The Ramsey Show - App - NEVER Finance a Tank of Gas! (Hour 2)

Episode Date: March 25, 2022

George Kamel discusses: High gas prices and why buy now, pay later companies are swooping in and trying to screw you at the pump, Dealing with $180k in student loans, What to do with unexpected money, How much to contribute to an HSA. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

🎵 Live from the headquarters of Ramsey Solutions, this is The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm George Campbell, Ramsey personality and host of the Fine Print and Entree Leadership Podcast, all of which you can find on the Ramsey Network. Open phones this hour. The phone number to call is 888-825-5225. David is kicking us off in Tulsa, Oklahoma. David, welcome to The Ramsey Show.

Hey, George. Good afternoon. Thank you for taking my call. Absolutely. How can I help? Well, we just came into just a little bit of money recently. I'd say a little bit of money, about $9,000. And we are looking at, would it be wise to invest the $9,000 straight into the principal of our house? We currently have a mortgage with $120,000. Outside of the mortgage, we are debt-free. And looking at if we should do that or invest into maybe a Roth IRA or maintain the funds within the savings account,

reason I'm being cautious about it is we've got one vehicle with roughly 120,000 miles on it, and the second one is about 250,000 miles. Both of them kind of have their issues as well as maintenance and stuff but we're just kind of looking at how we can keep this down. We haven't been invested, we're at the I guess baby step three and we haven't been putting the max towards our retirement as we could, mainly because it kind of puts us on a crunch financially every month, I would think. It sounds like you're doing multiple baby steps at once. You said you're investing, but you don't have the emergency fund in place?

Right. We have the emergency fund in place. So our estimated emergency fund would be about $14,000 for six months. We do live pretty tight. But we also have a savings of about $40,000 right now. What's that for? It's just sitting in the bank, and that's why I haven't been investing that in a Roth or anything like that. I think that's probably the next step we need to take. Hold on. So you said you're in Baby Step 3, but you're telling me you have a fully funded emergency fund? I have a fully funded emergency fund, yes. So you're in Baby Step 4.

We did the $1,000. Okay. We did the $1,000. We paid off all of our debts, no school loans, anything like that. No car loans, nothing? No car loans. Okay. We just simply have our mortgage at 120.

Okay. And you're not quite investing 15% of your gross income into retirement. Correct. We're about at 8% right now. How come? Do you not have the money? Mainly, so my, right, I make about $60,000 a year, and my wife had recently kind of stepped away for maternity leave, so that really kind of impacts our finances a little bit there, and I just, I like having that comfort of having it in the bank, I guess, where I really should be just investing it to the max.

But mainly the cars have me a little bit paranoid in what we should do there because I know we've got two children, both very young, and it concerns me maybe getting out on the road and then something breaking down. Sure. So it sounds like we've got to focus on one thing at a time. And right now we can't invest the 15% because it's tough.

You also have these cars over here that are on their way out. And so we tell people to have sinking funds. You know, your car breaking down when it has 250,000 miles, that's not really an emergency because you can kind of see that one coming from a mile away. So what I would do if I'm you guys, you're saying you have $40,000 in savings on top of the $14,000 emergency fund, and you have $9,000 that just showed up. No, sir. Let me correct that. So we have $40,000 total. Including the $9,000. Within that, yeah.

Okay. Well, I'm going to set aside some of that $40,000 to get these cars upgraded. So I'd be selling those if If maybe the 250 one for now, sell that one and get something reasonable. Okay. Which in this car market is... It would be a reasonable number. Yeah, exactly. I would get something as cheap as possible

that gets the job done. This is A to B. This is not us trying to look flashy because like you said, you don't have enough margin to even be doing baby step four, let alone paying down the house. So we have some...

We got an issue here with our budget, our expenses, our income that we've got to take care of. So I would probably look for a $10,000 car, not quite a beater, but not quite something that's going to turn heads at the stoplight. Okay. And beyond that, I want you to get to that 15%. If that means fully funding a Roth IRA for this year with some of that money, I'm okay with that. But we have to figure out long-term solution for this. And I don't want you just sitting on a pile of money because it makes you feel good. I want it working for you. And that means continuing on with the baby steps, saving for college, paying off the house early. And you and your wife should have a talk about what that looks like beyond maternity

leave. Is she going back to work? Is she going to stay home? Yeah, no. She's actually started back up now. So before the maternity leave, she would be working on the weekends. Not full time. She'd be staying at home with the kids. We've not really looked at pricing out any kind of daycare, you know, babysitting kind of thing.

What percentage is the mortgage taken up of your take-home pay? We're right at just under a grand as far as the mortgage. And what's your take-home pay? $60,000. Your take-home pay is $60,000? Oh, I'm sorry. No, that's my gross. Okay, so it's probably closer to four grand a month that ends up in your bank account? Right. Okay. So the mortgage isn't

killing you guys. I'm just trying to find out where all the money's going because generally when people pay off debt and they have an emergency fund, they can find the room to invest that 15% without crushing them. And I know you guys, you have kids, there's some crazy expenses, inflation. It's a strange time right now, so I don't want to define your life by these numbers. Certainly. But we need to look at how can we trim expenses. I would go do a budget audit. Go through every insurance premium you have. I'd be shopping around through Zander to see if we can get a

better deal elsewhere. I'm going to look at how much we're eating out. I'm going to tighten it up. Are you guys on a written plan and tracking it every month? We were following it pretty good. Lately, it has kind of stepped away. We kind of enjoyed our getting out just a little bit from being tied in with all the COVID and everything. So I would think we probably spend maybe $30 maybe every two weeks on eating out. So we'll just kind of stop in and get a little lunch somewhere.

Well, I can hear the kids in the background. They seem real sweet. But that's the only way to create that margin is we're going to trim expenses and we're going to bring in more income. And so figure out what that looks like. This money needs to be put to use. I would upgrade one of the cars for now. And if the emergency hits where the other one goes out, that's what the emergency fund is for, but I would create a sinking fund

where you can put aside some extra car savings money through your cash flowed income, and try to get to that 15% as soon as you can. Yeah, one thing we were looking at is with the valuation of cars, so as far as her vehicle, it's the one with the 250. But the body, everything seems great on it outside of the engine and transmission. Not really had any issue yet, but you just know it's coming. So my father, recently my father had a newer engine placed in his Tundra. And when that happened, I mean, it's just like, almost like buying a brand new car again.

So I kind of looked at that a little bit because then we're not going to be out investing in a brand, you know, like new car. Sure. Well, I would not go putting a new engine in that car. I would just go ahead and get something used. You guys have the money to do it. It's not worth messing with this thing anymore. Get rid of it.

This is The Ramsey Show. At 25, I thought I was hot stuff, but I was actually a hot mess. The good news is the dumb mistakes you make in the past do not determine your future. Your decisions today do. After going bankrupt, I set out to learn the right way of managing money, and I developed the Ramsey Baby Steps. Now, after three decades of guiding millions of others through the Baby Steps, it's clear this proven plan works.

Right now, my number one bundle, the starter special, is 70% off and has everything you need to get rid of debt and plan for your future. In this bundle, you'll get our best-selling book, The Total Money Makeover, Rachel Cruz's newest bestseller, Know Yourself, Know Your Money, and her new money assessment, plus so much more. If you want to get out of debt, build wealth, set your children up for success, and plan for retirement, here's where you start. So order the starter special while it's 70% off at RamseySolutions.com. That's Ramsey Show. I'm George Camel, Ramsey personality and host of the Fine Print Podcast.

Well, folks, if you drive a normal car like normal people, you've had to get gas like normal people, and you've probably been very angry at the pump. Here in our neck of the woods, gas is running about $4.30 right now, which is about double what it was, it feels like, six months ago. And to add insult to injury, the buy now, pay later companies are screwing everyone over because here's the new news out this week. You can now buy now, pay later for gas. That's right. You can now have the pleasure of paying for gas that you

bought three weeks ago. This is sad stuff. And Klarna and Zip, they have partnered with gas stations to provide this. Texaco and Chevron gas stations have the option to split up your payment into four payments over six weeks. So we like to joke that you can do buy now pay later on a $10 item and make $2.50 payments for four months. And now you can do that with a gallon of gas or 10 gallons of gas. And we just released our Ramsey Research State of Personal Finance Annual Report. And Buy Now, Pay Later has exploded in popularity, especially with the younger generations. Nearly one in four people made a purchase using a Buy Now, Pay Later service in 2021. And millennials are leading the charge. Four in 10 millennials made an online purchase with Buy Now, Pay Later service in 2021. And millennials are leading the charge.

Four in 10 millennials made an online purchase with Buy Now, Pay Later compared to just 18% of Gen X and just 4% of baby boomers. And if you know anything about Buy Now, Pay Later, it's just a modern marketing version of installment plans. So when you go add to cart right below that, it looks like you can get 75% off by splitting it up into four payments. And the companies are making a lot of money on this. The retailers are making so much money on this. And it's not just the interest and fees they can get you with. The bigger issue I have with it is the overspending. In fact, Klarna, on their website, they are bragging to retailers that customers spend 45% more on the average store order when they use a buy now, pay later service.

So at least they're self-aware that they're screwing you. I guess that's a good sign. Don't do this. Don't pay for gas that you bought three weeks ago. When you are paying for the past, you can't build for the future. So I know times are tough. I know gas is insane. I know housing is insane. I know car prices are insane. So what can we do about this? Well, we can control the controllables and we can still pay cash for things. And it might mean more patience. It might mean more sacrifice. It

might mean we're cutting a subscription. We're not eating out as much. We're meal prepping. We're eating at a new restaurant called Mi Casa. That's right. We're going to eat at our house, if you don't know Basic Spanish 101 there. So this is sad to see, and I want you guys to stay away from the buy now, pay later schemes. I want you to delay your purchases, be a wise spender, stick to your budget. And if you want to learn more about Buy Now, Pay Later, we did an entire episode on this on season one of The Fine Print. You can find that wherever you listen to podcasts. And it's called Afterpay Affirm Klarna, Should You Buy Now or Pay Later? You can go check that out wherever you listen to podcasts. All right, let's go to the phones this hour. You can call us at 888-825-5225. Anna joins us in NYC.

Anna, welcome to the show. Hi, how are you? Good, how are you? I'm good. I'm in a bit of a sticky situation. So I have $180,000 worth of student loans, and that's undergrad and grad loans together. And so they're comprised of a few different ones with different percent interests.

And as of May 1st, I'm supposed to start paying them back. And I recently started working, making about $100,000 per year. That's comforting. And I'm not, yeah, so I'm not renting yet, but I'm also moving out of my family's house, which I've been living at since COVID. So that's going to be an expense added on as well. And I'm just very lost in how to handle these loans. I'm not sure if I should refinance or consolidate or do income-based repayment. So I was hoping to get your advice on that.

Yeah. Well, at the end of the day, there's only one way to get rid of debt, and that's to get rid of debt. And so I don't like consolidation and refinance as a shortcut because it's not a shortcut. You're just moving the debt around and feeling like you did something. And so the best thing you can do is use the debt snowball method to attack these debts. Are you familiar with that? A little bit. I think you tackle the,

I forgot if it was the smallest or the largest loan. The smallest. So here's what you're going to do. You're going to ignore the interest rate. And I know that hurts because you're a smart woman and you look at the interest rate and it makes you want to throw up, right? Yeah, it's about 6% right now, which is terrifying. And I was hoping to get that down to 4%, which a lot of these refinancing companies offer, but I don't know if that's the way to go. Well, I mean, it's worth a shot if you want to look at that.

Our friends at Splash Financial, they're good people, and you can check with them to see what you could do. I don't mind it when you can lower the interest rate. I just don't want you to extend the length of the loan. So sometimes what they'll do is they'll go, yeah, we'll give you 4%, but now you're in debt even longer and your payment's higher, and so there's all kinds of things they can do to kind of trick you into thinking that you got a deal. So I would check with Splash, but really at the end of the day, I still want you to do the debt snowball. I don't want you to consolidate this because what happens is it becomes one giant mountain and it's unbearable

versus feeling the progress, freeing up each payment as you pay it off. So what I would do is you can use the debt snowball calculator on our website and you can actually put in all of your debts from smallest to largest regardless of the interest rate. Just ignore that and we're going to start paying off the smallest one with a vengeance. So make minimum payments on all of the other student loans. You can afford to do that, right? Come May 1st? Yeah, I don't know what the payment would be. Because there's a lot of individual loans. There's actually about like 23 to be exact. Yeah. Well, the good news is they're probably all fairly small, especially at the front end.

Yeah, yeah, yeah. There's a few really huge ones ones and then there's a bunch that are about a thousand or a thousand five hundred yeah now when you move out are you going to get a roommate yeah so i already signed a lease actually for may 1st as well um and my expense there will be about 1500 which i'm sure sounds crazy but it's new York, so it's kind of standard. So I don't know even how much I could be paying off while also, you know, living in New York City as well. And I'm not like a big vendor by any means. I'm ready to just like eat rice and beans for a while. Yeah, you're going to continue living like a broke college student because you're broke right now thanks to these student loans.

Now, what kind of work are you doing? I'm a software engineer. Oh, awesome. Well, hopefully your income will continue to go up. Yeah, it's my first software engineering job, so I'm hoping it will obviously only go up from here. Is it remote or is it in the office? It's hybrid. So it's two days remote, three days in the office.

Okay. Well, I know in the software engineer world and that tech world, you can leapfrog when it comes to income and you move to this company and that company and all of a sudden you could be making $200,000, $300,000 in that world. Right. That's definitely the goal. So use that to your advantage as you start this kind of new chapter with a roommate. Live like you're broke.

And if you can do that, I mean, the $1,500 a month is going to eat up a good chunk of your income. But beyond that, if you can throw $60,000, $70,000 at the debt, you can be done with this thing. I want you to be done in two years. Anything beyond that, I'm going, this is just too long years? This is too long if it's going to take five. $180,000 in two years? Well, that's $90,000 a year. Is that possible? That's $90,000 a year.

Obviously, it's not possible with your current income and current living situation. But let's say you worked fully remote and you could move somewhere less expensive or move across the bay or whatever that looks like for you. And you hustled and you did some side hustling with your software engineer skills. You brought in an extra 20K. These are the kind of sacrifices that you're going to have to make if you want to climb out of this hole and you don't want it to be a slog of seven years. And you're still trying to pay off these student loans.

And you're still trying to mess around with consolidation to fix the problem. We got to rip the bandaid off and look at the hard numbers. But I'm telling you, the debt snowball is your best path to do it. You're going to feel the progress, you're going to free up payments along the way. And you're going to see the light at the end of the tunnel. Hang on. And I'm going to have Kelly give you Ramsey plus one year membership to help walk with you along this journey. And you call us back if we can do anything else to help you. Thanks for the call, Anna. Welcome back to The Ramsey Show. I'm Ramsey personality, George Camel.

Open phones this hour, 888-825-5225 is the number to call. Haley joins us now in Destin, Florida. Haley, welcome to the show. Hello. Hey, how you doing? How can I help? Okay, so my question is, my husband and I have about $60,000 in debt, and because of COVID, I'm sure you hear that all the time. We had to repossess out voluntarily, repossess our camper. Um, and then you know how that goes. We have, we owe 23,000 now and don't even have the camper. Um, and also I have a car that we are $10,000, um, with upside down negative equity. Um, so

we have random credit cards. We are on step two trying to do the debt snowball. And we're renting right now in Dustin, Florida for $2,300 a month. What's your income? I personally make about $65,000. And my husband, we're not really sure, maybe $20,000, $30,000. He owns his own landscaping company. It doesn't sound like he's doing too hot if he's making $20,000. No, he works by himself. I think it's more than that, honestly.

This is only his second year. We haven't done our taxes yet to really show how much he's making. Hold on. You don't know how much you're making? He shouldn't be running a business if he doesn't know how much money he makes. Well, QuickBooks says he's making a lot, but we're not really. We're learning. So, yeah.

Well, that's a tough time to learn when you've got all this debt sitting around, but that's a story for another day. So let's say you're making, what, $95K a year? Yeah. And you've got $60K in debt, and we're underwater on a few things here. So how can I help today? Exactly. What is your suggestion?

Like I said, we haven't actually paid on the camper in over a year because my credit is shot, so I was just like, whatever. But we eventually want to have kids. We eventually want to buy a house. So we don't have to be paying the $2,300 a month. So I guess, like, what do we just continue to do? Do we snowball? Like, do you have any advice on repossessions, I guess, like, what do we just continue to do? The debt snowball? Like, do you have any advice on repossessions, I guess?

How much money do you guys have to your name right now that's liquid? Maybe $1,500 right now we have, but we pretty much live paycheck to paycheck. Well, you've got your baby step one. If you set aside $1,000, and then we're going to go to town and this dude better be mowing so many lawns that you forget what he looks like. Yeah. He's got to get this thing coming up. I mean, he was hospitalized with Brad Doe because he was too old.

Oh, my goodness. Well, he needs to charge more or something. Something about this business isn't working out. But aside from that, we want you to do the debt snowball in Baby Step 2. So I would list all of these out, small to largest. If you're $10,000 underwater on this car, how much is left on the loan? $23,000. And you're saying the car is only worth $13,000?

Yes. Are you sure? $13,000 to to 17,000. Yeah, what happened was I had a car, and then I had a warranty call me and said that my car warranty was up, and I fell for it and had to pay $200 extra a month. It was a scam? I know, and then it was a scam.

You were the one person who fell for that call where they say, hey, I'm calling about your car's extended warranty. I know. I was it. Oh. I know, and I cried, actually, when I went to the car dealer, and he was like, the only way to get rid of this warranty because they couldn't find it is to trade in the car. So then I got sold by a car dealer.

Oh, my goodness. And then ended up upside down. Haley, turn your phone off. Turn all phones and screens off. Don't listen to anyone. Don't listen to anyone. Don't talk to anyone. Just work your butt off. No, I don't.

Pay off this debt. I really don't. Well, I mean, 13 to 17 is a big range. I'm going to go and do some really good research. I'm going to check with Carvana and Vroom and dealerships and Facebook Marketplace and see what this car is actually worth. Go to kellybluebook.com. All those sites. Do some really good research to see what you could get for this car.

Because if you can get $17,000, $18,000 and you owe $23,000, the only time I would tell you to go get a loan is when you're underwater on this car and you go to your local credit union and you get a small $5,000 personal loan to get out from underneath this car. Now, that's not a shortcut. It's not a life hack. But what it does is speed up this process and create a $5,000 loan instead of a $23,000 loan today. Yeah. Do you need that vehicle? Do you have other vehicles? My husband has a paid off truck but yes i will i would need a car and it is a hybrid so it's saving me money a lot of money on gas and i live less than two miles from work so i don't really need a that helps i can get a scooter i mean you guys could keep the car and

pay it all off you if you're making 100 and you000 in debt, we can be done with this thing in under two years. So it's reasonable, but I feel like you're so overwhelmed right now. I mean, who cares if you're saving money on gas when you can't breathe because you're living paycheck to paycheck? Yeah, yeah. So I'm going to follow the debt snowball, and I'm going to research this car and figure out if it's worth selling and getting out from this underwater vehicle so that we can speed up this process. But you're going to list your debts from smallest to largest. We're ignoring the interest rate. We're ignoring phone calls from scammers. We're ignoring everyone and everything that's in our way. All distractions are gone. We're not eating out because we're broke. No, no, we don't. We don't need that. Okay. I want you guys to have a house. I want you guys

to have kids and you can have all those things, but right now we have to pay a price to win and it's not going to be fun. The next year and a half of your life is going to be brutal, but man, it's going to set you free if you do this stuff. Yeah. Yeah. We're Christian. So we, we believe in that. The Lord told me it's going to be a clear year, so that's when I'll go, okay, we need to put our boots on the ground and figure this out. Boom. Well, Haley, I appreciate the call. We're cheering you guys on. Okay, thank you so much.

Absolutely. Good stuff. All right, let's move on to Tanner. He's in Johnson City, Tennessee. Tanner, welcome to the show. Hey, George. Thank you for taking my call. Absolutely.

How can I help today? I was just calling to see what your best suggestion is. My wife and I are on baby step six, and we're trying to figure out what's the best amount to contribute to our HSA. Do you guys have a match through work for that? No, not a match through work. Okay. But we do have a high deductible. It's five grand. Okay. Well, I mean, you can a match to work. Okay. But we do have a high deductible. It's five grand.

Okay. Well, I mean, you can save up to the deductible. That's what I would do right now. But obviously, there's going to be a max on that. If you're both involved, are you both on the HSA? Yeah. So, it's max would be seven. Okay. I would not max it out right now until you have that paid for house. That's when I go, okay, now we can have some fun. But I would try to get it to that deductible limit so that in case you had to hit that deductible, you've got the money in your HSA to cover it. How much is in there now? Not much, a couple hundred bucks. Okay. Yeah, I mean, I don't think you need, there's no urgency to fully fund this thing ASAP, but do you guys have the margin to do that, to contribute each month maybe?

Yeah, definitely. On top of paying off the house early? Yeah, we can. We can manage. What's left on the mortgage? $175. Okay, and what's your income? So just shy of $100 for the000. Okay. And what's your income? So just shy of $100,000 for the two of us. Well, that's great, man.

You guys are doing great. And I love that you're using that HSA. As you know, the sweet triple tax benefits of that, not being taxed when you put money in, growing tax-free, and not being taxed when you take it out for medical expenses. Are you guys both pretty healthy? Yeah. Yeah, we're both in our

late 20s. So just trying to prepare ahead of time. Yeah, that's wise. Well, I would work to get that HSA number to your deductible, but I don't think there's any massive urgency. Do you have your emergency fund in place? Yeah. So worst case, we can dip into that if it goes beyond what's in our HSA. But long term, I love having that deductible amount in there. And that's going to give you a whole nother layer of financial peace. And once you pay off that house, a few years from now, let's max that thing out every year. And you can start investing in good growth stock mutual funds in there. And it becomes a really cool retirement vehicle. And that was my next question about investing. So

you guys typically do also? Yeah, yeah, absolutely. I would look at some good growth stock mutual options that you have inside of that account. And once you have a certain buffer in there, you can begin to invest that money. It may look different depending on your HSA, but absolutely. It's a great way to invest. That is tax advantage. Thanks so much for the call, Tanner. This is The Ramsey Show. I'm George Camel, Ramsey personality and host of The Fine Print. If you've been listening to the show for a little while, you probably know about Dr. John Deloney's new book. We're all super pumped about it. It's called Own Your Past, Change Your Future. And what makes it extra cool is that we're partnering with our friends at BetterHelp to give you a month of free one-on-one weekly therapy

when you pre-order a copy. Who does that? That's incredible. You're never too old or too young to improve your health and make your relationship stronger. And this free month of one-on-one weekly therapy is going to help you get the tools that you need to change your future. And what's cool is you'll get matched up with a therapist based on your specific needs. This is a life-changing combo. Dr. John Deloney's Own Your Past, Change Your Future. It's going to make you laugh. It's going to make you cry. It's going to challenge you.. It's going to make you cry. It's going to challenge you. And when you take the steps that he outlines in this book and you take advantage of that free therapy, your life will be transformed.

Just like it is when you follow the baby steps with your money, you can do that for your mental health, for your relationships, and for your wellness. Get those free therapy sessions by pre-ordering Own Your Past, Change Your Future today for just $20 at ramseysolutions.com. Let's go to the phones this hour. They are open. You can give us a call at 888-825-5225. Christine joins us in Rockford, Illinois. Christine, welcome to the show. Hi, George. Can you hear me? Yes, you sound great. How can I help? Good. My boyfriend and I have been talking about marriage, and we'll see our relationship ending in marriage soon. We've started looking at how much weddings cost and are a little overwhelmed by this. We're looking for some advice on how much is appropriate to spend on a wedding

and how much to budget for it. Our finances are both separate and will remain separate until we're married. I'm in baby step four, and he's in baby step six. Awesome. Well, that helps when you're both debt-free. Are you guys paying for this whole wedding, or have you talked to your respective families about it? We'll be paying for it. Okay. Well, I want you to spend as little as possible for a great day. Yeah. That looks different for everyone. I know you've been dreaming about this day since you

were a little girl probably? That's fair. So the biggest parameter is don't spend more than you have in cash, regardless of who's paying for it. There is no official parameter, but I'll tell you some stats here. According to a study from WeddingWire, couples on average spend roughly $28,000 on the ceremony and reception, which equals about $215 a guest. And with the average household income being about $55,000, $60,000, that means most people spend, on average, half of their annual income on a wedding, which personally I think is just too much. Now, what do you guys have in mind for the wedding?

We're looking at spending about $40,000. Oh, do you have a lot of friends? And big family, yes. Oh, boy. Well, I mean, remember what you're doing here. You're just throwing a party for other people at this point. So the question is, when you do the math on $40,000 divided by how many people are attending, look at that and go, all right, is that guy Jeff from college, is he worth $200 to me?

For him to have an open bar and have a great meal? That's the question you got to ask yourself. So I don't want you to let emotion drive these decisions. I want you to remember that this day is about you two. So cull the invite list before it gets out of hand. Have you already made a budget for this? No, we're looking at that now. But you're in your mind, you're going 40 grand feels right. We've kind of broken it down based on averages in our area. Ah. Well, here's the truth. The whole wedding industry is one giant scam.

And so they can charge because people are willing to pay for it. So I want you to really take a good look at this and not get too emotional and excited about what could be because those $3,000 you spent on flowers, they die the next day and the memories will live on. But I would look at the budget and go, okay, do we really need video? Can we just do photo? Do we need the $4,000 wedding photographer or is the $2,000 photographer going to do a great job? Have you talked to your boyfriend about this? Yes. And when do you think he's going to propose? In the next couple of weeks. When do you plan on getting married? Have

you guys talked about a potential date? Probably not until fall of 23 at the earliest. Okay. So you've got some time to save up for this. What is your income? I make about $90,000 a year. Okay. What does he make? And then he makes about $115,000 a year. Okay. And you guys would both be splitting this evenly to pay for the wedding? Yeah. Okay. So you're in for $20,000. He's in for $20,000 at this point if we move forward with this Yeah. Okay. So you're in for 20K, he's in for 20K at this point, if we move forward

with this plan. Correct. And so we need to look at, okay, we're going to create a sinking fund, $20,000 divided by how many months until we're going to have to pay for these expenses. All right, that's going to be, you know, $1,000 a month. Does that sound reasonable to you guys as you talk that part through? It does. Okay. Well, I mean, this is your call. There's no stipulation. If you want to spend the money and you have it, I'm good with that as long as you don't go into debt. But I'm also good with trimming down this budget. And make sure you have a separate checking account just for wedding expenses. Get a separate checking debit card for those wedding expenses so that things don't get too

muddy. Wonderful. Thank you so much, George. Absolutely. Thanks for the call. Congrats on the wedding. Very exciting. Joe is in Chicago. Joe, welcome to The Ramsey Show. Mr. Campbell, thank you so much. It is an honor to talk to you. Oh, you as well. You've got a great voice for radio. Well, thank you very much. I appreciate that. How can I help? Let me give you a little background. I am in Baby Step 4, 5, and 6.

Three years ago, my wife and I were $80,000 in debt, and I am proud to say that between retirement and non-retirement, we are 100,000 plus. Wow. Yes. That's amazing. Way to go. Yes, absolutely. So my question is, when I am continuing this adventure or journey, whatever you want to call it, to become wealthy, how do I continue to stay humble and grounded? That's a great question. Would you consider yourself a person that has humility right now?

Absolutely. What would make that change? Let's say I handed you $100,000 today and a really nice car. Would it make you any less humble? I don't think it would make me any less humble, no. I really don't. So what's the worry there? What's behind this? My worry is that money can change people. But there is one thing in my life that I know keeps me very grounded.

And when she came to me the other night and she asked me, how are we doing? We do the budget together. We do everything together, but she likes, she, she lets me take the reins cause I'm the nerd and she's the dreamer. So when I came to her and I gave her that number of $100,000 sitting between those two accounts, that smile is what's going to keep me humble. I can tell you that right now. Well, that's the thing. There's no amount of money that's going to make you a jerk or not.

We say that money makes you more of who you already are. It's a magnifying glass. And so you don't sound like a big, egotistical, narcissistic jerk who's flashing around his money. And if you had another $100,000, I don't know that you'd turn into that guy either. Now, I do love that you want to make sure you don't end up there because, yeah, you're right. People can change. People can turn into jerks. But if you're watching out for that, you're not doing things to impress people,

I would really check your motive with every single purchase that you make, with every move you're making. Are you driving a flashy car to impress people, or do you just love cars? Are you getting the mansion to impress people, or do you just want it out? That 2005 Dodge Ram is not flashy by no means. So you're not a flashy guy to begin with? No, absolutely not. Are you a person of faith?

Yes, I am. I think that's one of the best ways to keep me grounded. Anytime you think you're something, you know, Dave always says, better than I deserve. Because if you believe in the Bible, you're a man of faith, a Christian, it's hard to really think you're something. You know, even me sitting here hosting the show, there's an entire team of people that it takes to run this show. There are a thousand things that have to happen for me to do what I do.

And so I don't take it for granted at all that I'm just so amazing and I get to be in this seat. And so as long as you keep that mindset of, man, I'm so grateful for what I have. I'm so content. I'm not making purchases out of need to impress people. I just love my life. I've got financial peace, and that's okay. And people will think what they want to think, and that's okay. But if you treat people with dignity, you live by the golden rule,

man, you're going to do just fine. You're going to keep that humility that we all love so much. I appreciate the call, Joe. Appreciate you being debt-free, giving us a call. This show is about you, America, and we're thankful you're listening. That puts this hour of The Ramsey Show in the books. Hey, folks, Ken Coleman here. Did you know The Ramsey Show is one of the most popular podcasts in the world? Get your daily dose of advice on life and money. Check out all of our shows from the Ramsey Network wherever you listen to podcasts.