The Ramsey Show - App - Knock Out Your Debt Instead of Worrying About Interest Rates (Hour 2)

Episode Date: August 27, 2019

Debt, Home Buying, Insurance   Tools to get you started: Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE   Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Music Music Music Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave 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.

I'm Dave Ramsey, your host. Thanks for joining us. Open phones at 888-825-5225. That's 888-825-5225. Ashley starts off this hour in New Jersey. Hi, Ashley. Welcome to the Dave Ramsey Show. Hi, Dave.

How are you? Better than I deserve. What's up? Okay, so I have a question, more so an opinion on a situation. A little to do with credit, which I know you hate, so please don't yell at me. So I'm 27, a business owner, self-employed. It's my third year. It's just me. I don't have any employees under me. So I'm a makeup artist. I travel all over New Jersey, and I had to buy a car after my first year.

Didn't have any credit, so I actually had to have my dad co-sign on the car with me since I couldn't buy it on my own. It's been two years. I've paid $28,000 off on the car, which I'm really happy about. And my parents actually, a year after I bought it, were trying to go through a loan modification on the house since they were paying more on the house than what it was worth. Long story short, their attorney pretty much dropped the ball, didn't send the paperwork in for the loan to get approved. And for them to get approved, they had to file for bankruptcy. So then the bankruptcy found me in my car and the car was

taken off my credit report. So I tried refinancing twice just to get it back on because I didn't want it to be a total loss. And also my interest on the car was 9%, but I can't get approved for the refinance on my own. So my question for you is more so, should I pay the car off completely, not have it on my credit report, which would just make me debt-free. It's the only debt I have. But I also just, I don't want to do it ahead of time because down the road, of course, I want to be able to purchase my first home and I know credit's a factor in purchasing a house. So I kind of wanted to get your opinion on what I should do. Well, it depends on what your goals are.

If your goals are to have a big credit score and you're not worried about becoming wealthy, all you want to do is just give banks money so you have a big credit score, which is what most people do, then you would keep yourself in debt as long as you possibly can, and you would pay your bill on time and in your name so that you build up your credit score. That's what people do that worship at the altar of the great FICO. Yes. People who build wealth, however, the shortest distance between where you are in wealth is no debt. Mm-hmm.

And not sitting around trying to figure out a way to build your credit score. Because your credit score is basically this. You go into debt so that you can pay payments so that your score goes up, so that you can go into debt so that you can pay payments so that your score goes up, so that you can go into debt so that you can pay payments so that your score goes up. Just a big circle. It's a dog chasing its tail. Yeah.

And that's what most people do, and then they wonder why they're broke. The bank has nice furniture, the bank has a nice building, and they live in a dump. Yes. And that's why. So you can get a home with a zero credit score if you have paid all your bills on time your landlord earlier on time you have a sufficient down payment and you've got two years of tax returns showing that you have an income that is worthy of that home you do not have to have a credit score to get a home now you do with some mortgage companies because they don't know how to do

manual underwriting you get in touch with churchill mortgage and they can help you get a home. Now, you do with some mortgage companies because they don't know how to do manual underwriting. You get in touch with Churchill Mortgage, and they can help you get a mortgage with manual underwriting, it's called, and that can be done. So, if I woke up in your shoes, I would reverse the stupidity here that's been going on by paying off this car as fast as possible. How much do you owe on it? $13,000. as possible uh how much do you owe on it uh 13 000 i actually have the 13 000 in my bank account so i could pay it off today perfect do it i actually currently i have i have the emergency

fund um i i currently i actually have 60 000 in my bank account but i was just i i was i didn't i didn't it not it's not a total loss for the car because I just want to keep that free. Yeah, it is. You paid a ridiculous interest rate. You got drugged through a bankruptcy. You've gone through all this crap, your parents' bankruptcy. You know, you've gone through a bunch of crap here to buy a car that really, at the time, you couldn't afford. And so, you know, you just know it is a total loss. The only thing that's not a total loss is if you learn from your mistakes and realize they were mistakes is the only way you could learn from them.

So, now, this whole story is a nightmare. But the only good part of the story is the end of it and that you have the money because you've been making really good money. And so you've got a little pile of money here. So I'd pay off the car today. And then I would begin my wealth building process if I were you, and stay out of debt. And, you know, pay your landlord earlier on time. Continue to pile up cash. Make sure you're filing taxes on your actual income.

No lying to the IRS. We're all tempted to because we hate them, and we hate the taxes. But, you know, no lying. Tell the truth because you're making good money. And when you show that for two years on a tax return, even if your credit score is zero, you will qualify for a mortgage if you find a mortgage company that does manual underwriting like Churchill. That's what we teach here. Adam is with us in Kansas.

Hi, Adam. How are you? I'm good, Dave. Thanks for taking my call. Sure. What's up? So I'm 27 and my wife is 30. We have zero student loan debt and currently have paid off about 34% of our house.

It's a 30-year loan. We have a fully funded emergency fund in place with savings still available. Do you think it would be wise for us to pursue refinancing for a 15-year loan? Not unless it saves you on interest rate. You can pay your mortgage like a 15, and it'll pay off in 15. Okay. What's your current interest rate? 4.25.

Okay. You probably can save a point. What's your balance today? About $50,25. Okay. You probably can save a point. What's your balance today? About $50,000. Oh. So one point's $500. Okay. Yeah.

And how quick are you going to pay this off? Oh, well, currently we've, so since we started, we doubled, or we're currently paying double what the mortgage payment or the mortgage company has asked us. We still have only paid off about $8,000 in three years, and we have already paid, gosh, upwards of $10,000 worth of interest. And so we're thinking we'd try to like to lower that interest if at all possible. Well, I mean, if you lowered it 1%, you would be saving five hundred dollars a year okay okay so interest really isn't your problem you don't have much of a balance uh so how quick are you going to pay off fifty thousand dollars

uh we believe we could uh have it done uh within uh we think we could have it done within uh five to ten years roughly. I think you'll be done in five years is what I think. And I think if you refinanced, you'd get your refinance costs back. What's your home worth? The home is worth about $74,000, but we've made about $15,000 to $20,000 worth of repairs. Okay.

Well, if it's worth more than that then if you made repairs. So hopefully. thousand dollars worth of repairs okay well if it's worth more than that then if you made repairs so hopefully so uh if you wanted to get a home equity loan with no closing costs fixed rate that was lower interest rate than you have now on a 10-year loan i would be okay with that otherwise i just sit where you are and get it paid off you're not in an abusive situation. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable affordable biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM,

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When we come to your town, it's a pep rally for you. We're going to walk you through the baby steps. We're going to laugh. We're going to cry. We're going to tell stories. We're going to make you understand that you really can do this, and you will leave with a renewed sense of you can really do this. You can really win with money, and we're going to show you exactly how to do that

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We've seen people just like you win. We've shown them what to do, and they went and did it. Millions of you. So if you're in the middle of your baby steps and just need a jolt, if you're fighting and scratching and clawing and hustling and grinding hey i understand been there too come out to one of these financial peace live events chris hogan and anthony o'neill will be doing the first three in austin texas september the 12th tacoma washington october the 2nd. Phoenix, Arizona, October the 10th. Chris Hogan and I will be doing the one together. I'll be in Charleston on November the 20th.

Big Charleston, South Carolina. Seats are on sale. None of these events are yet sold out, but they are all, I looked at the report just a few minutes ago, they are all trending towards an early sellout. Austin, Texas, Tacoma, Washington, Phoenix, Arizona, Charleston, South Carolina. Just go to DaveRamsey.com slash events, and you can find out everywhere. We're doing events of all kinds,

but those are the four Financial Peace live events starting here in about a couple of weeks before you know it. We'll be right on that September 12th hit right there in Austin, Texas. That's going to be a wonderful event. Already over 1,000 tickets sold to that one right there. So fun stuff. DaveRamsey.com slash events. Oh, Ramsey Concierge Team can help you too.

Just call them at 888-22-PIECE, 888-227-3223. Our question of the day comes from blinds.com, the number one online retailer of custom window coverings. You get free samples, free shipping with the new promos they run every month. You'll save even more. Use the promo code RAMSY to get the best possible deal. I actually did this. I got the free samples, got some blinds that are um they're

electric but i didn't have to hardwire them they're battery operated you recharge the battery it's the coolest thing they're for shades is all they were just shades for an outdoor patio thing but uh pretty cool stuff check them out blinds.com you'll like the deal you'll like the quality you'll love the service you'll love the company today's question comes from julie my husband and i recently turned down for a new home construction loan we own our property free and clear worth 180 000 we're being offered a 25 000 hard money loan my husband is skeptical what do you think oh i'd be skeptical that's some hard money is translation they're getting ready to get you i don't know why you're turned down for a construction loan

unless you can't qualify for the permanent loan so you need to get lined up and qualify for the permanent loan first uh and you know then the construction loan will come easier so it sounds like you got a good situation with the house or with a lot free and clear but no i wouldn't do a 25 000 hard money loan besides that how you gonna build a house for 25 grand on 180 000 piece of land that does that's not that doesn't work so anyway there's details here i obviously don't understand or don't have but uh if you've got that much money saved and you're within 25 000 of building and cash, just wait and pay cash. You're almost there.

If you got turned down for a construction loan, find out why and make those corrections. And, no, you don't need to build your credit. It could be that you just had a bank that didn't know what the flip they were doing. So it's not any harder than that. James is with us in Georgiaorgia hey james welcome to the dave ramsey show hey dave thanks for taking my call sure how can i help um i have two cars um i'm upside down on both of them um for me to get out um about three grand and four grand upside down um and for me to buy new cars as well, beaters would be $3,000, $4,000.

I'm looking at about $12,000, $13,000 cash just to get out from underneath. I can't quite figure out how to do that. What do you owe on car number one? $4,000. You only owe $4,000 on it? No, no, no, no, no, no. I'm sorry. I owe $12,000.

Oh, and you're four upside down. Correct. I could sell it for about $8,000 on it? No, no, no, no, no, no. I'm sorry. I owe $12,000. Oh, and you're four upside down. Correct. I could sell it for about eight. Okay. And what about car number two? I owe $10,000. I could also sell it for about eight. Okay.

And what's your household income? $65,000. Okay. I wouldn't sell them. I'd just work them off. Let's just get them paid off. Just get them paid off. Yeah, put them in your debt snowball and attack them.

And if you want to trade cars, after you get them paid off, you can trade cars and pay cash for your trade. But, you know, these cars, they're a little big, but they're not killing you. They're not single-handedly taking you down. How much other debt do you have? I actually have no other debt at all oh that's great okay um i i mean i do have more expenses coming up with a child on the way so that's also kind of scaring like the expenses wise they're going to go up a little bit yeah yeah okay my income is not going up well here's the thing it does it is if you take an extra job.

The thing, if you get on a good, hard-written budget, we have people calling in here doing debt-free screams all the time that pay off more than $20,000 in one year, making $65,000. Now, you have no life doing that. It's a scorched-earth budget, okay? That means there's nothing going on except debt repayment. You work and pay debts and sell everything in sight, right? And so you have a garage sale. You look around for anything else I can put on Craigslist.

I take extra jobs. I work like a crazy man, and I knock this stuff out as fast as possible. But you can do it in about a year. When's baby due? November. Okay. I wouldn't do anything except just pile up cash until November and pay your car payments. Once baby comes, then I would get in attack mode on this.

Got it. So you're saying I shouldn't really attack it until after the baby comes. Exactly. I'd rather just pile up cash, have a big pile of savings, then use that savings to pay the debt down because you may not need the savings. Hopefully you won't. But in terms of actual labor and delivery have you got you've got insurance i assume yes okay how much of the labor and delivery does it cover um i honestly don't know be a good thing to know

before november it's it's a insurance. It's still under her parents. She's under 26. Yeah. Well, that's wonderful, but we don't even know what it is. So how do we know it's good insurance? So you need to get in there and figure it out, find out what you're going to owe out of pocket as a result of this. Make sure you're ready for that.

Anything above that, we can throw at these cars after baby and mama come home and everybody's healthy. So this is your first baby? Yes, yes, sir. And how old are you two? I'm 27. My wife's 26, 25. Okay, awesome, awesome.

Well, you're doing really, really good. Have you heard of our class, Financial Peace University, that's nine weeks long? Yes, I have not gone to it, but I have definitely heard of it. Okay. Would you and your wife go if i gave it to you free uh we probably would yes sir okay we'll probably won't do it i'll give it to you if you'll go yes we will go okay and then someday when you're rich and famous you find a young couple with their first baby on the way and you pay for it okay but in the meantime it's my

gift to you and to the new baby so you hold on and kelly will pick up and we'll get you signed up not only for the nine week class which is just the start of the experience but it also includes you know membership to every dollar plus which is 129 value all the communities all the coaching you also get the other classes the legacy journey smart, Smart Money, Smart Kids. I'm going to give all of that to you, all in that membership. And it just starts with the nine-week class. And then that just begins your experience.

So, very cool. Hey, thanks for the call. Open phones at 888-825-5225. This is The Dave Ramsey Show. We'll be right back. John is with us in Michigan. Hey, John, welcome to the Dave Ramsey Show. Hey, Mr. Ramsey, I appreciate you taking my call. Certainly, sir. How can I help? It's a long story short.

My wife and I got married about five years ago and took financial peace pretty much right after we got married, but decided that we were smarter and didn't want to follow what you had to say, which I regret. So then about a year ago, we really started picking up, uh, with your baby steps. Um, and we're certainly on baby step number two. Um, while, uh, in that little time of rebellion, I, um, decided to lease my truck. Um, and my lease is coming to an end here very soon. Um, trying to figure out what the best option for me might be. If I were to buy it outright at this point, I'll pretty much break even if I were to sell it right away. It's worth

about $25,000. I owe about $25,000. If I were to turn it in and just drop the keys and walk away, I'm looking at about $7,000 in over-mileages fees and things like that. So I'm trying to figure out what the best option for me would be at this point. Wow. Yeah, you ran this thing into the dirt. Right. What's your household income? Last year we were about $110,000.

This past year we had our first child. My wife's gone back to work part-time, so it's going to be quite a bit less than that. I'm going to guess probably around $90,000 if I had to guess for this year. Okay. And how much other debt other than $20,000 on the truck do you have? $12,000 in student loan and that's it. Okay. So 32,000 makes you debt free and you make 90. Correct. And, uh, that puts you out of debt when? Uh, my goal before we realized we were having a baby this year was to try and be at that by 2020.

I'm looking probably by March, but my goal of 2020 now, that would be without would be without the truck, without the truck included in that. Yeah, but if you did the truck, it's another year. Yeah, at least. Yeah, no, you can pay off $20,000 in a year and make a 90. Okay. If you can't, you're not doing your budget right. Okay. Yeah, I would keep it and just refinance it

or go get a car loan and pay it off. But I want you out of debt 100% in about 18 to 24 months. Okay. If you're not going to do that, then you need to sell the truck. Right. I guess my fear would be that my monthly payment would probably be more than I would be comfortable paying at this point, which is why I was looking to try and sell it outright. Wait a minute. I'm confused.

I'm confused. If you're going to pay off $32,000 in debt in one year, that's about $2,500, $2,600 a month. If you're going to do it in two years, it's $1,200 a month. Irrelevant, your payment is irrelevant because you're going to be paying a lot more than your payment. Right. If you want to get a hoopty so that you can get out of debt faster, then you need to go get a truck loan and then immediately sell the truck because that saves you $7,000.

For sure. Okay. Okay. And then you basically are down to the student loan and you go buy you a hoopty for a thousand or fifteen hundred bucks but um i don't like how you got here for sure but uh but the the story's ugly but we go only from today forward right other than other than looking at the past and trying to analyze and say have you learned your lesson you know it sounds like you have so if you're willing if you guys are willing

to roll up your sleeves and pay you know fifteen eighteen hundred dollars a month towards debt you will be debt free on thirty two thousand in about 18 months. Okay. And that means you're going to be on beans and rice, rice and beans, be on a written budget, get the every dollar budget out. You're actually going to use it, and the two of you are going to work together to cause this to happen. And we're not going on vacation. You're not going to see the inside of a restaurant unless you're working there. And you do that anyway until you get rid of the student loan, period.

But then when you get to the car you know if you're willing to sacrifice for another 10 or 12 months you can clear this car and it's not an unreasonable car in your situation it's just how you got to it is unreasonable right okay so but if you if you're willing to do that and pay it off, I would just keep it. But because, again, a $20,000 car making $90,000 is not out of the range of reasonableness. So you just make that call. You guys decide what you want to do. But at a minimum, you do need to finance the truck at the end of the lease and then turn around and resell it or say, we're going to pay it off in one year. And we're just going to finance it on whatever. I don't care.

Finance it on three years, but pay it off in one year. And so go ahead and start working on the loan at the end of the thing. And then you guys start looking at your budget and go, are we willing to punch this thing, punch our life that hard, in order to get this truck cleared. Lila's with us in Idaho. Hi, Lila. Welcome to the Dave Ramsey Show.

Hi. Thank you for taking my call. Sure. What's up? So my husband and I each have one whole life insurance policy. I'm sorry. And one term life policy. Okay.

Well, maybe you've already answered my question. So my question is, we've also taken one out for each of our children. We have two children. And I'm wondering if we need to cancel them for ourselves. Okay. And then do we just take out an extra term policy to equal that amount? Yeah, on you guys. Do you have your emergency fund in place of three to six months of expenses? Not yet. We are working on that. How much cash value do you have in your horrible whole life policies?

Well, so for my husband, it is $500,000. No, no, no. I said cash value. How much will you get when you close the policies? Oh, I don't know. I guess I didn't understand that they worked that way. Okay. All right. If you've got whole life life insurance at $500,000, how old is he? He's 37. And how long have you had it? Only a year and a half. And what are you paying a month?

It's $53 a month. That is not whole life. Okay. That's term. Okay. I don't think. I'd be shocked if it is. Who's it with?

What's the company name? Ohio National. That's probably term. i don't know you need to get into it and dig into it a little bit further and see term life insurance is only life insurance it costs about a nickel on the dollar meaning that and all it does is pay if you die that's all it does okay it's like car insurance the only time you get car insurance money is when you wreck your car. The only way you get life insurance money on term is you die. Okay? And whole life life insurance is 20 times more expensive.

So instead of $5 a month, it's $100 a month for the same amount of coverage. Okay? coverage okay and that extra 95 dollars goes into a savings program called cash value that sucks horrible savings program pays about one percent has very high fees and when you die they don't give you the savings and you paid extra to get it it's a horrible product so i don't know what you've got exactly uh but uh what you could do is go to zanderinsurance.com and just price out term insurance on you guys and then that'll begin to tell you what you've got but that sounds inexpensive for whole life on a 37-year-old, to me. But you can look into it.

It's only $600 a year. Now, I think you might have some expensive term is all you've got. But anyway, life insurance on children, the only thing you would need is just enough to cover a burial if you don't have any money. And you can get that as a term rider, a child writer on your term policy. So what I would tell you to do is go to Zanderinsurance.com and shop some insurance rates. And I think you're going to see you can get a lot better deal than you've got today. But I'm not sure you actually have whole life. So a good question. Thank you for joining us. This is the Dave Ramsey Show. Thank you for joining us, America. We're glad you're here.

Open phones at 888-825-5225. That's 888-825-5225. Josh is with us in New York. Hey, Josh, welcome to the Dave Ramsey Show. 888-825-5225. That's 888-825-5225. Josh is with us in New York. Hey, Josh, welcome to the Dave Ramsey Show. Hi, Mr. Ramsey. Hey, what's up? I got a question.

I am currently a farmer on a dairy farm in New York. It's our family farm. I only get paid about $2,400 a month, which is like 20, I think it's like $28,000 a year, but we also have to pay all of our own taxes. We have a lot of equity in the farm, about $40,000 worth of cattle, but we don't get paid a lot and we just don't see much of a future with the farm. Are we better off staying with the farm and riding it out until the end? Or because of the equity, because our cows grow every year, we get more and more cows every year, so we get to keep that money? Or are we better off leaving and finding something else?

Well, my friend Henry Cloud wrote a book called Necessary Endings. And what you're in is a very emotional situation. To end this is going to be hard for you emotionally, probably be hard on some of your family members, probably be some tears, right? Yeah, that's kind of another factor in it. it would probably split the family pretty hard if we left because it's me and my wife and her brother and it's the grandfather's farm and yeah that's just i don't think it wouldn't end well but we don't we feel like if we leave now and it does fail they're gonna blame it on us for

leaving because we'd have to sell out all of our cows which we'd make up we make up quite a bit of the herd of ourselves yeah but if we don't leave i feel like we're never going to get financially anywhere because we just we don't have any debt fortunately we we rent our we rent to lease our house from one of the family from the family member of the farm so we don't have any debt there and we're going to buy that house but how long have you been on this farm um since i was 12 and i'm 21 i married his granddaughter and uh we just had our first set of twins born this year um and we just we don't know i mean i have enough skills that i could go out and get another job somewhere, but I don't feel like if I leave the farm, I feel like it's going to cause a huge problem, and I just don't know what's the best solution here.

Yeah. Well, the necessary endings, it might be a book you'd want to pick up. Matter of fact, I think we've got some. I'll just send you one. Okay? But the chapter in there, one of the chapters in his book, Necessary Endings, anytime you come to a point where you have to end some kind of thing you're doing, a relationship, a career, a job, whatever it is, you've got to bring it to an end.

The reason you would end it is you have lost hope that it's going to get better and um josh at 21 years old you've already lost hope this is going to get better yeah you work in the yeah you work about three hundred thousand dollars worth of debt already and i don't think it's going to pull out of it so you work like a crazy man what the work you do is very hard work and it never lets up dairy farm is a tough job you don't make any money and you have twins and you don't see a future where this is going to change i mean if you were making 28 000 and we thought you were going to end up making $200,000, we'd hang on, you know? But the problem is, you could be 50 years old and still making $28,000. That's what you're telling me, right? Yeah.

Yeah. So this has got to come to an end. Now, here's some help for you that'll help them stay afloat and it'll help with the um uh with the hurt feelings and the worry and the relationships the slower more gradually you make your moves uh the better off you're going to be as far as the relationships go and their chance to to do this and so you don't walk in and give two weeks notice in a situation like this no that would be unfair and you would expect to have permanent damage to relationships if you did because you're going to leave them in a lurch so instead you go you know have with, you know, your brother-in-law that you're in the deal with, the grandpa,

and just say, I don't think this is going to get better, and I don't want to work for $28,000 for the rest of my life. This is not working well. I do not see a future. So I'm going to go ahead and let you know that we're going to begin a transition period to move me out. I want to help you. I want to do this in a way that doesn't bring harm.

And I want to do this in a way that you guys have time to backfill for me and that kind of thing. And so, you know, I'm going to go ahead and let you know that my timeline is like six months. And as far as the cows go, we're going to sell those off over two years. You're not going to sell them off all at once. You're going to just let him use them. Yeah. And you'll sell them off gradually, a little bit every two months or a little bit every time you want to go to market, okay,

where you don't just punch him and leave big holes in his operation, but it's a gradual transition that allows him to make adjustments for you not being there and either to buy these cows off of you or to at least make adjustments to know that they're not going to be there because you're going to sell them. And I guess my last question was, when I do sell these cows off, should I use that money to buy my house or should I use that money to invest, I guess? We don't have any other debt.

We own everything we have. Yeah, I would make sure I had an emergency fund in place, and I would use it then past that to start uh make sure you started your investing started your kids college and then baby step six we call it is to pay off the house and uh to get that paid off would be a good thing because it's all tied into this family mess too right yeah it is yeah you may not even end up staying there that's possible yeah depending on what career you choose that's the other thing where are you going to go i don't know i'm i'm skilled in enough of other stuff that

i could get a job pretty easily but it's just i've been all i've always held on to the farm because it was a family farm and we always had the dream of being here and everything but as these last few years have gone on the farm has gotten into more and more debt the problem is the dream is becoming a nightmare. Yeah, it's just it's not equipment debt like that we could just sell and get out of. It's just past line of credit debt that we can't pull out of. Yeah, it's just a mess. And it's a very, very hard business.

It's hard work. There's no relief. You've got to milk those cows. You don't have a choice. They don't know there's a very, very hard business. It's hard work. There's no relief. You've got to milk those cows. You don't have a choice. They don't know there's a holiday. It's got to happen. And so it's admirable work because it's back-breaking work. But you need to have a place you're going to go and a plan to get there six months from now.

And you give them like a six-month notice. And then you say, listen, if you want to buy these these cows off i'll sell them to you by the month uh i'll sell you you know whatever they're worth per month out of them and i'll sell you a few a month until you know i'm not going to pay payments on the 40 000 that's not what i'm talking about but instead you say okay how many how many cattle does it represent how many head do you own about 30 35 yeah okay well i mean you could put it on one a month you know and say three years we're going to walk out of this buy one cow a month and um if not every so often i'm going to take a load to market and uh every three months or whatever i don't know how often you would do that in your world in that situation i don't know how often they they you know how often there's a market

a good cattle auction for dairy cattle in your area but you'd find a buyer every three or four months and sell off three or four of them if he's not going to buy them one a month okay but that gives him time you're not just all of a sudden jerking you know the majority of the herd out and leaving him with nothing to work with so you can afford to be gentle and gradual you're in a position of strength to do that that will help lots of notice and make everything gradual and that'll help with the transition here and um you know you can start the conversations with i know you love me and you want good things for me and so i know you're going to understand this because i feel stuck here i don't think we're going to make money and it's time for me to go a

different direction with my career but i'm going to do it in such a way that it doesn't bring harm to you folks because i love you. That simple. But that's how the conversation sounds. Hold on. I'm going to have Kelly pick up. We'll get you a copy of that book, Necessary Endings, because you have one, sir. This is The Dave Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show.

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