The Ramsey Show - App - There's No Price on Your Peace of Mind (Hour 1)

Episode Date: September 1, 2023

🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and have actual amazing relationships. I'm John Deloney, joined by my great friend, Jade Warshaw. And we are taking your calls on money, life, work, your mental and emotional health, your marriage,

whatever you got going on in your life. We may not have a great answer, but we will sit here with you and we will help you figure out the next right step. 888-825-5225. It's 888-825-5225. Let's roll out to the 505 in Albuquerque, New Mexico and talk to Mary. What's up, Mary? Yeah. Hey, it's a pleasure to be part of your program. I have a question for you. Bring it on. I'm so glad that you're with us. What's up? All right. My husband and I applied

for a home mortgage, but we pulled out when we realized the house payment was going to be more than half our monthly income. So now we are traumatized when we think about going into the housing situation, the housing market. We need help. And what should we do? Why are you traumatized? It sounds like you made a really smart move. Well, we did because we figured there's no price on our peace of mind and so we did make a wise move but now we're we're like okay now what yeah because you realize you dodged a bullet you realize what could have almost just happened right you're right wow that's a good way of putting it you know look um what i try to do uh my husband and I have bought two homes together and we've tried to get as much information at the jump as possible. So we're out there researching. We're using all of the mortgage calculators.

So what I would suggest for the next time going in is use a mortgage calculator. And we have a great one. It's how much home can I afford? Right. And you can put in the numbers of the homes that you're finding in your area that you think might be the one. Right. And you can put in the numbers of the homes that you're finding in your area that you think might be the one. Right. And then you're using your income and you're looking at what that monthly payment is going to be. Now, you knew that in this case it was way too much. Right. You knew 50 percent was too much. What we'd want you to get to is a mortgage where the payment is no more than 25% of your take-home pay after taxes. All right. It doesn't have to be after medical insurance and after 401k contribution, that sort of thing. Just your take-home pay after taxes. And of course, we want you on a 15-year fixed rate mortgage. Now,

here's the other thing, because I'll be honest, I don't think we always talk about this enough, John. You need your down payment. You know, We're looking for 5% to 20% of the down payment, but then you also have to think about things like earnest money, closing costs, moving costs. There's so much to consider when you're buying a home. Take your time. That's all I can say. Does that help you at all? Yeah, take your time. How much time, more or less, do you think? 50 to 60 years. Mary, tell me, you seem genuinely rattled. Yeah, I am, because we put down the earnest money, $2,000, and we were excited about it, but we didn't do what I think everything that you're saying, a lot of the research and a lot of the moving costs and the extra costs that we didn't take into consideration. We got emotionally

involved. Yeah. Brand new house and we brand new couple. We just got married and we were ready to move in. And then I woke up one morning. I said, wait a minute, wait a minute. I think you also feel bad because you made the offer and had to rescind it as well. Is there something there? Yeah, we lost the $2,000 in earnest money. Hey, that was the best $2,000 you've ever spent. You got lucky. You got lucky.

I would do exactly what Jay did and said to do and write this stuff down. And probably do it over like a grody, ooey-gooey, newlywed breakfast together on a Saturday morning. And let's be all lovey-dovey and let's be also clear-eyed and say, okay, we already think this is going to cost and this is going to cost and this is going to cost. And then you're going to have to own reality. Here's how much house we can actually buy right now. We had this dream of this house and this is not going to happen, especially not in Albuquerque where prices have gone B-A-N-A-N-A-S. But we're going to find that we can afford this house. Let's just rent for a year. Or we can afford this house. Let's go get our realtor on the trail. And that actual data, that information combined with you leaning in

to your husband, not away from each other right now, because there's this awkward little rift in your marriage right now because he probably wanted to keep on going through it and you said no. It helps heal all of that and it will bring down the temperature inside your chest. Yes. So let's just get real information and real data. By the way, hear both Jade and I say, you not only made the right call, you did what I think is really hard, which is stop a moving train. And most of us are just like, well, I've already had this donut, so my diet is shot for the month. Or I missed this morning's workout, so I guess I'll just work out next year. And you stopped halfway and said, no, no, no, no.

This isn't who I want to be. This is not how I want to start our marriage. So I want you to hear Jade and I applauding applauding you we're super proud of you thank you what you did wasn't a failure what you did was a last second what are we doing and you and you did it you did it and again this is not this was not a no you know i don't want you to think oh man we we messed this up so that means we can't have a house it's just not yet right so you asked john like how long is this process going to take when When are we going to get there? And the answer is when you get there, you'll get there when you get there, when you've got the money saved, when you've got

the research under your belt, when you find the right home that meets the criteria, that's when you're ready. It doesn't have to do with interest rates or, you know, when when the economy says it's a good time to buy, right? The good time to buy is when you are financially ready to buy. And to clear up what may be another question, Mary, my wife and I, we don't live in our dream home. We don't. And our home is awesome. And our marriage is good. And watching my kids smile every day is awesome. And so i think our obsession with um is this perfect is this the forever what about in 10 years are we gonna dude 10 years ago i was

three jobs in two states away from here 10 years is a million years ago sit down and do the data right in front of you and say over the next two to three to five years we think this is what this might look like for us this is awesome take you feel like you've got a lot of pressure on your shoulders. Man, as the great Jay-Z said, just brush your shoulders off. Ooh, get that dirt off your shoulders. Come on, John. Does that make sense, Mary? Yes, totally, totally.

It makes so much sense because it's based on facts and information. And so that's the basis of making good decisions for me. And if you watch the news, most people don't make decisions based on facts. And so you are living in rare air. You've decided to head out on your own. Jade, you have been running the media gauntlet talking to people and running live streams.

You've been meeting with people, talking to media folks. What is the pulse there with living in fact, right? Yeah, I mean, right now, look, John, credit card debt is higher than it's ever been. A trillion dollars. Student loans are coming back. It sounds like you're a kid making a joke. A trillion dollars.

I have to stutter when I say it because it's crazy. Then we've got student loan debt. That's 1.67 trillion, right? Most people's payment is somewhere between $300 to $500. That's just for their, you know, federal student loans. And then you got the car payments. People are starting to default on their car payments. This is catching up to us.

And then on top of that, we're all saying, yeah, but I want to buy a house too. Something's got to give. You've got to live in the reality of your situation and figure out what you've got to do to solve for it, right? You can't keep things as they are

and still get X, Y, Z. You've got to start making changes and doing something different if you want to get something different. With a trillion, with a T. Trillions. Gives me the hemorrhoids. We'll be right back on The Ramsey Show. I'm John Deloney joined by Jade Warshaw. We're taking your calls on money and life and relationships

and your mental, emotional health, your work, whatever you got going on, 888-825-5225. The question of the day is brought to you by Neighborly, your hub for home services. Neighborly.com is the place to find reliable help for your home from locally owned businesses like AirServe, Dryer Vent Wizard, Precision Garage Door Service. God, I need them at my house right now. Window Genie and more for expert help with just about anything you need visit neighborly.com that's right today's

question comes from irene in texas she says hey yeah i like that she says this is probably a long shot in reaching out since i'm sure everyone does but I'm pretty much drowning in debt. As embarrassing as it is to say that I'm handling my credit cards, car and private student loans using your methods as best as I can. But when it comes to federal student loans, my anxiety kicks in, especially now that the payments will restart again. And by the way, interest starts today. I have about 192,000, an astronomical amount in interest as part of that sum in student loans. And I don't know where to get the correct info on how to pay it. I feel like everyone has a different take and it's hard to know what move to make so that I don't add any more to the debt.

Any help on how to move forward with this is greatly appreciated. I just can't afford 2K payments every month, which is probably what they will want me to pay. All right, John, let's let's get comfortable right here because we're going to unpack this. Number one, Irene, you're not alone. That's the first thing I want you to understand here is thank you for this question because you asking this is about to give solutions and answers for a lot of people. So thank you so much for that. 192,000 in federal student loans plus other debt. Obviously, you guys know interest starts today with payments starting in October, whenever your payment is due in October, and she's going to be one of those people. So there's a lot of misinformation out there and it can be confusing.

Okay, Irene. So the first thing I want you to do, and this for anybody listening, you need to find who's got your loan. Okay. Because most of the loan providers that were out there before COVID, they've decided student loan business sucks. We're out. And so your loan has been sold to somebody else. All right. So you need to find who that is, whether it's Moella, whether it's Granite State or whatever that one is called. Great Lakes, all of these different ones. It's no longer Sally Mae. Right. There's all these other service providers. So you need to answer your correspondence. Right. If you're getting letters in the mail, if you're getting emails like don't bury your head in the sand, open that bad boy up and see what's going on.

Call the 1-800 number. And I posted about this on social the other day. Yeah, you might be on hold for a minute. And this might take a couple of lunch breaks to get this thing done. But don't tap out simply because it's taking longer than you hoped. You need to find out what's going on, all right? Next part to that is you're gonna talk to a student loan rep.

And they're gonna act like they know what's best for you. And I'm telling you right now, they are a customer service expert. They are not a finance or money expert. Okay. And I can tell you this, they barely understand what's going on. Okay. So when they start saying, Oh, we could do a, an ICR plan or an IBR plan or a save plan, or then they start saying all these things. They're going to suggest the one that they know the most about, okay? Not what's necessarily best for you. So A1 is I want you to be able to make your payment, okay?

So when you open up that envelope or you log into the screen and you go, oh, $221, I can do that. If you can do it, great, keep it like that. If you look at that payment and you're like, holy crap, if I do that, we don't get to eat, now is the time to start thinking about, okay, how can I make this minimum payment lower? All right.

So that's the only time. If it's keeping you from eating, lower your payment and get a smaller minimum temporarily. Now, in this case with Irene. Hold on. That means some people are going to have to sell their house because they bought a house two or three years ago and they owed $300,000 and they thought that was all going to go away and it didn't. Yeah.

That means some people have to move apartments. What you're saying is not, if you're going to have to adjust your lifestyle a lot, then see if you can lower the payment. No, no, no. Yes. You want the payment as high as you can possibly get it where you can still make that payment. Well, there's a piece to that, John. So if you're working a debt snowball like Ireneirene or like sam and i for instance and you've got a bunch of other debts and your

student loans like it's interesting because her her payments are two thousand dollars my husband and i our student loan payments alone were two thousand dollars we could not make those payments even with a bare bones budget so what we did in the only way, the only, only, only in big red letters, bold underline with lots of exclamation points. Okay. Hear me on this. The only way I would entertain a payment plan to lower my minimum payment is if I'm intensely working a debt snowball, because in the debt snowball, if anybody doesn't understand this, you're listing all of your debts smallest to largest. You're making minimum payments on everything.

And then your extra money, you need extra money to throw out the smallest debt. Now, in the midst of this, you're working extra jobs. You are not going out to eat. You are not having a life because you're paying off your debt. And if that can help you get leverage the same way we say, hey, lower your withholding, you know, so you're not getting a tax return. So you have extra money the same way we say, hey, temporarily pause your 401k contribution to get extra money. All of this stuff, all of this guidance is contingent upon you doing the plan. Because if you're going to lollygag

and you're going to kick rocks and be like, well, I'll do a little here, a little there. Then you pausing your retirement, you're screwing yourself. You doing an IDR plan, you're screwing yourself. You have to do this with the intent of I am paying off my debt and I'm doing this with intensity and intentionality. And it is not simply to kick the can down the road and hope that 20 to 25 years from now, there's some kind of, you know, bucket of forgiveness. So. And am I supposed to just not go out then? Yes. Yes. Am I supposed to just go for hikes with the person I'm dating? Yes. Yes. Hikes. That's all you can afford. That's all you can afford. Because at the end of the day, Irene, when it comes to this, you get on the phone, you talk to this person, they're going to say, hey, why don't you do this plan? Why don't you do that plan?

Or, by the way, here's the newest thing. Twelve month on ramp. Twelve month on ramp says, hey, when payments resume in October, if you're not ready to pay, don't pay. And we'll allow the interest to accrue. Yes, because we're going to get our money. Because, again, federal student loans, they want want your payment they don't want your piece okay so they're going to let that interest accrue but oh how nice of them we just won't tell the credit bureau that you're defaulting so we're just not going to report it and for a year you can go on and let that interest

accrue as though we're doing you a favor that's's like a medical doctor saying, you know what? We're just going to keep taking your blood tests and putting them in a shredder for a year. You eat however you want. Do what you want. Smoke whatever you want. Drink whatever you want. It's all good. We're just going to put your blood test.

You're still going to die. You're still going to die. Still going to die. And let me tell you guys something because I don't think, John, people, I don't think their brain and their heart and their mind will let them accept the fact

that they can be free. You can pay off these student loans. It's not a myth. It's not mythical. What Irene is talking about, I know that situation. My husband and I had 280,000 of student loans. Part of them were federal student loans, a big chunk and a big chunk were private variable interest rates. Okay. Like I said before, one of the loans, a big chunk, and a big chunk were private. Variable interest rates, okay? Like I said before, one of the loans was $192,000 and the payment on it was $900 on that one loan. I'm getting choked up just talking about it because I know how that mess feels. So don't wait around.

You have to be free. I don't care if they tell you the interest is not accruing. If they tell you, well, forgive it after 25 years, your body feels that mess. Your marriage feels that. When she says my anxiety kicks in, it should. It should. That's your body telling you you're not safe because you're not. Because you're not.

And I've lived it too. Me and Sheila, my wife, we've both lived it. Say that again. I think we say peace a lot. And I don't even know that we have a psychology for that anymore yeah walk people through the back end of this like what it actually feels like when there's all this tussling going on in washington and you just you just keep swiping because it doesn't it doesn't apply to you yeah look the goal is to get above the radar right where you're just flying above. You're like an eagle, man.

You're looking and you're going, what's going on down there? Oh, man. Okay. I'm glad I don't have nothing to do with that. That's what it is on the other side of this. On the other side of freedom, you have forgiveness for yourself. For yourself. Because so many of you guys feel like, man, I can't believe I let the government trick me.

I got swindled into this. And it's like, man, was I seriously that dumb? No, you weren't. You made a bad choice. But when you pay off your debt, you get forgiveness and you get peace and you get freedom with your money. That's what this is all about. Not waiting for somebody to be a hero. You're your own hero.

Go get your freedom. Get it, Irene. Go get your peace. Get it, Irene. In the Republic of Texas. Make it happen.. Go get your peace. Get it, Irene. In the Republic of Texas, make it happen. We'll be right back on The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever

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budget at chministries.org slash budget. 888-825-5225. This is The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. We are taking your calls. Let's roll out to D-Town, Dallas, Texas, and talk to Bianca. What's up, Bianca? Hi, thank you so much for taking my call today. Thanks for calling us.

What's up? So, I am a 27 year old. I am about $50,000 in debt. I want to start saving and investing for my future and if things are good, buy a house sometime soon. What should I do?

How do I start planning? I just started listening to your show about two weeks ago. Welcome to our gang. We are a bunch of weirdos. But we're happy to have you part of us. We're glad you joined us. So, hey, Bianca, I love that you have all these goals. I think it's great. I want you to have a house one day. I definitely want you to invest for your future. So I love that you're thinking about this. You're fairly new to the gang, I would say. So I kind of just let's bring it back to the basics and kind of walk through the why of what we do and then talk a little bit about what the

what of what we do and then talk about why we do that. So if you're new, we walk through the series of seven baby steps, right? So the first baby step is getting a thousand bucks saved, right? Most Americans have no money saved. And so as a result, they depend on the credit cards. And so we want to make sure that's not the case. Let's keep a little money aside. And then the second baby step is we're paying off all of our debt, except our home mortgage. And the reason we're doing that is because when you have your income freed up, when you

have your money back and you're no longer making a bunch of payments, then you actually have the money to do things like invest, save for a down payment on a home, that sort of thing. So we're paying off all of our debt and then we're saving up because a thousand dollars, it got us by, but we need more savings than that. Right. So we're saving up three to six months of expenses. And then it's like, all right, everything's set. I've got this nice cushy emergency fund. I can get a house. If something goes wrong with the house, the AC goes out. I've got money to handle it. I'm not having to go on to credit cards. And if the car breaks down, I don't have to get a 401k loan. You know what I'm saying? So we're setting ourself up to be able to have savings, invest, buy a home in the most efficient, safest possible way. Does that make sense? Yeah. So right now, would you not start, would you not begin investing?

I wouldn't. Would you hold off on that? I would hold off on it. And I'll be honest, a lot of people are like, clutch my pearls. She told me not to invest. It's only temporary. That's the oldest thing I've ever off on it. And I'll be honest, a lot of people are like, clutch my pearls. She told me not to invest. It's only temporary. That's the oldest thing I've ever heard somebody say.

What, clutch my pearls? Yeah. I'm an old soul. You're really- I'm from the old school. Really old soul. I know. So yeah, it's temporary.

Just remember, it's temporary. We're doing this all with intensity. We're doing it quickly. And John will tell you, most people who walk through this path, Bianca, it's temporary. We're doing this all with intensity. We're doing it quickly. And John will tell you, most people who walk through this path, Bianca, they're done. 12, 24, 36 months. They're finished with their debt.

What's your income, by the way? So I currently make 105, 105,000. Now wait, is it just you? Just me. Hey, hey, hey, hey. Bianca crushing it. I'm excited because if you live on $55,000 this year you're debt-free this year I'm trying to um so just uh as soon as I started listening to you guys I cut out all of my subscriptions and um I mean I'm trying to limit myself to really

save up as much as I can just because I feel like I've fallen behind I feel like I'm trying to limit myself to really save up as much as I can. Just because I feel like I've fallen behind. I feel like I should have a lot more saved. I feel like I should just have a lot more. And so I'm trying to catch up. A very common thing we hear is, I realized I make way too much money to be this broke. Yeah. And you're a single 27, 28-year-old making six figures. Yeah.

So think of it this way. All the things that you laid out, I want to pay this debt off. I want to start investing. I want to buy a house. Jade and I 100% want that for you. We just know after millions of people have walked alongside us over the years, there's an order to it. And if you do it out of order, then things get sideways.

Your air conditioner will break. Your transmission will fall out of your car. COVID will happen. And your five real estate properties that you've leveraged will not have to pay rent. Whatever comes up. How much cash do you have?

So I have about 10,000, 15,000 saved. Excellent. You are going to be so puckered up when we tell you to send 14,000 of that to this debt and you're instantly down to what, 36,000? Yeah. And you'll have 1,000 bucks. And listen, you're going to feel so angsty and that's the point. We want you to not feel like you can sit down until you are debt-free because you're not safe.

You make six figures and you're still not safe. You are one wrong laugh at the wrong joke at work and your boss tells you to leave. Then you lose your house and your car and your food. See what I'm saying? Your body's doing its job by not letting you feel comfortable when you owe this kind of money. Okay. So go down a thousand bucks, dump 14 grand of that 15 towards your debt today,

knock off some of those credit cards in order of at least, you might consider selling your car and buying a Camry to get around Dallas in. Whatever you got to do, and you're going to find real fast that you scratch and claw and scratch and claw. You're not going to owe anybody anything.

Then you save up that emergency fund where you're your own bank and then you're off to the races. Yeah. Bianca, when you're 30, you're going to have a house and you're going to be investing and you're going to have been in that rhythm for a while and you're going to look back on this and go, oh my God, I'm so glad that I started the day that they told me to start. I'm excited. Does that make sense? It does. Yeah. All right. You guys so much. No, thank you so much. Hey, and keep us, um, keep us apprised of your journey. Let us know how it goes. The good stuff, the bad stuff, the hard stuff. But, um, I love hearing these, the, the, the steps along the way. I know the death free screams are the end, but I love hearing these things along the way. Let's run out to John in Jacksonville. What's up, John? Hey, guys. What's going on?

Thanks for taking the call. We are partying, man. What's up? Hey, so I got a quick question. I'll try to give you the short version of our long story, but we basically have $80,000 in savings that we're trying to save for our next home, a larger home in a nicer community. But we have two vehicles with a total debt of 62,000 on those. John! So I kind of know what was coming when I took this call. I wanted to reach out to you guys. My wife's hiding in the other room.

She should be hiding. What's your income, John? So we're fortunate enough where she's staying home with our new son. Okay. The income for me is about $150 a year. Okay. So that's where we're sitting with that. We had a long story with our son getting him home from the hospital when he was born.

But needless to say, we were just thinking that we obviously know what we need to do with this money. Instead of saving it and using it for our next step, we just really wanted to make sure, talking to you all, that we know the only debt we have is the cars. Here's the question I would challenge you on. Are those cars in your driveway? And by the way, I remember the car that I drove my daughter home from the

hospital in. It was an old Prius, and I remember it only because it had a crazy ice storm, and I didn't think we were going to make it. I do not remember the car I drove my son home in. I have no recollection of that car. So the question I would have you and your wife ask each other is, are these two cars worth not having a home?

Because I do remember the homes we brought our kids home. Right. And I know you make $150,000, but if you make $150,000 and your wife loves you, who cares if you're driving an old Corolla? Well, let me hit them with another side. Me and John are going to give you two opposing views how about that ramsey first all right so john is saying hey if you want a house you got 62 in car debt pay those jokers

you know sell those jokers and you know you have the money i'm looking at this number and i'm going okay 150 yet you know you got 62,000 in cars. That's probably 30 something each for each of your cars. They probably are about worth what you owe on them. Is that, is that right? Like you're not upside down. Are you upside down on either of them? No, no. So my thought is like, if you love the cars, it's not more than half of your, you know, annual income. If you love the cars it's not more than half of your you know annual income

if you love the cars you could keep them but the sacrifice would be it's going to take you longer to get your home so you have to just decide what do you value most that's what jay that's what i would say neither is wrong that's what that's why i love the question yeah i just try to think of my son who's five saying daddy why don't we have a house and me saying because we need a camera i had this rad truck that made me feel tough and he'd go but daddy can i have a room so that's just how i look at it but also i'm not a car guy so teach his own but yeah there's not a wrong path here um but make it happen. Quick, John. We'll be right back. 888-825-5225 This is the Ramsey Show.

If you are new to this gang of weirdos who has decided to take both pills and get out of the matrix and stop letting banks and credit card companies and car dealerships run our lives. If you want to dive deeper into the Ramsey baby steps and figure out what in the world we're even talking about, go to ramsesolutions.com and click on the Get Started button.

We'll help you figure out the next best step for your financial journey based exactly where you are right now. I know it's easy to listen to folks and be like, yeah, but what about the... We got you. Go to ramseysolutions.com and click on Get Started and we'll get you hooked up. All right, let's go out to Denver, Colorado,

where it's all legal and talk to Kaylee. What's up, Kaylee? What's up? That's for sure. Hi, thank you both for taking my call today. You bet. How we doing? Very good., thank you both for taking my call today. You bet. How are we doing? Very good.

I hope you both are the same. I'm calling because I am wondering if we should make interest-free monthly payments on a home repair or use our emergency fund to partially pay it off. We are in baby step three. We have about $5,300 saved up, but our actual fully funded emergency fund is around $10,000. But we had a swamp cooler go out, and it actually was $9,000 to get repaired. And the company set us up with interest-free payments, but now I'm not sure, do I just roll this back into like it's debt or do we continue to put into our emergency fund and still just make the monthly payments

without any interest? Let me make sure I understand. You had 10,000 in your fully funded emergency? No, no. We're on Baby Step 3 working towards the goal of 10,000. Okay, oh, okay. So you've got 53.

You've only got 53 at this point. Yes, exactly. Got it. And how much is it going to cost to get the repair in total? Well, we had to get it done because we had been putting it off for several years, but it finally started gushing water into our basement. And so we've already got it. Payments start this month. Okay.

So there's no going back. You've already gotten into this. And how okay so there's no going back you've already gotten into this and how much what's the amount we had to do it it was starting to ruin our house our our walls all of it shoot what was the amount nine thousand nine thousand oh lordy okay um i you're in it now so yeah you got to treat it like that you got to pay it off um okay and you're in it now. So yeah, you got to treat it like debt. You got to pay it off. Um, and you're back, you're essentially back in baby step one. Um, and that sucks, but it does. And, you know, you called in, so I gotta, I gotta whoop you a little bit because I'm like, no, whenever stuff like this comes, guys, uh, we got to take debt off the table we've got to yeah yeah take it off the

table we did have it coded last year for and they it was only $3,500 last year like oh okay great so we'll save up to that and so we finally hit the bull and I go let's get them out here to fix it and it ended up being way more than that did you get more than one more than one um personal look at it we did that was like middle of the road what do you think john um here here's i i think this is a make or break for you guys and i'm not saying that being over dramatic but y'all had this big moment we're gonna get out of debt we're gonna go through I think this is a make or break for you guys. And I'm not saying that being over dramatic, but y'all had this big moment. We're going to get out of debt.

We're going to go through these baby steps. And then you had the, you got hit in the mouth the first time. And it was, you got hit hard. And, um, y'all are going to be dealing with both the fact that you owe $4,700 more than

you got. And that y'all made an agreement together. And for whatever reason, we had to, had to, whatever, we did it. And so this is one of those make or break moments for this journey. And I've just sat with enough people to tell you the first big rattle out of the bag, the guy who, you know, I'm never eating sugar again, and then he finds himself with his grandma's cookies headed towards his mouth. This is a moment, right?

So if I'm you, and I am, you're married, right? Yes. Okay. Is your spouse on board? Yes, yeah. Okay, so no. That's no.

It's been a long process. To be honest, this has been a long process. We've, that's no, not even a long process. To be honest, this has been a long process. We've got hit in the mouth actually quite a few times. This is probably maybe like our second or third time getting to the fully funded emergency fund. And then we had to go back. Yeah. So, okay. But hold on, hold on. But you don't have to think for him. It's like, it's like, yeah, we got there and then something comes up and then it's like, okay,

we have to get back on this again. Okay. But hold on. This is what it's for. Cause think about if you didn't have the emergency fund, that's right. You'd have $30,000 in credit card debt right now. So people get frustrated. I just filled it up and then this thing happens and I just filled it up. This thing happens and I just want to scream. Yes, it's exactly what it's for frustrating. And it won't keep happening unless you are like Tom Hanks in the money pit. Like it won't keep happening. But thank God.

Thank God you've been doing this work so that every time it shows up, you've got a plan. I would treat this like I would lock arms with my spouse. And I would treat this outstanding $4,700 like it's on fire. Yeah. Okay. Let's do 90 days. We Uber on the way to work. We Uber on the way home from work. We work on Saturdays. We work on Sundays. Let's go B-A-N-A-N-A-S. Get this out. Yeah. Because I'm definitely feeling it. Like being so many times we're like, okay, done with that we're done with that and then this pops up and i'm like oh that's that's i want you to fully digest that this is not just a math problem here this is a we made an agreement and we went backwards and so there's going to be a shame component to that kick that in the teeth

by y'all making a berserker attack on this 4,700 bucks. We did it. I'm not going to rely on some HVAC company to float my family. We're going to knock this thing out quick. Okay. See what I'm saying? Yeah. I thought that was going to be the answer, and I just, like I said,

it's frustrating to go back and go back and go back. It is. But hear us say, thank God, thank God, thank God. I don't want it hanging over our head. You haven't gone back. You've stayed above water. Okay. You would be at the bottom of the ocean

if you had not had these emergency funds over and over again. Yeah, yeah, for sure, for sure. So thank you. Thank you for that confidence booster. You know, it's interesting. When people set out to walk the baby steps, they set out to pay off their debt. You are it's it's countercultural, right? It's people use credit cards and they use debt and they go on zero, you know, payments with no interest interest for however many months. And that's what people do. But when you say, I'm not going to live my life like that. I'm going to give myself credit that we can live on what we make

and we can use cash and we don't need credit. You meet resistance. Like that's just part of it. You can't avoid it. And so I like what John said, like you're going to encounter emergencies. You're going to have resistance. You're going to have things that are going to try to knock you off course. Those shouldn't be a signal of, oh, I must be doing something wrong. I'm making a mistake. It's not working. That's actually a signal that you're doing right. Because you don't just run to the credit card. That's, you know, break it out of the block of ice, right? In the freezer. You didn't just run, you know what I'm saying? That is a signal that, okay, you're doing things different because you have to start digging deep to find solutions do we need to sell the couch do I need to sell

the lawnmower what do I need to do to get this money so that I'm not going back to debt I'm gonna win and debt is always gonna try to wrestle you to the mat and get you to tap out but you've gotta you gotta do you know an old high school wrestling move and get back on top and not let debt cause you to tap. Okay? This is it. Thank you. And let me give you, like, you just nailed it. I want to make sure people get the level here.

My little brother sold his dream, dream, dream five-string Music Man Stingray custom bass that he had built so him and his wife could get out of debt i remember when my wife and i were going and i got rid of my all my martin acoustics i got rid i sold them because because freedom was more important than stuff i drove a 1993 ford f-150 as the dean of students at a law school and my colleagues would laugh because it was embarrassing right it was a tough truck to sweat and you guys didn't have a mattress for eight years, right? We sold our bath mats at one point. On Facebook Marketplace, somebody paid $6 for our bath mats. Right.

So I want you to hear us. That's the intensity of the people you're talking to. You can find a friend right now that would tell you, oh, it doesn't matter. If you want to listen to that friend, knock your lights out. But you called us, and we're going to tell you the truth. Get this out of your life. Get out of your life. Get out of your life.

You are winning even when you feel like you're not. You are. Hey, that's the first hour in the books. Thank you so much to the guys in the booth, even Will. We're grateful, Will and Skylar. There she is. Thank you, America. We're grateful. And Skylar, there she is. Thank you, America. We'll be right back on The Ramsey Show.

Hey, it's Dr. John Deloney. If you love the show and want a deeper dive on your money journey, we have a weekly newsletter that gives you trending and helpful articles and tips on following the Ramsey way. Just go to ramseysolutions.com today to sign up for our newsletter.

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