The Ramsey Show - App - I’m a New Listener... How Can I Get My Money Back on Track? (Hour 3)

Episode Date: January 3, 2023

George Kamel & Ken Coleman answer your questions and discuss: "My credit cards are maxed out, how can I dig out of this debt?" Should you take a lunch break? Matching 401(k) vs. Roth IRA, Quitting before you have another job lined up, How long to keep a house on the market. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm George Camel, joined this hour by my friend Ken Coleman, bestselling author and host of The Ken Coleman Show. And we're here for you, America, to help you kick off the new year strong, help you achieve your goals, whether it's professionally, financially, relationally, you name it, we are here for you. The number to call is 888-825-5225. Johnny is kicking us off in Denver, Colorado. Johnny, welcome to the show. Hi, guys. Thank you so much for having me.

Absolutely. What's going on with you? Well, to keep it simple, I have about $40,000 in credit card debt that I'm looking to erase as soon as possible. But it's really difficult because I only make around $45,000 after tax and I owe so much credit card debt and all my credit cards are over the limit that the interest alone is almost the exact amount of any minimum payments I'm able to make on a monthly basis. So just as of right now, I just don't know how I'm ever going to even make a dent in this because any payments I do make, the interest all but absorbs it and I make like no progress. What is the range of the interest rates on these cards? They're 25 to 29%. Oh my goodness. I'm so sorry. What are you doing for work?

I am an appraiser, just like a valuation analyst for commercial real estate. Can you work overtime in that role? It's a salaried position, so it's a full-time gig already. I work like maybe 40 to 50 hours a week, but it's salaried. So 25% of my overall earnings are going towards like benefits, insurance, 401k savings, Roth IRA accounts, etc. What other debt do you have other than the $40,000? Other than the $40,000 in credit card debt, that's really just it. So no car loans, no student loans?

I have $13,000 in student loans, but I'm really just hoping that the Biden administration will just kind of wipe that away from me. You were going to be hoping to the grave my friend yeah hey i want to go ahead and give you some breaking news all right uncle joe and no president any party is going to forgive student loans it's big business for them they're not going to do it it's an empty political promise i'm just here to tell you i want to bash that so that we can move on to getting out of this debt you got it yeah all right so any other debt just here to tell you, I want to bash that so that we can move on to getting out of this debt. You got it? Yeah. All right. So any other debt you want to tell us about? We got 53 total right now. Okay. No, that's it. Just the student loan that I was hoping

would just disappear on its own, but now that you're saying no, then it's 53 total. Now, are you a new listener to the show? Yes, I just found your guys' YouTube channel about a week ago. Oh, welcome. Welcome aboard, sir. Welcome to this weird bunch of crazies. So here's what I'm going to do. I'm going to walk you through the baby steps. You're in baby step one right now, trying to get $1,000 saved in the bank.

Do you have $1,000? Yes. Okay, great. How much left over after the $1,000 do you have? Do you have more than that? After I take away $1,000, I'd be left with $1,000. Okay, great. How much left over after the $1,000 do you have? Do you have more than that? After I take away $1,000, I'd be left with $1,000. Okay, so you've got $1,000 left over. How much are you investing right now?

No more investments. I pulled out all of my investments to pay off some of my credit card debt. Like you pulled from your retirement? No, I don't really have a retirement account aside from my 401k and Roth accounts. Okay. So you didn't touch those? No, I didn't touch those. Okay. So where, you said you pulled it, where did it go from? I pulled it from like my stock accounts that I'd started when I was in high school. I had accrued a couple thousand, but then when the credit card debt became too much, I just pretty

much pulled it all out to make payments towards the credit cards. But then the interest kind of just like went way overboard. So what are the minimum payments right now across your credit cards? So the minimum payments across my credit cards, I have three big ones. It's $300, $300, $500, pretty much around $1,200 minimum every month. Okay. And you're able to make those payments, but the balance keeps growing? Yeah, I'm able to make those. Yes. So to clarify, I'm able to make the minimum payments on a monthly basis because I pull in around $3,900 monthly. But the interest is so high, again, like around 25% to 29% that the minimum payment on one card is $300, and then the interest is $303. Have you looked into refinancing any of that debt to a lower interest? I had thought about looking into it, but I'm kind of discouraged because one of the options was like a credit transfer card that might be able to absorb all of the credit card debt that I have into like a zero interest card. But research indicates that I probably need like a minimum 670 credit score to even qualify for one.

And due to the damage over the last three months because of the fact that all of these cards are over the limit anyways, I don't have enough of a high enough credit score to even consider getting a credit transfer card. How much time do you have? George is going to keep walking you through this, but I just got to ask. How much time do you have or could you make to work extra doing another job? Well, I work full-time during the weekdays. I could definitely work on the weekends. And evenings. Can you work a few evenings? Well, it's a nine to six gig. So pretty much if I don't sleep, yeah, I could work evening. Yep, you can do it.

At 6 o'clock, you go eat yourself a ham sandwich in the car that you made. Do three hours of Uber Eats and DoorDash. Three hours of work, man. You have got to get some income in to pay off these cards, and the good news is you can do that. Okay, okay. This is a mountain in front of you, but you're going to start clawing away at this thing as you create more margin. Okay. Okay. once you do that you're going to look at your bank statement and go okay what are every single one of my expenses and then you're going to be brutal in cutting every single thing that doesn't just help you survive right now and so we're not eating out we're cutting our subscriptions we're cutting all the luxuries we are covering our four walls which is food utilities shelter

transportation that's pretty much it and you're whatever your insurance premiums are. Everything else is kind of a want beyond just putting basic food on the table, right? Right. So if you do that, I want to know how much of a raise you're going to give yourself of that $3,900 you're taking home. The goal is to say, hey, how do we get $2,000 of that being thrown at the credit cards? How do we get $2,500 of that thrown at the credit cards? And if you need to go make more income to get it to $4,500 take home, then let's go do that for a season to get rid of this. Because we meet people all the time who make your income, who have your level of debt, and they can do this stuff. And you can too. The issue you're running into is the interest rates making it feel insurmountable.

But as soon as you start clawing away at that, you get the balances lower, we're going to be able to cover this and communicate proactively with these companies and say, here's what I can pay. I can't get away from this right now. And some of them may go to collections. But your goal is to try to clean this up as fast as possible. I'm going to also gift you Financial Peace University. Watch all nine lessons. Start doing that every dollar budget, and you're going to feel a sense of peace, a sense of hope, a sense of confidence about your future. You can do this, man. Call us back when you're debt-free

and share your story and hang on the line. Austin's going to pick up and get you those gifts from us. so this is the ramsey show i'm george camel joined this hour by ken coleman and uh if you don't know about ken coleman go check out the ken coleman show on the ramsey network thank you george wherever you listen to podcasts on youtube he's everywhere let me tell folks what it is since you said they don't know what it is yeah it's about work the name isn't that descriptive so ramsey solutions is about money it's about relationships and work and i'm the work guy and uh we're about more than just work and a job the is, is do you know what your full potential is? And then what does it take to meet that full potential? So it really is, if you're growing personally, I got good news for you, you're growing professionally. And so we're trying to help you really figure out

that unique role where you're making great money and you're making a great contribution to the world. So that's what I focus on. And we take those kinds of questions here on the show. So thanks for sharing that. The Ken Coleman show is where you can join us for a conversation over there and all the stuff. Well, producer James sent us this article that has to do with work and I wanted your hot take on this, Ken. Here's the headline from Yahoo. Here's the headline. Should I take a lunch break at work? One in four Gen Z employees worry leaving their desks to eat is a bad look to the higher ups. Here's why that's, I don't mean like in your head, and this data is saying that a lot of Gen Z workers are worried that it looks bad. Well, there's a difference between I'm worried, I'm manifesting this thought that's not true, and it actually being true. So if, George, you are working in a place where your leader is frowning upon it, making passive-aggressive comments about you taking a lunch hour, you shouldn't be there

much longer. Find you another place, and here's why. The data bears out that you're not actually more productive. You may think you're getting more done, but it's going to end up being a negative for you by not getting up from your desk and a lot of these kids i i looked at the art a lot of these young people are eating at their desk they're called desktop diners desktop diners it's a fun little nickname we got a name for everything first it was quiet quitting now we got desktop diners um i i i think it's good for your mental health it's good for your physical health to get up change locations you know there's all kinds of data about walking for 10 to 15 minutes before you

have a big meeting I've talked about that on the Ken Coleman show you know it's a it's a creative release it allows you to kind of get some perspective. And so anyway, the lunch break is the same idea. You know, I have several friends here in the building that they go work out during lunch. Damon Goud, my fearless brand leader, works out during lunch. And it shows. It shows. And, you know, in multiple ways. So, you know, I do think that there's something to that. And I'm calling myself out on this because sometimes I go without lunch. You're known to do that. I'm known to do that. That has a cool name too,

Ken. It's called fasting now. I'm intermittent fasting. That's what I tell people. It's real trendy. What it really is, is that I have poor planning and I don't have time, but I need to make time. But now for me, I keep my energy up during that time. But for someone every day to be sitting there feeling like I can't leave my desk or else someone's going to fire me or they're going to think poorly of me. I'm telling you something, young people. You've got to get some facts to support that. And if you don't have any facts, you need to get over that. And just be responsible. Be responsible. Well, and the report that this study talks about found that stopping to eat and taking mental breaks can prevent burnout,

especially in the context of the extra stressful times workers have faced over the past few years. And so if you think you're being more productive, you're actually being less productive, and you're on your way to burnout if you can't take that break. That's right. Your mind needs a break. Your body needs the break. Get up. By the way, if i'm a young professional if i'm gonna eat out every day and some of you need to not be eating out you need to pack your lunch and go to a local park but you know what i'm trying to do i'm making phone calls

to people i want to connect with i'm eating lunch with people i want to connect with i'm using that time to grow professionally but i'm away from my desk. And it's actually discouraged here at Ramsey. If we see a team member eating at their desk, we're going, hey, what's going on here? We have got a whole cafeteria where we can connect with team members, and occasionally you'll have a lunch meeting or something like that. By the way, no one else wants to smell your tuna fish sandwich for the rest of the afternoon. Thank you for calling that out. Can we just, let's be real practical for a moment?

Especially in the microwave. We've got Thank you for calling that out. Can we just, let's be real practical for a moment? Especially in the microwave. We've got to avoid microwave fish in 2023. If you want to win professionally, don't bring fish to the office cafeteria. Not the advice we thought we'd hear on the show, but it's the advice we got. Sometimes it just presents itself and you have to give it.

It's perfect. I love it. Well, take your breaks, folks, for safety's sake. There we go. All right, let's get to the phones. 888-825-5225 is the number to call. Renee is joining us up next in Seattle. Renee, welcome to the show.

Hi, thanks for having me. Sure, how can we help today? So I work part-time. I've been at my company for about four years now, and I'm wondering, should I keep contributing to my employer 401k, or should I start contributing to my Roth? Oh, do you have a Roth 401k option at work or is it just a traditional? It's, I have, just my job offers the traditional, but I do have a Roth with nothing in it that I have with Fidelity.

You have a Roth IRA with Fidelity and then you have a traditional 401k with your employer? Yes. Okay, awesome. And are you debt-free? No, sadly. What kind of debt do you have? The biggest burden would have to be our credit card. How much credit card debt do you have? 23. Wow. Any other debt? Car loan, house. Okay. So let's just focus on the student loans, the credit cards and the car loan. If we focus on those two, what does all that debt add up to? So the credit card and the car loans, that probably adds up to, I'm almost done paying off one car. It'd be paid off next year within six months. So we're talking 50 grand in debt total? I would say 50. Okay. Let's get some hard numbers on that and let's be about the business of paying that debt off before we continue investing. And here's why. How much are you investing right now as a percentage? 3%. 3%. What if I told you we can get you to 15%? That's 5x your investing rate, correct? Right.

And so you can do that once we get rid of these payments, because add up all these payments in your life and go, hey, what if I could have invested that money instead pre-tax in my traditional 401k? Now we're talking. Now you can retire with dignity. So that's the baby steps that we teach is baby step two, paying off all consumer debt using the debt snowball, smallest to largest. Then we're saving up a fully funded emergency fund of three to six months of expenses to create a financial foundation because now we don't owe anyone anything except for the

house and you've got a pile of money in the bank for emergencies, which means you don't have to ever turn to the credit cards as a crutch again. You feel that? Yes, that would be nice. Then we have the margin to invest 15% of our household income into retirement. So now let's talk about that. Once you're there, which I think you'll get there in no time. What's your household income? About 97K. Okay. So you absolutely can pay all of this debt off with focus intensity, pausing all investing, and finding that margin, cutting expenses down. You can do this in under two years, right? I believe I can, and I'm actually looking for a remote job to try to help with the debt. Okay. Well, increasing income is only going to help. And then when it comes to the investing strategy, this is how we see it. Match beats Roth beats

traditional. So do you have an employer match? Yeah, I do actually. And that's what I've been contributing to. My employer match is 2%. Great. So we're going to invest once you're there, you're debt free with a fully funded emergency fund. we're going to invest 2% into that 401k to get the match. That's 100% return because it's free money, right? Okay. Then we're going to move to all of our Roth options. So you mentioned the Roth IRA, so you could fully fund the Roth IRA. And then if you still have money left over with that 15% rule, then we can go back to the traditional 401k and invest the rest there. Okay. The money I already have in the 401k, should I roll it over to the law? No, just leave it in there. Only roll it over if you leave that employer for any reason, then you could do a direct rollover to a traditional IRA so it doesn't trigger any

tax penalties or burdens there. So you're doing great. Let's just do things with intensity and with focus in order. And you're going to be back to investing 5x in no time. We are rooting for you, Renee. Please call us back if we can help in any other way. More of your calls coming up. 888-825-5225. This is The Ramsey Show. I'm George Camel, co-host of this show, of course, but also Smart Money Happy Hour, which you can check out on The Ramsey Show. I'm George Camel, co-host of this show, of course, but also Smart Money Happy Hour, which you can check out on The Ramsey Network. Joined this hour by my good friend Ken Coleman, host of The Ken Coleman Show. Open phones at 888-825-5225. We're taking your calls about money, career, life, work, purpose, and everything in between. Jason joins us up next in Houston, Texas. Jason,

welcome to the show. Hey, how's it going? Great. How are you? How can we help? Yeah, I was just hoping I could get some career advice today. You came to the right place, my friend. All right, thank you. So, kind of just a little bit of background. I graduated with my MBA end of August last year, and kind of just to pay my way through school, I worked at a, it's like a telehealth consulting firm, kind of working in their call center division. And it's kind of like an inside sales representative position, you know, making out on calls all day. And it's a very metrics-driven position. And fortunately, I've been able to do pretty well at it. And you know, was able to get a pretty nice bonus every month. And that's really helped me,

you know, graduate debt free. Now the company is saturated, I did have one interview for, you know, an account manager position. And unfortunately, I didn't get the role. And there's not a lot of other job openings there. And at the same time, I'm quite burnt out in my current role and kind of overqualified. I feel like my potential is being limited. So I guess my question is, should I just jump ship and devote myself full-time to the job search, or should I just continue working this job

and kind of, I guess, I don't know, try to lay off on the burnout and keep pushing through it? Well, it's a bit of both and. I don't want you jumping ship, but I do want you looking for another better opportunity. And you really know what you're looking for, I believe, or I'll tell you this, by what you just said, I know that you know what you're not looking for. And so that really should arm you with some confidence. But I want you spending every waking hour when you're not working because I don't want you stealing from your current employer. But you're treating this with super high priority because I don't want you to burn out. And I think you can hang on long enough

because you've got a very clear mission and your mission is I've got to replace my current job. The only way I would tell you to jump ship without a job is if you had the financial ability to do so. And I don't think that's your case. Um, well, I mean, I have saved up, you know, quite a bit of money to where, um, I would say about about i think by the time like if i do plan on quitting when i'm thinking i'll have at least maybe 15k saved up do you have debt no i don't have any debt right now is the 15 what is your emergency fund um is that your emergency fund the 15 $15,000? No. I mean, see, I'm kind of in a position where I'm kind of living at home, and so my expenses are pretty low. But you're saying you'd have $15,000 to your name?

Yeah. Let's call it that. That's not enough. It's not enough. What if it takes you 60 days to get the job you want? Right. I don't want you dipping into that because you don't have to unless the again i don't think you qualify for the well i'm financially set and i can take two three months

without any income i don't think you're there not by my standard and i don't think by your standard if you really look at it and i'm glad that you have the safety of having very little expenses. But why burn through any of that $15,000 when you don't have to? The only thing now that I would say is if you're in a truly, like your doctor's going, I'm advising against you going in there because it is that damaging to your health. Right. And I don't think that's the case either. But I think with you going, all right, I'm not happy here.

I know why I'm not happy here. And now I'm free to go find something. I know what I'm looking for, and I'll help you. I'll give you my Get Clear assessment. I'll give you the book From Paycheck to Purpose. Both of those are my gift today, all right, to help you with further clarity so that you can confidently move forward. Clarity is the key to confidence. Okay, yeah. And so I want you clear on what move you're going to make next. In other words,

George, I'm working right now on a smaller book on this, and the outline is is and this is for you jason it's why to quit you've laid out the why then we've got to figure out where to quit then we say once we know the where we figure out okay what's the win and that's pretty much determined right by the opportunity we understand that and then finally how to quit doing it the right way and not burning bridges that's your process right now you've got the why we need to figure out the where and then the when and the how will take care of itself. How old are you, Jason? I just turned 30. Okay. My goal for you also would be to get your own place, your own apartment, maybe with a roommate, but move away from mom and dad and give yourself that dignity where it is on you and you feel like an adult. And so I would be aggressively looking for that next job, get that lined up,

save as much money as possible because life's going to get expensive when you're on your own. So that would be my next goal. Just stack up a giant pile of cash and get that job that you actually want versus just doing this one because the money's good and it's safe. Sure. Yeah. No, that makes sense. We don't want you touching that money, Jason. Don't touch the $15,000 unless it's a true emergency. I want you finding something else to step into, and I'm going to give you the tools to help you get further clarity. Yeah. Hang on the line. Austin will pick up. We'll make sure to get that over to you.

Thanks so much for the call. All right, Jacqueline joins us in Fort Worth up next. Jacqueline, welcome to the show. Thank you. I got a chance to speak to you and Ken back in March of 2018 of last year. Oh, fun. How have you been since then? He said George on my mind, but it was Ray Charles, not Jay Brown.

I love that. Well, thank you so much for calling in. How can we help today? Okay. Now I'm debt-free, except for my house. At that time I had debts, and I told you I'd be out of debt. Love it. I had a buyer for my house.

Nice. About 10 days before we got rid of the clothes, they disqualified to have the loan any longer. So the financing fell through. Yeah, their financing fell. So I am here waiting. I've reduced my house about $20,000, trying to keep up with the market. And I got my stuff in boxes. And I'm not going to be moving out until I sign some paper on the dotted line. But the thing is, my question is, with the market going the way it is, I guess you would have to continue to be competitive with

the market to keep going up or down or whatever. Sure. What's your question? The question is, in order to sell the house when you've got competition around you, is it, I'm not going to go for solo. Is it necessary to kind of go with the market, with the sale of the house and the value of the house? Well, you can have a threshold and say, hey, I'm not going below this. If that's the case, I'm staying here and I'll just keep living here until the markets back up. And that could be a

long time. We just don't know. We don't have a crystal ball here. Are you working with a really good real estate agent? I think I have a good real estate agent. He's the same one that told me to purchase a house that I'm in now. Okay. You can always get a second opinion. I'm going to buy it within a week. Yeah. Well, you can get in touch with one of our endorsed local provider real estate agents.

They're Ramsey Trusted. And these people sell a lot of homes. They are the pros, and there are some in the Fort Worth area that would be happy to give you a second opinion on this. You don't have to work with them if you don't want to, but I think we need a second opinion here because if the house isn't moving and you've already dropped it by $20,000, something else is wrong. It's off the market now. We went down to $20,000. It wasn't on the market at line. We took it off the market. Well, hard to sell a house when it's off the market, isn't it?

It's off the market now, but we're going to put it back on the market this month. Okay. I might wait. I might get in touch with a real estate endorsed local provider at RamseySolutions.com and see what they say because I think you've got a marketing issue. You may have a pricing issue. We just don't know without looking at the details. But you need someone who is a high octane real estate agent to help you move this house at the price you want to move it for. And I absolutely think they can help you do it. So thank you so much for the call. Wishing the best for you with this home sale so

you don't have to have those boxes laying around too much longer. This is The Ramsey Show. I'm George Camel, joined by Ken Coleman this hour. Our scripture of the day comes from Proverbs 11.3. The integrity of the upright guides them, but the unfaithful are destroyed by their duplicity. Henry Ford once said, quality means doing it right when no one is looking. Love that, Ken. That reminds me of our Ramsey core value, excellence in the ordinary. You went a little deeper.

It reminded me of how you do your hair. What's that? Read that quote. Nobody's looking when you're in. You are really precise about it. Thank you. I had the privilege of being on a retreat with you. Oh, that's right.

And here we are. No, I didn't see it. I heard it. You heard the blow dryer going. This is before we head out on the boat. This guy doing a 10-minute get his hair right routine before we go on the boat. And to me, I thought that's what it made me think of. No one was watching you, but boy, it is. It is well coiffed. The higher the hair, the closer to God. Is that what the rule is? Yeah. I think Dolly Parton said that. I don't know. That's how I live my life.

You know, I interviewed her once. Really? Yeah. She seemed very pleasant. Yeah, very nice lady. Awesome. Well, let's get to what you're here for, America, and that is the calls, 888-825-5225.

Ava joins us from Springfield, Illinois. Ava, welcome to the show. Hi. I have a question. I have about half a thousand dollars in savings and cash, and I'm aware how to like get a job. And I've done some side jobs like babysitting and gift wrapping, and I make about over a hundred or $200 each time. But I want to know how can I set up good financial habits before experiencing debt and how to know whenever I should spend money on things that I want and hanging out with friends or just on savings.

How old are you, Ava? Almost 14. Oh, that's fantastic. That's incredible. Wow. You know that you are so much smarter than most 24-year-olds I met, 34-year-olds? Thank you. Where did you learn this stuff? Where did this mindset come from and this work ethic? I watched the Dave Ramsey show with my dad, and my parents kind of teach me how to use money wisely. That's incredible. Well, they're raising you well. We appreciate you being a listener. So let's get to your question. So you said you have how much in the bank right now? I have about over a hundred in the bank and then over 250 in cash.

So 250 cash, a hundred in the bank. What is your next financial goal? Probably saving for a car. Wow. Okay. So a few years from now, you're almost 14, you're driving by what, 16 in Illinois? Yeah. Okay. So in two years, how much money do you think you could save up if you kept this up? Maybe you go get, I don't know the age limits and requirements in Illinois, but could you go get a job somewhere at 14 years old? Yes, most likely. On top of your gigs doing babysitting and gift wrapping and all that? Because gift wrapping is pretty seasonal, I imagine.

Yeah. Yeah, but the babysitting is where the bank is. I've got a 14-year-old daughter named Josie, Ava. So you two are close in age, and she's making pretty nice money. What are you getting for babysitting? What's the hourly rate? Depending on the family. One family pays me $20 an hour, and other families pay me $10. Sometimes I just get $20 or $40.

Wow. I'm going to tell you something. I'm going to try to find me about five more $20 an hour families. That's the first thing, all right? Do you enjoy it? I'm serious. Do to find me about five more $20 an hour families. That's the first thing. All right? Do you enjoy it? I'm serious. Do you enjoy it? Yeah.

Oh, yeah. I love hanging out with the kids. And it's flexible. You can do it kind of on your own schedule right now because are you in school as well? Yes, I am in school. So you're limited to kind of some evenings, weekends. I'm sure on school nights it's a little harder.

Mostly weekends? Yeah. Yeah,, weekends. I'm sure on school nights it's a little harder. Mostly weekends? Yeah. Yeah, mostly weekends. I love it. Well, I would set a goal. Have you talked to your parents about if they are going to be contributing to this car? So my brother, my oldest brother, he had a little bit donated to him, but he had to get a job and save up for it.

So my parents could afford to help me, but we usually have to pay on it on our own so that we can learn how to save money. When you say pay on it, do you mean with payments? No, with cash. Okay, good. Oh, yeah. This is a Ramsey girl. Good.

Oh, come on. All right, so maybe pitch this. Say, hey, Dave Ramsey, here's what he did with his kids. It's called the 401 Dave Plan, where I'm going to save an amount, and you as mom and dad will match whatever I save up to a certain limit. So you might say, hey, if I save up to $3,000, will you guys match me dollar for dollar up to another $3,000? That would give me $6,000.

You think they would do that? Okay. I could ask. I don't know. That's your homework right there, is have that conversation with mom and dad. Now, if they say, no, we're not giving you a penny, then it's on you. And so it may take a little longer, it may take more work to get to that $6,000 instead of $3,000. But that's a great goal to have on top of also enjoying your life as a 13 year old girl and hanging out with friends and going to the mall i don't know what the kids do these days what do you do for fun ava yeah i hang out with my friends our mall is still cool can you just tell me

this is this is deteriorating ava i'm sorry i'm gonna rescue him he doesn't have kids i'm helping america i'm the father of teens all right no? No, hanging out at the mall, it's not cool, George. That's me and James hanging out at the mall all the time. Well, look at you two. Need I say anymore? Gosh. Ava, here's the deal. I think George is giving you great advice on laying it out with mom and dad. Whatever amount they gave to your brother is probably what they're going to consistently do for you, so take that amount. And then what I want you to do, which is really powerful for young people and adults, is when we're saving for something big, is to visualize that. And I think it'd be fun for you to spend some time with mom or dad on the used car market, you know, online and just get an idea

of some cars that you think are cool or cute or whatever a 13-year-old girl would call it, but a car that you like, and you begin to see how much that car costs. Your mom and dad will say, well, that's got too high of a mileage or whatever, but begin to just get familiar with it. Now, in two or three years, the used car market may change a little bit, but by and large, it's going to give you an idea because I want you to be able to know, okay, I think I want 8,000 or I think 10,000, or I'm going to be okay with five. I think to have that visual and a very specific financial number is going to be huge for you. And then you can go get a job, maybe at your grocery store or a fast food place or whatever, plus babysitting.

And then you start to go, all right, how long is it going to take me to save up this amount of money? And before you know it, you're going to be there. Oh, yeah. And Ava, it already sounds like you never want to touch debt. Is that correct? Yes. That is the number one factor to your financial success is if you never touch debt, you never open a credit card. Maybe once you turn 16, you get the car, you open open a credit card. Maybe once you turn 16,

you get the car, you open up a debit card at your local bank or credit union and use that to start paying for your car expenses, for gas, for food, and all of that as you get maybe a job while you're in high school. And that's going to set you on a path for success. If you have that mentality that debt is off the table and when it comes to college or further education, we're not going to go into debt. We're going to get whatever we can save up in cash, that's how we're going to explore education. And that's how I'm going to explore my next car. And the next thing you are going to be so far ahead of most of America, it's going to be mind blowing. Okay. Thank you. We are so proud of you. Thanks so much for the call. Ken, that just gave

me a little pep in my step to talk to Ava. I got to say. Yeah. Well, now you should know when you talk to 13-year-olds, don't ask them if they hang out at the mall. I don't. I'm trying to keep my finger on the pulse of what's cool. Yeah, well. That's what it is.

That's probably misguided as well. Those days are over for us. I know. You and I being cool. We can't go to the mall. What are we doing? What are we doing here? You got a cardigan on.

It's over, man. Exactly. Pack it up. Exactly. I mean, nobody cool wears a cardigan, but I'm not cool. Well, a seven-year-old dressed by his mom or a 48-year-old man. Those are the two options. Ken knows I love a good cardigan.

Yeah. Have you ever worn a cardigan, George? I love cardigans. Yeah, you actually look quite dashing in the cardigan. Thank you. It means a lot. Yeah, there you go. Well, a happy new year to you, Ken. It's been a fun show. Yep, fun times.

And that phone call, by the way, is why we do what we do on YouTube. Because she's watching the show on YouTube, and her parents, good on her parents, for setting some expectations that are really going to help her later on in life. That's really fun. You know what got me? Ava has a higher net worth than most of America at 13 years old. That should inspire you to greatness, America, to make some changes this year, to increase your net worth by getting rid of the debt, which gets your net worth to zero,

and then start investing for the future. Have a pile of money in the bank. That is financial peace in good times and bad, regardless of what happens in the world this next year. So we are rooting for you. We're here for you. We're going to be back real soon. My thanks to my co-host, Ken Coleman, all the folks in the booth, Austin, Ben, James, Zach, Nathan, and you, America. Until next time, spend wisely, save intentionally, and give generously. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube.

Go watch and subscribe to the Ramsey Show channel on YouTube. Ramsey Show.