The Ramsey Show - App - The Math Behind Millionaire Status (Hour 1)

Episode Date: January 21, 2020

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Music Music Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, 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. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. Strangely here, we teach you common sense for your dollars and cents.

But common sense is so rare, now having it is like having a superpower. So we're glad you're with us. We teach you to live on less than you make wow the concept congress can't grasp and no one on instagram we teach you to live on a plan instead of a whim instead of thank, thank God it's Friday, oh God it's Monday, why don't you plan to retire with dignity? Why don't you plan to change your family tree? It's not going to happen unless you do. We teach you to get out of debt because if you don't have any payments,

you know what you've got? Money. When you've got money, it, you know what you've got? Money. When you've got money, it gives you the ability to build wealth and change your family tree and retire with dignity and be outrageously generous, and we teach you to be outrageously generous. You see, I've got this weird idea that if I can get enough of you out of debt and increase your generosity factor, you and I could give so much money to so many things that need it, we could make the government irrelevant. They kind of are anyway, but we would force them to admit it.

It's a different way of thinking, and that's what we're here for. We want to change the way you think. Jennifer is going to start off this hour. She's in New Hampshire. Hi, Jennifer. Welcome to the Dave Ramsey Show. Hello, sir. Thank you for speaking with me today. Sure. What's up?

So a few months ago, I had to kick out my husband. He's an alcoholic who was abusive to my children while I was at work. So I don't know if, I mean, we're in the process of getting a divorce. And I just, I don't know after all is said and done if I'll still be able to afford my home. Mm-hmm. Mm-hmm. Okay. So what do you make a year? It's your job.

I make $110,000, and then I just started a per diem job. I mean, I have to pay for babysitters, but I'll be able to pick up unlimited hours pretty much. Okay. And so your take-home pay on the $110,000 amounts to what? It's $6,000 a month. Excellent job. And how much is your house payment? It's $3,000 a month. Okay.

All right. Well, I mean, I think the important thing is the kids are okay. The important thing is you're okay. House is just a stupid house. There's one on every corner. Home is where you make it. And so trying to hold on to a particular physical location to make everyone all right and that causes you to go broke is not going to be good for you guys long term.

And so you have a house payment that's 50% of your take-home pay. You hearing me? Yep. Yeah. So as painful as it is while you're in the middle of all this other pain, I don't want to give you bad news, but, you know, bad news is that you try to hold on to this thing because you want to keep the environment stable for the kids in an unstable situation. And I appreciate Mama Bear wanting to do that.

But the truth is, is it's going to starve you to death. So in the short term, everybody feels a little better. In the long term, everybody feels a lot worse. Yeah. And so if I'm you, unless something changes dramatically in your income, you know, I probably would sell this house. Now, what is the house worth? Probably $750,000. And what do you owe on it?

A little over $500,000. And what do you owe on it? A little over $500,000. Okay. So you got some equity for a down payment on another property to start again. Worse things have happened to people. Okay. True. You've already made much harder decisions. In the last few weeks, you've made harder decisions than the decision to sell a house.

Much harder. Agreed? Yes. Yes. It's just that you've got pain upon pain upon pain, and this idea of yet one more piece of instability just scares the crap out of you, which just makes you a good mom and a good lady. But your problem is your math doesn't work. You see what I'm telling you? Yeah, I've been trying to figure it out.

Yeah. I wish I could wave a wand to make this go away for you, but my wand's low on batteries. And so, yeah, I wish I could figure it out. I wish there was a way to figure it out but there's not really an equation where your house payments half of your take-home pay that ends up being anything but a nightmare and you don't need another nightmare you're just getting rid of one true very true so i'm so sorry i'm so sorry i said what i said what you already knew didn't i yes Yes. Yeah.

I'm sorry. Listen, you're going to be okay. We're going to put you in Financial Peace University and help you handle money as you go through this confusing and torn up time in your life. And you're going to be okay. Five years from now, you'll be in a comfortable home. You've got a great career. Your household will be stabilized. Your kids will be safe. You'll be safe. And you've got a great career. Your household will be stabilized. Your kids will be safe.

You'll be safe. And you've done the right thing. You can't allow people, no matter who they are, to have access to children who are going to bring harm to children. It's just not an option. So you've done the right thing. You've made some really hard decisions. You're very brave. You're very courageous. But you made the right one so far. So keep making the right call. We'll walk with you, kiddo. You call me anytime. Kelly will pick up right now. We'll get you signed up for Financial Peace University, and we'll walk with you through that part of it. I can't fix everything, but I can fix that part and help you with it. So thanks for the call. Let me just tell you, if you're going through a divorce and nobody wants that and I would never recommend divorce, I certainly would recommend keeping someone away from a lady

or her children who was being abusive. Got no use for that at all. But if somebody's going to go through that, most of the time, statistically speaking, you bought your house based on income that is not going to be in the house anymore. And so affording the house after the divorce is an unusual thing. It usually doesn't happen. You usually need to sell the house. But it's normal because we don't want the kids to change school systems. Their friends are all there. They've already got all this upheaval in their lives.

And we want to protect them from any more upheaval, any more volatility, any more emotional pain. But you can't. You can't. They're going along for this ride because you're gonna you're gonna trade one kind of emotional pain for another one because later on they're gonna be broke you're gonna be broke you can't afford clothing you can't afford their college debt you can't afford their college tuition you can't afford to live because your house poor that's a normal transaction in most case studies that we see.

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He says, Dave, how much money do I need to make a year to be considered a millionaire? Ryan, a millionaire is not a level of income. There's two measures of money or wealth. One is income. One is called net worth. Millionaire is based on your net worth. Your net worth is what you own minus what you owe equals your net worth, your assets minus your liabilities.

And so if you don't have any debt, No equals your net worth, your assets minus your liabilities. And so if you don't have any debt, your net worth is simply the value of the things you own. And so if you save for retirement in a mutual fund and you build up several hundred thousand dollars there, you've got a paid for home that's worth several hundred thousand dollars, you add those together and it's equal to more than one million dollars with no debt, then you would be a millionaire. So how do you get $1 million? That's what it amounts to. That's what a millionaire is.

Well, one way is to invest. If you invest from age 25 to age 65 at only $100 a month, if you were to average about what the stock market's averaged, about 12%, you'd have $1,176,000 at retirement. Most people work making money from 25 to 65, and most people make enough during those years to save $100 a month if they didn't spend everything they make. So that would make you then a millionaire if you had a million dollars in your mutual funds in your retirement account, not to mention the other items that you've done along the

way. So it really doesn't take a lot of income to become a millionaire if you start early and if you're steady. That's what it amounts to. Now, you can actually have a negative net worth and a lot of people do a negative net worth is when you owe more than you own for instance you owned a home that went down in value for whatever reason the neighborhood was bad or something happened in the town or the area that caused the property values to go down and And the only thing you own is a house that you owe $400,000 on, but now it's worth $300,000.

So you owe $100,000 more than you own. You'd have a negative net worth of $100,000 at that point. So net worth is one measure of wealth, and it's the most lasting one because your income comes and goes depending on your job, your career, your business that you own, whatever it is that's creating the income. Net worth is much more stable, much more substantial. So you want to have a high income, but it is more important to have a high net worth, and that'll get you to where you want to be because, again, if you've got that size of a pile of money, the income that that pile of money creates starts to be enough to support you without you working, and that's what some people call financially independent. I don't usually use that term,

but when you have enough of a pile of money in your net worth that it creates more money than you make, then I actually call that the pinnacle point. When you go over the top of the hill and that's where you have enough money that your money now makes you more money than you make you. Now that's a substantial net worth and that's usually more than a million dollars depending on what your income is and what your career is and so forth. So that pile of money, as you build wealth, gives you stability, gives you income. You could have a bunch of rental property that's paid off.

You could have a big pile of money in mutual funds and your 401Ks and Roth IRAs and that kind of thing. It doesn't matter where the pile of money is or if it's some mix of those is what it usually is. That pile of money minus your debts, which hopefully you have none if you do what I teach, is your net worth, and when that is equal to $1 million, you're a millionaire. That's how much money you need to have to become a millionaire, but it is not how much money you make a year. There are people actually that make $1 million a year and spend it all, and they have no net worth.

It's hard to believe people would be that stupid but i meet them sometimes they're professional athletes sometimes they're people in the music business sometimes they're just people that hit the lotto but i meet people who make a million or more a year and spend every bit of it and have absolutely no net worth now we would all say that's wasteful and ridiculous and it's easy to assume that if we got there, we wouldn't do that. But what you've got to do is you have to set yourself to say, no matter what I make, I'm always investing. No matter what I make, I'm always giving. And that will create your net worth, cause your net worth to grow. And your net worth is the stability factor.

It's what real wealth is. When you talk about a wealthy company, a wealthy family, a wealthy whatever, no one's ever talking about their income. They're talking about what they actually own, which becomes your net worth. And that's where your millionaire status comes from. Very cool stuff. Good question, sir. We appreciate you joining us. All right, John is going to be with us in California. Hey, John, welcome to the Dave Ramsey Show. Hey, Dave, thanks for having me. I appreciate it.

I started listening to you back in 2012, wasn't ready for it, and my wife bought your kit over the Christmas break, and I am on every dollar, and I'm all in. Started the debt snowball to see how much in debt we are, and I'm excited to knock it down. Good. So with that said, trying to figure out if selling our car makes sense or not with our given situation.

Okay. How much do you owe on the car? $21,800. And what's it worth? Roughly between $13,500 and $16,000, depending on Kelly Boogook's estimation. Okay. And so what's your household income? It's between $215 and $245 a year.

How much other debt do you have not counting your home? We don't have a home. We rent in Los Angeles. So including the car, it's $137, but minus the car, if we didn't have that, you're talking still $1 know still 115 116 between credit cards and uh um two months yeah okay well the good news is uh you've got a big shovel a great income bad news is you're in pretty good size hole and the other bad news is it's not really a car hole the car is less than 15% of your problem.

So you move the needle 15%. Now, if you call me up with, you know, let's say you made $50,000 a year, not $215,000, okay, and let's say you only had $50,000 in debt. Now the car is 50% of your problem, and it's way too big a percentage of your situation. In your case, it's a small percentage of the problem and a small percentage of your income. Unless you just don't like the car and you want to sell it anyway, it's not the problem. Do you like it? Yeah, we like the car. I'll just keep it and work my way through it then.

Okay, we'll do that and just keep attacking the debt as we can. I mean, you know, and thank you so much for being who you are because it's helped me so much just to ground myself and understand how to track. So if anyone's not on every dollar, get on it now because it's helped me so much. I'm honored. How old are you, sir? 32. Okay. Well, the good news is you're discovering a thing that you believe in, and your hope about the future is 98% of the solution to this problem. The car is only about 2% of the solution.

So you getting game on, you getting focused, you getting willing to do what it takes to cause this stuff to happen, that's what's going to change your situation. Again, if the car was a big percentage of your world, I'd sell it in a heartbeat. It's just a stupid car. But it's not really going to move the needle that much. Now, you may get down to a point where you've paid off everything almost but this car, and you look over and you go, let's dump this thing because we'll finish it off. Might do it then, but right now I think we're going to let you be who you are, and that's you are the secret sauce to this situation.

Hey, if you're listening to me right now, and you grew up watching your family struggle with money, your family's history was struggling. You know, we get callers who tell us all the time money was a source of stress in their family. Well, that's most families, right? Bad money habits, though, are not in a DNA issue. Well, my family always know. Your family just decided to be that.

You can just decide to not be like your family. If your family always was drinking, you don't have to drink. If your family was always running around, you don't have to run around. You can just decide not to be like them. You can still love them where they are, but you don't have to be like them you can still love them where they are but you don't have to be like business to the next level this new year. You can start by hiring the right people to help your business grow. At Ramsey Solutions, we post on LinkedIn Jobs because they are the best at matching the right person with the right job.

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That's linkedin.com slash Ramsey. Terms and conditions apply. Megan is with us in Ohio. Hi, Megan. Welcome to the Dave Ramsey Show. Hi, Dave. Thanks so much for having me. So my husband and I are debt-free, and a fully created 6,000 RZC fund. We just put in a cash offer that was accepted on what would be our first home. And it's a HUD foreclosure, if we go through with this, is like all the money that we have aside from our emergency fund.

And it's in a great location. We really love it. It's close to my family, close to my husband's job. But there's quite a bit of work that needs to be done on it. Mostly cosmetic, as far as we know right now, there might be some bigger things, like there's baseball sheets, which we don't like. No AC on an in-ground pool or that, because we have a little daughter, which we're not crazy about. So things like that, that we really have to take our time to pay up the cash to fix in the future. But we do see ourselves probably being there for a number of years.

So, and two, what's really appealing about it is a lot of the homes in the area are worth $100,000 more than what we'd be paying for this house. So it's been a really, really great location. We just don't know what to do. And you talked at the beginning of the show about... If you don't know what to do, why did you buy it? Why did you put an offer on it? Well, the location is really great.

It's right now? I mean, but you already made all your decisions. You bought the house. Yeah. I guess we can fill back out, you know, kind of the inspection. Yeah, I know. But why did you go this far if you were this unsure i guess we weren't in the beginning we've been looking at so many houses and well i mean i'm worried about the in-ground pool i'm worried about the baseboard heat i'm

worried about the work that has to be done it's all of our money where were all these decisions those were all things that were obvious before you bought the house. Yeah, yeah, they were. They were. You're absolutely right. Yeah, and that's my hesitation, I think, and that's why I'm a little scared. So I guess our decision was... So was this something like your husband decided to do and you were like half going along with? No, no, no, no.

We were both in it, and I think we both had a bit of housekeeping. We were in the beginning of it for sure. Okay, so what would you be paying for the house? $148,000. $148,000. And you think homes in the area are worth $250,000? Mm-hmm, or more. Yeah, there's a lot of new things. And what will it take to repair this house?

I would say at least $10,000. I would say more. 10,000. I would say more. I think so, yeah. You've got to put heating and air in a house. Mm-hmm, mm-hmm. Heat and air system alone is probably going to, you know, touch up. I mean, you've got duct work and everything because you have baseboard heat, right? Yeah, it's not easy to...

And you've got cosmetic. Is the roof good? I think so, yeah. Mm-hmm. Yeah, we haven't easy to... And you've got cosmetic. Is the roof good? I think so, yeah. Yeah, we haven't had the home in five years. And you're paying cash for the house. Yeah, we would. What's your household income? $65,000. $65,000.

And where did you get $148,000? We just saved like crazy over the past couple years um and just following your steps what's your husband do for a living he's a technical product manager um who's gonna do these repairs well my father is a contractor um and a carpenter. So he would help. We do some ourselves, hire people as well. What are you living in now? An apartment. It's a month-to-month apartment.

So you're going to stay there a little while while you get some of these repairs done? It's livable right now, so we could move into it as far as we know. Much harder to do repairs around you. Yes, yeah, for sure. Yeah. Yeah, and it wouldn't be a joke to be paying rent on this apartment while we own a house and are working on that. How old are you two?

32. I'm 32. He's 34. I can't tell whether you've gotten cold feet or whether you don't know how to make decisions. I can't tell what's going on. I really can't tell. Because you bought a house.

You bought a house. You made the decision to spend the money that you have, the precious money that you've saved up, down to the last dollar, which means you have to cash flow out of your budget the money for the repairs, and now you're freaking out. And I can't tell what's causing that. You really should be, like, embracing the adventure and excited, or you should have not entered into this deal in the first place, one of the two.

But this kind of half-in, half-out thing, I can't figure out. and excited or you should have not entered into this deal in the first place one of the two but this kind of half in half out thing i can't figure out so i don't really know what to tell you uh i would tell you that repairs cost more than you think they're going to they take longer than you think they're going to and doing repairs while you live in a home is known as hell doing a remodel while you live there causes sawdust to be in your soup. And it just takes the fun out of everything. Everything smells like dirt while you're living there. And drywall dust and paint fumes and the normal things that go with remodeling a house. I don't mind remodeling a house, but remodeling a house while you live in it is a complete pain in the butt.

So, you know, I think you guys need to sit back and decide, are we going to walk away from this and be happy about walking away from it? Or are we going to embrace this and be happy about embracing it? And I'm okay either way. I didn't hear anything here that scares me that bad, except that you're scared. That's what's weird. All right. Kenneth is with us.

Kenneth is in VA, in VA, of course, Virginia would be what that's what's weird all right kenneth is with us kenneth is nva nva of course virginia would be what that's called hi kenneth how are you mr ramsey i'm doing very well how are you better than i deserve what's up well first i wanted to say that i've i've followed you since i was 18 and i'm 26 now and it's really just given me a leg up on most other people who aren't doing it my whole life. And I just really appreciate it. My question for you is, do you have any advice or thoughts on investing into REITs?

Not the publicly traded kind, but private REITs, like rather than investing in stocks? They run the spectrum from really, really bad to awesome. And so I can't as a category say, oh, yeah, it's great, you know. But you would really want to do a lot of due diligence. A private one scares me more than a public one for a beginning investor. Okay.

Because whatever money you put in a private one, you need to be prepared to just forget you have that money. It's probably very illiquid. You're probably not going to be able to have access to the money for a long time in order to get the best returns. And you really need to be in with a group who is not milking the REIT for their profit through expenses, thereby leaving nothing on the table for the investors. And in the early days, even the publicly traded REITs did that to the point that for years we couldn't find a REIT that had an average annual return of over 8% in the public traded side. Nowadays, you can find them that beat the S&P that are north of 12%.

Now, not all of them do, but there are some good ones that are actually beating the S&P and would probably be a pretty decent investment for some people really interested in that. The private ones just leave you open to, you know, you just got a lot less transparency, a lot less insight, and a lot less liquidity. It's very difficult to get out of them once you're in them early. And so if you need to get out of a publicly traded REIT, it's just like selling a mutual fund. You just sell it and you're done, and there's a market for it.

Privately traded, private ones are, again, many times, not always, but many times very difficult to do. So I would want to do a lot of due diligence on a private one. I'd want to really know what was going on in the inner workings of it as best I could. I'd want the track record of the players, other deals that they have done where they didn't milk the investors. Because the problem with REIT is

they can run the management fees up and they take all the money, put them in their pocket, and there's no profit. And so the investor gets no profit and there's no cash flow out of the thing. And so you can milk them. They're not that hard to milk. And so you've got to be with solid people that have a proven record of passing the money on to the investor.

And if you want to play with that, then it would need to be money you could burn. If you do that, then I'd be okay with it. Hey, this is the Dave Ramsey Show. One of my favorite parts of this show is hearing your debt-free screams. You guys are our heroes. You've kicked debt to the curb and you've saved for the future. Now we want to celebrate with you. If you have lived like no one else and are currently in baby steps four through seven, well, it's time to enjoy some money.

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We're stopping in the Bahamas, Puerto Rico, St. Thomas, and Turks and Caicos. It's going to be an amazing, debt-free celebration designed just for you. Don't miss the boat. Head over to RamseyCruise.com today to reserve your room. Zach is in Connecticut. Hey, Zach, welcome to the Dave Ramsey Show. Hi, Dave. Thanks for taking my call. Sure.

What's up? My question is I'm trying to figure out what to do about our house. When my wife and I got married a few years ago, we bought a house close to my job, and it's a multifamily. We rent out the upstairs, live in the downstairs. And it's a single bedroom. Well, now we have two kids, both under the age of two, with a yard that's less than the square footage of the house. And it's getting cranked really fast.

So we're trying to figure out if we should keep the house and buy another one, sell it and just buy a single family home. We have some friends that own real estate and stuff and they all say, don't worry about it, just hang on to it. They've all regretted selling property, you know, so, but whatever. And then they said, just buy a single family house, take on two mortgages, which I don't really like that idea. And I figured you wouldn't either, but I just wanted to get your advice on that and what to do. I love investing in real estate, but I do it with cash. Right. And I would not keep a rental property that has debt on it or that causes you to have debt

by the fact that you kept it. And so my guess is that this house is not paid for and that you don't have enough money in the bank to pay cash for the next house. Right. Which means you're selling this one. Okay. Yeah, you need to sell this. Your friends are wrong.

And then just do something like the sell of this. We buy the new house contingent on the sale of this one. Yeah, yeah. And get that one sold, get rid of it, and, you know, make your move, a standard move, you know, the way people always do it. But don't become a landlord by default, meaning that you just, the only way you become a landlord is I already owned it and I just kept it. That's generally not a good plan.

I mean, generally you want to pick out the particular property that's going to give you a good return on investment, and that's the property I want to buy as my investment property. And in my case, I'm always going to tell you to pay cash for that. It's a little slower to build it that way, but you don't have to do it twice. I had to do it twice because I had $4 million worth of real estate with $3 million worth of debt on it in my 20s, and I lost it all because I was stupid and I had $4 million worth of real estate with $3 million worth of debt on it in my 20s.

And I lost it all because I was stupid and I had too much debt. And there's lots of friends of mine sitting around going, buy rental property, buy rental property. You're not even renting rental property. Well, the freaking stuff owns you if you do it wrong instead of you owning it. And your little dream turns into a big nightmare. And that's what happened to me so i took 30 years the other side of that and started buying real estate with cash and took a while to build by the first one took a little while to buy the second one but you get two or three of these paid for they start making money and you can buy another one then you can buy another one then you can buy another one

you got plenty of time but get into your property get into your home and get it paid for that's your first step and get your family taken care of. That's your first step. Rental property is way on your back burner right now. Thanks for the call. Bob's in Indiana. Hey, Bob, how are you? Better than yesterday, but not as good as tomorrow.

I hear you. How are you doing? Just the same. How can I help you? A couple years ago, my ex-wife now and I had a phone plan with one of the major phone carriers, and we put her two adult children on our plan, which we thought was fine because they were paying for their share of the bill. Well, then as we were going through the divorce, we decided to cancel that, and I went to this phone company and they went to this phone company and

every, everything that I assumed that turned in and I didn't hear anything from the phone company until last week. A debt collector called and said that I had, well, first they said my address was Antioch, Tennessee. I told him I never lived there. Um, and then they said I had 19 devices out and hold like $4,000 to this phone company. So I told him I'll just call the phone company and figure it out myself. So I called the phone company and they said there's nine devices out and I hold them $4,000. So i called my ex-wife and

she got a hold of her kids everybody said they turned everything in so i called the phone company back and told them i wanted an itemized statement of what devices were still out and an itemized statement of the bill and i don't know what to do after that yeah i think you just keep tearing into them it's not going to go away until you root it out uh it'll come back 20 times if you just forget it if you just ignore it and walk away it'll show up it'll end up showing up on your credit bureau you know some vague lawsuit will come in 10 years from now or something and so you're smart to just stay on it until you get the account cleared it sounds to me like that they have made a clerical error on their end, that there's an error on the account.

What you've described here is not logical. Would you agree with that? Right. The information that you have from the family indicates this account was closed up properly by you and by the kids, and the devices were all turned in. There were probably never even nine devices out in the first place, were there? I know of five. Yeah, that's what I'm thinking.

I mean, unless there's a whole bunch of kids here. I mean, my God, how do you get to nine? You know, so that just tells you right there that there's something screwed up. So this is typical incompetence with a cell phone company and you're dealing with incompetent people on the other end by and large so you have an uphill battle to get this mess cleaned up but i would keep shoveling until you get the barn clean okay and just stay on it don't you know don't don't let them push you into giving them money for something you don't have and you may ultimately have to hire an attorney

to sue them to clear your name that would be horrible i hope you don't but i have had to threaten to do that a time or two so all right uh jeff is in cal. Hi, Jeff. Welcome to the Dave Ramsey Show. Hi there. How are you doing? Better than I deserve. What's up? So, yeah, me and my wife started an FPU tonight, so super excited about that. Starting off with Baby Step 2, we have about $51,000 in debt, only about $1,000 in a credit card that'll be paid off within about a week or so um the rest of it is we have a travel trailer and we have a truck pretty stupid decisions to finance out those but we did it so um i don't want to spend the next two years you know paying off those uh you know vehicles i guess you would say and i wanted to uh possibly try and

get rid of them and just buy a car that's cheap cash to free up about a thousand dollars a month to be able to start saving up for baby step three and then 3d um i wanted to find out how you would go about doing that who is the debt with on the travel trailer um i believe it is i'm not sure my wife pays that bill i'm not sure. My wife pays that bill. I'm not sure. I think it might be State Farm. Okay. I think it might be State Farm.

Okay. That's glorious. And the dad on the truck is with who? Who might that be with? Alaska Federal Credit Union. Good. Okay. Both of these give you some hope, the credit union the best hope,

because I'm guessing you're upside down on both of them, meaning you owe more on them than they're worth. Agreed? The truck I'm about even on and the travel trailer, I want to say that we're upside down by probably about $4,000 or $5,000. Okay. You've got to have the $4,000 or $5,000 to sell it. So if the buyer brings you a a check for four thousand

dollars less than you owe you can't give them clean title of the trailer without the other four grand so you've either got to save that up or you got to borrow it or state farm has to allow you to sign for the difference on an unsecured loan i've never done business with state farms lending arm i've done business with other parts of them, and I've never had a glorious experience ever, including when a guy hit my car. I couldn't get the stinking claim out of him. So they're a pain in the butt, but you can try. Alaska Credit Union might loan you the $4,000 to get out of the trailer, even though it's over at State Farm as an unsecured personal line. You could do that, or you could save up the money, or you could have a big garage sale and scrape the money

together or whatever. You get the money together and that kind of thing. So that's the process you're looking at. So the truck is our only means of transportation between me and my wife and my kids and whatnot. So we want to be able to save up for a car as well, which is something cheap. You wouldn't recommend getting maybe a personal loan for eight grand to be able to subsidize for that car. That'd be fine. That'd be fine. You still end up way reducing your overall debt, and that'd be a plan. Hey, thanks for the call. Appreciate you joining us.

Thanks to James Childs, our producer kelly daniel our associate producer and phone screener i am dave ramsey your host and we'll be back this is james childs producer of the dave ram Show. Once again, you made The Dave Ramsey Show one of the top five most downloaded podcasts last year. To get your daily dose of motivation and inspiration, subscribe today.