The Ramsey Show - App - Learn to Say "No" to Yourself (Hour 1)

Episode Date: December 13, 2019

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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. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. Starting off this hour, Richard is with us in Asheville, North Carolina.

Merry Christmas, Richard. Thank you. Merry Christmas to you. Thanks for taking my call. Sure. What's up? Well, I've got a question. My current job is basically I'm not making enough and trying to figure out what the best

decision is going to be. I currently am kind of running a side business, and I'm trying to figure out when the best time or if there will be a time where I can make the switch to full-time self-employment. I just kind of want to get your thoughts on that. I don't know if I should rattle off a bunch of details. You just ask me what you want to know. Mathematically, when you can quit your full-time job and make your side hustle, your full-time gig, is when you get the boat close enough to the dock, income-wise, that you can step into it instead of leap towards it and get wet.

You know? And so I have people call me up and go, well, I started my side hustle and I made $600 last year, and I make $60,000 at my job. Well, you can't make that leap. You've got to get your income up, you know. But I have other people call up and go, you know, I made $46,000 at my side hustle and I make $50,000 at my full time. And I'm like, well, I mean, that's not a leap. That's a step, right? And so what's your numbers?

What do you make at your day job? Well, I make, I'm a mechanic by trade. Basically, I took a local job at my state garage, and I'm making $40,000 a year. Okay. What do you make on your side job? I'm averaging, starting from my numbers of last year, I'm bringing in about $1,000 a month. Okay. Working just, you know, that's nights.

Some weekends, that's not much. That's about all you got. I mean, you're working a full-time job other than that, right? Right, right. What is your side hustle? What are you doing? It's the same. I actually built a garage on the property at my house.

And, I mean, it's a full- a full blown shop It's got a lift, everything I've just been kind of fixing cars on the side You know And It's close to the main road I think you have the makings Of something that will allow you to quit I don't think you're there yet

It's probably going to take you 12 more months And here's what you do during the 12 months let me tell you what i heard and see you tell me if i'm wrong okay okay i think i heard a guy who is very good turning a wrench mechanical things come easy to you you see them a car rolls in you have a sense about it you have the equipment you have a good, you have a sense about it, you have the equipment, you have a good location, you have the building. All the stuff about working on the cars and actually producing the product that your business produces, you've got it locked down, lights out. What you're not doing is bringing in any business. You're not marketing.

When it came to marketing, you said, oh, I kind of work on some cars. Yeah, I've got them. I mean, I've done a little bit in marketing. I mean, I've got a website, and I've got quite a few five-star reviews on Google, things like that. But I think that some of the issues is that. What have you got to do to get your volume to 35,000, 36,000, triple it in the next 12 months? Well, I mean, it would be hard because, I mean, obviously, as you know, there are only so many hours in a day. And, I mean, as of right now, I think the reason that I'm considering it is that I don't see my family much because I'm having to work so much. I don't want you to work like that for the rest of your life.

But I want you to work like that for enough that you know you can make a living when you quit. Okay. I don't want you to be irresponsible. You've got to feed this family. Right. If you make $12,000 a year after you quit, you're screwed. Yeah, exactly. Exactly.

But I know that I feel like, you know. I don't. I know you know how to work on cars. I don't know that you know how to get business in there. Yeah. Because you've never gotten it in there. Mm-hmm. Listen, I'd bring my car to you.

Just in talking to you, I think you could work on it and fix it. But I wouldn't hire you for marketing because right now you still suck at that. Sure. Yeah, that's fair still suck at that. Sure. Yeah, that's fair. That's fair. Okay. Seriously, go make some money and prove it to yourself, and then you can quit and completely control your income and your time and everything else.

But you tell the family, you get the wife on board, you sit down. How old are your kids? I've got a one-year-old daughter. Okay. Well, she's not even going to know. But you're going to see her more than she thinks you're seeing her, more than you think you're seeing her or whatever. You sit down with your wife and say, okay, if I bust it for a year,

I think I can get this thing up to where it makes sense so we can quit, and I'm not being unwise and leaving us out in the cold. I've got to get this up above 30, though. Because if you can get it up above 30 while working a full-time job, you probably make 60 or 70 when you quit. You probably could flip. But you've got to learn to get the business in there. Yeah, yeah.

I think the other part of my question is also that my current job, it's a state job and I get benefits through that. Oh, that's a bunch of crap. Drop all that. Okay. You need to run your own shop. Okay. You make $70 instead of $40, and you control your life.

You can buy health insurance in retirement. Okay. And you'll end up richer anyway than state retirement, I'll get you. And guess what? When you want to raise, you just hire a new person in there to help you turn a wrench you grow your business and when you want to raise at the state you get three percent right right so you control yeah you control your destiny here man i want you to do this and it might not take 12 months but if you can have three three3,000 months in a row and you think you can keep doing that, you're there. Okay.

Instead of three $1,000 months. Yeah. Yeah. I wonder, is there, last thing, is there, I've run into one issue, kind of a hiccup that I've had. I got a zoning violation notice from one of my neighbors who complained. They didn't like that I'd been working on cars. I didn't know. It's outside the zoning for you to have a shop there?

Well, not a, I mean, it's my personal garage. So, I mean, I'm allowed to do that. But if you open a shop, you can't open a shop there. Right, right. A commercial repair facility is right. Yeah, you'd have to go rent something to open your business then, right? Yes, legally, yes. I mean, if I just get it on the side like I'm doing, I mean, it's fine,

just because it's obviously low volume. So I don't know kind of how that plays out. Well, it means that part of you going full-time is you've got to have your location figured out. Because if you're making $3,000 a month but your rent is $4,000 a month, that ain't going to work. Right, exactly. So you need to start shopping for locations of where you're going to land as part of making this jump to full-time. Because you can't do full-time out of that. That's what you're telling me.

You've got a zoning violation. You're not going to be able to do it. So, I love it, man. Keep fighting and scratching. Keep clawing. You can do this. This will work for you, man. You're what America's about.

Get her done. This is the Dave Ramsey Show. How often can you get the best of both worlds? Not very often, right? Well, with the rate secured program at Churchill Mortgage, it's possible. You can secure a low rate now to nail down your budget, and if rates drop while you're shopping for a home, they'll give you the lower rate. That's right. They take on the risk of fluctuating interest rates, not you. Who does that? Well, you should fall in love with the numbers before you fall in love with the house. This program lets you do just that. So if you're buying a home this year, you'd be crazy not to call Churchill and get your

rate secured now. Call Churchill Mortgage today and have the best of both worlds. Go to ChurchillMortgage.com or call 888-LOAN-200. That's ChurchillMortgage.com. This is a paid advertisement.mls id 1591 nmls consumeraccess.org equal housing lender 761 old hickory boulevard printwood tennessee 37027 David is in Cedar Rapids, Iowa. Hi, David. Welcome to the Dave Ramsey Show.

Thank you. Good to talk to you. You too. What's up? I wanted to get your just an objective opinion here on whether I should sell my house or not. The thing is, I'm over-the-road truck driver, so I only use it about two days every six weeks or so. I've used your method of if I had the cash today, would I buy it? And I probably would not.

Okay. But I have a renter. It's a duplex, and I have a renter. So basically it comes down to I'm only paying out of my pocket, including utilities and everything related to the house, upgrades, et cetera, I'm only paying like $450 a month for this thing, which, you know, you cannot find anything for that price. Agreed. Okay.

What do you make a year? Well, I have per diem and all that, so it's all kind of weird, but cash in my bank account is about $1,000 a week, so $52 a year after taxes and everything. Gotcha. Okay, cool. And how many bedrooms is each unit in the duplex? One is a one-bedroom and one's a two bedroom. You have the one? I actually have the two bedroom. Oh, okay. Okay.

Um, well the two bedroom would bring more rent. Right. I, it's, um, I have a, the person that's renting from me has been, you know, she would, she prefers the one bedroom because it's cheaper. But she's been, she's been there for 10 years on, you know, and she's on social security. So she takes care of the lawn. She takes care of everything for me while I'm gone. What about renting out one of your bedrooms? Like a roommate that you never see because you're never home?

Well, I thought about that. I'd really rather not have someone I don't know that well in my apartment with all my stuff. I agree. I'm not going to be there every, but once every six weeks. Okay. All right. That's fine. It's not that big an expense.

You can handle the expense. It's just a matter of whether you want it or not. I mean, there's no slam dunk answer here. Like, oh, you're crazy for having it, or, oh, you're crazy for not keeping it. There's no, you know, there's no wrong answer. As you said, it's not much out of pocket. You know, it's about $5,000 a year out of pocket. It's fairly expensive for no more nights than you spend there, actually. But it is going up in value.

You do have a renter. I think if your renter situation ever changed, I would move into the one-bedroom and rent out the two-bedroom, which would mean less out of pocket even. That's what I was suggesting. Obviously, you like this tenant and you don't want to kick them out, but it's going to change someday, and when that changes, I would move it. I would move over to the one-bedroom side and rent out the two-bedroom side, and then you've got even less out-of-pocket.

If you're going to keep it, that's what I'd do. Amber's in St. Augustine, Florida. Hi, Amber. How are you? I am good. Good. I have a St. Augustine, Florida. Hi, Amber. How are you? I am good. Good. I have a little bit of a complicated situation. Well, I have a home in St. Augustine that we currently vacation rent,

and it brings in a profit of about, after all our expenses, about $10,000 a year. My husband and I, we just recently, within the last couple of years, moved to South Carolina, where we rent a place for $1,200 a month. We just needed a life change, and he started a business there, and he worked for the Sheriff's Department, and everything's been great with that. Well, we're considering selling the house in Florida because we could pay off all of our debt and have about $40,000 in the bank because we're just tired of it. We're done with the whole debt thing.

And you could buy a house in North Carolina, right? Or South Carolina. Yeah, we could. South Carolina, yeah, we could. But the situation is we owe about $250,000 on the house. And the reason why we kept the house is because we have two of our daughters, which are adopted. They have free college in the state of Florida, and they also have free health care until they're 18. And we also get an adoption stipend for them.

So we keep the house, kind of go back and forth to keep our residency in the state of Florida. So it's weighing on the debt or paying, you know, having a college. How old are your daughters? Seven and eight. Okay. We've had them since they were babies. Sell the house. You're not a resident of Florida. Yeah.

You're lying to the state. Well, we're there. I'm there more. You have to be there six months and one day to be a resident, and you're not there six months and one day. Okay. So we'll sell the house. Ask the state what they think,

but I think that's what they're going to tell you, that you have to be there six months and one day to be considered a resident. Okay. And you don't want to get money by lying yeah we weren't concerned so much about the money it was just we were thinking you know if we kept the house we'd come back whatever but it's been working out here so well you were concerned about whether you're going to get the free health care and the free tuition yeah that too yeah that's money that's what i'm talking about okay and you're not due that if you're not a resident and i don't Yeah, that too. find that i think you're going to find residencies established after it by staying six months and one day in that state to establish residency that's what it is in most states in most situations again i'm not an expert on the details the nuances of the florida adoption law but uh if that's the case

you you know you would be taking the money um by having not told the truth and you don't want to put yourself in that position i'd sell the house house. I surely would. Hey, thanks for the call. Open phones at 888-825-5225. Angela is in Little Rock, Arkansas. Hi, Angela. How are you? I'm doing great, Dave. How are you?

Better than I deserve. What's up? I'm so happy you took my call. I am, me and my husband are in Baby Step No. 2, and we're a little shy of three hundred thousand dollars in debt whoa counting them in baby step two you are counting their house well our we they we're in a trailer right now that my husband bought for his parents 20 years ago and it's still we still owe about 30 33 what do you owe $300,000 on? Credit card, personal loans, student loans is the majority of it.

It's $132,000 student loans. Good Lord. What's your household income? Net $99,000. That's good. Okay. So you're working your way through $300,000 in debt. Yes.

Oh, my goodness. Wow. How can I help? Well, my husband wants to take. He's 59. He can take out some of his money out of his TSP. And he wants to take $50,000 and put on some property that we own and put a veteran's home or something,

a piece of real estate, I would just say, and to house veterans. It's a real sweet sentiment, but you're broke. Yes. No. Okay. I mean, he's a good man and he's got a good heart, but, you know, you're $300,000 in debt. You make only $100,000 a year.

You're not in a position to start building homes for a nonprofit to help veterans. You're broke. And kind of what I told him that I thought we could do is to rent out. We have a five-bedroom trailer that we remodeled ourselves. It's sitting on five acres of land, and we could rent out we have a five bedroom trailer that we remodeled ourselves it's sitting on five acres of land and we could rent out those bedrooms and move into an apartment and we would make income off of that versus uh and that's something we already have and we could take a little money and just fix up the little things that we need to finish on that but it's perfectly fine

to have some renters in and start his business there yeah um that'd be okay i guess i'm not real thrilled about any of this honestly i'm not real thrilled about trailers that go down in value and keeping them um and i don't you know he needed if it's a side hustle maybe but no you definitely don't take it out of the tsp for sure this is the dave ramsey show In a season of giving, what better gift can you give someone in the coming year than a new job? Business leaders, if you're looking to add to your team in 2020, get started now with LinkedIn Jobs. At Ramsey Solutions, we post on LinkedIn Jobs because we know the right person will have an impact on our company for years to come. And LinkedIn Jobs matches the right person with the right job. It's no wonder a hire is made every eight seconds on LinkedIn. and over 600 million members visit LinkedIn to make connections, learn and grow as professionals, and discover new job opportunities.

So find the right person for your team and give the gift of a rewarding new career. Get started today and get $50 off your first job post. Visit LinkedIn.com slash Ramsey. That's LinkedIn.com slash Ramsey. Terms and conditions apply. In the lobby of Ramsey Solutions, Mario and Cindy are with us. Hey, guys, how are you? Hi, we're doing great. Welcome.

Where do you guys live? Brentwood, Texas. All right. Welcome to Nashville. And all the way up here to do a debt-free scream. Yes. Love it. And how much have you two paid off?

We paid off $89,502.45. Cool. And how long did this take you? 16 months. Wow. And your range of income during that time? $116,000 to $129,000. Very good.

And what do you guys do for a living? I'm a cat producer. I work with Revit doing the blueprints and Cindy. I'm a high school ESL teacher. Okay, great. Very cool. What kind of debt was the $90,000? My cell phone, dishes, credit cards, a loan from Cindy's father, both of our cars and student loans.

Half of it being students. Dishes? Yes. You financed dishes? So as soon as we got engaged, we went to all of those bridal extravaganza shows. And we went to one booth and they're like, oh, do you want two free champagne flutes? Sure. Why not?

Just come to this little, I guess, like show or whatever. And it was dishes and they kind of convinced us to buy them. I love it. That's so fun. So how long have you two been married? It's about to be three years in June. Okay. Very cool. Very cool.

Very cool. So you hardly made $90,000 during that 16 months. Did you sell some stuff? No. Not really. At the very beginning, Cindy had some money saved. Oh, okay. Okay.

So pretty much what happened was we didn't start our journey until after we got married. Right. And so I was the one, I'm the saver, and so I was the one that got all of the checks from the wedding, and I deposited them, and I put them in the savings account, and he didn't know how much it was. Ah, okay. So how much did you have in your savings account?

$15,000. Oh, okay. So that gave you a jump start on the night. Yes, it did. Okay, very cool. Very cool. So what inspired you to go this crazy on getting out of debt? And I'll let Mario take that because he's the one that started it.

I started it. Pretty much we got married and I started going nuts because, well, with that comes a lot of financial responsibilities. Everybody's telling me you need to buy a house. You need to start a family. Had coworkers talking about investing. I i never invested ever in my life and um so i just kind of freaked out started google searching how to invest how to get out of debt get out of debt your name popped up talked to another co-worker she's like yeah he's great and i was like, yeah, he's great. And I was like, I'm thinking about buying his book. And she ended up buying it for me for my birthday gift. Wow. So I read the book,

started listening to the podcasts, and then trying to get her on board was another story. Okay. So you kind of started going, I can do this. We got to do this. And so what did he do? Cindy come in and start telling you what you had to do pretty much yeah he was just kind of like hey anytime we're in the car guess what podcast and it was always your podcast and at the beginning i did not want to hear it i hear you um that's what i used to sleep um but pretty much there was one of the podcasts that I heard that really rang true, um, to my heart. It was pulling, um, some strings and it was pretty much about, um, it was a couple that got married and shortly after the spouse, um, the husband, he ended up getting cancer and it was because they were able to pull together.

They were able to get, you know, be debt free. He had money set, you know, set aside for her. And so she was set for able to pull together. They were able to be debt free. He had money set aside for her. And so she was set for life after he passed. And that's when it really clicked for me. What would happen if anything like that happened to him or if it happened to me? Yeah. And so pretty much December, like right after we got married for Christmas, that was our Christmas gift. She wasn't too happy.

Oh, okay. And we pretty much started the FPU at our local church in Friendswood at Mary Queen. And pretty much after the first class, that's whenever I looked at him and I'm like, okay, I'm in. All right. Just like that. Just like that. Wow. Wow. I'm proud of you guys. Well done. Well done. So the book and the podcast led into Financial Peace University, led into your working together and getting her done. I love it. So what do you tell people the key to getting out of debt is? You paid off $90,000.

That's impressive. Yeah. The key of getting out of debt is, one, the budget. Two, for me, is contentment, just being happy with what I have. Me, I love fishing. A lot of money that I spent before was, you know, $1,000 reels. Okay, I'm going to buy it. But I had to be content with what I had because everything, you know, everything's new always coming out every year.

Oh, yeah. So I should just be happy with what I have. Yeah. So that's what I learned in this journey. And, yeah, I don't need to go out. Cindy, what was it about the first class, Cindy, that you saw that you said, okay, let's do this. It was pretty much, I think, in the first class, whenever, I'm trying to think, it's whenever they were talking about having an emergency fund and setting aside that $1,000 in case something happened.

And I always thought, well, I always have money in case something does happen, but I never, at that time, our finances were separate and they weren't joint okay and so i didn't know how much student loans he had and after that class we kind of sat down we went through everything and i was completely shocked because i didn't have any student loans i was thankful enough that my parents were able to pay for college and so i was just like oh my gosh my gosh, you have like $60,000 in student loans. And so that's just kind of what really turned it for me. Then we got a couple car payments we got to knock off, too. Yeah.

Wow. Wow. Look at you guys. Well done. Well done. Who was your biggest cheerleaders other than each other? Pretty much family and our coworkers, our friends. Yeah.

The coworker that bought you the book. Yeah, for sure. For sure. Very cool. Very cool. We've got a copy of Chris Hogan's retire inspired book for you. It's a number one bestseller. We want that to be the next chapter in your story that you not only are debt free, but

now we move on, become millionaires and outrageously generous. You're in a position to do that. I'm so proud of y'all. Well done. Thank you. You're in a position to do that. I'm so proud of y'all. Well done. Thank you. You guys are amazing. Very cool. Mario and Cindy, Houston, Texas, $90,000 paid off in 16 months, making $116,000 to $129,000.

Count it down. Let's hear a debt-free scream. All right. Three, two, one. We're debt-free! Yeah! We're debt free! Yeah! Woo-hoo-hoo-hoo! Well done, you guys.

Boom! That's how it's done right there, man. Doesn't get any better than that. Open phones this hour. Matt is in San Diego. Hey, Matt, welcome to the Dave Ramsey Show. Hey, good to have you. Thanks.

Sure. What's up? Hey, so I just recently graduated from high school, and now I'm a full-time college student working part-time. Good for you. What are you studying? I'm studying computer science. Good. Good for you.

Yeah, so I've been fortunate to find a paid internship where I can be able to put away a good amount of money. And I'm looking into investing. So as a young adult, I was looking at what are some of the best ways for me to start investing. I wouldn't. I think the best investment Matt can make is Matt. And I want to ensure that you finish your degree and that you do it 100% debt-free, and I would just pile up a big pile of money to make sure that that happens. I wouldn't start any long-term investing right now.

You are a good investment. You get that computer science degree, it's going to be worth its weight in gold. And that's the best thing you can do is to ensure that you get that covered, that you get that done without any debt. And when you get out of school, if you've still got a big pile of money and you didn't need it and you worked and, you know, say you graduate with $50,000 or something, okay, well, you start your baby steps at that point.

You put your emergency fund in place and you start investing and you've got plenty of time to do your investing the fact that you're asking this question already just out of high school tells me you're going to be okay as long as you keep your eye on that ball graduate 100 debt free come out whatever money you've got at that point you use for your emergency fund you use for setting up your new life you use for whatever and then you start your long-term investing. You're going to be just fine. But you getting that degree is a great return on investment.

And you pay cash for it. No debt. And you have a big pile of money to make sure that happens. That's a good investment. This is the Dave Ramsey Show. Katie is in Roanoke, Virginia. Hi, Katie. Welcome to the Dave Ramsey Show. Hi, Mr. Ramsey. I'm a littleanoke, Virginia. Hi, Katie. Welcome to the Dave Ramsey Show. Hi, Mr. Ramsey.

I'm a little bit nervous, actually. I've been listening to you since I was 10 years old. Oh, my goodness. How old are you now? How old are you now? I'm 29. Wow, very cool. I'm honored.

I was an FPU baby. I love it. My question is, my husband and I are $500 shy of finishing baby step three. Yay. And, yes, I've never had a credit score. I've never been in debt. He had some issues, but we worked through that. Okay.

Our house needs a lot of work, though. It needs probably somewhere in the neighborhood of $50,000 to $60,000 worth of work. Oh, my goodness. And it was a great deal. I bet. Yeah. But he's wanting to go gung-ho into four, five, and six. I'm wanting to take an extra year and really, instead of doing like a 3B,

do just a save up for renovation. We need a new roof. We need new flooring. We need electric. We need a lot of stuff. How much can you save in a year? He makes $80,000 a year. How much can you save in a year?

Probably, I would say at least $30,000 if we really push it. But you need $50,000 or $60,000? Yeah, probably. Okay, so what are you going to do? Just cash flow the rent? You're going to just get the big projects out of the way with the 30 and then cash flow a lot of the little stuff along the way after that while doing 4, 5, 6?

That's the plan. Yeah, okay. What's your house worth today? Maybe 100. You're going to spend $60,000 on a $100,000 house? It could be a lot. I mean, we're missing sections of wall.

We are mid-Reno when we decided to get really serious about Baby Step 3. So you guys are basically camping. I mean, the house is livable if your standard of living isn't that high. Yeah, that's what it sounds like. Okay. I mean, the house is livable if your standard of living isn't that high. Yeah, that's what it sounds like. Okay. Yeah, definitely do Baby Step 3B and use that for renovation for one year for sure. And what you need to do is lay out your renovation projects and price them and then break them apart as separate projects and then prioritize them.

Okay, because you're not going to do it all at once. Break them apart as separate projects and then prioritize them. Okay? Because you're not going to do it all at once. But you can start one almost immediately, right? I mean, let's say you were going to do $30,000 a year. That's $2,500 a month. So in two months, you could do a $5,000 project. Okay. Like February.

A big one is we need a roof. And how much is that? It's going to be about probably somewhere like $10 to $15. How many? You haven't gotten bids then. Not in a while. Yeah, you need to get bids. If that's number one, then you just start saving towards it.

But what's number one? You might want to knock out a couple of little things, like put up a wall, that kind of stuff. Is the roof leaking? No, but it's very saggy and scary looking. Yeah, I want it to be fixed this calendar year then, in the 30, right? Yeah. So you're going to get it within 12 months, but you might want to knock out a couple of the little projects first just for quality of life

if the roof is not leaking inside the house. In other words, if you've got some walls that are unfinished inside the house, that would be an example. I don't care. Listen, here's what you do. Start getting your projects, make a list of them, and get bids on each individual project, not the projects as a group, each individual project, and then prioritize them.

I don't care. You decide when you want to do which. Okay. Which one do I want? Knowing that I can get through one through seven or whatever it is, I don't care, in 12 months, those are the ones that I don't have to be so hardcore about, but the other ones are going to be a while before I get to them because I'm going to cash flow those while starting my baby step four.

Is that all making sense? Yeah, it does. So $2,500 a month gets you a long way through this list. And if you're careful, it might get you almost all the way through it. And by the time I'm talking to you next year, you've got a whole different house. Merry Christmas, right? Yeah.

Good job. Well done. Good job. Christopher is in Seattle. Hi, Christopher. Welcome to the Dave Ramsey Show. Hey, Dave. Hey, what's up?

Great to talk to you. You too. Hey, so my fiance and I went to FDU earlier this year, and we're about a quarter of the way into baby step two. But we're planning on getting married in August of next year, and I'm just trying to figure out where on the budget am I supposed to fit in the wedding funds? Am I supposed to put it along with the hang off the debt, or do I prioritize that and then work on the debt afterwards? Yeah, what are you planning on spending on the wedding? Not a lot. Her family has given us about $4,000, and my family is pitching in a little bit,

so probably around $25,000 to $3,000. Okay, well, that's not much. All right, so you just take, you know, and you're getting married in August, so that's eight months, right? Yeah. So let's take $3,000 and add $500 a month for the first six months of the year to your budget. 500 times six. Don't stop trying to pay off fees. Yeah, it just slows down your debt snowball by $500 a month. Right. You say $500 a month, January through June, and you have $3,000.

Gotcha. So don't try and, like, attack it, like, really hard. Just do it while I'm doing Baby Step 2. The wedding? No, you have eight months. Right. I mean, if you can do $500 a month towards it, you'll be fine. Now, here's the other thing, okay?

Weddings are like anything else. Well, they're not like anything else, but as far as financially, they're like anything else. This is a project. And so you have a timeline, and you have a budget, and you have the categories within the budget so if you say we're going to spend three thousand seven thousand dollars on the wedding four thousand from her family three thousand from you guys then you need to know what you're going to pay for the dress what you're going to pay for the photographer what you're going to pay for the reception and you need to break that out and it needs to total no more than seven thousand dollars because if

you don't think emotion gets involved in this budget, this is the most emotional budget you'll ever do in your life. Yeah, it's already been pretty emotional. Yeah. So you guys lay that out, and then actually there's some good percentages out there. One of the forms is in the back of the Smart Money, Smart Kids book on weddings, and there's good percentages out there, and you can do whatever you want to do, but the typical wedding has X percent spent on the dress, X percent spent on the location,

X percent spent on the reception afterwards, which, by the way, with the typical wedding is by far the most expensive piece is the reception. Typically it's more than half. Yeah, she's mentioned that a couple of times. Yeah, more than half. So, I mean, you could do a potluck and save a lot. A bottled water and a potluck. It's up to you what you want to do.

But the point is, begin with the end in mind. So you lay out, okay, the end in mind is August, we have this amount of money we need, and we're going to break it down. But you can't just, the language you used when I asked you what you were going to spend was kind of wishy-washy it wasn't real solid language

see i'm the i'm the nerd i'm the one who who does all the uh finances but she's the one who knows all the stuff about the wedding so no that's not gonna work me a number that's not gonna work and it was about three thousand yeah yeah no we we need a number that we both agree to and is a total and is a part of a whole. I mean, is a whole, and then the dress is a part of a whole, the photography is part of a whole, the reception is part of a whole, the honeymoon is part of a whole, and so on. Because that way you plan in and you have your wonderful day and there's not financial stress. And if she's looking at a dress that's twice as much as you budgeted for, then she automatically knows that dress is not going to happen unless she cancels the photographer.

Right? Well, thankfully, we've already paid off her dress, so that was actually a good thing. You're missing the point. The point is you need guidelines, okay? Got it. The point is if you take zero for the dress because it's already paid off, that's okay. But have it all written out as to where the – it's like building a house, okay? It's like running one of our big live events that we run.

We know what the labor costs to put the lights up. We know what the renting of the venue costs. We know what the drivers are going to cost to get the speakers to the event. We know what our hotel cost is going to be. You line out the costs when you're running a project, and you put it to the timeline, and you get stuff done on the timeline, and there's just no stress then. People that stay stressed out, it's because they don't have any guidelines. They don't have any guardrails in their life, which gives you the ability to say no to the most important person you can ever say no to, which is yourself.

Learn to say no to yourself, because you gave yourself a guideline that gets us to our overall goals. Please do that with a budget. It will keep our mother out of it. This is The Dave Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. This episode is over, but if you heard about a product or service and didn't have a chance to write it down, don't worry. We list everything that is mentioned during this episode in the podcast show notes section. Thanks for listening.