The Ramsey Show - App - Living a No-Debt Lifestyle Will Give You Peace (Hour 1)

Episode Date: January 24, 2024

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🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. I'm your host, Jade Warshaw, joined by George Campbell, author of Breaking Free from Broke. It's good to be with you today, George. It's been a while, Jade.

It's going to be a fun show. We're taking your calls. Give us a call. The number is 888-255-225. And we are here to give you the hookup. We'll chop it up with you. Let's go straight to the phone lines where we've got Terrell in Berkeley, California. What's going on, Terrell?

Hey, how you doing? Doing good. Did I get your name right? Yes, Terrell is the name. Let's go. How can we help? I'm just calling for a little bit of advice on buying a car. Right now, I've been saving some money to buy a car.

And I just want to make the best decision of either buying a used car or one that is pre-owned. And I'm actually in the motion of trying to own a house. And I've been buying used cars for approximately a couple of years now to save money. And so I won't have a big overhead on cars or paying a car note. So I'm just trying to see exactly what's the right decision to make. So you've been in the process, you've currently bought used cars. Have you been purchasing them in cash? Yes, cash. Good. That's very, very good. So are you considering, it sounds like you're considering two things, either continuing to do that or possibly buying a brand new car or taking on a car note? Yes, yes. So what's driving you to upgrading car?

No pun intended. Actually, my car just broke down after four years, and I'm just tired of the fact of, you know, having to spend money on mechanical issues with buying a used car, and I just want to buy something that's more prolonged, buying a vehicle that I know that I can trust for a couple of years so that I don't have to worry about any car issues. Yeah. In the past, how much have you spent on a used vehicle? Like what's your vehicle worth now or when you bought it? My vehicle that

I bought was $2,200 and it lasted me four years after just a couple of mechanical problems. That's some pretty good R&R. Listen, that's not bad at all. How much money do you have right now in cash? In cash? Actually, I saved up around $80,000. Wow. Yes. Do you have any debt?

No, no debt. Wow. I always watch you guys show about learning not to get in debt. I have no debt at all. What do you earn a year? I earn approximately, this year I made $94,000. Doing what? What's your job?

I actually do sewer maintenance. Okay. Listen, Terrell, I'm proud of you. You've been buying cash cars. You've been staying out of debt. You've managed to save $80,000. Here's the thing. When we tell people to buy cars in cash, it is a way of life, right?

You draw that line in the sand. You say, I'm not borrowing money anymore. However, the idea of driving a hoopty for life is not really it, is it, George? Like, we want you to slowly but surely upgrade your car with cash. I don't want you driving a $2,200 car when you're making $94,000 a year and you have no debt. Like it's time to move on up. All right. That doesn't mean go to the nearest dealership and find the shiniest, newest car on the lot. That's right. So what's your net worth right now? My net worth in all in all total, I will say that it's around the $80,000 mark or plus.

Okay. I'd rather us focus on that as the scoreboard instead of your credit score. Because you're about to, I'm sure you said you had a great credit score, right? Yes. And you know what? The dealership, the salesperson is like, I'm about to get Terrell with this car payment. I know, right? Can't wait.

I'm going to tell him how great of a job he did with his debt management score. So I'm going to ignore the credit score and we're going to look at your income and also tell you that the time to buy a new car, brand new,

is when you're a net worth millionaire. Exactly. Because you buy a $40,000 car, bro, that's half of your net worth right now. Like, that hurts my brain.

So there's a time and a place to do it. I've seen a car for approximately, excuse me, I've seen a car approximately for about $15,000. And I was going to put half of the payment down and try to slowly either make payments on that. But you have $15,000. You have $15,000 cash money that you can go into that dealership. You can buy a $15,000 or $20,000 car, walk out, out own it free and clear and not owe anybody anything

because here's i don't think you realize how well you're set up to rel um george just outlined it you're in a situation that you don't need anything from anybody and credit scores are for people who think they need something from somebody like credit cards are designed for people who think i can't do this myself i've got to borrow the money you've already completely just bashed through that you cut out the middleman you already cut that out exactly and so at this point the only thing that you have to do is continue to live the life you're living and when you start thinking about the the time to buy real estate start putting aside the same money the same way you started saving that 80 000 is the same thing you're going to do when it's time to buy a house. And that's really,

Terrell, you've already knocked out one of the two kingpins of the no credit lifestyle, the car, because so many people think you can't buy a car in cash and continue to buy cars in cash. You've already crushed that, like you got it. And the next thing is the house. And so for you, that's after you get through this car thing, the house is your next big goal. And you'll save that down payment and you'll be able to buy that with a zero credit score as well. So in your situation, it's better to have a zero credit score, no credit score, right? Which means you're not messing around with debt at all, then to try to play this game. And maybe if I take out a little bit on my car and pay that for a while, or maybe if I pick up this little credit card here, it's a game that you have already decided I'm not playing. Like you've already changed the game in your life. So don't go back and try to play a loser's game. Cause you're already a winner. Fair enough.

Okay. Yes. That's fair. What kind of car are you looking at? Um, I was looking at a Honda Accord. Yes. Okay.

This guy, this guy, like low maintenance, Honda Accord or Toyota Camry. Listen, listen come on with come on with the camera there we go these are these are the reliable cars we're talking about that thing will outlive me and so i'm gonna go with one of those you can find them for 15 or 20 grand you're going to walk in there you don't have to walk in with a briefcase of cash you just say hey i'm looking for the out-the-door price. That's what you ask for.

And then you're going to get a pre-purchase inspection to make sure there's no mechanical issues. And what happened right there is someone else paid the depreciation on that vehicle for you when you buy a used car. Someone else took the hit because they paid $38,000 MSRP and Terrell got it for $15,000. Come on. That's a deal because new cars depreciate much

faster than used cars they go down in value trail get this 60 in the first five years okay and so by buying used you're being a really smart consumer and one day you'll be driving a brand new car when you got a million dollar net worth and if you want an accord you just walk on the lot and you choose that accord if you want something fancier you just walk on the lot and you choose that accord. If you want something fancier, you've earned the right to do it. And so this is going to help you build wealth by making these decisions now. Terrell, how old are you? Yes, sir. I'm 33.

Come on. 33 years old. Killing it. Killing it. Very, very good. It's so hard living in the Bay Area due to the fact that the cost of living is so high. We have a lot of high interest rates of buying vehicles and buying homes. So that's why I've just been really just trying to save as much money as possible because my first goal was to buy a

home. Yeah. And, you know, that's why I've been buying used vehicles to try to keep saving up. Listen, you're doing everything right. You're doing everything right. Keep doing that. Stay out of debt. Practice a life staying out of debt. You know, you're doing everything right. You're doing everything right. Keep doing that. Stay out of debt. Practice life staying out of debt. You know, you're doing the right thing. You've saved up the money to buy a much nicer car in cash. And that's what ultimately we want for you. You're not driving a hoopty for life.

You're upgrading. And with your income, you can definitely easily afford to pay $15,000, $20,000 for a used car. And he's not trying to impress anyone. He's impressing future Terrell. I like that. This is The Ramsey Show. You are listening to The Ramsey Show. I'm your host, Jade Warshaw.

Next to me is George Camel, host of the YouTube show, The George Camel Show. Also, author of the book Breaking Free from Broke, which is out now in the wild, George. It's been so fun to see it arrive at people's homes, and the reviews have been just wonderful. People are changing their lives, Jade. Yes, they are. From 17 to 51, cutting up credit cards,

ditching the credit score. I love it. Very encouraging. You love to see it. Love it. So if you haven't gotten a copy, be sure to get your copy. I've got mine.

Let's take a call. Let's go to Molly, who's in Boston got mine. Let's take a call. Let's go to Molly, who's in Boston, Massachusetts. What's going on, Molly? Hi, thanks for having me. So my husband passed away four years ago. Sorry about that. And thank you. So I have benefits from his death. So I live very comfortably on the income that I have. However, I'm getting a couple of one-time payments that I don't quite know what to do with. It's a substantial amount of money. And I don't know, like, I lost a lot of money in the crash in 2008 through my 401k and stuff. So I'm a little leery to do that.

Well, you only lost it if you pulled it out. Did you pull it out? I did. Okay. Okay. We'll consider that as we move forward, but keep talking. Okay. So like I said, I live comfortably on what I have. When I take vacations, I prepay my credit card with my guesstimated, you know, what it's going to cost so that I don't actually incur debt, but I feel it's safer than using my debit card and you can't rent a car with, you know, a debit card. Okay. We'll talk about that too. Okay. Okay. So I have these two lump sums coming in and I don't really know what to do with them. And my bank offers a 5.5 percent interest on CDs. So I've considered like every two weeks putting in a substantial amount

of money so that if I need it. How much are these single payments going to be? And how many of them do you think you'll get? The total for the two are $555,000. Okay, $555,000. Wow. And you're getting it two times. Okay.

No, it's the total. That'll be one time. That's the total of the two. Oh, got it. Okay. So they'll give you $225,000 for one and $225,000 for the total one. That'll be one time. That's the total of the two. Oh, got it. Okay. So they'll give you $225 for one and $225 for the other or whatever. Or whatever it is, $275. Okay. So let me ask you a few questions now just to put it all together. So do you have any other debt? Like, do you have any debt on the books? Do you have a mortgage?

Can you tell me a little bit more about your financial situation as far as income and debt? Okay, so I did purchase a house last May, and I purchased it for $429,000. I put $115,000 down on it. Okay. So my mortgage payment now is $2,500 a month. Okay. No other debt. No other debt.

Cars paid for? I'm driving a 16-year-old truck. Okay. Now, other than this $555 that's coming, do you have any other money saved? I do not, just because I just bought the house and had to furnish it and everything. But my monthly income is $7,200. Okay, so you bring about $7,200 home every month. And what about children? Out of the house. Okay. Okay, so George, jump in at any time. So I'm looking at this situation and I'm filtering it through our teaching here at Ramsey. I don't know how

familiar you are with it, but we view everything through seven baby steps. And these baby steps are what we feel are the fastest path to wealth with the most amount of peace, least amount of stress. All right. So that's everything I'm talking to you is going to be through that. So with you, it's great because I just recalculated because I actually bring in 7,400 a month. Oh, excellent. Love it. Love the increase. Okay. So with you, because you don't have any debt, that's excellent. It's kind of jumping us to the third baby step, which is making sure you have three to six months saved. So if it were me and I woke up in your shoes, that would be my first thing that I'm

going to gun for. I'd think, okay, what do I need? What would constitute six months of expenses for me? And I would work at getting those saved. When are you getting that first payment? Within a couple months. Okay. So between now and then, I'm going to use my income and I'm going to start to build up that three to six months of savings. So that's thing one that I'm focused on is how can I get six months of savings? Thing number two that I'm going to focus on in your case, just because I think everybody needs a budget, is I'm going to start a budget. The budget we recommend here is every dollar. And you're going to want that going forward now that you've got this house you've just got this new life in front of you with new expenses and new money and a new relational

situation it's just a whole new life for you and having a budget is going to give you a lot of peace month to month of how you're spending your money okay so that's thing one and thing two now i'm looking at this money and george is going to talk to you more about the investing side of things because I think that's worth noting. But as we've talked about saving and budgeting, I want to go back to what you said earlier about your credit card and it being safe versus a debit card. If I were you, I would think really seriously about cutting up my credit cards and deciding that I'm going to live a debt-free lifestyle. Because for you, it's easier than ever. And you don't need the credit card. You don't need it.

You've got money in the bank. And so as far as, you're worried more about safety, it sounds like. Yeah, I've had my debit card compromised several times, and I found that it's easier if that happens when you're traveling to have your credit card because it's not your real money. It's their money. And I found that it gets resolved a lot quicker. And, you know, so that just makes me nervous because if I'm traveling and I'm using my debit card and it gets compromised, then I'm stuck.

I've never – I can vouch for this. I've visited – I've traveled to over 92 countries. I've never had a problem with them restoring the money to a debit card account. George, you just talked about this. The protections are exactly the same as long as you call and say. If your debit card has a Visa or MasterCard logo, you're covered under their zero liability policy. And there's even a federal law. The Electronic Fund Transfer Act protects

debit cards in cases of fraud, as long as you report it within 60 days. And so on top of that, renting a car, every single major rental car company has their own debit card policy. And so there may be a slightly bigger hold on your checking account, which you have the buffer for, but you'll have no problem doing that. Yeah, those companies definitely make it a little harder but you can still do it. It will reduce your risk as well as give you more peace when you just use your own money now. And I talk about this in my new book, Molly.

So I'm gonna send you a copy because I cover how to rent a car without a credit score, why you should ditch the credit card and even the CDs and why I'm not a big fan of the certificates of deposit you mentioned. What's gonna happen there is it's going to lock that money up. And if you withdraw it before it matures, the maturity date,

you're going to have to pay a penalty of losing some of the interest. And so you can actually, that rate you mentioned is what I'm getting right now in my high yield savings account, which is completely liquid. There's no penalties if I take the money out. So I would encourage you just as you pause and decide what's next to put the money in a high yield savings account. That's what I would do. And that's what I do as well.

So I think that that kind of gives you some just lifestyle changes to consider, cutting up the credit cards, living a cash lifestyle. That's good to consider. And then finally, if I'm you, as this money is rolling in, the way we teach the baby steps, let me just roll through them real quick so you get the context. Number one is for people who are first starting out, they just get $1,000 saved. Number two is for people who have consumer debt. They pay off all of their debt except the house. Number three is where you're technically at, which is saving three to six months of expenses. Then from there on, people do four,

five, and six simultaneously. So because I know you're going to have six months saved up quickly, let's talk about those real quick. Baby step four is you're investing 15% of your income every single month. So I want to make sure that we start that habit for you. And then if you have kids that are going to college, baby step five, you can do this at the same time. You can start setting some money aside for college if it makes sense. And then finally, baby step six, you can start putting extra money towards your house. So putting that in context for you, if I'm you, I'm going to start putting that 15% aside, like on auto pay coming out of my check every month. And I'm going to start looking at

when this $555,000 comes, how I can start paying my home off. And that's an emotional decision, but it is a wonderful one to make. And you'll still have over 200 grand left over to max out retirement, to give more, to enjoy life and spend more, and to upgrade that 16-year-old truck, Molly. It's time. It is time. So hang on the line. We're going to send you a copy of Breaking Free from Broke. It'll walk you through all of the stuff we talked about and hopefully help you have a new paradigm around it. I love it. Man, what a blessing to have life insurance. Not fun, but man, it changes things.

Absolutely. This is The Ramsey Show. You are listening to The Ramsey Show. I'm Jade Warshaw, joined by George Camel. And I just want to thank you guys so much for tuning into the show week after week. Thank you for hanging out with us on YouTube or whatever podcast service you use. Thank you for sharing the show

with the folks around you. And we want you to continue doing that. Wherever you consume the show, we would love if you took a moment to like the show or subscribe to the show. It means a lot to us when you do that. Even when you just send a link through a text to a friend of one of your favorite episodes, that means a lot, not only for us, but also to the person that you're sharing it with. There's so much great information on the

show. So when you share it, it not only helps that person, but it helps us more and more people see the show and the algorithm. And it is just a wonderful chain of events that takes place. So if you've been doing it, keep doing it. If you've never done it before, just take a second. It's free. It takes two seconds of your time. And the result of it is massive. It's a great return on investment, George, as the financial folks would say. That's right.

So thank you so much for doing that. It means a lot to us. And let's head over to the phone lines where we got molly in new orleans louisiana what's going on molly hi everyone how are y'all we're doing good how are you i've been better we're in a bit of a sticky situation and i'm calling to kind of get y'all's advice on how we should address a pretty big financial situation our dishwasher dishwasher busted. And we are down to the slab and the stud. Yikes. And yeah, it's not ideal.

I'm six months pregnant and I have two small children. Oh no. Oh no. Not exactly a convenient time. A big problem we've run into is insurance is denying our claim. So it's looking like we're going to have to pay for this entire renovation out of pocket. Oh, so this isn't just a dishwasher. You have to replace flooring?

Oh, yeah. I mean, it floors, it ruins cabinets. Oh, gosh. A little bit, yeah. We're going to have to replace some drywall, some insulation. What's the price tag? So I'm waiting for my full estimate because I went and I picked materials today to go pick out flooring and things like that. But on cabinets and then the demolition alone is 17,000. And that's not having,

you know, that's not anything to do with floors, my countertop, et cetera. Um, where we are fortunate is that, um, we do have money saved from,

uh, saved and invested that my husband inherited after his mother had passed away. Um, but we're looking, I guess, for the best way to use that money in order to pay for it, because we really don't want to have to take out a personal loan or go into any sort of debt to find. Well, that's off the table. So let's look at this as though debt doesn't even exist in the world. And I like to look at situations that way because it then takes

it off the table and it frees my mind to be very creative in my approach. So from this moment on, there's no such thing as debt. We don't even, it doesn't even exist in the world. So let's talk about it like that. You mentioned that there's some money that you have, but you also mentioned that it was invested. Can you tell me more about that? I can tell you, I guess generally, my husband tends to be the one to run the investment side of things. But from him, we do have, he said there's $59,000 in a high-yield savings account. Good.

It's $53,000 invested in stocks and bonds. Specific ones I can't speak to personally at this time. I just don't know. it's 53,000 invested in stocks and bonds to specific ones. I can't speak to personally at this time. I just don't look. Look, the 59,000 is where I'm at right now. that high yield savings account just covered this renovation. I know it did.

There's another 11,000. He said in a, uh, he said it's called a money market account. It's still like a cash. Yeah. Okay. So listen, the good news is you guys have the cash to cashflow this. uh he said it's called a money market account it's still like a cash yeah okay so listen the

good news is you guys have the cash to cash flow this and that's really comforting and good good for you guys for making sure that that safety net is in place do you i'm just curious do you have any other debt that we should know about that plays a role in this um not really i mean we have um a mortgage um fine and then we only have we were completely debt-free until about the last year we have about 5 000 in credit cards and that was three out of four family members wound up in the hospital at some point so very sudden random unforeseen circumstances that happened. Aside from that, both cars are paid off. Good.

Okay. No other debt. So 5,000 clears all of your consumer debt. Yes. Let's do that today. Love it. We're clearing that debt out today. I love that you still have extra money left to get this kitchen fixed and to repair these damages.

I don't think you're going off the wall. I don't know that you have to spend, you know, every dime that you still have extra money left to get this kitchen fixed and to repair these damages. I don't think you're going off the wall. I don't know that you have to spend, you know, every dime that you have. But what I do want you to get from this and what I might take away from this situation, Molly, is you guys have done a good job. You've kind of played patty cake with your finances in a way that it's like, oh, we can take out some debt for this. Maybe we can consider it for this. Because I have a feeling that if you hadn't called in, you guys might have taken out a personal loan to cover something that you can pay cash for and cash flow throughout your life and your situation. And so my takeaway from this would be coming off of this call, I would have you and your husband really get on a good budget

because that's what's going to inform your lifestyle from here on out. And I think when you have a good budget, it's giving you like this snapshot of what your entire financial situation looks like. So when something comes up like family members getting ill, you're not going, oh, I'm not sure if we have the money for it. So let's just use the credit card or something, you know, like a catastrophe pops up like with this dishwasher. You're not thinking, oh, our only option might be to get out a personal loan. You've got all your finances in one place. And of course, the budget we recommend is every dollar because you can see everything about your finances in that one app. And it just kind of gives you

that peace of mind to go in your case. You would look at that and go, oh, my gosh, we're doing far better than what I realized. And we can pay cash. We don't have to go into debt or stress or monthly payments in order to deal with something honestly as big as a dishwasher flood in the house. I love that you guys have $59,000, really $62,000 saved. It's amazing. That saved the bacon today. And Molly, a few things to consider. Number one, you may want to consider appealing the claim denial with insurance if you feel like you have good reason to believe it should be covered. Is that the case? And that's been my battle the last two weeks. I think the next step is seeking out some legal advice, which is, you know, an avenue that we're willing to explore it's I feel it was definitely a

premature denial of our claim and then I fought back and fought back and fought back they kind of sent someone out I think to appease me maybe you know and let someone come take a look. So I had someone in my house, but then, you know, they're still maintaining a denial, which maybe I'm in denial. Maybe I'm just not willing to accept that. Well, if the appliance was old, it wasn't maintained properly, there was negligence, you know, there's a lot of things that would cause the denial, but I'm just, if it takes a month of fighting to make that 25 grand needed for renovations, I'm fighting it. So that's one angle. The second is to make sure you get multiple bids on this. Don't just take the first bid from the first guy who says they can fix it. So I'd get multiple bids. I would try to negotiate and say, hey, we can pay up front

with cash if you're able to give us a discount and see what they say. Yeah. And a lot of times you'll get 4% off, which adds up when it's $25,000 of work. Listen, wait, I might go against that, George. What's that, with cash? Are you talking about with the contractors? Well, with whatever the bid is. That's true, but I would never pay a contractor up front. Well, when the work is done,

but I'm saying like some people will go on payments or something like that. Oh, you're saying no payment plan plan i got you yes hey we'll write you a check when this is done okay yeah because i was about to say when the guy comes in when they swipe a card there's fees involved that they have to pay and so if that's a three percent fee and you say can i get a three percent discount if i just write you a check just simple things like that can save you money so i'd get multiple bids and do your best to just lower this cost. Because I know it's a stressful time.

You're six months pregnant. You got two kids running around like crazy. And I'd also get more details on this investing side. What's your husband's doing? You should have some clarity and understanding of everything going on with your financial picture. I definitely agree with that. Listen, not fun.

That water is one of the most insidious things that can happen in your home. It is just the worst, especially in her situation. Six months pregnant, two kids on the way. I felt her pain. I just want to say not today, Satan. Not today. I know. That's right, George.

Oh, but thankfully they had the safety net of an emergency fund, a fully, fully, fully funded emergency fund. That's what you need when life storms hit. This is The Ramsey Show. This is The Ramsey Show. I am Jade Warshaw, your host, joined by George Camel, your other host. George wrote the book Breaking Free from Broke. I wrote the book Money's Not a Math Problem. And so, listen, just two authors sitting in chairs talking about... Doing the dang thing.

Just doing the dang thing, George. That's what I'm talking about. So how has it been? Tell me a little bit about the journey here of this book here. Well, writing a book is one of the hardest things I think I've ever had to do, especially when it lives in the world of total money makeover. And what's been really encouraging though, is people going like, this is, Dave Ramsey said, this is financial peace for the next generation. Reviews are saying, this is like total money makeover, but written for 2024 with me in mind, all of the objections, all of the struggles I've been

dealing with the last few years with inflation and the housing market. And what do we do now? And credit scores and credit cards. There's so many more traps than there was even 10 years ago. And so I covered all in this book to help you have this paradigm shift and go, I don't need to play this game. Building wealth and living a life I want to live is so much simpler than I thought. I just got to ditch this money matrix that's been created for me.

So the reviews have been awesome. And your book hit the bestseller list, Jade. Congratulations. I did not even know that that was possible, George, because you have- Love will find a way. You have a, what I'm going to call full-sized book, and I have the miniature version- A quick read. Which is a quick read. And I didn't know it was possible, but here we stand in the national bestseller category. Yes. I love it. Very cool. That means people are getting helped. That's right and that's what we're

here to do. Help you guys. Help you with your money situations, your relationship situations, mental health situations, career situations. All of that is directly connected in your life. So that's what we talk about on the show Your Life and Your Money. So you can give us a call. The number is 888-825-5225 and we will do exactly that and let's do it now going to taylor in washington dc what's going on taylor yes so first congratulations to you both on your new book releases gracias and claps to that um i am calling because i'm in a little bit of a situation to where currently I own my home. I also have an investment property. The investment property is doing well in terms of just the equity aspect.

So at the moment it has about $150,000 worth of equity that's in it. However, I'm really not making anything off of it too much. I find that I'm actually giving, putting out money. So like for example, 2023, I probably spent $2,000, 2,500, something like that, just kind of doing repairs that maybe the rent wasn't able to cover. And so I'm in this little mix of, you know, understanding that real estate is the best part to wealth. I have a home with my, with my husband that we, um, that we own still have a mortgage on, of course. Um, and so the idea was to acquire

more properties in a sense. Um, but now I'm starting to have this idea of do I also the property at 140, 150,000, uh, where I will be able to get that equity and possibly just pay off my student loans where I currently have about $80,000 because I ended up getting my MBA. And obviously as a result, like a lot of other people, racked up a lot of debt with that. What other debt do you have? My revolving debt, I only have about $15,000. I'm not going to say only, but I have about $15,000 in revolving debt, which includes my car note, credit cards, things like that. What about your husband? I'm just not sure of which way to go.

What about your husband? What debt does he have? My husband probably has about $10,000 worth of debt, and that also includes vehicles and credit cards. Okay, so he has $10,000 in cars and credit cards. He doesn't have student loan debt? He does. I'm sorry. Yes, he does. He's less than mine. So I think he's 40. He's about 40,000 now. Okay, so 40K in student loan from him. Okay, so there's a lie here, Taylor. I'm not going to lie to you. This is a tangled web. You got 150 grand in just consumer debt. Yeah. So what is the investment property worth? Right now it is the worst. I could

probably get like 360 at the minimum. The high would be 380 and I owe 199,000. Okay. And you're thinking after fees, you'd walk away with about 130? Yes. Yeah. Yeah. I take about, yeah. After all of the credits and things like that, at least. You guys have any money in the bank right now in savings? Yes, we do. We have about four months worth of our living expenses. How much is that? We are, it's about $40,000 in our, yeah.

Do you guys have stocks, like single stocks or single investments? I do, but it's not much in there. I only have about $6,000 in my single stocks, and obviously not including 401Ks or anything like that. And do you have a brokerage or anything else that we should know about? No, that's probably it for the most part. And what's the household income? Combined, we are about $240. Good job. Okay, good. And okay, so I know, George, I'm looking at these numbers and I'm just seeing a situation that's so complex that doesn't have to be complex.

It looks like when you just said all of that, it was just even a lot to say. Like to list all that out was a lot to say. We had to take a deep breath at the end. We had to like wipe the sweat off of our brow. I think that there's a way to really simplify this. And in my mind, it does start with selling that rental because it's going to give you the cash you need to get a hold of your life and to simplify your life. And then and only then you'll be able to do the the cash you need to get a hold of your life and to simplify your life. And then and only then you'll be able to do the thing that you want to do, which is purchase real estate. And you'll be able to do it the right way.

So I kind of feel like have you ever seen on the movies where the guy like clears the table off and he like just uses his hands to like knock everything off like I did with the microphone. And then you got like the clear slate. I feel like that's what we have to do with this is just knock everything off like I did with the microphone. And then you've got the clear slate. I feel like that's what we have to do with this is just knock everything off the table and start over. And I think that selling this real estate is the way to do that. You're going to clear, like you said, about 130. And then we've also got 40,000 saved on our debt. And I think, or saved in a savings account.

If you take that money, you can be debt-free immediately. With most of your emergency fund on top of that. Yeah. Because you're going to have like 176. If you include the stocks, if you sell those too, that 176 is going to clear your debt and leave you with a fully funded emergency fund.

How good would that feel? It would feel great. Now, it's a little intimidating. So we are in our early 40s so it's like it also is like feeling like starting over with rebuilding what are you rebuilding you're clearing the deck here in the best way possible you got no payments and you make 240 i think you're gonna be okay you're not rebuilding right now. You're 400 pounds and you're out of shape. And what we're doing right here, when you do this, you're going to be 160 and lean. Like that's what we're doing

for you. Cause right now you're overweight. It's stressful. It's heavy. It's a lot to carry. And by you doing this, it's, it's literally getting you financially fit is what we're doing. And when you're able to be fit, then it's like, okay, I can move better. I can think clearer. And you're going to be able to do what you want to do ultimately, which it sounds like you guys are interested in real estate, but now you're cleared up to be able to do it the right way, which is ultimately paying cash for it after you've paid off your home. So there's a right and a wrong way to do certain things, and there's a better and a best way to do things. And we're trying to tell you the right, better, best way to get where you want to go.

Right. Fair enough? Fair enough. Thank you, guys. I don't think you're going to regret this decision. I don't think so either, but I do think, and it's worth noting while you're on the line, I do think there's a certain meeting of the minds that you and your husband are going to have to come to and um I do you know when you get off this call tonight you guys get home and you're having dinner and you talk about this what what

does that conversation look like to you uh we'll probably both be on different chapters that's what I thought is he gonna want to hang on to the debt yeah and and that's what and That's what I thought. Is he going to want to hang on to the debt? Yeah, and that's what made it hard a little bit to move forward with decision making of trying to find that alignment. I feel like slowly we're getting there, you know, but it's like each of us

presenting our case. And so it's like you said, trying to have that meeting of the minds and find that mutual decision. Well, here's what I would suggest. I wouldn't suggest you going straight away tonight and being like, I was on the radio and these two blockheads told me to do da-da-da-da-da.

I would suggest you taking a moment to get your head around what we've just said because we told you a lot and there is an emotional component to that and there's an emotional, like, it's just a lot. So I would recommend you taking a moment to get your head around it, figuring out how you feel about it. That way you're presenting your case, not George and I's case. Because if it's not real to you and if you don't have a genuine connection to it, it's not going to go over well.

And I think that's important to know, George. Yeah. You guys make $240,000. There is no reason to play with debt anymore. You're too successful. You're too smart. You know too much to stay broke. It's time. It's time. The time is now. This is The Ramsey Show. Thank you.