The Ramsey Show - App - Our 19-Year-Old Isn't Following Our Rules (Hour 2)

Episode Date: November 26, 2020

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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'm Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. Anthony O'Neill, Ramsey Personality, number one bestselling author, is my co-host today here on the air. Again, the number, if you want to talk, 888-825-5225. Starting off this hour is Jose in San Diego.

Hi, Jose. How are you? Hey, I'm doing good. How are you doing? Better than we deserve. What's up? So kind of to explain my situation, I'm 20 years old. I don't pay any rent. I live with my parents. I'm working two full-time jobs, making about $3,800 a month. I only pay about $500 in bills, and I'm kind of stuck into what to do next. I don't know if to pay off my car or save up more money. I'm just wondering what would you guys do in my position? How much do you have a car?

How much are you paying a month for your car? I pay $192 a month. How much are you paying a month for your car? I pay $192 a month. How much is on the car? Plus $200 insurance. How much do you owe on the car? I owe $8,000. Okay. All right.

And then how much do you have in your bank account right now, in your savings? I have $5,700. $5,700. Okay. All5,700. Okay. All right. So there's two things that I'm seeing here, Jose, is one, you're living at home and you're not paying any rent at 20. I'm not too, too upset with that, but I am having some concerns that you're not trying to really start practicing how to become a young man. And then the other part of it is you're making $3,500 a month

and you have a car note. So if you're going to be at home living with parents, you know, without no bills, you should be 100% debt free and building towards that. So the very first thing I'm doing with my money

is I'm paying off all of my debt. That's the very first thing. No issues, no ifs,'m paying off all of my debt. That's the very first thing. No issues, no ifs, ands, or buts about it. Because you're in a position that a lot of 20-year-olds are not in. So that's the very first thing, pay off your debt. But where you are career-wise now, is this where you're going to be at for the next four or five years? Is this a career destination for you? No.

So I got the second job because I dropped out of college because my college turned into online only. And I'm planning to come back when it's on campus. And for now, I just want to save money until school comes back. And that's my plan. Great. What are you going to study? What are you studying in school? I want to save money until school comes back, and that's my plan. Great. What are you going to study? What are you studying in school? I want to do nursing.

Good for you. Okay. So here's your goal. Anthony's right. Knock the car out and pile up cash to pay for college. Yep. Pretty simple goal. Okay.

How big a pile of cash can you possibly get to go to college? As big as you possibly can have. I'd love for you to have $100, big as you possibly can have i want you i'd love for you to have a hundred thousand dollars piled up absolutely and you can do that easily depending on when you go back and how long you work and all that but i mean first first next two months you're gonna pay off the car yeah then after that you can put four thousand bucks three thousand bucks aside that's forty thousand dollars a year yeah and uh you you can have a pretty stinking good pile of money and pay cash for college when you go back.

I think that's, and you get a nursing degree, and it's paid for in cash, and all the while you were driving a paid-for car. Ding, ding. Life is good. Now, Dave, as a father, and I could be wrong here because I'm not a parent, so I'm asking a father. 20 years old, are you charging me rent kind of when i went back home my dad said hey i'm not going to charge you a lot but you're going to give me something to stay here yeah well i mean you had a little bit of a different story i did so he's bringing you back in after he kicked you out yes and so he's setting a tone with that and i might have done

that exact same thing okay in that setting now so so, but like Denise stayed with us for three months after college before she got set up in her new apartment. We didn't charge her. Got you. But the rent was that she's going to be on a budget. She's going to live under our rules, under our roof. And she's going to pile up some money to get ready to move into that rental. Okay. And so behaving in an adult way that has a good trajectory is good enough rent for me.

Gotcha. Gotcha. But this young man here, I would let him stay there rent-free. Absolutely. Knock that car out, pile up, pay cash for nursing. That's a good – this kid's going somewhere. Yes. He's a sharp young man.

Yes. I agree. You know? Now, if it looks like he's camping out, I'm going to make it uncomfortable by starting to charge him rent, right? Right. I'm going to make it too comfortable around here. Yeah. So, because we do want you to leave.

Yeah. You know, I love the old picture, the analogy, and it is a fabulous one. The eagle builds a nest out of thorns. Out of thorns, yeah. From the thorn bush, long thorns, like three, four-inch big thorns. And when they build the nest, they point the thorns into the nest. And then they fill the nest with down so that it's perfectly comfortable and the thorns aren't touching anybody and the little baby eagles are born.

And then as they grow, the mother eagle starts pulling the stuff out. Because she was. And it gets progressively uncomfortable to stay in the nest. Because when you jump out of an eagle nest, it's on the side of a cliff. You have not flown yet. You have two choices, splat or fly. And so it has to be uncomfortable to want to leave in that situation. Yes.

Right? Yes. Now, I'm not suggesting you splat your kids. That's not my point. Right. But this idea that it's comfortable and protected from predators as it should be, and then as they become young eagles, you start pulling that stuff out and you make it progressively uncomfortable until they make the leap and they spread their wings. I love it. Because an eagle that does not leave the nest is later known as a turkey.

I agree. I agree. And I ask that question, Dave, because when you look at the student loan situation, we look at the demise of today's millennials. I don't think it's just a student loan crisis or it's the demise of today's millennials i don't think it's just a student loan crisis or as all our millennials i think it's a parenting issue yeah yeah and so it's like i think you have a lot of parents hey you're 30 years old you're 35 years old you can stay here and not have any kind of responsibility so that's why i want to get i think that's a different thing than a 21 year old or an 18 year old or i mean if you got an

18 year old and they're going to live at home and they go to college debt-free because they don't have a dorm bill, hey, all day long I'm not charging them rent. I want them to do that, yes, sir. So, again, they're engaging in something, though, that is good for their future, so we're helping them in a different way. So the purpose for charging rent, as far as I'm concerned, is the pulling out of the down to make it progressively uncomfortable. Yes.

But if we need someone to stay comfortable to get the goal accomplished, then I can let them sit there for a little bit. Yeah. And you know what my dad did with that money? Yeah, I moved out. He gave it back to me. Yeah. That's the guy that that guy is.

He's a great, he's a world-class dad. I was so upset. I was like, I could have kept the money. He said, you would have spent it. Well, there you go. But, I mean, a lot of parents do that. I was so upset. I was like, I could have kept the money. He said, you would have spent it. Well, there you go. But I mean, a lot of parents do that. That's not unusual to say, you're going to pay me this, and then they gift it back to them later.

But they wanted them to get the habit of paying rent. And as you said, as a young man to start stepping into your manhood, you start taking on your own bills. Yes, sir. But in this case, we're going somewhere with what Jose's doing, and I think he's got a great trajectory. Brilliant.

So, very well done. All righty, this is The Dave Ramsey Show. You know, so many people have such a negative attitude about life insurance when it's actually one of the most caring and giving things that you can do. Still, 7 out of 10 families either have no life insurance or they don't have enough. I don't get it. Look around. People die at all ages. I know it's sad, but that's reality.

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Go to zander.com or call 800-356-4282. 800-356 here on the air. I am Dave Ramsey, your host. Open phones at 888-825-5225. Matthew is in Oklahoma City. Hey, Matthew, how are you? I'm doing good, Dave. How are you? Better than I deserve.

How can I help? So, my dad passed away here three weeks ago. Oh, my goodness. What happened? Yeah. He died of cancer, liver failure, and kidney failure. Oh man. How old was he?

He was 59. Oh young. Oh my goodness. I'm so sorry. Tough times. He left me an inheritance of roughly $72,000. Okay. Wow. And I just got started in Financial Peace University here about three weeks ago.

Okay. Right about the time, huh? Right around the time it happened. So he had been sick for a while, huh? He'd been sick for about a year and a half. Yeah. So sorry. Well, so what's your plan? My plan is to pay off all my debt, buy a single wide trailer, and move into it, and then try and make sure I don't

lose the rest of it. Okay. How much debt do you have? In debt right now, with the payoff on my car, which I just bid with Zane last night, was like $12,075 for the car, $300 on a new phone, and $300 to my roommate. Okay. So like $13,000 makes you debt-free? Right.

Yes, sir. All right. Which leaves us about $60,000 to work with. Does that sound right? Yes, sir. How old are you? I am 28. Okay.

Well, I like the get out of debt part of the plan. I don't like the single wide trailer part of the plan. Yeah, me too. You want to know why? Yes, sir. Because that is going to go down in value. Right. Instead of up in value.

You said you're 28? Yes, sir. Okay. All right. Why said you're 28? Yes, sir. Okay. All right. Why would you not buy a home? I've been looking around, and most of the homes that I'm seeing are $100,000 or more. Are you working right now, Matthew? I work for a subcontracted company through Amazon called Southern Star,

and I deliver Amazon packages to customers around the state. Okay. Well, I'm with you paying off the debt down to $60,000. From there, I would start to wonder what your career goals are, and do we need to spend some of this money getting tooled up to go be what Matthew wants to be when he's 49, because I suspect it's not driving that same truck. Right. Yeah, that's the other thing I discussed with Zane last night was I eventually

want to franchise out a Papa John's close to where I live and I've done the research on that and the money required for that's about 150,000 roughly and in order for me to do that I'm also wanting to go to college for business management. Okay. Well, let's take the first step, and let's spend some of that money on college. Yeah. And just stay a renter if you want to stay a renter until you get your career up and going, if you want to wait to buy a little bit.

But let's spend some money on that and just rent something inexpensively. But, no, I would not put money in something that's going down in value like a single wide. What are you thinking, Anthony? What are you hearing? I'm thinking the exact same thing. And Matthew, I really want you to hear what Dave said. Spend some time investing into yourself. The number one thing you can do, especially with an inheritance check, is to be wise with

it. How does it benefit you in the long run? How do you be a good steward of that? I love the fact that if you go into maybe a community college at first, just get your feet back into the college game so that way you're not spending a lot of money and then transfer to a four-year

university. Then after that, I heard you say you want to eventually buy something as far as in buying a business. I like that as a young person, but start small, start growing, and then from there we can go ahead and look into big goals. Yeah. Set this up to where you're not going to set the money aside in an investment where you're not going to be touching it. I'd sit down with one of the SmartVestor pros. I'd park 10 grand for education in an account and just a money market account. I'd park 10 grand for an emergency

fund over in an account, and I'd set the other $40,000 aside for an investment and let that be growing while you're going to school. And, you know, I think that'll get you there. And, you know, let's get the career up and running and then decide what you're going to do. By then, it may or may not be a Papa John's franchise. You may want to open your own thing with the money that the $40,000 grows into. I mean, you can open a pretty fine pizza place if you watch what you're doing. So, very cool. Good for you. Very well done. Dave, I wonder, for someone in their 20s who is

debt-free, who has a fully funded emergency fund, would you recommend them looking into a Papa John's-like franchise? I get that question asked to me a lot. And I'm kind of like 50-50. Well, if you pay cash for it. Okay. But I wouldn't open a business with that. No, no, no. Absolutely not.

But he doesn't have the money to do the Papa John's franchise. Right. Just like he doesn't have the money to pay cash for a house at this stage of the game. Right. And someone who has zero business experience, and you go from delivering Amazon packages to running a business and running a whole pizza operation papa john's does a good job training their new owners but that's a pretty high risk play okay i would want to take some baby steps in between there get my feet wet in business

and he's very wise to say he wants to get some classes under his belt on how to run a business i'd love to just have him manage a papa john's for a while. Okay. And just get in there and run one. Go run one for somebody else. Yeah. And meanwhile, continue to pile up your cash and pile up your cash, and then someday become a franchisee. There's nothing wrong with that idea. We're going to pay cash for it.

And I would take some interim steps between delivering packages for Amazon and becoming a business owner. Oh, man. I hope millennials are hearing you because, you know, that's what millennials want in today. They want to be the owner. Well, I don't care if you're the owner, but don't start something of that scale. Yes.

Start something out of your living room. Yes. Okay. And off your card table like I started this business that way, right? And so, yeah, the thing is where you can crash in business faster than anything is when you don't know what you don't know. Got you. And there's a lot of things about running a $2 billion business that I don't know. Yeah, yeah.

I don't know. And I don't know what I don't know. But going from our business is about $250 million a year, okay, and going from that to a $5 billion business in one jump, I couldn't, I would mess it up because I don't know what I don't know. There's a different skill set level required than what I have today to make that leap. And you can just shave off some zeros and it's still the same thing. So if you, you know, you start something in your living room, you screw it up, you stub your toe, it's $10,000. You start a $200,000 franchise cold, and you don't know what the flip you're doing, and you stub your toe, it's a $200,000 wound. Mistake. Yeah.

Okay? And so you do the incremental steps because, you know, and by the way, when I started this business, I didn't know how to run a $250 million business. So I did the incremental steps as the business has grown, or as I've grown, the business has grown. Yes. As I've gotten better and more sophisticated, more knowledgeable in leadership, business acumen, and so on, strategic thought, whatever, then I've been able to run a larger and larger and more multilayered business than when it was me selling books out of the trunk of my car and running a counseling operation out of my living room. Yes.

You know, and so there's no shame. We got a big sign out here. It says, don't despise small beginnings. Yes, sir. Because, you know, but then, you know, take the next step up and the next step up and the next step up. But when you try to reach past your abilities, you pretty much ensure you're going to get your nose bloodied.

You're going to crash. Yes. And so, you know, we don't put a six-year-old into the NFL. Nope. You know, that's what we're talking about. And so you grow physically, you grow in stature, you grow in skill, you grow in speed, you grow in everything, and then you're in the NFL. But it's not like we go from there to there.

So good. It's just some wisdom in the incremental growth. Yes, sir. This is The Dave Ramsey Show. We'll be right back. Our co-host today here on the air, Ramsey personality, number one best-selling author, Anthony O'Neill. Joining me as we take your questions at 888-825-5225. Ray is in Syracuse, New York. Ray, your question for Anthony and me, and I, whatever it is. Hi, Dave.

I'm recently retired, 65 years old, and I got a couple of so-called savings accounts, and I'm not sure if that's where I should have my money. I have $30,000 in the credit union. I have $25,000 that I accumulated from my small retirement that I didn't need when I was working. And it's in the bank, but it's, I think it's called like a two-year money market thing, and it's not making much money.

Nope. And my question is, it adds up to $55,000. Is that where my money should be? And my second question is, I have an IRA account that is worth right now $96,000, which adds up to I have $151,000. Right now I'm living in $2,000 a month Social Security small pension, but I may make a move down the road into a HUD, H-U-D, apartment. What do you think about what I have and where I may be going?

Okay. Very cool. Well, Ray, we teach, and Anthony and I both live, that there are two things you can do with money in this regard. One is save it, which you've done a good job, and the other is invest it. So the portion that is saved is for things you need to do soon. For instance, you would need an emergency fund out of this money that equals three to six months of expenses. I doubt that's $30,000. The $25,000 is not invested.

It's parked in a bad savings account. Needs to be invested. The $96,000, you need to know what it's invested in and make sure it's invested in good things. And so I would say, what is three to six months of expenses for you? It sounds like it's probably $6,000 to $15,000, somewhere in there. So you could set $12,000 of that $30,000 aside, call that your emergency fund. If you need money for something else, set that aside. Beyond that, I'm going to probably sit down with Smart Investor Pro with the balance of that $30,000, that $25,000, and even the $96,000 IRA, Anthony, and try to get them all invested in some good mutual funds.

Absolutely, Dave. I was literally just about to say that. And so the $6,000 to $15,000 that you were talking about, Dave, that's okay to part that in a money market account. Exactly. You know, that's fine. But the other part, you definitely want to sit down with a smart investor pro and even ask them, what are some other ways I can invest with his social security he does have coming

in to kind of help speed up the process? Because of his age bracket, there are some backdoors he can get around to invest a little bit more. Yeah, absolutely. There's a lot of things you can do there now here's the thing it let's just say you had 150 000 and you made two percent on it um that'd be three thousand bucks yeah or if you made ten percent on it you'd make 15 000,000. I'm going with $15,000. So this is probably a $1,000 a month swing, a $12,000 a month swing between saving it and investing it in good mutual funds. Now, here's the trick, Ray. Just in talking to you, this is probably your first trip down this particular path. So it's okay to go slow.

Your job is not to do what I say or Anthony says or what a smart investor pro says. Your job is to learn enough about the mutual funds that you get comfortable with it and you decide whether you want to invest your money in X, Y, or Z. If I woke up in your shoes, I'm 60, I'm right near you. I would, and my personal mutual funds are invested across four types. My investments are that, growth, growth and income, aggressive growth, and international, across long track records, and mine are in IRAs and 401Ks and other investments as well, just straight up mutual funds. So your job here is to kind of go to class, in a sense.

And it's not that intimidating. These people are there to help you. They have the heart of a teacher. Click SmartVestor at DaveRamsey.com. It'll drop down a list of the SmartVestor pros in your area. You choose which one you want to sit down with, with the heart of a teacher. You learn from them how this works, and then you make the decision on what you're going to do but when the story's over if you did it the way we said do it that's what we would do and that's what i personally

have done what anthony has personally done as well we pretty much have savings for near-term things if we're getting ready to buy a car or couch or christmas yeah you have savings for uh emergency fund and everything else is invested everything Everything. Because I don't want to make 2% when I should be making 10 or 12. Yes. Aubrey is with us in Phoenix. Hi, Aubrey. Welcome to the Dave Ramsey Show. Hi, Dave.

Thanks so much for taking my call. Sure. How can we help? I have a 19-year-old daughter that has had a lot of personality changes lately. We help her a lot. She lives at home, and we supply a lot of her finances. She does have a job. We pay for her cell phone, medical expenses, food, car expenses, school, books, things like that. She pays for most of her auto insurance and gas. She has a boyfriend. She's had for like nine months.

They're in love and infatuated with each other. She recently came home and said that she was going to go on a trip with him out of state and stay in a hotel together. We said, absolutely not. That's not okay and not what we believe. And she has said, well, I'm an adult, and I get to make my own decisions, so we're going to go.

Anthony told his dad that one time. He told your dad that one time. What happened when you told your dad that? I didn't come back home. You ended up living in your car. Living in my car, yeah. Yeah, it didn't go very well with us either. I said if that is how it's going to go, there's going to be some significant changes financially.

There's going to be an address change. Yeah. Well, I guess that's why I'm calling you to to gain your guidance of whether we're on the right track so my thought was uh she needs to get a new cell phone plan no no longer piggybacking on us she needs to find her own auto insurance um she needs to move out she needs to move out yeah you don't stay under my roof unless you go by my rules yeah and new cell phone plan aubrey she's already making the money so that's not she's not going to really feel that pain okay so she'll take over that right now what i think and i'm not

a father so i'll let dave speak into this more often but one thing i do appreciate about my father is he made it very clear. You're going to respect the rules of this house. The moment you break those rules, you can go do you, but you're going to do you outside of my house. That's not mean. Why do you have that belief? Because you believe it's what's best for her. It's not affecting you if she sleeps around.

Right. It's affecting her. Right. And you love her, and you're smart enough to know this is not a good plan. Yeah. And so you're just saying, darling, this is not a good plan, and we love you too much to endorse your stupidity. And let me tell you this much.

Doing that, okay, when she she turns 29 when she turns 35 she's going to really appreciate you for staying true and helping her become wiser because at the age of 36 my father is my main guy because he kicked me out of the house because i didn't want to listen that grew me up a lot quicker now Now everything my father tells me, well, I don't do 100% of everything he tells me, but I sure do listen to his wisdom and his guidance because my father, I know he loves me and he wants the best for me. But if you keep letting her get away with these kind of things, she's never going to grow and mature into the woman that she can be.

And by the way, when she made this announcement, she knew it wasn't going to go well. Yeah. Yeah. Yeah. It wasn't like you just sprung a new set of rules on her. She was raised a certain way, and she knew she was going perpendicular to that. Right? Right. Yeah.

So it's very, very hard, darling. Very, very hard to set boundaries. It's very, very hard to set boundaries it's very very hard to love people well it's much easier to be a wuss and just let people do whatever they want to themselves while you pay the bill it's easier in the short term in the long term their lives get destroyed and so i'm not gonna go with it i'm gonna be the big girl the big daddy the big mommy and say sweetie you can't live here if you do that you gotta've got to move. You've got to pay all your own bills. Go be you.

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It's usually $89.99. This is a stay-at-home deal. It is, and it's a great deal. Sold because I'm in it. Well, it's all about humility. No, honestly, I spent a lot of time with the team here, Dave, just really, really fine-tuning it, and not just making it educational, but entertaining as well. So this young person will actually enjoy it.

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We talk to reputable real estate people in your area. We're going to walk you through this whole thing. Go to DaveRamsey.com and we can help you walk through the whole process right now in a crazy, crazy real estate world. Ansley's with us in Athens, Georgia. Hi, Ansley. How are you? Hey, Dave. Hey, Anthony.

Thank you all for taking my call. Sure. What's up? Well, I just actually finished reading Total Money Makeover about an hour ago, and throughout the book, one thing that kept speaking to me was that we paid, or we financed, I'm sorry, more car than we should have. So I have a 2020 Suburban that we got back in April, and we owe $64,000 on it. So throughout the book, that was one thing that just kept popping in. I said, we got to get rid of this car.

So this past weekend, we went to a couple different dealerships. One said, I don't want your car. And the other one wanted me to take a $10,000 loss in order for them to take my car. So I'm at a loss as to what to do in order to take this big chunk out of our debt. What do you owe on it? $64,000 currently. Okay. And what's the market value if you looked it up on KBB? They told me about $56,000 with it being in excellent condition since we've only had it for a few months.

Is that trade-in or is that private sale? Yeah, that's trade-in. That was trade-in. Yeah, that means they're going to make the money on it. Right. Okay. If you sell this car to an individual, you can probably get out of it. Yeah.

Okay. But that's a hard, that's an expensive car to sell to an individual. Yep. Very difficult car to sell. $64,000 car loan. Yeah, we have four kids. I can't breathe. We need a separate gig. I can't breathe. We need it to be big.

I can't breathe. I know, I know. We should have read Total Money Maker a few months ago, but I just discovered it, and now we're here, and, you know, we can't. What is your household income? We bring home about $9,500 a month. Jeez. Yeah, you need to sell it.

Yeah. You don't have to panic, and you don't have to give it away, but you do need to sell it. Okay. It was an unreasonable purchase in your situation, and that's being kind. It is. I get that. And so, but I mean, it may take you a while. You're either going to take a $10,000 loss by selling it to a dealer at wholesale,

or you're going to take a while to sell it and, you know, get the use of it during that time. And how much other debt have you guys got, not counting your home? Total, it's $164,000. What's the other $100,000? We owe $32,000 on my husband's truck. We have just over $55,000 in student loans and then a few small credit cards. So almost $100,000 in car payments. Yes.

Wow. You owe more on your cars than car payments. Yes. Wow. You owe more on your cars than you make. Yeah. Oh, my God. That's rough. But here's the thing, Ashley, Ansley. You just joined the family. So welcome to the family.

Thank you. I'm just crying with you. Yeah. We both are. I know. Here's what I would do if I was in your situation. I will put that car up. And then what I would try and do, because every time you drive that car, the value is going to go down.

If you are going to sell that car, which we are suggesting that you do, I would try and figure out how you all can keep the miles low on that. And then I would say, you know what, husband, we need to take a 5000 minimum loss. We may have to take the 10010,000. And give yourself a time frame. So if the car's not sold by this date, we're just going to take the loss. One month. Yeah. Give it a month. Put it up for sale.

See if you can move it for a month. After that, you need to take the loss. You've got such a big mess. You've got to move on this. What's his truck worth? I think they said $30,000. About what he owes on it? Yeah.

I'd put it up for sale, too. Yeah. Okay. Yeah, you guys have a car mess. You need to buy two $5,000 cars and get back to reality. Okay. And they make $5,000 cars that'll carry four kids. It's just a big van, okay?

Just get you a big old cheap van and buckle them in and go. You're going to feel like you've lost 300 pounds. I mean, you're just being – their car payments are $2,000 a month. It really is. Now, Dave, you know the listeners out there are saying Dave just told them to sell both their cars and go get $5,000 cars. Yeah. What's wrong with that? Nothing at all.

Good. But I would ask you this, because I know people are thinking, well, Dave, at what point can I get a nice car? When you can pay cash and when the total of your vehicles equals less than half your annual income. They have one car. Yeah. Both of their cars are almost, one's over half their annual income, one's almost half their annual income they have one car yeah that both of their cars are almost one's over half their annual income one's almost half their annual income right and so you know his truck is out of line yeah you know if you're gonna have two cars and you make 90 two cars equaling 45 that's

a couple of twenty thousand dollar cars that you pay cash for neither one of these cars are that yeah and if he's gonna drive drive a $30,000 truck, that means she's going to be driving a $5,000 car the rest of her life until they get their income up. Because you don't need to spend more than half your annual income on things with motors and wheels, because they all go down in value. You're not going to become wealthy doing that.

And I'm not preaching at her i'm just saying in general answer your question yeah because she's she's had the discovery but now it's gonna now comes the pain yeah and because it's a dramatic shift from a 64 000 2020 suburban i know to a hoopty yeah i felt everyone listening right now oh my gosh well but you know what you should be oh my oh, my gosh, the other way. Yeah. How scared I am for her. Absolutely.

And her family. I don't know how in the crud they qualified for the loan. Yeah. I mean, what was the car dealer smoking? I don't know. I don't know either. $64,000 at this interest rate right now. That's easy.

A $1,200, $1,300 car note payment. Oh, it's more than that. Okay. All right. Back to the norm, Dave. Back to the norm. So here's the thing. I'm a car guy.

I like cars. Me too. I like things with motors in them. I like things with wheels. I, you know, I like things that go fast with motors in them. There you go. However, if you do math, they all suck. Yes.

Now, I own several, and they suck. Yeah. Because they just simply go down in value. Yeah. There is no... Gosh. Yeah. They're not an investment. They just simply go down in value. There is no... They're not an investment. They're an expense.

The largest thing we buy that goes down in value. And Americans, we're just car people. We love our cars. And they kill you financially. So you have to limit the damage. This is the Dave Ramsey Show. This is James Childs, producer of the Dave Ramsey Show. On your smart speaker, you can add our skill by saying,

Alexa, open the Ramsey Network skill. From there, you can listen to all our shows, ask Dave money questions like, how do I invest my money, or what is the debt snowball? Find out more at daveramsey.com slash smart speaker.