The Ramsey Show - App - They Paid Off $347,000 in 6.5 Years! (Hour 3)

Episode Date: January 5, 2021

Debt, Retirement Sign Up for a FREE trial of Ramsey+ TODAY: https://bit.ly/31ricKt  Tools to get you started:  Debt Calculator: https://bit.ly/2QIoSPV Insurance Coverage Checkup: https://bit.ly/2BrqEuo Complete Guide to Budgeting: https://bit.ly/2QEyonc Check out more Ramsey Network podcasts: https://bit.ly/2JgzaQR

Music Music Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car 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. My co-host today on the air, Ramsey personality, number one best-selling author, and my daughter, Rachel Cruz. It is book launch day at Ramsey, which means we are in high gear all over this building. Lots of media hits, lots of things happening,

and Rachel's doing all of them. The new book, Know Yourself, Know Your Money, hit the shelves today. A labor of love for over a year, it takes to put one of these things together and get it out. Know yourself, know your money, discover why you handle money the way you do, and what to do about it. And Rachel, our Your Seven Money Tendencies have been one of the things

that people get their hands around first in the book. It's not the only thing that you teach about knowing yourself to know your money. But the seven tendencies are something that people gravitate to immediately. That and how you grew up. I was going to say the childhood money classrooms, the tendencies, and even the fears, the money fears is something people relate to a lot. Yeah, the tendencies are fun just because there's not a right or wrong. It's just understanding and unpacking. Okay, here's where I tend to lean when it comes to my money. And it just gives you a level of awareness and to say, okay, I can now

figure out when I'm being unhealthy in that area, when I'm okay and functioning well. It gives you kind of this guidepost. And another level of this, which I love, is you start to understand other people in your life, your spouse, your parents, your grown kids, your friends. It gives you a level of empathy to say okay they're different than me when it comes to money not right or wrong necessarily in these tendencies but they're different and here's their view they're looking at money a little differently than i am okay and so the seven right quick rattle them off do i oh it's like the the test okay nerd versus free spirit spender versus saver experience versus things uh quality over quantity or versus

i shouldn't say over um abundance versus scarcity safety versus status which is why you want money is it safety or status and the seventh is on giving so it's more calculated or emotional giver which one you are okay so those are big and then the childhood classrooms i think that those are really fun there's four of them of understanding how you grew up with money so money was communicated in two ways in the household it's communicated verbally and it's communicated emotionally so the first money classroom is the anxious money classroom and this is where it's verbally closed and emotionally stressed you can feel in the air but it's not talked That's right. So you probably felt tension at the end of the month when bills were paid, but you didn't know why,

but tension around money. Classroom number two is the unstable money classroom. So this is where it's verbally open, but emotionally stressed. So if you grew up in this classroom, you heard fights about money. Your parents may have fought with extended family members about money.

They may have had the same money fight over and over and over again, but man, it was loud and you knew it was happening. Classroom number three is the unaware money classroom. So this is where it's verbally closed, but emotionally calm. So never talked about, but it wasn't an issue. And so your head was probably in the sands. People that grew up in this classroom really didn't even think about money until they were out on their own. And they realized, oh, wow, I have to learn a lot and I have a little bit of catching up to do. And then that classroom number four, the last one is the healthiest money classroom.

And it's where it's verbally open and emotionally calm. So you could have $10 in this classroom. You could have 10 million, but it's the matter that it is being controlled. There's a plan in place. It's agreed upon if you're if you have parents that were still together and it was just it was calm, but it was also talked about. Money was talked about and communicated. So that's the fourth money classroom that I really want to push the reader

to move currently to with their family now. But looking back to your own childhood to say, okay, here's how I grew up, because every single one of them come with some red flags of, okay, this is an area I'm probably going to have to overcome because of my childhood classroom. And most people don't grow up in the fourth one. No, most don't. No.

I was on a show yesterday, and they had their whole staff speaking in, which was so fun, on the YouTube show. And the host grew up in classroom two. Her husband grew up in classroom one. We had one of each of them, which was so interesting. One of her producers was classroom three. And actually, one of the girls was classroom four. And her and I both, because I would say I grew up there, somewhat classroom two, but I don't remember that.

Because you said there was a lot of stress, but I was born the year of the bankruptcy. But really, even that classroom four, just because your parents are smart with money, it's not a gene. You're not automatically going to be smart with money. You have to work at it too and it's that classic larry burkett line that you spend the first five to seven years of your marriage trying to obtain the same standard of living as your parents but it took your parents 30 years to get there so there can be a little bit of a level of entitlement in that classroom four if you're not careful so when you're in classroom four you still have to be safeguarding that okay i still have to be making decisions on my own i still have to be working hard and it's up to me and my hard work to stay in that classroom for yeah nobody's gonna do it

for you you're what's known as a grown-up now yeah so yeah so that's a fun i think it's always interesting to think about how you grew up and how it affects you and what's fascinating too is talking to people people either mirror what their parents did unintentionally or they have a visceral response and they do the complete opposite they do the complete opposite so it's good just to just to be aware that's true with parenting style that's true a lot of things yeah yeah the book is know yourself know your money by number one best-selling author rachel cruz this will be her third bestseller uh discover why you handle money the way you do and what to do about it.

Know yourself, know your money. It is on bookstore shelves now. It is available. We are doing a virtual book tour, a virtual launch. Rachel's doing 100 and some odd media appearances in about a four-day period of time, including Good Morning America in the morning. Be sure you tune that in at about 8.20. She'll be on.

We're doing a virtual launch party for the book. You can join Rachel on January the 6th. That's Wednesday. And January the 7th, that's Thursday, both at 7 p.m. at rachelcruz.com live. Just go to rachelcruz.com. There'll be a live feed there and you can ask her your money questions so join her you can sign up for the uh uh you know for the launch party or be there january the 6th or 7th at 7 p.m jump in rachelcruz.com make it part of your lineup we

are also working to help you get started on your new year this year. And after 2020, everybody needs a reset. We need to relook. We need to reset emotionally, reset financially, reset everything. And if you want to reset, we're doing it this coming Tuesday night. And so lots of things going on. All of this that we've mentioned so far is free. So be sure you check it out.

We're doing a reset event live from Oklahoma City. Rachel Cruz, Chris Hogan, me, and Pastor Craig Groeschel will be doing it from his church at lifechurch.tv. Rachel will be speaking on Know Yourself, Know Your Money. Pastor Craig on Discipline. Chris Hogan and I are going to walk you through the whole reset process and the steps to take, exactly what to do. This is a 100% free live stream. It is next Tuesday night, January the 12th at 7 p.m. This coming Tuesday night, January the 12th at 7 p.m.

And just go to Dave Ramsey. To register for the free live stream, you do need to register or it's not going to happen for you. Text the word RESET to 33789. That's 33789. And for those of you in Oklahoma City, we have a few seats, just a handful. They're only $20. They may be gone by now. But, of course, it's limited because of distancing and all those kinds of things to meet the guidelines and stuff.

So go to DaveRamsey.com slash events and see if there's any seats available. If you're in the Oklahoma City area, we'd love to have you come out Tuesday, January the 12th, for this reset live stream with four, well, four people who are well-known for speaking on these subjects. I guess that's the best way to say it. This is the Dave Ramsey Show. I'm going to go on a little rant here for a minute. I took a call from a father who wanted to know how to plan for the care of his special needs daughter after he dies. Why is it that parents of special needs children are so deliberate in their planning while other parents have a tendency to be sloppy?

Do the needs of your family matter less if something happens to you? Oh, I'm sorry. Did I just guilt trip you into getting some term life insurance? Well, then good. Your family needs you to step up. Having the right amount of term life insurance is a matter of personal responsibility. If you want to use the new year as a reason for doing the right thing, then do it. Term life insurance is something every family needs, which is why I talk about it every day. It's not complicated, it's not expensive, and you need to do this now. Zander Insurance is the only place I recommend. Visit zander.com or call them at 800-356-4282. Please learn from other people's mistakes and get

this taken care of. That's 800-356-4282 or Zander.com. Rachel Cruz, Ramsey personality, is my co-host today. This is the Dave Ramsey Show. Open phones at 888-825-5225. Josh is with us. Josh is in Mount Vernon, Ohio. Hi, Josh. Welcome to the Dave Ramsey Show. Thank you for having me. How are you guys doing today? Better than we deserve. What's up? I have a question for you guys. My wife and I finally finished off, well, we're finishing off this Friday for

Baby Step 2. Yay! How long did that take? Thanks. Uh, 26 months. All right. Good for you. Thanks. Um, so we are moving in and we're going to be, uh, doing our, uh, baby step three, which is saving, you know, our, uh, three months for our emergency fund. And we also are home owners. Uh, at the time it wasn't a very wise decision to purchase a house because we went with a three percent conventional for a 30 year um with a rate of 4.125 percent um we're going to get to a place where we want to refinance and with rates being what they are around 2.2 to 2.9 percent in our area um and i did not know if it would be best to go through um getting

the full refund of three months saved first yes um and then save up separately yeah because you don't have enough equity to roll your closing costs into your refinance do you um i'd say no if you don't and i don't think you do probably because you didn't put enough down uh so i imagine i would imagine you can't if you I don't think you do probably because you didn't put enough down. So I would imagine you can't. If you can roll it in, you can do it whenever you want. But if you've got to cash flow your closing costs, you've got to do that after your emergency fund is done. Okay. So let's treat that more like a 3B.

It would just be something you purchase while you're doing 4, 5, and 6. Like if you bought a couch or you upgraded a car or you did something else. In this case, it's closing costs on the loan. Okay. And let me tell you how I did that from a critical thinking standpoint, okay? Okay. If it's not an emergency, it doesn't go before the emergency fund. Yeah. That's how I put it before the emergency fund. Yeah.

That's how I put it after the emergency fund. This is a good idea, but it's not an emergency. Okay, so even if rates fluctuate a little bit, which I'm sure they will, still better than the 4.125. Exactly. But definitely wait until after we're done. The number of times rates move more than 1% in a four- or five-month period of time is almost zero.

Okay. They'll move an eighth, a quarter, something like that, one direction or another, but they just really don't move that much that dramatically, and you're going to be done with that Baby Step 3 pretty quick. Well done, sir. Yeah, pretty good. I mean, but you would say this is still go ahead and start Baby Step 4, though, like start funding retirement. Yeah, I mean, I'm okay if you did it as a baby step three b even yeah yeah

you know treat it treat it like a down payment thing if you want to but it's not an emergency right because see let's let's say you took five thousand dollars and that's the only five thousand dollars you had and you need a refi and then the transmission goes out on your car and you lose your job and there's a pandemic. Right. You're screwed. You know? And so that's how you know that it would have been a bad idea. That's right.

You run it through a stress test. Yes. A hypothetical stress test in your mind. And then you can tell, oh, I should have done the emergency fund first. It's more important than saving a couple points or a quarter of a point on my interest rate by letting it ride a little bit. And that's the interesting thing about money and talking about it in this way, because it sometimes trumps math, right? Like the idea of like, well, interest rates and they could fluctuate.

And it's not a math problem. No, it's not. It's safeguarding and continuing to put that strong financial foundation under you. Yeah. And, you know, in that same light baby steps one two and three are you defy everything you you put math aside you use the debt snowball you stop your 401k even with a match you um you know you defy all the mathematics you put 36 months of expenses not your house is on fire yeah you're in debt and you have no money.

You are an accident looking for a place to happen. You are normal in America and normal sucks. 78% of Americans live paycheck to paycheck. Don't live that way. So one through three is the house is on fire. So we don't sit and discuss theory when the house is on fire. You get your butt out of the house. And you get yourself out of debt and you get that emergency fund in place.

Then when you break through baby step three, that's when you cannot be gazelle intense anymore. And instead of intense, you're intentional. And you start saying, okay, now we've got to start talking about retirement, four. We've got to start talking about kids' college, five. We've got to start talking about paying off the house, six. We've got to upgrade this couch. This spring is sticking me in my butt every time I sit down here. We've got to get a about kids' college, five. We've got to start talking about paying off the house, six. We've got to upgrade this couch. This spring is sticking me in my butt every time I sit down here. We've got to get a car.

It's awful. This beater we've been driving while we were getting out of debt is horrible. It's time to get a car that doesn't have a name, you know, and so on, right? And so you start moving up in a few things here or there, but you're careful and you're intentional, but you don't have to live on beans and rice, rice and beans. Oh, by the way, that's when you would go on vacation is only after baby step three. And that's when you'd go out to eat is only after baby step three. You shouldn't be going out to eat.

I know people think I've lost my dadgum money, but let me tell you what. When you have a pandemic hit and you have no freaking money because you've been in restaurants, you look like a freaking fool because you are. You shouldn't have been going out to eat. You spent all your dadgum money in a restaurant yeah and i don't mind going out to eat i love going out to eat you love going out to eat the ramseys love to eat we are we are social animals but um i'm getting an email it's commercial break from my wife about going out to eat with another couple you know i mean this is normal but But the problem is when you're broke, it's foolish because it is not economics that causes you to eat out. You know, 90% of what you spend at a stinking restaurant is not the food.

You could have bought all that food for 10% or 15% at the store and gone home and cooked it. Oh, and then made four other meals after that. Well, yeah. The cooking, yes. A whole bunch, yeah. And then got leftovers in the whole bed god help me sharon ramsey but um with her leftovers oh she's still after all these years but um like we can't afford food with food i'm like mom those green beans i live like no one else now i want to eat like no one else stop it but um so yeah but the the uh the point is is that you need to treat the first three like you're in an emergency, like it's on fire.

And then after that, you're intentional, which means you're thoughtful. You're thinking about, okay, if I do that, I won't be able to do this. And what's more important? Would I rather do my kid's college than that couch or whatever? You know, we got to get a couch. It's ridiculous. Family's not been on vacation in five years we're going to spend a reasonable amount and go on and do a decent little vacation of some kind if you could find a state that's open and um whatever right

yes you can start you can you know you you don't relax to the point that you go back to stupid land but you relax to the point that you can enjoy a few of the creature comforts again when you're in four, five, and six. Yep. But that idea, though, that it's so behavior-based, especially baby steps one through three. It's not the math thing like we were talking about earlier. It really is. It's your behavior and getting ahead and what ends up happening when you actually get traction for the first time in your life.

And by the way, it's not just a Ramsey thing. It's not something Dave ramsey thing it's not something dave ramsey or the ramsey organization came up with it's a data thing i mean when we study millionaires the way they became millionaires was not math it was managing behavior none of them were i mean virtually none of them 90 something percent of them were not uber sophisticated had the figure had figured out the idea of how to get rich at bitcoin or how to get rich of beat the card game in vegas or they weren't day traders or they weren't they weren't they didn't spend their whole lives with their nose in a mutual fund book they didn't do any of that they just loaded up their 401k

paid off their house and they really did not were not very sophisticated a lot of them weren't that super efficient with their math with the math on the investing they didn't spend a whole bunch of time studying it sometimes they had an investment advisor sometimes they didn't but they didn't sit and wring their hands over the 12b1 fees in a mutual fund and And they didn't say no load versus load, the great comparison. They didn't go through all that crap. They just put money in way. Just did it, yes.

Just did it. While everybody else is talking about their freaking theories and they're broke, these guys go and do it. It's a do it thing. It's a behavior thing. And that is what makes people wealthy. And what gets you away from the wolf's door in stuff like a pandemic hits.

Yeah, and it's the long game. There's no short-term fix. Yeah, Beverly Sills said it. No shortcut to any place worth going. That's a great quote. It is a good quote. No shortcut to any place that's worth going. It takes the time, but it's worth it.

Yeah. There's not a pill to make you lose weight, and there's not a pill to get you out of debt. There's not a microwave. You just got to freaking do it. This is the Dave Ramsey Show. We'll be right back. In the lobby of Ramsey Solutions on the debt-free stage, Joshua and Julia are with us. Hey, guys, welcome. Happy New Year. Happy New Year to you.

You're the first in-person debt-free Scream of the Year. Awesome. Awesome. Well done. I love it. How much have you paid off? $347,000 in

six and a half years, roughly. Wow. And your range of income during that time? Of $155,000 to $250,000. Cool. What do you guys do for a living? I'm a nurse and ethicist. I stay home with kids. Okay, great. And I'm going to guess with the length of time and the

amount of money you paid off your house we sure did i've been waiting so long to hear you say that people are in front of me that's right so what's this house worth right around 350 000 okay and it's yours it's all ours by god it's amazing i love it way to ours. By God. It's amazing. I love it. Way to go, you guys. I love mowing the grass. Every blade is ours. Because it's yours. That's how that works. That's right.

I love it. I'm so proud of y'all. How old are you? I'm 35. 33. And you have a paid-for house. Yes, sir. You are officially weird.

Man, how many 35-year-old friends do you have with a paid-for house? None. A lot of them tell us to not do it. None. Yeah. That's crazy. Okay, so what made you do this? I understand the getting out of debt, but it's like we're going to hit the gear and pay off the house. Right.

So we're both FBU babies. I grew up on the envelope system, and Josh did his seventh grade algebra homework from the back of an FBU classroom. So it was a no-brainer, obviously, to pay off the student loans as soon as he graduated from anesthesia school. And we took a little bit of a break, started a family, and then it came to where we needed to decide, do we put an extra sum of money toward retirement or do we pay off the house? And, of course, we got a lot of people saying, why would you pay off your house? Don't pay off your house. At that time, we were leading an FPU course and through that we became more accountable to

the Dave Ramsey plan and we became more of a team budget meetings were more of a joy than a burden or a dread and we were always exciting to me nerd free spirit let's just establish it and so um with uh with leading that class we decided all right we're gonna pay off the house but even at that point i was i was a supporter but i wasn't an equal partner in in the process so i wasn't really gung-ho about it until about february of 2019 when we had received a late advent calendar from our friends in Germany and we're all sitting in the living room floor pouring over these German chocolates and goodies when Josh said how would you guys like to take a trip to Germany which of course the response was

I bribed him I needed a bribe the response was yeah yeah we want to go to Germany and he said all right when when we pay off the house, we'll go to Germany. So at that point, we became full partners in this. So the interesting part, though, is when God came into it, the very next month, we had decided, obviously, to pay off the house. But whenever I was starting to do the numbers like I always do, I realized that that was going to be a lot of money to pay off $198,000 in about, well, it was January 2021. We're going to do it by January 2021. That was the date we decided.

And at that time, that February of 2019, we had $198,000 left in the house. And I was like, this is outrageous. How in the world are we going to do this? So I started talking to God and I said, God, if you don't mind, just give us more work. Not more money, more work. And that very next month in March, I had five coworkers that put in their notice to leave. Oh, my gosh. And I sat down with her, and I said, I'm not sure if God sent them out of my work, but it is an opportunity for me to get all the overtime I could.

And so I amped all my, every vacation I had for the last two years, every post-call day, which I have most of them off, I worked all of them. Many Saturdays I worked. And so I have not been part of Jeremiah's life pretty much. And so for that whole 18 months, it was gung-ho. And so God provided that opportunity for us, and we got it done in time. Wow. Actually four months early, I guess. Wow.

And meanwhile, we're learning German so that we can keep him accountable to his part of the plan, his bribe. I love it. Yeah, the kids are really— So that was a pretty heavy sacrifice, all those hours. It was. But now you're 35 years old with a paid-for home. Was it worth it? I would never go back.

Absolutely. The hardest part was just parenting is hard enough alone in and of itself, but parenting alone is even harder, and it felt like that some nights when I was the only one taking them in bed. Most of my hours were 16- to, 16 to 24-hour shifts. I mean, I'm working call and then getting up the next morning and working 10, 12, 16 hours. So it wasn't just like Monday through Friday, 7 to 5.

It was constant. But because we paid off our house, we were able to say yes to an opportunity that we would have just not even batted our eyes at. So August, September or August, somewhere around there, when I got the money, because I was waiting for it, when the money came into the checking account to be able to pay the house off, that morning when it came in, I got a call an hour later from my buddy

who went to anesthesia school with me asking me if I would like to interview for a job about 45 minutes away from my job now. I accepted the job pretty much a week later, and I'm now home with my family so much more, and I didn't really sacrifice my pay at all. I actually got a bit of a pay raise. Wow. Without the hours. Without the hours.

Without the hours. Wow. It's like a breakthrough. I actually feel like it was God saying, okay, you asked for the time of work, and now I'm going to close it out with another huge gift. Wow. And so we are extremely grateful to be here today. Here's the cupcake.

Here's some icing. I like it. He was faithful for sure. Amen. That's powerful, dude. And, you know, the way we know that's God, for those of you who don't know anything about God, is the timing is wacky. There's no other way to explain it. Coincidence is the basis.

If that just generally happened in the middle of this, then you can blame it on coincidence or something like that, if you believed in that kind of stuff. But this is like, I need some more work. Okay, here's some work. And I just finished paying off the house. Oh, here's the same amount of money for less work. And COVID never did slow us down. We picked up more hours during that time.

So it was a blessing. Oh, you guys, that's incredible. I mean, absolutely incredible. We will stand on the stage that are all ranges of age, but seeing young people without a mortgage payment like you guys, like that's insane. Absolutely insane. And it was. It was a short-term sacrifice, right? Like we don't always say to go gazelle in tents through those baby steps, but you chose to, which is great.

In that short amount, that 18 months, which, girl, three kids, I can't even. I know. I have it. I'm like the same as you. I'm like, oh, so bath time's the worst. Like, I know. It's so hard. Yeah.

But that short-term sacrifice, and now the freedom, the absolute freedom to even pull back more if you wanted, right? I mean, just nothing. It's awesome. And in the middle of that, somebody was leading Financial Peace University classes. What do you tell them in the class when they ask, okay, yeah, but you make a lot of money. What's the secret to getting out of debt? My dad has always told me, you're going to spend as much as you make. You're going to spend it in, for us, our priority was in the house.

But for a lot of people, it's things that they can't even really remember what they spent it on. So it's just being focused. You've got to determine a plan, and I highly encourage bringing your wife on board as well. It is a marriage. You can't do it alone. And once she committed with the Germany bri bribe once she committed there was nothing stopping so when you're going to germany well we were going to go this year but it's going to be 2022 because that's when this lady that we're friends with is going to get married so we're

going to be there for her marriage for her wedding awesome and now you'll then you'll have a thorough understanding of the german language by the time yeah oh yeah we'll be fluent all right bring the three kiddos in and introduce them their names and ages or what go on guys josiah is six jess is four and jeremiah's two almost two and we've got to we got to tell y'all a little bit about them so uh one day when i was gone josh took the kids and made a paper chain with them each link representing a thousand dollars that we had left on the house. And each time we made a payment, it was a family affair. We went through our ritual of making the payment on the computer as a family and cutting off

the appropriate amount of chains. And it was a great visual. It is a great visual. But now that I stand here on the stage, I think about how debt has you in chains. Count it down before we run out of time. All right. Let's hear your debt-free scream. Here we go in German.

Eins, zwei, drei. We're debt-free! Well done, you guys. That's as good a celebration as I've had in a long time. So sweet. Wow. Precious. Amazing. Amazing. Amazing. Well done. Well played. This is the Dave Ramsey Show. Our scripture of the day, Ephesians 4.29,

Let no corrupting talk come out of your mouths, but only such as is good for building up, as fits the occasion, that it may give grace to those who hear. Amy Poehler said, Lim limit your always and your nevers. Eh, I don't agree with that. Limit your always and your nevers. Is it too extreme? Limit the time you say always and the time that you say nevers.

Never. Unless you're just being a drama queen. But, I mean, there's some things you need to say. Never. How many times have you disagreed with the quotes? Almost never. I never disagree with the quotes. I always disagree with quotes.

Because they're like, I guess because she's saying because they're extremes. Yeah, that's what she's trying to say. But my point is that there are principles in your life that you should always stick to and some things you should never do. It's fair. I don't know. I wish I had an argument to play devil's advocate, but I genuinely don't. I agree with you.

One of your favorite sports is arguing with me, so this is scary. For the first time, I'm worried about you. We need to have your temperature checked. You're always fun to debate with. It's good. How many people push your buttons? I can push your buttons. Hogan and me argue all the time.

No. On the air live. Not like us. Yes, we do. Yes, we do. He makes fun of me all the time for being bald. Hurts my feelings. Okay.

I'm sensitive that way. Open phones at 888-825-5225 don't forget one week from today on tuesday january the 12th we will be doing the reset live stream it is a free live stream with chris hogan rachel cruz craig groschel and me it is time for you to hit the reset button it is time for you to get the step-by-step money plan to do the small things you need to do for 90 days that are going to show you how to get on track and get moving. We're going to lay it all out for you. So go to DaveRamsey.com slash reset, and you can check out the whole thing having to do with Ramsey Plus

and getting a free trial to it. And if you want to view the free Reset live stream to kickstart your money goals for 2021, text the word RESET to 33789. Text RESET to 33789. There'll be 100,000 to 150,000 folks watching that live stream that night. We've already got 65,000, and we have a week to go. And it's free, by the way. Tell people about it. Tell your friends about it.

They can start off 2021 with the best minds on the subjects of behavior and money, behavior around money, all of that. Amy is with us in Flint, Michigan. Hi, Amy. How can we help? Hi, Dave. Hi, Rachel. Hey, how are you?

Good. How are you? Good. How can we help? So I had in the spring, actually, right when COVID hit, I had an issue with mold in my house. I have since got it fixed, insurance covered it and everything, but I have been diagnosed with mold toxicity. So unfortunately, I am working from home and have been since about March, and I got a permanent position at home now. I have now found another mold spot in my house that has to be taken care of.

So I'm not really sure how to go about it. You know, my insurance mold coverage is maxed out. So do I take out a loan to take care of all the mold because my health comes first. I mean, I, they're talking maybe up to $10,000 worth of damage. And I'm just not sure exactly how to go about it because I, you know, I'm trying to follow your plan. I know that, you know, I don't want to be slave to the lender. I don't want to take out another loan, but I know that my health comes first. So I'm not really sure how to go about it.

Are you single? I am. What's your household income? It's about $36,000. And you obviously own this home? Yeah, I have two roommates. What's the house worth? Probably about $130,000-$140,000.

And what do you owe on it? About $110,000. about 110 so a ten thousand dollar loan when you make thirty six thousand dollars a year is what's known as a lot of money yeah okay well i i don't want to put your health in jeopardy and i don't know enough about you being diagnosed with mold toxicity. As far as I understood, we all have mold toxicity. So it's new to me that some people have it and some don't. I don't know. I'm not being smart. I just don't know.

I know it's not good for anybody is my point. And so if you've got a special level of sensitivity to it, which is I suspect what you're saying, then obviously it escalates the situation. I've been doing this show 30 years, and I've been put personally in a whole bunch of corners where it looked like the only way out was borrowing money, but I a long time ago gave up the idea of borrowing money. So I can't recommend you borrow money.

So I have to recommend something else because I wouldn't do it myself. And I especially wouldn't do it if I made $36,000 a year and wouldn't borrow $10,000 for the second go-round of mold on the same stinking house. I'd sell this house and move. This is going to come up again.

What are you going to do next time it's $10,000? I mean, this house has got a mold problem. Or for some reason it's got a susceptibility new area of the house amy like why didn't they fix it in the first place yeah yeah this is a whole new area that's what i would say i would say you didn't fix it well the insurance maxed out but you didn't fix the problem i had mold in my house

and now i still have mold in my house so like that's on them they they need to fix it in my opinion yeah i know but they had they had a certain amount there the insurance company had a cap your homeowner's mold coverage only went up to a certain amount yeah but that they need to explain that to her then to say we can only fix x amount it's like they didn't even find the other stuff well she knew she might you knew you maxed out your insurance on the first repair right yeah and i didn't find this new spot until um just last week yeah but and the point is though that it's um if ten thousand dollars is correct that was a pretty substantial miss rachel saying by the mold people i I mean, if there's a $10,000 worth of mold damage and you finished work just a few months ago, they missed something. Right?

It had to already be there. Yeah, this one was kind of hidden in the attic, and I don't know if they really did enough checking in the attic before. Yeah, they missed it. So, you know, I don't know what it means to your health if you can afford to live there for a little while without damaging your health i don't know that i don't know how to explain that i know that dave and sharon ramsey had a lot of different things come up that felt like they were impossible situations and we were put in a corner where we

had to make horrible choices uh but to avoid debt and never going back again, we made those choices. And now 20 years later, we're extremely prosperous because we made those choices. Well, and what it does, Amy, when you kind of make that line in the sand and you just say, no matter what, we're not borrowing money, that forces you to see other options. And then you get creative. And then you say, you know what, maybe I will just sell the house. Or maybe I'm going to get creative and then you say you know what maybe i will just sell the house or maybe i'm gonna get out and have the roommates help i mean you start to actually look

at different options versus just yielding to debt when you have that stance and so the fact that you're a little bit you're kind of wishy-washy a little bit in your question and maybe your career maybe you got to work on your career because you don't make any money. And, you know, you've got to work on maybe you're going to be working outside the home to make more money. And that would be okay, too, because your average household income is $59,000 in America. And I'm not picking on you. I'm not shaming you for what you're making. I'm just saying that long term, five years from now, what are you going to be doing that makes you $80,000 a year instead of $36,000? And you need to be aiming at that,

and that might be part of the fix for this $10,000 problem. It might be the extra job that you take on, and you go make $10,000 in a couple of months, and you work your tail end off over the next three months, and you make $10,000, and you pay cash for this fix. That's okay with me if you want to do that, if you can survive your health for those three months and you make $10,000 and you pay cash for this fix, that's okay with me if you want to do that. If you can survive your health for those three months. I don't know how sensitive this situation is.

But if it's super sensitive to where you're going to be seriously ill in the next 30 days, then you need to move and you need to put the house up for sale. And you need to not try to fix a moldy house all the time. Let's just move on. That puts us out of the Dave Ramsey Show and the books. We'll be back with you before you know it. In the meantime, remember there's ultimately only one way to financial peace and that's to walk daily with the Prince of Peace, Christ Jesus. This is James Childs, producer of the Dave Ramsey Show. On your smart speaker, you can add our skill

by saying, Alexa, open the Ramsey Network skill. From there, you can listen to all our shows. Ask Dave money questions like, how do I invest my money? Or what is the debt snowball? Find out more at daveramsey.com slash smart speaker.