The Ramsey Show - App - Nonworking Spouses Need Equal Say in the Budget (Hour 2)

Episode Date: April 25, 2019

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🎵 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 am Dave Ramsey, your host. You jump in, we'll talk about your life, your money. It's a free call at 888-825-5225. 888-825-5225. John starts off this hour in Illinois.

Hey, John, welcome to the Dave Ramsey Show. Hi, Dave. Thanks for talking to me. Sure. What's up? So in November, my wife is going to be going from 40 hours to 20 hours. In the last couple of years, we've managed to pay off all our unnecessary debt but our house, and then we got $45,000 left on two credit cards, $1,000 on one and about $3,500 on another. We currently have about one month of emergency funds. Wait a minute, $4,500 or $4,500? Oh, I said that wrong, $4,500.

Okay, all right. You gave me the right numbers. Yep, sorry. That's okay. And we currently have only about one month emergency fund saved up i wanted to know with her still currently uh both of us full-time combined we make about a hundred thousand a year um should we chew off the last of that credit card debt or should i work on getting three months or more emergency fund built up before she goes to part-time which do you think

i should do first why is she going to part-time in december uh she's going to go to part-time because uh currently our children have to do before and after school care and she wants to be home with the kids when they get home from school i got it so why isn't she doing that in september uh because the position at the hospital for her to go part-time isn't going to be open until then. Oh, okay. That makes sense. Okay, good. And how much do you make? I make currently about $52,000 a year. So about half of it's her, so you're going to lose about 25% of your income.

Yes, sir. Okay. You're going to go from $100,000 down to about $75,000. Yes, sir. Okay. You're going to go from $100 down to about $75. Yes, sir. And so you're making about $8,300 a month. You should be taking home $6,800 or so. Does that sound right? Yeah, that sounds about right. Okay. From now until Christmas, and you can't pay off $4,500 and save some money?

I guess that's a good point. We don't hold money on cars or anything. Yeah. So, I mean, get yourself on a really tight written budget that both of you are in agreement on. This is a good move for your family. She wants to do it. I agree with the move. Let's do it with wisdom, and that has three parts to it.

One, you clear off the debt. Two, you build the emergency fund that you called to ask about both of those things and the third thing is you guys need to practice living on 75 okay so if you can live on 75 that frees up enough money between now and christmas which is what you got to live on anyway starting in january that frees up enough money between now and Christmas to do the other two things we're talking about. Okay, makes sense. So if you'll practice living on 75, because if you don't practice doing that, you're going to have a problem in January.

Good point. So let's just kind of set your budget up as if she was already part-time, throw all the balance at the credit cards and then at savings, and you'll be there. You don't want to try to build savings to cover the fact that she took a cut in income. The fact that she took a cut in income is just going to slow down some of your other goals, but your emergency fund is not to cover overspending. Anything over $75,000 a year is going to be overspending starting in January.

It's a good move. You're doing the right thing. Let's just do it with wisdom. Too many times people keep living at the level they used to live at after they make a good family decision to cut back on hours. And you can't keep living like that. You have to cut back on your lifestyle to go with the cut back in hours. But it's a good tradeoff. Ernesto is with us in Houston, Texas.

Hi, Ernesto. How are you? Good, good, sir. How are you? Good, good, sir. How are you doing? Better than I deserve. How can I help? Listen, sir, I have a question for you in regards to my wife and her starting to work. She's been working in school as a sub for about the last three or four years,

and she's been doing such a good job that here recently she received a full-time offer as an aide. We've been together for about 10 years, and I've been the primary source of income in our household for that time. And here, we're getting close to reaching one of our goals, which is to pay off our house. We don't have any debt with our vehicles. We don't have any debt on credit cards, nothing. And I'm seeing that I've been kind of waiting on her to approach me to say, can I contribute something? Can I help you with a bill or even maintenance on a vehicle?

And I haven't seen that she's done that. So I'm trying to find a way to kind of approach her and see if we can reach this goal together because by my calculations, if everything I've done up until this point is correct, we should have enough money to pay our house off within the next year. But if she were to help me out... Wait a minute. Let's stop a second. Y'all aren't roommates.

No. You're stop a second. Y'all aren't roommates. No. You're husband and wife. So she doesn't need to approach you and offer to pay part of the bills. We need to sit down and look at our household income, and we need to decide what our household goals are. She has a vote. You have a vote. I think you have a good plan, but it needs to be her plan too but you don't have your money she's got her money when you walk down the aisle the preacher said and now you are one in the old vows and the old vows in the

book of common prayer it said not only for richer for for poorer, in sickness and in health. It said unto thee all my worldly goods I pledge. You are now one. And so it's not two separate people anymore. It's one household income. An example is this. My wife has not earned an income outside the house in 34 years. And yet the bazillion bank accounts that we have she's on all of them when we discuss our money that i earned it's our money all of it the decision she has an equal vote

an equal say um unequal influence and that's the thing dave and i'm with you 100 it's uh it's the fact that she i really i'm honestly i don't know how much money she's made uh in in her in her job because she has a separate account well that's that needs to stop it needs to stop yeah not because you're an overbearing jerk uh but if it was a lady calling me and her husband said it i would say that needs to stop it's not not a man woman thing it's a we thing when you're married you're french we we and you guys need to you need to work on that so it's an opportunity for you guys to grow after 10 years of marriage in your relationship this is an area that's been lacking let me tell you how important this is. It's very

important in your relationships because it forces you to make decisions together, number one. Number two, all the data points that we have on people who build wealth, there are very few of them, like almost zero percent, who are able to build wealth without their spouses pulling with them, making decisions with them. You don't drag along someone. You don't run two separate lives. And, you know, we're roommates. We're a joint venture. We're not a marriage.

I don't see any of those people building wealth. You can do it if one of them is just extremely passive, but it's just toxic. Work together. This is the Dave Ramsey Show. One Dental is a company I've been telling my listeners about because I know these guys will save you money at the dentist. One Dental is a dental savings program that allows you to go to one of over 158,000 dental practice locations nationwide and save on things like cleanings, dentures, root canals,

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We're in a lot of other positions, too, but certainly developers are top of the list right now. Kimberly is with us in San Francisco. Welcome to the Dave Ramsey Show, Kimberly. Hi, Dave. Hey, what's up? I have a question about whether I should sell a rental property that I own. Mm-hmm. For planning for my retirement, I'm 52 now, and I have a 401K. I own the house that I live in, and I'm just looking for what my best move is right now.

Okay. Why would you not keep the rental property as part of what you want to do for retirement? You don't like it? It's not doing well? You don't like being a landlord? What's your motivation? My motivation is to pay down the house that I currently live in that I just purchased at the end of 2017. Ah, okay.

So what do you owe on that house? My current house or the rental or this? Your current house, the one you just bought. I owe $475,000. And how much could you pay down on it if you sold the rental? About $275,000. Oh, that's substantial. Yeah, okay.

I'll leave you $200,000 left to go, and you're 52, and your income's what? $125,000. Okay, all right. Well, the goal here is this. You need to be debt-free, house and everything, by the time you get to 65 or whatever day it is you call retirement. Okay? Okay. house and everything by the time you get to 65 or whatever day it is you call retirement okay and so whatever you do needs to take you to that if you're going to stay in that house that you just bought at retirement are you i plan to yes yeah okay because here's the thing having a house payment in retirement destabilizes your retirement plan and it offsets everything you've been doing up to this

point so having that paid for stabilizes everything you're you're done i mean you got a place to live and it's not going to do anything but go up in value in the san francisco market you're going to be in great shape right and so um yeah i'm going to work to have that done by the time you hit a retirement age and so you know we got 10 12 years we got to have that done by the time you hit a retirement age. And so, you know, we've got 10, 12 years. We've got to knock that out. It's $200,000 or $475,000, making $125,000. So a pretty big bite to do if you don't sell the rental house. So that being the primary goal to knock out your house by then,

and, of course, be between now and then you know really piling up your 401k and getting it as big as you can get it and your you know your roth IRAs those kinds of things so yeah I probably am selling it because the goal of you owning your home free and clear is a better goal than you owning rental property if I have to choose between the two? Okay, so I have another question on my 401k and my pension. So I have a 401k that I've been building up, and I also have a pension that I can either take with a, it converted over to where I can either take with a it converted over to where i can either take uh 2200 a month or a lump sum when i retire of 305 000 you always take a lump sum okay and the reason is this when you die it dies with you if you don't when you die you got an305,000 in your estate, or you have zero.

That's a bunch. Okay? The second thing is you can take the $305,000 at retirement, roll it into an IRA with no taxes, into good growth stock mutual funds, and get a better rate of return than the rate that the $2,200 is calculated at. Because $2,200 is $28,000 a year on 305. And so you can run the numbers out on that. It's about a 7% rate of return.

And you can do better than that. And you'd roll your 401k to an IRA as well when you retire. But take your lump sum because you can make more while you're alive and, and you'd roll your 401K to an IRA as well when you leave, when you retire. But take your lump sum because you can make more while you're alive and more when you're dead. And almost all pensions are running at a 6% or 7% calculation. And, you know, most of them are stable, but some of them are crap. Some of them are not stable. They're not even safe.

And so you've got to consider that, too. Everybody acts like they're ironclad or something. They're not ironclad. But some of them are. Some of them are solid. I'm not trying to panic everybody about your pension, but you make more while you're alive and more if you're dead, if you think about it that way. Fran is with us in Topeka, Kansas. Hey, Fran, welcome to the Dave Ramsey Show.

Thank you, sir, so very much for taking my phone call. Sure, what's up? Okay, so my question to you today is, I'm 47 years of age. My husband will be 49 this summer. And we are about a little hair under $70,000 in debt. Our taxes last year came back. We made around $90,000.

We have a mutual fund that has about a little over $38,000 in it. And we've been toying with taking that money and throwing it at this debt. But it's really hard to swallow. So I just kind of wanted to get your thoughts on that. Yeah. Well, you've already spent the money. Yeah. When you move the money from the mutual fund onto the debt, you just admit it.

You know, if it was going to be hard, it should have been hard before you spent that other money. And that would have been your answer. So what kind of debt is the $70,000 um so we currently have uh two vehicles that are just under 10 and then the rest is student loan okay cool all right so here's what we teach we teach a process of laying a foundation so that you can build wealth aggressively okay Okay? Right. The foundation is called the Baby Steps. And you save $1,000 first, which you've already done. Miniature starter emergency fund. Do you have any other money that's not retirement in addition to this $38,000 laying around like a savings account or anything?

No. That's it? You don't have any money in your checking account to mount anything? No. Okay. Because I've been trying to pay off our vehicles. Good. Okay. All right. So once you've got your $1,000, then trying to pay off our vehicles. Good. Okay. All right.

So once you've got your $1,000, then we list all of our debts. That's the $70,000, smallest to largest, and this is called Baby Step 2, and what we call the debt snowball. And you attack them in that order, minimum payments on everything but the little one, and you attack the little one with a vengeance. And what you do in that process is you temporarily temporarily temporarily temporarily stop any investing so that you squeeze every dollar out of your life and throw out these debts to clear these debts up as fast as possible and any non-retirement savings you would liquidate

and throw out these debts anything you can do except cashing out your iras or 401ks and stop adding to them you would do but you wouldn't cash them out but everything up to that anything you can do except cashing out your IRAs or 401Ks and stop adding to them you would do. But you wouldn't cash them out. But everything up to that, anything we can get our hands on. We're going to have a garage sale. We're going to sell so much stuff the kids think they're next. We're not going on vacation. We're not going to be eating out.

We're cleaning up this freaking debt because it's destroying our lives. We make $90,000 a year and we have no money. Right. And when you get when you get that kind of attitude going and you get that head bobbing a little bit like that and it's like i am freaking tired of this that's when you'll get out of debt and in that case you're quickly going to cash that 38 000 out and throw it at this now let's run the math a second okay that's gonna leave you 22 000 in debt you make 90 you $22,000 in debt. You make $90,000. You should be debt-free in a year.

You'll be debt-free in a year. Then you go to baby step three, and you build your emergency fund of three to six months of expenses. Then you start saving and investing 15% of your income into retirement. That's baby step four. And kids' college is next, and five, and then six as we start paying off the house early. So the fact that you're going to get there this time makes it easier to use this money. But if you're not going to play all the way through that, don't use this money and keep spending like you've been spending.

You need to change some stuff around your house, kiddo. Hold on. We're going to send you a copy of the book, The Total Money Makeover, and show you what to do. We'll walk with you. I'm here to help you. This is the Dave Ramsey Show. Do you know who is a prime target for identity theft?

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And it's the only plan I provide to my team. Zander.com or 800-356-4282 In the lobby of Ramsey Solutions, Roy and Claudia are with us. Hey, guys, how are you? Hi, Dave. Hey, Dave. Welcome, welcome. Where do you guys live? We live in Little Elm texas north of

dallas oh cool well good to have you in nashville and all the way up here to do your debt free scream yes sir yes how much have you paid off we paid off 115 000 love it and how long did this take about 20 months good for you and your range of income during that time it was about 100 000 to 135 000 cool what do y'all do for a living i'm a project manager in a construction company And your range of income during that time? It was about $100,000 to $135,000. Cool. What do you all do for a living? I'm a project manager in a construction company. And I'm a quality control, quality assurance in the same construction company.

Got it. Cool. What kind of debt was the 115? Oh, man. It was about $45,000 in credit cards. It was two cars, and the rest was student loans yeah so yeah cool how long have y'all been married about eight years almost eight years okay so what happened 20 months ago um we just came back from disney i paid off with credit cards of course celebrating

my our daughter's first birthday and um i just i saw all her credit cards were maxed out, and I was just getting frustrated, and it just got sick and tired of being sick and tired. And one of my friends, shout out to Esther, one of my co-workers, she introduced me to your name, and I started doing research, and also every day while I was driving to work, I would see your billboard, and I was wondering who that was, right?

So I started doing more research and found Financial Peace University, and that's when I started, I tried to convince him to join. Yeah, I gave her a lot of pushback at first. She was really adamant on taking the Financial Peace University. And I was, you know, I gave it a shot. And the first class that we took was just, it wasn't up to par from what I expected. And my wife, being as stubborn as she is, she said, no, we're going to take another financial peace university. And the second one really turned my life around.

Wow. Yeah. Well, the instructor in the first one wasn't really into it either. So we weren't impressed until we went to another church and I kept on looking for the right one. We found a really good one. And that's when he came on board. Yeah. I had an issue of also eating out a lot. So it's, yeah. So it got to the

point where Claudia got a three foot by five foot big whiteboard and put all of our debt on that whiteboard and put it right next to the TV. So I would see that. Uh-oh. So every time I would come in from work and I would see that debt and then I wouldn't see any of the squares being filled up on the debt and I would tell her what's going on. And she's like, we haven't paid anything off.

So I was like, okay, we got to do something different then. Yeah. Okay. That helped him. Having a visual do something different then. Yeah. Okay. That helped him. Having a visual is a good thing. Yes. Okay, cool. So once both of you plug in, both of you are on board, both of you get in a class where it's taught properly, then boom, it takes off.

Yeah. Yeah. Well done. What do you tell people the key to getting out of debt is? I think to me it's getting your spouse on board. Because we tried for the first few months, tried budgeting, and we would always go over. But just as soon as he got on board, that was it. Yeah, mainly the communication part of it. And just really on my side is visually seeing the debt and seeing how much it was affecting us emotionally and financially.

So, Roy, there's a lot of people call me over the years and they say, well, I can't get my husband on board. I can't get my husband on board. What did Claudia do or what should a wife do or not do, for that matter, to get you to plug in? Because once you plugged in, man, you're game on, and it was zoom, zoom, right? Yeah, that's right. So what got me on board was, well, really, my wife is a trooper, so when she's set on something, she's really 100 100 150 percent did that and uh she really just kind of guided me

on our financial peace so i couldn't say no to her because i love her so much and uh it's it's mainly love you know i'd do I love her so much. And it's mainly love. You know, I'd do anything for her. So the more she showed me visually, the more I changed. Got it. Okay, cool. That's a good answer. Very good answer.

Thank you. Very good. Cool. So outside of the two of you, who was your biggest cheerleader? We had a lot of cheerleaders, actually. Our families were, even though they're not following the plan exactly, they do, every time we accomplished paying off a credit card, they would cheer with us.

Yay, good. Yeah, some of our coworkers, too. My coworker that introduced me to you, she kept on pushing. She paid off her house. Wow. So, yeah, she kept on pushing, and so we had a lot of support. That's good. Good.

Way to go, you two. We're proud of you. Thank you. How does it feel? You don't have any debt. Oh, man. It feels great. Have you ever been debt-free since you got married before now? No.

No. No. Eight years, right? Yes. Wow. Look at you. Look at you. And you brought your daughter with you and what is her

name and age let's get her in the picture daniella she's three years old daniella is three years old okay so she gets she's been involved in all of this yes actually um my claudia put a video of her and uh dave ramsey community uh Facebook page every day. She was doing the debt-free scream. She's coming down. Oh, she's been doing it. She's been practicing the debt-free scream. Yeah, she does the debt-free scream every morning.

I love it. All right, Danielle, you get to do the real thing now. You ready, mama? Let's do the debt-free scream. Ready? Ready. All right. Here we go.

$115,000 paid off in 20 months, making $100,000 to $135,000. It's Roy, Claudia, and Daniela. Count it down. Let's hear a debt-free scream. All right. Three, two, one. We're debt-free! Woo!

That is how it's done. Absolutely fabulous. Woo-hoo! I love it's done. Absolutely fabulous. Woo-hoo! I love it, man. I love it. Very well done, you guys. Very well done. We've got a copy of Chris Hogan's book for you, Everyday Millionaires.

That's the next chapter in your story. So, Kat, we'll take care of you and get that for you out there in the lobby. So, thanks for participating with us. And congratulations. You're on your way. I love it. That's excellent stuff. Very well done.

Stephanie is on Twitter. Dave, would you recommend putting money for Baby Step 3B into investments to ramp it up a bit? No. Most investments, for instance, mutual funds, if you don't leave it alone at least five years, you're taking a pretty high risk that you're going to lose some money. And so in Baby Step 3B, meaning you're saving for the down payment on your house, and the only money you have to your name is your emergency fund plus this money.

So you don't have a ton of money. You can't afford to lose, you know, 10% of it or 20% of it because the market turns down on you. And I invest in the stock market. I love the stock market. I've gotten good returns. But the only way you do that is you ride it for the long haul. Mutual funds are not a good place to park money on the short term

because they lose money as much as they make money in a given year. And you just don't – it's the up and down, the back and forth. Over time, you make really good money, but that time is at least five years. So I would just use a simple money market account, get as much interest as you can get, but you're not going to make any interest on this. It's just going to be a couple years. I mean, if you save $30,000 and you made an extra 10%, it's only $3,000. It does not change the house you buy. And so it's mathematically frustrating to watch it make nothing in a bank savings account

or a 1% money market account or whatever. But it's just, you know, I wouldn't take the risk of losing the money for the money, a little bit of money that you'd actually make in this short period of time by investing it. So good question there, Stephanie. We appreciate you following me on Twitter. This is The Dave Ramsey Show. Thank you. Allie is in Green Bay, Wisconsin. Hi, Allie. Welcome to the Dave Ramsey Show.

Hi, Dave. Thanks for taking my call. Sure. What's up? So my question for you is what we should do with the money we just made selling our house. So background story a little bit is we are, we have just under $80,000 in debt. Last year we made like 85 and I was on maternity leave for like four and a half months. What will you make in a normal year?

It's going up every year, so it's kind of hard to predict, but I don't work that much. This coming year, this coming 12 months, what will you make? Probably closer to $90,000. Okay. And what kind of debt is your $80,000? It is a lot of medical debt and a lot of student loan debt how much of its student loan debt student loan is 26 how much of its car car is car is about 20. Two different cars.

Two different cars. Okay. All right. And how much is credit cards? Nine. Okay. And how much did you get from the sale of your home? About 40.

Okay. All right. And your question is what? Your question is what? Is do we, okay, so the tricky part of it is the reason we sold our house is because my mom recently passed away and my dad wanted to sell us his house. So we sold ours and it sold super quick, way faster than we thought it would. So we moved out of ours and we're renting from my dad right now. We ideally would like to buy this house.

He doesn't really want us to rent too much longer. So we were saving that $40,000, and we're on baby step two, so we're just working our butts off paying that debt down. But we have this $40,000 sitting in our bank account. So what is this house worth? What are you supposed to pay for it? His house is worth $250,000, but he's going to sell it to us for $190,000. Okay, that's nice.

And if you put $40,000 down, is there any reason you can't close on it now? No, nope. Okay. He's only charging us $500 a month for rent. Yeah, but he doesn't want to do that. What was your... Yeah. What was your other house worth?

Well, we got a really good deal on it. What did it sell for? It sold for $170,000. Okay. So you're moving up $20,000 in the house. Right. Put it on a 15-year fixed and then keep working your plan put it okay and well that's our thing is like if we put it on a 15 year

it's going to slow down your plan yeah yeah so we just we just do that yeah that or not by this house your choice okay we don't i mean that's better than putting the $40,000 down on our debt and then... You don't have any money to close on this house, and your dad wants to sell the house. Okay. Right. You would lose the house if you put this money down the debt. Well, I mean, I've heard you say you don't have to put 20% down, right? Yeah, but 40 is not 20%. It's 10%. No, it's 20%. I's 20 i'm sorry no it's over isn't it over 20 yeah

yeah put it all down and work your dead snowball all right or just don't do this or just don't do this deal one of the two but i'm okay either way but i mean you you you're you've committed to doing the deal delaying it doesn't change your math much. So just go ahead and do the deal. I mean, I wouldn't have done it. It's not a deal you should have done. You were broke. You shouldn't have been buying a house and moving up.

But you've done the deal. And so the only question is when you're going to close on it. And delaying it for three or four or five, six months or whatever doesn't do it. It doesn't help. Dave is with us in Dallas, Texas. Hi, Dave. Welcome to the Dave Ramsey Show. Hey, Dave.

Thanks for taking my call. It's a pleasure to speak with you today. You too. What's up? Well, so we've been in the envelope system for quite some time, cash for everything, and then we use our debit card for certain points of sale items like gas purchases and grocery store purchases occasionally, but usually it's cash. But in the last three years, we've had my wife's debit card information stolen

and used against, you know, racked up all sorts of charges. You're not responsible for those. Wait a minute. You're not responsible for those charges. You're absolutely right. And the bank always gives us the money back. It's not a huge deal, but it's an inconvenience. It is with a credit card, too.

Right. That's true. The difference is we've been using our debit card to pay our electric bill, our water bill, the utilities and such. And we're just kind of curious what you do that protects your identity going to, like, a gas pump. Do you have, like, a paying advance-like debit card that if it loses its $100 on it that it's no big deal so you don't have to keep redoing your bill? No, I have two debit cards personally and I

have one on the business and they all three get replaced probably three times a year due to a fraud algorithm kicking in. The same thing happens with credit cards these days. They don't make it a year, hardly any of them anymore. If your bank's got

a good fraud algorithm, it's picking up somewhere that somebody's picked up your information somehow and is misusing it. My wife has the best algorithm for us. She's able to catch most of this stuff before it becomes too big of a deal. And the bank catches it and shuts it down often. If they see an unusual set of charges, if you've got a decent bank, they're calling. I mean, they're shutting it down often if they see an unusual set of charges if you've got a decent bank they're they're calling i mean they're shutting it down i mean i got a call the other day are you are you in mexico city and i went nope you know and uh guess and so guess what i'm getting a new

debit card this week uh and you know i want it's a pain in the butt because on recurring things, you have to jump in and reset your number on anything. I was afraid that maybe we were doing something wrong with our debit card. We just live in a very filthy, toxic world where identity theft and card theft is just an ongoing. People spend their entire lives just trying to steal. And it's just the world we live in today. The good news is you're not liable under a debit card and you're not liable under a credit card according to zero liability policy. And so what you end up doing after a while, once you get past your baby step two,

is you end up just keeping a little extra money in your account so you can, you know, you got a little extra money in your account uh so you can you know you got a little extra wiggle room if some of this garbage happens and you know it takes them a day or two to put it back or something you're not completely starving to death you know in the interim so you can't run things down to zero uh i do run zander identity theft but i've never had to activate it on one of these things because the bank has always just put the money back when we dispute the charge. And they do it within a day or two usually. It's nothing, you know, nothing to panic about, nothing to freak out about.

But they don't do it in one hour. And if you keep zero in there, you could, you know, you can get run into overdraft on something. So you need to, you know, have a little pad in your life. And then the debit card works just like a credit card does in that regard as far as having the same protections. But Xander, identity theft is essential these days. The other thing I've done, to answer your question, is since I don't borrow money many, many years ago, as soon as they allowed it, I froze my credit bureau. And I froze Sharon's, and I froze the kids. The kids were minors then i went and

froze everybody's and uh i think all of them are still frozen i don't know they're adults i'm pretty sure they're frozen and borrow money i do know that but um uh you know so if if your account is frozen it doesn't help with somebody stealing your number and hacking a debit card or hacking a credit card that's not doesn't affect that um but it does keep your number and hacking a debit card or hacking a credit card. That doesn't affect that. But it does keep your identity because help a little bit with some forms of identity theft. And so that way, because if somebody goes to try to get a loan approved and pull a copy of your credit, they find it frozen. They're going to go, oh, Dave didn't make this application apparently. And then, again, Zander Insurance, very inexpensive coverage to have full identity theft coverage that assigns a caseworker to you to do all the work to straighten everything up

in the event there's a massive fraud or a different kind of fraud than you and I were talking about. So, I mean, they can work on those kinds, but you usually just call the bank and take care of it. So, hey, thanks for the call. We appreciate you joining us. That puts this hour of the Dave Ramsey Show in the books. Our thanks to James Childs, our producer, and Kelly Daniel, our associate producer and phone screener. I am Dave Ramsey, your host, and we'll be back. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show.

If you would like to do your debt-free scream live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.