The Ramsey Show - App - The Real Price of Credit Card Rewards (Hour 1)

Episode Date: June 17, 2022

George Kamel & Kristina Ellis discuss: Rising rent prices,  The freedom of being debt free,  Should teens be investing, The real price of credit card rewards. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

I'm out. From Ramsey Network, this is The Ramsey Show. We help you get control of your money, get ahead in your career, and get on the path to living well. I'm Ramsey personality, George Camel, joined today by fellow Ramsey personality and best-selling author Christina Ellis. And we are so pumped to take your call, so give us one, why don't you? 888-825-5225. This is a momentous day, Christina, because it's our first time co-hosting together. Yes, I'm so excited. It's a day you've been dreaming of since you were a little girl, I'm sure.

I know. Like one day, I'll host a show with George. No, no one dreams of that. The infamous George Campbell. But this is exciting. So we're going to take your questions, your money, your life, your career, your relationships, student loans, college. We want to talk about all of it.

The number is 888-825-5225. David kicks us off this hour in Jacksonville, Florida. David, welcome to the show. Paul, thank you so much for having me. Sure. How can we help? All right. So I just had a question about my rent and whether or not it's reasonable for me to be paying what I pay, given how I'm in a unique circumstance. Okay. How unique? So I currently make around $59,500 before taxes per year, and my rent is $1,788 per month.

Yeah. Tell me about it. Yeah. And so my net pay, my net take-home pay after taxes and, like, healthcare deductions and all that is right around $3,955, I believe. And so if I do the math, that is around, I think, 40. Yep, exactly. Brilliant. Yeah. Okay. Exactly. But the interesting thing is that I don't have any, I'm very, very fortunate in that I don't have any student loans or credit card debt or like a car payment. So you have no debt whatsoever? Correct.

Okay. The hesitation worried me. I was like, what are you hiding, David? What do you got? So no debt whatsoever. All of your income goes to you. But again, you're saying, hey, my take-home pay after rent comes out, I got barely anything left over. Right. Yeah. Did the rent recently go up? No, it's been going on for a while. And is it a one-bedroom apartment?

What are we talking? Yeah, it's a one-bedroom apartment. Okay. Are there alternatives in the area that are cheaper? What's kind of the market like where you're at? Yeah, that's the thing is that I looked at some other places where I live. So where I live right now, I want to just, you know, to move to a place near the office, you know, just save on gas. I mean, the good news is, like, I can walk to the

office where I work at. So it's a good benefit. Are you single? Yes. Okay. How is it fitting in your budget right now? Are you feeling pretty stressed? Are you barely making it to the end of the month? Like, what's it feel like? How's it fitting with the rest of your expenses? Yeah, I do feel stressed. Do you have an emergency fund?

Oh, yeah, absolutely. Yeah, savings-wise, yeah, absolutely. Yeah, it's, yeah, yeah. Savings-wise, I'm okay. It's just I just don't like spending more than I make. Sure. Well, you're currently not doing that, right? It sounds like you're living on less than you make. There's just not much left at the end of the month.

Exactly. Are you investing 15% into retirement? I can't do that. I mean, I think it's, well, are you talking about like 401k-wise? Yes. Like percentage of like my paycheck? Yes. Are you investing currently? I currently do 3%, I believe. You get 3%. Is that a match? Yeah. Okay, but you're not investing beyond the 3%. Right, just because rent is so expensive. So where's all the other money going?

I mean, is it just you're trying to cover bills? I mean, you don't sound like you're living frivolously here. But how much money is left at the end of the month? Because you should have some margin if you have no debt. Right. I think around like $500. Okay. And where is that $500 going currently?

Just in my savings account, my checking account. Okay. If I'm in your shoes, I'm going to up that to 15%, and that might mean you have less margin at the end of the month. Are you doing a budget every month currently? Sometimes. Okay. Not every month. I think that's going to really help you feel like you have some control over where your money's going, because right now, it's just a lot of emotion, and just it feels tight, but you're not sure why, and when you start paying attention to where every single dollar is going, it has an assigned job and a category, that's going to be a

huge help. So I'm going to gift you one year of our premium budgeting tool, EveryDollar, so that you can get on that path and figure out where every dollar is going. And hopefully you'll find some money in the couch cushion there, you know, proverbially speaking. Yeah. And I would also just think about like, what are your goals? How aggressively do you want to save? Personally, I would feel pretty nervous having my housing cost be 45% of my take-home pay. So, I mean, you could consider maybe moving. If you want to really stay close to work, maybe you could get a two-bedroom and have a roommate

and split the cost, and it'll be a little bit less per month for each of y'all. Or maybe you could live five minutes away from work and drive, or maybe find somewhere where you could bike to work that's a little bit less per month for each of y'all. Or maybe you could live five minutes away from work and drive or maybe find somewhere where you could bike to work that's a little bit cheaper, especially if you're hoping to save up a down payment or have money for retirement. I'd probably look into it. Yeah, we need to figure out this situation and go, can I move further out? Are there other apartments in the area that are cheaper? Can I find a roommate and split the cost to where it's now

25 30 percent of my take-home pay that'd make me feel a whole lot better would you be willing to get a roommate oh absolutely um the only thing is i don't quite know many people in the area except for you know people that are at work um and are your co-workers feeling the same pinch? Have you talked to them about this and see, hey, what do you pay for rent? Where do you live? Oh, absolutely. Some of them have told me that rent is crazy. Well, I feel like especially nowadays, there's so many ways to find roommates. I love your idea of checking out if coworkers are looking for roommates,

but there's also Facebook groups in the community. There are apps available. Especially Jacksonville. I mean, that's a populated area with a lot of young people. How old are you? I'm 25. Oh, sweet. Yeah, there's got to be another 25-year-old out there.

I mean, the age doesn't really matter, but I want an 18-year-old moving in with you or a 75-year-old. So maybe find someone who's in your same kind of stage of life that you can figure out a way to shave down those costs. But I think right now I'd up the investing. You have the money there. I wouldn't just waste it sitting in a savings account when you already have your emergency fund. I'd rather have that growing with compound interest so that when you're 65, you're thanking me later for the millions of dollars in that account. Thanks for the call, man. I know rent's a tough one right now, Christina. It's up everywhere, but Florida especially, it's bad. Yeah, it's stressing a lot of people out.

Thanks for the call, David. Appreciate it. This is The Ramsey Show. You've got a lot on your plate. A job, your home, your marriage, and your growing family. While you're enjoying the present, you can't help but think about your future and your finances. As you explore your options, consider Christian Healthcare Ministries, or CHM, for your health care. Their generous maternity program and budget-friendly monthly programs have been a blessing to members welcoming children into their families. Visit chministries.org slash budget to see if it's right for you. Christian Healthcare Ministries is a Ramsey Trusted Provider.

I'm George Campbell, joined today by Ramsey personality Christina Ellis, and we are taking your calls, America. The number to call is 888-825-5225. Well, we are headed back out on the road. We've done a few events earlier this year, and the fall is going to be jam-packed. So imagine the energy of an arena filled with people who are ready to experience what it means to live life to the fullest. Now picture all of your favorite speakers on a stage, empowering you with tools and principles that will create unstoppable momentum in your life. That is Smart Conference.

It's been three years since we've done this event, and it is seriously my favorite event we do here at Ramsey, and we're pumped to get it back on the road in Dallas, Texas on Saturday, October 22nd. This is not just another pep talk. This is thousands of people like you coming together under one roof to learn how to build wealth, achieve their goals, strengthen relationships, and so much more. And we have a good time too. It is very entertaining. We pull out all the stops for this one. All of us Ramsey personalities will be there, including Christina Ellis to my right, and some special guests, Craig and Amy Groeschel from Life Church.

They'll be there as well. Event passes start at just $39 for an all-day event. That's amazing. And there's no Ticketmaster fees, which would crank it up, you know, double that. So that's the good news. Inflation has not hit us here at Ramsey Solutions. So go get your passes before they sell out. Ramseysolutions.com slash events is the place to go.

Josh joins us up next in Hattiesburg, Mississippi. Josh, welcome to the show. Yes. I have a question. I don't know if I'm in bad shape or good shape. I feel like I'm in good shape. Financially? Yeah.

Okay, just make sure we're talking the same page here. Yes, yes. Let me just start with the bad first. I owe $190,000 on my farm. Okay. I owe $54,000 on my truck. I owe $32,000 on a piece of equipment and about $28,000 on another piece of equipment. Now, after taxes, I bring home $150,000, sometimes a little more if I work more. In my bank account, I have $360,000. In a law firm, I have $600,000. In my 401k, I have $1.1 million.

And on my farm account, I have $392,000. My question is, should I pay my farm off and lose all the tax credits I get from the federal government every year, or should I just keep going like I'm going? Well, do you like where you're headed? Well, my numbers always say good, but I don't ever spend nothing. I don't own a house. I don't own a house. I don't know. How would it feel, though?

Picture this, Josh. How would it feel making $150,000, and the only person you owe is Uncle Sam, and after that, you take all of that home, and you get to do what you want with it? It's not going back out to the automotive lender. It's not going back out on the equipment loans the farm loan how would that feel well i've always said if everything's paid off and i had five hundred thousand dollars just in my bank account i would be happy you have the money you just told me in the bank to pay this off today all of it right the equipment the farm. Like, I don't sweat my bills, you know?

I don't sweat. I live very comfortable, you know? You've been able to out-earn your stupidity so far, and it's worked out. But the moment that it's not the case... Yeah, so you've dug yourself into a hole, but you got a big shovel. Yeah. And so you've been safe because of that. But, man, I just...

I look at your picture and I go, you're doing so well in so many areas. You don't need debt. I don't need, okay. You're a millionaire who's a very successful farmer. You've got a great head on your shoulders. You've got an incredible work ethic. And so if I subtract debt out of that picture, I get real excited about Josh's future. Yeah, I do too, but I don't know. I watch too much news, and I'm always worried about inflation. Will this even... When I get older, when I'm in my 60s or 70s, the Lord lets me to live that long. Will I live comfortable then? Will I be able to live comfortable? You can live comfortable right now. You don't have to wait until you're 70.

If we get this debt out of your life, it's a whole new picture. And you're not, if you think you're scamming the government, getting those tax credits, man, you can do so much better than that. The White House is not blessing you. Josh has blessed you. The Lord has blessed you with this incredible work ethic and this business you're running. And so I'm not doing nothing for the tax credit. So in other words, just pay everything off and just go with like I've been doing.

Dude, you could be completely debt-free today. Own the farm outright. Own the truck outright. Own the equipment outright. It's going to ride different. Well, it sounds like you're a little bit nervous. Yeah, but I don't know if you know much about farming. After about, I don't know, eight or nine years, equipment starts breaking and all that. What I do is I just turn around and start getting a brand new one.

That way I ain't working on it every day. Well, I don't know much about farming, but I know a whole lot about debt. I know how it steals from your income and that it's a thief and it robs you from your future. And you just work too hard to be dealing with this mess. You're not a broke farmer. You don't need to be carrying around payments the rest of your life.

Well, and it sounds like you're a little nervous about the economy and inflation and one of the best ways to protect yourself is to be debt free. Like, having debt, that is a risk. When crap hits the fan and you owe no one nothing, it changes how you make decisions, Josh. Yeah. You're not freaking out trying to sell things is a risk. When crap hits the fan and you owe no one nothing, it changes how you make decisions, Josh. Yeah. You're not freaking out trying to

sell things at a deal. Yeah. For being as young as I am, I think I'm doing good. I ain't 35, and I think I've got a hope of everything right now. You're doing great. Well, what's so great is you are still young, so you're talking about, you know, as you get older, are you going to be at any risk?

And it's like, right now, you could be debt-free and continue to build talking about, you know, as you get older, are you going to be at any risk? And it's like right now you could be debt free and continue to build like this is, you know, you have so much time ahead of you to keep building and building your savings and building your retirement. You're already doing so awesome. But to do it without debt is just going to be that much more powerful. And if you want to get angry at it, look at the interest you're paying on this $300,000 worth of debt. Add it up every single month. Oh, 0%. I got it through a federal grant loan. The farm, the truck, all of the equipment is all 0%?

Yep. I don't believe it. Not for a second, Josh. Yes, sir. Yes, sir. So if you could take out another half million at 0% today, would you do it? Oh, no. I wouldn't take that.

No, no. Then let's get rid of the current one. I couldn't pay it back. Because you have $300,000 sitting there with 0%. Yeah. Man, I'm telling you, when those payments don't go back out, when they stay with you, it's going to change everything. It's going to change your spirit. It's going to change your mentality, your mindset.

It's going to take a literal stress off of your body. Yeah. Like, I got the money, but, you know, just going back down to zero, but yet being debt-free. You're not going to zero, dude. You owe people money. It looks like you're doing well because you have a bunch of money in the bank,

but that money has a name on it. Well, and you're not going anywhere close to zero, right? You said you have $600,000 in your rod. You got $360,000 in the bank. You got a lot of money sitting around, bud. Well, you know, my grandma really helped me. She really showed me how to be frugal and all that and reading my Bible and I read it and I just listened to God a lot. I've always gotten by.

I've never bought a house. I've never done that. I never went to college. I never took out more than what I did. In the last five years is when I accumulated my debt, but I made sure I had my money. I didn't pay it off because somebody told me, oh, you get these tax credits from the federal government.

Who's somebody? It wasn't God or Grandma, I'll tell you that much. No, it wasn't. It was another farmer, which he went bankrupt. So maybe I'm thinking... Well, maybe we shouldn't take financial advice from that farmer. Maybe we should listen to God and Grandma, which is how we run this show. God's and Grandma's ways of handling money.

And if you read that Bible of yours, it'll say the borrower is slave to the lender, doesn't it? Yes, sir. And it doesn't feel like it because you've been able to out-earn this. Because you've got a pile of money. You've been doing some things really diligently and really well, but you could be doing way better if you cleaned up this mess

and you can do it today. That's the best part. There's not a lot of sacrifice. You're just moving some money out of a bank account, paying off your debt, and end of the day, you're debt-free. All right, well,

sounds good. Well, now I know what I should do. Now I know. There we go. Josh, you're crushing it, man. I appreciate the call. Wow. Yeah, that's impressive. It's rare, Christina, to see a guy who's doing so well. He's got over a million dollars sitting in retirement accounts. He's got so much money in the bank, but he's hanging on to the debt thinking it's a blessing in his life. And so it's a simple fix. This is a great situation to be in. He's not broke. He's got a great income. He's got plenty of money in the bank. Game on. Now let's live our life with freedom from now on. That's what I want for Josh. Give us a call. 888-825-5225. This is The Ramsey Show. I'm George Campbell, joined by Christina Ellis today. This is The Ramsey Show.

Give us a call, 888-825-5225. On the line, we've got James and Katie from Ocean City, New Jersey. And I see on my screen that you guys are debt-free. That's right. We love to see it. How much debt did you pay off? $389,000. Whoa. And how long did that take? About four years. Okay. Making what range of income during that time? We were at $130,000 to $548,000. Okay. What do you guys do for a living? Well, I have like a little side hustle, and I take care of the kids, and I help with real estate.

I'm in real estate. Aha. And apparently things have been going well the last few years. Yes, they have. The past two years have been really good. We live at a beach resort, so it really took off. And everyone's trying to escape to the beach these days. So this is all residential real estate? Yes, residential real estate, yep. Good for you.

Well, you must be a rock star real estate agent. That is awesome. Okay. Thank you. So tell us about the $38. That is awesome. Okay. Thank you. So tell us about the $389,000 debt. What kind was it? Let's see. We had credit card debt.

We had a rental property that was losing money every month. And our house and a lot of stupid investments. Whoa. So you paid off all this debt and decided let's just pay off the house too. That's right. That's incredible. Way to go, guys. How old are you two?

I'm 45. And I just turned 40. Oh my goodness. And you've got a beautiful family. If you're watching on YouTube, you can see them in the pup as well. What a picture perfect family. This is incredible. So tell us about this journey. Four years ago, you guys had a great income. You were living a normal life, credit cards. You had rental property investment debt and your mortgage.

What happened four years ago that got you set on this path? So about six years ago, I had taken a team leader position in a different state. We relocated our family, and during that year, we ended up going broke. The job brought me to my knees. I ended up having a relapse, and our marriage was falling apart. Wow. That was six years ago. Yep. So you started kind of climbing out of that with recovery and trying to keep this marriage afloat? Yeah, we ended up moving back home and had a lot of people around us for support. I was in groups, and we were in counseling for a while,

and we just had a lot of people come into our lives and just got close to God and had him guide us through it. That's incredible. And how did you get connected to us? Well, during that time, it was obviously really challenging. And when we found Dave Ramsey, that was like the first step to rebuilding our marriage. We were pulling on the same rope for the first time, probably, in our whole marriage. And we're not exactly sure, but I think we stumbled on the podcast. And then I have the side hustle business.

It's cleaning, and as I was scrubbing toilets and cleaning up after everyone's fabulous vacations, I would always listen to the podcast, and that was like my why for getting out of the debt, and Jimmy didn't help me clean toilets, but he did the same. Yeah, a lot of sacrifice was made. And, I mean, you guys just were going, we're going to fix this marriage, we're going to get our health back, and we're going to get our money back. What would you say was the hardest part of paying off the debt?

Just staying focused um what helped was just the little wins we never i think we had a vision of like paying off our house but it wasn't real clear like that's a distant future kind of thing um but you're the system works um so we just got little wins along the way, which created the momentum and realized like there is a path to, to make it happen. I love that little wins, especially y'all talked about how, you know, you had just been through so much in that season, job loss and addiction and all of that. And to see those little wins, it's like, it doesn't have to be major. It doesn't have to be all at once, but to make that incremental progress is powerful. That's awesome. I love what Katie said.

You guys started pulling on the same rope. You started going in the same direction, and you started feeling that progress when you get on the same page. You guys are incredible. So what's the house worth? Around $450. I love it, and it's all yours.

That's right. Yep. Did y'all have some cheerleaders in the process? We did. My parents were huge in encouraging us and just supporting us through that challenging time. And my dad always loved talking about money. Our pastor and his wife, Ron and Stephanie. Mike and Joel, we go to church with them and we would always have fun with Dave Ramsey-isms,

just laughing about stuff. And our families just were always a big support to our sisters. That's huge. Never underestimate the importance of having the right people in your corner cheering you on. Not just for money, but for life. Yeah, absolutely. Yeah, they were a big part of that. So talk to that couple that may be facing some of the stuff you guys were facing six years ago. The marriage is hanging on by a thread. There's addiction. You just feel like this will never get better. What do you say to that couple? What is the key to getting out of debt? So, yeah, what I kind of go back to is opportunity comes dressed in overalls and looks a lot like work. You love saying that.

Love that. And just speaking the stuff into light, too, because that's where God is real powerful. He shows up. We get it out of inside of us in those deep, dark spots and just speak it into light and he'll show up. That's powerful. It reminds me of the quote, pray like it all depends on God, work like it all depends on you. And you guys were a great mix of that, and you got plugged into your church community, and you just set yourselves on a path where you said, no more. And now you have this incredible income, you have this beautiful family,

and you get to keep it all. You get to leave a legacy and change your family tree. We're so proud of you guys. How does it feel? How does it feel to be completely debt-free? It feels great. I mean, we definitely struggled when we paid our last mortgage payment because we were like, okay, now what?

Like, what are we doing now? Because we were so focused on that for, you know, rebuilding our marriage, working on our financial issues. And so we're in this season where we're like, okay, now what are we going to do? The kids have lots of ways we can spend our money. Oh, yeah. Well, now it's vacations and college funds and building for the future and building wealth

and being outrageously generous. That's right. Giving for sure. I love it. Well, we're going to send you guys a copy of Dave's number one bestselling book, Baby Steps Millionaire, how everyday people build extraordinary wealth and how you can too. We're also going to send you the total

money makeover to get someone else set on their journey to financial freedom. And we're going to gift you guys one year of Financial Peace University and our premium budgeting tool, EveryDollar, and it's all included in Ramsey Plus. We're going to give that to you guys. You can use it yourselves or gift it to someone else. Awesome. Thank you. It's the moment we've all been waiting for. James and Katie, Ocean City, New Jersey, $389,000 paid off, house and everything in four years,

making $130,000 all the way up to $548,000, crushing the real estate game. Count it down, guys. Let's hear a debt-free scream. Ready? Three, two, one. hear a debt-free scream. You ready? Three, two, one. We're debt-free! You can hear the children in the background. I'm pretty sure I heard the dog in there, too. They were all jumping for joy. That's powerful. That's inspiring. I mean, beating addiction, restoring a marriage, getting completely debt-free, that's a good day in my book.

That's a whole journey. If you needed some good news, you just got some. Transformation is always inspiring, and it's out there for you, America. It's available to you. You can do it. You just got to put in the work like James and Katie did. It's possible. This is The Ramsey Show. I'm George Campbell, joined today by Ramsey personality and bestselling author Christina Ellis.

And if you've seen Borrowed Future, the documentary we put out, Christina was featured in it with her amazing story of getting a half million dollars in scholarships, going to college completely debt-free, and your master's as well. Yes, thank God. Pretty amazing story, Christina. Oh, yes. Thank God. It was such a blessing. And I'm honored to get to share with students now about how they can go to school debt free too. So many people think that the only way is debt. You have to take out a student loan. It's totally normal. And I'm glad my story is proof that that's not true. I'm glad that there's other stories in the documentary of people who went, you know what, I'm taking loans off the

table and I'm going to figure out a way to go debt-free. And it's inspiring, and I think it's so important for students to see this because we've got to fight this toxic culture that says that's the only way. That student loans are, quote, good debt because it ROIs, right? You're going to make so much money. If you have a degree, you'll pay it off in no time. Oh, boy. And here we are 20 years

later and people are still paying down their student loans. The interest is climbing. The balance is higher than when they started. And they're going, please help White House. Someone fix this for me. Right. That's a huge problem. Huge problem. And part of why I'm so passionate about helping this younger generation is because I see my friends, I see people my age who bought into that lie and they thought, you know, it's all going to work out. Of course, I'm going to get a great job. I'm going to be able to pay this off easily. All the adults in my life at 17 told me that it's going to work out.

A lot of assumptions. A lot of assumptions. And now they're dealing with the pain, and they're putting off getting married. They're putting off buying a house. Major life decisions because they feel trapped by student loan debt. And I think we've got to do better for the next generation. Well, we are glad you're here to be the preventative medicine for this next generation and help them avoid that trap.

Love it. 888-825-5225 is the number to call. We'd be happy to take it. Luke joins us up next in Salt Lake City, Utah. Luke, welcome to the show. Hey, it's an honor to be on the show. We're happy to have you. What's going on? So I'm 14. I'm a luncher in my neighborhood. I make about $130 a week. And so I know it's not a ton of money, but I do have some. And I was wondering

if it'd be a good idea to invest some of it. What's your situation, Luke? I mean, do you have expenses for this business you're running? No, just something to get money. Do you have any money in the bank currently? Yeah, I have about $2,000 saved up. Way to go. You are so far ahead of most American adults, so I'm really proud of you. That's incredible. You've got a great work ethic at 14 years old. Yeah, Luke, what are you thinking about for the future? Are you thinking college or what's your plan? So just to work through high school and then go on a two-year mission and then come back and go to college.

Awesome. What are you thinking about in terms of paying for college? Are you starting to save for that? Yeah, just, you know, work while I go to college and during the summer, cash flow college. I love it. Well, as to your question, should I be investing any of this money? Right now, I want you to invest in Luke.

And so that may not look like a Roth IRA or an investment account because there's so many unknowns over the next eight years of your life that when you have a pile of money ready to go, liquid cash, it's going to change how you make your decisions. And because you're not sure of what's next and what college looks like and who's going to pay for it, have you had a conversation with your parents about this? Are they saving up for college? Not much. Not much. Okay. Here's what I'm going to do. I want you to go watch Borrowed Future with them. Say, hey, mom, dad, movie night, we're going to watch Borrowed Future. We're going to gift that to you. Austin will pick up after

we're done here and make sure we get you a code so that you can watch that. I would think that's going to spark an awesome conversation with you and your parents because clearly it sounds like you want to live your life debt-free. Even at 14 years old, you're calling into the show. You know what we say around here. Yeah. And so my A1 for you is to get you through college and get you a job without ever touching debt, without ever touching a credit card, because, dude, you don't need one. You're so sharp. You're going to do so great.

You're going to build so much wealth if you just stay on this path. And so I just want you to figure out what those next plans are before we go dump this money in retirement accounts that you can't touch until you're 60. You know what I mean? Okay. But, Luke, you're doing awesome. To be out there creating a business, running a business, making consistent income, and building your resume for the future, that's just incredible.

Yeah, I would just park all the money you can in an online savings account for now, and over the next five years, who knows, maybe you have $50,000, and we go, great, we can actually pay for college now and cash flow it because mom and dad weren't able to help. So we just don't know what that future holds. And worst case, if they cover college 100%, you get scholarships, you have $50,000 you can now use as a down payment, you've got your emergency fund, you're ready to invest, and you're going to go full throttle at that point. So I'm not worried about you becoming a millionaire. It's going to happen if you stay the course. Appreciate the call, man. Thank you so much. Ann joins us up next in Austin, Texas. Ann, welcome to the show. Thank you very much. I just have a quick question. And I'm a believer in Dave Ramsey long before I ever heard about him. I saved, I did all kinds of things.

And I've been to school, Ramsey School. But there's just one thing I don't do that I know is not according to the plan. And that is I use my credit card. Aha. And yes, I do. And because I like the perks. So yesterday I went out and I got a nice Nye's computer, which I needed, and charged it. I have the money in the bank now to pay for it, and I do pay off my credit card every month.

Okay. If I pay it now before it goes through the next cycle, the next month, will I still get my perks or will they just wipe that off? I'm kind of anxious to pay it off, not wait. Well, I love the idea of you paying it off. I don't love the idea of doing it so that you can get the perks. And so I'll answer it twofold. I'm not a credit card company, so I don't know how snakes work. I don't know the inner workings of them. But you're not winning here. What was the perk that you went, all right, I'm going to charge the laptop to the card. What's the perk you're getting for this?

Well, I get money back, a percentage of the money I spent back. Well, last year I got about $600. Okay. Now, take all of that money. And I need it. And if, let's just say you could have done better if you used your own money. Do you think you would have made different spending decisions at all? If you're going to be brutally honest, would you have made different spending decisions if this was all coming from your bank account and you got no perks? Would you have spent less? I don't, I don't almost think you can't do that. I think you have to do it wrong.

But I am very frugal. I'm not crazy out there. But yes, I'm sure I did spend money I shouldn't have. Well, I'll tell you this. I don't think there's a difference if you pay it off today or pay it off in a month. I still think you're still going to get your pennies on the dollar for your cash back that's changing your life. So you can continue to do that, but I would encourage you to make Ann her own cash back program where Ann now has the margin to give herself $600 because she has margin

because she's doing an every dollar budget. She's using her own money. It's changing how she makes decisions. What do you think about that? How is that for a cash back program? That's a good one. That's a very good one. I like this idea. I'm self-insured every other way. Here's a test, Ann. What if you cut up the card and for, let's say, one month, you just use your debit card and you call me back and tell me if you missed the perks and tell me

if you spent differently because of that. Would you be willing? I don't know if anyone has ever done this test. Would you be the guinea pig for us? I'd love to. Oh, my goodness. Okay, Ann. Listen, I want a call back one month from now. It's June 17th, July 17th. Call back into the show.

Austin will definitely remember Ann from Austin, Texas. And you're going to report back on this experiment. I want hard numbers on how much you spent and if you missed the rewards. Because truthfully, do you have any debt, Ann? You said you pay it off every month. You do everything the Ramsey way but the credit cards. Yes, the house is paid, the car is paid.

Oh, you're amazing. I have no debt. Ann, you're crushing it. You don't need to be playing with snakes. You don't need this credit card. You're doing so well. What's your income? Well, I have Social Security and I have a small annuity from my retirement.

Okay. And that's enough for you to have a comfortable retirement? No. Oh. Well, that's a problem. What are we doing to supplement that? Well, I've sold everything that moves in the house. My husband passed away, and he was making very good money, but it didn't come to me. So in a moment, I had all of the bills and not much money to pay for. Oh, my goodness. Well, Ann, here's the deal.

Here's what I'm telling you right now. The credit card companies are not going to help you have a comfortable retirement. That $600 is not a gift that's going to bless you in retirement. So let's cut it up. Let's get on a plan. Call me back in a month. Let me know how the experiment went using your own money. I'd love to hear about it. I love this experiment. This is amazing. That puts this hour of The Ramsey Show in the books. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube. Go watch and subscribe to the Ramsey Show channel on YouTube.