The Ramsey Show - App - THIS Is How You Gain Financial Independence (Hour 3)

Episode Date: December 30, 2022

George Kamel & Kristina Ellis discuss your questions on money, work, and relationships. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving at Storage Studios, this is The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm George Campbell, joined by Christina Ellis this hour. This is your show, America, so call us up, 888-825-5225.

That's 888-825-5225. Reminder for those of you that enjoy the show, if you've ever found it helpful, we need you to do us a favor and go subscribe and follow wherever you're listening. Leave us a five-star review. Share it with a friend. We want to help and impact more people like you, and that makes a huge difference. We can't do this without you. We appreciate that. Anne kicks us off this hour in Green Bay, Wisconsin. Anne, welcome to the show. Hi. Thanks for having me on. Sure. How can we help? Well, me and my husband are on, we have four, five, and six, and I'm struggling with, we're struggling with trying to find focus for steps five and six.

Right now we're paying an extra 500 a month on our house, which will get us done with the mortgage in about five years. But we haven't checked the kids college off yet. Like we're doing a little bit and now I'm, we're just, I'm trying to do the math and figure out how we can do it and still make progress on our house because it feels so good to have an end, an end in sight for the house and the kids are seven and two and that just seems so far away, but it just feels overwhelming to, to save that much money for them to have college paid for. So I'm just looking for tips and advice on how to do that. Yeah, that's a great question. And balancing four, five, six can feel difficult because you're not sure how much to put towards one thing. It's a little bit squishy. There's no

parameters of you have to put this amount, like we say with investing. And that's because every situation is different. And so in your case, you do have a lot of time, but that means it's a great time to invest for them because that money has so much time to grow and compound. Right. So I think the balance is working with a smart investor pro and doing the math and going, all right, juniors too in 16 years, probably going off to college. So how can we make sure we have a big pile of money in 16 years?

That may look like $2,000 a year for the next 16 years and let that compound to close to six figures. Well, and just getting started in general, I think is going to be good, even if it's $25 a month for each kid. That's literally what we're doing. Our two-year-old is getting $25 a month and our seven-year-old is like $100 a month. And now I'm just trying to figure out, yeah, what more to do? Our two-year-old is getting $25 a month, and our seven-year-old is like $100 a month. Now I'm just trying to figure out what we're to do. How do we get to that? I'm just trying to get $100,000 in there by the time they're both 18.

And is it bad for the two-year-old? It takes like $200 a month to get pretty darn close to that. And then our seven-year-old, is it bad to just do lump? We should be able to get some lump sums with my summer gig. I don't know. I guess is it better to do monthly or lump sums? Think about this, Ann. Let's say it takes six years instead of five because we're investing a little more for the kids. Well, six years from now, the kids are going to be eight and 13 and you have no payments in the world. And so you have all of your income at your disposal to then save up and be able to help cash flow college. And so the fact you're even struggling with this tells me you're in a good spot. What's that?

Okay. Is that okay to keep paying off that? Because I could take that $500, that extra month that we're paying on the house, and put that towards the kids' college, but it feels so good to do that extra money on the house. Yes, because there's an end in sight that's a lot closer with the house payment, and you free up a payment. Saving for college, you're never freeing up any payment like you are with debt. Right, right.

Well, and I love that you want to help your kids with college, but it's also not an obligation. You know, that is a gift. And it's a wonderful thing to do. But it is still important for you all to take care of your finances and be in a great spot when you hit retirement age. So I definitely think you can do both in this situation. I think you guys are in a great spot to be able to pay off the house. And even if there's a little bit left at, you know, where you don't quite have enough saved up for the kids college, I think you'll be able to cash flow quite a bit of it. But there's also scholarships. There's also picking an affordable school. There's a lot of different ways that they can still go debt free. But I think you're on the right track to accomplish both goals.

What's your income household? 74,000. Okay. And I imagine that income will go up over time. So that's only going to help the situation. But when I'm looking at the numbers, I go, okay, $500 a month at the house, that's $6,000 a year? Yeah. Extra? What if we could fully fund an ESA for both kids?

That's $4,000 a year. So now we're talking we need to find $10,000 worth of margin every year in order to keep up with both of these goals. Is that reasonable? Yeah, that's reasonable. And I think that will give you some peace and confidence that you're on the right track and you're not doing too much in one and not enough in the other. Just set a goal in each area, find that 10 grand in margin, and make sure you're hitting that. And if you can do extra on top of that, that's only going to help both. And if you want to put that on the house for now, that's great. And then we can be more aggressive once the house is paid off and really ramp up the college savings.

Oh, okay. All right. Well, that makes me feel a lot better. That's what we're here to do. Just make you feel a little bit better, Rand. Thank you so much for the call. You're doing so great. I just want to encourage you in that.

You're in a great spot. Cameron joins us up next in D.C. Cameron, welcome to the show. Hello. I'm glad to be here. Absolutely. What's your question? I just wanted to know what are some strategies that I can use to become more financially independent? Well, tell us a little bit more about your situation right now. Okay. So I recently graduated college with my master's in business administration,

and I graduated in August of 2021. And I've worked from then up until now, and I've been able to save a good amount of money that I'm planning to use for a down payment for a condo or a townhouse in my area. And I've just started a new job, and that's where I'm at right now. What's your income? It's $55,000 a year. Okay, and how much debt do you have? I'm fortunate that I was able to graduate with no debt. Good job.

So no debt, and you have a pile of money. How much money do you have in the bank, liquid cash? I have about $10,000. Okay, and that would be considered your emergency fund? Is that about three to six months of expenses? Yes. Well, I live at home with my mom now, so yes, I'd consider that. Well, let's call that $10,000 your emergency fund because we know you're not going to be living there in the next few years, potentially.

Yep. So any money beyond that $10,000, now we can start to use to invest wisely to save up for that down payment. And it sounds like your next goal is to get in a condo or house and buy some property. Yes. And if you're going to do that, the way to do it is to save up a big down payment and culture will tell you, hey, put as little down as possible and it'll be okay. The problem is it's really hard to be financially independent when you have a giant pile of debt hanging around your neck. Right. And you know what it's like to live debt-free. You don't have payments, which means

all of your income stays with you. So the more you can use that wisely to stock up a whole bunch of cash to get property to then pay that property off, that is the path to financial independence. And you've done such a good job so far. The fact that you got an MBA with zero debt, that's a great accomplishment. So I encourage you to keep that debt-free mindset going forward because a lot of people get that great job and they're like, woohoo, let's buy a house. Let's buy too much. But keep that mindset. You're doing a great job. Yeah. Keep living with your parents for another year, stack up a whole bunch of cash, and maybe you'll have a down payment. And then I want you investing 15% of your income. And that's the key. Culture will tell you financial independence looks a lot different, but the baby steps is the best path to do it. So make sure you're following

those steps. Don't waver. Don't fall for a TikTok real estate investing scheme. Stay the course, my man. This is The Ramsey show we're taking your calls at 888-825-5225 next up we have Bill calling from Midland, Michigan. Hey, Bill, welcome to the show. Hey, how's it going? Hey, great. How can we help? So thanks for everything you guys do. I've got a question. My wife and I are debt-free aside from the house, and we're on four, five, and six right now. We both own our own businesses. And so we sold our previous house last year and we were able to put everything we made on that one

onto our current one and only had to take out a loan for about $60,000. And I bought a $210,000 purchase, which was awesome and a huge blessing. But so I feel like, and I think that we can pay off said house by December of this year. If we keep saving what we're saving currently and, um, talk to my wife about it. We only owe a balance right now of about just over 49,000 on it. So we've been paying extra on it too. And, um, had a conversation with her the other day, laid it all out and showed her and she was on board with it. And she was just like, she's like, I'm, I understand where you're coming from and it's cool. And I'm on board with it, but I'd like to talk to my dad first together just to make sure it's a wise idea because her dad's a CPA.

And I did all this prefacing the fact that I respect my father-in-law a lot. We have a great relationship. I respect his opinion, but he's also not necessarily like, you know, that stay out of debt care kind of guy, you know, like he buys,

he kind of like, he bought like a car on loans every couple of years, carries credit cards, which to each their own, like whatever. But I feel like we're on different levels of that idea. And so I was like, well, I'll talk to him, but I probably already know what he's going to say. And so we had the conversation and he was like, well, I don't see the point of paying off such a small loan with such a small interest

rate. And you could just save up cash. I was like, well, I feel like we could pause our investing for a couple of months in order to do this and then restart the process of that. He's like, well, I wouldn't invest right now either because the market's crap. And I was like, well, what would you do? You wouldn't pay off the house and you wouldn't invest. And I was like, well, what would you do? Goodness gracious. You wouldn't pay off the house, and you wouldn't invest. And he's like, I'd just pile up cash. I was like, but we've done that.

And so my question is, what should we do? I think you switch the conversation to football and politics, and you do you when it comes to money. Now, does your father-in-law pay your bills? Does he pay your mortgage? No. Okay, just wanted to make sure. And I'm right there with you.

Like, he has an opinion, but his opinion is not the final vote. Yeah, I can have deep respect for the man. I can love him. Same thing with my dad. You know, we talk money, and I get frustrated, and we change the subject

because we are not going to agree, and I say, thank you for your opinion. We are not taking a poll at this time. What's for dinner? You know, And so I think that's the relationship. Well, my whole thing with it too is like, so there's a kind of a two-parter is like, yes, it'll take out a lot of our savings, but we'll still have an emergency fund left over if we wait till December to do this, because we'll have at least five months of savings saved up and then we'll be able to save that money right back up. Plus then, you know,

the house team at every single month. Yeah. And we both own our own businesses. I'm my wife owns a CrossFit gym and I'm a massage therapist. So aside from pandemics and whatnot ever happening again, like physically, I don't know when my last day of work is ever going to be. And I make good money right now, so I'd rather get everything paid off now while I make good money so that later I don't have to worry about that when I need to take a different job. That's a great mentality. On top of that, Bill, I would not pause investing.

So if you're doing 4, 5, and 6, you're investing 15%. If you've got kids, you're putting some away for college. And then anything left over, we're throwing at the house. So I do agree. If you want to go down to four-month emergency fund and put the rest on the house and get this thing paid off, man, you're going to sleep better. And your father-in-law, while probably a lovely person, doesn't get a vote when it comes to what you do with your money. Well, you guys are so close to the finish line. Like a December payoff, that is going to be a debt-free house that you're going to keep for years moving forward. So when you guys are so close to the finish line, like a December payoff, that is going

to be a debt free house that you're going to keep for years moving forward. So that's just going to let you walk on that freedom. And I think you're right as a business owner, that security that comes from having no mortgage, no payments in the world. It's just it's going to change the way you approach business. It's going to help you feel so much more free. So, yeah, I agree. Football, maybe politics.

Maybe politics. I don't know. I personally, yeah, I agree. Football, maybe politics. Maybe politics. I don't know. I personally wouldn't. I stay away from all of that. I stay away from both, honestly. Sports, politics, I know very little about either. I'll stick to money. Money.

We might need some more conversation topics, George. That's true. All right. Next up, we have Dave calling from Jupiter, Florida. Hey, Dave. Welcome to the show. Hey, guys. How are you doing today? We're doing great. How can we help?

I had a question about renter's insurance, if that was something worth purchasing. 1,000%. Get it today. Yeah. What made you not want to get it? A lot of places require it it but it depends on where you're renting yeah well it's actually uh well it's not for me personally my sister she lived on uh she lived in fort myers uh of course there was the hurricane that just blew through there um and so she's looking to locate over here to the east coast of florida close to me and she's needing to rent something and she's more so looking, I guess the owner of the house that she was renting didn't have flood insurance. Apparently there's a lot of people

who don't have flood insurance in Florida, so it's new to me, but she started asking me about renter's insurance and I had no idea about renter's insurance, so I figured I'd ask you guys for your advice or even if that covers anything like flood damage. Well, most of them don't. You're going to need to add that onto the renter's insurance. And so you can have her contact Xander Insurance through our website, Ramsey Solutions, and she definitely needs renter's insurance today. And it covers a ton. I mean, it for sure will cover fire, hail, lightning, theft and vandalism, windstorm, plumbing system freezes, a vehicle hits your house, someone gets hurt in the house. It covers all types of things. And it's super cheap. I mean, you're talking 10

to 20 bucks a month for most of these policies. Now, I don't know with Florida. I know it's been crazy with the hurricane and floods and people can't get insurance. They're having to pay crazy, crazy amounts of money to get covered. But it's just part of the deal if you're going to live in one of these areas that are prone to flooding. So definitely get it covered. But it's just part of the deal if you're gonna live in one of these areas that are prone to flooding. So definitely get it. Yeah, it's so important. That's great that you're having that conversation with her

because there's a lot of young people that have no clue. They get out there, they get their apartment, they think that if that was required, it would be part of your signing. They think their landlord's insurance covers their stuff and it doesn't. And Dave had this happen to one of his tenants way back in the day and there was a fire. And they said, okay, when do we get our check for all of our stuff? And

Dave's like, that's not how it works. I legally can't even do that. And so they, I mean, it was a hard, stupid tax they learned and a really sad one to not have renter's insurance in place. And so if you are a renter, part of the deal is you get renter's insurance. And a lot of apartment complexes require it. Well, when I was renting and some landlords should. I feel like if you're a landlord, please require your renters to get it because it protects you and of course your tenants. So this is a A1 you got to get in place. And our friends at Zander can help you out and make sure they will shop independently all of the best companies out there to find you the best rate in your area. So I highly recommend doing that today. Yeah. And having those conversations, it's so important. I mean, I know you've talked a lot about insurance and just doing a checkup overall. I think it's important. It's a good call out to just, I mean, renter's insurance is important, but there's a lot of different types of insurance that people need to make sure that they have in their life that they have covered. And it's not something that usually comes up over like, you know, dinner.

The happy hour. Right. Stock runner's insurance. Well, we did a free five-day walkthrough called Confidence in Your Coverage. You can sign up for that at ramseysolutions.com slash confidence. And every day for five days, there's a three-minute video from me, and I'm breaking down a different type of insurance. I promise you, I at least attempted jokes.

I mean, it's insurance, so like I get it. But if you don't enjoy it, you get your money back and the check is going to be exactly worth what you paid and it's zero dollars. So ramsaysolutions.com slash confidence. If you want some weekend plans, you can start to tune into those videos, Christina. I know that's what you're itching to do. Well, you don't often hear the word jokes and insurance in the same sentence, but if anybody can make that work together, it's you. I tried my hardest. I'm like, we need to make money fun at all costs. And if that means me trying to make a dumb joke that even gets your brain to go, gosh, that joke was so dumb. I feel like at least you're paying attention. So if you need some entertainment around insurance, y'all check it out. There

you go. We'll be right back. This is The Ramsey Show. are you sick of planned obsolescence you, when companies make products crappy so you have to buy more of their crappy products? Well, me too. And it's why I love companies like Grip6. Grip6 is all about quality products meant to last forever. That's why their comfortable, bulk-free belts, slimline wallets, and lightweight wool socks all come with a lifetime warranty and simple returns and exchanges. So check them out at Grip6.com today and get up to 20% off with the promo code Ramsey.

Welcome back to the Ramsey Show. I'm Christina Ellis, joined today by my co-host, George Camel. We're taking your calls at 888-825-5225. Next up, we have John calling from Los Angeles, California. Hey, John, welcome to the show. Hi. How can we help? I had an insurance question, life insurance. I'm 70 years old and I have a term life insurance policy that's good until 2025. And it's costing me about 200 a month.

And my financial advisor said that I should get a whole life insurance now while I'm still 70 instead of waiting until I'm a couple years older. And it's going to, I've already applied for it and I can get it, but it's going to be like $1,165 a month. And I was just wondering if it would be better to hold off, let my other term life run out, and then try to get another term life or to try to get a whole life. Did your agent quote you for another term life or did he just offer you whole life? They just offered me whole life. Can I tell you what's actually going on here, John? Pardon me? Can I tell you what's actually happening here? Yeah. Your financial advisor is just a whole life salesman. And the reason he's pushing whole life is because he's making a giant spread on that premium. And he's going to make very little comparatively on a term life policy.

Yeah. The fact that he didn't even offer you or quote you the term life is a pretty big red flag. So tell us a little bit more about your financial situation. Do you have any debt? I have a house payment. That's the only thing. What's in retirement? I have Social Security and a retirement from the IBEW. Okay. What's that amount to? It's not a lot. It's only about $3,800 a month. Okay. So the idea with term life is that by the time it's over,

you're self-insured and you'd be able to cover any costs. So if you don't have that ability to cover those costs, I would still steer you to another term life policy, even though it's going to be expensive, but it still won't be nearly as expensive as that whole life policy. Right. That's what I was thinking. I'm just, he's trying to tell, and the whole life that they're talking about is 300,000, and the term that I have now is $500,000. Yeah, it's because Whole Life sucks, and it's super expensive. And as an example, a $250,000 policy might cost you $260,000 a month on your premiums with Whole Life.

But with a term life policy, it might cost you $13 a month. So it's astronomically cheaper for the same amount of coverage. And the money you save, you can invest the difference if you've got it. And whole life is terrible because it tries to do two things at once. It tries to be an investment vehicle and an insurance vehicle, and it ends up not being great at either one. So if I'm you, honestly, in your shoes, I'm firing the financial advisor and saying, hey, it's been great working with you.

Sayonara. And you can go connect with a better financial advisor called SmartVestorPro at RamseySolutions.com who isn't going to steer you towards these crappy whole life policies. So wishing you the best, John, with these decisions, but run far away from this. Yeah, that's... It just breaks my heart when financial advisors who you go to because you trust them with your biggest life decisions and your biggest money decisions steer you to these crappy products all so they can get a bigger cut. That's just sad. It feels like such a cash grab.

But thank you for calling. I'm glad you did have that gut check that made you go, this just doesn't feel right. Thank you for that, John. Hopefully we talked him off the ledge. Up next we have Julie calling from Chattanooga, Tennessee. Hey, Julie, welcome to the show. Hi. Hey. So, I'm going to jump right in. So, I'm working two full-time jobs right now

and physically just kind of feel like I'm killing myself. So, I'm wondering, does it make sense to pay for a certification and go through some training that would allow me to take an online job, even though I'm still dreaming in debt and all of those things? Well, how much debt do you have? About $60,000. Okay. And what kind of work are you doing right now with these two full-time jobs? So I am a teacher and then I work in a factory at night. Wow. You are hustling.

Those are not easy jobs. No, no, they're not. No wonder you feel tired. What's your total income from those jobs? My total income is about $60,000 with those two. So if you were to go back to school, what would you want to study? Well, I have a degree already in business administration, but I was thinking if I go more for a certification, not in a college, either something in accounting that would allow

me to do that or something in web development, maybe back end web development. I mean, that's definitely a possibility. I mean, have you looked into jobs that you could get right now without an extra certification that are outside of teaching? Well, the teaching job is the one that I really want to hold on to. It doesn't pay much of anything, but it's kind of what makes me human. So I want to hold that. Hey, we need more people like you in the world. God bless the teachers. As a mother, I am very concerned about the education system.

So thank you for what you do. Well, thank you. So this extra job, are you looking at another full-time job that's basically online? Yeah, maybe full-time. I think part-time I could probably do, but it would slow down any process of getting rid of debt for sure. Yeah. Have you looked at the price of the certification programs? Not really, no. I've looked just a little bit here and there, but it would take a lot of research to figure out, you know, get past just all the advertisements to get to what's real.

Yeah. Well, I know that there are some pretty affordable ones right now, and some are even free. I know that a lot of companies like I believe Google's got a really cool program right now where they'll train people for jobs that they're that they have in demand and they'll train people for free. So really, I mean, with a business administration degree, I mean, there's a lot of possibility right now to look into potentially a very low cost or free program that could yield a pretty cool job. Yeah, and I'm gonna give you, Julie, Ken Coleman's Get Clear Career Assessment to help you figure out exactly what the path is because you mentioned a few options there and I want you to not just do the one that pays the most but do the one that you're also passionate about

and I think you can make great money doing the thing that you love and that's what our friend Ken teaches every day. So we're gonna give you that. It'll take you about 20 minutes to go through, but that will help steer you towards the right direction. What kind of debt is this, the 60K? So it's a pretty even three-way split with student loan, a car, and then just credit card, no junk debt. Okay. Have you cut up the cards? No, but I don't use them.

Then cut them up. That's a great way to never be able to use them. It can become a crutch when you fall on hard times and you go, well, at least the credit card companies are there for me, except they're not because they're there at 22% interest, keeping you in debt longer and longer. So cut those up. Would you consider selling the car? Is it worth more than you owe? No, it's not. So I actually just bought out my sister's lease, which was the cheapest way to get a car, because our other car didn't have air conditioning. We fixed it several times, and then it goes back out. We were just kind of draining money.

So I'm not sure that there's really a better option for me to go for right now. So what's left on the car loan? We just did that, so it's right at 20. Okay, when you say we, who is involved here? My husband. Okay, is his income factored into this? No, it's not. So is his income not helping pay down this debt? Yes and no, we're not organized. We're all over the place. And so we still feel like we're living paycheck to paycheck, pinching the pennies. Yeah, that's the real crisis here, Julie. I'm going to be honest. I'm going to put you guys through Financial Peace University on us if you're willing to do it. Is he on board or is he kind of skeptical towards this whole thing and

going, well, that's your debt, not mine? What's his attitude? Well, we share our finances. We share the finances, but I'm really the one who manages it. And so I think it's, he doesn't feel all the stress that I do because it's easier for him not to look at it as intently as I do. So you're carrying the brunt of all of the stress and burden and two full-time jobs. And he's like, well, she manages the money. I guess. Oh, Julie, Julie, Julie.

All right, we're going to gift it to you. I hope that you guys go through it, have a serious conversation and go, I'm not okay. I'm scared. I'm tired. I'm burnt out. I need you on board in this marriage.

And if he's not willing to do that, we got bigger issues and counseling needs to get involved here. Yeah. I'm so sorry, Julie. That's tough. And y'all are just running so fast right now, taking the time to slow down, get educated,

get on a budget. That alone is probably gonna save y'all so much. Hang on the line. We'll get you the Get Clear Assessment and Financial Peace University. We're cheering you on. This is The Ramsey Show. Our scripture of the day, 1 Peter 3.8. Finally, all of you, be like-minded, be sympathetic, love one another, be compassionate and humble.

Maya Angelou said, My mission in life is not merely to survive, but to thrive, and to do so with some passion, some compassion, some humor, and some style. Ooh, love that. Love that from Maya. Good stuff. That's awesome. All right, to the phones we go.

Javier joins us in Phoenix. Welcome to the show, my friend. How are you doing? I'm good. Thank you for taking my call. Yeah, what's going on? So I just had a question. So me and my wife were pretty much on baby step two.

We saved a thousand dollars and we started snowballing our debt. But the question is, should I put that on hold and just try to focus on just raising more money? I had a drunk driver crash into my house about two weeks ago. Oh my goodness. Yeah. Told them, told them my wife's vehicle. So instead of having the two vehicles, we're down to one. Luckily for her, she works from home,

but we still have to get the kids to school and then back from while I'm at work. And no one was injured. No one was injured. Thank God. Yeah. No fire in the house, no water damage.

It's just basically like, I guess you want to call it cosmetic. He came straight bailing through the front door pretty much. Oh, wow. That's scary. And that damaged your wife's vehicle? So it was a total loss of my wife's vehicle. And so what we got, I mean, it was nothing brand new.

We had a 2012 Hyundai Tucson. And with my fault, because the driver who crashed into us didn't have no insurance. So it was basically all on our insurance. Luckily, we had we have full coverage so you know we we got it paid out but i guess with the comps around town and because of the year and the mileage um they only gave us about seven grand after deductibles um so should i put on hold trying to rebuild our thousand dollar emergency fund and the snowball debt to try to make up the difference to get something close to that same year and model. How much is it to replace the car? You said they gave you $7,000.

How much would it be to get it? They gave us $7,000. But, I mean, just the size of the family, we're just trying to find something like a crossover because we have a sedan. We had a sedan, so we're trying to find a crossover, you know, like to just kind of sponge everything because more than likely, once they start construction on the home, we're going to have to leave. And it's just basically depending on where we go, we might have to be taking the dogs back and forth to either my sister's or my father-in-law's house. So I need something

big enough to get the dogs in there. Okay. How much money do you have in the bank right now, aside from the $7,000? Right now, apart from the $7,000, I probably got maybe like $500 in my little side account that I have for savings. And how much debt do y'all have? Well, we just have the house and we have maybe one credit card. That's probably like about, um, about 2,500. Okay. So that would be the only thing in your debt snowball is that credit card? Yeah. And then we'd be moving on to two credit cards, but that's like the total amount and we're almost done with the smaller one. Okay. And then what's your income? Uh, my income, I want to say I make about $40,000 a year, and then my wife is probably just under me.

So she's probably like maybe $36,000, $38,000. So about $75,000 a year gross income for both of you? Yes. Okay. So how quickly can we save up another few grand and get a vehicle? I'm hoping within like a couple of months, because I do have a part-time job, but it's only one day a week. But I mean, it is a full eight hour shift that I'm getting on there. Okay. On top of my Monday through Friday, and then she's

just Monday through Friday. So if you've got $7,500 to your name, I'm going to put away $1,000 of that for the starter emergency fund, which leaves you $6,500, and that becomes the car fund, and we are going to get a car next month. And if it's not the dream car, that's okay. We can always upgrade later and sell that one and upgrade to the bigger one. Right now, we can't be super picky. Yeah. And you're going to be in a very different place six months from now. I feel like I've got to explain to my wife.

My wife doesn't get it. She's like, we need something. We're not getting anything older. We need the same year. And I'm just like, I just can't get it she's like I we need something we're not getting anything older we need the same year and I'm just like I just can't get through to her on that part so I'm just mentally she's stuck on she wants that exact car and now that car is 10 grand instead of seven yes exactly yeah so let's see can we save up two grand in the next month and just sell as much as we can work as much as we can extra shave our expenses as much as we can so that we can expedite this process, get that vehicle.

Then we're going to focus on getting back to the debt, paying off the $2,500, cut up the cards. We're closing them. We're not going to use them anymore as our emergency fund. And then we're going to focus on getting a fully funded emergency fund in place so we never have to deal with this kind of stress again. Yes. That's exactly what I need to do.

But it's just weird because I feel like sometimes, like, she doesn't see my point of view. And then I tell her, like, well, Dave Ramsey. She's like, oh, I don't want to hear about this Dave Ramsey. Well, that's, yeah, that's not going to get you where you want to go. Well, and I think it's important to just acknowledge that she's probably grieving this. Like, this wasn't just, like, her car broke down. This was a big deal. Somebody came onto her property and wrecked

and she lost a car that was, you know, she liked, she was happy with that car. And so this is a lot to process for her. So I think just giving her space and time to grieve a bit while also making the right financial decisions could be helpful. Just acknowledging just how big of an emotional thing that is to overcome.

I think the numbers, I think what George said is great. You can find a big vehicle for $6,500. I mean, it's not going to be the most glamorous vehicle. It may be an 09 instead of the 2012. Okay. Yeah, but it's both and. It's doing the right financial decisions, but also giving her space to grieve and acknowledge those emotions

and kind of work through and process. Because having what y'all went through happen where it affected your house, it affected your car. That's a huge deal. Yeah. And we're going to gift you one year of Financial Peace University. I want you and your wife to sit down together, watch all nine lessons. I think that will get you on the same page and it will turn Dave's name from a cuss word into a happy name. Yeah. That's what we want for you guys. So hang on the line. Austin will pick up. We'll gift you that Financial Peace University. Thanks. Well, and it'll help you see the future too, because right now it's like this moment is so heavy, but going through Financial Peace, you're going to be able to see the why of the $6,500 car right now. Get a bigger picture. Yeah. That's good. All right. Ashton joins us up next in

Springfield, Missouri. Ashton, welcome to the show. Hey, guys. I want to just say God bless you both. It's an honor. Oh, thank you. What's going on? So, long story short, I'll make this quick. I know I believe I'm one of the last callers. Me and my wife just had the privilege to pay off all our debt this past may and god is so good man way to go awesome she uh she's a mini christina let's just say that we love to hear it she got driven she got her whole entire um bachelor's paid for through a scholarship to where um i mean she's got i mean god bless that that's amazing but i was the knucklehead and took out the student loan.

So I was $36,000 roughly in debt. Oh, me too. You paid it off in 17 months. That's so great. Hey, join the party, man. But it's gone now. Yeah, let me get to the question. I apologize.

So now that she's in grad school, she's going to doctor of physical therapy school, and she's also getting all of that paid for through a scholarship. Way to go. I know, it's incredible. She's a part of a Native American tribe, and so there's a lot of opportunities out there for those that may not necessarily think they can. Yeah. And so I just want to put that out there. Okay, we got about less than a minute. What's the question we can help with today? Here we go. Sorry about that. So there's going to be clinical rotations on her last year of grad school. And so that's a lot of traveling for different locations within nine months. Should I start investing now? Should we pile up cash for that storm or should we do a little both? How old are you? I don't have any housing right now. I'm 25. I just turned 25, and she's 23.

Okay. I would say to pile up cash for the next year and see what life looks like. You guys have plenty of time to invest, and that'll give you guys some peace while she's in school and we're figuring out what the next steps look like. Beyond that, yes, we can split the difference. We can start saving up a down payment. We can use that cash towards that. We can start investing and fully fund a Roth IRA if we're in a good spot with a down payment, depending on the home that you're looking at. And so I think you go about this with wisdom and we don't know what her income is going to be either, right? Right, right. We are daily listeners, so we're all in. We've been all in. And so I figured you'd say that. So I just wanted to get a verification.

We're not surprising around here, Christina. You pretty much know what we're all in. We've been all in. I figured you'd say that, so I just wanted to get a verification. We're not surprising around here, Christina. You pretty much know what we're going to say. Y'all are rock stars. Way to go. That's awesome. I feel good about your future. She is incredible, guys. I married up for sure. That's the only way to do it, my man. We love to hear it. Well, that puts this hour of the Ramsey Show

in the books. My thanks to my co-host, Christina Ellis, all the folks in the booth, Austin, Ben, James, Zach, and Andrew. And you, America, we can't do this show without you. We appreciate you listening in. Until next time, spend wisely, save intentionally, and give generously. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube. Go watch and subscribe to the Ramsey Show channel on YouTube.