The Ramsey Show - App - Make Your Money Behave (Hour 2)

Episode Date: August 28, 2019

Home Buying, Retirement, Budgeting, Debt   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 

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 starting this hour is kyle in wisconsin hey kyle welcome to the dave ramsey show hey man how we doing today better than i deserve sir how can i help hey i'm in uh baby step two right now and i'll have that uh done taken care

of in about another month or two and then i plan on having baby step three done by taken care of in about another month or two. And then I plan on having baby step three done by the end of January of 2020. Great. So starting next year, I'd like to start planning and saving for a down payment on a house. Good. I was curious as to what is the best way to build that? I've heard some people investing in like an index fund or just straight up saving it. What do you recommend? Well, the problem is that if you don't leave money in a mutual fund alone at least five years, you stand an increasing chance every year that you don't of losing money on it. So 90-some-odd percent of the five-year periods have made money.

Only about 65% of the three-year periods have made money. When you only leave it alone two years, and you're not going to be saving for five years for a down payment. Right. So you're standing a good chance of messing around with the stock market or losing money. The stock market in mutual funds is a wonderful long-term investment it is not a good short-term investment okay so if i were you i would not use an index fund because how long you're going to be saving for your down payment i was thinking about two three years or so yeah

two years probably is going to be right and um you're going to i would just put that in a savings account you're not going to make anything on it but you're not going to make anything on an index fund in a year okay it's not that there's not that much money involved here and so it's not worth the risk of messing up your head at your down payment on your house screwing around with the stock market uh fernando is with us in texas hi Fernando. How are you? Hello, Dave. What an honor. Thank you for taking my call. Sure.

My pleasure. How can I help? Yes, sir. So I just got done with Baby Step 3, thank God. And so now I'm going to start putting money in my 401K. And there's a few everyday millionaires in my job, and they all tell me to invest in the traditional because of a tax break. But I listen to you hardcore, and I know I should listen to Roth. So my question is, can you please reassure me that Roth is the right

decision for me? So how much, how old are you? I'm 33, sir. Okay, and how much will you be putting into your 401k? So it's 5% to get the match, and so at least 5 five but to max it out it would be like 24 percent so that's around 750 a month if i max it out okay well you wouldn't max it out unless you have your house paid for yes sir i have not okay we tell you to put 15 of your income maximum into retirement so let's just use an example let's say you put dollars a month in okay yes sir we'll use that as our example we're going to start with nothing in there you're 33 and we'll do this until age 63 which would be 30 years right okay follow me okay yes so if you put five hundred dollars a month away for 30 years in a decent growth stock mutual fund i have to put this in here again

because i didn't do it right somehow. All right, let's try that. There we go. You'd have about $1,700,000. Okay? Okay. All right. And keep in mind that during that time you put in $6,000 30 times.

You've put in $180,000, but there's $1.7 million in there. So we'll say you put in $200,000, and there's $1.5 million in growth, right? Yeah. Okay. In a traditional, you have paid taxes on none of the money. So you'll pay taxes on the entire $1.7 million. Taxes on that would probably be $400,000. Okay?

Okay. And at Roth, you will have already paid your taxes on the $200,000 that you put in because it's an after-tax investment. And the growth, the other $1.5 million, is 100% tax-free. So when you get to retirement, you're either going to pay taxes on $1.7 million, or you're going to have $1.7 million tax-free. The difference in this discussion is probably somewhere around $400,000. Oh, wow. Kind of makes sense, doesn't it? Yes, sir. That's why I say that.

It doesn't really matter what I say. What matters is why I say it. Absolutely. And so what you've got to do is just figure out, okay, this is why. And so now you can make your own decision. Do you want 1.7 or do you want 1.3 after taxes? And, you know, you can decide. Do you want 1.7 or do you want 1.3 after taxes? And, you know, you can decide which one you want to do. But obviously, you're going to pick the big number. It's really not hard, you know. So there's a lot of mathematical discussions around everything with the Roth that people don't think about.

The actual facts are that people end up putting the same amount into a Roth that they would put into the other, even though it doesn't take the same amount of money to get there. It actually takes more money to get the same amount into a Roth because it's after tax going in. And so people run these hypothetical mathematical discussions trying to run it apples to apples. And in reality, the way people actually use the tool is not an apples to apples comparison. The way they use it is, he's going to put in 500 bucks, whether it's Roth or whether it's not. That's what he's going to put in. So it's not really apples to apples in that sense.

But still, just the same, the Roth is the way to go. Always do Roth. Always do Roth. Unless you're 60 years old or older, and then you can consider maybe going the other direction. And the reason is the illustration I just gave you. It's a $400,000 discussion in your example. Brooke is with us in Minnesota. Hi, Brooke. Welcome to the Dave Ramsey Show.

Hi, Dave. Thanks for taking my call. Sure. What's up? So I make a base of $54, Dave. Thanks for taking my call. Sure. What's up? So I make a base of $54,000. I have a profit share of 20% that I estimate to drop around February. I graduated in three years with my bachelor's, so I got out of it with only $20,000 worth of debt. And basically, I'm at the point where I'm going to start throwing $1,000 a month at my student loans, which is pretty aggressive. My budget's pretty tight. And the point where I'm going to start throwing $1,000 a month at my student loans,

which is pretty aggressive. My budget's pretty tight. And the only worry I have is my car has 230,000 miles. It's all paid for. You know, my auto insurance is like $20 a month, and I really like that. I want to keep driving it until it dies, but I'm scared how long it's going to last. So I was wondering if you think it's worth it for me to put up loans for maybe three or four months and save up like, you know, $3,000 or $4,000 just in case it does die so that I can cash flow a car

right away. I don't think it's going to completely die all at once. Cars typically are going to give you, they're going to give you a fit. I mean, it's a $1,000 car, right? Probably. Yeah. And so you have your $1,000 saved, right? Correct. So you can buy another $1,000 car. That's true. If it did go completely dead on you. And the trick is, the way you've got this lined out, as detailed as you are, even in just your discussion with me was so precise, I predict you're probably going to do this a lot faster than 20 months

anyway. I wouldn't. I would just sit there going to do this a lot faster than 20 months anyway. I wouldn't. I would just sit there with my $1,000 emergency fund. I'd take good care of that little car and let's get to work and let's get this debt cleared. That's exactly what I would do. Hey, thanks for the call. This is the Dave Ramsey Show. Let's talk about low interest rates, baby. I know right now that Churchill Mortgage can get qualified buyers into a 15-year conventional loan for well under 4% with no discount points or no hidden fees. Listen, if you're even thinking about buying a home or refinancing, do it right now. These rates are incredibly low. Here's what I'd like you to do.

Take 10 minutes and call Churchill Mortgage and see what you can qualify for. So even if you have to get creative and buy something further out of the city to get something you can afford, now's the time to make the move. That's why I'm sending you to Churchill Mortgage. I trust them to look out for you and your budget. Don't miss this opportunity. You can secure these low rates now for up to 90 days through Churchill Mortgage. Call 888-LOAN-200. This is a paid advertisement. NMLS ID 1591. NMLSconsumeraccess.org. Equal housing lender. 761 Old Hickory Boulevard, Brentwood, Tennessee 37027. Abraham is with us in Florida. Hi, Abraham. Welcome to the Dave Ramsey Show. Hey, good afternoon, Dave.

Good afternoon. I'm 23 years old. I work as a sales associate, and I recently started listening to your show, and I've become a fanatic. I'm in a bit of a debt situation, and I just don't know how to tackle it. Okay. What's your debt? I am $63,300 in debt. And you're 20 years old? 23.

23. Okay. What's your $63,000 on? What kind of debt? All right. Well, I just recently started listening to your show, so don't ask. It's three car loans, but it's a little bit of a unique situation because those three cars that I have, one is $33,000. The second is $18,300. And then the one which is personally mine is $5,000.

Out of those three, two are under me and my father, who recently, last year, after being unfaithful to my mother, left the household. And so he left me as the head of the household. And so when are you going to sell the cars? The problem is that... Hold on. Give me one second so I can get my composure here. All right. So it was a little before I started listening to your show and essentially getting into the finances, personal finance. So I was a little bit ignorant as to how it worked out. So I did essentially lend him my credit. So that debt is partially mine, but I can't sell those cars because he's still using them for his small business. He had a

big grand idea of opening up a small business, which he did. And those are his two primary vehicles for work, which he uses. So he's still paying them. The problem is they're not prompt payments. And it's just a matter of time before he defaults on one and it basically snowballs into what i'm not looking towards to bankruptcy are you are you on the on the title i am well if i'm the co-sign of the one of them on the loan i understand that you co-signed the loan are Are you on the title? Are you the owner? That I'm not aware of. You don't know?

I don't know. Okay. Wow. Okay. This is not going to go well, Abraham. I figured, but. Yeah. So one of two things is going to happen your dad is going to bankrupt you or you're going to have an ugly confrontation with your dad to stop this from

happening all right so the only other option he has offered which i still want to go through with but it's the only other i guess feasible option of the two vehicles, he only uses one of them for his company use, and the other he actually rents out to somebody else that does transportation jobs, and essentially he sold out the payments of the second vehicle from that person that he rented out to. His offer was to refinance those two vehicles into one payment and then just paying that off as one vehicle. As long as he takes your name off the loan, but that's not what he's talking about. Yeah, that's the thing.

Here's my offer. Here's my offer. I'm your 23-year-old son. You should quit screwing me. You should sell these cars immediately instead of taking advantage of your own son and setting him up for bankruptcy. So if you, and you need to find out if you're on the title, and if you're on the title, you need to see a lawyer and go pick the cars up and sell them.

Okay. Because here's what's going to happen. This guy's, I'm sorry that your dad is a skunk, but your dad is a skunk. Yeah. I'm so sorry. I mean, it's hard, it's a hard thing to go through. If you're 43 or you're 23 or whatever three you are to find out that your dad's a skunk, but he is. And he's not a good man.

Who would do this to their own son? I don't know. Yeah. After listening to your show, I managed to get my mom out of bed. Yeah. She currently has a part-time, and me, my sister, and her, I've been. Abraham, what city are you in? Miami, Florida.

Okay. Are you in a good church by chance? Yeah, I am. My little sister is actually well-involved in our church. Miami, Florida. Okay. Are you in a good church by chance? Yeah, I am. My little sister is actually well involved in our church. I just don't have time. I'm juggling right now. I understand. That wasn't what I was asking.

I'm just trying to find out what's going on in your life. Because what I need you to do is I need you to holler at that pastor in that church and sit down with him. Because you need a guy that's got some more experience to walk with you while you're walking through one of the most difficult things in your life and you just need it you need a big brother right now right yeah and um i wish i was there i could do it for you but um this what i'm asking you to do at 23 years old is very difficult and you know and it's very emotional and and your family is going through a very very hard time and so it's just going to be good for you to get some men in your corner that have good values that can be there with you and be strong with you

and help you to get the things done that you need to do because you need to really figure out what's going on with these cars and get them sold but it's going to be a very you know your dad is going to have a fit and all this kind of stuff and so you're going to have to have some people in your corner that they got your back you know nobody's got your back right now yeah i do but i'm on the radio in nashville so i can't help a lot you know yeah i'm cheering for you i want you to do it because if you do if you if out of the pain of your family separation and the fear of your father's reaction if you do nothing what we you and i both know is he's not going to pay the payment, and eventually the car is going to get repoed,

and eventually they're going to force you into bankruptcy. You already told me that. So doing nothing is not a very good plan. I tried looking for the option of actually selling through Kelly's Blue Book. I was able to get the value of one of the vehicles, but even if we sell it, the difference, we would not be able to pay back because right now

what I have saved up is just for my emergency fund. I've been looking at your baby steps. Who are these cars financed with? One is financed through Ally Financial and the other is through Chrysler Capital. So you've got a high interest rate, too. That is correct.

On one of them, it's 11%, and the other, I don't remember. Yeah. Okay. And every month, he has late payments. So not only is he paying interest, he's paying penalties, too. And every month, your credit gets worse. Well, thankfully, he hasn't gotten to the point where it's past 30 days late i always make sure that i nag him till the last couple days to pay it on

time and he somehow manages but i'm scared of the day that he won't be able to manage to make a payment and then that's when it affects my credit yeah yeah well every time he's late every time he's late it affects your credit that's what it comes down to. Correct. So, yeah, you need to holler at the pastor of the church that your sister's attending, ask if you can sit down with him and see if he can help you get involved in your family situation and be the person that walks with you and gives you some extra strength of a good man standing beside you while you make some of these difficult decisions. You'll have to borrow the difference from your credit union. I suspect you can probably do that to cover the deficit.

But I would rather these cars be gone, your dad not be responsible, and you personally be responsible for $5,000 or $10,000 of deficit than I would you be, you know, we're talking about $50,000 in debt here on two cars. I've not thought about that, the credit union option. You know. All right. And so, and I'll tell you what, hold on and I'll have Kelly pick up and see if we have a financial coach in the area that can help you and walk with you as well.

But you're just, you know, you're just, I'm asking you to do a lot of really, really tough stuff to face down your own father. And that's just hard to do, man. And, you know, you got to really have some people in your corner to go, Dad, this is not okay. You're screwing me here. You're screwing your own kid. Who does that?

And, you know, some people do. Sad. So, hang on. Kelly will pick up and we'll get you some help. This is The Dave Ramsey Show. We'll be right back. We've been voted one of the best places to work in Nashville 11 times. You want to know how we do it? Well, our team has been using LinkedIn jobs for years to find the best people from all over the country to come and help us change lives. Think about it.

LinkedIn has more than 600 million active members. I'm talking about people who come to LinkedIn to make connections, grow their careers, and discover new job opportunities. In fact, 90% of LinkedIn users are open to new opportunities, but not actively scanning job boards. This means LinkedIn Jobs gives you access to an entirely different demographic. Don't wait. One hire can change the direction of your company.

Post a job today at linkedin.com slash Ramsey and get $50 off your first job post. That's linkedin.com slash Ramsey. Terms and conditions apply. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. Donna is in Virginia.

Welcome to the Dave Ramsey Show, Donna. Hi, Dave. How are you? Better than I deserve. What's up? So, I hate my car and um i owe just under nine thousand dollars on it and kelly blue book to see the value and a private seller i would get a maximum of six thousand dollars um my car payment a month is 244 my car payment a month is $244. My car insurance a month is $250. I am really struggling to save money and to pay off debt. I make $40,000 a year

and I'm not sure what I'm doing wrong and I don't know if it's a good idea to sell my car and pay the bank the remaining balance and buy a little cheap thousand dollar car or if I should just pay this car off. You have any money in savings that's not in retirement? $500. Okay. And you're single? Yes. Children? No.

How old? 27. What do you do? I treat wastewater. Okay. All right. So you work 40 hours? Yes.

Okay. All right. Well, the bad news is that you're upside down on your car. The good news is you don't owe a lot of money on it. And so if you were to, say, deliver pizzas four nights a week, make about $1,500 a month extra, you would be debt-free in about seven months on this car. Or pay the car off. Yeah, or do something else.

If you've got a better side hustle in mind, I just made that one up, okay? But, I mean, it might be that you might make more of being a nanny on the side or a dog walker. I don't know. I mean, there's people pay for all kinds of stuff out there, right? And, you know, I don't know what your training is in and what you could do. But what I do want you to do is work more and make more for a short period of time to break this up. It's all stopped up, right? And so what we've got to do is put the plunger on it and that's some extra money right

now and that gets it moving again and it's just and it's not forever i mean it's like six or eight months you're just going to work all the time okay and you have any other debt other than the car i have a personal loan um through the same bank that i have the car loan and uh just medical what's the balance on that, those two things? My personal loan is $600, and my medical bills are about $6,000. Okay. All right. So the really great news is $15,000 makes you 100% debt-free.

That would be pretty cool. Yeah. And so I'm going to put you on the, you know get your 500 up to a thousand you need to have a thousand dollars for your baby step one and then we're going to list your debts smallest to largest we're going to get on a written detailed budget on the every dollar app it's free to use go download it for your phone do your budget takes you about 10 minutes to do your budget every one of your dollars coming in has a name, and then go bring in some more dollars. Make the dollars that you have behave, and let's knock this out in under a year. Awesome. And you have zero payments.

If you had zero payments, your life would be completely different. That's safer house. Yeah. You could build up an emergency fund The 28 year old you is going to love The 27 year old you But the 28 year old you is going to be a little tired Because you will have worked a lot more

In this coming 12 months Okay But it's only a year I mean you can do a lot of crap for a year right Yeah You can put up with anything for a year Can you get a bunch of overtime at work that pays more? I can pick up a couple of shifts.

So I could get shift differential that way, and that would bring in an extra $200 a paycheck. And you get paid twice a month? Yes. That's $400. Okay. And then let's pick up, you know, you know just so again we can do a lot of painful things if it's for a short period of time so that we don't have more pain because right now you've got the pain of being broke yes and we want to get rid of that so if you're debt-free

then you could just take this six thousand dollar car and you could say i'm going to sell it and get me another six thousand dollar car that I actually like. Yes. That would work too. So that's the kind of plan I'm getting you on. And then you could save up a little money and buy a $10,000 car. It'll only need to be $4,000 more. Once you start getting control of your money, the whole world opens up before you, right before your eyes.

And so get on, get the EveryDollar app app i'm going to send you a copy of the book the total money makeover hold on kelly will pick up and we'll give that to you as our gift it shows you exactly how to do the baby steps and exactly how to work what i'm talking about but this is all about you just increasing your income and making the income that you have behave and let's start hitting some of these goals because you feel stuck right now, and that extra money and that extra intentionality and purpose with that budget is going to be the plunger that unstops this thing. All right, Charlie is with us. Charlie is in Wisconsin.

Hi, Charlie. Welcome to the Dave Ramsey Show. Hey, Dave. Thank you for taking my call. Sure. What's up? So I started listening a little over three weeks ago. I'm currently in baby step two. And I had, when I took my current job, decided I was going to

set aside about 10% of my income for charitable contributions in a completely separate account, separate from my spending accounts. Okay. Right now, I have about $3,500 in that account, and I wanted to know if I should keep that separate and keep that money available for charitable contributions, or if I should roll that into my Baby Step 2. Okay. And so, why have you not given it to charity already? I give throughout the year as I come across things that kind of speak to me. Often towards the end of the year, I'll take the remainder of the account and donate it to St. Jude's. Okay. All right. Cool. All right.

Well, I mean, that has the same effect as someone like me that's a christian tithing to their local church right yep this is 10 percent and so you're you're giving 10 is what it amounts to and you're choosing to hold it in a separate account so that you have a good accounting of it and it doesn't slip away in accidental overspending. As long as you're giving it away, that's fine. But don't get confused and go, oh, I just decided I'm really using that for a bass boat. Right. No, not while you're in debt, Charlie. No, I mean, if you want to give it away, give away 10% of your income while you're working your way out of debt, I think that would be consistent with people of faith doing that as a, you know, a tie that

their local church. So there's not an inconsistent thing for you to do that. I wouldn't do much more than that. And I do want to make sure that you are actually clearing that account every so often, but you sounds like you've got a plan to do that. If you haven't found the, the need hasn't crossed your path, then you just, you know, you give it to St. Jude at the end of the year. They're a wonderful charity. Made donations ourselves. And so, wonderful place. So, all of that sounds good.

Yeah, I think that's fine. Hey, thanks for the call. Open phones at 888-825-5225. You jump in. We'll talk about your life and your money. My husband and I are finishing paying off our debt by the end of the year. Woo-hoo! And then we're saving for Baby Step 3.

And then we're going to save Baby Step 3B to buy a house. Can you give house-buying advice for us? We know nothing and have no idea where to start. Get a good real estate agent that knows what they're doing to walk you through the process. They're not there to sell you a house. They're there to give you good house buying advice, a good buyer's agent. And you can check in with our real estate ELPs. They'll help you do that at DaveRamsey.com.

Click ELP, click real estate, and they'll help you do all of that. The trick is a house that is ugly or poorly designed that is a bargain is not a bargain. When you get ready to sell it, it's going to be ugly and poorly designed. And you're going to have to give someone else a bargain. So, you know, it's okay for it to be a little bit generic and predictable, more so than a white elephant. That is a quote-unquote bargain. This is The Dave Ramsey Show. Right now we're celebrating Financial Peace University's 25th anniversary, and that means we're also celebrating 25 years of our rock star coordinators.

They're the heartbeat of Financial Peace University. Nearly 6 million people have been through these classes at about 50,000 churches over those 25 years. And volunteer coordinators lead the class. They play the DVDs. They put the chairs in a circle and create the accountability groups for encouragement and accountability in the discussions. And they're what makes the world go round.

They have the front row seat for changing everything, a front row seat for life change. If you'd like to help change people's lives as a Financial Peace University coordinator and you want to get started, text LEADFPU to 33 789 text lead fpu to 33 789 speaking of coordinators steve is on the line in pennsylvania steve is a coordinator hi steve how are you hello dave great to talk to you you too sir so how many classes have you led well i lead our stewardship ministry financial peace ministry at our church and uh since we went to all fpu classes in 2010 we're offering our 52nd one uh later just in september wow amazing thank you what got you started doing this well i i what got me kind of in the stewardship areas i still remember it was back in 2002 and i had this desire to start reading stewardship

books i read everything that you and blair burkett wrote and i didn't understand why and then the next uh next uh few months our church started a stewardship ministry, and I got involved. And so when I look at the—and the more I get involved, the more I understand that the average Christian's finances looks just like the culture. And so that breaks my heart. And so I found out if I can just lead a class and help someone else lead a class, I can make an impact. Wow. Okay. So what happened in your life? Well, my wife and I, well, I didn't do quite the stupid tax that you did, but I did a pretty good job. Two weeks before we got married, and that was in December 2004, I lost $100,000 in an investment invested in things that I didn't understand.

And so we started out, not necessarily to say that that was quite a start, but we got back from our honeymoon and started Baby Step 1, drained our savings, and went walking right up the baby steps. So that's what got you started. All that pain got you started reading these stewardship books well i mean it it it played into that and the next thing i knew we were walking up the baby steps and starting to experience god work in our lives and we we moved all the way up to baby step to seven in 2009 wow very very cool so you paid off all your debt. You built a net worth. Are you probably an everyday millionaire yet? We could be in Chris's book.

I love it. Very good. I'm proud of you. Very, very cool. Thank you. Good for you. That's fun. That's fun. So you've probably seen 52 financial peace classes. You've probably seen some pretty serious stories you know dave we've seen uh everything from a couple come to our class and they later told us that they were meeting with divorce attorneys and by the end of the class uh completely called that off uh to this one one story that really impacted me was just earlier this year a lady came that was uh she was getting disability pay i found out she only made sixteen thousand dollars a year and she was hopeless and so so that i mean i hear a lot of debt paid off but watching this lady her just her demeanor changed during that class to where she was on a budget and she paid off debt while she was in there, and other people say that's not possible, but she did it.

While making $16,000 a year? Yes. Wow. Very, very cool. So if somebody calls you up and says, Hey, Steve, I've heard you've been leading all these FPU classes. Should I lead a financial peace class? What do you tell them? Certainly. If you're willing to do the work and work right alongside with the class, then there's no reason not to because the impact is right during the class.

During nine weeks, you can see life change happen right before your eyes. There's no reason not to. Yeah, it's really rewarding. Hey, man, thank you so much for being a coordinator. We really appreciate you. 52 classes led and went from broke to being a millionaire in 11 years. Wow, that's pretty cool. Good for you, Steve.

Very, very proud of you. And thank you. Thanks for being part of our team and one of our many coordinators across America. So, folks, if you do want to do this, if you'd like to get started leading a financial peace class, again, just text LEADFPU to 33789. That's the number to use, 33789, and you text the word LEADFPU, and our team will get back in touch with you and show you exactly how to do this. So very, very good job. Appreciate you joining us.

Open phones at 888-825-5225. Y'all jump in. We'll talk about your life and your money. Andy is with us in Pennsylvania as well. Hi, Andy. How are you? I'm doing well, Dave. I'm so excited to talk to you.

You too. What's up? Okay, so I recently paid off my credit cards about three weeks ago, but I've been hesitant to close out the account just because I'm going to Australia in October for a trip. Oh, good. I'm going in February.

Oh, well, too bad we missed each other. It'd be a fun trip. Yeah. I am hesitant to close out the one because it has zero foreign transaction fees and my debit card has a five percent i have a different debit card oh okay why is your debit card ripping you off it's a through uh can i say sure uh pnc bank okay that's my debit card yeah we'll get a different bank that doesn't have a rip-off fee.

I mean, we've traveled Europe. We were in Africa last year. We go everywhere with a Visa debit card, never have any trouble, and I've never gotten ripped off on transaction fees like that. That's absurd. Okay. Yeah, just make sure your bank is not screwing you over on that. That's all.

Yeah. No, I wouldn't keep a credit card. I don't have any reason to keep a credit card. And I travel more than any two of you people out there put together. Hey, thanks for the call. Open phones at 888-825-5225. Joyce is next. Joyce is in New Jersey.

Hi, Joyce. How are you? Hi, Dave. Thank you for taking my call. Sure. What's up? So my husband and I are currently in step two, and we're trying to pay off about $61,000 from school loans to school loans and a car payment. Yeah.

While we're working to finish this, we do have a house, and we've realized that our oil tank gets underground and we're thinking about converting. So in addition to our $1,000 savings, we also have like about $10,000, I guess you could say emergency funds, but we don't know if it's a smart decision to convert or just put that into our snowball. What is your household income? So we make $111,000 to $135,000 roughly. Okay. And you have $60,000 in debt and $10,000 in the bank. Yes. And out of those 60, 10 of them is for a car that we lease and we're buying out,

and about 40 of it is a my school loan, and 15 is his. Okay. All right. So if you had $50,000 in debt and $100,000 income, how quick are you debt-free, two years? I think two years. That's what we're aiming. I don't know if that's realistic.

We're hoping. I think it's realistic. I think it's a minimum. Probably I'd do a little faster than that, actually. Okay, perfect. But what we teach is any money that you have, any investments that you have, anything that you have other than retirement savings, you sell it and you use it to get out of debt as fast as possible and anything that's not

an emergency waits until we're out of debt and so in your scenario what we would have done is we're going to take your ten thousand dollars we're going to throw it at your debt snowball and as fast as possible we're going to be on a really really tight budget not going to see the inside of a restaurant unless you're working there we're're not going on vacation. Christmas is a craft. Beans and rice, rice and beans. And we knock out this debt as fast as we can. I'm thinking 18 months actually. And you should be done with it. And then you start talking about saving up and getting your emergency fund full. Then you talk about upgrading your heating system. Hey, that's about a two-year plan. 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.