The Ramsey Show - App - Solve for Peace Instead of Screwing Around With Debt

Episode Date: August 20, 2025

🎟️ ⁠⁠⁠The Ramsey Show Live Tour: Get Your Tickets! ⁠⁠ Dave Ramsey and Rachel Cruze answer your questions and discuss: "Should I invest into real estate instead of paying off my student loans?" "I'm drowning in debt and don't know what to do..." "Should I be allowed to spend $5-8,000/year on my sailboat when my wife says our kitchen needs remodeling?" "Are we obligated to give our dad money?" "Can we afford a $4,000 monthly mortgage payment?" "When and how do we give our kids access to the money they've earned on YouTube?" "My husband opened a credit card in my name and then passed away. Can I get out of this debt?" "I'm 38 and have nothing saved for retirement..." "Should we be investing more than 15% to compensate for my wife who's a stay-at-home mom?" "I drained my 401(k) to pay for my kids' college. I'm scared that I now have to start over with my retirement savings" Next Steps: ✔️⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠Help us make the show better. Please take this short survey.⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 📞 Have a question for the show? Call 888-825-5225 weekdays from 2–5 p.m. ET or⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠send us an email⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. 📱 ⁠⁠⁠⁠⁠⁠Get episodes early in the free Ramsey Network app!⁠⁠⁠⁠⁠⁠ 📈⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠Are you on track with the Baby Steps? Get a free personalized plan.⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 🏠 ⁠Get organized and prepared to buy or sell a home. ⁠ 💵⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Start your free budget today. Download the EveryDollar app!⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 🤔 ⁠Will an online will work for you? Take this quiz to find out⁠ Connect With Our Sponsors: Stop paying more and start shopping smarter at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ALDI⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Get 10% off your first month of⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ BetterHelp⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Go to ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Boost Mobile⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ to switch today! Learn more about⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Christian Healthcare Ministries⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Get started today with⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Churchill Mortgage⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Get 20% off when you join ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠DeleteMe⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Go to⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ FAIRWINDS Credit Union⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ for an exclusive account bundle! Find top health insurance plans at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Health Trust Financial⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Use code RAMSEY to save 20% at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Mama Bear Legal Forms⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Visit⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ NetSuite⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ today to learn more. For more information, go to ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠SimpliSafe⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Use promo code RAMSEY for 18% off at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Nokbox⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Get started with ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠YRefy⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ or call 844-2-RAMSEY. Visit⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Zander Insurance⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ for your free instant quote today!  Explore more from Ramsey Network: 💸 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Ramsey Show Highlights⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 🧠 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Dr. John Delony Show⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 🍸 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Smart Money Happy Hour⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 💡 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Rachel Cruze Show⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 💰 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠George Kamel⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 🪑 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Front Row Seat with Ken Coleman⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ 📈 ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠EntreLeadership⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ramsey Solutions Privacy Policy⁠⁠⁠⁠⁠⁠⁠

From the headquarters of Ramsey Solutions, it's the Ramsey Show. We help people build wealth, do work that they love and create actual amazing relationships. Rachel Cruz, Ramsey Personality, number one, bestselling author and co-host of the Smart Money Happy Hour hit on Ramsey Networks. My daughter is my co-host today. Open phones at AAA 825-5-225. Jim is in Connecticut. Hi, Jim. How are you?

Hey, how's going? Better than I deserve. What's up? So I have a question. I've been listening for some time now, and I haven't heard this question answered. So basically, we have about $90,000 in student debt, and we have the money to pay it off. Good. But my question is, so I have a friend that's in real estate, and he basically is telling me to get into real estate with that money rather than paying off my student debt.

So essentially, like, you know, putting down 20% on maybe two, three, maybe four properties, for example. using that money to cash below the payment on the student loan and then obviously build equity and wealth for whatever our kids for the family whatever yeah what do you think about that um well um i did something similar in my 20s and i went broke so i'm not a fan i think your friend doesn't know what he's talking about. I now own, I now own several hundred million dollars worth of real estate.

Yeah. But I did not do it the way you're talking about. I paid cash for it as I went a little bit at a time. And it's gone way up in value while I've owned it. Yep. So, the problem to break the theory down is debt equals risk. More debt equals more risk.

debt equals reduced cash flow in real estate because you got to pay the payments more debt equals no cash flow in real estate so when you have a tenant that pays you just a little bit more than the house payment because you only put down a little bit on the house when you add up all of the repairs and the vacancies and the tenants that don't pay which happens occasionally When you add all of that together, you are actually losing money on a leveraged piece of real estate like you're describing. And so unless you're going to feed these three houses to the tune of about $500 a month each average, about $6,000 a year each with the numbers you're giving me, you're not going to be able to keep them. And so they do not become a blessing then. And the idea that they're going to cash flow and pay off the student loans, it's actually mathematically not going to happen.

And again, I'm 65 years old. I started doing real estate in 1978 when I was 18. So I didn't just invent this and get on TikTok. Well, I was going to say that real estate, to your point earlier, is a major part of your wealth today. So it's not that it's against real estate. You know, you're not sitting there saying, oh, my gosh, it's a terrible investment.

The idea of real estate's terrible. But the way at which you do it is really important. And I think the hard thing is too, Jim, you know, a lot of people set up these scenarios. And, you know, for some people, it's like, okay, yeah, maybe it could kind of work out. But that means everything has to be perfect, everything from the market, the tenant, the house. You could get in this stuff and you tear it on a wall and there's mold. You can't put a tenant in for 12 months until you do X, Y, and Z, and you bought it.

I mean, like, it just, there are so many factors to it that it never works out perfectly. It just doesn't because there's just too many things up in the air. And so, um, so I would, I would pay off your student loans, honey. Yes. Yeah. Yeah. Because essentially the way he was explaining, it's kind of like, you know, hey, you paid off your student loans, you know, congratulations, found the back,

here's your paper that you paid it off, rather than like, oh, hey, you bought, whatever, say one property, for example, you know, like, no, that's like a bigger, you know, good job in a sense. Yeah. In a sense, in a sense you said, okay, in the world of finance, we have a thing called opportunity cost. When you take your $90,000 and you do one thing with it, you lose the opportunity of doing the other thing with it.

Yeah, yeah. Okay. And so the way to look at that is kind of do a little reverse engineering. Let's pretend you didn't have student loans. Wow, that feel good. Would you go borrow $90,000 to put down payments on houses? No. Yeah, that's why I knew you would, yeah.

Yeah, which is exactly what you're proposing, if you look at the balance sheet of what you're proposing. So the data tells us that people most often build wealth not doing your friend's plan. Instead, paying off your student loans, using the increased cash flow and the increased freedom to start saving, paying off everything, being 100% debt free. And then let's pile up a little cash and get our first property with cash. And then to get our second property with cash. and when you get about the fourth or fifth one, now you've got real cash flow coming because there's no payment. Yeah,

and what's funny is even from a net worth perspective. It's way up. Well, his friend's way, it goes way down because you're borrowing on a $200,000 house and you have $90,000 of student loan. You know what I'm saying? You keep putting yourself deeper in the whole, even from just a net worth perspective

if you're just looking at the math too. Yeah. And Jim, always too. Remember this. An Excel sheet, a formula is never going to factor in the emotion of peace. And when you don't owe anyone anything, even a student loan, there is a level of peace there from an emotional, spiritual perspective that is not calculated in an Excel file. And I'm telling you, when people become debt-free, they pay off their houses, even in an extreme

sense, when people stay on the debt-free stage here, and they're completely debt-free, their house and everything. They literally have no payments. They never look back and say, I so regretted that. I wish I still had all this debt and I was living how I was living. They missed out on the opportunity to be highly leveraged and stressed out. Right. I mean, like, there is. So there's a level of peace there that I think is really important to solve for. And when you're just running and gunning and trying to do this whole thing to look good on a quote-unquote balance sheet and what you have to say for yourself, I would swap peace every time.

You're going to have time, Jim, to be able to do this. I believe you will have time to save up, go buy your first fixer-upper and get in the real estate game. That's great. When you do it all with cash, it's going to just take longer. and there's way more delayed gratification, but what that equals is a level of peace and sleep at night versus just that risk factor that's so real. Full disclosure, Rachel knows what she's talking about,

that's what her husband does, Winston's in the real estate business. Well, and he does flips, but with cash, yes. He buys property, and he does it with cash. And he runs my portfolio as well, and we do it with cash. And it didn't start off, I mean, like, you know, the first couple, it was like a condo. The first one was a little one-bedroom condo.

and it was pretty stinky. Pretty stinky little condo. And that was your all's first property. But what's crazy is, you know, you put the money in, you go and work it, you fix it. And then again, he's in more of the not. Made money. Yeah. And he's not in the whole business.

But even some of these flips, and I've told you this. I'm like, you know, one or two of them, if the market kind of slows down for about four or five weeks and you're holding on, we don't think much about it. His friends that kind of do the same thing that do have payments to the bank, they're like, God, when is this market going to pick up? And there's a level of stress there. And I'm like, I don't know. But there's just something to be said about not worrying. You're fine. You're fine.

You want to lose money in real estate, become a motivated seller. That's the best way you lose money in real estate. Martin's in Los Angeles. Hey, Martin, how are you? I'm doing great. Thanks so much for taking my call. Sure. How can we help?

So I've come into a, um, I've got a fair amount of debt, but I'm also, you know, there's some good things going on. I've, you know, I've got a job where I'm making really good money and a lot of room for upward mobility. And so far, my performance at the new job has been pretty fantastic. So, you know, I think there's a lot to look at, you know, positively about the future. but the weight of the debt is really, it's really hit me. So I make about, you know, I've got this job recently. I make about 200,000 a year.

Cool. What are you doing? I'm in sales. Good for you. What are you selling? I sell medical devices. Great. Good job.

Good position. Well done. And how much debt you got? So I have about 20,000 in student loans. $20,000 in credit card debt, which I used to help pay for school because I got hit pretty hard during COVID. How much you all in your car? About 30, but I get an 800, 900 months stipend for it.

It doesn't matter. You get that whether you have a payment or not. Yeah, yeah, yeah. And so what other debt? 20, 20, 30. What else? um that is uh that's it what did you make last year um uh before you had this job what'd you make uh so i made 150 the year before that i made uh 85 so i've gotten promoted twice in the last few

years so if you could live on 85 you could be debt free in a year i didn't have the car payment um back then i didn't i didn't have the uh the credit card payment then if you could live on 85 you could be debt free in a year okay all right i mean really here's the thing 200 minus 85 is 115 yeah and you only have 70 000 in debt okay is that right yeah i think with taxes and i'm putting about 12% into a 401 stop um stop doing the 401k temporarily till you get this dad-gum mess you made cleaned up. Okay. Completely focused on clearing the debt.

When I picked up the phone, Martin, I heard amazing amounts of stress in your voice. You were sighing, breathing hard, all kinds of anxiety indications in your verbal patterns when you started talking about the debt. When you talked about the job, you started lighting up again and your voice pattern changed. Okay, and you said, if I could, I'm drowning, you, the words you're using, and I'm drowning in this debt. And so I want you to react to this debt like your life depends on clearing it, because if you could make $200,000 a year and you had no payments, you can be wealthy, sir. Okay. But if you hang around with stupid car payments, stupid credit cards, and stupid student loans, and you keep them around like they're a

freaking pet and you try to ease your way out of this with the kind of money you're making and try to work some kind of thing where you scam the system, you're still going to have that stress in your voice. Get it. Martin, what makes you think you can't? If last year you were doing 85, what's the hesitation? It's not that so much. I've put, you know, I put a fair amount of debt on in the last year.

And, I mean, just, you know, stupid purchases and things like that. Right, right. But it's not so much that I can. It's more just kind of trying to figure out, like, what do you think is feasible? Like, what, just understanding, like, what would you do? And, you know, I'm new to this, you know, like, again. So if you're making $200 and you stopped your 401K contributions, what would your take home pay be? Per month.

Probably around 10 a month. Yeah. How much is your rent or mortgage? Rent is $3,000. That's the really tough one. And that's a big dollar. It's not like it's crazy. Yeah, it's 30% of your take-home pay.

Something's wrong, Martin. $200 minus $120. $10 a month is $120. You don't have $80,000 worth of withholding. Isn't it about $50,000 withholding at that point? Well, 50, not $120. It's federal. And then you have another 20-ish in California California maxes out.

They're rich people tax is 15%. Okay. Because they're trying to run off all the rich people. Wait, 15%? Yeah, California has a rich people tax of 15% of your income. I thought it would be more than that. No, that's it. But that's more than any other two states put together.

But yeah. But that's addition to your, I mean, so it's. Yeah, and then you've got your, what, four? Then you've got your federal, but your federal is not even going to be 50,000 in this case. So, you know, you need to really get above your numbers here and start working them through. So I think you're dead free in a year. What, 30% federal for him? No.

At 200? It would be 30% bracket, but it's not 30%. It's a marginal income. I know, I know, yeah, yeah. The bracket is not the amount. I misspoke. I know. I know. So it's about 26% is what.

No. Of the above the bracket, yeah. Including California. Yeah. Yeah. Yes, it is. Believe me. So, yeah.

Because these are incremental marginal tax brackets. They're not taxed at the tax bracket. So that's the point. So anyway, you need to get into this and figure it out and sit down and go, I'm going to be on beans and rice, rice and beans. I'm going to stop the stupid purchases. Three grand worth of rent for a single guy that's broke? I don't know, man. I may be looking at that, too.

And so, but for sure, for sure, I'm going to work my butt off and I'm going to do nothing but work. That's all I'm going to do. No vacations, no buying crap. You are broke. Quit acting like you're rich. You're not rich. You're broke. Act like it.

And pay down this debt and be done with it. Because you reach over and knock off all those credit cards in two or three months, which you could do. You probably do it in about four months, actually, three months, something like that. Then you're free to knock out that. then you're free to knock out that student loan and then reach over and knock that car out. Think about what your budget looks like when you don't have any of those payments anymore. This is where you've got to go to. And so what the plan is is stop everything temporarily and attack the debt, listing your debts smallest to largest,

pay minimum payments on everything with the little one and attack the little one with a vengeance. And please, God, don't figure out a way you can't do it. Figure out a way you can do it. That's the point. And so stop your 401k temporarily, stop your vacations, stop your happy hours, stop all this junk you're spending money on, unplug stupid Amazon, and go get out of debt. And then when you're free, you're going to make a lot of money, and you'll be able to stack cash really quick because you'll be used to living on less than you make. And that changes everything. You're resetting the wires in

your brain. Yeah, and it is a rewiring because I think our natural tendency always is to be moving forward, meaning like, bigger, better. You start with the starter house. You get the bigger house. Like our life, you know, you get promotions. Everything that we're used to is gradually increasing in life. And when you do this and you actually pause your life and go backwards in lifestyle, it kind of mess. It'll mess with you. Because you're not used to that, right? The celebration of moving forward always, oh, I got a bigger job. He's getting paid twice as much you know as he used to and it should feel like oh well i should have twice as of a better life not with this not when you have debt and so there is a rewiring and what feels like going backwards and that

natural tendency is not to like it i don't want to go backwards i should be moving forward but when you're doing it so on purpose it's and time goes fast too that's my other thing it feels like christmas is about to be here and i feel like we just had christmas right like you you think about how fast this time goes it's got to go quick it's not forever it's literally for a snapshot of a moment in time that you're going to do this, and it sets up your whole trajectory going forward with your finances. If you're tired of living paycheck-to-paycheck, feeling like a rat in a wheel, feeling like you can't get ahead, join one of our free every-dollar trainings.

There are new trainings every week this month, and they're all hosted by one of the Ramsey personalities, Jade or George. or Rachel. Rachel, when will you be doing the next one? Do you know? I think next week. George was on today, actually, during lunch. He was doing his.

Perfect. We're going to show you how to stick to a budget, and you find thousands of dollars of margin using every dollar. This gets you out of debt and helps you to start building wealth. We show you how to do it. And you've got a live Q&A. You can ask any question you want during the whole thing. It's the free that I mentioned is free every dollar training.

Sign up at Ramsey Solutions.com slash webinar. Jim and Sarah are in Michigan. Hi, guys. How are you? Pretty well, Mr. Ramsey. Thank you for taking our call. We're anxious to talk to you, sir. Our honor.

How can we help? Well, we've been married for 40 years, and we've gone through a lot of finances successfully. We've managed to save a substantial lot of money. And about three years ago, I acquired a 30-foot sailboat. and it costs roughly $6,000 a year to own and operate. What did you pay for the 30-foot sailboat? Well, my neighbor gave it to me, or I should say Jesus gave it to me. Free?

It could be more accurate. He gave you a 30-foot sailboat free. Jesus did. Yes. Yes, we have three sailboats given to us for free. Three. Okay. Do you currently own only one?

no we own three you currently own three sailboats three free sailboats and and you said you said you had piled up a substantial hey jim you said you had piled up a substantial amount of money what's your all's net worth not that much um about three point seven million sarah not that much she said not that much that's pretty good sarah well i listened to every day for two hours and we could do better okay so what are the three sailboats worth the cars altogether the cars and the sailboat no I ask what the sailboats are worth the sailboats altogether are worth seven thousand dollars and we have a camper worth five hundred

dollars okay so a 30 foot sailboat is worth 2,000 of the seven or 3,000 of the 7 Jim, does that sound right to you? 5,000 of the 7th. 5,000. Okay, so you got two junkers and one good one. Okay. You have a $5,000 sailboat, but you want to spend $6,000 a year to keep a $5,000 thing alive.

I'm confused. I am too. No, Jim. Jim, we already figured out what you want to do, Sarah. Jim, why do you want to spend $6,000 to keep something that's $5,000 alive? Well, that's just the normal cost of marinas, marinas, and then launching and recovery in spring and fall. Yeah. And, you know, minor incidental.

It's not that much, but I kind of expected that when you said you were spending $6,000 on it, that it'd be worth $30,000 or something. Well, you know, it's worth what you can get out and on a good day, but, you know, it could easily be worth $20,000. No, no, $5,000, $5,000. And we spent Wait a minute There's a bit of a discrepancy here, boys and girls Y'all are fun Well you know

With old stale boats It's what you can get for it on a No really Jim The Stinket thing has a market value Seriously The range of value is not between 5 and 30 It's one of the other You know that

$5,000 Where did you get that number, Sarah? You sound so sure The insurance What? The insurance Insurance does not determine value okay then I'm wrong okay it is between five and twelve

thousand dollars possibly but if you put a sign on it you might sell it for 12,000 no you can't sell it so bad people can't give them away well they did to you um that's the problem and so far he spent 30,000 dollars and 37 37 and 86 cents on a boat that people give to you 30 over 30,000 dollars and a you've had it five years um about three this is my third summer with it and he spent 30,000 dollars and 37 you know but we're talking like five I don't know okay so there's two issues here okay I don't know um Jim we're not going to make Sarah happy okay Sarah's not going to be happy with a sailboat.

Sarah's not happy with 3.7s? We know that. We know that. We know that. Sarah's not going to be happy with a sailboat. So then the question is,

Sarah, if you take the value of the sailboat and what you spend on it and you burn it in the middle of the floor, does it change your life

when you have $3.7 million if you take $6,000 and throw it out the window as you drive along the interstate, no, it does not change your life. So this is not a deal. breaker. You're not going to be poor and on food stamps because of Jim's sailboat, Sarah. You're fine. You can afford to do this. It's not a big deal. But Jim, you probably do need to think about, I mean, are you still sitting on the other two boats as well? Yes. I can only count one other sailboat except for a model sailboat in the living room. No, no, no. We have another boat, another boat. Oh, another boat, but not a sailboat.

Well, yes, we have another boat. Oh, you mean the road boat? Yeah. Oh, yes, sir. We have a 12-foot aluminum boat. Yeah, that's true. Okay. And a camper.

Yeah. Okay. And so other than mess with Jim, Sarah, what are your hobbies? Well, actually, to the honest with you, I'd actually like a kitchen sink. Oh. Hey, Jim. It's going to cost you a kitchen sink. Jim, remodel the whole free.

kitchen as your trade-out. Yeah, all right. You two cheapskates are made for each other. Y'all are fun. I love y'all. You're great. Listen, $3.7 million if it's growing at 10% is growing at a rate of $370,000 a year.

And we're having a discussion here about an aluminum 14-foot rowboat and a kitchen sink, y'all. You need to back up about three notches, pan your camera back and start enjoying some of this money. Now, being tight and smart is what got you here, but now you need to enjoy some of it. And if Sarah, if $6,000 makes Jim happy, it's $6,000. You can afford it. Okay. And Jim, if getting rid of the aluminum rowboat and the camper and the odd sailboat makes her happy, get rid of them and remodel her kitchen too.

You guys can afford to do all of that. But don't major in minors are stealing your piece, okay? Yeah. Well, when she says remodel, we have a three-year-old home. I don't care. On her top and a triple. Okay. All I'm saying is she wants me to tear that out and go down and get her a commercial sink like you find in the kitchen at McDonald's.

And I don't want you to do it. I want you to pay somebody to do it. Well, they're high-grade steel. They're high-grade steel. Yeah. Kind of like an aluminum boat. It's high-grade. Use the aluminum from the aluminum boat.

Make you a sink. We're going to recycle. You kill two birds and one stone. Hey, guys. Well, listen, you're stepping over dollars. You're stepping over dollars and pick up nickels. And it's stealing your fun. It's stealing your fun.

So there's stuff that my wife buys that I do not understand, but she gets, It's joy from it. And what I do, what I do get joy from is her getting joy. There's stuff that I buy that she has absolutely, she thinks it's stupid when I buy it. But she doesn't hassle me about it because we have the money and I get joy from it. And she wants to see me get joy. So let's major in you guys giving each other some joy starting going forward here. You knew it's a funny call.

I was like, we've been married 40 years. And she's like, 41. 41. We haven't got any money. were broke it's only 3.7 million we didn't do good we didn't do good they were funny y'all are great that was so fun oh my gosh hey give each other some grace and love and to the tune of about thirty thousand bucks each and just go blow some money on your 41 year marriage what a wonderful thing to do it won't you won't even know what happened you'll still have 3.7 million

I was the most fun I've had in a while. What, that call? Those two were a hoot. They were funny. If y'all want to call up and argue on the air in front of like millions of people, we would have you any time. Yeah, we had a segment for a little while with the person on it's called Settled a Debate. Oh, yeah.

People would call in and do, yeah, but they were, they were very entertaining. They were fun. God, man, I mean, just going to dinner with those two would be a hoot, arguing about what you're ordering. It's like, that's too expensive. Don't get the cheaper chicken. Don't do that. I love it.

Jenna is in San Antonio. Hi, Jenna. Hi, guys. Thank you so much for taking my call. Sure. I was calling because I'm looking for some guidance. It's a little backstory. My dad sold us, me and my older brother, our childhood home back in 2021.

And, like, the stipulation was that he could still live on the property and not have to pay, like, rent or utilities. And we, my older brother and I rent out the house. house and we make about $3,400 a month in profit off the rent. And my dad right now, who's a single parent growing up and everything, so he didn't save her retirement. He lives off Social Security and he says, money is tight right now. And he reached out to us and asked if we could give him $400 from the profit of their

rent each month. And my older brother was like, sure, 100% and I just like did not feel good about it. I was like, I think we need to look at your finances first, like figure out why money is tight and then like draw some boundary so it's not like every year like oh i need 500 600 and it add up and everything and i recognize like none of this money is coming out of my own pocket it's like purely just profit and i don't know if i sound like a brat as a child by not just giving it to him and so i'm just looking for guys in saying that he sold you the house yes so we did a so he sold it to or we did a parent to child transfer and all he wanted with

$50,000, and then we took over the rest of the mortgage. But me and my brother are on title and loan. Like, it's legally our house. Yeah, and so at the time that the mortgage plus $50,000 at the time this happened was how much? $450,000. So you had a mortgage of $400,000 and you gave him $50,000 cash? Well, we did a cash out refinance, and we gave him $50,000 from that.

Oh, okay. Okay. And so the two of you have a $450,000 mortgage now. And at the time that he sold you the house for $450,000, what was the home worth? Oh, like 1.3. Okay. Okay. So, and now he doesn't have any money? He says, yeah, money's tight. But, I mean, he doesn't have any money. He had $50,000.

And that was many years ago. through that, and he lives on the property, humbly, after he gave you a half a million dollars. He's not very wise. He shouldn't have given you that money. He shouldn't have given you this house. I know. I mean, his first obligation is to pay his own bills.

His second obligation, or his second, only after you're paying your bills and have a plan for your bills, do you start giving. stuff away. Yes, I think he had that plan. I think things, I'm not sure. That's why I wanted to look at his finances, but I look at it because the house is worth a lot of money, and then I feel like, I don't know. It was worth a lot of money when he gave it to you.

Mm-hmm. And he gave you a million-dollar house for half a million. Yes. Yeah. And, and yet, and yet he ran out of money. So the whole thing, he's a single. dad he hasn't saved for retirements bull crap because he would have had a half a million dollars in the account living off of that and not been calling you if he had just simply sold this house

correct and he's told us that he regressed it yeah and say it's 2020 but it's dumb yeah and so i assume he has absolutely no other money that you know of it's not like he's got a million dollars in the bank from something else. No, I think he has some things. I don't know because I haven't looked at his finances. And so I was like, hey, if we give you this $400 a month, like let's sit down and look at your finances, see where money is going. How old is he? I'm like, you don't have a car 73. And how is his health?

Great. He looks like he's 55. Okay. And he's retired, not working, Jenna? correct yeah um you you you don't have an obligation at all morally ethically spiritually anything but if someone had given me a half a million dollar gift and in return they're asking for two hundred dollars because 400 200 of it's yours 200 of it's your brothers i would i wouldn't think anything about giving them 200 dollars so you wouldn't do it

I would do it oh okay I don't think it would be a problem at all I mean he gave you a half a million dollars he stupidly gave you a half a million dollars that he shouldn't have done then he wouldn't be having this trouble

yes so I don't know what was going on in there in your own I'm curious Jenna why 400 for him to your point wanting to just to look I'm just curious if $400 you know does that change well what like probably living on social security living in the shed out back that's what it sounds like

right yeah i'm not sure that's why i was like i didn't know if i was in the right to ask him like to well i mean you you could be not not to ask him to justify you doing this but just to make sure he's okay he might need 800 I'm just worried my biggest worry is that he is giving it is going to give it to my little brother because my little brother just doesn't do anything and so that's a fair good that's that's new information that you never brought up until now sorry that's okay but now I mean so I think you can address that with your dad dad I want to make sure you're okay I'm happy to do this but I'm not happy to give my little brother money because he sits on his

But if you're going to give it to him, no, I'm not going to do it. And if you'll let me look at your stuff with you and make sure you're okay, I want to make sure you're okay. You gave us this wonderful gift all these years ago. And a little brother got cut out of that gift, by the way, didn't he? On paper, yes, but my dad is now coming back and saying that, hey, you need to split the house three ways. No. No.

I was a key wasn't financially responsible at the time of the sale, so that's why he wasn't included. Yeah. No, we're not redoing the deal. I've been dealing with this house, and now I'm dealing with you. No. The deal's done. But again, you see how

haphazard this whole thing was? When y'all did this deal, it shouldn't have happened. It was a bad deal for your dad. And he didn't think it through well. And now he's trying to come back and slide the brother in. And now he's trying to come back and slide 400 bucks out because he should have never done this in the first place.

He didn't have the half a million dollars to give away. He was too broke to be giving away half million dollar gifts. Okay. And so, yeah, I would be concerned that he's okay because his judgment's bad. We've established that. I want to make sure he's okay. I want a loving act. Yeah, I'm happy to do this to help you, Dad.

Yeah, and I'm not going to put the little brother on the deed, period. Yep. That's done. And the money's not going to the little brother. But if all is said, and he says, no, it's not. This is for me to this. And I would take care of him. Yeah.

I mean, he gave you a half million dollars. You give him $200. Zippy. It doesn't matter. I mean, yeah, I would do that. Definitely do that. But step back to Dodgers and y'all, as a family, learn your lessons from all the ridiculous things that have been done wrong in this whole thing.

So, and now I'm really worried about you and your older brother being partners in this thing. And now little brother decides he's going to go into orbit about this. Yeah, this is, this is not clear. It's not good. So bad deal all the way around. Bad deal. Man, so. But Jenna, I don't think you're being a brat for having these questions.

You asked that at the beginning. And I think you're having some like critical thinking. Yeah, you've got some concerns that are valid. Yeah. And I would look into those concerns, but I want to do it through the lens of love. I love my dad, and he was generous to me, and I want to make sure he's okay. Not of, oh, I'm not going to give him 200 bucks. That is braddy, if you're going to do that.

But, you know, if he's going to give it to the little brother and the little brother's buying weed with it, no, we're not doing that. I'm with you on that. Welcome back to the Ramsey Show. Rachel Cruz, Ramsey personality. My daughter, best-selling author, is my co-host. Open phones at AAA 825-5-225. Emily is in Maryland. Hi, Emily. Welcome to the Ramsey Show. Hi. So my question, so a little background about me. My husband and I are both accountants. um we make about 10k take home pay right now after we put in about 10% of her earnings into um 401k and you know insurance and everything and how much is the 401k in the insurance a month um i don't

know exactly but for me for my husband i don't know but for me i take home about 48 um 45 yeah but your take home pay real take home pay, as you know, is not after insurance in 401K. Real take-home pay is after taxes. Right, so this is after taxes. It's after taxes and after 401K and after health insurance. Yes. Yeah, so what I'm trying to ascertain is what your real take-home pay is.

Okay, go ahead. Right, yeah, this is the paycheck that we get. So the dilemma we have right now is that we are living in our house right now, which we bought about 10 years ago, a foreclosed property. We needed a lot of work done, but we bought it because it was cheap. And over the years we have, so I've always tried to live below our means, and we have no debt, we have savings, we have an emergency fund. So we're kind of on the step where now it was time to pay off our home.

But recently, I was working at a school where my kids were going for free with a private school, but both my kids have learning issues, and so we have. to take them out of their private school, and now they're in the public school in our local neighborhood, which are not that great. The dilemma we have right now is that we want to move to a better school district, but obviously the house prices, everything that we're looking at, is really going to put us in a position where we're going to end up living paycheck-to-paycheck. um and what so like we we don't know whether we should make that move or not because our house is more than enough for us we're living comfortably in it it's only the schools that are we're not

happy with yeah well i mean i don't know the math yet but if your statement is true that you're going to be broke because you made the move and paycheck to paycheck with no margin that obviously means you can't afford it if that statement's true so but you might be an accountant who's super tight so I don't know um the um it sounds like that your after tax take home pay would probably be around 12,000 or a little bit more per month not counting in more 401k if you took added 401k and health insurance back in I think that's going to add a couple thousand dollars a month to your take-home pay does that sound right um yeah i think we'd be around 11k i think you'd be around 12k i don't think you're doing all that for 500 bucks a month

what's your household income well no i know you're not you told me your household income okay so no you're you're you're not that's not 500 bucks so uh unless you're not putting much in your 401 k i know that i i put about 12 percent and my husband puts about 10 percent so um i um i don't really know what that comes out to be. I haven't looked at it in a while because... Well, the average would be 11% between the two, but let's just call it 10%. And you make $100,000 a year. That's $10,000 a month or $10,000, $11,000.

So 401k alone is $1,000 a month plus health insurance is going to be another $1,000 a month. So, yeah, I'm right. It's $12,000. Something like that. Yeah, I guess. I guess. But what we get in hand right now is about $10K. and I know

Okay But what I'm trying to say is that If the mortgage comes out to be like between 3,500 to 4,000 Which is what the houses we're looking at right now If you put that on a 15 year fix That's going to be about a fourth of your real take-home pay That's going to 3K would be a fourth Would be about your max

Could you find something for 3K Emily In that area so we have about 400k equity in our house our house and what we're looking at is obviously to upgrade I know that that's kind of going above our well don't upgrade to go paycheck to paycheck can you can you get a smaller house in the nicer area just to get the kids in the school we can the long term I feel like it wouldn't be a good move because we wouldn't be able to you know, have the same kind of equity in that house or, like, be able to sell it. Because we do want to have, like, just this.

So, Emily, so this is a, okay, so it's a values conversation at this point, because as you're saying, you're going to live paycheck to paycheck if you make this move, because you're already assuming you're going to upgrade houses to get a bigger house of what you guys are currently used to. And the reason you're getting a bigger house is not for your kids. Yeah, so there's a value system conversation of do, do, do I, am I going to do what I have to do for the kids? That's number one. And we'll figure out the math and live somewhere smaller to because that's our value. That's our number. one value. Or is it we want to have a place where our family can grow in a home and get

X, Y, and Z, you know, type of house. And if that's the value, then go there. But one has to trump the other. For the math, you can't do both. And it sounds like the kids are the number one, Emily, right? And so for now, I would. As a mom with three kids, I get that. Like, you want them in a great space where they're going to thrive and it's awesome. And if that means we have to move to a smaller house, we have to move to a smaller house. And then it may be five or six years we can upgrade right i mean you can your income's going to go up over time but if you need to make the move it sounds like you can't do both yeah don't strap yourself to buy a bigger house that you want and blame it on the kids it's not that's not fair yeah um so if you want to buy a house for the kids

move over in the school district and it's going to be a smaller home right and it's not going to and it's going to go up in value yeah so the equity you're not going to lose equity you're going to you're going to increase your equity because you're in a better area. Yeah, maybe an older, smaller home, but it's in a better area for the kids. And we did this for the kiddos. Yeah. And that's the situation. So, but the formula that we use, the reason I was poking around on your stuff, your

interest, your take home pay so hard is a fourth of your take home pay on a 15 year fixed is what we suggest because that gives you room where you are not living paycheck to paycheck. you've got margin in there to save for Christmas, save for the next car, save for a trip, you've got margin in there, and you can start putting 15% of your income into retirement at that point. But if you go over 25% of your real take-home pay, and you're calling take-home pay, I'm talking about when I say take-home pay, we're talking about only taxes coming out. And you've got at least $2,000 in non-taxed. coming out of your checks.

So you're dealing with about a $12,000 take-home pay the way we're defining it after taxes, maybe a little bit more, which would mean one-fourth of that, which is $3,000. And that's what we would recommend on a 15-year fixed rate. And 15-year fixed rates just went down a tiny bit this week, just a little bit, not much, but just a little bit. So that's how we get at it. But the thing you've got to do, Rachel's right, is you have to separate. these discussions and keep it very clear what the primary goal is.

What's the primary value we're trying to solve for? Our question of the day is sponsored by Y. Refi. You didn't take out private student loans hoping to default, but life happened. Why, Refi won't shame you. They'll help you explore a real plan to get back on track. head to Y-Refi.com slash Ramsey, and you can find out more. That's the letter Y-R-E-F-Y.com slash Ramsey, not in all states. Today's question comes from Ashley in Colorado.

We are the parents of three young kids and have a YouTube channel, which has been monetized for just over a year. Right now the funds are sitting in the bank in our names. We'd like to know how to grow that money wisely, but also keep some liquid. Our plan is not to give them any access to it until each of them reaches the age of 25. We are longtime listeners and really value your guidance.

Should we leave it all in the bank or invest some of it or all of it? This is the, we've had this kind of question. I've had it three or four times in the last few months about monetizing on the Internet accounts and stuff. It's like, really? Well, we don't know what it is. You can monetize on YouTube and it's a small amount of money or it could be a million dollars. And so I don't know what we're dealing with. here um so the best antidote to money screwing up your kids is for you to not have screwed up

your kids money does not screw up kids money reveals that your kids are already screwed up and so you can't put it in a you can't keep it away from them long enough for them to not be screwed up 25's not a magic number and so So I'm going to teach them responsibility, generosity. I'm going to teach them wise spending. I'm going to teach them saving. I'm going to teach them work ethic. Age appropriately.

We don't know how old the children are. She says young kids. I don't know what that means. And so, but age appropriately so that when this money does come to their hands, they see it as what it is, a responsibility, not that they are a four-year-old who the lottery and so and you turn them into a trust fund baby of some kind so having said all of that i'm going to be really really i'm going to spend 90% of my calorie burn on this on making sure the kids are okay first and foremost then we can talk about the technicality of the investment

okay the only way you keep it away from them until age 25 is if you put it in a trust if it's in anything else it goes to them at age 21 and you can't stop it unless it's in a trust trust. So you're going to have to go see an estate plan attorney. And it sounds like it sounds like the funds are in our names, which makes me find like the parents' names? Yeah, well, it has to be in your name because the kid can't, you can't put a, a child can't do a contract. And so if you open a bank account for a kid, it's an uniform transfer to minors act. And that means it's in the parent's name, or it's in the kid's name, but the parent is the custodian. Yeah, but I don't know if the kids are getting paid for the YouTube channel. Do you know what

mean it could just be the parents getting paid i don't know okay that that could well that could be that would solve it that was all you give it to them whenever you wanted it's your money yeah if it's your money legally uh or morally for that matter so anyway what would i do with it uh i would make sure that some of it was available for their first car and that they add some to that um and so that's the part that's liquid i would make sure there's some money available for fun a small amount of some kind. And again, we don't know how all these kids are and how this is going to unfold. But this is what we did with Rachel and Denise and Daniel. And so, and then the rest of it are probably going to sit down with SmartVestor Pro and get some money going into mutual funds.

Again, if you're talking about $15,000 or $20,000 here, it's irrelevant. You're spending way too much effort to worry about it. If you're talking about a million dollars or $750,000 or something like that, then it becomes relevant. And YouTube channels can monetize at all kinds of levels. We have a YouTube channel. We know. And so I know exactly what we make on our YouTube channel. So on the monetization portion of it anyway.

But so, you know, I remember the first time I met someone. You remember Shea Carl? Yeah. That's the first guy I ever met who had monetized a million dollars on YouTube. That was Twitter was new. That's how long ago that was. So a long time ago. go. And they had a family channel at the time. The kids and the family were all on there

and their YouTube channel that blew up. And when I found out he was making a million dollars on YouTube, I passed out. As far as I knew, it was cat chasing lasers everywhere. But anyway, so it could be. And I'm going to say this, and I don't know it, so I even hate to say it out loud. But I think there are some laws in some states happening with child creators that they have to be paid because a lot of these families are doing family things. and the kids are part of the monetization and stuff. So like that whole duggers mess. Yeah, yeah, I don't know how much of how big of a deal you guys are on it,

but that's starting to become. I'm fine with them giving them the money at some point. I just want to make sure that the kid is able to care. Yes, totally. Obviously, if you raise a kid and they're a heroin addict and you give them a million dollars, you're going to kill them because they're going to overdose. And so they're going to go buy a lot of heroin.

And so you've got to, you know, you have to build the carerone, into the individual, that's the best way to leave an inheritance and to handle something like this where the kid becomes – so the problem like in the old days, it wouldn't have been YouTube, it would have been a Hollywood child star, you know, that made all this money and then what happens, you know, the parents abscond with the money immorily and or the child is just so dysfunctional because of the way they're treated in the spotlight that they're not capable of handling the money when they become an adult. Right.

And so that's what we've got to guard against are those kinds of things. I don't sense anything in here about actually taking possession. No, I don't think so. She's trying to figure out how to bless her kids. Yeah, yeah, yeah, yeah, absolutely, for sure. There's nothing in this, that even between the lines or the way the words are formed. No, it just made me think family YouTube channel. Like, oh, I just read an article recently talking about child monetization and how children now are going to, you know, but anyways, that's a, yeah.

Well, I mean, the Duggers, that whole. thing on that and you know they were cute the parents kept all the money and the kids resent that and that came out in not only the documentary but yeah we've met we've met some of them and they're not happy about it so that that's the kind of thing so that that's very real if your kids are a prop in your reality show you know that that's an that's a thing so anyway the character the kid number one and then number two yeah to teach them and you know guys The book that Rachel and I wrote is Rachel's first bestseller, and she and I did it together, first number one, and it was smart money, smart kids, teaching your kids how to handle money, and the beautiful thing about using it is, it's not really about the money, it's about you're teaching, you're using money as a methodology to teach character, to teach generosity, that living with an open hand, that other people are important. The access of the world doesn't run through the top of your little head.

and so you know to teach work ethic and yeah you will brush your teeth so you have some later you will you know you will do this chore um and not just because you're going to get paid but just because i said so because you're going to leave my home knowing how to work that way you stay gone when you leave and so um you know that kind of thing is loving your kids well and it goes back to what Andy Andrews used to say, and it's one of my favorite Andy Andrews quotes, I'm not trying to raise great kids. I'm trying to raise kids that become great adults. And it's a different skill set. We're trying to raise kids, not kids that look like a little stepford children and they are weird because they act like they're 32 years old and they're four.

I don't need that. Okay, I want a little four-year-old to act like they're four. But I do want to raise them in such a way that when they are 24, they're a person of substance, a person of poise, a person of integrity, a person who knows how to work, and how to save and how to give. And if you do all of that, then some of this other stuff is not going to matter. Yeah, it'll work itself out. It will work. You can't mess it up then.

You can leave them a million dollars at 18. You can leave him a million dollars at 25. You could dole it out gradually. You can put it in a trust. You can not put it in a trust. You can do all kinds of stuff. And so, but yeah, as far as the investment part, of it, if it is a substantial sum, I would sit down with a SmartVestor Pro, click at Ramsey Solutions.com,

click on SmartVestor. You'll find the people in your area that we have vetted and that we love and that have the heart of a teacher. And they're going to give you advice that sounds ridiculously Ramsey. Sarah is in Ohio. Hi, Sarah. How are you? good how are you better than I deserve what's up um I was wondering if you guys had

another suggestion to help me clear my credit report of a card a credit card that was opened by my husband before he um decided to take his own life so sorry he last thank you last summer and into the fall he um started to accrue a lot of credit card debt unbeknownst to me. I did not know about any of this until about a week before he passed away. And then after his death, I found out about the credit card that he had opened in my name only and charged roughly close to $12,000 worth of stuff to it. When I received the first invoice in the mail, I reported it as fraud because I didn't know. And through their investigation is how I found out that he opened it in my name.

Still fraud. And it's because, yes, because he made two payments to the credit card out of our joint checking account, and because it has my name on it, they denied it as fraud. And they lose. They lose. No, it is fraud. Period. I went a step further asking for the application and things like that and the transactions.

Yeah. They provided those to me. Which company is this? Chase. Oh, baby figures, okay. Yeah, they're scum. Lastly, I filed a police report. Yes.

Because he used his phone number, his email, and his mother's mate name on that application because he did not know mine. Right. So I've been denied twice, and the police report is the last thing I just sent in last week. Yeah. After this, I really don't know what else to do to get this off of my credit report. Okay. I got you. handle it. I'm sorry. Oh, my gosh. So, was he, you said he committed suicide in December?

Yeah. How long were you all married, huh? Um, just two years. Oh, wow. Been a long two years, isn't it? Yes, it was. So he was struggling with, it sounds like he was struggling with some mental illness, obviously, of some kind. Yeah. Yeah. Yep, that's what I'm, I'm gathering after the fact as well. Was he being treated for any of it that you know of? No, he was not. Okay. So we don't have any... His father also committed suicide.

Wow. So I think this is a long history of within his family. Oh, no. Sarah, I'm so sorry. Wow. All right. I'm currently raising his daughter and she wants to stay with me. She does not want to go home with her mom.

And the court system is allowing that. I have not yet to open the estate. And I know that's going to be an even bigger. to tackle. To be honest with you, I've had, I've called multiple people and I have not even received a call back of some local lawyers to help me tackle that. I was waiting past the six months so that all that credit card, those creditors, would go away. No, that doesn't. That doesn't work. They still can file a claim against the estate because you've not handled the estate yet. And so what is the rest of the situation?

My home is in my name, but we purchased another home why we were married and actually in the same neighborhood. And we were going to do an Airbnb with it. And we did do that for a short amount of time and we currently have a renter in it now. The home is in his name financially. It is deeded to a business name that he started. started up last fall. That's the estate, essentially. What's that homeward?

Online it states roughly 450. And what is owed on it? 320. Okay. So just for cleanliness sake and to help you, we can help you with the first thing to start with. I'll come back to that. But it's not going to help ultimately because it's going to land back on him.

So when anyone passes away in any state, what you own as an individual, anything he had any ownership in, any assets, stands good for any debts that he is responsible for. Okay. And so the equity in that house is going to stand good for the debts that he has run up. Okay. and and you that includes the debt that after we fix this identity theft then it's off of your name and it goes back on his name this $12,000 with Chase is going to get paid out of the equity of that house okay even though you are not personally liable so all we're doing is moving the shell

the P under a different shell okay okay but so it's not going away is my point because he's got he's got he's got a hundred thousand dollars in equity over there and how much debt did he have? From what I could tell, on credit card debt, he was pushing $100,000. One of his cars was taken back, like the bank came and got it. Did he own anything else jointly with you or at all? Any other assets? Bank accounts, investments, anything?

There were some bank accounts. are joint checking and savings, but there's not a lot of money in there at all. And we did own a truck together, a 2025 GMC truck. I was able to get that title put in my name by providing the death certificate, and then I was able to sell that back to the dealership. But I took a $17,000 hit on that. But I had to get it out of my name because I couldn't afford the payment on it. I understand. So I had to dump that quickly. My credit score last year was an 842

before all of this happened, and it's a 620 today. Yeah. That's okay. That's okay. We don't need a credit score. We need to life. I agree. And I have my home, and my car is paid for, so I don't need my credit, but it's definitely hard to look at that. So it sounds like when you liquidate anything

that's got his name on it, it might come close to covering the debts that had his name on it. But you're not going to benefit anything. you're not going to have any net of anything. It doesn't sound like what you're describing to me. But you need to do it anyway because otherwise they're going to come after the stuff that has both your names on it. So you've got to get the estate cleaned up or those bank accounts or checking accounts that had both names on them.

And they may come back after that truck transaction because that was technically his. okay even though you didn't benefit you lost money um but that had your name on it too right yes financially yeah i was the main buyer he was the co-buyer yeah so you know they won't come back after you because you lost money you make money but your bank accounts and that title of that house over there they're going to eventually come after all that and you're better off to be proactive to get a probate attorney and you're going to spend a few thousand dollars to work this through to get that all done. Now, back to your other thing, we've endorsed a company called Xander Insurance for

Identity Thief Protection for, I don't know, 20 years, since before identity theft was even a thing. And now it's definitely a thing. And when someone has their identity theft and something, their identity is stolen, the unique thing about this protection is, is they assign a counselor to you. coach to you that goes and cleans it up for you. Okay. You did not have that protection when this happened, but you know someone who can get it

done for you, and that's Rachel. I'm kidding. It's both of us. All right. So we're going to put you on hold, and Kelly's going to connect you with Xander, and occasionally as a favor for someone in an especially hard situation, they will take something even and run it through the system and take care of it. you even though you did not have the coverage at the time okay okay can't but can't

really buy home insurance after the fire okay but but we're gonna we're gonna do that anyway and so we'll take care of that and they'll take this case and run it down just because I don't like Chase and that'll help so but but the point is I want you clearly understand we're really not getting getting rid of it we're just putting it over into his estate so it's gonna come up again when you clean up his estate. Okay. All right.

Well, I appreciate it. All right. You hang on and Kelly's going to pick up and we'll try to help you get through this, kiddo. Hey, Kelly also set her up with a Ramsey coach as our gift. She's a widow. We're going to take care of her. Okay. Now, buying real estate, selling real estate, trying to get a new place.

A lot of drama out there right now. And when there's drama, there's one thing you need to depend on and that's facts and facts are generally not your hyped up friend who has an opinion about socialism no let's just find out what was really going on what's really happening what the real prices are what the real interest rates are and let's try to get those straight up if you want to know what that is just go to ramsysolutions dot com slash market or click the link in the show notes if you're listening on podcast or on YouTube. Dallas is in Louisville. Hey, Dallas, what's up?

Hey, guys. Davis, Davis. I'm sorry. Hey, Davis. I'm sorry. Okay. Not a problem, buddy. Starting off with my question quickly here. I'm a divorced dad of two. Just forgot through the divorce. I'm just trying to figure out what kind of route I should take to build my retirement and future for my two children. I currently have zero in retirement. Wow. Hard times. I'm sorry. um yeah okay what do you make um i've been to a stay-at-home dad for the last four and a half years that's my wife ran a successful business i just got back to the workforce in june doing self-employment remodeling that i did before i was retired i make we're currently about four to five a month

before i was retired i was making about 80 grand a year okay so you're going to be able to get it back up to a hundred now okay exactly all right and so you're making 100 grand a year you're 38 years old. How much debt do you have? Zero consumer debt. My truck's paid off. I am only purchasing a house, which I just did for me and my two kids, and I'll have about 40,000 left in my bank after I put a 280 down payment down on my new house. Way to go. Nice. Okay. Thanks.

And so the finances and the divorce were in pretty good shape. Yeah, we were fine. We came to an agreement. We kept the admissible as we could, obviously mostly for the children and we're settled on that and signed and now it's just me moving forward and sitting up my future. Yeah, but I mean before the divorce, y'all weren't broke is what I'm saying. That's good.

No, no, no. My wife made a salary of about 25 per month. Yeah, okay, cool. All right, so you got a good head start here. You got a house, you got a good income. Yeah. You know, make sure you got the emergency fund in place. You don't have any debt, so that takes your right

to baby step. four, which is 15% of your income going into retirement, and that'd be $15,000 a year going into 401ks and Roth IRAs. And if you're running your own business, or you could call it a simple 401k, or simple IRA, which is a 401K for a small business, you can do a lot of stuff, and you could easily get $15,000 into good mutual funds a year. And if you do that from 38 to 68, you're going to have millions and millions of dollars. Okay, that works.

I do also be getting approximately $80,000 in a couple months from my father. And I was just seeing what I should do with that money, I guess, throwing it into a Roth or something as well. I'm probably going to pay the house down. I want to get the house paid off while you're putting 15% of your income away. How much do you owe on the house, Davis? It'll be about 130,000. Oh, wow. That's great.

And you're getting how much from your dad? About 80,000. What's that from? he's got a settlement from his mother in a nursing home that they basically gave it the wrong medicine and seemed to have got her oh my gosh okay so he's distributing it to her grandkids yeah he's distributing it to me he already gave my sister a front for their property a year or two ago and he wanted to even us out yeah so that means you only owe $50,000 on your house now yeah that's true yeah you get that thing you get that thing paid off, boom, now you've got a big chunk of change to throw towards investments with no

house payment, right? So, yeah, throw the 80 at the house and then knock that other 50 out as quick as you can too. And let's be clear. And no debt, stay away from debt, and be investing and be generous. And you're going to be in great shape, man. You're going to do fine. As far as setting all that stuff up with your Roth IRAs and everything, just click on SmartVestor Pro at ramsysolutions.com. Yeah, and above that, once the house is paid off, that's the Baby Step 7, where you continue to build wealth and be generous. So you can go above that 15% at retirement and max out some of the stuff if you can. I mean, if you can max out your Roth every year and, you know, put some money into a 401K or that simple 401K, simple IRA. Yeah, guys, you all forget to, sometimes you all are listening to us do this and you forget how this math works.

So we paid off our house many thousands of years ago, it feels like, and it was $1,500. a month and I was paying about 2,500 down on it, and then I got a chunk and I took it out, okay? So I took the 1,500, I rounded up to 2,500, and I put 2,500 a month automatically coming under my checking account into a mutual fund. And I kept it a separate mutual fund. I just want to see how fast a house payment became a million dollars. It was unbelievable how fast that was a million dollars.

It was just a few years I looked up and I went, paying yourself a house payment really is a lot of money. It's a lot of money. And so when you get that house paid off and you turn it around like you're talking about. That was that was forever ago. That's thousands of years ago. So now it's like, there were dinosaurs in the backyard. Yeah. Yeah. So remember that. It's more expensive these days. So even if you get your house paid off now, think about how much more money. Well, I mean, yeah. That was only $2,500. You know, that was a big house for $2,500 back then. But that's when you could buy a house for a box of strawberries. I know. You traded two oranges. Two oranges and you boomers and you could get a real and he did great with your house market you don't know how life really works but you had a

great housing market oh jeez you should have seen the income it's my poke should have seen the income always yeah rudy's in chicago hey rudy what's up hey david and rachel thank you so much for having me on sure how can we help we're well we just want to say uh we're huge fans started a few months ago. And I also want to mention my seven-year-old, also a huge fan who has memorized the baby steps and will recite them to anyone willing to listen. I just wanted to pass that on. Oh, no. Oh, no. Rudy, I don't even know my kids can, so that's impressive. It's pretty funny. But so my question, I guess to begin, so we're basically in full gazelle intensity and on step two. But we plan to be on steps four and five in about six months. Good.

And so my questions revolve around my wife, who's a state-home mother. So my questions are, once we're done paying off debt, should we be investing more than 15% of our household income to account for the fact that she's not building her own retirement? No. She has rights to your retirement. Gotcha. And also, so with that, do you recommend setting up like a spousal IRA?

Yeah, yeah. But not because she needs her own retirement. because she's got rights to your retirement. Ask anybody who had a 401k with a half million and got a divorce. Yeah, I understand. Yeah, so that she's in good shape. She's fine, but yeah, I've done spousal IRAs every year just because it was a good way to keep the government's hand off of money, right? Yeah, absolutely.

Yeah, so, yeah, do Roth IRAs for sure in both your names. And as a part of your 15%, and then, you know, but I would max it at 15. let's get the house paid off and then let's load up like we were just talking about before we picked up this call. Yeah. And you can do backdoor, I can still do a Roth IRA because I can do backdoor Roths regardless of your income. Basically, the right to do a traditional, a regular Roth IRA goes away when your household

incomes up over 200K. And so obviously mine is over that. But for me, but what you can do is open an after tax. traditional IRA, not a pre-tax, an after-tax, traditional IRA, and roll it to a Roth 30 seconds later. And I do that every year for Sharon and me. And the spousal IRA, I don't think many people realize that that's even an option. That's true. Yeah, if there's a stay-at-home parent, not making an income.

My wife does not have an earned income, but I have an earned income in excess of both IRA limits. and so I can fund my wife's IRA or in the case the wife is the working when the fund the husbands but either one it works both ways but the if you're you know my wife has not had an earned income and you don't have to make a certain amount to qualify for the spousal you don't have to make anything yeah to qualify for the spouse

no I'm saying the spouse that's working though yes you have to make more than the two IRAs combined and the amount you're putting in which is not I mean you're going to make $16,000 a year You know, or whatever it is. But yeah, it's nothing. But you've got to have an earned income in excess of both of them. But that's all.

Wow. Wow. Welcome back to the Ramsey show. Rachel Cruz, number one bestselling author. My daughter is my co-host. Open phones at AAA 825-5-225. Samantha's in North Carolina. Hi, Samantha.

How are you? I'm good. How are you? Thank you both for having me on. Sure. How can we help? I appreciate it. So, I'm 57.

I'm a single mom and have been for about 15 years. When I get out of school, my mom and dad didn't have a huge great financial education. They were both teachers, and I always knew that I would make sure that I kind of did the right things when I got older. So I had jobs from the time I was 14, and when I got through law school when I was 21 or 22, I started to kind of immediately invest my 401k and have done that for 20, 30 years. The problem is circumstances happened and became a single mom and ended up with two daughters who, basically I ended up putting them through college and part of grad school and long story, made short, used up most of my income and my retirement to get.

them through. Obviously, I realized that wasn't the best call at the time. They're just both amazing kids, incredibly hard workers. What did you, how much did you spend on their education, honey? Between college and grad school, and they took out loans in grad school, I, um, probably at least 300 from my 401k and then, of course, how much? Throughout about 300,000. okay so and you paid all the taxes and the penalties on all that obviously yeah yeah and I know do you have debt Samantha with it now you said you took out some loans yeah I have about 65,000 left to pay off obviously fully aware this is probably not the best way to approach it at the time that would be an understatement no I know I know yeah a they went to a

college they couldn't afford. And B, you should have never used your 401k ever to send a kid to college. There's not a circumstance on the planet that that makes sense. I know. But you're there now. Okay. All right. So what do you make?

You said law school. That's encouraging. What do you make? I now make about $100,000 a year. Why? You've been practicing law for years. I have. I kind of took a different path.

and ended up at a firm where I was able to kind of juggle the raising the girls and and okay but can now they're gone and they have degrees and they're on their own right yeah for them yeah just recently yep yeah good they need I mean good good financially they it's time for these kids they kind of got it's time for you to quit feeding them for sure so now can you now can you go make 200 you kind of I don't need to. Yeah. What do you have left, Samantha, in the 401K? Anything? About 80,000.

So my question that I was trying to get to, and fully aware of all this, no excuse other than the fact that things happen quickly and something their dad kind of dropped out at a time when. You made an emotional decision. I understand. Yeah, I did. I understand. Okay. And I don't regret it. What is your question then? My question is, I'm 57 trying, you know, I probably have, what, 10 years to try and make up some thing.

And I recently came across the Ramsey program and took financial peace last year. And it's fantastic, wish I had taken it 20 years ago, right? But it is what it is. I know better now. Okay, that's good. So my question is one of your kind of general thoughts is that you shouldn't, until you off with the baby steps, but you shouldn't invest at all until you pay off the debt, which I understand, but if it, my question is, if it takes me, like, say, a year to get the debt

paid off at this point when I'm this time-wise... Still mathematically, we're not going to make another emotional decision, okay? I know you're scared, and this thing's, this retirement thing's bearing down on you, and it's causing you to have incredible regrets for the things that have happened in the past. But all of that aside, the fastest way mathematically for you to get a good nest egg is first get rid of the $65,000 and make sure you have no debt and you're living on a detailed budget and anything we can do to increase your income to accelerate both of these things. The debt removal and the rebuilding of the nest egg is absolutely vital. And so if I'm you, it's time for you to go make some money and you've been putting everybody else first for a very, very long. time, and you now have no choice in the matter. You have to put Samantha first. Yeah. Yeah. No, I appreciate

and just to clarify, these two girls that are not. You know, we're talking incredibly hardworking. I didn't question their character, honey. Yeah. Yeah. I just question where they went to school and where they got the money. But that's all in the past. You know, I'm not going to beat you up anymore. That's not what we're here for. We're here to move into the future. So the future is, The future is you're going to make as much money as you can make. And if you change law firms, you go make $200. I kind of love your girls to step up and take on the $65. Yeah.

Hello. Yeah. Well, I mean, one is... They're so great. No, they're great. They're just, one is literally just graduate from Columbia, and she's in a doctorate program, and so she's paying, it's a fully funded program, and she's paying all her bills now. And the other one is actually having to have an interview at Navy,

know and so they're that's awesome i just think yeah i know i hear you and i don't question that it just would be nice if they stepped in they don't have to legally because your name's on the on the loan nor do they have to morally because you didn't you didn't it wasn't the deal you made but it would be cool if they go make 300 000 a year if they reach over and take care of this loan so their single mother doesn't have to retire on alpo no they're they're they're they're that's a non-issue these they're both great kids but they're just literally getting on their feet. So, you know. That's fine. Okay. So Samantha, yeah. So between now, hey, between in the next 10 years, though,

for real, working as hard as you can, upping the income, getting the 65 paid off. And then what's your housing situation? Do you own a home? No. No. Okay. I did. I did. I did. I'm a divorce. Long story. No, that's fine. So that would be that. How long ago were you divorced? Probably about 15 years. Okay. but there's there's a whole lot of issues that I wouldn't want to talk about. That's fine. That's all good.

But, but, but, but, but, but, but, but, but I got put in a situation where I did the best I thought for the girl. That's, yes. Okay. So moving forward, though, again. Yeah. Getting that debt paid off and then and then. Yeah, and you got to get, you got to get a home that you get paid off, a little one-bedroom

condo or something, something that you get paid for and so forth. So, okay. Um, she loves her kids and, um, single mom, warrior princess. doing the best she could. Oh, yeah. Not to pick on her, okay, but to say, if you're out there in that situation, you have to make decisions based on facts, not feelings. And I'm going to take care of my children at any cost is a feeling.

Those kids could have gone to state schools, not Columbia. They could have worked while they were in school. They could have gone and got scholarships. They had a mother that was a single mom. And there would have been no dad and no $300,000. or cash out. Okay, and the kids would have been fine. And still great character.

And still great kids. I mean, seriously. Still great kids. Are you staying on track with the baby steps? Do you know how? Take a quick quiz for free and check your progress, and we will give you a personalized plan to get you on track. Simply head to the show notes and click the link titled

are you on track with the baby steps and complete the free quiz, and we will give you a personalized plan. Rebecca's in Texas. Hi, Rebecca. Hey, Dave. How are you? Better than I deserve. How can we help?

Well, I am in a pretty interesting situation. And kind of sad as well. Earlier this year, a, I guess a boyfriend at the time of two years, was ready to take the next step and he wanted to move to my state and he ended up purchasing a branch which is kind of like my dream property for about a million dollars paid cash put me on the deed and prior to that I said you know I don't feel comfortable doing this unless I am unless we were married at that point he was like nope we're going to get married a venue was booked, a ring was purchased, and we move forward. He moves in for about three weeks and then

tries to almost trick me into signing the deed of the house into a trust while he's like planning his exit, and he left. So, which whole other set of emotional issues. He paid, he paid cash he did of a million dollars for a property yep and put your name on the deed

yes sir and then he took off yes sir wild so I don't understand how he profits from this it almost sounds like he was trying to scam is he just flighty or what

I I think he has some I think he wants he liked the idea of this and I think Broke your heart in the process. Broke my heart.

I'm left to manage the whole 20 acres on my own and six animals. It's not your house. It's not my house. It's his million dollars, right? Yeah, but I'm on the deed. So technically I am 50% owner and my home, I rented it out. And I have tenants in there through the end of May. Oh, my gosh.

Okay. Is he asking for the property back at all? Like, are you guys going to sell? He tried to, like I said, like when he was planning his exit before I put all the pieces together, he said, oh, someone's going to contact you, you know, to put the house in a trust to protect you in case something happens. How long has they been going? Six weeks. Okay.

All right. Wow. okay um i am trying to figure out what my goal should be in this situation should i say okay let's list the property but before it's listed obviously have it worked out and i mean my life flipped upside down has he been in contact with you since he left um we we spoke once and that's when it was basically like, this is over, we're not doing this. It's so interesting. It's usually him calling us, Rebecca, being like, crap, I bought a ranch with my fiance

who I'm not with anymore. What do I do for my million dollars? You're sitting there on a half a million dollar windfall because this guy's loopy. Yes. So, do I buy him out? That's a good question. No, I wouldn't buy him out. You I take, you know, I obviously will work with attorneys to have the paperwork

drawn up. So the property is listed and there's an offer. we have a plan in place as far as you do so at the last minute well we would that would be my goal if we list it would be to have everything written out there's no question i think this guy's an absolute i mean the the story you've told me he's an absolute crazy man um and weird and and everything else i'm very sad i'm very sad about yeah and and i bet it was great though rebecca and yet and yet in your shoes. I don't feel entitled to $500,000 of his money. I don't feel that way. I feel like I questioned that, but I quit a job. I uprooted my entire life and this gesture that he made

was to show his level of commitment and his seriousness for the relationship. So what were you making at your job? About 100. Can you go back? I cannot go back. there, no. Okay. What were you doing? Um, I work in, um, private aviation on the kind of operation side. Okay. All right. Um, well, obviously you're going to have to get a career going forward. I do have a do. I do. I do. I do. I did get another job. Thank you. What do you make? What do you are. You making a hundred. Okay. So other than the time off in between that you did not benefit from, how long, how long were you out of work? Um, a couple months. About three months, but this current job is not as stable as a company as my previous one, which makes me...

So your point is you've been damaged by this fraud, and so, financially, and so it would be ethical to receive something for that. I don't know. I think that's right. I think, you know, it costs you, it costs you a good job. My home that I had. Well, no, you own the home still. Right. You'll get it back in May and, you know, and you will have rented it.

You will have made money on it during that time. So I don't mind tagging him for $100,000 or something. I just don't, I don't know how you've been harmed much more than $100,000 unless you want to just be punitive, which honestly is probably okay. This guy kind of deserves it, but I'm kind of with you. I mean, I'm vacillating while I'm talking to you. You hear me? So I'm not sure. This is weird.

And you, as you know, so, and you're not the weird one. so um yeah okay i don't want to i want to be made whole financially plus a little if i'm you past that this is dirty money for me right i i got and i don't want to live on this farm this ranch that's that's got bad juju all over it right right if i'm you i'm just i'm just yeah i don't I'm going to put myself in your shoes. Yeah. Get me out of there. Yeah.

I don't want to, I don't want to walk away with. And legally, you're entitled to half a million, legally, right? If her name's on the deed. Nothing this twerk can do about it. But the question is, what do you feel right about, right? From just like a moral perspective. And that's the being made whole plus a little bit more. I would, do you have an ability to contact him?

Mm-hmm. Yeah, I would have your attorney contact him and say, I will sign a deed to you for $200,000 or whatever the number is and then I would go get an apartment and sell off the animals and get out of this get away from this whole thing and then go back to your and go back to your house in May when the text moved out I just I would just get away from the whole thing anything that anything that keeps me in this story is disturbing I want to get it out of this story it's a bad story emotionally that's probably the best no I mean just generally I think it's probably financially because it's just it's it's you're distracted by evil stuff

did y'all did y'all date long term Rebecca for two years for two years for two years long term long distance but it was a bit of a roller coaster long distance and this was like the okay he's going he he wants to commit he wants to take the next step he he's ready to move over there's almost a level of like mourning this life that kind of whipped up really quickly for you you know what I mean Like, I mean, I know you guys were in a relationship for two years, but him moving, buying your ranch, you moved, you quit your job. I mean, you had a world win within 90 days of this life that was ahead of you. And then it's gone as quickly as it came is what it feels like.

So there's, yeah, some whiplash for sure. There's a whiplash penalty. I'm willing that he should pay. I'm fine with that. And anything that he actually cost you, which is probably 100 grand, give or take. And then a whiplash penalty of whatever you want to put on it. And I'll sign the deed for that. it sounds like he's got money

he's got a couple a couple mill yeah so he could write you a $200,000 check or whatever the number is you've got in mind and you just sign the deed and we're done get the animals sold off so they're not hurt because he's not going to come back and feed them

you gotta make sure they're gone right and so and I would put this whole thing way in the rear view mirror if I if you were my daughter that's what I tell you to do sucks sorry Rebecca that's awful

August is national make-a-will month. Like we needed a month to do that. But there you go. Why do people not make a will? Well, number one reason is procrastination. 43% of adults without a will say they just haven't gotten around to it. Perfectionism is number two. Writing a will involves big decisions and dealing with your family.

That's not perfectionism. That's avoidance I don't want to deal with that I don't want to deal with that Or her or him Thinking you need a certain amount of assets Before you get a will Now you don't

You just need to be 18 And care that the government Doesn't conduct your affairs for you Like where your children go if you die A belief that everything Automatically goes to family It doesn't It goes to the lawyers

Sons uncertainty about the process Many people say they just don't know how or where to start wheels can be confusing but our team is here to help you can take our wills quiz to find out if a simple online will is right for you at ramsysolutions.com slash wills quiz andrews in Columbia Missouri hi Andrew how are you good how are you doing Dave better than I deserve what's up um so I own a pool cleaning uh repair and resurface company here in Columbia um I am I'm in a partnership with another guy.

We started the business about three summers ago. I had previous experience with a pool company here, one of the bigger ones here, and I decided to branch off, you know, do my own thing. Started pretty small, so me and my partner, we started doing, you know, power washing, window washing jobs, pool cleanings, you know. We didn't have too many clients, probably about 10 to 15. Um, you know, fast forward to the, why did you need a partner? At the time, so I had, I, I, I, I, technically I didn't.

Okay. And now you've learned the partnerships are the only ship that won't sail? Correct. That's correct. I'm guessing you, you two guys did not do anything like go to a lawyer and have a partnership agreement drawn up. Um, initially no, uh, that happened later on. And it was. pretty much too late by, you know, by the time we did make one. Why was it too late? What's happened? So basically, we started sub-last year, we started subcontracting for this, the pool

resurface company that we actually bought. My partner, he was, it was owned by one of his uncles, his uncles was higher up there, made good money. Anyways, last year, though, I got connected with one of the, my old managers, that I actually worked with at the old pool store I worked at, and I said, hey, what do you think about coming over here? I'll, you know, pay you decent and we'll, you know, basically start taking a lot of the clients that, that pool company that I used to work for has. So I probably took half of their commercial neighborhood pools, plus, I don't know, 10 residential, and commercial ones have to be done three times a week, so those come out to 60 visits a week, plus

repairs. Um, anyways, when we were, when, anyways, I had that, that happened last year as we were doing the pool resurfacing. So I got connected with that. Um, at the time, that business, basically after we got done subcontracting for them, they said, hey, what do you guys think about buying this? Um, you know, obviously it was connected with my partner's family, so he was all about it. He wanted to do it all this. And I said, hey, I was like, how about we just buy the equipment and we slowly build. He disagreed with me, and I eventually just gave in because I, you know, I was like, well, maybe this will work out, so I gave in, you know, and I was nervous about all of it.

So anyways, fast forward. And out of this year, you know, pool, I'm basically running the pool repair and pool cleaning side, and, you know, for example, last month we brought in about 49,000 revenue. Um, the coat your pool side, he is supposed to be running and he, he's done probably two jobs in the past three months and has brought in, you know, we haven't profited anything from it. Why is he not working? He's, he, uh, confronted him about. I said, hey, we need to push this harder. We need to do this. And he basically, he has, he has a kid with his girlfriend and he basically, every time I bring it up and say, hey, we need to make more money. We're losing money right now, actually.

He just says, you wouldn't understand. You don't have a child at home. And things just get awkward after that. And, you know. So what does a partnership say about dissolving a partnership, about dissolving it? You have the agreement, right? Yeah, so our agreement's very vague, unfortunately. Yeah, that's what I've actually.

Yeah, I'm talking to a. What did you, did you go into debt to buy this crappy business that this crappy guy's running? Yeah. Yeah, so the business was $260,000. They basically said, hey, we won't charge you any interest. Basically, a five-year plan, you'll pay $4,000 a month. We'll do all your marketing, get all your jobs the first year. When I heard that, I was just like, initially I was like, oh, I don't want to do this.

I express it to him multiple times. I said, this is dangerous. We're going to. But you did it, Andrew. But you did it. Okay. You're correct. And so you didn't walk away, even though you knew you were supposed to walk away.

So the prudency danger and seek refuge, the simple sea danger, move forward and pay a penalty. And I've been simple and move forward and pay a penalty. So how are we going to get out of this? You owe these people $260,000. It's his uncle. Well, his uncle let you off and let him just give him that part of the business. You take the other part? So the deal with the businesses is that we can give the business back at any time.

and we oh we can keep the money we made and that is that we can just give it back and there's no more debt problem is he doesn't you know partner doesn't want to do that but he's also not working yeah no no no no no no no no no no no no no no no I want you to call the people back and say I'm going to give you my portion back and then deed his portion your partner's portion to him let him have that business and you go run your other business right Right. Yeah. So I let him sit over there in his own poop. Yeah. Get away from it, Andrew, if you can. You got to get out of this. Yeah. Walk away. Yeah. Well, what I, what I do right now, I really enjoy, too. So, you know, I wake up, you know, excited every day.

Just take, take your portion of the business. He signs off and says, this is your portion. I'll take, you, you can have the portion that your uncle sold us, and you can have the debt, and you can have, you can make all the money in the world. Good luck. And you just turn my stuff. turn this over here loose to me, and I'll take this, and we're splitting up. Okay. And if you don't do that, I'm going to hire a lawyer and sue you. Yeah. Because you don't work. How old are you guys, Andrew? I'm 26.

I'm 24, and he is 28. Like I've done this before. Okay. Yeah. So, rule of thumb is, never do a partnership. Right. If you are dumb enough to do a partnership, you have to have thorough. partnership agreements that deal with when one of the partners is not performing or doing drugs

or dies or gets disabled or gets divorced and you don't want to be in a pool business with his girlfriend, okay, or whatever. So all that, man, you don't have any of that. So you're screwed is where you are. But if you can go over and sit down with him and go, look, I'm so pissed off I can't see. This isn't working. I want you to take this whole thing and I'll take this whole thing and I'll sign over my part to you and you sign over this part over here to me and if you don't do that i'm going to go

get a lawyer and sue you because i'm not going to live like this anymore it's not working for me and you have been too stinking nice to tell people the truth and too nice to stand up for yourself andrew of what you know is right or right so right let's uh this is your time where your backbone gets uh installed okay right yeah yeah yeah Yeah. So I have actually written up. You're not going to do it, are you? No, I have some, I have already something written up. I'm just, I don't want to write anything up.

I'm going to go sit down and have a cup of coffee and go, dude, I'm going to sign over this whole thing over here to you. It's going to be yours. You're going to sign this whole thing over here to me. It's going to be mine. We're not working together anymore. This is how this is ending. I'm done. Yeah.

I didn't want to be in this in the first place. Your tone could be nicer than that. I don't know. But be done. At least in your head. Be decisive, Andrew. Clear. Clear and decisive. And don't talk about all the stuff in the past and all that. All that matters is you're fired. That's all that matters. Our scripture of the day is Philippians 4.6. Do not be anxious about anything, but in everything by prayer and supplication with Thanksgiving. Let your request. be known to God. Teddy Roosevelt said complaining about a problem without posing a solution is called

whining. I love it. All right, Matt's in Colorado Springs. Hey, Matt, what's up? Hey, Dave, hey, Rachel. How are you today? Great. How can we help? Yes, sir. So, I've got a debt collector on my back, and it's for a relatively small amount, and I've heard you talk about debt collectors and they're scummy kind of tactics and stuff, and I've never experienced this. So I was hoping you could help me. To make a long story short, my wife and I, we've been married about a year and a half now. We had about $38,000 worth of debt. Nine months ago, we're down to 17.

We're trying to work through babysat, too. Nice. She had a credit card, I guess, that before we got together, she had. And when she was 20, I guess she decided she didn't feel like paying it back, and here it is. And I didn't know it was there. what's the balance hanging around it's only $2,300 but the first time we've ever been contacted about it they sent us a Manila envelope to her old emailing address that had like legal documents like they're going to take us to court over it oh that's a bluff we never got a phone call

text message anything if they were going to take it to court they would have done it a long time ago it's been five years so it's been sold to a debt collector obviously so you know I've called them and I've taken your advice I haven't given them I've given them barely any information about us and I've haggled them and they've told me final offer three times and the best deal they're willing to cut me at this point is sick after three hours of haggling with them and 17 different people have them passed to is 1600 bucks now I don't know if it's worth just paying the 1600 but that would be my emergency fund plus we do the OG cash folders my wife loves your wallet rachel so we got a wallet pull of some grocery money and stuff nice so that would be all

that money I just don't know if it's worth haggling them some more calling their bluff or or just paying them and moving on How much you guys make a year, Matt? I'm a UPS driver. She's a dental assistant. I make between the two of us, she just got a raise if I work overtime. I'd say we make before tax maybe 70,

I'm sorry, 95-ish between the two of us right now. Okay. All right. So is this the next item in your debt snowball? Well, this was an unexpected thing that just popped up about two days ago. So we actually... You've had 17 conversations in two days? Well, I've got Bluetooth headphones and 10 hours a day of slinging cardboard that I can

argue with somebody all day if I have to. So this whole thing stretched out over two whole days. I mean, the first time, I guess maybe this makes more sense. Back in her old mailing address, when this all happened was her parents' home. Back in February, someone pulled up to her parents' home asking for. we didn't know what that was about and they didn't tell her parents any information and then about three days ago someone pulled up and just handed her mother the manila envelope or the manola folder but to your point you've only been in contact with them for three days is what yes man yeah yeah

yeah let let it sit okay just turn it off the the paperwork says September I think 12th or 18th and you know and that's when it's supposed to be officially filed with the court that's fine but I just don't know how serious to take that I wouldn't worry about it okay what would you recommend i do just keep haggling them until i get a better i would call back when you've got the money to settle it and you know what you can settle it for a thousand dollars today right i've i tried i mean i told him look i'm doing the i even said i'm doing the dave ramsie plan i don't have a lot of liquid access i got a thousand dollars take my money and they said no that's ridiculous we can only come down 25 percent and after some lady yelling at me

for 30 minutes on the phone she she said she pulled the whole car salesman tactic. Whoa, whoa, whoa, whoa, whoa, whoa, whoa, whoa, whoa, whoa, stop. Okay, next time you talk to them, if they say something in an inappropriate volume or inappropriate words, say, if you do that again, I'm hanging up. Okay. And then hang up. We're not going to have anybody yelling at me for 30 minutes over $2,000.

Okay. Just hang up. Okay. That's a tactic. Yeah, I still want to wind up in a situation where I'm in a courtroom now. You're not going to be in a courtroom. You're not even going to go. There's no point in going.

You're going to lose. she owed you not you but your wife she owes the money open and shut case she loses now you're settling a judgment lien and not a debt whoopty-dipty it doesn't matter it's a five-year-old debt they're saying they can come at us with all their fees and they can come at all that if I choose to pay it but until you choose to get a hold of me and you're not going to get it because you don't even know where we are and make sure that her parents don't give out any information if anyone comes to their front door and tell them if they come up on my property again we're going to have them arrested for trespassing okay so

they're really just trying to scare me and turn on me 100% now they're trying to piss you off okay if they can get you very afraid or very angry you quit thinking with the proper parts of your brain and you just want to kill them okay that's why they yell call them some more or you think I just know let it let it sit a week let just sit a week. Yes, sir. Call them back and say, you know, I talked to somebody over there. They were a moron.

And I know what you guys paid for this. You probably paid about $100 for this debt. And I'm willing to give you $1,000. That's all I've got. If you want to take that, fine. If not, there's not going to be a lot of discussion here. Do you want that or not? Yes or no.

If you don't speak reasonably, we're going to end the conversation. Why, we're going to end the conversation. Okay. Call back the next day and do it again. and you're gonna you just it's like training a dog i mean you just have to do it repetitively right yes i just my dog's got a shock collar so there you go that's it that's it just just hit the shot collar and eventually the dog figures out we're not doing that crap right and so you have to train these morons because their training has taught them that if they are unreasonable angry

fear-based anger based that they can get you thinking with the lizard part of your brain instead of the higher thinking parts of your brain, and you do irrational things like give them the money out of your food envelope, which we're definitely not going to do, dude. But you make $95,000 and you do need to get this cleared up sometime between now and Christmas. So just get, you know. You're going to pay something to get it out. And, yeah. And if you pay $1,600 between now and Christmas and you've actually got the $1,600 by then,

that's fine. You're okay. But you don't need to wipe out your emergency fund for it. You're giving this way more attention than they are. So just back off. Just let them sit. Just let it sit for a week and call them up. And if you can have a reasonable conversation, fairly short, yes or no, you want to do this.

It is always fascinating that it's been five years. Yeah. And it just... And now we're going to sue you! Yeah. Where the flip were you before? Yeah. So just remember that.

Yeah. I mean, is it that? It just sits there, it gets sold all of it, and it just happens to be the file. And they grab that file and next is next. They're just working. It's a widget on the... on the conveyor belt. Yeah, yeah.

And so the time is always so random to me. Yeah. Five years later. It's crazy. Yep. And, you know, we know that this can be done. We bought $10 million worth of bad debt and forgave it all one Christmas. It was 8,000 accounts.

Each of the 1,000 people that work here had eight people to call and say we forgave the debt in the name of Jesus. And we paid $2.5 cents on the dollar for it. I bought $10 million worth of debt for $250. 59,000, okay? And so, and it was all accounts just exactly like this. And we just called them up and said, your debt's forgiven in the name of Jesus. And some of them were like, I don't remember that. To this point. It's been so long. Yeah, it's been so long. You remember that hospital bill you had from five years ago that was $42 and now it's 486? Yeah, there you go. That's it. That's the whole, the whole business work. But good for you, Matt, you and your wife doing

this. I'm glad you're working through it, man. I mean, yeah, y'all are doing the land. Let me tell you what you're doing right. You're being very proactive. Yeah. That's what you're doing right. The thing I don't want you to do is fall into the trap of letting them control the narrative and the conversation. So give a little more space in between, even though you've got the time to sit on the headset and throw boxes, don't do it. Okay?

Let them sit over there and wonder if they're ever going to find your wife because they don't know where she is. And we're going to settle this for $1,000. and that's going to be a really good deal for them and a really good deal for you. And you get it in writing and no electronic access to your checking account or you do not send a debt collector money because you can tell they're lying if their mouth is moving. That puts us out of The Ramsey Show and 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.