The Ramsey Show - App - Practical Advice From America's Trusted Voice on Money (Hour 3)

Episode Date: May 30, 2018

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Music Music 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'm Dave Ramsey, your host. Thank you for joining us. Rebecca is with us in Lancaster, Pennsylvania, to start off this hour. Hi, Rebecca. How are you? Hi.

I'm okay. Good. It's nice to talk to you. You too. How can I help today? Well, let me see how I can explain this best. About three weeks ago, my husband passed away. Oh, my gosh.

My husband was a police officer, and he died in a SWAT training accident. Wow. Yeah. I am 32 years old, and we have three young children. I have a 6-year-old, a 4-year-old, and a 10-month-old baby. I am just coming to learn about all of the benefits that I will be receiving due to his passing. And before my husband passed, we were actually completing Financial Peace University. And so far this year, we have

been able to pay off about $13,000 in debt. And we did have our emergency fund and things like that. I'm just curious as given

the amount of money that I'm expecting, where should I go from this point in the baby step process? Baby, I'm so sorry. Unbelievable. Thank you. Thank you. Well, I suspect you're getting, there's probably life insurance and other things right yes um we have a private life insurance there's also some life insurance benefits through

uh the state the federal government um and their scholarship benefits for my children and then there's like a payout of his salary, like vacations and comp time and things like that that I'm getting here soon. How long will you be getting this salary? I actually, another benefit is that I should be receiving his salary as my ongoing income for the rest of my life. Wow. Yeah. Okay. Yeah.

Okay. And what is that income? Well, that income is about $2,500 biweekly. Okay. And I also have, I'm expecting Social Security from his previous employment. Right. I'm also expecting Social Security from his previous employment. As a police officer, he didn't pay into it, but he did from his previous job. And I also have a rental property.

And the kids will as well. So how much debt do you have remaining, not counting your mortgages? We have about 81 um actually that depends we do have a rental property and i'm trying to figure out not not not counting your mortgages how much debt do you have um it is about 81 000 not counting mortgages yes okay what is on? That is my student loan and a van. I have two student loans, one that is $8,000, one that is $52,000, and then my van. And your van is how much, $30,000? $20,000. $20,000.

Okay. Let me see. I'm trying to get the right numbers here. That's right. You're right. And how much life insurance will you be receiving from the private and the state and the feds? Well, this is still a shocker to me, but I'm expecting about 1.1. Okay.

I'll get a little bit over that. What do you owe on your personal residence? $165,000. And how much do you owe on the personal residence? $165,000. And how much do you owe on the rental? $70,000. Now, there's an issue with that rental property. What is the issue? I just found out that the deed is in both of our names, but the loan is only on his name.

It doesn't matter. Okay. Am I still responsible for that? You're not, but you're not but the property is and i assume the property is worth more than the loan isn't it yes i i wanted the only way the only way you keep the property the only way you keep the property is you pay his loan okay yes so you do want that yeah so we're going to pay it off if you're going to keep it or you're going to sell it one of the two i I'm trying to maximize my incoming income,

and by keeping that property plus his salary and plus his security benefits, that's how I plan to do that. Gotcha. All right. Here's what I generally do. I try to make as few decisions in a tragic situation as I can and let your brain have time to get the fog of grief cleared. Yeah.

Because it's just hard to breathe right now. It's hard for me to breathe, and I don't even know you. I'm just hearing your story. It's unbelievable. Yeah. With three little babies and an accident on the SWAT team. Unbelievable. Wow.

And he's serving the community and just a hero and oh my gosh i'm just there's so much emotion and and so you don't want to make big decisions if you don't have to until some until you can breathe better does that make sense okay so here's what i want to. I want to do two or three things. Number one, I want you to get with one of our smart investor pros for investing, and I don't want you to do any investing yet. But I want you to sit down with them, and they'll help you just park the money in a money market. Okay.

I want you to pay off your student loan in your van as soon as you get the money. That was a no-brainer. Okay. We know that's got to go. Okay. With the student loan and the van paid off, then go ahead and pay off the house. That won't hurt anything either, right? My house or the rental?

You can pay them both off if you want. I don't care. If you're debt-free and you have his income, you have no need of money yes is that right yes i should be fine you should be more than fine yes you were already making it on his income yes i stay home i had already paid off thirteen thousand dollars in debt on his income yes yeah and so with no debt at all this is a cakewalk mathematically mathematically i'm not talking about the emotions and and the tragedy but i'm just saying mathematically it's easy okay so just pay off all the mortgage just pay off everything take the rest of it and park it in

a money market and don't do anything for a year investing wise just cry okay just cry Just cry. Okay. Just cry. And if that rental bothers you, sell it. Okay. If it gives you any hassle at all, just sell it. Okay. I don't want any stress in your life. I want you to have time with your babies and your broken heart for a year. After a year, sit down with a smart investor pro again and start learning about investing

what should be around $800,000 is left in there to invest. And that's going to turn you into a multimillionaire over time. You're going to be more than fine. You're going to be well taken care of. But sit down with a smart investor pro and we're also going to set you up

with one of our financial coaches free of charge. No, we don't want any money from you. We want to just take care of you. We want to love you. I'm so sorry, kiddo. If you've got any questions during this year, you call me back, or at the end of the year, you call me back, and I'll walk with you. Wow. Folks, the real estate market is on fire all over the country.

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It's a day-long event, an all-star lineup, the best of the best of everybody in their genre. Dr. Meg Meeker, the country's leading authority on parenting, teens, children's health. Dr. Les Barrett on marriage and relationships. Dr. Henry Cloud, psychologist, leadership expert, best-selling author of the book Boundaries. Rachel Cruz, two number one national bestsellers on money and budgeting. Chris Hogan, national bestselling author, number one bestselling author of the book Retire Inspired. Anthony O'Neill will be with us, Ramsey personality. And, of course, he is the youth expert author of the bestselling book,

The Graduate's Survival Guide, co-authored with Rachel Cruz, and the new Teen Entrepreneur Toolbox. Ken Coleman will be speaking on career development of the Ken Coleman Show from SiriusXM 132. And that's, of course, the Ramsey Network on SiriusXM. And one of our guys, and he's doing that show live every day now. We just converted it to complete live. So if you want to get to participate in that on SiriusXM, you should. But these are any one of these people you would pay $70 to $100 ticket to hear them speak for an hour.

You're going to get the whole freaking day for $79. It's unbelievable. And that's Kansas City. But here's the drum roll. Are you ready? January the 12th. Going on sale today. We're bringing the Smart Conference to Dallas, Texas.

I love it. January 12th, 2019. Dallas, here we come. Same lineup I just went through, and here's the deal. The tickets for the Dallas Smart Conference are on sale for our launch today, $49. Now, that's a limited number. Those will be gone pretty fast. But the Dallas Smart Conference is only $49 today.

Once those limited number are gone, prices will go up to our normal pricing. But we always like to kick it off with get some sales in the bank and get this thing rolling, baby. The Dallas Smart Conference, January 12th. You can go and get your tickets right now. DaveRamsey.com or call in to customer care. They'll help you at 888-22-PIECE, 888-227-3223. These smart conferences are so fun. They are so upscale, so well done. And you guys just leave knowing marriage and parenting and money and investing and retirement.

Oh, I'm speaking, too, by the way, and career. And I'm in every one of those. I love the smart conferences. You do not want to miss one of these. And there's some really cool stuff built into these this year. Kansas City and Dallas. Kansas City, October 13. Dallas, January the 12th.

And the first handful of tickets for Dallas, if you go fast, at $49. You just cannot get a deal like that. That is an amazing price. Adam is with us in Indianapolis. Hi, Adam. Welcome to the Dave Ramsey Show. Hey, Dave. Good to hear from you. You too, sir. How can I help. Hi, Adam. Welcome to the Dave Ramsey Show. Hey, Dave. Good to hear from you.

You too, sir. How can I help? Hey, nobody. I just had a quick question. I am basically maxed out on my 401k contributions for the year. Not yet, but I will be. And I've got some student loans that I've been working on paying off since the beginning of the year. In addition to my 401k, I've been investing in a lot of physical gold and silver that I have. And I was wondering if I should stop that and focus solely on student loans, or should I continue to do both and kind of, you know, split it between the two? I would stop investing in gold or silver, period. I don't put money in precious metals at all.

They have a lousy long-term track record. Horrible. And, you know, look at a 15- or 20-year track record on them. The rates of return are horrendous. So, no, I would cash every bit of that out and put it on your student loans. Can you pay your student loans off if you do that today? It would be, pay about half of it off. Okay.

So what is your household income? I make about $240 a year. Good for you. How much student loan debt have you got? $60K left. Okay. And so you have $30,000 in metal. Yep, just about, yep.

And you have no cash except your 401K other than that? I've got about $10,000 in cash, too. Okay. All right. I'm going to throw that at it, down to $1,000, and I'm going to temporarily stop your 401K until you get the student loan debt done, and then I'll restart it. You know what?

I wouldn't either. I'm not making $240. You're going to pay that. I only have $15,000 left, or $20,000 left. I'm going to pay that off very, very fast, making $240. I want you to be out of debt, though, by September, okay? Okay. I mean, everything. Everything of debt, though, by September. Okay? Everything. Everything. Dump all the precious metals.

And dump everything out of your budget. Don't do anything to get these student loans cleared up. Like the house is on fire. And then get that in your rearview mirror. Then let's put your emergency fund in place in cash at three to six months of expenses. Start putting 15% of your income away into 401ks,

which you cannot do quite. You're not quite there. Like a Roth after that, maybe? You could do a backdoor Roth is all you can do, possibly. Are you doing Roth 401ks? No, it's just a straight-up employer 401k. They don't have a Roth version? They don't.

Okay. You may or may not be eligible depending on how much is in that and what you've done there for a backdoor Roth. You've got to look at that with your investment professional, sit with your smart investor pro, and figure that out. But, yeah, we want you to start putting – do you have a home? Yes, and I do have a mortgage on that. Okay.

Then let's just start. I want to put 15% of our income away on retirement, start kids' college, and then attack the home. That's our baby steps. Baby step one is $1,000. Two is debt-free, but the house. Three is a fully funded emergency fund of three to six months of expenses. This is the order. Then four is 15% of your income into retirement.

Five is kids' college. Six is pay off your house early. And, Jared, I will tell you this. With your income, you should be a millionaire very, very quickly doing that steps. All of the data that we have studying millionaires, and we've just completed a study of 10,150 millionaires, that is the most detailed study ever done on millionaires, and the largest study by far. Two of the data points that we found with almost every millionaire, north of 80% of

them, pay off their homes, avoid debt of any kind ever, and invest in their 401k. If you do those three things with your income, you're going to be a millionaire in probably six or seven years, if not sooner. You are well on your way, dude. Very well done. And congratulations on doing so well.

Very proud of you. Excellent, excellent work. All right, Jared is in Orlando. Hey, Jared, welcome to the Dave Ramsey Show. You're a blessing, Dave, and you're a great spiritual Christian witness, and I just wanted to praise you for being so strong, and thank you for your wisdom. Thank you, sir.

Quick question. I'm kind of in a predicament. I'm on baby step four, and I'm ready to do four and five. I went through an ugly divorce to make everything short. I had two beautiful daughters. God worked a miracle through my attorney. And 50-50 joint custody. They're eight and six.

Here's my question. I don't know how to plan for ongoing attorney expenses. The situation that I'm in constantly comes up for my attorney. I have to keep her on retainer now for silly stuff, and I don't want to speak ill of their mother because they're the mother of my children, but there's just things that I just wish. I'm praying for a miracle that would be more what sort I'm looking for. Well, over's going to...

I don't know, more... Over time, it'll calm down, most likely. Or it'll escalate to the point that the legal system has to do something about it. But yeah, you're going to have to budget something for... How long ago was the divorce? It was official last June. Okay. What did you spend since the divorce was over?

What have you had to spend? About $5,000. Okay. Let's budget $5,000 a year. $500 a month. That's $6,000 a year. What's your income? I didn't know if you had a special.

Just $49,000. I'm an educator. That's a lot of money. That's what you spent last year. If you think you're going to spend that this year, you just plan the expense. It's a horrible expense, but let's plan the expense. Just like if you, you know, you saw something else that was coming. There was a dark cloud on the horizon.

You plan the expense. You save into it. Otherwise, it turns into debt because you're going to do it. You're going to take care of your girls. Okay. going to do it. You're going to take care of your girls. Okay, I need you to listen to this because one normal routine that everyone does can cause total chaos in your life. 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 every search you're doing online.

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Just search Hotspot Shield on iTunes or Google Play or go to hotspotshield.com. You can be secure in seconds. Download Hotspot Shield by Anchor Free today. Jeff and Bev are with us in Iowa City, Iowa. Welcome to the Dave Ramsey Show, guys. Great. Thank you, Dave. I see on my screen you're debt-free. Congratulations. How much you paid off? $292,000.

Love it. How long did that take? About six years. Good for you. And your range of income during that time? From $70,000 to $110,000. Very cool. And what do you guys do for a living? We own our construction business.

Very cool. Good. How long you had that? Since the mid-'90s. Wow. How long you had that? Since the mid-'90s. Wow. Good for you. Survived the big downturn. Yeah.

Wow. So this six years, $292,000, I'm going to guess and say you paid off your house. Correct. And all the rental properties. Way to go, man. I love it. Not a payment in the world. I'm talking to weird people.

Very fun. Very fun. So tell me your story. What happened that put you on this journey six years ago? I was on a job site that I was scanning XM Radio and found you. And then from there, I listened to you more and more over the radio. And I found your book. I read your book.

And then in 2011, I took your FPU class. Okay. Very cool. Bev, you along for the ride on all this? Are you along for the ride? Yes, I was. We are together. We ride our bikes together. Ah, okay all right good so you went to the financial peace university class with him then

yes we went together very cool good well way to go you guys how old are you two well i'm older than him i'm in my 60s and he's in his late 50s. And everything is paid for. Way to go. I love it. Our home and our lake home also. Very cool. What's the lake house worth? $75,000.

Yeah. And what about your home? Somewhere around $90,000 to $95,000. Good deal. And you said you had rentals as well? Yes. We have several rentals in the town next to us. Okay.

And what are they worth in total? You know? Total is around $550,000. Okay. Very cool. Very cool. So you guys are either above or approaching millionaire status then, right? We are probably within a couple years i'm hoping if everything goes good

well done very well done so proud of y'all congratulations okay so somebody's listening that is 52 years old and they're in debt their house their rentals the lake house tell them what they should do. What did you do? What's the key thing that got you all out of debt? One of the key things I did, Dave, to get us out of debt was every year I always wrote down goals. And to start off with, you got to want to get out of debt because I agree totally with what you say. You can walk into debt, but you're not walking out. You got to run like a gazelle. So every year I always wrote out goals and where I wanted to be at the end of the year and also had long-term goals like five or 10 years out. I didn't always

meet my goals, but I was always shooting for something. And if you really want to get out of debt, then the budget comes into play. And you look where your money has gone or where it shouldn't go. And you decide what is a need and what is a want. I am shocked and surprised at how many people don't do things intentionally, like you're talking about, when we know that you don't do things intentionally like you're talking about when we know that you don't accidentally win, you know? And that's all goal setting is, is we're going to be intentional and we're not going to try to accidentally have a random strike of lightning

and hope we win. Oh, well, that guy is so lucky. Very few people are lucky. But there are a lot of people that are blessed by because they set a goal they aim at the target even if they miss the target they're heading so much in the right direction that they still win and that's what happened with you guys right correct absolutely there's a high correlation between the millionaire folks we study and the fact that they're goal oriented and they they take their own destiny in their hands.

When I was with Condi Rice last week at our entree event, she said, you cannot control where you came from. All you can control is where you're going. I thought, whoa, that's a millionaire statement right there. You know? And that's exactly what you're saying. Yeah, this is good. Good stuff, guys.

Well done. So was it hard? Oh, yes. Oh, yes. No doubt. So was it hard? Oh, yes. Oh, yes. No doubt. What was the hardest part? For me, it was when I would finish a job and the extra money that we made always went to the bank. And I got tired of going to the bank with all of our extra money.

But it was a goal that we had in mind. That's what we were doing. What about you, Bev? What was hard for you? Hardest part. I think the hardest part was the very last payment we made at the bank because it was a big chunk and it was a job you'd finished, and all that went to the bank, and we could have had it.

But now you got it from now on. But now we got it. Amen on. But now we got it. Amen. For the rest of your life. Well done, you guys. So proud of you. Very well done. Thanks for sharing your story with everybody.

It's inspiring. We've got a copy of Chris Hogan's Retire Inspired book for you, number one bestseller. That's what we want for you guys. We want you to be millionaires now and to be outrageously generous along the way. And you're well on track to do all of that. Congratulations.

Well done. Thank you. Thank you. Jeff and Bev, Iowa City, Iowa, $292,000 paid off in six years, making $70,000 to $110,000. Count it down. Let's hear a debt-free scream. One, two, three. We're debt-free!

This is how it's done! Oh, you gotta love it. You gotta love it. Well done it well done well done well done wow thanks for joining us so crystal is on the the ramsey baby steps community on facebook if you didn't know there is an official community. It's called The, capital T-H-E, Ramsey Baby Steps Community at Facebook. It's a private Facebook group, but you can join if you follow the rules, behave in there, and help other people in there. It's a great community, a lot of people talking and encouraging each other.

Crystal says, I'm a new listener, and I've got approximately $25,000 in debt. $17,000 of it is in collections. Do I snowball the entire amount or just what is currently due? I would do two debt snowballs, a list of debts that I am paying payments on. If you're paying payments on any of that that's in collections, I would put that in a regular debt snowball with your other payments that you're paying payments on. Let's knock that debt snowball out first, and then old bad debt that you are not paying payments on but you need to go clean up, then do a second debt snowball on that one at a time,

and call them up and offer them. You're going to have to find out what they now say the balance is, but you can settle the debt for what you owed originally. They will have doubled or tripled it or some kind of stupid stuff like that, and you have to work with them to get it back down to what you really owe because they're just horrendous in that business. But anyway, you get back down into that, and you get the number, and you get it in writing, or you don't give them any money,

and you settle each one of those with a lump sum, no payments on the second debt snowball. You go to that smallest debt, and you settle it. Then you move to the next one, and you settle it. Then you move to the next one, and you settle it. You get it in writing and no electronic access to your checking account when you're dealing with a collector. Now, I don't mind electronic access to your checking account to do all kinds of other things. I use PayPal.

I have my cable. I have insurance payments, water bill payments, all this kind of stuff. Alarm. A lot of stuff comes out of our checking account automatically. I don't mind that at all. But no collectors get access to your checking account automatically. I don't mind that at all. But no collectors get access to your checking account. Why? Because they lie. They'll clean you out

and then try to get your money back. I left it to you. No, don't do that. Get it in writing and no electronic access to your checking account. This is the Dave Ramsey Show. Hey, this is Dave Ramsey. You know, most of us have gotten behind on our bills at one time or another. That's nothing to be ashamed of. It happens. And many of us know the embarrassment that comes with those harassing calls from collectors. Some of these guys are just scum. But then there are the collectors that are just plain crooks.

These are the guys that take it a step further and they violate the Federal Fair Debt Collection Practices Act on a daily basis. They're breaking the law and they need to be stopped. The truth is debt collection is the most abusive, out-of-control industry in America today. But you don't have to put up with it. If you have collectors calling you multiple times a day, calling you at work after you've asked them not to, cursing or threatening you in any way, then you need to visit CollectionBully.com. These folks will connect you with an attorney who I know can help you. These attorneys know how to stop collection agencies from bullying and threatening you anymore. CollectionBully.com.

Go to CollectionBully.com today. That's CollectionBully.com. Our Scripture of the Day, Proverbs 12, 11. Whoever works his land will have plenty of bread, but he who follows worthless pursuits lacks sense. You know what? I have done both. You ever followed a worthless pursuit? Actually, I did that last week. I actually watched about two hours of television.

That was like following a worthless pursuit. It was a complete freaking waste of time. It was like eating two pounds of cheesecake. It was just, you know, you're just sick when you're done because there's nothing good has gone into your body or your mind. I just completely wasted two hours of my life. I'll never get back. I followed a worthless pursuit.

But whoever works his land will have plenty of bread. But he who follows worthless pursuits lacks sense. So I guess the key to that is spend more time working your land than you do following worthless pursuits, and you'll come out ahead. Because we all do a little of both, you know. It's just the ratio, right? Is it more working and less worthless pursuits, or more worthless pursuits and less working?

Yeah, there's your problem. Bob Hope said it this way, I've always been in the right place at the right time. Of course, I steered myself there. Yep. Yeah, that luck thing, it always comes with work, doesn't it? Reese is with us in New Jersey. Hey, Reese, how are you?

Hi, Mr. Ramsey. I just have a quick question for you. I've been juggling the idea back and forth in my head of getting rid of my current vehicle and downgrading to a cheaper one in hopes of expediting my baby step two. I just kind of wanted your thoughts. What do you owe on it? I owe $14,500. What's your income? $49,000 in my main job and then $5,000 in a side job. Good for you. How old are you?

26. Good. And how much other debt other than the car? This is where it gets kind of sticky. The majority of my debt is student debt, just shy of $47,000. Okay. That's it. What do you owe on the car? $47,000. Mm-hmm. Okay. That's it. What do you owe on the car?

$14,500. Oh, you owe $14,000. What's it worth? It's worth, Kelly Blue Book, I just checked, $13,000, so I'm upside down $1,500. Mm-hmm. Okay. All right. So if I just do, I do big number math is the way I do this.

Here's how it works, okay? So I got $14,000 and $40 i got 14 and 40 is 54 in debt right uh yeah 45 for the student loan oh i'm sorry okay so 59 59 60 in debt okay okay and you and you're making you said uh 40 plus the part-time job right uh yeah 49 plus five for a total of 54. Okay. So if we pay off $30,000 a year for two years, you're debt-free. Out of 54, you're 26 and single. That's beans and rice. You can do that. Yes, sir.

Or instead of paying off 30 in two years, you could pay off, what would it be if we took that 14 off, right? That'd be seven less a year. And so instead of 30 a year, it'd be 23 a year. So it's $2,000 a month if you don't keep the car. It's $2,500 a month if you do keep the car. If you're unwilling to cut your budget that deep you should sell the car okay because i would want you to be debt free in two years so i'm doing some very simple math there are you following me i mean it's nothing not no rocket science involved here it's just

no no not at all i'm taking your fifty four thousand dollar income and putting you on no life budget either way really and so the only question is are you going to be out of debt in 18 months or in two years do you like the car a lot uh yeah i really do like it a lot cool what kind of car is it uh toyota corolla that's a good car 2014 yeah yeah it's not bad um They're good cars. Exactly. That's kind of my – sorry, go ahead. No, it's okay. If I'm in your shoes, and that's the way I answer questions here, I would be willing to cut my lifestyle in order to keep my car.

Okay, that's kind of my thought process because it's like I can sell it, downgrade, gets me out of debt maybe six to eight months faster. Exactly. It gets me out of debt maybe six to eight months faster, but I'm out of debt with a hoopty as opposed to eight extra months, and I have a car that should, in theory, last another 20 years. I don't know if you go that far, but it'll last a lot longer than a hoopty, and you won't turn around and move up in a car as soon as you finish your debt snowball. So your theory is right, except for that last little bit. But, yeah, and here's the thing. You just got to commit to $2,500 a month.

Okay. That's $30,000 a year. That's $60,002. And so – Perfect. And until I get to that, we don't eat out unless you're working in a restaurant, you know, and we're not going to the movie unless you're working there. And you're not going to spend any money.

You don't have any money. You're getting out of debt. So you're going to sacrifice social life, party time, whatever it is you do with money that you used to do with money, and you're going to put all your freaking money on this, and you're going to be done by the time you're 28. Can you imagine what it would be like to have no payments in the world? I literally can't imagine.

You're on your way, brother. You're going to do it. And I'm going to get to talk to you brother you're going to do it and i'm going to get to talk to you you're going to call me back and do your debt-free scream right here i can tell i'm coming down to nashville for that i love it man i'll give you a personal high five love it man get after it brother you got this uh jordan is with us jordan's in bloomington indiana hi jordan how are you i want to be better than I deserve. Good for you. How can I help?

I am a 25-year-old husband to a wonderful wife and a three-month-old baby girl that we have. Woo-hoo! Life is good. Yeah, life is great. But we're about $56,000 in debt. Whoops. I'm making about $39,000. All of the debt is 75% to 80% of it is mine personally with student debt.

Then joint combined we have the hospital bill, which we have enough to pay off right now. And we just got a new car because the only car that we had had no AC. So we had to have that one for the baby. So how much did you spend that you didn't have to spend? What's this car cost? Actually, we're not doing bad. It's $8,500 is all that we have. That's all that we have left on it. Okay.

And we just bought it before the baby came. Okay. All right. Okay. Number one rule, if you're going to win with money, no more justification buying stuff for babies. Fair enough. Babies have survived centuries without air-conditioned cars. And you could have bought a car cheaper than that.

You used the baby as an excuse to do something that you couldn't afford to do. It's behind us now, but going forward, no more rationalization using the baby. It's not fair to the baby. Don't blame stuff on the baby. So just say, man, just start working your dad's snowball. Start working your baby steps. You can do this. Yep. So right now I have pretty much we're putting about 310 to 325 in our student debt.

Two of them are personally in my name and then the other one's in my father's. It's the parent plus loan, which I hate. If I would have known how much student debt I would have racked up, I would have probably Okay, Jordan, I don't want to run out of time. What's your question? Question is, what can we do to get this down? I want to be debt-free by 30. Okay, how old are you?

25. Oh, you're going to make that easy. You're going to make that easy. You're just going to have to work like a crazy man, live on beans and rice, rice and beans, get the every dollar budget going, and get get on your phone with your wife sit down both of you set the goal and say we're going to live like no one else so that later we can live and give like no one else but we're going to pay a price we've made a mess we've got car debt we got student loan debt we've been sloppy and disorganized but now it's grown-up land. Now we've got baby, and now we're going to start being grown-ups.

Adults devise a plan and follow it. Children do what feels good. So you're going to sit down, get your budget going, and your budget's just where you make every dollar behave. You squeeze it by the neck until it can't breathe. You make every one of those dollars behave. You list your debts, smallest to largest, and you pay them off in that order. Pay minimum payments on everything and attack the little one and work your way right down. I'm going to send

the baby a gift. It's the total money makeover book for his dad and his mom. So hold on. Kelly will pick up and we'll send it to you. It'll show you exactly how to do this stuff. That puts this hour of the day Ramsey Show on the books. We'll be back with you 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 guys, this is James Childs, producer of The Dave Ramsey Show. I'm excited to announce that we're now carrying on 600 radio stations across the country. To find one near you, head to DaveRamney.com slash show. Over the years, I've seen so many families suffer by not having life insurance. It's not that they didn't care. It's just that they didn't know. So they did nothing. That's a huge mistake. Listen,

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