The Ramsey Show - App - Planning to Care for Aging Parents (Hour 3)

Episode Date: August 29, 2018

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Live from the headquarters of Ramsey Solutions, 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. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. That's 888-825-5225. Andrew's with us in St. Louis. Hey, Andrew, how are you? I'm doing pretty well. How are you today, Dave?

Better than I deserve. What's up? Well, I was calling because I've been employed with a company for close to three years, and when I took the job, part of my compensation package was for what are called RSUs, or restricted stock units. And basically, the way they work is it's over at the four-year vesting period. In a year, you get a quarter of it, and then every quarter after that, you get a quarter of the remaining part of it. So after four years, it'll be fully vested. The stock has done exceptionally well. It's basically octupled, I guess would be the proper term. Wow, wonderful.

Yeah, well, I got in at a good time, that's for sure. So my question is this. My wife and I, we're a single-income household. My wife is disabled. She's had five spinal surgeries. And so we've had a lot of medical debt that we've been taking care of. But my main question is this. We're looking to move after the stock vests because the school district that we're in is, quite frankly, not very good.

My son had a lot of bullying issues. He has autism. So we wanted to get into a better school district, which requires that we get into a better living situation or a better house in a nicer neighborhood. So we wanted to use the RSU money to basically put either, if the stock continues to rise in two years, hopefully, we can just pay the whole, you know, buy it with, you know, with the RSU money. But I wasn't sure what the tax implications were for this, and I wonder if you had any advice for me.

I would get professional tax advice. I think it's just compensation. I think it's ordinary income. Okay. I'm pretty sure it is. I mean, they gave it to you as part of your comp package, so your basis in the stock is zero. I mean, it may qualify for capital gains. I don't know.

But you need to get some tax advice to be sure. But as long as you're out of debt other than that, other than the house, and you have your emergency fund in place, then definitely I would use that money to buy a house with. Well, I was just recently turned on to you by a co-worker at my former second job before I took a recent promotion and quit the second job, which is really dumb in hindsight. But she gave me your book, The Total Money Makeover, and I basically let it sit on a little road trip, an inexpensive little road trip to see some family in Kansas. And I basically read your book during the time that I was there, and it was a revelation to me. So I am basically, I've stripped down my contributions that I was making to my 401K.

I'm in an employee stock purchase plan because I get massive discounts on it. That ends in November. I'm going to turn that off as of November because that's when the current fund. So you've got some debt to clean up is what you're trying to tell me. Yeah, yeah. I've got about $14,000 in credit card debt that we need to pay off. Chop up the cars. Let's get that cleaned up. So when's the stock going to vest? You said you've been in there three years and it's a four-year mark, so you're almost there, right?

Getting there, because I was granted two different batches. One when I first got hired and a second after a yearly compensation. Okay, well, you're on your way. Yeah. So, you know, we're talking about 18 months or something before you get most of this money or all this money or whatever. But, yeah, clean up. Go ahead. While you're waiting on that to vest to make the move, go ahead and clean up everything

else and get yourself up to baby step four. And then, yeah, let's just pile up cash and make this move. And it sounds like, wow, ding, ding, you're going to be able to cash this stuff out, pay cash for a house. That would be incredible. Lee is with us in Raleigh, North Carolina. Hi, Lee. How are you? Hey, Dave.

Thanks for taking my call. Sure. What's up? Well, I kind of feel lost. And I was hoping to get some of your advice and see what I need to maybe start at first. Okay. About six months ago, my husband passed away. Oh, my goodness.

Yeah. And right after he passed, his mother passed away. So, you know, I had to quit my job because it was just a lot on me. And fortunately, he had insurance and I was able to pay the house off. But I haven't come as far as a Social Security check. But I think I'm ready to get another mentality about money, if you will, because he was the saver and I was the spender in the relationship. How old are you? I'm 45.

Okay. Well, one of the mentalities would be getting your second career here. Yeah, and that was where I was at, too, is that I was not in a job that I could see myself long future at, but, you know, it was income coming in. So your house is paid off, and how much of an estate beyond that do you have? Well, he had a savings account and i was i'm not the beneficiary and we had made that decision because i had old credit card debt so he's got a about thirty five

thousand dollars in savings and that we have been you know building up so how much old credit card debt do you have you got about 15 okay and so you could use that and go clear up the old credit card debt which is one thing we want to do did you have any other nest egg other than that no but see i can't touch it because it's um the the kids name are the beneficiary and i have a a child that's under the age of 18 so it's not your money he didn't leave it to you that's correct okay i ask how much money you've got you don't have any other money other than a paid for house house? That's correct. And how are you paying your bills? Well, with the Social Security check.

So, you know, I was going to start back a job, but I guess... You need to. Yeah, I do. I do. I do. So I guess would you recommend me putting our 16-year-old in a class with me? Yes, and I'm going to pay for both. Okay. I want you to go through as my guest on how to handle money. But the trick is here in your situation, you've been through a really tough time, kiddo.

I'm sorry. It's been a bad year. It's been a bad year. How old was your husband? He was 51. Wow. Okay. Young. Okay. Well, yeah, you hold on and we'll get you signed up. But in addition to going through Financial Peace University, Lee, you're going to have to really explore what it is you're going to do with the rest of your life. I mean, you have 50 good years left ahead of you, probably.

40, 50 years. What are you going to do with that? Yeah, there's all kinds of opportunity and things for you to go do. It's your encore. It's the bow you take in the second act. Yeah. This is The Dave Ramsey Show. Okay, I need you to listen to this, because one normal routine that everyone does can cause total chaos in your life. Folks, I'm talking about the simple act of using Wi-Fi. When you're

on Wi-Fi anywhere in public or at home, you're at risk of hackers easily seeing every site you visit and search you're doing online. It doesn't matter if you're doing it on your cell phone or your laptop. I'm not telling you this to scare you. I don't operate in fear, but I want you to be aware and take action. You need to download Hotspot Shield. Hotspot Shield helps keep your connection on your own Wi-Fi and any public Wi-Fi secure. 600 million people worldwide have downloaded Anchor Free's Hotspot Shield. Download it now. My listeners can save even more by going to hotspotshield.com slash Dave. That's hotspotshield.com slash Dave.

You can be secure in seconds. Download Hotspot Shield today. Stopping by the lobby of Ramsey Solutions with a question. Joel and Laura are with us from Tampa, Florida in the lobby. Hey, guys. How are you? Hey, Dave. Hey, how's it going? Pretty good.

Welcome, welcome. Good to have you guys. How can we help? So we were wanting to ask you, how can we prepare better for taking care of our elderly parents? You build wealth. You get your act together because the stronger you, it takes strength. The weak can't help the weak. Only the strong can help the weak.

And so if they're not in, if they're not taking care of their finances to be able to retire with dignity, and you want to be in a position to help others, including them, then you get yourself out of debt, you build wealth, you invest. And so if you're sitting there with a million dollars in your 401K, there's a lot you can do to help somebody, right? Yeah. So there's not a special elderly parent's savings account program. It's just pile up money, and then you've got that to do a lot of things with

and help a lot of people with, and certainly your family would be in the list. But there's not anything that's magical or different about it being in the family. Perfect. Does that make sense? Yeah. We appreciate it. Cool.

Thanks for dropping by, guys. Thanks. God bless. All right, Tyler's in Chicago. Hey, Tyler, how are you? Good. How are you? Better than I deserve. What's up? I just have a question.

I'm 20 years old, and I have a little bit of debt, which will be paid off by Halloween this year. And then I'm looking towards, I don't know what I should do first. I want to buy my own house, but I also want to save for retirement. And so I'm just curious as to which one I should do first, if I should do them both first. I don't know. Are you living at home now? Yes, I am.

Okay. So the first thing I would tell you to do is, once you're clear of the debt, is go ahead and get your own place as a rental. Okay. Estab establish yourself that way make sure you have your emergency fund of three to six months of expenses once you're debt free at that point that's what we call baby step three and and then sometimes people delay starting their retirement for a short period of time, a year or two, that kind of a thing, in order to very, with focused intensity, very quickly build up a good down payment above their emergency fund. Now, you're debt-free, you got your emergency fund. Then before you start retirement, you sort of take a pause break there in the middle and pile up cash for your down payment. And if you did that for a couple, two, three years, that'd be okay,

because you'd still be only 23, 24 years old when you started saving for retirement, and you'll still be wealthy. There's nothing to question about it. So you're well on your way to do that. We call that baby step 3B sometimes, you know, because it's between baby step 3 and baby step 4, in other words. And you temporarily stop the baby steps, you know, in the middle of that between three and four and build up your down payment for a house at that.

But in the meantime, what I would tell you to do, though, is just get you an inexpensive place to rent, maybe some roommates or whatever, establish yourself out there in the marketplace, too. That's not a waste because you're not looking at it as a way of life. You're not going to do it forever and ever. You're just doing it for a short period of time because you're not looking at it as a way of life you're not going to do it forever and ever you're just doing it for a short period of time while you're saving up but you're also establishing yourself emotionally and developmentally uh you know adult wise in the marketplace and that that is very very helpful hey good question thanks for joining us brandon

is next in Columbus, Georgia. Hi, Brandon. How are you? I'm doing good, Dave. How about yourself? Better than I deserve. What's up? Good deal.

I found your program about a month or so ago, and I'm getting kind of fired up about attacking some debt I've built up recently. So I kind of wanted to just bounce my initial plan off of you. I'm 28 years old, like I said, and I went out and bought a house three years or so ago and maybe made the mistake a lot of young people make and bought a house for what the bank told me I could afford. I didn't pay too much, but I kind of had to use credit cards to supplement that income over the last three years. I now make enough where I can probably afford the house better than I could before. So I still want to attack the debt. I'm just wondering what you think.

I've had some expenses go up with a girlfriend moving out recently, so I'm trying to balance it all out. What's your income? I make $50,000 gross. How much credit card debt have you got? $13,000. $13,000. Okay.

Yes, sir. And how much is your house payment? It's $900 a month. Okay. That's manageable. What's your first big step is, Brandon, is you've got to really learn to make every dollar every month behave. And that's called a budget. And that's a new thing to you but when you start doing that jump on every dollar.com and get that going for your app on your phone and and or on your desktop

whichever way you want to do your budget but you need to get that set up and really make those dollars behave when you do you'll feel like you've gotten a raise. You can pay off $13,000 in debt making $55,000 with a $900 house payment. That's very, very doable. Yeah, and I recently got this raise, and it kind of didn't really affect me like I thought it would because all the extra income is going to debt. So I really want to get back to square one and actually bring this money home. I'm wondering if I should maybe sell the house.

No. Do that. No, I think you're fine. The house doesn't sound like it's unreasonable to me. It sounds like it's the thing that you've just not had a plan where you're detailed out making every single dollar behave. And when you do that in writing, it's going to change everything for you. And really start, you know, get that EveryDollar app and get going.

It's free to use, and you can get set up on it, and it changes everything. It really, really does. So, hey, thanks for the call. Appreciate you joining us. Steve's in Greensboro, North Carolina. Hey, Steve, how are you? Hey, good. Thank you for taking my call.

Sure. How can I help? My wife and I are working the baby steps, and I just wondered how you generally tell people to handle the cash value in a whole life insurance policy that's already paid for. I didn't want to get taxed on it by taking it out or something. There's going to be probably no taxes on it. Ninety-something percent of them have no taxes because your basis in it is what you've

paid into it and they suck so bad that it's probably not grown above what you've paid into it so okay if it has you may have a tiny bit of taxes but your basis for tax purposes is all that you paid into it so you go back and add up everything you paid into it and compare that to the cash value it's almost always greater in which case you're taking a. So you go back and add up everything you paid into it and compare that to the cash value. It's almost always greater. In which case, you're taking a loss, but you're not allowed to take a tax loss on a cash value policy. So, again, how long have you had it? It was a 20-year whole life policy, and I paid it off two or three years ago.

Okay. So how much have you put into it? Do you know? It was like $50,000 when I bought it. It wasn't a real expensive one. I mean, you put $50,000 into it? Well, that's what the maturity, you know, that's what they projected. Now, what I'm asking is how much have you written checks to the insurance company for? It was like $40 a month.

For how long? 20 years. You've been doing it for 20 years? No. Yeah. Oh, you have? Yeah, it's paid for. It's done.

Oh, God, no. And the policy's still there. Okay. Well, you're using insurance, whole life insurance verbiage, okay? Life insurance is never paid for. All you do is prepay it. Uh-huh. Okay?

It's never paid for because as long as you're alive there's a chance you're going to die so there's always a cost associated with it you just gave them so much money that they're giving you a free early they're giving you a free policy okay so forty dollars a month um for 20 years right Okay. And that's all you've got in it? Right. Okay. So you've got about $10,000 in it. What's the cash value? I haven't looked at my statement, but I was going to do that if I got off the phone with you.

As long as it's not over $10,000, and I doubt it is, then you're not going to have any taxes. Okay. That's what I'm asking. You just call your insurance guy and say, I want the cash value because that was one of the selling points when he sold it to me. He goes, oh, you can withdraw it. Yeah, well, you can withdraw it, but if you withdraw it, of course, it cancels the policy.

You understand that? Okay. As long as I have term life, I'm good. Exactly. Make sure you've got the proper amount of term life insurance in place first before you cancel a policy. And then, yes, I would cancel that trash and use the money to advance your wealth rather than theirs. This is The Dave Ramsey Show. Let me tell you a story about two families that are very much alike in a lot of ways. Both families have two working parents and a couple of young kids.

Each has debt and has struggled to make ends meet. But they're starting to make headway with their budgets and smarter decisions with money. They have dreams and plans, and the only real difference is that one family has the right amount of term life insurance and the other doesn't. Big difference. If one of the parents die, and that does happen, their well-being would be destroyed. Paying for the mortgage, utilities, food, and other bills would be impossible, let alone saving for education or retirement. That's why every day I talk relentlessly about getting term life insurance. Just go to ZanderInsurance.com or call 800-356-4282

and see how inexpensive it really is. Be the family that takes those deliberate steps to be different and responsible. It really does make you the hero of your story, and it puts you on course for better things ahead. Thanks for joining us, America. We're glad you're here. What if you could help people in your community understand and win with money? You know, if you're passionate about the stuff we teach on this show, then join us.

Help us change lives by leading a Financial Peace University group in your area. Doesn't take a lot of time. It certainly doesn't take any financial training. I do all the teaching. You coordinate and lead the discussions in the group. And we'll guide you through the entire process. Volunteer coordinators work at thousands and thousands of locations all over the nation. That's what makes Financial Peace University work.

Thank you, by the way, if you're a coordinator. We appreciate you. We can help you get started at DaveRamsey.com, or you can text the word LEADER to 33-789. That's text the word LEADER to 33-789. That's text the word LEADER to 33789. Our question of the day comes from Blinds.com. They have a 100% satisfaction guarantee. That means even if you mismeasure, even if you pick the wrong color, they will remake your window blinds for free.

Site-wide savings is happening right now. Plus, take an extra 5% off at blinds.com slash Ramsey. Blinds.com slash Ramsey. Victoria's in Washington, D.C. Dave, I'm in the unique position where I have no debt, no credit score, but no money at the moment either. I have help to get me on my feet and good-looking job prospects. The downside is that I'm currently living in D.C. where things are ungodly expensive. I'm

entering the world with a blank slate. I have no problem living frugally and working hard. How do you suggest I go about getting my financial life set up? My fear is that somehow I will mess myself up financially, and I vowed that since I was little that my financial life set up. My fear is that somehow I will mess myself up financially, and I vowed that since I was little that my parents struggled with money that I never would. Well, it has everything to do with income because you've got no outgo. You live frugally, you know how to manage stuff, and you just need to create an income, and until you get the good-looking job prospects going you take some not so good-looking jobs to eat and keep the wolf away from the door as they say meaning that you

can get your light bill paid and you keep food on the table and you don't run around doing a bunch of stupid stuff with money like running up a bunch of credit card debt all because you're waiting on the job, quote unquote, right? So it's all about jobs, lots of them, until you get this moving. Steven is in Phoenix, Arizona. Hi, Steven. Welcome to the Dave Ramsey Show. Hey, Dave. How are you doing?

Better than I deserve. What's up? Hey, just give me a quick call. First off, I want to say thanks so much for what you do. I've been listening to the show for about a year now, and my wife and I were about a month away from having Baby Step 3 completed. And so my question for you is this. We currently own two homes.

One, our primary residence happens to be immediately next to where I work. I mean, I have no commute. I'm right next door. And the other one is a rental that we currently have renters in. Our mortgage on is about $600 a month, and we get $1,100 a month. We're making about $500 a month there. The reason I'm calling is because of the fact that we bought the primary home with a VA loan before we started listening to you. And recently, we were blessed with our first baby. And so my wife decided to stay home with him. And so that reduced our income from about $105,000 a year to about $70,000 a year. So we're outside.

Right now we still have a 30-year mortgage with the VA loan. And so if we were to refinance it to a 15-year, it would be outside of that window that you suggest of the 25% of our take-home pay going towards housing. So I just wanted to call and get your perspective on, you know, what you would do in our situation. Okay, so your current house payment on your personal residence is more than and get your perspective on what you would do in our situation. Okay, so your current house payment on your personal residence is more than 25% of your take-home pay since your wife came home. If we were to refinance it to, currently no,

but if we were to refinance to a 15-month exit, it would be yes. Okay, all right. Well, no, I wouldn't do that. How much equity is in the rental? About $100,000. And what do you owe on your home? We owe $280,000 on our home. Okay.

Do you like the rental? Yes, I do. It works great. We have great renters. Yes. Okay. Well, just continue to pedal through. I mean, you're on baby steps four, five, six,

and so you're going to just continue to beat on this. And, you know, I'm going to work to get my home paid for, and then I'm going to work to get the rental paid for. Those are long-term things to do. Meantime, of course, you're going to continue your career track, and your income is going to go up. You're probably going to look at refinancing someday down the road. But in the meantime, there's no need to.

You can pay extra on a VA loan. there's no need to you're going to pay you can pay extra on a va loan there's no prohibition to doing that and so you can pay it off as fast as possible but you don't have a lot of wiggle room to do that with other than you know whatever income you can pull off of this rental rental is not making that much money uh five hundred dollars is you know six thousand dollars,000 a year. That's one heating and air system away from losing money in a year. That's, you know, a few months of it being empty, all of a sudden you're not making money.

So you haven't got a lot of spread in this. It sounds like you do when you say, I'll make $500 a month, but you don't really make $500 a month repairs and the vacancy is factored in and other stuff so it's okay to keep that rental uh but i'm i'm not going to defend it like it's you know the best thing going because you haven't got a lot of money coming off of it but if you want to hold on for a little while and just kind of continue to work the plan, see how you turn out, you can always look up and do that later if you want to. Ryan is in Middletown, Ohio. Hi, Ryan.

How are you? Good. How are you? Better than I deserve. What's up? My question is, me and my girlfriend are currently renting. We are working on baby step number two, opting out from debt. We have, as of yesterday,

just paid off a $2,000 credit card. We're looking whether we need to continue chipping away at our current debts or if we are better off to purchase a home and get away from renting at the same time as we are working on these. Never buy a house with someone you're not married to never if you want to buy a house that's fine if she wants to be a buy a house that's fine we talk about that but never buy a house with someone you're not married to you're entering into a general partnership and that is a dangerous methodology. Lots of people who break up really wish they didn't do that. So it's a whole different world than going through a divorce. The home will be individually. It won't be together.

It will be my home. Like you would buy it and you'd have a roommate. Yeah. Okay. But no, and then secondly, to answer your first part of your question, I really would not buy a house until you're debt-free and you have an emergency fund in place. Because here's what happens. I want the house to be a blessing to you, not a curse.

And when you move in a house with payments everywhere and no money, the water heater will go out the first week, and three weeks later, the heat and air will go out, and four weeks later, the roof will leak. I mean, you're asking for trouble and uh owning a home is more expensive most years than renting but over the course of it with it going up and so forth in value then it becomes a great investment so i'm firm believer in buying a house but not when you're broke and right now you're broke you're still getting out of debt so if you're the one buying the, it's not your girlfriend because there is no we. You're not married.

You have a roommate. So you just, you know, you get out of debt. You have your emergency fund in place. You have your down payment. Then you buy a house. And buy a house on a 15-year fixed where the payment's no more than a fourth of your take-home pay. And if you'll keep that that clean, then you won't have regrets later on the financial parts or on the relational parts, either one.

Good question. Thanks for joining us. Open phones this hour as we talk about your life, your money. It's a free call at 888-825-5225. This is the Dave Ramsey Show. Thank you. Our scripture today, Proverbs 3, 13 and 14. Blessed are those who find wisdom, those who gain understanding, for she is more profitable than silver and yields better returns than gold. John F. Kennedy said leadership and learning are indispensable to each other.

Marie is with us. Marie is in Chicago. Hi, Marie. Welcome to the Dave Ramsey Show. Hi, Dave. Thanks for taking my Ramsey Show. Hi, Dave. Thanks for taking my call. Sure. What's up? Hi. I needed your help in deciding what is okay to include as income when determining what my mortgage should be.

Right now I have my main job, my normal nine to five that I've done for over ten years. But for the past two years, I've worked a side job. And I'm newly divorced, thankfully debt-free, but that also adds an additional $500 a month in child support. I'm just feeling a little nervous about including the side job and the child support when determining how much mortgage I should get. How old are the kids? Kids are 16 and 12.

Okay. So some of the child support goes away in two years? Yes. And the rest of it goes away in six years? Correct. Right. Okay. So what's going to happen to your main job income, not your side income,

but your main job income during that two years and during that six years? Are you on an upward trajectory with your career? Yes. Okay. So it could be that your loss of child support two years from now would be offset by your increased income at your day job? Yes, I agree with that. Okay.

So we don't have to worry about that too much then. I would not include the side job because I don't want to have to do a side job to make my money work. Okay. Does that make sense? That's what I was thinking. Yeah, so I would include the child support. I would include the child support with the anticipation that your day job is going to go up as much as your child support loss is going to be two years and four more years after that, you know, two-year mark and six-year mark, because it should go away at 18, I suppose, right?

Correct. Yeah, 18 years old for the kids, yeah. And so I'd include it now on that, but I probably would not include the extra job because then you're chaining yourself to that extra job, and I don't want to be chained to it. Okay, yeah, I agree with that. I was just in my rental, which is $1,800 a month,

which including all of the other income is really comfortable, but just my primary income right now would be at the almost half. Yeah. Well, your primary income plus child support, though, probably is reasonable. Right. Yeah, and I think that's a fair way to look at it so hey good question carol is with us in dallas texas hi carol welcome to the day where is he show hi dave thanks for taking my call sure what's up um i started reading your books

and i got far enough in that i found out that I'm too in debt to start your program right now. No, you're not. You didn't understand the program. Well, I had every, because you said you had to be current on all your credit cards. Well, before you start the baby steps, you've got to get current. But getting on a budget and being responsible with money is my program. Well, that's what I'm trying to do. I'm working on that.

My problem is I'm 57 and I'm self-employed. I'm a pet sitter. So most of the time I know how much I'm going to get at my job. I have my longest-term customer, my most prolific customer, and so I'm not always sure, but I know it's going to be good. Anyway, so I was keeping up with all my, everything was current. You know, you looked at my credit report. It looked good until two months ago and one big job got canceled, you know,

all of a sudden, unexpectedly. And then my dad got some unexpected medical bills. My dog has cancer, so that's a vet bill. So, you know, the devil's come calling now, and I don't know who to pay. You're too broke to pay other people's medical bills. I don't have any choice. He's 90 years old, and I take care of him.

Yeah, you do. You don't have to pay his bills. What are they going to do? Sue him. He's 90. Well, I know. And the medical bills, those are kind of on the back burner for right now. Yeah, so you're not paying his medical bills.

You're broke. Not right now, no. No, not period. Period. Not unless you're a millionaire. Okay. Well, he has his credit card. Okay, that's fine.

That's a side issue. We're trying to get your budget balanced right now. So what kind of debt do you have? It's mostly credit card debt. How much? And there's no student loans. There's no children in the house. I don't have kids.

I'm 57. He's 90. He's disabled. How much credit card debt do you have? Oh, I haven't actually sat down and added it up myself but i was told from uh my bank when they were trying to help me that it was 78 000 but i believe they were including my mortgage in that or his mortgage in that we owe about 33000 on the house, and my car is, we owe $20,000 on my car. I did, you know, I was going to try to sell it and trade down.

Who is we? Well, I just refer to my dad and myself as we. Oh, okay. So is he, does he owe the money on your car? He co-signed for me. Oh, okay. So does he owe the money on your car? He co-signed for me. Oh, Lord. I had a 10-year-old car that was paid for, and a girl with no insurance hit me, totaled my car. And you didn't have insurance?

I did. Well, then why didn't you buy a car with the insurance? I got $7,000 for my total car. So buy a $7,000 car. Okay. So you have a $20,000 car. What's your household $20,000 car note? And you have some amount of credit card.

We have no idea what it is. And what's your household income? What do you make? Not your dad. What do you make? So far this year, I've made a little over $7,700. Okay. That's your problem.

Yes. You're trying to live below the poverty level.7,700. Okay, that's your problem. Yes. You're trying to live below the poverty level. Well, yeah. You do not have an income. And I did get a part-time job. You need a full-time job. Well, my pet sitting at this point is making you poor. But it's too lucrative to turn it down.

It's not lucrative. You're starving to death. You can't say lucrative when you say $7,000 in six months. That's not lucrative. Well, like I said, my biggest customer, she took a month off to go out of state for the summer. Carol, you're starving to death. You're starving to death. You don't have an income.

We need to get your income up five-fold. Pharmacy tech school. $35,000, not $7,000. That's it. That's where your problem is. I do have, when I'm 65, I will have a pension coming from AT&T. What are you talking about? You're chasing your tail.

Listen, you're starving to death. I know. You're 57. You want to wait eight years to talk about how we're going to get out of this? No. No, but I was just letting you know that that is coming. It's not your answer, though. Your answer is you need a job.

I know. That's your answer. Badly. And I want one. But I don't want to give up my pet sitting until I have one. Okay. Well, that or we have to get the pet sitting where it makes five times more than it's making now. If I cancel all my pet sitting jobs in anticipation of getting a job.

No, just go get a job and then cancel them. I try. Like I said, I got a part-time job. Okay, honey. That's all I can do. That's your problem. You've got to get an income coming in. You've either got to go way up on your prices, on your pet setting, and get more of it to do,

or you're going to have to get a job and then quit your pet setting. You're starving to death. That's what your problem is. $7,000 income. It's a pretty simple equation. Hope that helps. Thank you for the call. That puts us out of the Dave Ramsey Show and the books.

Our thanks to Kelly Daniel, our associate producer, James Childs is our producer. I am Dave Ramsey, your host. We'll be back before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Hey, it's Kelly, Dave's phone screener. We finished 2017 with a bang as the fourth most downloaded podcast of the year.

Thanks to all of you for listening and helping us spread the word