The Ramsey Show - App - More Intentionality Can Lead to More Income (Hour 1)

Episode Date: September 17, 2019

Debt, Home Selling, Career, Savings, Budgeting   Tools to get you started:  Take TDRS listener survey to win a $100 Amazon gift card, click here: http://bit.ly/2krRePv 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 done, 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, America. It is a free call anywhere in North America, and some say the advice is worth exactly what you pay for it. The phone number is 888-825-5225. That's 888-825-5225.

Christina's going to start us off this hour in Virginia. Hi, Christina. How are you? Hi, Dave. Good. How are you? Better than I deserve. What's up in your world? Awesome. So I am currently working as a real estate agent. I started in May and I've been doing it full time. We have four kids and we just started the Financial Peace University and we're on baby step two. We have $70,000 in debt and have a household income of about 130 a year. Obviously my career just got started. And like I said, we have four kids. Two of them are just starting school this year. And we have two that have been

in childcare full time. That class is about 2000. So my husband and I were re-evaluating of either putting them in part-time, which would reduce our child care costs to $1,000, and we would basically break even. And that's with my average income right now from real estate, or pull them out completely, which would allow us, it would free up $1,000 to go towards paying off our debt. And based on how we've mapped everything out, it would allow us to move up our timeline by about six months. So my question to you is...

So my question to you is, do you want to be a real estate agent or not? Yes, I do. What have you got to do to make more money being a real estate agent because you're not making enough money because only $2,000 is making the swing for you here? True. Yeah, I guess I'm trying to, with such young kids, I'm trying to balance being a stay-at-home mom too. So I guess that's me figuring out which one I would rather do.

Yeah, what I would just say is decide what you want to do and do it. Okay. My mom was a real estate agent when I was growing up. Okay. And I have never been in therapy as a result. Valid. Yeah, we're just trying to make sure that we're getting this paid off as quickly as possible, and I guess this is very well-known.

Yeah, but the whole thing is, you know, you've just been going since May. And so what you've got to say is you're projecting a beginner's real estate income as your future. And that shouldn't be your future. I mean, one closing a month more than you've been making, and you'd never have made this phone call. Yeah. Okay. That make sense? Yeah.

And I'm okay. Listen, if you want to be at home full-time that sharon's raised our kids she was home full-time 32 years you know has been has been there for 32 years 34 years now probably but and that's cool i mean i got no issue with that i love that it's what do you want to do my mom wanted to sell real estate consequently i learned to make hamburger helper you know so it's okay you know and i live through it and and everybody's good and and you know she i'm the child of an entrepreneur you know and so you you do what you can do either one and and i'm not going to shame you for either

one i think where you're struggling is is that um you just haven't made enough money in real estate yet and you can't see yet how to make that money, and I'm going to challenge you to see a way to make that money, or just pull the plug. I wouldn't try to do the halfway thing. That'll drive everybody crazy. Okay. Well, that's reassuring to hear,

because that's what we were pulling towards. Either go all in one way or the other. That's what I would tell you to do be the best of whichever one it is you're going to be and uh i'm i'm good with it though and i you know you're gonna the money will work out the baby step two will work out i wouldn't make this big a career choice abandoning something you've worked on that you have a dream of doing um based on you know i get out of doing based on, you know, I get out of debt six months sooner.

No, I think you plow through. And I would turn up the heat and the activity level if you're going to stay in real estate, get your income up, and get out of debt just as fast as you would have by trying to cut expenses. So good questions, good discussion. Thanks for the call. All right, Hannah is with us. Hannah is in – oh, wait, what in the world did I do? I'm pushing wrong buttons.

There we go. Dave did not do this. Hannah is in Ohio. Hi, Hannah. How are you? Hi, Dave. Great. How are you?

Better than I deserve. What's up? All right. So I had this question. It might be an age-old question. I don't know. So we currently have a lot, a lot of equity in our home, and we are wondering if we

should go ahead and sell and put that money towards our student loans and our credit card debt. How much equity do you have in your home? I would say around $160,000. And how much student loan debt do you have? $53,000. Well, is it student loan and credit card or just student loans? Student loans are how much? What did I say? $43,000. Okay. And credit card or just student loan? Student loans are how much? What did I say? $43,000. Okay.

And how much are your credit cards? $10,000. And how much are your cars? None. We have no car payments. Is this your only debt? It's $53,000, not counting your house? Correct.

Yep. What do you owe on your home? We owe $136,000 right now. $136,000. What's your household income? about 95 000 do you like your house yes we love it i would not sell it i'm great neighborhood i would not sell okay no okay it's listen here's the thing 53 000 out of 93 000 almost makes it in $90,000 income, $53,000 in debt, almost makes it in one year on beans and rice. It surely makes it in two years.

Sure, absolutely. $26,000 a year for two years. I mean, that's a wimpified making $90,000. So somewhere between one year and 18 months is where you're going to land. Okay. I wouldn't sell're going to land. Okay. I wouldn't sell my house for that. Okay. Unless you want to move anyway, and while you're doing it, you clean up the mess, you know, that kind of stuff.

But no, no, no, no. How long have you been working on getting out of debt? You know, not too long. I had this income just increase about two months ago. How much did it increase? About, let's see, $30,000 a 30 000 a year whoa nice and you haven't even had time to get used to that yet no not at all right so if we just throw all of that at the debt yeah you're out in two years that's true much less much less sacrifice actually cutting something

out of your lifestyle god God forbid. Right. Right. I suppose right now. This makes sense. Okay. And, you know, this is what my husband was saying, but I said, I'm going to call Dave. I'm going to find out. Well, I appreciate you checking in, but I think you guys already kind of were on the right track.

And here's the thing. Okay. Here's what's going to happen. When you actually start doing your budget and you go, wow, where's all this money been going? We're going to start doing this at the debt. Dave's right. We can do this probably 14, 18 months, whatever it looks like there. Certainly with the increases, we know we can. Because you really haven't had a chance to get used to them.

When you actually start and actually the debt starts going away and you get more and more excited, then you're going to be really glad because you're going to pour through this really fast. You're going to be great. You're going to do great, Hannah. This is the Dave Ramsey Show. Business leaders, if you're not using LinkedIn Jobs, you're missing out. Our Ramsey Solutions Company page on LinkedIn has over 100,000 followers. That's 100,000 potential like-minded people our team communicates our current openings to.

We also post our jobs on LinkedIn because we know the best candidates already have jobs. And LinkedIn makes it easy by doing the legwork for you. 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. Get started today with LinkedIn Jobs and get $50 off your first job post. Visit linkedin.com slash Ramsey. Terms and conditions apply. Well, I'm always telling all you guys what to do. How would you like to take a shot telling me what to do?

Well, we're running a survey, and the survey is all about what you think of the show, what you would like to see more of or less of on the show. And it's a brand-new survey. We'd love your feedback. Go to DaveRamsey.com slash survey. And it takes just a minute or two to take a quick survey on the Dave Ramsey Show. And there's a $100 Amazon gift card that's going to be drawn from the people that are going to draw from the names from the people that fill out the survey.

Going to give someone $100. Pretty cool. You can also text the word survey to 33789, davramsey.com slash survey, or text the word survey to 33789. Nick is with us, and Nick is in D.C. Hey, Nick, welcome to the Dave Ramsey Show. Hey, Dave. Quick question.

So my wife and I, we bought a house about three months ago in the great D.C. and metro area. So we have the possibility to pay $30,000 extra onto the mortgage over the next year, which would bring us to 80% loan to value, letting us get rid of PMI. The PMI right now is about $2,000 to $3,000 a year, which would be almost about 12% return on our money if we got rid of the PMI. I really want to do it. It's kind of my I had it moment, but my wife's pushing back on it. We have about $21,000 in savings, but she considers $15,000 of that kind of a nanny fund for whenever we have a kid. You don't have a kid yet and you have a nanny fund? Yes. What do you make a year?

Last year we cleared about $170,000, and I think this year probably going to be close to that, and I think in 2020. So if you hired a nanny and the nanny fund was used up on the nanny after that, because $19,000 is not going to take you that far on the nanny fund was used up on the nanny after that, because $19,000 is not going to take you that far on the nanny. Then you're just going to have to start paying the nanny out of your income, right? Exactly. Which is what, like, most people do. Yes. I don't understand the need for a nanny fund.

I agree with you on that. It's not logical. It's just a budget item, and it's not a budget item until you have a nanny fund i i agree with you on that so it's not logical it's just a budget item and it's not a budget item until you have a nanny exactly yeah so i she loses the argument um i'm fine i'm fine with you making 170 000 a year you're both obviously high income professionals and hiring a nanny would be a very normal thing in the course of business here. But just paying monthly, it's like having a maid. You pay the maid, pay having somebody do your yard. You don't have a lawn care fund. You just pay the guy to do the yard, right? Okay, great.

So you like the idea of paying the $30,000 over the next year. Do you have any other debt other than your house? That's it. Okay. Yeah, definitely I would do that. Above your emergency fund, you're in baby steps four, five, and six? Yes. It's not about the rate of return.

It's just I hate PMI. It's just such a ripoff. And it is a great rate of return in your case, too. So, yeah, you win the argument all the way around. I would lean into this and knock it out. It makes sense. And the point is not that you nor I are suggesting that you not have a nanny when you have a baby.

But until then, there's not much need for one. And so, yeah, it's just that sweet. All right, Michelle is with us in Nevada. Hi, Michelle. Welcome to the Dave Ramsey Show. Hi, Dave. So we are on baby step number two, and I'm wondering if I can quit my part-time job. Okay. How much do you make on your part-time job? $300 a week on average. Okay. How much debt do you have, not counting your house?

After this month, it'll be down to $2,600. What's your husband make? $93 a year. We have four kids, and our two youngest are girls. They're 9 and 11, and I normally work on the weekends, and they've been saying that they want to spend more time with me, so it's been weighing on my heart. Okay. Well, the numbers say that the work that you're doing on the weekends is not moving the needle much on the getting out of debt part. Your husband makes $93,000 and you make $1,200.

Yeah. So, I mean, if you were making $12,000, I guess we could think about, you know, their little hearts having a little weight on them. But, you know, it's not that big a deal, right? No, I'm just wondering if I should wait until January and get through this kind of busy next few months that we've got gearing up in my line of work, or if I could just quit now and enjoy the holidays with my family. Okay. Well, you can do whatever you want to. You're an adult. I mean, you guys get to decide.

Here's the thing. Every dollar you make that anybody makes in this household clears up the debt. You only have $2,600 in debt left, and your household income, if you quit, is $93,000. Did I understand that right? Yes. Okay. And so I don't want to be disrespectful, but mathematically speaking, your part-time job is irrelevant.

Mathematically. Does that make sense? Yes, it does i've just been working in this field of work for 24 years and so i'm so used to working that um i think that plays into it a little bit too the fact that i would quit and just be at home yeah but you told me two different times two different ways that this was a heaviness on you. Like you said, I'd really like to enjoy the holidays. And then you said, it's been weighing heavy on my heart that my kids are griping about me being at work.

Right? Yes. Okay. And so I think that outweighs any loyalty or obligation you've got to you've been in this business for a long time or whatever. Now, again, if you're making twelve thousand dollars a month everybody can stop whining and you can tough it out till january right but you're not you're making twelve hundred bucks and in the and if you if twelve hundred bucks was your only income you'd have to tough it out but it as a portion of your household income it's a very very small portion of your household income, it's a very, very small portion of your household income.

And that's not being disrespectful to you or even to what you're doing. It's just a math observation. So if I were you just listening to the words that you're using to describe this, I think you desperately want to quit. I do. Then quit. Okay. I do. Then quit. Okay. And take a bunch of crap that y'all have been doing lifestyle-wise around your house out of the budget.

Cook from scratch and coupon. And let's put the kids on consignment sale clothes and let's get this debt cleaned up and get that emergency fund funded. And you become a home economist while you're at home with these kids but but if you want to quit it's not again it's not irresponsible in your situation hey thanks for the call jacob is with us jacob is in georgia hi jacob how are you hey dave uh so basically i've got 6.5 acres off of the Tennessee River that I'm trying to kind of decide on which route to go in a way, but I'm not sure on the entire validity, so I wanted to get your opinion. I'm trying to decide, like, whether to go and, like, basically what I want to do is start a small business where I'm either building, like, where I'm either building like where I'm building a like vacation kind of getaway like cabins on the property or one of the other things that

was was I was thinking about were tiny homes but I've had some people kind of say like yeah I don't know about like doing tiny homes on the property because that's that may just be a fad that goes away so I wanted to get your kind of opinion opinion on whether or not you think that that's something that's like a fad that maybe down the road isn't really going to be that valid or whether I should just go more of a traditional hard-standing building kind a deal with the property. So if you build cabins on this property, you're going to build them with cash? So yes, yes I am. What would you spend to build the cabins?

So each cabin with the company that I've already looked into, each cabin would cost me roughly $40,000 for each one. They're going to be on the smaller side. And how many of those would you build? So with how much I have right now, I would only be able to build one right off the bat. Okay. And how much rent would you collect in a year on that? So it would be about, so from the comps that i've looked at

it'd be about 140 a night uh and most of the places that i was looking at don't take you a long time get your forty thousand dollars back brother and no i'm not screwing with tiny homes at all there's no validity to that idea at all today i'm not sure either one of these ideas work you need to do some more math 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 four percent with no discount points or no hidden fees, 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 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. In the lobby of Ramsey Solutions on the Debt Free Scream stage, Nick and Courtney are joining us. Hey, guys. How are you?

Hey, Dave. We are wonderful. How are you? Better than I deserve. Welcome, welcome. Where do you guys live? Evansville, Indiana. Cool. And all the way down here to do a debt-free scream. Yes, sir. How much have you paid off?

We've paid off $62,008. Good for you. And your range of income during that time? We started off around $80,000, and this year we should clear right around $150,000. Nice jump. What caused that big jump? Being intentional. Getting intentional about everything.

I'm a service technician at a Chevrolet dealership. And my wife, we run a food truck also. And it had just been kind of a side job until we really got serious last year and wanted to really hit the ground running and get this thing paid off. So you got geared up. Yes, sir. And almost doubled your income. Yes, sir. That's pretty your income. Yes, sir.

That's pretty incredible. Well done. So what kind of debt was the $62,000? We had some credit cards, a lot of medical bills, just things of that nature. Student loans. Yeah, student loans. That's right. That's right, yeah.

Okay. Did you sell anything big? Nothing too big. I did downsize. I had a Chevy truck that I sold for $6,000 and bought a $1,500 truck. And then we sold – we had a boat that we got rid of as well. That was – actually, I made money on that boat. It was awesome. Yeah.

Bought it for $8,000 and sold it for $11,000. So that was a win. Yes, sir. Good, good. Cool. So what happened that got you guys on fire eight months ago? You know, I have been at my job for about 10 years, and I've about doubled my income since I started, but I was still broke all the time.

Every time I look in the bank account, there wasn't any money there, and it was always paycheck to paycheck. And we just realized that we made too much money to be broke all the time and it was silly so um yeah we uh i my brother tried to tell me about you uh probably six or seven years ago and i just wasn't ready to listen and uh we just started looking up uh budgeting and things like that on youtube and came across you and uh that was it all a youtube thing all youtube thing love it very cool yes sir so once you came across you, and that was it. All a YouTube thing. All a YouTube thing. Love it.

Very cool. Yes, sir. So once you came across all that, what was the very first thing you did to turn things around? Budget, number one. Absolutely. Just had to figure out where that money was going and why we could never find it.

It took us five hours to do our first budget. Whoa! That sounds like a knockdown drag out. Oh, man, yeah. Well well we budgeted it out and well we were just overspending that much yeah yep that's like well there's that's where it's going that's where it's going oh there's where it's going oh there's where it's going okay yeah wow so what do you tell people the key to getting out of debt is well you know a friend of mine used to always tell me if i'm not making money,

I'm spending it. And so, you know, we just decided to keep making it. So we were pretty much just working all the time and being intentional, really seriously understanding

where your money is going is the biggest part of it, honestly. Between that, I mean, that, you know, that and budgeting goes hand in hand. Yeah, just working together

and making sure everybody's on the same page. Yeah, very cool. Very cool. Who were your biggest cheerleaders? Each other. Yeah. Each other every day.

Did anybody know you were doing this? Oh, yeah. Yeah, we've told everybody. We didn't keep it a secret at all. We want to help other people kind of do the same thing. So all of our friends, they're probably tired of hearing us talk about it we talk about all the time and so some of them say you were crazy yep yep absolutely definitely yeah got made fun of a little bit yeah yeah that that motivates you doesn't it yeah absolutely does a trash talk man that'll cause you to win the game

well congratulations you guys thank you dave how. How does it feel? It feels wonderful. It's amazing. Was it worth the sacrifice? It absolutely was. Because you guys have been living on nothing for eight months. Yes, sir. $50 a week grocery budget. It was intense.

We went vegetarian for a while. The cheapest stuff out there, yeah. Wow. Well, congratulations. Very, very well done. We got a copy of Chris Hogan's book for you, Everyday Millionaires. That will be the next chapter in your story. You're on your way, baby.

That's right. You did it. I love it. Nick and Courtney, Evansville, Indiana. $62,000 paid off in eight months, making $80,000 to $150,000 a year. Count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free! Woo! Yeah, baby! I love it. That is how it's done. Very well done. Man, oh, man. That's excellent stuff.

Our question of the day comes from Blinds.com. They have a 100% satisfaction guarantee that means even if you mismeasure, you pick the wrong color, they will remake your window blinds for free. And if you use the promo code Ramsey, you'll save even more. Today's question is from David in North Carolina. I recently had a friend ask me about purchasing an indexed universal life policy. Can you give me your thoughts on this type of policy? The person who shared this stated that it is a great option for people with higher incomes.

No, it is not. It's not a great option for anyone. An indexed universal policy is very simply an in a universal policy that is indexed, meaning the savings component of it is locked into or dialed into one of the indexes, usually the S&P 500. However, they don't pay that net of fees. The thing will net you more like 6% instead of 10% or 12%. And when you die, they only pay the face value, not the extra amount that you paid in for cash value. It is a horrible product. Cash value life insurance is not for high-income people. It's not for low-income people. It's not for middle-income people.

It's primarily purchased by the middle income. And people say stupid stuff like people with higher incomes by this but it's just not true they don't not ones that can do math anyway and the only people that believe in this stuff anymore are the ones that sell it none of the financial planning community teaches cash value insurance is a good thing anymore none of us that are in the advice-giving business teach us any more. You know, you're just really, really hard-pressed to find anyone that says that this stuff isn't just crap.

And that's exactly what it is. It's the payday lender of the middle class. It's a horrible, horrible product. It's expensive insurance and bad investments bundled together. Two dumb things bundled together, which makes it double dumb. So there you go. Bad idea. No, it's not.

It's a horrible product. Stay away from it. Always buy your life insurance as simple term insurance. And that's only if you need insurance. You may not need insurance. If you've got a million dollars in mutual funds and you have no debt and your kids are grown and gone and you die i think she can struggle through you probably don't need insurance so you don't buy life insurance as a wealth building thing you buy it to take care of

your family because you haven't yet built wealth you're 32 years old you've got three little kids and a mortgage and a student loan that's been around so long you think it's a pet. That's when you need life insurance. And you buy inexpensive term insurance, 15 to 20-year level term at that point. And that sets you up to take care of your family until the kids are grown and gone, the mortgage is paid, and you've built some wealth. But that ought to be the course of your life. You ought to become successful. The kids should grow up, and then they should leave.

That's part of being successful. They need to leave, and they can come back when they have grandbabies. Until then, just stay away. The mortgage should be paid off because we never tell you to take out more than a 15-year fixed-rate mortgage. So if you're 30, when you're 45, your mortgage should be gone. Interesting. Kids are grown and gone. The mortgage is gone.

Oh, if you were doing baby steps and you did baby step four and you put 15% of your household income in a decent growth stock mutual fund over a period of 15 or 20 or 30 years, you generally would have around a million dollars, depending on what your income would be. So if you had a million dollars, the kids are grown and gone, and you had no mortgage, would you need insurance? No. Because it's not an investment. It's something you buy until you have investments.

And you'll never have investments if you buy crap like indexed universal life policies. Now, go to Zander Insurance, Z-A-N-D-E-R, zanderinsurance.com. Get a quick, easy quote on your term, insurance. It's all I buy. It's all I suggest you buy ever since I've been on the radio for almost 30 years now. I've been very, very consistent. Why? Because I'm right. This is The Dave Ramsey Show.

Hey, guys. At The Dave Ramsey Show, we really value your input. It helps us to know what's important to you so we can deliver relevant content to help you crush your money goals. We just launched a brand new survey, and we'd love your feedback. It only takes a few minutes, and you'll be entered to win a $100 Amazon gift card. No purchase necessary. Take the survey at DaveRamsey.com slash survey or text survey to 33789. Daniel is with us in Oregon. Hi, Daniel. Welcome to the Dave Ramsey Show.

Hey, Dave. How are you doing? Better than I deserve. What's up? All right. So my question is basically, I have a small 529 for my kid administered by USAA, and I'm not very impressed with the performance. And I'm wondering if it's possible to transfer institutions for the 529.

Say, like, USAA to Vanguard. Yes. Or so. It's a rollover, just like rolling over an IRA. Okay. And do you know if you can transfer it for the state that it's administered from? Because I think USA is a Nevada 529. Like, say, I wanted to move it to, say, an Oregon one, for instance.

Is that possible? It's not a problem with the feds. It's just a matter of whether those two states will interact with each other. And the easiest way to handle that is just go to one of our SmartVestor pros and talk through the whole college to handle that is just go to one of our SmartVestor pros and talk through the whole college planning strategy that you've got, the college saving strategy, and they can help you make this one move too while you're at it. Just click SmartVestor at DaveRamsey.com and they can help you pick some mutual funds as

well and help you do the transfer. Hey, good question. Nicole is with us. Nicole is in Michigan. Hi, Nicole. How are you? I'm fine, David. How are you? I'm fine, David. How are you?

Better than I deserve. What's up? Well, a year and a half ago, a young man ran a stop sign and rolled maybe a call with me and my children in it. We have been on a route to recovery for this last year and a half. Because of this, we have insurance money coming our way, and my husband and I want to do the best we can possibly do and make some good choices with this money, and we don't know where to begin. So I'm calling you for help. Okay. How much insurance settlement will you get from the REC? $120,000 is coming with the first settlement. Your phone's breaking up. Can you speak directly into it, please?

Yes, 120,000 is coming from the first settlement. Okay. Is that all? There is a second settlement that will be happening towards the end of October, but we don't know what that amount will be. The gentleman was working for a large corporation, so the insurance policy is very large. I have a head injury, and I can no longer return to a professional level, which I

was. I was in administration. And so with that being, I've lost the capability of working, so my lawyer is thinking it's going to be upwards in the million-dollar range. Wow. Okay. And what did you use to earn? I was at $40,000 a year. My husband, I guess it doesn't matter, but I was at the $40,000. Mm-hmm.

Okay. All right. Is anyone else injured, or they are now recovering to the best possibility. They were only three and six. So they still have ongoing issues, but as far as their long-term prognosis, it's really good. Thank God. Yeah, amen. Well, the reason I asked is that we need to set aside money for that care, your care or their care first. Sure.

Before we do anything. Then secondly, we've got to think about the household has lost $40,000 worth of income, and how are we going to offset that? There's two ways you can offset that. One is to use the money to reduce debt so your expenses are going down, like you could pay off your mortgage as an example, and that'd be a big help out of a million dollars. How much is your mortgage? We, our total debt, including our mortgage, our truck, all of our loans, is only $100,000. Okay. All right.

Then that kind of becomes a no-brainer. I'd write a check and pay off the $100,000. What does your husband make a year? $70,000. Okay. Sorry. And, you know, then we've got his income and no debt, and then you use the rest of the money. I'm talking about after we've set aside enough for your care.

Any ongoing surgeries or care, we set that aside first. Secondly, I'd pay off all the debt. Third, I would invest it and let the investments create income that offsets the fact that you lost your income. And that is a big question mark. I'm a dummy when it comes to investing. We've never been in a position to be able to do any investing, to even think about investing. So I have no idea where to even start with that here's a couple of rules and if you follow these two rules you'll be okay

well three rules okay number one rule go slow you don't have to be a genius overnight okay number two rule do not put money in anything until and unless you understand it. Not because I said to, not because some guy in his good suit said to. It's your money. You're the one that's going to be affected. It's your responsibility. It's your life. Do not put money in something unless you can call me up and tell me how that investment works.

Meaning you understand it. Okay? Got it. Because if you understand it and you're making the decision, you won't worry and you won't make mistakes. Not many. Okay? Okay. Third is you need someone in your corner to help advise you on this.

Now, the mistake that most people make when they pick an advisor is they pick someone to do the work for them. I don't want them to do that. I want them to teach you and you make the decision. You are the one that's responsible. I'm not responsible for your million dollars. That advisor shouldn't be responsible for the million dollars. You are responsible. And so take your time. Don't put money in something you don't understand. And meet with someone who can increase your understanding. An advisor that has the heart of a teacher, not the heart of a salesman.

Sure. Okay. Let me tell you, when I'm meeting with a young NFL star, a young football star, and I'm trying to explain to him that NFL stands for not for long, you know, he's not going to be there very long, and he should take advantage of the time while he's there. And let me tell you, if he says this phrase to me, I know he's going to leave the league broke.

And the phrase they say to me sometimes is, I got me a man. Translation, I'm turning all of the responsibility and the understanding of my investments over to someone, and I have no freaking clue. That is the definition of a young man getting ready to lose all his money. You follow me? I got you. And you're going to be just exactly the opposite of that. You're going to be going slow. You're're going to be just exactly the opposite of that.

You're going to be going slow. You're meeting with someone that has the heart of a teacher, and you're not going to invest in it until you understand it. Once you're doing all of that, I would lead you towards understanding mutual funds and how they work and what they are, and I would invest in four types of growth stock mutual funds. I know I would do that because it is what I have done. And it's growth, growth and income, aggressive growth, and international.

And I pick mutual funds that have a very long track record. I do not invest in a mutual fund that's been open two years or three years. I invest in them that have been open 10 or 20 or 30 or 40. I have one mutual fund that's been open 75 years. And I can tell the average of what it's done for 75 years. That gives me a lot of comfort. If that thing has performed at X rate for 75 years, I'm pretty comfortable with that. And then I don't have to freak out when I turn on the news. And Trump burped on twitter

and the stock market went sideways i'm not freaked out about that i'm gonna ride this thing out he's been this this thing's been around 75 years it has endured republicans and democrats for 75 years it's made money. So I can just be calm. I can ride with that thing. But I understand it. And the more understanding I have, the more peace I will have around it. Financial peace.

It's about being content where you are. And it's about understanding your investments or don't put money in them. And let me just tell you, too, I'll go on another sidebar on this. You know, you're asking all the right questions, Nicole. So click SmartVestor at DaveRamsey.com. You can find the SmartVestor pros we recommend. They don't work for me, but these are qualified investing professionals that are near you that we have vetted and they have the heart of a teacher and they'll go heart of a teacher and

they'll go slow with you and you take your time and you understand it and get someone with the heart of a teacher and you're going to be just fine i'm sorry you've been through this horrible wreck kiddo but it sounds like you've got some fun coming ahead of you here this is the dave ramsey show I'm glad I'm here. This is The Dave Ramsey Show. Hey, guys. This is Blake Thompson, senior executive producer of The Dave Ramsey Show. Did you know over 15 million people listen to The Dave Ramsey Show every week? And a lot of those people listen to one of over 600 radio stations across the country.

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