The Ramsey Show - App - Point All Your Guns at One Thing and FOCUS (Hour 1)

Episode Date: August 16, 2023

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Thanks for being with us, America. We're so glad you're here. Ken Coleman, Ramsey personality, number one bestselling author of the book Paycheck to Purpose

and host of The Ken Coleman Show, where he talks about your job, your career, how you make money every day. Just got off the air a few minutes ago doing that, as a matter of fact, and he's here to help you today as part of this show as my co-host. So thanks for joining us. 888-825-5225. Macy is in Boise, Idaho.

Hi, Macy. How are you? Good. How are you? Better than I deserve. What's up? So I am kind of new to everything going on. My husband and I, he started school about a year ago for a grad program.

And I was in agreeance with him until I listened to the show of just waiting to pay off student debt until he was done. Because we've heard it through multiple people. When we research it, you can get it paid for by your employer once you get hired. But now since I've listened to you, I've kind of been questioning if we should just pay it off now. It would be $45,000 total with everything when it's said and done. What is this field of study? It's psych NP. Okay.

So who's paying off psychology students' debt? Well, we're both nurses right now, and we work with a ton of nurse practitioners, doctors, and everything like that, and they're the ones who advise us. We've spoken to actually several that have gotten it all paid off. And nurses and doctors in order to get recruited, correct? I believe so.

I'm not sure. Like the place I work at, the doctors that own the business were able to pay for all their nurse practitioners schooling. And so they advised to wait as well. But he's not studying to be a nurse practitioner. Yeah, it's a psychiatric nurse practitioner. Oh, a psychiatric nurse practitioner. I misunderstood. Okay.

I'm sorry. Okay. Well, I mean, if you can find the ability, when's he going to graduate? He'll graduate next December or January. Yeah, I mean, if you can get the first job and the first job comes along and says, yeah, we'll pay this as a signing bonus to get you on board, then that's okay. I don't have any problem with that. What I don't want you to do is engage in something that takes six years or ten years

for you to maybe get out of debt. In the meantime, you've got golden handcuffs to that organization. Okay. So some of these I'll pay your student loans off offers have pretty serious commitments to them, golden handcuffs. And so you don't want to get trapped in a toxic environment for $45,000. Yeah, that's what we thought. But do you know of any, like, grad scholarships? Is that a thing?

I've been trying to look on the website. They're much more rare than undergrad, but they're there. And particularly if you've got an industry that's willing to pay to hire you, pay off student loans in order to get you hired, you probably have an industry that's willing to pay into this now as a scholarship.'t you think i think it's possible i would not expect it in and i heard your question you were saying oh where do i find it where does your husband go to school it's an online program in missouri or graceland it's called graceland university i'd start there i'd start with their advisor department they're going to probably have a lot better handle on what is available to him in that grad program. I'd start there.

If they don't have a lot of great information, then you just get out there and dig. And I would go to who your husband thinks might be his future employer that might be willing to pay off student loans. And instead, maybe they would, instead of doing that, maybe that employer, he would go ahead and agree to start there after graduation, and they would cover his schooling now. See, I've talked to their advisor from the school, and they said they don't offer any grad school, and they sent me a list of scholarships that said that it wasn't for grad school. Okay. Then I went to where we both graduated with our bachelor's in nursing, and they said since they're not a grad school program,

they don't offer any either. So I'm kind of trying to watch YouTube videos. Sure. So keep digging. You've got to keep digging. If you want somebody to give you $45,000, they usually don't just line up at the front door and beg you to do that. You've got to go find them.

So, yeah, you're going to have to scratch and claw and dig around in the nursing world the psychiatric nursing world you're going to have to scratch and claw and dig okay who are the potential employers who are the drug companies that would like to have you uh love them because you gave them they gave you a scholarship and you know who are the industry players that might have scholarship programs that's the first place i would start looking um but you know so it does make logical sense that if there is a xyz potential employer that pays forty five thousand dollars of student loans off to hire you that they probably would consider some kind of scholarship program, especially if it was tied to an internship or you were going to do your residency there or whatever else you've

got to do to finish up this process because they want you to come to work there. But you said it earlier, Dave. I can guarantee you Dave is right. There will be a term of commitment, for lack of a better phrase. I'm making that phrase up. But they will require you to work for them for a certain amount of time yeah and just don't overdo that and here's the thing that it's not free money there'll be some cost a pound of flesh that goes with it and you know what you want to measure is this is it worth it the thing you do not want to engage in is a long-term uh solution for a short-term problem and so engage in is a long-term solution for a short-term problem. And so you've got a long-term commitment to the company.

You've got this program takes six years to unfold. No, thank you. It's $45,000. Shut up and pay it off. Okay. But if you can get hired and they say, okay, we're going to hire you for $100 and a quarter and we're going to pay off $45,000000 with student loans as a signing bonus to get you to come over here because we've got a shortage of pediatric uh nurses and and we need you uh if you find that i yeah i would take that

yes um unless they say you have to work there 10 years you know i mean that kind of thing so now i'm going to investigate all of that but but what you don't want to get into is sitting around based on three law are three doctors and two nurses having a discussion and and all of a sudden you have a new life uh philosophy that i'm going to screw around with student loan program for the rest of my life no no we're going to go ahead and knock it out as fast as possible if we don't get something arranged as a scholarship or even as a signing bonus coming in, you do not want to play with this long term. By the way, I want to make sure Macy knows and anybody listening and watching right now that are dealing with student loans and the reality that October is coming. Forty million people are going to be facing payments starting in October.

And we've got an amazing live stream coming up Tuesday, September 12th, Dave. 7 p.m. You, Rachel Cruz, Jade Warshaw, headlining that event to talk about how we got here as a nation. What do we do about it? That's you individually. You can do it. It's, by the way, it's free, ramsaysolutions.com slash studentloans. It's free, September 12th, 7 p.m. Central, Dave Ramsey, Rachel Cruz, Jade Warshaw. RamseySolutions.com slash studentloans. You don't want to miss that. Yeah, if you've got student loans bearing down on you, don't miss this. September 12th. Get signed up.

It's a free live stream. Go ahead and go to RamseySolutions.com slash studentloans. Thanks, Ken. This is The Ramsey Show. Ken Coleman, Ramsey personality, is my co-host today. Thank you for joining us. Open phones at 888-825-5225. Stephanie is with us in Virginia.

Hi, Stephanie. How are you? I'm good. How are you? Better than I deserve. How can I help? So my father-in-law, he's like 77, 78. He was worried that they have his father's house up in the mountains where we are,

and he was nervous about trying to keep it in the family. So instead of doing what you said, you it in a trust and do it that way or even in a will, he decided to quit claim it to my husband, which is fine, but then he put my 7-year-old on the D2. So I don't know anything about repercussions for my 7-year-old or how to even get him off it since he is now on it. And we do have family members in there renting it too. So this has just kind of made a big mess because we're still in Baby Step 2 while we're trying to do all of this.

Well, it doesn't affect you because you're not having to write any checks regarding it, right? No, no. It was paid off. It was owned between him and his sisters, and all of his sisters gave him their rights to it. I'm just more worried about my 7-year-old. No, you're not. You're just pissed at your father-in-law because he throws his weight around uh he's completely inappropriate what he did was completely inappropriate

yeah you don't do that you don't do that to somebody's kid without talking to the people and getting approval this guy just thinks he can do whatever he wants to do what we thought he was going to do was just put my husband on it which we agreed to and then all of a sudden he put my son on it too and we had no idea yeah it's completely inappropriate i mean anybody call the old man and go you're not supposed to do this crap we told him that this was a shock to us and that this is not really what we wanted and it's not okay just kind of's just kind of in his way. So I don't know.

I don't know that it matters. I don't know that it affects the kid. The only way I can see it affecting the kid is if a renter fell and broke their face and sued the owner. Yeah. And your kid ends up with a half-million-dollar judgment on him. Yeah. Because your drunk relative fell off the porch and broke their face.

Yeah, I mean, that's why I was worried about just repercussions of my stem mule. It's also the repercussions of your husband, yeah. Yeah. Same thing, because you guys now have a property in your name. And by the way, when the taxes come due, who's paying the taxes? So this happened in, in like October last year. My father-in-law helped us pay the taxes because, again, we still get a tax return. Helped you pay the taxes?

Yeah, he did. He pays the taxes. So it all comes out of his account. What happens? The rent goes into a checking account he's on, and so the taxes come out of that account and these people just make up crap don't they they do in all financial steps this is like it threw us for a loop because like i said we're still in baby step two we're getting out of debt and this just it gave us a headache yeah it doesn't doesn't cost you anything but it until

somebody sues you yeah or until the property property taxes go unpaid and the state of virginia decides to come after the owner yeah yeah and because we didn't know if we need a real estate lawyer and trying to save up for that right now while we're paying off debt it's not really that most ideal thing to help get my son off of it we didn't know if that's what we were supposed to do or what i know yeah eventually i don't know that there's anything big hurry i mean the only thing i can think of is just the liability it's just it's just such a toxic family that i don't i don't really know how to guard against this level of stupidity um yeah because the right the right thing to do would have been a trust like what you talked about would have been doing it as a trust yeah maybe i'm not even sure any of that needs to happen but um i mean you got you got broke people in debt we

give them a house which is a liability instead of a blessing and so i don't understand it doesn't and you don't even ask people but i just kind of tell them whatever you're going to do and then you do it. And so, oh my gosh, it's just wrong. So, uh, yeah, uh, if it was my kid, I would get an attorney, a real estate attorney and probably on, uh, you're, you're the parent, you are the guardian. You can sign on behalf of a seven year old and sign a quit claim deed back to your husband for the seven year old's interests and get it out of his name. Yeah. Who are the owners of this deal? Well all of them essentially no apparently her husband your husband is the only

owner and your kid yeah so as of right now yes because my father-in-law was the only owner uh it was the only owner because his and a quit claim deed is not even a good deed i mean that's not all you're doing is i can give you a quit claim deed on that even a good deed. I mean, that's not – all you're doing is – I can give you a quit claim deed on that same property. Because all a quit claim deed says is I quit claiming whatever interest I have. And so you don't even have a good transferable deed. You're probably going to have trouble when you try to sell it someday. But, yeah, I'd get the kid's name off of it. It could just be a simple – you know, your kid does a quit claim to his father now.

So now the whole thing is in your husband's name at that point. But I just think you guys got other problems that are way beyond the issue you're looking at. And I was wondering if they should sell the house, if it had enough equity in it to help their situation. Well, they got a relative. Yeah, I mean, that'd be interesting. This family's all about power moves so if it's if he owns it if her husband owns it i was wondering hey sell it take the profits and put it towards baby step two solve the whole problem yes or no

i i'm not sure you can get i mean i'm not sure his title's clean that's what you're okay this is this is a weird deal yeah this is hillbilly estate planning right here. I mean, that's what this is. It's just really, really bad. Okay. So, gosh. I've seen this my whole life. Everybody around me does stuff like this, and they just make up stuff and think that,

because in their head, this is the way it works. Right. It's actually the way it works, and then don't talk to talk to anybody about it just go do whatever the heck you want to do to your seven-year-old grandson without talking to his parents oh my god it's just you know jeez so i don't know i i guess yeah i guess i would the first thing you want to do is get a kid's name off of it then the second thing you want to do is you want to decide how much you want to stay in it and whether you want to undo all this or not uh because i'm not sure this it was meant to be a blessing at least in the old man's head it's a blessing but i'm not sure it's a blessing

all right andrew's in uh california hi andrew what's up uh yes i was wondering should i cancel the extended warranty and service contract on my car to get a partial refund to use towards other debts. Yes. Doesn't matter what the vehicle is? Doesn't matter. Doesn't matter. Extended warranties statistically are 12% of the cost covers the actual probability of the breakdown. The other 88% are marketing fees and commissions and profit to the extended warranty company.

So you have almost no coverage. Extended warranties are a complete screw job. Even if it's from the actual manufacturer? Doesn't change the numbers. Okay. And the service contract as well? Doesn't change the numbers. Got it.

Yeah. What you're actually getting for what you're paying is about a dime on the dollar and so uh you know in other words on average the things it covers were you to cover them yourself with your emergency fund you would spend 12 cents out of every dollar to do that so if on average uh if the extended warranty is a thousand dollars then uh 120 will cover what it covers on average now on average means some things are high some vehicles might have higher some might have lower your vehicle might have be the one that breaks down and mine might be the one that gets zero or vice versa and but the average is going to be 120 per thousand 12 that's the coverages and that's

what all the data coming from the auto industry is so boys and girls when you're buying a car the number one profit center on the car lot is the 12 by 12 room where the finance manager lives. They make more money on putting you into debt and selling the debt contract back to Ford Motor Credit or back to your local bank and putting you into one of these stupid butt extended warranties than they do on the sale of the vehicle. The number two Profit Center is the garage. Way down the list on the car lot of where they actually make money is the selling of the car. The actual profit on the car, not much. It's the way they get you into finances and into extended warranties and into the garage where they make all their money. This is The Ramsey Show.

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That's chministries.org slash budget. Thanks for joining us, America. We're glad you're here. Ken Coleman, Ramsey Personality, is my co-host today. Mark is with us. Mark is in Atlanta, Georgia. Hey, Mark, how are you? Hey, good afternoon for me here.

Great to talk to you and Ken. I'm 56 years old. I have a 47-year-old wife, three boys. Just got laid off unexpectedly from a $250,000 per year job. Thought I'd have it for at least a couple more years uh he had net worth over three million of that 1.5 million and now in an ira uh half a million in funds and stocks and a one million dollar paid for house no debt whatsoever my question is is well for one does that seem like enough to retire on if need be but But I'm also thinking about pursuing teaching.

So I'm not going to be able to get any cash. I have $150,000 in cash, but I can't tap my IRA until I'm 59 1⁄2. But you've got a half million in investments, non-IRA. I do. Okay. I think you're going to be okay. I don't really want to use that, though. I mean, I had a financial advisor recommend tapping my mortgage temporarily

because it would be cheaper than tapping the IRA. Oh, your financial advisor is a dumb butt. You're kidding me. He's telling you to go into debt and you have a $3 million net worth with a half a million dollar investment portfolio that's non-retirement just use your money man why just sell sell stocks pay taxes yeah yeah yeah yeah well let's not forget mark you told us briefly you wanted to teach so you're not teaching for free so based on your financial situation how much money do you need to make to where you wouldn't even have to tap any of that money or very little?

Yeah, I mean, that's what I'm wondering. I mean, I think we'll need, you know, I got three boys, you know, soon to be college. Most of that's going to be handled already. But, you know, the teaching is going to take a little while to get certified, and that's probably a $56,000 a year job. That's correct. So it's more, you know, almost, you know, more like a little while to get certified, and that's probably a $56,000 a year job. That's correct. It's more like a little volunteer work. Would you have wanted to transition to teaching? It's interesting, you said, I was hoping to do that for a couple more years.

Had you already begun to think, I'm going to keep my quarter of a million dollar job for two or three more years, then go into teaching? Was that already the plan before the layoff? Yeah, absolutely. Just, you know, I want to give back. I'm an Army veteran. What were you doing? Ever since my Army days, you mean my job?

Yeah. It was institutional capital markets. Here's a question I have. I just wonder why you aren't looking to get back in the game, making about the same, maybe even more, and get back on track with the plan you already had. It just feels like you've accepted this idea that, well, I got laid off two or three years earlier than my ideal timeline, and so now all I can do is draw some retirement here.

And I just wonder why not get back in the game. Yeah, it's either that or you know start getting into teaching which will take a year or two to get certified we'll get back in the game and get the teaching certificate yeah don't go make a half million dollars while you're getting your teaching certification 250 a year it'll take you know it'll take a half a year or so to get a job and how do you know if i can find one because i've been looking around a little bit yeah um when did you get light off a month ago yeah okay when you say looking around what does that mean and i mean specifically what do you what are you doing actively talking to people that are in the industry. I mean, basically what I did was a very unique capital markets job and it's not easily replaceable. Um, it's something that, um, you

know, basically is some of it's going to be automated and some of it's, you know, just managed, uh, managed away. Okay. So, so hold on a second. So I can hear it all over you. You feel like I was so niche, I can't do anything else. And that's not true. You have skills and experience that were related to a very specific job that are transferable in a similar industry. Yes or no? Yes. Then again, I mean, listen, let me acknowledge something, Mark. The data says that losing a job, being laid off, has the same psychological and emotional impact on us as losing a loved one. So that was a month ago. And so I want to make sure that it doesn't feel like I'm pushing you too hard here.

I think this has rocked your world. It's thrown your timeline off, and it's understandable. And so you've got to process and heal from this. But I think part of the residue that's on you from this real loss is that you think that you are extremely limited. And if you hear nothing else from me and Dave, you're not limited. You're 56. You're not 96. You've got a lot of skill, a lot of experience. And dare I say, you have a lot of connections too, yes or no? Absolutely. Mark, I want you to feel a hug through the phone here. You've got to get back in there, man.

You've got a lot to offer. And I think this plan you have, and by the way, thank you for serving our country. You're a great American. You're a great American, and you've got a lot to give still. Dave, that's what I'm feeling. Okay, let's say that I'm called immediately to teach, and I hear what you're saying, and that sounds good. You're not.

You're escaping to it. That's you waving a white flag because you're hurting. If you were called immediately to teach, you would have quit and gone and gotten your teaching certificate. You got laid off and then decided. And then you're going to try to tell me you're called. I'm not buying it. Yeah, I hear you.

Okay. But here's the deal, Mark. Even if you don't want to go the route of get back on the path to a two-to-three-year plan, what Dave and I are saying is go get gainfully employed, make as much money as possible. Don't just fall back on that retirement reserve. Well, they just don't use the half million, but we're not borrowing on a HELOC. Absolutely. You probably need a new financial advisor. Um, the, um, okay. So let me ask you this. I'm curious. Okay. Um, what is it that you're wanting to teach and why? Ultimately, I want to teach high school business and finance because I have so much to give and so much knowledge

that's going to waste if I don't give it back. What would be wrong with doing that at the college level? I'm not interested. It's definitely harder. You know, it would be more strenuous on me. I don't want to go into that type of environment. I like kids that are still molded, you know, that are in their teens. You know, as an old Army sergeant, you know, I feel like, you know, I can be a stake in the ground as far as right and wrong to a lot of these kids.

One of my favorite finance professors teaching real estate syndication in my senior year was teaching a graduate-level class that I jumped over and took, even though I wasn't doing grad work, was a practitioner like you. He was not a PhD. He was not a certified professor he stepped over and taught uh three different high-end finance classes to college seniors when i was in college and to this day i remember that guy and we i actually he actually had a cookout for the class at his house we went to his house i can drive to his house right now and And that was 43 years ago. I bet he doesn't live there

anymore. But, uh, but I mean, I think you might be that guy and Oh, by the way, that pays a lot more than 56,000 a year. Yeah, that's exactly right. Um, and, uh, honestly the stuff that, you know, uh, high school seniors can't comprehend, uh, the stuff you've been doing. Uh, it's, it's graduate level and, uh, senior finance level stuff. You can go do this if you want to. Um, I'm just challenging the overarching thing that this is what giving back necessarily means. So, um, if you want to teach basic financial literacy, um, Hey, we'll give you a financial piece. Uh, uh, we'll give you the foundations and personal finance, a high school curriculum that's been taught in 48% of the high schools. And you can go teach it for your high school once you get certified to be a math teacher.

But it seems a little crazy to me that a guy that is as qualified as you has to go get certified to teach math to seniors in high school because you can do math in your sleep. Yeah. What we want you to hear, Mark, is you've got options. And you felt like a guy, you present like a guy who doesn't have many options. And one option you don't have is a HELOC. That is absolutely unnecessary. And heal from this.

Get your head up, shoulders back, and look at some options to get back on that two- to three-year plan. I think things are going to develop as you begin to look for them. This is The ramsey show ken coleman ramsey personality is my co-host today thank you for being with us america we're glad you are here open phones at 888-825-5225 william is with us in Columbus, Ohio. Hi, William. How are you? I'm doing good, buddy. How are you doing today? Better than we deserve, sir. How can we help? Yes, sir. So I'm 30 years old. My wife and I together, we make about $135,000 a year. I paid off my student loans last year. I've now inherited my wife's student loans, which is shy of $21,000.

The only debt that I have is my car payments, and I got about $94,000 in our bank. Just looking for some advice. Do we pay off our student loans with the cash that we have, and then invest the rest of them? Or do we do we you know make the payments on it and and try to try to pay it off within the next couple years when you get married our cash uh we got married in 2020 so how come it took two years for you to inherit your wife's student loans um we kind of we kind of sat around during the pause and wasn't really too smart on paying it off. You're missing my point. I'm messing with you. I'm sorry.

So you inherited your wife's student loans the day you got married, okay? That's what I'm trying to tell you. So you've had those all along. They didn't just show up. That's what I was trying to figure out. Now, how much are they? What's the balance on the student loan? I think it's $20,600.

Okay. And the balance on your stupid car? $20,600. Okay, and the balance on your stupid car? $33,000. I'm making double payments on my payments right now to offset the interest at the end of my loan. All right. Well, William, what we have done here for 30-plus years is try to figure out and help folks like you figure out what the shortest distance between where you are right now and having a million-dollar net worth and being wealthy. Okay?

Yes, sir. And what we've determined is over the years that the most powerful wealth-building tool that anyone has or most anyone has is their income. And when you give your income to car companies and student loan companies, instead of putting it into your 401k and mutual funds, you slow down and you limit the speed by which you become wealthy. Does that make sense? It does.

Absolutely. So that has led us to be the get out of debt people. Although really what we are is the get rich people. And the best way to do that is get you out of debt. Okay. And so that's the paradigm through which are the decision making framework through which we answer your question. So knowing what I know now, having gone broke and lost everything in my 20s, and then you got the opportunity after becoming a millionaire from nothing and then becoming a millionaire now a multi-millionaire again uh and having coached

more people into million dollar net worths and probably anybody out there what would i do knowing all of that if i woke up in your shoes that's the way we answer questions is that okay yes sir based on that i would pay off your car and pay off your student loan as soon as you get off the phone. Okay. You have $94,000. You only owe, what, $53,000. You've still got $40,000. Now, what we teach, the process we teach is called the baby steps.

And the first baby step is save $1,000. Well, you've obviously done that one. The second baby step is to become debt-free everything but your house. You're going to do that when you get off the phone, and you're going to have $40,000. Well, you've obviously done that one. The second baby step is to become debt-free, everything but your house. You're going to do that when you get off the phone, and you're going to have $40,000 left over. Does that sound about right? Yes, sir. And we're also looking to become first-time homebuyers as well. That's wonderful. Then the third step, baby step three, is to have an emergency fund of three to six months of expenses. For you that's probably around 20 25 grand okay so of the 40 we're going to set aside 20 and that's going to leave you 20 in your down payment fund

now you have no payments except your rent and your budget and you're going to start living on a detailed budget so you can squeeze as much out of it and add to that 15 000 down payment fund as fast as you can next spring you should be able to put down a really nice down payment on a home next spring. Yes. My wife and I are actually able to put back in our savings account because I actually just got a nice bump in my pay. We're putting it back about $2,800 a month, and that's after we contributed close to

$56,000 to my 401k. Plus a car payment that you used to have, plus a student loan payment that you used to have. Yes, sir. Because we just got rid of those. So you're going to be able to save $3,500 to $4,000 a month, and adding that to a $15,000 down payment fund, leaving a $20,000 emergency fund alone and you're debt-free,

puts you into a really nice down payment next spring. Awesome. And then be putting 15%. So this is how this plan works. It just smooths everything out, a lot of peace involved, a lot of stability involved, no stress, but leaning in and doing this. So I think you're actually going to do this. It sounds good.

I'm going to send you a copy of the book, The Total Money Makeover. Twelve million people have read it, or more. Twelve million people have bought it. I don't know if all of them read it but some people read more some books got read by more than one person so i think we're good you've heard a lot of stories of how they bought it or it was given to someone who bought it and turned into a really nice coaster and then shows up miraculously at the right time when they're ready to do sitting on the coffee table for four years until i'm doing anyway all that aside we're going to give you a copy of it, and you enjoy it. It'll give you the details on how to work, exactly why I said what I said,

and where we tell you to go step by step by step by step. And, dude, you really ought to have your first million-dollar net worth within about probably five to six years from right now if you'll follow the stuff that we teach. Because you had a really good start. You're a great saver. You had $94,000. Somebody was a great saver.

You or the wife or both of you. He's got the discipline. And to your point. And he's teachable. You know, when we tell people sometimes to liquidate, and I shouldn't say liquidate, but to take a large chunk of money they've been saving to actually kill debt, it freaks them out.

He didn't feel that way to me. He didn't flinch. Okay. All right. He's what's known as William is coachable. Yes. Coachable is a good thing. Coachable will get you hired at Ramsey and keep you hired at Ramsey.

Being uncoachable will cause neither of those things to happen. And by the way, that's usually out in the real world too. You know? Hello. For real. Open phones at 888-825-5225 nicole is in indianapolis hi nicole how are you hi dave i'm doing well how are you better than i deserve what's up i am calling because my husband and i are working on paying off our debts um and he had wondered if it would be a good idea to stop contributing to our 401K to pay off until the debt is paid off.

How much debt do you have? We have $50,000 in consumer, and then our mortgage. Oh, just your mortgage. I mean, just your consumer. Okay, and what's your household income? He makes about $100,000 a year. I'm a stay-at-home mom. And how much debt have you paid off so far?

We just recently started tackling it hardcore after we had our daughter. So in the last four weeks, we've paid off about $1,000. Okay. All right. So if you pay off $25,000 a year's 2 000 a month okay which you should be able to do on 100 000 income uh that takes you two years to be debt free does that make sense yes okay obviously if you pay more you'll be out of debt faster and we tighten this budget on down and do get after it i like it i like it so

let's do it you know so uh now we do teach even though it's mathematically incorrect on the surface it's actually not mathematically incorrect but on the surface it seems to be to stop all investing temporarily because we have found the power of focus completely focusing all pointing all of your guns at one aim point and that's get out of debt the power of focusing to get you out of debt actually mathematically supersedes what you will have gained on those investments in that two-year period of time it wouldn't for 20 years but it will for two years so i want you guys to be on beans and rice, rice and beans, no vacations, no eating out, no nothing until you get this debt clean so that you can start investing again as quick as possible.

If you're going to do all that, yes, I temporarily would stop investing. Okay, and so you're suggesting for two years until we get it paid off? I want you to get out of debt faster than two years. But if you can't do it in two years, you're pretty lame. Right. Okay. In other words, if you lived on $50,000, you worked extra, and you did nothing, and you sold a couple things, you could be out of debt in just over a year.

You see what I'm doing? So, I mean, the deeper you sacrifice, but so that power of that focus, the power of that sacrifice is what gets you out and keeps you out. And that's what I would tell you to do. So, good question. Honored to have you as a new listener, Nicole. Hope that helps you get going. This is The Ramsey Show. Hey folks, Ken Coleman here. Did you know The Ramsey Show is one of the most popular podcasts in the world? Get your daily dose of advice on life and money. Check out all of our shows from the Ramsey Network wherever you listen to podcasts.