The Ramsey Show - App - Should I Move Out of My Parents’ House? (Hour 3)

Episode Date: October 11, 2022

Dr. John Delony & George Kamel discuss: When it makes sense to buy a second vehicle, Preparing to move out of your parents' house, What to do when retirement plans change, Counting HSA contributions toward baby step 4, Why credit cards aren't smart. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Лавровый путь Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, this is The 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. Here on the Ramsey Show, America hangs out to have a conversation about your money, your life, and I'm stumbling through the intro here, George. You're just so nervous to be co-hosting with me, John.

It happens to the best of us. It's hard to sit in the shadow of your excellence. It's such a small shadow. It's amazing. That is true. I should stand up. It's impressive on its own true. I should stand up. It's impressive on its own right.

I'm John Deloney, joined by George Campbell, and we're taking your calls, 888-825-5225, and I hope to not stumble through your calls. Let's go to Liz in Mobile, Alabama. What's up, Liz? Hi, John. It's so good to talk to you again. It's supposed to be about a year ago, and I'm in a much different place in life now, so I'm happy to report that, but I've got a question for you. Tell me about your journey. What's happened over the last year?

I don't know anything about it, Liz. Give me the spark notes. About a year ago, I was at a place where I was escaping domestic violence with my five children. Had nowhere to go, had no income, had been a stay-at-home mother for 15 years, was living in a camper in my friend's backyard. Yes, I remember you, Liz. Okay, thanks for calling back. Where are you now? Hey, well, you know, the kids and I are healthy and well.

I am a full-time student. I'm going into nursing. Wow. I quickly found out that, you know, there's no entry-level job that you can get that really supports a family this large. Right. So I'm going after my dreams that I abandoned all those years ago. Liz, I'm so proud of you. What a gift for you, your community, those people you're going to serve, and for your kids. You are a real life, no, hold on, you're a real life model of what it looks like to get knocked down and get back up. We teach our kids that.

We read them children's books, and we talk about it. Your kids are going to have a picture of it. I hope so. You are incredible. That's my greatest hope. Good for you. All right, so how can we help you today? Nothing is not for God who goes before me,

because I tell you he's been there every step of the way. When I said, I don't know how I'm going to pay bills or how I'm going to pay rent. It was there, you know, through no doing of my own, his people and his hand have just been all over our lives. It's just been a miracle. But the big money question that I'm looking at right now is I'm still in a place where my income is less than my outcome. As less than, you know, I'm making far less than what I'm spending. And luckily I do have a substantial savings right now, as it were. But I drive a very large vehicle with the kids. And it gets terrible gas mileage. I've been looking into getting a second vehicle, um, because the, what I'm doing for work now is

delivering, um, you know, either packages or, you know, food delivery, things like this that I can do outside of school hours. It provides me the flexibility and schedule and things come up with the kids. So it's a good couple of hustles to have. So I like having, I like having, you know, the big band for when we need to go places, I need to have all the kids with me or what have you, but it's so bad on mileage that I'm considering dropping $3,000 or $4,000 into a decent, reliable, smaller vehicle for when I don't need to have all the people with me, and that can still give me the availability to haul all the packages I need to do my job, but also be a more efficient daily driver. Could you split the difference? Could you sell the bigger bigger car get a smaller one that still fits the kids that's um the issue is uh not

i i feel like if we got something smaller and got entirely rid of the larger vehicle, it would be difficult. I happen to have really, you know, my older two are quite tall now. It's not super feasible to get everybody into, you know, like a car. How tall are these kids? I'm genuinely curious as a small guy. My two teenagers are, you know are six feet and six-two. Represent. Yeah, those are giants sitting next to George. I wouldn't lose. I wouldn't.

My worry partially is what happens when both cars need repairs, and now you're paying insurance on two cars, and what you thought was going to be a benefit is now more of an expense. Buying $3,000 or $4,000, okay, let's say you did the math on, here's what the gas mileage is, here's what I would save, here's that gap. I could actually make more money if I had a $3,000 or $4,000 car. Great, that math is fine. George just brought up a great point.

You have to bring in the math of the extra insurance and the extra, that's another oil change, another set of tires, another set of, all those things build up and up and up and up. So at one point I had an old truck that I was going to rebuild with me and my son. Disaster. I don't know if you've, we've never met, but I'm not a, I'm not a rebuilder. Um, and I kept my wife's Corolla as just a paid off car that we had in the driveway that could be my daily driver. And then I, after paying the registration, the oil change, I realized my free car was costing me a big chunk of money every month, annualized over the course of a year. And I realized, oh, this isn't so free at all. Right. So I ended up getting, I isn't so free at all. Right?

So I ended up selling it because it never made its money back on the gas. How close are your kids to driving? That's the other consideration I was going to bring up. We're months away. So teaching them to drive on a 12-passenger van is not ideal. You know, you don't want to learn to drive on a loaf of bread. No, it's fantastic, man. Are they saving for a car?

Oh, yeah. I'd love to take them parallel parking. That'd be a riot. Yeah, and hey, you don't have to worry about them dating. That's going to be fantastic. Well, you know, giving a kid a van can go the other way, too. Oh, there you go. You don't want to turn a teenager loose.

That was my first car was driving mom and dad's minivan. It's awesome. Well played, Liz. Well played. So I'm just wondering, can the kids save up, and maybe you match them and you get a car, and maybe you can use it for your side hustle until they're fully driving and out of the house a little bit.

Is that a possibility? Have they been saving up for a car? Yeah, it's been saving up a little bit. He's in school full-time playing sports at a private school as well, which is another. Oh, boy, that's the real expense in your life is private school. Yes, absolutely. Yeah, a faith-based private school.

So we're just, you know, it's everywhere. I'm just so thankful. But he has, you know, he's not able to work a whole lot. He does his own business. He does lawn care and odd jobs and things. Oh, great. So he can save up $3,000 over a year? Yeah, possibly. I mean, I would certainly expect him to, you know, cover insurance, you know, gas if he's driving full time. I think that would be a fair expectation if I were to purchase a second vehicle. Okay.

What are you doing with school? Either way. It's going to be about two years. Okay. Maybe a semester less, like, you know, three, four more semesters. Cool. Well, this is all temporary, so I would find a temporary solution, and that might mean you buy a beater car and you give it to the kid later on and he buys it from you but the a1 is getting to a financial place

and that worries me to have all of these extra expenses I would probably just keep the van and let that and every time I fill it up at night I would let it inspire me to keep grinding and get out of this mess but that's's just me. I love it. We'll be right back. this is the Ramsey show 888-825-5225 I'm John Deloney joined here by George Campbell and we are taking your calls on life, money, work, mental health, relationships, all of it.

888-825-5225. Let's go to Nick in Atlanta, Georgia. What's up, Nick? How we doing? Good, how are you? Outstanding, my man. What's up? Hey, so I'm 23 years old, and I'm sure this topic has been covered covered before but i was just

looking for insight on you know moving out of your parents house you know which one is more important kind of you know saving up the next day just because it'll be my first you know venture um in a you know expensive apartment or would it be you know paying off debt very cool man so um you have a job i do yes um i made 50 000 fantastic man what are you doing i work at enterprise the car rental business yeah good for you man cool and what is now causing you at 23 to go all right i've had enough i'm moving out um nothing major you know it's really good here here. It's just I kind of want that independence and creating something for myself. Very cool. And you're in Atlanta proper? I am. And what is rent right now in the areas you would want to live in?

It's looking like around that $1,500 to $1,700 ranch or somewhere, not even just luxury, but safe, I would say, because Atlanta is kind of used to a different type of city. So I would say, you know, somewhere safe and prosperous, about $1,500 to $1,700. And what is your take-home pay every month? What ends up in your bank account? About $3,000 after taxes. And so we're talking about over 50% of your income going towards rent if you move out today.

Yes. Does that not fright if you move out today. Yes. Does that not frighten you? It does. That's why it's just like... Why is he calling us, George? Well, I'm trying to just open up some options here. Could you get a roommate? I could.

That could work. I'm going to rephrase that. You have to get a roommate. I'm sorry. I didn't mean it as an option. This is part of..., here's my thing. You talked about independence and the truth is right now we can't afford full independence. We're going to have someone else living with us regardless. Sure. And so the question is, do you want it to be a stranger or your family? I get it.

You want to get out. You want to feel like I'm a grown man, you know, leaving the nest. And I love that. Uh, but you're going to have to get a roommate in order to afford living where you want to live. Definitely. That's the bad thing about living in Georgia. So that's part of it. That's something to grapple with, is you're going to have to vet and find a reliable, safe, trustworthy roommate who pays on time, you get along with at some level. So that's part of the picture. The other one is all of the other expenses that come along with that. You're going to need to get renter's insurance. You are now not able to eat dinner at your parents' house every day. So you're going to have to learn how to cook because going out to eat every day is going to make you broke. And we're not going out to eat

because we got some debt to pay off. Is that right? Very true. Okay. How much debt? About 50 grand in total between school and credit cards. Nick, hot dang. What are you doing? What was your degree in? I got it in sociology. Oh, Nick. If we could turn back time, Nick.

If I could turn back time. We sing or else we cry. That's right. So, Nick, if I'm you'm you well let me just tell you i'm just gonna be honest i've never told this story publicly george um nervous and excited at 21 i was at my parents house after graduating college um and i had a chance encounter with an old uh track coach i ended up taking a job as a high school teacher and coach in the Houston area. And I lived, I was going to live with my parents for a while and pay off my

student loans. Within a month, my dad was like, Hey man, what if I paid your first month's rent? And I was like, I'm already out of here. And if I had to do that all over, I would have stayed there until I was debt free. Yes, very true. By me not taking two years to take care of my business, I went and bought the biggest stupid truck I could. I went and got a nice apartment. I just lived beyond my means. And I wouldn't recommend doing that. I wouldn't run out of my mom and dad's house until I was debt-free.

What are your monthly payments, Nick, between the student loans and the credit card? Probably about $300. That's it? No, no way. That feels way too low for $50,000 worth of debt. I haven't started paying all my student loans yet.

Based on what I'm hearing is life hasn't actually happened yet. Life's about to hit you in the mouth, dude. When those student loans get unpaused, it's going to be a harsh reality, my friend. I'm so glad you called us because you were about to go sign a $1,700 a month lease. For 12 months. For 12 months, and then you're going to start paying back student loans. You're going to realize you have $11 left over after just expenses. And then you're going to have to break the lease, pay the fees, and then move back in with mom and dad with your head hung low. So I'm not in the boat of like you have to pay off all the debt before you leave the house,

but I do think we have to think long and hard about how we're going to do this. And maybe it's an exit strategy of, hey, I'm going to pay off as much debt as I can aggressively. I'm working overtime, and a year from now, I'm going to move out, and then I'm going to get a roommate, and I'm still going to work overtime, and I'm still not going to be eating out because I want this debt gone. Very true. That's the goal. And so I love that you want to be independent. I think that's a great thing. It's going to do a lot for your dignity and for your spirit. But right now, it's going to be a burden and a curse if you just jump ship today. Very true.

So make a plan. Here's the deal. We're going to send you Financial Peace University, okay, as your graduation gift. We're going to send you every dollar app too so you can begin tracking your money. You can practice making a budget and maybe get your parents to watch these videos too with you.

Get some buddies together and watch them. And I want you to watch all these things. We're going to send them to you, okay? I'm going to give you a year of the apps. You can start tracking your money. I want you to begin to live in or own or acknowledge whatever word you want to use. You've got to live in reality and you want to be independent. You want to jump off. I do. I'm all in. I've been there. I totally get it. And you simply have put yourself in a financial position where you can't afford to do that yet responsibly. You could if you had to.

You'd end up in a part of the community, like you mentioned, that you don't want to live in or you're going to have to have two or three roommates and you find yourself, man, I wish I just had mom here. At least she cooked dinner and did my laundry sometimes. My roommates don't even do the dishes. Yeah, it's the inverse. It's disgusting. They let things soak instead of putting them in the dishwasher.

But I had roommates up until, just about up until I was married. I did, absolutely. And it's just a part of a financial reality. We know we live in a very wealthy county, and so to live anywhere near here, you're looking at, you know, it used to be $800, $900 for a two-bedroom in the general Nashville area. Now it's $100 million. Now it's, yes, $4 billion, and that gets you a,

it's like a New York studio apartment. That's exactly right. So it's just part of the reality is I don't want to do this, but I got to get a roommate because I have financial goals and I can't meet those goals. If I have all this debt hanging over my head, my payment is gigantic. So here's the common thing when people have to face reality. I didn't mean, Dave and I've talked about, I didn't mean to put on 40 pounds during COVID. It happened, right? Here's where, this is reality. I didn't mean to look up and sell them $100,000 in debt.

It happened. I didn't mean to, wait, I've gone three weeks and me and my wife haven't had a meaningful conversation or I snapped at my kids. There's something about not looking to blame, not looking to run out and be like, just exhaling and looking in the mirror and saying, run out and be like, well, it's big. Just exhaling and looking in the mirror and saying, you know what?

This time this one's on me. Yes, I did what I was told. Yes, my parents told me to go to college and take out big student loans. Yes, I just was told after college, you're not coming back to this house. And so I went and got an apartment. I did it. I signed my name on that line. I listened to bad information. I did the best I could with what I had.

But here's where I'm at. This is my reality because only then can you ask yourself that scary, terrifying question of what am I going to do now? Right. And there's a season for most of us of grief. I didn't mean for this to happen. I didn't know this was going to happen. I didn't understand what this was going to feel like when I got here with a, golly, I mean, can you imagine Nick is millions and millions and millions of us, right? Who, man, I'm making 50,000 bucks. I'm making great money, especially for my first job. I didn't make $50,000 at 23, right?

And surely I can get an apartment and a car and food and go hang out with my friends and go to concerts. Nope. As part of the narrative, we tell our kids. Not if you owe 50 grand in student loans and you have a car loan and you've got a credit card. I mean, you can't wait until I'm an adult and I can live on my own. And then you realize, I can't afford to do any of this. Or I'm going to eat Taco Bell every meal.

And then your digestive system has a stake, right? We think this is going to be this way. It's just not. You've got to own reality and you've got to grieve it. Man, I didn't mean for it to. And then you've got to say, okay, what do we do next? That's where Financial Peace is so great. Absolutely.

Hang on the line, Nick. We're going to make sure to get you Financial Peace University and EveryDollar. Get you on a plan. I can't wait for you to call back two years from now and be like, I'm completely debt-free, living on my own. We did it. I did it. Thank you. This is the Ramsey Show, 825-5225. I'm John Deloney, joined here by George Camel. Listen, right now is the time of the year when it's make or break

when it comes to our goals. We're heading into holiday season and I don't care who you are. It's hard to stay motivated when it gets cold and it's dark in the morning. It's just hard to get up and get going. We all have goals, whether it's to find a better job, make more money, pay off debt, build stronger relationships, and it can be hard to get momentum going and to keep it going. But here's the good news. Coming up in a couple of weeks, we have one of our biggest events, Smart Conference. We're headed to Dallas for a day-long jam-packed event where you'll get advice from leading experts on money, personal growth, career, mental health, and your marriage. You'll leave with all the knowledge and motivation you need

to reach your goals and live the life you want. Join Dave Ramsey and the rest of the Ramsey personalities, including me, Ken Coleman, Christina Ellis, Rachel Cruz, even George Camel. Appreciate the invite. George Camel got invited. And we're also going to have Craig Rochelle and his wife. There's a bunch of people. It's going to be a blast.

We're going to have live music. It's going to be an all-day event. Join us live in person on October 22nd to get your passes before they sell out, and it will sell out. Visit ramseysolutions.com slash events to get your tickets today. Very, very cool. It's going to be a fun one. I'm looking forward to it, man.

Live band. We're going to audition to try to be in it. We'll see if they'll have us. I think it's going to be no chance. Okay. No chance. All right. Let's go to RJ in Spokane, Washington. What's up, RJ?

Hi, thanks for taking my call. You got it. What's up? I have a question. So my husband and I are about 60 years old, and due to the circumstances, or some circumstances with COVID, we had to shut down our business and retire five years earlier than expected. So in the meantime, we have no income for the next five years until we can draw social security. And I am looking for guidance or advice on ways that we can make the money we do have last

until we're 85, 90 years old. Can I ask you a hard question, RJ? Sure. So this is, I want you to picture me and you having some nachos, me and you and George sitting at a table just hanging out. Okay. This isn't me like pointing my finger at you. Okay. Okay. You and your husband had to close your business, but you did not have to retire early. And you may have had five years of doing jobs that you hated or didn't like. I was with my mom this weekend and she called about a year and a half ago and said, hey, I'm thinking about retiring. And my first question was, can you afford to retire? And that sounds like a question y'all didn't ask yourselves. It sounds

like you just jumped and retired early. Why'd you do that? Well, we couldn't find help. We couldn't find workers. And so we were in an accident like 10 years ago, and my husband really is no longer too. He was a very hard worker, and he just is no longer to be out on the job site. I watched my grandkids, which is no, I mean,

I could go get a job, but I've raised my kids. Now I'm just kind of watching my grandkids and, um, yeah, I could, we could get a job, I guess.

Um, making minimum wage. Why minimum wage? Why would you, why would you say that about yourself? I'm old. We're old. I don't care. This is one of the hottest job markets,

the hottest job market ever, ever. I just talked to a 58-year-old. He was making $130,000 working in IT. There's no such thing as, well, I'm 60, so I have to do minimum wage jobs. You have amazing experience. For all of that, and we couldn't find workers. do minimum wage jobs. You have amazing experience. For all of that, we,

but all of that and we couldn't find workers. You know, I mean. Okay, but that was a, that was a couldn't several years ago and now we're here right now

and let's look at it this way. You had a season of, we had, we have to shut this thing down. Nobody will work or nobody can work. The city shut down. We can't afford payroll.

We can't afford to keep our business going. We're closing the business. Honey, you can't get up and grind it like you used to. You put in like 30, 40, 50, 60 years of grinding it out for the family. We can't do that anymore. Okay, so here we are.

You really want to raise your kids and then raise those grandkids. And I want to give my kids relief right now. The reality is if y'all run out of money at 87, your kids are going to pay that bill. Fair? Yeah. Yeah. And so I think the greatest gift you could give your kids is to say, Hey, we can't afford to do what we're doing right now. We have found ourselves in an unsustainable. We're looking at the numbers down the road. This is unsustainable.

We're going to have to do something different. And I want you to set your goals way higher than minimum wage. You've got incredible value to offer. And I have no idea even what your job was, what you can do. I know, though, you've got too much experience to just walk in and say, well, lowly me, nobody wants me. No way. You already keep kids. You can open a daycare in your home and make a jillion dollars because we paid childcare before. They basically print money, right? I don't know. I don't know what your skillset is. I don't know what you want to do. But that's my first, that's my first initial question is why have you just said this is the way this has to be for five years?

And how do we stretch this and do this? And oh, no, I don't know how it's going to work. It sounds like you have a picture of the life that you want. And you're trying to make math that doesn't work fit that picture. And you're going to make yourself bananas and you're going to find yourself broke at 85 years old. Well, but I'm hoping what we do have won't, so I won't see that scenario. That'd be great. Hit us with some notes.

So what do you got? Yeah. Watch it. She's going to say I've got $11 million and I'm going to feel like an idiot. Go ahead. Waste all this time. Go ahead.

But I want you to know we were married young. We have been very poor. So we've worked hard for what we have. So we live frugally. You know, I mean, we don't drive big fancy cars or anything like that. But this is what we do have. So we have about $500,000 invested. We have about $300,000 in checking savings account.

Our house is worth about $800,000 in checking savings account. Our house is worth about $800,000 and we have probably a little over, but right about a million dollars in land and real estate that we've acquired over the year, which every year can rise or lower. You know, you just don't know, but right now it's that. And then we have about $200,000 kind of stashed away in cash that my husband just like to keep on hand. So physical, physical. Okay. Yeah. Okay, so you have a couple million dollars. RJ, lead with that.

Lead with that. What's the $500,000 invested in? You know, it's with an investor that, I know it goes by the S&P 500. Oh, it's not retirement. Is it just an index fund? Well, it kind of is. Well, it's no kind of. Either it's a retirement account or it's a non-retirement account. No, it's a retirement account because when we're 65, it will pay us money. Oh, no. Is this an annuity? I don't know exactly what it's called.

It's through a Dave Ramsey investor that we found. Then it should not be an annuity then. I can't remember what it actually is called. An annuity is a contract with an insurance company, and then it pays you a fixed income later on in life. That's what it sounds like you're describing. But no smart investor from our company would recommend that. Okay.

The home is paid for, the $800,000 home? It is. Oh, wonderful. Although I do have another question on that down the road. But everything is paid for. We owe nothing. We have, we have no bills. Um, and you guys are going to be fine. You're fine. Now, if you are,

are you RJ? Sorry, George. 60. 60. Okay. So if you worked with a smart investor pro and you said, Hey, listen, I want to, we want to have this much, this kind of lifestyle. We want to pull, I don't know, 80 K a year, let's say. Then we would go, all right, well, we do 25 times 80. And that would kind of give you your magic number to tell you, this is kind of what you're looking at. If you want to pull 80,000 a year, you need $2 million in that account to withdraw from at about a 4% rate so that it can continue to grow. That's called the Trinity Rule. And so I would probably, I would consider maybe selling this land in real estate if it hasn't been doing that great, and you can get a million dollars and go ahead and invest that and invest this 200,000 in cash

that is just burning a hole in the ground and can't keep up with inflation. Put that in a high yield savings account even and make two and a half percent on it. So I just don't want you sitting on the sidelines because you're fearful of, are you going to have enough money in retirement? So go ahead and touch with a different smart investor pro. I don't know who you're working with and get a second opinion on all of this money and all these numbers so that it can work for you. And let's get a, let's get a map, a direction. Here's where we're going. Here's how much money we need to get. And here's what it's going to take to get there. And let's don't work in clouds and fantasies okay let's get some real numbers today's scripture of the day is from leviticus 114. But if his offering to the Lord is a burnt offering of birds, then he

shall bring his offering from the turtle doves or from young doves. I don't know what that means. Jace Robertson from Duck Dynasty says, Doves are the filet mignon of the sky. That is a great quote. It's a lot of doves.

So many doves. A lot of doves. So many doves. A lot of doves. A lot of doves. Are they trolling you? I think I'm getting trolled. Okay. I think I just got, it's dove season, I think I just got trolled. With some old school Leviticus.

Well done. Leave it to Leviticus to roast you. Leave it to Jace Robertson. All right, let's go to Michelle in Birmingham. What's up, Michelle? Nothing much. How are y'all? Excellent.

How are you? I am surviving a cold, but a quick question for you. Good. We'll get better soon. What's up? Thank you. Can I make contributing to my HSA a part of my 15% going to retirement. It's not a part of the 15%. I want you to contribute to that, but it wouldn't be considered retirement

because it can only be used towards qualified health expenses, and it can't put food on the table. It can't really do much other than cover some health care. Gotcha. And so I would invest 15%. Are you in baby step four? Are you out of debt completely and have a fully funded emergency fund?

Yes, I do have that. Okay, great. So beyond the 15%, if you want to contribute to your HSA, it's a great investing vehicle because the money goes in tax-free, grows tax-free, you can withdraw it tax-free towards those qualified health expenses. And you can put as much in there. There's some limits, but past about $1,000, at least in ours, you can invest that money.

And so it can actually grow for you tax-free as part of an overarching retirement plan, but it's not part of the actual 15%. Oh, okay. Awesome. Yeah, great question. It's part of an overarching retirement plan, but it's not part of the actual 15%. Oh, okay. Awesome. Yeah. Great question. Have enough in there to cover your deductible. It sounds like you're crushing it.

Yeah. Way to go. Even with the cold, still crushing it. Yeah. Awesome. We'll get better soon. Thank you so much. Hope you feel better soon.

Let's go to Almir in Minneapolis. Minneapolis. I always say that wrong every time. What's up, Almir? Hey, can you guys hear me wrong every time. What's up, Almir? Hey, can you guys hear me okay? Absolutely. What's up, man? My question is about you guys' credit cards. I know you guys are

not for credit cards and I understand why. Can you speak a little more clearly for us, Almir? Talk into the microphone there. Can you hear me? Into your phone. Can you hear me better? Perfect. So I know you guys are against credit cards and i understand why but i shouldn't say i figured out a system but for me i have all of our recurring bills that we have to pay for every month whether it's tithe the daycare electric gas on a credit

card which stays in a safe account and then every month when my credit card payment is due which i pay anyways i pay it off every month and i would get 50, sometimes a hundred dollars in reward points every month. Is there a negative to that or is it a positive? I use that $1,500 to reinvest in some certain ETFs or stocks on Robinhood. Well, I don't know what plan you've been following, but it's not the Ramsey plan and that's fine. It sounds like you're doing great financially. You're out of debt completely. You've got a fully funded emergency fund. Yeah, I'm out of debt.

I have a fully funded emergency fund. I have 15% need between our household income put away. I'm on a 20-year loan for a 20-year term for a mortgage. So I'm doing all the steps. And I know that the one big step is no credit cards, but I just found that something that worked. I implemented a few years and I'm building wealth out of it. Sure. Well, we would never tell you to invest in single stocks. And I did a whole episode on the Robinhood app on my podcast to find print. So if you want to learn more about that, you can check that out. But the credit card dilemma that you're bringing up is one that we

get a lot. And everyone that brings it up is going, listen, I get it. People can't control their spending, but I have mastered it. I have figured it out. I never spend a dime on interest. I get my cash back. I am winning. I'm beating the system. And at the end of the day, it's not moments like that where you lose.

It's the moments where life doesn't go exactly according to plan. And now all of a sudden we have to put those on the credit card because we had an emergency that exceeded our income and we don't know what to do now. And life kept punching us in the face and we went, well, at least we're still getting the cash back rewards. And so truthfully, I think you can do a lot better just spending with a debit card when you use your own money. And I understand you're putting recurring bills that you normally would spend on, right? Mm-hmm. That's it. But psychologically, we make different decisions, number one, with other people's money, and number two, with that kind of reward-level thinking.

And, Almir, I was in your exact shoes, okay? I had recurring bills put on a credit card that got me free flight points, and I never was going to be in debt again. I paid it off every month, and all was good. Let me tell you why I quit, okay? And I don't think any of the rules apply to me, and I always think I'm the exception, right? So I'm like you.

Never going to have a problem. I've got an emergency fund. I'm not worried about ever going into debt again. I'm just, I'm just going to take their free money. Here's why I quit. I was beating that system. If you will, I was playing their game and I was doing fine. You are too, but somebody's paying that $1,500 a month that you take home. And you know who it is? It's the single mom with four kids that can't eat. And she's paying for your Robin Hood account. It was the guy who just got fired and couldn't buy groceries, and so he had to put on a credit card. That was the dude who was paying for my flights at 30%.

And I couldn't stomach taking a free flight off the backs of people who had hit rock bottom or people who had legitimate issues psychologically with controlling their spending or whatever. I opted out of that system because it's disgusting. And I don't want that free flight. I'll pay for my own flights.

I'll figure it out. Does that make sense? That makes sense. That's why I opted out of it, man. The whole system is so predatory off those who are struggling, who don't know any better or who are found themselves in a mess where their rent just doubled and they live in a city they can't afford and they can't get a new job in one day. Well, I've got you. I got you covered at 30%, at 28%. And if you miss a payment, it goes to 40%. And by the way, you can never borrow. I'm just out of that system, man. Because somebody else is paying for my flights. That's why I got out. Yeah. I'm curious, Elmir, how much are you spending a month to get 50 bucks

back? So here's, I have a two-way system. One of my systems, so I started this a few years ago and I think the biggest thing is discipline. I'm a very disciplined person. I mean, I'm an immigrant as well. I've seen my parents in debt and I see what credit cards can do. I've trained myself to never be in debt and I never will. But like I said, I have recurring bills that get charged, like my tie, my daycare, all those things'll get charged in our account. Then I do the day range of the envelopes. And then in one of my envelope systems, one of the envelopes says return a credit card payment. So we have two credit cards, one of them is a smaller one. So if we buy groceries, I'll put groceries in the credit card. I'll transfer that money from that envelope to my... So I always... They're always balanced. You just have to be disciplined.

This is some fancy footwork you're doing, man. And my parents are immigrants as well. My dad is from Egypt and I watched him do this growing up and it's giving me PTSD to hear about it because I know the anxiety of, oh my gosh, we had to move the 0% APR to this card to get this reward. And it's bonkers, man. So you do you, but man, it's so much more peaceful to do the Ramsey way. Yeah. I'm opting out of the system. I'll pay the peace tax is is what I call it. Absolutely. I'll lose out on that 50 bucks to not have to deal with it, man. But thank you so much

for the call, Elmir. Hey, real quick, Pods giveaway. We know a lot of you are planning on moving soon, and we got great news. Our new studio sponsor, Pods Moving and Storage,

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That's pods.com slash Ramsey. And dude, I was just thinking. I love that. When I moved, I would have loved this system. I didn't even know it existed, man. I'm so excited about this. It's awesome. Great company, great leaders over there.

Well, hey, thanks George Campbell for co-hosting the show. I'd like to thank all the guys in the booth. And thank you, America, for staying with us and hanging out with us. Be kind to one another, and we'll see you soon. Hey, it's John Deloney, co-host of The Ramsey Show. Did you know over 18 million people listen to The Ramsey Show every week? A lot of those people listen on one of our 600-plus radio stations across the country. To find a station near you, go to RamseySolutions.com slash show.

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