The Ramsey Show - App - Stop Worshipping at the Altar of the Great FICO! (Hour 3)

Episode Date: December 7, 2021

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show. Where debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. George Campbell Ramsey personality is my co-host today as we answer your questions about your life and your money. 888-825-5225 is the number. Sherry is in Kansas City.

Hi, Sherry. Welcome to the Ramsey Show. Hi there. Thanks for taking my call. Sure. What's up? I have a 22-year-old son who is in an apprentice program, getting paid, so no college debt, and he's going to be finishing that program in about a year. Looking ahead, and he's working, or he would be the one calling you. Looking ahead, he's wanting to know what you suggest in how he builds credit, because right now he has none because he hasn't purchased anything.

He's purchased something. He just didn't use debt. That's correct. He's always paid cash. And he asked you to ask us? Did he come to you wondering about this? He did because he's grown up with Dave Ramsey and knowing the knowledge behind it because his parents lived by it. Well, what are your thoughts on how to build credit or if it's wise to?

Well, I don't know. That's why I called you because we didn't start using Dave Ramsey until we were almost 30 years old and going by his plan. So by that time, we'd already established credit through purchasing a house and a credit card. I'm confused which Dave Ramsey you've been following. Because this Dave Ramsey never told you to build your FICO score or build credit. We told you to get out of debt and stay out of debt. Does that sound familiar? Yes, correct.

I'm saying that we were at that point, and then we met you. I know, but you said your son grew up with Dave Ramsey, and his first question is how to build credit. So he must have missed something. Well, other than knowing to just save, and that's what he's doing. But we don't know. I mean, he'll be saving for a long time. And so we're just to know your recommendations. So the way I was raised at 22, I thought the same thing. And I

was like, I got to build my score. That's how you live your financial life. And what we found is that the best way to build the financial future for your son is without a credit score at all. And that's very countercultural. That's very against the grain. But he's already done it by paying cash for school. And so the question is, does he need a credit score if he's not going to take out any more debt? And that's the only reason why people really build their credit score is so that they can have a high score so that they can take on more debt. And so if he's already on board with the Ramsey plan of living his life without debt, then he can do all of the things that everyone else can do, and he

can do it without a credit score. And that includes he's going to pay cash for a car. Therefore, he doesn't need a credit score because he doesn't need a car loan. He can do manual underwriting when it comes time for him to buy a house, which means they're not going to look at his credit score. They're going to look at his overall financial picture. And you can get a mortgage without a credit score. And so really there's no issues here. Everything else you're paying cash for, and so you don't need a credit score. The purpose of the credit score is to get you in debt so that you can get more in debt, so that you can get more in debt, and you need to build up your score.

Precisely out of the 10,000 millionaires that we surveyed and asked them how they became a millionaire, the number that said that they became millionaires because of their great credit or great credit score was precisely zero. And so building the credit score is not a goal that we would teach you. We would teach you to avoid debt, pay cash for things, and, um you know if you're going to get a mortgage it's the only time we don't yell at you for debt uh because it because all the other debt is prohibiting you from winning and really the mortgage is too but at least you can get it paid off at least it's going up in value and so um you know that's the one thing but other than that so the answer is i would not build my credit score. I would not worship at the altar of the great Fico. It turns out he is not a very good provider as a God. That's for sure. Yeah. And Sherry, I've got a resource for you. If you go look up the

Fine Print Podcast, you can go to fineprintpodcast.com. Let your son listen to the episode that we did titled The Dirty Truth Behind Your Credit Score. We dig into this. It's short. It's enjoyable. He'll have a great time, and it will unpack why we say you don't need a credit score, and we'll show him how to do all of those things. And it's by George, and so it's a lot nicer than me. And so you're going to like it.

He'll enjoy it. Thank you for admitting that I'm nicer than you. Well, it's not a hard admission. America has been waiting for this. that I'm nicer than you. Well, it's not a hard admission. America has been waiting for this. Most people are nicer than me. I'm actually really nice because I'm really telling you what you need to go win because I love you. But I just. It hurts to hear.

I put a little sugar on it. Well, I don't really put much icing on it. So it's just the cake. Okay. So. But. And I'm kind of in a hurry because there's a lot of people that need this help so that that's it just makes me get to the point and 30 years of doing this it's just you

know okay there you go that's what you need to do and so there it is and yeah yeah but so yeah go listen to the fine print by the way all the episodes of fine print was robin hood but the last one of the last one of the last season of the first season and now we're going to another season and we've got you know we're thinking maybe a timeshare episode. Oh, yeah. Reverse mortgages could be a fun one. Reverse mortgage episode. Oh, scams.

We've got to do scams. Oh, scams. There's so many out there. I mean, for real scams. We talk about a lot of things that are the same as a scam, but like real people that get scammed and real scam artists out there. That's a really good episode. That'll be good.

We chose a podcast where there's endless amounts of content, so that's good. There's always ways people are getting screwed when it comes to money. That's true. That's true. So The Fine Print, one of the Ramsey Network, well, the Ramsey Network's newest podcast, and very popular, by the way. It's done really well, George. I appreciate that. Well, thanks for all of you who listen out there. Jason is in Lansing, Michigan. Hi, Jason. How are you? Hey, Dave. Jason is in Lansing, Michigan. Hi, Jason. How are you? Hey, Dave.

How are you? Better than I deserve. What's up? Same here. Hey, my question is about some student loans that my wife has. Basically, she's got about 23,000 student loans to pay off, and then the 0% interest rate ends, and the payments need to begin at the beginning or at the end of January.

She's been working her tail off while doing her master's classes, and she's got enough to pay it off right now. Good, do it. And I guess my question is, should she pay it all off now and end up paying no interest and all that? Yes. Or wait until maybe good old Joe implements one of those forgiveness plans that I've been hearing so much about? You're going to be dead before that happens. Okay.

Yeah. I mean, he may get around to it, but if you wait on Washington to be your blessing, your life's going to suck. I believe that. I don't support the government bailouts by any means, but, you know, I'm not an idiot either. Unless it comes to you, right? I'm going to pay this off, and then February comes by, and they say, oh, here's $10,000 off say oh here's ten thousand dollars off of your loans that's not gonna happen well it's not coming it's not coming in february okay it you know there's a saying that old people used to say older than me even like if something's really difficult they go well it takes an act of

congress meaning it's going to take forever well Well, guess what? In order to forgive student loans, it takes literally an act of Congress, which means it takes forever. That island of misfit toys can't get anything done up there. Even if it was the right thing to do, they can't get it done. And this ain't the right thing to do. Take control. Yeah, dude. You got the money.

Write the check. Be done with it. Move on with your life. Say, thank you. I got an education. Thank you. I'm debt free. Now let's get on with making some money, being outrageously generous, and helping other people with it.

That's the plan. Don't wait on Washington to bless your life. Your life will suck. This is the Ramsey Show. I saw some recent financial statistics and there was some pretty troubling news. When families were asked how long it would be before they faced financial hardship if a spouse died, nearly one-third said they'd be in trouble immediately. Another 44% said they'd be financially drained within six months. People, it does not have to be this way.

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you might think no one needs a real estate agent to buy a house these days that's very wrong in fact 90 of buyers who bought a home last year used a real estate professional why would they do that well if you've got an experienced agent a dedicated agent it's their number one job to help you win hey it's a wild world out there it is a crazy market this is not amateur hour this market's wild house prices go up you get in bidding wars a top agent is an expert negotiator who knows what it takes to make a winning offer. Plus, the seller almost always covers the commission for the buyer's agent anyway, meaning you get all the benefits of an agent for free.

I mean, what's there to lose by using an expert? Nothing. So if you're going to list a house for sale, you don't list it right now by yourself. You get a pro in your corner. If you're going to buy a house right now, you get a pro in your corner. Check out our nationwide network of the best-performing real estate agents in your area. They're called endorsed local providers because we endorse them. They're local, and they provide you with help. They're ELPs.

These real estate agents are Ramsey-trusted. They're committed to putting your values first and they are at the top of their local market ramsey solutions.com slash agent to find a trusted ramsey trusted pro who can help you buy a home ramsey solutions.com slash agent brandon's with us in oklahoma city hey brandon welcome to the ramsey show hey dave thanks for having me sure what's up um so i'm a truck driver and i make about 45 000 a year gross i had 17 000 saved but i spent most of that money on getting my cdl and i had financed it originally come across your show and it was stay out of debt so i said you know what i'll go ahead and pay it off. So now I've got 8,000 saved and, um, driving a truck, I'm able to put back a

thousand a month currently. So I don't know how much a person needs as a safety fund or really how much I remember seeing something about 25% of your, of your, um, your monthly, maybe your take home being your mortgage. I'm still a little confused on that. How do I know when I'm able to buy a home and how much should I have saved, more or less? So if you're following the baby steps, baby step one is to have $1,000 saved. You have that. Baby step two is to pay off all of your consumer debt. You've got that all paid off? No debt? Yep, no debt. So baby step three is where we save our three to six months of expenses.

So what does one month of expenses for you look like right now? $850,000. $850,000. Okay, great. So I would set aside, maybe that looks like five or seven, eight grand for you for a fully funded emergency fund. And beyond that, the rest of that money can go to 3B, which is where we're going to save up for a down payment on a house. So what I would be doing if I were you is looking at homes in my area that I would want to buy. And the parameters are pretty easy. We have a great

mortgage calculator on our website that can help walk you through this. But what you're looking for is to have 10 or 20% down. I love 20% or more because it helps you avoid something called PMI, private mortgage insurance. And all it does is protect the bank in case you can't pay. So if you can get 20% down and then have the payment on that mortgage on a 15 year fixed rate mortgage be no more than a quarter of your take home pay, that's going to allow you to have the margin to continue on with the baby steps and pay off your house early. So there's a lot of numbers in there. But the key is to make sure that you've got that down payment saved. And I don't know what the houses are running for in your area.

Have you done any research on that? Yeah, so in my area, I found a little – I'm single, so for me, I can get away with a small home. I've seen them go for anywhere from $40,000 to $60,000 on a nice little one-bedroom, one-bath home. Nice. Okay, that's fantastic. Okay, so if you save $10,000 for an emergency fund, you leave that alone. That's fantastic. Okay. So if you save 10 grand for an emergency fund, you leave that alone. That's your rainy day fund. All right. And then beyond that, you start saving your down payment. And, um, you know, if you save up 15 or 20 grand and put that

down on a 60 or $70,000 house, you're going to be just fine. Okay. Now on a house or a mortgage that cheap, you're probably not going to be going to a traditional mortgage company you're probably just going to be talking to your credit union because basically you're taking out what for some people is a car loan okay the regular mortgage companies won't do a little mortgage like this a tiny one like this so most of the time anyway if they do they charge you too much so your local credit union your local bank is the easiest the best way the most efficient way to get a smallish loan like that which the beauty of that is then you can turn around and just pay it off just keep chunking money on it and you'll have paid off in no time and that'll be a very cool place to be a paid off house no

debt of any kind and an emergency fund wow. Wow. Very good. Good plan. Kenny is with us, rather. Kenny is in Savannah, Georgia. Hi, Kenny. How are you? Hello, Dave. Thank you for taking my call. Sure.

What's up? So I recently came across your show about last month, and it really motivated me to pay off my debt. I was young, dumb, and stupid in the military, and I accumulated a lot of credit card debt. And I also financed a car, which was another stupid decision I made. But I kind of follow your debt avalanche method about three weeks ago, and I paid off $5,000 of my credit card. So now I only have $16,000 left overall debt for myself.

My wife is different. She's a student right now. She's about to graduate with her degree. So I just want to know what's the best way to tackle that. Should I keep following the debt avalanche or just do the debt snowball? I already have an emergency fund in place already, the Baby Step 1. Gotcha. Okay. Well, at Ramsey we don already, the Baby Step One. Gotcha.

Okay. Well, at Ramsey, we don't teach the avalanche. We teach the debt snowball. Okay. Okay, and that's listing your debts smallest to largest, paying minimum payments on everything but the little one, and attack the little one. We also teach you that when you are married, we are one.

The preacher said, and now you are one. He didn't say, and now you are a joint venture. So how much debt does your wife have? So the only debt that she has is the school, which is $19,000. Okay, so $19,000. I encouraged her for her master's to do a federal work there. That way the school will pay for that as she works for the school. So that's what she'll be doing.

And what will she be making at the school? She will be a teacher, and it will be about $1,500 a month. Okay, and what do you make? I make $52,000. Good for you. A year. A year. All right.

So you've got about a $70,000 to an $80,000 household income, depending on how many hours you all work. And you've got $34,000 in debt between the two of you. Does that sound about right? Yes, sir. So what we're going to do here is, do you guys have any savings right now? Any money in the bank? Just myself. Just myself. I have about almost $4,000 at the bank? Just myself. I'm the, I, just myself.

I have about, almost $4,000 in the bank. Okay. So if you're following the baby steps. Well, you're married, so that's hers too.

Yes. Yes, sir. All right. And you guys have one joint bank account? No, we do not.

Ours is separate, but our savings, our previous savings were both of us to have together. Okay. Well, I'll tell you this.

If you guys want to feel the progress of this thing, you're going to have to get on the same page, get one bank account, get the goal, get the plan, and do this thing together. Okay. Because right now, it sounds like you're living two different lives financially. Okay. But what you're going to do is have that $1,000 for your starter emergency fund, and everything else is going to go towards the debt. And you're going to do the debt snowball, like Dave mentioned, list them all smallest to largest.

And then once you're out of consumer debt, you're done with that $34,000, we go back and we fully fund that emergency fund with three to six months of expenses. That's going to create this financial foundation for you guys to where you don't have money stress anymore. So, Kenny, what I'll do is I'll put you on hold. Kelly will pick up. We're going to send you a copy of the book, The Total Money Makeover, to show you exactly how to do this. Combine your finances. Focus exclusively on the debt.

Listing your debt's smallest balance to largest balance. That's the debt snowball. You pay minimum payments on everything but the little one. You attack the little one with a vengeance as fast as you can. No eating out, no going on vacation, no frills, beans and rice, rice and beans, scorched earth syndrome around the house there. No lifestyle. We're getting out of debt. How fast can we get out of debt making 70 to 80,000 owing 34? Probably going to take you about 18 months if you're really, really intense. And the more intense you are, by the way, the faster you'll get out because the deeper

you'll sacrifice. Hang on. Kelly will pick up. We're going to send you a copy of the Total Money Makeover. Thank you. George Campbell Ramsey personality is my co-host today. Kyle is with us. He is in Des Moines, Iowa. It says on my screen, you're debt-free, Kyle. Congratulations.

Thank you. Well done. How much have you paid off? I paid off $ paid off 63 359 dollars did you say 63 or 53 63 63 what 63 359 dollars okay 359 dollars good and how long did it take you to pay this off just a little under four four months. Good for you. Wow. And your range of income during that time? So kind of crazy. I actually went from unemployed to finishing this year grossing $150,000. Cool. What do you do for a living? I am a full-time photographer and videographer.

So I do a lot of weddings and family photos, sports, commercial work, you name it. I kind of do it all. So you just started your own business and it took off? Correct. Yep. So you just started your own business and it took off. Correct. Yep. So I lost my job. So a little back story. So I actually went through a divorce 16 months ago.

And then not even a month later on my birthday, I actually got laid off due to COVID. Oh, my gosh. So I had a camera and I kind of just started hustling. Started shooting weddings, photos, like I said, um, family photos, anything to just keep a roof over my head. And with my finances, it got a little scary. Um, I had literally like less than a thousand dollars to my name and I just started this business. Um, and really COVID allowed me to run with this opportunity that I had. Wow. Wow. Good for you, man. I mean, you, you really, COVID allowed me to run with this opportunity that I had.

Wow. Wow. Good for you, man. I mean, you really got after it. That's impressive. What kind of debt was the $63,000? So $58,000 was student loans, and then $5,300 was my car loan. Okay.

So that was your part of the divorce. You walked out with those things. Well, yeah. The student loans was mine, and then my car as well I owned on my own okay all right and so you got to knock it out so what made you decide in the middle of all these crises hitting you at one time that you're going to get out of debt when my back was against the wall it really it was an eye-opening moment for me that i really had no big picture with my finances I had never really added up all my debt. So when I did that, it was really a shock to me. I didn't realize that I had over $63,000 in debt.

So I started getting very intentional with my finances. And since I was self-employed, I had to refinance to keep the home that I was living in after the divorce. So I had to get a full-time job in the meantime. So that allowed me to pay off my debt extremely fast because I was living in after the divorce. So I had to get a full-time job in the meantime. So that allowed me to pay off my debt extremely fast because I was working a full-time job, living off that income. And then every wedding, every photo shoot was getting thrown at my debt.

Oh, wow. Okay, so even after you got laid off, you went back and got a full-time? Correct, yep, because I needed to refinance my house after the divorce. Okay, wow. That's incredible the divorce. Okay. Wow. That's incredible, man. You're resilient.

Thank you. Yeah, I stayed really optimistic through the whole thing. And, you know, once I started my desk job eight months ago, I listened to you guys every day and listened to other people's debt-free screams and it really kept me motivated, knowing that that was just going to be a short stint in my life that I had to buckle down at that time and pay off my debt. And I kind of set a goal to pay it off in six months,

because my birthday was the date that the student loans were supposed to start back up with the interest. Happy birthday. Right, it was an amazing six months. A present for Sally Mae. Yep, so by my birthday, I had all my debt paid off and $20,000 emergency fund fully in place. Wow. Yeah, you went rice and beans, gazelle and tents. How did you tactically pay that much in that short amount of time?

$63K in four months is incredible. Did you just have great cash flow? Yes, great cash flow. And I knew how many weddings I had coming up. And that's what really made me look at it. Six months before my birthday and six months before the student loans were going to start back up. I knew I could do it just doing the math with how many weddings I had lined up and photo shoots and et cetera. While I was working my full-time desk job as well, just living off that income.

Yeah, you just made a chunk in a short period of time. Yep. And I knew it was a short stint, and now it's quickly flipping in the other direction. You know, as quickly as I paid it off, now I'm starting to invest with a Smart Investor Pro and got a fully funded emergency fund, and it's just quickly going in the other direction as well. Amen, way to go.

You're going to be a Baby Steps millionaire in 20 minutes the way you're going. Well done. How old are you? Thank you. I am 27. Oh, my gosh. Well done,s millionaire in 20 minutes the way you're going. Well done. How old are you? Thank you. I am 27. Oh, my gosh. Well done, Kyle.

Fantastic. Great, great job, man. Great job. So proud of you. Thank you. So what do you tell people the key to getting out of debt is? So I was a nerd through the whole thing. So I know budget is a big one for most, and it definitely is for me, too.

But I would say find something that you love to do and that you're passionate about and find a way to monetize it because i think if you're really passionate about something it will show in your work and you'll make money doing what you love and it won't feel like work there you go where's christine ken when you need them yeah incredible man absolutely beautifully said yeah that's that was a ken coleman home run right there i like it thank you so well done sir. So well done, sir. Very, very well done. Who were your biggest cheerleaders? My family was very supportive, and now I am with a girlfriend,

and she has been amazing and so supportive through this whole journey for me too. So it's helped a lot. They're definitely very important to me. I mean, you had to have some people in your corner. You lost a marriage and you lost your job. Yep. And then you hit covid head on and and and you got 63 000 piled up in the corner over here getting ready to come down on your head on your birthday you know and so yeah you had to

have some people in your corner pushing you and saying you can do this definitely my family's super supportive we're super close um and i knew that this listening to you guys and thinking more long-term, obviously it was bad at the time, but I was thinking more long-term, like I do want to change my family tree. I'm thinking more into the future long-term and definitely had a support system with my family. Yeah, well, you're definitely going to get there. You're definitely going to get there.

So very well done, you guys. Man, I'm so proud of you. We've got a copy of the Total Money Makeover for you to give away and encourage someone else, and an advanced copy of the new book, Baby Steps Millionaires of Mine, which comes out in January. But we're going to send you a copy

early to celebrate the fact that you are debt-free and on your way to being a Baby Steps Millionaire. That's the next step for you. So well done, Kyle. Proud of you, man. You're a hero. Thank you so much.

Good job. Good job. All right, Kyle in Des Moines, Iowa. $63,000 paid off in four months, making $0 to $150,000. That's a story. Count it down. Let's hear a debt-free scream. Three, two, one.

I'm debt-free scream three two one i'm debt-free man oh man oh man nothing's gonna stop that guy you know i was just thinking that's very interesting because a lot of people uh he turned every one of those uh lemons and lemonade i mean in every case he flipped it in his language and you could tell it flipped in his head and he flipped his language to where he's saying okay i went through this horrible thing but that means i get to do this and this happened but that means i get to do this instead of like well i lost my job and eeyore is my spirit animal and, oh, it's bad. It's going to be bad.

Oh, and then COVID hit and I just can't get ahead. I sure hope Biden will send me more money. You know, he wasn't sitting around saying that. No, there was no wallowing. It was just like, all right, I got punched in the face. I'm going to get back up and I'm going to make something out of this. And he did. I mean, he lined up serious

numbers of jobs right there in a very short period of time made enough money to clear the whole thing in four months that's i mean he stacked and double stacked yeah but uh but you know all of it was just oh okay well while i'm while my heart is broken and i'm going through this horrible thing called a divorce and while this is happening and while that's happening i'm just gonna take all these lemons and make lemonade and just get out and and his whole life is set up but that's a all of that was just a decision it was a way of viewing this through a positive opportunistic lens rather than viewing it through i've been slapped and i can't do anything lens i mean yeah and I guess, you know, sometimes people do that kind of in their nature,

but sometimes that's just a decision. I'm just really going to choose abundance rather than scarcity. He had a lot of excuses to just let these loans sit, wait for forgiveness. Most people listening, they weren't going through stuff like that, and they can make the choice today. Just go, you know what, I'm going to be a Kyle. Nothing's going to stop me. This this debt's gonna be out of my life

absolutely very cool very well done good job kyle great work brother this is the dave ramsey show We'll see you next time. John 1335, by this everyone will know that you are my disciples if you love one another. Charles Schwab said, the way to develop the best that is in a person is by appreciation and encouragement. That's true. And that's good. Open phones this hour. George Camel Ramsey personality is my co-host. And Daniel is in Maui, Hawaii.

Hi, Daniel. How are you? Hey, how's it going? Better than I deserve, sir. What's up? Hey, so I'm in escrow right now. I'm trying to buy this condo. And the guy wants $50,000 over the appraised value.

And the market right now, everything's really high. And buying property here in Maui, everybody's overpaying. So I was wondering, like, do you think that's a good idea? What's the price of the condo? The guy wants $550,000 for it. It got appraised for $500,000. How old is the appraisal? It just got appraised, like, a week ago.

Mm-hmm. Okay. Is this your first home purchase it is how old are you i'm 29 okay and how much down payment do you have went down 20 so you have a hundred and some odd thousand dollars to put down yeah where'd you get that oh just just working and then i do a little investing here and there find stocks and selling stocks okay and what do you make a year uh currently um anywhere from 200200 to $220. Okay.

What do you do for a living? I'm a journeyman lineman, build and repair power lines. Okay. Well, is there any other condos available that are not over market? Sounds like you stumbled onto one deal and you fixated on this one deal well because uh all the other condos around here in maui if it's next to a beach it's it's in somewhere around minimum like 650 you know so i found one more inland and uh so for 500 we offered 576 you know because his asking price was 550 and then the appraisal came back way lower. And just for a three-bedroom, two-bath here is so expensive.

And so I thought it was the best deal, you know, that I could find. But still, $50,000 over appraisal, you know. Hmm. So you're under contract on it, and the only question is whether you need to walk away based on the low appraisal i would put a clause in there saying we'd only pay 25 000 over the appraisal and uh but he's the guy's not budging he just wants to stick with 550. okay so time to run tell him to order another appraisal at his expense and get one for five and a quarter then yeah yeah you do that their closing date's coming up uh on the

27th so and right now i'm getting appraisers uh minute. I mean, if I'm in your shoes, I'm saying, hey, it's $525 or we're going to walk. Because right now it feels like he's trying to throw you guys around a little bit and make a little extra on the deal. But truthfully, if you guys waited a little longer, saved up a little more, you could get something for $550 or $600 that's by the beach. So I'm not taking this deal as is either way if i'm you yeah here's the thing you want to avoid daniel and you're not avoiding it so that's why i'm saying it you want to avoid this sense that you are uh that you've gotten locked into the tractor beam and

you're being pulled into this deal against your will, like, you know, and it's like it has to happen, and there's nothing else, and it's the only way it'll do it, and the guy won't budge, and we can't do it by the 27th, and, you know, it's all pulling you straight into the deal, and all the while you've got this sense that something's wrong, and that's what we're hearing when we're talking to you. The way you're using your words, the way you're structuring your sentences all of that is like i feel like i'm

like i'm trapped and i have to move forward in this thing and it's not what i want to do it doesn't feel right and every time i do that uh every time i talk myself into feeling like i'm trapped and i gotta do something that i know down in my gut is stupid, it kills me. And, you know, you don't feel good about this. I can tell by the way you're talking it through. But yet you feel trapped. And you're not trapped. It's just a stupid condo.

There's a whole bunch of them on Maui. I've been there. Lots of stupid condos on Maui maui now you may not get one for a while it may be three or four more months it may be something else but later on when you get the right deal that you don't have this weird feeling in your stomach about because that's why you're asking the question is because you don't feel good about it and uh i've got a friend daniel gave me a rule in business a long long time ago he said when in doubt don't pretty good rule simple i love it i wouldn't buy it daniel tell the old boy five and a quarter i

made a deal with you i will honor my word i will honor my contract and we will close on the 17th at 25 000 over appraisal sorry your condo didn't appraise. I was willing to pay more, but I was only willing to pay $25,000 over appraisal, and I'm still willing to do that. If you'd like to sell your condo, it is sold, Bubba. But if you don't want to sell it, I understand, and we'll keep looking. Your choice. I'll give you odds he's going to close. I'm with George.

No, I'm not taking the deal. Not at a dime over five and a quarter, unless another appraisal comes in and I'm with George. No, I'm not taking the deal. Not at a dime over five and a quarter, unless another appraisal comes in, and I'm contractually bound to take $25,000 over appraisal at that point. You made a nice offer on that. Open phones at 888-825-5225. Jesse is in San Antonio. Hey, Jesse, welcome to the Ramsey Show. Hi, Dave. Hey, Jesse, welcome to the Ramsey Show. Hi, Dave.

Hey, George. It's been a pleasure talking to you guys. Thank you for entertaining me, Paul. Sure. My question is, Dave, my question is, should both my walk-in and I fix the broken transmission from the camera drive? A little back story. I started your plan on june of this year and we lost them oh okay here's your rule of thumb you add you look at what the transmission costs

and or the repair on the car and you ask yourself okay if i sell it as is with a broken transmission because he's driving a hoopty and uh and And so the problem is the transmission may cost more than the hoopty. And so, you know, you don't put a $2,000 transmission in a $1,000 car. You don't put a $2,000 transmission in a $3,000 car because it doesn't increase its value. You could put a used transmission out of the junkyard in there, and you do that for a few hundred bucks or something. You can find some way to pull that off, that's fine. But if you're driving a $2,000 car that has a $1,000 repair, very seldom are you going to want to do that.

You just sell it as is. You take that money, any other money you can scrape together that you were going to spend on the transmission, and you buy a little bit better hoopty that doesn't need a transmission. And you keep moving. You keep rolling. No payments, no debt. Yeah, and that's part of baby step. And you keep moving. You keep rolling. No payments, no debt. Yeah.

And that's part of baby step two is you're sacrificing, you're driving the car you don't want to drive so that later you can drive the car that you want to drive. And you can upgrade over time. And then you can upgrade that car over time. But definitely don't go out saying, well, we need a $10,000 car now, Dave, because we need something reliable because the last one crapped out on us. So we're not going to buy another $3,000 car. That's what happens. You start to make stupid decisions people

over ramsay are unrealistic it's unrealistic to remain broke your whole life because you keep falling into the debt trap yeah you have to live like no one else so that later you can live and give like no one else george is right drive like no one else so later you can drive like no one else that's good advice thank you i got it from you i know a guy i know a guy well i mean the truth is it works and the problem is when you're in the middle of where he is right now it's a pain yeah it's it's just you just get frustrated and exhausted from dealing with the crap and you just if you're not careful you just give up and go buy a car on payments. Yeah.

But the most powerful stories, they're the ones who use that pain. They go, this situation sucks so badly that I'm willing to do it every day. I'm never going to be here again. That's a good point. That's a good point. Very well done. Good stuff. Good hour, George.

It's been fun. Well done, Ben and Kelly in the booth. I am Dave Ramsey, your host. We will be back with you. Before you know it, in the meantime, remember there is ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.