The Ramsey Show - App - These Veterans Paid Off 12 Credit Cards and 3 Car Loans! (Hour 2)

Episode Date: November 11, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Cart Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host, Anthony O'Neill, Ramsey personality, number one best-selling author of the book Debt-Free Degree, is my co-host today. Open phones at 888-825-5225 as we talk about your life and your money. 888-825-5225. Brandon is with us in Denver to start off this hour. Hey, Brandon, how are you? I'm wonderful, sir. How are you today? Better than I deserve. How can we help? Perfect. I am a one-third owner of an LLC that owns three rental properties within it.

The LLC is owned one-third by myself, one-third by my brother, one-third by my parents. We all kind of got into business together about seven years ago. We would like to dissolve the LLC because we're all kind of at different points in our life and would like to be able to go do different things. Everything's good relationally, and we're trying to figure out the best way to do that without a really dramatic capital gains tax hit or if there's any way to do that. We all purchased into the LLC for about $210,000 each and bought rental property that was about $630,000 in value. It's now grown to about $1,095,000, which would mean each of our current stake in the LLC is about $365,000. We want to know, can we divvy up the LLC based on the property values of when we bought them

so that we can then each pay the capital gains tax later if we ever were to sell the properties, or do we have to do that now as of current market value? You're going to have to get with a tax professional. I probably would go so far as to recommend a tax attorney to help you walk through this. So your game plan, do all three properties have similar equities, and so you're just going to each take a property? Unfortunately, no. One is two of them are very similar. They're both fourplex units that are currently very, very similar. One is a single townhome. The two fourplexes are probably worth about $420,000 to $450,000 each.

Not counting the capital gains, does anyone necessarily want to really have a huge desire to keep any of these properties? We all would love to keep the properties because the real estate end is something all three of us would like to do long term. We're just looking to dissolve the partnership to keep good relationships and to make sure that we don't ever run into an area where we're trying to... Okay, so if they're unequal, one of you is going to give another one some money and the property. Which would work actually the best the way that is. My brother would like to take the smaller of the properties and then be able for us to pay him for the difference of what the value would be, which is no problem.

My wife and I have the money to do that. My parents have the money to do that. We would have no problem with that. I'll tell you how I think you can do it, but you're going to have to go to somebody that's about two notches smarter than me, to be sure. There's a thing called a 1031 tax deferred exchange, and that is how we used to trade properties in the old days. You know, you'd pick out a property that you wanted. I had a property, and we would trade the properties,

and the gains moved one property to the other, and there was no activation of the gain, no taxes. Okay? Yes, sir. Now they've advanced that to where you can sell a property Yes, sir. property and roll your equity into that and uh when you do it is it is considered a trade and so there is no taxes the capital gain that your basis moves from your old property into the new property so eventually someday somebody's going to get the tax hit but for now you've moved your equity and your taxable gains over into the other property. So what I'm thinking here is that you guys might be able to flip this whole thing into

that escrow account and use that escrow account to parse out each of you getting one of the three. In other words, you guys sell it into the escrow account, and then each of you buy the property that you want out of that escrow account under and then each of you buy the property that you want out of that escrow account under a 1031 tax deferred exchange umbrella. That might work. That was our hope initially. We actually have been to at least one accountant so far that's told us that's not an option

because since the properties are owned by the LLC, the LLC would have to then buy the properties, that you wouldn't be able to transfer them to individual ownership. Yeah, that's true. That's right. Okay. So much for my theory. I think you got better advice from him than you did me. Okay.

Crap. I'm just trying to keep from giving the government money. You and me both, brother. You and me both. Let me tell you Let me think here. Let me tell you, I think the other thing you can do is that you guys are going to have to trade some money with each other. But if one of you kept all the shares in the LLC, that one is going to have no gain. Right.

The other two are going to have gains when you move it out, and the one that keeps the shares in the LLC that doesn't have any gains is going to have to morally want to have to help pay the taxes that the other two create when you move them out. Which is absolutely an option that we looked at, kind of just making sure with that, both morally and legally, if we were to do that, and then that person who is not taking the capital gains hit, would it be both moral and legal to exchange funds to the people that are taking the capital gains hit under the gift tax law, or would that person then have to – okay.

You could do it under gift tax law, and if it's in excess of this next year's gift tax limit, which I don't remember what it is, probably $14,000 or so, it's indexed. It changes every year. This next year's gift tax limit, which I don't remember what it is, probably $14,000 or so, it's indexed. It changes every year. And if it's in excess of that, unless you guys have estates over $20 million each, you can do a unified estate tax credit and avoid the gift tax, and you can move any amount. Oh, I didn't think about going that route.

Okay, yeah. My parents would be over the $20,000, but they would probably be the one that would keep the share of the LLCs. $20 million. If we did. Or $20 million, excuse me. Yeah, they have a network over that, but we could probably do it. Okay.

There's a way to do that. Wow. And, you know, this is a great riddle. I love it. It's a wonderful riddle to work through. But there is a way to do it and screw the government. I promise you there is. And I'm going to find it eventually. You're on a mission.

I'm going to keep on this because there's a way to do it that is legal and moral under the current tax law. You've just got to think it through. And so far, two of the ideas didn't work. But, yeah, you can move some money around. I can give anybody money. Just if I give them more than the gift tax indexed amount, which I can't remember what that is this year, but I've got a cheat sheet here somewhere.

Well, can't even find that. Oh, well. Oh, well. Oh, no, it's $15,000. $15,000 right now, and it's going to go up. So, okay, so you can move $15,000, but your capital gains are going to be more than $15,000 on these things because you've doubled.

You've gone with $600,000 and $200,000 each. $300,000, $200,000, yeah. Well, your capital gains are probably only going to be $30,000 apiece on these things. It's not bad. If you depreciated them down pretty heavy, maybe it might be more than that. It might be $40,000. But you can get pretty close on the $15,000. You can do $15,000 one year, $15,000 another year, and not even get in the Unified Estate Tax Credit, maybe.

There's a way to do this. It's just a barrel of fish hooks that you're going to have. It's like when my ski rope gets tangled. I have to sit and take an hour and untangle it. But, you know, that's what you got here. Fun! This is the Dave Ramsey Show. I get the privilege every day to talk to smart, creative entrepreneurs doing great things for our economy.

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Folks, Grip6 is rebuilding and modernizing American manufacturing with products sourced in the U.S. Give these products as gifts this season. To get the Dave Ramsey special, visit GRIP6.com. Anthony O'Neill Ramsey personality is my co-host today. Open phones at 888-825-5225. Alina is with us in Cleveland, Ohio. Hi, Alina. How are you? Hi, Dave.

I'm good. How are you? Better than I deserve. What's up? So I just had a quick question. I'm making my debt snowball and I'm currently, I have a list right now for everything besides student loans and collections. Now I'm currently still in school. Do I pay off the student loans or do I go towards the collection?

Since the student loans are in deferment right now. How much longer do you have in school, Alina? If I continue two more years, if I stop and pay everything off, I would take a break for a year. Okay. Are you cash flowing the rest of your college experience right now? No. That's why I was planning on stopping to bring it back to cash flow okay all right so

there's a difference in paying everything off while you're taking time off to pay everything off or taking time off because you can't cash flow it yeah which is it um i'm taking time off because i can't cash flow and don't want to get more in student debt. Okay. Okay. And during that time, you're going to pile up money to go back to school first, or you're going to get out of debt first? Um, it would be paying off my debt and then start saving for school. Gotcha. Okay. Because if you quit school, you're going to activate these student loans, right? Right. All right. How much debt do you have total again?

Total is about $28,000. How old are you? 23. What are you studying? Finances. And how much of the $28,000 is student loan? Only $11,000. And how much of the 28 is student loan only 11 and what is in how much is in collections about seven okay what's that from uh credit cards and what's that called cash advance loans and how

long has it been since you've paid on those that are in collections? Majority of them are like a little over a year. Okay. And what is the other $10,000? Personal loans, my lease, my credit card that's active at the moment and what else is it? Okay, your lease. Yeah. Yes. What do you mean your lease? The lease payment.

What are you leasing? I put that in there. A car. Oh, okay. What do you owe on your car? What's it take to pay the car off? About a little less than $4,000, just about $4,000. So you're almost at the end of it? Yes. Are you working right now? I am. How much are you making? Yearly is about $34,000. Okay. What do you do? What do you do,lyse? I am in training to be an accountant.

Okay. So the student loans, you're not paying anything on those. Collections, you're not hardly paying anything on it. No. So it's almost as if you're out of debt now in terms of what your monthly exposure is. So why can't you cash flow school if you don't pay on the student loans and you don't pay on collections right now? Because that's the majority of your debt. I didn't even think of that.

How much does it cost you to go to school a semester? About $3,000, give or take. Yeah, $3,000. So you're looking at... Well, Ashley, you still can do that. You still can do that. What's your monthly payment on this lease? $350,000.

And it's going to be over in just a few months, right? Correct. And what are you going to do at the end of that for a car? I actually have a car that I did a stupid decision and went for the lease, but I'm going to go back to my regular card and give up the lease. And it's paid for? And it's paid for.

Yes. Okay. Yeah. So we get the lease paid off. We leave the collections in collections. Don't pay on the student loans. You don't pay on the student loans, and you cash flow college. And here's the other thing.

And you don't have to quit. Yeah. And you cut up these credit cards because you're just digging yourself into a deeper hole. That's a good catch. Alright, so because we're talking about these credit cards, you say you still have currently open. So you need to stop borrowing money right now.

Yes, I'm that one getting paid off next month actually and it's getting closed out. Is it cut up? Yes. You sure? you just said it was active you could be honest with me it's open as active but it's not i don't swipe it i can't swipe it up you did cut the card in half literally i sure did okay i'm proud of you yeah there we go yeah all right that's a good sign all right here's what i want you to do i want you to get in ramsey

plus yes sir we're going to pay for it for you, and that includes Financial Peace University, the Every Dollar Premium app, everything you need to get through this, kiddo. There's no reason for you to quit school. I want you to keep going. But you're going to take an extra job, and you're going to have about one more year.

You're going to be real tired this year. Because you're going to work all the time and go to school all the time. But here's what's going to happen at the end of that year. You're going to have no current credit card debt. You're going to have no car debt. And you're going to have gotten rid of the personal loan. So the only debt that you have, you're not making payments on. And then you'll be able to cash flow school originally.

Does that make sense? It does. And I think you can stay in school and do every bit of this, but you're going to be working a lot. Yeah. That's $6,000 a year. You can do that, Alina. And honestly, maybe even consider looking at Uber.

And since you're online and you already have two years into it, maybe even consider going online and doing some tutoring so you can make up your own hours so it doesn't get in the way of your education process. But you can get the $6,000 just from doing a side gig. Yeah, you can deliver pizzas and get that. Yeah. And so knock this stuff out, get that car gone, get the active credit cards gone,

leave the stuff that's in collections in collections. The student loans are still stagnant while you're in school, so you're not having a cash flow there. Then all we've got to come up with is $3,000 a semester, and you can get that. But you're going to have to be on a real detailed plan, and it's like an obsession for you that I'm going to school with adding no more debt, and then when you come out of school, you can address that remaining $18,000 very, very quickly, and you will know how to do it because I'm going to teach you how. Anthony's going to teach you how in Financial Peace University with Ramsey Plus.

So I'm going to give you a one-year membership, and you go through every detail of that, and you do everything I say to do. And if you do that, you're going to come out and be going touchdown. Yes. You're going to be going, I freaking won. And don't go make up your own plan. Ours works. Yeah. All right? down yes you're gonna be going i freaking want and don't go make up your own plan ours works yeah all right so hold on kelly i'll pick up and we're gonna get you signed up as a gift and i don't want you to quit school i want you to finish yeah i'm proud of you you're you're

a neat young lady and some people probably ask himself well how come dave didn't tell her to stop and pay off her debt because she's already halfway there. That's three grand. Yes. Yeah. She's not going to an expensive school. No. If she told me she was going to spend $50,000 a year, she's quitting. Right.

Because there's no way she's cash flowing that. Right. This is within reach. Yes. And the student loans can sit there. That's what they're designed to do for a student. Absolutely. And the collections, they can sit there too.

Absolutely. The longer they sit there, the more pliable they'll get. Only, only, only, only on the Day Raptor Show. But at the same time, though, $6,000 a year, that's less than the average. Way less. You know, the average is $10,000 a year. Yeah, yeah. So she's in a good position to go on ahead and cash flow that.

Oh, yeah. Kelly, give her his debt-free degree book, too. Absolutely. To go with the Ramsey Plus package. Oh, my gosh. She definitely needs that. Yeah. Yeah.

You didn't think about giving away your book? Absolutely. What's wrong with you? Go ahead and give her Destroy Your Student Loan Debt so she can already read that as well. Yeah. Just give her everything. Just give her everything. I'm sorry, Kelly.

Kelly's looking at us like, what's going on? So give her Ramsey Plus, that free degree. Kelly's about to cuss us out, but I'm with the boss, so I'm good. Well, ain't nothing new about that. Open phones at 888-825-5225. Here's the thing. How do you eat an elephant? A bite at a time.

With a freaking plan. Yes. You don't randomly run up and take a chunk out of it. That's good. You've got a plan, and you execute step by step by step through that plan, and it will take you into your future. And then when somebody asks, you can say, I'm living the dream. Yes, sir.

This is The Dave Ramsey Show. I bring veterans today to all of those of you that are serving and have served. On the debt-free stage, we continue that in the appropriate fatigues that are here. And Larry and Melissa are with us from Phoenix, right here on the debt-free stage in Nashville. Hey, guys. Welcome. Hi. Hello. So you're obviously military, that or you went to a supply store. A surplus store, right?

Dave, I think we have our own surplus store. You got your own at home. Been serving a while, have you? Yes. Okay. What do you guys do in the military? So I'm public health. And I'm a military police officer.

Public health must be really exciting right now in the military. Yes, sir. Perfect time to serve. Yeah. Wow. Amazing. How long sir. Perfect time to serve. Yeah. Wow. Amazing. How long have you guys been in? 18 years.

Both? I've been in 17 years. Okay. Did you meet there? In a military training class. Wow. Very cool. Very cool.

And both of you made a career out of it. Thank you for your service. Yes. Absolutely incredible. All right. How much debt have you paid off? We paid off $135,000. Very cool. How long did this take? $135,000. Very cool.

How long did this take? Two years, nine months. Very good. And your range of income during that time? About $137,000 to $147,000. Very cool. Good. Very neat.

What kind of debt was the $135,000? So it was all consumer, just credit cards and car loans. Just that simple? Yes, sir. Wow. Wow. That's some nice cars. Yes, sir. That or you just went hog wild on a credit Just that simple? Yes, sir. Wow. Wow. That's some nice cars. Yes, sir.

That or you just went hog wild on a credit card. I don't know which. And a lot of vacations. Wow. Yes. Okay. Did y'all sell any of the cars or you just paid them off? So we traded in both.

Okay. And got different cars so we could get quick, you know, move quicker through Baby Step 2. Yes. Got cheaper stuff. Cheaper stuff, yes. Okay. So what did you sell and what did you trade for? So I sold a GMC Acadia Denali down to a Honda Civic, which I love.

Honda Accord. That would have fit in the back of the Denali. Okay. And then. I traded a Cadillac CTS Coupe for a Ford Escape. It was a sad day, Dave. Oh, that one hurts. It was not easy.

Oh, that hurts. Yes. You guys won it out of debt fast. We did. Fast. We did. Wow, that's impressive. Now, people had to be giving you a hard time.

Yes, they said we were crazy. You go from Denali and CTS to Escape and Civic. Oh, my God, The driveway cringed. That is awesome. Yes, sir. That was really, all joking aside, emotionally painful days. Oh, yeah. I think more so for him.

Yeah. I'm a car guy. Since I've been younger, I've drove nothing but sports cars. So going to the Escape was a little rough for me. Yeah, that CTS is a beast, too. I loved it. It's a great car. Yes.

Oh, man. How many weeks later was it that you just said, God, I'm so smart? Oh, for me, I don't know. You're still wondering. I was going with the flow, Dave. Oh, no. Oh, no. Okay. You got outranked or something. I don't know, Dave. Oh, no. Oh, no. Okay.

You got outranked or something. I don't know what happened. It's true. All right. Very cool. Okay. So, well, the good news is that you've lived like no one else now. You can live and drive like no one else.

You'll be able to pay cash and drive whatever you want. Yeah. So, very, very cool. So, what started this intense journey? Because you did a really hard thing selling those cars. So, uh, we came home to water leaking through the floorboards, uh, that we had just charged $14,000 to install. Oh no.

And we thought we were safe with our home warranty that we had purchased with the, with the, you know, selling it with the buying of our home. Uh, and unfortunately that, that didn't pan out for us. So, uh, we made a lot of tearful phone calls to plumbers, but we didn't have any money. The home warranty wouldn't cover us. We had no money in savings and all of our credit cards were maxed out. So the water was turned off and we had three kids in the house. So we were pushed pretty far to our limit. And a plumber, out of the kindness of his heart or desperation in my voice, I'm not sure which one, uh, actually ended up coming out that night and it ended up being

a small feat. It was only $75 to fix the actual problem. Uh, but unfortunately we went to bed with a feeling of dread that night. So we went out the next day to the library and found the total money makeover and, uh, read it out loud, uh, that weekend to each other, uh, fought a lot, and started Baby Step 1, the next pay cycle. Wow. That's an intense process. Yeah.

Yeah. Ouch. How long have y'all been married? We just celebrated 10 years in July. Wow. How old are your kids? So Phoenix is 17, and then we have noah who's six and lily is four awesome very cool yes very cool wow that's a you know when you have something that dramatic

that just hits you in the face you gotta face it then you can't you can't just walk away from that i mean it's two in your face right right so you. So you had to do it, both of you. And so that gives you enough emotional energy to run through the CTX to the Ford Focus move. It takes some emotional energy to do that. Right. Or the Denali to the Civic, either one. But wow. Wow. Again, thank you for serving.

I grew up as a military child, and some things probably have changed. So tell me. But one of the things I see coming from back when I was living on, uh, in Fayetteville at Fort Bragg, I would see these young, young guys get their, their signing bonuses,

get their first check and run to the car dealership and buy the, the big, nice brand new cars to that young person listening to you today. What would you tell them that you wish you knew when you all first started in the military with all the great benefits that you all receive? So for me, I work with probably like 30 young men and women that are around in their younger 20s and teens, some of them. And I explain to them to do not go out and get a car that you can't afford, you know, save your money. Many of them have the money to buy a car in cash, but the flashy thing that they keep

in the parking lot is what they want. And I think that's, you know, like a showstopper. But if they save their money and they do right by their money, they can actually drive whatever they want. And that's where I had to learn myself. And I'm able to talk to them about that because I've had to walk that line myself. And hopefully for those out there, they do it the right way, and they save the money and buy a nice car in cash.

We've got a lot of chaplains teaching Financial Peace University all over the world through the military, and I've gotten the opportunity to be on several installations, several bases around. And especially in America, it amazes me that when you leave the gates, there is stupid for two miles on both sides of the road. Like every dumb thing a 22-year-old can do on the planet, stupid human tricks, stupid financial tricks, whatever they are, they're on both sides of the road for two miles outside of every base.

It's like the worst of the worst. Man, I tell you, you guys that are officers and senior people have a real job just corralling some 22-year-olds or 21-year-olds who left home for the first time and keeping them out of that. That's a deal, man. It's a real deal. I think we focus on small goals for them. When we try to share our story, we try not to say, hey, pay off all your debt and sell everything and don't eat out for three years because then people are like, whoa, no thank you.

Yeah, that's true. We try to sell it to them in small doses, and one that's really effective is showing them the calculator. So if you invest your car note, it'll grow to this much in 10, 20, 30 years. That's a $5 million car you're driving. I hope you like it. Exactly. And then the $27 a day is $10,000 a year. That seems to be really effective to people as well. That's good. I like it. Small doses for me. Very cool. Well, thank you again. Thank you for your

service. Thank you for your incredible story because you guys went all in. I mean, there's no question. You've completely changed the way your brain works about money. I mean, you blew up everything. It's very impressive. It is strenuous. That much emotional shift in two years and nine months is strenuous. It really is. It adds a stress level to your life to just have that much transformation going on,

even though it's positive. So very, very, very well done. So very proud of you guys got a copy of chris hogan's book for you everyday millionaires we want that to definitely be the next chapter in your story and i think you're well on your way and uh the good news is larry you're gonna get a better car later yeah don't worry they've already got that good good i love it well i want you to have a good car. These people drive in a junk car and they go, that's my Dave car.

I went, wait a minute. Your Dave car is when you get rich and buy anything you want. Come on. That's your Dave car. So let's get the kids in the picture before we do the scream and introduce some Phoenix. Noah and Lily are with us to do the debt-free scream together with their mom and dad. Yeah, Dave. Phoenix couldn't make it today.

Oh, okay. But Noah and Lily will be here today. Perfect. Shout out to Phoenix. That'll still mark the day. All right, count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free! Yay! This is The Dave Ramsey personality is my co-host today here on the air this is the Dave Ramsey show open phones at 888-825-5225 Jason is with us in Detroit hi Jason welcome to the Dave Ramsey show hey Dave thanks for taking my call how are you better than I deserve how can I help Jason is with us in Detroit. Hi, Jason. Welcome to the Dave Ramsey Show. Hey, Dave. Thanks for taking my call. How are you?

Better than I deserve. How can I help? Well, I had a question for you. I've been working with a financial advisor who's giving me some advice, and I follow the show. I'm on Baby Step 7 currently. But he presented me with an idea that was a little outside the box, and I have term life insurance. I've been anti-whole life.

But he presented me with this infinite banking concept. Jesus, you're kidding me. Yeah, I have excess money in a savings account and looking to rebalance my portfolio to get it to work a little bit harder. But my risk tolerance is a little bit low. And he showed me how you can do this where you overfund the whole life policy you can access the money you break even in year seven and the dividend outruns what you put into it yeah it doesn't seem like a terrible idea in that regard but i just wanted your your take on why you know that might not be the best way to go the the problem is that you where it gets confusing it is that um god he's selling a dividend a financial advisor is this this is an insurance guy well he's he's both they have

you know it's one of the bigger companies um yeah like northwestern mutual or prudential exactly yeah okay he's an insurance guy he's not a financial advisor okay okay so because those are Yeah, like Northwestern Mutual or Prudential. Exactly. Yeah. Okay. He's an insurance guy. He's not a financial advisor. Okay. Because those are both mutual companies. Now, there are two types of life insurance companies, mutual and stock. Okay?

Likely you bought your term, unless you bought it from him, from a stock company. A stock company, stockholders own the insurance company a mutual company which is prue and northwestern state farm is mutual is the policy holders are actually the stockholders okay okay so when the company makes a profit the policy holders receive a dividend as if they were a stockholder and received a dividend. Does that make sense? Yep. Now, follow the math here. If you are the owner of the company and you're also the customer of the company and the only place the company gets money is from the customers that are owners

and they give you money from a profit, by definition, that means it's because they took too much from you as a customer. There wouldn't have been a profit otherwise. Okay. So the IRS has deemed, consequently, that mutual life insurance company dividends are not dividends in the true sense of a dividend, that instead they are, and this is the IRS's language, they are instead a refund of a deliberate overcharge. So they overcharge you in order to give you some money later to make you feel like you're making money off of them.

And it's absolute hogwash it's a pass-through mathematically it's a pastor it's it's the way it has to be it's the legal definition the freaking company and the irs says so so yeah the thing i didn't love is you know you when you take the money back you basically are paying an interest rate on it exactly and whose money is this right that you're borrowing you're borrowing your own money and you're paying them interest yep this is infinite banking for them yeah yeah the infinite banking concept is is old school whole life done poorly you need a real financial advisor not an insurance broker that's trying to sell you a load of manure

and so yeah the other thing is is that your cash values that are sitting there all die with you so whatever cash you put into this is equals zero at your death because they only pay the face value prue does not have a policy northwestern mutual does not have a policy that pays more than the face value except universal life b's which are not in infinite banking products and universal product b is where they charge more than they usually charge which basically buys the insurance so they can still keep your money is the way the math actually works on this so you're dealing with one of the most expensive insurance products in the marketplace if you're dealing with one of the most expensive insurance products in the marketplace if you're dealing with either one of those two companies i would stay completely away from both

of them they're um everyone in the financial field except people that work for them we all think they're a joke all of us anyone who's academically trained or has any kind of CFP or anything else, when someone says they work for Northwestern Mutual, we just kind of laugh and go, yeah, right, you screw people every day. So, dude, you need to get away from them, and you need to go get a real financial advisor that can help you do some real investing that takes into consideration your low-risk tolerance. Low-risk tolerance does not need to lead you to losing your money a hundred percent of the cash invested at death yeah that's a bad

risk tolerance thing so you need to move on dude you need to move on but because the and the whole thing of the dividends are paying for it is such a joke because the dividends are the refund of a deliberate overcharge so who's paying for it? If you own Home Depot stock and you got dividends from that, then Home Depot's making a profit, but they're making a profit off of their customers, and I'm the owner of the investment. I get that dividend. That's different than if I am the customer and I'm the stockholder,

thereby the only way I made a profit was off of me myself so i pay you an extra hundred bucks and then you give me 70 of it and i'm supposed to feel great about that right yeah so that's what this amounts to and so you guys working with state farm when you get your little dividend check that's what it is it's the refund of a deliberate overcharge irs verbatim says that yeah and that's why you don't get taxed on it if you get a dividend on home depot stock you get taxed on it as income because it's real income you really made an investment and then you really made an income so that's what's going on with that stuff and so do not buy anything in the life insurance world based on dividends. Look at the price.

Look at the structure of the policy. And you'll usually find that mutual companies, by the way, are the higher priced. So when you go to a quote service like a Zander Insurance and you get quoted on term life insurance, you're going to find no mutual companies in the 42 different companies that they give you a quote from because they're not competitive. That's it. Why? Because they charge more so they can give some of it to you back later and make you

feel like that you got something. That's really what it amounts to. And that's why you won't find them. They're not competitive. Yeah. Dave, you're fired up about this one. Man, I tell you what, pisses me off. Infinite banking my butt.

Okay, Dave. Infinite banking is for them yes the only listen the only thing you that that agent has for his whole life is a need for your commission to be paid to him absolutely that's the only whole life thing that is involved here uh these products are horrendous yeah and you know it's bad enough when they feed on the middle class but that guy's a baby step seven, man. He's probably a millionaire. Yeah. And they create such a jumbled word picture that you can't cut through the BS. And yet, you know, the thing about him, did you notice what happened with him?

This is interesting. It didn't feel right to Jason. Yeah, yeah. He felt it, didn't he? Yeah, he felt it. And that's probably because he's going through our process and he knows what we teach. Yeah, yeah. He felt it, didn't he? Yeah, he felt it. And that's probably because he's going through our process and he knows what we teach. Well, it's not just that. He didn't just say, well, Dave says it's wrong.

Right. There's something wrong here. I just can't put my finger on it. Yeah. Overpay and get money back. But, I mean, you ever have those feelings? I don't know exactly what's wrong, but I smell a rat. Yeah.

Which means there's a dead rat in the corner somewhere. I just hadn't found him yet. Or below the couch. Something stinks in here. Yeah. Something stinks in here. Something stinks in here. Something got in the house and died. You know, I got a smell in here. What is it?

Something's wrong. You can't find it. You can't put your finger on it. But how many times have you been in a situation with a person or with a product, a financial product? You know, you had one. You had one. You were buying an item.

I won't say what it was on the air, but you got the smell off the people, and you ran. It wasn't three weeks ago. What was it, Dave? Tell me. What was it? I'm not going to, because they might be listeners, and I'm not going to do that to you. I'm going to throw you under the bus. No, say it.

But you walked out of a deal into a different deal not long ago. Oh, yes, sir. I sure did. And was it not the same thing? It was the exact holy spirit inside of you said i smell a rat something's not right something be wrong with these people i ran this deal is there i can't put my finger on it but this deal is bad yes and you ended up in another deal there's a much better deal because you listened. Even though you couldn't logically explain it, you could listen to your heart.

Absolutely. Listen to the bell when the bell rings. It's called the Holy Spirit. This is the Dave Ramsey Show. Oh, man. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. If you would like to do your debt-free scream live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.