The Ramsey Show - App - There’s Never a Good Reason To Stay in Debt (Hour 1)

Episode Date: September 25, 2023

Девочка-пай Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. George Campbell, Ramsey personality, co-host of the Smart Money Happy Hour is my co-host today. Open phones at 888-825-5225. That's 888-825-5225. Paul is with us in Minneapolis. Hey, Paul, welcome to the Ramsey Show. Hey, Dave. Thanks for taking the call. I have another should we pay off the house early out of our retirement question for you. Okay.

Why is this one different? Well, my wife and I are both retired. I'm 61. She's 58. We retired with the mortgage. Uh-huh. And I've got a number of differing opinions from our financial guy. I've got friends that work in the finance industry. I worked for a bank in 30 years.

I guess just looking for another opinion, maybe one with a little bit more credence than some of the others, I guess. Okay. So how much do you own your home? It's a $450,000 house. We owe $170,000. And how much do you have in your nest egg? What's that?

What's your net worth? What do you have in your nest egg? Net worth is about a million and a quarter. We've got just over a million. That is investment and retirement. If your house was paid off, why would you go borrow on it? We would not. Then what's the difference? I guess it's just, okay, let me rephrase the question.

Maybe a better question is if we decide to do this, is it a process over multiple years to ease a tax burden do we just bite the bullet and take the hit and do it once or how how would i do it i've been doing this 30 years i've never had anybody call me back and say they were pissed off because they paid off their house fair enough so shot, or would you... I'd write a check today. I'd be debt-free. I'd have been debt-free yesterday if I were you.

And quit listening to all these idiots. There's a lot of idiots out there running around with an opinion about your money, and you're a millionaire. What's your mortgage payment? All right, I'll... Go ahead. What's your mortgage payment right now? Mortgage payment is, what, $1,200?

Okay, you'd free up most of that, which now you can invest. So yes, you'll lose some out of that investment account, but you're going to still invest for the next 20 years. Dude, you're just going to sleep so much better tomorrow. I mean, we're both retired, so invest is rolling, not necessarily additional. You have almost zero risk in this situation because you could write a check at any minute and pay it off. If you got in a pinch, you don't really need the money in one way or the other. It's all about, you know,

what is your end goal when you're 85? Do you want to have a mortgage? You know, why would you keep it? There's no reason to keep it. You wouldn't go borrow on a paid for house in order to have more money to invest. And so write a check and sleep better tomorrow. Tonight, pay it off tonight. Hit the submit button. And then when you go and you get the mortgage release in the mail, make a copy of it, take your shoes off, walk into the backyard, have a mortgage burning party, and tell me that didn't feel good. I mean, there's just no downside to this. You know, you're a million, you're going to be okay either way if you don't follow our advice, if you follow those idiots' advice. But if I've got a financial person that's telling me to stay in debt, I'm getting a

new financial person period because george we studied 10 167 millionaires the number of them that told us that they became wealthy because they borrowed on their home in order to invest was precisely zero none of them leveraged their personal residence to build their wealth none of them and so the idea that i continue to leverage my personal residence in the name of building wealth is an asinine based on the millionaire data well we're seeing so much more of this because people have their record low mortgage rates they don't want to let go of dave it's like why would i have my mortgage you know but i got your mortgage rate beat you know what my mortgage rate is zero i don't have one hello heck of a rate zero i got

the best rate come on man so when it's up and down you don't have to worry about them because you don't need debt anymore that's a great feeling instead of worrying about what the market's doing so yes it hurts to write that check and lose that much money lose quote unquote but you never really had it if you owed it to the lender in the first place. Paul, pay it off, son. Pay it off. There's a bunch of intangibles that you're not even considering in this decision. You're still acting like it's primitive math, or at least the idiot's advising you are. So you're going to sleep different. Your wife's going to look at you like a hero. Never once have we had a wife said, you know, my husband borrowed deeply on our mortgage, and he's my hero.

Never came up. I love the Kermit vibe she had, too. That was great. Kind of a Miss Piggy meets Kermit. Well, it's the best I can do. It's the best I can do. Anna, as with us, is it Anna or Anna? It's Anna, I'm sure.

And she's in Grand Rapids. Is it Anna? Is that right? Yes, it's Anna. Hey, how can I help? So I recently paid off all of my student loans and am debt-free. Yay! Way to go!

Thank you. Yeah. So I couldn't have done it without you. But I have my three, six months of expenses. I just finished that up. And I'm wondering now if I should be investing my 15% or if I should be saving for a wedding that my boyfriend and I are planning to have in about a year and a half.

So I'm wondering if I'm saving for that. Wedding. Yeah, okay, perfect. Are you guys paying for this on your own? We think so. We don't really want it. We just want to plan for that and that if something comes, then we'll go for it.

But, yeah, we kind of just want to plan on doing it ourselves just in case. Okay, I would set a very specific goal, a number you're trying to hit to save, and I would try to hit that before the year and a half is over and then begin investing. You got that money set aside. You know, you're not going to have to go into debt for this wedding. That is the goal here. And so that's why we're telling you to save for the wedding first. Because what happens is you start investing 15%. The wedding was over budget. Now we got to put it on a credit card. sure yeah so what do you think you're going to spend um we're thinking maybe between i would say probably we're thinking between 20 and 30

depending on what rates are but um probably 25 is the goal we set okay well if you yes that by the way that's about an average wedding in america right now so um you're not above average you're not below average you're right around there's 28 000 last year so the um the thing is having um three grown kids that all got married and i was involved in the budget because i was paying for it um or at least part of it anyway on one all but one all of it but well anyway my part the bride's part and then my son we participate some have a detailed budget not a general goal lay it out okay this is how much we're going to spend on the photographer there's so much we get on the dress there's so much we spend on the reception and treat it i'm sorry but treat it like a project you're managing a project you are so you have a timeline you have a budget and you you know you stick to it what must be true well we can't have that we got to have this instead if you don't have a very

specific thing then you'll line item you'll get into a mess there but that sounds reasonable i would say for the wedding first george camel ramsey personality is my co-host today. Thank you for joining us. Open phones at 888-825-5225. George Camel will be doing a live virtual training this month to help you get clarity with your money. Sometimes those are called webinars, I think. So you're going to learn more about margin in your finances, spend guilt-free, make a budget for you

that works the next one's happening september 26th at 12 30 eastern 11 30 a.m central so it's a lunch deal george that's right and i'm taking my lunch break to do this so i would appreciate all of you joining me we're going to actually walk through very tactically what it looks like to create margin in your every dollar budget we'll show you how to set it up, how the paycheck planning tool works, what to do, what sacrifices to make to spend less, make more, to get out of that stressful money cycle. It's free. So to sign up, go to everydollar.com slash budgeting, and September 26th would be like this week. That's coming up. That's like tomorrow for most of you yeah so uh and you can also get the replay a lot of people say dave i can't make it on my lunch break sign up anyways we'll send

you a link to watch the replay still worth signing up every dollar dot com slash budgeting free webinar free virtual training i like virtual training yeah webinar doesn't i'm way more exciting than webinar sounds very geeky you deserve better than a webinar. Webinar sounds very geeky. You deserve better than a webinar. Virtual training sounds very high tech. I like that. I like it, George. It works, man. One day we'll all be AI anyways. So you'll still get the live version of me today before the robots take over.

Not me. Not me. You don't think AI could replace you, Dave? It already has. Have you not seen it? Have you not seen that stuff? No. Oh, it's hilarious.

Oh, the deep fake. They can deep fake your voice. It's hilarious. It's hilarious. Oh, the deep fake. They can deep fake your voice. It's hilarious. It's hilarious. Yeah, there's actually one guy that's running a scam. I've seen that on social media. On social media, yeah. They're going to get what's coming to them.

I wouldn't mess with Dave Ramsey. I'm just saying. Well, we just had the lawyer call. I'm going to explain it to him. But they knew that. They knew they were scam guys. But it's like me giving advice, and then they change the voice. Poorly done audio voiceover. It's not even AI, I don't think. I so it's just but it's like me giving advice and then they change the voice poorly done audio voiceover it's not even ai i don't think i think it's just a bad voice a bad impression that's even more offensive you'd almost rather have a robot screwed up than

a real person go i'm dave ramsey yeah is that what it would sound like kind of i do a terrible version of you that was that was really bad i know I don't have that southern drawl. All right. Pam's in Los Angeles. Hey, Pam, welcome to The Ramsey Show. Thank you for taking my call. Sure. What's up? I am a 66-year-old widow in good health. The only retirement I have is property, a home and land that I own in Nolensville, Tennessee.

It's fully paid for. I generate about $19,000 a year rental income. There's about $2,000 in property taxes every year. I've got people. My other income is my Social Security, which is $1,800. And then I rent out two rooms in the house that I rent in California for $1,100 a month. That together brings my income to about $54,000. If I sell the property, I'll lose that $20,000.

I've got people telling me to sell and invest, sell and put it in CDs, don't sell. And I don't know what that's going to do with it. What's it worth? Probably six. It was worth more before the laws changed, but it's worth, say, $600,000 to $700,000. Okay. And the only kicker, one other thing that makes it a little tricky,

my son and wife are looking to relocate either to Huntsville or Nashville in the next three to five years. Not tricky at all. Unless it's a family place or something? Is it a family home place? It was never a family home. My husband and I bought it and only lived there a few months before we were transferred to California. Okay. Do you have a property management company running it? Okay. So you're making 2.8% on your money. Okay. She doesn't charge that much, but okay.

No, you're making $19,000 on $600,000. Right. That's 2.8%. Okay. Certifiably horrible. Okay. Yeah. So, yes, I think whoever told you to sell it and sit down with a quality investment

advisor, if you don't have one, click SmartVestor at RamseySolutions.com. We'll help you find who we endorse in your area to sit down and teach you what you could put some of this money in. But if you made 5% on your money, basically, you would double your money. If you made 10% on your money, you would quadruple your money. And somewhere between 5 and 10 is what you should be making, depending on how much of, you know, what you want to put it in in mutual funds. So I'm almost, you know, I'm 63. In my situation, meaning that what I'm comfortable with, I would put, in my case, 100% of that in mutual funds. And my mutual funds have averaged 10 to 15 percent depending on the year okay and

so um and so i would be making close to a hundred thousand dollars a year where you're making 19. but now that those mutual funds go up and down in value more than that property does but whoopty dupty you're not making anything so okay it must be raw land, is it? No, it's five acres of raw land and then a single-family house on it. Yeah, it's under-rented severely. It's a smaller house. It's under-rented severely, yeah, based on its value. But even then, you don't want a rental property in Nolensville, Tennessee,

when you live in Los Angeles. So I'm going to sell that and put it in mutual funds, a good mix of which you could determine after you learn a little bit more about it. But sit down with a good investment advisor, a smart investor, if you don't have one. They'll help you do it. They'll show you what to do, but teach you what you're doing, and then you can make that decision. You may have some taxes on this as well when you sell it. You need to set that aside, but you will have some taxes, but depending on how long you've had it, it sounds like you've had it a long time, so you may have substantial capital

gains, but still you're going to come out ahead. Yeah, you're just, you can't, you're pinching every penny because you're only making 2% of your money. Yeah, and a lot of people, Dave, are fooling with real estate. And then we asked them, hey, what are you making on this thing? Well, $500 a month, $1,000 a month. I'm like, $10,000 a year? That's not life-changing money comparatively to if you just didn't fool with the real estate and invested it.

Yeah. And you could make returns that are much greater than that. So that's what we're talking about here. If you're going to go through the hassle of real estate, I love real estate, but you should make more on it than the stock market's paying. So if the stock market's averaging 10% to 12%, you ought to make more than that on your real estate, all things included. I mean, including the value increases and other things.

But if you're going to screw around with renters and deal with air conditioners breaking and all that stuff, then you would want to make more for the hassle factor than you would make just putting in a mutual fund and forget it. Especially long distance. That's always a nerve-wracking situation when you're across the country. There's nothing in this property for you, Pam, that sounds fun to me. Sounds like a good thing to be out of. Christina is in Seattle.

Christina, what's up? Hi, thank you guys so much for taking my call and everything you guys do. You too. How can we help? I'm calling in. My husband and I are in baby step two, and we're down to our final debt, which is $132,000 of student loans. With repayment coming back online, I've looked into some options to lower my higher interest rate loans down, and I'm not sure if it's worth it to do the refinancing. Okay. You get one shot if they're federal.

Is it a lower interest rate? It is. So out of my 132,000, 100,000 of those are at 6% to 7.5% on a 15-year term loan, and I can refinance down to 5.5% on a 10-year loan is the best option, the lowest option I have. Yeah, sure, and then pay it off in three or two or whatever. Yeah, three. Three is the plan that we're on right now, three years to pay everything off.

Yeah, a lower interest rate helps. So 1% is $1,000 a year on $100,000, right? Okay. That's what saves you. So $1,000 doesn't solve the problem. You being pissed off and getting out of debt solves the problem, but it doesn't hurt. I'll take $1,000 of the good instead of $1,000 of the bad. Okay.

The only place where we were kind of concerned is that it raises the minimum payment up significantly. You're raising the minimum payment anyway. You're getting out of debt in three years. Yeah, paying extra on it's going to do that. Yeah. So that's not a bad thing. Whoopty. Yeah.

We're not keeping this thing around like it's a pet. We're getting rid of it. This is The Ramsey Show. George Campbell Ramsey personality is my co-host today in the lobby of Ramsey Solutions on the debt-free stage Scott and Jenna are with us hey guys how are you doing well thank you hey George welcome good to have you guys where do you live Davenport Florida just south of Orlando oh yeah fun welcome to Nashville and how much debt have you paid? $94,000. Cool. How long did that take? 33 months.

Okay. And your range of income during that time? $76,000 to $145,000. Okay. Very cool. Good. Very good. So what kind of debt was the $94,000?

It was our mortgage. Yay! Love it. Love it. Congratulations. House and everything. Look at it. Weird people.

That's right. So what's this house worth? About $ love it and how much in your nest egg in your retirement about 95 000 excellent well done guys thank you yeah already half millionaires look at you how old are you 36 33 well done you guys good work it's incredible. So what started this journey 33 months ago? Pay off the house and be weird. I know. It kind of starts a little bit farther back. Really, when we first bought the house, we were pretty normal. We got the 30-year mortgage, and we knew about the Dave Ramsey principles and baby steps, but we applied them here and there, kind of Dave-ish, and we held on to the credit card and didn't really make much

progress on the mortgage for the first several years as could be expected. And fast forward to 2020, we started tuning into the Ramsey Show on podcast and listening to the debt-free screams really got us fired up to pay off our mortgage. And so we submitted to refinance and get a lower interest rate and start paying things off. Then we hit a bump in the road, COVID hit, we both got furloughed. So that delayed things a little bit. But August of 2020, just several months later, the refinance went through and we were back in our jobs. And so that was kind of our kickoff moment. What really got things up to speed was in January 2021, just a few months later,

I got a new job as a result of an MBA that I just finished. And we started coordinating Financial Peace University at church. And our class challenged us to really walk the walk. And so we kind of call out the coordinator. I know. So we downloaded every dollar and got our budget nice and organized and focused. And from then on, we were just laser focused on the mortgage. We had a couple of promotions over the next couple of years that increased the income. So we increased our giving, but the rest, we maintained our lifestyle. So we had that margin to just keep catapulting on the mortgage. That's incredible. I love this.

The unexpected blessing of coordinating an FBU class is that it puts your butt into gear because like, I can't lead this class and not be doing a budget and not be trying to hit my financial goals. Exactly. And you guys did that without the lifestyle creep, even increasing your income. Yeah. Yeah. It's just as motivating to be coordinating the class and to hear from those who are taking the class as participating

as just you know someone that signed up for it yeah way to go you guys excellent excellent excellent work so proud of y'all well done how's it feel to not have a payment in the world so good wow what's the first big thing to do you to celebrate so we actually just did it a few months ago the same month that we submitted our final payment we went on a two-week vacation to hawaii yeah so we're going to get your anniversary as well there you go good for you well done guys well done now you got all the rest of your life to do nothing but be generous and build wealth exactly you're gonna be in a great position absolutely amazing all right tell folks what the key, because you're coordinators now. I mean, you're coordinators like a boss now, right?

So you're coordinators. What is the key to getting out of debt? House and everything when you're 36 years old. Without a doubt, the budget for us transitioning from the Excel spreadsheet to the EveryDollar budgeting app made a huge difference for us just to be able to see every transaction come in. This is an unpaid commercial, ladies and gentlemen. Yeah, I got it. Yeah, that's great. But to see every transaction come in and be able to update it in live time was really helpful. But then being on the same page with our long-term goals, because for us, we want to be able to meet needs as we see them come in. And so not having that house payment, not owing

anybody really frees up that income to do that. But also I think just being content with where you are and what you have, not trying to keep up with the Joneses as you go, having that delayed gratification. And then really just like not underestimating the small sacrifices and the difference that those can make too, because it really helps you to build that muscle of discipline as you look at the bigger decisions that you have to make and recently we heard it put that there's no comfort in the growth zone and no growth in the comfort zone oh that's good ding ding dave's gonna steal that quote if you don't accredit somewhere i like that that'll show up somewhere. No growth in the comfort zone, no comfort in the growth zone. Yeah, that's true.

That's really where it happens. That's amazing. Well done, you guys. Thank you. Very, very, very well done. This is exciting. What I love about this, what I'm realizing is

those in Baby Step 7 who pay off their house, there's this natural letting go of caring what other people think. But it's weird that when you're broke is when you're trying to keep up and when you have all these payments up to your eyeballs and you let go of it what other people think. But it's weird that when you're broke is when you're trying to keep up. And when you have all these payments up to your eyeballs,

and you let go of it and pay it all off, and you go, why are we doing that? We've got bigger goals in life. Why was I worried about that guy? Yeah. Which guy? Now you're worried about who can we give to this month instead of who do we got to impress this month. That's a very different life. Exactly.

I'm so proud of you guys to figure it out that early. It takes people their whole lifetime to get that absolutely very well done hey we've got the live and give box for you that's the baby steps and billionaires book that's the next step in your journey for sure and the total money makeover book giveaway get somebody started and since you're coordinating the class we'll give you another financial peace university membership you'll find someone to give that to i'm sure that needs it and they'll be able to encourage them on their journey thanks for leading the class we really appreciate it we really enjoy it it makes a lot of difference uh to have the class for operating like you guys especially when somebody's plugged in like you guys are you know and um and thanks

for the advertisement for the every dollar app that's good very very good. Good stuff. Well done. Well done. Scott and Jenna, Lakeland, Florida area. $94,000 paid off. House and everything at 36 years old, making 33, or did that in 33 months, making 76 to 145. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free!

Yeah! Yep, yep, yep, yep, one. We're debt free! Yeah! Yep, yep, yep, yep, yep, yep. All right. Way to go, you guys. That is so fun. Very good. So proud of y'all. Good stuff, man.

So you're going to be doing an every dollar virtual training or webinar, whatever we want to call it. Webinar feels like Excel. At least the virtual training feels a little hipper, like EveryDollar. Yeah, it's not complicated. If virtual training makes it sound hard, George will not make it too hard to do, I promise. I'm not that smart. He's going to teach you to do exactly what they're doing. Find margin, that's the word they use, in your budget by using the EveryDollar app.

And that's a free budgeting seminar webinar whatever we're going to call the thing and it's tomorrow for most of you listening live that would be the 26th of september and uh you get that at everydollar.com budgeting it's that simple and you're going to be doing it you're going to be teaching them the same stuff that they learned yeah and here's the thing i I was like you guys. I thought budgeting was for Excel nerds and accountants. And I just realized, oh, the point of the budget is to find margin, to spend less, make more, and hit my financial goals, not so that I can be a super nerd and check a box off. And I'm telling you, opening Excel ruins my day to this day. So if you are that person who has never budgeted because you thought it was going to hurt your brain, I'm going to make it so mind-numbingly simple that you have no excuse not to do it. You're going to go, I want that. I'm

going to show you how to go from negative $1,000 a month to positive $1,000, to positive $2,000, to where you go, there's nothing I can't do now with that kind of margin. And that's what they did. That's how they got the house. That's how you pay off the house early, folks. It's that simple. There's no life hack. $94,000 in 33 months. Yeah, that's it. And you got a paid-for stinking house at 36 years old. And you wouldn't have got a paid for house in your early 30s. We started the trend, I guess. But I love seeing folks in their 20s and 30s doing their baby step seven debt-free screams.

Yeah. It's mind-boggling. And this is the week before the student loans start back. So, you know. It feels like Jaws is starting to circle and you hear that. It's coming, people. Make a plan. You even know what that is?

You just referenced a movie that was before you were born. I was trying to connect with you. Oh, you're trying to. Thank you. It's called pandering. Yes. It's not working. Dang it.

Hey, you made a Will Smith reference today, and I was very proud of you. I'm full of surprises. This is The Ramsey Show. George Campbell Ramsey personality is my co-host today. Thank you for joining us, America. Open phones at 888-825-5225. Our question of the day is brought to you by Neighborly, your hub for home services.

They have local service providers to repair, maintain, and improve your home. Their network of experts offers top quality work and customer service by trained, reliable service providers. Find the help you need, good company, good people at neighborly.com. Today's question comes from Andrew in Minnesota. What are your thoughts on balance transfer credit cards? I have three credit card debts I'm paying off in Baby Step 2 and the interest rates are really high. Would it be wise to transfer it to a 0% interest rate card while I am paying them off? The life hack of the balance transfer to the 0% card.

How many have built their wealth, Dave? No, I'm not a fan of these balance transfer cards. And one of many reasons is that it doesn't solve the root problem, you going into debt. Another reason is the 3% to 5% they charge you just to do this, which means if you transfer 10 grand, you're paying an extra 500 bucks for the pleasure of continuing to be in debt with a zero percent offer that will soon run out while you're still in debt and then we're back to square one so while i'm paying off debt can mean a lot of things while i'm paying off debt over 10 or 15 years which means you're not really paying off debt or while i'm paying off debt over 10 or 15 years which means you're not really paying off debt or while i'm paying off debt for one year because i'm gazelle intense and sold everything

but the kids and they're worried you know i mean that's that's two different things of while i'm paying off debt so um while i'm paying off debt over 10 years which means i'm not really doing it then i'm with george don't bother because you're just kidding yourself that you actually did something interest rates aren't your problem the guy in your mirror is your problem you need to quit spending like you're freaking in congress if you're instead doing the other way and you're like gazelle intense you're paying it off in one year then what you're saving is 18 of your balance or 26% of your balance minus whatever transfer fees there are. And so you would save some money. But let's just kind of talk this through for a second.

Let's say net of fees transferred that you saved. I'll make up a number. Let's say it was a 20% and a 5% fee, so net of 15. You save 15 okay if you save 15 for one year on twenty thousand dollars while you're paying it off well you're not really saving it on twenty thousand because during that year you will have reduced it within six months down to ten thousand so your average is not twenty thousand your average is about ten thousand that you're saving the interest on does that make sense okay just doing math nerd here okay so 15 of 10 000 savings is 1500 on a 20 000 balance so is it worth it to say 1500 on a 20 000 balance in one year yes but to george's point does it solve your problem no you have a twenty thousand dollar problem you don't hit it with a fifteen hundred dollar tool you hit it with a twenty thousand dollar tool which is you you be working you

butt off that's the tool yeah okay and you be living on beans and rice rice and beans and don't talk to me about you deserve to go out to eat you'd be a broke person in credit card debt you don't get to go out to eat broke people don't do that crap that's the other piece is you have to actually change your habits you can't just go up i switch to the zero percent we're good now i can keep living my life how i was living and the problem is what i'm trying to point out is the problem is when you make this massive intellectual calorie burning move right to make this transfer and i'm beating them up so genius i've got the billion dollar credit card industry on its back punching it in the nose no you don't okay they are punching you in the nose this is why we're having this discussion so you're not gonna whip their butt

they're the 800 pound gorilla you might take a little chunk out a 1500 chunk out but don't think that that solves the problem it's okay to do it as long as you know that 95 of the problem still stands there and 95 of the solution still stands there and that be you to your point yeah so do the transfer if you want but don't act like don't strut around act like you did something and don't get comfortable because now it's zero percent you're going well it's fine it's not and don't act like don't strut around act like you did something and don't get comfortable because now it's zero percent you're going well it's fine it's not and don't act like you can do this odd infinitum because that's what they're praying for that they can keep haggling you hassling you and punching you in the face and it's time for you to uh just say you know what i don't like the rules of this game i refuse to play anymore i'm taking my toys and going home. I'm getting away from you

people. I'm going to put up a boundary. This is a toxic relationship. Absolutely. What reminds me, Dave, we uploaded this YouTube video on my channel and reacting to this woman who said, hey, velocity banking hack. I paid off my mortgage years early by maxing out my credit cards and writing a check to myself and then switching to the zero percent cards one after another and all of you should do this hack to pay off your mortgage early it's genius and so i broke it down on why velocity banking is a scam but it reminded me of this conversation about these balance transfers so they renamed stupidity velocity you have to give it a cool name to keep it hip because then you know infinite banking you've talked about that i thought velocity means speed meant speed that's

the i didn't know it meant stupidity yes but stupidity banking no one's gonna do they wouldn't sign up for that no oh so we had to give it a different name infinite banking velocity banking oh it's it's stupid fast do stupid fast quickly fast do do stupid quickly. Stupid fast. Quickly fast. Do stupid quickly. You know how to sell things, Dave. You know how that works. Goodness gracious. Like winning a new marketing narrative, boys and girls, yeah. It's just exhausting.

So here's the thing. People jump through. Interest rates in almost, thing to remember, the reason debt consolidation doesn't work in general is that 88% of the people that take out a debt consolidation loan end up going deeper in debt because they don't change the person in their mirror. The problem with this whole thing is it's a pain in the butt because changing you, changing me, me changing me is a pain in the butt. I don't like changing me. I like the old me. I don't, I don't want to have to go through the pain of growth. I don't like it. I don't like the old me. I don't want to have to go through the pain of growth. I don't like it. I don't like the discomfort of transformation. And yet that's what makes a better version of me.

And so changing me is the hook, not changing the technique or the hack. So change the, you know, if you want to shift your balances, that's fine. But you still have 95% of the problem. You've only addressed 5% of the problem. So don't strut around the yard, throwing your shoulders back, acting like you'd be bad. Because you're not. You haven't done anything yet. You just moved it around. The shell still has a P under it. It's just a matter of which one.

The con game on the street. And you're just playing the game. You're getting suckered again. So it's there somewhere. You can count on it until you get rid of the toxic relationship completely by paying the stinking thing completely off it's a big deal it's a big deal so that's the difference in see i grew up in the financial world as a as a in the academic side of things getting all the

licenses and selling all this crap. And we are always taught that the problem is a math problem. And it's just not. When it comes to your personal finance, it's 80% behavior, 20% head knowledge. It's in the psych department. Yeah, wrong department. It's not a math issue. It's a behavior.

If it's a behavior problem, then the solution is a behavior modification solution yeah people think well the problem dave is the 24 interest if i could solve that no the problem is the guy who got your got themselves into 24 interest debt and if we can solve for that we've solved for a whole lot more than just this one little dinky debt oh and let me tell you when you fall for stuff like velocity stupidity banking um when you're desperate or when you're greedy if you want to con someone you need to find people read i read a great book by a con man one time he said if you want to con someone find people that are afraid or that are greedy and if you so if you think that you're the exception to the rule and you've got the hack and you no one knows about it but you

after all this time god selected you to give him this word you've got to be kidding me that's so greedy and stupid and night pride comes right before the fall. You just described most of the cryptocurrency community, and now the NFT community. They're really quiet now. Yeah. They're not making much noise. They've piped down. Where are all you people that said George and I were frauds?

Well, they made their millions. Now they're on the beaches, Dave, apparently. They're not tweeting anymore. That sounds like Velocity Banking to me. They're probably back at work, working their normal jobs. That's Velociraptor banking right there. Ooh. There you go.

That's a whole new banking. I'm signing up for that one. Chomp, chomp. I know what happened to the dinosaurs. I'm not touching that one with a 10-foot pole. I'd take 12, but there you go. This is The Ramsey Show. Hey, George Campbell here. If you love the show and you want a deeper dive on your money journey,

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