The Ramsey Show - App - This Is the Essence of Debt (Hour 2)

Episode Date: May 9, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Ken Coleman, number one bestselling author, host of the Ken Coleman Podcast on the Ramsey Networks. He's my co-host today. Open phones at 888-825-5225. Jordan is in Columbia, Missouri. Hi, Jordan.

How are you? I'm good, Dave. How are you? Better than I deserve. What's up? Yeah, so my burning question is that I'm getting married here shortly. I've got a good chunk of cash saved up. We're looking at getting into the real estate market,

but we'd like to know before we start having kids what the lowest risk method is for what we have in front of us. You're talking about your home or a rental property? Rental, building spec, and sell. It's a toss-up in the air. I'd really like to know kind of what the best... But you own a home that you live in. We are actually currently building a house that we're about to start living in. Oh, okay. Good.

Okay. And is it paid for? We're going to have about a $40,000 note. The rest will be paid in cash. Good. Okay. First thing I'm going to do is pay that off. Okay.

Okay. Now, then when I've done that, then what type of real estate? Now, there's real estate investing, which is a buy and keep it idea. And then there's real estate speculation, which is why they call them spec homes. If you're building a spec home, it's a speculation that you can sell it it's a short-term play it's not a long-term play it is speculation flipping houses is speculation and um both are high risk because obviously uh if you pay cash for them it's not as much risk but if you pay cash for a house fix it up and flip it uh if it doesn't flip, at least you're sitting there with a paid-for house, right?

You figure it out. You could rent it or do something else. But you need to separate the mentality of what is the lowest risk. The lowest risk is a buy-and-hold strategy because real estate goes up over time. When you have to sell that spec house or your money's sitting there burning taxes, property taxes, it's burning insurance, even if you don't have a note on it, it's sitting there burning money until you sell it, whether it's a flip or an actual build of a spec house. But that's speculating is short-term, investing is long-term. Now, when you go to investing, probably the entry point would be a good home single family home in a solid

neighborhood not super expensive but also not trashy okay that's the lowest that's the lowest risk okay okay can i can i ask you this as well sure Sure. So where we live, there is a lot of inflating house prices, if you must. So there's not a whole lot in the market below the $250,000 range, probably within a 15 to 30-mile radius. And so with that, I actually work for a builder, and so one of the initiatives that they've talked about but I'd really like to do is maybe build a cheap speculation home to sell to a lower-income family simply because I have the high confidence that it would sell quickly just because there's nothing really in the market for it. What's your thoughts?

That's just a side hustle. That's not an investment okay it's just your side hustle is you're building houses that you flip okay and that's not bad if you're paying cash for it um and if you've analyzed and said okay what are all the downsides so what happens and you got to be able to answer this question and not throw up what happens if his house doesn't sell for a year after you finish it spend a lot of money okay i'm just saying you gotta you gotta be ready for that because i don't know i don't know what's going to happen i don't i mean i'm i think you probably do know the market you're probably right in most markets in america if you build something less than the median house price in the area you have a very marketable property

because entry-level properties are just non-existent they're very hard to find and so any just about whatever the median price is and you sit in your area it sounds like it's two 250 then there so if you build something that 150 range that's a nice little home man it'll probably go fast yeah yeah yeah i walked through i walked through one uh that's about uh let me think how far it's probably 80 miles or something like that outside of nashville so it's out in the country okay uh down there one of my lake house there's a guy building a house on the corner up there and i walked it one day and he was in there and i walked it with him i was like wow this is a nice little it's a 1750 foot little three bedroom okay three bedroom uh bath and a half uh two car garage and and not

super fancy but it was it was well built nice little brick out a little brick and uh siding house right and it was 188 grand it was unbelievable i thought wow this is this is like all these people are here you're a cab by well yeah you can't but i mean it's out there it's out in the country you know it's not and where you are you're probably in a similar feel um uh you know in the columbia columbia is not a huge town uh and you know there's not a there's a whole bunch of columbia-esque size towns around you but you got to get all the way to St. Louis or Kansas City or even Jeff City before you get to a major town, right? Right.

And so you got a lot of rural rings around you, if you will, that could fall like that little house I'm talking about. But that was a sweet little house and not a bad. I mean, I'm thinking a young couple coming in there or somebody wanting to downsize a brand new everything, of course, dishwashers and all that stuff. And it's like, man, I could live there easy when we first got married and called that a palace, you know. But again, it was it's freaking hour and a half or more to Nashville. So and in this area, that's that's considered a crazy commute so uh but my point is that if you get below that median house price and that house sold i mean before he broke ground on it probably i mean he sold that thing so fast um but um that that was a it's a that's a great place in the marketplace

so i think what you're talking about makes sense is my point but i'm not an expert on your particular market um but the uh but but that's a that's a good place to be if you told me you wanted to build million dollar houses in a 250 market as spec i'll tell you don't do it um because you're going to get you're going to get into get end up with a million dollars sitting there but that's not what you're talking about so i do you have a temperature for, whether it be renovate something or build something brand new? And he's in the home building business. He's got the itch. He's going to build,

right. He's going to do it. I think you're right. I would tell most people not to do it, but he's in the business. I agree. And to your point at that price range, I would imagine they're going to have a lot of people trying to get in that

house. If he builds it at the right price. Oh yeah. Yeah. I mean, there'll be a line around the block, I suspect. that that's the again the point is this um it's not really starter housing but it's it's it's you know anything below the median price point yeah the median meaning middle okay the middle of your market the median house price nationally right now, I think it's about, it's bumping up close to 400. And so forever, what's it saying? It says 394. Oh, there we go.

Almost like I knew what I was talking about. Yeah. Okay. That's impressive. Yeah. Okay. So let's call it 400. Yeah. Well, that was the listing price. The median sold price was 288 in Columbia. Oh no, that's Columbia. Columbia's Columbia. I was talking about nationally. Oh, sorry. I was pulling up his area. Nationally would be over $400. Okay. I'm probably wrong. Sorry. I went to Columbia. That's okay. Good place to go. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever to get anything approved through the bureaucracy.

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have learned over the years, but it's not stuff I have taught. So if you want to do an advanced investing class, it's $199. We've got, I don't know, three or four thousand already signed up for it. Thank you for coming. We appreciate that. And if you're interested uh it's ramsey solutions.com slash events and that's dave ramsey's investing essentials we'll be taking uh questions live throughout this uh class as well and george campbell's going to help me with the whole process because he knows how to interrupt me and so and answer a question and all that so we're going to do that it's going to be fun. We've already been talking about it and laughing out loud as to how much fun it's going to be.

But George is always fun. Oh, he's hysterical. Diana is in Philadelphia. Hi, Diana. How are you? Hey, guys. I'm good. How are you?

Better than I deserve. What's up? So my question is, my husband and I are deciding whether we should buy a new car or not. We are looking at used. The situation basically is right now we both have vehicles. My car, I have a $350 car payment on. My husband's car is paid off. It has about 100,000 miles, and it is out of inspection. It has no air conditioning. It needs about $4,000 worth of work. We do have two young children, so we do rely on that vehicle as well for transportation. So my question basically is where...

If it's out of inspection, does it have a tag on it? Yeah. So when I say it's out of inspection, it's as of this month. So it's something where we're coming up on about, you know, should we pay to have all this work done to keep it, you know it inspected and legal after this month is up? Or do we go ahead and proceed with starting the process of looking for a new car, a used car, or something along those lines? Okay. You don't have any money, do you? So we have money in savings.

How much? We have about $20 have money in savings how much um we have about 20 000 savings okay all right so um the first thing is i'm just calling bs on the 4000 i think you cooked that number because you wanted to get rid of the car so i think you can actually get that car fixed for probably half of that if you start working on it a little bit but you jacked it up because you're sick of it and you're trying to figure out a way to justify getting a car if you want to get a car it's okay get a car but um I don't think it takes four thousand dollars to get that car back up and get it running to where it should be to pass inspection I think you can get a different mechanic to look at it somebody that's not I don't know where you went some don't go the dealer to get a car like that worked on for sure.

But anyway, let's figure out exactly what's wrong with it. Because here's the problem. If you don't get it where it passes inspection, it's going to sell for $4,000 less. Okay, right. You can't give it away. Yeah, because that was the other thing is if we traded it into a dealership versus sell it privately to have that fund as a down payment. Yeah, you can't.

Well, you've got $20,000. So, you know, I think you probably get the car up and running and where it'll pass inspection for a couple grand and then sell it. And then if you want then sell it and then if you want to sell it and move up in car a little bit with some cash that's fine but buying a new car no you're broke you don't have money for a new car and you certainly don't need a car payment and you need to get your car paid off as fast as you can okay yeah you got to get out of the car payment business kiddo if you don't want to be broke your whole life if you want to folks if you want to be middle class the rest of your whole

life keep a car payment mathematically it'll just hold your butt right there it'll just keep you from succeeding it'll keep you from prospering and just go well everybody's got a car payment it's just the way it is car payments are just the way of life and that's exactly how people that are middle class speak and talk and think and it just keeps you right there it just locks you in you cannot get it you can't break free from it and so you got to go nope i've had it not paying payments on a stupid automobiles ever again and these are the words of rich people people that become wealthy are the ones that get rid of car payments and i could get rid of my car payment if I was wealthy.

No, you missed the point. You could be wealthy if you got rid of your car payment. You got that backwards. So, now, Diana, that's the cycle I want to break in your whole discussion. I don't care if you fix this car up and sell it and move up into a little better car. It sounds like it's a piece of junk. I don't disagree with you on that. But then we need to get your car paid off as fast as we can,

and we need to get in a game plan here where we stop talking about cars as if they're a constant crisis and instead get around in front of it and start managing the vehicles in a way where uh where we don't where they don't own us we own them and that that requires a different thought pattern then oh oh well we're screwed we got to go get a car payment and um we're we're screwed. We've got to go get a car payment. And we're stuck. Can't get an inspection. Got to go get a car payment. And that's kind of how your question sounded.

Maybe you didn't mean it to sound that way, but that's kind of how it sounded, and you want to break that cycle. And I'm old school. I didn't have time to pick it apart, but I'd want to know what repairs are necessary just to pass inspection. Tennessee is a whole lot different than Pennsylvania, so it could be sizably different. But if I was worried, I wouldn't be worried about the air conditioning. I think kids these days need to stink and have the windows down and let it blow in their eyes and their hair. My goodness.

I mean, I drove a car without air conditioning for a year and a half when Stacy and I first got married because it was a cash car. And I drove in the morning, and I drove in the afternoon. It was like, come on. So some of these things are about saving up money, suffering a little bit, and how big of a deal is it to suffer and have your kids have the summer air blow through the car? You know, I wouldn't fix the AC on that car. You sound like a boomer. I am on this issue.

Here's my point, because then I would say, I'm with Dave. I would spend the minimal to get the inspection and then sell it and then buy a $10,000 car. And then get a car with air conditioning, for God's sakes. Well, then, yes. But until then, you tell people not to see the inside of a restaurant. I know. Now, I'm the owner for telling them to let the wind blow through their kid's hair? Well, I mean.

Thank you, folks. The audience agrees with me. Listen, I don't have any hair, so it doesn't matter. So there you go. Mom always called our air conditioner on our old car when I was growing up a 240, two windows down, 40 miles an hour. That's what she called it. I get them a full cup of ice and roll the windows down. Just blow right over the car.

A couple of dinosaurs here giving out advice to non-dinosaurs. But, you know, honestly, you drive like no one else so that later you can drive like no one else. So, yeah, if you need to go without the AC for a little while to get your goals hit, fine. I've done that, too. Act like it's a convertible. The kids will never know. But it's not like this is somehow better. They don't build them like they used to.

Thank God they were a piece of crap. Thank God they're better now. But, yeah, check all that out. But do the minimal and get the inspection, the car run keep your family going get your car paid off then save up and buy up in car and save up and buy up in car and save up and buy up in car as you build wealth move into better and better cars never never again a car payment and never again a new car until you have at least a million dollar net worth there's some good rules for you guys okay and for you diana as well thank you for calling we appreciate you joining us

open phones at 888-825-5225 here's the numbers a new car loses according to kelly blue book and according to yahoo finance and about three other sources a new car loses 60% of its value in the first five years. So that means if you buy a $40,000 car, when you drive it off the lot and you hear that sound going over the curb, when you went into the street, that sound was $10,000. That's the first drop as soon as you get it as soon as it's titled to an individual and it touches the street it's going to drop 20 25 percent that day okay then from there you're going to lose the rest of that 60 so 40 000 that means you're going to lose 24 000 that means your 40 000 car in five years is going to be a $16,000 car.

Okay? And that's a new car. Now, if you lose $24,000 every five years, don't be scratching your head and wondering why you don't have wealth. It's because you're driving it down the sewer. Okay? You're causing this. And so you can afford to take that hit if you got a million dollars.

You can't afford to take that hit if you're broke. This is The Ramsey Show. This show is sponsored by BetterHelp. All right, so I was born and raised in Texas and I love the myth of the lone cowboy. You know, the guy who doesn't need anyone or anything. It's a fun story, and it's a lie. In our self-obsessed society, we're obsessed about our own diets, our own workout routines, our own jobs, our own social media feeds, everything. It's easy to forget that no one can do life alone.

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That's betterhelp, H-E-L-P dot com slash Ramsey Radio. Ken Coleman, Ramsey personality, is my co-host. Thomas is in Jacksonville, Florida. Hey, Thomas, how are you? Hey, Dave, how are you? Better than I deserve. What's up? So I've been following you for quite a while, and me and my wife have been treating debt like it's cancer. We've been living kind of frugally, and I'm left with about 15 to 20 credit cards that are completely paid off, and we can't decide what to do with them because our credit score is so good we can't decide whether we want to close them or just hold on to them okay i'm confused i thought you said you were following us and that you said you hated debt is

that the same guy and i yes sir okay so you hate debt, why do you need a credit score? And that's where I'm at, but this is where the contention comes from. I don't think my wife's quite where I'm at as far as I used to love my credit score. So she doesn't hate debt. She wants more debt. It kind of feels like that, yes, sir. Okay. Well, that's a different issue.

Sometimes it feels that way, yes, sir. I mean, if you want debt that you do need a credit score if you want to go into that credit score is a good thing yes sir but it's an it's the antithesis of building wealth because your most powerful wealth building tool is your income and when you give all your income to other people because you stay in debt all the time then you're going to be broke your whole life and build other people tall buildings, not your own. Yes, sir. So our goal here is to get you out of debt so that you can become wealthy. And the only way a credit score is built, it's 100% based on how you interface with debt.

And it's for the purpose of getting in debt. And the way you get a good score is get in debt so that later you can get into more debt so that you run your score up so you can get into more debt so that you run your score up so you can get into more debt. And that's the essence of the FICO score. It's that we worship at the altar of the great FICO. We bring him offerings of interest and say, oh, great FICO, thank you for being my provider and letting me buy crap I can't afford with money I don't have to impress people I don't

really like. And that's the whole purpose of FICO if you want like a generational curse almost yeah if you it is it's exactly what it is and it's designed to prosper the bank it's not designed to prosper you but people you know people get caught up in this false measure of success it's not a real measure of success. So that's what you guys have to decide at your house. And then once you decide that, it's an easy fix. You just close the accounts and chop up the stupid cards, have a plastic surgery. Now, do you recommend keeping any credit cards?

I don't have any. I haven't had any. My credit score is indeterminable, known as zero. Wow. Just like the interest I pay, zero. It's almost hard to imagine because I've spent the past 10 years building my credit, you know, focusing on, you know, I've always been financially credit. I know.

Once you belong to the FICO cult, it's hard to get out because they brainwash you. You know, because you, you know, what you have to actually do is intellectually decide, is this a measure of success? And my contention is it is not a measure of success, that net worth and income are measures of financial success, not a score that says I've borrowed money a lot. Right. And made them successful.

I told my wife today, I said, I'll be a millionaire by the time I'm 35. No, you won't. By the time I retire, I'll have a million dollars. No, you won't. You're not going to. Not unless you fix this problem. Oh, I'm going to cut those credit cards up today. Okay.

And call those companies. And close the accounts. And close the accounts. All right. Well, and you better be on board with your spouse in doing this. I'm not trying to cause a divorce here, okay? I mean, the two of you need to sit down and talk about where you want to be. But if that's how you're going to live, you are going to be a millionaire.

Because that's the secret. I mean, it's not a secret it's that you keep your money and invest it instead of giving it to ford motor company and master card and amazon freaking prime and everybody else is profiting off your butt all you do is work for other people and give your money to them all your life. And that is the essence of debt. And so when you quit doing that, it's magical how much money you have. It reminds me of one of my favorite lines from a movie, Forrest Whitaker's The Actor. It's called The Great Debater.

It's about a truce. It's a true story. And at some point in the movie, his son, who's all into debate, he's a great student, but he's spending all of his time in debate club and he's letting his studies start to slip and his dad's getting on him. And he runs out with an attitude and his father follows him out on the porch and Forrest Whitaker says, son, do what you have to do. Then you get to do what you want to do. And that's the essence of the matrix that everybody's in because the credit cards say, do what you want to do. And that's the essence of the matrix that everybody's in because the credit cards say do what you want to do.

But wealthy people, they've already figured it out, and they go, I'm going to do what I have to do so that later I can do what I want to do. And this applies to money. And so if I have to wait to save up to buy something, if I have to wait to do the vacation I want to, if I have to wait to pay off my debt, my student loan. You know, the idea here is that there is a difference.

There's two very clear paths. One is the path to average. And the other is the path to excellence. And really wealthy people, it's a much smaller path. And they figure that self-delayed. They can delay gratification. They can figure out discipline because they got their eye on the prize they're thinking 30 years from now that's what they're

thinking and you got to pull yourself out of the matrix 30 years to live my life well it's not gonna be 30 years duper i mean it's gonna be 30 months for you to be debt free and start to have an emergency fund and start to get control it doesn't take that long um but yeah after 30 years you're gonna be really wealthy yeah you have to have that long view you know if you live like no one else later you'll get to live like no one else zig ziglar and the great motivators used to say if you want the things that other people don't have you have to do the things that other people won't do yes and so decide you know decide what what does it look like what does your life look like to be different than average because average is broke with a car payment and a student loan that's

been around so long you think it's a pet averages credit cards are necessary. I'm going to get rich on airline miles. The dumbest butt statement I've ever heard in my life. I'm going to, I'm going to make my money on discover points. Let's do the calculation on that one. Okay. Shall we? You run a hundred thousand dollars on your discover card. They give you 1% back. That's a thousand dollars in what school of thought does turning a hundred thousand dollars into $1,000 cause you to be wealthy? What logic is in, I mean, how much drugs did your parents have to do for you to believe that turning $100,000 into $1,000 is a path to wealth? I mean, the 70s were good to your folks, I'm just saying.

Oh, my God. Wow. wealth i mean the 70s were good to your folks i'm just saying oh my god wow i mean that's about as dumb as a rock right there but people they look at me straight in the face with this sincere thing that this is a methodology for building wealth i'm gonna take a hundred grand turned into one grand and that's wealthy huh that's just dumber than it's hard it's hard to get my head around so but this is these are the mythology that that average normal people believe and don't for god's sakes don't challenge their little myth because they get all pissed off if you challenge their falsehood that they're living right square in the middle of and believing yeah they get all they get all tiktok on you then man and just turn you into a meme i'm just saying i know a guy that happened oh man it it really is

funny though the cultural like you've got to have the credit score you heard it right out of his mouth by the way there's nothing wrong with him he's literally repeating what nine out of ten people repeat which is i gotta have the credit score to actually be a functioning human being so what do we got just under 400 million million people in America roughly now, right? I think that's right. There's 26 million millionaires. 26 million millionaires out of 400. So what is that?

That's, uh, well, just, uh, what is it? 5%? A little over 5? Right around 5%. So that means that if you are doing the things that we're talking about, you're in the top 5% of people in America. And then there's the rest of you. That's right.

That are just going to keep doing the stupid butt stuff over and over and over again until somebody yells at you enough that you'll get your attention. It's like, oh, I have my plan. Well, good luck with that. Look at how it's working for you. A $1,200 car lease? Dumber than a rock. This is The Ramsey Show.

Ken Coleman, Ramsey personality, is my co-host. Perfect question of the day for you with your frustrated sports announcer voice. I solved this. I'm a little excited. Today's question comes from Nathan in Michigan. By the way, I should point out that Nathan is from the state that has the national championship undefeated

Michigan Wolverine football team. Just want to point that out. Just like you're trying to say go blue is what you're trying to do. I really am trying to get away with it. Alright, here's the question from Nathan. What is your opinion on the recent changes allowing college athletes to profit from their name, image, and likeness for sports fans? You know this as NIL for non-sports fans when you hear that. We'll explain that in a second.

Do you believe this is a positive development for college athletics, providing athletes with more opportunities, or do you have concerns about potential implications for the integrity of collegiate sports? Well, let me address that first. athletes and with more opportunities? Or do you have concerns about potential implications for the integrity of collegiate sports? Well, let me address that first. The irony is that NIL has actually probably brought more integrity to collegiate sports because now it's removed all of the edges and all the cheating that's involved with recruiting, which would have been always cash to families or cash to athletes. And since the adoption of NIL, where college athletes can

be paid for their name, image, and likeness. I mean, let me correct you. It wasn't adoption. It was court mandated. Yeah, but I'm just saying. Supreme Court said they had to. That's right. And so now that is the law of the land. So what that has done is really removed a lot of the cheating and the backroom deals where you saw boosters causing a lot of problems. On the other issue, what is my opinion of it? I'm not a fan of it. I certainly understood that there was a case to be made that colleges and their athletic departments were profiting mightily from these athletes. But what has happened is I think it's swung too far the other way. And that with the transfer rules has now made it free agency and so college sports mirrors professional sports and but in fact it's even crazier it's the wild wild west there are no

contracts an nba or an nfl free agent is under contract for x amount of time the team and the athlete and the agent all know that the contract is coming up in college sports now kids can just simply declare via the transfer portal my coach hurt my feelings right and then they leave so uh i think we're in the wild wild west of the early days i think this will continue to morph uh but to answer the question i'm not a fan of nil i think it has uh it's just made the sport a little bit wackier and i think it's made prima donnas out of high school kids who by the way are showing up at signings for their college in lamborghinis university of alabama that happened this year kid showed up at his high school dave to declare he was going to alabama and he was driving a brand

new lamborghini so that can't be good there is something wrong with this picture ladies and gentlemen yeah i knew that would load you up yeah this is the equivalent of me putting a golf ball That can't be good. There is something wrong with this picture, ladies and gentlemen. I knew that would load you up. This is the equivalent of me putting a golf ball on a large brush tee so that you can hit it right down the middle, Dave. Thank you. What say you, sir? Well, I agree with you that the kids, they were due something,

but the court ruling completely took it out of the hands of the colleges to develop something because the court the colleges screwed up i mean if they had come forward if the ncaa had come forward and put together a plan where the kids could make some money and managed it and adopted that then it never would have gone to the supreme court but the supreme court just kicked the door completely open there's absolutely no rules like you said wild west it's um it's chaos and the problem is several fold then um we've got uh i don't mind keep some anybody profiting off of their their efforts okay regardless i think i'm that's called a meritocracy and i'm a big fan of meritocracies i believe if you work hard you should get something for that and if you have talent you should get something for that. And if you have talent, you should get something for that. I'm fine with all of that. The problem is with it

being completely out of control. Like I've had athletic departments call me and say, hey, would you come speak to the team? And I'm like, sure. What about? Well, we've got a quarterback that makes two million a year and the guy blocking for him makes nothing. How do we build teamwork in that? I'm like, i can't help you with that one yeah good luck that's like known as can't be done uh and so uh you know you need to restructure the whole thing uh but they don't have that option because the court took it away from them you can't structure it you'd have to you know you'd get sued again if you said okay we've got to put some of this money in a pool and the whole team benefit so we can build a team character.

And then you add to it the portal, which every time you piss somebody off, they just hit the road. And if you want to piss somebody off, piss off a highly aggressive 18-year-old who you are training to run over other people. And then piss them off. Yeah. And be surprised that they're pissed off. Because what you do all day long is teach them how to run over other people and then guess what as soon as you hurt their little feelings they're gone and so it's very difficult to build a a college team now

in this environment it's very difficult for uh because the kids there's this disparity of income and then the last problem is the same problem we've been facing when you and i've been working with the nfl and our team's been working with the nfl for years going to these rookie camps and we tell these young guys you know you just got a 10 million dollar signing bonus and i understand uh but you know 10 million is not enough to buy everyone in your in your you know in your entire family a two $2 million house. That's not $10 million. That's $100 million, and you did not get $100 million. Besides that, you're in the NFL, which stands for not for long.

3.2 years is the average career. 88% leave the league permanently physically disabled in some manner the divorce rate 10x the public okay this does not spell out well for wealth building okay it doesn't so let me tell you what happens to your 10 million it's gone in that situation that's what happens to it it's gone you don't have it and so but but you but you know you got bling and you got a lot of friends right now that aren't really friends and you're taking them to the Bahamas and go swimming. Well, good for you. That's dumber than crap.

And, you know, and so this is me talking to NFL people and guess what, guess how far popular that is. It's not popular. So, but it, you know, and now it's worse because now you're dealing with a 16 year old because the nils dropped down into high school now a hundred percent there are actually no limits now we're seeing it show up in high schools and we're going to see it in junior highs we're gonna see nine-year-olds ten-year-olds start to get payment to lead them through because we you know we we worship these sports figures and it's just guys guys, it's not good for the people.

You know, that kid that gets $10 million and doesn't manage it well, and it leads to horrible things in his life, it's not good for him. You know what it's done? It's really killed amateur athletics because the very word amateur is now completely defunct. It's not. I mean, once you collect a check for doing something, you are by default a professional. But it is pretty cool if you can show up for signing day in a Lamborghini. I don't judge the kid, but my goodness.

Hey, there's a defensive Alabama in here who said it was Ole Miss, not Alabama. Oh. I don't know if that's true. We've got it pulled up here. It was an Ole Miss player? All right. I have no problem being wrong because I was still using a great example. So I apologize to all you Roll Tide people.

You've got to be careful. You big blue people. We beat you in the Rose Bowl. There's that, yeah. Oh, it feels good to say. But anyway, the point is you've got an old Miss kid showing up. Oh, that's a Kiffin kid. Yeah.

Oh, that does make sense. Careful, Dave. That makes total sense now. Yeah. Okay. That was a little close to home. Lane Kiffin left the balls at. Careful, Dave. That makes total sense now. Yeah. Okay. That was a little close to home. Lane Kiffin left the balls at the altar, folks. And so Dave's not over that yet.

No, I'm definitely over it. Yeah, you got a good coach. But here's the deal. This has absolutely changed college athletics forever. And here's the other thing. You're going to see this begin to affect the non-revenue generating sports. If you like college. Here's the thing.

When I was dealing with college coaches um and we're sitting down talking to college football coaches and they say hey it's not unusual at all for some of the young men on my team for me to be the first male figure in their life to lead them well and to love them well yep and um regardless of race yeah and he goes it's not unusual at all uh for me to be that guy. And guess what? He's not anymore. He doesn't have that capability to love those kids well because they make more than he makes.

Yeah. And they will leave as soon as he challenges some of their mythology that they're living their life based on. Or their behaviors or whatever. It tries to make them sit on the bench. You don't have to sit on the bench. Here's one other unintended consequence. It's driving some of the great legendary leaders out of the game. The last two years, Entree Leadership Summit,

I think it's the best leadership event in the world. It's our signature event here at Ramsey Solutions, part of Entree Leadership. We've had on the stage arguably two of the top five coaches of all time in any sport, Nick Saban in football and Coach K just this last couple weeks, and both of them left, and they've told Dave and I, we were both around them. NIL was one of the reasons that drove them out of it. It's just changed the landscape.

The NIL and Porter together is just... Both of them, yeah. ...just real. So it's not good. It's not good for the kids. It's not good for the sports. That's the summation of it. And yet, I would never deny someone the right to earn money.

There's nothing wrong with that at all. So you've just got to figure out some way that it's done in a wise way that's a blessing to everybody involved. This is the Ramsey Show. We'll see you next time.