The Ramsey Show - App - I'm Scared To Go Without a Credit Score (Hour 2)

Episode Date: March 23, 2021

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Dr. John Deloney, Ramsey personality and host of the Dr. John Deloney Show, is my co-host today. As we talk about your life, and that is what he specializes in, and your money. And, of course, we'll both talk to you about that. Open phones here as we mix those two things together and create this soup called Common Sense. The phone number is 888-825-5225.

That's 888-825-5225. Clint starts off this hour in Chattanooga. Hey, Clint, how are you? I'm doing well. How are you, Dave? Better than I deserve, for sure. How can I help? My wife and I are 37 years old.

We've been living your plan since we graduated college and got to Baby Step 7 in 2015. So we haven't had payments in six years at this point wow yeah so you just dropped that so you're like 32 years old you had a paid for house and you've been sitting there five years since then so you're a millionaire already uh yes we are at 37 years old because you did our plan since college touchdown Touchdown. I'm done. John, you just take the show from here. I'm out. I just felt the collective eyes of America roll like, oh, gosh, this guy. That's awesome, Clint.

You're incredible, brother. Well, thank you very much. It's been a great journey for sure. How can we help today? So we have a great problem of having a lot of money in retirement accounts already. I hate it when that happens. So we've got about $515,000 in retirement. And my question is, should we keep adding into that retirement or should I redirect that, leave what's in there there and redirect future contributions into something that's not a retirement account

that's locked down until 59 1⁄2. What's your household income? Last year we made $225,000. Yeah, I would probably not. I probably would. Because of your young age, here's your tradeoff, okay? Your tradeoff is, like, your concern on one side of the pendulum is everything's stuck in retirement until 59, I can't mess with it.

And I can't do something else with it that I want to do, like buy a lake house or something, right? Right. Which is an important purchase. And so that's the trade-off. The other side of the pendulum is every dollar we do something else with, the government's going to get more of it. Right.

And so if you take, for instance, I'll tell you what I do. I max out everything, and then any other savings I do for other things, I just throw it in an index fund, like an S&P 500 index fund. It doesn't have any taxes on it until you sell it because it's a low turnover ratio. And if you leave the money in there at least a year, what taxes you have on the growth will be at 15% at capital gains anyway. In your case, my case, I make more than that,

so I get charged more for capital gains because I'm an evil rich person. You must be punished in America. So, yeah, you get taxed lower and you've got access to it, but it's still not as tax-friendly as retirement is. So if you want to divert a portion of this over to that, that's fine. The tradeoff is not you're going to be broke at retirement. The tradeoff is the government's going to get more of your money doing that in order to have access to it before 59 and a half. Okay, great. And I think that's a reasonable tradeoff for some of your investments at this stage.

So here's a rule of thumb. If that money's invested and making around 10%, if it's in good mutual funds the way we teach, it should be doing that on average. If you don't add anything else to it it's gonna double about every seven years so at 44 it's gonna be a million at 51 it's gonna be two million at 58 it's gonna be four million if you add nothing to it right all i was doing is doubling it each time you follow me and so when you and so if you add nothing to it. Right. All I was doing was doubling it each time. You follow me?

And so if you have $4 million in your protected accounts, and that's all you have in there, that's fine, as long as you've got some other wealth built on the side. And we're not talking about consuming the money, but you're not consuming anything because you're consuming things, but you're doing it intentionally, and you're not asking me about that. You're asking me about investing that's correct yeah so oh man you're so cool that's awesome so proud of you it's really nice yeah so i probably

would not shut it down completely but i would redirect some of to where you've got some money over i'd like for you to have if you got four or five six million seven million in retirement i'd like for you to have three or four million at 58 in non-retirement okay great and that you could do other stuff with in the meantime again it could be a purchase it could be just access to the money without any penalties it could you know because you have got you've gotten such a head start god you're so man so when you're when you're thinking about buying a big piece of real estate, do you use that index fund as a savings account? That's my savings account. Okay.

That's exactly what I'm doing. And so if, you know, like we're building these buildings here. And so what I do is I take all my income right now, almost all of it. I live on a little bit of it, but I throw almost all of it in an index fund, and then when I have to write these stinking checks for this concrete we're putting up next door and getting ready to start an event center across the street, this millions and millions of dollars, they just come out of that account.

Gotcha. And it's just parked there. Sometimes I don't make a lot on it because sometimes the market's up or down while I ride it, but I can afford that ride in that situation because there's so many freaking zeros involved. Is the volatility worth just putting it in the... I guess you can't put it in a savings account because it's so many freaking zeros involved is the is the volatility worth just putting it in the i guess you can't put in a savings account because it's not insured you're

gonna well you it's not insured but i'm not worried about the insurance it's just it might it might lose one percent it might make ten percent okay but if you put in the other you're gonna make one percent and i'm just not gonna be thrilled okay you know so i've got some sitting in money markets and that kind of stuff for that kind of thing. But I'm just generally, this is an investment account. I'm throwing it in there. I try to leave it alone a year so I can get the lower tax rate because even I get a capital gains tax break on that. But this is baby step seven stuff, folks. This is what you're doing at baby step seven.

And this is what you're doing if you're 37 and you're already a millionaire. And these are good problems to figure out. Yeah. These are problems. When I started this show, I dreamed I would get that call someday. That 20 years after doing this, that guy, when he was 22, started doing this stuff. He's 37 now, and that's where he is. He's why we're here.

That's who I want to be with. Man, that's awesome. I love it. Love it. Love it. Love it. Love it. Love it.

Love it. Very cool stuff. Yeah. So, yeah, the thing you don't want to – you guys listening, you don't want to use that discussion that we're having there as anything except something to point out that I want to be someday. It's not a discussion to say that's a reason to not do the baby steps. Well, I've even wondered if I'm saving to buy a rental property, if I'm saving to buy, like, some acreage or something. That would be after your house was paid off. Right.

So you're in baby step seven. Right. Where do I hold baby step seven. Right. Where do I hold that? So I'm just going to dump it in the next fund? You can hold it in that index fund, but the risk you're taking is the market could go down, which means if you found a piece of ground, you might not want to buy it because your money's worth less right then. You may want to wait on it to come up, and then you might miss a piece of ground.

Or you might go, well, it's just the cost of doing business, and I lost a little bit. You're never going to lose the whole account. If you do, that means the entire economy collapsed and that's just not going to happen.

I'm not worried about that. Does it dive sometimes and take your breath away? Yeah. And does it shoot up sometimes and take your breath away? Yeah, that's part

of the roller coaster ride. That's why people get on them. This is The Ramsey Show. Your number one wealth building tool is your income. For business owners, this comes as no surprise, as you're used to putting in extra hours and watching your bottom line. That's why Christian Healthcare Ministries or CHM is a great option for those who are faith focused and budget conscious. CHM is not health insurance. Rather, it's a health cost sharing program. It's not harder, but it is different. To learn if CHM is a fit for you or your business,

visit chministries.org slash budget. Thank you for joining us, America. Dr. John Deloney, Ramsey Personality, is my co-host today. John, there is a disturbing thing happening with teenagers and with COVID that you've been talking about on your show. And James, our producer, sent us an article on the loneliness issue and teen mental health with this. That is scary. Yeah. If you could construct a way to torture teenagers, It would be to isolate them, put them in a house with their family

for a year or more and force them to connect via social media, which are outlets that we know exacerbate anxiety, depression, these things, make people feel less than,

make people just accelerate this disconnection, man. And it's an absolute mess, Dave. It's a mess. So the kids not being back in the classroom is just is is causing uh well i mean we're seeing suicides increase we're seeing loneliness increase we're seeing just because the development human development requires interaction with other humans and it's not and social media is not interaction no and especially especially with kids especially with with teenagers and middle school we they are figuring out who they are in relationship with other people and when you take that off it is just like cutting

the string on a balloon and it's off right there's just no way to ground when it's just you and a screen and then you just you go through these curated images of what other people are supposedly doing what their lives are supposedly like and it makes you feel less than and more isolated more isolated more isolated well and then people have digital courage and so they become bullies and mean and other stuff here's another interesting thing when you and i were kids and we ran into a real bully or we all went ourselves, and somebody mouthed off to us. That hurt. And then we went about our day with our friends, and there's just a natural cycle to that.

When it's in black and white text, you read over and over, and you go back to it, and you go back to it, and it re-injures and re-injures. That's another thing. If you lost a grandparent from... So you've got a generation that wasn't connected enough with humans as it was, but on top of that,

you just took them completely and stuck them in a house with COVID, and then they're not going back to the classroom. So the teachers' unions are screwing these kids. Man, I just can't...

I can't find the data, the science that supports keeping these kids by themselves. Even our kid has been back in a regular public school. They've got to wear masks, get to do these things. But, man, he gets to interact with other kids. And he gets to be around other kids. He gets to run around.

They're making up new games, but they're with other people. And I'm hearing stories about, reading stories about teachers unions trying to say, yeah, we'll let them back, but we're going to replace the air conditioning complexes or we've got to fill in the blank and using these moments to try to get other gains for the teachers. Man, my wife's a teacher.

I'm from teachers. I've been a teacher. I'm all about teachers, but it's all about these kids. It is about these kids at the end of the day. That's why we are teachers. That's why I was a teacher. My wife's a teacher because we're about these kids and these about these kids at the end of the day that's why we are teachers that's why i was a teacher my wife's teacher because we're about these kids and these kids are dying on the vine dave it's really it's every mental health professional i know is predicting a

just a collapse of these kids when they go back because they've just been separate for so long and it's just a mess you know one of the things we've talked about and the so long, and it's just a mess. You know, one of the things we've talked about, and the data is there, and it's been there for years. I remember reading it a long time ago, and then you reminded me of it the other day, that teens need physical proximity to figure out who they are. Right. And they even, the thing, if you you've never heard this before it's going to sound strange to you but you're even their heartbeats start to regulate off of each other yeah their eyes look at each other they're the uh uh you know they they not only pick up the

same words and vernacular and those kinds of things but literally the physiology of their bodies is into has to be with other tend to connect yes and when you don't have that, it's not developing properly. That's exactly right. And you don't get that teacher that just puts that hand on the shoulder, that just winks at the kid in the hallway. We used to call it accidental community, where as a teacher you just watch for that one kid who's got his head down, who's not getting it at home,

who's getting beat up by his older brother, who's struggling on heads down, who's not getting it at home, who's getting beat up by his older brother, who's struggling on the bus, whatever the thing is, and it's those little touch points that a teacher can provide, that that school counselor, that school principal, that coach can provide. It's not the academics. No. It's the relational quality. Yes.

Yeah, yeah, yeah. You can get socialization. We can transfer information. That's the easy part. It's talking to the teacher that's showing you, man, you should see my son coming home from history. He is learning the narrative, these stories, and they've come alive. And he's asking questions at home that I never dreamed a 10-year-old would ask. That's because he's got a relationship with somebody that he trusts who's giving him this information, right?

And he could read a book. It would go in one ear and out the other. But this teacher is helping to come alive in him. And so all I have to say is, man, where you can, find ways to let your kids be around other kids. Find ways to connect with your kids. Find ways to get them out with other children running around. This is far more dangerous than the virus. I think it is.

That's a statement I made. Yeah, I can't see a way that it's not, Dave. I have not been compelled by the data on kids. Yeah. I mean, the first time I heard you talk was you talked about screens before COVID. Before COVID, right. I mean, I don't know. Three, four years ago, I heard you do a talk, and you're talking about the damage uh not necessarily from the bullying the bullying's part

of it but not necessarily from that but the damage that this lack of physical proximity to create socialization and proper development in a child 7 to 18, 7 to 27 years old. Think of it this way. We, you know, depending on what stats you read, it's 70 to 90% of communication is nonverbal. Right. And so when you export all of your interaction with somebody to zeros and ones, to text messages,

you're communicating 20, 30%. You're missing shoulder movement and body posture and eye crinkles and this syncing up that we do together right so yeah i have not seen any data that said kids don't need to be back in schools that that covid's just wiping out kids in fact it's been the opposite it's taken out folks who are older who are um not in good health right who have other things going on now of course there's the outliers we hear about so are you seeing the mental health community starting to raise this banner? They've been doing it for a year. All along.

All along. But just not, they weren't getting a platform. There is no platform. And everybody's so busy throwing things up online just so they could see folks, right? Because they knew this crisis was going to emerge. And this is the other thing. Think about if you had someone that you love love your grandparent died in the car wreck the last thing you're going to do is go watch anything that has to do with car wrecks until your until you heal and if your grandparent passed away from

covid or you have someone you love passed away from covid every news story every everything's about covid covid so these kids are just looping on this all day long all day long all day long and those loops just become that anxiety. When you can't take that anxiety anymore, that's when that weight just takes over you. That's when you just sit back and you fade back. And we call that depression. That's when you just unplug from the world, man. And we're just watching it happen with kid after kid after kid after kid.

And at some point, whether you've got to run around and play outside, I don't care how you have to do it, you've got to get your kids in proximity of their kids. You have to, Dave. Even when it comes to church, the Bible says don't forsake the gathering of the believer. Figure it out. I've heard of churches meeting in people's backyard or whatever you've got to do. You need to be in proximity of human beings. Human beings need relationship to function properly.

Got to. It is not good that man be alone. And this is what we're seeing. And we're seeing this in careers. We're seeing it in businesses. We're seeing it with this article. Where was this article out of? Psychology Today.

Psychology Today on the loneliness and depression and suicide rate of teens. Yeah, it's really tough, man. And even this, let's say you're in a city, in a town where you just can't, or you live in a highly compressed city, that means you're going to have to go over the top being engaged with your kid. You're going to have to put your electronics away, moms and dads, and you're going to have to plug in. You're going to have to figure out how to kick a soccer ball in your living room.

You have to do something. The first 30 days binge-watching Netflix was okay. It's over. It's not okay anymore. I'm plugged in. It's not okay anymore. These screens are killing me. Find ways to engage with your kids. I'm out.

Dr. John Deloney, Ramsey Personality. I am Dave Ramsey. Thank you. Dr. John Deloney, Ramsey Personality, is my co-host today on the debt-free stage in the Ramsey Solutions Lobby. Jeremy is with us. Hey, Jeremy, how are you? Pretty good, Dave. Awesome, man. Good to have you. So you're here because you're debt-free. How much did you pay off? I'd rather tell you. $72,042. Love it. How long did this take? 22 months.

Good for you. And your range of income during that time? Started about $35,000, and last year I made $49,000. Good. What do you do for a living? Piano teacher. Good for you. How'd you raise your income that much? In 2018, I started a job at a preschool as a journal music teacher, and I used all of

that income to pay down the mortgage. I was doing triple mortgage payments. Oh, so it's your extra job. Yeah. I was working 65 to 70 hours a week. I got you. Okay. So you paid off your house?

Yes. Wow. I love it, piano teacher. Way to go. It's the only debt I had. The only debt I've really ever had. Wow. That's cool, man.

Look at you, man. And you say a piano teacher for preschoolers? No, that was his extra job. And then the extra job was at a preschool, yeah. Look at you, man. And you say a piano teacher for preschoolers? No, that was his extra job. And then the extra job was at a preschool, yeah. Very cool. What's the house worth? Zillow says about $204. I bought it for $105.

Where do you live? South Elgin, Illinois, just west of Chicago. Okay, wow. Good for you, man. Congratulations. Okay, so two years ago, ding, ding, you go, I'm going to go crazy and pay off my house fast. What happened? What caused that?

I was working. I was a little bit underemployed before I started the job at the preschool, so it was a big boost of income. And I decided I'm not going to work 65 to 70 hours for the next 20 years. So if I get the house out of the way, I can cut my hours down. But I didn't want to give up my business of piano lessons. You may be, with a piano teacher and a preschool teacher, you may be one of the top two or three most patient men in America.

You've got no idea. Wow. You're like a walking Xanax, I think. Probably, yeah. What a gift of humanity you are. Good for you, man. That's fabulous. Okay, so how'd you run into us?

I started listening in 2009. A friend of mine turned me on to the show. At the time, I was 27, making $19,000 a year. And so now I'm up to like $45,000-ish a year. But as you're going along, two years ago, you went, oh, I think I can do this, Dave. Finish off the house. It was starting the job that did it. Because I couldn't possibly at $32,000 or whatever I was making before the job, the second job, I couldn't possibly do much extra.

Yeah. But then you said, oh, I think I'm going to throw some math at this. Ding, ding, let's do it. Oh, yeah. Yeah. That's so exciting. Yeah. Now I'm doing 30% into

retirement and investing, so I'll be all set now. How old are you? 38. Way to go, man. Single, never married, no kids. If you want to put my phone number in the bottom of the screen, that'd be fine. Available and debt-free. Baby Step 7.

This should be a t-shirt. That's right. Baby Step 7 and available. Yeah, yeah, yeah. And debt-free. Baby Step 7, you know, this should be a t-shirt. That's right. Yeah, yeah, yeah. Baby Step 7 and available. Yeah, yeah, yeah. That's good. And super patient. True enough, yeah. Wow. Possibly a saint.

Yeah. I'm just in awe of you. Jeremy, way to go, man. All right. So when someone asks you, you're a teacher, you like to teach, obviously. When someone asks you, how do you you do this what do you tell them i always thought about tomorrow my tomorrow needs to be better than today um and i was raised by my parents and my grandparents instilled always think about the future my grandfather owned a business

um and that's kind of what planted it um you know when i started listening to you you, Dave, I never had a lot of, I didn't have any debt when I started listening. I started in Baby Step 4, which is like, oh, where am I? I'm in 4. All right, I'm doing pretty good. And I just wanted to not have to work so hard. In my job, when the phone rings,

it could be a terrible phone call or a great phone call. And over time, the more money I build, the more wealth I build, the less chance of it being a terrible phone call. And over time, the more money I build, the more wealth I build, the less chance of it being a terrible phone call. The longer I go, I can enjoy my work rather than stress about losing it, which COVID didn't help. Yeah, I lost almost all the income in COVID.

So thankfully, almost all of my customers stuck with me. But I had four streams of income and all of them gone. But they're all back now. No, just the piano lessons. Oh, that's it. And then I had to drive Uber Eats the last year to make up the difference. I was doing 30 some hours on that on top of the piano lessons. Because once you got a goal, you got a goal.

When I first started the preschool, I did the math on your website, the mortgage calculator, to see when can I go see Dave. And it said, pay off December 2020. So I'm like, COVID. I'm like, oh, come on. So that's why I cranked up the Uber Eats. I'm like, I am not going to let this go. And you're still here in early 21. So well done.

Yeah, I know. Yeah. Excellent job, dude. Very good. How's it feel? Great. Yeah. The future's your feel? Great. Yeah. The future is just uphill from here.

No payment in the world. Nope. Nope. Totally weird. Shoveling so much at investments every single month. It's great. Yeah. How much peace and healing are you seeing as these kids come back and can sit with you at the piano?

It's great. Me being one person in their house, it's a normal thing for them. I'm getting a lot of customers like that, that everything else is weird, but I can be normal. Well, I am weird, but you know. Right, right. Yeah. You being there. Yeah.

That's cool. Very cool, man. Well done. Thank you. Very well done. Yeah. So all the 30 hours and the Uber Eats, was it worth it? Oh, yeah.

It was long, but at least I knew that it was for a goal. I wasn't throwing it out the window. It wasn't forever. No. Not a way of life. Yeah. I did the math. I should be able to fully retire at my current level about 54 if I keep shoveling at investments like this.

Yeah. So somebody is driving down the road right now. They're making $45,000 a year, and they got $70,000 in whatever debt. What do you tell them? Just keep at it. Think about the future. Don't worry about today as much, but plan for tomorrow. That's the big one.

You don't want to be – I know people that are retirement age that have nothing, and I am determined not to be that. Well well nobody plans to do that that's true uh they do that by not planning so um yeah you you don't nobody says i'm going to fail on purpose let's do let's get about the business of failing no we don't do that well done i just gotta tell you i mean just your whole spirit i wish i could be in here there's something about you that I can tell you're a great teacher. I can tell you love interacting with people. But you're an encouragement to me today. I'm grateful for you, man.

This is such a cool story. And it's just life kept throwing you a lemon after lemon after lemon. And you were like, I'm just going to drink more lemonade and more lemonade and more lemonade. A year ago, I was a wreck because I thought it was all gone. Oh, boy. But I made it. You got back off the couch and figured it out. There was nothing more rewarding

or fulfilling than getting out of the house and going to work. Oh, boy. Sitting at home. Solves a multitude of sins. Oh, yeah. Idle hands. Idle hands. The devil's workshop. Well done, sir. Thank you. Well done. All right, Jeremy. We got a copy of Rachel Cruz's best-selling book, New York Times bestseller,

Know Yourself, Know Your Money, to say congratulations. Oh, thank you. Jeremy, $72,000 paid off. That's his house and everything. 37 years old. Oh, and he's available. 22 months he did this, making $35,000 to $49,000. Count it down. Let's hear a debt-free scream

three two one i debt free yeah baby this is how it's done i i've threatened to open up our own version of eHarmony for years, and I guess I'm going to have to do it. I'm telling you. That Dave Math will hunt right there. That'll be good. I just, it's just one story after another, Dave.

And I've only been doing this a year, every one of these. I just think it gives me, I drive home. People are inspiring. A little bit lighter. People are inspiring what they can do when they believe they can. Hope is a powerful drug. It is. And he's like, okay, I got knocked off that horse, so I'm going to do a breach.

And I got knocked off that horse, and I'm freaking out, but I'm just going to leave home and go work. And this is how you do it right here. Every day you've got to choose again and choose again and choose again. Ding, ding, ding. Little wins. No one accidentally wins the Super Bowl. What a stud, man. Well done, sir.

This is The Ramsey Show. Thank you. Dr. John Deloney Ramsey personality is my co-host today. Open phones at 888-825-5225. David's with us in Kansas City. Hi, David. How are you? Good. How are you, Dave? Better than I deserve.

What's up? Well, I wanted to thank you guys for taking my call tonight. I just want to talk to you, Dave and John. You too. All right. So I am a registered nurse. I've been working on the front lines of the COVID pandemic. I make about $55,000 to $80,000, maybe $85,000 a year, depending on how much I work.

I owe $105,000 or so on my house. I bought it in 2019. It was valued at $165,000. I'm in school right now, and when I graduate, I'm hoping to make anywhere from between $90 to $140. What will your degree be? Are you advancing your nursing career? Yeah, so I'm going to be a nurse practitioner.

Okay, good. Very good. When will you graduate? In December. Okay, good. Very good. When will you graduate? In December. Okay, good. So this year. Okay. Yeah.

I have a wife and a kid. He's two and a half, and I have another one due in April. So she just stopped working as a nanny and is a stay-at-home mom now. Cool. The schools in the outskirts of Kansas City, Missouri, where I am right now, are not great, and I'm not too excited about growing up in this area, sending my kid to a school that at one point wasn't even accredited. And just as are not as good as the schools over on the Kansas side

that are top 15 in the country. But the houses in that area that I'd be wanting to buy, my Keeping Up with the Joneses house, eventually I can move into are like $400,000 or so. So I'm trying to figure out, I don't mind sending him to those schools now when he's young, but I don't want to send him there when he's. He's two and a half. He's not in school.

No, but he will be. Oh yeah. In four years. Five to 10 years. Yeah. I mean, in four years you'll have your, your, your nurse practitioner, you're gonna be making a lot more money move. Yeah. So my question is, should I take the next three, four years and pay off this house and then save up cash to buy the house before I move? Yeah, that'd be fine.

Or just save up enough cash that you can make the move and then pay off that house shortly after that. Hey, David, listen, David, four years ago, I was two states and three jobs from where I am right now. And if you had told me I was going to be working on a radio station next to this guy, I would have laughed at you. Okay. So, yeah, carry on, man. And I get when you have the second kid and you start wanting to make plans

and make sure everything's going to be mapped out. I can tell you one thing about having kids is you can't map out anything. It just comes. You can do your best you can, and you've got to plan right. But don't – There's no downside to paying off this house and piling up cash. Right. That'll give you options when you're ready to make your move.

But you don't have to sit and fret about it today. You're going to steal joy from right now worrying about something four years from now brother and you may be two states and three jobs from where you are right now exactly okay exactly love the fact that you have a new one on the way be excited about it live in it just pile up cash knowing that someday we're going to move yeah and that there's just no downside to that and then you can either pay cash or almost pay cash and then pay that house off later either want to work all of that's going to work out for you just fine if you uh don't understand something don't buy it and that includes real estate right now a lot of real estate questions coming in a lot of real estate discussion out there everybody around the water cooler is

talking about real estate you can make a six-figure mistake, get educated before you buy. Start by checking out our new 13-step home buying checklist. You'll learn about every step in the buying process from saving a down payment to closing day. Plus, you'll get pro tips on how to make smart money decisions. Text HOMECHECKLIST, no spaces, HOMECHECKLIST to 33789. It's free. HOMECHECKLIST to 33789. Shay's free. Home checklist to 33789. Shay's in Houston. Hi, Shay.

Welcome to the Ramsey Show. Hello. Can you all hear me? Sure. What's up? Okay. Hey, Dave. So glad to finally meet you.

So my question is, I'm 30 years old. I started your plan in 2017, single mother of two kids. By trade, I'm an RN. In 2020, I went gazelle intense, took advantage of the COVID thing, quit working full-time, started travel nursing. My income went from $85,000 to almost $300,000 last year. I grew up super freaking poor, and it's just me and my boys left the toxic family environment, yada, yada. So anyways, I have been hoarding money because I was scared that crap, like if I pay this off, my credit score is going to go down. So basically, I started out with almost $83,000 worth of debt, and I have $42,000 left, and it's only student

loans left to pay. Well, when I paid my car off, my credit score went down. I kind of skipped, not really skipped, but I've got the three to six months obviously saved. So you're doing your plan. You're working your plan. You can't modify my plan and call it my plan. It's your plan. You ever sit in a situation where the doctor tells the patient, do these three things, and the patient goes, I'm going to do two of them.

And they come back two weeks later, and that infection is now the size of a softball. You're like, what did you do? And you're like, well. I only did two of the three. Take that dumb medicine. Really quick, though. I've got $56,000 in my savings. So I was like, okay.

Really quick, how much debt have you got? $42,000 left. So you're debt-free by the time we get off the phone call. What's the problem? I know, but I'm scared I won't be able to get me and my boys a house. Why? Oh, you mean without a credit score? Yes. Oh, okay. Well, just make sure all of your accounts are closed and all of them have a zero balance so that you actually do have a credit score, not just a low credit score. Okay?

Because there's only two ways you can get a house, a high credit score or no credit score. You can't get it with a low credit score. Okay. So you want to make sure you have nothing open. Everything needs to be closed and zero balanced. No outstanding bad debt so that it does go to zero. Because if you go to a mortgage

company like churchill mortgage and you say i have a zero credit score they can walk through what a process called manual underwriting and get you a house the same exact prices you would have gotten if you had a 746 credit score okay okay they can do that okay But you can't do it with a 576. Because that's where I'm at right now because everything's paid off, but it's just like my credit cards are just, you know, just sitting there. They're still open. Yeah. Close them and zero balance everything, and six months later you're on zero score.

Okay. I'm going to do it. Hey, Jay, pull up your credit bureau report. Pull up your credit bureau report pull up your credit bureau report and anything that's on there make sure that account is zeroed and closed by friday hey listen to me listen two things number one at the end of at end of business today, you are free. Got it? I want you to hear that word in your soul. I'm not going to hoard it.

I'm going to do it. Hey, here's the second thing. Yeah. You are not what happened to you as a kid. You are creating a new legacy for those boys. Their story is not going to be your story. You're a freaking $300,000 earner. You're a rock star.

You are H-Town's finest. You you've done it you turn the corner on them don't get held back by those old stories that are going to continue to try to weasel their way into your heart they're done and listen if somebody says if somebody says you forgot your raisin yep let's go i don't eat raisins. Well, I'm so glad I freaking met you, and I want to send a shout out to my friend, Mitch, because he's the one who told me to call. Well, we're so glad for Nick and so glad for you. Yes, congratulations. $300,000 a year.

What a stud. What a stud. Yeah, woman. Yeah. That's a single mom. Get it. Get it. I love it. This is the ramsey show hey it's kelly associate producer and phone screener for The Ramsey Show.

If you would like to do your debt-free scream live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell your story.