The Ramsey Show - App - If You Want To Do Great Things You Need To Do Hard Things First

Episode Date: October 3, 2025

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Normal is broke, common sense is weird. So we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union Studio, this is the Ramsey show. So excited to have you with us, Triple-8-8-8-25-5-2-25 is the phone number to jump in. AAA 825-5-2-2-5 alongside the fabulous, the incomparable Jade Warshaw. I am. Thank you, my friend. Ken Coleman, just happy to be in her presence, folks. It's going to be good, fresh off of Orlando. We might talk a little bit about that. We'll see. Orlando, I can't speak now, and Chicago.

Shy Town. A couple live events, so much fun. We are. feeling the juice from those two great crowds. Jessica is up in Arkansas. Jessica, how can we help today? Hi, good morning, or good afternoon. I'm sitting at just a tad bit under a million dollars in debt. Almost 200 of that is unsecured, and we were contemplating bankruptcy, but my face tells me that I should be paying all this, and I know I should.

And I'm just, I guess I'm trying to see if there's a light at the end of the tunnel for us. There's always hope. Why don't you lay it out for us? Give us the whole $1 million in debt. What is that? So 210 is unsecured personal loans. 83 of that 210 is credit cards. The house is $658.

Okay. And then there's two vehicles that, um there's two vehicles in there one's almost paid off and then the other one is very very upside down tell us the amounts uh the first and the second um one is we owe 12,000 on it and the other one is 59,000 oh and how much do you know off the top of your head what that 59,000 one is worth um 35 girlfriend okay um how much do you guys earn it's you and your husband yes and he is in a job transition um so we were making over 300 now we're at sitting at about 259 a year okay good that's listen there's your light at the end of the tunnel right there is

if you had told me that your shovel was 60 or 70,000 I'd be really hurting with you um but the good news is you have a really great shovel uh 259 and you said that's With or without the job loss? That's with the job loss. And his new job is going to be commissioned only, so we haven't, we don't know what that's going to look like yet. It could be amazing. So you make, you make $259.

We have some retirement funds in there from military and disability. How much of that is the military? Like how much of that is your income and how much of that is like pension type stuff? About half. Okay, good. That is really, really, really, really good news. Tell me about the 210,000. Was this a business loan?

What was that money for? It was a little bit of everything, honestly. It was some bad business endeavors, me trying to be a serial entrepreneur. It was some bad financial decisions, just in general. Imposter syndrome. I took a fantastic career opportunity. and I just kind of shopped my way through the imposter syndrome until I got to therapy. Okay.

And so that was some bad financial decisions there, luxury shopping. And then I took over, I took out two personal loans to clear my husband's credit card debt as well. So that's what all that is. This is like classic mo money, mo problems, right? This is you had a big income and so you could afford to make big. mistakes, right? But really, when we boil it down, Ken, this ratio-wise, it's the same call we always hear, right? Yeah. So that's the good news is, you know, you've got 260,000 in income right now. It's going to go up exponentially. And you got, you know, I'm not counting the

mortgage debt because when we're in baby step two, which is the step where you're paying off all the consumer debt, we really don't count the mortgage. So can you tell me how much your monthly mortgage payment is so I can see what percentage of your life it is? 39 38 okay and so that's going to be fine with what you're bringing home so that the mortgage is not the problem and I just wanted to explain that to you it's no more than 25% of your take home so that's not the issue the problem is you feel overwhelmed because no matter how you slice it if you if you tell somebody you have 300,000 dollars of debt that that's a lot right yeah are you familiar with our debt snowball yes I actually did it probably about 20 years ago and I the only the only

that I carried up until three years ago was a mortgage and a car payment. And I would usually pay the car payment, you know, double or whatever. Yeah. Well, are you, okay, we get that, but let's talk about the now because your question is, is there a light at the end of the tunnel. The answer is yes, if you're willing to look for it. And so are you done now? Are you done? Is this the last time you're ever going to do this? Oh, for sure. Okay. So, I can't do this again. Okay. So in this situation, my take is I would try to get massive momentum, you know, and Jade can speak to this. I'm going to give it back to her quickly because she and Sam paid off $500,000 in debt. So you got the perfect person to talk to today. But here's my only thing that I would say, and I'll hand the baton back to you, Jade. I think they need a momentum play, like a big one. And so I would be a tack, I would try to get rid of the $59,000 car payment. instantly. Even if they go upside down, you can tell her how we do it. But I just think there needs to be a dramatic move. I don't know what your take is, having done this yourself. No, I agree with Ken 100%. You do. You need to do something that's going to shake you emotionally, that's going to shake you financially. That's going to almost like, it's like the gun going off of the race, right? And I agree with Ken. You guys need to pull together. And I mean, with your income and in a couple of short months, pulled together that 24,000 that you're, upside down on this vehicle and get out of it. And, you know, drive the $12,000 vehicle for a while,

figure out a plan to save up another, you know, a couple thousand dollars to get you a beater. And here's the thing. I'm going to be 100% straight with you. You're used to making a lot of money. When you get a beater, it's going to mess with your ego big time. Because in your mind, you're going to go, wait a minute, I work too hard to be driving a car like this. Wait a minute. Nobody at my work drives a car like this or nobody in my social circle. right because you start hanging out with who you earn money with right and so you're going to be the one and it is going to create questions and it's your choice whether you answer those questions but I'm just letting you know right now Jessica that's going to happen and there's going to be an

incongruency for a while with how hard I'm working and how much money I'm earning versus the lifestyle I'm living and I'm telling you that as a person who did that for quite a while and that's going to be so good for your soul because that's what's going to cause you never to do this again. You're going to go, oh my gosh. I never want to feel that again. Seriously. I think it's right. And, you know, not trying to steal too much of your story, but I mean, Sam and I were hanging out last night, Jay Tuss, and he reminded me you guys had one car for a long time. We didn't get a second car until a year into working here. Yeah, but that was just because you adjusted to it. I did. But during the massive debt payoff, you guys were one car family. So. But you said it, Ken. We got

used to it. That's right. You did fine. You get used to anything. Right, right. You could be making multiple six figures and get used to whatever lifestyle you create. Yeah. That's hilarious to me that you were here for a year before you got wheels. And even still, I was a little reluctant. I was like, we don't need it. Listen, now get me that G-wagon. I'm ready, Ken. Come on. Hi, O. April, how can we help you today? Hi, guys. Thanks for taking my call. So I am recently divorced, 44 years old. I make $50,000 a year.

I have one debt, and it's a car, and I owe $29,000 on it. And I have to decide whether I want to keep the car, sell the car, pay the car off, or what to do with the bag on car, because I want to be completely out of debt. and I want to eventually buy a house. Tell us how much the car is worth right now on the open market. About 23, probably. So upside down, six. Do you have any cash?

I have $57,000 in the bank. Oh, this is a non- Yeah, sorry. Is that the only debt you have? It is the only debt I have now. Okay, go ahead, Jade. Yeah, okay. In the infamous words of Ken Coleman, this is what I'd call a nothing burger.

Oh, yeah. Which means there's no problem here. That's right. You can decide today to just pay it off. Well, you've got the money. Right. Right. Why are you not doing that?

What's stopping you? Well, because I'm trying to make sure I have enough money for a down payment on a house. Got it. And so in the Jeep is currently my ex-husband's name. So I have to either refinance it my name, pay it off, get it titled to my name, or I thought about, you know, live on my husband. like no one else. I can live like no one else and selling the daggone thing and driving the junker for a little while. But, I mean,

I don't really want to do that. My car is reliable. It's only got 50,000 miles on it. Like, it's a good vehicle. It's not really the vehicle I wanted when I purchased it. But it's in his name? It's in his name. It's in his name, yeah. Well, either way, yeah, either way, you've got to, if it's going to be your car, you've got to move it to your name and make sure that you're the one who gets the title and everything. like that. You don't have to eat up most of the 57. I get what you're saying. So you said you're upside down 6K. So if you sell it for 23, okay, and then we take the 6 out of the 57, that leaves us

with 51, and we're a hole on the car. And then I'm telling you right now, like this is the spiritual gift that I have that nobody knows except for James Childs. He can attest this. I can find you a car right now for 10 grand that is extremely functional. It's not an absolute piece of crap on wheels, and it will get you through it. And let's say now you're down to 41,000. You're debt-free. You've got a serviceable car, more than enough in the emergency fund, Jade, to fix the $10,000 car. I mean, you could go 12 and get a very serviceable car.

And now you're debt-free emergency fund and now on to Baby Step 3B, which is saving for the house. Unless I'm missing something, there's a very serviceable car. There's no reason for you to hold on to this money because we're not telling you to go empty it or even cut it in half. Right. So you think your advice then would be to sell the Jeep, buy something cheaper and just take the $6,000 loss instead of paying it off completely. Oh, I thought the $6,000 is paying it off completely. You're going to sell it for $23. Well, I mean, to keep it.

I mean, your advice is to sell it instead of keep it. I would personally. I would because it's attached to him. I'll explain my reasoning. There's no right or wrong on this is what I'm guessing you're going to say. You can keep it and pay it off. Like to Jade's point, you could pay the entire 29 down today out of the 57. Now you got yourself a car that you're used to and yada, yada, yada. Well, the only reason I wouldn't do that is because, yeah, Ken is right. It's too much of your take-home pay. Like it's too much of your pay. It's more than it's more than 50. 50% and you probably would not have bought this car if you were just you, right? You would have bought something more affordable. And my advice was based on helping you save for the house. So I gave you the advice to spend the least amount of money but still be moving forward in your life. Gotcha. You track in with me? So you sell it. You get 23 for it. You're going to come out of pocket six to take care of the loan. Now you just got a bunch of money back. What's that car payment

every month? $563. Girl, that's like almost $8,000 a month. I mean, a year we just saved you. Now, okay, you go buy a $10,000 car, and you're still left of $47,000, the way I added it up earlier. And so you've still got a real nice case of momentum here because you're coming out of the divorce.

We got rid of a car with your ex's name on it. It's too much car for you. all the things so that's why i gave you that plan because that is what i would do if i were you that's what i would do and it's going to feel good getting your own i almost said set of wheels and then that felt very retro you're going to feel good getting your own car that's because she hangs out with me that's me that's my old influence on you that should say whip you're going to feel good at your own whip that's not it either yes exactly you know what i mean awesome though that helps so much i thought that's what you guys would say but i wanted to just make sure because i was literally going to

call and just pay that off today. And then I'm like, do I really want to do that though? No, I really want to a car. Think about, see, here's the thing. We get rid of a car attached to a chapter of your life. It's over. That's not the single reason for this, but it's a good reason. And it's all about momentum. Many times our advice is about momentum. Getting that, and boy, just getting rid of that $560 car payment. That's a lot. That's going to feel great, getting rid of that other car. And now you go get your own thing and you go, I'm sacrificing on a $10,000 car because I want my own house. Ooh, I like it. I on the prize.

And so if I am sacrificing Jade in the short term to see that it's going to give me an absolutely legitimate shot at the long term that I desire, man, that feels good. I'm in. You don't have to talk me into that kind of a sacrifice. And the other thing is, is I like to say this, and I get too excited about this, I know. But I can't begin to tell you how many decent cars there are out there for $10,000, $12, $15,000. And most Americans are just, they think they're above it. Yeah, I don't understand. I mean, I get it.

I get it. It's a status symbol, right? I totally understand. But I've said it before. I'll say again, Ken, you get in the car and, yeah, you ride to work. But it's sitting outside. And most of us, let's be honest, most people in America, if you have a garage, it's filled up with junk, and you let that beautiful Mercedes or that

beautiful, Accura, whatever you drive, sit outside, get in the rain, get in the, in the snow, and then when you go to work, it sits in the parking lot. Yeah. And no one is walking in the parking lot going, oh, I wonder if that's Bob's sedan, right? No one cares. Nobody cares. And I'll tell you this. A couple things.

And Jade can back me up on this. She knows what I drive. It would surprise a lot of people what I drive. I drive an older used car. It's a fabulous little Mercedes. looks fantastic, looks better, looks newer than it is, but I'll tell you this, nobody, and I mean nobody, pulls up next to me at the stoplight and goes, oh, ha, I got that Ken Coleman over there. I'm not sure why he's driving that late model there. Nobody cares. Nobody even

notices me on the interstate. Right. So, you know, I choose to do that because I've got higher priorities. Yeah, I am right there with you. My money is in other places, and you know. I do. And so, So, you know, for me, it has always been functionality over status when it comes to a car. Now, there's a day coming. Oh, it's coming. When I get all the kids off the payroll. G-wagon. Oh, man.

Yeah. They see me rolling. I'm going to have a car with a trumpet on it just so everybody knows I'm coming. Not a horn. Like a, oh, here comes Coleman. He wants everybody know that his kids are out of the house. It's going to be like a, by the way, at the Ramsey Show Live. I learned a new term.

Hit me. I didn't know there was such a thing as a push present. I'm wearing mine right now. Well, it's ridiculous. What made you transition to that? Because I'm going to have a baby. A empty nest present for myself. When I get the kids off the payroll, James,

you're going in. Daddy is going to go buy himself a really fun toy and just say, it's mine because I've taken care of everybody else forever. Thank you, ma'am. There's the lady out there who's giving me a really fun toy. really solid head nod. I like that. You get a retirement present. You get a present when you have babies. I am now making this up, James. It's an empty nest present. What? Stacey is such a lucky lady. Tushay, sir. That's great. She'll get something to. Yeah. What are we talking? I don't

know. I'm making it up on the spot. I don't want to, I don't want to commit. It's going to be expensive. It's going to be expensive. Hey, side note though, I think we should have a spin-off show where you people call in and you find them use cars live on the air and then send the link. I would love to do that. I'd love to be your used car guy. Ken's cars. I like this. It's got a nice little ring to it. All right. We'll talk about it. We'll see what happens, folks. Stay tuned for that wildly popular segment.

All right, folks, the all new. All new. And I say, when I say all new, I mean all new. Brand spanking. Yeah. Every dollar is here. And boy, oh boy, is it. it's worth all the hype. You can watch the premiere on our YouTube channel to actually see how every dollar works. It's more than a budgeting app. We've got all of the great things that you knew if you've been around for a while about Financial Peace University, actual coaching, so many great prompts. I mean, it's just there for you. People are finding thousands of dollars

in margin in just 15 minutes, just through the prompts and the pathway. we're walking you through. So imagine how you could, how much you could find to put towards your money goals. Again, go to our YouTube channel, The Ramsey Show, and we've got the premiere there, Jade Warshaw, Rachel Cruz, George Camel, our money personalities did a great job with that, super interactive. You need to watch it because it really does explain, I mean, we can't do it justice just talking about it for a second, but that premiere will do it justice. Yeah, so fun. Kevin is now joining us in Miami, Florida. Kevin, how can we help today? Well, hi. I was just calling because I recently graduated from grad school, and I have some loans and debt, I guess you can show. So I'm kind of transitioning in life from being like a student basically enjoying the workforce. So I just wanted some advice and like some wisdom, I guess you can take with me as I start this new stage of life.

Okay. How much debt do you have? So it's me and my wife, which my wife is still in grad school. She's in her, currently her second year grad school. And it's, I have a total of 180,000 and 140 of it. It's from my student loans. And then 15,000 is from her student loans. And then we have a total of 16,000 in credit card. Do you have a job?

So it took me a wide. to get licensed in my state. So I just got approved to be working in my state. Licensed to do what? Pharmacy. Okay, so I appreciate that you're licensed now. Do you have a job? Yeah, I just got a job yesterday. Oh, congratulations. Yeah. So I started that job in two weeks.

Do me a favor. Do me a favor. Can you adjust your phone? I feel like you've got a sock over your phone. Can you hear you better now? It's a little bit better. Sorry, I'm really struggling. My ADHD is like flaring. How much are you going to make as a pharmacist? So the job I have is it's not full-time or part-time.

It's basically as needed for them. So the hours aren't guaranteed. But I'll be making $71 an hour. $71 an hour. Do you have any sense on how many hours you're going to? to get, because I don't like the way this sounds for a guy who's got all this debt. Yeah, honestly, saying, but I've been applying to all these places, and this is basically the only one that really got back to me.

Right. But you understand, like, that's not a great deal. You don't even know how many hours you're going to be working two weeks from now. Yeah. I mean, during the training period, I'll be getting 10 training days, I guess you could say. so I'll for sure have that and then after that how it was explained to me

there's some weeks I'm going to be making doing like 20 hours in a week and then there's some weeks I'm going to be doing like 40 hours in a week so okay so you understand though that you've got to be more resourceful right now that means you're working at a coffee shop you're working two three four jobs right now

yeah while by the way looking for a better pharmacist gig because this is going to eat you alive. What is your total monthly bills when it comes to just these loans, all this stuff combined? So the loans are still in grace right now, and I don't like the repayment of it until, I guess, December. Okay. So. That's not long. Yeah. Brother, December is literally around the corner. Okay. Exactly. So that's one of the reasons I'm calling because it's just like, income my friend listen our debt snowball plan i bring jade in on this but i'll just say this income income

income is your issue right now you got a wife who's in grad schools i don't know how much she can work with the grad school load so i'm being realistic there i don't know what she can do so if she can't do much or anything i mean you're the one that's got to be working and when i said two three and four jobs i wasn't just saying it you know to hear myself think and talk you've got to bring an income because December is coming quickly, and it's going to be a rude awakening. And so it's the debt snowball plan. Jay to walk you through it. Step by step, what you have to do right now. Yeah, there's two things at play here. And Ken said the first one, you need money. Like, you got to have money coming in. And then the second thing, sure, you can tighten up your spending and tighten up your budget

and those sorts of things. By the way, we'll make sure that we give you a budget. We'll give you every dollar before you get off this call because you need it. But that is the equation. You guys have a hole here and you dug the hole, and now you have to do the work to get out of it. There's not really an easy button here. I wish there was. If there was, I would slide it your way, but there's not. So it is what Ken said, which is probably wasn't what you planned, right? We all plan, I'm just going to get a great job right away, and I'll just be able to get out of it. But that's not the reality here. And a part of this, I would say, of the equation, I would say 80% of you doing this is just accepting that this is what must be done.

And if you can do that, then you can go about the business of actually doing the actions. So part of it is saying, hey, if I want to get where I want to go, there's part of this. I just have to accept. It's like running a marathon, Ken. When Sam and I ran our first marathon, it's like in your head, you go, I know I want to do this. This race seems good. I'll feel great when it's all over. I want to accomplish this.

And then when you start the training, you're like, oh, wait a minute. minute. It's every day and it gets progressively harder and what if I get injured and my body hurts and all these things. And half the battle of running a marathon, which in this case, you're dead as the marathon, half the battle is just going, hey, this is what must be true for this amount of time. And if I just embrace it and do it, the finish line will be there. The finish line is there. But if you want to cross it with any amount of grace or style or good timing, then you have to embrace the training. And that's just how it works. Hard things.

If you want great things, I promise you, you're going to have to endure hard things. I don't care if it's athletically. I don't care if it's wanting to start a business and grow it and become self-employed. I don't care if it's, I want to go into ministry and touch lives and pour my heart out. You pick any endeavor, physical, emotional, spiritual, financial endeavor, if you want to be great or do something significant, forget great, sometimes we make great to, too, like, you know, oh, it's about great, great, great. If you want to do something significant, I can tell you, it's on the other side of hard things. Man, can't avoid it. You know? You cannot, it's unavoidable. Yeah. And it's like, sometimes we're like, oh, success and all the things. And we're helping people with money success, work success, success, relationship success. That's, you know. what we're about here. I'm just going to tell you something. I've been married 27 years. As James said earlier, God bless Stacy. I mean, the woman has had to endure some hard things to make it

this far, you know? I mean, it's just, it is what it is. But there's also, and let's break it down further, because there's the hard things that we want to do. Like we say, I'm going to go to school and I know that's going to be a challenge and I know it's going to, like there's the hard things we want to do. But there are then the hard things we don't want to do. And those are part of it. And I think that's really the main. You know, where disconnects is like, wait a second, I knew I was going to have to do hard things, but nobody told me I was going to have to do hard things I didn't want to do. Correct. Yeah, it's like going on that training and everything or I'd rather have been home watching football, elbow deep and

some salsa. You know what I mean? Yeah. I mean, that's what I want to do. But nobody wants to be out there pounding the pavement, putting the effort in. So back to this situation, especially young couples or young people coming right out of this. I got this degree. It's such a huge accomplishment. I don't want it in any way downplay. And you think, okay, I just did all this work. And now what? Now what is I got to pay it off? Or else I'm going to be miserable. And you can't just go, well, I applied to all these different places. I got a part-time pharmacy thing. No. Okay, I'm in. Now I got to go in. I've got my foot in the door, but it's not a great gig. So now I've got to go work four other jobs to be able to take care of my wife and I, who she's in grad school.

Like, this is the reality. So I wish we again had an easy fix, but we don't. Work the baby steps and working the baby steps. It's a simple process, but it is extremely difficult. Hard hats are required. All right. Are you staying on track with the baby steps? If you'd like to know where you are, how you're tracking, take a quick quiz, and you can check

your progress and get a personalized plan to keep that momentum going. You can head to our show notes and click on the link. Are you on track with the baby steps? Complete the quiz and it gives you a really fun update and some great inspiration. Austin is now joining us in Florida. Austin, how can we help? Hey, how are y'all doing? Well, we're having a blast today. What's going on with you? Good, good. Hey, listen, so I was up at the bank the other day and I was just just moving some money around and whatnot. I've been trying to get out of debt. I've been doing very good.

Over the last 11 months, I paid off $22,000. Wow. Good job. Yeah, so I've been trying. I've got, you know, $8,900 left to go. I'll be completely debt-free. And the lady up there at the bank was telling me I need to get a credit card to get my credit score to have reoccurring payments on my credit

so I can get a house. because I'm looking, you know, in the next two years to get a house. And I've been working the Ramsey plan, and I don't want to go for the credit. But I'm stuck right now because I'm so close to having a good credit score, opposed to having no credit score. So I need somebody with a little bit of a better opinion. You need to listen to Jade, not the nice lady at the bank. Yeah.

The nice lady at the bank has ulterior motives, no matter how sweet and bubbly she was. and I can just picture her. She was probably just a sweet of sugar. And she probably had a lot of credibility because she swayed you a little bit. She kind of knocked you off balance a touch. So glad you called today. And I would like you to never listen to that lady again.

And I'd like you to listen to this lady. So with no further ado, take it away. She probably also had a set of assumptions that you would go to that bank to get the loan for your mortgage one of the time is. I think that's what she was doing. So she thought. She thought. Listen, you already know the answer.

Austin, I can hear it in your voice. But for you, and really more so for the benefit of folks listening, Austin, you know, if you've been hanging out with us for a little while, you know we teach all the time. The credit score is not necessary. And I'll reiterate that with you again. I get it. Society teaches us this from a very young age, right? We're just bombarded with the message, right? Never leave home without it, right? And you're actually scared to leave home without your master card, right? So I get it. But I like to remind people that the only reason you're hearing that message so much is because there's money on the other end of it, you know, for businesses and for banks. What we teach is

actually just as true. The truth is, yeah, you can have a great credit score and go buy a house. That is true. There's no falsehood to that. But it's also true and just as true that you can have a zero credit score and go and buy a home. And America needs to know this, right? There are companies that do manual underwriting, which say, hey, we're not looking at a credit score. We're simply looking at how you manage your money. And that does exist. So in that way, having a zero credit score or an indeterminable credit score is the same. It really, it's better than having a good credit score because it doesn't have the stress and the debt attached to it, right? And so that's how that happens. You pay off all the debt. And in six to eight months,

for some people maybe 12 months, your score rolls to zero, which means we can't find it, like I said before, indeterminable. And when that happens, now is the time. That's when you can strike, right? If your score hasn't rolled away yet and it's low, yes, you're going to have a problem. But once it hits zero, that's the sweet spot of when that happens. And we would always recommend Churchill mortgage to you. They do mortgages and the majority of the United States. So yeah, it could take a little due diligence. You hop on their website, do a little research, get connected with someone, and start making your plan. And all they're going to want to know is what we're all kind of used to. They're going to want to know your pay stubs, right?

Show us your pay stubs. They're going to want to know, you know, can you keep the job? How long have you been at, you know, getting paid? And maybe if you're, you know, a small business like Sam and I were, they might want to see your tax returns, your business tax returns. That's fine. And then they're going to want to see your trade lines. Have you been keeping up with your cell phone payment, your utility payment and they want to see proof that you've been paying rent. And that's really important for folks who are living at home. Make sure there's some paper trail to show, hey, I've been paying rent on time, even if it's to your parents. Just make sure you're documenting that because that's really all you need. And then from there, it's basically the same process, Ken. That's right. Exactly

right. So this is a myth that she just busted and hope you get it, Austin. Stand strong. You're going to stand strong and just smile and wave like the penguins from Madagascar. When people hit you with these things, I mean, you know better, don't you? Yes, sir. All right. So you just got a master class. You don't need a credit score, do you, Austin? No, I do not.

That's just, I was stuck because I didn't know if I needed it, you know, within the next two years or not. That's why we're here. Another quick question. Okay. Another quick question is you got just a second. Well, it's got to be fast. We've got other people waiting. What's going on?

Right. The next question, my bank. So I don't really want to bank there, but it's the closest one anywhere around where I'm living at. And the fair winds is probably an hour and a half away from where I'm at. What can I do with that? What's causing you to go into the bank all the time? Because I feel like... So like my rent and everything is cash. All that's a cash deal right now. Why? So to get to get just because where it's at, I'm renting out some property. And we pay the landlord cash.

so we're saving up to get out of debt. So everything is like a more responsible cash deal. Well, I just, I don't know why you have to pay cash. I just, I don't understand that. Let's talk about that. So if you're doing cash as some sort of an envelope system to try to just like keep your piles of money separate and manage it better, that usually works better for things that you can easily pay cash for, like groceries or maybe gas or things like that. But I do find that things like rent or car payments, it is more convenient to pay for them online.

So unless you're receiving like your income as cash and then you would have to deposit it in the bank anyway. But if you're receiving your income as direct deposit, I would recommend keeping it as direct deposit. That way you can bank out an establishment that you feel good about and do most of it online. Yeah, and fair ones can take great care of you. I mean, I'd call them. Call them and go, hey, I live an hour away. just let them walk you through it, but I don't know that you have to do that. And I just personally, I know it's 2025, I just...

Cash? You got a problem with cash, Ken? I don't have a problem with it, but pain, it just seems really inconvenient. When he started off the call, he's like, I was at the bank the other day and I'm moving my money around. I was like, did you go see, you know, the mercantile and get your eggs while you were there? It felt a very... The general store.

Yeah, it felt like I'm not sure this is the best use of our time. Yeah, that's a good point. That's a good. Now, I will say, if you are on Baby Step 2 and you're really trying to be on it, I do love cash for that purpose. But again, just for, like, use it for the groceries. Small stuff. Yeah. For the budget buster things. Yeah. Rolling up with a lot of cash. I don't know if I feel good about that. Yeah, that's, nothing fundamentally wrong with it. No, there's nothing. Well, his problem is there's no bank. Right. And I'd love him to be with

Fairwins. Yeah, I would too. And so, you know, if he's not having to drive, I can't remember the last time I had to go into the bank. I try it at all costs not to go into the bank. I try it at all costs not to go into the bank. Yeah, they're never open. Have you noticed that? Actually, they are more now than ever, I feel like. It used to be like on Saturdays they'd be closed, but now they're open. On Saturdays?

I think so. The banks are open on Saturday? Everybody's shaking. A lot of times it's like until noon or something. Yeah. Yeah. Listen, I just remember the days. I'm definitely not going to the bank on a Saturday. I promise you that right now.

There's too much football to be watched, especially this time of year, you know? No comment. No comment. I'm not, you know, I need to. get into the football game. I haven't, let me, yeah, I mean, I can't even tell you. Yeah, all right, very good. Anyway, the point is that much cash, big transactions, a lot of cash.

I just, you know, I don't know, I'd be careful. Rent feels like something you should pay online, let's do it like that. Yeah, and it protects you, you know, the online, the banking for everyone's credit, you know, there's protections in using online banking, which I like. Yeah. You know, and I'll tell you where I do like cash when I'm buying a car for the kids. Oh, did you just slap it on there on the table? My favorite move is the accordion.

What say you? I call it the accordion. I lay it out on the hood of the car that I'm offering. That is gangster, Ken Coleman. I think it kind is. I'll receive that. Because you're making an offer, right? Oh, yeah, for real.

They're asking this. I don't want to pay this. You just silently put it out there? So I pull out the envelope and I do this number and I just kind of count it out on the hood, trying under the guise of being accurate, but it's a hidden flex. Y'all don't know that, Ken. I said, gee. I'm telling you.

That's how I bought my last kid's car. Nice old lady, counted it out for her. Take it or leave it. What is she going to do? A whole lady. Make you an offer you can refuse. Welcome back to the Ramsey show in the Fair Winds Credit Union Studio. Alongside Jade Warshaw, I'm Ken Coleman.

Steve is now joining us in Columbia, South Carolina. Steve, how can we help today? Yeah, hi, Ken. Hi, Jay. It's great to be speaking with you guys today. Yeah, too, to talk to you. Um, so I've got a, uh, uh, I'm on the cusp of finalizing a divorce and we came to a mediated settlement. And as part of it, um, basically there's a 50, 50 split of the 401k, but then I also have to come up with 100,000 cash in 90 days to buy her out of the house.

And then additionally, there's 150K, um, lump sum, alimony payment over five years. So kind of two questions is basically, how would you guys recommend coming with the 100K? because I got some advice from the lawyers and I didn't really appreciate and clearly they weren't part of the Ramsey program and then I'd treat the alimony payment going forward I treat it as a debt in the baby steps or as like a light item in the budget going forward

Why don't we address that one first Jay tell him about where that goes in the budget? The 150 over five years have you calculated it out and seen what that looks like monthly? Yeah, so about $2,500 a month. Can you afford that? and it fits yeah okay good so yeah that's a line item on the budget um i would do it that way especially if you can afford it what's your income uh about 180 a year okay good so it ends up being about

about like eight eight thousand a month okay okay so the 100k and 90 days to buy out the house yeah why'd you agree to that uh uh so it's it's definitely definitely the house uh it's um In terms of everything else available in the area, there's, there's no way I'd be getting anything close to this. And, um, but I'm talking about the term, the time. Like, do you have a hundred, do you have $100,000? Yeah. So that's exactly it. I think, I think it is a matter of kind of signing it and not really paying attention to that 90 days. Um, I've got about 50, 55K in cash right now. Okay. Well, that's a good start. How much is your car worth? so not much so it's a 2007 Subaru Forrester so what happens if let's come at this thing from another angle just I'm trying to figure this out for you what happens if in 90 days you don't

have 100k what what is the kick in in the contract what the agreement uh so it's just part of the court order so I think it'd be going going back back in front of the touch I think that's your best bet you this was a this was a bad negotiation on your part or on your lawyer's part because you don't you can't get the money at 90 days and so when this goes back in front of the court you need to have a better plan of what that is um why why not sell i was going to say the original well the the original thought was uh basically kind of part of the quadro from the rest of the 401k so my half of the 401k used part of it to be able to pay her off that was your plan that was the that was the original thought

And then again, the lawyers even suggested doing a home equity loan, which I flat out just rejected. I thought that was a bad idea. Because you have to put yourself, you have to reverse engineer, like, you have to reverse the situation and say, if I were in any other setting, would I borrow from my 401K to buy a house? No, you wouldn't. Would I take out a personal loan, you know, to up the Annie on my house? No, you wouldn't.

And that's the way I'm looking at it. I think that you either need to give yourself more time if this is like something that you're like, I love this house, I don't want to give it up, I'm never going to have a house like this again, you either need to give yourself more time. I mean, I've talked to people where there's years to come up with the money.

Not that I want you link to her for that long, but... Do you have kids? Adult kids, so she's in college now, but yep. Okay, so where's your ex going? She's just going to go rent somewhere? Starting a new career or another state. Okay. I'm going to come back to this because I, now again, I've never walked through this before, so Jade and I are kind of on the same page.

Well, I'm thinking about you could do maybe a cash out refi. I don't know if there's, because you have to take her name off it anyway. I would sell the house and do you have any equity in it at all? Yeah, and that's basically what I'm buying, buying out of. How much equity do you have in the home? About $200K in equity. So why wouldn't you, I mean, I don't understand given that equity stake that you have. This is just a house and it's got a bunch of pain attached to it. You are single. You got all this money that you're going to have to pay out over five years. I personally, and again, I don't know what you think about this. I view it a little differently. I know. I'm giving you another train of thought. I'm not going to advocate for my point of view. I'm going to say, if it were me, I'd sell the house.

Are there kids involved? Exactly what's been going on in my brain. To sell it? No, no, no, no, just back and forth. Well, like you said, there's a clean start in this situation. There's that, but then there's also, I mean, you did make a good point earlier where you said with the market and when you bought this house, you might not be able to get something like that again. And I do feel that if emotionally there's not the attachment that Ken and I think there might be. and you want to keep the house?

Yeah, standard is you would refi, get her name off of it, and then you would pull the cash out when you refi. And then she would get her portion. The only reason I kind of disagreed with Ken's sentiment initially is because the $100,000 is her money. It's not you giving $100,000 of your money. At this point, now that is her money because you're separate. So there's a different way to look at that.

It's like, I'm just giving her money. I'm not giving away my money, if that makes sense. right so that's if you want to do the 90 day deal that's how you would get it um but ken has a good point do you really want to be in this house or is it worth it to you to maybe get less house and have a fresh start that's the question only you can answer that yeah or rent for a bit i mean your life's not over so yeah i i definitely know that starting starting over but yep yeah it's not over it's starting over and so there's a whole lot of new things coming your way So, again, I don't want to advocate for it.

That may be too aggressive. How long were you married? 20 years. 20 years. Oh, listen. Ken may have a point. The kids? Do you have kids?

Yeah, remember they've got the... Oh, that's right. That's right. Is it just one? College. Yeah. Just one. Ooh, yeah.

You got your work cut out for you in terms of sentimental thoughts versus fresh start thoughts. I mean, you make a good income. I've been working through those. You make, here's, I'm not advocating. I am going to say, because I like when you push back. So keep pushing on this. But in your shoes, if you sell this house, then you're able to pay her, her money and have that done. Set aside, put it away, get it over with.

That's what I would do. I would want a clean break if I could do it. And I'm just looking at the numbers. You're going to have to pay her $100,000 in 90 days. And then you got $150, which is alimony, over five years. Um, that's a lot of money coming out of your pocket. It could be nice to have a smaller. And I'm just saying I might rent for a year, reset my life.

I don't think renting for 12 months is a bad idea for a guy in your shoes. Get rid of the house. Move on into a new chapter of life. And another, okay, I'm going to throw something else in there. And this is soon. So don't, don't be mad at me. But you'll move on at some point and meet another lovely lady. I'm expecting that.

And do you want to bring her into that house? or do you want to bring her into, you know, fresh start, Steve? Yeah, so we'll see about that one, but sure. I know I jumped ahead, but do you see what I'm saying? Like, there's, begin with the end in mind is what I'm saying. Yeah, I don't know. I don't know why I feel that way, but that's what I would do in that situation and just start fresh. You're not wrong, Ken. Start fresh. Get her to the $100,000.

That's her money, to your point. And now work on the rest of it. Oh, divorce sucks. I hate that for you. Yeah, me too. All right, let's get a Chris who's joining us now in North Carolina. Chris, how can we help today? Hey, how are you doing? So, yeah, I got sick before COVID, and I was bedridden for three years and went to a financial problem real bad and lost my business,

had credit card debt go crazy, and a couple years later now it's coming back to hauling me, I just now was able to start working again. literally two months in, and I've got, haven't been served yet, but they're trying to serve me with judgment. I don't have any assets before all this happened. I turned my house over to my wife and my property number to daughter, so I have no assets to worry about that. I guess my question is, should I go through with a bankruptcy before I meet the salary, yearly salary requirement to do so, or should I not do bankruptcy and wait to see what happens? Short answer is we're not doing the bankruptcy, but tell me, give us more context.

What caused you to be sick for three years? Is that over and done, or can that come back? It's possible. I had Lyme disease, and I didn't know that I had it. I was undiagnosed, and then when I got COVID, it dropped my immune system enough to make both of them a problem. But by the time they found it, it went to my heart, my brain, and I had to be on a year of treatment. And I was still just about two years, I was completely better, and then just slowly started getting better. And your wife, did your wife leave you during that time? You said you left that gave her the house. What does that mean?

No, no, no. We're not legally married. So we're, so luckily for her, she doesn't have to deal with that financial part. Now, we've been together this whole time. So you're living with... Why did you call her your wife? Yeah, I'm confused. What's that?

Why did you call her your wife and then just tell Jay that you're not married? Well, I guess that what would you call a significant other then? A girlfriend? That would be the proper terminology. I just say wife. Okay. I'm not trying to get too technical. I didn't know if there was another part of the story that we needed to know about.

So, okay, so your significant other, you've been together. their long time. Everything's in her name is what you're saying. So you literally legally have no assets. Correct. Okay. So you've just gotten back to work. What kind of work do you do now and what are you earning?

So project manager and it's $130,000 a year. That's good news. And how much is the debt? Definitely. I think it's like around $70,000. thousand, something like that. Okay. So first.

Some of his credit cards, some is loan. Okay. So first, your homework from me tonight anyway is I want you to go and find out exactly how much you owe. I want you to have it written down. This much is credit cards. This much is medical. This much is, you know, personal loan.

So you get a sense of what it is and the amounts because the way we're going to attack this is what we call the debt snowball where you list them smallest to largest and you pay minimum payments on everything and, you know, put it as part of your monthly budget. And then whatever money you have left in margin, which is your extra money, all the extra money goes to the smallest debt. So let's say you have a medical bill and one of them's only, you know, $800. You could essentially knock that $800 bill out in one shot. And then, you know, you just keep working through them like that. So $130,000, that's great. That's a great income. I'm going to let you know right now. What you've shown us, aside,

from the medical part because that makes this feel very different. But the numbers alone, I mean, I want you to feel good in this case about being average because this is really just kind of your average debt scenario. You got $130,000 income. You're paying off 70. Yeah, you're going to have to live on not very much. Maybe you live on 80 to make this happen quickly, right? And the average person is out of debt in about two years, two and a half years. So that's where you're going to be with this. And, yeah, are you, I got a couple of questions, Chris, but are you tracking with Jade? Somewhat.

What do you not getting? If you live on 80, that frees up 50,000, and I know taxes and all that, but do you see what I'm getting at? No, I understand that. I guess when you talk with two different attorneys, I'm getting, you know, three different opinions. I've got, you know, bankruptcy attorney saying, hey, do bankruptcy. another bankruptcy telling me don't be bankruptcy because you have no app to

North Carolina it's very rare for them to garnish your wages if they can at all so the worst you're going to deal with is judgments that may come back to haunt you and we've got another bankruptcy attorney says why wait why wait until you make that $130,000 because North Carolina as soon as you hit that $50,000 you can't do Chapter 7 so why not do it now let me tell you my to get all the debt behind you. My reason is when once you file bankruptcy, you're going to lose your, you lose control over the situation.

Yes. And now a court says, here's what the judgment is. Here's what you have to pay a month. Here's what it is. Here's what will take. You have no assets. But you said I'm saying you lose control over the situation. And there is a, there's an emotional component that's going to go along with that, that says that it's

basically you signing on the paper that says, I lost control. I'm not fit to handle this by myself. here, you guys take it. That's going to take an emotional toll. Not only on you, obviously, it's going to decimate your credit. I'm sure your credit's already bad, but that's going to take seven years to fall off your credit. So this is going to haunt you when you can look at the situation and go, actually, there is some agency and some autonomy that you can take over this and you get to decide. You can say, you know what, I made a mess. And instead of losing your confidence, you can build your confidence up by cleaning it up one debt at a time. And that does something for you

as well. When you take control of a situation and you clean it up and you make something wrong right, that's building something in you that at this time in your life you really, really, really need. Yeah. Listen, you've been through it. Amen. Yes and amen to everything Jade said, Chris. And I agree with one of the bankruptcy lawyers that you shouldn't do this for all the reasons she just gave you. The thing that I'm concerned about for you, you've had your life turned upside down. And man, I hate that for you. Man, I have so much compassion for you. But I think it, as it would anybody, Chris, it jaded you or it shaded some of your perceptions about what you should do.

The fact that you are living with a woman that you refer to as your wife and you signed a house over to her that you bought, am I understanding this correctly? Correct. Brother, that needs to change. Do you want to be with this woman the rest of your life? Yes or no? Oh, yeah, absolutely. Is there a reason why from her that you guys aren't married? Is it her or is it you?

Well, religiously we're married. We went through all of that. So, I mean, we're family, all that. We just didn't. What do you mean? You got a marriage license? What do you mean religiously you're married? So we went through the ceremony, but we never did a certificate.

So in North Carolina, technically, we are married as far as, you know, North Carolina, when you're living with somebody for seven years, you're leaving married. Common law. Okay. Common law. But as far as- So why not go down to the courthouse today and get the union? Well, no, hold on.

Finish that sentence. I want to hear this reasoning really quick. The IRS, the government, finish that. Yeah, as far as, you know, doing the marriage certificate and IRS and all that, in fact, we are, we file separately. We're separate. We're not legally married. Yeah, I get it.

My point is you signed your house over to somebody. don't know where that falls in North Carolina law. I don't have time to figure that out on this little bit of a call, but that needs to get. A, yeah, yeah. You need to get that. That needs to be fixed. Like, A, don't file bankruptcy. B, get the house back in your name, if that's even possible. I guess. No, no, dude, this is not something to chuckle about. I don't think you get out. I don't think you get help. The concern is what's going on now. The concern is what's going on now is that, that, you know, going out, you know, we've got credit card and bank. Yeah, Chris, the first thing they tried to do for assets, right, but lean on the house.

Here's what I think you did. Here's what I think you did. And I, I'm not trying to make a bad situation worse, but I have a sense that you guys capitalized on the fact that you never got the marriage certificate when you saw that it was about to start pouring rain on your situation. And I think you transferred that house over to her name. I do too. And if you keep evading this, it is going to follow you. You've got to. deal with this. Dig out, bro. Stop trying to move stuff over here and move it over here and do the bankruptcy.

Just deal with it. We've seen people do this, Chris. And you've done all these kind of little maneuvers and you think it's funny. Hey, you call it us. I'm going to tell you something. What you're doing, there's nothing funny. It's scary. All right, our Ramsey Show question of the day is brought to you by Y Reefi.

Defaulted private student loans can drag on for years. But Y Reefi helps borrowers. explore custom refinancing with a low fixed rate and a payment you can actually manage. Go to yrefi.com slash Ramsey. That's the letter Y-R-E-F-Y.com slash Ramsey. Not available in all states. All right. Today's question comes from Chelsea in Idaho. She says, my daughter recently graduated college and we will be traveling for the final step of a job interview soon. She's already passed the first three steps in the process. Is it ever okay to request your expensive?

be comped by the company you are applying to? She estimates the airfare, Uber, hotels, meals, and three days of missed wages at her current job will run her roughly $1,000. This would make a huge impact on her monthly budget for a job she doesn't even have yet. Would it be inappropriate for her to email the company and ask for reimbursement for at least some of these expenses? Yes, it would be, well, wildly, wildly silly. Not even inappropriate, just silly. You're guaranteeing she doesn't get the job.

And Chelsea, I'm honored you sent the question to us, but the fact that you're asking us this concerns me. This is Entitlement 101. You are not entitled to your expenses for applying to a job. If your money's tight, it's not that they're fault. Oh, my goodness gracious. By the way, this is the world we live in where parents are showing up to job interviews, and then the kids are complaining, Mom, it's going to cost me $1,000. She goes, I'll tell you what, I'll email the Ramsey show people and see if that's appropriate.

It's not appropriate. It's called the cost of living. I'm mildly irritated right now. Get all the way irritated. I want to see what happens. I don't want to. God bless you for the question, but no, please don't do that. to her why. I'm not sure you know why. It's not done. It's unreasonable. This is you trying

to win the job and you're competing against other people. And you don't say, hey, this cost me a thousand bucks to travel here to apply. They're going to go, we don't care. And we don't want you here because you're too soft. And you're already causing, you're already drama. Let me tell you Ken, 101. This is just from being an entertainment. When I used to be an entertainment, my agent would say just show up and do the job don't be drama if you're a drama you could be the best on stage but if you're a drama they'll never have you back like just go it could be the worst room ever and go this is such a nice place thank you for having me like everything is a graciousness not hey you know the m&Ms were a little bit uh there were too many red ones in the dish

could you this that's what this is there's too many red m&Ms in my dish and you got it you when opportunity knocks can you have to be ready to answer the door that's on you i just looked in the drawer over here i thought maybe there'd be some tums i got a little indigestion right here on that question right there you know what i'm talking about people in the lobby you know what i'm talking about it's going to be a little something there yeah she got it are you for real she got the tums right lady late james she just reached up with a bottle of tums so fantastic by the way i do not endorse them uh it's just a fun joke All right. Jane is up in Washington.

Jane, how can we help today? Hi. So about 10 years ago, we took the Financial Peace University, sold the SUV, got a minivan instead, and worked our way up to step number four. Life happened, and we're back down at step number two. With the number of emergencies that we have had in the last seven years, I want to be stockpiling money. I want to get that six months of income or of household needs saved up before we tackle the debt that we had to take on a couple years ago.

Okay. Well, let's go ahead and head that idea off. That's never something that we would recommend, and Jay to walk you through why. But let's first get a picture of where we are. So at one point, you were working the baby steps and you got the baby step four. And now all these emergencies, you're saying the emergencies, are responsible for the debt, and if that's true, how much debt do you have now? We only have $9,000 in non-mortgage debt right now.

Is that on a credit card? No, it's a personal line of credit for we had to have the siding replaced. A storm came through, damaged both our roof and our siding. You didn't have insurance? Hello? it couldn't even occur to me to go through the insurance when we did this four years ago. The house was livable, but the roof was leaking and the sighting was damaged enough on one wall. Did somebody make the whole thing?

Are you sure or did somebody make the decision and say we don't want to submit this claim because we don't want our premium to go up? And so we'll just take out debt. So my husband and I are first time homeowners. neither of our parents ever own their homes and I guess in the discussion years ago when we were having that maybe it was part of the we didn't want the premiums to go up

that feels right but this was yeah so the $9,000 on a credit card is solely based on you've mentioned several emergencies so what emergencies are coming up in your life that have put you in a position where you believed that you had to do $9,000 worth of credit cards Well, we had one child who was failure to thrive, and for two years I was unable to work, taking care of that baby. Okay.

We have another child who is special needs, so the one who is failure to thrive is doing fine now. Okay, great. But we do have one who has some special needs, and that impacts my ability to work. Okay. So we went from two incomes to one. Okay. What's your household income? The credit card, we're hoping to hit $100,000 next year this year.

My husband was laid off this year, three months out of work. Okay. But with his new job, he'll be $100,000 next year, but not this year. Okay, great. And are you able to work outside the home? Not outside the home, no. Okay. I do some work online and bring home about $6,000 a year.

Okay. And so, okay, so I want to give Jade, I want Jade to answer the core question as to why we would not have you work on Babysept 3 ahead of Baby Step 2, which is only $9,000. And I know that may seem like a lot, but in the grand scheme of things, Jade, it's very doable. Yeah, so I just want to make sure it's just the two kids or are there more? Just too home now. Okay, two home. I think life has hit you with a lot. And because of that, it's kind of inflated the feeling of the debt more so than it is.

You mentioned before that, you know, it took seven years. You know, you've been in this for seven years. And so I just feel like there's been a lot that's happened that much of it has not much to do with the debt, but it all kind of is conglomerated together in your mind. Because when I look at this right now, I go, oh, $9,000 of debt, why isn't that gone in two months? because if you do the budget our household our household needs are high enough

that help me understand why because what it sounds like is help me understand where that is because what I'm hearing is in a generalized situation rent is usually the highest or mortgage is the highest

and then the second highest thing if there's kids is some form of daycare and usually that's those are the two that are kind of causing things to be really tight because your debt's not the problem The $9,000 debt is not what's breaking you. Is there something more in the equation that you're not telling us about?

Are there cars? Is your mortgage a crazy amount of your take-home pay? No. So food and medicine. Oh, medicine? Yeah, we have certain medications, you know, insurance covers so much. But, yeah, between food and we're not in any medical debt. Tell me right quick.

Tell me right quick because we're up against the clock and I'm sorry, but tell me what you spend in medication and tell me what you spend on your mortgage. We spend $1,500 a month between food and medicine and $1,200 a month on the mortgage. Okay, this shouldn't be a problem. I think that you guys need to get on a really, really tight budget. I love that you know your numbers, but pay that $9,000 off. It's going to take you two to three months to do it and then stack up as much money as you want to to keep the big bad wolf away from your door.

Hey, everybody. You need insurance. And nobody really likes digging into insurance, right? You know you need it. George does. George kind of does. Outside of George, nobody does. But we know it's hard to, it's hard to figure this out. And that's why we have our Ramsey trusted insurance pros. And you're never going to deal with sleasiness, salespeople. We've vetted. them. They're going to coach you up. Make sure you get what you need. And you can find them by going to ramsysolutions.com slash coverage. Ramsey Solutions.com slash coverage. And you can connect with a Ramsey trusted agent or you can click on the link in our show notes. All right, Doug is up next in Connecticut. Doug, how can we help today? Hey, how are we doing today? Good. How are you, sir?

Excellent, excellent. Thanks for taking my call. I got two questions. The first one's a real simple, quick yes or no, I hope. Anyway, you know, Dave talked about doing 15% in retirement after you're completely debt-free besides the house. That's 15% my company does a 5% match. So is that 15% like 10% that I put in plus the 5% is 15% or is it 15% and whatever the company matches is added bonus basically. Yeah, typically we think of it as whatever the company adds is the added bonus. And that's just the reasoning for that is if for some reason you went to another job and they didn't have that bonus, you would still be in the rhythm of giving 15% of your income. Like, that's just a great way to do it. And since you're debt-free, except the house,

like, if you wanted to go above 15%, you could. And I think it's a good idea if you do. Totally. Yeah, absolutely. Okay. So the main question, thank you very much. Appreciate that. That answered a lot of questions for me. So the situation, FPU graduate 13 years ago, I just started listening to the podcast like two months ago and rediscovered Dave and I've listened every day. So love you guys. Thank you. very much. Downloaded the Every Dollar app literally three weeks ago. So my situation is this.

I have $23,000 in an emergency fund. That is my, that's about five months of expenses right there, $280K in retirement, which I recently stopped contributing to. I have zero credit card debt. I'm single. I don't have any kids. I make about $140,000 to $160 a year, take home. I take home about $6,500 to $9,000 a month, depending on the season.

You know, winters are a little slower. Um, I do have a mortgage, but I, uh, failed with the car. Uh, I got a car literally a year ago, um, financed it. Um, however, I got, I took a three year loan on the car and they were offering zero percent. Okay. So I figured, oh, I'm going to beat, I'm going to beat these guys up because, you know, I got zero percent, right? You know, it's payment is $1,000 a month, um, which is comfortable. I can get by, but I also get a $600 a month car allowance for more, right? To go towards basically whatever I want to put in. Thank goodness. So in my head, I'm thinking, $400 a month out of pocket, no sweat, it's all good. But like I said, zero percent. I currently owe $26,000 on the car. And with doing the every dollar budget app, I literally last month found an extra $140 of, you know, extra income. Great. Which I already put towards the car.

So I'm down. I want to get rid of this car. I just, with a 0% loan, I can't see how, and a lot of people can't see how it makes sense to take my money that I've been saving up $23,000 for, the last, God knows how many years it took me to get there. Sure. Why did it take you so long with this great income? Did you have, you're single, yes? Yeah, I've been a girl friend, but yeah, single, yeah.

But why did it take you so long? Or is this new, is this income new? I mean, no, income's not new. I've been with the company about seven years. And I say the last couple years, I've built my book of business. So, you know, definitely, you know, the income's been growing year after year. Okay. Yeah.

And like I said, I just, I had a car that was paid for before I got into this car. But I'm 45 years old. I'm 6.3, 250 pounds. So a nice little, little cars not doing it anymore. So I needed something a little bigger. So I went with the SUV. Right. So wait a minute.

Wait a minute. I've heard a lot of reasons for keeping a car. I think that's the, I think that's the one. You act like you're an NBA player. You're not that big. Yeah. I think you like, listen, I think you like the fact that you got zero percent interest. I think you like the fact that you're.

job is kicking in the $600 a month and you're like, hey, what's the big deal? It's $400 a month. It's for three years. Do I really, Jade, have to, you know, Ken, do I really have to pay this thing off? And here's where I, I'm just going to tell you where I see risk. Where I see the risk is if you got fired tomorrow, you'd be on the hook for a car loan and you'd be on the hook for the whole thousand dollars. And I'm always going to tell you to go the path of least beneficial risk. Like there's times where risk could be beneficial, right? You, there's, a certain amount of risk that you take when you take out a home mortgage, right? But the benefit outweighs the risk. In this case, there's risk there. Do you really need it? Is it going to affect

you? I think it could. And I think that you could easily pay this thing off and just be like, you know, give the finger to the whole thing and just say, I don't need a payment at all. I have money. Bye. Bye, by Felicia. And just paid off. Yeah. And I agree. And at the end of the day, like I said, I just started the every dollar budget. So I'm sitting there like, if I could literally find an extra three, four, five, and I probably would have found more money, but I had two vacations last month. So at the end of the day, I could easily probably find an extra $5, six, seven, $800. Who knows, you know, at the end of this month and throw it towards the car.

Now, well, let me tell you what I do. Let me tell you what I would do, Doug. I would go to my employer and I'd say, you guys are giving me the $600 bonus, which I really appreciate. I love this money. It's so helpful for me. I'm planning on paying off the car. I did the math, and I found out that if you paid me the $600 over the entire length of this car payment,

it would amount to X amount of dollars. Is there a way since if I, if I proved to you that I paid it off in full, that you'll still give me that money as my stipend? That's what I would do. Is that fair, Ken? You're the... I'd want to do a little research before I took that proposal to them. Because if they're going to pay it anyway? Yeah, I just want to...

Go ahead. Yeah, I'm saying the car allowance is more for like repairs, brakes, auto, because I drive my own car. I put about 25 to 30,000 miles on the car a year outside sales. So they'll give it to you anyway. They give it to me, oh, I'll get it anyway. Yeah, if I have no car payment, I'm getting that money regardless. So, Doug, you called us, I think we're talking all the way around this thing.

Doug, we're dancing all around this thing. You called to say, what? What was your question? Your core question. Should I empty my high-yield savings account, which is where my emergency fund is where I'm getting four percent of interest. and just basically dump it, maybe minus the thousands to keep my emergency fund. Yes.

It's like you've listened to this show before, though. Yes. Yes, Doug. How much do you have in your emergency fund? 23,000. And how much is to pay off the car in full? 26. Do it.

Done. And then you build the emergency fund. Back up. You've got a great income and you're single. Stop the vacations, man. You're living high on the hog, buddy. You know, you could build this. You're golfing.

Yeah. Like, I mean, listen, that's the plan. You empty it out. You say, if $1,000, so you're going to have $1,000 in there. You're back to, you see what I'm saying? You pay the car off. Absolutely. And now you're back to Baby Step 3.

You get the three to six months. And now you can go back to, you know, your vacation, single guy and all that. This should be an easy fix for you. Easy fix. So I agree. And it was one of those things where I've been, since I've been listening to you guys, like I said, I rediscovered the baby steps, rediscovered. ever day than I had I basically went from babysit one to three back to two and you know

listen you need to discover yourself without a car payment yeah yeah you're playing financial twister you know right hand on red you know left foot on green no we don't have a financial twister plan we have the baby step plan and you just got to follow it and here's the good news for you Doug like you have the means to do this immediately and now you got yourself a paid for a car how's that feel. That's a baller. Yeah, it's going to feel great. And an unbelievable deal from your company that, like, I would take that 600 a month and stack that. Yes. For any car replacement, anything. Oh, come on, give him that. Give them that. My computer's dead. I want you to go to Ramsey Solutions.com. I want you to look at

the investment calculator. And I want you to plug in. If you take that $600 and you just drop it in your investments for the next 20 years, what that's going to be. And your mind is going to be blown. Dougie, Doug. No, 100%. Yeah. All right. I agree. There you go.

Thank you very much. Yeah, thanks for the call. Don't overcomplicate it. You know, I hate to do this, but they're not my steps. Dave came up with them so I can refer to them and be kind of obnoxious about it. But, I mean, there's a reason why there's one, and then it leads to two, and then it goes to three. It's called a system. I mean, pretty simple stuff.

But I love that. I'm going to give Doug, by the way, the Caller of the Day Award for the Rack. of being 6-3, about 240. Is that what he said? I'm like, are you trying to get a date or keep your car? What's going on here? He's like, I've got to get a bigger car because I can't just fold up like an accordion in this sedan. Like the guy's a tight, like he's an NFL tight in.

Come on, man. On that thing, I should be riding around on a bicycle. I'm a little guy. Welcome back to the Ramsey show in the Fair Winds Credit Union Studios alongside Jade Warshaw. Ken Coleman. And we're going to go to Matt, who's joining us now in Fort Worth, Texas. Matt, how can we help today? Yes, sir. So as of this past Monday, I had a truck that I've been paying on for about two years. I had an auto loan for about $30,000 on it. I owe about $23,000 on it, and the motor blew up.

um it's unfortunately just a bad design from general motors um they've had issues with this vehicle or these motors um for substantial amount of years at this point um and i am now fallen victim to said bad design um it would be about $15,000 to have a motor replace um and I'm trying to decide if what's my best option for it um before I try to to go trade it in and then it would be upside down on it. You owe 23? Yes, sir. If you get the motor fixed, if we could snap our fingers and it was just fixed today and it was

paid off, is this a truck you'd be happy to drive for a while? And could you? The truck's in great condition. Other than that, does motor were to be fixed? There is a company that sells a motor that has the system that caused it. to have this issue in the first place, deleted, and that's the option that I went and got quoted from when I talked to the shop. Do you have the $15,000 in cash?

I do not. What do you have in cash? I don't have much. My girlfriend just finished school, and I was basically the primary provider for about a year and a half with us. Whoa, whoa, whoa, whoa, whoa. How old are you? About 30 years old.

You're 30. Okay. Compliment to you. You sounded much older. You did. You did. Why are you the primary provider for your girlfriend? You guys aren't married.

Is she 32? No. She will be younger than me. How old is she? She is 27. You really don't know how old she is? You had to think about that? That's kind of funny to me.

That's a different issue. That's a whole other deal. Okay. Different show, different show. but I'm going to go ahead and tell you. You probably need to be on top of that one. Okay, you should, so you need to come up with $15,000. What do you make?

I work in public safety. So last year I made about $70,000. I'm probably on track for about the same this year. And if you weren't helping provide for your girlfriend, it's just you, right? Just rent or do you own a home? me what's what's the situation there no it would just be renting my normal expenses and i'm sorry for following up on this is she able to support herself now yes she's working full time again she just started with the the school year jade i she works as a um a american sign language interpreter

and she started interpreting with a school yeah all right jade i don't know where you're at on this but i there's there's a part of me that goes because he's already upset down in this the trade-in option to me is just foolish. You're just not going to get anything at all. I'd rather see him working two, three, four jobs and come up with 15 grand to get that truck fixed. And then, and then you got to swallow the pill and pay it off. But if it's a good, if the truck's in good shape other than this defect, and again, I'm giving you the answer on what I would do. Well, yeah. I mean, if you roll out the numbers, if we looked it up and said, what could you get for this with the bad engine. I mean, what is it? What would you be your estimate? Do you have any idea?

Yeah, I've been shopping around with a couple different dealerships. I reach out to GM recently because, or I'm sorry, GMC, because they have the highest rebates and stuff right now. And what they say? GM would give me 9,000. Okay. And I mean, because if you think about it like that and then you add what you would have to kick in to cover the upside. down plus to get another vehicle do you see what I'm saying you're still shilling out $15,000 so that's kind of the numbers on it I can't see why you wouldn't just at this point hate it but yeah I don't think the numbers are good for you either way so it's do you want to keep the car and pay the $15,000 or do you want to get out of the car and get another

beater which I don't think you do I think you'd rather drive the more the nicer car of the two if you can just get the money I've tried that um you can't go into debt for this i'll tell you that like if you end up if you can't find the money and you end up having to go the other route of you know okay if you because here's the thing if you do a personal loan to get from upside down your numbers are going down and i can i can advocate for that right i can advocate for you getting out of debt and then having to get a beater car and taking out a personal loan to do that. What I can't advocate for is you taking out a personal loan to keep a $23,000 car that you were already in debt for. Does that make

sense? So if you can't come up with the money, you might be going down and value. But I'm sitting next to a person who with her husband, they had one car for how many years? A decade. So where there's a Will, there's a way, and what I'm saying is, is figure out a way to get where you need to get, and I think you can come up with 15 grand pretty quick, a single guy who's able-bodied. Now you might have to stop taking care of your girlfriend. Oh, no, that's done. I'm already assuming, because she's just your girlfriend. She's a grown woman.

You got problems. So taking care of her problems isn't your problem. You can't. You can't. You know, in fact, you guys have been, you know, playing house for apparently a long time anyway. So no date nights, no nothing. You got to come up with 15 grand stat. Did we lose you? No, I'm so there.

Yeah, it's a bitter pill to swallow. But I just think the way Jade broke it down is great. And that just, again, we're always trying to answer things like, what would we do if you're in your shoes? If you can get the money without debt, yes, keep the card. to your point, it's going to be a great car when you get it fixed. But you can't, you can't do debt. I can't let you take out $15,000 of debt and put it with a $23,000 debt. I can't let you do that.

And you should say that to yourself too. And go back and listen to this call, right? Don't come off this call and go, oh, I can't get $50,000. I'm just going to do it. Marinate on it because when you do, you're going to see, oh, man, the last thing I want to do is go from being $23,000 in debt, you know, to be. being $45,000 in debt. That would be terrible. I agree completely. Are you stunned? Yeah, I've tried going that route. I just haven't been able to find a place to be able to do that.

I initially did attempt to contact my bank to try for a personal loan because other than the faulty design, I don't have an issue with the truck. I enjoy the truck. I've been driving. I'm in truck for two years and it's been great. So then what do you think your option is? Because you're either not getting the car fixed or, listen, your other option is take the time, however long it takes you to save up the $15,000. And in the meantime, you're taking the bus and you're riding your bike and you're getting Ubers and you're calling up Leroy to hit you up for a ride.

Like that's your option. That's what I think you've got to do. Yeah. I don't think he likes it. that option. I'm not even sure you heard that. I went through that mistakenly. I think it went in one here and out the other. Listen, it's not fun. That's why. It's not fun. All right, folks, you've been paying attention to the news. You know the Fed just cut the rates

for the first time all year and the 15-year fixed mortgage rates have dropped to the lowest we've seen in 11 months. If you're financially ready, now's a great time to buy or sell. Why? Some of you're going, Ken, I'd like to play the market. I'd like to see the rates come down. Can I just give you a little opinion here, a little off-the-talking points opinion? Yeah. Thank you. Yes. Here's what could happen.

If mortgage rates continue to have a slight drop, you're not going to see it, in my opinion, drop back down on the twos. But if you have a slight drop, here's what's going to happen. People are going to get back in the market. And as demand grows, guess what else is going to happen? House prices go back up. So for some of you are going, I'd like to see that rate drop. I'm playing the rate game. What you don't understand is as rates drop, housing prices will go back up.

It is supply demand. So I'm not pushing you to buy right now, but even though these rates are elevated from where they were several years ago, oh, I'm telling you, Jay, it's just supply demand and it never fails. Reminds me of a song. You're not going to get this one. had to make it to the top just to see how hard they drop. Yep, nothing. No, nothing.

Forrest Frank, no one? Oh, well, okay, never mind. She got it. Thank you. There's a lady in the audience is clapping, Forrest Frank fan. I'll be honest with you. I'm a little embarrassed. I'm not even sure who that is.

That's okay. Is that bad, James? No, it's not bad. Okay. James knows everything about music. They overplay him in the church youth group, some kind of room. Yeah. Oh, it's a Christian artist.

It's a Christian artist. That's why I said it was a deep cut. Boy, oh, boy. Listen, he's doing his thing. Good for him. And it was a great analogy for your real estate. So here's the point. Now might be the time to buy.

Thank you, Jade. Folks, I never know any music reference. It's just, it's terrible. It was a deep cut, Ken. Yeah, I like that. But here's the point I'm making. Now might be the best time from a home price situation to jump in or to sell. All right.

So if that's you, on either side of that coin, you need a pro to help you. We have our Ramsey trusted real estate agents that are standing by in locales all across the country. You can find one for free at ramsysolutions.com slash agents. That's plural ramsysolutions.com slash agents. All right, Julia is up in Bend, Oregon. Julia, how can we help today? Hi, I'm honored to speak with you both today. Good to speak with you.

What's going on? Thanks. I have a two-parter for you. I want to make sure first I'm like budgeting appropriately and putting the right amount towards debt given my income and then with some upcoming fertility treatments on the horizon, whether that should be kind of cash flowed or do like a mini stork mode to stockpile some cash. I like this question. Tell us more. Okay, so let's see. Debt, I just have $12,000 on the credit card. It's me and my husband and that's the main thing. we're trying to get through. Next is the home equity line of credit, which, based on the amount, I'm putting that with

our mortgage. Great. Okay. So luckily, it's not very much consumer debt. I just feel like we should be able to pay off more and just things come up every month, it seems like, that hinder our progress. What's you guys' income? We make $144,000 gross and then taking home just under $8,000 a month.

And what we've been able to do is rent out some rooms in our house. And part of that HELOC was completing an ADU so that we can get some additional income. So we have about $3,300 coming in now just as of last month. In addition to the $8,000? I think that's going to be a big help. But yeah, that's all kind of new. Okay. So what's the fertility treatments costing you?

Are you cash flowing it currently or you haven't started yet? we've been cashrolling up to this point of it's just been like a five year journey unfortunately and we're finally at the time of like probably needing IVF or something okay um so what i'm looking at is my insurance thankfully covers up to $10,000 of assistance there but i have to meet my deductible of 3,000 so i'm assuming we're going to need more than that because IVF can obviously cost way more than $10,000. So I guess my question is, do I, sorry. What's the top end?

Like, if you were really, like, running it through, like, what's the most you could spend or that you would spend? Let me put it like that. I mean, I don't even know because it looks like it varies by state, but it looked like in Oregon, maybe like 10 to 15, hopefully not more than 20. Okay. You know, my thought on this is if anybody else called in and said, hey, we're thinking of having a baby and they became pregnant. Yeah, we would put them in stork mode. In your case,

becoming pregnant is the cost ahead of time, right? Like everybody else gets pregnant, then the cost comes. Your cost comes ahead of time. So I would still treat it the same way. I'm not going to tell you to wait to pay off debt to try to get pregnant. But I will say it must be done in cash. I think that this is you going in on a bet and you don't want to go into. dead on that because that that could add insult to injury right of like 3,000 so I guess that was my question is like do I stack up that three grand so we at least know when we're ready to start we have that or just cash flow that as we go which I think we can do if you can cash flow it I would cash flow it if you can do a little of both I think that's great if you can cash flow this fertility

and keep paying off the 12,000 I think that's winning if you're finding that hey we literally don't have enough cash to do both of these. If you have to put less towards your snowball, that's fine. If you have to cause it to pause briefly for a couple of months, I think that that's fine too, especially since you said, like, age-wise, you're getting to the end of this. I would do, I mean, if I were in your shoes trying to do what you're trying to do, I would do that. Ken?

Yeah, I agree. I agree. Yeah. I can't add anything to that at all. And listen, can I just say, on a personal note, I was listening, I was listening, Stacey and I went through your journey, and it's really, really tough and, you know, just hang in there. And these days of uncertainty can really eat away at you. So certainly you understand where you're coming from, but please don't make, and not to say that

you're planning to, but don't ever let the emotion drive you to a poor financial decision to put you in a bad spot. You guys walk through all of that. And so I just wanted to add that one little. I can't add anything financial advice, but as hard as it is, I just believe there. a plan, and I believe you're going to be a mama one day. And that's all I want to leave you with. Thank you.

Yeah. Yeah, that's tough stuff. You know, these numbers, you know, just you look at the data out there. And I just feel like I'm supposed to say something about this, not just to her, but to our larger audience. You know, we see the infertility numbers continue to kind of move up. That needle is moving up in the United States. And, you know, there's nothing harder for young couples who want to start a family to have that need, desire unmet. And it can be really tough. And so here's the point that I'm making. You can

really rationalize, Jade, going into untold amount of debt to go my heart longs to be a mom or a dad. And we're going to do whatever it takes. And you have a lot of people who encourage you. And the reality is you just don't know how all that's going to play out. There's no guarantee on these treatments. That's right. Except for the bill coming due. Yeah. You want it to end well, but it's sad when it doesn't. That's exactly right. So here's what I want to encourage people that may be listening and watching in the situation. If that's the case, then I say go all in, but go all in and be able to pay cash for it. So sacrifice in other areas of your life. Don't sacrifice your future on the altar of the immediate, where you want to do whatever it takes to become mom and dad. And I

I just would say, you know, sell the house, like change your living. Like, okay, we're going to go backwards a little bit in every other of our life so that we can start a family. And it's a very tempting thing. And you know how tough emotionally. I'm sure you've walked that through with other ladies in your life and friends. We're all kind of touched by friends that have gone through it. Just please don't fall into that emotional trap.

I agree. To where you can rationalize debt because it's going to make that existing pain even more painful. So tough stuff there. Julie, thanks for calling and sharing transparently with us. We're rooting for you here. You've got this. Hang in there. Better days are ahead. All right, let's go to William in Pennsylvania. William, how can we help you today? Hi, so I got two questions. My main question is investments. Since I'm actually able to put money aside and save up a lot more, I'm wondering what places I can invest my money into for the best result in the long run.

I'm very young and I'm hoping to be able to have a lot more than just a 401k whenever I, it's time to hopefully retire if I'm ever able to. How old are you? 22. 22. And do you have any debt? Yeah, I have a house and two vehicles. Wow.

Oh, boy. Tell us about those first before we get into the investing. Okay, so last year I closed on my first home right before my 20, first birthday. I moved in around September 3rd, I believe, was my move in date. All the furniture outright, had the closing costs figured out, had the down payment figured out, and I owned three vehicles completely. I bought them all in cash. Great. And once I figured out, you know, how much money I was making, it's not a lot, but for this area, it's quite a bit. What do you make? I was able to do, right now I make $27 an hour. Okay. And I appreciate it.

all the timeline. Yeah, get it. Yeah, for Southwestern PA, it's substantial. Okay, 27 bucks an hour is great. But you said you have two car loans. How much of the car loans? Combined or like separate? Separate.

You had two cars, two loans. My first vehicle would be my now wife's vehicle. We paid $15,000 for it, and I did have to get a loan for it. And I pay around $300 a month for it. So you owe $0.15 on that. one? Just about. Okay. And then what do you owe on the second car? So I just bought a truck about three weeks ago, and it was $23,000. I pay just under $400 a month for it. And what do you take home every month? From your job? Combined, we both take home around $6,000 a month. Okay. And what do you

pay in your mortgage payment? My mortgage is $600. Wow, that's good. Okay. Um, I'm afraid for you because you're starting a trend of debt. A bad trend, yeah. I understand that. I was told, and I just realized that a couple weeks ago. Okay, I'm glad that you, and so you agree then, you're like, I can't keep going down this route, right? Oh, no, that's the last purchase I'll be making for a long time.

Good. Okay. If I ever do again. Okay, I'm glad to hear you say that. So you started out with an investment question. I will get to that, I promise. Ken will make sure of it. But I did want to address the debt. So you do, if you've been hanging out with us for a while, you know, can we do say that you do need to be paying off your debts before you invest? And there's a lot of reasons beyond the high net. Right? And you want to make sure that when you do invest, you're able to invest an amount that's really going to move the needle for you and you have the fullness of your income at your disposal to do that. So step one is you and your wife getting together and saying, how can we quickly tackle this $38,000 of debt using our $6,000 a month income so that we can regain $700 a month in payments, right? That's the first plan. So do you have every dollar?

What do you mean every dollar? So every dollar is our budgeting app. It's really more than a budgeting app. It's giving you your whole financial snapshot. Yeah. So you'll spend, I'll give it to you for free and you'll spend you know five minutes telling them you're telling the the app your situation and it's going to craft a plan specifically for you and it's going to help you find the exact margin that you need to pay off this 30 some thousand dollars of debt yeah and then as long as you follow the recommendations i promise you're going to get there because it's going to tell you exactly what ken and i would tell you here in this room which is yeah list some smallest to largest start with the 15 0001 first but it's going to look deeply into your budget and find money that we

can't see through the phone line. So that's step one. Now let's talk about your investing question. Ask it. Ask it again so I don't miss it. So I do have a 401k. That's obviously brand speaking new. But, you know, I don't want to just have to rely on that in 50 years from now if, you know, if I'm able to retire. Why? I don't want to just have that. What do you mean? Why? I'm trying to understand you. Why does that bother you to have a 401k? I just, I just. don't want that to be the only thing I settle with. What do you want besides that? That's just a traditional retirement counselor where you want land.

You want, what do you want? I mean, I would love to buy land. I would absolutely love to. But I just, I'm new at everything. I just graduated almost five years ago. That's true. You sound older than you are. You do.

You're an old soul. I think Jade needs to give you, I'm going to have her walk you through the baby step plan and strategy so that you get this. And she can touch on the investing. so that you see the big picture. I do want to, I'm actually going to go in the reverse order of what Ken said. She's going to do the reverse of what I said. Reverse.

Sounds like my marriage. My bad. All right. Stacey, here's what I think we should do. Oh, you don't. Okay, never mind. We'll do what you want to do. Sorry, Ken.

Listen. No, it's great. I'm sorry. No, keep going. It's great. Okay, okay. So let's talk about the investment part first. So because you're not the only person with that question.

So if you were saying to me, Jade, I want something other than a 401K, because I want to be able to retire before 59.5. I'm with you. If you said, Jade, I just don't like the idea of all my eggs in one basket. Can I have something besides a 401k? I just love diversity. I would be right there with you. And I am. So, yeah, once you have gone beyond a certain baby step, all of those things open up to you. And I want to talk about that. So to Ken's point, we talked about first, just save up. I'm going to walk you through the baby steps. First, just get $1,000 saved. Do you guys have any money saved anywhere? no i yeah we just paid off the wedding we just got married last weekend actually and after all that i may have not done it the right way but i did it everything is paid off the only thing we owe is our debt now understood but what do you have safe and i have money in the bank in the bank i probably have around four to five thousand dollars that's like my but my cushion is what i call it is my cash i keep in my bedroom i have just under 10 oh okay so you got 15 000 total excellent that's just what you need I don't have money. I get nervous and I freak out. I need money.

Okay, well, I'm about to freak you out for a minute, but it's so that you can feel your best in the end. If I were in your shoes today, William, I would take 14 of that 15, and I would pay off your car. And I know I just like that. Yeah, just like that. And I know I just like swept the knee right there. He's breaking out. I know. The hives are, they're hitting his neck. I can see it on the other end. Yeah. I would do that because you, what's ultimately going to get you what you want is to free up this income. And the debt, that's just, it's like a, it's like a dead weight around your ankle. Okay. And we got to clear that out. So if you did that today, right, and you cash flowed the other thousand, because I always want you to have a thousand dollars saved. You need something.

You would have $300 freed up today immediately. And then you could take that and throw it at, keep throwing it at the debt, right? And how quickly could you have that $23,000 car paid off, right? I could have that paid off like the middle of the next year, maybe three quarters away in the summer, hopefully. If you both worked extra, you could have it done by the end of this year. Yeah, by the end of the year, yeah, 12 months. Yeah. So, and then you'd have that extra $700 and you and your wife could stack up, you know, three to six months of expenses. That's baby step three. and then after that you're investing 15% of your income into your 401k and 15% ain't too shabby like if you keep that going yeah you know and then after that we would say hey now let's take

you know take a moment and focus on putting a little extra aside for your kids this is another form of investing it's called a 529 you can throw a little in there whatever you decide and then you can say okay let's start paying off our house because we value real estate right you wanted that diversity so you start paying off your house most people who do this william pay their house off within seven to 10 years yeah i was hoping to pay it off in 15 so okay okay even great i love that if you do it in 15 years again love that for you now you've got a piece of real estate now you've got your 401k and then if you say hey i kind of like this land deal let's keep saving up money and buy another piece of land or let's keep saving up money and i want to open another type of investment account i

just want to open one that's not tied to retirement to where I can invest the money and get to it whenever I want. You can do that. It's called a brokerage account. There's so many options for you, but you must walk through the steps in order to free up the income in order to do it. So that is the caveat. You need the income that you're now paying in payments. One step at a time, William. We believe in you. Our scripture of the day comes from Deuteronomy 28 verse 12. The Lord will open to you his good treasure. The heavens, to give the rain to your land in its season and to bless all the work of your hand. You shall lend to many nations, but you shall not borrow. Our quote of the day, this is kind of scary from Stephen King. Not a Stephen King fan, but I'll go ahead and read the quote.

What separates the talented individual from the successful one is a lot of hard work. Oh, well, that's not, well, the hard work is scary. That's the scary part. I guess I should stipulate. I don't know him and don't have any. I just don't like scary stuff. I don't either. James, I'm that guy. When I'm in the movies with my wife and it's the previews and the horror comes up, I literally close my eyes. I do too. You do too? Listen, I don't want that stuff going in my brain. Thank you. I do too. And I haven't seen Shawshank Redemption, but he wrote Shawshank too. So he does, he has a lot of stuff outside the horror genre. I didn't, I did it. I didn't know that. I did not know that. I had him as just a horror guy and that's why I had to Craig. I don't, no position against it. I don't like his work. Let's put it

that way. Other than Shawshake, which I didn't know, James. Yeah, that's good. That's good. Actually, now I'm second guessing. Oh, yeah, it's based on his novel. Yeah. Wow. That's a classic. James pulling the feather out of his hat today. Very impressive. Jenna is up in New York. Jenna, how can we help today? How you doing? I'm literally losing sleepover decision I have to make by tomorrow. And what I'm struggling with is whether to give a friend $900 who hasn't responded to any of my calls or checks for like three years. And then she suddenly reached out and she's literally begging me for help to pay off a storage unit lien that she says needs to be paid by four days from now. And she said it holds all her worldly possessions. So I contacted the

storage company directly today. And in doing so, I learned she actually owes double that amount. And I'm kind of uncomfortable with a variety of the details they gave me. But But it also, I could get the money, but it would be a financial hardship for me. But I'm, what I'm torn with is I'm feeling so guilty. No. Why? And because like, what if this was me and like the way she worded it and stuff? And but at the same time, it would be a boundary, you know.

Okay, Jenna, I love this. I love that you called us because you need somebody that's objective. Jade and I have zero feelings on this deal. So I'm going to ask you a couple of questions. I was going to rewind. When she first requested the $900, what did your gut? What did your body? What did your brain say?

Well, I just felt so sorry for her because she hasn't talked to me in three years. No, no, no, stop, stop, stop. Let me re-ask the question to make sure you get what I'm asking. About the $900, if she'd asked for $9, what would your brain have said? What would your body have said? $9 yeah okay if it was $90 what would your brain and your body have said yeah okay when she asked for 900 don't tell me all these other things what did your brain and body say when you processed $900 um it was hard because i'm trying to follow some advice from you and pay off my mortgage

yes and you just told us that $900 is a hardship that would be brought on yourself to help somebody pay off a debt and this somebody's not even in your life. They haven't even returned your calls. They haven't even had the common decency to return a text. This is a hard no from me. Jenna, can- But she did return. She reached out three weeks ago and then I got the text two days ago. That's fine. That's fine. But can I ask you a question? If I said today, Jenna, it is your mission to go out into this world and earn $900. Could you do it? I think I could.

Okay. That's your answer. Because your friend can too. And the question I also have is, is this still your friend? Well, you know, we were close and she went through all these things for, you know, time's sake, I won't go through it. That she shared when she called me. And she says she's getting a contract in the middle of the month and that she would pay me back. Oh, well, Kaibosh. I'm going to put the kibosh on this right now because here's the, here is what I will say.

If you decide, because this is your choice, if you decide to give her the money, you are giving it to her. You cannot lend her this money. You either give it to her out of the goodness of your heart and out of the detriment to your own budget and to your own life, or you don't do it at all. You cannot lend because if you lend, if you lend it to her, you are not helping her. You're just moving the debt. And now you're straining an already strained relationship. That's who I called because I needed to hear you say that because I knew that's what you would say. Yes, ma'am.

Listen, you didn't even tell us, nor do we need to know what are the other details that you found out from the storage facility. But it screams to me that you're not getting the full story from this fake friend. This is not a real friend, and I'm going to say it. Real friends don't. I just feel very not generous. Well, Jenna, that's your problem on how you feel, because I can tell you, you're a generous person. The fact that you're even considering helping this fake friend tells me you're generous. But you've got to make a good decision for you.

Not a good decision for her. Do you understand what I'm saying? Also, also, can I just throw out there? guilt and generosity don't live in the same house. Like, they don't live in the same. You don't give out of guilt. You give out of the abundance of joy. I think she's manipulating you.

This is a person who did not return your calls, did not return your text three weeks ago when she knew she had a problem on the horizon. She thought, hmm, I better hit Jenna up, start acting friendly again. I think this smells, this stinks of manipulation. This is a fake friend. and I don't give nine cents to fake friends, much less $900.

Yeah. Yeah, this is really think about that, Jenna. When you give, it should be out of a cheerful heart, not a guilty heart, not under compulsion, not under, oh, what are they going to think of me if I don't give? That is the exact. Matter of fact, I would say, wait until if you are still thinking about it, wait until all those feelings dissipate. and then if you can really look at this and go, I am just so grateful to help my friend. I have the money.

I feel joy about it. I feel good about it. Do not give with a guilty spirit. That is not generosity. That is guilt and shame. I got another thought just now. Jenna, how much is she actually owe?

It was 1800, right? Yeah, 1800. Why is she coming? And that's the rent. So that means they won't take a lien if she pays it by the 23rd of the month, but she told me Tuesday, but she still would owe lien fees and late fees. And then the first of the month, she has two units. She has a $900 payment and a $786 payment on the first of November.

So, Jenna. So I don't feel like I'm helping her because if I give her this money, then it's where to get in the next money. Yes, Jenna. I wish you could see our studio audience. They are shaking their head. You just came into the light. you actually just you took you took us where I was trying to take you in other words the $900 isn't even going to solve the problem and that tells me and I hate to say this

jade but I'm old enough now do it to have lived enough life to know that she's hitting several people up for $900 this stinks as my grandmother used to say to high heavens there's an old phrase from the South, Jenna, this is bad news. And I am hoping to remove any unnecessary guilt. You are not a person who has done anything wrong, thus you should not feel guilt. But you're such a kind person, Jenna. I just keep hearing my mother say that's not Christ-like. Well, that's another problem. We're now arguing with our mother. Who's probably no longer here. So listen. I guess I I did need that non-objective opinion because I knew if I give her the money, it's not alone. I'll never see it again.

I'm going to say a final word. You don't even know if she's going to put it on the storage unit. I got a final word on this, Jenna. You know? The reason you feel guilt is because you think that not wanting to pay her is wrong. That's actually right. And I'm going to flip it on you and say that if you give her this $900, that's wrong. Entitlement, baby.

It's stupid. It's not good management of your. money. Therefore, Jenna, it would be wrong for you to give her $900. It's my best shot. Stand-up business, Kim. Where's my hat? Where's your hat at? Oh, my goodness. Remember, folks, there's ultimately only one way to financial peace and that's a walk daily with the Prince of Peace Christ Jesus. No matter what you want to do with your money, you need a budget. Start. budgeting for free today with the Every Dollar app, the easiest way to budget.

Track your expenses and reach your goals faster. Go to Everydollar.com today.