The Ramsey Show - App - These Bad Decisions Will Steal Your Wealth (Hour 1)

Episode Date: April 4, 2024

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. I'm Dave Ramsey, your host. My co-host today is Rachel Cruz, number one best selling author, co-host of Smart Money Happy Hour, and author also of a brand new, our second best-selling book of hers on the kids list. It comes out April 16th, and it's up for sale right now. And we have been test marketing it among the grandkids, and it's working. I'm glad for where I am. The first one was I'm glad for what I have, and so her new book coming out soon.

So she's going to be helping me with your questions today. The phone number is 888-825-5225. Micah is with us to start off this hour. He's in Huntsville. Hey, Micah, welcome to the Ramsey Show. Hi, Dave. Thanks for taking my call. Sure.

What's up? Okay, so I just started the Baby Steps last month, and I have $1,000 in the emergency fund already. It's getting springtime, and my yards are getting pretty high. I'm needing a lawnmower, and I don't currently have the cash to pay for one, but I got like $2,000 that I could put down on, not finance, but just buy a cheap one.

Or I could hire somebody to cut my grass for the summer while I save to buy a nicer lawnmower because I live on like 10 acres, which I'm not going to keep 10 acres cut, but just wondering your thoughts on what I should do on that. Okay, so how much do you actually keep cut? About four or five. Okay, and how have you been doing it before now?

Well, we just built the house last year, and so I really haven't had a yard. Oh, okay. After all the dozer work was done, it was just kind of like a mud hole. Yeah. So we're planting grass, though, and I try to keep about four or five acres cut. Okay. So it's not been cut prior to now, or if it was, somebody else did it, right? Correct.

It was a 10-acre pasture, and it was bush hogged up until the time we built. Mm-hmm. Okay. All right. How much debt do you have, Micah? Currently, we have just the mortgage, and then we also have a car payment. The car is about $28,000, and we're on track to pay it off by the end of the year. What's your household income?

After taxes, about $90,000. Okay. All right. Well, you know, the thing on something like this, the beautiful thing about you calling is you're actually thinking about it. Because at this time last year, if you were facing the same thing, you would have gone and financed an $8,000 stupid tractor of some kind, right, that you couldn't afford. My dad listened to y'all while I was growing up. So, I mean, the only stupid decision I ever made was to buy the car and finance it. And the only reason I did it was my wife and I, we both had pay-for-vehicles, but we was out growing the car that we was in with a family vehicle.

And you used that as an excuse to buy something you couldn't afford. Yeah. Okay. Yeah, pretty much. Yeah. All right. Okay. And the, okay, so it's a you know it's

a math thing if uh your your goal is to pay off the car the more we spend on the lawn through service or tractor purchase either one the shorter i mean the longer the car debt's going to hang around obviously so if you put every thousand you put towards this issue of lawn is a thousand not going towards reducing the car. So obviously what you're asking is what's the least way we can do this. I don't know. I guess get a bid from somebody on what it'll take to mow it and then compare that to what you could buy a used riding lawnmower on Facebook Marketplace for. Well, I mean, if I drop $2,500 on a lawnmower, I facebook marketplace for well i mean if i if i drop 2500 on a lawnmower i could i could do that next month but it would just push the yeah it pushes it out 2500 but are you

going what are you going to spend to cut the thing all summer if you pay somebody else to do it probably more than 2500 i would guess right right yes sir yeah so i mean the cheapest way to do it is to buy a the leastriced used lawnmower that will get you through the summer. Okay. That's the cheapest way to do it. I had one more question, if you don't mind. Sure.

We've been starting our budget, our every-dollar budget. We started that this month. And the miscellaneous category is kind of tough for me to figure out how much to put in miscellaneous each month just because that fluctuates a pretty good bit. We've got two kids under two. I mean, they can get sick at the drop of a hat, or they might go a couple months without getting sick. There's expenses that we don't plan for sometimes that occur during the month, and we just don't want to kill our budget by not planning enough.

Yeah, I would probably up it at the beginning. And then once you guys have done this, like three or four months, there's usually a consistent, or how it worked in our house, that consistent thing that keeps coming every month that we throw in the miscellaneous that we end up just making a budget line item for. Yeah, like if kids are going to the doctor every three months or two months, then that's a budget line item for um yeah like if kids are going to the doctor every three months or two months then that's a budget line item yes sir i mean and if you got two under two it's like a rule you have to pay the pediatrician's borscht payment i mean oh my gosh you know it's like you have to

go over there it's federal law right and so the kids are going to do that when they're little bitties they do that they are yeah and so you're going gonna have some you know so it's really not a surprise it really wouldn't shock you and and right to rachel's point if it reoccurs then you just make a line item for it and put an amount in that say kids medical okay and every dollar and then you lower whatever you put in there you lower your miscellaneous by that yeah but and i would say to micah into anyone listening that is budgeting for the first time that miscellaneous category i would make it higher than what you think you need because there's going to be expenses in your life that you don't even realize because you haven't been budgeting. Right. And so you're going to go through a few months of it to be able to say, oh, my gosh, OK, that's the thing that keeps coming up.

Or, oh, we got this. We got this way more under control. And so we can actually lower the miscellaneous so i would be more conservative more liberal conservative higher higher amount on the uh miscellaneous category for now micah especially it's not political more liberal i know i was like it's more like here you're not a liberal it's just more money you never know you never know okay thank you yes yeah so how much is a lawnmower, though, for real? No, I mean, you can buy a push mower right now, a used push mower, all day long on Facebook Marketplace for $50. But five acres, that's like 73 days you'll be cutting out there.

But how much is like a zero turn? I don't know. Do you like that price? Look at that. Look at that. So probably a couple grand. Oh, five grand? You can pick it up for two.

I used one. But it's not one you want. It's one to get the grass cut with. Yeah. So it won't bake bread and it won't catch fish while you're mowing. And some of them will. So some of them will do it with GPS. We're just we're trying to basically cut the grass.

That's all. And I wonder in Huntsville, what I was thinking, I was like, some kid this summer is going to be doing this for their job. I know, but $2,000

for the whole summer for five acres? I doubt it. Yeah. I doubt it. I might be wrong. That seems like a lot. I don't know.

Okay. $2,000? That's the analysis. I want to go back to the other thing because when you first start budgeting... What, that I'm a liberal? No, no, no. We're not worried about that because you'll just get thrown out of the analysis. I want to go back to the other thing because when you first start budgeting. That I'm a liberal? No, no, no.

We're not worried about that because you'll just get thrown out of the family. Oh my gosh! We don't have to fire you. You would have. But anyway. I'm here for all people. Yes, we love all people. I'm here for all people.

But we aren't all people. I'm here. We love them, but that doesn't mean we want to be them. Okay, so the... It's going downhill. Anyway, anyway. I'm a conspiracy theorist. I know.

I'll just own that label. That one you can have. That one's legal. Okay. So the miscellaneous... It takes 90 days of doing your budget for your budget to start to work. And part of it is the things you don't expect to come when you first start doing this, like kids medical or activity fees at school or so on. So give yourself some grace to lean into that over the first 90 days. This is 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 to get anything approved through the bureaucracy. So if you feel like the system is working against you, try a biblically-based alternative to health insurance, Christian Healthcare Ministries. CHM is a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of over $11 billion in medical bills since 1981. And CHM has also helped them stay true to their values and avoid miles of red tape. And CHM support goes far beyond meeting financial needs. They'll also help meet spiritual needs. Members become part of

a family who will pray with them and for them when they experience a medical event. So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget at chministries.org slash budget. Rachel Cruz, Ramsey Personality, number one best-selling author. My daughter is my co-host today. Melody's in Atlanta. Hi, Melody. How are you? I'm good. How are you? Better than we deserve. How can we help? So we are within two weeks, in theory, of having our firstborn and trying to figure out. Yay! What are you having?

I'm so excited. Little boy. All right. Very fun. Congratulations. Thank you. Just trying to figure out best options for investments moving forward past just like work 401ks and what we can kind of do as a little extra to have him set up. Okay. Is this for your son you're thinking

for specifically or you guys as a family or like as a couple? As a family. Okay. Are you guys... He'll have to work when the time comes. Yes, yes, yes, yes. Are you guys working your way out of debt, or are you out now? No, we are out of debt. We finished paying off our house two weeks ago. Oh, way to go. Oh, my gosh. You're 100% debt free.

Yes, sir. Way to go. So you guys are... Both cars are paid for. One was the one I had when we got married. The other one we paid cash for a little over about two years ago, I guess. Gosh, that's so impressive. How much do you guys make a year?

It fluctuates. My husband works very, very hard. It ranges. He has a salary, but then he has like on the road per diem. And then he has like premium time he can make as well so so how much do you make a year um salary is just a little over 100 and then his take home last year was a little over two okay that's excellent way to go awesome um yeah i mean i would stick with match maxing out what you can and maxing out uh you guys will be beyond the roth i think you i think it's you can do a roth backdoor now i'm

gonna do a roth i mean if he's under 200 agi so probably somewhere around there you can do a backdoor or regular you need to be maxing out both roths you need to be maxing out 401ks hopefully in a roth with a match uh and you max out your 529 for the kiddo um and or you don't have to max it out but put five you know six or eight ten grand in there a year and uh if you do that he's going to go to college anywhere he wants to go if you do that he's going to go to college anywhere he wants to go and if you put all you can put in 401ks and roths how old are you guys um he's 32 i'm 30 okay that alone at 65 will have you between five and ten million dollars just doing that okay you said both roths um yeah

so you can you can have one a spousal spousal even though you don't work you can have one espousal, even though you don't work. You can open one, Melody, under your name. All right, so we have 401K with his work. Yes. And then that's what I will use. Is it the Roth IRA, like the personal one? Yes. I've been trying to do some research on that, but I got a little confused. Yes, you can do a Roth IRA each, $6,000, and he can max out his 401K.

If he has a Roth option on the the 401k it should be doing that okay okay perfect and then so what you need to do is jump on ramsey solutions.com and click on smart vestor and find a smart vestor pro in your area these are the mutual fund brokers that we recommend and you can find one that that they have the heart of a teacher or we don't put them on there. So they're going to sit down and teach you what is best and what these numbers will turn into. So you're going to be very, very wealthy if you just do that.

Now, once you've maxed out all of that stuff, you're at what we call baby step seven, no debt at all. There's nothing left to do but become extremely wealthy and be wildly generous. That's it. That's all you've got left to do. And enjoy some money in the process um but the um so you know beyond that then you start talking about okay am i going to do more mutual fund investing or am i going to pay cash for some

rental real estate if you want to be in that world uh that kind of thing those are the two things i have done beyond maxing out everything. But your first step is get the 529 started for Kiddo. Once he's got a social security number, he's arrived, then you can do that and do that in a month or two here. And you guys max out the 401 with the match and max out both Roths. That's a really good start. And again, if that's all you ever do for the next 30 years,

it's going to be millions and millions and millions of dollars. So you're going to be in great shape. But why not even do more? And why not enjoy more? And why not be even more generous? So sit down with a smart investor pro, and they'll help you do all that. Yeah. And for kids, because I've talked to a lot of families who are like okay if

we max everything out what investment options besides just education can i do for my kids you don't and well they're up my accounts there's i mean there's other you can't but i wouldn't i would just build it in your build the wealth in your name and then leave it to them as a part of the estate when they when the parent dies though that's that's well or you could you could if you want to hand them some money yeah yeah that's what i was saying you could hand them money at death or you could hand them money early yeah there's no point in putting it in their name yeah there's no you know because you don't have it you lose control and you lose options so when you build wealth you're building wealth for your whole family your family's going to get the use of the wealth so there's no point in putting in the kid's name

because i mean the kid may decide that they're you know they may have all kinds of problems or something you know they can get to yeah and get to it they own it but not my what 18 though 21 on the hut but yeah uniform transfer to minors act is when you open an account in the child's name utma and put your name on it as the custodian but you do not have control of it so he's doing heroin at 21 he's got a million dollars not this kid but another kid the kid's doing a million he's got a million dollars you just killed your kid because you're going to access that and they're going to overdose on heroin so you have to control it no i mean it's so dramatic no but this is what happens i mean i've been doing this 30 years i know but i'm just saying though for family okay because because say

you're like okay you know you think about melody they freaking have everything paid off i know i'm going i'm going down a road so follow me i'll try uh everything paid off there they have a baby born in a month so in 18 years say melody and her husband are like yeah we'll help with like the down payment on the home because he's not doing heroin and he's awesome he's has a job he's paying taxes he's responsible yeah he's a great kid he's a great kid this one this one this one's gonna turn out and it's like great we we have melody and husband so much money and we want to help our kids continue that legacy. So we want to say, hey, here's a down payment for a home, or here's something that is not college-related.

Isn't there a gift tax? Doesn't that get into taxes? You can avoid gift tax with Uniform Transfer to Minors Act. Which is a, uh, ma. No. What? I'm sorry, Unified Estate Tax Credit. I picked up the wrong uni.

Unified estate tax credit. And you can avoid it and move money anytime you need to. And of course, the other thing is this. You can, okay, gift tax this year is what? I don't know, 15,000 bucks or whatever. Something like that. And so let's say that if you want to give your grown kids some money i need to look james find the gift tax and tell me what it is but the uh because i can't remember nothing oh it's right here it's on

my notebook oh hello i got this cheat sheet i should use all right because i well they change it they up it for inflation every year uh 17 000 okay so if a married couple yes has a grown married child in their 20s yes there's four players involved yep mom can give daughter-in-law and son 17 each two checks okay dad can give daughter-in-law and son 17 each in so it's 60,000 yeah yeah okay and um so that that's 64 four thousand dollars yeah or sixty eight thousand dollars okay uh in one year if you happen to do it at christmas you do it again three weeks later and you got 128 000 okay right okay and so um you know you can get to just about anywhere you want to get to just using that without even using the unified estate tax credit which means you're using up some of your estate uh exemptions in the federal by using it against gift tax so you can get your money to

your kids yeah while you're alive because that's part of all of this you guys is is changing your family tree and we talk about that yes that is that is knowledge that's character like there's so much there but also i think about the reality of so many people listening now that are so young and if they start doing this they're gonna look so much money they have so much money in 20 years and part of changing that family tree is what does this look like you know all three of you all three of you turned out so far okay and so so far right and so you can use none of you none of you had none of you had big accounts in your names except that your college funds were UTMAs because there was not a 529 back then.

And we handed your UTMA to you. That was your old college fund because we'd cash flowed the college. And you guys used that for your first houses and stuff. And that got you going on your wealth stuff. But you didn't have a million dollars in your name when you graduated from college. No, no. But I did. I had a million dollars in my name, and then I could do stuff with it if I wanted to. I hear you. I hear you. So, Rachel Cruz, my co-host today and daughter, has a brand new book out. Comes out April 16th. We're in pre-sale right now i'm glad for where i am a new children's book it's all about gratitude the first one was about contentment if you will teach

your kiddos gratitude and contentment uh you set them on a real wonderful psychological path the health of their psychology the health of their emotions, the health of their emotions, a wonderful spiritual path. And those two things will lead them to an ability to build wealth because people who are grateful and people who are content have a very high tendency to win with money and life for that matter. So that's what this is all about. There's not just a little kid's book. There's a game here that we're playing that's a long ball. So this comes out. Now, you're going to be doing signings in several cities. Are we announcing that yet?

I am. I don't have all the details, but signings will be in L.A., Dallas, Phoenix, and Atlanta. So story time. Yeah, so I'm going to do a story time. Yeah, local Barnes & Nobles, but we'll get you the exact addresses and times. They're probably around 1 o'clock signings in those cities. It's coming up in two weeks. So I'm excited.

And Ken Coleman's new book that comes from the Get Clear Assessment of his, almost 100,000 folks have taken the Get Clear Assessment. You can get it on our website. But we're putting a book companion piece with it called Find the Work You're Wired to Do that explains the results of and includes the Get Clear Assessment. So you'll get a code that explains the results of and includes the get clear assessment. So you'll get a code to take the assessment, and then this will walk you through what you're learning about yourself to get plugged into the proper career that's not only fulfilling, but it turns out when you love what you do and when you're good at it and you're fulfilling

and you're fulfilled at it, you will make the most you've ever made in your life, which is part of the goal here. And so very few people maximize their income doing something they hate and that they suck at. Very few. That's just highly unusual. But that book is also in presale. It comes out technically, and we'll ship it to you first week of May.

And so all of those are on sale, and that's what's happening around here right now. All right. Rachel is with us in Salt Lake City. Hi, Rachel. Welcome to the Ramsey Show. Hi. Hi there. How are you?

Good. How can we help? Yes, I'm extremely nervous to talk to you. I've been following you for the last four months really heavily after having a sister um non-stop in my ear about Dave listen anyone with an accent as cool as yours should not be nervous to talk to us so I know so is it is it British or Australian what am I missing it's British British you're right so where are you from in the UK uh from from Paul from Dorset oh wow originally but we're actually emigrated two years ago um and i'm going

to try and make this it seems like a easy question but it's complicated so i'm going to try and not ramble um we emigrated two years ago because we couldn't do in the uk what we wanted to do here which was buy land build my husband has been in construction for 15 years and it's really good at it we raised all the capital we came here and within a month of moving here I was diagnosed with stage 3 cancer and all of our money went to keeping me alive. Plus

about $36,000 worth of credit card debt. I'm calling that a good investment. Yeah. Right, but still so we're not massively in debt. We've got $36,000 of credit card debt. But long story short, my husband, on top of that, his dad passed away very suddenly.

He was healthy and passed very suddenly last year. And we're about to receive roughly about what we've spent on keeping the alive um back in inheritance from his father's estate and we are in my husband is sitting next to me he didn't want to be on speaker because he has an accent too and he didn't think he'd hear him properly um but we we're just uh in a place where we're following his steps and we know we should pay the debt off but we're we're in disagreement with what that money should do um because he knows he can take that and he can change our lives within eight to ten months by investing what his dad's inheritance will bring and put us straight into um out clear with six months in the bank savings you know out of debt yeah how much how much money

is this it's 120 but lands only about 28 here, and he can knock it up real quick. So it's, and we can sell it for $350,000. So the numbers work. He's not just, it's not a pipe dream. We've done the numbers. We came out with a business plan. We do know what we're doing. So you're going to build something for $128,000 that you can sell for $350,000?

That's correct. That's correct. Okay. Obviously, less fees. There's going to be fees. But then what the plan is to reinvest it and then go to a piece of land that he can do for on and, you know, to grow from that. That was what we came here to do because we couldn't do that.

Normal builder margins in the United States of America are nowhere near that. These are numbers I've never seen before, and I do a lot of real estate. I understand. We have run the numbers. We've got an estate agent. We've looked at the market. I mean, 350 is on the higher side. The worst case scenario is going to three 300 um and my husband's doing

the work himself so he's he's not having to obviously like i said he's been in construction for for 15 years um so he knows how to do ground up he does everything um and it's qualified just in about just about everything you can imagine so we're doing this um where my you know we've not got a whole lot of labor cost because my husband is doing this while i'm i'm working um and keeping our bills paid through my job a guy building a house completely by himself he'll have help but it's just not going to cost a lot because if their labor is because he knows what he's doing rich do you guys have any other savings do you guys have any other savings um we we don't like i said well we've got the thousand we've got the emergency fund we started our debt snowball um as. So we're into our debt snowball. But like I said, it's,

we're arguing back and forth because I want to clear the debt and then wait. And he's saying it's going to take, he worries if I relapse or anything else goes wrong, we'll never get this opportunity again. He's, he's, he's worried that if we don't do this now. Yeah. So here's what makes me nervous about it, Rachel, because I mean, I trust you guys. You've run the numbers. You know what you're doing. It's not a question of that. But whenever you make a decision that is so single-focused and the language you're using or the language that he's using that you're telling us, it is this urgency. It's this, if I don't do this now, it's never going to happen again. And you can plug in that, Rachel, that scenario, that language with kids going to college. I got

accepted to this college. If I don't go this fall, then this, this, and this isn't going to happen. Or someone buying a house and they'll tell us, it's the only house. This is the only house we can do. It's our only option. And when you start to do that, Rachel, you start to lose the ability to make decisions because you don't have options. And so what I would say is I would slow down. I really believe you guys know what you're doing. He's very talented. He's really good at what he does. But that's the business side of his world. But what we're talking about here is your personal home and your personal debt and where you guys are, and this inheritance is coming in. And so I would clear it because the urgency of the other option as well,

usually people don't make great decisions when you're in that position. Does that make sense? Yeah, this is a fatalistic language. What do you make? We make about $110,000 between us and you. Okay. So why can you not pay off $110,000 between us a year. Okay. So why can you not pay off $36,000 in 12 months? Because we're paying...

You're going to hate me, Dave. Don't make me tell you. We have our kids in private. We have two children in Christian private school, and that takes quite a lot. We try public school, and my daughter has autism, and my son has gastroparesis, and the state just wouldn't work with us around that,

so we moved them into private school. What do you do for a living? I am a piano and voice teacher, and my husband obviously owns a construction company. And he's doing construction now. Yes, he is. So he's working for us. He takes, you know, picks up projects and is working, wants to be working for himself.

This is what we came to do. So, you know, we've had to go back and... Listen, as mom, all the health stuff that you guys have been through. And then as you just explained with your two kids, I'm like, I would not want risk. I would want everything paid and I want a pile of money in the bank because the amount of situations that can come up for you guys so is a lot so the answer the question is no i would not build i would not build the house that's what i said i would not build the house i would pay off the debt and i would go if i'm your husband i'm going to start doing renovations and rehabs for other people, self-employed, because he has the ability to do this.

He can make a lot more money than he's making now and build that business and build some cash base back up and then go do this other deal. Because I've got to tell you, I've been doing this a long time, and I know a lot about building. I'm building a house right now, and the numbers you're giving me, they don't work. I know you like them and you believe in them but that's the other problem a couple of circle backs before i get 9 000 comments about how dumb i am with taxes um because i am and that would be accurate but there's no reason to make it worse. So the gift tax is not $17,000.

Even my cheat sheet that was in front of me because my brain doesn't remember all these things was wrong. And so it's actually $18,024. So an individual can give an individual $18,000 without any gift tax or income tax. If an individual gives an individual more than that, or if you're not a non-profit, okay, then you're going to get gift tax. But I can give an individual $18,000, and then my wife can give an individual $18,000, and so that gets them $36,000. And so with grown children that are married, you can do it four times uh you know father to daughter father to son-in-law daughter or mom to daughter mom to son-in-law right uh and so that creates four checks of 18,000 so that would be 72,000 you can move so sorry guys just

don't need to get your hate later you hate me for a lot of things that i that i don't even do that one i actually did so um the other thing is this I want to I want to continue our conversation just a little bit just in general so the last caller Rachel you brought up um the most important part on that call which is that when you narrow it down to I've got just one shot yeah and if I miss that one shot on any decision that you're making you are now rationalizing the decision because it is not a fact that you only have one shot so there's if I don't get this house I'm never going to get a house if I don't buy this car I'm never going to get a car God only put one person on the entire planet for me to marry, and if I miss that one, I'm going to not be married.

Bull crap, okay? Just bad thinking skills. So any time that you allow anxiety, the stress and strain of life, the tragedies of life, the fact you've been fighting cancer or anything else to narrow you down to one singular decision, Rachel's point, it was that you're going to make a bad decision. Yeah, yeah, yeah. And we find that a lot with people because, you know, because money is a tool, you know,

in your life that you're using. And when life is hard or life feels out of control or life feels like, oh my gosh, this is one thing, then you use that tool money to go and try to get that control back. Yeah. And so there is a patience to slow down and to say, let me gather some more options, option A, B, and C. And out of that, then you can start making, okay, maybe the answer still is A for whatever your situation is, but at least you've researched and you've thought and you've taken time to look at B and C then you can start making okay maybe maybe the answer still is a for whatever your situation is but at least you've researched and you've thought and you've taken time to look at b and c um because man we just because i don't know we talk to people all the time and it was like we're in a house and

we shouldn't have bought it but we just thought it was a really good deal we didn't think we could find another deal like this so we got in it and turns out it wasn't you know like and you get in this mindset and it's just really it's really dangerous so a couple of bad decisions are one of the primary thing that's things that steal your wealth so decision making principles are important so decision making principle number one if you think there's only one or two things to do you haven't spent enough time gathering up options options are power options are informative options cause you to really think clearly and so um you know you know like the people that call and they go well we've got mold in our house and the only other house that we can live in is four thousand dollars a month and we

make five thousand so do we buy a house and go bankrupt or do we stay in the moldy house and kill our children you know and like you have two stupid butt options and i'm supposed to choose between these two c none of the above keep looking you haven't figured it out yet you know and so that's the kind of thing we're talking about we get that call actually so that's a call that's come in more than once over the years and so it's just because you justify the crap out of doing something you don't need to do well and fear will do that too did you hear that in your example of mold in the house which is very real but also her husband in the last call he said what if you relapse she said that you know

and there's a level of fear there and so facts john maloney says when you're facing trauma facts are your friends yep and facts are more and more and more options number two decision making principle slow down to the extent of the size of the decision. Quit spending all your calories on nothing decisions. Some people spend more time deciding which gum to purchase in the gas station than they do which car to purchase. You spent your calories on the wrong thing. The bigger the decision, the more time. And then, you know, I'm frozen with indecision dentine or eclipse and but i but i

impulsed a porsche you know it's like this is the backwards stuff right here you know so the the size of the decision your pulse rate needs to drop. If you've got house fever, go take a cold shower. Your pulse rate needs to drop. You're about to do something stupid because you can just hear it. You can hear the anxiety in people's voices when they call in here with these things, and not just her. She's a sweet girl.

She was nervous as part of it, too. Oh, yeah, yeah, yeah. No, but there's a high level of emotion. Then circle back one more thing on her call, because I really need to get this out here for her to hear and her husband to hear, but also everybody else. Okay. The option of taking your $128,000 and putting it into a spec house, building a house from the ground up on a piece of real estate and flipping it immediately, a house of speculation, builder spec house, is one option.

But let me just tell you, I grew up in the construction business. I've had my real estate license since I was 18, and I'm older than dirt. So I've been doing this stuff a long, long time. I can tell you for sure that if you have builder skills, you show up on time, you finish the project of renovation or new construction on time, and you build a budget and stick to the budget, you are an unusual animal. You are very, very marketable because most people in the construction business can't even show up, much less finish, and their numbers are so screwed that they piss everybody off they're dealing with because they don't show up on time, they miss their numbers, and they don't finish on time and so they never get repeat business because they make everybody mad that they're dealing with

if you'll just show up on time you you can own the world and finish on time and hit your numbers you can own the world so that young man if he can do the deal he thinks he can do, he can do renovations and make $300,000 a year. He can grow a renovation and custom housing business, build decks, put porches on the back, whatever it is. He can make a bazillion dollars if he has the skill set that she says he has, and I don't doubt it. Yeah. And if he can actually pull off projects. Yeah. Show up on time. a bath you know and

finish the project on time and hit your numbers you got no competition because nobody else in that space hardly does it very few do and the ones that do end up being custom home builders for the rich yeah because they're excellent at what they do. Exactly. Yeah. And so you got, dude, you got so much potential out there. If you do that, that you, I think you could take that. You can take $128,000 minus $36,000 worth of credit card debt.

Use that to do some, some renovations, parlay your way into 300,000 in cash and go do you a couple of these specs later if your numbers are right and i'm wrong because i think your numbers are unrealistic but if i'm wrong about that which i'm happy to be wrong i hope i hope i'm wrong i hope you make a hundred i hope you make a hundred percent margin on a construction project but it's very unusual not doesn't happen okay so if you can do that then you can do what i'm talking about with what's left over after you pay the credit card debt off yeah and that's your third option that's right that's right and it's a classic two example which just happens in so many families and so many marriages is you kind of got your realist and your dreamer right oh yeah and it's like oh just give me this give

me this shot give me this shot right and not that all dreamers are wrong because sometimes it's right. But also, I would say to him, listen to your wife. The emotional space in your home. Bring the peace. Bring the peace of not owing anyone anything. Bring the peace of having savings in the bank. Like, bring the peace. And then let's focus on everything else.

But that peace is for a wife that's been sick and kids that are sick. Like all of it. I'm like, oh, it's great piece. Yeah, the shame idea that I spent the money our family was going to get rich on to save me from cancer. And I'm ashamed. That's ridiculous. I mean, no, no, no, no, no, no, no, no, no, no, no. So, no, your family's going to be fine even though you had cancer.

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