The Ramsey Show - App - Stop Being Sloppy With Money (Hour 1)

Episode Date: July 27, 2018

The show about you

🎵 Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. You jump in, we'll talk about your life and your money. It's a free call at 888-825-5225. That's 888-825-5225. Jennifer is with us. Jennifer's in Jacksonville, Florida. Hi, Jennifer. How are you? I am great and blessed. How are you? Better than I deserve. What's up?

Well, I have a bit of an employment question, really. So I have hit a crossroads. I was let go in June, and I do IT for a living. Not always most fond of IT, but I like it. It's okay. But I also have an opportunity to do something that would be a short-term pay cut, but in the long run make as much, if not more, than what I make now, believe it or not, would be dog grooming.

And the opportunities have presented themselves. I have five job offers. One is a temporary IT contract for four months. The other four are permanent positions with full-time employment to learn and do the trade and become a dog groomer. I know it's a strange question, but I'm just trying to make the right choice financially to continue going. By the way, I'm on baby step two. Gotcha. Okay.

So what will the contract pay, the IT contract? The four-month contract is going to pay about $20 an hour. And you get 40 hours or what? Yes, it's 40 hours a week. It's just a temporary thing. They needed extra help as they go into a transition. They have not guaranteed anything past that. Got it.

What type of IT do you do? Mostly help desk, desktop support, and I also set up machines for people when they, new people that come through. Gotcha. Okay. And what does the dog grooming pay? Sadly, in the beginning, it's going to be half of that. The process is you go through an academy that they have for about a month, and you begin to move on to commission work, which is each animal that you touch, you get half of what they charge. And that can be...

That's all three jobs are exactly the same? Yeah, the other four jobs are the same. All the dog grooming jobs have the exact same pay and the exact same deal. Yes. That's kind of weird. The only difference between them is that two of them offer health benefits. Okay. The other two

do not. And how many hours can you get? I can get 40 hours a week just out of those jobs. Can you get more? I probably could get more. You're going to need it. Oh, I'm sure I would if I was going to take that route. If it was going to pay $10 an hour for the rest of my life, I don't think I would even

touch it. No, I would tell you that's stupid. I wouldn't even consider it. So how does it not pay $10 an hour later? Once you reach commission, commission always sounds bad, especially for sales. But once it reaches commission, you make half of what they charge for the dog. So if the dog's getting $60 worth of work, you get $30 of that. If you do anywhere from, you know, 10 to 12 a day, you have a potential to get up between $30,000, $40,000 a year. How old are you?

Of course, it's a skill. It comes with time. It takes usually about three to six months to get about that good. How old are you? I am 36. When you're 46, is that what you want to be doing? Believe it or not, yes. Okay. It sounds bad, but, you know, like I said, I'm just trying.

I mean, it doesn't sound bad, but it just sounds kind of limiting. I mean, if you told me you wanted to own a whole chain of dog grooming stores by the time you were 50, that might be less limiting or have your own shop. Well, the goal is to be self-employed doing it. Actually, my husband is actually very supportive of the idea of me doing it on my own because you actually don't get commission there. You get 100% of what you do. But you have to keep the jobs lined up. You do get the jobs lined up.

You have to stay busy. I mean, if you sit on your butt, 100% of nothing is nothing. Oh, no, you can't sit on your butt at this job. I know. I'm saying. You are in charge of how much money you make, basically, in this business. I already do dog training. I have a side business, and I already do dog training on the side.

And it's nowhere near as lucrative as doing grooming for yourself but if i had to make this choice extremely quick about uh doing the taking the the permanent grooming or the temporary contract that's where i'm stuck at right now what is your husband like uh 67 000 and how much debt do you all have, not counting your house? Not counting the house? I have my car, and that is about $20,000. That's where mine is. He takes care of his own finances, and he hasn't really shared with me,

except for he does have a credit card that is about $20,000, and he has two mortgages. One is almost paid off. It'll be paid off in a couple of years. Yay. The one that we live in and one he purchased for, uh, for his mother, uh, that will be paid off once she moves up here. So, but, um, as far as like, he doesn't share all of the details of his debt, other than the fact that he's strapped, is what he tells me. Okay. And how long have you all been married? About three years. Okay. You have a huge problem there in you all having not combined your information, your knowledge of each other, and your goals.

Let me just tell you, all the data that we have of 30 years of doing what I do, almost no married couples become financially successful with separate finances. No, and I see that myself. I've been gently kind of nudging him in that direction, and I'm not going to bite. Yeah, gently is not over. I mean, gently's over. This is just dumb. You guys need to finance.

You need to, you know, because it changes whether or not you have a support mechanism, you know, from your husband. It sounds more like you have a roommate. an $87,000 versus a $107,000 household income that as a group, the two of you can pay all of your bills while you make a career transition. It makes it a lot easier for you to make a career transition. So I don't have a problem with what you're talking about. I'm not sure your car stays in the equation either. It probably needs to be sold, especially if you move down to $20,000 a year. Doing dog grooming, driving a $20,000 car doesn't fit in that equation probably. This is the Dave Ramsey Show. Guys, let's talk about that timeshare pitch that you fell for.

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Now, I know I'm just adding salt to a very old wound, but look, if you tried calling the resort and they won't take it back, if you tried selling it and no one will buy it, call Timeshare Exit Team. Timeshare Exit Team will get you out. You'll have to be patient. It can be a long process, and it costs money, but it works. They're so confident in their

exit service that if they don't get you out, you get a 100% refund. Call 844-999-EXIT. It's free to talk. 844-999-EXIT. TimeshareExitTeam.com. I'm giving you the same financial advice your grandmother would, only we keep our teeth in. This is the Dave Ramsey Show.

Thanks for joining us. Open phones at 888-825-5225. Jonathan's with us in Jackson, Tennessee. Hey, Jonathan, how are you? Good. How are you, Mr. Ramsey? Better than I deserve, sir. How can I help?

Oh, I had a question about my company's 401K. Been listening to your program for a while, and I noticed you want it to be distributed over growth, present income, aggressive growth, and international. Yes, sir. It looks like my company only, it doesn't have anything for me to put in aggressive growth. Mm-hmm. So my question was, should I put that other 25% of it in one of the others, or should

I split it over three? Mm-hmm. Well, three is fine, or you can just double up on the growth if you wanted to. You don't have anything that says small cap or emerging markets or – It does have some small cap. It broke up into a category that says small cap. I didn't know if that was the same thing. Yeah, small cap isn't aggressive. Cap means capitalization.

Small cap means small capitalization, meaning a small company. And the smaller companies are usually startups and or more volatile companies. And that will qualify as your aggressive growth. If you have one of those that has a good track record, and in the last, like, five years, it should have a good track record. Or if you go back and say the last 15 or 20 years, if it had that long of a track record and it's got a good, strong track record, I would go with that as your aggressive growth. So, hey, thank you for calling in, Jonathan.

Megan is with us in Columbus, Ohio. Hi, Megan. How are you? Hi, good. How are you, Dave? Better than I deserve. What's up? So before I started listening to you, I made the huge mistake of leasing my car.

And I wanted to know what your thoughts are on whether or not it's worth getting out of or just sticking through it and then never leasing a car again. Yeah. Well, it'll depend on the numbers. How long is the lease and how far are you into it? It's a three-year lease and I have 21 months left. Okay. And how much is the payment? Every month it's $285,000 and the buyout right now is $20,000

and then it's only really worth $13,000 on Kelley Blue Book. You're driving it. Okay. You're driving it all the way out. Because if you sell it for $13,000 or $14,000 and the buyout's $20,000, that's $7,000 out of pocket. Okay? And you've hardly got $7,000 out of pocket in the next 21 months. And so you either write a check for $7,000 and give up the car, or you write a check

for $7,000 over the next 21 months and drive the car during that time. So if we're going to write the check, we might as well get the use of the car. You follow me? Okay. Yeah, that's what I was thinking, but I wanted to double check. Yeah, that is going to be the right way to do it. Drive it all the way out. But now here are two things. One, you said the correct thing, and that's never do it again. The second thing is what are you going to do at the end of the lease? You need to have a plan for a car. Okay. And I guess the third thing is make sure you're not doing something to run the miles up

because you have to write a big check if you're up over your mileage and wear and tear on the car if the car is getting dinged up and stuff, they're going to ding you with a fee at the end of the lease for mileage overage or excessive wear and tear, they call it. And sometimes they mess with you on both of those things. So just make real sure that you're turning in a pristine car that is under your mileage allotment. That way you don't have any more checks to write and that you have a place something to do to drive you got something figured out what you're going

to drive at the end of this time that you're going to pay cash for so you got 21 months to figure that out that's what it comes down to but you're correct this one mathematically you're better to drive it on out you're going to write the check either way is what it comes down to. Justin's with us in West Palm Beach, Florida. Hi, Justin. How are you? Well, Dave, to be honest, I've been better. Uh-oh. What's going on?

Well, I'm a newly licensed real estate agent, say, in late February, early March. And I honestly, I went into it, I think, head on too soon because I did not have a lot of money going into it. And now I am upside down, can't even meet my bills. And I've got from just personal debts, I have over $20,000 in debt. And my parents are basically having to help me with my bills. And at 37 years old, I did not sign up and think I'd be like this. So what would it take to barely get by where you didn't need, what kind of income where you didn't need help? Just barely. I would say probably at least like maybe 30 grand and I'm just

guessing off the top of my head maybe 25, 30 grand. Okay, so $2,000 a month $2,500 a month2,300 a grant. Okay. So $2,000 a month, $2,500 a month? Yeah, roughly a different age, yeah. Okay. So what can you do to earn that while you get the real estate business going on the side? Okay. I've actually taken, I just took a part-time job doing something at night, like a call center thing, a job. What's it pay?

And then it pays like $10 an hour. Yeah. Is that going to meet your basic nut? Well, and I also started driving for Uberber a little bit so i'm guessing that and uber might um but uh and you know i'm getting flack from my parents like why did you start doing this but uh you know why did you start doing this because i'm broke well no i know i'm talking about the real estate thing yeah they're like oh it's not a career you know know, and it's just, I don't know. Well, it is a career.

People make hundreds of thousands of dollars a year doing it, so it's a valid career path. It takes a while to get it going, and you obviously have not unlocked the box of money yet, right? Right, right. But other people do, so I can tell your parents why you got into it. It's a fun career, and it's very lucrative for those who do well at it but obviously you've not gotten there yet so you got a backfill till you get there um and it might be you know so what my first step would be this i would you know do what you're doing take six extra jobs and then work real estate you know during the day kind of thing

and work your other stuff evenings and whatever you've got to do around it to at least keep the wolf away from the door and at least keep from having to go to mom and dad for money. Then the second thing, stage, is if you don't get some real estate deals moving, some listings and some sales in the pipeline within about 90 days from now, if you don't have a couple of deals pending, okay, of some kind, either a listing or a sale or two or three within 90 days, you probably need to look at landing back in a full-time job thinking, I'm going to work real estate on nights and weekends until I can get my real estate feet under me.

And someday, once I get that going, it might take two or three years, then I quit the full-time again. Right. But I don't want you to do that. Let's give it the summer, kind of, you know, the rest of the summer, 90 days up into the fall and see if you can turn this thing. Okay. But if you can't turn it, then, you know, by Thanksgiving or so,

you've got to start thinking about landing something more permanent. But good news is part-time real estate is not a bad way to start it because when you're working a full-time job during the day, most people want to look at houses or even talk to you about listing their home at night or weekends. And so you don't really lose a lot of productive time in terms of time in front of a client by not being available during the weekday.

And if you had an out-of-town client coming in and they wanted to look at houses all day on a Thursday or something, you either take a vacation day or you get one of your buddies there in the office and split the commission with them if they make the sale for you and you hand it off. But you still make it happen. And so that's what I would do. But I think you went into this thinking you were going to make money quicker than most people do and quicker than you have.

And so it's caught you from behind is what it amounts to. First thing is get the wolf away from the door. Second thing is decide if you need to make a transition or not good call sir we appreciate you joining us you can do this you can do it it's just gonna it's just a matter of how much time and how much effort and those are the only two things we don't know and you you know but you can do it i know that because other people have done it i've done it for that matter i made a money made money as a residential real estate agent that's what i did when I was in college. Sold houses. And made a living, actually.

There you go. Go figure. A million years ago. But still did it. This is The Dave Ramsey Show. Thank you. I get asked all the time, when in the baby steps is the right time to buy life insurance? My answer is typically now. Life insurance is not part of the baby steps because it's needed when your family has debt and not enough savings to provide for their financial needs.

That's when they're at the highest risk. And no matter where you are in your baby steps, it's a necessity, not a choice. This includes working husbands and wives, as well as stay-at-home parents. It's pretty expensive to replace those stay-at-home parent responsibilities. I only recommend term life insurance, since it's the most affordable way to get the right amount of coverage and not break your budget. Go to Zander.com or call 800-356-4282. These are the guys I personally use. Term life insurance is inexpensive and your family needs this no matter where you are in your baby steps.

That's Zander.com or call 800-356-4282. Zander.com. In the lobby of Ramsey Solutions, Aaron and Hannah are with us. Welcome, guys. How are you? Good, Dave. How are you doing? Better than I deserve. Welcome, welcome. So, where do you guys live? We live in Leon, West Virginia, which is about an hour from everything. So about an hour from Charleston.

What, north, south, east, or west from Charleston? It's north of Charleston. North of Charleston. Okay. All right. You're not far from Ramsey, West Virginia, which there is not much there. It's like not even a really wide spot in the road. Yeah.

Cool. Well, welcome. Good to have you guys. So what do you, how much debt have you guys paid off? We paid off $36,000. Good. And how long did that take? 12 months.

Good for you. And your range of income during that time? $93,000. Wow. And what do y'all do for a living? I'm the executive director of a skilled nursing facility. And I have my CPA license, but right now God's blessed us and I'm able to stay home

and take care of our son. Oh, very fun. Good for you guys. So what kind of debt was the $36,000? We had two vehicles that we both purchased new vehicles before we got married. So we brought those into the marriage and we had a $6,000 medical bill for the birth of our son. And during our debt-free journey, I had to have an emergency procedure completed and that was another $6,000 medical bill for the birth of our son. And during our debt-free journey, I had to have an emergency procedure completed, and that was another $6,000. Oh, okay. So a medical bill popped up in the middle of it. Yep. Okay.

Wow. Wow. So how long have you been married? We've been married five years in January. Coming up on five years. What changed 12 months ago that made you decide, okay, we're cleaning this up? Well, it's kind of a slow journey. In 2014, when our son was born, we got that $6,000 medical bill the way our health plan is structured.

That was our deductible. Exactly one month after his birth, the car that my wife had when we got married, a car we really loved, it broke down. And the repair bill for that vehicle was going to be $5,000. And we simply could not pay the repair bill for that car. So we ended up having to trade in a car that was $5,000 less valuable than it was the day before. And we plowed what we owed on that vehicle back into the loan for the next vehicle that we bought. So through 2015, we were kind of living this life. It was getting a little bit tight because my wife wasn't working, and we were throwing money at this

thing. We just decided we needed to do something to get out of this hole that we were in. So we talked about Financial Peace University. I was introduced to you through Entree Leadership. Great book. Absolutely love it. So I was telling her about your show, and we said, we need to do this class. So what we decided was we're going to do this class with a group of people from our church. So we started to advertise this class. I'll be honest, we didn't get a whole lot of response at the time. So we decided, well, we really need to do this for ourselves. So we bought the home class, and in March of 2016, we sat down in our living room,

and we started this class. And we really just started budgeting, finding money in places that we didn't know. As you've talked about, when you start handling money God's way, he will bless you. We were blessed to receive some money from an unexpected area, and we were able to just throw money at this thing. In August, I had the emergency procedure completed, and that could have really derailed us because that was $6,000 that we didn't expect, but we just plowed that thing into the snowball. Man, you guys are like personally keeping the hospitals open.

Pretty much, yeah, yeah, and we're getting ready to do that again in September. Well, congratulations on that part. Yeah. That's a good visit to the hospital. It is, it is. Wow, how fun. So, really, it sounds like stuff just kept happening until it piled up deep enough we had to do something about it. Yep, Murphy's Law, that's right.

That's what it came down to. So what do you tell people the key to getting out of debt is? Well, I think that the key to getting out of debt for us was just sitting down, committing to it, and then planning ahead. I'm more of a free spirit, and I like to just spend money when it comes to me. I like to give money away. And so I had to control myself and rein back. And doing the budget was really helpful in that, making sure that we knew where our money was going and how we were spending it. Gave you guidelines. Yes. Very cool. Good for you. Okay. What about you, Aaron? What do you say? Well, it sounds really simple, but the key to getting out of debt for me is just do it.

I mean, at some point in your life, you sit down and you decide that you're going to live in debt. And at some point in your life, you just have to sit down and you have to decide, I'm not going to live in debt anymore. I'm going to do this. And for me, Dave, it really kind of hit me as a man, as a father, that I didn't want my family to live this way. I've heard you say a thousand times that people say, oh, you're always going to have a car payment. And I've heard that, but that's not true. If you can get out of this hole and live debt free, that's what a man does. You take care of your family, and that's what I wanted to do was to take care of my family.

And we're so blessed. We're going to have another one in September. And we're going to sit down and write a check to the hospital, and we're going to keep living debt-free. Exactly. That's wonderful. Man, that's awesome. Very well said. Very well done.

Congratulations. How does it feel? Great. It feels great. Have you ever been debt-free in five years of marriage until now? We have not. You know, we were doing what we thought was really good. Both of us were very lucky to have scholarships in college, so we had just a very, very little amount of student loans. We paid it off before we got married. So, you know, we thought we were doing really well,

had a mortgage and two vehicles, and then things just started happening and just keeps piling up until you just decide, I'm not going to do this anymore. Good. Congratulations, you guys. And you brought the little guy with you. How old is he and what's his name? His name is Porter, and he turns three in September. Okay. Three years old in September.

The day after the due date for our new child. I'm going to have two September birthdays. Yeah. All right. That's fun. And I just want to say one more thing, Dave. We were really blessed by a couple. It was my wife's godparents, and they passed away within about six months of each other.

Her godmother passed away in January, and we received, I'm not going to say a lot of money from them. It wasn't what got us to this point, but it was enough to kind of put us over the top. It was an encouragement. It was. We looked at our bank account on my 30th birthday in March, and a check that had come in from them had, I looked at the bank account, and it was a higher number than what we owed in debt. And I'm like, you know, we can now pay this off. Wow.

And we sat down on my 30th birthday and paid it off thanks to their legacy and their blessing. Yeah. And now you're in a position to be able to do the same thing someday. We are, and it's a wonderful feeling. Love it. Congratulations. All right, Aaron and Hannah and Porter, $36,000 paid off in 12 months, making $93,000 a year. We've got a copy of Chris Hogan's book for you, Retire Inspired.

We want you to be millionaires next and outrageously generous as you go along. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! I love it. Well done, you guys. Very well done.

That is exactly how it happens right there. Ah, love it. Those never get old. Our question of the day comes from Blinds.com. They have a 100% satisfaction guarantee, which means even if you mismeasure or pick the wrong color, they will remake your window blinds for free. Blinds.com, you get free samples, free shipping, and promos all the time.

Be sure you use the promo code RAMSY. That's magic right there. It'll get you the best deal. Steve is in Louisiana. Do you recommend landlord insurance? I've heard several horror stories about tenants causing massive amounts of damage to property. Is this a good way to protect myself i own a whole bunch of property and i don't own any landlord insurance um my landlord insurance is called tenant screening

we spend um my son-in-law runs all of our rental property and management company that he has and um they spend i should say I don't personally do it, but they spend a lot of time interviewing a tenant, almost as if we were hiring them for a job and verifying that they are not the kind of people that are going to tear something up. Oh, and we inspect the property regularly, inside and out. And we don't allow pets. We love pets.

All of us have pets. But we don't have any in our rental property. Because some folks don't know how to make their pets behave. And I don't need your cat tearing up my stuff or your dog tearing up my stuff. You can do that when you buy a house. That'll be fine then. But this is my house. And so we just have some rules like that, and we check it, check the people,

check the property, and verify that everything's going right. I haven't had one torn up, but the way you get one torn up is you ignore it or you put the wrong people in or both. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM,

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in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thank you for joining us, America. Nico is with us in Los Angeles.

Hey, Nico, how are you? I'm doing well, sir. How are you? Better than I deserve. What's up? So I've got a question for you. I am actually in a pretty good financial position right now. I actually read your book recently, and I've had a friend push it on me for a long time. And I look into traveling because it's something I love to do, and at my current state, I don't have any debts.

I will admit I blew a lot of money when I was younger. I'm only 26. I blew a lot of money on cars and stuff, and at one point I got it together. I was just like, what am I doing? It's not bringing me any happiness. It didn't do anything for me. So at the current time, I have no debts. My monthly expenditures are really low. I

live with a friend. I rent a room. And I've got an old 401k with my previous employer, which is going at a pretty good rate. So I decided to leave it there at least until it's ready to roll over to an IRA. And I've got savings. How much savings do you have? I'm sorry? How much savings do you have? I'm sorry? How much savings? I've got about, in total, about over $20,000, but I've got about $3,500, $4,000 of it in investments. Okay, cool.

What do you make a year? I do, last year I did just over $58,000 before taxes. Good, good for you. So like I said, over 58 before taxes. Good. Good for you. So like I said, I got it together. I started realizing that spending money on frivolous things just wasn't making me happy, and that travel was something I did. But next year I'm really suited for wanting to go back to school full-time and working on the weekends a little, hence why I've been saving money.

But also I'd like to go to Europe for one to three months at some point before I really get my head into school. And again, I don't want to have to take loans. And if I stick to a state school, like I've heard you say before, you can save a lot of money and whatnot. But I would like to do a big trip that would essentially, something that's been a life goal of mine. And obviously do it cheap.

I don't plan to live lavishly. But do you think there's a percentage of money I should be looking to spend on something like that or pulling from my monthly savings as far as what I'm putting away? Is there anything in mind you'd have for me? Well, I think what you want to do is you want to make sure that you have your goals lined up and funded. And so we have several goals on this list. We want to be able to survive while we go through school. We want to be able to pay for school.

And why would we do that? Because that's all good for your future. And we're not going to run up a bunch of debt doing that, if I'm you anyway. And then you run out of budget on that. And you run out of budget on, and you run out of budget on i mean a price list basically what's it cost to do those things and then run the same thing out on your europe trip and then put those numbers together and go okay that's my goal i need to work like a maniac to have enough to go through school and not go into debt and make my Europe trip before I start my school process.

And if you've got it all funded because you set it as a goal and you leaned into it, then that's the grown-up way to get at this. But if you're going to go over and run up a bunch of credit cards and say, well, I deserve this, well, you don't deserve hell. And that's what you're setting yourself up for. Yeah, that was my exact thing. I even stopped with the, you know, like I said, I've never gotten into any major credit card debt. I paid it off every, you know, every period. But like you said also, like you do spend, I've noticed that my expenditures were a lot higher when I was using that credit card because it was almost like a detachment.

Yeah, and so, I mean, my wife and I just came back from three weeks in Europe, so it's a blast. Go do it. I highly recommend it, but pay for it. And the only way you're going to be able to pay for it is have a plan. The only way you're going to be able to pay for school is have a plan. And so, you know, talk to the school that you're thinking about going to and, you know, find out what it costs to go there and find out what it costs to live.

You know what it costs to live in the area. You know how to live on the cheap. You you got the roommate thing going and all that and so you're doing los angeles as cheap as it can be done right now and um young single guy and the good news is you know when i'm in when i was in situations like you're in i didn't mind playing really really hard but when i worked i worked really really hard and so it might be that you say okay it's going to take me 18 months to lay the foundation to do these two things. Game on. No life for 18 months.

I'm going to pile up money for Europe and for school. And then you turn the corner. You have the blast in Europe. You dive into the school, and all of it's paid for because you had a detailed plan of what it was going to cost, and you worked and funded that plan. If you do it that way, I'm with you. I'd have at it. I don't see anything wrong with the process you're using, because you've got plenty of time when you set in after school to start long-term things like wealth building and

retirement planning and that kind of stuff, and you're not saying, I'm never going to do that as a philosophy of life. You're saying, hey, we're making a turn through Europe straight into school. We're going to come busting out of school and start hitting some of the next set of goals. And if you're doing that, then I think you're doing the right kind of thing. John is with us in Orlando. Hey, John, how are you?

I'm well. How are you? Better than I deserve. What's up? It's awesome. I have a question. My wife and I have about $45,000 in unsecured debt, which is credit cards and a second mortgage that we should have never got on the home. What we're looking at doing, our original was a VA loan.

We're looking at doing a VA refi on our home, and it's at a lower interest rate, but we want to put all that debt onto that, the $45,000. Everybody's willing to do that for me, but there's something telling me that that's not a good thing to do, and I'm just trying to get some good advice on that. I'm going from a 30-year loan that we owe $17,000 on to a 15-year loan. I don't know if that's a good idea or a poor idea. Okay. And so what is the loan balance on your first mortgage? About $103,000. And what is your interest rate on that? $5.5,000. Okay. And what is the loan balance on the second mortgage? Almost about $17,000. Okay. And what is the credit card balance then?

You said $45,000, so about $30,000, about $28,000? Yeah, roughly $30,000. Okay. All right. And what's your household income? About $115,000, $120,000. And what's the house worth? They're saying it's worth about $205,000, $210,000.

Okay. All right. Typically, what I would tell you to do is, yes, I would refinance that first mortgage. I probably would go ahead and roll the second into it. Not necessary, though, with that income. The big thing you've got is you guys are just very disorganized and sloppy. You make a lot of money, and you have no idea where it's going. No idea.

And you can't refinance your way out. My wife has a lot of money, and they don't, you know, she doesn't really pay attention. I'm sorry, say that again? My wife's family, she comes from quite a bit of money, and she just has never really paid attention, I guess, and that's not all her fault. It's as much mine as it is hers. Yeah, I think the two of you need to sit down and talk about everybody at your place growing up

and saying, we make $200,000 a year and we're freaking broke. Yeah. It's nuts. Yeah. I mean, you mean you have this conversation because not no amount of refinance is going to fix that no and the problem is this 80 of the time that people refinance and pay off credit card debts they have not changed the habits that cause the credit card debts and the credit card debts grow back. Absolutely. And this would be the third time, if I ever paid it all off, that I would have been debt-free in our marriage.

I rest my case. So, yeah, I'm trying to figure out a way to get her on board. Like I said, it's not all her. It's me as well yeah i think the two of i think this is a wonderful relational emotional and spiritual opportunity for growth for you guys as a couple this is not really a math problem this is a relational a behavior an attitude a spiritual an emotional problem that um and really you owe it to the two of you, both of you, to deal with this issue. You don't have to become some kind of weird-out, whacked-out people

because you don't owe much money. You just make a lot of money and waste it all. Absolutely. And it's just time to fix that. How old are you guys? I'm 40, and she'll be 37. Okay. So in your case, I would strongly recommend you do not refinance the second and the credit cards into the loan

because I think they're going to grow back again. If you want to refinance the first, whoopee, yeah, go ahead and do it. Wouldn't do it on a VA. VA is too expensive. I'd do a conventional. But if you had six months of proven track record, the two of you were working together, you were managing money well, we might roll the second into it and then pay off the credit cards on a debt snowball. But I don't trust you guys to do

that right now. And you shouldn't trust you to do it right now. This is the Dave Ramsey Show. Hey guys, it's Blake Thompson, Chief Production Officer for The Dave Ramsey Show. This hour's up, but you'll find more on our YouTube channel, where we have over 6 million YouTube views each month. You can find debt-free screens, millionaire hour clips, Dave rants, and so much more. Go check it out. Can you believe this real estate market? Home shopping has become so competitive.

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