The Ramsey Show - App - We Bought a House… What Now? (Hour 1)

Episode Date: November 10, 2022

Dr. John Delony & George Kamel discuss: How much to spend on an engagement ring, What to do after buying your first house, Dealing with a pushy father-in-law. 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 and Storage Studio, it's the Ramsey Show, where America hangs out to have a conversation about your life, your work, your relationships, all of it. I'm John Deloney, joined here by George Campbell, also my good friend. And we're taking your calls on life and money and whatever's going on. But a bunch of cool folks showed up here in Nashville to hang out and watch it. They're all here to see you, John.

I'm going to agree to disagree with them. They're here to see you, man. They're disappointed Dave's not here. That's true. They're going, well. But also, they got the email you sent out and said, please come see me. I am desperate for validation. said, please come see me. I am desperate for validation. Please come see me.

888-825-5225. It's 888-825-5225. The call is free, and the advice is going to be worth about that much. Let's go to Brett in Milwaukee. What is up? Let's see here. There he is. Hey, what's up, Brett?

Howdy, fellas. How you doing? We're rocking on to the break of dawn my brother what's up Alright so I got a little bit of a life Financial and relationship question I'm currently in baby step 2 Halfway done I got $25,000 left in student loans

I'm also in a 5 year relationship She's waiting on me to Purchase a ring so my first question is How much did I spend on a ring I'm waiting on a five-year relationship. She's waiting on me to purchase a ring. So my first question is, how much should I spend on a ring? I'm waiting on you. Why five years, man? College. You wanted to graduate college before getting engaged?

Correct. You should have got through college faster. So are you done now? I am, yep. Graduated in December. So when are you done now? I am. Yep. Graduated in December. So are you going to get, when are you doing this thing? She's probably listening. So I'm going to keep that disclosed. Do it right now. I mean, I'm planning on it. Do it on air right now. She's not here, John. Okay. Oh boy.

Okay. So you're, you got 25,000 left. You're wanting to get an engagement ring. Correct. And what's your question? My question is, how much should I spend on an engagement ring? That's part of question one. Okay. What's the two-parter? The two-parter is I have a very unworthy car, and I went a little heavy on baby step one,

and I saved up $5, up in case it takes a dump. So you broke out there. Uh, how much do you have saved? 5,000. If you have a car that takes a dump, you've got bigger problems. You're talking about it just not working anymore. You're not riding a horse are you? Is it in the shop currently? What, what stage of life is it at? Um, well it's done in the shop in and What stage of life is it at? Well, it's done in the shop in and out, but I have it back now.

My transmission's a little sketchy. I can definitely tell it's going out, so I'd say maybe a year left on it. Okay. And so you're trying to figure out the timeline of when do I buy the engagement ring versus get a more reliable car while trying to pay off debt? Correct. What's your income? I make $67,000 a year. Okay. So how much extra is going towards your student loans right now each month?

I'm paying about 80% of my income, so about $3,300 a month towards loans. Wow. So you're living on nothing. Oh, yeah. Absolutely. Cool. Well, that makes this a lot sweeter. Are you doing side jobs right now on top of working full-time?

I'm trying to get into some woodworking stuff. Cool. Well, I think that could speed up the process to get this ring, and I don't think you need to get crazy with the ring. I think she's going to be happier about you popping the question than she is about a carrotat-bigger diamond. I mean, a whole carat would be impressive. I will say that, John. But you don't need to get anything wild.

Could you spend $1,200? Yeah, absolutely. Okay. What's she like? Is she going to be upset that there isn't a two-carat diamond involved? No, no, no. She's just going to be happy that you're committing to this relationship in a big way absolutely yeah i think you're overthinking it

man i think you go get a ring that you can afford and go get engaged man and if the cash goes the car goes kaput then we stop baby step two temporarily we're gonna save up real fast do some side jobs and get a reliable car that we can find on the lot can i on facebook brett i've been poking at you can i ask you a serious question yep um i'm just pulling together some some random uh data pieces here do you look into the future and like to plan for how the future is going to, going to, going to roll out? Yes. Uh, do you worry about how things are going to happen in the future? Yep. Okay. Um, you found somebody that you love and you've waited five years because you have a plan.

You're going to do it like this and you can do it like that. And now you're already worried about what's going to happen in the car to a car car in the future and that your car goes to the bathroom and you're still worried about what's going to happen, right? And so you've got, here's what I want you to do. I want you to not spend your life dress rehearsing tragedy. There's always going to be hard stuff coming up in front of us and we're going to plan the best we can. That's why we do the babysits.

That's why we get out of debt and have an emergency fund so that when life happens, we're ready for it. But if you walk through life with your hands up over your face like a boxer waiting to get hit, you miss all your life. And so you miss the joy, you miss the laughter, you miss the recklessness and the fun because we're waiting for the next shoe to drop at all times. And make no mistake the shoes

will drop that's why we set this plan up in the first place but i want to encourage you to open up your hands a little bit more and release some of this control you're trying to exert over things that are going to happen tomorrow in a year and five years from now ten years from now man follow the plan and love the people right in front of you. George, we do that a lot, man. Oh, yeah. And on top of that, John, the idea of weddings and engagement rings, it's gotten out of control. And I like the process of just going, hey.

A couple of dudes, we should talk about this. We can pay off our student loans. We can upgrade in car. And then later on, we can get a sweeter ring. Yeah. You can buy a new one. You know, that was always my plan i bought the ring i could afford back in the day and by afford i mean i put on a credit

card but i the one i had enough i had enough credit limit on the card uh that i could get and my plan was always to upgrade it at some point and we just celebrated our 20th anniversary my wife and i and she has no interest in an upgrade. She's like, no, this is the ring we got. 20 years in, you realize how insignificant that little piece of jewelry is to the overall arc of your relationship. Yeah. You can't measure a marriage by the size of the diamond on there, even if it's not a real diamond. There's a lot of options out there that are way more affordable. You can go on Etsy and find some beautiful engagement rings that are not going to be these high-end three-carat, you know, with the whole alphabet there listed for what color the diamond is.

I mean, it's just gotten crazy. Here's a spoiler alert. I forgot my wedding ring today, and I took a Sharpie and drew it on here. I thought you got that tattooed. No, actually I didn't. I drew it on there. Just like once a week, you just get a Sharpie out and redraw it. Not once a week. I just was on the way to work. I thought you got that tattooed. No, actually I didn't. I drew it on there. Just like once a week, you just get a Sharpie out and redraw it.

Not once a week. I just was on the way to work. I was hustling this morning. I had some early stuff this morning. At this point, just get it tattooed. I probably will. It's your next one. It's a henna.

It's a henna. That's right. Oh, that's good stuff. George, you've been married more recently than me. Was it a dramatic process? No. No, because it wasn't about the ring and the wedding. And we did get a free wedding because we're ballers and won a contest.

But that's just, you know, I can't give you advice on that. Yeah, you don't really get an opinion then because your wedding was free. That's true. But I do have a lot of opinions about how much you should spend on a wedding. And it should be as little as possible and more focused on premarital counseling than the wedding day. I like it. There you go. All right, this is The Ramsey Show, 888-825-5225.

Give us a shot. We'll be here when you get back. សូវាប់ពីបានប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្រាប់ពីប្� Call us toll free 888-825-5225 This is the Ramsey Show I'm John Deloney Joined by my best friend George Camel And we are taking your calls

On life, money, work Whatever's going on Let's go out to OKC Let's go to Oklahoma City and talk to Isaac. What's up, Isaac? How we doing? Hey, John. Hey, George. I'm doing good. How are you guys? Outstanding, brother. What's up? Okay, so I bought my first house. I moved from California to Oklahoma. I'm feeling like I bought a little more than I can chew, so I need some help on understanding that.

And then am I doing the right stuff with my finances, like budget and whatnot? More than you can chew, like too many rooms to vacuum, or more than you can chew, you bought way too much house? Finance-wise. Too expensive. Too much money. Okay. What's your take-home pay?

Monthly, it's about $2,186. I make about $40,000 a year. Okay, and what is this mortgage payment with the property, insurance, taxes, interest, all that? So it's $1,100. Oh, my God. Whoa! Yeah. Over 50% of your take-home pay is going so that you can live in this box.

Yeah. Ouch. How many bedrooms is it? Is it just you? No. So I'm married. I'm 25, married, and I got three boys. Okay.

Is your wife working outside the home, or is she home with the kids? We've literally been talking about just got off the phone with her. They're opening up a store here. So she's home right now, but we're thinking about her getting a part-time job or doing some DoorDash during the day. Yeah, I think that it's the only option right now if you want to stay in this house. How soon can you get your income up? What do you do for a living?

So I do insurance. So I do, like, account managing. Is it commission or salary? Salary based. But is there a commission on top of that? Very small yeah so if I do like personal insurance so if I sell a policy I get

10% of the 12% that the agency gets. Is this what you were put on earth to do? Or is this just a job you stumbled into when you had your first kid and then you've kind of been doing this? I've just been working. I started working at 15 at Raley's and then just kept going and work is work.

Do you have a degree? Just trying to, nothing, no college, high school diploma. Okay. Is this a 30-year mortgage? Yeah. Oh. Okay. So here's the deal.

You've heard both of me and George go, we've exhaled a few times with you. We're going to get all that out of our system and now it's going to be in solution mode. Are you ready for that? Okay. Let's do it. Okay. So you're all in? I'm all in. Okay. How much does this house cost by the way? 195.

Okay. How much does this house cost, by the way? $195. Okay. How much did you put down? About percentage-wise? Yeah. I think 3% to 5%. Okay. And how long ago did you buy it?

January. Okay. So it's been about eight months now. Oh, boy. I mean, are you guys able to breathe? Like, can you put food on the table? Well, we've been making it thus far. We've got a tight, pretty tight budget. Uh, I just calculated our last month budget and we were about a thousand dollars over. Um, what does rent cost in your area for you know i'm guessing you need at least a three bedroom yeah so it's about similar to the mortgage um so depending on where i mean i live in a decent neighborhood not you know the nicest parts

obviously um and so it's about the same. It's not much cheaper or more expensive. How old are these boys? Got a 7-year-old, a 2-year-old, and a 1-month-old. Okay. So even if... But if you sold this thing, you'd have still very little money. You don't have much equity in this thing at all.

No. I think there's like 10 grand equity or something like that. So it doesn't solve many problems to sell it and go rent somewhere for the same amount. No. So the only other option I'm seeing is we have to double your income like tomorrow. And that might mean a new career field, doing something different, sales, working for another agency that's commission-based,

and you go crush it. You kill it and drag it home so you can put food on the table and afford your mortgage. Okay. Or it may also mean, and this is going to be tough, I was hoping you were going to tell me

your boys were nine and seven and six so they could go to school and your wife gets a full time job but you've got 2 under 3 right you've got 2 and younger so you're going to be out another 600 bucks she's going to have to go get a job

regardless okay well let me George stop me if I get out of my head here so I'm trying to put myself in his situation and if I'm honest with you man man, I can hear it on you. Like you found yourself. Yeah, I'm stressed. Exactly.

I need you to let the shame part of this go. Okay? You were doing what you were told to do, which is to get in line for all these different products and things and just go figure it out and we'll just get a mortgage and we'll just get a house and let's leave California. All those things, you just did what you were told and here's where you find yourself, okay? You're not a crappy dad and you're not a screw up and you're not a loser. Is that cool? Hard to believe, but I'll go with it. I know. I can hear it on you, but if you continue

to drag that around with you, it will hold you back from getting a promotion. It's going to hold you back from going back to school. It's going to hold you back from all the stuff. And most importantly, it's going to hold you back from being connected with your wife. You're going to need her arm and arm on this one as you move forward. Is that cool? Yeah. Okay. So we're done with the head down. We're going to pick our head up and say, cool.

We found ourselves in a big, big hole and we're moving forward. And by the way, I'm going to teach these three boys what being a father and a husband actually moving forward. And by the way, I'm going to teach these three boys what being a father and a husband actually looks like. And they're going to get a ringside seat to ownership and responsibility and working your butt off

and achieving a goal. Is that fair? Yeah. Okay. So the two options you've got are to sell this thing and hopefully cross all of your fingers and toes that you get out bare even, right?

And then you go rent a house. And it's not going to change your financial position month to month, but it's going to get that rock necklace off your neck underwater, right? So that's number one. Or you decide we're going to buckle down and we're going to keep this house, and you're going to have to go make $25,000 more before the end of this month, whether that's your driving, you're getting up in the morning, you're mowing lawns on the weekends, whatever it looks like.

And it's going to rip your soul out because you're going to want to spend all the waking moments you have with those three little boys, and you're not going to be able to. But you're going to go get it done. So the math is $25,000 more. Hey, I just made that number up. I'm just telling you. You're going to have to double, go 50% up, double your income. You need a lot more money every month, and your wife's going to have to get a job too.

Do you guys have any debt? Okay. Other than the house? Just the house. Just the house. Do you have any money in savings? I got about $2,500, I think. Okay.

So kind of a starter emergency fund. I got about $2,500, I think. Okay. $2,500. Kind of a starter emergency fund. We're going to have to beef that up if we're going to continue to be homeowners because just one HVAC going out is going to tank you guys and cause you to go further into debt. George and Isaac, if I'm you, Isaac, I'm going to sell this house. Yeah. I'm going to sell the house.

I'm going to rent something. I might even get radical and get a two-bedroom apartment, and me and my wife are going to agree to lock arms in this for six to nine months. That means we're going to have evenings. One of us is going to take them to the park while the other one's working or whatever. We have to get them out of the house, obviously, or they're going to burn it to the ground. But we're going to go all in and get a huge emergency fund. We're going to get a nice down payment, and then we're going to be able to exhale.

And it's going to take about a year of just grinding it out, and then you're going to flip the script here, and you're going to be in a good position. One of the most beautiful parts about renting is that you are transferring risk back to the landlord. So if something goes wrong, it's not on you. And that's part of the stress you're feeling, is if one thing goes wrong in this plan, we're screwed.

So I want to help you guys out. I bought a home warranty and it sucked. Oh, dude, covers nothing. So, Isaac, I'm going to gift you Financial Peace University. I want you and your wife to watch every single one of those nine lessons in there. Along with that, I'm going to give you our premium version of our budgeting tool, EveryDollar. I want you and your wife to sit down together, write down your income, all of your expenses, map it out, see where we can shave so that we can get by for now as we increase income. So hang on

the line. Austin's going to pick up. We're going to gift you both of those things. Please use them. We're cheering for you, man. Call us back. We're going to help along the way. Hey, I'm going to throw this on too. I'm going to give you Ken Coleman's Paycheck to Purpose because you're going to get a new job. You're probably going to go to Coleman's Paycheck to Purpose because you're going to get a new job. You're probably going to go to community college or go to night school, and you're going to get a degree, and you're going to get a job. And I'm also going to send you my book, Own Your Past, Change Your Future. You're going to set this shame down, and you're going to get to making things happen. What aren't we sending him?

You. That's fair. You stay with me, George. I'll stay here, John, for safety. you're listening to the Ramsey show I'm George Camel Ramsey personality and host of the fine print and entree leadership podcast joined today by the host of the Dr. John Deloney Show. You guessed it. It's Dr. John Deloney himself. And your best friend. Yes, that too.

No. We're trying to convince America that John likes me, and so this is his attempt. No, I've been trying to- You invited me over your house already this hour. I've tried to be your best friend multiple times. Call me your best friend. Yeah. Fine.

You win, John. We're in? You win. Yep. We're best friends now. This is huge. It's that easy. You want to go do karate in the garage? No. Absolutely not. Oh, man. Then we're not best friends. That was a movie reference for those of you wondering. John doesn't actually do karate in his garage. I literally actually do karate in my garage. Doesn't shock me.

It's a whole other conversation. Well, this is about you, America, not about John and our friendship. So give us a call and make this stop. 888-825-5225. That's 888-825-5225. Mario, who's our new friend, he's in Houston. He's on the line. Welcome to the show, man. Hey, hi guys. I have a family crisis and kind of a financial crisis as a result. I just broke up with my fiance and she moved out. Sorry to hear that. I'm sorry, say again?

I'm so sorry to hear that. Yeah, man. Yeah, thank you. We just recently built a new house at $700,000 and it's got a $350,000 mortgage. No, no. And if we sell right now, it's at least a $50,000 loss based on all the realtors. My thought is if I buy her out her portion and take on the $350,000 mortgage between myself and my mom, I have $350,000 in cash. Do I pay down some of that mortgage with that? Do I even do this?

Do I even take this house so that we don't lose the $50,000? It feels like there's some sunk cost fallacy happening here. Dude, I would sell the house. Well, you're hanging on to this thing, but it's going to be a curse more than it's going to be a blessing. Mario, you're going to mess up your relationship with your mom with the money. Everything changes when you owe your parent money.

And you're going to have to figure out, you have to get with the attorneys and figure out what's the buyout fee and are we going to get this all signed off? Dude, I would take the hit and sell the house and don't buy a house with somebody you're not married to moving forward. Just because it's so complicated to unwind it all um is she uh is she is her is her name on the lease or i mean on the on the mortgage yes and on the title yes okay so you're

gonna have to refinance this thing anyways i don't know that the bank's gonna allow you to refinance on your own can you afford this yeah i think, I think it comes with $350,000. But what's your buyout going to be, $175,000? Her buyout would be about $125,000. How do you figure? Because that's how much she put in. Oh, okay. All right. And who's going to pay for the loss?

Yeah, that makes you fully responsible for the loss. I would be fully responsible, and I'm willing to do that because I don't want her to lose the money. She's got less money to begin with, and I don't want her to have to take it on. I'm willing to live in the house for a year or two and sell it. At that point, the price would hopefully not go down on the value of the home. It's a new build. It's a brand new house. It's just that, right. And the actual base value of the house from the same builder has gone up in price, but because there are no recent sales,

the realtors are telling me you're going to max out at 700,000 at best. And then, you know, when you do that, you're paying them 50,000 for the sale. So it's a $50,000 loss at least. And I could cover the mortgage if I, i needed to it'd be 50 of my pay as is hey let's mario mario mario yeah you're trying to make this work man you've had a lot of loss my guess is this breakup with the fiance has been sometime coming which means you've been living in chaos for a season is that fair a little bit yeah mean, the other issue is that if I move out now, I'm having to find an apartment and the apartment prices are fairly high as well. The cost of the apartment is going to be effectively the same. If maybe a little bit more, if I just was able to pay down

the mortgage itself, my mom is living with me anyway. So, and between us, we can cover at least a majority of the mortgage. And I'm not saying put everything in it just because I need to have some money saved, maybe a hundred thousand. So have a hundred thousand dollar mortgage as a result. So here's the thing. You've got a plan. You've got a plan. You're clearly a smart guy. You got a plan. Um, and so you're going to do what you're going you're gonna do i'm telling you if i was in your exact shoes i'm from houston if i had woke up in houston and yours i got engaged in houston so if me and the person who's my wife now if we'd broken up i would have sold the house and taken the hit and moved on with and moved into an apartment paid a lot of money and unshackled

myself from what was to begin playing for what will be. You are hoping, you are taking 50% of your take-home income, carrying your mom on a house note, on a prayer that the next two years, the economy pumps the house back up. I don't know if you've watched the news, but the next two years look like it's going to be a little bit of a rough ride. I would, I mean, George Hoppen, I would not be looking for the next 24 months for things to just go through the roof. Now, I'd be out to lunch on that, but I would take the hit and walk away. That's what I would do. Now, if you move to an apartment, mom would be with you, right? Yeah.

And so you'd be splitting that rent. I think you can find a place that's not 50% of your pay with mom to rent for a while until we figure out what's next. Because it sounds like you don't need a house this big anyways. I don't, but now we're going to a house, an apartment that's a third the size. Hey, brother, that's ego. Most of the situation is a mental thing, you know what I mean? I know, Mario, but it's going backwards that's ego man you're retooling

because you had plans in your life and those plans are different now and there's a move in mixed martial arts that we used to practice and that is sometimes you find yourself in a bad position up against the cage up against the ropes right and you literally

can't get out. You're stuck. And so we used to drill over and over how to ride the round out because there is no offense happening here. You're curled up in a ball. You've got somebody on top of you raining down punches. I've got to finagle and take this for this season until the bell rings. I can get up and reset. That's where you are. You broke up with your fiance. You bought a $700,000 house with a girlfriend. It's already going to cost you money to get out of it. It's going to cost you half your life to stay in it.

You just got to turtle up and say, okay, we're going to go to an apartment. We're going to retool. And then we're going to take the next 24 months and figure out what comes next. And it feels like a step back. It's not, man. This is you protecting yourself and protecting your mom and protecting your future and making wise decisions when things are crazy. Yeah. Have you talked to your mom about this?

Yeah. What does she think? Just curious. Well, she wants to be able to help me and she thinks she's better just to pay down the mortgage, keep this house. And so later I can always get a roommate or not a roommate, a student or somebody to come in from my work that could be helping pay down some of the mortgage. And we've had the problem is, you know, she's had money in the bank from a home sale that hasn't been earning squat. And so. Has she been saving for retirement?

Is she retired? Yeah, she's retired. Are you her retirement plan? Basically, yes. You are her retirement plan? Yes. Dude, don't sink what little cash she has left into this hole.

Don't do that, man. Yeah. Listen, I absolutely understand. Both George and I are... Well, we're not trying to minimize this at all. No, dude, this is hard. This is hard. I hear it on you.

It's hard, man. It's the reality of the situation. I'm trying to make... I want my ex-fiancee to not have to be screwed either. That's the thing. I got you. But hey, once the relationship is split, now this is a business transaction

because we made a business deal together. It felt like love at the time, but it was a business deal. And now that we're split, this is a business proposition. So it may be that she takes $25,000 of the $50,000 loss or whatever gets split out,

you take what you put in, she takes what she put in, all that, right? This was a decision you guys made together, which means all of the risk is on both of you. It's not just on you. So I don't want you to try to be a hero here and roll over and have it be a giant financial predicament. You're not being unkind by saying, hey, we're going to split the losses because that's what we're doing in this relationship. Or I'll take 60-40 or I broke up with you. You still love me. We're going to sell

this house, whatever we got to do. And it may be that you go back and talk to the builder who's got somebody else lined up and they're about to put a shovel in the ground without a real estate agent. And you go to the builder and say, hey, my life just blew up. Do you have somebody else in line that would be interested in this house? Because I don't want to lose $50,000. Maybe I can lose $25,000. Maybe I can lose $10,000. Maybe you can walk away that way.

But if I'm you, brother, I'm selling the house. Yeah, absolutely. Sorry, man. This is The Ramsey Show. We'll be right back. This is the Ramsey Show, 888-825-5225. Blinds.com's 100% satisfaction guarantee means even if you mismeasure or pick the wrong color, like George did with his jacket today, they'll remake your blinds for free. You get free samples, free shipping, and with the new promos they run every month,

you'll save even more. Use promo code RAMSY to get the best deal. Today's question comes from Alex in Chattanooga. My father-in-law wants to take the whole family, seven adults, four kids, to Scotland in 2024. His scheme is to pay for the air tickets with American Express credit card points. He has ordered cards for his three daughters and wants them to pay for everything in their life with them and pay him back on a weekly or monthly basis. Not sure of that detail yet.

He has already decided this, and the cards are in the mail. Apparently, he needs about one million points to get all the tickets for free. I know this is a horrific idea. I don't know how to tell him no on this. Can we just, before we get into this, it's kind of a great idea. I don't know how to tell him no on this. Before we get into this, it's kind of a great idea. Brilliant. I see this guy,

he was in an IHOP and he was like, wait a minute. And then he had a napkin and started doing the math. He was like, I could take my whole family. Oh, and he's a million points. Oh, and he's a million points. This is like when I was at Chuck E. Cheese and I was like, okay, I need 40,000 tickets

to get the boom box. And so I'd spend like 20 bucks, 30 bucks, and I'd end up with like 400 tickets. And they gave you like a little sticky hand and like a pack of gum. And so with $18,000, I could get that boom box up there with 40,000. Okay. So he's asking, I don't know how to tell him no. It's a father-in-law. It's a.

It's messy. It's a little bit of a different relationship. All right, so anytime somebody's asked me, George, how do I tell somebody no on this? We always practice.

Say, repeat after me. No, thank you. And then they'll look at me like I'm kind of an idiot and then they'll say, no, thank you. And I'll be like at me like I'm kind of an idiot, and then they'll say, no, thank you, and I'll be like, you did it. So here's what we have here. We have a father-in-law who loves his family,

and he wants to do a really cool thing. I would even go as far to read into this story as that there's something in their family lineage in Scotland. Maybe it's we're going to go back and see where great-great-great-great-grandparents lived or something. The whole idea here is pretty cool. And the father-in-law wants to honor everybody. We're going to do this. And father-in-law looks in the bank account and says, I can't pay for 11 people to go for a week to Scotland. Fair enough. Very few father-in-laws could do that. But he figured out a plan. It's just that the plan, as Alex writes, is a horrific idea, right? George, walk through. Why

is this a terrible idea? I've got my own opinion on it, but go ahead. Well, number one, he's apparently forcing his daughters to use credit cards to fund their life in order to get these points. And so I look at it logically. I look at the goal, right? The goal is Scotland 2024 for 11 people. And I go, okay, how much is that going to cost? So then I go, okay, we have two years to save up. Let's say it's $3,000 a person. Then I go, okay, daughter, number one, could you save up $3,000 in the next two years? What would that take to do that with cash? And I guarantee you it's a lot easier than the scheme of hoping you have enough points and by two years from now, let's hope American Express doesn't change their program

and what those points are actually valued at and what the blackout dates are and which airlines and places you can fly to. It's a nightmare. And worse built into this is, hey, honey, you owe me $49. Hey, honey, you owe me $706. And what happens when they can't pay

because they overspent to trying to help dad get as many points as possible? Or they have a $700 Costco bill, and they swipe it, and then all of a sudden the transmission falls out, and they got to fix that. And now dad's like, wait a minute, guys. I need my – But, John, there was 6% points if you shop online at this specific retailer. And so that's why I spent $1,000. Gotcha. In order to get the 6% instead of the 4%.

I needed 111 pairs of Banana Republic socks so that I could get the... This is the game we're playing. Now, the numbers here are outrageous. A million points of anything, regardless of what... We don't know what these points are worth. So great.

Let's look at Bitcoin. All right, here's my problem with it, okay? And you and I have talked about this just hanging out. Let's say this works perfectly. Let's say the family, they're all in. They come up with a foolproof system. We are going to, every week, we're going to write dad a check for the money that we spent. We're going to spend anyway.

We're going to spend this money anyway. We had to buy groceries anyway. We had to pay for rent anyway. We had to do all these things anyway. We just threw them on this American Express card. And then we wrote dad a check instead of writing it to our rent or to our light bill or whatever. Everything works out perfectly. And the family takes a 100% free trip to Scotland in 2024.

It all works. Here's what got me out of this system. Um, cause I'm somebody who used points and we paid it off every month. It never affected my family other than I was quote unquote winning. And it was a light bulb moment for me when I realized, Oh, this credit card company is not my friend. They're not just giving me free flights in hotels because they like me. And they're like, you've been so good to us, bro. We're going to be good to you. That's not how they work.

Then I realized that there's a single mom with three kids trying to figure out how she's going to put gas in the car because it's tripled in price. And she can't figure it out. She's got to swipe this card. And it's got a $500 limit. And she's having to balance that card with another one with a $250 limit. And she's paying for my flight. And I'm not going to be a part of a system that preys on people who can't make their payments or who found themselves suddenly a single mom like the last caller or who's living in a city and all of a sudden rent's tripled. I'm not going to go to Scotland for free on the backs of those men and women who are trying to scratch and claw their way through life.

I'm opting out of a corrupt system that preys on people who have less than or who are struggling. I'm not going to play. I couldn't enjoy a trip to Scotland that I got for free knowing that it was paid for by people who are struggling.

Or who don't have enough control in their life or who use shopping as some form of medication or some sort of anxiety relief from trauma, I'm not going to play that game. I'm opting out. I'd rather pay for my trip to Scotland. I'd rather tell my family, I want to do this cool thing,

like you mentioned earlier, in two years. Can we all save up? Can we all be a part of this? I'd rather that than this pretend thing like i'm taking this all for free y'all just do chores for me for the next two years baby yeah you do chores for me for the next two years and then we're all going for free i'm just not playing that game no so it's not so it's more of a it's a heart if you truly believe it's free then their

marketing is working very very well that's right or that they're friends with you that's amazing because what's going to take truthfully they're friends with you. That's amazing. Because what it's going to take, truthfully, they're going to have to spend hundreds of thousands of dollars on those cards over the next two years in order to get their million points. And even if you were going to do it anyway, don't play in a system that preys on other people.

Just don't, man. Not worth it. Yeah. So just save up. Give yourself some cash back. Here's the truth before we pass this on. Your father-in-law comes to you and says, hey, this is what we're doing.

This is how we're doing it. The conversation is probably, again, me and a friend of mine argue on this, but I think your wife is the one, or your husband, I don't know if Alex is a man or woman, but whoever is the direct child of this father-in-law sits down and says, hey, I don't play with credit cards. I don't participate

in this game. You let me know how much the tickets cost and I'll let you know if we can afford our family's ability to go. And we will put in the cash on this trip, but I don't participate in this. And it might be, are you, come on, it's all figured out. It's all cool. That's great, man. I just don't play in that game. And if your father-in-law doesn't respect your family's boundaries in that way, this trip to Scotland is going to be a pretty awful adventure.

So you've opted out. Thank goodness you avoided a pretty disastrous trip together, right? Yeah, I only see it one of two ways. Either father-in-law goes, hey, I want to gift this to you guys with no strings attached or, hey, I'd love to go on this trip. Let me know if you guys can make it and if we can afford it. There you go. But this weird in-between of

you got to play by my rules and sign up for this credit card and pay me back every month for everything you... That creates a very different dynamic in the relationship. Yeah. It just sounds like I've come up with a great idea. You just do chores for me for a long time. It reminds me of the call Dave took where a guy said,

hey, I want to buy a payphone for the house, and everyone puts quarters in it, and then I get all the money, and we get free phones. And Dave's like, don't you have to pay for the phone line? Like the air that the phone... And the guy was like, oh, I didn't think about think about that dang it i thought i scammed the system and oh boy good job yeah um speaking of scamming the system um that's the first hour of the books today ladies and gentlemen we did it that we did it um even though you got denim on denim here george and we're still going anyway going strong

hey we'll be back in the next hour uh join us, 888-825-5225. We'll be right back on The Ramsey Show. Hey, it's John Deloney, co-host of The Ramsey Show. Did you know over 18 million people listen to The Ramsey Show every week? A lot of those people listen on one of our 600-plus radio stations across the country. To find a station near you, go to ramseysolutions.com slash show. The Ramsey Show.