step two, there's even more intentional sacrifice and intensity here where it's going. We can't afford to buy people gifts. We got to put our own mask on first. We're broke. And think about how many gifts we can buy people once we're debt-free with an emergency fund, we're preparing for our future, then we can look up for opportunities to give and be generous. And so I think that's part of it is you need to have a plan together going, we're going to pay off $700 a month of debt, and here's how we're going to do it. Versus, we really need to save more, really got to get rid of this debt. We need to get more specific so we can actually hit the target.

Lester, have you tried any of these things we're throwing at you? Does it all sound crazy? No, no, no, no, no. Yeah, and these are conversations we've had, but I agree. I haven't been very specific with it. My wife and I are blessed to be in the positions that we're in. I mean, I'm making more money than I ever thought I would before. And it, it's not been specific of, Hey,

we're going to spend X amount of dollars on our debt every single month because we have to, um, it's just been, we want to spend more on our debts. Um, and realistically we don't have a lot of debt, even student loans and medical debt and things like that included. We don't have a lot. And so within a year, we could easily have 80% of it paid off. Put that plan in front of her. Put that plan in front of her and you'll talk through it.

And then more importantly than that plan in front of her. Put that plan in front of her and y'all talk through it. And then more importantly than that plan, paint a picture for her of how you're going to be able to breathe in your own home. How you and her are going to have something neither of y'all have ever had, which is economic security. Let her just absorb that and feel her husband radiating this thing that you've probably never radiated before, which is just peace. Man, there's not a lot of gifts I'm going to buy in exchange for my wife's peace, for my peace.

You see what I'm saying? Yeah. And then, by the way, once you get that peace, like George said, you don't owe anybody any money. You can buy gifts for everybody. You could be kind of over the top and reckless with who you buy gifts for because you don't owe anybody any money. You can buy gifts for everybody. You could be kind of over the top and reckless with who you buy gifts for because you don't owe anybody any money. So this little plan, this one-year thing we're after,

this is just part of reverse engineering the picture you painted her. So instead of we got to get on a budget, you got to spend less, it becomes, hey, remember, that's what we're aiming for. This is a little blip on that timeline of intentionality and sacrifice. Are you with me? Yeah. And I hope that helps. We're going to gift you every dollar premium, Lester. What are you using right now for a budget when you guys sit down together? A pen and paper. And then I use an Excel sheet and that's kind of it. Yeah, if you show a spender an Excel sheet, they implode inside.

They die inside. They just die. So we're going to gift you every dollar premium. It's much easier to look at, easier to use. You both log in. You both have accountability. So while she's out, she can actually check the budget versus Lester's spreadsheet at home. So hope that helps, Lester. We're wishing you the best as you attack this debt. That puts

this hour of the Ramsey Show in the books. Thank you to Dr. John Deloney, all the folks in the booth keeping the show afloat, and you, America, will be back before you know it. From Ramsey Network, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships.

I'm George Campbell, joined this hour by Dr. John Deloney, best bestselling author and host of The Dr. John Deloney Show. Open phones at 888-825-5225. You call in and we'll do our best to help you take the right next step for your life and your money. Stav is going to kick us off in Toronto. What's going on, Stav? Hi there. How are you guys? Doing well.

How can we help? Good. So I'm guys? Doing well. How can we help? Good. So I'm a 22 years old. I have $200,000 in savings and I actually got accepted into law school a month ago. Now I'm considering taking a student loan. No, no, no. Don't do that. So that's my question is what do I do?

Do I pay for school outright? Yes. Forget about everything. Come out of school with, school's going to be $120,000. So come out, I think it's like $80,000 left in my bank account or take a 0% interest student loan because right now I'm getting percentage on the money that I have. No, no, no, no, no, no, no, no, no.

Here's why. I was a dean of students at a law school. I've worked with young, young attorneys in training as they transitioned out. And the number of students who had a vision of who they wanted to serve and who they wanted to help and who they wanted to go to war on behalf of got put in the trunk of a car because they had to go take the job that paid them the most money regardless of how toxic, how madhouse the culture was.

Right. And I watched it. It ate people alive. I want you to leave law school with 80 grand in the bank. No debt. You don't owe anybody anything, and you are armed with one of the most powerful credentials known to man, which is a North American JD. Right.

A Juris Doctorate. You know what you can do? Anything. You can go serve the least of these. You can go work at a corporation. You can go be an executive. You can go be a member of the, I don't know if you're going to be, are you going to school in Canada or in the States? I'm going to Canada. I'm going to law school in the

UK actually. Oh, UK. Okay. So what are you going to do with that with a UK law school credential? Well, I'm looking to either come back to Canada or come back to America and work there. But what? I'm going to be working with either or. So when you come back, when you go to law school in the UK, you have to do a test either in Canada or the UK, and then you can start working in either country. Okay. But then if you came to work in the States, you'd have to take whatever state's bar exam that you wanted to take, right?

Correct. Correct. Is the barrister's exam in the UK the same as it is in Canada? It is the exact same. Oh, wow. It's more similar in the UK and in Canada. There's certain things that I'll have to study for the States, but it shouldn't be a problem at all. Okay. And what job would you get

right now? And by the way, it's going to change almost always changes, but what job do you think you're going to get? You know what? I've been thinking about it and I'm looking to potentially do tax law or corporate law going to that section. But you know what? I used to think that I wanted to do family and then people are like, don't get into family. It's way too messy. And then I was thinking of potentially doing construction law and going into that. But you know what? I'm not sure yet. So I'm going to start law school, see what pulls me in and then I'll go that route. Okay. If your heart tells you to go sit with hurting families and help take care of people in their most vulnerable moments, man, do that. Okay. If your heart tells you to go sit with hurting families and help take care of people

in their most vulnerable moments, man, do that. Yeah, it's messy and it will tear pieces of your soul and it's also good and right. So yeah, whatever you're going to do. The only thing I would challenge you on is to really consider

why the UK, unless you're going to live and practice in the UK. Right. I understand. Because it could be a cool time to go study law and you can go over there. It's just different.

You're going to lose out on the networking opportunities on the local areas to getting plugged in and local places and local systems. You just lose all that when you go overseas. But it is what it is, dude. But just don't borrow money. Don't come out owing. Um, cause man, that can make, that can, that can, you can end up sideways real, real fast. Right. Yeah. I understand. And that was definitely one of the factors that I took that

the networking is not going to be the same, but I know myself, I love talking to people and like, um, what I'm going to do is find a job in the UK that also has a firm either in the U S or Canada. So that way I'll be able to transfer over. Um, but also I've never really traveled Europe. what I'm going to do is find a job in the UK that also has a firm either in the US or Canada. So that way I'll be able to transfer over. But also I've never really traveled Europe. And so I want to take the opportunity that now that I have the money and I'm young to also travel while being in law school. You don't know what law school is about, do you? I do, but hopefully I could take a Friday or Saturday and go somewhere close. I would recommend, dude, if that's the case,

I'd recommend you defer for a year and go travel. Use some of the money and go travel. Law school is going to take your soul. It's just hard, man. It's all in. Right. It's all in. Right. Absolutely.

But you do what you're going to do. But, man, if you want to go tour Europe, go tour Europe. You've got $200,000 in the bank. Go do that. If you want to go to law school, go to law school. Trying to combine both is going to be really, it's a recipe for being pretty disappointed. Right. What were you saving the 200 for, Stav?

I'm curious. What was this kind of earmarked for? It's always been something that I didn't know. I'm really good at saving and I worked at tech sales and I've just always been putting money aside. I've looked at the way my family is and I'm like, they've moved to countries and I really wanted to set myself up for success. So I've just always put money in savings. I probably saved all my tech sales income, probably 90% of it. So you saved up 200200,000 on your own?

So it was, I got $120,000 by myself, and then it was $80,000 from a motor vehicle accident settlement. Okay. That's impressive, man. $120,000 on your own at 22. That's very difficult to do. So good on you for doing that. That kind of resourcefulness is what's going to get you through. Thank you.

I worked a lot during university. That's why I'm hoping i'm hoping that potentially i won't be working in law school but maybe i could take two days or something and go see amsterdam or go see or take three weeks before you start and go travel yeah i'm doing that as well okay i'm actually leaving in a week wonderful well have a good time congratulations and uh what a way to tell people, hey, I'm 22 and I saved up 120 grand. What are you doing? Because a lot of people, John, they go, well, I just have to take out a loan, John. I just decided yesterday to go to law school and it's going to be 300 grand and we don't have that money. So I expensive degree and you still have a debt to show for it. That's the catastrophic is when students are worse off having interacted with the university and that's when they leave and they don't get the degree but they leave with one semester, two years of school. The lender doesn't care if you graduate or not. You owe. You can't discharge it. You owe. You're paying. And if you can't pay, we'll take it from you. Yeah. We saw those stories in our documentary called Borrowed Future

where a bankruptcy lawyer who focuses on student loan cases was saying they want their pound of flesh. I'll never forget how she said it because it was so intense. And it's almost impossible to bankrupt on this, even through hardship. I mean, she was sharing the craziest stories of people who should qualify. Doesn't matter. And they didn't get it. They'll get it.

If you got a hundred grand in cash, pay for it, man. Oh, it's... Go to law school, do your thing, and then go on about your life. I encourage everyone to go watch the Borrowed Future documentary. It's free on our YouTube channel. It's 88 minutes. Parents watch it. Students watch it.

Parents, students watch it together. It's going to spark a conversation, number one, about how to avoid student loan debt, and number two, what the path looks like to go to college debt-free the right way, regardless of what your plans are. Woo! But you heard him say, John, I wanted to set myself up for success in the future. Well, that's what that money is then for. That's right. Success to me means freedom and options and margin when I graduate, not chains to the tune of $200,000. And so parents, please have the conversation with your kids, even if it's awkward, even if you have your own baggage and shame and guilt and money mistakes. Do not continue to let this generation go deeply into student loan debt.

Also, they go to mommy and daddy's alma mater. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever to get anything approved through the bureaucracy. So if you feel like the system is working against you, try a biblically-based alternative to

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So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget. That's chministries.org slash budget. Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. It is time for our question of the day, brought to you by YRefi. Now we don't recommend refinancing on everything, but for distressed private student loans specifically, there's YRefi. We trust them because they help you with a low fixed interest rate you couldn't get anywhere else to help you stick to your budget and get out of debt. That's the goal.

Learn more at YRefi.com slash Ramsey. That's the letter Y, R-E-F-Y dot com slash Ramsey. Might not be available in all states. Today's question comes from Brooke in Kentucky. Brooke writes, I've spent close to $600,000 on gambling over the last nine years. I regret this habit and have become very depressed. The worst part is I still gamble, but much less and now it's controlled. I mean, the money I wasted. Is there a way to put the stupidity behind me and not be angry with myself? I mean, this sort of pathological gambling and this continuing to gamble tells me Brooke has not fully metabolized the depths of all of this. And so, I mean, anything I wanted to add here would just, you gotta go to Gamblers Anonymous today

and submit to a 12-step plan. I mean, this is so much bigger than you. And it's just gonna be tough. You can't just decide, well, I'm just gonna put this stupidity behind me and not be angry. You haven't fully owned all the decisions here right in most cases john with these types of any kind of addiction really is full sobriety the the

path is there a way for someone to go well i still gamble but now it's controlled like is there a piece of you that is still out of control um i mean there's there's some actually been some movement there over the last few years in the addiction community, this idea that, like, once you admit it, you have to be sober for the rest of your life. The answer is no. And that's so individualized, and it's so person by person. And this is, I mean, this is in the alcoholic world, this is the equivalent of drinking two or three bottles of jack daniels a day for 10 years right i mean probably not if you've burned through more than half a million dollars um then probably and you're still doing it probably you're gonna have to end up at a place where you're sober right but again i i can't make that call from this for not even talking to this

person just reading their note what i know from this is, or what I believe I know from this note is, there just hasn't been a full ownership. She didn't really deal with it. And here's the other thing. Healing here will come in community with other people. It will not come from some epiphany that you have in your head by yourself. It has to happen. I decided I'm going to try to be different. It has to happen in community where somebody looks at you and says,

I see what you did and I still love you. I see what you did. I'm sad too. I'm hurt too. I'm angry too. I'm pissed off too. We're going to go build something new. And that has to happen in a group.

But I'd want to have a conversation with Brooke, but I think the most responsible thing I can tell Brooke is call a GA group right now, a Gamblers Anonymous group right now in Kentucky and go see somebody. Like right now. Right now. And for the first time in 10 years, be 100% honest. Yeah. That's wisdom.

It's a mess. Thanks for the question, Brooke. Wishing you the best. Beth is on the phone lines up next in Sacramento. How can we help, Beth? Hi, excuse me. My adult sons, they're 34 and 39, came to me with this question, and I wasn't quite sure the answer, so that's why I'm passing it to you. Their father, who I'm not married to, has taken out a reverse mortgage on his home. And they just wanted to know when something happens and he passes away or goes to home, what they're responsible with inheriting a reverse mortgage.

Okay. Well, their name's not on the mortgage, correct? Correct. Okay. So they're not going to be personally responsible. No one's going to come after them for this, but it must be paid when he passes. And that might mean from the estate, his estate's going to go through probate, the house is going to get sold before they ever get an inheritance, if there is anything left.

And so that's part of the process. So they can decide, hey, we're going to sell the house, we're going to take the proceeds, pay off the mortgage, and we share the rest. Or they decide we want to keep the house, we're going to still need to pay off this loan. That might mean they refinance and take out a new loan in their name to basically carry this loan to the future.

Oh, okay. But it needs to be repaid from that original lender. Okay. And now they, in a reverse mortgage, they don't, I was reading where they give 65, they're able to get 65% of the equity out of it. The person, their father was able to get 65%. So is it normally completely, I don't know how to put it.

Did he take a lump sum or was this payments over time where it goes up to 65% or it's capped? Oh, that I don't know. Yeah, that I don't know. So the actual, we'll need to find out what the current balance is. Is he in good health? Yes. Okay, so this could be a while. Right. I would still have a plan of

attack. I mean, the fact that he went into a reverse mortgage, which is a terrible product, tells me he's not doing well financially. Right. And so likely this is just going to eat up all the equity in his home, and he may not have much of a nest egg or estate to be inherited by the children. Right, right. And I think they had pretty much bet on that at the time when they heard that he had gotten a reverse mortgage. So they just weren't sure. Did they have, like, a limited amount of time to sell the house? He lives in a different state than they do.

So they were just wondering what kind of mess it is that they would have to clean up. I assume they'd have to go clear out a house. Yeah, if they're the heirs, there's going to be stuff to deal with. And typically, heirs would have about six to 12 months to settle their reverse mortgage. They might be able to request an extension because it's out of state. You can contact the lender for details on that. But it's not going to be a fun thing. I'd much rather leave my kids with no payments to deal with and they go, all right, here's the house, here's the keys.

And expect there to be significant additional interest, balloon interest, fees. Like I can see them in their head doing the math on, okay, 65%. So it's going to be this and this. Okay, we're going to get this much money out of it. Probably not. Okay.

So there's on the back end of this. Oh my gosh. Yes. I'm sure the lender has all kinds of fine print. Because what I, again, what I would guess a lender wants is, wants the cake and to eat it too or however you say that thing the lender wants the equity the lender wants that house when it's all said and done to sell it and the lender wants the interest that it pays on that loan or that earns off that loan and so the lender has a vested

interest in claiming the home at the end of this thing. Yes. I mean, they'd be happy to go, all right, it's going to be a foreclosure and we own it. And so that's what I don't want to happen. So they're not personally liable. If they say, hey, we want nothing to do with it. Well, the lender is going to foreclose on it. They're happy to sell, take the money. So we need to have kind of a little bit of a mess to clean up, but they already pretty much know that once the reverse mortgage was taken out that there's probably not going to be any – that was not their concern, and they just wanted to make sure that they weren't responsible for his debt. No, they're not responsible.

If they didn't co-sign on any debt – and this goes for any debt for any human. If your name is not on the debt, you're not going to be responsible okay good but they might not get any of this home at all right yeah they pretty much have figured that out already that dad is not a secret billionaire yeah right well i'm sorry you're the one dealing with it it's money plus interest plus fees right are you calling on their behalf just as a kind of worried mom? I was. Right. Well, yeah, because they had asked me the question,

and even though I knew a reverse mortgage was not a good thing, I just didn't know then what they were responsible for. How old are the sons? 34 and 39. Okay. So they've got their own families in their own homes, but they were just, you know, trying to see in the future what, you know, I think it's best for them to be prepared. Absolutely. And have a conversation with dad. Call him up and say, listen, we want to know exactly what's going on with your finances, because clearly things aren't going well and we're going to have to be cleaning up this mess. Oh, not the legacy I want to leave. That's for sure, Beth. Thanks for the call. This is The Ramsey Show.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The phone number to call is 888-825-5225. Well, John and I are hitting the high seas in March of 2025, along with thousands of our friends, the entire Ramsey crew, and a bunch of you guys. It's the ultimate debt-free celebration. We're calling it the Live Like No One Else cruise. I thought it was the cult cruise. That's part of it.

Okay. Because on all Ramsey crews, you've got to really want to be on that. There's going to be big vats of the Kool-Aid. We're all going to drink it together. Big punch bowls. That's right. Big punch bowls. Oh my goodness.

It's going to be a good time. So this is for those who are debt free. So if you're baby step four or above, meaning you don't have any consumer debt, you have the emergency fund, you're investing 15%, now is the time to celebrate. Some of y'all, it's time because you've been debt free for a while and you haven't done anything fun yet. And so we're creating something fun for you to do. We want to celebrate with you. More than 80% of the cabins are already booked Rachel, John, Ken, Jade, myself, a bunch of special guests, Stephen Curtis Chapman, Manit Chauhan, Dina Carter, one of my favorite comedians, Trey Kennedy, just announced that he'll be joining us there,

magicians, songwriters, comedians. I've heard Ken Coleman has challenged all of us to a cannonball competition in the big boat pool. Wow. I've never seen him cannonball. He's not a big guy. I can't imagine he can make a big splash. Yeah, but I think it's all technique. And if there's somebody who's just got the technique dialed in, it's Kenny Dub

Coleman. He needs the win. So I'm happy to let him have this one. He'll get the win. He'll have it. Well, you never know what's going to happen. But you have to join us to see it for yourself. So secure your spot with a $600 deposit before all the cabins are gone. RamseySolutions.com slash cruise is the place to go to book your cabin

and for more information. Can't wait. All right, Pete is in the great city of Lubbock, Texas. What's going on, Pete? Hey, guys, thanks for taking my call. How can we help? I kind of have a, I have a kind of an advice. So I've been in the oil and gas industry here in Texas for about 20 years. And, you know, during COVID, I was laid off from a job. Well, right now, I just found out that I'm going to be laid off again from another company probably next month. What field is this? Oil and gas. Okay. Still in the oil and gas field.

Still in the oil and gas, yes, sir. All right. And anyways, right now, I'm 43 years old. I'm recently divorced, but I am debt-free. My vehicle's paid off, everything. And I really don't have really much retirement, hardly anything. The only thing is, though, that this company that's going to lay me off is actually going to give me a very significant severance package.

How much? Probably after taxes, it'll probably be around $200,000. Wow, excellent. Well, that's some good news. And how much do you have in savings currently? Not your retirement, but how much do you have in a savings account? Not much, probably like $2,000. That's about it.

Okay. So during this time, I've actually been contemplating, before I even heard about this news, that I've been wanting to change career fields. I've been wanting to get into a, to be a realtor, to get my real estate license. Okay. But my question is, is that should I, would it be okay to try this new field while I get laid off and take that money? And if I try it, then that means I might have to live off of some of it until I get my feet wet, until I basically learn what I'm supposed to do. And on top of that, I was giving my ex-wife, you know, child support payments and paying for, you know, medical.

So now that my kids are going to be under her insurance, basically I'm going to have to pay for the medical insurance and still have to give her the child support money. Well, if I'm going to school to be a realtor and learning that new trade, I'm going to have to use some of that severance to kind of keep my kids afloat. Or should I just suck it up, stick with what I know and just find another job and put all that money into a mutual fund and just let that go. So anytime somebody calls me or asks me and they have distilled their next move down into two not great options i always just want to tell everybody to stop because in your mind you have said option one is suck it up stay miserable find another job out in this west texas heat and by the way i moved from lubbock i get it man it's hot you're down there in midland odessa and down there lomisa is hot man it's it's brutal like i just gonna have to do that just suck it up or i'm gonna take this literal gift from god that fell out of the sky 200 grand that i can get an emergency fund i can

begin retirement savings so my kids aren't gonna have to take care of me someday and i can go get a job a regular job that's to float me while I go get certified because I'm going to get certified at night with real estate classes online. And then I'm going to start hitting it up in that, that West Texas market. That's what I would do. I would not use this money to float you. Why? Because you're going to get, everyone's going to tell you, oh, you got to have this car. You got to pay pay for this merchandising you got to go do this and add on this and you just get that money's going to be gone i'd rather see you put that money away and have it work for you downstream and i'd rather see you go get a job a regular old job not making what you're used to making out in

the oil and gas field but go get a job job and know that all I'm doing is funding my life right now while I go work on the credentialing to go be a real estate agent. Okay. That's a third option. And you're going to have to pinch. It's going to be a totally different transition for you. You've been making good money out in the oil field? Yeah, six figures. Yeah, it's not going to be that way for a minute.

Real estate takes a lot of time to build up and get some momentum. And so it's not going to be something you just go start tomorrow and make good money. And so that's why we're saying get a different job, get the real estate thing happening part-time, and start to build up your kind of book of business, get a house closed, talk to people who have been in real estate, see what it's like in your area, make sure it's right for you. Then, as you get some traction, you can go, all right,

now it's time to go full time. Okay. Brother, I'm telling you right now, you're going to look up in 18 months and you will have no money left. And you may have closed one or two houses depending on what they do with the stock market. I mean, with interest rates in the next few months. Okay. That's not true. You might do five or 10. You're a hustler. But I would talk, do you have any real estate buddies that you can talk to who are actually in the business? I actually have a couple of people that I went to high school with that I just happened to see that they started in real estate maybe a couple years ago, and they looked like they were killing it pretty good. Yeah, the key word is look like it. Real estate agents are great with the vanity plays.

They can make it look like anything is happening. Man, they get the best pictures. They get glamour shots. They get their nails done, hair done. Everything looks great. Right. Let me ask you this. What do you think the real estate career shift is

going to give you that the oil and gas field will not freedom uh basically just the freedom to you know be with my kids whenever i want um to not have to be tied down to a monday through friday job just and also really just well what i what I do I mean it pays really good but I'm pretty much hit the ceiling and um I have financial goals that I want and I'm not going to get there with what I'm doing I mean I can make a really good living but I mean I I want more you know I want I want more freedom and I want to be able to build wealth before I'm an old 65, 70-year-old man. Okay, here's what I'm going to do. When we get off air, I've got a close, close friend who's a real estate, does really well with real estate in the 806 area code.

And I'm not going to do it on air, but I'll hook you up with her contact info and see if she can have a cup of coffee with you. Because I think your picture of what that life is like is not accurate because the real estate agents I know that build the kind of wealth that you have in your mind, they're making deals

at midnight on Saturday nights. And they're driving to show a house at nine o'clock because that's when the client could do it. That's right. They're going from Amarillo

to La Mesa on Saturdays missing games. They are working round the clock. There's a million real estate agents out in West Texas that do two houses a year. And it's supplemental income

and they go to their kids' games and really they got their license because they don't want to pay closing costs on their home purchases and they like to help out their friends and family every once in a while. That's not what you have in mind. You want to be a mogul.

You want to crush it and move it. Just the real estate folks that I know out there, man, they are always on call, always working, always hitting the next deal. It's just, it's a lot. So hang on the line here, man. I'll get your contact info and I'll reach out to you personally. Welcome back to the Ramsey Show. Open phones at 888-825-5225. I'm George Campbell here with Dr. John Deloney. Ethan's up next in Washington, D.C. What's happening, Ethan? How's it going? So I watch you guys' show all the time, and I'm a big fan. Thank you. And my question to you is, I have zero debt. I have no credit cards, nothing. And for someone who's never bought a home before,

is taking out a big loan to buy a home a good thing or a bad thing? Well, let's define big loan. What are you taking out well the the thing is is that most homes you know are 200 300 you know four hundred thousand dollars and homes go for crazy prices you know so it's not that i i've started to take out a loan it's the fact is it a good idea too well it's never a good idea the only debt that we don't yell at you for is a 15-year fixed-rate mortgage. But we still don't like it. Dave would say the 100% down plan is the best plan.

It's never going to be a blessing to take out debt. But if you are going to do it for a home specifically, if you do it on a 15-year fixed-rate mortgage where the payment is no more than a quarter of your after-tax income monthly, then it'll be a blessing and not a burden. That's the goal. And even then, the goal is to pay it off early. And so if your goal is to hang on to debt for 30 years, then that's a bad goal.

Yeah, and the thing is, I'm 19 years old. I have $20,000 saved, and I'm really trying to go about it the smartest way, and I don't want to dig myself in a grave here. And I recently started a car flipping business and I made the $20,000 in the last two weeks selling cars. And I'm just in a really complicated situation because I work for my dad and I've worked for him all my life, but I started making all this money and I don't know exactly what to do. I don't want to leave my dad high and dry, but I'm also making a lot of money doing this. I work for him all week. So my question to you is, how should I invest this $20,000? Should I spend it on a down payment for some sort of loan for some sort of housing, or should I

continue to invest it and double the money and keep buying and selling trucks and cars and making money with it? Are you living at home right now? Yes. What is the urgency to go buy a house? I am engaged, and my girlfriend is 24, and she's ready to get married, settle down, and have kids. Are you ready? Yeah.

That was a long pause my man oh hey like you seem like you're in a in a um in a sense of panic like just like take a breather for a second man but listen you had a good week my promise for you is this isn't going to happen every week of your life for the rest of your life you had a good week it was awesome and i don't want to dampen week of your life for the rest of your life. You had a good week. It was awesome. And I don't want to dampen it, but it was awesome. Good for you. It was amazing. And then what you probably found at 19 years of age, which is a blessing for you, it took most of us until we were older, is the next day you just woke up and had to brush your teeth and put on deodorant again and go about your day again.

Right? And so do you not want to work for your dad anymore? I want to work for my dad, but the issue is I'm making, I mean, triple, quadruple the amount of money. That's not true. That's not true. You did one time. If you show me over six months you're making $20,000 a week flipping cars, I would tell you to sit down with your dad and say dad it's time for me to move on because i have i have a million

dollars in the bank and i can run this whole thing with cash and so when things get real dicey economically and people stop buying used flipped cars i'm gonna be all right like dad i'm good you had a good week man yeah so you think i should take the 20 000 do you think I should take the $20,000? Do you think I should get a house with her? I think you should just slow down. If you were my brother, I would say put in a high-yield savings account, high-five yourself, take you and your girlfriend out to dinner, and then go back to work on Monday.

Relax. So right now, high-yield savings account, just keep piling up money. You have no debt? No, zero. And how much money do You have no debt? No, zero. And how much money do you have in the bank right now? 20K. 20K. Okay, let's call that your emergency fund.

So let's earmark it in a separate account, in a high-yield savings account, and say that is Ethan's emergency fund. Now, outside of that, you can begin to set up another savings account and go, this is a down payment fund for the future, and my goal is to save X number a year. Let's call it with the money you're making, let's say it was 50 grand a year. What if I could save 50 grand a year, three years from now, I have 150 grand. And maybe you're married at that point, right? Yeah. And maybe you guys rent for the first one or three years. There's no one that says you have to get a house as soon as you're married, especially at 19.

And so I would just pause, slow down, and go, what makes sense for me in the future? Well, I've got to get an engagement ring. I'm going to upgrade the car. We need to plan to cash flow the wedding. Maybe I want to go to school for some credential. Maybe she needs to go to school. Maybe she has debt that we need to pay off. So you're going to have some upcoming life goals, and I just want you to pause before jumping into a thing just because you have

a pile of money sitting there. Now, here's my next question. So my plan was my dad has a piece of property he's willing to give to me. And my plan was to take 10,000 of it, take a mobile home because I do construction as well, totally gut it, and set it up on there, and I might have 10 to 15 in it, and we can live in there. And my plan was to build my house out of pocket and go to material auctions and build materials and do things like that instead of taking out a loan to buy a house. Do you think that that will be a more viable option? I'm not a fan of mobile homes because they're a depreciating asset.

So that thing's going to go down in value versus buying a normal home is going to go up in value over time. History has shown us. Or let's reverse the life you say you want to have. Let's say you find a place to rent for a year and it's, what, $2,000 a month? You get a real nice place. I don't know where you are.

That's $24,000 a month? You get a real nice place. I don't know where you are. That's $24,000. And then you move on. Then you buy the house that you want. If you like to go to auctions and do that kind of stuff, more power to you. It's just going to take time. What about this?

What if once I build my house out of pocket, I can rent the trailer out though? Bro, you've got, listen, here's what you've got. You've got two old married guys on one side of the table, and you being a 19-year-old who just had a great week, and a 24-year-old fiance who's pressuring you to start your life faster than you're ready to start it. And so you have a choice to make. You can scramble and have this plan and buy this depreciating asset and take

this piece of land and put a double wide on it and do this and flip it and slap it up, flip it and reverse. You can do all that, dude. Or you can look at two old married guys. I got two kids. George has one. We each got a couple of dogs. And nobody can take our house from us. And nobody can take our cars from us. And we sleep obnoxiously well at night. You see what I'm saying? Yes.

I just don't want you rushing through life because it's way easier to fall flat on your face. And you're so young and so successful that it's going to be really easy to do that at the pace that you're running. And everybody will have an opinion because you're a hustler. But I want you to hear what George said because it's really important. You got $20,000. As far as George and I are concerned, you're at zero now. Now you're your own bank now you can begin saving money for a home for a truck for a piece of land for whatever to start your business because i promise you

something's gonna break you're gonna have a bad month yeah it's just life man and now you've got emergency fund millions of people in america millions are not in the financial position you've just stumbled into. I'm not even going to say stumbled, that you worked your butt off into. Yeah. Don't go below it. Just exhale. So I would wait until you're in the next phase of life where you've been married for a year or two, you've rented, you kind of got to know this person. I mean, I don't know how long you've

been dating, but at 19, I can't imagine it's been a super long time. You don't sound like you're even ready to take the next step. So I would just pause and reassess before making any money moves. Just keep making it. Keep piling it up and you'll be all right. Well, John, this show particularly is almost over. If you're on YouTube or podcast, it's about to end, but more calls are coming up in the Ramsey Network mobile app. And it's the only place to get full episodes of The Ramsey Show. And if you're wondering, if you're on radio, just stay right where you are. The show will continue as usual. And there's two ways to get the free app. If you want to continue listening for

those on YouTube or podcasts, click the link in the show notes or search Ramsey Network in the App Store or Google Play. And the team is continually working to make this app even better every single day. So don't miss what's coming up next. Go watch the full show in the Ramsey Network app for free. That puts this hour of The Ramsey Show in the books. Thank you to Dr. John, all the folks in the booth, and you, America, will be back before you know it. From Ramsey Network, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by bestselling author Dr. John Deloney, and we are here for you,

taking your calls about life, money, mental health, relationships, everything in between at this number, 888-825-5225. Trevor's going to kick us off this hour in Knoxville, Tennessee. How can we help Trevor? Hi, George. Hi, Dr. John. Thanks for having me on the show. Sure. Um, basically I'm, my fiance and I are just got into an auto accident and we're expecting to get an insurance settlement of probably around $10,000 each. And she has a little bit of outstanding debt on her car, probably less than the $10,000. And I'm debt-free, but need to build up more of an emergency fund. Basically, my question is, should this be a deal- a deal breaker as far as, like, if she decides to go spend it elsewhere and not pay off her car?

Because of a misalignment on financial values? Pretty much, yeah. Have you guys talked about this before? Um, so she had some credit card debt and basically she paid it off, um, in full right after, like, it wasn't very much, it was like $1,300 and she had basically come into a large tax refund and she did it then, but this is just a much larger amount of money and she doesn't, she hasn't been as, uh as gazelle intense if you will on paying off that debt

here's my bigger red flag for you two that a conflict came up and your mind your heart went to should I end this?

Okay. Here's the difference. My wife and I get sideways, which happens with some regularity, and over the years, we've gotten very, very sideways. Only once or twice have we looked at each other and said, maybe three times, is this it?

And those are nuclear options. So I would be willing to bet money. Tell me I'm wrong, man. I'm happy to say I'm wrong here on national radio, but there's other things going on in your relationship having to do with conflict and values. Is that fair or no? Yeah. I would say a lot of them are stemming from money issues and just some of the advice that I've gotten from other mutual friends that I trust is more like if you can't get the finances right and on track with each other,

then it's kind of destined for failure. What attempts have you made so far? I mean, you guys are already engaged. What attempts have you guys made to get on the same page with money? So I've offered numerous times to go through the Ramsey baby steps with her to help her with budgeting. She's just not interested in that. When we're budgeting for the wedding, she tends to overspend and not really stick to the budget that we aligned on and issues like that.

There's two issues here. One, you all make agreements and she violates the agreements, however small they are. Two, you've come to believe she needs a pat on the head versus we want to build a new thing together. Do you see what I'm saying? Yeah. I've offered to sit down

and tell her to put her pencils in the tote tray and then I'll hand her the map colors and then I'll show her the right way to do this thing to which she's not interested in being patted on the head. And that's different than you saying, hey, let's build a life together. The second part of that is, she doesn't give a crap what y'all discuss.

She's going to do what she's going to do. And 99.999% of the time, it's not just about money. It's about who we're hanging out with. It's about what our values are going to be. It's about what jobs we're going to take. It's about who we're hanging out with it's about what our values are going to be it's about what jobs we're going to take it's about where we want to live how many kids we want to have that's what i'm getting at because because about money to me go ahead the crazy thing to me is that on i would say 95 of issues that are not financial, we agree. And we completely, we respect each other so much, even when we're arguing.

And, I mean, we have a great relationship outside of a few financial mishaps. And I guess when I was originally calling in, it wasn't, should I break up with her immediately? It was, should I continue the relationship? The bigger issue here is less about the money and the quote-unquote mishaps. It's that you have looked at your the person that you're about to spend the rest of your life with and you said this really matters to me and she has looked at you and said i don't care i'm gonna do whatever i want to do that's the part that would give me pause if you're arguing about whether we're going to use airline miles or not,

or if it's the Ramsey plan, those things can be overcome because there's a general sense we both value freedom. We both value people, banks, other things not telling us what to do in our marriage. We'll get to the solution there.

But you have said, this is of high importance to me. I want to start my family, and I want us to be free. And she said, I don't really care. I want shoes and a purse. I don't care. That's the issue. So you don't think it would relate at all to what she,

like if she were to pay off her debt? I don't think you've told her to i don't think you've told her i don't think you've fully explained it i think you have said i want to be debt free do you want to do you want to hear my lecture on debt freedom i want to be debt free do you want to um let me show you how smart i am with these steps these baby steps i think I think she said, I really don't, I'm not interested in that lecture. If you have said, I'm scared to death about owing anybody money ever. I saw what it did to my parents. I'm not doing it. Will you build a life with me where we're going to go slower and buy less nice, fancy, brand new things initially so that we can buy whatever we want and give recklessly later

on in our lives cool that's the conversation but you're outsourcing your feelings to a spreadsheet to a plan to dave ramsey and i want you to connect and be vulnerable with your future wife and say i'm scared to death about owing money and we can't even get the difference there i guess yeah i i do i'm also a little hung up on where because we aren't married yet and so i am trying to find that line of where She's, I mean, she's 21. She's allowed to. I'm 26. Okay. Yeah, don't get into the she's not allowed nonsense.

You're not her dad. She's allowed to do whatever she wants to. And you are too. But it's going to affect you. And so I would say as a next step, after you do everything John said, then you say as part of the premarital counseling, let's go through Financial Peace University so we can have the same language and speak from the same book. I love that. I love that.

Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. Open phones at 888-825-5225. Let's head on over to Charlotte, North Carolina. Jackson is waiting on the line there. What's going on, Jackson? How's it going? We're doing well, man. How are you? Very well.

How can we help? So I have my job. I work as a graphic designer, and I'm paid based off of contracts. So when I get a new contract, that's what kind of gets it. It's not like a regular nine-to-five money-to-write-a-job or regular paychecks. But it's through a company? No, it's for myself. Okay, so you're a freelance graphic designer.

For myself, yeah. Got it. And so my goal is eventually to move back to Philadelphia, but the cost of living there is so expensive that I've chosen to stay in North Carolina where it's much more cost effective. And I went about 18 months out of work from where I was in a car accident, injured my neck and had to go through several months of extensive therapy. And so during that time period, I had a bunch of credit cards that had been charged off.

And now that I'm back to working again, I've been working to pay those charge-offs off and negotiating settlements from them. But my goal is ultimately to get back to Philadelphia. And right now with the house that I'm in now, I have like $43,000 left on it, and it's worth about $225,000. My car is about $27,000, and it's worth about $35,000. And between the work that I've got scheduled for the rest of the year,

I have about $115,000 worth of income coming in. That's after-tax income. Okay. And my question is, do I just pay off both my car and my house and not have any debt and then work on things going forward from there and stay here in North Carolina? Or do I keep those two things and let them use to try to rebuild my credit back up because my credit is destroyed? What do you need credit for?

So that when I want to move back to Philadelphia, I can sell this house here in North Carolina and buy a house there. Okay. How old are you? 32. Are you single? I am. Okay.

What's left on the charged off cards? The total balance between all of them is about $16,000, but they've offered settlement amounts that total just under $8,000. Why don't you just go ahead and do that? Yeah, I can do that, but it just doesn't, like, I've done about half of them so far, and this is what's left over. Okay. How much money do you have right now?

I have about $5,000, but I've got a big job that's coming in next week, or the pay-for-movement that's coming in next week, which will be about $48,000. Awesome. Okay, so let's say next week you settle for the eight. You get that in writing. Don't give them access to your checking account. You do a money order cashier check to get those out of your life. Okay. So that would be my first thing is dealing with the charged off cards. They don't remove them from the credit, though. It just puts it in zero balance.

It still keeps your credit going. It'll take a little while for your credit to get out of the dumps with these charged off cards, but that's okay. I would not work on trying to build up your credit by using credit cards and all of that. I wouldn't play that game. And by the way, it'll settle itself. You borrowed the money. It's the right thing to do to pay it back, right?

Right. And that's what I've been doing. I'm a little over halfway done. I've been doing it for the past few months. I just started back working. Okay, good deal. Good deal. Let's don't care about they charged us off. I borrowed the money from them. Let's don't care about they charge this off. I borrowed the money from them. Let's get them their money back and square up. So once you pay off all these accounts,

I love the idea of you becoming completely debt free. So once the charge off cards are gone, I'd go ahead and pay off the car. Once the car's paid off, any money left over, let's go ahead and pay off the house. And that's kind of a forced savings plan. So number one, you'll have no debts at that point, right? No open lines of credit?

Right, no open lines. Including no credit cards open? Because that's going to keep your credit score alive. Yeah, I have two credit cards that are not covered here at Balance. They're like secured cards that just to try to rebuild it back up. Because there's another strategy, and it's one I used,

where you just get rid of all lines of credit, cut up the credit cards, you have no open accounts, and then six to 12 months later, your credit score disappears. Me too. So it'll still sit on your credit report that you had these charged off cards, but it's not going to affect your score at that point. So what do you mean it disappears? Me and George have zero credit scores.

Yeah, if you, I just pulled my credit reports for fun and pulled my score, it says indeterminable because we have no debt to our name. We don't have a single credit card open. We don't have a mortgage. We don't have car loans. And so six to 12 months later, in general, the accounts, as you try to pull the score, it'll just say indeterminable. And at that point,

what you can do for a home is something called manual underwriting. And it's what I used to get a mortgage a few years ago, where they look at your actual financial picture, they look at Jackson, they go, oh my gosh, he makes 200 grand. He has no debt. Here's his tax returns. He has a stable income. We're going to give him the loan. And our friends at Churchill specialize in this. And so it's a thing a lot of people don't know about, Jackson. So it's not like a widely known thing. We've been talking about it for 30 years on the Ramsey Show, but out there in the culture, they go, oh, my gosh, it's not possible. It's so difficult.

It's so expensive. And John and I are just like, no, we did it. Jackson, here's the scam. You want to hear the crazy scam? Yeah, what's up? If this guy calls you who owes you $48,000 and says, you know what, I just love you. I love the work.

I'm going to give you $4.8 million. And you put that in your checking account, that would not affect your credit score in any way, shape, or form. You'd be a multi-multi-millionaire. Your credit score has nothing to do with your wealth status or how you're doing financially. It has to do with how well you've managed debt and you have not managed it well. So your score is low. You can, it's like being a bad boyfriend in middle school, right? You can be like, no, no, no, I'm great. I'm great. I'm great.

I'm just going to start dating everybody. Look how great I am at dating. Or you can just get married and find one and then just move on with your life. Right. You see what I'm saying? And so I just opted out of the system. And by the way, Jackson, think about this. What if in another world you could pay cash for a place in Philly?

Because let's say you pay off this house. You have no debt. you keep making the great money you're making on top of the $225 your home is worth, which by the way, you'll have 100% equity when you go to sell it. You'll get that money back out minus fees. Well, you might have $400,000 or $500,000 by the time you move to Philly to put down on a house. Right. Oh, my goal was to move before the beginning of next year, but it's just so much more cost-effective to stay here. Yeah, I don't... Is there an urgency where you need to get to Philly by January? No, just where my family and friends live, and I moved back here in November of 2022. Okay.

And was initially supposed to be here a year, and then the car accident happened, and then from from there it spiraled out. Friends and family aren't to be discounted, but it might come at a cost and the cost might be, I'm going to go to Philly and I'm going to rent. That's not a bad thing. It gives you community. It gives you family. It gives you connection.

That's great. And hopefully from those, plus your work ethic and your ability and your talents and your, you'll end up doing great financially. But it just sounds like something's got to give either you're going to be a homeowner and you can afford to do that in the world you've created for yourself there in north carolina but also it's kind of lonely we're going to be surrounded by loved ones and friends and i'm going to pause on the home ownership dream right now i'm going to rent a place and i'm going to stack up cash for the next four or five years and have a group of people I can do life with. That's not a bad option either.

It's not. I just, I hate the idea of renting. I get it. I get it. Do you hate the idea of being lonely too? I do. Yeah. That one concerns me more for your, for your heart and mind and soul, for your physiology. That one, that one, that one bothers me more. And renting will also free you up mentally. I mean, just not having to think about home ownership. You're living it. It's not like it's without its problems too. There's still maintenance, repairs, things to be paid. And so to have some freedom as you move to Philly and kind of restart your life and rent, maybe if it's a six month lease while you just look for housing and find the right spot for you in the right

neighborhood. I don't think that's a bad plan, but also you'll have an amazing down payment. If you do what we said and you pay off all your debt, paid for house, you'll roll all that into the next house. And you can get a loan through manual underwriting. So hang on the line, Jackson. I'm going to send you a copy of my book, Breaking Free from Broke. It'll walk through the process of manual underwriting. I have a whole chapter on credit scores to help you through that, a whole chapter on credit cards to convince you to cut those up. And I hope it convinces you that there's a better way and a simpler way, a more peaceful way to live your financial life. Thanks for the call. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Camel,

joined here by Dr. John Deloney. The number to call is 888-825-5225. Brian is up next in Toledo, Idaho. Brian, welcome to The Ramsey Show. No, it's Toledo, Ohio, but that's okay. What's that? It's Toledo, Ohio. Oh, what did I say? Idaho. I thought you said Idaho. Maybe not. Oh, I probably just stumbled through it fast. That's my bad, Brian. How are you doing?

Don't worry about it. Well, I'm doing fine. So I don't know where to begin. All I know is that back in 2019, I was kind of semi-retired. I'm 65, father of 10, you know, and I was kind of semi-retired. My wife still works online as a school teacher. And my son came to me and said, hey, Dad, I want to start a website and call it what you used to call your old store. And I said, fine, let's do the website. And we started in 2020, and it just took off. We started selling one product, which is a very highly profitable item, and it took off.

2020 was a phenomenal year. We were getting these special exclusives for our product, and no one else had them, and very high margins. But my sons, I'm 65, so I never really had a lot of debt when I had my other businesses, and so I'm not afraid of taking a loan out for a small business, for our business. But with my kids, both of my sons, it's like, Dad, that's the worst thing we could do. And I said, okay, well, then I don't know how we want to grow this if we can't grow

it by taking out loans to help build the business grow. What do you need a loan for? To buy certain products that we don't necessarily have the cash right now for. So is there a different way to go about this to where you could pay cash for a smaller amount of inventory and grow slower? Well, I'm open to suggestions. See, here's the thing. So we, and I don't want to give my business away because I don't want to necessarily, I mean, I can't. John and I will steal it. So I think that's wise. Exactly. That's good. But the product that we have is very high margin, 50%. So, you know, we, you know,

so if I got a,000 with a product, I'm going to be able to double that to $2,000 very easily. Right now. Right now. What? Right now you can. Right this second, yes. But don't you remember 2020?

Yes, and that's where we made all our money in 2020. I know, but your neighbors did, and they lost everything. I know they did, but they still were buying our product. I know, only until Google doesn't change their algorithm on you. Then it's over. They start charging double for the same ads. Yeah, they quadruple the ad buy.

Or Facebook says, we don't do ads anymore. Like, your kids are right on. My question, what's your draw? What are you three drawing right now? Well, I'm not, I'm drawing nothing because I'm kind of samurai tired. I don't live, you know, I don't spend a lot of money. I just, cause I have my, my little shed and it's filled with everything I want. So, um, I'm drawing like $500 a week. You know, it's, I'm not drawing a lot. So what is the net profit from the business per month? Well, I mean, yearly or monthly?

Or yearly. Well, yearly we did, I think, like $900,000 last year. That's net profit after all expenses? Half that. Okay, so about $450,000. So who made the $450,000? Because you didn't. Well, um...

Is it going to the kids? Well, no, it went back into the business because my son opened a mattress store last year to take pressure off of the online store, the online toy store. Okay. So that... And he's doing this mattress store, which is very profitable.

But did he take, hold on, did he take the 400,000 from the business and put it in the mattress store? Well, he did, he did take some from me, like probably maybe 25 to get the mattress store going. But it sounds like there's a lot of money sitting in this business, or are you just buying more and more inventory? We have about 600,000 in inventory. Okay. Okay. So that means you're sitting on $1.2 million of inventory if every sale doubles, right? Yes, exactly. Then why don't you just decide we're going to take 750,000 bucks and put it aside for expansion. And we're going to choose over the course of a year to make less money together because we're

going to invest in this company. And if something goes sideways or it slows down, we just got a warehouse to pay for. We don't have creditors to pay off. So you don't, and listen, I'm just asking because I'm not, I told my son, listen, this is your business. I'm just giving you my opinion, but it's finally going to be your decision. I'm stepping away in a sense that I'm just a voice. You're just giving them the business for free? Yes. I'm sitting in about $500 to, depending on who you ask, $500 to $600 million worth of paid-for real estate in a paid-for studio that has a paid paid for theater on top of it and that has a thousand employees here and it's taken 30 years or as dave says he moves at the speed of cash

there was one season when half of this building was built and the other half wasn't built because we move at the speed of cash okay so it's cash. And capitalization, probably, no, not probably, 1,000%. Dave could have borrowed money and hoped it worked out. I see, okay. And 99% of the people who were in radio 30 years ago are not in radio anymore. And maybe he would have been the one. But there would have been a 99% fail rate on it. So do it when we have the cash.

Exactly. Yeah. And if you need to move slower, you move it. So do it when we have the cash. Exactly. And if you need to move slower, you move slower. But it reduces a whole lot of risk, it increases the peace, and it helps the chances of this business living beyond you. And I think you make smarter decisions. If I go to my banker and say, hey, I want to go buy a car, and he looks and goes, you can go buy whatever you want, man. When that dealer's like, man, we can really give you these upgrade i'm like all right i can do that

if i have me and my wife have this much money in our checking account i can't i'm gonna buy that car and you're more resourceful in fact you're gonna give me those wheels or i'm walking out the door i'm gonna find somebody that will all right we'll put them on there right or i'm not gonna buy the car. Let's wait. And we've seen the other side of this, Brian, where people call in or they show up on the stage and they go, we have $300,000 of business debt for a business that failed, that we had to shut down the doors of. And those are the stories that are heartbreaking. We have not that problem.

We are selling like crazy. Right now? Brian, how long have you been in business? Well, I mean, I've been doing this off and on small businesses for 40 years. And during 2008, you were doing 100% margins? Yes. 2009, you were doing 100% margins? Yes.

You've never had a down year? Well, like I said, the last two years have been slow, but because the type of business that we have, the type of product that we have, it sells when the economy slows. I've been selling the same price toys. I've been selling the same product for 40 years. And whenever the economy slows down, and we sell slot cars.

I won't tell you the name unless you ask me, but slot cars, the road race sets, they sell like crazy. We can't keep them in stock. It's just unbelievable. I believe it. The more I get, the more I sell. I have to believe you because I've never heard of a slot car, but I'm not very cool, so that doesn't mean anything. Old-fashioned road race sets where you put the car on the track, you pull the hand throttle, and the car drives around the track. That sounds amazing.

And you know what? It's high on the screen, so I'm going to buy one just because I don't want kids off screens. I want them playing with real cars, so good for you. I just showed John a picture so he can get a real grip on it.

But here's the deal, Brian. Your kids don't want to run the business with debt. I applaud them for that. I would let them do it. It's not going to add any risk for them to do that and i think it'll how it'll help that business succeed and brian it's their business and it's going to be their future there's an economic principle called the the i'll call the turkey problem i don't remember the exact words but it's the turkey principle you know what it is is? Okay. No, tell me. I'm

curious to hear it. On Friday, the day after Thanksgiving, a turkey is born. And the farmer loves that turkey and feeds that turkey and pets that turkey. And for 364 days, that turkey looks at that farmer and says, he's the greatest guy who's ever lived.

I've got it made. And then Wednesday night, the day before Thanksgiving, the turkey becomes dinner. And everything works out until it doesn't. That's why having a hedge, which is, I don't owe anybody

any money. If this goes sideways, I've got a warehouse full of cars that stinks, but I can still eat, my family's safe, and we're okay. Man, that turkey problem, everything works until it doesn't. So I'm going to hedge against it all going away because I wanted to borrow money because I just couldn't keep them in stock until I can. We'll be right back.

This is The Ramsey Show, our scripture of the day, Proverbs 11, 24 and 25. One person gives freely, yet gains even more. Another withholds unduly, but comes to poverty. A generous person will prosper. Whoever refreshes others will be refreshed. Sigmund Freud said, Most people do not really want freedom because freedom involves responsibility, and most people are afraid of responsibility.

Amen, amen, amen, Dr. Freud. Don't be afraid, John. Amen. Do not be afraid. I think people, I think that, read that again. That's such a profound quote. Most people do not really want freedom because freedom involves responsibility, and most people are afraid of responsibility.

That's right. I think people i think we as a culture we we don't want freedom we want comfort oh we want to not be bothered by we want whatever we want whenever we want and if anyone says we can't have whatever we want whenever we want we throw a temper tantrum we yell and scream and kick and blame doesn't matter what math says doesn't matter what physics says it doesn't matter what math says. It doesn't matter what physics says. It doesn't matter what anything says. I want what I want, and I'm going to be a big baby until I get it or until I can burn what you have down.

And Freud is right. Freedom comes with a set of choices. It comes with responsibilities. It's heavy, and it's scary, and it's hard, and it's collective. And we don't want that. We want to want it, but we want to be comfortable. And we have traded all freedom for comfort we've traded we've traded um we've cashed in everything we've cashed in our integrity we've cashed in everything for comfort

well now we're living in wally that's our version where we're just like in these chairs just moving around can't get up can't be bothered bothered, just shoveling food into our face. And freedom requires responsibility, and responsibility requires weight. It requires discomfort. And we as a society have cashed out on it. We don't like it. We don't want it.

And we avoid it at all costs. Then we find shortcuts to it. And that's how debt, the shortcut to the American dream is just debt. I'm going to borrow it. Which is the opposite of freedom and there is always a cost always a cost man it's a good drives me crazy it's a good word old freedom and he saw it come freedom it's right there seek it

drive it use camry don't be afraid of it god almighty that's a good word we riled up john just with the quote of the day so this next call call is going to be a real barn burner with Brandon in Dayton, Ohio. What's going on, Brandon? Hey, George. Hey, John. How are you guys doing today? I'm all riled up, Brandon. What's up?

It's funny you say barn burner. We've got a barn we'd like to burn down. Hey. Hey. George will help you. He'll overheat his Tesla right in the driveway. If it's not fraudulent for insurance money, then'm i'm here to listen what's going on there you go hey so we recently here about a month ago got into baby steps four five and six and we're just

really curious to get your guys's intake on what intensity versus intentional looks like on paying this house off i i'm gonna be honest I'm not a good person to ask. John and I are both pretty intense. More than the Ramsey plan entails. I'm overly intense when it comes to owing anybody any money. I hate it. I don't sleep. It makes me cranky.

I just hate it. I hate it. I hate it. I hate it. I hate it. So, in fact, Dave and I have had some off-air discussions about intensity versus, it's very hard for me to not get pretty baby step two about paying off a mortgage and I also know that's not sustainable and that's

not healthy and it's not wise but it makes me crazy it was right for our families so but what's your situation so we we pretty much came into you guys we lost you oh there we go let's get intense you still there yeah here we are. Speak directly. Speak right on the phone and start over. Can you guys hear me? Yeah, perfect, perfect. Yeah, you there, brother?

Oh, man, it was going to be good. We lost him. We'll see if we can get you back on, Brandon. You guys still there? Yeah, there we are. You were cutting in and out. Let's try it again. Hey, sorry about that.

So we came into you guys right in the middle of Baby Step 3, and we decided Intense was the way we wanted to go with it. And we sold a truck. We sold a Yukon. We bought a minivan. We did some things. People were looking at us like we were nuts, but we built a third. All right, brother, we're going to have to put you on hold and let you you're just cutting it out that would have been fun sorry man all right let's roll to

philadelphia we were born and raised and talk to colin call us back brandon we'll talk all right colin what's up hey guys thanks so much for taking my call you bet hey um dr john i'm also glad that you're here because i think uh i'm dealing with a lot of financial and emotional problems that are tied together. But I feel like I'm just not letting myself off the hook as far as I'm just hard on myself comparing my financial situation to other people around me. I turned 25 back in May. Currently, right now, between my day job and my serving job, I make about 4,000 a month. Um, I paid off 20 grand in student loans. Um, and I'm living at home right now, which is a situation I'm very grateful for because,

you know, rent is just crazy. Um, I have 26 grand saved right now and I just started investing in a rough. So I only have 1100 in there, but how do you think I can kind of let myself off the hook? And am I doing good enough to, you know, I'm budgeting, or how do I stop comparing to others around me? Here's what I know about me, okay? I know that when I get emotional about something or i get intense about something um i don't make good rational i don't see the world as it truly is i see it as i feel it and so i always want to do two things number one i want to look at the data

what's the data tell me what's truth i want to examine two things. Number one, I want to look at the data. What's the data tell me? What's truth? I want to examine these stories I'm feeling. I'm unsafe. Nobody loves me. I'm not where I should be. Everyone else is winning and I'm not. Right? Those stories. I want to examine them and ask, is this true?

I'm going to look at the data. As you just rattled off your situation, you're 25. You've paid off 20 grand plus debt. You got $26,000 in the bank. You're making four grand a month. You're 25. You've paid off 20 grand plus debt. You got $26,000 in the bank. You're making four grand a month. You're working two jobs. Bro, you are ahead of 95% of the United States of America.

And again, I made up 95. You're way ahead of millions and millions and millions of Americans. You have a positive net worth, which is something most americans can't say so when i look at the data that story is not true so then i want to go to somebody else in my life and ask them hey man you're looking at my life am i not seeing something sometimes i'll ask george like man i don't i don't feel like i'm doing all right he'll say dude you're

doing great things are good or no you need you need to be making it, making a different inroads here. So let me ask you, who's telling you this stuff? It's all just internal. I think one of my character traits, and I know it is for everybody, but we're our worst critic. And, you know, I think it's just, um, and I, and I think also looking at just the housing market, cause at my age, I would love to be able to move out. But the rent around here is just unrealistic for, you know, at least one person right now. You know, I don't want to be houseboy, as you guys say, or, you know, try and do something that's not too manageable. Let me push on you a little bit. Can I push on you?

Yeah, of course. Don't ever say character trait again. Okay. Because you can Yeah, of course. Don't ever say character trait again. Okay. Because you can choose a different story. I like that. It's a choice that you make. When your body sees negative, it's a choice that you choose to dwell on it

and to get to spiral down and then to start looking at real estate prices on your phone while you're waiting in line at Walmart and then to see if you got any extra hours at work because you asked for them but you didn't really ask for me just texted your boss and they said we'll see and then I'll give you any it's easy for you to spiral down and that's a choice the other side of that is to choose to see dude I am making it work with what I got and I've got some hard choices coming up I'm 25

I want to be a homeowner and I want to live in Philadelphia one of those two things is not possible so I can spend energy hating everything being mad at myself or I can start looking at other um other zip codes I can look at apartments I can look at roommates. I can look at roommates. You've created a world that you can't live in because reality doesn't allow for it. Math, geography, real estate, none of it matters. And that's outside of your control. And so the choice you have is just to wake up every day and be miserable or to see, dude, I am ahead of most people. And I had some different dreams for myself. What must be true for me to have these dreams when I'm 27 or 29 or 30? Do you get the difference?

Is there a number that would make you feel like you're doing okay? It's funny. I just had a bad talk with my mom recently because I actually, unfortunately, had to replace a car. So I have a couple more grand left. That's the only debt that I have. Like here's four grand. I punched numbers for you, Colin. You're in a season right now where life's kind of hitting you.

You're living at home trying to pay this off. If you keep investing 15% of your income right now, 40 grand, it never changes, 48 grand, you'll have over $2 million, close to 3 million at 62. You're doing okay. Just turn off the inputs and run your own race, my friend. This is The Ramsey Show. Bye.