The Ramsey Show - App - Resist Short-Term Wants to Reach Long-Term Goals (Hour 3)

Episode Date: May 2, 2019

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🎵 🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, it's the Dave Ramsey Show, where your money and your life are the focus. Sitting in for Dave, I'm Chris Hogan, and I'm excited, America, to take your money questions. I'm here for you. So if you've got a question about money, I want you to give us a call. That number to call is 888-825-5225. Again, that's 888-825-5225.

Or if you're via social and you want to send us a question, just send it at Ramsey Show. We're on all the platforms, as you can imagine, Facebook, Twitter, Instagram, and YouTube. The YouTube channel is absolutely fantastic and is rocking. So we'd love to hear from you if you've got questions. So I'm going to the phones because that's what we do. I've got Matt on the line in Washington, D.C. Matt, how are you? Chris, I am so grateful.

Thank you for taking my call. Yes, sir. I'm a little scared. Oh, don't be scared. What's going on, buddy? So my wife and I are both new homeowners and new parents. And unfortunately, my wife got laid off in March. And subsequently, I also lost my job just last month.

Oh, man. So we went from $143,000 in net income annually down to zero. Okay. And so, by God's grace, we've set aside a little bit of money for an emergency fund. And we're trying to figure out how to get our emergency fund to stretch long enough for my wife to have our baby to an age where we feel comfortable leaving her in daycare and for myself to line my next job. Okay. Wow. You got a lot going on, my friend. Um, how old is your child? She is two and a half months old. Okay. Brand new, brand new. Um, I can't imagine your stress level right now. Um, that's got to be, what's got to be. The things that went on to the loss of job, did they come out of the blue? What happened?

Yeah, they did come out of the blue. My wife has been in marketing for a few years for her company. They outsourced her team. And she actually got laid off while she was on maternity leave, which we thought was illegal. But after consulting a lawyer, they said that they were technically within their right to eliminate the position and walk away. They were gracious in at least offering a severance package, which has contributed towards our safety net greatly. So that was my wife's firm. Myself, I work in high-pressure sales. So I missed my first quarter.

Frankly, it was performance-related. And a lot of that was just, you know, while I had done my best, it just didn't work out for my company. Okay. How long have you been with them? How long have I been with? Yeah, How long have you been with them? How long have I been with? Yeah. How long had you been with that company?

So with this firm was not very long, to be honest with you. It was a newer, newer company. I've only been there for five months, but previous to that, I've been with my other companies for, you know, two to three years at a time. Okay. Were you selling a service or a product? Um, it was a hybrid of both. Okay. Um, all right. So your wife was, is in marketing, you do sales, uh, emergency fund. What kind of dollar amount did you, do you all have left right now? Yeah. So cash wise, we've got, um, 11,500 or so to our name, but we also have debt.

I've got $25,000 in student loans and $15,000 in credit card debt. Okay. What else? That and then the mortgage, to be honest with you. That's pretty much it. We pay about $21.34 a month in our monthly mortgage payment. $21.34. Okay. How much is the home worth? honestly that's pretty much it we pay about 21 34 a month in our monthly mortgage payment 21 34 okay how much is the home worth uh the home is worth 381 000 and you owe how much on it right now right now we owe about 355 000 on it okay so it's 21 34 you got 25 000 the student loans are they payable right now have you been paying paying on them? I have been paying on them, yes.

How much have you been sending them? About $300 a month, give or take. Okay. And on the credit cards, $15,000. How many credit cards is that? Two. Two. Okay.

And what's the minimum payment on that? $132 on one, which has a 0 zero percent apr for the next year okay um and then the other one has um a i've renegotiated uh they give me another promotional rate at zero percent um but there is a what's the payment on it payment on that's about 150. Okay. So you don't have any car loans or anything? No. My car is fully paid for. My wife's car was a gift from her dad. Okay.

So that's paid for. All right. So looking at this, you know, you've got $2134 is what you're paying on the house, $132 on about $282 on credit cards and $300 on student loan. You've got $11,000 emergency fund. Here's the reality, and we'll dive into the numbers first. Then we'll end where we need to. I'm glad you've got an emergency fund.

I'm glad you got that there. I'm sorry you're dealing with these changes, but here's the time for you to rise. This is the time, Matt, for you to go, you know what? This is not where I want it to be. This you to go you know what this is not where i wanted to be this is not the game plan uh this is not cool this stinks right and you probably had that period of time and but now is the time where you haven't done high pressured sales this is the time that you rally for the sake of your family this This is where you dust up your resume and get that bad boy updated. And I know you've got contacts all around the DC area from people you've

served and served. Well, you email them, let them know you are on the market. You're looking, uh, and would love an opportunity as a new father, uh, to be able to get back to work and you get out and you earn your way past this, right? You earn your way past this and this, you do high pressure sales. This is a high pressure situation, but Matt, I'm telling you, you can do this. You can do this. You need to have a couple of good friends around that you can call and you can gripe about it with, but, but at the end of the day, you need to show everyone that this is just going to be a blip on your radar. You can fix this. And I believe in you. And I believe that if you, in this situation,

knowing this is not where you wanted to be, that you can change it. And I know you can. I believe in you. But you do need the right people around you to cheer you on. It's not going to be easy. And I don't want you, Matt, to go look for for the job i want you to find a job see the sooner you get money coming in you start to save and protect the emergency fund that's sitting there and you you all aren't eating out okay like the only eating out you're doing is when you cook a meal and you take it outside right if you walk out there with the plate and eat that's you eating out you guys are eating what's in the freezer you're eating what's in the cabinet and you're going to have some creative meals. Oh, you might have some spam with ramen noodles or whatever. Hey, eat it, right? It's nourishment. But the bottom line is,

is that you're going to protect that emergency fund. Don't do any pity shopping, right? No, don't even go to the mall. Matter of fact, don't even go to Amazon. Don't look online. You aren't buying anything right now because we have to conserve. We have to protect that money that you have sitting there by bringing some extra in. You and your wife were Allie. You guys talked together. And guess what? Listen to her.

She's got some fears. Her fear doesn't mean you're inadequate. It just means she's feeling some stuff. And you tell her about your fear. And you guys work through this thing and you set up a game plan. Because it's a new opportunity right now. And you can do it. This is The Dave Ramsey Show. Are high health care costs getting you down?

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spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years, and our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Hello, America. You are listening to The Dave Ramsey Show. I'm Chris Hogan filling in for Dave, and we are taking your questions on money and life. So if you're out there and you've got a question, call us. The number to call is 888-825-5225. Again, that's 888-825-5225.

We'd love to take your questions and to be able to help you. I'm going back to the phones. I've got Melissa here on the line. How can I help you? Hi, Chris. Yeah, I was calling on Baby Step 2. Okay. And I have a daughter that's in college.

And according to the Baby Steps, I believe they ran this thing on life insurance for four of my kids now, two of them for about 18 years. So I know they have cash value. Should I use the cash value to pay on my daughter's college tuition or should I use it towards my dad? Okay. All right. $28,000. All right. You had cut out a little bit, Melissa.

So let me back up and see if I've got it all. So you have whole life right now on your kids, and you're asking, should you cash that out to help pay for their education or use it to attack your debt? Is that correct? Yes. Okay. All right. So a couple of things here. Tell me about the debt you have. I have two credit cards.

One has about $5,000. another one has $9,000. I have an air conditioning system that I had to replace at my home that has another $6,000. I've got a rooms to go account that has about $3,000 on it. So no car debt. My cars are paid off, thankfully. Okay. no car debt. My cars are paid off, thankfully. Okay. No car debt. Are you a homeowner or are you renting? Homeowner.

Okay. All right. How much is your mortgage? $1,300. Okay. All right. And right now, you have four kids? Yes.

All right. And how many are currently in college? One's in college and one's currently a junior. Another is going to college pretty soon. Okay. All right. And so you guys took out these whole life policies on them when they were young? Yes.

All right. And what was the thought process of that? The whole life policy? Well, I mean, we were young. I really didn't know much, and I thought I was doing something good for my kids when they were older, and I'd be able to cash it out when they're 18, and they'd have, you know, it's really not a lot of money, to be honest. I thought it'd be more than what it is.

But if I cash out all four of their policies, it's going to total up to about $6,000. Okay. Well, looking at that, you know, what's the bill for school? How much do they owe? She, after scholarships and stuff that she has, she owes about $9,000 a year. Okay. All right.

So, a couple of things. Do you have you and your are you married yes okay do you and your husband have term life insurance on you yes we have term life on all of us okay his job okay it's through his job yes okay all right got a couple things need to talk about here so first and foremost, term life insurance is what you want to have. So I'm glad you have that. The issue is, is you have it through his job, uh, which means you have a portability issue. If he were to lose or leave that job, you are now losing and leaving that insurance. So I want you to get term life insurance on you and your husband outside of the job.

You can contact Xander Insurance to be able to get that done. As far as the whole life policy on the kids, because, again, your adult children, we'll call them, they can get term on them as well if they're married or they have dependents counting on them. But, yeah, this is something you totally can cash out that whole life policy that you have on the children and be able to use it either for the debt or the school loan. You know, with your daughter or whoever's in college, they also need to find a job. Okay? Love that they have some scholarships. I love that they're doing that.

But they also need to get a job to pay for that $9,000 gap. Because what I don't want them to do is to go for three more years, and now that $9,000 grows into $35,000. And now they end up with their diploma and a big debt souvenir around their neck. Yeah, and the university she's going to has a program called the LRAP, which is new. They said it's called the Loan Repayment Assistance Program. So, I mean, that kind of makes me feel a little better, but, you know, I'm still alone. No, it doesn't make me feel better. That's called semantics. Okay. That means they change the name from loan to rapid repayment system, helper people, friends. No, they're not. Okay. That's not a friend. So don't let that name

fluffy and cute and everything make you feel better. It's still a loan. That's not what they want. So I'd rather your daughter's son take longer to go to school debt-free than to leave with that souvenir. So, no. Get a job. Let's attack it. Let's pay it. And for you, in looking at this, you know, I'm more apt to tell your adult child to get a job to pay for that $9,000 gap. You're going to get about $6,000 coming in once you cash this out. I'd reach out to an insurance ELP to walk through and understand and make sure

you're getting all that you can. But that $6,000, if we work the debt snowball, going small is the biggest, that would give you an opportunity to attack the rooms to go account and to make a dent into one of the credit cards. So that's the option. You've got an opportunity to move forward. I want to encourage you to plug into EveryDollar. It's our budgeting tool that is absolutely amazing and gives you more control over money than you ever thought possible. And I'm also going to send you a copy of Dave's book, The Total Money Makeover, which will walk you through kind of the baby steps as well as let that snowball. Matter of fact, I'm going to send you three of them so you can give a couple to your children as well as have one for you. So again, mindset shift,

how we go about it. It's what gives you an opportunity to stay in control. All right, going back to the phones. I've got Kira on the line. Kira, how can I help you? Hi. Yes, it's an honor to be on the phones and thank you for taking my call. Absolutely. It's good to talk to you as well. So I just found the Ramsey and his program and my husband and I are in Financial Peace University. Just got started. Great. Finished lesson two on Sunday. My question is we're on baby step two and I'm basically really fired up. I want to throw everything, including the kitchen sink at our debt because it is ginormous. Even with the debt snowball, we're looking at a couple of years to pay it off.

My question is, I live in an apartment. I don't really have a lot of resources around town, even though I've lived here a while. I'm getting a little overwhelmed with selling as much as I can. Like, you know, I can't really do a garage sale out here. I don't have a garage. And I'm trying to figure out how do I best sell everything that I possibly can, like maybe pawn shops, you know, still getting value but not going too low so that I'm just basically selling it for, like, pennies on a dollar

instead of maybe eBay where I could get more but it would take longer. Okay, great question. So, Kara, before we do all that, tell me about the debt. What do you owe? $188,224. Okay, and what is that? Break that down for me. Okay, so my husband and I both have student loans, so about $141,000.

Okay. And then I have a car loan so about $141,000. Okay. And then I have a car loan of just under $18,000. Okay. And then with credit cards, personal line of credit, all of that is about just under $30,000. Okay. All right. So you all have had like a debt-a-palooza going on. Unfortunately.

No, I mean the that's what happened i mean that's what can happen you know i just told you guys if we found you years ago it would have changed our lives but we're here now you're you are here now that's exactly right you've made a decision you have been you've enrolled into Financial Peace University and you're focused. I know you can do this. What's your all's household income? We make gross roughly $94,000. Okay. All right.

So the opportunity is there. The key is, like you said, you're plugged into Financial Peace University, so that's going to give you control and you're learning. You're taking the steps forward and doing the stuff you need to do, which is the right way. But Kira, I would look at, you're right, living in an apartment, it's hard to sell things. They have virtual garage sales. There are some of those tools that are out there where you can post photos of things and get it sold and not have to give it away. But you want to redirect that money toward the debt, just like you said. And the student loans are going to take a little bit longer, but listen to me, the credit cards,

personal loans in the car, oh, they're on the clock. It's time to get them things knocked out. You all can do this. This is The Dave Ramsey Show. Hello, America. This is the Dave Ramsey Show, where we're talking about your money. Because it's your life and your money. You work hard to make this money. Well, we want to make sure we're taking the right steps at the right time so we can get to the right destination. I'm Chris Hogan filling in for Dave.

And if you've got a question, I want you to give us a call. That number to call is 888-825-5225. Again, that's 888-825-5225. I'd love to hear from you. Okay, I'm going back to the phones. I've got Polly on the line. Polly, how are you? Hey, Chris, I'm good.

How are you doing? Oh, I'm focused and not finished. How can I help you? Yeah, so I recently started with Dave Ramsey back in February. I'm on baby step two. Okay. But about three weeks ago, I fractured my arm, and so now I have some medical bills coming in. Looks like I'm going to owe

around $3,200 and my deductible is $3,500. So I'm going to be responsible for all of it. So wondering, I have around $1,500 in HSA, but I'm wondering for the remaining bit that I'm going to owe, do I use my emergency fund for that or do I set up a payment plan and pay as I can? I already talked to the hospital and they won't do like a discount if I do a payment in full. So just trying to figure out options. Well, my goodness, Polly, first and foremost, what happened to your arm?

I fell off my bicycle a few weeks ago and I was out biking. I'm so sorry to hear that. Yeah, it's a stupid mistake. Yeah. Well, did it require surgery or just resetting? It didn't. Okay. No, just a sling to fix it.

So thank goodness. It could have been a lot worse. Yes, it could have. Well, tell me this. What baby step are you on? So I'm on baby step two. I have around $6,000 in credit card debt that I'm trying to pay off. Okay.

All right. So credit card debt. And you have the $1,000 emergency fund, correct? I do, yeah. Okay. All right. So you asked me, do you use that? No.

You're going to need to make sure that that's there at all times because what we don't want to do is to get in the habit and end up falling back right on the debt side of things this is a medical thing this is not an elective thing that you've done um so you know talking with them and walking through it you know if you if you told me chris i had the 3500 sitting around right and could just pay it then that's one thing but so it is going to be a matter of, again, you do have insurance coverage through where you're working and you know, you'll attack that as you walk through on the baby steps, you know? Um, and so, yeah. And, and, and again, you want to keep that there because the thousand dollars, if you,

let's say you, a car breaks down or something, I don't want you probably reaching for a credit card or anything going backwards. Does that make sense? Oh, yeah. Absolutely. And so, you know, I am so sorry that that happened to your arm, but I'm grateful that you do have an emergency fund, that you are aware, and you'll walk through this thing. And so, you know, yeah, be focused, and I wish you well as you heal. Again, you guys, America, life, having that emergency fund, excuse me, is so very vital to make sure that it's there.

But here's the deal. If you do end up using it because you do have an emergency with your vehicle or something, job one is to replace that money. You got to get it back. So those people that are on baby step number two, you want to make sure you're always at $1,000. You want to keep that money. You got to get it back. So those people that are on baby step number two, you want to make sure you're always at a thousand dollars. You want to keep that there. If you end up spending 300 on a car repair, guess what? Job one is to replace that. You always want to keep that at a thousand dollars. Once you walk through the baby steps and you get your debt attacked, then you move on to baby step number three and you build up a fully funded emergency fund of three to six months of expenses. That's the thing you want to make sure that always stays there as well. Now, people

will ask, well, how do you pick between three or six months? Well, if you have a longer term job and both people are working outside of the home and you have more stability, then a three month emergency fund is fine. If you are living, working a job where your commission sales or things are a little bit more iffy, then a six month is something that you definitely would want to focus on. So again, having that emergency fund is absolutely crucial and you want to keep it funded. All right, going back to the phones, I've got Ben on the line in Tucson. Ben, how are you? Good, Chris. How are you doing? Thanks for taking my call. Yes, I'm glad to take your call. How can I help you? Yeah, so I am going to be graduating college this next Friday, and I'm coming out of school

with about $19,000 or $20,000 in student debt. However, due to some financial problems and job loss a few years ago, my father, who is helping with tuition, also had to take out some loans. He has about $80,000 in parent-plus loans at the moment, and he makes a pretty good living. However, unlike myself, that I'm kind of trying to prepare to pay off these loans, he sort of spends his money and isn't as financially savvy as I think maybe he should be to prepare to pay off those loans. So I'm wondering if you have any advice for how I can help my father realize how important

it is to start focusing on those loans and what I can do to help him put himself in a better position. Gotcha. Ben, did your dad go back to school or are these Parent PLUS loans from your school? Yeah, they're Parent PLUS loans from my school. Okay, gotcha. Okay, so he signed on and so you don't think he's being responsible? I don't.

So the original plan was for him to help pay tuition. However, he lost his job. So in order to keep me in school, he decided that he was going to go take out these loans. I was very grateful for that. Right. Yeah, but now since I'm graduating school and I'm preparing to pay off my loans and seeing how difficult it is and how much work goes into it, I feel a little guilty and nervous for him that he might not be able to handle that amount of loans.

I got you. As you are about to graduate, congratulations on that. Do you have your job situation lined up? I do. I do, thankfully. Yes, I will start a full-time job in June. Okay, good. In June, what will be your income? I'll be making $46,000 a year. Okay, very good. And outside of the student loan debt that you have of $20,000, do you owe on anything else? I do not, no. Okay,

that's a good thing. The biggest thing would be you getting plugged in and making sure you're able to take care of of the 20 000 you have uh but you know again having a conversation with your dad and sharing the information about baby steps and working and budgeting and all that you can share that information but you can't make him do anything um and and that's you know it can be frustrating as you can imagine uh but talking with him to see but ultimately that and that's, you know, it can be frustrating as you can imagine, uh, but talking with him to see, but ultimately that's, that's going to be his call. So I think the best thing for you to do would be to make sure you put yourself in a position that you're paying yours off and talk about what you're doing. You know, let him know, Hey, this is what I'm doing. This is a progress I'm making. Maybe he can hear from you and see what you're doing and that will get him jump

started. But I want you to zero in and focus you on the 20,000. Uh, and he's got to make a decision about what he's going to do with the other half, you know? Um, yeah, you just, you can't make him. And it's the same, you know, you can imagine if a parent calls in and they've got an adult child that they want to get plugged in, they can't make them do it either. So we all get a chance to make our decisions. It's just a matter of having the right information. But I do think, Ben, you modeling it and talking about the progress that you're making as you're taking care of your side of that, I think it could be something that could spur him on to get him to move and to start to get a little bit more serious about his financial

future. I would also talk with him about his retirement dreams. Find out what does he want to do? What's the thing he's always been excited about doing? I talk about this on my website, ChrisHogan360.com. It's called the dream meeting. You know, it's where you help people start to think about what's the stuff you've always wanted to do?

Where did you want to go? Because people will tell me, you know, someday I want to do this or someday I'd love to go see that. And I've looked America at all kinds of calendars, digital paper. I mean, you name it. And I've never seen someday in the calendar. It's not a month and it's not a day of the week. And so there's no someday you worry, right? There's no some Denver. It's not on there. So it's a matter of us making decisions for ourselves. But again, nothing happens until something changes. And when we change our mind and we change our actions, we can also change our results. And that's what I want people to do is understand you have options in front of you. You've got opportunities to be able to grow further. So check it out. Go to ChrisHogan360.com. There's blogs on there. There's

information. I've got a YouTube channel where I've answered questions about helping parents and talking with them. It's a matter of us waking up and understanding we've got opportunities in front of us. We just have to change the way we think, right? Start to believe what's possible. But understand this, anytime you want something that's different, it's going to require sacrifice and also the courage to be able to pursue it and chase it down. This is The Dave Ramsey Show. We'll be right back. Hello, America. You are listening to The Dave Ramsey Show. I am Chris Hogan filling in for Dave. This is where we take your calls.

We talk about your money and your life. So if you've got a question, give us a call. That number to call is 888-825-5225. Again, that's 888-825-5225. Or if it's via social media, we'd love it for you to find us at Ramsey Show. You can send us your question there. Whether it's Twitter, Facebook, or even on YouTube, we'd love to talk with you. All right, I'm going to the phones.

I've got Tricia here on the line. Tricia, how can I help you? Hi, Chris. Big fan. My question is, we have a house in California, and we had to move to Idaho for five or six years, and we bought a house here. And when we move back in five years, and that's where we want to end up, when we sell this house, we'll probably have enough equity to pay off our California house. But I was wondering if maybe I should take that money and invest it in the stock market, like index funds instead.

Okay. So currently living in Boise, you have a home in California. You're saying you're due to go back to California when? In five years. Five years. So right now, California house, what's going on with it? We're renting it out. It cash flows positive about $900 to $1,000 every month.

Okay. And we have a stable renter, 18 months with an 18-month option to renew. Okay. And, you know, the house is worth probably $900, and we owe about $385 on it. Okay, good. All right. Go ahead. No, our house in Boise, we bought $75 below market. It went up 30% last year. So, I mean, it's going to probably pretty easily just with the influx of people here.

You have enough equity to pull out $400. Okay. So you think that you bought it for how much, the one in Idaho? $315, and it's now worth about $475. Okay. All right. So your question is, is when you guys get ready to move and you sell this Boise house to go back to California,

your question is, is should you pay off the California house or take the money and invest it? Is that right? Correct. Okay. All right. So the mortgage on the California house is how much per month? About $1,964, but with taxes and insurance, it's about $2,600. Okay, all right.

And do you guys owe on anything else outside of those two homes? No. Okay. Yeah, Trisha, I'm going to tell you this right now. When you guys get ready to move and you sell that Idaho house, I would absolutely, without a shadow of a doubt, pay off that California house. Okay. Okay. Yeah.

Well, here's another option. Do we keep the Idaho house? Nope. Do we have rental property? Nope. Nope. Nope. I knew you were going to go there.

I felt it. I did. And my hair on my head started to stand up. Chris, you don't want me to hear it. Hey, listen, don't you tell me about my head. I know. But here's why. Here's why. I love you tell me about my head. I know. But here's why. Here's why.

I love you guys got a good situation. You got a stable renter and everything in California. That's a good thing. Trisha, I don't like long distance landlording, right? Where you're not able. And let's be honest, Boise is not close to California. And, you know, and I want you to keep your things close enough that you can see them and you know but i i mean imagine you know imagine not owing anything you get back to california and

you pay that house off and you know you're going to be looking at that time probably at a 1.3 million dollar home paid off free and clear it's going to be a game changer for you you know and 2600 2600 not leaving you so yes sell that Boise house, definitely pay off your California house, and that puts you right smack dab at baby step number seven. That's where you don't owe anybody anything, and you're building wealth, and you're able to do some giving. That's how to handle that. All right, thank you for the call, Trisha.

It was great to talk to you. All right, I've got Ainsley on the line in Midland, Texas. Ainsley, how are you? I'm doing well. How are you, Chris? Oh, I've got Ainsley on the line in Midland, Texas. Ainsley, how are you? I'm doing well. How are you, Chris? Oh, I'm focused and not finished. How can I help? Well, I have a question about making an insurance claim.

We got one of those West Texas hailstorms last week, and it beat my car to death. And, of course, I made a claim. It's a 2008 Toyota Avalon, and we don't owe anything on it at all, and it has been in really good shape up until last week. It even looks good. But they gave me two options, and they said, we can take the vehicle and give you $8,900, or we can let you keep the vehicle and we can give you $6,700 to get the repairs done.

And so I'm kind of at a loss of what to do. It is one of the only cars that we have fully paid off. We have no other debt other than our Jeep, which we do owe about $15,000 or so on. But other than that, I don't know whether we should try to fix the vehicle just because it is paid off, or should I, you know, take the money and try to purchase something new? Right. Well, here's the thing. The hail damage, that's cosmetic, correct? Yes. Okay, so the car is still running?

Oh, perfectly. Okay. I mean, you put the key in, you turn it, it turns on, it gets you where you need to go. Smoothly, yes. It's very reliable. Yeah, no. And so, I mean, in looking at this, they send you, they give you the two options. They come get it and give you a check for $8,900, or you keep it and they send you a check for $6,700, correct? Right. Okay. Well, I'm doing the math here, and you told me you owe $15,000 on a Jeep.

This Toyota's paid for, so I'm going to get the $6,700, and then I'm going to turn around and send that toward the Jeep for the $15,000 to knock that down. Do you see where I'm going with that? And not even worry about the cosmetic damage? No. It's running. And so that doesn't matter, like, on future claims, does it? Like, oh, you've already claimed against this vehicle, and we totaled it.

It was a hailstorm, right? I mean, you can check. Yes. But, I mean, in looking at this, I mean, you know, you and I both know if you were to take it to try to get that fixed, the pulling out the dents, and I don't know how bad it is, but, yeah, if they're sending you that, and the claim is totaling it, then they're sending you that dollar amount. It can't make you go get that fixed. Okay.

Yeah, no. And if it's running perfectly and it's just cosmetic stuff, I mean, I don't know about you. I mean, I'm looking at this going, all right, what's the smart use, right? Yes. And I'm in our relationship. My husband is the spender and I'm the saver. And so I immediately think, oh, well, this car still works perfectly

and it's reliable. I want to use it as long as possible. And he said, let's go get something new. And I'm like, but we have this Jeep. There's too much on the plate already. Because I don't like that. We have no student loans. We have no home debt.

We have no credit card debt. The Jeep is the only piece left. I don't want to add on any more. No. No, adding on something is not an option. Right? That doesn't move you closer to your goals. It moves you further away from it, actually.

Exactly. And so, you know, and again, you know this. Your husband's the spender. And he sort of gets excited about it. And you're wanting to make sure you guys are zeroing in on, hey, what do we want long term for ourselves? And so I'm proud of you for resisting that because everybody gets excited about getting something new. You know, I mean, everybody loves that. People don't get excited about the payment, you know, that comes associated with it.

So I like the idea. If I'm in your shoes, I'm going to tell you right now, Ainsley, I'm keeping that vehicle that's running just fine with a little cosmetic dents in it. It'll be okay getting me from point A to point B so I can stay focused and I don't want to go backwards. So that's what I would do if I'm in your shoes. All right, going back to the phones, I've got Talia on the phone. How are you? Hi, I'm doing great. Well, how can I help you? Hi, I'm a senior in high school, and I am planning on going to ASU for my undergrad with full tuition. Okay. Yes, ma'am. And then after, I'm planning on going to medical school.

Okay. And I just want to know what's the best way to cash flow that Using what I was supposed to spend on my undergrad. All right. Well, I'm proud of you. My goodness, who taught you about money? Your parents? Yes, they're entrepreneurs, and they start from nothing, went up, and I listen to y'all's podcast every day.

Fantastic. Well, I'm proud of you. Talia, what I want you to do is to really make your second job very focused on looking for scholarships and grants. You know the path that you're going to take. You know the direction you want to go and what you want to do with your life. I want you to know I want you to remain allergic to student loans. That's not an option.

That moves you further away from what you want to do. So be intentional. Be focused. Look at scholarships and grants options that are out there. Someone that's young and as smart as you, you've got opportunities. And I'm proud of you. Being a senior in high school and focused and talking about money, that's a game changer. Puts you on the path to have a different kind of outcome.

Well, listen, I want to thank James Giles, my producer, associate producer Kelly Daniel, and you, America, for all the calls. This is The Dave Ramsey Show. This is James Childs, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe today.